Market Research: Relevant for Home Business?

Market research is the acquiring of information about customer’s preferences, status, economic standing, demographics, etc in a way that is systematic and organized to produce results for analysis and study. Market research is used to determine the width, berth and depth of a market. In other words, market research is finding out how many people might be interested in a product or service based on who they are, what they do and how they behave.

Estimated market needs, size and completion can all be determined from the statistical analysis of the important information gleaned from the market research. The analysis of the information provides a critical stepping stone for gaining a competitive advantage over the completion in a market. The insight gained from applying the statistical and analytical methods and techniques of applied social sciences, offer support for decisions that can create a competitive advantage. A competitive advantage is the golden grail of business, everyone wants one, but not everyone will do the work required to get one.

Businesses have realized the relevance of the demographic information provided by market research since the advent of wide spread communication. Sponsorship of early radio programs in the early 1920’s most likely lead to the formalized market research programs of today. However, the true history may stretch back to formation of communities at river crossings because of the habits observed of people tending to cross the river at a specific site.

Primary Research and secondary research make up the two major classes of market research conducted today. Primary Research is actually divided into two subdivisions which are qualitative and quantitative research. In the terms of market research, the quantitative approach is one where a researcher asks a limited population a specific narrow based question in hopes of being able to apply the compiled answers mathematically to the general population in an unbiased way. Qualitative research asks broader based questions of larger populations. The researcher receives narrative answers that are then interpreted for themes and patterns exclusive to the participants. These are simple explanations of the in-depth approaches, but carrying out such studies may be well beyond the means of the typical start-up home business.

The good news about primary research, for the typically fund limited home business, is that there already exist huge databases of documented primary research information. Governments, universities, large corporations, news communities and libraries are among the sources for primary research information databases. These institutions have the resources required to compile the data required for the primary research. With the advent of the internet it may be more realistic for a home business operator to collect virgin primary research data, but the task will still require a huge amount of time and effort that may be better used elsewhere.

Secondary research is carried out behind the scene. Using the data compiled from the primary research efforts, the researcher summarizes, shifts, sorts, collates and synthesizes the previously collected data. The term desk research is often applied to secondary research because the researcher seldom is in contact with the primary source. There are free sources and pay-for sources of statistical data available, many from the same sources that have the primary research information.

Home businesses can effectively accomplish secondary research by summarizing articles, white papers, databases, books and so forth. Information on the conditions that exist within a market, assuming the analysis shows there is one, can let the business know the supply and demand situation, expected pricing, the competition, etc. The business can also determine the trends of the market to see if the products or services are moving up or falling off. Market research is a valuable tool to have in the pocket of a home business.

Terry Houwerzyl [] is a top-notch business coach out of San Antonio, Texas, who’s committed to helping you seek, plan, and execute your entrepreneurial vision. He’s been all over the map both professionally and personally, from serving in the Air Force to building custom chopper motorcycles, to showing Old English sheepdogs to racing sailboats. For many years, he played the role of a high-tech wizard, raking in a six-figure income as a computer programmer for private industry. Terry recognized the awesome potential of the Internet from early on, and found a way to capitalize on it. Today it is his passion to teach others how to do the same. Terry staunchly believes that in order to obtain true freedom, financial and otherwise, you have to go into business for yourself-and Internet marketing is just the tip of that iceberg. Terry is in the process of building a team of like-minded entrepreneurs dedicated to self-mastery, self-discipline, and self-transformation. His wellspring of knowledge and experience will help you to obliterate the learning curve on your own quest toward ultimate job security-and the millionaire lifestyle to boot.

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Marketing Research Methods: The Basics You Have To Know About

Are you considering starting a business or improving the performance of the current one? Market research will help you find unsatisfied needs in the market, give information about your customers or find out what your customers thing about your business and many more. The process includes the creation of an exploratory research to get to know your target audience first, using secondary research or qualitative research, consultation with experts or observation, and then verify the results with a quantitative research. The final and most important step is to analyze and interpret data collected.

Market research is the process of collecting and analyzing information from target markets in order to solve a variety of marketing problems. Market research will allow increased sales on a current product or testing the feasibility of a new product in a potential market. Thus, a market research will be conducted to find different needs targeted consumers have, so that a product or service can be created or improved to satisfy consumers’ needs.

Exploratory research: Get to know your audience first!

Exploratory research has to be used first to understand the people who are to be interviewed and the market to be researched. The main research activities include secondary research, qualitative research, consulting with experts and observation.

Secondary research includes finding data compiled by other people. Sources could include issued reports by the government or specific market, industry and country reports found in newspapers, magazines, journals and on the Internet. Secondary research should be performed before primary, the collection of data on your own, or else data taken from a primary research might already exist, through secondary sources, and waste money.

Qualitative research collects data through the direct interaction of the researcher with the target audience, either through group discussions or in-depth interviews. It aims to establish customers’ attitudes, values and beliefs.

The use of Focus groups is the process of having people to discuss different subjects in groups, and thus allows the full interaction of the researcher with the targeted audience. It may provide rich insights into consumer motivations and behaviors because group members will probably ‘feed off’ ‘each other. Qualitative research will help you create questionnaires that include questions about what is important for the respondent and worded in the language he uses and understands. A possible flaw of the method is that interpretation of the results is highly subjective because it depends on the skills of the moderator. Focus groups can be found today over the internet in the form of chat rooms or forums but with the absence of Body language and the interaction between the group members.

On the other hand In-Depth interviews include interviewing consumers individually for one or 2 hours based on a specific topic. It can be used when the presence of others can inhibit honest answers and viewpoints. For example, participants might not be willing to share personal experience with people they do not know and thus lie.

In general, qualitative research is based on discussions and interviews with actual or potential buyers of a brand or service.

Consultation with experts includes interviewing people who may not be part of the target segment but can still provide important marketing-related insights. For example, may include experts in universities or financial institutions. They can be useful in predicting future trends and developments.

Observation is useful when the product field is unfamiliar. For instance, watching people buy wine or paint in DIY stores will allow you to see how consumers use a product, observe any difficulties consumers have and eliminate them. The most basic form of observation is Ethnography which involves the prolonged and detailed observation of consumers, how people interact around their own environment.

The objective of exploratory research is to get acquainted with the market and the customers and thus, being able to base the quantitative survey on informed assumptions rather than guesswork.

The main quantitative data-collection stage: Verify and search deeper!

Based on the results of the qualitative research, a questionnaire should be created to verify the data collected, until this stage, and to look deeper in the marketing problem. The next step is to collect data by interviewing targeted consumers, possibly, via face to face, telephone, mail or on the internet. Response rates, effectiveness and the cost of the interview will vary based on each method.

Face to face interviews have the highest response rates out of telephone and mail surveys, because of the personal element present. Also there is no lack of control as to who completes the survey, allowing you to target your audience. It is more flexible, probing is easier and the interviewer can ask for more clarification or be able to stimulate the interviewee to give a full answer. This could be achieved through the phone too but time pressure and the less personalized situation will limit its use. Also Visual aids are available, for example drawing a product concept. Possible drawbacks include high expenses or causing bias responses, because of the presence of the interviewer, leading in socially desirable answers and the misreporting of sensitive info. In other words, respondents might feel that the researcher is intruding their private life.

Telephone interviews will generally give higher response rates than mail but lower than face to face interviews. It will allow a degree of flexibility, based on the skills of the researcher and probing could be achieved but in a limited degree. The less personalized situation will limit the number of questions asked before the interviewee terminates or gives invalid answers to speed up the process. Also, Visual aid is not possible and it could create difficulties for the interviewee to describe his thoughts in many instances. That includes instances where the aim of the research is to generate new product concepts; in such cases it may be hard for consumers to describe their thoughts.

Mail surveys are the least expensive of the three. There is a high Potential for low response rates and unrepresentative sample. Mail questionnaires are structured in a way that allows no further probe and low control in who completes the questionnaire. Although Visual aids can be supplied and bias is low, it will be used on a widely dispersed population which in turn will not allow you to target a specific audience. Mail surveys will be used best for products that can be used by a diverse group of people in specific targeted geographic regions.

The internet as a survey tool is even cheaper than mail surveys but the use of open-ended questions is limited. Similar to mail survey overall but can be easier to implement at a global level. Researchers need to be careful not to spam respondents, even when they have a list, because of junk mail considerations by many email users. A key decision is whether to use the email or a website or a combination of the two for the distribution of questionnaires. Based on empirical research, emails generate a higher response rate than websites. Who receives the survey can be controlled via emails and the problem of the same person completing more than once the same survey is solved. Often web-based surveys are better displayed, more interactive and sometimes easier to fill in when in a browser than in an email letter. This can be solved by sending an email with the html format of the survey. Another form of internet survey is the creation of online panels. Groups of consumers are recruited to respond to surveys for a small financial incentive and it allows specific targeting of groups.

Data analysis and interpretation: The most crucial of all!

The final stage includes analyzing and interpreting data collected. This might be the most important part because you will have to identify what data are valid and what not and create an overall result from the research which can be pretty much difficult if a lot of data was collected. Cautionary concern need to be taken in the interpretation of means and percentages and sampling error must be taken in consideration, meaning that a sample may not represent the actual population.

Many people will choose to outsource the research to a professional agency, were they will conduct the whole process. This would cost more but it would, possibly, allow more accurate results than conducting the research on your own, without any prior research experience. Imagine researching a market on your own, because of inexperience, a mistake could occur either in data collection or in its interpretation and cause you to take the wrong business decision that could jeopardize your business. I am not suggesting that you should definitely hire an expert but I think that, if you are a beginner in this area, you should definitely get the advice of an expert along the whole process.

In Conclusion, a successful marketing research will initiate based on a specific marketing problem. The researcher’s purpose is to solve this problem by collecting data from the market that can possibly provide a solution. The correct process to follow is the creation of an exploratory research via secondary, qualitative research, consultation with experts or observation. Based on results from exploratory research, the researcher should create a survey to find more accurate data about the problem in dispute using one or more methods, like face to face, telephone, mail and on the internet interviews. The final step, which in my opinion is the most important one, is to analyze and interpret collected data without any bias on the researcher’s part. In general, the most important thing to consider is to be creative. You should thing your own ideas of how to collect data, possibly by searching conversations on Facebook or by observing people in your local supermarket. Creating a business involves trial and error, learning from your mistakes; w

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