1. Lesson 6: Market Research

2. Objectives Outline the five major steps in the market research process Describe how surveys can be used to learn about customer behaviors and competition Analyze the results from a market research survey, and explain how data may affect your business plan Compare and contrast qualitative and quantitative research Calculate the percentage of responses to a specific survey question Compute the cost associated with a market research survey

3. 1.What is Market Research? The process of gathering, recording, analyzing, and reporting information regarding customers or potential customers Can be collected through dialogue or formal methods

4. 2.Uses of Market Research To provide retailers with information about the target market Helps identify what services customers want, what merchandise to offer, customer satisfaction sales forecasting, measuring market potential, and product mix information Helps get ahead in global markets

5. 3. Market Research Process 1.Identify the Problem - Stated as simply and clearly as possible - Include information needed to solve it 2.Obtain Data – primary and secondary 3.Analyze Data – compile, study, interpret 4.Choose the Best Solution – usually done in a written report 5.Follow up on the Results – evaluate whether it was successful

6. 5. Obtaining Data Primary data – facts collected for the first time for the problem under study –Survey – series of questions asked to a select and representative group of people to obtain quantitative data –Observation – watching people by using other people or by using a camera (gives info about WHAT people do, not WHY they do it) –Focus group – 8-15 people who provide qualitative data through their opinions of the business and its products or other issues

7. Surveys Sample group – select group of people Sample size – number of people selected to participate –The larger the sample size, the greater the cost of the survey, but the more accurate it will be –Vice versa

8. 5. Obtain Data (cont’d) Secondary data – facts that have been collected previously for a purpose other than the problem being studied –Less expensive to obtain than primary data Usually select secondary data first, then decide the primary data to collect Internal sources – those from inside the business and include past sales and buying records External sources – those from outside the business, such as trade association, trade publications, internet sources, gov. sources, market research companies

9. 6.Types of Market Research Qualitative Research and Quantitative Research

10. 7.Key Math Concepts % of responses to a specific question = # responses for a ? ÷ total # responses Average or Mean of a group of numbers = Add numbers together and divide the total by the amount of numbers added

11. Decimals DecimalPercentage.3333%.044% PercentageDecimal 12%.12 6%.06 Move the decimal 2 places to the left. 6% 6.0% to the left =.06