ROLE AND IMPORTANCE OF MARKET RESEARCH Process of collecting and analyzing data for a good/service...
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Transcript of ROLE AND IMPORTANCE OF MARKET RESEARCH Process of collecting and analyzing data for a good/service...
MARKET RESEARCH
ROLE AND IMPORTANCE OF MARKET RESEARCH
Process of collecting and analyzing data for a good/service in a market
Analyzing consumer reaction to eg. Price changes, forms of promotion, packaging
Impacts marketing decisions
IMPORTANCE OF A RESEARCH PLAN
Reduce risk of new product launches Predict future changes Explain patterns in sales of existing
products and market trends Assess most popular designs, flavors,
styles, promotions and packages
STAGES OF MARKET RESEARCH
Management problem identification Research objectives Sources of data (primary, secondary) Sampling (probability, non
probability) Research techniques (focus groups,
surveys, in depth interviews, observation)
Analysis and presentation of results
MANAGEMENT PROBLEMIDENTIFICATION
Most important step in process Clear idea of purpose of research of
problem to be investigated
What is the size of the potential market for our product?Why are sales falling?
How can we challenge our competitors?
MARKET RESEARCH OBJECTIVES
Must tie in with original problem Set to collect all information needed
to solve problem
How many people are willing to buy our product?
If we advertise via newspaper, what will be the impact on sales and market
share?
SOURCES OF DATA
Primary: original data gathered from people in target market
Secondary: use and analysis of data that already exist
Secondary data may be more beneficial and should be undertaken first!
Advantages: cheap, quick, identifies nature of market/helps plan for primary research, comparison of data from different sourcesDisadvantages: out of date, unsuitable/irrelevant, inaccurate, not available for new product developments
SECONDARY SOURCES OF DATA
Government publications: social indicators report, economic trends, annual abstract of statistics, family expenditure survey
Local libraries and local government offices Trade organizations: society of motor traders,
furniture retailers assoc, engineering employers federation
Market intelligence reports: mintel, keynotes, business monitor intl, euromonitor
Newspapers and specialist publications: marketing journals, financial times
Internal company records
SAMPLING
Probability and non probability sampling
Sample size: larger samples give better results
Cost and time to consider
PROBABILITY VS NON PROBABILITY SAMPLING
PROBABILITY SAMPLING NON PROBABILITY SAMPLING
Simple random sampling: each member of population has an equal chance of being included in sample
Convenience sampling: sample chosen based on ease of access
Systematic sampling: sample is made up of every nth item from population
Snowball sampling: refer from friend to friend
Stratified sampling: sample is taken from different groups/layers/stratas of population (different opinions)
Judgemental sampling: sample made up of suitable persons (timely)
Ad hoc quotas: any person is chosen to make up pre-set quota
RESEARCH TECHNIQUES
Quantitative: number of consumers who may buy a product and in what quantities
Qualitative: discovering motivational factors behind consumer buying habits
QUANTITATIVE RESEARCH
OBSERVATION: how consumers behave
TEST MARKETING: testing limited quantity of new product on the market
CONSUMER SURVEYS: directly asking consumers about preferences or opinions
Who to ask? : sample must represent population
What to ask? : clear, logical questions
How to ask? : self completed questionnaire or direct interview
How accurate is it? : sampling bias, questionnaire bias, untruthfulness
QUALITATIVE RESEARCH
FOCUS GROUPS
PRESENTATION OF RESULTS
Bar charts Histograms Line graphs Pie charts
LIMITATION OF MARKET RESEARCH
90% of products fail after they have been launched! PROBLEMS WITH PRIMARY DATA Reliability of data Human behavior: untruthful, unpredictable Sampling and bias: sample may not represent
population (sampling discrepancy) Badly constructed questionnaires, leading
questions
PROBLEMS WITH SECONDARY DATA out of date, unsuitable/irrelevant, inaccurate, not
available for new product developments