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Market Research Overview

Market Research

  • Involves gathering, analyzing, and presenting information about marketing and consumption.

  • Aims to identify customer needs, predict demand, and understand consumer behavior.

  • Helps determine buying frequency, price points, customer types, sales channels, and desired product features.

Types of Market Research
Primary Research: Collecting new, original data for a specific purpose.
Secondary Research: Collecting existing data from sources like business records or published sources.
Primary Market Research Methods
  • Questionnaires/Surveys: Postal, online.

  • Focus Groups: Discussions with groups of customers.

  • Consumer Panels: Ongoing feedback as a product evolves.

  • Face-to-Face/Telephone Interviews

  • Product Trials: Testing by consumers before launch.

  • Test Marketing: Initial sales in a small area.

Secondary Market Research Methods
  • Website Information: Competitor pricing, product details.

  • Social Media: Data trends, consumer comments.

  • Newspapers & Magazines: Articles on industry sectors.

  • TV/Radio: Documentaries, consumer trends.

  • Market Intelligence Reports: Detailed sector trend information.

  • Government Statistics: Freely available data on various topics.

Primary Data: Advantages & Disadvantages
  • Advantages:

    • Collected for specific business questions.

    • Confidential; not accessible to competitors.

    • Only way to find specific information.

  • Disadvantages:

    • Time-consuming and costly.

    • Potential sampling errors.

    • Risk of bias from question phrasing.

Secondary Data: Advantages & Disadvantages
  • Advantages:

    • Quick, low cost, and easy to collect.

    • Multiple sources can be compared.

    • Useful for refining primary research questions.

  • Disadvantages:

    • May not be precisely what the business needs.

    • May be outdated or irrelevant.

    • Potential for bias.

Quantitative & Qualitative Data
  • Quantitative Data: Numerical data for easy measurement and analysis.

    • Easy to chart or graph trends.

    • Often from surveys or government statistics.

  • Qualitative Data: Opinions and beliefs.

    • Requires interpretation.

    • Provides valuable insights into consumer behavior.

    • Difficult to analyze.

    • Often from focus groups or interviews.

Problems with Survey Design
  • Leading questions.

  • Unclear questions (jargon).

  • Closed questions (data coarsening).

  • Irrelevant questions.

  • Surveys that are too long.

  • Bias from incentives.

  • Sampling errors.

Using Databases for Market Research

Databases store electronic records of business transactions.

  • Businesses can use their own or buy data from other sources.

  • Advantages:

    • Relatively easy to use; can be primary data.

    • Trends can be analyzed over several years.

  • Disadvantages:

    • Data may be outdated.

    • Data may not be in a useful format.

Sampling Methods

Sampling saves costs and time, and can be accurate if done correctly.

  • Random Sampling
    Randomly choosing participants; each has an equal chance.

    • Reduces selection bias.

    • May include people outside the target market.

    • Requires a larger sample for accurate results.

  • Quota Sampling
    Targets specific groups of a population that represent a market segment/group.

    • Saves time and cost.

    • May be inaccurate due to the lack of random selection.

  • Stratified Sampling
    Divides the population into subgroups (strata) based on shared characteristics and randomly samples each.

    • Creates a more representative sample.

    • Allows comparison between sub