Is there a market for our business idea? Market Research

What do we need to know? Is there interest in a product like this? Who might be interested in buying it? How many customers might want to buy it? What specifications should it have (styles, shapes, colours etc)? Could we sell it and make a profit?

Primary Research Obtaining data that did not previously exist. Consumer surveys Interviews Focus groups

Target market Who is this product aimed at? Will influence primary survey methods and sampling

Why primary research? Data collected directly applies to the research Only the business conducting the research has access to it. Can be advantageous. Secondary sources may not be available

Problems of primary research Can be costly in terms of time and money Samples may not represent the target population Poorly worded and confusing questions will lead to low quality findings

Closed questions Respondents are limited in how they can answer a question. Which of these colours do you like best, blue or yellow? Create QUANTITATIVE data (easy to graph and analyse). Questions can begin ‘Which’ ‘What’ ‘When’ etc

Open questions Respondents can answer however they want. Why do you like ice cream? Creates QUALITATIVE data so hard to display in charts/graphs Generates a deeper understanding than closed questions. Questions may begin ‘Why?’

Reliability & Validity Reliable - Would get the same results if the research was repeated. Validity - The data collected is accurate and representative.

Sampling Generating a small group of respondents that accurately represent the entire population Larger samples are more representative, but involve more time and cost

Sampling methods Random sampling - No bias as every person has an equal chance of being selected. But, assumes all members of the population are similar. Stratified random sampling - The sample is divided into groups of similar types, then random selection takes place.

Sampling methods Quota sampling - The population is divided into groups with similar characteristics. Then a set number from each group is contacted (not randomly).

Secondary research Data that already exists Data originally collected for another purpose, but can be useful. Examples include news stories & statistics produced by NIS (eg school enrollment).

Why secondary research? Can be quick and easy to collect Can be a low cost method of data collection Helps collect of backgound data

Problems of secondary research Data was created for another purpose and so may not be exactly what is required Data may be out of date Data may include bias eg news stories