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Businesses today need to build a deep understanding of their customers, competitors, and external environment. Doing so empowers organizations to uncover actionable insights that enable them to make critical decisions with a high degree of confidence. 

The best way for businesses to build this knowledge is to conduct market research. By using proven research techniques to learn about customers, firms can develop products and services that address their customer’s needs, set prices at an appropriate level, and uncover and capitalize on emerging opportunities and market trends. 

The practice of market research dates back over a hundred years, although the techniques have developed a lot since then. Traditionally, the market research process starts with exploratory, qualitative research that aims to unearth new ideas and concepts, and then progresses to more data-driven quantitative research that adds a layer of rigor and certainty. A wide variety of research methods are used throughout this process, ranging from focus groups to surveys. 

The traditional research method is extensively used across a huge variety of industries, and with good reason: no matter the sector, it’s crucial for organizations to understand their target customer better. But the traditional methods of market research aren’t without their challenges, and new techniques are emerging that enable firms to build a more concrete vision of the future.

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Market Research

Learn how you can start building a significant competitive advantage with market research. 

Primary Market Research vs. Secondary Market Research

Market research typically involves both primary and secondary research. Both play an important role, and researchers should include both methodologies in their research. But what’s the difference between the two methods?

Primary research gathers new insight directly from research participants, and generally features a blend of qualitative and quantitative techniques. Primary research enables researchers to generate insights with a very specific focus on the topic they’re researching. 

Secondary research is the evaluation of existing data and public records to build a more complete image. An example being of an organization’s customers, competitors, and market. Information may be drawn from a wide variety of sources. The best practice in secondary market research is to employ a sophisticated Marketing and Competitive Intelligence (M/CI) platform. This enables organizations to process and analyze secondary research in a systematic way that gleans decision-ready insights in less time.

Breaking Down the Traditional Approach to Primary Research

Traditional market research has many applications: from testing out new product ideas to determining the demographic makeup of your target market. Organizations rely on market research to guide decision making, resource allocation, and future strategies. 

The traditional process begins with an exploratory phase, where researchers conduct primary research with a small group of participants. At this stage, the research will loosely explore different concepts, and aims to uncover potential issues that are worth incorporating into a more rigorous research process. This exercise is very qualitative in nature, and tends to utilize research methods like focus groups and interviews.

Once specific themes and opportunities have been identified, market researchers typically proceed to a more comprehensive effort that employs quantitative techniques. This phase is typically conducted with a much larger group, to ensure statistical significance, and will make use of classic research techniques like surveys and interviews. 

By taking deliberate steps in how they design their quantitative research protocol, market researchers can conduct all kinds of statistical analyses, including techniques like conjoint analysis or TURF analysis. These methodologies produce data-driven results that yield valuable information on customers, competitors, and the wider market, enabling leaders to make decisions that better cater to the needs of their customers. 

Market research is clearly valuable to firms. In fact, attempting to sell products or services to customers without doing any market research is like flying blind; there’s little doubt that you’ll crash and burn. However, traditional market research techniques aren’t without their drawbacks. These include respondent bias, an overreliance on historical data to predict future trends, and the fact that it’s difficult to explore truly novel ideas using traditional frameworks. 

If researchers aren’t aware of the limitations of traditional market research techniques, it can be all too easy for them to draw erroneous conclusions, which can have a disastrous impact on strategic decision making. A better approach combines traditional research methods with innovative techniques like prediction market research.  

Towards the Future: Prediction Market Research

Prediction markets are a relatively new approach to market research that challenge participants to predict the behavior of others, bet virtual currency on the outcome, and defend their positions with qualitative rationale. This methodology serves to eliminate many of the issues that hinder traditional techniques.

As hinted by their name, prediction markets offer high levels of value in predicting future trends, and have been proven to be more accurate in forecasting long-term outcomes than traditional research tools. Generally, researchers first conduct traditional research to develop a list of hypotheses that can be thoroughly tested using prediction market research techniques.  

Prediction market research enables firms to better quantify what the future will look like, and serves to explore issues around trend adoption, sizing, and timing. Armed with these insights, organizations can proactively invest in the future and ensure they stay aligned with market conditions, rather than reactively chasing emerging trends. 

If you’re interested in learning more about prediction market research, check out HUUNU™ Futures. Our consultants will partner with your organization to deliver a comprehensive research program that delivers actionable intelligence. 

Incorporating Market Research into Decision Making

It’s clear that market research has a lot of utility for organizations: learning more about your ideal customer and the market will never cease to be valuable. To be successful and keep their finger on the pulse of the market, it’s important that organizations conduct market research on an ongoing basis. 

The optimal approach to market research combines a variety of tools, from primary research like interviews and surveys to more advanced tools like prediction markets. By undertaking comprehensive market research, paired with systematically sourced secondary research, organizations can better position themselves to make important strategic decisions with a high degree of confidence.

Our consultants are available to partner on your market research initiatives and offer the perfect blend of traditional methodologies and groundbreaking prediction market research using HUUNU Futures. To learn more, schedule a call with our team