Tuesday, August 16, 2005

Importance of Qualitative Research

In yesterday's entry, I briefly described the difference between quantitative and qualitative research. Since qualitative research tends to be less "scientific", you might consider it less valuable than quantitative research. You would be mistaken.

Imagine you're writing a business plan and including a section on the size of the market for your product (i.e. the estimated number of people who likely or potentially will buy it). The size of the market is a numeric quantity, so shouldn't you focus on quantitative research to determine it?

While quantitative research is necessary for sizing the market, you must segment the market before you can size it. I.e., you must divide the population into groups who are more or less likely to buy your product.

Segmenting the market requires a psychographic study. You can't just guess about the demographic characteristics that would make a buyer more or less likely to buy. You need an in-depth understanding of the situations and problems that different kinds of prospective buyers face. You segment the market along these psychographic lines. Then you determine how many people exist within each segment.

Using psychography to segment the market therefore requires qualitative research. This qualitative research is a prerequisite to the quantitative research into the size of each market segment.

Don't underestimate the importance of qualitative research!

No comments: