Market research, not to be confused with marketing research, is the process of identifying various kinds of information that can help to get a product from its maker to its consumer. This includes identifying market trends, competition within a market, customer satisfaction levels, the needs of specific target markets and general market information. A market research firm provides this kind of information to businesses that use it in an attempt to grow.
It is almost mandatory that a business know what is going on with its particular marketplace at any given time. Market information helps a business to identify the kinds of products that should be sold, current products that should be dropped, service needs within the industry, what the competition is doing, and how that is likely to impact the business in question. A market research firm also gathers information such as whether a company's customer service is adequate or if it needs to be improved. This kind of market analysis helps to keep a company profitable by working to satisfy the company's customers.
Many businesses do not have the time or the expertise to conduct market research on their own. Any kind of in-depth look at market requirements is often handled by specialized industry consultants at a market research firm. That is the entire focus of market analysts, who can develop market research targeted especially to the needs of the business.
One of the main ways market research is conducted is through the use of surveys. Customers and potential customers are asked questions about product identification and satisfaction, likes and dislikes about various brands, shopping habits, spending habits, and anything else that might be applicable to the particular business in question. Those answering the survey questions are also asked demographic questions about such things as age, race, heritage, income, city, state, the number of people in the home and their age. All of this information is combined to help a business to understand who its customers are and who might be potential customers. If the business in question does not sell directly to consumers, the research will look at other businesses as customers rather than looking at individual shoppers.
To identify the information most important to a particular business, consultants from a market research firm will work directly with the business that has hired the firm to come up with methods and survey questions appropriate for that business. The researchers will then use various ways of collecting information, such as phone surveys, taste tests and online questionnaires. Once enough data has been gathered, the market research firm converts the information into statistics the business can use and presents it to the company. After that it is up to the company to decide how to proceed.