Marketing - Segmentation & Research Flashcards
What does market segmentation involve?
Putting potential customers into groups based on specific criteria or characteristics
What are the criteria a business can use to segment the market?
-Age,
-Gender,
-Income Level,
-Lifestyle/hobby,
-Religion,
Describe the ‘age’ method of segmentation:
consumers are divided into groups based on age brackets, e.g. 13-18 or over 55,
Describe the ‘gender’ method of segmentation:
consumers are grouped together based on the gender that they identify with as commonly used in the cosmetic and clothing markets
Describe the ‘income level’ method of segmentation:
consumers are grouped together based on how much disposable income they have
Describe the ‘lifestyle/hobby’ method of segmentation:
consumers who have a particular lifestyle or hobby are grouped together, e.g. vegetarians or gamers
Describe the ‘religion’ method of segmentation:
consumers are grouped together based on their religious or cultural beliefs.
What are the benefits of market segmentation?
-products or services will be better suited to the target marker’s needs or wants, leading to improved customer satisfaction,
-businesses will choose appropriate pricing that appeals to their target markets, leading to customers spreading the businesses name, causing an increase in image and reputation,
-businesses will sell their products in appropriate places where the target market shops, leading to an increase in sales,
-there is a decreased chance of product failure, leading to the likelihood of a reduction in wasted investment by businesses,
What is field research?
Research which involves a business gathering brand new information themselves using methods such as face-to-face interviews and focus groups. This type of research collects primary information.
What are the advantages of field research?
-the data collected is brand new and up to date,
-the data is not accessible to competitors,
-the research is tailored to the specific requirements of a business, meaning that the data gathered is highly relevant,
What are the disadvantages of field research?
-it can be an expensive type of research compared to desk research,
-it can be a time-consuming process, meaning that decisions cannot be made quickly,
Why would a business use market research?
-identifying what the target markets should be for their products or services,
-finding out what the target market’s needs and wants are so as to design products that satisfy them,
-finding out how much the target market would be willing to pay for products so as to set appropriate pricing,
-gathering information about competitors, allowing them to gain competitive advantages,
What is desk research?
Research which involves the use of pre-existing data that has been gathered by someone else. This type of research collects secondary information
What are the methods of field research?
-personal interview,
-telephone survey,
-postal survey,
-online survey,
-focus group,
-hall test,
Describe the ‘personal interview’ method of field research:
the researcher conducts a face-to-face interview with the respondent using a questionnaire containing standardised questions. Personal interviews allow the researcher to clarify questions for the respondent; however, they are a relatively time-consuming method of carrying out field research.
Describe the ‘telephone survey’ method of field research:
the researcher conducts an interview with the respondent over the telephone using a questionnaire containing standardised questions. Telephone surveys allow a large number of respondents to be surveyed at relatively little expense; however, many people see market research calls as a nuisance and will refuse to take
Describe the ‘postal survey’ method of field research:
a questionnaire is sent through the post to respondents who mail it back upon completion. Postal surveys can cover a wide geographical area and can target specific target markets based on postcode; however, they have a very low response rate as many people view it as junk mail.
Describe the ‘online survey’ method of field research:
a questionnaire is hosted on the internet for respondents to complete. Many online surveying tools such as Survey Monkey will provide automatic analysis, graphs and summaries of the data collected; however, this method relies on people having internet access.
Describe the ‘hall test’ method of field research:
respondents are given a sample of the product to try and their feedback is gathered. This method allows the researcher to gather high-quality, qualitative feedback instantly; however, respondents might feel compelled to give a positive response out of politeness
Describe the ‘focus group’ method of field research:
a group of volunteers from a target market are brought together to discuss a product. The researcher will record what is being said. The respondents have actively volunteered to be part of the focus group, which means they should have lots of opinions to share; however, organising focus groups is a relatively expensive and time-consuming method of research.
What are some common sources of desk research used by businesses?
-government reports and statistics (such as census data)
-reports produced by market research companies such as Mintel,
-competitors’ websites,
-trade magazines and journals,
-reputable newspapers e.g. the Guardian,
What are the advantages of desk research?
• it is a relatively inexpensive way of gathering and obtaining data;
• it is relatively quick to gather compared to field research, meaning that decisions can be made quicker;
• large amounts of information and data are available at little to no cost;
What are the disadvantages of desk research?
• the data gathered could be out of date, leading to poor decisions being made;
• the same information is also available to competitors;
• the information might contain bias.
