Market research vs. customer development: Where are the differences?

The goal of market research is to identify customer needs in order to improve products and services. It is therefore not surprising that market research methods are now part of day-to-day business in many companies.

But customer development also puts the focus on the needs of the customer. So what is the difference between general market research and customer development? What are the advantages of customer development in comparison to market research?

Market Research or Customer Development: an overview

Table of Contents

Market research: starting point for strategic decisions

Market research employs scientifically recognized methods to collect and evaluate data. In the process, very different market conditions are put to the test. In this way, market research provides important insights:

  • What is the current situation on the procurement and sales markets?
  • What’s going well?
  • Where is optimization potential in my own company?


The aim of market research is to gain insights into the company’s own products, target groups and competitors. On this basis, management can then make well-founded strategic decisions. After all, sound marketing and product decisions can only be made if decision-makers know what the market looks like.

From trends to evaluation: the range of tasks in market research

Market research performs various tasks for a company. Since a well-conducted market analysis provides valuable information, there are external service providers who specialize in market research. But it is also possible without these service providers: many companies decide to handle market research in-house.

So what exactly is the added value of market research? On the one hand, it serves to identify current trends and developments at an early stage and to adapt the company’s own business activities accordingly. A market analysis provides impulses for marketing measures and product decisions.

But market research also plays an important role in forecasting. If you know the current developments, you can better estimate how the market will behave in the future. Think of market research as a kind of early warning system: If the market shows trends that move away from your current company positioning, you can adjust your strategies in good time thanks to a market analysis.

In addition, market research also helps when it comes to making concrete marketing and product decisions. Systematic methods can be used to put various options to the test. That’s enough to find the version that is most popular on the market. Even if you have already made a business decision, you can use market research to measure the success or failure of this measure.

Different forms of market research in detail

The methods of market research are based on obtaining and evaluating data. Which specific measures are used to collect the data depends on the form of market research. A distinction is made between primary and secondary research. While primary research focuses on data that has not yet been collected, secondary research uses facts and figures that have already been collected.

On the other hand, the method of data collection is also important. This results in the division into quantitative and qualitative market research. Quantitative market research captures markets in figures and statistics. Qualitative market research takes a different approach: Here, more open survey methods are used that allow customers to have their say.

Predicting the future is easy. Getting it right is the hard part.

Primary vs. secondary market research

Primary market research is about collecting data that has not been collected before. It relates to a specific market segment and the associated target group. Surveys, observations and tests are used to generate information that is relevant to the company.

Secondary market research is different. Here, no new data is collected. Rather, this form of market research involves drawing on existing findings. This includes, for example, trend analyses, market statistics or internal company sales statistics.

To determine your company’s competitors, for example, you can use secondary research methods. Secondary market research also helps you to visualize trends and developments over time.

Quantitative market research: knowledge in numbers

Quantitative market research aims to present results in the form of numerical and statistical statements. If you have your customers fill out a questionnaire asking them to rank their satisfaction on a scale, this falls under quantitative market research.

Large, representative surveys are often used here. Their aim is to enable conclusions to be drawn about trends within the buying public. Enough statements can be made about frequencies or probabilities. Although this gives you access to a large amount of information, this form of market research does not necessarily reveal the specific needs and wishes of your customers.

Qualitative Market Research:

Qualitative market research is more relevant for customer-centric work. This is because the samples here are smaller, but are surveyed in much greater detail. Instead of standardized, closed formats, respondents here have the opportunity to give free answers.

In addition to surveys, expert and in-depth interviews are also popular methods of qualitative market research. Creative input can also be gained through so-called focus groups. Here, several participants come together in a group in which they can express themselves about a product or a marketing measure. Here you can learn a lot about the needs and wishes of your customers.

B2B market research: When business customers have their say

Market research does not only take place in the B2C context. Business-to-business market research is also essential for successful product and marketing concepts. After all, you can only maintain good business relationships if you understand your business customers.

But here’s the kicker: It’s usually much easier to conduct market research in a B2C context. Why? Because it’s much easier to reach potential users in the B2C environment.

Example: You launch a sustainable toothpaste. Everyone has to brush their teeth. Most people prefer sustainable products. So far, so good. For both quantitative and qualitative market research purposes, you have plenty of potential users at your disposal.

Things get more difficult if you have developed a new service in your business and want to know how it is received. Basically, only your customers and those who use the service are eligible for the survey. In addition, the decision-maker within your customer is a different person than the user of your customer. Side note: This is called the buying center.

The number of people who are available for market research purposes is therefore naturally much smaller. This does not make things any easier.

This is precisely the challenge that customer development also faces. After all, customer development is also about customers. So in both customer development and B2B market research, we operate in the business customer environment. That’s one thing we have in common. But there are also areas where customer development is clearly distinct from B2B market research.

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Customer Development: Understanding customers and their problems

B2B market research and customer development have some parallels: Both areas focus on business customers. Both try to gain insights with the help of qualitative methods. So what is the difference?

Pains and Gains: Put yourself in the shoes of your customers

The difference lies primarily in the attitude behind customer development. In customer development in the context of business and product ideas, needs orientation takes the place of sales orientation. In concrete terms, this means that the primary goal is not (only) profit maximization, but also customer satisfaction.

Qualitative methods help to better understand customers and their wishes. However, customer development goes one step further: it not only investigates what customers like, but also what worries and problems they have. This is the best place to start: If a product or service can solve a problem, then it is a good product or a useful service. Keyword: Problem-Solution-Fit.

Customer Discovery is damn hard work. You can't fake it.

Important tools in Customer Development

Interviews and focus groups play a central role in customer development. This is how you find out where there is already satisfaction and where there is still room for improvement. This is particularly useful during product development and the go-to-market phase. Only if you create a product or service that your customers really want, will there be nothing standing in the way of your company’s success.

But also well-known tools like the Customer Empathy Map or Buyer Personas help you to put yourself in the shoes of potential customers. And that is essential just BEFORE the development of a service or a product. Customer development works with qualitative data even before the go-to-market.

Comparison of Market Research and Customer Development

Customer development is characterized by its focus on needs. This means that the wishes and opinions of customers are also taken into account in company decisions. But with regard to market research, it differentiates itself in other aspects as well. The following table shows the differences:

Market Research vs Customer Development
Comparison: Market Research vs Customer Development

Customer development takes a narrower and more specific approach than market research. This has the advantage that your customers can more easily have their say. Nothing is more frustrating than investing a lot of time, money and effort in product development, only to discover in the end that customers don’t need the product at all.

So use customer development to work in a targeted and needs-oriented way. Such a customer-centric approach will ensure that your customers are not only satisfied, but thrilled in the end.

Tools that will help you get to know your customers better

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Customer development in contrast to classic market research

Market research is a key factor when you want to gain an overview of procurement and sales markets. Depending on the research methods used, market research gives you access to a large amount of data and allows to focus on brand awareness, brand perception and customer satisfaction.

Customer development employs qualitative methods to analyze customers and their problems in more detail and to enter into a dialogue with them. If you ask the right questions here, the findings will offer you great added value for your company. This enables you to develop exactly the products and services that your customers want.

Over time, Customer Development will also strengthen customer loyalty to your company. You will be able to make product and marketing decisions that will convince your customers in the long term!


About Me

As a founder and entrepreneur, I experience the importance of customer centricity for companies on a daily basis.

Incorporate the essential perspective of the customer into your product genesis and marketing processes. That is what puts horsepower on the road and keeps your business on track.


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