A market research takes place following five fundamental steps: 

• Definition of the research problem and objectives 

In market research, the first step is to define its problems and objectives. The company must pay attention and not define the problem in too broad or too limited terms. 

• Research planning 

The second step involves the preparation of a research plan that includes data sources, research methods, research tools, sampling plan, forms of communication and research costs. 

• Information gathering 

The third step includes gathering information: it is the most expensive part of a market research and also the most exposed to errors. With the development of ICT, the process of collecting information has become simpler and less expensive (e.g. barcodes, online questionnaires). 

• Analysis of information 

From the data collected it is necessary to reach conclusions. It is up to the researcher to sort the data in tables and apply different statistical methods to reach useful conclusions (frequency distribution, averages, variability measurement). 

• Presentation of conclusions and decisions

 In the final phase of a market research, the researcher must present the conclusions to the company management. Research helps management to better understand the problem and to decide on a concrete situation based on the data obtained. 

The end result of a market research is the marketing plan.

 Source: Kotler, P. 2004. Management trženja (Marketing management, 11. ed.). Ljubljana: GV Založba.

The marketing plan is one of the most important results of the marketing process. Due to rapid changes in market conditions, planning has become an ongoing process in companies. Both the content and the length of the plans vary greatly according to the companies (from less than 5 pages to over 50). The development of the marketing plan requires collaboration between all company functions (production, purchase, marketing, distribution, finances, etc.), therefore a good marketing plan is always the result of teamwork.

The components of a marketing plan are: 

• Executive summary and content index: brief description of the main objectives and recommendations.
• Current market status: fundamental data on sales, markets, costs, profits, competitors, sales channels and the macro environment.
• Analysis of opportunities and crucial issues: SWOT analysis
• Objectives: main financial and marketing objectives (planned sales, market share, profit, etc.)
• Marketing strategy: definition of target markets, the needs that the company will satisfy, and market positioning.
• Activity programs: definition of the marketing programs that the company will put in place to achieve the objectives. The following questions must be answered: what will be done, when, who will be responsible, how much will it cost, how will progress be measured?
• Financial projections: expected sales volume, average price, planned profits, expected volume of production costs, acquisitions, distribution, expected profits. Based on this, the budget is prepared.
• Control of implementation: monitoring and adaptation of the implementation of the plan. The management, if necessary, can initiate corrective measures.

Source: Kotler, P. 2004. Management trženja (Marketing management, 11. ed.). Ljubljana: GV Založba.

The objectives of the marketing plan can be summarized in four fundamental points: 

• Identify the needs and desires of the buyers,
• Identify and define the characteristics of the market niches on which the company wants to focus,
• Analysis of the competitive advantages and disadvantages and definition of the marketing strategy,

Creation of a marketing mix that will allow the company to achieve the set goals.

A market research can be defined as "planning, collection and planned analysis of data, with a report on the data and results important for a given market position that the company faces" (Kotler, 2003, 129). 

Companies can carry out market research within their market research departments, or they can make use of external consultants specialized in this type of service. It is mainly small companies that do not have sufficient resources for their own staff to choose external consultants. The task of market research companies is to carry out a market investigation and allow customers to understand a specific problem in depth.

Market research can be: 

• Exploratory (the goal is to clarify a specific problem and suggest solutions, e.g. the interest in our products is decreasing, why?),
• Descriptive (the goal is to obtain quantitative data, e.g. who are our buyers, what are the advantages of our products?),
• Reasons (the goal is to understand the cause-effect connections between certain factors, e.g. will customers buy more if you change the packaging?). 

Source: Kotler, P. 2004. Management trženja (Marketing management, 11. ed.). Ljubljana: GV Založba.

When planning market research, an effective information gathering process must be defined. Therefore managers must decide on: 

Sources of data

 The company can collect primary, secondary or both types of data. The primary data are those that are collected from scratch for a specific research, while the secondary ones are those that already exist and have been collected for some other purpose. Since the use of secondary data compared to primary is less expensive, companies generally check first whether a search can be performed with secondary data. If there is no secondary data available, the researcher must collect the data himself with appropriate methods.

Research methods 

Primary data collection methods: 

• Observation (people, their behavior and the environment are observed)
• Group interviews (in groups of six to ten people, the interviews are managed by a moderator)
• Investigation (with questionnaires you can find out what people love, what makes them happy, what they are willing to pay a higher price for),
• Monitoring of purchasing behavior (data collection with loyalty cards, catalog purchases, etc.) e
• Sample searches (comparison between different groups to know the cause-effect relationships).

 Research tools

Primary data can be collected with three basic research tools: 

• Questionnaires: they are the most common research tool. They consist of a series of closed or open questions or in combination. You must create questions with an appropriate form and sort them according to a certain criterion.
• Psychological tools: people's feelings and beliefs can be studied with psychological tools, for example in-depth interviews and tests of various kinds.
• Mechanical tools: with these, researchers measure the reactions of individuals to certain events, such as the transmission of an announcement. This evaluates people's interests, emotions, eye movements, etc.

In recent years, qualitative research tools (e.g. informal talks) are becoming increasingly popular in market research.

 Sampling plan 

When the company defines the research methods and tools, it must prepare a sampling plan, which provides for the definition of the following elements: 

•     Sampling unit (who is being studied),
•     Sample size (how many people need to study),
•     Sampling procedure (how to choose people for the sample).

 Communication forms

 The latest decision in the context of a market research plan concerns the methods of communication with the people included in the sample. The company can decide to communicate personally with the target population, by mail, by phone or via the web.

 Source: Kotler, P. 2004. Management trženja (Marketing management, 11. ed.). Ljubljana: GV Založba.

Primary sources of information

 The primary data is that which marketing managers collect from scratch for a specific search. Much of the market research requires a number of primary data. The primary sources of information are: 

• personal questionnaires,
• telephone inquiries,
• postal inquiries,
• online surveys,
• observation,
• group talks, 
   

Secondary sources of information

Secondary data are those that already exist and have been collected for some other research. The use of secondary data is less expensive than that of primary data, because they are already available. The secondary sources of information are: 

• state or private entities,
• various publications (magazines, catalogs, reports),
• online databases (ECHO),
  
  
  

Source: Kotler, P. 2004. Management trženja (Marketing management, 11. ed.). Ljubljana: GV Založba.

Certain market research can induce a sense of agitation of privacy invasion among consumers. Marketing managers must therefore guarantee the ethics of the search. The following are the measures by which the ethics of a search can be guaranteed: 

• The researcher must guarantee the anonymity of all collaborators.
• Only consumers who have agreed to cooperate and know how the search will proceed can be included in the search.
• When composing questionnaires, it is necessary to avoid provocative and inadequate questions that can induce stress and embarrassment for consumers.
• The researcher must not attempt to obtain data from collaborators that could harm them (e.g. maximum price they are willing to pay or minimum level of services),
• The survey collaborators must not be misled about the commission of the research, its purposes, results and about the use of the data obtained.
• Researchers should not use coercive occult techniques (e.g. research on soldiers or prisoners).

To develop the questionnaires, the researcher must have a lot of knowledge and experience. Although there are many different methods of preparing a questionnaire, these steps are typically followed: 

• Research problem definition,
• Definition of the data collection method,
• Selection of the type of questionnaire,
• Definition of the content of the questions,
• Processing and organization of applications. 

Before submitting the questionnaire to our target group, it is necessary to test it. Typically the test takes place in three stages. In the first, the questionnaire is evaluated by collaborators or expert acquaintances. In the second, the questionnaire is tested with an individual survey of a small group (three to five people). In the third phase, the questionnaire is tested on a small sample of the target group. The questionnaire test allows you to eliminate or replace any unclear or ambiguous questions. After the test, the final version of the questionnaire is drawn up.

For each question, check: 

• If it is necessary
• If instead of a question it would take several
• Whether respondents will answer the question
• If all respondents want to answer a certain question

In processing the questionnaire, the researcher can choose between two types of questions:

Open questions

 The interviewees answer the open questions in text form, therefore they allow to obtain a wide spectrum of information. Open questions are useful if the researcher wants to understand how and what people think. On the other hand, open questions are more difficult to process statistically.

Open questions can be / foresee: 

• Unstructured questions,
• Completing a sentence,
• Completing a story,
• Word associations,
• Completing a drawing.
    

Closed questions

When answering closed questions, respondents can choose from predefined answers. The proposed answers must offer a broad spectrum of possible answers and must be mutually exclusive. Answers to closed questions are easier to sort and statistically process.

Closed questions can be / predict: 

• Questions with as many answers as possible,
• Likert scale,
• Scale of importance,
• Range of importance,
• Dichotomous questions. 

When processing the questionnaire, the order of the questions is fundamental. It is preferable to start the questionnaire with general questions and continue with other more specific ones. Difficult and delicate questions must be asked at the end. It is also preferable to start with more interesting questions to awaken the interest of the interviewees.

Indications for the preparation of the questions: 

• The questions must be short and simple,
• They don't have to force certain responses,
• Avoid too technical terms,
• Avoid ambiguous words,
• Be precise and clear,
• The default answers must be logical