Chapter 18: Market research Flashcards
Market research
Process of collecting, recording and analysing data about customers, competitors and the market
Purpose of market research
Identify the main features of a market
Reduce the risks of new product launches
Identify customer characteristics
Explain patterns in sales of existing products
Predict future demand changes
Asses the most popular design styles/product packaging
Primary research
Collection of first-hand data that is directly related to business needs
Secondary research
The use of existing data that was collected for another purpose
Usefulness of secondary data
Provides info about the market a business plans to enter
Helps identify key areas of market info
Provides evidence that is compared with primary data
Large samples increases validity/reliability
Easily accessible on the internet (saves time and money)
Many sources allows checks for accuracy
Limitations of secondary data
Data may be out of date
May not be specific to the problem
Not all data is available
Primary data is still required to gather specific info
Not easy to analyse
Main sources of secondary data
Governments
Trade organisations
Market research agencies
Company reports and accounts
Usefulness of primary data
Finding out data about brand new markets
To collect specific data
To gather qualitative data that supports quantitative data
To focus on market reactions to specific changes
To gain info from a particular target group of consumers
When data needs to be up-to-date
When data needs to be cross checked for accuracy (triangulation)
Primary data collection method
Questionnaires
Interviews
Observation
Test marketing
Focus groups
Limitations of primary research
Can be time consuming to collect
Selection of participants influences validity
Can be expensive to finance
New businesses may not have customers to get data from
Quantitative data
Data presented in numerical form
Qualitative data
Data presented in a written or visualised form
Sampling
Process of selecting a group of respondents from a larger population
Sample
A group of people taking part in a market research survey selected to be representative of the overall target market
Limitations of sampling
Sample may be too small
Risk of bias
Researchers may choose the wrong sampling method
