You Ask, I Answer: Primary Research vs. Secondary Data?

In today's episode, Eric asks, under what circumstances would you support primary research versus using imperfect secondary data? Uh I generally suggest primary research when you can, when you have the budget and the time and the resources to do so, because primary research, primary sources of data is data you own, right? And you have the opportunity to do it your way to ask the exact questions you want to have asked in the way you want to have, ask them uh to the people that matter the most to you. Now, a lot of the time that means that the data that you collect may be uh not necessarily suitable for others. It may be something that is uh only helpful to your company, but it's the best data there is.

Um generally speaking, the whether you choose to use uh primary data or secondary data depends on risk, right? Uh what is the risk if you get it wrong? If you are uh trying to figure out, for example, how to make more engaging tweets, right? This is not a high risk technique, right? So you if the data you're working with is imperfect secondary data and the risk is low, like okay, maybe I use the wrong emoji in these tweets, that's fine, right?

There's if you get it wrong, there the consequences are very, very small. If you are trying to say, oh, I don't know, buy a company that's worth a billion dollars, um, that seems to me the kind of thing you want to invest more in making sure you get it right. You know, the the general rule of thumb is 10% of anything you spend should be on the measurement of that thing so that you know what you're doing, right? So if you're spending no time and no money on Twitter and just kind of tweeting randomly, yeah, your your investment in research and data and analytics should be of 10% of that nothing as well, because it doesn't matter. If, on the other hand, uh, you know, you've got a billion dollars, well, then you know, 10 million of those dollars, uh, no, a hundred million of those dollars are at are should be earmarked towards making sure you're going to make the right decision.

And if you can't earmark that that amount of money, um, there's a good chance that things are going to go off the rails. There's a good chance that things will not go as you expect them to. Again, primary research is when well done, when properly done, is the best thing to have. And that raises the other question is uh capacity, capability. Primary research done by people who are not market researchers tends not to be very good quality.

Um, you know, real simple example. Imagine sending out a survey to consumers about your company or your smoke shifter company. You know, it's uh you ask the question uh what's your opinion of left-handed smoke shifters incorporated? We're you know great, really great or awesome. Of course, that research is flawed, right?

That that was put together by somebody who doesn't know what they're doing when it comes to market research. So if you don't have the skills to do primary research well, then imperfect secondary data that's still better quality than what you'd produce is the better choice. You always want to go with the best quality possible with data, right? It's kind of like uh clean water. Um given a choice of different types of uh water to drink, you generally opt for the cleanest water you can, right?

You don't generally willingly opt for dirtier water than it has to be. Uh, and the same is true of your data. Um so risk matters, um skills and capabilities matter, and then application matters. Kind of those are the three big factors I would use to make that decision. And always opt for the best quality data that you can, given this whatever circumstances you find yourself in.

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