Market Research

A set of Q&A flashcards covering market research fundamentals, data types, sampling, and the relationship between marketing and other business functions.

What is Market Research?

The process of gathering primary and secondary data on the buying habits, lifestyles, usage and attitudes of actual and potential customers.

What are the general benefits of market research?

Identifies opportunities and threats, monitors sales after promotions, helps find alternative routes to problems, identifies the target market, and reduces the risk of failure.

What are the general drawbacks of market research?

Does not guarantee success; can be costly and time-consuming; data may be unreliable; sometimes intuition suffices; research costs money.

What is meant by 'Aids to decision making' in market research?

Helps to make informed decisions, especially in fast-changing markets.

Why might market research help with customer wants and expectations?

Helps find out what customers want and expect from products or services.

How can market research inform pricing strategies?

Finds out how much customers are willing to pay and helps develop pricing strategies.

How can market research help with competitive advantage?

Gains or maintains competitive advantage by understanding what competitors are doing and staying informed.

What is the 'Predictive' reason for market research?

What is likely to happen in the future.

What is the 'Exploratory' reason for market research?

Investigating new possibilities in a market.

What is the 'Descriptive' reason for market research?

What is happening in the market? Who is buying which products in our portfolio.

What is the 'Explanatory' reason for market research?

To find out why sales have fallen in the last six months.

How might consumers feel about market research?

Carrying out market research may make consumers feel their views are being considered.

What is the impact of market research on risk?

Reduces risk by informing product development and marketing decisions.

What is a limitation of market research regarding predictions?

Predictions may not always be accurate; consumer responses can change over time.

What does sampling bias refer to in market research?

Data can be based on an unrepresentative sample due to sampling discrepancies or bias.

What is primary research compared to secondary data in terms of cost and relevance?

Primary research can be expensive to gather; secondary data is cheaper but may not meet specific needs.

What is a limitation of secondary data?

Often outdated and may not meet the business's needs; limited control over quality.

Why carry out extensive market research?

Because of the expense of launching new products, maintaining market share, and preserving brand value; helps design products and campaigns that meet customer needs.

What is field research?

Collecting primary data and information that does not already exist; collected for a specific purpose through questionnaires, interviews, surveys, focus groups and consumer panels.

What are the advantages of field research?

Data is exclusive to the business, up-to-date, and can be targeted for specific needs.

What are the disadvantages of field research?

Expensive; time-consuming; potential bias.

What is desk research?

Identifies, collects and collates information that already exists; internal or external sources such as documents, official publications, yellow pages, industry magazines and online sources.

What are the advantages of desk research?

Inexpensive; quick; enables cost-effective analysis across multiple sources.

What are the disadvantages of desk research?

Often out of date; might not be available; little control over quality; interpretation problems.

What is quantitative research?

Collection of data that can be measured; numerical data such as sales figures and market share; uses surveys and official statistics; data is numerical and usually more objective.

What is qualitative research?

Collection of attitudes, beliefs and intentions; methods include focus groups, participant observation and interviews; data is open to interpretation and is subjective; usually gathered early in the research process.

How is marketing linked to other departments in a business?

Marketing influences staffing, what to produce and when, and how much to spend; it generates revenue and forecasts future sales; it also affects raw materials and transport needs.

What is a market research sample?

A group of respondents selected to be representative of the target market's views.

Why is sample size important in market research?

Large samples are more statistically valid but take longer and cost more; too small samples increase random error; larger firms benefit from economies of scale.

What is quota sampling?

Population is segmented by characteristics (e.g., age, sex) and interviewers are proportioned to reflect the segmentation; cheap but not statistically representative.

What is random sampling?

Every member of the population has an equal chance of being interviewed; difficult to achieve and can be costly; often used to reduce bias.

What is bias in market research?

Systematic distortion in data that can skew results; to avoid bias, use proper sampling methods and ensure the sample reflects the population.