3.2.1 The role of market research and methods used:
- Market-orientated businesses (uses of market research information to a business)
- Primary research and secondary research (benefits and limitations of each)
- Methods of primary research, e.g. postal questionnaire, online survey, interviews, focus groups
- The need for sampling
- Methods of secondary research, e.g. online, accessing government sources, paying for commercial market research reports
- Factors influencing the accuracy of market research data
3.2.2 Presentation and use of market research results:
- Analyse market research data shown in the form of graphs, charts and diagrams; draw simple conclusions from such data
Market research
“The action or activity of gathering information about consumers’ needs and preferences.”
So we can say that Market research is carried out to identify current and future consumer needs and wants
Accurate market research helps to reduce the risk of launching new or improved products.
Types of market research Orientation’s
Product-Oriented Business
This is where the business produces the product first and then tries to find a market for it. Their concentration is on the product – it’s quality and price.
Business will produce a product then try to convince people to buy it.
Market-Orientated business
This is where business will conduct market research to see what consumers want and then produce goods and services to satisfy them. They will set a marketing budget and undertake different approaches of research to identify consumer tastes, spending patterns, development opportunities and market conditions.
Business will perform market research to discover consumer needs and wants then develop a product that meets their needs and wants.
You can watch this lesson in video format
Types of research
Primary research
conduct yourself (or hire someone to do for you.)
Collection of original information by directly contacting with potential or existing customers. It is a costly and time consuming effort which will aid in reducing risks for business.
- collecting primary research
- Questionnaires or online surveys
- Focus
- Phone or face to face interviews
- Observation
- Postal surveys
The advantage of the primary research information, is that the data has been collected personally. Therefore, it relates directly to the researcher’s study.
The disadvantages of primary data are that is expensive to collect and take a long time to process.
Secondary research
Information that has already been collected by another organisation and is available for you to use.
This research has already been compiled, gathered, organised and published by others. It includes reports and studies by government agencies, trade associations or other businesses in your industry.
Examples:
- Public sources
- Commercial sources
- Departmental records
- Newspaper
- Internet
- Reports
- Statistics
For small businesses with limited budgets, most research is typically secondary, because it can be obtained faster and more affordably than primary research.
Advantage:
- Ease of Access and low cost
Disadvantages
- Not Specific to Researcher’s Needs
- Maybe incomplete Information
Market research is not always accurate
- Questions could be biased
- Sample may just give their own opinions
- Size of samples may be too small
- Secondary research information can be outdated or inaccurate
- Participant may not be honest
Presentation of market research
Research can be presented using:
- Tables
- Tally charts
- Graphs
- Charts
You can watch this lesson in video format here
Use of market research
Why business will use market research?
- Identify marketing opportunities and problems
- generate, refine and evaluate potential marketing actions
- monitor marketing performance
- improve marketing as a process
- reduces uncertainty
- reduces risk
- helps focus decision making
What is sampling?
Sampling means getting opinions from a number of people, chosen from a specific group, in order to find out about the whole group.
It is getting selected people to respond to market research questions such as interviews and questionnaires so you can collect data which helps you to get to know their opinions, interest and so on.
Random sampling
Samples are chosen randomly without reasons
a way of selecting a sample (random sample) from a statistical population in such a way that every
possible sample that could be selected has a predetermined probability of being selected.
Quota sample
People are selected based on certain characteristics for example age or income.
A sampling method of gathering representative data from a group. As opposed to random sampling, quota sampling requires that representative individuals are chosen out of a specific subgroup. For example, a researcher might ask for a sample of 100 females, or 100 individuals between the ages of 20-30.
Quantitative and Qualitative
Factual information is called quantitative data. Information collected about opinions and views is called qualitative data.
Quantitative data are anything that can be expressed as a number, or quantified. For Examples scores on achievement tests, number of hours of study, or weight of a subject.
Qualitative data cannot be expressed as a number. For example gender, social economic status, religious preference are usually considered to be qualitative data.
Both types of data are valid types of measurement, and both are used by organisations. Only quantitative data can be analysed statistically.
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