1. MARKET RESEARCH

2. CH. 6: MARKET RESEARCH  A business must satisfy the needs of its customers to succeed  To find out what customers need/want  Businesses conduct Market Analysis

3. CH. 6: MARKET RESEARCH  What is a Market?  A group of people or companies who have a demand for a product or service and willing and able to buy it  Target Market  A group of customer of interest to you/the business  Focus of your company’s efforts  Need to know as much as possible abut them

4. CH. 6: MARKET RESEARCH  Market Segments  Sub groups of buyers who have similar characteristics  Consumer Markets are segmented as:  Geographics – Where consumers live  Demographics – Personal characteristics  Psychographics – Social/Psychological experiences

5. CH. 6: MARKET RESEARCH  How do we choose a Target Market?  Determine how many potential buyers are in your segment  Determine if the segment is reachable  Determine if the segment is responsive ***Multiple Target Markets can be chosen…However, its often best to choose the market with the easiest point of entry. Typically, these customers have a problem that CAN be solved***

6. CH. 6: MARKET RESEARCH  Research Process  Step 1: Identify Information Needs  What kinds of information do you need?  Step 2: Obtain Secondary Resources  Information already collected by someone else  Ex. US Census, Web Sites, etc.

7. CH. 6: MARKET RESEARCH  Research Process  Step 3: Collect Primary Data - Information you collect yourself  Observations  Interviews  Surveys  In person surveys produce the highest response rates

8. CH. 6: MARKET RESEARCH  Research Process  Step 3: Collect Primary Data (cont.)  Customer demographics  Would potential customers purchase your product/service…why/why not  How much would customers purchase  When would customers purchase  How would customer like to find the product/service  What do customers like about competitors

9. CH. 6: MARKET RESEARCH  Research Process  Step 4: Organize Data  Categorize data – By answer/demographic/etc.  Create charts or graphs to depict results  Data will help you refine your market analysis and serve as the basis for the market plan

10. CH. 6: MARKET RESEARCH  Research Process  Step 5: Analyze Data  Is there a market for the product/service  How big is the market  Will the industry support the business  Do competitor products reveal anything about the customer demand  What do customers predict the demand will be

11. MARKETING RESEARCH - SURVEYS  Define Problem  When a problem is defined – Objectives can be created to answer the problem  Objectives: Ex. Customer satisfaction / Distance / Etc.  Survey Questions should be based upon your objectives  Ex. Determine customer Satisfaction  Rate your satisfaction with company X on a scale of 1-5

12. MARKETING RESEARCH - SURVEYS  Validity  When a survey measures what it was supposed to  Examples?  Reliability  Producing nearly identical results in repeated trials  Asking the same questions to all respondents

13. MARKETING RESEARCH - SURVEYS  Types of Questions  Forced Choice – Predetermined answers  Open Ended – Respondents construct their own response  Writing Questions  Be brief and clear  Use the same rating scale for similar questions  Keep it short so it can be answered quickly

14. MARKETING RESEARCH - SURVEYS  For Your TWO Business Plan ideas  Identify your Problem for each  Identify your Objectives 3-5 needed for each  Identify your Questions that will help you answer your objectives  Remember Validity / Reliability  Surveys should be approximately 10 questions  2-3 Questions per Objective  Include ways to identify demographics  Gender / Grade / Age / Etc.