4.4 Market research Flashcards
Market research
Process of collecting, recording and analysing data about customers, competitors and the market
Why do organisations carry out market research?
To reduce the risks associated with new product launches
To predict future demand changes
To explain patterns in sales of existing products and market trends
To assess the most favoured designs, flavours, styles, promotions and packages for a product
What can market research find out?
Whether consumers will buy a product
Reaction to different price levels
Reaction to alternative forms of promotion
Reaction to new types of packaging
Reaction to different methods of distribution
Primary research
The collection of first hand data that are directly related to a firm’s needs
Secondary research
Collection of data from second hand sources
Qualitative research
Research into the in depth motivations behind consumer buying behaviour or opinions
Quantitative research
Research that leads to numerical results that can be presented and analysed
Survey
Detailed study of a market or geographical area to gather data on attitudes, impressions, opinions and satisfaction leaves of products or businesses, by asking a section of the population
Open questions
Those that invite a wide ranging or imaginative response
Closed questions
Questions to which a limited number of preset answers is offered
Types of primary research methods
Surveys
Interviews
Focus groups
Observations
Test marketing
Test marketing
Marketing a new product in a geographical region before a full scale launch
Focus groups
A group of people who are asked about their attitude towards a product, service, advertisement or new style of packaging
Advantages of primary research
Up to date
More relevant/direct
Confidential and unique
Objective
Disadvantages of primary research
Time consuming
Costly
Questionable validity
From where can secondary research be taken from?
Market intelligence analysis reports
Academic journals
Government publications
Local libraries and local government offices
Trade organisations
Media reports and specialist publications
Internal company records
The internet
Advantages of secondary research
Cheaper and faster
Range of sources
Insight to trends
Disadvantages of secondary research
May become obsolete or out of date quickly
May be in an inappropriate format
Partial information
Widely available to competitors
Types of sample size and sampling methods
Quota sampling
Random sampling
Stratified sampling
Cluster sampling
Snowball sampling
Convenience sampling
Quota sampling
Gathering data from a group chosen out of a specific sub-group
Random sampling
Every member of the target population has an equal chance of being selected
Stratified sampling
This draws a sample from a specified sub-group or segment of the population and uses random sampling to select an appropriate number from each stratum
Cluster sampling
Using one or a number of specific groups to draw sample from and not selecting from the whole population
Snowball sampling
Using existing members of a sample study group to recruit further participants through their acquaintances
Convenience sampling
Drawing representative selection of people because of the ease of their volunteering or selecting people because of their availability or easy access
