Bank ABC collects various information about its customers when they join the ban

Question

Bank ABC collects various information about its customers when they join the bank (including their names, residential post code, telephone), as well as their banking and transaction history once they start using bank’s services. Bank A also conducts a satisfaction survey of its customers annually, which is carried out by an external market research agency:

• Identify the type of data that the bank collects in each case(primary or secondary)

• Describe the difference between the two types of data and their use in market and social research

Explanation / Answer

Primary data is the data that is collected by the investigator himself, and secondary data is the data which is collected by someone else, but used by the investigator for his purpose. Hence, in this case, the data collected by the ABC bank like the customer’s names, residential post codes, telephones, ,banking and transaction history, etc. whereas in this case the satisfaction survey data, collected by the external market research agency for the bank ABC is secondary data.

The primary data is the data that is collected by the researcher himself, hence the accuracy as per the researcher needs, and purpose of primary data is more but collection of primary data is often expensive and is a big task for the researcher to collect the data. Whereas secondary data is collected by a third party for the investigator, hence there might be discrepancies in data collected when researcher‘s needs and purpose of using the data are considered. But secondary data collection is much less cumbersome and expensive for the investigator.

In market and social research the secondary data considered is mostly from the studies already performed by government agencies, trade associations, and other organizations. This data is free and easily available for the investigating organization, but is not tailored to its needs, hence, properly analysing secondary data in social and market research is the actual task for the organization. Hence secondary data is used first to establish broad market needs and requirements, or social changes that are happening, etc.

Whereas, the primary data collection for market or social research is done by the organization itself, in form of surveys, focus groups, interviews, field testing, observations, etc. this data collection is far more cumbersome and expensive but gives precise information to the company. For example, customer’s inclination towards a particular product, feedback, etc. Hence primary data can be used to gauge customer’s interest in the brand, their feedback of the products, expected services and demand, customer’s willingness to pay for a product, etc.

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