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Carrying out customer research on loyalty, satisfaction and services can make a big difference to your business. If you know how your existing and potential customers make their buying decisions, you can adapt your sales methods to fit their needs.

Who are your customers?

Knowing demographic information about your customers can help with your marketing and sales plans. Consider factors such as:

• gender
• age
• occupation
• income
• lifestyle
• attitudes

What do they think?

Knowing what your customers think of your products and service and how they rate you against your competitors will enable you improve your business offering. To target your customers successfully, you should know as much about their buying habits as possible. Consider the following aspects of your customers:

• interests
• needs
• buying behaviour, including when and how they buy
• preferences
• opinions about your brand
• opinions about competitors 

Read the ten things you need to know about your customers.

Understanding market trends is important if your business is to make the most of its opportunities and stay competitive. You also need to understand your competitors and be aware of what they are doing to predict their next moves and exploit any weaknesses.

Try to get answers on:

• Is demand for your product or service growing or shrinking?
• What are the current economic and market trends?
• How might customer needs and buying behavior change?
• What new products are competitors developing that could outdate yours?
• What are competitors' plans and changes?
• What do competitors offer, and at what prices?
• What do competitors offer, and what prices do they charge?
• How do competitors advertise and promote?
• Is there any upcoming legislation which could impact your market?
   

Once you have identified the information you need, you can start gathering it. Sources of market research may be 'primary' or 'secondary'. It is a good idea to first conduct secondary market research, then do your own primary research.

What is primary market research?

Primary market research is either conducted by your business or by a research agency you have hired. It is also known as 'field' research. It is tailored to find the specific information your business needs. You could use it to test customer opinion on your new product or learn how your audience perceives your brand.

Some examples of primary market research include:

• questionnaires
• focus groups
• examining your businesses own data eg sales and inquiries
• customers' online behaviour

What is secondary market research?

Secondary market research comes from information already gathered by external organisations. It is also known as 'desk' research. It provides general information about the market and isn't based on your own business. There are many free sources of secondary market research. The research may be detailed and useful, but it isn't tailored to your specific needs.

Sources of secondary market research include:

• your local business reference library (such as Invest NI's )
• your trade association
• your local council or chamber of commerce
• the for information on the economy, population and social trends
• business news, including online, local newspapers and business or trade publications
• commercial publishers of market reports - including KeyNote, Euromonitor, Mintel, Datamonitor, The Economist Intelligence Unit and Market & Business Development

For other useful sources of data, see how to do competitor research.

Although there is a lot of market information available, you need to be careful about how you interpret it.

External data might not be in a format that's easy to use. It may have been collected for different purposes or be from a range that doesn't align with your target market.

Take care to avoid the pitfalls of inaccurate and misinterpreted data when using secondary market research.

Inaccurate information

Beware of out-of-date market information. This can be misleading, as the market may have changed significantly since the information was published. It can be particularly hard to tell how recent any information published online is. Some information on the web can be unreliable or biased

Misinterpreted information

Remember that statistics can sometimes be misleading and mask the true picture. For example, an 'average' income for the population in your area might conceal a high proportion of low earners. This means fewer people can afford your product than it appears.

The same principle applies to your own sales records. One or two major customers could distort the picture.

Biased research

Most importantly, don't make up your mind in advance. Finding market information that confirms what you already believe is easy. However, only a realistic picture of your customers and markets will be helpful to your business.

Field research, also known as primary research, can be quantitative or qualitative:

• Qualitative field research examines people's feelings and attitudes towards your product or service. It looks into what motivates them to make a purchase. 
• Quantitative field research provides statistical information. For example, how many potential customers there are and what their average incomes are.

• test customers' reactions to a new product, and adapt it if necessary
• investigate the attitudes of customers and potential customers
• find information specific to your business or a local market, rather than the market as a whole

What are the methods of qualitative field research?

The research normally involves recording and transcribing the interviews or focus groups. The researcher can then analyse the transcriptions. They will look for themes that reveal the participants':

• underlying views
• behaviour triggers and barriers

You can use qualitative research can be used to discover consumers':

• motivations
• needs
• reactions to message and new products

You can also use qualitative research to come up with new concepts. 

Examples of qualitative research for gathering marketing information include:

• focus groups
• in-depth interviews

What are the methods of quantitative field research?

Quantitative research is statistical. Therefore, it's important to use a large enough sample size so your results are meaningful. The larger your sample, the more reliable your data will be.

This type of research is useful for finding trends in:

• consumer preferences
• feelings of importance and satisfaction
• patterns in behaviour
• demographics 

Examples of quantitative field research may include:

• questionnaires with closed questions
• online surveys
• telephone, on-street or postal surveys

Good planning is essential if you want to get the right results from field research (also called primary research) to gather market information.

How will you gather the necessary market information?

First, you need to decide how to collect the information you want. There are several popular methods.

Surveys

Use a set list of questions to gather information. The most effective way of carrying out a survey is usually face-to-face, but you can also use phone interviews, online questionnaires, or mail surveys.

Discussions

Discussions are often held in small focus groups or one-on-one in-depth interviews. These are good for qualitative research, as they allow you to explore people's attitudes in more detail.

Observations

You can watch what people do instead of just asking them. For example, see how shoppers behave near a specific point-of-sale display in a store.

Experiments

You can test something out, like having people do a blind taste test of your drink versus a competitor's. Another way is to give a customer your new product and ask for feedback.

How do you execute market field research?

Once you have decided how you'll gather the information, you'll need to work out how to make it happen. Budget how much time and money will be needed, as the time involved will normally be significant.

You'll need to design your research. For example, drawing up a questionnaire or deciding how you'll run a focus group.

Then there are the logistics. If you want to carry out street interviews, make sure your researchers have the required local authority licence and identity card. If you want to run a focus group or conduct face-to-face interviews or product tests, where will you hold them? Where will you find the participants? And who'll run the session?

Consider carefully whether you have the skills in-house to do this. If not, it's probably a good idea to get a market research agency to do your research for you.

Read six tips for successful primary market research.

How you conduct your primary field research will have a significant impact on the quality of the results. Keep these key points in mind when doing and interpreting your research.

1. Ask the right questions

Badly phrased questions can give you wrong answers. Avoid yes or no questions. For example, asking customers of your stationery shop if they plan to buy pens doesn't tell you what kind of pens they want.

2. Talk to the right people

Make sure you're asking the right audience. A survey at a train station will get answers from commuters, not from stay-at-home parents, if that's your target market.

3. Talk to enough people

Surveying just a few people isn't enough. Many experts recommend getting responses from at least 150 people to get a clear picture.

4. Keep research impartial

It's easy to encourage people to give the answer you want, for example, by asking leading questions or smiling at the 'right' answer. Discussions, where you're not working from a list of set questions, are particularly easy to distort. In focus groups, strong opinions from a few people can influence others.

5. Interpret results with care

You need to make sure you draw the right conclusions from your research. Bear in mind that people may distort answers in the hope of affecting what you do. For example, they might say they would buy a product if it were cheaper. Qualitative research, where you're investigating feelings and attitudes, can be particularly difficult to interpret.

6. Be realistic

Don’t ignore negative feedback. Picking only the results you like and ignoring the rest can hurt your business. Be ready to change your plans based on all the data.

If you don't have the time or skills to carry out research yourself, consider using a market research agency. Consider the question, should I use a market research agency?

You may be able to do your own field research. However, it's often better and more cost-effective to outsource the job to professionals by using a market research agency. Read more about outsourcing.

Benefits of outsourcing field research 

The decision to outsource your field research might provide you with a number of benefits.

Expertise and quality

Market research professionals are likely to get better results. They've had experience in designing surveys, running focus groups and asking the right questions.

Impartial feedback

Customers may find it easier to be honest with an outsider. This is especially true when providing negative feedback.

Credibility

Customers might be more open and less suspicious that you're trying to sell them something if an independent researcher conducts the survey.

Objectivity

You may find it hard to be impartial. This is especially true if people criticise your business.

Finding the right market research agency 

For small-scale field research, your best option may be a freelance researcher. A market research agency won't usually take on projects with a budget below £3,000.

You can use recommendations from business contacts and you can also .

Before hiring a market research agency or a freelance researcher, check their reputation. Ask for a list of previous clients and contact them for feedback. Check if the agency or researcher has relevant experience. Consider how comfortable you'd feel working with them. And get a clear idea of fees for the services you want.

Check to see if the agency's researchers or freelancers fit your business's image. If they'll do street interviews, confirm they have the required local licence and ID.

Make sure you provide a thorough and clear brief. It needs to cover things like the business goals for the project. Also, the data the research should find and how you will use the results.

A business that understands its customers and their buying habits can sell more effectively. They can compete better with other suppliers. Understanding the market helps you target new customers and identify new opportunities. Follow these five tips for better market research.

1. Identify the information you need

Understanding market trends is important. It helps your business make the most of its opportunities. Keeping on top of trends helps you remain competitive. You also need to understand your competitors and be aware of what they are doing. This will help you predict their next moves and exploit any weaknesses.

2. Use market reports and other data

Support is available from a range of sources. For example, Invest NI's offers free access to extensive market research. They use company databases and worldwide market reports.

3. Use field research

Popular methods of field research include surveys, interviews and direct observation. The way that you conduct your field research will have a big impact on the quality of the results. Ask the right questions, talk to the right people, talk to enough people and keep research impartial. See difference between qualitative and quantitative research.

4. Interpret the information

Be careful how you interpret market information. External data might not be in a format that's easy to use. It may have been collected for other purposes. It could be from a range that doesn't tally with your target market. Also beware of out-of-date market information. See three market research pitfalls to avoid.

5. Consider using a market research agency

If you lack the time or skills to do research, consider using a market research agency. This is an option if you have budget available. Always provide the agency with a thorough and clear brief. You should include the project's business objectives, what the research should uncover, and details on how you will use the results. See should I use a market research agency?