While there are many ways to perform market
research, most businesses use one or more of five basic
methods: surveys, focus groups, personal interviews, observation,
and field trials. The type of data you need and how much
money you¡¯re willing to spend will determine which techniques
you choose for your business.
1. Surveys. With concise and straightforward questionnaires,
you can analyze a sample group that represents your target
market. The larger the sample, the more reliable your results
will be.
In-person surveys are one-on-one interviews typically conducted
in high-traffic locations such as shopping malls. They allow
you to present people with samples of products, packaging,
or advertising and gather immediate feedback. In-person
surveys can generate response rates of more than 90 percent,
but they are costly. With the time and labor involved, the
tab for an in-person survey can run as high as $100 per
interview.
Telephone surveys are less expensive than in-person surveys,
but costlier than mail. However, due to consumer resistance
to relentless telemarketing, convincing people to participate
in phone surveys has grown increasingly difficult. Telephone
surveys generally yield response rates of 50 to 60 percent.
Mail surveys are a relatively inexpensive way to reach
a broad audience. They're much cheaper than in-person and
phone surveys, but they only generate response rates of
3 percent to 15 percent. Despite the low return, mail surveys
remain a cost-effective choice for small businesses.
Online surveys usually generate unpredictable response
rates and unreliable data, because you have no control over
the pool of respondents. But an online survey is a simple,
inexpensive way to collect anecdotal evidence and gather
customer opinions and preferences.
2. Focus groups. In focus groups, a moderator uses a scripted
series of questions or topics to lead a discussion among
a group of people. These sessions take place at neutral
locations, usually at facilities with videotaping equipment
and an observation room with one-way mirrors. A focus group
usually lasts one to two hours, and it takes at least three
groups to get balanced results.
3. Personal interviews. Like focus groups, personal interviews
include unstructured, open-ended questions. They usually
last for about an hour and are typically recorded.
Focus groups and personal interviews provide more subjective
data than surveys. The results are not statistically reliable,
which means that they usually don't represent a large enough
segment of the population. Nevertheless, focus groups and
interviews yield valuable insights into customer attitudes
and are excellent ways to uncover issues related to new
products or service development.
4. Observation. Individual responses to surveys and focus
groups are sometimes at odds with people's actual behavior.
When you observe consumers in action by videotaping them
in stores, at work, or at home, you can observe how they
buy or use a product. This gives you a more accurate picture
of customers' usage habits and shopping patterns.
5. Field trials. Placing a new product in selected stores
to test customer response under real-life selling conditions
can help you make product modifications, adjust prices,
or improve packaging. Small business owners should try to
establish rapport with local store owners and Web sites
that can help them test their products.
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