It is unlikely that secondary data will be sufficient to answer all the questions you will have related to your business. Secondary data is useful for helping to determine the scope of the issue(s), the type of questions that need to be addressed, and can help to determine what other information might be necessary. In essence, it can help you to determine what other types of primary information you need.
Primary research is concerned with creating data that does not yet exist. This data is specific to the industry, business, product and/or service, or consumer you are interested in. Only data that is central to the issue(s) or questions at hand is collected so no extraneous data needs to be analyzed or interpreted.
Since this type of data is collected by you, it is more:
- Reliable
- Objective
- Current.
It can be collected in practically any situation to help clarify an issue, answer a question, or address a problem.
Methods for collecting primary data vary based on the goals of the research and the type and depth of information being sought. When collecting primary data, it generally falls into two categories: quantitative and qualitative. Each method involves different processes of collection, and each can reveal different information. Therefore, it is best to collect both types to gain a full understanding of your industry, target market, and consumer preferences.
Unlike secondary data, primary data takes time and money to collect, and its analysis and interpretation can be costly in both time and money. Going out and manually collecting data or paying a research company to do it for you can be very expensive.
Advantages of Primary Data
- Specificity – the data is collected for the exact purpose of addressing an issue or question thus providing more detail and insight.
- Control – all aspects of the collection process are determined by the researcher such as design, method, and duration.
- Recency – the data is usually up to date because it is collected in real-time exactly when it is needed.
- Proprietary rights – the data belongs to the individual or company that collected it and that entity can chose to keep the data private or it can release the data to the public domain.
- Accuracy – the data is based on first-hand sources so there is little chance it can be altered, taken out of context, or misrepresented.
- Definitions/Terminology – the definition of terms is in the control of the individual or company conducting the research so there is no discrepancy in meaning across studies.
Disadvantages of Primary Data
- Cost – the data can be expensive to collect and may require external agencies to collect it.
- Time – it takes time to design the collection process and may take days, weeks, months, or years to collect the data.
- Reach – the data may only be specific to a location or group and may not be representative for different locations or groups.
- Scope – the data may only deal with a very narrowly defined issue or question reducing its usefulness in other areas.