Market Research Flashcards
Define ‘market research’.
The collection of information that is then used to assist the business in key decisions.
Define ‘primary research’.
New information collected first-hand by the business owner for the purpose of the business.
Give five examples of primary market research.
- Interviews
- Questionnaires
- Telephone Surveys
- Observations
- Focus Groups
Define ‘secondary research’.
Gathers information that already exists and was used by somebody else in the past for a different purpose.
Give three examples of secondary market research.
- Internet Research (competitor websites for prices)
- Census data online
- Business/Industry related books/magazines
What are the advantages of primary research?
- Up to date and reflects current views.
- Business can ask specific questions related to it.
What are the disadvantages of primary research?
- Takes longer to collect.
- Costs more to collect.
- Family and friends’ opinions could be biased.
- Did the entrepreneur ask enough people and the right people to gain reliable results?
What are the advantages of secondary research?
- Using others’ research is much quicker and easier for entrepreneurs.
- Much cheaper as the business doesn’t have to spend time to create new research.
What is the disadvantage of secondary research?
The data collected could be out of date and not specifically related to the business in question.
Why is market research important?
It’s crucial for businesses to find out customers’ wants and competitors’ offerings.
When is market research valuable?
If enough research has been collected and is accurate enough for the business to make the correct decisions.
Define ‘quantitative research’.
Research results that can be analysed in a numerical way.
Define ‘qualitative research’.
Gathers a more in-depth understanding about people’s choices.
What is an advantage and disadvantage of ‘quantitative research’?
- Advantage; easy to interpret and compare as respondents tick the answer that best suits their views.
- Disadvantage; doesn’t explain why the respondent chose that answer.
What are advantages of ‘qualitative research’?
- More in-depth research is gained.
- Explains why the respondent had that opinion.
What is the disadvantage of ‘qualitative research’?
Difficult to interpret and compare as everyone could have different opinions.
Define ‘sampling’.
A group of respondents to a market research exercise selected to be representative of the views of the target market as a whole.
Define ‘random sampling’.
Where every member of the population has an equal chance of being selected to participate in the market research activity.
Define ‘quota sampling’.
A sampling technique more specific to a business. If a business knows that three out of every four of its customers will be university students then three out of every four people selected for the market research activity will be university students.
What does the usefulness of sampling depend on?
- Type of sampling - quota is more specific to the business than others.
- Sample size - the larger the more accurate.
- Researchers’ personal views getting in the way (bias).
- Whether research is based around friends’ opinions - more likely to be bias if friends are involved.
Why is it important for a business to avoid bias?
Asking family or friends may give an unrealistic opinion and asking a small sample can also result in inaccurate research.
