Market Research Basics: What is Market Research?

Doing market research is like a cross between a scavenger hunt and a jigsaw puzzle.

Except you don't have a guide picture to follow, and the puzzle pieces are scattered all over the house. The puzzle pieces are the information you need, their hiding places are the information sources, and the final picture will be an understanding of your market.

There's no one magic information source that has all the answers. And sometimes, the information or data you're looking for may not even exist. Don't get discouraged! There are often alternate places to look or ways to search.

What is a market research definition?

Market research is "The process of gathering, analyzing and interpreting information about a market, about a product or service to be offered for sale in that market, and about the past, present and potential customers for the product or service; research into the characteristics, spending habits, location and needs of your business's target market, the industry as a whole, and the particular competitors you face" (source).

Essentially, it helps you answer some of the following questions:

• What is the size of my market?
• Who are my competitors?
• Which market is best suited for my product or service?
• How much will customers pay for my product or service?
• What are the emerging trends in an industry?

(source)

These questions can be roughly divided into two categories, Industry Questions, and Market Sizing & Customer Discovery.

The best market research is a combination of primary and secondary information.

Primary information: research you compile yourself or hire someone to gather for you.

Secondary information: This type of research is already compiled and organized for you. Examples of secondary information include reports and studies by government agencies, trade associations or other businesses within your industry.(source)

This module focuses on secondary research.

The next section defines the information sources you will likely use in researching your market.