Market Research Guide: How To Conduct Market Research

Effective market research consists of systematically gathering data about people or companies with common characteristics—known as a market—and then analyzing it to better understand what that group needs. Business owners and marketers use the results of market research to make decisions about the company’s strategies, operations, and potential customer base.

While market research has historically been a laborious task requiring a sizable investment, new technology is lowering the barrier to this practice. As of late 2025, 95% of researchers reported using AI tools for research tasks. 

In this article, you’ll learn the top market research methods, discover how researchers are leveraging new technologies now, and gain expert insights from Fiona Parfrey, cofounder of period care company Riley.

What is market research?

Market research is the process of gathering and analyzing information about consumers and companies in a particular market or market segment. Businesses use this type of research to better understand the opportunities in the market. Common questions businesses seek to answer with market research include: 

• What is the total size of the market? 
• How saturated or competitive is the market?
• What are the demographics of the consumers in this market? What about their behaviors?
• What problems can you help consumers solve? What do they want in a solution?
• What factors will the consumers consider when selecting a solution? 
• Who are your competitors? What do they offer, and at what price point? How are they positioned in the market?

Types of market research data

Market research initiatives employ diverse methodologies, which are classified by source type (primary or secondary) and information format (qualitative or quantitative). 

Primary vs. secondary data

Your approach to market research first depends on the type of source material you are seeking—primary or secondary. 

Primary research relies on information you gather directly from consumers. You (or a research firm you hire) can collect it via surveys, interviews, or focus groups, or by mining online reviews. Primary research can be time-consuming and costly, but the advantage is that you own the data, and you can design the research to uncover nuances that are too niche to show up in secondary literature. 

Secondary research draws on information that others have collected. Popular secondary sources include magazines, newspapers, and government and industry market research reports. This data is easily accessible and may even be available for free. But it may lack the level of nuance or detail needed to make critical business decisions.

Quantitative vs. qualitative data

Market research data can be quantitative (numerical) or qualitative (non-numerical).

Quantitative research produces numerical data, resulting in an absolute figure or a percentage. To obtain quantitative data, researchers measure consumer behavior, request numerical responses, or have participants choose from predefined option sets, as in multiple-choice, Likert scale, dichotomous, or ranked-choice models. It is relatively simple to analyze and synthesize. 

Qualitative research produces non-numerical data. Examples include a recording of a focus group, a Reddit thread about a competitor, or an open-ended survey answer. Unlike quantitative research, it allows customers to suggest, request, or share things outside of the limits of an answer set. 

You can use qualitative data to contextualize quantitative findings. If an apparel brand learns that customers attribute the majority of returns to fabric or color, for example, the company might hold a focus group to learn more about how consumers perceive these design elements.

You can also extract quantitative insights from qualitative data by defining a category and counting how many times it appears in a dataset. This same apparel company might list all color descriptors that appear in the focus group’s transcript, group them thematically, and count the total number of mentions per group. 

Why is market research important?

• Accelerates growth
• Increases retention
• Generates marketing intelligence

Market research helps businesses learn about their consumers, and it’s a necessity at every stage of business growth. Here are a few key benefits:

Accelerates growth

Market research can help you grow your business by uncovering new opportunities to meet consumer needs. A 2025 Hanover Research study found that businesses that conduct market research are 33% more likely to enter new markets than those that don’t, and they’re 23% more likely to launch a new product or service. The same study also found that businesses that conduct market research are more likely to boost revenue, cut costs, and attract new customers than those that don’t.

Increases retention

Market research gives you a window into the attitudes and preferences that drive your customers’ purchase decisions. You can use these insights to guide the specifics of your product offering—in order to ultimately increase sales and customer retention.

Organic period care company Riley, for example, used post-purchase and subscription cancellation surveys to understand how customers perceived their delivery options. 

“You get your period usually once a month, so we thought that monthly deliveries made a lot of sense,” says cofounder Fiona Parfrey. “But we learned from the feedback we got when customers changed or canceled their subscriptions that the fewer deliveries, the better,” says Fiona. “Customers don’t want to be overstocked in the product. When they have a delivery every month, it feels like they’re spending more than they realize.”

Riley changed their subscription offerings based on this information. “Now we only have deliveries every three months, or every six months, and we get customers to put enough product in that delivery that it will last them,” Fiona says. “That’s just a really interesting psychological thing that we learned about the customer mindset,” she says. “It increased our retention rate quite significantly.”

Generates marketing intelligence

Market research clarifies consumer priorities, providing a nuanced understanding of target audiences you can use to write resonant marketing messaging or optimize your campaign creative.

Riley used market research to explore what its customers care most about so they could tailor their brand messaging accordingly. The results disproved one of their prevailing assumptions. 

“One thing really surprised me was that the health messaging was actually far more important for people than the sustainability element,” says Fiona. She credits COVID-19, which coincided with the company’s launch. “What we saw happening was a shift in our customer mindset. The health benefit was a little bit more personal and emotive to them.”

As a result, the brand opted for hero copy at the top of its website that emphasizes the products’ health benefits.

Market research methods

• Surveys
• Social listening
• Interviews
• Focus groups
• Observation
• Synthetic data generation
• Secondary research
• Competitive analysis

Anything that improves your understanding of the consumers and businesses in your target market can be part of your market research strategy. Here are eight popular market research tactics:

Surveys

A survey is a set of questions distributed to individuals along with a request for a response. Businesses can conduct surveys by phone, in person, on paper, or online. 

SurveyMonkey and Qualtrics are purpose-built survey tools, though there are other ways to collect responses. Riley distributes ad-hoc customer surveys using Google Forms, automates post-purchase surveys and subscription status change surveys with Skio, and runs quick, informal polls on social media as a way of taking an audience’s temperature. 

Social listening

Social listening is the process of monitoring social media platforms for content relevant to your business. You might monitor comments about your brand, comments about your competitors, and general chatter about subjects applicable to a research question. 

You can automate this process using social listening tools. Many are equipped with AI, allowing them to automatically flag relevant content and extract quantitative insights through thematic and sentiment analysis. You might use a thematic tool to explore the most common complaints about competitor products, for example, or sentiment analysis for insight into general consumer opinion of a brand.

Interviews

Market research interviews are one-on-one conversations in which a researcher poses questions designed to probe the subject’s thoughts, opinions, challenges, and product preferences. 

AI tools can help you accelerate the process of getting insights from interviews, as they can automatically transcribe and summarize interviews, extract key insights, and identify trends. As a result, interviews are becoming a more popular tactic. The same Hanover Research survey found that 79% of businesses conducted market research surveys in 2024, nearly double the 2021 figure. 

Interviews are Riley’s qualitative research method of choice. “If we want to ask open-ended questions, we prefer to speak to people directly,” Fiona says. “We pick up the phone or meet them face to face so that we can make sure we’re understanding their answers correctly.” 

Riley views this approach as a differentiator in an increasingly digital world. “We want to be out there on the ground meeting people who are customers or potential customers and stay close to them by actually having real conversations,” Fiona says.

Focus groups

A focus group is a group of people with a common characteristic—such as age, hobby, or buying habit—assembled by a researcher to gather data relevant to particular research questions. 

Focus groups typically consist of eight to 12 people as well as a facilitator or moderator who poses discussion questions and keeps the conversation on track. Businesses often rely on them to gather consumer feedback on products and product features, branding, and advertising or marketing campaigns. 

Observation

Observation is a research technique that involves watching a subject interact with a product, interface, or other business asset. It generates objective information, which business owners can combine with self-reported (e.g., survey or interview) data to create a more complete picture of conscious and subconscious factors relevant to an area of study. 

Observation might reveal a strong preference for brightly colored technical outerwear, for example, even if survey data suggests that color has minimal impact on purchase decisions. 

Synthetic data generation

Synthetic data is generated by an AI model trained on data from the real world, and it’s an emerging source of consumer intelligence. There are two mechanisms through which businesses produce synthetic market data: synthetic consumers and synthetic populations.

Synthetic consumers are AI personas that reflect the consumers in a particular market. Researchers create them using a generative AI tool powered by a deep learning model, such as a large language model (LLM). The tool uses demographic and behavioral data gathered from a real-world market to create AI personas representative of the market’s consumers. Businesses can then generate synthetic market data by applying other research methods (such as surveys, interviews, and focus groups) to the persona group. 

A synthetic population is a modeled representation of an actual population. Synthetic populations are created by human researchers, who use real-world data and statistical modeling to generate a digital twin for a target group. Market researchers can use this digital twin to run scenarios that produce population-level outputs. 

There are benefits to each approach: Synthetic respondents are relatively easy to develop, but output quality varies, and data validation is labor-intensive. Synthetic populations front-load the investment, requiring high-quality data from multiple sources and inputs from predictive modeling experts, but good models provide flexible sources of high-quality data. 

Business owners can partner with market research firms with synthetic data experience, like Statista and Kantar, to explore the benefits of synthetic data. 

Secondary research 

Secondary market research gathers data from existing sources. Many researchers rely on it for initial research or high-level industry or market overviews. Popular sources include:

• Industry associations and trade groups
• Trade journals specific to your industry
• Government reports, such as the census or annual federal procurement results
• Industry analysts
• Market research groups

Riley relied on a state-funded initiative offering startups access to secondary data and reports. “That was really useful for us at the beginning,” says Fiona, adding that secondary research helped her team identify preliminary marketing messages and provided statistics for investment proposals and other key early-stage assets. 

Competitive analysis

Competitive analysis is a market research tactic that looks at the strengths and weaknesses of competitors in your market. It involves gathering and analyzing data on competitors’ products, pricing, marketing strategies, distribution channels, and customer base.

Riley analyzed competitor reviews to identify weaknesses in comparable business models. “We looked at what our competitors were doing and how the community was interacting with them,” says Fiona, “What was really key was what they might not be doing so well.” 

The team used this strategy to identify and explore unmet customer needs. “We asked, ‘What are the gaps here?’” Fiona says. “Is it a service issue? A price point issue? If people are unhappy with something, what is it, and can we solve that problem for them?”

One key insight they found was related to quick fulfillment. “People really don’t like it if a business takes four or five days to just fulfill the order,” says Fiona. As a result, Riley committed to same-day shipping for orders placed before 1 p.m., with most orders reaching customers the following day. 

How to conduct market research

1. Set a goal
2. Develop your research question
3. Determine your research methods
4. Collect the data
5. Analyze the data
6. Identify next steps
7. Plan for ongoing research

The specifics of your market research process will reflect your industry, goals, available resources, and working preferences. But all market research endeavors follow the same basic blueprint: 

1. Set a goal

Market research can support any number of business goals, so start by defining the purpose of your initiative. Here are a few examples:

• Getting to know a new audience
• Developing a new product
• Improving your competitive position
• Creating a brand identity
• Optimizing your customer experience
• Vetting a market for entry

Riley’s initial market research initiative was aimed at getting product to market quickly. The founders had identified a market gap, and they wanted to act on it—fast.

“The idea for our business came about from our own personal frustrations with the period care market,” says Fiona. “We knew that there was a gap, and there was a need to fix it. So we looked at what was on the market at the time.”

Riley opted for a compressed process with multiple research initiatives in motion at once, including target customer interviews and surveys, social listening, and competitor research. 

2. Develop your research questions

Next, identify the questions your research will answer, such as:

• Are customers aware of the problem we want to solve, or do they need to be educated about the problem? 
• How do the consumers in my market find and vet products? 
• Who are our top competitors in this market? How does their pricing, feature set, and positioning compare to ours? 
• Does our product work as intended? How do customers actually use my product? What use-related difficulties do consumers face?

You don’t have to tackle these questions sequentially. Riley, for example, aimed to answer several of these questions at once. You can use working hypotheses to speed up research cycles or put one initiative in progress before you’ve concluded another.

3. Determine your research methods

Once you have a goal and a question set, identify the data you need and decide how to capture it. You might combine qualitative research (like interviews and focus groups) with quantitative data (like surveys) to put together a comprehensive and detailed picture of your market. You’ll also decide between conducting research in-house or outsourcing it to a third party to help speed things along.

The Riley team started with a mix of methods: 

• Target customer interviews and surveys. The team surveyed women who had signed up for their email list to understand if they were aware of the harmful chemicals in common period care products. 
• Social listening. The team also reviewed Instagram comments, Threads, and Reddit.
• Competitor research. The Riley team reviewed competitor websites and marketing materials (like paid ads and emails) to understand their product positioning and pricing strategies and to identify opportunities for differentiation. They also mined competitor product reviews on third-party sites like Amazon and TrustPilot.

4. Collect the data

Once you’ve chosen your research methods, prepare for data collection. Depending on your methods, you might need to prepare questionnaires, set up focus groups, design surveys, or gather secondary source material. Then deploy your chosen method and collect that data. 

In order to deploy a survey, the Riley team had to build an email list. To do that, they used organic and paid social media to reach women interested in organic period care options, directing them to a landing page where they could sign up with their email address to receive more information. 

The company planned to send a five-minute survey to the first 100 people who signed up, but they quickly accumulated more email addresses than that. “In the end, we had over 650,” Fiona says. “It was bigger than we had anticipated—which was great, just to get as much data as possible prior to launching.”

5. Analyze the data

Next, turn raw data into insights by identifying any patterns or trends that answer your objectives. 

Fiona describes analyzing survey data as a turning point in Riley’s initial research. “When that first survey came back, the statistics were quite staggering,” she says. “So many women didn’t even know that the products they were using were harmful.” 

6. Identify next steps

Once you’ve analyzed the data, determine what to do next. Prepare a report that includes key insights, data, and recommendations based on your findings. Answer the question: What can you conclude about your market, audience, or product? And what actions do you want to take as a result? 

For Riley, the next step was taking their product to market with health-focused positioning informed by their market research. 

7. Plan for ongoing research

Market research isn’t one-and-done—it’s something to continuously use in your business. 

Riley developed an ongoing market research strategy that includes sharing information via Slack. “We have a market research Slack channel that everything goes into, and the entire team is in it because it’s relevant to every single person in this business,” Fiona says. “It’s looking at our direct competitors, it’s looking at other industries that might be doing some really cool things, it’s customer feedback that we get—everything goes into that one Slack channel.”