1.1 meeting customer needs (booklet 2) Flashcards
product orientation
business develops products based on what it is good at making or doing, rather than what the customer wants
market orientation
businesses respond to customers needs and wants
purpose of market research
- clarify specific needs and wants of customers
- provide insight into consumer behaviour
- find out demand for a product
market research
process of collecting and analysing data based on marketing and consumption of goods and services
secondary research, desk research
data which exists collected for another purpose, e.g internal data ,business documents, external data, outside business, info from competitor or government
primary research, field research
data collected first hand for specific purpose, e.g questionnaires, postal surveys, focus groups, test marketing
positives of secondary research
- free and easy to obtain
- quick to access
negatives of secondary research
- quickly becomes out of date
- specialist reports expensive
- may not be representative of customers views
positives or primary research
- results kept private
- In depth views from customers
- data collected directly from business customers
negatives of primary research
- time consuming, expensive
- difficult to collect big enough sample for data to be useful
quantitative data
collection of statistical data such as sales figures
qualitative data
collection of reasons, attitudes and beliefs of consumers from a focus group
positives of qualitative data
- detailed reasoning helps with decision making
- understands customers needs in detail
- can identify why sales may be declining
negatives of qualitative data
- time consuming, expensive
- based on opinions which can be unreliable
- sample size may not be representative of the market
positives of quantitative data
- quick and easy to analyse
- numerical data provides insights to trends
- easy to compare with past or competitors data
negatives of quantitative data
- no reason behind answers given
- no reason behind trends identified
- data only reliable if sample size is representative of market
limitations of market research
- respondent may be bias
- past data and trends may not be a fair indication into future
- questionnaires may have leading questions, bias
- sample size too small compared to target market
use of databases to support market research
-data mining, extracting data from larger sets of data
use of company websites to support market research
- cookies
- online polls and surveys
- frequency and timings of visitors
use of social networking to support market research
- likes/dislikes
- viral marketing
- customer feedback
what is psychographic segmentation
where people are grouped based on attitudes, opinions and lifestyles
what is behavioural segmentation
people grouped based on how often purchases are made, loyalty cards encourage loyalty
what is demographic segmentation
people grouped based on age, gender, income , social class, ethnicity, religion
what is geographic segmentation
people grouped on where they live
benefits of market segmentation
- least and most profitable customers identified
- helps firm improve existing products and customer services
- advertising can be targeted at specific market segments
- greater added value, premium prices
limitation of market segmentation
- greater market research
- production costs
- different additions need to be added to different segment groups
