Observational research involves gathering primary data by observing relevant people, actions, and situations. For example, food retailer Trader Joe’s might evaluate possible new store locations by checking traffic patterns, neighborhood conditions, and the locations of competing Whole Foods, Fresh Market, and other retail chains.

Researchers often observe consumer behavior to glean customer insights they can’t obtain by simply asking customers questions. For instance, Fisher-Price has established an observation lab in which it can observe the reactions little tots have to new toys. The Fisher-Price Play Lab is a sunny, toy-strewn space where lucky kids get to test Fisher-Price prototypes under the watchful eyes of designers who hope to learn what will get them worked up into a new-toy frenzy. In the lab, some 3,500 kids participate each year testing 1,200 products annually. “Our designers watch and learn from how [children] play,” says a Fisher-Price child research manager. “It really helps us make better products.”10

Marketers not only observe what consumers do but also observe what consumers are saying. As discussed earlier, marketers now routinely listen in on consumer conversations on blogs, social media, and websites. Observing such naturally occurring feedback can provide inputs that simply can’t be gained through more structured and formal research approaches.

A wide range of companies now use ethnographic research. Ethnographic research involves sending observers to watch and interact with consumers in their “natural environments.” The observers might be trained anthropologists and psychologists or company researchers and managers. For example, Coors insights teams frequent bars and other locations in a top-secret small-town location—they call it the “Outpost”—within a day’s drive of Chicago. The researchers use the town as a real-life lab, hob-knobbing anonymously with bar patrons, supermarket shoppers, restaurant diners, convenience store clerks, and other townspeople to gain authentic insights into how middle American consumers buy, drink, dine, and socialize around Coors and competing beer brands.11

Global branding firm Landor launched Landor Families, an ongoing ethnographic study that has followed 11 French families intensely for the past seven years. Landor researchers visit the families twice a year in their homes, diving deeply into both their refrigerators and their food shopping behaviors and opinions. The researchers also shop with the families at their local supermarkets and look over their shoulders while they shop online. The families furnish monthly online reports detailing their shopping behaviors and opinions. The Landor Families study provides rich behavioral insights for Landor clients such as Danone, Kraft Foods, and Procter & Gamble. Today’s big data analytics can provide important insights into the whats, whens, and wheres of consumer buying. The Landor Families program is designed to explore the whys. According to Landor, “There is no better way to understand people than to observe them in real life.”12

Observational and ethnographic research often yields the kinds of details that just don’t emerge from traditional research questionnaires or focus groups. Whereas traditional quantitative research approaches seek to test known hypotheses and obtain answers to well-defined product or strategy questions, observational research can generate fresh customer and market insights that people are unwilling or unable to provide. It provides a window into customers’ unconscious actions and unexpressed needs and feelings.

However, some things simply cannot be observed, such as attitudes, motives, or private behavior. Long-term or infrequent behavior is also difficult to observe. Finally, observations can be very difficult to interpret. Because of these limitations, researchers often use observation along with other data collection methods.

Survey research, the most widely used method for primary data collection, is the approach best suited for gathering descriptive information. A company that wants to know about people’s knowledge, attitudes, preferences, or buying behavior can often find out by asking them directly.

The major advantage of survey research is its ­flexibility; it can be used to obtain many different kinds of information in many different situations. Surveys addressing ­almost any marketing question or decision can be conducted by phone or mail, online, or in person.

However, survey research also presents some problems. Sometimes people are unable to answer survey questions because they cannot remember or have never thought about what they do and why they do it. People may be unwilling to respond to unknown interviewers or about things they consider private. Respondents may answer survey questions even when they do not know the answer just to appear smarter or more informed. Or they may try to help the interviewer by giving pleasing answers. Finally, busy people may not take the time, or they might resent the intrusion into their privacy.

Whereas observation is best suited for exploratory research and surveys for descriptive research, experimental research is best suited for gathering causal information. Experiments involve selecting matched groups of subjects, giving them different treatments, controlling unrelated factors, and checking for differences in group responses. Thus, experimental research tries to explain cause-and-effect relationships.

For example, before adding a new sandwich to its menu, McDonald’s might use experiments to test the effects on sales of two different prices it might charge. It could introduce the new sandwich at one price in one city and at another price in another city. If the cities are similar and if all other marketing efforts for the sandwich are the same, then differences in sales in the two cities could be related to the price charged.

Mail questionnaires can be used to collect large amounts of information at a low cost per respondent. Respondents may give more honest answers on a mail questionnaire than to an unknown interviewer in person or over the phone. Also, no interviewer is involved to bias respondents’ answers. However, mail questionnaires are not very flexible; all respondents answer the same questions in a fixed order. And mail surveys usually take longer to complete and response rates are often low. As a result, more and more marketers are now shifting to faster, more flexible, and lower-cost email, online, and mobile phone surveys.

Telephone interviewing is one of the best methods for gathering information quickly, and it provides greater flexibility than mail questionnaires. Interviewers can explain difficult questions and, depending on the answers they receive, skip some questions or probe on others. Response rates tend to be higher than with mail questionnaires, and interviewers can ask to speak to respondents with the desired characteristics or even by name.

However, with telephone interviewing, the cost per respondent is higher than with mail, online, or mobile questionnaires. Also, people may not want to discuss personal questions with an interviewer. The method introduces interviewer bias—the way interviewers talk, how they ask questions, and other differences that may affect respondents’ answers. Finally, in this age of do-not-call lists and promotion-harassed consumers, potential survey respondents are increasingly hanging up on telephone interviewers rather than talking with them.

Personal interviewing takes two forms: individual interviewing and group interviewing. Individual interviewing involves talking with people in their homes or offices, on the street, or in shopping malls. Such interviewing is flexible. Trained interviewers can guide interviews, explain difficult questions, and explore issues as the situation requires. They can show subjects actual products, packages, advertisements, or videos and observe reactions and behavior. However, individual personal interviews may cost three to four times as much as telephone interviews.

Group interviewing consists of inviting small groups of people to meet with a trained moderator to talk about a product, service, or organization. Participants normally are paid a small sum for attending. A moderator encourages free and easy discussion, hoping that group interactions will bring out deeper feelings and thoughts. At the same time, the moderator “focuses” the discussion—hence the name focus group interviewing.

In traditional focus groups, researchers and marketers watch the focus group discussions from behind a one-way mirror and video-record sessions for later study. Through videoconferencing and internet technology, marketers in far-off locations can look in and listen, even participate, as a focus group progresses.

Focus group interviewing has become one of the major qualitative marketing research tools for gaining fresh insights into consumer thoughts and feelings. In focus group settings, researchers not only hear consumer ideas and opinions, they also can observe facial expressions, body movements, group interplay, and conversational flows. However, focus group studies present some challenges. They usually employ small samples to keep time and costs down, and it may be hard to generalize from the results. Moreover, consumers in focus groups are not always open and honest about their real feelings, behaviors, and intentions in front of other people.

To overcome these problems, many researchers are tinkering with the focus group design. Some companies are changing the environments in which they conduct focus groups to help consumers relax and elicit more authentic responses. For example, Lexus hosts “An Evening with Lexus” dinners in customers’ homes with groups of luxury car buyers to learn up close and personal why they did or did not buy a Lexus. Other companies use immersion groups—small groups of consumers who interact directly and informally with product designers without a focus group moderator present.

Research and innovation consultancy The Mom Complex uses such immersion groups to help brand marketers from companies such as Unilever, Johnson & Johnson, Kimberly-Clark, Kellogg, Playskool, and Walmart understand and connect with their “mom customers”:13

According to The Mom Complex, America’s 80 million moms control 85 percent of household purchases, yet three out of four moms say marketers have no idea what it’s like to be a mother. To change that, The Mom Complex arranges “Mom Immersion Sessions,” in which brand marketers interact directly with groups of mothers, who receive $100 in compensation for a two-hour session. Rather than the usual focus group practice of putting the marketers behind a one-way mirror to observe groups of moms discussing their brands, the participants and marketers sit in the same room. Guided by a discussion facilitator, the moms begin by educating the marketers about the realities of motherhood—“the raw, real ugly truth about being a mom.” Then the moms and marketers work together to address specific brand issues—whether it’s new product ideas, current product problems, or positioning and communications strategy. The goal is to “turn the challenges of motherhood into growth opportunities for brands.”

Individual and focus group interviews can add a personal touch as opposed to more numbers-oriented, big data research. They can provide rich insights into the motivations and feelings behind the numbers and analytics. “Focus groups are the most widely used qualitative research tool,” says one analyst, “and with good reason. They foster fruitful discussion and can provide unique insight into customers’ and potential customers’ needs, wants, thoughts, and feelings.” Things really come to life when you hear people say them.14

The internet has had a dramatic impact on how marketing research is conducted. Increasingly, researchers are collecting primary data through online marketing research: internet and mobile surveys, online focus groups, consumer tracking, experiments, and online panels and brand communities.

Online research can take many forms. A company can use the internet or mobile technology as a survey medium: It can include a questionnaire on its web or social media sites or use email or mobile devices to invite people to answer questions. It can create online panels that provide regular feedback or conduct live discussions or online focus groups. Researchers can also conduct online experiments. They can experiment with different prices, headlines, or product features on different web or mobile sites or at different times to learn the relative effectiveness of their offers. They can set up virtual shopping environments and use them to test new products and marketing programs. Or a company can learn about the behavior of online customers by following their click streams as they visit the online site and move to other sites.

The internet is especially well suited to quantitative research—for example, conducting marketing surveys and collecting data. More than 90 percent of all Americans now use the internet, making it a fertile channel for reaching a broad cross-section of consumers.15 As response rates for traditional survey approaches decline and costs increase, the internet is quickly replacing mail and the telephone as the dominant data collection methodology.

Internet-based survey research offers many advantages over traditional phone, mail, and personal interviewing approaches. The most obvious advantages are speed and low costs. By going online, researchers can quickly and easily distribute surveys to thousands of respondents simultaneously via email or by posting them on selected online and mobile sites. Responses can be almost instantaneous, and because respondents themselves enter the information, researchers can tabulate, review, and share research data as the information arrives.

Online research also usually costs much less than research conducted through mail, phone, or personal interviews. Using the internet eliminates most of the postage, phone, interviewer, and data-handling costs associated with the other approaches. Moreover, sample size and location have little impact on costs. Once the questionnaire is set up, there’s little difference in cost between 10 respondents and 10,000 respondents on the internet or between local or globally distant respondents.

Its low cost puts online research well within the reach of almost any business, large or small. In fact, with the internet, what was once the domain of research experts is now available to almost any would-be researcher. Even smaller, less sophisticated researchers can use online survey services such as Snap Surveys (www.snapsurveys.com) and SurveyMonkey (www.surveymonkey.com) to create, publish, and distribute their own custom online or mobile surveys in minutes.

Internet-based surveys also tend to be more interactive and engaging, easier to complete, and less intrusive than traditional phone or mail surveys. As a result, they usually garner higher response rates. The internet is an excellent medium for reaching the hard-to-reach consumer—for example, the often-elusive teen, single, affluent, and well-educated audiences. It’s also good for reaching people who lead busy lives, from working mothers to on-the-go executives. Such people are well represented online, and they can respond in their own space and at their own convenience.

Just as marketing researchers have rushed to use the internet for quantitative surveys and data collection, they are now also adopting qualitative internet-based research approaches, such as online focus groups, blogs, and social networks. The internet can provide a fast, low-cost way to gain qualitative customer insights.

A primary qualitative internet-based research approach is online focus groups. For example, online research firm FocusVision offers its InterVu service, which harnesses the power of the internet to conduct focus groups with participants at remote locations, anywhere in the world, at any time. Using their own webcams, InterVu participants can log on to focus sessions from their homes or offices and see, hear, and react to each other in real-time, face-to-face discussions.16 Such focus groups can be conducted in any language and viewed with simultaneous translation. They work well for bringing together people from different parts of the country or world at low cost. Researchers can view the sessions in real time from just about anywhere, eliminating travel, lodging, and facility costs. Finally, although online focus groups require some advance scheduling, results are almost immediate.

Although growing rapidly, both quantitative and qualitative internet-based research have some drawbacks. One major problem is controlling who’s in the online sample. Without seeing respondents, it’s difficult to know who they really are. To overcome such sample and context problems, many online research firms use opt-in communities and respondent panels.

Alternatively, many companies have now developed their own “insight communities” from which they obtain customer feedback and insights. For example, NASCAR has built an online community of 12,000 core fans called the NASCAR Fan Council from which it obtains quick and relevant feedback from fans. Similarly, women’s magazine Allure formed its own insight community—called Beauty Enthusiasts, now 35,000 members strong—from which it solicits feedback both on its own content and on advertisers’ brands. When Beauty Enthusiast members first join the community, they provide detailed information about their demographics, product needs, and preferences. Brands can then interact online with specific segments of the Beauty Enthusiasts community about brand perceptions, product ideas, beauty trends, and marketing moves. Says one analyst, “The feedback combines the precision of quantitative research with the qualitative results of focus groups, as people write their reactions to products in their own words.”17

Thus, in recent years, the internet has become an important tool for conducting research and developing customer insights. But today’s marketing researchers are going even further—well beyond online surveys, focus groups, and online communities. Increasingly, they are listening to and watching consumers by actively mining the rich veins of unsolicited, unstructured, “bottom-up” customer information already coursing around the internet. Whereas traditional marketing research provides more logical consumer responses to structured and intrusive research questions, online listening provides the passion and spontaneity of unsolicited consumer opinions.

Tracking consumers online might be as simple as scanning customer reviews and comments on the company’s brand site or on shopping sites such as Amazon.com or BestBuy.com. Or it might mean using sophisticated online-analysis tools to deeply analyze the mountains of consumer brand-related comments and messages found in blogs or on social media sites. Listening to and engaging customers online can provide valuable insights into what consumers are saying or feeling about a brand. It can also provide opportunities for building positive brand experiences and relationships. Many companies now excel at listening online and responding quickly and appropriately. As noted previously, more and more companies are setting up social media command centers with which they scour the digital environment and analyze brand-related comments and conversations to gain marketing insights.

Information about what consumers do while trolling the vast digital expanse—what searches they make, the online and mobile sites they visit, how they shop, and what they buy—is pure gold to marketers. And today’s marketers are busy mining that gold. Then, in a practice called behavioral targeting, marketers use the online data to target ads and offers to specific consumers. For example, if you place an Apple iPad in your Amazon.com shopping cart but don’t buy it, you might expect to see some ads for that very type of tablet the next time you visit your favorite ESPN site to catch up on the latest sports scores.

The newest wave of web analytics and targeting takes online eavesdropping even ­further—from behavioral targeting to social targeting. Whereas behavioral targeting tracks consumer movements across online sites, social targeting also mines individual online social connections and conversations from social networking sites. Research shows that consumers shop a lot like their friends and are much more likely to respond to ads from brands friends use. So, instead of just having a Zappos.com ad for running shoes pop up because you’ve recently searched online for running shoes (behavioral targeting), an ad for a specific pair of running shoes pops up because a friend that you’re connected to via Twitter just bought those shoes from Zappos.com last week (social targeting).

Online listening, behavioral targeting, and social targeting can help marketers to harness the massive amounts of consumer information swirling around the internet. However, as marketers get more adept at trolling blogs, social networks, and other internet and mobile domains, many critics worry about consumer privacy. At what point does sophisticated online research cross the line into consumer stalking? Proponents claim that behavioral and social targeting benefit more than abuse consumers by feeding back ads and products that are more relevant to their interests. But to many consumers and public advocates, following consumers online and stalking them with ads feels more than just a little creepy.

Regulators and others are stepping in. The Federal Trade Commission (FTC) has recommended the creation of a “Do Not Track” system (the online equivalent to the “Do Not Call” registry)—which would let people opt out of having their actions monitored online. However, progress has been mixed. Meanwhile, many major internet browsers and social media have heeded the concerns by adding extended privacy features to their services.18

The questionnaire is by far the most common instrument, whether administered in person, by phone, by email, or online. Questionnaires are very flexible—there are many ways to ask questions. Closed-ended questions include all the possible answers, and subjects make choices among them. Examples include multiple-choice questions and scale questions. Open-ended questions allow respondents to answer in their own words. In a survey of airline users, Southwest Airlines might simply ask, “What is your opinion of Southwest Airlines?” Or it might ask people to complete a sentence: “When I choose an airline, the most important consideration is . . . ” These and other kinds of open-ended questions often reveal more than closed-ended questions because they do not limit respondents’ answers.

Open-ended questions are especially useful in exploratory research, when the researcher is trying to find out what people think but is not measuring how many people think in a certain way. Closed-ended questions, on the other hand, provide answers that are easier to interpret and tabulate.

Researchers should also use care in the wording and ordering of questions. They should use simple, direct, and unbiased wording. Questions should be arranged in a logical order. The first question should create interest if possible, and difficult or personal questions should be asked last so that respondents do not become defensive.

Although questionnaires are the most common research instrument, researchers also use mechanical instruments to monitor consumer behavior. For example, Nielsen Media Research attaches people meters to television sets in selected homes to record who watches which programs. Retailers use checkout scanners to record shoppers’ purchases. Other marketers use mobile phone GPS technologies to track consumer movements in and near their stores.

Still other researchers apply neuromarketing, using EEG and MRI technologies to track brain electrical activity to learn how consumers feel and respond. Neuromarketing measures, often combined with biometric measures (such as heart rates, respiration rates, sweat levels, and facial and eye movements), can provide companies with insights into what turns consumers on and off regarding their brands and marketing. For example, research firm Nielsen and the Ad Council used neuromarketing to improve the effectiveness of an ad for the Shelter Pet Project, a public service campaign focused on increasing adoption rates for pets in shelters:19

Using neuroscience methods, Nielsen charted how people’s brains responded to an existing Shelter Pet Project public service ad and the ad’s canine star, Jules the dog. Researchers used a combination of EEG and eye-tracking measurements to determine the second-by-second, scene-by-scene impact of the ad on viewer attention, emotional engagement, and memory activation. They discovered that viewer attention and emotional engagement jumped when Jules was on the screen. They also learned that the end of the ad caused confusion, with Jules, the logo, and the website URL all competing for viewer attention. The creative team re-edited the ad, increasing Jules’s onscreen moments and sharpening the ad’s ending and call to action. A second round of neuroscience tests showed that the recrafted ad held viewers’ attention better, kept them more consistently engaged, and improved ad recall. As a result, in the first three months after the launch of the refreshed ad, traffic to the Shelter Pet Project website more than doubled, a change that may have real life-or-death implications for shelter pets.

Although neuromarketing techniques can measure consumer involvement and emotional responses second by second, such brain responses can be difficult to interpret. Thus, neuromarketing is usually used in combination with other research approaches to gain a more complete picture of what goes on inside consumers’ heads.