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Business Revision (C18)

Market research is the process of collecting, recording, and analyzing data about customers, competitors, and the market. It can be used to measure customer reactions to new products, prices, promotions, packaging, and distribution channels. The purpose of market research is to identify market features, reduce new product risks, understand customers, explain sales patterns, predict demand changes, and assess popular designs. Primary research collects first-hand data for a business's own needs, while secondary research uses existing research. Common primary methods are qualitative research like focus groups and quantitative research like surveys. Common analysis measures include the mean, mode, and median. Market research aims to reduce bias and improve reliability.

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17 views

Business Revision (C18)

Market research is the process of collecting, recording, and analyzing data about customers, competitors, and the market. It can be used to measure customer reactions to new products, prices, promotions, packaging, and distribution channels. The purpose of market research is to identify market features, reduce new product risks, understand customers, explain sales patterns, predict demand changes, and assess popular designs. Primary research collects first-hand data for a business's own needs, while secondary research uses existing research. Common primary methods are qualitative research like focus groups and quantitative research like surveys. Common analysis measures include the mean, mode, and median. Market research aims to reduce bias and improve reliability.

Uploaded by

Kristina Trần
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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Chapter 18_Market research

Market research – the process of collecting recording and analyzing data about customers, competitors,
and the market

Market research can be used to measure customer reactions to:

- New products
- Different price levels
- Alternative forms of promotion
- New types of packaging
- Online distribution

The purpose of market research:

1. Identify the main features of the market


2. Reduce the risks of new product launches
3. Identify consumer characteristics
4. Explain patterns in sales of existing products and market trends
5. Predict future demand changes
6. Assess the most popular designs, promotions, styles and packaging for a product

Primary research – when businesses collect first-hand data for their own needs

Advantages Disadvantages
+ Up-to-date information + Expensive
+ Relevant information (not available to + Time-consuming
competitors) + Doubts over accuracy & validity
+ Provide direct feedback from customers

Methods of primary market research:

1. Qualitative – understand opinions and motivations


Ex: focus group, open questions, observation
2. Quantitative – generate numerical data to get effective statistics
Ex: survey, other data collecting techniques
3. Interview
4. Focus groups

Secondary research – gathering information from research that has already been conducted

Advantages Disadvantages
+ Inexpensive + Doesn’t provide detail information
+ Provide a market overview with some data on + Data is also available to business competitors
competitors + May be outdated
+ May be quicker to carry out
Sampling – the process of selecting a group of respondents from a larger population

Sampling bias -

when a sample is not a good representation of the whole population

Limitations:

- Sample may be too small


- Risk of sampling bias
- Inappropriate method of sampling

Reliability of data collected:

1. Sampling bias
+ Time and cost constrain make it impossible to question the entire target market which leads to
biased answers
+ Higher the sample size, more accurate the results are likely to be
2. Questionnaire bias
+ This may occur when there are many leading, misunderstood questions asked -> the
respondent to answer in a certain way -> inaccurate results
3. Other forms of bias
+ The respondent may not be truthful

Analysis of quantitativedata:

Average Uses Advantages Disadvantages


measur
e
Mean + Used as an indicator + Include all the data in its + Affected by 1 or 2 extreme
of likely sales levels per calculation results
period -> determine re- + Widely used and easily + Usually not a whole number
order levels understood
Mode + Could be used for + Easily observed and no + Doesn’t consider al of the
inventory ordering calculation is necessary data -> can’t be used for
purposes + The result is a whole number further statistical analysis
and easily understood + More than 1 modal result ->
confusion
Median + Could be used in + Less influenced by extreme + Calculation from grouped
wage negotiations results than the mean -> more data is complicated
+ Often used in appropriate than mean + Even number means the
advertising value is approximated
+ Can’t be used for further
statistical analysis

Interpretation of information presented in:

1. Tables
2. Pie graphs | Angle of section = (value 1 section / total all section) * 360 |
3. Line graphs
4. Bar charts

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