Market research is a method businesses use to identify patterns in consumer buying and predict future buying habits. It could potentially save a company millions if they know whether consumers will be repulsed by, attracted to, or indifferent to a product concept in development. These research reports can be developed in several ways and for varying purposes.
The first step in all research reports is to identify the purpose. All research reports are designed to gather knowledge to make a more informed decision before investing money into a concept, to determine the direction of a business venture or to decide whether to eliminate a product or service. Identifying the purpose of the report helps to direct the approach of the research-gathering efforts. The report may sell an idea or change management's mind about an idea. Reports can also be used to identify and rectify a problem within a company.
It's important to first collect data that has already been collected by other sources. Published reports from research firms such as Plunkett and Forrester can be reviewed to avoid doubling efforts already made. Sales invoices, customer information and other internal documentation you have can also be used. First-hand data should be gathered by asking the questions that haven't already been answered. It should also be collected if the information available is outdated. Interviews and questionnaires of consumers are among the most used methods to gather information.
Statistical research attempts to learn how much of the population uses certain products, predict trends involving the product, and identify the audience that buys the product. This form of research is also called descriptive research and is generally used to understand what impact a product may have on the target market. Descriptive research could be used to establish a control group for future research studies the company may commission.
Exploratory research is a strictly information-gathering form of developing a research report. This method is used when the problem hasn't been identified. It helps clarify the best way to collect data, choose subjects to study and research models. Secondary data, such as expert opinions and previous studies, are the primary source of information. Case studies and data gathered through focus groups are also used.
Causal research begins at the point at which the previous research gathered has helped the researchers to develop a hypothesis. The causal research is the testing phase for the hypothesis developed. An editor of Entrepreneur Magazine says that this research is important because, "Popular opinion and procedures are not necessarily reliable guides to best practices." In his summation, causal research is the method to test the assumptions of exploratory research and descriptive research.
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