Deductive and Inductive Market Research

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Market research is grounded in logic, with two logical approaches as the basic components of reasoning and strategy. These approaches are known as deduction and induction.

Deductive Research

Deductive reasoning is a top-down approach that drills inward from the general to the specific. In empirical research, this means a market researcher begins a study by considering theories that have been developed in conjunction with a topic of interest.

This approach lets a market researcher think about research that has already been conducted and develop an idea about extending or amending that theoretical foundation.

A new hypothesis will be tested by the market researcher in the process of conducting their study, and new data will be collected, documented, and analyzed. The researcher will conclude their findings in the context of their hypothesis, and detail their methodology for others to study, emulate, or test. It's important to note that unconfirmed hypotheses are not the same as those that have been proven false.

Deductive Research Steps

  • General query of literature theories
  • Define topic of interest
  • Theory-related Idea
  • Hypothesis
  • Data collection
  • Data analysis and hypothesis testing
  • Confirmation (or otherwise) of the hypothesis
  • Dissemination of the findings

Inductive Research

Inductive reasoning is a bottom-up approach that moves from the specific to the general. In this case, the term specifically refers to an observation made by the market researcher that eventually leads to a broad generalization and theory.

Just as in a deductive approach, inductive methodology begins with an observation made by the market researcher, who begins their study with a specific topic of interest. In the inductive approach, however, the researcher does not consider related theories until much further along. During the analysis of their new data, and using the patterns observed, the market researcher suggests themes for further study .

Inductive Research Steps

  • Specific observations and measurements
  • Topic of interest emerges
  • Data collection
  • Data clusters or patterns
  • Data analysis
  • Emergence of themes
  • Generalizations
  • Dissemination of findings

Quantitative Research and the Hypothesis

When a market researcher is conducting quantitative research, existing theories can be considered and analyzed comparatively with the tested hypothesis. When a market researcher is conducting qualitative research, no formal hypothesis testing takes place; however, the market researcher may form generalizations based on the strength of the data and themes that have emerged.

Data collection and data analysis in qualitative research are iterative. Data collection doesn't happen all at once, and analysis begins at the discretion of the researcher. When sufficient data clusters or patterns emerge, the market researcher can decide that the data collection should slow, stop, or change direction.

Data collection and data analysis in quantitative research happen at distinct, and non-discretionary stages. To mingle data collection and data analysis in the manner of qualitative research would compromise the integrity of the test, as a lack of boundaries contaminates the testing process. Findings from this kind of research cannot be considered robust by the scientific community as the test cannot be precisely replicated.

Mixed Methods

Bottom-up research methods feel more unstructured, but they are no less scientific than structured top-down methods. Every type of research approach has its own advantages and disadvantages, and it's not uncommon for a study to employ mixed methods.

A market researcher who chooses a mixed-method approach applies deductive research to the components of the study that show strong theoretical ties. Alternately, an inductive research approach is applied to the components of the study that seem to require a more exploratory inquiry.

It's inaccurate to think of deductive and inductive approaches as two sides of the same coin. In practice, they are two ends of a continuum. Deductive research is associated with linearity and a search for causal relationships. Inductive research is associated with depth of inquiry and descriptions about phenomena. Mixed methods can be placed at about mid-point on that continuum, with an emphasis on research breadth.