Market Research

Market research allows a firm to…. Anticipate changes in the market and customers tastes Keep ahead of competition Ensure their products/service meet customers requirements Ensure the correct price and promotions are set Ensure that the product/services is sold in the most appropriate places Attract new market segments

Information an organisation can get from doing market research can be ….. The size, and nature of its target market The age, sex, income level of customers The effectiveness of its selling methods Customers thoughts of products and prices What customers think of the advertising and promotions A test product and how it can be improved

The two market research methods These two methods are desk research and field research Desk research, this is carried out by a researcher using secondary information in the form of eg. Government reports or financial papers. This is produced by someone other than the researcher, eg. Newspapers. Field research, this is carried out by a researcher ‘in the field’ to obtain first-hand information for an organisation to use. The researcher goes out to the market and finds the information for themselves. This information is particularly for this specific business as it hasn’t been researched before. Eg. Questionnaires

Field research techniques Advantages Disadvantages Postal survey Its not expensive as it does not need a trained interviewer The response rate is low and some people don’t tell the truth. Telephone surveys A large number of people can be surveyed quickly Many people don’t like strangers asking questions over the phone because they feel its invading privacy

Sampling Random sampling, is when you are picked at total random like if you are chosen from a list and you get phoned to do a survey. Or when you were little and you got picked out the hat for being the first in the queue for lunch  Stratified sampling, is like if Scotland had 10 percent of the population who earned £50,000 a year, 40 percent of them earn £30,000 a year and 50 percent of them earn £20,000 a year, this would mean that if you asked 100 people then you would have to ask 10 people who earned £50,000 , 40 people who earned £30,000 and 20 people who earned £20,000 to make this a fair questionnaire. Quota sampling, this is like finding everyone who has a red car and asking them certain questions then finding people who have a 3 bedroom house and asking them questions.