What is Market Research?
Market Research is any activity aimed at understanding the behaviour of consumers (whether they be industrial (companies) or end users (consumers) in a certain market. However commercial market research focuses on speed and answering specific management questions, rather than answering "interesting" or "theoretical" questions. (See below)
The term "market research" has in recent times come also to refer to the analaysis of stock markets, (where the "market" is company stock rather than consumers) however we use the term here in the context of the broader traditional meaning.
A "market" is influenced by a multitude of economic, social, psychological, cultural, legal and political factors. Any of these factors can influence the behaviour, (including purchase behaviour) of a set of defined consumers in a defined market. Market research can include broad analysis of a market as a whole such as feasibility research and estimation of market growth, or specific analysis products, product classes or target/sub groups within a market.
Market Research always involves some form of data collection - either Secondary Research (sometimes called desk, document or investigative research) or direct from the consumer - fieldwork.
It almost always includes the analysis of this raw data to help management see clearly the main factors and trends in a specific market, usually with a major focus on the client's own products, services, brands, or company, and often on their competitive positioning.
Unlike academic research, commercial market research attempts less to construct general theories but is highly focused on providing reliable and valid data on consumer behaviour in a specific product class or area within a specific target market, to answer urgent management questions. One key aspect of commercial market research is speed, while maintaining validity and reliability of results.
Market research typically extracts specific data on consumer preferences, perceptions, decision making, attitudes, usage, and any other areas for the purpose of marketing more effectively products, corporates and services.
A client usually approaches a market research agency with a set of Management Questions which they need answered to make better decisions. Together both the client and agency develops these into a set of broad Research Questions, designed to provide the data required. These research questions take into consideration target markets and the type of information required. A research plan is then developed by the agency including target markets, methodologies and techniques to be used, timings and costs. Once accepted the agency will then divide the translate the Research Questions into the actual questions that need to be asked in fieldwork (Investigative Questions) via intercepts, focus groups, secondary or "desk research", interviews, observation, or any number of a multitude of various research techniques.
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