Quantitative and Qualitative Research: Financial Implications of Chosen Methodology

This is the first of two eTips! examining the financial implications of various research designs. February's issue will focus on methods of reducing the costs of marketing research.

As budgets are revisited for this year's objectives, market research professionals invariably keep the financial constraints in close view when developing project objectives and methodologies. Here we examine both perceived and actual costs of qualitative and quantitative approaches against their value to the decision-making process. As a result, a basic but practical framework emerges to aid the overall decision-making process.

Qualitative: When reviewing total dollars spent, qualitative research appears to be less expensive than quantitative alternatives. On the other hand, when reviewing the cost per interview (CPI), qualitative methods are more expensive, due to things like:

• Facility rental
• Higher honoraria costs
• Moderator fees
• Travel expenses

Qualitative research's unique value is that it allows for more in-depth exploration of profiles, concepts, promotional materials, etc. at a relatively lower overall cost to the project.

Quantitative: While the CPI is less, the overall project costs for quantitative projects are usually higher as a result of any combination of the following:

• Higher number of total participants
• More extensive analysis and data interpretation
• Large number of open-end questions
• Higher number of survey questions
• Higher number of research objectives
• Lower incidence or participant qualification

Quantitative research's unique value is that it provides information that can be projected across an entire population and can help determine, confirm or support strategic initiatives in a cost-effective format.

In conclusion, the ultimate measure of value is based not on the total dollars spent for a research program, but on the utility of the results in supporting informed marketing and strategic decisions. Appropriately designed and executed marketing research more than justifies its cost with its value.