Chapter 2

Market Research

Market Research
………………………………………………………………………………………………………………………………………………………
………………………………………………………………………………………………………………………………………………………..

. Market research data can be used for the following specific purposes

1. ………………………………………………………………………………………………………………………………:

● Businesses will benefit if they can clarify the specific needs and wants
of consumers. In order to design products that are likely to sell
● The data that market researchers gather need to be as comprehensive
as possible so that all the needs and wants are identified. This data will
be qualitative
2. …………………………………………………………………………………………………………………..
: It is important to find out how much of a product a business might expect
to sell in a market. This data will be quantitative

3.…………………………………………………………………………………………………………………………………..
* Businesses might be more successful if they can identify and understand
patterns of consumer behaviour
● Getting an insight into how people behave will help a business to meet
customer needs more effectively. This is qualitative data and might also
help them to identify new opportunities.

Primary Research
…………………………………………………………………………………………………………………………………………………
…………………………………………………………………………………………………………………………………………………
Most primary information is gathered by asking consumers questions or by
monitoring their behaviour..

Mrs. K.K.C.Sanjeewani BSc(Mgt) J’pura. PGDE, AMABE, MLRHRM

Methods of primary research

1. ……………………………………………………………………………..
A questionnaire is a list of written questions.
They are very common in market research and are used to record the
views and opinions of respondents.

Elements included in a good questionnaire

a) …………………………………………………………………………………………………………………………
…Closed questions allow respondents a limited range of responses
Open questions let people say whatever they want.

b) ……………………………………………………………………………………………………………………..

c) ………………………………………………………………………………………………………………………
Leading questions are those that 'suggest' a certain answer

d) ………………………………………………………………………………………

Questionnaires can be used in different situations

Postal surveys
Questionnaires are sent to people and they are asked to complete
them in their own time.
Online surveys
. These are likely to be cheap because they avoid printing and
postage cost

2. ……………………………………………………………………………………………..
A focus group is where a number of customers are invited to attend a
discussion organized by market researchers.
The group must be representative of the whole population and be
prepared to answer detailed questions.
This is a relatively cost-effective method of collecting information but
the group may be a little small.

3. …………………………………………………………………………………………………
Businesses may conduct face-to-face interviews in the street

Mrs. K.K.C.Sanjeewani BSc(Mgt) J’pura. PGDE, AMABE, MLRHRM

 The advantage is that questions can be explained if a respondent is
confused. It may be possible to collect more detailed information
However, many people do not like being approached in the street. This is
likely to be cheaper than questioning people in the street. Also, people from a wide
geographical area can be covered.

4. …………………………………………………………………………………………………………..
This is where consumers are encouraged to examine, use or test a product
before it is launched fully into the market. This enables businesses to make
late adjustments to the product, if necessary, based on the feedback they
gather
. A similar approach is called test marketing. This involves selling a new product
in a restricted geographical area to test it before a wider launch. After a period
of time feedback is gathered from customers. The feedback is used to make
modifications to the product before the final launch across the whole market. This
reduces the risk of failure.

The Advantages & Disadvantages of Primary Market Research

Advantages Disadvantages

● ●

● o

Mrs. K.K.C.Sanjeewani BSc(Mgt) J’pura. PGDE, AMABE, MLRHRM

 Secondary Research

● ……………………………………………………………………………………………………………………………………………
………………………………………………………………………………………………………………………………………….

Methods of secondary research

1………………………………………………………………

By analyzing the websites of competitors, a wide range of information can be

gathered very easily and cheaply

2………………………………………………………………

Social media can provide a cost-effective and indepth tool for gaining insights
into a firm's customers, market, brand appearance and other important market
research aspects.

Advantages of using social media

Broad
It can reach millions of people all around the world.
reach
Ability
Social media allows specific groups of people to be targeted.
to target
Free or The use of social media may be free for businesses and paid options
are usually cheap.
low cost
Personal It allows communication on a personal basis with individual customers and
groups.

Fast Information can be collected very quickly from large numbers of people.

Easy High-level IT skills and complex equipment are not needed.

Mrs. K.K.C.Sanjeewani BSc(Mgt) J’pura. PGDE, AMABE, MLRHRM

 3……………………………………………………………………

Some businesses may be able to use written information printed in newspapers

and magazines as a source of market research data

4…………………………………………………………………….
Programmes broadcast on television and radio may provide useful data for some
businesses.

5 ……………………………………………………………………
: The reports published by a wide range of organisations might be used to gather
secondary data

Database
……An organised collection of data stored electronically with instant access ,
searching and sorting files
…………………………………………………………………………………………………………………………………………………
…………………………………………………………………………………………………………………………………………………

Facilities that can be seen in a good database

1.be user definable (having a function or meaning that can be specified and varied by a
user)
2.file-searching facility for finding specified information from a file
3. file-sorting facility for rearranging data in another order
4. calculations on fields within records for inclusion in reports

Advantages and disadvantages of secondary data

Advantages Disadvantages
.quick and easy .may be out of date
cheap researchers have to be aware of bias
can be used before carrying out primary
research

Mrs. K.K.C.Sanjeewani BSc(Mgt) J’pura. PGDE, AMABE, MLRHRM

 .

Quantitative and qualitative Research

Qualitative research
market research collected relating to consumers attitudes , opinions and
belief………………………………………………………………………………………………………………………………………
…………………………………………………………………………………………………………………………………………………
………..Example of qualitative research could be face-to-face interviews with
100 purchasers (buyers) of new Land Rover Discoveries to find out why
they prefer this product

Quantitative research

the collection of data that can be measured (in numerical form )

…………………………………………………………………………………………………………………………………………………
…………………………………………………………………………………………………………………………………………………
Surveys and the use of government publications are common methods of
collecting quantitative research data

Sampling methods
A sample

Mrs. K.K.C.Sanjeewani BSc(Mgt) J’pura. PGDE, AMABE, MLRHRM

 A sample is a much smaller group. However, it is important that the behaviour
and views of the sample are representative of all those in the population.
The sample size will affect the accuracy of the information gathered. Large samples
will be more representative of the population and therefore more useful to a business.
However, using larger samples is more expensive

Different types of sample and sampling methods

1……RANDOM SAMPLING……………………………………………………………
Random sampling gives each member of a group an equal chance of being chosen.
In other words, the sample is selected at random
However, it assumes that all members of the group are exactly the same,
A small sample chosen this way may not have the characteristics of the
population. Therefore, a very large sample would have to be taken to ensure that it
was representative.
It would also be expensive for a business to draw up a list of the whole
population and then to contact and interview them.

2…………………………QUOTA SAMPLING ………………..

Here the target population being segmented into a number of groups that share
specific characteristics. These may be based on the age and gender of the
population
The main advantage of this sampling method is that it is more cost effective
than other methods. It is also useful where the proportions of the different
groups within the population are known.

3…………………………STRATIFIED SAMPLING
It is where the sample is divided into segments or strata based on previous
knowledge about how the population is divided

Mrs. K.K.C.Sanjeewani BSc(Mgt) J’pura. PGDE, AMABE, MLRHRM