The words' primary' and 'secondary' in research data collection can be misleading since they may make us think that one is more important than another. In market research, primary and secondary simply indicate the data source. Primary market research is conducted for the first time, whereas secondary market research refers to collecting existing information. This explanation will explore different types of primary market research methods and its advantages and disadvantages. Finally, you will have a chance to learn when to use primary market research based on real-life examples of businesses using it. Don't wait and start reading!
Primary Market Research Definition
Primary market research in business is when a company gathers new information directly from customers or potential customers to better understand their needs and preferences. It's like asking people what they think about a product or service so the company can improve or create something people will want to buy.
Primary market research is the process of collecting original, first-hand data directly from consumers, competitors, or the market environment to gain insights into consumer behavior, preferences, and trends, which can be used to inform business decision-making and strategy development.
Imagine a world where every person's favorite ice cream flavor is unknown. An ice cream shop owner decides to find out what flavors people love the most. So, they set up a taste-testing event where people can try various flavors and provide feedback. After collecting the data, the owner discovers that people love a new, unexpected combination: avocado-lime ice cream. The owner introduces this new flavor to their menu, and it quickly becomes a bestseller, all thanks to primary market research.
Primary Market Research Methodology
Primary market research methodology involves different research approaches, contact methods, and research instruments.
Research approaches
Primary data research approaches can be grouped into three main categories: observation, surveys, and experiments.
Observational research
The first primary research approach is observational research.
The collection of observational data may not directly involve a subject. For example, data is collected based on people's past transactions online and viewing habits on streaming platforms.
The number of likes and views on a video can serve as primary research data for a Youtube content creator.
Observational data also exists in many forms, ranging from text and numbers to images and videos.
An online article, bank transactions, streaming videos, etc. — Anything recordable can become primary data.
Another feature of observational data collection is that it may happen without people doing anything specific (e.g., monitoring mobile app usage) or taking a particular action (e.g., clicking like on a social media post). In some cases, companies can do ethnographic research to gather customer data. Ethnographic research involves sending a trained observer to watch people interact in their natural environment. This is a nondirect way to collect information about customer behavior.1
Survey research
Survey research is another popular method for primary data collection. It is used when a company wants to collect information in explicit detail. For example, when creating a buyer persona, companies can send out a survey to gather information about customers' beliefs, attitudes, preferences, and buying behavior.
Survey research involves asking people questions about their beliefs, attitudes, preferences, and buying behavior.
Survey research gives marketers great flexibility in data collection. It can be done in any situation and does not require a lot of equipment. The survey can be conducted in person, by phone, or by email. The main drawback is that customers may not remember all details about their actions and thus give incomplete answers. In some cases, customers may lie to appear knowledgeable or completely ignore the interviewer's questions for fear of privacy invasion.
A good example of survey research is the customer feedback request you receive after purchasing a product from a company.
Experimental research
The final method of primary data collection is experimental research. This research approach is often used to observe a cause-and-effect relationship.
Experimental research involves dividing subjects into groups, giving them different treatments, and observing alternate results.
A fried chicken restaurant wants to add a new sauce to its menu. They try out different spices for a week and observe customers' reactions. The one with the most positive feedback is then adopted permanently.
Contact methods
As you can see, there are many different research approaches, each with its benefits and uses. But how do they work out in real life? How can marketers reach consumers to conduct market research? Here are the most common contact methods for primary data collection:
Interviews - This can be done in person, by mail, or by phone.
Focus group interview - Companies send a trained interviewer to talk to a group of people about their product or brand.
Online market research - Data collection via the Internet and online survey, experiments, or online focus groups. An online focus group is a small group of people who gather online to discuss the product or brand with a moderator.
Behavioral tracking - Companies use online data to tailor product offerings to specific customers.
Research instruments
There are two main types of research instruments: questionnaires and mechanical devices.
Questionnaires are very common and easily implementable. They can be sent out in person, by email, by phone, or online.
Mechanical devices are instruments that monitor customer behavior - for example, mobile GPS to track customer location or MRI for brain scanning.
Standard questionnaires include closed and open-ended questions. Closed-ended questions limit interviewees' answers to a few choices, whereas open-ended questions are more open and exploratory by nature.2
For example, when asking for customers' dinner preferences, a closed-ended question would provide several pre-selected choices, such as pasta, salad, or hamburger. In contrast, an open-ended one would use a blank for the customer to fill in their answer.
Primary Market Research Methods
Primary Market Research Examples
There are many types of primary research, but what they all have in common is that they are conducted first-hand by the business or a researcher.
Online survey for a software company
A software company is planning to launch a new project management tool and wants to understand the needs and preferences of potential users. They create an online survey consisting of multiple-choice and open-ended questions related to features, user experience, and pricing. By analyzing the responses, the company can tailor the tool's functionality and design to more effectively meet the target audience's needs.
Focus group for a food product
A food manufacturer is developing a new line of healthy snack bars and wants to gather consumer feedback on taste, packaging, and overall appeal. They organize a focus group consisting of individuals from their target demographic and provide them with samples of the snack bars. The participants discuss their opinions and preferences in detail, offering valuable insights for the manufacturer to refine the product before its official launch.
In-person interviews for a gym chain
A gym chain is looking to improve its customer satisfaction and retention rates. They decided to conduct in-person interviews with current and former members to gather detailed information on their experiences, likes, dislikes, and reasons for staying or leaving. The feedback obtained from these interviews helps the gym chain identify areas for improvement, such as customer service, class offerings, or facility cleanliness, ultimately enhancing the overall member experience.
Primary Market Research Advantages
Primary market research offers valuable insights into customer behavior and preferences, helping businesses tailor their products and services to meet the needs of their target audience better. However, it's essential to weigh the advantages and disadvantages of primary research to determine if it's the best approach for a specific project or business.
Customized data
Primary research provides specific information tailored to a company's unique needs and questions. For example, a restaurant chain conducting surveys to identify the most popular menu items among its customers can use the data to optimize its offerings.
Up-to-date information
Primary research ensures that the collected data is current and relevant. For example, a fashion retailer conducting interviews and focus groups to understand the latest trends can create collections that appeal to their target customers.
A better understanding of competitors
Primary research can provide insights into competitors' strategies and performance. For example, a company can conduct observational research to analyze competitors' in-store displays or attend trade shows to gather information on their upcoming product releases.
Convenience
Many primary research methods are pretty convenient. For example, online research and telephone or online surveys can be carried out from the office and do not require traveling. This means a large population size can be covered quickly and inexpensively.
Primary Market Research Disadvantages
The drawbacks of primary data collection include the following:
Time-consuming
Primary research can be time-intensive, as it involves planning, data collection, and analysis. For example, a company conducting in-depth interviews may spend several weeks or months recruiting participants, conducting interviews, and analyzing results. Secondary data, however, requires less planning as researchers draw conclusions from existing references.
Costly
Primary research can be expensive, particularly when hiring research professionals or using specialized tools. For example, a small business may struggle to afford a large-scale survey project that requires an external market research firm.
Potential biases
Primary research can be subject to biases from both the researcher and the participants. A number of factors can lead to this, including misinterpretation of results, analysis of data according to one's opinions, and inaccuracy. For example, a poorly designed questionnaire may unintentionally lead respondents to provide biased answers, skewing the research results.
Primary vs. Secondary Market Research
What is the difference between primary and secondary market research? Other than the fact that primary research is conducted for the first time and secondary market research involves analyzing data already collected by someone else for other purposes, primary and secondary market research have their own advantages and disadvantages. Let's take a look at some of them.
In Table 1, you will find the main contrasting points of these two research methods:
Table 1. Primary vs secondary market research |
|---|
| Primary market research | Secondary market research |
Definition | Collection of new data to meet marketing needs | Sourcing existing relevant data |
Data collection | By the company (or outsourced) | By someone else |
Research methods | Survey Observations Experiments | Looking into existing data |
Advantage | More accurate and specific to marketing needs | Time-saving and cheap |
Disadvantages | Costly and time-consuming | Outdated data and not specific |
As you can see, primary data collection is the collection of new data by the company to meet specific marketing needs. In contrast, secondary data collection involves the use of existing information. Companies use primary research to attain more accurate, up-to-date, and problem-focused data; however, this type of research can be very costly and time-consuming. To save money and effort, marketers tend to look into secondary data first and conduct primary research to fill the gaps.
Primary Market Research - Key takeaways
- Primary market research refers to collecting original, first-hand data directly from consumers, competitors, or the market environment to gain insights into consumer behavior, preferences, and trends.
- There are three main approaches in primary market research: observational, survey, experimental researches.
- The types of primary market research methods include questionnaires, focus groups, interviews, observation, and field research.
- The main advantages of primary market research are up-to-date information, customized data, and up-to-date information.
- The main disadvantages of primary market research are costs, time, potential risk of biased results.
References
- Ken Anderson, Harvard Business Review, Ethnographic Research: A Key to Strategy, 2009.
- Survey Monkey, Closed-ended vs open-ended questions, 2022.
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