Market research Flashcards
Purpose of market research (4)
Identify gaps in the market
Reduce risk
Identify and understand customer needs
Inform business decisions
Define:
Market-
Competition-
Market segment-
-place where consumers and producers meet to sell and purchase goods and services
-when businesses sell similar products
-how the market is divided on groups of consumers with similar habits
Market share-
Proportion of sales that in a market are taken by one business
Primary research (5)
-data collected first-hand for specific purpose
Focus groups
Surveys
Questionnaires
Interview
Observation
Secondary research (3)
-data that has already been collected for a different purpose
Internet
Government reports
Market reports
Benefits of primary research (3)
Very specific
Kept private
More detailed insights
Benefits of secondary research (3)
Free, easy to obtain
Good source of market
Quick to access and use
Drawbacks of primary research (3)
Time consuming
Risk of being biased
Sampling may not be representing the whole population
Drawbacks of secondary research (3)
Quickly become out of date
Not tailored for business purposes
Often quite expensive
Quantitive and qualitive data are -
-numerical data, various forms of surveys
-based on opinions, attitudes, beliefs (focus groups, interviews)
Qualitive data benefits (4)
- Essential for important new product development
- Focused on understanding customer wants, needs
- Highlight issues that need addressing
- Effective way of testing elements of marketing mix
Qualitive data drawbacks (3)
- Expensive to collect and analyse
- Based around opinions, do not represent population
- Require research skills
Quantitive data benefits (3)
- Data relatively easy to analyse
- Provides insights into relevant trends
- Can be compared with data from other sources (competitors)
Quantitive data drawbacks (2)
- Focuses on data rather than explaining why things happen
- May lack reliability if sample size and methods are not valid
Market segmentation (3)
Location
Demographics
Income
Benefits of market segmentation (4)
- Better matching a product to customer needs
- Help with new product development - focused on needs of the customers in the segment
- Allows a business to grow its shares in a market or effectively target fast-growing segments
- Helps make the marketing mix more effective e.g. better targeting promotion
Drawbacks of marketing segmentation (3)
- Imprecise science
- It does not mean it can successfully reach the customers in it
- Markets are dynamic and fast-moving
Market mapping advantages (4)
- More informed business decisions
- Can identify gaps in the market
- Can see their competitors is comparison
- Identify where demand is higher => more competitive areas
Market mapping disadvantages (3)
- Quickly goes out of data
- False information
- Requires skills to be more precise at building it
