Primary and secondary research

Marketing information is widely available from a variety of sources both inside (internal) and outside (external) the firm. Sources of historical data can be classified as being:

Private to the firm itself - the firm's own records. Its own sales records etc.
Externally purchased or private data - market research firms will do surveys and will provide allow access for a fee. This may be more cost-effective than the firm conducting its own research.
External public domain information - government provided information about the economy. Publications of the National Statistical Office etc. Much of this information is free of charge.

Research can be classified as:

primary or secondary
qualitative or quantitative

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Primary research

Primary research is the gathering of new or 'first-hand' data specifically tailored to provide information on the firm's own products, customers and markets. Data is collected by fieldwork such as questionnaires, observation, experimentation and surveys and, as a result, is often expensive, but also directly relevant, accurate and up-to-date.

Primary data can be collected from internal or external sources. The firm can interview its own employees or it may collect external data through questionnaires and surveys.

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Secondary research

Secondary research, also known as desk research is the assembly, collation and analysis of existing or 'second-hand' marketing data. This process is cheaper than primary research, but the data may be less relevant as it was not collected for the specific needs of the firm and may already be out of date.

There is an immediate and obvious clash here between the two types of market research - cost versus time and accuracy!

Secondary data may be collected from some of the following existing sources:

Internal: annual reports, sales data, customer records and survey, client databases, payment records.
External: government data, national and local media, competitor reports, reports of marketing research companies, trade association data and reports, company websites

The following summarises the advantages and disadvantages of secondary data in comparison to primary data

Advantages of secondary data	Disadvantages of secondary data
Quicker and cheaper to collect and analyse	Quickly out-of-date
Wide range of potential sources	Available to competitors
Provides data on the whole industry and/or economy rather than focused on the firm	Not specific to the needs of the firm and may not be in the format required for analysis

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Qualitative research

Qualitative research is in-depth research into the motivations behind customer purchasing behaviour and attitudes, providing information on preferences, tastes, and buying habits. Information is gathered through the use of detailed and often lengthy research methods often involving the use of discussion, or 'focus', groups.

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Quantitative research

Quantitative research concentrates on statistics and other numerical data such as market share, gathered through opinion polls and customer surveys.

Qualitative research asks 'why' customers buy and elicits their opinions - it can provide information of the strength of demand and on feelings. However, this type of information is difficult to present in a succinct form. Quantitative research asks questions about magnitude relating to who buys the product and how much they buy. This kind of data is much easier to graph and present visually.

So, as we can see the information for market research can be gathered by examining existing data, or going out and collecting new data. The two main methods for market research are defined as:

Desk research - working in house or in the office, using existing, 'secondary', data. Gathering the information can be quick and inexpensive because the data already exists, but may be imprecise, inaccurate, out-of-date and not focused on the specific need of the firm. Desk research can be useful for screening or 'first evaluation' of a proposal simply, because it is quick and cheap.
Field research - going out into the market, in one form or another, and collecting new, relevant information. It will be slower than desk research, and more expensive, but it should be far more accurate and directly relevant. It can often fill in the gaps left by desk research.

The firm is faced with a trade-off between cost and accuracy. The choice may be determined by the firm's budget and/or the nature and size of the financial risks involved. Larger firms with significant research budgets will clearly be at an advantage over smaller firms. Most large firms are likely to use a combination of primary and secondary research.

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Market research types

Choose appropriate options from the selection below to make up an appropriate description of different types of market research.

research data originates as a direct result of the research you are engaged in (from , questionnaires and so on), whilst (or desk) research refers to information that already exists as a result of another piece of work (maybe or a market report from another firm). Research can also be classified as material from within the firm () and material from outside (). Desk research will tend to be relatively while primary research will tend to be relatively more .

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Types of market research data

Match the description below to the appropriate data type.

Marketing

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