- Created by: pink_butterfly
- Created on: 25-03-21 19:07
Unit 3: Chapter 8: Understanding Markets & Customers
A business needs to understand its market to decide on objectives. This is achieved by getting info, through use of marketing research where you gather and analyse data.
Market research may be used for purposes such as analysing the current business position, deciding on objectives, deciding actions and assessing success of marketing decisions.
The process of market research goes as follows.
Define problem / objectives > develop research plan > implement plan: collect / analyse data > interpret data and report findings
Simply, you must identify what the business wants to research. You decide how to get the data for this purpose, then get it, analyse it and interpret it, and use it for your decision.
Often market research is used to understand the customers. There are 6 Ws - Who, What, What (influences), Why, When, Where.
Who - the buyer may not be the consumer.
What - there may be unexpected reasons for what you buy, like chewing gum bought for a nic addiction.
When - products may be seasonal, they will know when to target you in communication
Why - chocolate may be bought as a reward or after a break up
Don’t forget who they would ask for information before buying!
Where - some things aren’t really bought online, people may travel hours to buy something
What influences - you may consider economical, personal, social and technical influences
Doing this will help businesses to be more competitive, because they are understanding customers better than their rivals do.
Market research may be primary or secondary. Secondary research uses existing data, which is usually cheap and available however it may not be the right format, modern or ideal for what you need it for. Primary research is collected first hand, which is usually modern and the format you’ll like however it could take longer to gather and be expensive therefore.
A manager will choose people to interview, these will be the target population. It’s obviously likely to be impossible to interview all the people you hope to sell to. Therefore a sample will be chosen - a representative group will be selected from the target population. This is valuable because it provides an insight into the market, it’s quicker than trying to talk to everyone too.
However value of sampling will depend on how it’s conducted. You must consider how you select people (friends will be biased), how you conduct it (asking questions to encourage an answer that may be wrong), and the sample size (if it’s small, it’s less likely to be as reliable).
There are types of data too - quantitative and qualitative. Quantitative data is numerical - it shows market happenings in a measurable format, but it doesn’t tell you why changes have occurred. Qualitative data is descriptive - it will provide insight into people, and is often a great starting point which can be examined further with quantitative analysis.
Identifying how customers see a brand…