The prevalence and usefulness of market research: An empirical investigation into 'background' versus 'decision' research

Using information effectively has become a critical determinant for gaining competitive advantage and enhancing business performance. The type and extent to which market research information is used can play a significant role in a firm's level of performance. Surprisingly, little empirical research has been conducted on the usefulness of market research. This paper examines the prevalence of type ('background' and 'decision' research) and perceived usefulness of market research commissioned for enhancing business performance. Information relating to 6036 research projects collected from 68 organisations was reviewed, and a sample of 1550 market research projects was selected for the study. The data were collected by personal interviews and a mail questionnaire relating to 1550 projects on four dimensions of 'usefulness' (overall usefulness, actionable, value and market understanding) and on respondents' level of 'involvement' on those projects. 'Background research' predominates over 'decision research' as a research activity, but was regarded as less useful by managers over the first three dimensions of usefulness. This result was not compromised by the extent of manager involvement. The result was more marked when the dimensionality of the ratings was studied using a factor analysis. The study has produced evidence that if the current emphasis on 'background research' were to shift to 'decision research' then market research would be deemed more useful by managers.