Market research

Market research

Overview
Market research is any organized effort to gather information about markets or customers. It is a very important component of business strategy. The term is commonly interchanged with marketing research
Marketing research
Marketing research is "the function that links the consumer, customer, and public to the marketer through information — information used to identify and define marketing opportunities and problems; generate, refine, and evaluate marketing actions; monitor marketing performance; and improve...

; however, expert practitioners may wish to draw a distinction, in that marketing research is concerned specifically about marketing processes, while market research is concerned specifically with markets.

Market research is a key factor to get advantage over competitors.
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Encyclopedia
Market research is any organized effort to gather information about markets or customers. It is a very important component of business strategy. The term is commonly interchanged with marketing research
Marketing research
Marketing research is "the function that links the consumer, customer, and public to the marketer through information — information used to identify and define marketing opportunities and problems; generate, refine, and evaluate marketing actions; monitor marketing performance; and improve...

; however, expert practitioners may wish to draw a distinction, in that marketing research is concerned specifically about marketing processes, while market research is concerned specifically with markets.

Market research is a key factor to get advantage over competitors. Market research provides important information to identify and analyze the market need, market size and competition.

Market research, as defined by the ICC/ESOMAR International Code on Market and Social Research, includes social and opinion research, [and] is the systematic gathering and interpretation of information about individuals or organizations using statistical and analytical methods and techniques of the applied social sciences to gain insight or support decision making.

History


Market research began to be conceptualized and put into formal practice during the 1920s, as an offshoot of the advertising boom of the Golden Age of radio
Old-time radio
Old-Time Radio and the Golden Age of Radio refer to a period of radio programming in the United States lasting from the proliferation of radio broadcasting in the early 1920s until television's replacement of radio as the primary home entertainment medium in the 1950s...

 in the United States
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...

. Advertisers began to realize the significance of demographics revealed by sponsorship of different radio programs.

Market research for business/planning


Market research is for discovering what people want, need, or believe. It can also involve discovering how they act. Once that research is completed, it can be used to determine how to market your product.

Questionnaires and focus group discussion surveys are some of the instruments for market research.

For starting up a business, there are some important things:
  • Market information

Through Market information
Marketing Information System
A marketing information system is a management information system designed to support marketing decision making.Jobber defines it as a "system in which marketing data is formally gathered, stored, analysed and distributed to managers in accordance with their informational needs on a regular...

 one can know the prices of the different commodities in the market, as well as the supply and demand situation. Information about the markets can be obtained from different sources, varieties and formats, as well as the sources and varieties that have to be obtained to make the business work.
  • Market segmentation

Market segmentation is the division of the market or population into subgroups with similar motivations. It is widely used for segmenting on geographic differences, personality differences, demographic differences, technographic differences, use of product differences, psychographic differences and gender differences. For B2B segmentation firmographics
Firmographics
Firmographics are the characteristics of an organization especially when used to segment markets in market research. What demographics are to people, firmographics are to organizations....

 is commonly used.
  • Market trends
    Market trends
    A market trend is a putative tendency of a financial market to move in a particular direction over time. These trends are classified as secular for long time frames, primary for medium time frames, and secondary for short time frames...


Market trends are the upward or downward movement of a market, during a period of time.
The market size is more difficult to estimate if one is starting with something completely new. In this case, you will have to derive the figures from the number of potential customers, or customer segments. [Ilar 1998]

Besides information about the target market, one also needs information about one's competitors, customers, products, etc. Lastly, you need to measure marketing effectiveness
Marketing effectiveness
Marketing effectiveness is the quality of how marketers go to market with the goal of optimizing their spending to achieve good results for both the short-term and long-term...

. A few techniques are:
  • Customer analysis
  • Choice modelling
    Choice Modelling
    Choice modelling attempts to model the decision process of an individual or segment in a particular context. Choice modelling may also be used to estimate non-market environmental benefits and costs....

  • Competitor analysis
    Competitor analysis
    Competitor analysis in marketing and strategic management is an assessment of the strengths and weaknesses of current and potential competitors. This analysis provides both an offensive and defensive strategic context to identify opportunities and threats...

  • Risk analysis
    Risk analysis (Business)
    Risk analysis is a technique to identify and assess factors that may jeopardize the success of a project or achieving a goal.This technique also helps to define preventive measures to reduce the probability of these factors from occurring and identify countermeasures to successfully deal with these...

  • Product research
  • Advertising the research
  • Marketing mix modeling

Top 9 of the market research sector 2009


From the Honomichl Top 50
Honomichl Top 50
The Honomichl Top 50 is an annual compilation of the top 50 revenue-generating marketing research firms operating in the United States. The Honomichl Top 50 is published by the American Marketing Association magazine, Marketing News...

: >
Rank Company Sales in 2009
(million USD)
Growth in %
1 Nielsen Company 9,056.0 2.6
2 Kantar Group
Kantar Group
Kantar, based in UK, was founded in 1993 as the Market Research, Insight and Consultancy Division of WPP plc, a London-based public company. It is a network of 13 specialist companies, with around 28,500 employees working in 100 countries across various research and consultancy disciplines...

 - TNS, Millward Brown, BMRB, IMRB International and Ziment Group
4,692.0 2.5
3 IMS Health Inc. 1,958.6 8.5
4 GfK AG 1,397.3 5.4
5 Ipsos
Ipsos
Ipsos S.A. is a global market research company headquartered in Paris, France. The Company was founded in 1975 and has been publicly traded on the Paris Stock Exchange since 1 July 1999...

1,077.0 6.5
6 Synovate
Synovate
Synovate was a market research firm owned by the Aegis Group. It was formed from the acquisition of a number of smaller market research firms. It has a number of different divisions, such as Synovate Healthcare, Synovate Customer Experience, Synovate Censydiam and Motoresearch. They claimed...

739.6 9.5
7 IRI
IRI
IRI may refer to:* International Reference Ionosphere a common scientific project of URSI and COSPAR* International Roughness Index, a dimensionless quantity used for measuring road roughness, proposed as a world standard by the World Bank...

665.0 6.6
8 Westat
Westat
Westat is an employee-owned corporation providing research services to agencies of the U.S. Government, as well as businesses, foundations, and state and local governments....

425.8 0.8
9 Arbitron
Arbitron
Arbitron is a consumer research company in the United States that collects listener data on radio audiences. It was founded as American Research Bureau by Jim Seiler in 1949 and became national by merging with L.A. based Coffin, Cooper and Clay in the early 1950s...

400.0 5.9

Global market research turnover in 2009

>
Rank Continent Sales in 2009
(million USD)
Share
1 Europe
Europe
Europe is, by convention, one of the world's seven continents. Comprising the westernmost peninsula of Eurasia, Europe is generally 'divided' from Asia to its east by the watershed divides of the Ural and Caucasus Mountains, the Ural River, the Caspian and Black Seas, and the waterways connecting...

13,299 46%
2 North America
North America
North America is a continent wholly within the Northern Hemisphere and almost wholly within the Western Hemisphere. It is also considered a northern subcontinent of the Americas...

9,188 32%
3 Asia Pacific 4,480 15%
4 Latin America
Latin America
Latin America is a region of the Americas where Romance languages  – particularly Spanish and Portuguese, and variably French – are primarily spoken. Latin America has an area of approximately 21,069,500 km² , almost 3.9% of the Earth's surface or 14.1% of its land surface area...

1,486 5%
5 Middle East & Africa 492 2%

See also

  • A/B testing
    A/B testing
    A/B testing, split testing or bucket testing is a method of marketing testing by which a baseline control sample is compared to a variety of single-variable test samples in order to improve response rates...

  • Advertisement tracking
    Ad Tracking
    Ad tracking, also known as post-testing or ad effectiveness tracking is in-market research that monitors a brand’s performance including brand and advertising awareness, product trial and usage, and attitudes about the brand versus their competition....

  • Advertising research
    Advertising research
    Advertising research is a specialized form of marketing research conducted to improve the efficiency of advertising. According to MarketConscious.com, “It may focus on a specific ad or campaign, or may be directed at a more general understanding of how advertising works or how consumers use the...

  • Copy testing
    Copy testing
    Copy testing is a specialized field of marketing research. It is the study of television commercials prior to airing them, and is defined as research to determine an ad’s effectiveness based on consumers’ responses to the ad. It covers all media including print, TV, radio, Internet etc...

  • Council of American Survey Research Organizations
    Council of American Survey Research Organizations
    The Council of American Survey Research Organizations 325+member companies and their 32,000 employees, all of whom are afforded membership benefits, represent nearly $8 billion in global annual revenue—about 85% of the U.S. research industry and 30% of the global research industry...

  • Experimental techniques
    Experimental techniques
    Experimental research designs are used for the controlled testing of causal processes.The general procedure is one or more independent variables are manipulated to determine their effect on a dependent variable...

  • Eye tracking
    Eye tracking
    Eye tracking is the process of measuring either the point of gaze or the motion of an eye relative to the head. An eye tracker is a device for measuring eye positions and eye movement. Eye trackers are used in research on the visual system, in psychology, in cognitive linguistics and in product...

  • Global marketing
    Global marketing
    The Oxford University Press defines global marketing as “marketing on a worldwide scale reconciling or taking commercial advantage of global operational differences, similarities and opportunities in order to meet global objectives.”...

  • Industry or market research
    Industry or market research
    Industry or market research is the acquisition of corporate intelligence on a broad range of issues including:* Macroenvironment**economy**government**law**technology**ecological* Market analysis and competitor analysis**market definition**market size...

  • Integrated marketing communications
    Integrated Marketing Communications
    Integrated Marketing Communications is defined as customer centric, data driven method of communicating with the customer. IMC is the coordination and integration of all marketing communication tools, avenues, functions and sources within a company into a seamless program that maximizes the impact...

  • Marketing effectiveness
    Marketing effectiveness
    Marketing effectiveness is the quality of how marketers go to market with the goal of optimizing their spending to achieve good results for both the short-term and long-term...

  • Return on marketing investment
    Return on marketing investment
    Return on marketing investment is the contribution attributable to marketing , divided by the marketing “invested” or risked. ROMI is a relatively new metric. It is not like the other “return-on-investment” metrics because marketing is not the same kind of investment...

  • List of marketing research firms
  • Market analysis
    Market analysis
    A market analysis studies the attractiveness and the dynamics of a special market within a special industry. It is part of the industry analysis and this in turn of the global environmental analysis. Through all these analyses the chances, strengths, weaknesses and risks of a company can be...

  • Marketing
    Marketing
    Marketing is the process used to determine what products or services may be of interest to customers, and the strategy to use in sales, communications and business development. It generates the strategy that underlies sales techniques, business communication, and business developments...

  • Market Intelligence
    Market Intelligence
    Marketing Intelligence is the information relevant to a company’s markets, gathered and analyzed specifically for the purpose of accurate and confident decision-making in determining market opportunity, market penetration strategy, and market development metrics. Marketing intelligence is...

  • Marketing Research Association
    Marketing Research Association
    Founded in 1957, the Marketing Research Association, Inc. is one of the largest trade associations of market research and polling professionals. MRA has more than 3,000 members worldwide, representing all segments of the research industry...

  • Marketing research mix
    Marketing research mix
    The term Marketing research mix was created in 2004 and published in 2007 . It was designed as a framework to assist researchers to design or evaluate marketing research studies. The name was deliberately chosen to be similar to the Marketing Mix - it also has four Ps...

  • Master of Marketing Research
    Master of Marketing Research
    Master of Marketing Research is a graduate degree program that may be from one to three years in length. About 75 percent of the fulltime programs can be studied in about one year while part-time Masters in Marketing are studied besides the job and usually need a minimum of two years to be...

  • Mystery shopping
    Mystery shopping
    Mystery shopping or a mystery consumer is a tool used externally by market research companies or watchdog organizations or internally by companies themselves to measure quality of service or compliance to regulation, or to gather specific information about products and services...

  • Neuromarketing
    Neuromarketing
    Neuromarketing is a new field of marketing that studies consumers' sensorimotor, cognitive, and affective response to marketing stimuli. Researchers use technologies such as functional magnetic resonance imaging to measure changes in activity in parts of the brain, electroencephalography and...

  • Observational techniques
    Observational techniques
    In marketing and the social sciences, observational research is a social research technique that involves the direct observation of phenomena in their natural setting...

  • Online research community
    Online research community
    An Online research community is a part of an emerging and developing area in market research making use of developments in Web 2.0 technologies and online communities...

  • Phronetic social science
    Phronetic social science
    Phronetic social science is an approach to the study of social – including political and economic – phenomena based on a contemporary interpretation of the Aristotelian concept phronesis, variously translated as practical judgment, common sense, or prudence. Phronesis is the intellectual virtue...

  • Propaganda
    Propaganda
    Propaganda is a form of communication that is aimed at influencing the attitude of a community toward some cause or position so as to benefit oneself or one's group....

  • Porter five forces analysis
  • Quantitative marketing research
    Quantitative marketing research
    Quantitative marketing research is the application of quantitative research techniques to the field of marketing. It has roots in both the positivist view of the world, and the modern marketing viewpoint that marketing is an interactive process in which both the buyer and seller reach a satisfying...

  • Qualitative marketing research
    Qualitative marketing research
    Qualitative marketing research is a set of research techniques, used in marketing and the social sciences, in which data is obtained from a relatively small group of respondents and not analyzed with inferential statistics...

  • Social research
    Social research
    Social research refers to research conducted by social scientists. Social research methods may be divided into two broad categories:* Quantitative designs approach social phenomena through quantifiable evidence, and often rely on statistical analysis of many cases to create valid and reliable...

  • Website correlation
    Website correlation
    Website correlation, or website matching, is a process used to identify websites that are similar or related. Websites are inherently easy to duplicate. This led to proliferation of identical websites or very similar websites for purposes ranging from translation to Internet marketing to...


Other reading


  • Bradley, Nigel Marketing Research. Tools and Techniques.Oxford University Press, Oxford, 2010
  • Marder, Eric The Laws of Choice—Predicting Customer Behavior (The Free Press division of Simon and Schuster, 1997. ISBN 0-684-83545-2
  • Young, Charles E, The Advertising Handbook, Ideas in Flight, Seattle, WA, April 2005. ISBN 0-9765574-0-1
  • Kotler, Philip and Armstrong, Gary Principles of Marketing Pearson, Prentice Hall, New Jersey, 2007 ISBN 978-0-13-239002-6, ISBN 0-13-239002-7


External links

  • Honomichl Top 50 - 2008. Marketingpower.com. Annual business report of the top 50 players in the U.S. marketing research industry. American Marketing Association
    American Marketing Association
    The American Marketing Association is a professional association for marketers. As of 2008 it had approximately 40,000 members. There are 76 professional chapters and 250 collegiate chapters across the United States....