Market Research Stage 6 Business Studies

Success depends on a lot of things, but when you have information about a particular market segment, a geographic area, or customer preferences, you'll be better prepared to make the decisions that can make or break your business

MARKET RESEARCH PROCESS Market research is the systematic collecting, recording and analysing of information related to the marketing of goods and services.. The main steps involved are: A. Determining information needs B. Data collection C. Data analysis and interpretation.

Determining information needs This is deciding the type of information that will be most useful to the business. Begins with identifying and defining the problem e.g. 'Sales of a product are falling so the reason for this problem must be found.' Research is then necessary to identify what type of information is appropriate for solving the problem. There are three main types of research:.

Types of Research Exploratory research - used to clarify the problem Descriptive research - used to describe things about the problem Causal research - used to determine cause- and- effect relationships Example, falling sales may be a symptom of an underlying problem related to price or product promotion. Exploratory and descriptive research can assess the effect of competing products, the success of promotions and the characteristics of the market, Causal research can determine the effect of a price change.

Data Collection The major part of designing market research is deciding what data needs to be collected. Two main types of market research data: i. Primary Research and ii. Secondary Research Primary Research is data is collected specifically for the problem, and requires original data. Secondary Research is research already published, and is the cheapest form of research because the data already exists for your acquisition (aka desktop)

Primary Collection The main sources of primary research are: Observational research. The researcher watches people's behaviour in an area such as a shop. It is useful for gathering data from people who would not ordinarily volunteer it Focus groups. Involves a group of people selected because they match the characteristics of the target market. People are shown the product and guided through a process of collecting information on the product such as its packaging, size and advertising 3/6

Primary Sources Cont. Experimental research. This tests responses by changing aspects of a product to prove a cause- and-effect relationship Surveys. A popular way of collecting data. Surveys need to be carefully constructed. Various styles of questions can be used as well as different ways of collecting information (phone, personal interviews, mail and so on).

Problems with primary research Primary Research has two problems: 1. Very expensive to collect 1. Usually takes a long time to collect.

Secondary Research Secondary research may be collected in two ways: Externally, when a business uses a market research firm Internally, when the business conducts the research itself.

Internal Data Collection Data that has been collected and published previously. Because it is widely available and comparatively cheap, many researchers begin with secondary data. Secondary data can be collected from: Internal sources are mainly: o Accounts departments, for details of customer sales o Marketing departments, for details of sales reports and sales distribution.

External Data Collection : 1. The media, such as newspapers and magazines 2. State and federal governments, which collect large amounts of data (the Australian Bureau of Statistics is an example) 3. Trade associations 4. Company reports 5. Research firms 6. The Internet.

Data Analysis & Interpretation Once data is collected, it must be interpreted to make it useful. Researchers interpret findings, draw conclusions about usefulness and report outcomes to management. Data becomes information and makes it useful. Information is usually presented as a report to management. Decisions on how to use the research will then be made by management ( possibly in consultation with researchers)