The Role and Importance of Secondary Research in Market Analysis
One main focus of secondary research is to make your primary research step better by laying the groundwork for a better understanding of your marketplace, and principal business problems.
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Having spent the better part of three decades of my career now in the market research industry, I can safely say I’m what you call a battle-tested veteran. I believe in our work, and I have witnessed firsthand the transformative power of market research in enabling businesses to make informed strategic decisions that would change the course they would take and, ultimately, their outcome.
As practicing researchers, we principally focus our attention on primary research, where data is collected directly from the source. Then there is secondary research, or “desk” research, which entails the analysis of existing data sources. While primary research often receives the lion’s share of attention, secondary research plays a vital role in the overall market analysis process.
I think it is important to review the various aspects of secondary research in supporting primary research initiatives and shaping a holistic understanding of the market landscape.
In this blog, I will delve into three principal aspects of desk research that provide the background and context for its current place in the market research process. Specifically, the role, process, and significance of secondary research.
The role of secondary research
The main intention of the secondary research process is to make your primary research step better. It accomplishes this goal first by laying the groundwork for a better understanding of your marketplace, and principal business problems.
Often times, businesses rush into online surveys, attempting to understand their customers or their competition without having a complete understanding of all the relevant questions to be asking. Secondary research will help you in a number of areas, particularly when entering a new market.
Think of Porter’s Five Forces:
- Competition in the industry
- Potential of new entrants into the industry
- Power of suppliers
- Power of customers
- Threat of substitute products
This is a good template to use when categorizing your secondary research questions. You may then begin using those questions to inform your primary research design and, ultimately, your quantitative analysis.
- Identifying research gaps: Desk research enables marketing researchers to review existing data on a particular market or industry, helping them identify gaps in knowledge that warrant further investigation through primary research. This step ensures that your new research projects are informed by as much relevant information as exists in the marketplace and can be targeted to generate valuable insights that complement prior findings.
- Informing primary research design: By examining the methodologies, scope, and limitations of previous studies, this process can guide the development of primary research designs. It can help researchers refine their research questions, select appropriate data collection methods, and identify potential biases or pitfalls in existing research.
- Contextualizing primary research findings: Secondary research provides the necessary context for interpreting primary research results. By comparing new findings to existing data, researchers can better understand the significance of their results, identify patterns and trends, and assess the generalizability of their conclusions. Any market segmentation, forecasting, or predictive modeling (conjoint analysis) you may do later will ultimately depend on accurate marketing sizing to be of maximum use, so your secondary research is essential.
The process of secondary research
- Identifying data sources: The first step in secondary research is to identify relevant sources of information. These can include academic articles, industry reports, government statistics, trade publications, and even your own CRM system. It is crucial to ensure that the sources are credible, up-to-date, and pertinent to the research question.
- Evaluating data quality: Once sources have been identified, the researcher must assess the quality of the data, considering factors such as the methodology used, the sample size, and the validity of the findings. High-quality data will provide a more reliable foundation for market analysis.
- Synthesizing findings: The final step in desk research is to synthesize the findings from various sources, highlighting key insights and trends. This synthesis often takes the form of a literature review, where the researcher summarizes and evaluates existing research to provide a comprehensive understanding of the market landscape.
Significance of secondary research in market analysis
- Cost-effective insights: Sometimes desk research can offer valuable insights at a lower cost than primary research. Since the data has already been collected and analyzed, secondary research can save both time and money, enabling businesses to allocate resources more effectively.
- Broadening perspectives: Secondary research exposes researchers to a wide array of perspectives and methodologies, encouraging critical thinking and fostering a more comprehensive understanding of the market.
- Enhancing credibility: By incorporating secondary research into market analysis, researchers demonstrate their thoroughness and commitment to evidence-based decision-making. This approach can bolster the credibility of their findings and recommendations, making it more likely that stakeholders will embrace the results.
In conclusion, secondary research is an indispensable market analysis component, serving as the foundation for primary research initiatives. By identifying research gaps, informing research design, and contextualizing primary research findings, secondary research adds depth, rigor, and credibility to the market analysis process. Embracing the full potential of secondary research is essential for businesses seeking to make informed, data-driven decisions in an increasingly competitive global marketplace.
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