1. Market Research

2. Learning Objectives
Know and understand the purpose of market research and analyse the costs and benefits of market research to businesses
Know the different methods of market research, give examples of appropriate research methods for given situations and discuss the advantages and disadvantages of the different methods

3. Market Research
Market research is the process of gathering and interpreting data about customers and competitors within a firm’s target market.

4. Starter
Activity - Find out what is the most popular flavour of ice cream of everyone in the room
How is market research carried out?
Why is market research needed?
Why is there a need for sampling?

5. Purpose of Market Research
Market research is carried out to:
Help firms make marketing decisions
Reduce risk
Data may be gathered for different reasons e.g. to identify current and future needs of consumers, the price customers will pay for a product or the success of a promotional campaign.

6. Continued…
Popular theory suggests that there are four reasons why market research might be carried out:
Describe the market – explore trends, establish market share, find out who customers are.
Explain the market – why market share has fallen, why customers prefer competitors products.

7. Continued…
Predict changes – what customers will do if price rises, impact of increased competition.
Explore future reactions – customer reaction to new ideas, find target price, establish most appropriate retail outlets.

8. Primary Research (Field)
Primary research involves finding out new, first-hand information. This is called primary data.
Methods of primary research include:
Questionnaires
Focus groups
Observation
Questionnaires may be face-to-face, telephone or written.
Focus groups allow for more qualitative data to be collected and follow up questions can be posed to gain a greater understanding of opinions and feelings.
ICT is increasing being used in market research. Data is gathered using online questionnaires and loyalty card schemes. Observation can be carried out using CCTV.

9. Methods of Primary Research
Questionnaires – Survey asking a series of pre-set questions. Gathered via post, telephone or face to face
Interviews – Focuses on a small number of individuals who are able to give detailed and precise information about their views and opinions

10. Continued…
Observation – Observing customer behaviour and watching shoppers in action
Test marketing – Trialling ideas and testing out products with a particular group
YouTube - Product Testing Institute - Surfers

11. Continued…
Focus group – Small number of people brought together to focus on a particular product
You Tube - Dodge Commercial - Focus Group
Consumer panels – consumers in a specific sector answer specific questions

12. Primary Research Benefits Drawbacks Directly relevant to the business
Up-to-date data obtained
Competitors do not have access to the findings
Time consuming
Often expensive
Results may be misleading if the sample size is too small, questions are unclear or there is interviewer bias
Bias may occur if questions are written or posed in a way that leads the respondent into answering in a particular way.

13. Secondary Research (Desk)
Secondary research involves gathering existing information. This is called secondary data.
Sources of secondary data include:
Market research reports
Trade journals
Government statistics
Sales and customer records
Secondary Research is grouped according to internal and external

14. Methods of Secondary Research
Internal data
Sales Figures – Provides accurate results from previous time periods. Used to establish patterns of behaviour
Annual Report and Accounts – Provides accurate results from specific years.

15. Continued…
Customer data – Firms gather information about their customers e.g Loyalty cards, spending according to time and day
Previous surveys – May be some relevant data.
Company Intranet – Trends between stores in the same firm

16. Continued… External Data
Government Statistics – Useful data about population change, local/national trends and industries
Competitors – Accounts and sales brochures
Trade publications – Specific to industries

17. Secondary Research Benefits Drawbacks Often quick and easy to collect
A wide range of secondary data is available, especially on the internet
Data may not be reliable or up-to-date
May not be totally relevant
May not be in a form that is easily interpreted and analysed

18. Quantitative Research
Quantitative market research involves finding numerical data
Quantitative data is generally collected from large samples and is easy to analyse
Methods of collecting quantitative data include written and online questionnaires

20. Qualitative Research
Qualitative research involves finding out opinions, attitudes and feelings
Often more useful than quantitative data but is more difficult to collect and analyse
Methods of collecting qualitative data include focus groups & in-depth interviews

21. Learning Objectives
Know and understand the purpose of market research and analyse the costs and benefits of market research to businesses
Know the different methods of market research, give examples of appropriate research methods for given situations and discuss the advantages and disadvantages of the different methods

22. Plenary Primary or Secondary market research???
Conducting a survey of every fifth person who passes you in the street
Looking up information about people buying different types of insurance in a Mintel survey
Asking your classmates 20 questions
Copying out information from the Manchester Evening News
Interviewing people through a telephone survey
Sending questionnaire through the post
Using the population census to find out about the people living in Bury