Flashcards in Market research Deck (18):
Whats a market?
Businesses sell to customers in markets. A market is any place where buyers and sellers meet to trade products - it could be a high street shop or a website. Any business in a marketplace is likely to be in competition with other firms offering similar products. Successful products are the ones which meet customer needs better than rival offerings.
Why are businesses dynamic?
Markets are dynamic. This means that they are always changing. A business must be aware of market trends and evolving customer requirements caused by new fashions or changing economic conditions.
What is marketing?
Marketing is about identifying and satisfying customer needs.
Whats the first step of market research?
The first step is to gather information about customers needs, competitors and market trends. An entrepreneur can use the results of market research to produce competitive products.
Whats the first step for a new business?
The first step for a new business or product is to attract trial purchases.
What is market research?
Market research involves gathering data about customers, competitors and market trends.
Whats an example of marketing?
A new magazine may run special offers to get customers to try the first issue, hoping that repeat sales are generated. The magazine will soon close if customers fail to buy future issues. The aim of a special offer scheme is to convert trial purchases into repeat sales.
What are the two methods of collecting information?
Primary research (field research) involves gathering new data that has not been collected before. For example, surveys using questionnaires or interviews with groups of people in a focus group.
Secondary research (desk research) involves gathering existing data that has already been produced. For example, researching the internet, newspapers and company reports.
What is quantitative data?
Factual information is called quantitative data.
What is qualitative data?
Information collected about opinions and views is called qualitative data.
Whats the advantage of accurate market research?
Accurate market research helps to reduce the risk of launching new or improved products.
Why don't some business do primary research (field research)?
Some businesses opt out of field research and rely instead on the know-how and instincts of the entrepreneur to ‘guess’ customer requirements. They do this because market research costs time and money. Existing business can make use of direct customer contact to help them identify changing fashion and market trends.
What are market segments?
Most markets contain different groups of customers who share similar characteristics and buying habits. These collections of similar buyers make up distinct market segments.
How do submarkets lead to opportunities?
Breaking down a market into submarkets can lead to a business opportunity.
For example, a magazine publisher can target a specialist journal at one group of customers of similar age, gender, class or income.
Whats a market map?
Another tool used to help identify a business opportunity is a market map. A market map is a diagram that identifies all the products in the market using two key features.
Whats a competitive market?
A competitive market has many businesses trying to win the same customers.
Whats a monopoly?
A monopoly exists when one firm has 25% or more of the market, so reducing the competition.