WHAT IS MARKET RESEARCH? “ Market research is the systematic gathering , recording and analysing of data about problems relating to the marketing of goods and services.” “ Market research is the means by which those who provide goods and services keep themselves in touch with the needs and wants of those who buy these goods and services.”
METHODS OF RESEARCH
There are 2 main sources of information which organisations make use of:
METHODS OF RESEARCH
this is information collected by the organisation itself or by a paid market research agency
this is information already collected for another purpose, e.g. government statistics
There are 2 main types of market research:
Involves the use of PRIMARY data which does not already exist and must be collected from scratch. Methods include:
Use of technology
(EPOS & Loyalty Cards)
COSTS & BENEFITS OF FIELD
collected for exact purpose required by the organisation
not easily available to competitors therefore can be used to gain marketing advantages over rivals
requires specialist researchers
3 decisions to be taken:
Who is to be surveyed. This will be the POPULATION that you plan to target in your research.
How many people should be surveyed from the target POPULATION?
How do we choose those to be included in the survey?
METHODS OF SAMPLING
the sample is selected at random
main advantage is that no bias is involved in selection
main disadvantage is that it may not focus on any particular market segment
Stratified Random Sampling
the sample is divided into segments based on previous knowledge
e.g. the researcher knows that 10% of the population are in socio- economic group AB, 50% in C and 40% in DE.
Main advantage is that this method makes the sample more representative of the population
This involved the population being segmented into groups which share specific
characteristics (gender, age, income, marital status etc)
It is the job of the researcher to find and interview the people who fit th
Main advantages are that this method provides a more targeted method of
sampling and it is cheaper than random sampling
customers’ comments and complaints
sales representatives’ reports
market research data gathered earlier
Involves the use of SECONDARY data which already exists in some form having been collected for another purpose. This information may be internal or external.
Market research organisations - Mintel
Newspapers, magazines, CD ROMs
Secondary data is available from a wide variety of external sources. Although this information has been collected for another purpose, firms may be able to adapt it for their own use. Organisations may have to pay for access to this data but this will still be cheaper and probably less time-consuming than primary research
BENEFITS OF MARKET RESEARCH
aid to decision-making
provides a link to outside world
PROBLEMS WITH MARKET RESEARCH
- results from a small group may turn out to be completely different from the reactions of the wider population
- while the responses of the sample may be correct at the time of the research, opinions change
- the interviewer may have led the interviewee into saying what they think the interviewer wants them to say
Organisations continually try to obtain primary information about the market in which they operate.
Describe the advantages and disadvantages of 3 types of field research an organisation could use to obtain primary information. (2007, S2, Q1(a)) (8 Marks)
Carrying out market research does not necessarily guarantee success in the market.
Explain why information gathered by an organisation might be of little use to them? (2001, S2, Q1(b))
A sports goods manufacturer is considering introducing a new range of trainers.
(a) Describe and justify 3 methods of field research which would tell them whether or not this proposal is viable.
(b) Describe the difference between random and quota sampling.
(c) The manufacturer chose quota sampling rather then random sampling when conducting research. Justify the choice of quota sampling. (2004, S2, Q2(d))