Market Research

Marketing Issues and Concepts Market research is a broad and far reaching process Not just used to find out if consumers will buy your product or not its concerned with: Reaction to your marketing mix! Market research is in its self a growth industry with more and more companied out sourcing to specialist companies.

Market Research Marketing Issues and Concepts So, Why are companies prepared to pay high premium for market research ? To reduce risk with a new product launch To help predict future changes To help explain patterns in sales To assess the most favored designs/methods/styles and promotions that consumers prefer Market Research can also be used to discover … Market size Strengths and weaknesses of a product Effectiveness of promotions Competitors positions in the markets

Market Research Marketing Issues and Concepts IMPORTANT that you know about primary and secondary research and the different methods used. Primary: Quantatative research – leads to numerical results that can be analysed Observations Test marketing Consumer surveys

Market Research Marketing Issues and Concepts Who to ask ? Sample size … The larger the sample the more confident you can be of a true result. This is especially true in an example of a food brand trying to survey consumer reaction to a new product. Major stumbling block to the size of the sample is ? The cost and time taken to do it. What are the main sampling methods? – REMEMBER these are all PRIMARY methods!

Market Research Marketing Issues and Concepts Random sampling – list of a target market is drawn up and people at random chosen off the list, electronically or every nth person (systematic random sampling). Stratified sampling - dividing the population into sub- groups and sampling from those sub-groups that are going to be interested in the product. E.g. a new magazine aimed at year old boys, there is no point asking different 20 year old women

Market Research Marketing Issues and Concepts Quota sampling - – Interviewees are selected according to the different proportions that certain consumer groups make of the whole survey population. e.g. consumer of denim jeans: male – 65% female – 35% Age = 35% = 35% = 20% over 41 = 10% The sample would then be in the same proportion. If 200 were interviewed, 130=males (65%), 70 = females (35%) and of that, 70 would be between (35%)

Market Research Marketing Issues and Concepts Cluster sampling – when a full sampling frame is not available, a product is only going to appeal to a certain group. E.g. a local newspaper researching readers opinions. Cluster sampling will just take a sample from this group. Random methods can be used to select a sample from this group.

Market Research Marketing Issues and Concepts What and how to ask the right questions are very important Do you ask the questions or do you leave it to the person to fill in on their own ? Depends really on the type of product you are testing for You need to consider how accurate are your answers going to be? ALL need to be valid questions ! How do you lay out the questionnaire for your and the respondents convenience?

Market Research Marketing Issues and Concepts So, how reliable is Primary research? Sample Bias? Questionnaire Bias – “pressured responses? Other forms of Bias – not wanting to be honest in your responses!

Market Research Non Probability Sampling … Cannot be used to make judgments on the whole of the population! Results not very accurate, but cheaper and quicker to use! Convenience Sampling – who is the easiest to sample? Snowballing Sampling – a friend of a friend of a cousin of a brother … Judgemenal Sampling – Using your own knowledge on who to ask! Experience can give you a “gut feeling” Ad Hoc Quota – “pick a number”! – say 60% of women!

Market Research Marketing Issues and Concepts Secondary – the use and analysis of data that already exist. “second hand” Government statistics Local libraries Trade Organisations Market Intelligence Reports (Mintel, Keynotes) Newspaper reports and specialist publications Internal Company records.

Market Research Marketing Issues and Concepts What happens to the data ? Raw data is translated into information in a number of different ways such as bar charts, tables, formal reports, pie charts, histograms etc…

Market Research Methods and use of presentation … Pg 278 – be aware of what the graphs are most useful for! But, you may be asked to calculate or identify the following off data! Arithmetic Mean (Average) – Total all of the results and divide by the number of results 8.65 Mode – The value that appears the most in a range of data (easier to sort data for this!) 10 Median – The middle point of ranked data – so it is divided into 2 equal parts Pg 287 – Case Study 2