1.2 Spotting Business Opportunity

• What are the customer needs

  price, convenice, quality,choice
• Why are understanding Customer needs important

  help to generate sales, and for business survival
• What is Primary Research also known as

  Field Research
• What is Secondary Market Research also known as

  Desk Research
• Types of Primary Market Research

  surveys

  questionnaires

  focus groups

  observation
• Types of Secondary market research

  internet, government report, market report
• The purpose of market research

  reduce risk, make informed business decisions, identify gaps in the market, identify and understand customer needs
• Why is Market Mapping important

  identify gap in the market, see competition
• Types of market segmentation

  age,location,demographics,income,lifestyle
• What are the strengths and weaknesses of competitors based on

  price, quality, location, product range and customer service
• What does competition impact on the business

  its decision making
• Advantages of Primary Market Research

  Specific to the business, Provides detailed information, Relevant and up to date, Can gather a mixture of quantitative and qualitative data
• Disadvantages of Primary Market Research

  Time consuming, Expensive, Sometimes difficult to collect
• Advantages of secondary research

  Quick and easy to gather, Often easy to analyse, Can provide industry-specific information
• Disadvantages of secondary research

  Not specific to the business, Could be out of date, May be biased or inaccurate
• Qualitative data

  • is usually expressed as opinions
  • includes descriptive information
  • is gained using open-ended questions,
• Quantitative data

  • is usually numerical data
  • is gathered through the use of closed questions, such as ‘yes’ or ‘no’ responses, multiple-choice options or a rating system
  • can generally be expressed in a graph or chart
• Advantages of Social Media

  • it is cheaper than other forms of research, such as using a market research agency, and can often be free
  • it can save time putting information together, eg some online questionnaires put the results into a graph instead of the researcher doing this themselves
  • it allows businesses to spot the latest tastes and trends, and monitor the behaviour of their competition
• Social Media helps with giving access to local, national, and international customers.
• The advantages of having reliable market research data include:

  • the business can make properly informed decisions
  • reduces risk
  • means less money is wasted
  • gives a higher chance of business success
• The consequences of relying on unreliable market research data include:

  • the business making unwise decisions
  • it could ultimately cost the business money
  • the business could bring out products that don’t sell
  • the business could fail
• Having reliable market research data is essential. Basing decisions on unreliable research can be very costly to a business.

  For research to be reliable, it must have a high level of validity. This means that the facts and evidence gathered are accurate.