Market research is the process of systematically gathering, recording, and analyzing data and information about customers, competitors, and the market. Market research aides in: the creation of a business plan; launching a new product or service; fine-tuning existing products and services, and; expanding into new markets. It can be used to determine which portion of the population will purchase a product or service, based on variables like age, gender, location, and income level.

Market research is generally either primary or secondary. Primary market research involves direct testing, such as focus groups, surveys, field tests, and interviews or observations, each conducted or tailored specifically to that product. Secondary research uses information compiled from other sources that appears applicable to a new or existing product.   It is the summation of existing research and is relatively cheap and easily accessible; however, it is often not specific to your area of interest and the data used can be biased and/or difficult to validate.

Effective market research should answer the following questions:

• What is happening in the market? What are the trends? Who are the competitors?
• How do consumers talk about the products in the market?
• Which needs are important? Are the needs being met by current products?