JAWAHARLAL NEHRU TECHNOLOGICAL

UNIVERSITY,ANANTAPUR,ANANTAPURAMU-515002

SCHOOL OF MANAGEMENT STUDIES

Market Survey
LEARNING OBJECTIVES
• After having studied the meaning of an entrepreneur, his functions and the gap between demand
and supply, in the identification of business opportunities, we need to understand, meaning of
market survey and why a market survey is to be conducted by an entrepreneur.

INTRODUCTION AND MEANING

• Although informal marketing research has been practiced ever since firms began to market their
products, formal marketing research has developed only during the past six or seven decades. The
key distinction is that the formal approach is systematic. It follows an orderly sequence in which
each step is subordinated to a larger systematic whole to provide reliable information for decision
making.

• Marketing research therefore refers to the systematic collection, recording and analysis of data
relevant to marketing problem of a business in order to develop an appropriate information base
for decision making in marketing area.
DEFINITION
• The American Marketing Association (AMA) defines marketing research as "the systematic
gathering, recording and analyzing of data about problems relating to the marketing of goods and
services".

• Richard D. Crisp defines Marketing Research as "the systematic objectives and exhaustible search
for the study of facts relevant to any problem in the field of marketing".

• Clark and Clark defines Marketing Research as "Marketing Research is the careful and objective
study of product design, markets and such transfer activities as physical distribution, warehousing,
advertising and sales management".

• Marketing Research is a continuous process of investigation, recommendation and follow-up of

marketing problems, which is conducted by the market- ing researcher. The Entrepreneur obtains
the information from the researcher and makes sound decisions...
PURPOSE OR OBJECTIVES:

The contributions of market research are considerable. It facilitates both the

decision-making and the operational tasks of an entrepreneur. It contributes towards
achieving both consumer satisfaction and sales profitability. The purpose of
conducting Marketing Research are to:

1. Help in the selection of a right course of action.

2. Identify various opportunities or problems.

3. Evaluate the need of the customers.

4. Analyze the probable market for the product

5. Briefly study the competitors and the substitute products.

6. Identify the best sources of distributing the products.

7. Estimate future sales and expected share of the market.

8. Study the acceptance of the product, package, price, colour, etc. by

the consumers

9. Analyse the effectiveness of advertisement.

10. Assess the sales representatives efficiency.

TECHNIQUES OF MARKET SURVEY
The following techniques can be adopted for conducting market research:

1. Desk Research

This research is done by marketing expert with the help of published and other
written sources of information. It is called "Desk Research" as it involves table
work. Here the analysis of data is done based on available sources like jour- nals,
magazines, directories and on the internal records of the firm such as financial
statements, sales reports, etc.
 
Advantages
The advantages of Desk Research are

• (a) The data is easily available

• (b) It is not biased on the respondent

• (c) The information is acquired from government, stock exchange,

chamber of commerce and industry and other organised bodies and
hence it is reliable to a great extent.

• (d) Field work is not required (e) This method is least expensive.
(b) This method of research is based on secondary data, which has its own
limitations

(c) Field investigation is more reliable as it is collected directly.

2. Observation Method
• This method involves gathering data by observing and recording. This research
can be conducted by trained observes. Here the observer does not ask any
question to the person, but observes the actions without letting the person know
that he is being observed. Generally observation is done at the point of purchase
to determine the brand preference, likes and dislikes of the person in the product
and also the quality of the salesmen in the store.
Advantages
The advantages of this method are:
(a) Information collected by observation are more objective and
accurate.
(b) The willingness and ability of respondent is of no importance.
(c) It is not biased, as the person doesn't know that he is being observed.
(d) It is more accurate as the behaviour is observed and not described.
Disadvantages
The disadvantages of this method are:
(a) The success of this method depends upon the observer and his level
of competence and bias.
(b) The behavior of the consumer is not easily predictable.
(c) The observer must be present when and where the behavior occurs
and this time of occurrence cannot be easily determined.
(d) Generally the respondent will become aware that he is being
observed and may act differently.
• Observation research can also be carried out with the help of many mechanical
and electronic devices, particularly for recording the psychological reactions.
Some of the devices are (i) Eye-Camera-This records the time and order spent by
an individual in
• looking at the various parts of an advertisement. (ii) Psycho-galvanometer-This is
used to measure the extent of the response of the person watching an
advertisement. The degree of stimulation generated by an advertisement can be
measured by recording the changes in the perspiration rate, if the perspiration rate
of the body is increased by excitement.
• (iii) Audio-meter-This is installed in the radio and television sets of a select panel
of families. It is used to determine the radio and television timings and stations
preferred by families.
• These devices are popular in European continent and in USA, but not in India as
it is very costly and not very effective in India.
• Thus a manufacturer of breakfast cereals who wants to study the attention
producing value of a new package might station observers with cameras and tape
recorders behind the supermarket aisles where the cereal is shelved
• For Eg. A.C. Nielson company uses an audiometer in developing rating

• points for TV shows. It records when the TV set is on, to which channel it is
tuned, and whether video games are being used. Also Nielson recently developed
a more sophisticated version of the audi- ometer which continuously monitors
individual viewer choices and stores the data, which can be retrieved by computer
via telephone lines. The top of the meter box has touch-sensitive panels that bear
the names of each family member as well as visitors to the TV viewing room.
Touch-sensitive panels are also included to record the sex and age of visitors.
• Examples of mechanical, especially electronic, include turnstile counters that
monitors visitor traffic flow at Walt Disney world, Juke box counters that keep
track of the number of times a record is played, and the mechanical device that
3. Experimentation
• Under this method the experimenter deliberately manipulates or changes one or
more variable in such a way that its effect upon one or more other variables can
be measured. The experimenter may change any one factor of the product to see
the change in sale. He may change the price, design, colour, advertisement, size
or the product itself. A market segment is selected and the product is introduced
with a change in any one component of the product like the change in price and
keep all other components constant. After recording the data, the experimenter
may check the current sales, when compared to the sale before making change.
This method is also called Controlled Test Market.
• For Eg. If an experimenter wants to test if the sale of a product would increase
only because of change in the colour of the product, then, the products colour
would be changed and introduced to one market segment, while in all other
market segments the product is sold without any change. The sale in the test
market is checked and recorded, and, à comparison is made. If sales in the test
market increases, then the product's colour is changed.
Advantages
The advantages of this method are:

(a) A controlled experiment can be used under many different conditions with
fruitful results.

(b) This method is more realistic and gives best results.

(c) It is possible to measure relative efficiency.

(d) As the results developed are from real life situations, marketing programmes
can be implemented with confidence and profitably.
Disadvantages
The disadvantages of this method are:
(a) It is expensive and takes a long time.
(b) It is difficult to select market with identical characteristics
(c) It is also possible for the competitors to copy the product easily and
introduce the product, before the company actually introduces the product.
(d) The external environmental factors like taxes or other restriction are
varied and these changes may effect the sale of this product.
4. Depth Interviewing
• In this method an individual or a group of people (not exceeding 25 people) are
called to some place. A relaxed environment is provided and general questions are
asked. Then the interviewer initiates the conversation with the respondents by
asking a question relevant to the research study, and then allows him to speak out
freely. The interviewer encourages him to speak what ever he wants and finally
arrives at the relevant topic. Here, an attempt is made to get below the surface
level of the respondents mind so that his basic predispositions like fears,
unconscious feelings, needs, conflicts, etc. are uncovered. The conversa- tions are
recorded and then analysis is made.
• Depth interviewing is defined as "the administration of questions to respon- dents
in a completely relaxed environment wherein they are free to express themselves
without any fear of disapproval, dispute or admonition."
Advantages
The advantage of this method are:

(a) It has the capacity to uncover basic predispositions of respondents which has a
bear on the research problem.

(b) The volume and variety of information acquired are considerably more

(c) The range of uncertainty is comparatively less.

(d) The decision making task of the entrepreneur is easier.

Disadvantages
The disadvantages of this method are
(a) The time taken is relatively more, which discourages respondents
from agreeing to participate in the interview.
(b) It largely depends upon the skill of the interviewer to ask questions,
encourage conversation and grasp the important points.
(c) The respondents may not reveal their inner self. (d) It an expensive
technique
5. Projective Techniques
• Here the respondents are asked questions and encouraged to speak or project their
feelings, attitudes or motives of a third person and not themselves. In the process,
they speak out their own opinion. Hence their inner self is revealed truly. Some of
the projective techniques are sentence completion test, story completion test or
Word Association Test, role playing, whereby the respon- dents association to
certain word or situation would be revealed.
Advantages
The advantages of this method are
• (a) Respondents inner self is know

• (b) They feel free to speak out

• (c) Information can be acquired in large quantity (d) Decision making is more
practical and easier

Disadvantages
The disadvantages of this method are
• (a) It requires a really skilled competent and sensitive researcher, which is

• very difficult
6. Survey Technique
• A survey consists of gathering data by interviewing a limited number of people (a
sample) selected from a larger group. The researcher obtains information from the
respondents by interviewing them. This is the most common method of getting
the data. As it is collected directly from the original source, it is primary data.
This method is more effective than the experimental or observa- tion technique.
In this method, after selecting the right kind of sample, an appropriate
questionnaire is prepared to ask questions, which is called an inter- view.
• Respondents can be interviewed

(i) in person

(ii) by telephone or

(iii) by mail.
(i) Personal interview-The interviewer contacts the respondent personally and asks
questions face-to-face and records it. It is first hand information and accurate as it is
a direct method of collecting data. This method avoids misinterpretation and cross-
checking can be made easily.

(ii) Telephonic interview-The interviewer does not meet the respondent directly,
but, communicates over telephone. Where the respondents are scattered in distant
areas and where limited information is sought, the researcher can communicate
over telephone. It has an advantage of less cost, easy, quick, accurate information
through simple method.

(iii) Mail interviewing-In this method, the questionnaires are mailed to respondents
at their mailing addresses with the request to fill them up and return back. This
method is most economical and widely used. It saves time, money and labor, and,
eliminates the danger of bias by the interviewer. But, this method is suitable only
for literates, who have the willingness to give written answers, apart from causing
delay. The questionnaire is inelastic, as, supplementary questions cannot be asked.
MARKET RESEARCH PROCEDURE
Market Research procedure or process may broadly be as follows:

1. Problem Formulation

• It involves developing and understanding of the problem which requires the

attention of researchers. It may be either to identify the marketing problem
area or to develop possible solutions or both.

• For Eg. The researchers have to identify whether they have to conduct
research on the consumers, product, price, sales representatives, distribution
channel members, etc.
Market Research Procedure:

• Problem Formulation

• Analyzing the Sources of Information

• Preparation of Data Collection Forms

• Sample Designing

• Collecting Data

• Processing Data

• Report Writing
2. Analyzing the Sources of Information
• The information may be collected in terms of primary data or secondary data.
Primary sources provide data which are collected for some specific purpose. They
are collected from consumers, salesmen or dealers through survey, observation,
experimentation, etc.
• The secondary source provide data which are collected not for specific research
objective of the company. These are readily available from other sources like
journals, government or private organizations, consumer com- plaints, company
records, etc.
• Therefore, depending on the need, cost, time and usefulness, the company decides
upon the source of information.
3. Preparation of Data-collection Forms
• A structured questionnaire has to be prepared which lists all relevant question in a serial
depending on the nature of information sought, the kind of respon- dents, data collection method
used by the company, etc. The questions should be framed in such a manner that it helps in cross-
checking and comparison.

• Questionnaires can be an open-ended or closed-ended questionnaire. Open- end questionnaire

allows the respondent to answer in their own words. It often reveals more answers because
respondents are not constrained in their answers. It is useful where explanations are required.

• A closed-end questionnaire gives options to the respondent, and, he can make choice among the
possible answers. Here, the respondent need not think much as choices/options are given. It is
easier for him to answer the questions. It gives answers that are easy to interpret and tabulate. It
show how many people think in a certain way.

• Mechanical Instruments like Eye-Camera Psycho-galvanometer, Audio-meter, etc can be used for
conducting research where questions are not asked, but the respondent is only observed.
4. Sample-Designing
• The researchers have to identify the respondents to be contacted & hence a
sample of respondents from the universe have to be selected, as it is not easy to
conduct an interview of the whole population. A sample is a small number of
items, parts or respondents chosen at random from a large number and tending to
have similar characteristics nearly in the same proportion as in the universe i.e.,
the sample should be representative and proportionate.
Some of the sampling techniques are:

(a) Random sample-If a sample is drawn in such a manner that each time an item is
selected, each item in the population or universe has an equal chance of being
drawn, then the sample is a random sample.

(b) Stratified sample-When a universe or population is known to be hetero-

generous and when that heterogeneity has a bearing on the characteristics being
studies, the population may be divided into strata and random samples of units
drawn from each stratum. But to divide into strata, some information regarding the
population and its strata studied should be available to the researcher.

(c) Systematic sample-When a sample is obtained by drawing every fifth item or

every even item on a list, then the sample is systematic sample. Here the first item
selected is at random. The list of samples may be from census, voters list, directory,
etc.
• (d) Cluster sample-It is a group or a block or an area of respondents picked at random. It may be
on the basis of area, age, income, colleges, standard of living, etc.

5. Collecting Data
• After the selection of sample, the researcher has to appoint people or investiga- tors to carry on
investigation. They contact the respondents and gather data according to the method suggested
and direction given.

6. Processing Data
• It involves tabulation, analysis and interpretation of data. In tabulation the data collected are
arranged in classes and are assigned weights or grades. In analysing, the tabulated data are
examined. The data of tables are com-

• pared and averages and percentages are computed by usage of statistical tech- niques. This helps
in understanding the data and in easy interpretation. In Interpretation, necessary conclusions are
drawn according to the problem formulated.
7. Report writing
• A report contains analysis and conclusions based on the research data. Depend- ing on the
quantity of report required, some reports may narrate the whole report procedure where as others
concentrate on the analysis and conclusions

• and gives recommendations relevant to the research objective. Constructing the Research Plan

• Data sources

• Secondary/Primary data

• Research Approach

• Survey, observation, experimentation,

Research Instruments:
• Sampling plan
• Contact Methods
• depth interview
• Questionnaire or Mechanical instruments
• Sampling unit, sample size and
• procedure Telephone, mail, personal
LIMITATIONS OF MARKETING RESEARCH
(1) In the fast changing Market environment the data collected becomes historic
and the research finding based on them becomes irrelevant i.e. there will be time
gap between collecting of information and actually putting it into practice.

(2) It only provides a base for predicting future events and does not guarantee any
certainty in the happening of the event.

(3) Some research conclusions may be of limitation as the tools and techniques may
not be suitable i.e., it is difficult to convert some answers given in sentences into
numerical terms.
(4) Its use and effectiveness depends largely on the ability of the executives to get
the most value out of it.

(5) It is merely a tool for decision making and is not a substitute for decisions.

(6) It does not provide complete answer to marketing problems as the answers may
be wague or irrelevant.
• LET US RECOLLECT
• A marketing research is the systematic gathering, recording and analyzing of data
about problems relating to the marketing of goods and services. A re- search helps
in finding out the need of the customers, selecting the right course of action,
identifying various opportunities or problems, studying the strategies of
competitors, estimating future and so on.
The techniques used for conducting a market research is
• (1) Desk research which is based on available sources like journals magazines,
directories, financial statements or reports
• (2) Observation research, which is observed through an eye camera, Psycho
galvanometer or audio meter
• (3) Experimentation, where one factor is changed to see the change in sale of
product
• (4) Depth Interviewing, where the questions are administered in a relaxed
environment and answers are sought.
• (5) Projective technique, where research is conducted through third person test,
sentence completion test, story completion test, word association or role playing,
and
• (6) survey technique, where research is done through personal interview,
telephonic interview or mail interview.
• The step by step procedure in conducting a market research is first to formu- late,
the problem. Then the sources through which the information to be sought is to be
analyzed. The data collection forms i.e. an Interview schedule or Questionnaire is
prepared and the data is collected. The collected data is then tabulated, analyzed
and interpretation drawn. Finally, a report is prepared in the lay man's language
for further reference.
Thank
You