Chapter 18: Marketing research

• Market research

  the process of gaining information about customers, products, competitors through the collection of primary and secondary data.
• Importance of market research

  •To reduce risks when launching a new product

  •To predict future demand changes

  •To explain patterns in sales of existing products and market trends 

  •To assess the most favoured designs, flavours, styles, promotions and packages for a product

  •To identify consumer charateristics

  •to identify the main features of a market: size, growth and competitors
• primary research

  Involves the direct collection of new and original data

  Ex: Questionnaires, Online surveys, Interviews, Focus Groups

  
  

  Advantages

  •Collection of first-hand data that is directly related to a firm’s needs

  •Can be highly focused and relevant

  Not available for competitors

  •Disadvantages

  •Expensive to collect, analyse and evaluate

  •time consuming

  •bias
• secondary research

  involves the collection of already existing data.

  Ex: Government statistics, demographics (age , gender, location), Market research Agencies, Online sources

  Advantages

  • cheap, readily available

  
  

  Disadvantages

  May not be updated frequently and may therefore be out-of-date, available to competitors
• Qualitative data

  non- numerical data that provides insight into motivations of consumers and buying behaviours or opinion
• Quantitative data

  Numerical data from research that can be statistically analysed
• Quantitative: measurable, numerical. Ex: Age, weight, height

  Qualitative: descriptive, non-numerical. Ex: Colours, names
• sampling

  the process of selecting a group of respondents from a larger population in order to make it easier to draw conclusions about the group without studying each individual

  
  

  
  

  limitations: may be too small, risk of bias, may not use appropriate method
• sample

  a group of people taking part in a market research survey to represent the overall target market
• sampling bias

  when a sample is not a good representation of the whole population, because it is unfair
• Random sampling

  Each member of the population has an equal chance of being selected; unbiased representation
• Quota sampling

  a method for selecting survey participants from subgroups and it is not based on randomness; biased