Theme 1 - Understanding the consumer

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  • Created by: becky.65
  • Created on: 04-05-17 15:40
What is market research?
Any activity that gives a business information about its product or service, its customers, its competitors or the market it operates in
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Why do businesses need market research?
To identify what's happening in the market now, to predict what might happen in the market in the future and to explore new possibilities in the market
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What does market research do for businesses?
It gives information that can be used to make better informed decisions in the future, it allows businesses to understand consumer behaviour and makes them more repsonsive to customers' needs and it helps them gain a competitve advantage
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Why is market research so important for businesses?
It helps reduce risks for start-up businesses and to helps to keep up with market trends and remain competitive
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What is primary research?
Gathering information, first hand from an original source, that has not been collected before. Involves asking people for specific information through questionnaires or focus groups
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What is secondary research?
Finding and using information that has already been gathered by someone else; includes Google or Office of National Statistics
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How can market research work for business start-ups?
For close observation of local markets so they can establish a gap and find out market trends in the market for a successful start-up
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How can market research work for long-established businesses?
To research the market for a new products, to look for gaps in the wider market so they can find out customer preferences
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What are some advantages of primary research?
Can be designed specifically to suit the purpose of the business, it will be up to date and relevant and the information is not available to competitors
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What are some disadvantages of primary research?
It can be expensive, it can take a long time and may be misleading information if the questions are not worded correctly
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What are some advantages of secondary research?
It can be done quickly and cheaply
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What are some disadvantages of secondary research?
It may not be specific to the researcher's needs, it can be dated and may not always be accurate
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What is quantitative research?
It is based on numerical data, measures key details and produces statistical information
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What is qualitative research?
It is based on consumers' attitudes and opinions as it tries to identify why consumers behave as they do
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What is random sampling?
Picking random people on many different streets throughout the day
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What is quota sampling?
It involves selecting evenly from particular groups within the population
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What is stratified sampling?
It draws on specific groups of people that may be identified with particular market segments
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What is market segmentation?
It means dividing the market into groups of consumers with similar characteristics so products and services can be more effectively produced and targeted for a particular segment
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What are the advantages of segmentation?
If a segment can be identified then a sale is more likely to be made, it can reduce competition, a premium price can be charged if the market segment gets exactly what they want and it encourages brand loyalty
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What are the disadvantaged of segmentation?
It can be expensive to research, it can be more costly to produce specific products, it may ignore other segments and it may be difficult to produce for the segment
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Other cards in this set

Card 2

Front

Why do businesses need market research?

Back

To identify what's happening in the market now, to predict what might happen in the market in the future and to explore new possibilities in the market

Card 3

Front

What does market research do for businesses?

Back

Preview of the front of card 3

Card 4

Front

Why is market research so important for businesses?

Back

Preview of the front of card 4

Card 5

Front

What is primary research?

Back

Preview of the front of card 5
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