Differences between Primary Market Research and Secondary Market Research
October 13, 2011 Leave a comment
I was asked today at a networking opportunity whether I did primary or secondary market research. My immediate answer was, “Well, both.” However, the question got my mind mulling over if people understand the difference between these two forms. Market research is a key aspect when starting a new business venture, product line or service. But both have positive and negative aspects associated with them.
Secondary Market Research
Secondary market research is research that was previously done for some other needs, but being used to support the research needs of the organization. Generally, this is used to either provide a foundation for a study you want to do or provide additional information that would be time and/or cost prohibitive to do on your own. Think of secondary research as something you would do when looking to buy a new car. You would look at car company and dealer websites, maybe even Consumer Reports or CarFax.com. These all have a lot of information done by others for their purposes, but to inform others of the subject topic. For business purposes, these are demographic studies, Census data research, or using other published research by market research organizations, trade associations, or other similar organizations. This can be done online a lot of times. [Side note, the US Census Bureau released the Summary File 1, SF1, recently. It can be found here.]
Primary Market Research
Primary market research is research specifically done for the needs or questions of the organization. This is done through either quantitative or qualitative market research. To read more about these, you can look at my last blog post here. Keeping with the car buying example from above, primary research would be talking with owners of the cars you are interested in buying, talking with the salespeople, and even taking a test drive. This is done specifically done by you for your purposes.
When dealing with a new opportunity, businesses should do both primary and secondary market research when they are looking at new business venture, product line or service. Companies and organizations should do secondary research first as it can be considerable more cost effective as well as provides some insight to the needs you are wanting to satisfy. Then primary research can follow once you get a better understanding of the market that you found in the secondary research.
What do you think about this?