5.4

• The collection and study of statistics and other

  relevant data helps managers understand the

  needs of potential customers or clients as well

  as providing information on what business

  competitors may be doing.
• Market research attempts to identify and

  outline both marketing opportunities and

  problems, as well as evaluating the

  implementation of the marketing plan.
• Effective market research can establish whether

  it is worth launching or promoting a product at

  all.

  Without adequate, reliable and correct

  information, businesses expose themselves to

  market embarrassments which could result in

  their product failing to sell.
• the 3 steps of market research include

  determining info needs

  collecting data from primary and secondary sources

  analysing and interpreting data
• Determining information needs


  The best method to determine the relevance of data is to constantly ask questions concerning its

  ultimate use.

  Information is useful if it:

  Results in marketing strategies that meet the needs of the business’s target market

  Assists the business to achieve its marketing objectives

  May be used to increase sales and profits

  Marketers should treat information in the same way as other resources within the business and weigh

  up the costs of collecting information against benefits it provides.
• Collecting data tools and techniques-

  Primary data refers to the information collected

  from original sources.

  This information can be collected by the

  business itself — a process that may be time

  consuming and expensive

  Or it can be outsourced

  The main advantage of primary data is that

  their collection is directed at solving a specific

  marketing problem.

  Their main function is to find out exactly what

  the customer is thinking.
• Types of Primary Data

  • The Survey Method
  • The Observation Method
• The Survey Method


  • Personal interviews
  • Focus groups
  • Electronic methods of collection
  • Questionnaires
• Personal interviews


  • Face-to-face interviews conducted in public places
• Focus groups


  • Small groups of people who meet with the researchers
• Electronic methods of collection

  • Online surveys
  • Data collected over the phone
• Questionnaires


  • A set of specific questions structured to obtain a response from the customer
• The Observation Method


  • Personal observation
  • Mechanical observation
• Personal observation


  • When a researcher poses as a customer in a store
• Mechanical observation


  • Using cameras, video or voice recorders, or counting machines
• The scanner and cash register at a store checkout counter can record data on sales and customers’ purchase patterns
• Collecting data tools and techniques-

  Secondary data is information that someone

  else has already collected.

  
  

  It is referred to as secondary because it is

  information that has been collected for some

  other purpose

  
  

  for example, census data and household

  expenditure surveys gathered by government and

  private businesses.

  
  

  Computer databases and information published

  online means that an abundance of secondary

  data is available to market researchers.
• The two types of secondary data are:

  Internal data: Information that internal sources have

  already collected. Such data include financial

  statistics, annual management reports, research

  reports, customer feedback and sales reports.

  External data: Published data from sources outside

  the business. Probably the best known are the

  numerous reports produced by the Australian Bureau

  of Statistics (ABS)
• Raw data is not useful until analysed and interpreted
• Data analysis steps


  1. Gather data

  2. Analyse data

  3. Interpret data
• Statistical interpretation data


  Data that helps in making conclusions from raw data
• First step in data analysis


  Tabulate the data
• Cross-tabulation


  • Allows comparisons to be made between individual categories
• This interpretation will largely be based on the marketers’ judgement, experience and intuition
• It is preferable to involve a number of people in the interpretation of data to gain a wider perspective
• Involving multiple people helps avoid the error of personal bias
• Market research involves

  determining what information

  needs to be discovered, the

  collection of primary and secondary

  data, and the analysis and

  interpretation of the collected data.

  Market research is the process of

  gathering information to assist

  business owners in making

  informed decisions about the

  marketing of the business.