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It’s crucial for leaders in any industry to always have their fingers on the pulse of their target market in order to best understand their customers, competitors, and general environment. One way to do that? Market research. 

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Market Research

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

By conducting thorough market research, organizations can uncover actionable insights that enable them to build better products and services for their current and potential customers. Insights may include the demographic profiles of your customers, information about their decision making process, or an overview of the key channels customers use to purchase your products and services. 

Market research has a huge variety of applications, and there are many different tools and strategies that researchers can employ to uncover insights on their target market. Potential applications may include testing new packaging concepts, or predicting the rate at which consumers might adopt a new technology.

Armed with insights from market research, organizations are able to make key decisions with a higher degree of confidence. Over time, organizations that have a deeper understanding of their customers, and the broader market, will always outperform those that don’t.

Market Research: A Brief Definition

Market research refers to the process of gaining a comprehensive understanding of an organization’s customers and wider market. Market research covers a broad scope, and tactics may include talking directly to customers, consulting secondary research on market conditions, and analyzing the activities of competitors

 

Market research typically makes use of both quantitative and qualitative research methods, and aims to build a clearer understanding of how an organization’s customers make purchasing decisions. Determining an appropriate market research strategy requires expertise. There are many methods for performing market research. It is important to have an expert team to guide the research strategy. 

Frequently Asked Questions about Market Research

As experts in the field, the team at Cipher receives a lot of questions about market research. Here are some of the most common:

  1. What’s the difference between quantitative and qualitative market research?
  2. What are the different types of market research?
  3. What are the limitations of traditional market research?
  4. What is predictive market research?
  5. What tools do I need to do predictive market research?

What’s the difference between quantitative and qualitative market research?

While it would be convenient if there were a one-size-fits-all approach to market research, the reality is that the best way to conduct market research is highly subjective. The strategy driving the research, and the tactics used to execute it, are dependent on the questions an organization wants to answer by conducting market research. 

Broadly speaking, market research can be either quantitative or qualitative. The best approaches to market research utilize both of these approaches in harmony.

Quantitative research methods pose questions to respondents in a very structured way. Approaches to quantitative research include surveys, polls, and A/B testing. The research yields quantifiable results: for example, in testing new product concepts, the research might determine that customers prefer Concept A 15% more than they prefer Concept B. 

Qualitative research seeks to uncover the “why” behind the ways that customers make decisions. In qualitative research, data tends to be unstructured, but uncovers deeper insights that explain customer behavior. Common approaches to qualitative research include unstructured interviews, focus groups, and customer observations.

What are the different types of market research? 

In addition to the quantitative vs. qualitative buckets of market research, primary and secondary research are also considered two distinct branches of market research. Both are valuable, and organizations should aim to include both primary and secondary sources in their overall marketing and competitive intelligence strategy

Primary research gathers first-hand information directly from research participants. Typically, primary research begins with exploratory research, which uses qualitative research methods to discover the issues the research should focus on. Once the scope has been defined, market researchers can use more specific quantitative research methods to answer questions in a more structured way. 

Secondary research is the process of incorporating existing bodies of research and data into the overall market and competitive intelligence strategy. Examples of secondary research might include industry reports, banks of data from reliable sources, or news media. Due to the number and variety of sources that exist, navigating secondary research can be time-consuming. Many organizations make use of platforms like Knowledge360Ⓡ to better collect, organize, and analyze secondary market research. 

What are the limitations of traditional market research?

Market research as we know it today has been around for nearly one hundred years, and was first pioneered by psychologist Daniel Starch in the 1920’s. Clearly, market research has stood the test of time. However, there are some limitations to traditional forms of market research, including:

  1. Response Bias: There’s often a significant difference between the behavior that research participants report and the behavior they exhibit when observed. 
  2. Difficult to Explore New Ideas: For truly innovative concepts, it’s challenging to get research participants to imagine how products or services would fit in their everyday lives.
  3. Uses Historical Data: By definition, market research uses historical data to try to predict the future. Market research initiatives can take months to execute, and by the time they’re used to inform strategic decision making, the insights can be stale and outdated. 

What are prediction markets?

Prediction markets are an alternative to traditional market research that address many of the limitations discussed above. They challenge research participants to bet virtual currency on how a target audience will react to say a new product or service, and then ask participants to explain the rationale behind their bets. 

This research method is proven to be more accurate, using an algorithm that predicts outcomes, rather than just capturing opinions. By asking participants to predict the behavior of others, a prediction market reduces the impact of response bias. Even better, prediction market research can be conducted three to five times faster than traditional market research. 

What tools do I need to do prediction market research?

HUUNU™ Futures offers a new type of prediction market that enables organizations to accurately predict and forecast future trends, growth likelihood, and timing. By using an advanced platform like HUUNU, organizations can quantify trends, assess market potential, and gain an understanding of when something will happen.  

Knowing something with happen isn’t enough anymore. You need to predict the speed and size of trends and customer needs to prioritize where you need to invest. With these forward-looking insights, organizations can make decisions with a higher degree of certainty, and ensure that they’re skating towards the puck, not endlessly chasing competitors.

Final Thoughts on Market Research

The value of market research is abundantly clear: to provide organizations with reliable, up-to-date information so that they can make informed decisions about the strategy of the organization. 

Traditional market research techniques play a role in that, but as we’ve seen, there are limitations that hamper their efficacy in accurately predicting customer behavior and future trends. A more optimal approach embraces both traditional market research methods and innovative prediction market tools. 

Organizations seeking to incorporate prediction markets into their approach to market research need look no further than HUUNU Futures, Cipher’s groundbreaking new prediction market software platform. Our consultants will work closely with your organization to design a comprehensive research program that delivers reliable results. 

To learn more about HUUNU Futures, schedule a demo call with our team. 

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