Theme 1.1.2 - Market Research

Question 1

What is product orientation?

Answer 1

Where a business develops products based on what it is good at doing d focuses more on the design, performance and quality of the product en making important marketing and production decisions

Question 2

What are the advantages of a business being product orientated?

Answer 2

• Can lead to increased economies of scale
• The business can focus on what it does best, making the product
• Allows the business to aim to invest in product efficiency and quality in order to give them

Question 3

What are the disadvantages of a business being product orientated?

Answer 3

• Lack of responsiveness to changes in the market
• Doesn’t always take into consideration customers needs/feedback

Question 4

What is market orientation?

Answer 4

Where a business focuses on responding to the customers needs and wants during marketing and production decisions rather than the design and quality f the product they are selling

Question 5

What are the advantages of a business being market orientated?

Answer 5

• Increases customer loyalty and satisfaction
• Higher chance of success if the needs and wants of the customers are met
• More likely to achieve product differentiation than a product orientated business
• Gives the aim to invest in product innovation

Question 6

What are the disadvantages of a business being market orientated?

Answer 6

• Consumer tastes/preferences are usually temporary
• Have to constantly adapt to changes in customer desires which can lead to being expensive

Question 7

What is primary research?

Answer 7

Primary research refers to research data that is collected first-hand for a specific research purpose

Question 8

What are the advantages of primary research?

Answer 8

• More up to date than secondary research
• Effective as it is focused on research objectives
• Provides more detailed/specific insights

Question 9

What are the disadvantages of primary research?

Answer 9

• Can be time consuming and as a result costly to run
• Risk of survey bias and meaning the research is not representative of the entire population

Question 10

What are some examples of primary research?

Answer 10

Interviews, surveys, questionnaires, testing, trials

Question 11

What is secondary research?

Answer 11

Secondary research involves using data that is pre-existing and has been collected by another person for a different purpose

Question 12

What are the advantages of secondary research?

Answer 12

• Quick and easy to collect
• Can provide the business with information/insights that are specific to the business
• Often is easy to analyse

Question 13

What are the disadvantages of secondary research?

Answer 13

• Research is not specific to the business
• The data could be out of date or inaccurate

Question 14

What is qualitative research?

Answer 14

Qualitative research is a form of market research involving opinions, attitudes, beliefs and aims to understand the customers reactions and how they may respond to a new product

Question 15

What are the advantages of qualitative research?

Answer 15

• Effective way of testing different elements in the marketing mix e.g. new branding
• Focused on understanding customers needs, wants and expectations
• Can highlights issues within the business that need addressing

Question 16

What are the disadvantages of qualitative research?

Answer 16

• Expensive to collect and analyse as it requires specialist research skills
• Based on opinions: the opinions in a sample group of people may not be representative of the entire population

Question 17

What is quantitative research?

Answer 17

A form of research that is concerned with/based on data and is based on larger samples, so therefore, it is more statistically valid

Question 18

What are the advantages of quantitative research?

Answer 18

• Data can be compared with data from other sources e.g. competitors and history
• Data is relatively easy to analyse
• Numerical data gives an insight to trends in the market

Question 19

What are the disadvantages of quantitative research?

Answer 19

• Doesn’t give any reasoning to the numerical trends
• Can be unreliable if the sample size and/or method is not valid

Question 20

What is sampling?

Answer 20

Sampling refers to gathering information from a small group of people in a specific group in order to find out about the whole group

Question 21

What is the advantage of sampling?

Answer 21

Marketers can draw out important information about their chosen market

Question 22

What is the disadvantage of sampling?

Answer 22

Quite expensive and time consuming

Question 23

What fundamental issues does market research need to be focused on?

Answer 23

• How big the market is
• How fast the market is growing and the market growth potential
• Who the existing competitors are and their share of the market
• How the market is divided into segments
• What kind of customers there are in the market, it is important to know their preferences in terms of when and where they buy, and the prices they pay

Question 24

What is market segmentation?

Answer 24

Market segmentation involves identifying different parts of the market where customers share similar wants and needs

Question 25

What is the key benefit of market segmentation?

Answer 25

The main benefit of market segmentation is it enables to focus their marketing efforts more accurately and develop products tailored to specific customer segments

Question 26

What are the advantages of market segmentation?

Answer 26

- Recognises that all consumers are not identical - Product and marketing activities can be altered to meet different needs of different groups of consumers and targeted more precisely - Less expensive and wasteful than marketing products at wide market segments - May increase loyalty if the customer feels that their needs are being met, which can lead to repeat purchase

Question 27

What are the disadvantages of market segmentation?

Answer 27

- Not everyone within a segment will behave in the same way - May be difficult to identify segments and consumers can belong to multiple segments at the same time - Segmentation requires more detailed market research which can prove costly (but beneficial) to the business - A segment may be identified but it may be too small and unprofitable to cater for

Question 28

How are company websites used to support market research?

Answer 28

Websites allow businesses to collect primary data more cheaply (e.g. tracking consumer searches and analysing customer reviews) as well as collecting secondary data about rivals (e.g. rivals and special offers)

Question 29

How are databases used to support market research?

Answer 29

Databases can be used to tore large amounts of customer information e.g. Tesco loyalty cards. Databases are also effective at collating customer email addresses so that targeted customers can be surveyed later via email

Question 30

How is social networking used to support market research?

Answer 30

Social networking focuses on gathering information about consumers via online social channels such as Twitter and Facebook. It is also useful s a method of running quick polls and surveys or tracking opinions about brands