Comducting Start-up Market Research Flashcards
Marketing definition
The process of anticipating and satisfying customers’ wants in a way that delights the customer and also meets the needs of the organisation.
Purposes of market research
Descriptive, explanatory, predictive and exploratory reasons.
Descriptive reasons of market research
Has the firm achieved targets
Are sales rising or falling
How are firms sales performing relative to a competition
Explanatory reasons of market research
What external factors affect demand
What are the main reasons why customers buy the product
Why was a promotional campaign unsuccessful
Predictive reasons of market research
Calculating the extent to which advertising influences sales volume
If introducing a new flavour affects the sales of existing flavours
Predicting if a new price will boost sales revenue
Exploratory reasons of market research
Probable level of demand
Most suitable market segments to be targeted
Ideal price level
Best ways of promoting the product
Types of market research
How the data is collected-(primary/secondary)
The content if the data-(quantitative/qualitative)
Primary market research
The collection of information first-hand for a specific purpose.
Secondary market research
The use of information that has already been collected for a different purpose.
Types of primary market research
Experiments Observation Focus group Surveys Personal interviews Postal surveys Telephone interviews Internet surveys Test marketing
Experiments + -
Relatively cheap
May delay intro of a potentially successful strategy
Observation + -
May show what customers are thinking
Expensive to employ psychologists to analyse the results
Focus group + -
Able to gather in-depth details of customers’ thoughts
May be bias
Personal interviews + -
Wide range of info can be gained
Can be time consuming
Postal surveys + -
Cheap
Response rates low
Telephone interviews + -
Calls are cheap
Questions tend to be brief
Internet surveys
Surveys can be updated frequently
Be biased towards people with a particular interest in the product or service
Test marketing + -
Relatively accurate predictor of future popularity
Can lead to rivals copying product before actual launch
Key sources of secondary market research
Government publications Newspapers Company records Magazines Competitors Market research organisations Loyalty cards Internet
Benefits of secondary market research
Information is already available
Cheaper than primary research
Secondary surveys are often conducted regularly so helpful to identify trends over time
Drawbacks of secondary market research
Info may be dated therefore misleading
Available to everyone so no competitive advantage
May be no relevant secondary data
May be unreliable and inaccurate
Qualitative market research definition
The collection of the info about the market based on subjective factors such as opinions and reasons.
Quantitive market research definition
The collection of the information about the market based on numbers.
Qualitative market research + -
Helps a firm to understand its customers
Can give ideas that the firm had not previously considered
Expensive to gather
Possibly biased
Difficult to collate
Quantitative market research + -
Summarises data concisely
Easier to compare results to other organisations
Help to identify changes and trends
Only shows ‘what’ rather than ‘why’
Can lack reliability and validity if sample size is small
Sample definition
A group of respondents or factors whose views or behaviour should be representative of the target market as a whole.
Random sample definition
A group of respondents in which each member of the target population has an equal chance of being chosen
General problems of sampling
Sample may be unrepresentative
May be bias in questions
May be difficult to locate suitable respondents
Factors influencing choice of sampling method
Costs and availability of finance
Time
Importance of market segments/sections
Is the business targeting a specific group of customers
The firm’s understanding of its customer base
Market research definition
The systematic and objective collection, analysis and evaluation of information that is intended to assist the marketing process
