1.1.2 Market Research Flashcards
What is Product Orientation?
An inward looking approach to new product development where the key focus is on what products can be made and the production process
What is Market Orientation?
An outward looking approach to new product development where the key focus is on what products the consumer wants
What is Market Research?
The collection and analysis of data and information to inform a business about its market.
What does effective market research do?
- Reduces risk
- Finds out what consumers need and want
- Businesses can predict how much demand there will be for its products
- Understand consumer behaviour
- Work out how much consumers would be prepared to pay for a product
- Identify current / potential customers
What is Quantitative Research?
The gathering of statistical data to inform the company about people’s behaviour but does not identify the reasons.
What are the advantages of quantitative research?
- Easier to gather than qualitative
- Quicker to gather than qualitative
- Faster to analyse
- Examine larger samples
- -> averages - Easier to make decisions from quantitative data
What are the disadvantages of quantitative research?
- Tends to have narrow/closed questions
–> E.G. Who/What/When
Not Why? How? - Unhelpful if you want to understand the issue in depth
What is Qualitative Research?
The gathering of non-statistical information that gives a company an in-depth insight into the reasons for human behaviour.
What are the advantages of qualitative research?
- Creates in depth data to help understand the issue in depth
- -> With the How? and Why?
What are the disadvantages of using qualitative research?
- Slower to gather than quantitative research
- More difficult to analyse data
- Harder to make business decisions from qualitative data
what is Primary Market Research?
When a business gathers new data either themselves or they employ someone to do it on their behalf.
What are the methods of primary market research?
- Questionnaires —-
|—> These ask lots of questions and can be done via post, in person, internet etc - Surveys —————
- Observations –> Consumers are watched in a normal shopping environment to get an insight into
their behaviour - Interviews –> Usually done one-on-one with a researcher
- Focus groups –> Where a group of around 8 people discuss their opinions e.g. about a product
- Test marketing –> Launch a product in one region and measure sales and customer response
before launching it across the country - Sampling –> Used to make predictions about the whole market based on a sample
What are the advantages of primary market research?
- Data is up to date and current
- The data is more reliable
- The data is specific to the purpose its needed for
- -> This is great for niche markets
What are the disadvantages of primary market research?
- It is time consuming
- Expensive
- Its Labour intensive
What is Secondary Market Research?
When a business conducts market research using data that already exists and is already available.
What are the methods of secondary market research?
- Government publications
- Market reports
- Internet sources
What are the advantages of secondary market research?
- Easier to get hold of information
- Short research time
- Low cost
What are the disadvantages of secondary market research?
- Data would most likely be out of date
2. Not necessarily specific for the purpose of the reseach
What is primary and secondary market research data used for?
- Identify and anticipate customer needs and wants
- Quantity likely demand
- Gain insight into consumer behaviour
What type of market research should a small business use?
A small business should use primary market research (despite costs) to get a ‘competitive edge’
What is Bias (in Market research)?
When research findings cannot be trusted because of the way the research has been carried out
Why use technology to collect market research?
Using technology makes market research easier, cheaper and quicker. It can be used to get a lot more information than traditional research methods and it’s easier to reach a wider sample of consumers.
What are examples of ICT (Information and Communication Technology) businesses can use?
- Websites
- Social network
- Databases
What is Market Segmentation?
Dividing a market into identifiable segments in which reflects different consumers needs and wants.
What are the main categories of market segment?
- Demographic Segments
- -> Age
- -> Gender
- -> Socio-economic class - Geographic Segments
–> Market can be divided up according to neighbourhood, city, county, country, world region
–> It’s a method used mostly by multinational companies as their customers have a range of
cultures, lifestyles and climates and are likely to need different marketing mixes. - Income Segments
- Behavioural Segments
- -> Amount of use
- -> Lifestyle
- -> Hobbies and interests
