Market Research and Consumer Behavior • Experiments: Testing variables to

Handout 1 measure consumer reactions.

Secondary Research Methods

Importance of Market Research
• Examples of secondary research
• Market research is vital for successful
methods:
business decisions. It helps
entrepreneurs understand the • Government Reports: Statistical data
following: and market trends.
• Identifies opportunities in the market. • Industry Reports: Analyses of market
trends and forecasts.
• Understands target audience and
customer needs. • Academic Research: Research papers
offering theoretical insights.
• Reduces business risks by making
informed decisions. Example: Tesla’s Market Research Strategy
• Helps in competitive analysis. • Tesla combined primary and secondary
research to understand customer needs
Example: Airbnb’s Use of Market Research
and market demand for electric
• Airbnb used market research to identify vehicles.
customer concerns about safety and
• Result: They identified concerns like
trust.
battery range and built features to
• Result: They introduced customer address these, becoming a market
reviews and verification systems, leader.
helping to increase adoption and trust.
Consumer Behavior in the Marketing Process
Types of Market Research
• Understanding consumer behavior is
There are two main types of market research: crucial for tailoring marketing efforts to
customer preferences.
1. Primary Research: Direct data
collection through interviews, surveys, • Helps identify consumer needs, desires,
experiments. and motivations.

2. Secondary Research: Using existing • Influences product development,

data from reports, databases, and pricing, and promotions.
government sources.
Example: Nike’s Targeted Advertising
Primary Research Methods
• Nike uses consumer behavior data to
• Examples of primary research methods: target different customer segments
based on their interests, such as
• Interviews: One-on-one conversations
athletes and casual users.
with target customers.
• Result: Tailored marketing campaigns,
• Surveys: Collecting data through
resulting in higher engagement and
questionnaires.
loyalty.
What are you trying to achieve in your o Product-specific markets: The
Research? market for technology, fashion,
healthcare, or any specific
• What are we hoping to learn from the industry.
research?
Market as Demand
• What sort of questions are we hoping
the research will answer?
 Markets reflect the demand for certain
• How do we intend to use the research goods and services. For instance, the
results? housing market shows the demand for
residential properties, while the job
Market market reflects the demand for labor
and employment opportunities.
The term market refers to the entire system of
potential buyers (customers) and sellers Defining Marketing
(providers) of a product or service, as well as
the conditions under which trade takes place. While the market refers to the arena where
It's a broad term that can be understood from exchanges happen, marketing is the structured
multiple perspectives: effort that businesses put into understanding
their market, communicating their value, and
Market as a Physical or Virtual Space driving sales.

 Physical Markets: These are places Marketing as a Process

where buyers and sellers meet face-to-
face to exchange goods or services.  Marketing is the process by which
Examples include local grocery stores, companies create, communicate, and
farmers’ markets, or shopping malls. deliver value to customers. It involves
 Virtual Markets: With the rise of the understanding customer needs,
internet and e-commerce, virtual designing products or services that
markets have become increasingly meet those needs, and persuading
important. These include online customers to choose their offerings
platforms such as Amazon, eBay, and over competitors'.
Alibaba, where buyers and sellers  Marketing is a broad discipline that
transact over digital platforms. spans several stages:
o Market Research:
Market as a Group of Buyers Understanding what customers
want, need, and expect.
o Product Development: Creating
 A market can also be defined as the
group of potential customers for a a product that meets market
product or service. This can be demands.
categorized based on: o Promotion: Communicating the
o Geographical markets: Local, benefits of the product or
regional, national, or global. service to the target market
o Demographic markets: Defined through advertising, public
by factors like age, gender, relations, and digital media.
o Sales and Distribution: Making
income level, and lifestyle.
the product available to
 customers in the right places, at
the right time.
o Customer Engagement:
Building and maintaining
relationships with customers to
foster loyalty and repeat
business.

Marketing vs. Sales

It’s important to note that marketing and sales

are different functions, although closely related:

 Sales is focused on directly generating

transactions (convincing the customer
to buy a product).
 Marketing is broader and more
strategic, focusing on creating
awareness, interest, and desire for the
product, so that the sales process
becomes easier.

The 4 Ps of Marketing

To better understand marketing, we can look at

its core framework, often referred to as the 4
Ps:

 Product: What you are selling. This

includes the product's design, features,
quality, and how it meets the needs of
your target market.
 Price: How much you charge for the
product. Pricing strategies are vital
because they affect both customer
perception and the profitability of a
product.
 Place: How and where your product is
distributed to customers. This can be
physical locations (like retail stores) or
digital spaces (like websites or apps).
 Promotion: How you communicate
your product’s benefits to the target
market. Promotion involves advertising,
sales promotions, public relations, and
personal selling.