One of the key traits you find in successful entrepreneurs of today is the acceptance of the marketplace being a constantly evolving and unpredictable world. The trends keep wavering and if you aim to keep your business afloat, it is imperative that you keep yourself updated of these changes, and when necessary, bring the required diversification to your firm. Companies use various methods for these researches, all with different agendas and outcomes. In this article, we are giving you a brief step by step overview of a standard market research process.
To simplify, we divide this process of market research into 6 steps:
- Identifying the problem
- Deciding on a budget
- Developing a research plan
- Collecting data
- Analyzing data
- Presenting results and taking action
Step 1 – Identifying the problem
The first step is to define the problem, or the reason for research. You might want to investigate a drop in the sales of a product, or figure out why the workforce morale is deteriorating. Likewise, there may not be a problem at all. The research could be used to analyse a new opportunity, or bringing a change to the previous working ways of the company. Is it profitable to manufacture a certain new product? What activity can be added to work hours to keep the employees happy? These objectives are often classified into 3 categories; Exploratory research, Descriptive Research, and Casual Research.
Step 2 – Deciding on a budget
A lot more than often, certain companies fail to take this point into consideration, or they do it quite late. Research projects are varying in nature, some may be extensive, some conclusive, some might be primary, or it could be secondary. All these factors affect the total cost of carrying out a research. Companies often make the mistake of finalizing the research plan first and then moving on to their budget concerns. The problem with this is that when you are required to alter a pre-designed research plan to fit into the given budget, the plan may lose its effectiveness to a certain degree, and it is also time consuming to go over the same step twice. However, if you construct your research plan according to the budget from the very beginning, you can spend time on carefully distributing your resources to gain the best insights.
Step 3 – Developing a research plan
The research plan is what you can refer to as a framework or a blueprint for the entire operation. It is important to always keep in mind that the purpose is to formulate a plan that will test the hypotheses of interest, and provide insights that can help in decision making. This involves planning the necessary procedures to obtain the information; categorizing what data is to be obtained by primary research, and what information is to be sought out with secondary research? The method of primary research (surveys, focus groups, CATI, CAPI, CLT, telephonic interviews, face-to-face interviews, etc.). Deciding between qualitative and quantitative research. Designing questionnaires. In simpler words, you create the base of the whole project in this step. This is the guide that takes you through the rest of the process.
Step 4 – Collecting data
After developing a plan, it’s time to conduct the research. This step comprises of field work and secondary research. A work force needs to be appointed for field operations and data collection. It is not necessary that every research would have a primary and secondary section. Projects that aim to gather information on customer satisfaction might not need secondary research. Likewise, a business startup aiming to understand current market trends and product preferences might get the information from secondary sources without having to conduct a field study themselves. Therefore, it is important that you acquire a good understanding of the first step before starting the research, so you can effectively allot resources, and craft correct and useful questionnaires, interview scripts, focus groups, etc. To minimize data collection errors, it is advised to follow proper selection, supervision, training, and evaluation of the work force.
Step 5 – Analyzing data
This involves the interpretations of results. Data analysis is a process of inspecting and modelling data to highlight useful information and support decision making. Databases and spreadsheets can be used to extract information that could help understanding customer patterns, behaviors and characteristics. Here are a few tips that can help with the data analysis process: always communicate the results, try to avoid bias when interpreting data, and you should keep in mind that just because results fail to confirm the original hypotheses, doesn’t mean the research results are useless.
Step 6 – Take action
This step comprises of the evaluation of options. Based on the reported findings, the company’s higher executives plan out the course of action for the future. This insightful data is used to help with decision making, course adjustment and execution. In a presentation, the final conclusions based on the insights from the collected data are projected, and recommendations about how to apply the research.
References: Source 1: Technical hints have been taken from BBC’s Guide https://www.bbc.co.uk/bitesize/guides/zpcvpbk/revision/1 . Source 2: Mr. Imran has also contributed in this guide, Imran is a market research specialist from Greenland Research, a market research company from Dubai.