Market Research(1.1.2) Flashcards
What is market research?
the process of determining the viability of a new service or product through research
What is product orientation?
the product and its characteristics are the focus rather than the customers
therefore high quality
What is market orientation?
customers needs and wants are the focus
therefore the product is updated to continuously meet wants and needs
What is a asset led market?
does both product and market orientation
What is market research used for?
quantify the demand for a product
provide and insight into consumer behaviour
identify potential price ranges for the products
gauge potential strengths and weaknesses of competitors
What is primary research?
data that has never been collected before
Eight methods of primary reseach
questionnaires
postal surveys
telephone interviews
personal interviews
focus groups
observation
test marketing
social media
Advantages of primary research
business is able to tailor research to exactly what they want to know
information is available exclusively to that business and their competitors cant access it
can help businesses to understand customer psychology and get in depth understanding of their clientele(consumer behaviour)
Disadvantages of primary reseach
can be very expensive-external agencies may have to be hired and can cost thousands for high quality in depth information-can be time consuming and take away attention form other things
bias can sway researcher guiding them to answer in particular way-respondents may not provide true information-inaccuracy-research may not be reflective especially is a small sample size is used e.g. 5 person focus group-unreliable
What is secondary research?
research that already exists
What is internal data?
facts and information that come directly from the company’s systems and are specific to the company in question
Three internal data examples
market research reports e.g. past advertising campaigns
sales figures e.g. invoices
customer preferances e.g. known complimentary products
annual reports e.g. wider department data
What is external data?
data that is generated outside an organization
Two external data examples
market research reports e.g. MINTEL
government publications e.g. housing income
Secondary research disadvantages
information may be out of date or irrelevant-may have been gathered for other purposes-may be factually incorrect.
bias-no way to tell-research methods and researchers can be unknown
some market reports can be very expensive to buy
Secondary research advantages
can be cheap or free e.g. government websites
quick and easy to collect
can use data to spot trends and changes
can be checked across multiple sources for reliability
What is qualitative research?
provides insight to attitudes feelings and behaviours
e.g. focus groups, interviews
What is quantitative research?
provides numerical data that can be statistically analysed
e.g. sales figures, market share
What are three limitations to market research?
sample size being too small
sample bias
human behaviour
What are four extra limitations of market research?
budgetary constraints
time constraints
reliability of data
legal and ethical constraints
What is market segmentation?
the means of discovering useful ways to split up a market into different groups of consumers who share similar characteristics wants and needs
segment-target-position
Four ways to segment the market
geographical
demographical
psychographic
behavioural
What is geographical segmentation?
different customer groups will likely have different needs depending on where they live
What is demographical segmentation?
age, gender, income, social class, religion, ethnicity
What is psychographic segmentation?
groups customers according to their attitudes opinions and lifestyles
What is behavioural segmentation?
grouping customers based on actions and behaviour
Advantages of market segmentation
identify gaps in the market-products and services can be designed to suit specific customers
the firms can meet needs more precisely
promotional and marketing activities are easier to target groups of customer and refine the promotional ideas
Disadvantages of market segmentation
high costs concerning research and development and marketing#(also market research)
product range increasing or becoming more specialised could lead to higher costs per unit(production) and even diseconomies of scale
difficult to identify segments
consumers may belong to multiple segments
consumers may not behave the same(within the segment)
segment could be too small and unprofitable
Three ways ICT supports market research
company website
databases
social networking
How does company websites support market researching?
collect primary data cheaper e.g. tracking consumers searches and reviews, pop ups are alseo effective
aquiresd secondary data about rivals e.g. prices and special offers
How does databases support market researching?
loyalty cards e.g. Tesco Clubcard, Lidl plus
customer email address e.g. send offers, vouchers, savings
How does social networking support market researching?
Instagram, Facebook, Twitter, Tiktok
it is also useful as a method of running quick polls and surveys or tacking opinions about brands
