market research

Question 1

field research and examples

Answer 1

• Refers to first-hand (primary) information collected by a business for a specific purpose
• Focus Groups
• Personal Interviews
• Survey: telephone, postal, online
• Hall test
• Observation
• Test Marketing
• Social networking websites
• Internet
• Customer audit
• EPOS

Question 2

focus group

costs and benefits

Answer 2

• Detailed feedback can be given to the organisation
• Participants are more likely to give better feedback as they have agreed to take part
• Qualitative information can be difficult to analyse

Question 3

personal interview

costs and benefits

Answer 3

• Interviews allow the organisation to directly gain the views of
  customers
• Can clarify any questions to aid understanding
• It can be time consuming to carry out the interview
• Respondents may lie to get through the interview quickly

Question 4

telephone survey

costs and benefits

Answer 4

• Telephone surveys mean instant feedback can be given.
• Sometimes gains a hostile response from the person being called

Question 5

postal survey

costs and benefits

Answer 5

• Postal survey can be sent out to all customers (wide geographical area)
• Can target customers in selected areas
• Customers can compete the survey at a time that suits them
• Low response rate as often viewed as ‘junk mail’
• Cannot ask for clarification

Question 6

hall test

costs and benefits

Answer 6

• relatively inexpensive to carry out
• Feedback can be gathered instantly
• As customer is giving feedback directly, they may not want to give a negative response

Question 7

observation

costs and benefits

Answer 7

• Can provide accurate quantitative information
• Customers will act naturally as they do not know they are getting watched
• There is no direct contact with customers to ask about their actions

Question 8

test marketing

costs and benefits

Answer 8

• Once feedback is received changes can be made to the product prior to launch
• Not representative of the wider market as only a small area gets to test the product

Question 9

social networking websites

costs and benefits

Answer 9

• Can gather large amounts of information quickly
• Can only gather information from those who use social media
• Comments are ‘public’ so anyone can read reviews including competitors

Question 10

internet

costs and benefits

Answer 10

• Customers can be surveyed across a wide geographical area
• Software enables easy analysis of the results
• Access to the internet must be available

Question 11

consumer audit

costs and benefits

Answer 11

• Customer trends can be identified
• Customers are paid so this can be an expensive method

Question 12

EPOS

costs and benefits

Answer 12

• Gathers information about consumer behaviour eg what is bought, how they react to changes in price or promotions
• Promotions can be tailored to the individual customer
• Expensive to set up
• If money-off vouchers are offered, it may lower profits

Question 13

desk research and examples

Answer 13

• Refers to second-hand information that already exists and which has been gathered for one purpose but then reused for another
  Examples
• Competitors website
• Online news articles
• Government publications
• Sales figures
• Review websites (Trip advisor)
• Social media posts/comments

Question 14

newspaper

costs and benefits

Answer 14

• Easily accessible as the information already exists
• May be biased
• Has been gathered for an alternative purpose

Question 15

advantages of desk research

Answer 15

• As the research has already been carried out, it is usually easy to obtain by looking in a newspaper,book or on a website
• It is usually cheaper and less time consuming to gather than Field Research, which saves the organisation money
• Decisions can be made quickly because the information already exists

Question 16

disadvantages of desk research

Answer 16

• Because this research was carried out for a different purpose, it is not as reliable as field research and might not be as useful
• Out of date/ not relevant as carried out long time ago
• The information might be biased, which could lead to wrong or incomplete decisions being made

Question 17

random sampling

Answer 17

• Randomly selecting people from a list e.g. a telephone directory
• Random sampling uses pre-selected respondents who must be interviewed
• Random sampling is expensive to carry out because specific respondents must be interviewed and contacted until they are available
• Random sampling reduces biased results because of method of selection of respondents
• Random sampling does not target any specific market segment.
• Random sampling can be expensive as a large sample is required

Question 18

quota sampling

Answer 18

• Sample that has been created to mimic the characteristics of a market
• Quota sampling is selecting people to question based upon certain characteristic e.g. age, gender or occupation
• Quota sampling is less expensive as the interviewer simply needs to find suitable respondents
• Quota sampling is harder to eliminate bias in the selection process
• Quota sampling is cheaper as less respondents are required

Question 19

how can market research be used by a business

Answer 19

• Size of the target market
• The age, sex, income and preferences of customers
• The effectiveness of its selling methods
• What customers think about the product/service
• The effectiveness of advertising and promotions
• What are the competitors doing
• A test product and how it can be improved