Market Research vs. Market Analytics: Is There a Difference?

Though, as we will find out, the practices are distinct, but not alternatives. They work best in conjunction, amplifying each other's value. 

And the value each practice has is tremendous. In 2021, modern businesses can no longer afford to forgo both market research and market analytics. Both, done well, are directly correlated with revenue. 

Long story short, market research and market analytics are two of the most crucial business practices to improve your bottom line. But how are the two different? 

What is market research? 

Market research is the practice of collecting data directly from customers to validate hypotheses and make better business decisions. 

Customers, often referred to as the source, provide data in the form of feedback. And long gone are the days when feedback was restricted to forms, polls, and focus groups. Today, your customers leave their feedback on review platforms, like Yelp and Google, but also on social media platforms, like Twitter, Reddit, YouTube, Instagram, and TikTok. Market research aims to collect this data, analyze it for insights, and use them to make better business decisions. 

Take product development, for example. Making a product is expensive, and as a business owner, you should aim to lower its risk of failure and get the most bang for your buck. And that is where market research comes in. On the one hand, you can develop and ship a product based on what you think your customers like. On the other hand, you can actually find it out beforehand to develop and ship a product that delivers what they need. 

And market research goes beyond products and services. It can be called into action for a variety of business initiatives. Market research can be used to determine a fair price for your products or services, or it can be used to gauge your customers' perception of your brand image. 

In a nutshell, market research is a tool for validating your ideas. Have a new one? Find out who is most interested, and why. Learn what works and what does not. Do it all over again. 

What is market analytics? 

Market analytics also aims to collect market data, analyze it for insights, and use them to make better business decisions. However, market analytics aims to attain much broader, comprehensive insights. 

In fact, market research is a part of market analytics. The insights learned by research are combined with the insights learned by industry analysis, competitive analytics, sales, and customer analytics to gain a complete picture of the market. 

What is the difference? You could argue that market research's insights serve a short-term purpose. It tells you whether your next product will be successful. In contrast, market analytics' insights serve a long-term purpose. It illuminates industry trends, where you stand among your competition, and whether the product fulfils its small part to get you in a position to achieve your long-term vision. 

Market research vs. market analytics 

The two are not alternatives. Since one is a part or subset of the other, when you conduct one, you also, by logic, conduct the other. What counts is where you stop your research. 

Another thing of note is the increasing role of alternative data in market research and analytics. Business owners do not just rely on structured, quantified data for insights. Now, they also look at unstructured, non-traditional data found on social media, and in the usage and shopping habits of their customers. 

Which one should you choose, market research or market analytics? Both, of course. The two complement each other. One to fulfill your short-term goals, while the other to fulfill your long-term vision. In fact, you do not have to do anything. As a business owner, you should devote your time to do what you do best, while delegating market research and analytics to those who do that best. 

Determine the right direction for your business and a strategy for sustained growth. Contact SG Analytics today.