This document provides an overview of marketing and the market research process. It discusses key aspects of marketing including developing a marketing mix, understanding consumer behavior, and conducting market research. The summary discusses conducting primary and secondary research to understand the target market, market size, trends, and using the research to evaluate the viability of a business.

1. MARKETING
Introduction:
Marketing is the theory and practice of presenting, advertising and selling of goods.
Marketing actually means and covers everything from company culture and positioning
through market research new business/ product development, advertising and promotion,
PR (Public/press relations), and arguably all of the sales functions as well. Marketing is
the process by which a business decides what to sell to whom, when and how and then
does it.
The marketing process including domestic and global market assessment, strategic
marketing planning, and the development of an effective marketing mix (product, price,
promotion, and distribution) to create customer value. The marketing concepts such as
consumer/business, buying behavior, market research, brand management, product
development, and techniques for pricing, promotion and distribution are covered.
Market research involves the following steps:
1. Define the problem and set research objectives
2. Develop a plan to collect data from primary and secondary sources
3. Collect information through desk research or fieldwork,
4. Analyze the information to find averages, variable and various relationship of the
data
5. Present the main findings to management/ staff
Primary data consists of original information collected specifically for the purpose of
hand and is collected through fieldwork. Secondary data is information which already
exists somewhere, perhaps in another form, and was collected for another purpose. It is
identified and analyzed by desk research.
1

2. Keys aspects of market research to identify potential markets:
1. Number of potential customers
2. Characteristics of potential customers
3. Target market
- Segmentation
- Primary and secondary customers
4. Product or service characteristics
- Price and quality levels
5. Competitors characteristics
- Analysis by price and quality
Market area, size and Trends:
This is the section of the market research in which you will define your market area,
determine the size of the market, and analyze the trends that are likely to affect the
market.
Market area:
Specify your market. In what geographical are is your market located? If you are a mail
order firm, your market may be spread out all over the country or even the world. If you
are a small copying centre, your market may be limited to the tenants of the office
building that you are located in.
Market size:
Once you have identified your market, determine the size of that market. The
determination should always be done in value and in unit sales. It is useful to have
several years of figures so that comparisons can be made. Is the market increasing,
decreasing or stable?
Market trends and outlook:
2

3. While historical data in market is important, it is not correct to merely project from that
data into the future. Other factors may cause the market to change drastically. One way to
estimate the outlook for the future is to analyze trends that are occurring or are expected
to occur in the market. The analysis of these trends is important not only to determine
market size but also to determine how you can best operate in the market.
Knowing the trend tells you much about the expected size of your market but it also
poses questions that you will want to consider when deciding how to operate your
business.
Doing the research:
Your research may require primary or secondary sources, depending upon your market. If
your market is a large one, you may be able to find most or all of the information from
published sources. For small or specialized marcets, however, it may be necessary to
estimate the sales in the market. One might list all the business selling similar or
substitutable products in this market, estimate their individuah sale and total them.
Obviously, this is practical only if the number of business is small.
Detereining the trends in market is also done through a combination of primary and
secondary research. The critical element in this research is identifying trends that are
rele6ant. There may be a lot of things that are happening in your market, but do they all
affect your business in some significant way? When doing this research you may begin
by looking at the demographics. Are there shifts (actual or expected) in the number of
people in the location of the people in the age, sex, ethnicity, or income of the people in
the market?
Next consider whether there are significant changes in the opinions, outlook, or behavior
of the people in the market. Next consider the changing physical and economic
environment of the market area. Once you have compiled a list of trends that you think
will have an effect upon your business, decide what that effect will be. In many cases,
each relevant trend will have more than one effect upon your business.
3

4. Non-demographic trends may also be found in second sources but is mostly found in
primary research. You should first talk to the people in the area in the position to know
change in the locality and its people. Speak to bankers, suppliers, and builder and
community leaders to get their input about changes. Following that, you may want to
undertake a survey or series of interviews with a small sample of the people in the area.
(Surveys or questionnaire that you use should be co-ordinate so that the same survey for
instance can be used to uncover information about you product, your competitors etc.)
Using the research:
Once the research is complete, analyze the information and see if you can answer, to your
satisfaction questions such as these: is the market large enough to support my business?
Should I broaden or narrow my market area? Taking the history, present trends and
expected changes in the market area into account, what is the outlook for this market in
the next two years, five , ten year? In addition to these types of questions, you should
analyze your research to answer questions about your operating methods. Do you have
information that suggests for instance where you should locate your business? If certain
area within your market are expanding while others are deteriorating. It may make sense
to locate in the expanding are. Market research can be combined with the procedures and
activities of making the business plan. In the case, the size of the market and the
estimated turnover are often the most important questions.
Stages in market research:
1. Analyze: First you must have a clear view about what you want to know. When
making your first business plan, the questions will be directed at the size of the
market and the estimated turnover. The question of the estimated turnover can be
divided into questions like:
*who is my target group?
*what is my target area?
*how many members of my target group live in my target area?
*what is the yearly expenditure on the product or service I intend to provide?
4

5. *how many competitors do I have?
You will find that by formulating such question is much easier to answer the main
question. It makes it easier to define the information that you will need to answer and
how these data can be collected / obtained
2. Collecting the necessary data and using it:
In this stage you are actually collecting the necessary information. You will have to do
this in an efficient way, first through desk research then followed by field research, if
necessary. The next step is to put all your research result together. You have collected
data but there is no apparent connection yet. To clarify and to create a better insight your
can make calculations. Sort out and list all the information. You have collected. After
sough ting out everything, you will be able to find out if the collected data is enough to
answer all the formulation questions.
3. Making Conclusions:
The final step is to analyze the information and make conclusions. Have you found
answers to the questions and can you answer the main question with all the answer you
obtained? It is imperative that you remain objective. Many entrepreneurs tend to be
optimistic about their market and their estimated turnover.
Subjects for Market Research
1. Who is my target group?
Depending on the product or service you would like to sell, you can almost always define
a particular target group for your business. If you, for instance, are selling computers
school and suburbs will be your target group. If you are going to sell very exclusive
ladies fashion rich women will be your target group. If you offer services for small
business, the target group will be small businesses. So the first question about the target
group can be answered by writing the target group characteristics.
5

6. 2. What is my target area?
Use a map and make an estimation of the time your future customers will want to travel
to reach a company like yours. Most people prefer to do their daily shopping in the
neighborhood. In that case the target area is relatively small. But if you sell special
services or products, the target area might be larger. This is also the case if you sell
products to other companies.
3. How many members of my target group live (or visit) my target area?
Perhaps you have a special target group. Try to estimate what percentage of the whole
population belongs to your target group and again, refrain from being too optimistic with
your estimate.
4. What is the yearly expenditure on my product or service?
Sometimes your potential suppliers can be helpful; sometimes there is easy accessible
information available. If no information is available, you will have to do your own
research.
5. How many competitors do I have?
Again your potential suppliers can assist you, or such information may be available from
trade publications, classified telephone directories, or other sources.
6. Calculating the total market volume.
If you multiply the yearly expenditure by the number of people in the target area, you
will find the total market volume of this area. You have now made an estimation of the
possible total turnover for your company.
7. Calculate your own market volume
Now based on your analysis of the market and your target group’s need and requirements
and given the nature of your marketing strategy, estimated what your share of the total
market will be. Be realistic!
6

7. Of course these calculations are far from exact. But making them will give you some idea
about possibilities and opportunities. If you have made an overview of the weak and
strong points of your competitors, you may find new markets and in any ease get a clear
view of your unique selling points.
Further discussion on my target group.
If no information is available, or you want to find more qualitative information, you will
have to set up your own inquiry.
For future entrepreneurs this can be done just by thinking of visiting competitors. The
main question that will need answering then is: what do my customers want from me?
Existing entrepreneurs can do research in their own enterprise by making a few notes on
each customer. To avoid less of time, it is use useful to t up and copy some kind of form
before you start doing this.
Perhaps, you can ask some customers one or two simple questions, like how they came to
know your enterprise, in what area they live? Etc. the point is that you should get a clear
view of your target group. Another possible subject could be whether your marketing-
mix (product, price, place and promotion) is the right one for your target group. It is also
important to take a close look at your (future) competitors. In which way are they better
or worse? Start by making a list of competitors. The telephone directory and the local
newsletter will provide you with the addresses. Then define what can be important selling
points which they have in your line of business.
To satisfy your customers, improve your sales and make a profit you need to find out:
*what product or services your customers want?
*what price your customers are willing to pay?
*at what place your business should be so you can reach your customers.
*type of promotion you can use to inform your customers and attract them to buy your
products or services.
7

8. These are called the fours P’s of marketing. They all start with a P: Price, Place, Product
and Promotion. So they are easy to remember. The four P’s of marketing are the stepping
stone between the business and your customers. To reach your customers and increase
your sales you will need to learn about and use the four Ps’ of marketing. All four Ps’ are
very important and must be strong. If one or more Ps’ are missing, it becomes risky to
satisfy your customers and improve your sales. Satisfied customers will come back to buy
more from your business and will tell other people to buy from your business. Let’s face
each P one at a time.
1. Product:
To be successful in business, you must have the products and service that your customers
want. This is called product and it is the first P of marketing i.e. it is the first stepping
stone.
(I) Find out what customer need.
Customers buy goods and services to satisfy different needs, for example
 Cold drinks satisfy a need to feel cool in hot weather
 Bicycle satisfies a need for transport.
 Radios satisfy a need for news and entertainment
 Clothes satisfy a need to wear something comfortable and a need to feel attractive.
When you understand customers’ needs, you can decide what goods or service to
provide. For example, if a customer wants to buy biscuits for your store and they are out
of stock, buns can be a substitute for those biscuits that are out of stock because in this
case, the customer needs something for tea so buns satisfy that need. A successful
business finds out what customers want and need. Then the business provides the
products and services that satisfy that need of their customers. Because you cannot risk
selling what your customers don’t need.
8

9. Sometimes customers change their needs and wise thing to do is to listen to what your
like and do not like. When their needs change, you too have to change your products and
services to satisfy the new needs. Do more market research. When you know what your
customers want, you can provide those products or services and increase your sales.
(ii) Provide what your customers want.
Modern Furniture ltd and the other carpenters have a big problem. They all were making
the same kind of chairs for many years. Many of them have a habit of copying each other
and because of this each business sells very little.
Customers want to look at different products so that they can choose what they like best
For example
• Some customers want a different design
• Some customers want high quality and are willing to pay extra for that
If you always provide products or services of high quality, customers will trust you and
your business.
Remember: customers are the most important people for business. Always keep your
eyes and ears open to understand their needs. Make sure you provide the products or
services the customers want not what you want because you are not the customer.
Often ask yourself these kinds of question:
 Do I have the products customers want?
 Why did I decide to see these products?
 What products or services do I sell?
 Do any of my products not sell well?
 Do I keep products that do not sell well?
If the answers to the following questions tell you that customers want different products
or services, you can:
Make or sell completely new products or
9

10. Improve what you already make and sell by changing something about your product. For
example: the design, comfort, colour, size, customer service and the guarantee.
If you sell products which need packaging, you can also change the packaging.
Packaging protects your products and makes them easier to handle. Packaging adds to
your cost. But packaging can make your products more attractive and help you increase
your sales.
You may decide that the products and services other businesses provide are much better
than the products or services you can afford to make or sell. The changes you would have
to make to your products are too big and would cost too much. When this happens, you
may decide to stop selling that product. By doing market research, you can decide on a
better product or service for your business to sell.
1. Look for new ideas
Your products may not sell very well. Lots of other businesses may sell the same
products. Customer may not want to buy your product any more. If the products you sell
do not make much profit, think of new ideas, here are some examples:
 If you only make and sell household furniture,
• Find new customers such as schools and offices by selling desks, helves or office
furniture.
 If you make bread
• Find more customers such as restaurants, hospitals and schools.
 If you are selling vegetables and fruit
• Think what new products you can make, customers prefer to new products.
Before you start making new products, make sure you do market research:
 Think of ideas and ask others. Get as many ideas as possible.
 Find out which of those ideas can be made into products that customers would
like and would be willing to pay for
 Make sure there are enough customers who want your products.
10

11.  Make sure that your market gives your business a high enough profit
2. Price
This is the second P of marketing. To set the price can be difficult but is very important.
Your business may have very good products or services, but if your prices are wrong, you
will not sell much.
When you work out a price on a product or a service, you need to know how price cost,
and profit work together.
COST + PROFIT = PRICE OR PRICE – COST = PROFIT
$ 7 + $3 = $10 $10 - $7 = $3
You total profit from sales depends on:
 How much profit you make on each product or service
 How many of each product or service you sell
Sunshine dairy have tried both high and low prices:
 When they put a high price on chocolates, they make a big profit on each
chocolate.
But at that price they sell one or two chocolate a day
 When they put a low price on those chocolates, they make a small profit on each
chocolate.
But at that price they sell many cakes a day.
The number of products sold X profit per product = Total profit
E.g. 1 chocolate * $5 profit per chocolate = $5 total profit for chocolates per day
5 chocolates * $2 profit per chocolate = $10 total profit for chocolates per day
11

12. So, you can make a big total profit on a low price. It all depends on how many items of a
product you sell and how much profit you make on each item.
How to set your prices
In general, you prices must be low enough to attract customers to buy and high enough to
give your business a profit.
You must have certain information before you decide what prices to change your
customers. To set prices you need to:
1. Know your costs
2. Know how much money the customers are willing to pay
3. Know your competitors’ price
4. Know how to make your prices more attractive
1. Know your costs
You must know the total costs of making and selling each product or service. The total
costs include materials, labour, rent, electricity, transport and all other costs in your
business. To make a profit, your price must be higher than your total costs for that
product. E.g. the total costs of making one meat pie are $2. To make a profit I must sell
each pie for more than $2.
A price lower than the total cost gives you a loss e.g. $1 -$2 = -$1: $1 = loss. A price
higher than the total cost gives you a profit e.g. $3 - $2 = $1: $1 = profit
2. Know how much your customers are willing to pay
Customer must be willing to pay your prices. If you set a price which is too high, you will
soon know because you will sell very little or nothing, e.g. Sunrise restaurant are
planning to sell a meat pie for $3.50 and they asked customers. Almost all of them said
$3.50 is too much money to pay for a meat pie. Many of them said they would not buy a
meat pie if it costs more than $$3.25. Sunrise restaurant now know the price for meat pies
should be somewhere between $2.00 and $3.25:
12

13. $3.25 is the price the customers are willing to pay.
If the price the customers are willing to pay is lower than your costs, try to cut your costs.
If you can not cut your costs, find another product or service to sell.
3. Know your competitors’ prices
Find out how much competitors charge far the same or similar products or services to
yours. In general:
 If your prices are lower than your competitors; you may attract more customers to
buy from your business.
 If your prices are higher than your competitors; your customers may buy from
your competitors
Sunrise restaurant (above) found out that most competitors charge $3.25 for meat pies.
There may be some special reasons to why you charge or lower prices than other
businesses
You may want to charge a lower price, for example!
 If your product or service is new and people do not yet know about it.
 If you want to attract new customers.
You may want to change a higher price, for example:
 If customers feel that your product or service is better than your competitors
 If you provide some extra service such as longer opening hours, free delivery or
good guarantee.
Sunrise restaurant has not decided what price to charge for a meat pie. It is thinking of
charging $3.00. If customers buy from other places they have to pay $3.25
4. Know how to make your prices attractive
In the end, Sunrise restaurant decided on a price of $2.99 for the meat pie. $2.99 sounds
much less than $3.00, even there is only one cent different.
13

14. To attract customers to come to your business, you can sometimes use special offers-
even with low profits. When your customers come for the special offers, they often buy
other products as well.
Customers do not like to find the same special offers each time they visit your business.
So change your special offers often.
When you begin to sell a new product or service, you want to attract people to try it. You
can set a low introductory price that only gives you a small profit for the first few weeks
that you sell the new product. If customers like the product, you can slowly increase the
price so that it gives you a higher profit.
A discount also means a lower price. You can get a discount from a supplier. You can
give a discount to a customer.
Here are some examples:
 If a customer buys a large quantity, you can offer a quantity discount
 If a customer pays cash, you can offer a cash discount
 At certain times of a year, you can offer a seasonal discount
3. PLACE
The third P in marketing is called Place. You business may have good product at prices
that customers are willing to pay but sales may still be low. The reason may be that
customers do not know where to buy your products or services which is the place. Place
means location- where your business is. Location is especially important for retailer and
service operators who need to be where their customer are.
Place also mean different way of getting your products or service to your customers. This
is called distribution. Distribution is especially important for manufacturers.
To sell well, most retailers and service operators need to be where their customers are.
Good places for retailer and service operators are where many people pass by or where
many people live.
14

15. NB. Make sure the business is not where there are too many other businesses selling the
same products that you sell.
For many manufacturers, it is not always important to be near their customers. It is often
more important to have:
Cheap rent or land
Good and easy supply of raw materials
Most manufacturers do not have their businesses in the business centre.
If your business is not where your customers are, you must find to get your product
where it is not where it is easy for customers to buy. This is called distribution.
Distribution is particularly important for manufacturers. There are different ways to
distribute your products to your customers:
You can sell directly to customers who use your products. This is called direct
distribution.
You can other businesses to sell your goods for. Those businesses are mostly retailer or
wholesalers. This is called retail distribution and wholesale distribution.
Direct distribution: this means selling your products directly to customers who use
them. When you your products directly to customers who use them, you can talk to them
and find out what they like, want and can afford, so direct distribution is most useful for
those manufacturers who make products to each customers’ order. But direct distribution
takes and can be expensive for your business. For example, cost of transport, wages or
salary for time spent selling or delivering goods to customers. Retail distribution: means
selling your products to shop and stores who then sell to the customers who use the
products. Retail distribution is useful for those manufacturing businesses that make
products in large quantities. Retailers often reach more customers in a larger area than
your business can do on its own. When you sell your products to retailers you reach more
customers, your sales may increase and your business can grow.
15

16. Retailers can do a lot of work that your business has to do on its own if you sell directly
to the customers who use your products. For example retailers:
 Keep in contact with your customers. This gives you more time for production
and other activities.
 Stock your products, this helps your business to have less money tied up in stock
 Help promote your products by advertising, etc.
Because retailers do a lot of work for your business, you have to change them a lower
price than you would charge the customers who use your products. But retailers normally
pay you immediately when they get your products. Selling products to retailers also
means that
 You may lose contact with the customers who use your products. You may not
always know exactly what they like and want.
 You products may not be promoted enough. Retailers often sell your competitors
products too.
Retail distribution is most useful for your business if you make goods in large quantities
and you
Make standard products which normally do not need a lot of contact with customers
about design, colour, size, etc, for example, hair oil or shampoo
Make low priced products that customers buy often- for example making soap
Have many customers and it take a lot of time to stay in contact with each customers- for
example making standard cups and plates
Have customers in large area so that it is difficult, takes time and is expensive to reach all
of them- for example, making farming equipment.
Retail distribution:
Manufacture - Retailer – Customer
Makes the product buys and sells the product uses the product
16

17. PROMOTION
Your business may be in a good place, have good products at prices that customers are
willing to pay but your sales may still be low because you do not tell people about your
business and what it can offer. This is called Promotion and is the fourth P of marketing.
Promotion means informing and attracting the market to by your products or services. Do
not sit and wait for customer to come to you. Do promotion, sell more and increase profit
by:
 Advertising- making customers interested
 Sales promotion- getting customers to buy more
 Publicity- getting free promotion
 Improving your skills as a salesperson
(i) Advertising: advertising is giving information to your market to make people
more interested in buying your goods or services. Some ways of good
advertising for your business without spending a lot of money
 Signs:
Use signs so that people know and remember the name of your business, what it sells,
where it is when it is open, and so on. Use clever words to make more and buy. Bright
colours clear writing and or picture or symbol will make more people see your signs. Do
not put too much information on your sign. It is difficult to read a sign with a lot of
information. It is a good idea to find a good sign maker to help you. Put the signs where
people can see them, for example, a window, door, wall, roof, etc.
 Boards posters and handouts
Use boards, posters and handouts to tell customers about special offer, discounts, new
products and so on. You can use a cheap paper or even chalk and a chalkboard. Write on
the boards, posters, and handouts and using the information from the market research, put
the posters where many people can sell them. Ask your customers to give your price lists
and specials to their friends and other people who may be interested in your products or
services.
17

18. Your sales must be high enough to pay for the advertising costs. Advertising which does
not increase your sales is a waste of money and time, leave it.
(ii) Sales promotion: it is everything you do to make customers buy more when
they have come to your business. You can do it in many different ways.
Displays: keep your business well organized, well lit, clean and fresh looking, attractive
and products being well displayed.
Display is the way you arrange products. Display is important for all business, especially
for shops and stores. Good display makes it easier for customers to see your products so
they can choose and buy. Some of the ideas on how to display goods to increase sales are:
1. Put your goods in groups
Put similar products next to each other. This makes it easier and quicker for customers to
find what they are looking for, e.g. put cleaning materials together.
2. Show the prices clearly
Customers want to know the prices of goods without having to ask you. You can show
the price near the product and it must be written clearly for customers to see.
3. Make special displays
Use special display to sell more of your regular goods, seasonal goods or goods. You can
also use special displays for goods which have been selling slowly and goods which are
slightly old or damaged.
You can also let your customers taste or try new products so as to make them want to
buy. Or have a competition and offer a price, e.g. BUY for $50 or more and win a set of
pots. You can demonstrate by showing customers to use your products e.g., solar stove,
sell products that go together e.g. torches and batteries.
In making sales promotion:
 Be creative, use your own ideas and try something different
18

19.  Keep customers interested. Change the type of sales promotion often and only use
each for a short time.
 Do not use too many types of sales promotion at the same time, customers may
feel that you are forcing them to buy,
(iii) Publicity. It is a free promotion through an article in a newspaper or
magazine which tells people about products and services. The article promotes
your business. Good publicity increases your sales.
It is not easy to get publicity for your business. You can write an interesting letter to a
local newspaper, magazine or radio and describe what your business does and how it
serves the community. If they think they can make a good article about your business
they might come and interview you. You cannot control what someone writes about
business. Make sure you do not get bad publicity.
(iv) Improving you skills as a salesperson
You have attracted customers through good advertising, good sales promotion and good
publicity but your products are not yet sold. How well you will sell now depends on you.
Your skills as a salesperson can make the difference between success and failure.
To improve your skills as a salesperson and increase your sales you need to:
(i) Know your customers and their needs
(ii) Know how to treat your customers
(iii) Know your products and how to sell
1. Know your customers and their needs. Customers are different, for example:
 Some customers can never make up their minds
 Some customers are always in a hurry
 Some customers are careless with their money
 Some customers never have enough money
19

20. To be successful, try to understand and to get to know each customer. First find out what
the customer really needs:
 By listing and asking questions
Then satisfy the customers’ need
 By giving advices
 By offering suitable products or service
2. Know how to treat your customers
Successful salespeople try to sell things through the customers’ eyes. Treat your
customers the way you like to be treated when you are customers:
 Greet your customers, call them by their names
 Be polite and friendly so that customers feel welcome and enjoy visiting your
business.
 Dress well, look tidy and clean
 Offer your help
 Be patient, give customers’ time to ask questions and decide if they want to buy
 Be honest and trustworthy. Tell your customers the good points and bad points
about the product
 Avoid arguing with customers, make them feel right
 Thank and appreciate your customers for coming to your business.
Conclusion:
Marketing is very important in every business because the viability of the business can be
assessed through it. Marketing also highlights the following: Strengths, weaknesses,
opportunities and threats in the business. We cannot do business with marketing whether
in service or production enterprises.
BIBLIOGRAPHY
Michael A. Kamins PhD (2003).
Sales and Marketing. Published by: Listen and Live Audio, USA.
20

21. 21