MARKET RESEARCH

MARKET RESEARCH

• DEFINITION – MARKET RESEARCH IS THE PROCESS OF GATHERING, ANALYSING AND

INTERPRETING INFORMATION ABOUT A MARKET.
• A BUSINESS NEEDS TO FIND OUT HOW MANY PEOPLE WOULD WANT TO BUY THE
PRODUCT IT IS PLANNING TO OFFER FOR SALE.
• IF THERE IS NOT A VERY BIG MARKET FOR THE PRODUCT, A GREAT DEAL OF MONEY
COULD BE WASTED DEVELOPING A PRODUCT THAT NOT MANY PEOPLE WILL BUY.
• IT COULD EVEN CAUSE THE BUSINESS TO FAIL ALTOGETHER.
• IT IS VERY IMPORTANT THAT MARKET RESEARCH IS CARRIED OUT ACCURATELY.
 TRY TO FIND OUT THE ANSWERS

• THE ROLE OF MARKET RESEARCH IS TO TRY TO FIND OUT ANSWERS TO THESE

QUESTIONS
• WOULD CUSTOMERS BE WILLING TO BUY MY PRODUCT?
• WHAT PRICE WOULD THEY BE PREPARED TO PAY?
• WHERE WOULD THEY BE MOST LIKELY TO BUY MY PRODUCT?
• WHAT FEATURE OF MY PRODUCT DO CUSTOMERS MOST LIKE OR DISLIKE?
• WHAT TYPE OF CUSTOMER WOULD BUY MY PRODUCT?
• WHAT TYPE OF PROMOTION WOULD BE EFFECTIVE WITH THESE TYPES OF
CUSTOMERS?
• HOW STRONG IS THE COMPETITION AND WHO ARE THE MAIN COMPETING
BUSINESSES
 PRODUCT-ORIENTATED AND MARKET-
ORIENTATED
• DEFINITIONS
• A PRODUCT-ORIENTATED BUSINESS IS ONE WHOSE MAIN FOCUS OF ACTIVITY IS ON THE
PRODUCT ITSELF
• A MARKET-ORIENTATED BUSINESS IS ONE WHICH CARRIES OUT MARKET RESEARCH TO
FIND OUT CONSUMER WANTS BEFORE A PRODUCT IS DEVELOPED AND PRODUCED
• A MARKETING BUDGET IS A FINANCIAL PLAN FOR THE MARKETING OF A PRODUCT OR
PRODUCT RANGE FOR SOME SPECIFIED PERIOD OF TIME. IT SPECIFIES HOW MUCH MONEY
IS AVAILABLE TO MARKET THE PRODUCT OR RANGE, SO THAT THE MARKETING
DEPARTMENT KNOWS HOW MUCH IT MAY SPEND
 PRODUCT-ORIENTATED

• SOME BUSINESSES PRODUCE THE PRODUCT FIRST AND THEN TRY TO FIND A MARKET FOR IT.
• THIS IS KNOWN AS BEING PRODUCT-ORIENTATED. NOT COMMON TODAY.
• PRODUCT-ORIENTATED BUSINESSES OFTEN PRODUCE BASIC-NECESSITIES REQUIRED FOR
LIVING, SUCH AS AGRICULTURAL TOOLS OR FRESH FOODS.
• THESE PRODUCTS MAY NOT HAVE A BRAND NAME AND ARE GENERAL PRODUCTS THAT
CONSUMERS NEED TO BUY.
• THE PRODUCER AND RETAILER ARE MAINLY CONCERNED WITH THE PRICE AND QUALITY OF
THE PRODUCT.
 MARKET-ORIENTATED

• BUSINESSES WHOSE MARKETS ARE NATIONAL OR INTERNATIONAL CANNOT USUALLY AFFORD

TO BE PRODUCT-ORIENTATED.
• IT IS RISKY TO PRODUCE PRODUCTS AND HOPE THAT THEY WILL SELL, WITHOUT FIRST
CARRYING OUT MARKET RESEARCH TO FIND OUT IF CONSUMERS WILL WANT THE PRODUCT.
• THIS APPROACH OF USING MARKET RESEARCH IS CALLED BEING MARKET-ORIENTATED
• IT REQUIRES BUSINESSES TO HAVE A MARKETING BUDGET.
• EACH BUSINESS HAS TO IDENTIFY THE WANTS AND DESIRES OF CUSTOMERS, BOTH NOW AND
IN THE FUTURE, IN ORDER TO PRODUCE THE RIGHT GOODS WHICH WILL SELL WELL AND
MAKE A GOOD PROFIT FOR THE BUSINESS.
 MARKET-ORIENTATED BUSINESSES ARE
BETTER
• ADVANTAGES
• MARKET-ORIENTATED BUSINESSES ARE BETTER ABLE TO SURVIVE IN THE
MARKET AND BE SUCCESSFUL BECAUSE THEY ARE USUALLY MORE ADAPTABLE
TO CHANGES IN CUSTOMER TASTES.
• THEY ARE ABLE TO TAKE ADVANTAGE OF NEW MARKET OPPORTUNITIES WHICH
MAY ARISE
• NEW PRODUCTS ARE LAUNCHED WITH MORE CONFIDENCE WHEN CUSTOMER
NEEDS HAVE BEEN IDENTIFIED BEFORE THE PRODUCT IS INTRODUCED ON TO
THE MARKET.
 MARKET RESEARCH METHODS

• MARKET RESEARCH CAN FIND OUT:

• QUANTITATIVE INFORMATION , WHICH ANSWERS QUESTIONS ABOUT THE
QUANTITY OF SOMETHING, FOR EXAMPLE, ‘HOW MANY SPORTS SHOES WERE
SOLD IN THE MONTH OF DECEMBER?’ OR ‘WHAT PERCENTAGE OF CHILDREN
DRINK SUGAR-FREE COLA?’
• QUALITATIVE INFORMATION , WHICH ANSWERS QUESTIONS WHERE AN OPINION
OR JUDGEMENT IS NECESSARY, FOR EXAMPLE, ‘WHAT DO CUSTOMERS LIKE
ABOUT A PARTICULAR PRODUCT?’ OR ‘WHY DO MORE WOMEN THAN MEN BUY
THE COMPANY’S PRODUCTS?’
 MARKET RESEARCH METHODS

• BOTH TYPES OF INFORMATION CAN BE GATHERED AS A RESULT OF

• PRIMARY RESEARCH, OR FIELD RESEARCH
• SECONDARY RESEARCH, OR DESK RESEARCH.

• DEFINITION
• PRIMARY RESEARCH IS THE COLLECTION AND COLLATION OF ORIGINAL DATA VIA DIRECT
CONTACT WITH POTENTIAL OR EXISTING CUSTOMERS. (ALSO CALLED FIELD RESEARCH.)
• SECONDARY RESEARCH USES INFORMATION THAT HAS ALREADY BEEN COLLECTED AND
IS AVAILABLE FOR USE BY OTHERS. (ALSO CALLED DESK RESEARCH.)
 SUMMARY

• WHAT IS MARKET RESEARCH?

• MARKET RESEARCH TRYING TO FIND OUT THE ANSWERS FOR
• MARKET ORIENTATED AND PRODUCT ORIENTATED
• MARKET RESEARCH METHODS
• QUALITATIVE INFORMATION AND QUANTITATIVE INFORMATION
• PRIMARY RESEARCH AND SECONDARY RESEARCH