Market research is one of the most crucial things a company can invest in as part of their digital marketing, sales, or overall business strategy.
Various types of market research methodologies help an organization understand:
- Customer satisfaction
- Pricing models
- Consumers habits
- Market trends
- Product or project feasibility
- Employee engagement
Overall, quantitative and qualitative 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 common ways a company can utilize market research:
- In-house market research
- 2. Outsourced market research
In this blog post, our market research company will discuss what approach is best to meet your organization’s specific business objectives and goals.
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 and internal resources.
This means an organization has a person or team, usually within the marketing department, dedicated to doing research on behalf of the company.
This is most common in larger corporations that have the budget to support an entire team of market research professionals. However, in other instances, some organizations may ask their marketing teams to execute a study for the perceived cost savings.
💡 The Key Takeaway: In-house market research is just as it sounds–a company takes on its research projects without the help of an internal team.
What is outsourced market research?
A dedicated in-house market research team 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 a business will reach out to a market research company, like Drive Research, to conduct studies on their behalf.
Professional market researchers often 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:
- Online surveys
- Focus groups
- Customer satisfaction studies
- Feasibility studies
- In-home usage tests
- PR surveys
- Employee surveys
💡 The Key Takeaway: For brands that depend on market research (hint: we think that should be every brand), they should consider partnering with a credible third party team.
Benefits of in-house market research
1. Perceived Cost Savings
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 a third-party.
It is important to keep in mind, however, in-house teams are often less efficient than an outside market research company. This means, that the total cost savings may not be as significant in the end.
2. Knowledge of Products and Services
Another benefit of an in-house market research team or staff member is the depth of knowledge they have of their organization’s products and services.
He or she is able to provide a great sense of insight into 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 a lack of integrity in the study altogether.
If you are unable to hire a dedicated market researcher or are wary of market research bias, look for a market research company that specializes in your industry, such as:
- Advertising and marketing
- Architecture, engineering, and construction
- Banks and credit unions
- Consumer packaged goods (CPG)
- Higher education
- Hotel & hospitality
- Small business
- Travel & tourism
In doing so, your organization receives a dedicated market research team fully capable of understanding both industry and market research best practices.
It’s the best of both worlds!
Our market research company recommends watching this 60-second video if you are considering conducting research internally.
Benefits of outsourced market research
1. Experience and Know-How
As mentioned earlier, a market research company devotes all efforts to learning and excelling in market research.
They have the expertise and a knowledge base that can only come with years of experience.
2. Strategically Written Survey or Interview Questions
A market research firm knows the 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.
Survey design is truly part art and part science.
One word in a question can skew the data significantly. Understanding how to write a survey or interview guide based on unique business goals and objectives is critical to the success of any market research study.
This insight is one that only true market research professionals hold and should not be overlooked.
3. More Credible Research
Lastly, working with a research company makes the data and feedback collected more credible. This is because of the low risk of bias, use of market research best practices, and years of experience.
Ultimately, this makes participants feel the study is legitimate and encourages them to take the research process more seriously.
💡 The Key Takeaway: While there are many benefits to an outsourced research team, some of the top benefits include: credibility, strategic survey questions, and years of experience in the field.
Recommended Reading: Should I Outsource My Market Research?
Outsourced market research example
One of the greatest benefits of 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.
In other words, negative feedback is not easily relayed directly to a company with which someone has a long-standing relationship.
An outside party or middleman, like a third-party market research company, is needed to get the most accurate feedback.
Here is an example.
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.
💡 The Key Takeaway: The above examples shows just how important an outsourced research team is to a project. By using these teams, clients can avoid unintentional bias in the feedback.
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 to 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.
Outsourcing larger studies also give your staff more time to focus on other aspects of their jobs.
Our market research firm can be as hands-on or off as you need us to be. While Drive Research offers end-to-end project management services, we understand that it is not necessary for every organization.
💡 The Key Takeaway: When asking, “what is the difference between in-house and outsourced market research?” it’s important to look into each method to understand the pros and cons of each. This is a critical decision when it comes to how your project will unfold.
Choosing an Outsourced Market Research Company
If you want to work with an outsourced team, that’s a great decision. But what makes it a great decision is choosing the right team.
As you read in our previous section, there are many benefits to working with an outside team for your project. However, they need to be able to conduct all aforementioned duties well, all while keeping your needs as a client in mind.
Here’s a shortlist of some basic factors to look out for:
- The team understands multiple industries
- They can create a customized project plan
- They’re trustworthy (this is a big one!)
- The project managers prioritize client success
You’re going to want to look out for companies that are well-versed in a number of different research methods among varying industries.
When searching for a team, do some of your own research–who are their clients? Have they done projects for companies in different fields? Do you only see one or two industries they’ve done work in? Ask yourself questions like this to ensure you’re choosing a team with experience.
Now, we’re going to balance out our previous statement.
Yes, you want a versatile team with experience in varied fields. But you also need to know they’re not so broad they can’t offer project customization. Good market research requires customization, and you need to make sure your team can do that.
Having a good relationship with a third party’s project management team is something to prioritize. This team may only be one person, or a few (project management teams tend to be small–over 30% consist of 5 people or less).
Think of them as one of your main points of contact throughout the project. You’ll want to make sure that you can openly discuss key objectives and concerns you may have.
Ensuring your third-party team has a history of being trustworthy is not a factor to overlook. Keep an eye out to see how committed they are to client projects (and relationships!), how transparent they are, and how often they keep in touch with clients throughout the project.
💡 The Key Takeaway: Each factor discussed in the above segment is of equal importance when considering market research outsourcing. Take your time when choosing a third-party team.
Drive Research is a national market research company located in New York. 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.
- Message us on our website
- Email us at [email protected]
- Call us at 888-725-DATA
- Text us at 315-303-2040