Information is the king of business decisions. But it can be both time-consuming and expensive to collect actionable data. That’s where secondary market research comes in. This is an inexpensive and quick approach for the business to analyze data that already exists, thereby reducing time and funds while maximizing value. It’s a smart starting point if you want to know how to do market research for a product.
If you’re asking “What is secondary market research?” or how you can use it to grow your business, you’re in the right place because this guide will cover everything there is to know about it — from what it is and what its benefits are to examples and the steps required to successfully perform it. Knowing how to do market research for a product can save you both time and resources.
Secondary Market Research Introduction
What is Secondary Research?
Secondary market research is the process of analyzing data that has already been gathered, organized, and/or published by others, such as trade associations, agencies, organizations, or individuals. Secondary research: While primary research involves collecting new data using methods such as surveys or interviews, secondary research uses existing sources like reports, articles, sales data, and industry surveys.
Understanding how to do market research for a product involves learning how to efficiently access and interpret this kind of data.
Why Secondary Market Research is Important?
Secondary research is a valuable tool for gaining market knowledge, understanding trends, and supporting decision-making with data without having to incur the costs of collecting primary data. All-sized businesses utilize secondary market research to:
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Customer behavior and preference analysis.
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Compared to the competition.
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Assess industry trends and market dynamics.
The best insights often come from the intersection of secondary and primary research, but secondary research is often a good place to start when learning how to do market research for a product.
Merits and Demerits of Secondary Market Research
Advantages of Secondary Research
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Cost-Effective
With the information already assembled, secondary research can save a company money compared to the high-cost prospect of conducting primary research, such as a focus group or poll. -
Time-Saving
It is also much faster to tap existing studies, reports or data than to organize research from the ground up. -
Enhanced Context
Secondary research can put your business into perspective as part of the larger industry picture, allowing you to see the big picture. -
Accessibility of Data
There are so much data from authoritative sources like government agencies, research reports and academic papers for you to get freely.
Secondary Research Limitations
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Lack of Specificity
Secondary research may not be created specifically for your own needs, so it might not be as applicable. -
Outdated Information
Data can be too slow, particularly for rapidly evolving industries where old information feels dated. -
Data Bias
Historical data (secondary) is characterised by its inherent bias originating in the interest and need of the collector.
Secondhand research, however, is a valuable tool to be used with care. It’s important to keep these limitations in mind when learning how to do market research for a product using secondary methods.
Secondary Market Research Types
Internal Sources
Internal data is any information that your organization already has and can sometimes be very rich for research.
- Sales Records
Researching sales data can help you identify key trends in customer behavior, product performance, and seasonality. - Customer Databases
Your CRM tools are full of data that you can use to segment customers based on what they like, where they live, what they bought, and much more. - Financial Reports
Past financial information is a good guide to achieve revenue and expense estimates and overall business performance. - Employee Feedback
Internal surveys or employee feedback can surface operational improvements and customer insights from those who are closest to the data.
External Sources
External data is information collected by a third party, typically focused on general industry or macroeconomic trends.
- Government Reports
Detailed market information for specific industry sectors will be made available. The U.S. Census Bureau, for instance, provides comprehensive data on demographics and consumer behavior. - Industry Publications
Trade publications, research firms, and news organizations usually have information about market trends that may not be as aboveboard. - Academic Studies
Market studies are often run by universities or research institutions into conditions in the market, for consumer preferences that are available if a new technology emerges. - Competitor Data
Publicly shared competition reviews, press releases, or annual reports can be very helpful in understanding industry standards.
Knowing internal and external sources is crucial when learning how to do market research for a product effectively.
Secondary Market Research: How to Research Your Industry Market
Step 1. Establish Your Objectives for the Study
Begin by clarifying just what you want. Are you looking into new markets? Benchmarking competitors? Understanding the preferences of the consumer? An awareness of your objectives will help ensure that your research is directed and relevant.
Example Research Objective
“Insight in the competitive environment for sustainable packaging solutions in the retail segment.”
Defining clear goals is the first key to understanding how to do market research for a product.
Step 2. Datasource Identification and Assessment
When you know your aim, write a list of the sources you can turn to. Make sure to evaluate:
- The publication or institution’s credibility.
- How relevant is the data to your needs?
- How recently was the information last updated in order to reflect current trends?
Pro Tip
Combine those sources! For instance, rely on government reports for industry averages and then layer in CRM data for customer-specific insights.
This is a vital stage in how to do market research for a product.
Step 3. Interpret Your Findings
It’s in the analysis where the magic lies, once the data is collected. Search for patterns, correlations, and actionable insights that address your original research questions. Cross-check with other sources to verify and minimize bias.
Example
If commissioned external research states that more and more people are eating plants, and your own sales data shows an increase in the number of vegetarian dishes being ordered, it suggests it’s a carnivorous expansion.
Learning how to do market research for a product means knowing how to extract meaning from numbers and trends.
Step 4. Validate Findings
Finally, share your findings with stakeholders and, if you can, try them out in small initiatives or pilots. This is a good way to make sure that your data is aligned with your business strategy.
Validation is the final checkpoint in how to do market research for a product before implementing your findings.
Real-Life Examples of How Secondary Market Research is Put into Play
Example 1. Launching a New Product
A food delivery start-up could look up external market research reports and find pent-up demand for vegan meals. Then they might make this a double with some internal, customer preference analysis before deciding to launch a plant-based menu.
This is a practical demonstration of how to do market research for a product using both internal and external data.
Example 2. Expanding to a New Market
Based on existing government data around demographics and consumer spend, an organization may look into when they enter new countries, the competitor case studies from similar territories.
Example 3. Benchmarking Competitors
For example, a beauty brand might read industry magazines discussing their competitors’ digital marketing tactics, and pair that with social media analytics to better their own approach.
All of these cases illustrate how to do market research for a product with real-world implications.
Utilising Secondary Market Research for Growth
Secondary research is a critical component of building an informed, data-driven business strategy. If you effectively leverage available internal and external resources, set clear goals, and validate findings, you will surely be able to get the value.
For market research novices or for those who need help analyzing insights, there are tools and platforms that can help make the process easy. They cut down on time wasted and help you make quicker decisions based on sound data.
Ultimately, learning how to do market research for a product gives you a strategic edge in today’s data-driven economy.
You can also know about: How to Conduct Market Research for Small Business