Market research is the process of obtaining information about a consumer market and then successfully interpreting and analyzing it. The information gathered will concern a particular product or service offered for sale in a specific market. It provides a way to obtain data concerning past, present and all possible future needs and desires of customers concerning a product or service. The information gathered could pertain to a customer’s location, spending habits and more. It will also involve learning about the products as well as operation and success of all competitors.
Surveys
One of the most commonly used market research methods is surveys. They are provided to customers in many different ways. A survey could be on the table of a restaurant in the form of a feedback card. It could also be an online survey and more. To be effective, it will require a large sample and the resources to conduct a thorough survey. These are effective tools in many circumstances. You can also use it to measure something very specific.
Focus Groups
This involves getting a group of individuals who are potential customers into a room and asking them certain questions about a company’s products and services. There will be a monitor available who will be responsible for guiding the discussion. They will observe how the participants talk about the goods and services among themselves. A team of professional observers will study the responses of the group.
Interviews
Many consider interviews as being able to provide the results of a focus group using one participant at a time. The moderator in these situations will be the interviewer. There are many different interviewing formats that can be utilized. An interview can involve a conversation that flows freely and is guided toward the topic concerning a product or service. Others can be very structured seeking to obtain specific answers to specific topics. This is an effective market research method when trying to identify a customer’s motivations, perceptions and more.
Field Trials And Experiments
This involves market research using live scientific testing. It is a method for testing specific variables and hypotheses concerning a company’s products or services. It is possible for this type of testing to take place in a controlled environment or in a natural setting. Many companies have had success in conducting experiments on which two different images were placed on a website requesting the same thing and seeing which one gets the best responses. A company could have two or even three different packing styles for their products and measure which one provides the most sales and more.
Secondary Research
This involves trying to obtain as much existing research data as possible about customers in a market. There are many different types of free data available. It could involve looking at online journals, Twitter comments as well as the US Census data and more. Secondary research involves knowing how to apply this available data to current market research.
Logistic Regression And Linear Regression
When trying to predict the probability of outcomes for market research many companies consider linear regression vs logistic regression. Logic regression is a method utilized to try and predict the probability of some event occurring. It tries to answer the question of the likelihood of a customer using a coupon or regularly purchasing an item. Many experts believe the information it provides should only be used as a guideline and not as a direct reason to implement an action. This is because logic regression can only provide binary outcomes. A more exact measurement of probability is provided by linear regression. This involves research that focuses on understanding a customer’s motivations, attitudes, needs, and behavior as it relates to a product and service. Linear regression focuses on conditioned responses when certain values are presented to a specific target market.
Effective market research is an important part of a company being able to react to changes in their customer base. There are many reasons the needs and desires of customers are constantly evolving. Companies with new products and services need to identify their target market to be successful. Companies with established products and services must quickly detect and respond to their changing and expanding customer base. Market research is an effective tool designed to make all this happen.
