What is Secondary Market Research?

Secondary market research involves utilizing preexisting data and insights gathered from various sources in the past.

Unlike primary research, which gathers new and original data through surveys or experiments, secondary research relies on already available information.

The data used in this type of research can include reports, studies, and statistics from government agencies, industry associations, and academic institutions.

It’s a cost-effective and time-efficient way for businesses to get valuable background information, trends, and benchmarks, helping them make strategic decisions and complementing their primary research efforts.

But why is it so important, exactly? Let’s take a look and find out.

The Importance of Secondary Market Research

How primary and secondary research differ from each other. Source.

As mentioned, secondary market research (also known as desk research) involves gathering existing data sources and analyzing it for various purposes.

So, if, for instance, a cybersecurity company wants to launch a new product, data about the impact and frequency of Facebook identity theft should be a good foundation for trustworthiness and market knowledge.

It contrasts with primary market research, where data is collected firsthand through surveys, interviews, or experiments specifically designed for a particular research question.

Instead, secondary research leverages pre-existing information, making it a more cost-effective and time-efficient method than primary research. For instance, primary methods such as market surveys can range from $15,000 to $50,000, while focus groups can cost between $4,000 and $6,000 per session.

You can classify the data used in secondary market research into two main categories: internal and external.

• Internal data comes from within an organization and includes sales records, customer databases, financial reports, and previous market research studies conducted by the company. This data type is readily accessible and specific to the organization, making it highly relevant for internal analysis.
• External data is obtained from sources outside the organization, such as government reports, industry publications, academic papers, and data from trade associations.

Using internal and external secondary data can help provide a more complete market overview.

For instance, a company might use government reports to understand broader economic conditions, industry publications to gauge market trends, and internal sales data to analyze its performance.

Companies that actively manage their market research efforts tend to do better than those that don’t.

A recent study revealed that industry-leading companies attract up to eight times more visitors than their fast-following counterparts. Thus, it’s no wonder that global market search revenue has skyrocketed by a whopping 359% since 2009.

The Benefits of Secondary Market Research

Secondary market research offers several significant benefits, making it a valuable tool for businesses looking to gain insights without the hefty investment associated with primary research.

Less Financial Impact Compared to Primary Market Research

One of the most prominent advantages of secondary market research is that it’s very cost-effective. Since secondary research utilizes existing data, companies can avoid the high costs of designing, distributing, and analyzing surveys or conducting focus groups.

Likewise, secondary market research can also help when starting a business, as it gives entrepreneurs more information on the target audience.

It is particularly beneficial for small businesses or startups with limited budgets. By leveraging existing resources, businesses can access valuable insights at a fraction of the cost associated with primary research.

Takes Less Time to Execute

Time efficiency is another major benefit since collecting primary data can be lengthy, often taking weeks or even months to gather responses and analyze results.

In contrast, secondary data is typically readily accessible and can be easily gathered and analyzed.

It allows businesses to make informed decisions faster, which is essential in dynamic markets where timely action can be a competitive advantage.

More Accessible Data

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Access to extensive data is another significant benefit of secondary market research. Secondary sources often provide a wealth of information that would be difficult, if possible, to collect through primary methods alone.

For example, government reports, industry publications, academic studies, and databases offer comprehensive analytical data covering many different aspects of the market. Their extensive data pool can help businesses understand broader market conditions, consumer behavior patterns, and even emerging industry trends.

Secondary market research also helps businesses benchmark and analyze trends far more effectively. Through a thorough data analysis compiled from diverse sources, companies can discern emerging trends and objectively evaluate their performance relative to current industry benchmarks.

For example, industry reports can provide valuable insights into changing consumer preferences and the emergence of new market segments.

Challenges of Secondary Market Research

While secondary market research offers numerous benefits, it also comes with certain limitations and challenges that businesses must consider.

• A prominent challenge in secondary research is the potential for having outdated or irrelevant data. This arises because secondary research relies on information gathered from other sources, and the timeliness and relevance of this data may vary.
• Another limitation is the lack of specificity to the company’s unique needs. Secondary data is often collected for broad purposes and may not address the specific questions or issues a company is facing, especially when it comes to niche market segments.
• Possible biases in the data sources present another challenge. Data collected and published by various organizations can reflect the biases of those organizations, whether intentional or unintentional. For example, industry reports produced by market leaders might emphasize data that portrays their products or services more favorably—similarly, government data might be influenced by political agendas.

In fact, an ideal example of a scenario where secondary research might fall short is when launching a new product in an emerging market.

For instance, a technology company may want to introduce a new wearable device targeting senior citizens in a developing country. In this scenario, secondary data might be scarce, outdated, or not fully relevant, as existing reports might not cover this demographic or market conditions.

Because of this, you would need to engage in primary research to gather up-to-date, targeted information about consumer preferences, local market dynamics, and potential barriers to entry.

How to Carry Out Secondary Market Research

The basic steps of conducting secondary market research. Source.

Effective market research involves the right secondary research methods, from setting clear objectives to using the right tools and resources to help you.

Here’s a comprehensive guide that will walk you through the process step-by-step to help you conduct secondary market research.

Identifying Your Main Research Objectives

To perform secondary market research, the first step is to define your research objectives as clearly as possible. Understanding what you want to achieve helps focus your efforts and ensures that the information you gather is relevant.

Your objectives might include understanding market trends, analyzing competitor strategies, assessing customer needs, or identifying new market opportunities. Clear objectives can serve as a roadmap or blueprint that guides you in selecting the right sources and data for your research.

Finding and Evaluating Credible Sources

Once your objectives are set, the next step is to find credible secondary data sources to use in your efforts. Begin by identifying potential sources such as reports from government agencies, industry-specific materials, academic papers, and research databases.

It’s important for you to carefully evaluate the credibility of these sources by considering the publisher’s reputation, the date of publication, and the methodology used to collect the data.

Using credible sources provides reliable information, which helps guarantee your research findings’ overall accuracy and validity.

Organizing The Data and Analyzing It

Once the data has been gathered, you need to know how you’ll annotate it in advance; otherwise, you’ll have trouble utilizing it later. Once you’ve annotated your data, you want to categorize it based on themes or topics relevant to your research objectives.

You should use spreadsheets or databases to annotate and track your data, which will make it easier to identify patterns and trends as they emerge.

Combining Secondary Research and Primary Research (As Needed)

Consider combining secondary and primary research to get the most value out of your research. While secondary research offers a comprehensive market overview, primary research is a valuable complement that bridges the gaps by providing granular and customized insights.

For example, you might use secondary data to identify general market trends and then conduct surveys or interviews to gather detailed insights from your specific target audience. A great way for you to passively collect data to identify these trends and insights is through social monitoring software like Mention.

Integrating these different methods can help you dig deeper into your research and explore a broader range of perspectives, ultimately leading to a more comprehensive understanding of your findings.

Essential Secondary Market Research Tools and Resources

Resources like Google Scholar prove to be invaluable when it comes to conducting secondary research.

There are several tools and resources out there that can aid you when it comes to conducting secondary market research. Online databases such as Statista, MarketResearch.com, and IBISWorld offer comprehensive market reports and statistics.

Physical and digital libraries can provide you with access to a wealth of academic journals, books, and industry reports. Government websites like the U.S. Census Bureau and Bureau of Labor Statistics offer valuable demographic and economic data for your efforts.

Lastly, platforms like Google Scholar can also provide consolidated access to academic research papers. At the same time, additional sources like news websites and trade journals can offer data such as current industry insights.

Best Practices When It Comes to Utilizing Secondary Market Research

First, it’s important to follow several best practices to maximize the benefits of secondary market research.

Following these practices helps guarantee your findings’ overall credibility, relevance, and comprehensiveness.

Guaranteeing Your Data’s Credibility

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The accuracy of your secondary research hinges upon the trustworthiness of the sources you’ve utilized.

When assessing information, it’s important for you to carefully scrutinize the source’s reputation, the methodology employed for data collection, and the publication date. Doing so helps guarantee that you’re relying on credible and up-to-date information.

You should prefer sources like peer-reviewed academic journals, government publications, and reports from reputable industry associations. In addition, make sure that you cross-check data from multiple credible sources to help further verify its accuracy.

Regularly Updating Research Findings

To stay competitive in rapidly shifting markets and industries, you want to ensure that your secondary research data is current. To this end, try to review and update your data regularly to reflect the latest trends, technological advancements, and any ongoing market shifts.

Regularly revisit your research sources and incorporate new findings into your analysis to maintain relevance.

Combining Multiple Sources for Comprehensive Insights

Relying on a single source can limit the scope of the insights that you’re trying to get from your research. For a thorough market analysis, you need to utilize multiple sources of info.

You can also leverage tools and software to get even greater insights. Mention’s social listening tool proves particularly useful in this regard, providing data for insightful analytics at scale.

Adopting this multi-source approach helps cross-validate information and provides a more nuanced view of the market.

Tips for Avoiding Common Pitfalls

You can avoid the more common research pitfalls by being aware of potential biases in your sources and data.

Try to be critical of sources that might have an agenda, shady ownership backing them, or that present data in a skewed manner. You also want to ensure that the data you use is relevant to your research objectives.

Avoid the temptation to use outdated data and always prioritize information that directly aligns with your research goals.

Leveraging Secondary Market Research for Success

As you can see, secondary market research is an essential tool for businesses that want to gain valuable insights without the high costs and time commitments of primary research.

The value of secondary market research lies in its cost-effectiveness, time efficiency, and access to extensive data. It allows businesses to benchmark and analyze trends so that your organization can make informed and strategic decisions about how to proceed.

Despite its limitations, such as potential data biases and lack of specificity, secondary research remains an indispensable component of any well-rounded market research strategy.

With markets continuing to evolve even further, effectively utilizing secondary data will remain a key differentiator for successful businesses—and if you’re looking to monitor what people are saying about your brand or your competitors, get a demo or start a 14-day free trial of Mention today.