Market research is one of the most crucial things a company can invest in as part of their marketing strategy. Various types of market research methodologies help an organization understand competition, consumers habits, market trends, and more.
Market research strategies help companies investigate and answer questions that influence their strategy and decision-making processes. Even better, it often results in an increased return on investment (ROI).
There are two ways a company can utilize market research:
1. In-house market research
2. Outsourced market research.
In this blog post we’ll discuss what type of research method is best to meet your organization’s specific business objectives.
Understand the difference of conducting market research in-house or outsourcing to achieve the ideal results specific to your business objectives.
What is In-house market research?
It may sound self-explanatory, but in-house market research is when a company conducts a study within its own business structure.
This generally means the market research company has a person or team, usually within the marketing department, dedicated to doing research on behalf of the company.
What is outsourced market research?
A dedicated in-house market research is not the case for a majority of companies. Instead, most organizations prefer to outsource their data collection projects to a full-service market research company.
This means the company will reach out to a market research company, like Drive Research, to conduct studies done on their behalf. Professional market researchers have the skills and experience to do a more thorough job than a small in-house team or one single person.
Market research companies have the capability to conduct a wide variety of studies, such as:
Learn more about the different types of custom market research services.
Benefits of in-house market research
Perhaps the biggest benefit to conducting market research through an in-house team is the perceived cost savings. When a company conducts in-house market research, it does not have to hire an outside company. It is important to keep in mind, however, an in-house team will be less efficient than a market research company. Meaning, the total cost savings may not be as significant in the end.
Another benefit of an in-house market research team is the depth of knowledge your team has of an organization’s products and services. They are able to provide a great sense and insight to the research, otherwise picked up by an outsourced company.
Every company has its own specialized processes, terminology, and systems. This means an in-house team may be able to best represent needs and goals while conducting market research.
The danger here is the lack of experience and knowledge of market research best practices which could lead to bias, unreliable results, or lack of integrity in the study all together. If you are unable to hire a dedicated market researcher or are weary of market research bias, look for a market research company who specializes in your industry.
In doing so, your organization receives a dedicated market research team fully capable of understanding both industry and market research best practices.
Bias. The word sends shivers down a market research professional's spine! Learn about 5 types of bias in market research.
Benefits of outsourced market research
As mentioned earlier, a market research company devotes all efforts to learning and excelling in market research. They have expertise and a knowledge base that can only come with years of experience.
A market research company knows best questions to ask and practices to use. These teams can better interpret data since they have other studies to reference and can provide context an in-house market research team cannot.
Lastly, working with a market research company makes the research process more credible. There is a low risk of bias, use of market research best practices, and tons of experience. Ultimately, this makes participants feel the study is legitimate and encourages them to take the research process more seriously.
Read more about why outsourcing market research is a good idea.
Outsourced market research example
One of the greatest benefits to outsourcing market research is that most participants will be more honest and accurate with their feedback because it is not directly communicated with the company.
While participants are not trying to be dishonest, unintentional bias can be found when there is a strong business-customer relationship. Negative feedback is not easily relayed directly to a company of which someone has a long-standing relationship. An outside party or middleman, like a market research company, is needed to get the most accurate feedback.
For example, an advertising and marketing agency partnered with a market research company to conduct phone interviews with long-time clients of the agency. The objective of the study was to determine:
- Overall client satisfaction or dissatisfaction
- What clients liked and disliked about working with the agency
- If clients would provide a customer testimonial for the agency’s website
By hiring a third-party market research company, clients of the marketing agency were comfortable offering suggestions and areas of improvement knowing their name would not be associated with their commentary.
In doing so, the marketing and advertising agency received more accurate data and feedback to better service past, present, and future clients.
Combining in-house and outsourced market research efforts
Can’t decide between using an in-house market research team or outsourcing to market research professionals? Why not get the best of both worlds?
Sometimes, the best choice for a company is not to rely solely on one method or the other, but to utilize a combination of both. Many companies have an in-house team do more day-to-day data research but also choose to outsource more complex projects to make sure daily business objectives are not negatively impacted.
Still not sure which method is best for your company? Take this quiz generated by the team at Drive Research to help!
Drive Research is a market research company located in Syracuse, NY. Our team has the knowledge and tools to design a robust market research study, should it be the right fit for your business.
Interested in learning more about our market research services? Reach out through any of the four ways below.