Part III – Developing the Entrepreneurial Plan Chapter 7 – Environmental Assessment: Preparation for a New Venture Chapter 8 – Marketing Research for New Ventures Chapter 9 – Financial Preparation for Entrepreneurial Ventures Chapter 10 – Developing an Effective Business Plan Copyright (c) 2004 by South-Western, a division of Thomson Learning. All rights reserved.
Chapter 8 – Marketing Research For New Ventures
Definition of a Market
A market is a group of consumers (potential customers) who have purchasing power and unsatisfied needs. A new venture will survive only if a market exists for its product or service.
Marketing Research involves the gathering of information about a particular market, followed by analysis of that information.
Defining the Research Purpose and Objectives
Gathering Secondary Data
Gathering Primary Data
Developing an Information-Gathering Instrument
Make sure each question pertains to a specific objective in line with the purpose of the study.
Place simple questions first and difficult-to-answer questions later in the questionnaire.
Avoid leading and biased questions.
Give concise but not complete directions in the questionnaire.
When possible, use scaled questions rather than simple yes/no questions to measure intensity of an attitude or frequency of the experience.
Interpreting and Reporting the Information
Inhibitors to Market Research
Developing the Marketing Concept
Market segmentation is the process of identifying a specific set of characteristics that differentiate one group of consumers from the rest.
Five Major Classifications:
Marketing Stages for Growing Ventures Stage 1: Entrepreneurial Marketing Stage 2: Opportunistic Marketing Stage 3: Responsive Marketing Stage 4: Diversified Marketing Marketing Strategy Market Niche Market Penetration Product- Market Develop- ment New- Business Develop- ment
Marketing information system
Unlimited geographic coverage
Better time management
Lower salary and commissions
Poor telephone techniques can defeat the telemarketing strategy.
Dissension between the field sales staff and the telephone sales personnel can arise.
Entrepreneurs must be aware of the ever-present problem of rapid turnover of telephone staff.
Marketing on the Internet
The Internet allows the firm to increase its presence and brand equity in the marketplace.
The Internet allows the company to cultivate new customers.
The Internet allows Web site visitors to match their needs with the offerings of the company.
The Internet can improve customer service by allowing customers to serve themselves.
The greatest potential for the future is probably in direct marketing, where catalogs can be offered online.
Pricing for the Product Life Cycle Product Life-Cycle Stage Pricing Strategy
Skimming – deliberately setting a high price to maximize short-term profits
Penetration – setting prices at such a low level that products are sold at a loss Growth Stage Consumer Pricing – combining penetration and competitive pricing to gain market share; depends on consumer’s perceived value of product Maturity Stage Demand-Oriented Pricing – a flexible strategy that bases pricing decisions on the demand level for the product Decline Stage Loss Leader Pricing – pricing the product below cost in an attempt to attract customers to other products