What is market research?

What is market research?

Market research is the process of evaluating a possible opportunity for entering into a market with a new product or company, or for evaluating the effectiveness of a product or company in a market that they are already invested in. Market research can also be important for decisions regarding mergers and acquisitions. It may involve surveys and market study groups.

Sometimes a company will conduct its own market research, but often third-party companies are hired for the task. These companies may specialize in sampling and surveying methods for consumer groups, and/or statistical analysis of a business model or product’s chance of success in a given market. Companies may look to such analysts if they are considering a merger or acquisition, or of launching a new product.

Companies may also be compelled to engage in market research if their performance has been slipping relative to their standards or that of a peer group. Individuals who participate in studies to gather this information are usually compensated in some way for their time.

Market research is a term that can sometimes be used synonymously with marketing research. Companies often have to do market research to identify or find out more about their target market.

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