Ecom Katay 2

Market Research

is the process of gathering, analyzing, and interpreting information about a market. It helps businesses understand their target customers, competitors, and industry trends. It answers important questions such as:

● Who are the customers?

● What do they need or want?

● How much are they willing to pay?

● Who are the competitors?

Two Main Types of Market Research

Primary & Secondary Research

Primary Research

Collecting new data directly from customers through surveys, interviews, or observations.

Secondary Research

Using existing data such as reports, articles, government statistics, or online sources.

Consumer Behavior

refers to the study of how individuals or groups select, purchase, use, and dispose of goods and services to satisfy their needs and wants. It focuses on understanding why consumers make certain decisions.

Factors affecting Consumer Behavior

Personal, Psychological, Social

Personal factors

age, income, lifestyle, occupation

Example: College students usually prefer affordable products because they have limited budgets. On the other hand, working professionals may choose more
expensive products for convenience.

Psychological factors

motivation, perception, attitudes

Example: A customer believes that expensive skincare products are higher quality. Because of this perception, they choose a premium brand instead of a cheaper option.

Social factors

family, friends, social media, culture.

Example: A student buys a trending item after seeing positive reviews on TikTok.

This shows how social media influences buying decisions.

Tools Used in Market Research

surveys, interviews, focus groups, observation, online analytics

Surveys

are one of the most popular tools in market research. They can be conducted online, by phone, or face-to-face. Surveys help gather information about customer preferences, satisfaction, and opinions.

Interviews

allow researchers to ask detailed questions and get deeper insights. They can be structured (with prepared questions) or unstructured (open conversation).

Focus Groups

is a small group of people who discuss a product or
service. It helps businesses understand customer reactions and suggestions.

Observation

involves watching how customers behave in real-life
situations. For example, businesses may observe how customers choose products
inside a store.

Online Analytics

used to track website traffic, customer behavior, and engagement. Social media platforms such as Facebook and Instagram also provide data about audience demographics and interactions.

Consumer Behavior Trends in the Digital Environment

Online Shopping Growth, influence of social media, mobile usage, personalization, customer reviews and feedback

online shopping growth

allow customers to shop anytime and anywhere. Consumers compare prices, read reviews, and check ratings before buying.

Influence of Social Media

Social media platforms like TikTok and Facebook influence buying decisions. Many consumers trust influencers and online reviews more than traditional advertisements.

Mobile Usage

Many consumers use smartphones for browsing and shopping. Mobile-friendly websites and apps improve customer experience and increase sales.

Personalization

Digital platforms use data to personalize ads and recommendations. For example, streaming platforms like Netflix recommend shows based on viewing history. This makes consumers feel understood and increases engagement.

Customer Reviews and Feedback

Before purchasing, many consumers read online reviews. Positive reviews build trust, while negative reviews can affect a brand’s reputation.

Segmentation Strategies

demographic segmentation, geographic segmentation, psychographic segmentation, behavioral segmentation

Demographic Segmentation

This divides the market based on age, gender, income, education, or occupation.

Geographic Segmentation

This divides customers based on location such as country, city, or region.

Example: A business in Diliman may focus on students and residents nearby.

Psychographic Segmentation

This focuses on lifestyle, interests, values, and personality.

Example: A fitness brand may target health-conscious individuals.

Behavioral Segmentation

This is based on customer behavior, such as purchasing habits, brand loyalty, or usage rate.

Example: Loyal customers may receive special discounts or rewards

How should businesses collect consumer data responsibly?

• With consent

• Data minimization

• Data security

• Control and access

Technology integration

is defined as the use of technology to enhance and support an environment — originally this concept was used in education.

Market Research and Consumer Behavior Steps

Step 1: Define the Problem

Step 2: Identify Target Market

Step 3: Collect Data

Step 4: Analyze Data

Step 5: Test MVP

Product Sourcing

is the process of finding, acquiring, and managing the supply of products that a business intends to sell online. It is a critical first step in e-commerce, impacting product availability, quality, pricing, customer satisfaction, and brand reputation.

Product Sourcing Type

Direct Sourcing, Wholesale Sourcing, Dropshipping, Private Labeling, Sourcing from Creators, Digital Product Sourcing

Wholesale Sourcing SWOT

• Convenient, wide product selection, lower risk

• Lower margins due to middlemen

• easy expansion of product lines

• high competition

Dropshipping SWOT

• Low startup cost, no inventory storage

• Limited quality and shipping control

• easy testing of trending products

• Supplier delays can harm reputation

Private Labeling SWOT

• Strong branding, higher perceived value

• Requires marketing and branding investment

• Builds customer loyalty and brand identity

• Manufacturer quality issues

Sourcing from creators SWOT

• unique, niche, premium products

• Limited production capacity

• ethical branding and niche targeting

• scalability challenges

Digital Product Sourcing SWOT

• no physical inventory, high margins, global reach

• risk of piracy and duplication

• growing demand for online learning

• rapid tech changes

Direct Sourcing SWOT

• Lower costs, better quality, higher margins

• requires bulk orders and strong supplier management

• Product customization and innovation

• Supply Chain disruptions, supplier dependency

Inventory management systems

are tools or software that track, organize, and manage a business’s stock of products. In e-commerce, they are extremely important because they help ensure that the right products are available to meet customer demand while minimizing costs and errors.

Importance of Inventory Systems

Prevents stockout, reduces overstock, improves order accuracy, supports growth

Functionality of inventory management system

• Tracks product quantities across warehouses or stores.

• Integrates with e-commerce platform, so online listings reflect real time availability

• Updates stock levels automatically when orders are placed or returned.

• Generates reports on best-selling products, low stock, and sales trends.

E-Commerce Supply Chain

It is a network of processes for the flow of goods that acts as a chain. It integrates technologies to streamline the production and fulfillment of online orders for e-commerce businesses.

Processes in E-Commerce Supply Chain

Sourcing and Production, Inventory Management, Order Processing, Shipping and Delivery, Returns and Customer Service, Technology Integration

Sourcing and Production

At the start of the E-commerce supply chain, finding the best source of materials is

crucial to meet the quality of the product and the efficiency of its cost.

Inventory Management

software that helps businesses track their orders and automate them,

Order Processing

This process begins when a customer checks out the item on the E-commerce

platform.

Shipping and Delivery

This stage involves the movement of goods from the warehouse to the customer's

location. Logistics is the one responsible for this, where they coordinate with

carriers to move the products efficiently.

Returns and Customer Service

The process of reverse logistics handles the product's return to be inspected and refunded to the customers. This part allows to build consumer's trust because the business acknowledges the defaults and ensures accountability for the items.

Technology Integration

connects every part of the E-Commerce Supply Chain. This streamlines every process to make the whole operation run smoothly. It includes having an Inventory Management System, Order Process Software, Customer Relationship Management tools, and automated data analytics

Processes in E-Commerce Logistics

Supplier, warehouse, fulfillment center, carrier, customer

Customer

The logistics process continues even after the products reaches the customer. Since

there can be returns and exchanges that would occur, this then leads the item back

into a reverse logistics process. Providing a clear return policy and efficient systems

for the return handling process ensures trust for the customers.

Carrier

These parts are where the goods are given over to the carriers who handle the

transportation and last-mile delivery of goods to the customers.

Fulfillment Center

It is the place where goods have been ordered and are being prepared for packing

and shipping.

Warehouse

It is the place where the inventory is stored before the customers are received

Supplier

The goods are moved at the start by the supplier, where they are delivering the

inbound goods to your warehouse. The products would then be stored until they are

ready to be distributed to the customers.

Shopee

They offer an integrated service of their logistics called _______ Supported Logistics

(SSL). This is where they partner across several carriers, such as J&T Express, SPX

Express, or Flash Express, for convenience from different sellers and provide easier

options as well for the consumers. These options allow for a seamless flow of goods to

customers for fast shipping and for convenient order placement.

Lazada

uses technology-driven solutions for integrating its logistics in the supply chain

network for e-commerce in Southeast Asia. It also optimizes its inventory

management using data analytics. They use automated systems such as Apollo to

streamline the entire logistics process from sellers to customers. This platform also provides services such as the ______ Global Fulfillment (LGF) and cross-border logistics solutions to support international trade.

Enterprise Resource Planning (ERP) inventory management

is a system that allows businesses to manage all aspects of their business on a single platform, including: inventory, finance, planning, logistics and operations.

Supply chain transparency

When a business can effectively integrate back-end systems and communicate directly with its partners, that minimizes disruptive surprises, like a critical component not being delivered when expected or being priced higher than makes sense for the product.

Blockchain technology

it has great features such as: unalterability of data, traceability, and transparency. It ensures cooperation with stakeholders in the supply network and increases process-added value

International Sourcing

also referred to as global sourcing, can be defined as the acquisition of quality products and services from global suppliers on the most favorable terms of trade.

it is a global procurement strategy that aims to tap into the benefits of the global economy to enhance the quality of products and simplify the supply process.

example:

Penshoppe – A famous clothing brand in the Philippines and across Asia and the Middle East, but their materials and fabrics sourced from overseas suppliers to meet global fashion trends and production needs.

Local Sourcing

is a practice whereby an organization purchases products from suppliers

who are geographically close to the organization’s location, either within the same

country, region, or local community.

Example:

Kultura Filipino – A well known brand that highlights the distinct Filipino skills in art

and craftsmanship. It offers a variety of products made from indigenous materials that are best suited to capture the Philippine heritage and culture.

Sourcing

it is the process of finding and choosing suppliers who provide raw

materials, ingredients, or services your business needs. It is important as it ensures

businesses get reliable, quality inputs. It affects costs directly and builds resilience.

Logistics

it is the management of how goods move from suppliers to your business, and sometimes from your business to customers. It covers transportation, storage, and inventory control.

Pricing

it is the strategy of setting product or service prices based on costs,

customer value, and market conditions. It determines profitability, shapes customer

perception, and allows flexibility.