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How do companies conduct qualitative market research?

March, 2022

Market research allows business decision makers to account for consumer, market insights and data to make informed business strategy. Qualitative and quantitative research form the two essential pillars of a robust market research effort. Quantitative research refers to the analysis of structured data collected through surveys, polling methods and experiments to draw objective conclusions. So, if the purpose of the study is to answer questions such as
“How many people from my target audience would respond to a new service?”, or “How many people could become potential customers?”, then insights gathered from a representative population would answer such business questions. Quantitative research also relies on the effective organisation, analysis and communication of the insights to the executive business leaders. On the other hand, qualitative research is motivated by the need to dig deeper into the ‘why’ of the objective insights, such as “Why do people like this particular new service?”. Qualitative research facilitates subjective conclusions from focus groups, observations and interviews. The purpose of qualitative research is to deliver insights drawn from closely observing potential or existing customers and uncover their motivations for particular decisions and actions.

Smart tip from TSB: A holistic mix of the “what” from quantitative research and the “why” from qualitative analysis delivers actionable business insights.

Use cases for qualitative market research
Now that we have looked at what qualitative research is, we will dig deeper into when to consider this tool as part of the market research process. Qualitative market research is useful if;

  • The purpose of the research is to explore open ended learning and there is a requirement for detailed explanations of observed facts or decisions.

  • The researcher wishes to explore the conscious and unconscious perceptions that drive consumer decisions and opinions.

  • The goal is to explore the nuances of brand/ platform/ product experiences and feedback of individual consumers

What's your rationale for such research?
While these are the broad objectives that the concerned organisation needs to evaluate to conduct qualitative market research, the study has wide applications across different organisational strategic objectives.

  • Product Development: Any company delivering a product or service to the consumer needs to understand whether its product is the right fit, what are the consumers liking and disliking to ultimately, dynamically address consumer needs. Qualitative market research provides this essential intelligence that helps firms to improve their product development strategy.
  • Marketing strategies: It is essential to understand how the consumers respond to the marketing mix of product, packaging, price, promotions, place and positioning. To be build the most efficient, effective and representative marketing strategies, consumers’ opinions and reactions need to be understood. They can be mapped at every touchpoint through qualitative market research.
  • Brand Image: To sustain in this highly competitive and evolving market, it is important for brands to understand how they are perceived by their customers. It allows the brand to maintain, enhance and continuously revise its reputation.
  • Segmentation: In this age of increased need for personalisation and customisation, understanding different buyer personas to tailor and target marketing strategies becomes imperative. Qualitative market research can facilitate insights that can help the company build buyer personas and comprehensive segments.
  • New Business Opportunities: Every business looking to grow needs to see its positioning in the current market from the per of its consumers. Through focus groups and on-ground research, businesses can evaluate the changing business dynamics and stay informed on consumer needs. These interactions with consumers can lead to identification of untapped business opportunities that could be tapped.

Techniques to conduct qualitative research Qualitative research can be conducted through the following methods;

  1. Focus groups: Focus groups comprise industry experts that together help discuss a particular product and the market strategies. It can consist of 5 to 10 people and is led by a moderator who is responsible for stimulating the discussion. A recent phenomenon is the utilisation of online communities to derive similar insights.
  2. One-on-one interviews: This method relies on open-ended conversations to get comprehensive insights from the respondent. The research can be conducted either face-to-face or through telephonic interviews.
  3. Observational research: Such research methods rely on observations for afar to gather insights on consumer reactions to products and purchase experience. It allows the researcher to gather insights real time.

It is important to understand research objectives before deciding on conducting market research. Each research study should begin with a desired conclusion in mind so that resources spent preparing and conducting the study are not squandered, and it aids in business agility. Hence, once the motivation for conducting qualitative market research is uncovered, the next steps would be;

  • Method: As shown above, qualitative market research can be conducted in several ways. The decision on the type of method to employ depends on the target study, research objectives, demographics, geographical area, the product/ service being surveyed, etc.
  • Personnel: The team responsible for conducting and collecting data should be experienced in tracking responses from the respondents in a way such that biases are minimised.
  • Sampling: The main basis of the market research is the sample from which the insights are drawn. This sample can be created based on the purpose such that users that fit the demographic requirements are selected, sample could be selected from a quota that is representative of the larger population or users that match certain criteria are asked to recruit similar people.
  • Design: The design of the survey influences the efficiency of the whole exercise. Questionnaires, scripts that derive the maximum value would assist in building a robust and actionable output.
  • Data collection: Data would need to be collected such that it is coded in universally understood or pre-conceived buckets as well recorded properly. Since, data forms the foundation of the analysis to be carried on henceforth, its proper treatment is essential.
  • Data analysis and reporting: Data once collected would need to be analysed such that the desired objectives of the qualitative market research are achieved. Extracting business insights for relevant departments is the ultimate desired output of the market research study. It should be easy to utilize for all the relevant stakeholders.

Overall, qualitative market research provides insights that look past surface-level metrics, are more flexible to the researcher’s needs, can be great idea generators and ensure enhanced customer retention if implemented successfully. Nonetheless, qualitative market research can be costly and time consuming. The accuracy of the insights can be challenged due to its reliance on only a small sample of the population. Additionally, there could be various sources of bias among the participants or researchers that influences the quality of the responses.

Now let us look at a real-life case study. A leading European FMCG brand needed to understand the perception of energy drinks among the adult population. The company wanted to understand the market for its proposed new product in the UK, Scotland and Ireland. The Strategy Boutique (TSB) came on board to evaluate this market. TSB is a management consulting firm with extensive experience and expertise in the field of market research. The company has assisted brands and organisations across different industries, fashion, cosmetics, food and beverage, pharmaceutical, automobile, real estate, among others to derive actionable market insights. The team conducted qualitative and quantitative research methods to further understand the market for energy drinks in the region. As part of the qualitative market research efforts, local associates collected data about the preferences of consumers in the age group of 16-45 year olds. The objective was to understand the need and motivation for buying energy drinks, preferred flavours, packaging, size, as well as sales channels. Furthermore, consumers were questioned about their current pain points and brand affiliations. The research findings informed the leading brand’s sales and distribution strategy, marketing plan and promotional strategy. Key insights from the market research also influenced the product development efforts.

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  • Mahima Kumar

Mahima is an associate consultant at TSB since 2021. You can find her in the socially constructed reality during the day and her self-constructed reality all year long.