3.3.2 Understanding markets and consumers

• What is primary research?

  Collecting original data directly from sources
• What methods are included in primary research?

  Surveys, interviews, focus groups, observations
• What type of information does primary research provide?

  Current, specific, and tailored information
• What is secondary research?

  Analyzing existing data from various sources
• What are the advantages of secondary research?

  More cost-effective and time-efficient
• What is the difference between qualitative and quantitative data?

  • Qualitative Data: Descriptive insights into opinions
  • Quantitative Data: Numerical information for analysis
• What is the formula for market growth?

  Market Growth (%) = (New Size - Old Size) / Old Size * 100
• What is the formula for sales growth?

  Sales Growth (%) = (New Sales - Old Sales) / Old Sales * 100
• What is the formula for market share?

  Market Share (%) = (Company Sales / Total Market Sales) * 100
• What is market size?

  The sum of all sales revenue in a market
• What are the sampling methods in marketing research?

  • Random Sampling: Equal chance for all members
  • Stratified Sampling: Divided into subgroups for representation
  • Quota Sampling: Reflects certain characteristics of the population
• What is random sampling?

  Every member has an equal chance of selection
• What is stratified sampling?

  Dividing population into subgroups for sampling
• What is quota sampling?

  Researchers select samples reflecting population characteristics
• What is correlation analysis in marketing data interpretation?

  • Positive Correlation: Both variables increase together
  • Negative Correlation: One variable increases, the other decreases
  • Strength: Measured by correlation coefficient (-1 to +1)
• What indicates a strong relationship in correlation analysis?

  Values close to +1 or -1
• What are confidence intervals?

  A range likely containing the true population value
• What does a higher confidence level indicate?

  More reliable estimates of population parameters
• What is extrapolation in marketing data interpretation?

  Using historical data to predict future trends
• What is price elasticity of demand (PED)?

  • Measures demand changes due to price changes
  • Elastic Demand (PED > 1): Sensitive to price changes
  • Inelastic Demand (PED < 1): Not sensitive to price changes
• What indicates elastic demand?

  PED > 1
• What indicates inelastic demand?

  PED < 1
• What is income elasticity of demand (YED)?

  • Measures demand changes due to income changes
  • Positive YED (> 0): Normal goods
  • Negative YED (< 0): Inferior goods
• What indicates a normal good in terms of YED?

  Positive YED (> 0)
• What indicates an inferior good in terms of YED?

  Negative YED (< 0)
• How do price changes affect total revenue based on demand elasticity?

  • Elastic Demand: Price increase may reduce revenue
  • Inelastic Demand: Price increase may increase revenue
• How do income changes affect demand for goods?

  • Normal Goods: Increased income boosts demand
  • Inferior Goods: Increased income reduces demand
• What is the value of price and income elasticity of demand to marketing decision makers?

  • Helps set optimal pricing strategies
  • Aids in predicting demand changes
  • Guides product development and target market decisions
• What are the uses of data in marketing decision-making and planning?

  • Market Segmentation: Targeting specific groups
  • Trend Analysis: Predicting future behavior
  • Performance Monitoring: Measuring campaign effectiveness
  • Strategic Planning: Informing product and pricing decisions
• How can understanding marketing concepts enhance business success?

  • Informed decisions improve customer satisfaction
  • Better meet customer needs
  • Enhance overall business performance