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Study Explores Market Research Functions' Uses, Attitudes Toward Primary and Secondary Research
| Source: Cutting Edge Information
RESEARCH TRIANGLE PARK, NC--(Marketwire - June 10, 2008) - The average pharmaceutical
company spends 59% of its market research budget to conduct primary
research, according to "Developing Integrated Market Research Functions:
Decision Support for 2008," a study by Cutting Edge Information
(http://www.PharmaMarketResearch.com). Secondary research accounts for the
remaining 41%. The report examines the benefits and drawbacks for either
type of research. It also reveals companies' attitudes and uses for each.
Although the average shows that companies invest relatively similar amounts
for primary research and secondary research, disparity occurs at the
individual company level. For example, one company surveyed spends 95% of
its market research budget on primary research, whereas another invests 75%
of its market research budget on secondary research.
"Our data show that pharma companies not only have different research
needs, but that they have diverse attitudes toward different types of
research. Nonetheless, the most efficient companies carefully evaluate
their research needs and plan accordingly," said Elio Evangelista, lead
author of the report. "They use a variety of tools and achieve the right
mix of primary and secondary data."
Several factors influence companies' decisions to use one type of research
or the other. Cost is key: primary research is usually more expensive to
collect than secondary research. CEI analysts also find that a product's
lifecycle stage plays a role: most companies reduce spending on primary
research once their products' growth slows down, as it makes less sense for
companies to invest in primary market research because most aging brands
will not be repositioned. Another concern that one company executive
raised is objectivity: his company finds that secondary sources such as
journals may be more objective than surveys or interviews, which can be
subtly biased.
"Developing Integrated Market Research Functions: Decision Support for
2008," available at http://www.PharmaMarketResearch.com, is an extensive
guide outlining surveyed companies' market research structures, budgets,
staffing and outsourcing metrics. The report also includes best practices
and strategies for elevating the market intelligence function to a
stronger, more strategic decision support organization.
To download a free summary of this 173-page report, visit
http://www.cuttingedgeinfo.com/pharmamarketresearch/index.htm#body.