Market Research Benefits and Types
Explore the significance of market research in making informed business decisions by defining market research, outlining its benefits, and distinguishing between field and desk research. Discover how market research helps in reducing risks of failure, identifying consumer preferences, and predicting market trends. Learn the importance of conducting primary and secondary research to gather valuable insights for business growth.
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Presentation Transcript
Chapter 21 Learning intentions In this chapter you will learn to: Define the term market research Outline the benefits of carrying out market research Distinguish between field research and desk research Explore the advantages and disadvantages of field research and desk research Conduct market research and analyse the results of that research Interpret and communicate your research findings. Textbook page reference: 239
Chapter 21 What is market research? Market research is gathering, recording and analysing information about consumer preferences for a good or service in order to make informed decisions about a potential market. Textbook page reference: 240
Chapter 21 Benefits of carrying out market research Market research helps a business to reduce the risk of failure by finding out: Information about customers needs and wants Consumers reactions to changes to an existing product or service Information about their competition The best price to charge their customers Consumers reaction to how the product is promoted The likely level of demand/sales for a new product or service. Textbook page reference: 240
Chapter 21 Use of market research To identify what is happening in a market. To identify what is likely to happen in the future. To explain the causes of changes in the market. To investigate new market possibilities. To identify gaps in the market. Textbook page reference: 240
Chapter 21 Types of market research Field research involves gathering information directly from the marketplace. Desk research involves analysing information that has already been collected. Textbook page reference: 241
Chapter 21 Field research Field research involves going to the marketplace to gather information first-hand for a specific purpose. It is also known as primary research and is carried out by making direct contact with existing customers or potential customers. Textbook page reference: 241
Chapter 21 Field research Methods of field research include: 1. Surveys 2. Focus groups 3. Observation. Textbook page reference: 241
Chapter 21 Surveys A survey involves asking consumers questions about products and services. Textbook page reference: 241
Chapter 21 Surveys It would be impossible to survey all consumers, so market researchers usually select a small number of people to represent all consumers. This is called sampling. Textbook page reference: 242
Chapter 21 Survey methods Personal interview: Face-to-face interview between the market researcher and consumer using a questionnaire. Textbook page reference: 242
Chapter 21 Personal interview survey ? Advantages: Allows for detailed responses. The question or answer can be clarified. ? Disadvantages: Time-consuming and expensive. Consumers may feel uncomfortable answering some questions face to face and may be dishonest in their responses. Textbook page reference: 242
Chapter 21 Survey methods Postal survey: Questionnaires are sent and returned through the post. Textbook page reference: 242
Chapter 21 Postal survey ? Advantages: Cheaper than a personal interview, as there is no interviewer involved. People can answer in their own time. ? Disadvantages: Very low response rate. Responses may take a long time to be returned. Textbook page reference: 242
Chapter 21 Survey methods Telephone survey: A series of questions are asked over the telephone. Textbook page reference: 243
Chapter 21 Telephone survey ? Advantages: Cheaper than a personal interview. People can be chosen from a wide geographical area. The question or answer can be clarified. ? Disadvantages: Difficult to get people to respond, particularly if you contact them at busy times. People may provide quick responses to get the survey over quickly. Textbook page reference: 243
Chapter 21 Survey methods Online survey: Survey is published on a website or sent via email. Textbook page reference: 243
Chapter 21 Online survey ? Advantages: Cheapest method. People worldwide can take part. People can answer in their own time. Responses can be analysed automatically. ? Disadvantages: Many people ignore on-screen pop-ups or ignore the option to complete a survey. The opinions of consumers who are not online are ignored. Textbook page reference: 243
Chapter 21 Focus groups A focus group is a group of consumers brought together to discuss a particular product or service. Textbook page reference: 243
Chapter 21 Focus groups ? Advantage: It is an efficient way to gather reactions and opinions from a group of people at the same time. ? Disadvantage: Some members of the group may dominate the responses and influence the views of other group members. Textbook page reference: 243
Chapter 21 Observation Observation involves watching or viewing consumers in action. Textbook page reference: 244
Chapter 21 Observation Advantages: Large numbers of people can be observed in one location. It is a relatively cheap method of market research, as there is no need to employ staff to interview consumers. ? ? Disadvantages: It is time-consuming and provides only limited information. For example, it shows what products are purchased, but it might also be useful to know why those products were chosen. Textbook page reference: 244
Chapter 21 Analysing field research findings A Pie Chart Information can be shown in graph format as a bar chart or pie chart. Textbook page reference: 244
Chapter 21 Field research Advantages: Up to date information is gathered. Relevant information is gathered for the specific needs of the business. ? ? Disadvantages: It is time consuming. It can be expensive. Requires skill to conduct. Textbook page reference: 244
Chapter 21 Desk research Desk research involves looking at and analysing information that has already been gathered for another purpose or from another source. It is also known as secondary research. Textbook page reference: 247
Chapter 21 Desk research Methods of desk research include: 1. Business sales reports 2. Newspapers & magazines 3. Internet 4. Central Statistics Office (CSO). Textbook page reference: 241
Chapter 21 Desk research Advantages: It s quick and easy to collect, as it uses information already available. Cheaper than field research, as it does not require trained interviewers. ? Disadvantages: The information may not be as useful or relevant as primary research since it wasn t gathered for the specific needs of the business. Information may be outdated. ? Textbook page reference: 244
Chapter 21 Recap and review Can you: Define the term market research ? Outline the benefits of carrying out market research? Distinguish between field research and desk research? Explore the advantages and disadvantages of field research and desk research? Conduct market research and analyse the results of that research? Interpret and communicate your research findings?
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