Market Research vs User Research: How To Overcome Uncertainty

Creating a digital product from scratch can make for an exciting process but never a smooth ride. But by doing the right research at the right time, you can get the information you need to advance. Easier said than done... Is it not just a question of market research vs user research?

We wrote this to help you choose the right research methods more easily.

In this article we answer:

  • How do we distinguish between types of research?
  • What characteristics define market research vs user research?
  • How do we combine market research and user research?

Whether a product manager working in a big company or the owner of a startup, you face a multitude of uncertainties along the way. When taking on the challenge of converting an idea into a real product, you identify the target users and their pain points.

You also find out if your solution works for them and analyze how they use it. How do we decide then which way to go whenever we come to a crossroads?

At UX studio, we strongly believe that research provides the answer! But choosing the right type of research for the right questions at the right time doesn’t come so straightforwardly. It is not just about market research vs user research anymore.

So how should you do it then? Let’s take a look at some of the questions you might have along the way.

Market research vs user research: uncertainty

So many questions regarding research. What should I do?

  • Does the need for our product exist? How big of a potential market has it got?
  • What competing products have already entered the market? What market shares have they gained?
  • Who would we see as the customers for our product? What are they trying to accomplish? What pain points and motivations have they got?
  • How do potential users currently solve their problems?
  • How likely will they buy our product? How much would they pay?
  • What features do they find the most important?
  • Does our product solve their problems? How intuitively can they use the product?
  • How do they use it? How satisfied does it leave them?
  • How can we get more of them?

We know that questions like these keep coming and they can overwhelm us sometimes. Don’t panic. Doing the right research can give the answers you need to move on and create a great product. However, things could look a bit fuzzy. So, what type of research do you need and when?

In a previous post, my colleague Alexandra explored the kinds of user research methods product managers have at hand at each step of the product development life cycle in order to make informed decisions.

Now I want to take a step back and think of research in general. Some questions might not find the best answers applying user research methods. Sometimes we need to turn to market research to get the relevant and reliable answers we need. And use other tools as well.

So not all research works the same?

Market research vs user research: Wait what? meme

Exactly. The type of research depends on the questions you want to answer and the kind of information you need. Take two of the most important questions we face at the beginning of a project: Does the market have the need for a product like we want to build and how much?

The user research approach

A UX researcher would try to find answers by conducting interviews with potential users. Ideally, they would spend time observing them in their environment (ethnography). They would pay special attention to user behavior observing the problems they face and how they solve them.

The interviews should provide information on:

  • What the people want to achieve;
  • How they currently do it;
  • What problems they face along the way; and
  • What motivates them to keep going.

The research should indicate if a need for a product like we envision exists. However, it wouldn’t say anything about how much need exists (how many people have the problem, with what frequency, etc.).

Market research vs user research: iceberg illustration

The market research approach

A market researcher would also try to conduct interviews with potential users. This is where the question market research vs user research comes in. Market researchers would concentrate on the product idea’s appeal, key purchasing factors and other possible solutions.

They would follow the interviews with a survey on a representative sample from the target group. It would find out the product’s occurrence and frequency, the current solution, the likelihood of using the new product, and user demographic characteristics.

The survey results would add a quantitative dimension to the qualitative insights. Consequently, they give an idea about the amount of need on the market, and in turn an estimate of the new product’s potential.

This example shows how user research and market research clearly differ in strategy. It also indicates that the insights they provide complement each other.

User research aims to find people’s true pain points and motivations based on their behavior. However, market research aims to find people’s attitudes towards a product and estimate the size of the potential market.

Market research vs user research: crowd

So how exactly do user research and market research differ?

Market Research: Broad insights focused on attitudes

Market research primarily involves getting the broad picture, uncovering high-level information regarding a specific industry. Market researchers use mainly quantitative methods, meaning they focus on numbers. They run studies on large representative samples so to infer results for the whole population.

The results of surveys reflect the situation in the whole population within an acceptable margin of error. This can make us quite sure of the average potential user’s age, income level, level of education and other general characteristics.

Market research tends to give more weight to attitudinal data (what people say about themselves or about what they would do) rather than to concrete behaviors in a certain context. They use insights from market research primarily to inform marketing decisions.

User Research: Detailed insights focused on behavior

User research employs a very different strategy. It has nothing to do with market size and shares, trends, market segments, demographics, and less to do with attitudinal responses. Instead, it looks at people’s behavior, how they solve everyday problems, use a product, etc. It does not deal with broad data, but rather very specific, deep insights regarding users.

User research provides a direction about how to design a product, and to what extent it meets user needs. We can use significantly smaller sample sizes because the results don’t need statistical accuracy.

User research focuses on producing qualitative data about what lies behind what people say. It looks specifically at what they literally do while using a product. Also, it prioritizes design guidance and improves the user experience.

Market research vs user research: differences in techniques
Market research vs user research (Source: Human Factors International)

Can’t I just choose one and adapt the results to fit my needs?

Not really. Both research methods play an important role, and you must avoid using one in the wrong place. Relying on market research insights to inform UX design decisions works equally as bad as relying on user research insights to derive market size.

UX design requires different information from what market research delivers. It also estimates market size, and market shares require different information.

Also, a UX researcher or a market researcher requires different knowledge and skill sets. All-rounders who can equally master both come along a lot less often.

When do I apply user research and when market research?

Apply market research early in the product development cycle

Market research plays an important role during the product development cycle’s early stages for analyzing the potential to make money. Here we need business insights on market size, trends and competition, and to identify product/service areas that interest people.

Apply user research to understand users and guide the design process

After the initial market research, user research will take over and dive into one of the focus areas we want to understand more deeply.

User research brings useful insights for building an innovative product: validating specific design decisions, deriving features and testing product ideas.

Once we have some concrete product ideas, market research again plays an important role. It helps in evaluating which of these concepts will most likely sell successfully and also in identifying approximate price points.

Combine market and user research to make better decisions

For making the best decisions, understand when to use both market research and user research. See below how to combine user research and market research throughout the product development cycle.

Market research vs user research: table with differences
Market Research vs User Research: They answer different questions and come up in different stages

The most important thing for user experience professionals to know is when marketing research is needed, and when user experience research is needed. If you understand how these two methodologies work together through a product lifecycle, you will be able to work effectively with marketing departments. You can demonstrate the value of including user experience research in their projects because you are able to explain how it complements the market research they are already conducting.”

Apala Lahiri Chavan
Chief Oracle and Innovator
Human Factors International

Summary: Market Research vs User Research: Overcoming Uncertainty

#1 Research methods don’t all work the same. Think of the kind of information you need and choose a method that can provide the relevant answers.

#2 Although the line between and user research and market research looks quite blurred, don’t confuse the two or use them interchangeably!

#3 Market research mainly provides broad, quantitative insights about people’s attitudes and their willingness to buy a product. This, in turn, informs marketing decisions.

#4 User research mainly provides deep, focused qualitative insights about people’s behavior and how they would use a product. As a result, this informs design decisions.

#5 Used together, user research and market research can help product managers make better decisions and provide a clear roadmap to create successful products.

Want to read more?

What is beyond market research vs user research? Read more related articles to research on our blog: Product Manager’s Guide To UX Research and Nine UX Research Methods Product People Should Know.

Want to know more about the UX process? Download our free ebook Product Manager’s Guide To UX Design to read our UX case studies and learn about tools and tricks.

We also have additional reading for you, an actual hardcover Product Design book as well! And we ship it worldwide – for free!

 

UX Researcher with an incurable case of curiosity. Passionate about circular design and sustainability. Convinced that through smart design, the world can be changed for the better.