Starter – read the following and answer the question below: What is Marketing? Developing products that customers want to buy Understanding the needs of customers Selling products at a price affordable to customers (and gives a profit to the company) Which of the above do you think is most important? – Justify your answer

What have we covered so far? – The economic problem – Business objectives – Stakeholders and CSR – The role of an entrepreneur – Entrepreneurial motives – Factors of production

1.3 – Next topic: Introducing the market – Demand (FLS) – Supply (FLS) – Price determination (FLS) – Price mechanism (FLS/ADK) – Understanding the consumer (ADK) – The competition (ADK)

1.3.5 – Understanding the consumer a)Primary and secondary market research data (quantitative and qualitative) used to quantify likely demand and gain insight into consumer behaviour b)Limitations of market research, sample size and bias c)Categorising consumers - market segmentation

Definitions Market research - the action or activity of gathering information about consumers' needs and preferences, as well as finding out what competitors are doing.

The Need for Market Research Write down and explain what is meant by each of the following (and why they are important to a business): Find out what customers want Reduce the risk of failure Understand current customer needs EXTENSION - Can you think of any other reasons businesses need to carry out market research?

Market Research Desk Research Collecting information from existing material. E.g. rivals’ published accounts, magazines, newspapers. Field Research Collecting and analysing information gained first hand, E.g. interviews, surveys.

Primary (field) Research Focus groups/observations Interviews Questionnaires Consumer panels (where a group of people meet together to discuss a product in detail) Experiments (e.g. samples of new products are given to consumers in supermarkets to test) Secondary (desk) Research Trade Press The internet e.g. Competitor information Government produced data

What type of research would be suitable and why? The possible success of a new chocolate bar. Whether to introduce a new style of watch which uses fashionable bright colours. Why the sales of a new sports shoe are falling. Whether to open a new restaurant

Advantages and Limitations of Primary Research What do we think?

Advantages and Limitations of Primary Research

Market research ‘gone wrong’ What happened? What mistake did they make?

Advantages and Limitations of Secondary Research What do we think?

Advantages and Limitations of Secondary Research

Paired Task The breakfast cereal challenge.

2 more key terms Quantitative - market research conducted where the results are numerical and can be analysed statistically. Qualitative – market research the examine opinions and feelings.

Plenary Explain why it is vital for a business to carry out market research on its competitors?