Step by Step Guide to the Market Research Process

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Twitterversity - A Step by Step Guide to the Market Research Process

 

The market research process requires making decisions at many steps that can be overwhelming for non-researchers put in charge of research projects. I found the chance to help and share my experience when I got invited to teach a Twitterversity class under the topic “Principles of Market Research Project Management”, a Twitter-only event organized by Research Rockstar. For those who missed it and for those who attended and want to see all the tweets I sent under the hastag #MRXU on 7/28, in one place, here they are.

 

Consider the following 7 steps during the implementation of a market research project:

 

STEP 1. DEFINE THE RESEARCH OBJECTIVES

 

  • This is the most important step. It sets the direction of the whole market research process.
  • Ask clients how they will use the research results, what business decisions they will make based on the data. They should be specific
  • Do some background research, interview key stakeholders and research users to put the research objectives into a greater context
  • Gain consensus among key stakeholders on the main research objectives. Get them involved from the start
  • Avoid objective creep. Don’t try to research everything under the sky in a project. Focus on what’s needed for decision making
  • Trying to cram many things in a project because of budget constraints is often a waste of money as data quality suffers
  • Discuss limitations early in the process. Set clear expectations of what the research will cover and what data it will provide
  • Check if previous research has been conducted on the same issue to avoid effort duplication and waste of money
  • DO NOT select data collection method before establishing clear objectives and identifying target population

 

STEP 2. DETERMINE THE BUDGET

 

  • How much are the key stakeholders willing to invest in the requested research? Get a number!
  • If there is no commitment to a budget, you will be wasting your time (RFP) and your research vendor’s time (proposal)
  • There is always a trade-off between research quality, deadline and cost. Make your internal clients aware of that
  • There is a limit to “better, faster and cheaper” in market research. Push it too hard and you will get fast, cheap, crappy research
 
STEP 3. DEFINE THE TARGET POPULATION FOR THE RESEARCH
 
  • Who do you want to gather data from? Customers? Non-Customers? Category users?
  • Sample definition helps decide on what data collection method we use. More than one method may be needed. To read more about mixed-mode  data collection check: Mixed Data Collection Modes – Round-Up
  • Create clear screening criteria. Discuss them with key stakeholders. Make sure they align with the research objectives.
  • Discuss the caveats and limitations of the sample definition and how they will affect the results and decision making
  • Be realistic. Given your budget, you may or may not be able to reach your target population

 

STEP 4. DEVELOP THE ANALYTICAL PLAN

 

  • Based on the decisions that will be made, determine what type of data is needed and expected
  • Select analysis techniques that help you reach the research objectives and provide data that research users are expecting
  • Example: Need to know how to price a new product before it goes to market? Conjoint analysis may be a good fit. Check: Conjoint Analysis And Realism In Price Research
  • Example: Need to pick the product name that elicits the highest purchase intent from a list of 30? Consider MaxDiff. Check: Making the Case for MaxDiff
  • Example: Need to find new growth opportunities? A segmentation research can help to find segments with the highest potential. Check: Segmentation is Key to Success
  • Think objectives firsts, methods second. Not the other way around
  • Determine sample size based on your tolerance for risk.  Check Sample Size Matter
  • A large sample doesn’t guarantee representativeness. Check: Does A Large Sample Size Guarantee A Representative Sample?
  • The analysis techniques selected will also influence the decision on sample size

 

STEP 5. DEFINE DATA COLLECTION METHOD

 

  • Objectives, sample, analytical plan & cost have the highest influence on which methods we use
  • Be open to use hybrid approaches combining qualitative and quantitative data collection methods
  • Ideally, if budget permits do qualitative research before or after quantitative research
  • Consider qualitative research for exploration before quantitative and deep diving after quantitative research
  • Consider quantitative research if a go/not go decision will be made. DO NOT make these type of decisions based only on qualitative research
  • Discuss which methods are the best fit to research the target pop. Some target groups may be difficult to reach with the same method
  • If you decide on mixed-mode surveys, be aware of potential measurement errors each mode introduces. Check: Understanding the Pros and Cons of Mixed-Mode Research
  • Once the data collection methods are selected, determine if you can do it with internal resources or need a research vendor
  • If time, staff or lack of tools are limitations, consider outsourcing the project to an external research vendor. For more on this check: When Do You Need A Market Research Vendor?
  • If you have access to a customer database with emails, use it for studies related to customer retention goals and new product development
  • For customer acquisition efforts use samples of non-customers in the category
  • If the study is online get bids from multiple online panels.
  • Don’t buy third-party email lists and blast them with survey invites. It is illegal (SPAM-CAN Act)
  • If you are doing surveys, put time into its design. To create surveys that gather quality data check: Using A Strong Questionnaire To Harvest High-Quality Data
  • Considering focus groups? Check if it makes sense here: When Using Focus Groups Makes Sense
  • If you are doing focus groups, avoid common mistakes. To know which they are, check: Common Mistakes When Doing Focus Groups
  • Don’t forget about new online qualitative research techniques. Check: Online Qualitative Research Techniques Review

 

STEP 6. COLLECT DATA

 

  • Get involved, monitor. Do a soft launch if you are doing online surveys to catch any potential problems

 

STEP 7. ANALYZE & REPORT

 

  • Keep the key objectives in mind to connect market research to business impact. Check: How To Connect Market Research To Business Impact
  • Share preliminary results with key stakeholders, discuss, check if they make sense from a practical stand point
  • Focus on the story behind the numbers and how it supports your recommendations. Don’t do a data dump. Focus on insights

Comments Comments

Sandy Yost Posted: August 8, 2011

Michaela,

This is one of the best guides I have seen. You have clearly and accurately captured many, if not all, of the critical elements needed to design and execute QUALITY research.

Coming from the client side (Fortune 100 CPG), I have lived through years of unwillingness (on the part of internal clients) to follow these principles due to limited budgets, a need to gather “some data,” a need to meet personal objectives, or feelings by the stakeholders that following these principles is not important.

Whereas, if the principles had been adhered to, it likely would have prevented the loss of millions of dollars in wasted research expenses, human capital, manufacturing expenses, and failed product launches.

As you noted, step one is absolutely critical. Are there any strategies that you employ to help ensure step 1 is achieved? Do you ask clients to ‘document’ their objectives and decision criteria?

Michaela Mora Posted: August 8, 2011

Sandy,
Thanks for you comment. My main strategy is to keep asking questions about how the information will be used, what type of decisions the data will allow us to make and how they will impact the business. You have to help your clients think through the objevtives by visualizing what they can do with the results (e.g. if we get this data from this target pop, we are able to make decision X which will be limited to y, w and z market conditions). I also discuss the caveats of the different paths we may take in the research. There are always pros and cons in the world of limited budgets and tight deadlines. Documenting is always very helpful, since it forces your clients to think what they really want before they put it in writing. So ask the questions in writing and ask for answers in writing. If you have a verbal discussion about the objectives, summarize what it was discussed and then ask for confirmation of your interpretation and add the pros and cons of the research approach suggested by the discussion. You may have to do several rounds of this back and forth but it is worth it in the long run.

Sandy Yost Posted: August 21, 2011

Thanks for the follow-up. I agree that asking a lot of questions and helping clients work through objectives is key. If possible, I think the key stakeholder or the one responsible for delivering the results should document the objectives and decision criteria by putting it in writing themselves, or at minimum do so upfront. It may not be where you/they end up, but to document something oneself means you must fully evaluate options/alternatives and what you’re hoping to achieve. So, the more a client puts objectives in writing the better defined the project will be. Of course, there’s always a fine line between asking them to do so and being a good service provider; thus my question. I’d love to hear what strategies MR providers have found work best for them.

Again, great guide!

Michaela Mora Posted: August 21, 2011

Totally agree with you Sandy. Writing down the objectives forces client to think through what they want from the research. Thanks for your comments!

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