Market Research


DEFINITION of 'Market Research'

The process of assessing the viability of a new product or service through techniques such as surveys, product testing and focus groups. Market research allows a company to discover who their target market is and what these consumers think about a product or service before it becomes available to the public. Market research may be conducted by the company itself or by a third-party company that specializes in market research. Test subjects are usually compensated with product samples and/or paid a small stipend for their time.

BREAKING DOWN 'Market Research'

For example, a company that was considering going into business might conduct market research first to test the viability of its product or service idea. If the market research confirms that company's predictions, they can proceed confidently with their business plan. If not, they can use the results of the market research to make adjustments and do additional testing. Though market research can be expensive and time consuming, it should be less expensive and time consuming than fully developing and bringing to market a new product or service that will generate little or no interest from potential customers.

  1. Consumer Goods

    Products that are purchased for consumption by the average consumer. ...
  2. Life Cycle

    The course of events that brings a new product into existence ...
  3. Marketing

    The activities of a company associated with buying and selling ...
  4. Brand Awareness

    The likelihood that consumers recognize the existence and availability ...
  5. Economic Moat

    The competitive advantage that one company has over other companies ...
  6. Efficiency

    A level of performance that describes a process that uses the ...
Related Articles
  1. Professionals

    Career Advice: Stockbroker Vs. Insurance Agent

    Compare and contrast careers as a stockbroker and insurance agent. Understand the skills and attributes required for success in each career.
  2. Personal Finance

    Consumer Protection Laws You Need To Know

    Knowing these which consumer protection law can help you in particular situations can save you time, money and stress.
  3. Markets

    Consumer Spending As A Market Indicator

    What people buy and where they shop can provide valuable information about the economy.
  4. Stock Analysis

    Analyzing Porter's 5 Forces on Facebook

    Read about how you can use Porter's five forces to analyze Facebook's competition. This simple methodology looks at several different factors or forces.
  5. Personal Finance

    10 Tips for Conducting Effective Meetings

    Sometimes meetings are necessary, but they're often a waste of time. These ten tips can help you conduct effective, productive meetings.
  6. Personal Finance

    Overlooked Skills You Need to Succeed at Work

    To succeed at work, you need to master a variety of soft skills.
  7. Economics

    Explaining Efficiency

    Efficiency refers to the ability to make something with the fewest resources possible.
  8. Economics

    What is a Code of Ethics?

    A code of ethics is a collection of principles and guidelines an organization expects its employees to follow.
  9. Economics

    Explaining the Balanced Scorecard

    A balanced scorecard is a metric that measures a business’ performance.
  10. Professionals

    How Agile Principles Are Used in Holacracy

    Holacracy itself has been an actively utilized management system since 2007 with its framework rooted in agile methodology.
  1. How might a company use demographics to assess the size of a potential market?

    Demographics can be used to help a company determine key characteristics of the potential population to which it company ... Read Full Answer >>
  2. How can a business determine its most effective value proposition?

    To determine its most effective value proposition, a company must make a purposeful effort to craft a unique value proposition ... Read Full Answer >>
  3. What is the difference between business intelligence and competitive intelligence?

    Competitive intelligence is the act of understanding a company's industry and industry rivals so the company can make better ... Read Full Answer >>
  4. What's the difference between Porter's 5 forces and PEST analysis?

    The major difference between Porter's five forces and PEST analysis is that PEST analysis is designed more for the company ... Read Full Answer >>
  5. How do Internet companies profit if they give away their services for free?

    Companies that operate in Internet services have grown in number consistently in recent years as more consumers are utilizing ... Read Full Answer >>
  6. What's the difference between consumer confidence and consumer sentiment?

    There isn't a difference between consumer confidence and consumer sentiment. Both terms are used to refer to the degree ... Read Full Answer >>

You May Also Like

Hot Definitions
  1. Black Friday

    1. A day of stock market catastrophe. Originally, September 24, 1869, was deemed Black Friday. The crash was sparked by gold ...
  2. Turkey

    Slang for an investment that yields disappointing results or turns out worse than expected. Failed business deals, securities ...
  3. Barefoot Pilgrim

    A slang term for an unsophisticated investor who loses all of his or her wealth by trading equities in the stock market. ...
  4. Quick Ratio

    The quick ratio is an indicator of a company’s short-term liquidity. The quick ratio measures a company’s ability to meet ...
  5. Black Tuesday

    October 29, 1929, when the DJIA fell 12% - one of the largest one-day drops in stock market history. More than 16 million ...
  6. Black Monday

    October 19, 1987, when the Dow Jones Industrial Average (DJIA) lost almost 22% in a single day. That event marked the beginning ...
Trading Center