Companies that understand precisely what their customers need do an excellent job of fostering customer satisfaction and retention. The value of retention is unmatched, considering boosting customer retention rates by just 5% increases profits anywhere from 25% to 95%, according to Bain & Company.
However, it’s critical to remember that the ability to obtain a complete view of your customer depends largely on the integration of accurate data from different sources, including CRM data, marketing analytics, and, especially, market research.
Additionally, your business decisions are only reliable if your data collection methods are solid. In other words, if you miss the boat when it comes to collecting data, then your business decisions won’t be based on accurate results.
Choosing the right techniques to conduct market research is the first step to beneficial data collection. This article will provide a quick overview of the five types of market research techniques you can use, and when you should use each different method.
5 types of business research methods
When it comes to market research methods, you have five main options. Here is a brief overview of each type of research technique.
1. Surveys
Surveys are one of the most popular quantitative research methods, but they can also be used to collect qualitative data. Surveys include a series of well thought out questions related to your research objective. When using a survey, researchers will distribute the questionnaire to a sampling that is representative of their overall population or customer base.
With enough participants, researchers can elicit data that provides information about customer attitudes toward products, marketing, customer service, and more. You can distribute surveys face-to-face, but most market researchers distribute surveys using an online tool like Qualtrics or Survey Monkey.
2. Interviews
Interviews are another excellent research method, and best used when you need to gather more information that you would need from a short survey. Interviews are a guided conversation where the researcher is asking pre-determined questions to a participant.
Depending on what you need from an interview, you can either have a set batch of questions that you ask every interviewee, or you can create a guide of questions that will help lead the interviewer through the conversation. You can conduct an interview face-to-face, on the phone, or online.
3. Observation
One caveat to interviews is sometimes interviewees will self-report data that isn’t completely true. In other words, they will report what they think they do, which is different from what they do.
Some market researchers will conduct a site visit where they observe interactions outside a traditional lab in a natural environment. Other times, researchers will bring participants into a lab with controlled variables and observe them there.
4. Focus Groups
A focus group is a qualitative research method where researchers bring in a small sampling of their target population. During a focus group, researchers will ask their participants detailed questions about their perceptions, attitudes, opinions, beliefs, and experiences with regards to a service, product, or idea.
5. Testing
Testing is a research technique that involves market researchers either observing participants use a product, service, or interface to determine utility, or getting customer feedback on what they like best about a product, website, advertisement, etc. There are several different types of tests. Here is a closer look at some popular market research tests.
Usability testing: Usability testing is when market researchers elicit the help of a group of representative users to determine how easy a design is to use. Market researchers will usually observe users while they try and complete tasks for different designs. Usability tests are often repeated so developers can work out all the bugs before launch.
A/B testing: A/B testing is a type of test that presents two versions of a website, Option A and Option B, where only one variable is different. Based on user feedback, or observation, researchers can determine which website option is more effective.
Copy testing: Copy testing is a market research method that helps leaders determine the effectiveness of an advertisement. Researchers draw conclusions based on consumer responses, behavior, and feedback.
Testing is an excellent way to find out what your target audience prefers before launching a product, interface, website, or marketing campaign.
Which business research method is best?
Each of the five market research methods is valuable in their own way. Determining when to use which method depends on your research question and what you are trying to accomplish with your study. Here is a quick overview of when to use each different research technique.
When should you use a survey?
A survey is a good market research technique when you have a simple and defined question that you want an answer to. For example, a C-SAT (or customer satisfaction survey) will tell you how satisfied your customers are with a product or customer service experience.
When should you use an interview?
An interview is a good tool to use when you need to delve deeper than a typical survey will allow. For example, you may want to know how a customer feels about your products compared to a competitor’s product. An interview can help you get detailed and emotional responses.
When should you use an observation?
An observation is an excellent market research technique when you need to understand how your target customers behave in their natural environment. It is also a good technique to use if you’re worried that self-reported answers won’t be accurate.
When should you use a focus group?
Focus groups are an excellent tool when you want direct feedback in the form of a conversation from a small group of product users or potential customers.
When should you use testing as a market research tool?
Market researchers should engage in testing any time they want to work out bugs before launching a new interface. Testing is also a great technique to use to see what your audience will respond to better before you launch a new campaign, website, or product.
Wrap Up
To make data-driven business decisions, you must engage in market research. Each of the five market research methods listed above will provide different and valuable insight into business questions you need to be answered to stay competitive.
For more information about how to conduct quality market research and for a look at a tool that will help you with data analysis, request a Fuel Cycle demo today.
