Primary market research, also known as field research, is market research that gathers new original data first-hand for a specific research purpose. Primary market research is often very expensive to undertake, but the marketer controls the research, hence the results will be relevant and useful.
Purpose of primary market research might include the following situations:
- Detailed up-to-date information about consumers in the firm’s target market.
- How employees feel about the work environment?
- Gather data and information from customers to identify their buying patterns.
- Anticipate changes in market trends.
- Finding out about the quantities that consumers might purchase.
- Establish the size of the potential market for a new product.
- Why consumers will or will not buy a particular product?
- Help the business in its pricing and promotional decisions for the new product.
- Will consumers buy the new product for its features or rather because of its image?
The process of carrying out primary market research involves designing a research plan, then collecting information using appropriate methods of primary market research, inputting the data into the spreadsheet, producing results and analyzing results.
Two types of primary market research
In general, there are two basic types of primary market research methods – Quantitative and Qualitative.
1. Quantitative Market Research. Information gathered using quantitative means are often open to evaluation using statistical analysis. Data collected following a structured and well-controlled scientific research design can yield numerical values that can be analyzed using statistics. Such analysis may prove very relevant and even results from a small number of collection points may be used in determining characteristics of a larger group.
2. Qualitative Market Research. Sometimes referred to as ‘touchy-feely’ research, it gathers information that requires researchers to interpret the information without the benefit of statistical support. If the researcher is well-trained in interpreting respondents’ comments, this form of research can offer very good information, but may not hold the same level of relevancy as quantitative research. A researcher may want to know more about how customers make purchase decisions. One way to do this is to sit and talk with customers using one-on-one interviews. It is time consuming and expensive undertaking and, consequently, only a very small portion of the total population generally participate in the research.
Common methods of primary market research
The data and information can be gathered from several popular sources of primary data:
1. Questionnaire / Survey
A survey or questionnaire is a document that contains a number of questions used to collect data and information for a specific purpose. With the aid of a questionnaire the researchers can capture answers from respondents which are input into the research instruments directly by the respondents themselves or the researcher.
Advantages of survey: Surveys can collect both qualitative and quantitative data using both closed-ended and open-ended questions. they cover a very wide geographical area with results easily collated, analyzed and presented visually.
Disadvantages of survey: The relatively high cost and the low response rate as a large number of people are not willing to take part in the survey due to various reasons. Sometimes the results cannot be relied upon as representing the views of the entire population.
Example of survey: Three questions were asked in a recent survey of foreign holidays shoppers:
- How many foreign holidays did you take last year? The question is designed to obtain quantitative data to be presented graphically and analyzed statistically.
- What do you look for in an ideal foreign holiday? This question is designed to find out the key qualitative features that would influence consumer’s choice.
- How much money are you willing to spend on foreign holidays? This question is designed to gather quantitative data as well.
Different types of surveys
There are several methods used to survey current and potential consumers. Main methods of distributing surveys are:
- Self-completed surveys. These surveys are completed by a sample of carefully selected people to gather views, identify crucial information that can solve the problem, discover any existing trends, collect suggestions for improvements, etc.
- Personal surveys. These interview-like surveys are conducted face-to-face as a follow up activity to address any questions that might arise from the self-completed questionnaire. Usually conducted on the street, in the supermarket, in the office or in interviewee’s own home.
- Telephone surveys. These surveys are conducted with the help of telecommunications technology allowing a large number of people in a wider geographical spread to be covered.
- Online surveys. These electronic surveys are getting increasingly popular over the years thanks to computer software making them convenient to collate research data, thereby saving a lot of time and resources. Companies are either using their own websites to carry out non-paper surveys, or rely on third party providers of online survey tools such as Survey Monkey, Zoomerang.com or Google Forms.
- Postal surveys. These surveys are sent by mail to home or office address of the respondents for them to complete and send back as free postage is included. Often ignored, thrown away or treated as junk mail need to offer prizes or gifts to create an incentive for people to return postal surveys to prevent low response rate. All in all, a good way to research a population spread over a wide geographical area.
2. Interview
Interviews are face-to-face discussions between an interviewer and an interviewee to investigate in details personal opinions, beliefs, attitudes, feelings or circumstances and opinions. Interviews can also be carried out in via telephone or online chat. The findings from all interviews are analyzed to identify both the common views and differences among respondents.
Advantages of interview: The interviewer can explain any questions that the interviewee does not understand. Cover more topics than may be possible, if a respondent was completing a survey. The researcher can dig deeper into a respondent’s comments by asking follow up questions to find out additional details that may not have been included in initial responses.
Disadvantage of interview: Interviews provide long answers which contain non-quantifiable information that tend to be difficult to analyze statistically. Also, interviews are very time consuming and may be biased which can have an impact on the way in which respondents answer. If the interview process allows the researcher to vary what questions are asked, as not all respondents are asked the same questions, then this type of research may lack controls needed to follow a scientific approach. Interviewing all respondents individually can be quite expensive and intimidating to some people who are introverts. In addition, it is difficult to say whether the interviewee is replying honestly.
Example of interview: A convenience store in the neighborhood is planning to conduct in-depth interviews with local residents to investigate their views about a new proposal – redecorating the interior of the store and change the range of products.
3. Observation / Tracking
This method is about watching secretly customers or employees in their natural setting as they perform daily activities. The behavior is then recorded by market researchers through surveillance filming, photographs or in-person checklists to analyze how people behave and respond in different situations. This allows the business to check the quality of service that front-line employees are providing to customers or record how consumers behave in the shop when they buy products in the store.
Advantages of observation: More accurate than surveys and interviews as people’s actual behaviors are recorded rather than what people say they would do – as in the case of interviews and surveys – that is not necessarily true. Also, helpful to follow customers when they shop in a retail store, make purchasing decisions or use the products at home.
Disadvantages of observation: Some customers consider tracking devices as intrusive into privacy and personal space, especially when not disclosed to customers. Also, more expensive for large samples than other methods because trained observers need to be hired to analyze customer behavior.
Example of observation: Used by large supermarkets or grocery stores to observe the behavior of customers in the store as they select their products from the many options available on the shelves. Many online shops are also tracking their customers’ visits.
4. Focus group
A focus group is a group of respondent, usually between 8 and 12 people, who are invited to participate in a guided discussion to give feedback about launching new products.
In this discussion group, participants are encouraged to actively interact with each other sharing their attitude and responses towards topics such as new good and services, brand names, advertisements, new styles of packaging, etc. They are stimulated by the moderator to respond by the comments and the support of others in the group. The discussions are often filmed and recorded for future market research department as a source of data.
This information is more accurate and realistic than the responses to individual interviews or questionnaires where respondents have no discussion opportunity, and can have a big impact on the business’s decisions regarding the Marketing Mix
Advantages of focus group: Much greater depth of qualitative information can be collected from respondents than what can be obtained through individual interviews. Insightful information from customers can help with devising and refining better marketing strategies.
Disadvantages of focus group: Time-consuming and very expensive to arrange and conduct especially when participants need to be paid. No numerical data collected making statistical analysis impossible. A solution to this is an online focus group through video conferencing where respondents are not physically present in the room. Also, usually only extroverts tend to participate and there tend to be pressure for group members to conform to the majority view rather than to express own opinions.
Example of focus group: A manufacturer of consumer products is launching new hair shampoo for women and wants to find out from typical consumers what they think about that product and its marketing such as the color, smell, brand name and packaging of a new shampoo. The results might then be used to change one or more of these features to improve its successful entry into the market.
5. Consumer panel
A consumer panel is a variation of a focus group where a small group consumers from the business’s target market is used for carrying out regular market research instead of meeting only once to participate in a focus group. The researchers are continuously using the same group of consumers who are carefully selected from current and potential users of the product for providing ongoing input.
Advantages of consumer panel: The panel is comprised of people who have rather specialist knowledge about the product and market. It can be reconvened quickly for sharing new insights as the project develops to evaluate whether things change for better or for worse. By using the same group of participants, it saves the business from having to find new people.
Disadvantages of consumer panel: The continuous nature of the panel requires availability and commitment from that small group of consumers to provide ongoing feedback.
Example of consumer panel: Prior to launching a new car model, the car manufacturer often uses consumer panels formed by a group of both car specialists, industry experts and loyal customers who have been using the brand for a very long time.
6. Test marketing
A very limited quantity of the product is produced, promoted and sold in a carefully selected small geographical area of the market which should closely reflect consumer profiles of the whole market. Consumer reactions and sales figures will be recorded. Then, changes to the Marketing Mix will be made based on consumers’ feedback before launching the product full-scale to the main market.
Advantages of test marketing: The cost is limited only to selling smaller quantity of products in the test market. Identifying and solving any problems in the test market will increase the chances of a more successful product launch into the entire market. Risk of launching new products is reduced but not completely eliminated.
Disadvantages of test marketing: Takes longer to get the product into its main market, plus all the cost of producing test products with ongoing monitoring and analyzing results make test marketing much more expensive.
Example of test marketing: The national chain of supermarkets which owns shops in many regions of the country will choose to add a new product onto the shelves only in just one area. After the product turns out to be successful in the region selected, it will then be sold in other regions of the country as well.
7. Experimentation
Marketers often undertake experiments to gauge how the manipulation of one marketing variable will affect another. Simply, how one factor causes another situation, or whether there is a cause-and-effect relationship between two events.
Advantages of experimentation: Causal research has applications for many marketing decision areas including product testing, advertising design, setting price points or creating packaging.
Disadvantages of experimentation: Performing highly controlled experiments can be costly. Some researchers have found the use of computer simulations can work nearly as well as experiments and may be less expensive, though the number of applications of simulation for marketing decisions is still fairly limited.
Example of experimentation: A market researcher for a retail chain may want to study what the effect on sales would be if a point-of-purchase display is moved to different locations in a store.
8. Case Study
Marker researchers can prepare a case study to fully understand the outcomes of the new initiative and describe its impact on the firm.
Advantages of case study: Powerful means to portray changes or improvements to various stakeholders.
Disadvantages of case study: Usually quite time consuming to collect, organize and describe. Represents depth of information rather than breadth
Example of case study: To fully understand the client’s benefits of participation in a cost-saving program prepared by a consulting company which will conduct comprehensive examination through cross comparison of cases. The case study will fully depict client’s experience in the program input, process and results.
To summarize, in the real-life situations, it is very common for marketers to use a mix of both primary marker research methods and secondary market research methods. This is simply because neither of those methods is perfect and they tend to complement each other.
Different type of research will connect different data and information that the firm needs. Secondary market research is cheaper and quicker, but might be out of date and insufficient. While primary market research is expensive and may not be representative, yet it gathers purposeful insights to research the specific business problem.
