Effective Market Research and how it can be Conducted

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There are many academics that suggest the correct way to conduct market research (Lockett & Blackman, 2004; Beall, 2010), but in truth, there are a variety of different ways that are effective dependent on the situation. Kolb (2008) states the research process is comprised of four steps, which are; determining the research question, choosing the research approach, planning the research method and implementing the research. This highlights the importance that planning has in the market research process, as physically implementing the process comes after extensive planning and preparation.

This report will critically discuss the above four stages to conducting effective market research. An in-depth analysis of each stage will be conducted, to understand how each factor within the process affects the overall shape and effectiveness of market research.

Determining the Research Question

This is the first step to conducting effective market research and can often be rushed by many companies. As most organisations are eager to implement the process, they can be quick to decide on the research questions. However, it is imperative that the company or researcher decides on a clear research question, as the research question guides and centres the overall shape of the market research. Furthermore, it is absolutely crucial to the rest of the research process. Answering the wrong question can waste tremendous amounts of resources for a company, and make the market research completely ineffective (Springett & Campbell, 2006).

One of the main reasons for companies choosing the wrong research question is because they make false assumptions (Kolb, 2008). This means, to avoid false assumptions from being made, that a company will have to take the time to think critically about what the issue is, or what they are trying to understand through the implementation of market research. As previously stated, the research question should not be rushed, as it is a crucial step for implementing effective market research. This can be overcome by basing assumptions on previous research or experiences, which will guide the company to an educated and precise research question (Swartz, 2001). Some internal research data that a company could use are; sales receipts, complaint information, databases, orders or financial analysis. Furthermore, the research could show a variety of different problems, which could then be condensed into one research question to provide precise and effective market research (Martin, 2007).

Research Approach

Kolb (2008) states there are three different research approaches. These are; descriptive research, exploratory research and causal research. The approach that a researcher will take will be largely dependent on the research question, as they differ quite significantly.

Descriptive research is “concerned with the present and attempts to determine the status of the phenomenon under investigation” (Singh & Nath, 2010, p. 195). In essence, this will be used by a researcher or company when they want to discover specific details about something, such as consumer average spending. This is because it will analyse statistical data, and is most commonly in the form of surveys. A survey is most commonly used because it can obtain results of a large sample to draw conclusions that can be generalised amongst the population.

However, descriptive research is often expensive and time-consuming. This is because of the large amount of data that needs to be collected and analysed (Kolb, 2008). Furthermore, the type of research that surveys provide is often limited, as it only measures a small percentage of the population. It can also be an inconvenient approach to research, which makes it difficult to conduct research effectively. Consumers value their time, and generally do not want to spend it filling out surveys. However, online channels are minimising the inconvenience of surveys, and making a descriptive approach, once again, an effective method of conducting market research (Kolb, 2008).

Exploratory research is “about putting one’s self deliberately in a place – again and again – where discovery is possible and broad, usually (but not always) non-specialized interests can be pursued” (Stebbins, 2001, p. vi). This type of research could be used to measure consumer attitudes, opinions or beliefs towards a brand. These studies vary in size, but will usually be smaller than descriptive research. To conduct exploratory market research effectively, the researcher must explore deep into consumer’s emotions and attitudes, which would be hard to do with a large sample. The focus is more on choosing the right participant, and not trying to conduct the research on a large amount of people. Furthermore, it usually comes at a lower cost to a business, and doesn’t take quite as much time. However, it still suffers with inconvenience, as it can be hard to find participants to conduct the research with (Stuart, et al., 2002).

Causal research is a research approach that focuses on investigating into cause-and-effect relationships. That is to say, it will measure one variable with another and how these variables interact with each other (Brains, et al., 2011). Furthermore, it can be used to give insight into strategic change that a company may wish to pursue. This is because it can investigate whether the change will be beneficial or not for a company. However, it can still be used to research the effectiveness of change after it has happened. Causal research is often used as a preliminary approach, with the results being made more conclusive with the use of descriptive or exploratory research (Brains, et al., 2011).

It is imperative that a researcher or company knows what research approach it wants to take. As stated, it is largely dependent on the research question. However, if a company takes the wrong approach to answer the research question than they will not conduct effective market research, as they would be using the wrong tools and values to gather the data. Kolb (2008) compares choosing a research approachto a car mechanic, if a mechanic was fixing a car, he would choose a wrench, not a spatula. Furthermore, similarly to how the research question shapes the research approach, the approach will also have a significant impact on the research method. This highlights the important of each stage, and why planning and preparation is crucial to successful market research.

Research Method

There are two methods to market research; quantitative and qualitative. These methods differ greatly; quantitative research is an “approach for testing objective theories by examining the relationship among variables…which can be measured…so that numbered data can be analysed” (Creswell, 2014, p. 4) and qualitative approach will “allow a researcher to examine people’s experiences in detail, by using a specific set of research methods such as in-depth interviews or focus groups…” (Hennik, et al., 2011, pp. 8-9). More recently, especially in larger studies, these methods have been combined to form a mixed-method approach. This is a method which “combines elements of qualitative and quantitative research approaches for the purpose of breadth and depth of understanding and corroboration” (Johnson, et al., 2007, p. 123). What method a researcher or company will take is largely dependent on the situation. If a company wishes to understand consumer perceptions then they may prefer a qualitative study (Brunso, et al., 2002; Knox, 2000), whereas measuring consumer average spend would primarily be quantitative in nature (Muijs, 2010). Which method a researcher will conduct must be decided, as it will influence the approach and philosophy the research will inherit. Furthermore, it will also be a determining factor on the form of market research, such as via questionnaires, focus groups or interviews (Muijs, 2010).

Qualitative research will primarily take on an interpretivist philosophy, and an inductive approach. An interpretivist philosophy gives importance to human belief, and focuses on evaluating a small sample in detail to understand the views of many (Easterby-Smith, et al., 2002). Furthermore, an inductive approach “begins with the collection of data, rather than with a theory, and uses data to identify regularities or themes, or to suggest theories…” (Hayes, 2000, p. 789).

On the other hand, quantitative research will generally take on a positivist philosophy, and will also usually take on an inductive approach. A positivist philosophy is quite different to interpretivist, because it focuses on the collection of large amounts of data and quantifying the data with thorough statistical analysis (Lee, 1991). Using the examples above, if a company wanted to conduct effective market research to analyse consumer average spend, than they would conduct quantitative research with a positivist and inductive approach. This is because the researcher will collect a large sample of data to statistically analyse the average spend of a company’s consumers. Doing interviews would be small-scale and ineffective as it wouldn’t represent a large enough sample.

As previously mentioned, the research method will be a determining factor for what tool to use to conduct the research. Quantitative research will usually take the form of a questionnaire, which is a “survey instrument used to collect data from individuals about themselves, or a service or product…each respondent is exposed to the same questions…to ensure the differences can be interpreted as reflecting differences” (Siniscalco & Auriat, 2005, p. 3). On the other hand, qualitative research is usually in the form of focus groups or interviews, which are “a form of group interview that capitalises on communication between research participants in order to generate data” (Kitzinger, 1995, p. 299). This shows the disparity that exists between the different methods, and why a researcher must be clear on what their research method. Trying to obtain data using the wrong research method will yield negative results and will more than likely cause the market research to underperform.

Implementation and Findings

After the planning and preparation has been conducted, the market research, such as questionnaires or focus groups, can be implemented and analysed. Physically conducting research is perhaps the most complex stage of the market research process, but is made significantly easier through rigid planning and preparation (Craig & Douglas, 2005). Furthermore, this stage may consist of going out into the field to collect results, or simply waiting for participants to fill out a survey. It can be both the longest, or shortest, stage of the marketing process, with it being made significantly more effective with proper planning.

All the data collected would be analysed by whatever means appropriate. If a survey was used then the most effective method would be through the use of statistical software. However, qualitative research, such as focus groups, will primarily be analysed by the researcher or company, which will allow them to interpret the data how they sit fit. This can raise issues of bias, which is the extent to which researchers or participants may seek to influence the process of data collection, analysis and findings (A Bryman, 2008). However, if the company wishes for the market research to be conducted effectively, then it will be sure of eliminating all possible threats of bias.

Furthermore, this would be the stage where secondary research could be used, as it would help supplement the primary market research. Secondary research is “the re-analysis of data for the purpose of answering the original research question with better statistical techniques, or answering new questions with old data” (Glass, 1976, p. 3). The use of secondary research is usually decided by the researcher, but generally helps fortify any of the findings from the primary research ensuring that the market research is more effective and thorough.

Conclusion

From the discussion of how to conduct effective market research, it becomes quickly apparent that the most vital stage to conducting market research is the planning and preparation stage. A company must clearly define what there aims and objectives are, as it will help shape and design the overall market research process. There are a plethora of alternative methods to conducting market research, but each different method has its merits. A survey will not explore in-depth attitudes of consumer behaviour, but it will gauge a good understanding of average spend.

Utilising the wrong tools, approaches or philosophies to answer the research question will end up with ineffective market research being conducted, with the company losing substantial amounts of resources. Furthermore, the planning and preparation stage is so important because it will make the physical conduction of the research much easier. If a company knows what they are trying to discover, in what method, and with what tools, than they will be able to conduct the most effective market research in the most efficient manner.

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