What is the Market Research Process?
The market research process consists of five steps: formulation of the research question(s), designing a research methodology, data collection, analysis, and communication of the findings.
Formulating the research question(s)
Research questions are the key questions that need to be answered by market research. They follow from the specification of the management problem. For example, JPMorgan Chase is considering setting up a new online bank, the research questions it will want to answer include:
- What market share will the new bank get?
- How much of that market share will be cannibalized from JPMorgan Chase?
- What will be the average profitability of the customers attracted by the new bank?
Designing a research methodology
The market research methodology is the plan for answering the research question(s). It addresses the 6Ws:
- Who should be interviewed?
- What information should be obtained?
- When the data should be collected?
- Where should the data be collected?
- Why should the data be collected?
- What way should it be collected?
Although all these decisions are important, in practice the key decision relates to whether primary or secondary research is required. Primary research is research where an entirely new study is conducted (e.g., an online survey, or focus groups). Secondary research is where existing data is used (e.g., previously published studies, analyses of sales data).
Data collection involves collecting the data in accordance with the research methodology. For example, if the research methodology is to conduct an online survey, then the data collection is the process of conducting this survey.
The specific analyses that are conducted usually follow from the research questions. However, all studies will typically also include exploratory analyses, with the goal of extracting interesting results that were not hypothesized when the study was designed.
In the case of survey research, a core part of exploratory analysis involves the creation and inspection of large quantities of crosstabs, which are tables that [verb missing – ‘reflect’? ‘tabulate’? ‘set out’? ‘show’?] the relationship between each question in a survey and a set of key profiling questions (e.g., age, gender, main brand purchased).
Communication of the findings
The communication of findings is usually referred to as the reporting stage. It typically consists of one or more of:
- A set of crosstabs, usually delivered in Excel
- A report, usually provide in PowerPoint and often presented in person (these reports tend to contain a mix of charts, tables, and commentary)
- An online report (which allows the audience for the findings to interrogate the data themselves)
The 6Ws are from Marketing Research by Naresh K. Malhotra (multiple editions).