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Market Research Methods

Marketing research knowledge has significantly increased in response to growth in disruptive innovations including the internet and technology development. In my experience, I have found that market research has been essential when repositioning my business to support product advancement, and in helping discover marketing opportunities and expanding market shares through various conveyance channels. Additionally, marketing research has helped influence the performance and effectiveness of my marketing strategies by helping to find my ideal customer with little error and without wasting time and resources on customers that were never going to purchase.

To help with analyzing markets, there are two useful forms of marketing research; primary and secondary.

Primary Research. This is a research methodology where you interact with your customers and gather as much information as you can directly from them. The information is generally collected through surveys, questionnaires, feedback forms, and interviews.

Secondary Research. This research relies on information which has been collected by others (blogs, previous researchers, data channels). You should conduct this type of research by collecting and analyzing articles, web pages, and books as references for the collected research data.

Phenomenology. A phenomenology research method uses analysis to capture individual customer experiences. This method is used for unfolding customer experiences by examining the uniqueness and commonalities of events and circumstances. The data collection techniques used in phenomenology research include in-depth analysis, documentary, and observation.

Quantitative, Qualitative, and Mixed Methods

When conducting research, you should first decide the method of research you intend to use. Research study methodologies are characterized as either qualitative, quantitative, or a combination of both, which is referred to as mixed methods. Of these methods, none can be considered the best method without factoring in the goals and objectives of your research.

I know it may seem a bit overwhelming, but understanding research methods are critical if you desire a certain outcome for your marketing efforts. For example, when I’m putting together an AdWords campaign, I would rather put together my campaign based on data collected from a quantitative method versus a qualitative method. Otherwise, I would waste time and money guessing what to do based on trial and error. A quantitative research method is better for helping to pinpoint your customer and develop a more effective marketing campaign.

Quantitative. A quantitative research method is beneficial for collecting data in the form of tests, reliance, probability theory, and surveys for analyzing statistical hypotheses that relate to your business, marketing goal, or research questions. A quantitative research method is best used when you want to analyze numbers. For example, you could use a quantitative approach when sending out a survey where you expect to get the survey results in numerical format, or if the survey has multiple choice questions.

Qualitative. Qualitative research consists of using real-world experiences and interpreting the phenomena. Unlike quantitative research, a qualitative examination is non-measurable. This research method can be used to help you understand and discover experiences, perspectives, and insight of your customers. An advantage of a qualitative approach is that the study participants are not constrained to a predetermined set of responses such as those in multiple choice or numerical questions. Meaning, through qualitative research, the participants would give their broad perception versus clicking a checkbox or radio button like in surveys.

Unlike a quantitative method, a qualitative examination technique can help to assess why customers behave a certain way. The method also helps in discovering boundaries that influence thought by breaking down points of interest and gathering information from in-depth sources. A quantitative method often makes the assumption that there is a singular truth that exists, which does not include human perception. A drawback of using a quantitative approach to collect data is that it is expensive considering the amount of time needed to collect and analyze the data.

Mixed Methods. Mixed methods are useful when you want to combine qualitative and quantitative methods by linking their differences. The key principle of mixed methods is that various forms of data can be collected by using multiple strategies and methods. Mixed methods can assist in reflecting complementary strengths and weaknesses of qualitative and quantitative methods, and produce opportunities for approaches with weaknesses by correcting method biases.

Determining whether to use a qualitative or quantitative method is dependent upon the importance of how you desire to collect your data. Simply stated, qualitative techniques define and describe while quantitative techniques estimate and quantify. When creating a new marketing strategy, neither qualitative nor quantitative measures are more important than the other when determining value and sales. If you are confused on which method to use, testing both measures will help you find the best outcomes.

Networks to Market Your Brand

1. DMOZ Directory 

– DMOZ is a great directory service that ranks very well within Google. Any link listed in DMOZ gets top priority with Google and can drastically help increase the page rank and position of the website. The issue with DMOZ is that it is hard to get listed in. There is a long approval process that doesn’t accept everyone and it will take months to get listed within this directory if it actually does get approved, which there is a high chance that it wont.

2. Yahoo Directory 

– The yahoo directory is well known and can easily increase the page rank of its subscribed members. What does it take to be a member? Only $299 per year recurring is all. While this is a great website to get listed on, it is pretty expensive to many. While most may see it as a rip-off due to the pricing, if the calculations are done correctly, it’s really only $25 per month. This issue with getting listed here is that the directory doesn’t get much business besides from advertisers. Nonetheless, it does give a valuable backlink and drastically helps with ranking position on yahoo.com.

3. Online Design Directory – Sponsored Ad

This website shows at the top of the listing when “web design” is searched for within Google and other search engines. It’s a fairly new website, but it has created quick buzz and has ranked fast within the search engines. By signing up with a sponsored ad for $20 per month, a website text link can be listed on each of its 60,000 plus pages. This is great for being searched and greatly increases backlinks.

4. Web Designers Directory

This is another great website directory that shows up on the top of the searched keyword “web design.” Ways to use this website would be for backlinks and for its credibility. Listings can be done by either getting listed in the directory or paying for a sponsored text or banner link.

5. Xemion.com – Sponsored Ad

Here is another example of a top ranked website that accepts sponsored ads. This website has a low rank for the Texas web design category. However, the site is well known and ranks high within search engines.

6. iFreelance Directory

This website is for freelancers, however, those looking for a web designer normally are just looking for a good price. Many companies market on this site and for good reason. This site places a link, portfolio, and contact information for each company or individual that wishes to be listed in a particular category. The ultimate goal of this site is for buyers to get estimates from bidders on their upcoming project. Normally the lowest bid and value wins.

7. Craigslist

This is a free service that is pretty cheap, but it gets the job done. By placing a local advertisement up within the computer category, users can use the search word “web design” and locate the company’s ad and link to its website. This website gets high ranks and provides easy backlinks and use of keywords for search engines.

8. Twitter

Twitter is a pretty broad website to use to place an ad on. However, it has great credit and a great page rank. What makes this website better than other social networking sites for marketing is that it does not cloak external links. This allows for search engines to find the link easy and link it back to the company website.

9. Merchant Circle

This is a simple company that lists local companies for its users. By the user typing their keyword into the search bar and then entering their city, they may easily find what they are looking for. This website gives a credible backlink, but it doesn’t help with page rank as this website only has a high page rank on its home page. Though it doesn’t help with page rank, it is a good website to use for being found.

Market Efficiency Theory

Market Efficiency Theory
Market efficiency was formulated by Eugene Fama in 1970, labeled as efficient market hypothesis. His theory suggests that stock and market value are based on publicly available information. Investors invest with the goal that their investment will generate a positive return on their investment. An efficient capital market is when a stock price reflects publicly available information that may affect the stocks value, which could benefit investors. Efficient markets generate random patterns that cannot be predicted, and an investor cannot factually predict a stock value with secretive information.

Less Efficient U.S. Markets
Markets are much more inefficient than they used to be, and unreliable information could cause investors to receive inefficient values. If markets are unreliable, the value could potential plummet and non-informed investors may not be interested in purchasing new stock. Furthermore, An inefficient market would likely be placing a market value above or below its true value. An inefficient market creates unfair advantages for certain investors who would not otherwise have access to the company’s information. Markets become less efficient often due to greed, economic involvement, negligence, and lack of communication.

Markets in Other Countries
Many studies have found that market prices are difficult to predict. Compared to the United States, other countries also have problems with market inefficiency. Market efficiency asserts that there is no pattern or trends that can be used to predict future value. In the Indian capital market for instance, market inefficiency exist that contradict the efficient market hypothesis. A study, which examined a calendar anomaly within the stock market; found that stocks often held until after the New Year present a higher return rate, and that Monday is considered the worst day of the week to invest. While this isn’t considered inside information, it does create a predictable trend that creates a level of efficiency to use in predicting market trends and potential.

Finding efficiency within the stock market may seem fairly simple with the use of technology and cheap software tools that can find patterns within stock prices. However, the reality is that there is no way in determining the direction of a stock by using computer technology or human assumptions. In addition, if exploits did exist, they would be found and corrected to prevent future defrauding.

With the efficiency market hypothesis, the securities will always reflect the available public information. No system, tool, calculation, or individual investor has access to secret information that would help them generate a rate of return above others. Consequently, investors should always expect to receive a fair value for their securities.

To determine the direction of a stock, investors must be skilled at analyzing data, predicting stocks, and have the ability to comprehend statistics and understand the stocks industries. To achieve this, it takes an investor that is passionate and has the time to evaluate the market.

In addition to rationality, independent deviations from rationality, and arbitrage, t he efficiency market hypothesis makes the assumption that there are three levels of market efficiency’s. The three levels assume that the value of an investment should reflect all available information. Prices should change based only on publicly unexpected information. The hypothesis is considered a model based on how markets tend to work and not how they should work. The three levels of market efficiency include strong, semi-strong, and weak (Maguire, 2010; Ross, Westerfield, & Jaffe, 2013). The weak level of efficiency does not base it results on reliable data such as earnings, forecast, or company announcements. However, they are often random and based on mathematical assumptions relating to historical data. A market is considered semi-strong if it can be predicted by using publicly available information. Information that helps predict a market using a semi-strong efficiency level includes information regarding accounting statements, and historical data. The strong efficiency level uses all publicly and privately available information to determine a stocks value.

Insider trading behavior is affected by expected trading profits from private information, and potential litigation risk. Managers tend to avoid trading before company disclosures so that they may avoid litigation risk. To reduce the probability of litigation, managers provide higher quality disclosures before insider trading. Furthermore, to avoid litigation, insiders often avoid profitable trades before earnings announcements, but will trade after the announcement in an attempt to profit from their future earnings based on the announcement.

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