Chapter 3: Uses Of Market Research

Question 1

4 Most Common Purposes of Market Research

Answer 1

1. understanding markets
2. Understand customers
3. Understanding and developing the offer
4. Positioning the brand and communications

Question 2

2 elements comprising the term market size

Answer 2

Served available market (SAM) and Total available market (TAM)

Question 3

Importance of putting customers first

Answer 3

● Two-thirds of customers say a positive customer experience results in them spending more with the company.
● Eight out of 10 customers say that they would pay up to 25 per cent more for a superior customer service.
● Three-quarters of those who switch suppliers/brands claim that this is due to a poor customer experience and service.
● More than half of those who recommend a company do so because of the customer experience rather than other factors such as price or product.
● Almost all of those who have had a bad customer experience tell others about it, mainly to warn them or stop them buying from the supplier.

Question 4

Voice of the Customer (VOC)

Answer 4

Market research that focuses on customers

Question 5

The zone of indifference

Answer 5

The space occupied by customers who think a company or its products are acceptable (but not particularly special) and who give satisfaction scores in the moderate range of 7 or 8 out of 10, are vulnerable and could take their business elsewhere

Question 6

Customer journey

Answer 6

refers to all the occasions on which a supplier touches the customer.

Customer satisfaction can be measured at any or all of these touch points or ‘moments of truth’. The most common measures are:
● satisfaction with individual issues related to the product/service at different points on the customer journey;
● overall satisfaction score;
● likelihood to recommend score;
● ease of doing business score (most common on B2B markets).

Question 7

VOC Surveys

Answer 7

collect intelligence that can be used to group customers in different ways to see if a company’s product or services can be more closely aligned to them.

Question 8

Three types of segmentation (pp. 37 - 8)

Answer 8

1. Demographic (easiest)
2. Behavioral (moderate)
3. Needs (unmet needs; difficult)

Question 9

Key issues that need to be identified in product development research

Answer 9

● competitor products, including their price, features, distribution and market share;
● likely customer acceptance or rejection of new or modified products;
● forecast of use of products;
● threats and barriers that will inhibit the products’ success;
● optimum pricing of new products;
● reaction to packaging concepts;
● customer benefits derived from features and promotional messages.

Question 10

The purpose of brand research

Answer 10

●● identify brand perceptions, performance and uniqueness;
●● position brands competitively;
●● measure the effectiveness of brands;
●● measure the effect of brand promotions in attracting customers;
●● test brand positions and promises;
●● track brands over time.