Internet market research

What is customer research?

Boiled down to the basics, customer research focuses on understanding your customers by focusing on exploring their attitudes, needs, motivations and behavior as it relates to your business.

This ultimately helps you better identify, understand, analyze and retain your customers. The more you understand your customer the better you’re able to market to them, create products and services that meet their needs, gain competitive intelligence, proactively identify shifts in purchasing intent and behavior, and increase your chances for success.

Well-crafted and actionable customer research can serve as a foundation for the voice of the customer (VoC) efforts within your organization. And it’s been proven to be a key to the performance of top companies today.

Primary vs. Secondary Customer Research
There are typically two types of customer market research: primary and secondary. They are complementary and can be used together to gain a more comprehensive understanding of your customer. Read on for more information on which one to use for your specific needs.

Primary Customer Research
Primary research is any type of research that you conduct directly with your target customers. Its biggest advantages are that you can target it to groups or segments of your customers and specifically tailor the content to your research needs. Primary customer research includes:

Online surveys. Increasingly popular and relatively low cost, online surveys are widely used by retailers to capture insights from existing and potential customers. They can be conducted using your own customer database, or you can use third-party consumer survey panels that include your customers. If you use a consumer research panel you will have to include a question to identify your shoppers.

Mail surveys. Once the gold standard, mail surveys have fallen out of favor for quicker, less expensive options. Printed surveys are mailed and sent back in a pre-paid envelope. Response rates (the proportion of people sending back a completed survey) are often very low and the turn-around time for mail surveys to be returned is long.

Telephone interviews. Although they provide faster feedback than mail surveys, the effectiveness will be limited by the available phone numbers, particularly since you can’t solicit to cell phone numbers without permission. In addition, potential customers are often wary of being called and may be reluctant to give anything other than short answers.

Face-to-face surveys (often store exit interviews). Personal interviews conducted face-to-face can be on the more expensive side, but they can also provide detailed insights from your customers. They require coordination with Store Operations, which might require more up-front time for planning.

Focus groups. Focus groups bring together a small group of consumers to discuss their opinions about products, brands, shopping and other relevant subjects. You might think of them as customer panel research. They're a good way to get a sense of customer preferences and attitudes. However, because a focus group involves only a small number of customers, it can be challenging to apply the results to your entire customer base.

Online bulletin boards. For this research tool, customers opt into a three-day “group conversation” led by a professional moderator who poses questions to participants and probes answers for more details. This is an effective tool to drill down into specific issues, but is based on a small sample.

Ethnographic. This type of research involves observing customers in their actual environment, which might be their home, a store or online. Watching how consumers behave provides many insights, but can leave questions unanswered.

Sales data. You can analyze your transactional data to glean insights on customers. It’s a form of customer behavior research, and it can be conducted in conjunction with other types of customer market research to give you a comprehensive analysis of your customers. Learn more about customer analytics and analysis.

Customer quizzes. Another increasingly-popular survey tactic is to place a short pop-up survey on your website. This can help confirm a hypothesis you have about your target market or help define a product issue. Remember to keep it short - pop-up surveys are most successful when you stick to one question.

Secondary Customer Research
Secondary research is data that has been compiled and organized by a third party, typically data aggregators or large customer market research companies who focus on specific industries and types of data. This includes “syndicated research,” which is research that is independently conducted, published and sold by a market research firm.

Secondary research typically measures consumer attitudes, product and brand preferences, media consumption habits, and demographic and lifestyle characteristics. It’s usually based on large research projects conducted on a national level. The results aren’t limited to your customers, although you can select demographics and other data to help you mirror your customers as much as possible.

Some examples of secondary customer research include industry trends by retail-specific market research companies, such as NPD; media consumption reports by data aggregators, such as Simmons; and shopping behavior tracking by retail specialists, such as Kantar.

Since the same research results can be purchased by several companies, the cost of performing secondary research can be less expensive. These reports are useful for tracking consumer trends and providing comparisons. However, they don't provide the same level of actionable insights on your customers as primary research, which is designed to find the “why” of a purchase and to project what could occur in the future.

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