1.3.5 understanding the consumer

Question 1

What is primary research?

Answer 1

Carried out directly, such as a survey, interviews, observations and tests.

Question 2

What are the benefits of primary research? [3]

Answer 2

• Firms research exactly what they need to, such as how much consumers are willing to pay
• More specific findings
• Advancement of technology has meant surveys can be carried out online at a low cost

Question 3

What are the negatives of primary research? [2]

Answer 3

• Could be expensive
• Time consuming

Question 4

What is secondary research?

Answer 4

Carried out by a third party, such as a government or an organisation.

Question 5

What are the benefits of secondary research? [3]

Answer 5

• Cheap
• Time efficient
• Access to wide pool of information

Question 6

What are the negatives of secondary research? [3]

Answer 6

• Might not be exactly what is required
• Might be outdated
• May contain inaccuracies

Question 7

What is qualitative data?

Answer 7

A description, such as an opinion or a general attitude towards a product. Can provide information on consumer satisfaction and help a firm focus on products that consumers want.

Question 8

What is quantitative data?

Answer 8

Numerical and involves statistics.

Question 9

What does a larger sample size mean?

Answer 9

It lowers the margin of error, since there is a wider range of opinions. This makes the research more representative.

Question 10

What is market segmentation?

Answer 10

When a market is divided into groups of similar consumers, such as by needs or characteristics.

Question 11

What are some different examples of market segments? [3]

Answer 11

• Geography
• Demographic
• Gender

Question 12

What does segmenting the market allow a firm to do? [3]

Answer 12

• Gain better opportunities to grow
• To promote their goods and services more effectively
• To meet consumer needs better.