Business Studies Marketing A2

Market Research

Market Research is the collection, collation and analysis of data.

It can be done for descriptive, predictive, explanatory or exploratory reasons

A business may research: the market, competitors, products, promotion or pricing

Internal secondary research: existing market research, sales figures, feedback from sales team, accounts, stock movements

External secondary research: Competitors information, government publications, EU data, trade, commerical and general (newspaper) publications

Primary research includes: questionnaires, interviews, surveys (postal or telephone), observation, focus groups, consumer panels and test marketing

Why do it?

• Minimise risk
• Find out more about customer or markets
• Find gaps in the market
• Gain customers opinions on a product

Problems

• Can be inaccurate / unreliable
• Information is only as good as the method used
• Cannot eliminate risk
• Can be expensive and time consuming

Markets

A market is anywhere buyers and sellers can meet to exchange goods and services.

Market Share: The proportion of the total market that an business has achieved

Market segmentation involves subdividing markets into groups of customers with different needs, so that they can deliver goods or services to meet their needs.

A market can be segmented by: geographic, demographic, psychographic, or behavioural factors 

Advantages: match customer needs, increase profits, target marketing, gain market share of segments

Legislation

Sales of Goods Act  - goods must be: of satisfactory quality, as described, fit for purpose

Businesses must provide a replacement or money back if these conditions are not met.

Trade Descriptions Act - 'Any description of a good or service must not be false or misleading' (verbal descriptions, advertisements)

Weights and Measures Act - It is an offense to incorrectly indicate the amount of a product that is for sale

Working Time Directive - Employees must not be forced to work more than 48 hours per week

Employment Tribunal - It determines disputes between employers and employees. It deals with unfair dismissal, deiscrimination etc.

Advertising Standards Authority - Adverts should be: legal, honest, decent, responsible. (They can refer businesses to the Office of Fair Trading)

Office of Fair Trading - It aims to make markets work well for consumers by enforcing consumer law and consumer protection (It can investigate, as well as impose fines and imprisonment)

Data Protection Act - It protects data held about employees. Must comply with 8 principles

Competition Commission - Conducts enquires into markets, mergers and regulates major industries

Trading Standards - Aims to eliminate rogue traders and unfair practices from markets

Sampling Methods

Random - indiscriminate, everyone has an equal chance of being selected

Systematic - Uses a mahtematic formulae to calculate who will be selected (e.g. every 1000th person)

Stratified - Divided into segments thought to be representative of population

Quota - Population segmented by characteritics (less expensive)

Cluster - Population split by geographical location (random sample taken from cluster, quick)

Multi-stage - taking a random sample from another sample (Bury St Edmunds, Suffolk)

Marketing

Guerrilla Marketing - Make a business or product known on a small budget using non-traditional methods

Advantages - Low cost, simple, targeted, can be changed easily

Methods include: Product giveaways, demonstrations, chalkings/ tree postings, stickers and the internet (pop-ups, banners, viral adverts)

Market Led Marketing - A business chooses to focus purely on the customers needs

The customer is priority, good customer service, good relationships, meets expectations

Asset Led Marketing - A business chooses to focus on its core competencies when developing a new product or service. These may be human, physical (distribution) or intangible (brand/reputation)