Market research is the process of finding information about your competitors, current market trends or your customers. Most companies invest in market research when they release a new product, improve on an existing product or if they plan on introducing a particular product in a new market.
Market research can also prove helpful if you want to explore business opportunities in new markets. Market research can be conducted by two methods, primary research or secondary research.
Primary Market Research
Primary research refers to information that is directly collected from the source. Another simple method of primary research would be to directly talk to your customers and get their feedback. Primary research can be both qualitative and quantitative
1.Qualitative Primary Research
Qualitative primary research involves gathering information from interviews or focus groups.
•Open-ended interviews include questions that cannot be answered with a yes or no. You can get a lot of information from such interviews and also find out about the dislikes, likes, requirements, trends and emotional motivators of your primary market
•A focus group should ideally be led by experienced professionals who can lead a group of 6 or more people and ask them both general and specific questions. Since trained professionals are required to handle focus groups, they are very expensive.
2.Quantitative Primary Research
Quantitative primary research involves the collection of numerical information from surveys. This information is then analyzed.
•Surveys can provide you with the information you require if the survey has meaningful questions. More people would be willing to take a survey as it takes less time. The cheapest and easiest way of conducting a survey is through the telephone and on the place where your product is being sold
CATI Surveys
The best way to out beat competition is to listen to your consumers. Although there are several methods of collecting reliable data from your customers, most data collection is conducted through CATI (Computer aided telephone interviews) which are cost-effective as well as reliable. CATI/Telephone surveys are the most effective method of collecting data from customers.
The process of the CATI survey is based on the objective brief, survey draft, call script and the lead list that is usually provided by the company who wants to conduct the survey. The right resources are identified and the technology /infrastructure needed to conduct the telephone surveys allocated. The CATI surveys are then conducted. The accuracy of the data can be measured and optimized through call center CRM technology.
CATI surveys can help you get an insight on why your customers are dissatisfied. You can also find out where your product/service stands in comparison to competitors. Based on the feedback that you get from your customers, you can customize your product to meet the requirements of your consumers.
Secondary Market Research
Secondary research is more economical and easier to do when compared to primary research. Here you will have to analyze the information that has been collected for some other reason. You can find the data that you require through a set of articles, demographic/ statistical data, studies etc.
By investing in secondary market research you can analyze your target markets, evaluate your competitors and assess political, social and economic factors. The internet has a large number of secondary data sources and most resources, magazines and press releases are now available online.
Secondary Market Research Resources
There are a large number of resources from which secondary research information can be obtained. Some of these sources are:
•Trade Associations
From the reports available with trade associations you can get information on the industries served, the standards that they observe and the leaders in their field. You can also get information on the latest trends, issues and competitors.
•The Marketing Departments of Local Colleges
The marketing department of any college can give you access to special research projects and reports prepared by students.
•Chamber of Commerce
The local chamber of commerce in your area can give you information on your local community and local businesses. You can also get access to the maps of the area.
•Insurance Companies, Banks and Real Estate Companies
You can information on the statistics of the communities to whom they provide services.
•Wholesalers and Manufacturers
From manufactures and wholesalers you can get information on customers, problems if any, costs, industry standards etc
•Libraries and other Public Information Centers
In the reference sections of libraries and information centers you can find a lot of resource materials and data.
•Books and Publications
There are several books that can give you information on a particular type of industry or market. Trade journals are another excellent source for information. You can also get information from government publications.
•Magazines and Newspapers
You can get a lot of information from news events and get the latest information on politics, economic indicators etc. The archives of leading newspapers and magazines can provide you with a wealth of information. Industry journals are another source of information.
•Media Representatives
Media representatives who work with print, audio or audio-visual media mostly collect information on the markets that their viewers, readers and listeners are interested in.
•Competitors
By researching on the price, products/services, brochures and reports of your competitors you can get a greater insight on how to move forward in your business.
•Business Information Centers
Such centers usually have a large collection of videos, books, CDs, publications and other information that are helpful for small businesses.
•Federal Government Resources
You can get in-depth demographic data related to the economy, market or population.
•Regional Planning Organizations
If you are looking for data on a community’s past or current growth trend, you can look up the resources of regional planning organizations.
•Discussion Groups
Discussion groups are commonly known as Newsgroups. You can get a lot of information on a variety of topics from such groups.
Wednesday, October 14, 2009
Marketing Research
What is Marketing Research?
Market research and marketing research are often confused. 'Market' research is simply research into a specific market. It is a very narrow concept. 'Marketing' research is much broader. It not only includes 'market' research, but also areas such as research into new products, or modes of distribution such as via the Internet. Here are a couple of definitions:
"Marketing research is the function that links the consumer, customer, and public to the marketer through information - information used to identify and define marketing opportunities and problems; generate, refine, and evaluate marketing actions; monitor marketing performance; and improve understanding of marketing as a process. Marketing research specifies the information required to address these issues, designs the methods for collecting information, manages and implements the data collection process, analyzes, and communicates the findings and their implications." As defined by American Marketing Association
Market research consists of testing the market to determine the acceptance of a particular product or service, especially amongst different demographics. It is used to establish which portion of the population will or does purchase a product, based on age, gender, location, income level and many other variables. Market research allows companies to learn more about past, current and potential customers, including their specific likes and dislikes.
Marketing Research Process
Marketing research is gathered using a systematic approach. An example of one follows:
1.Define the problem. Never conduct research for things that you would 'like' to know. Make sure that you really 'need' to know something. The problem then becomes the focus of the research. For example, why are sales falling in New Zealand?
2.How will you collect the data that you will analyze to solve your problem? Do we conduct a telephone survey, or do we arrange a focus group? The methods of data collection will be discussed in more detail later.
3.Select a sampling method. Do we us a random sample, stratified sample, or cluster sample?
4.How will we analyze any data collected? What software will we use? What degree of accuracy is required?
5.Decide upon a budget and a timeframe.
6.Go back and speak to the managers or clients requesting the research. Make sure that you agree on the problem! If you gain approval, then move on to step seven.
7.Go ahead and collect the data.
8.Conduct the analysis of the data.
9.Check for errors. It is not uncommon to find errors in sampling, data collection method, or analytic mistakes.
10.Write your final report. This will contain charts, tables, and diagrams that will communicate the results of the research, and hopefully lead to a solution to your problem. Watch out for errors in interpretation.
Sources of Data - Primary and Secondary
There are two main sources of data in Marketing Research namely:
•Primary
•Secondary
Primary research is conducted from scratch. It is original and collected to solve the problem in hand. Secondary research, also known as desk research, already exists since it has been collected for other purposes.
Classification of Marketing Research
Organizations engage in marketing research for two reasons: (1) to identify and (2) solve marketing problems. This distinction serves as a basis for classifying marketing research into problem identification research and problem solving research.
Problem identification research is undertaken to help identify problems which are, perhaps, not apparent on the surface and yet exist or are likely to arise in the future. Examples of problem identification research include market potential, market share, brand or company image, market characteristics, sales analysis, short-range forecasting, long range forecasting, and business trends research. A survey of companies conducting marketing research indicated that 97 percent of those who responded were conducting market potential, market share, and market characteristics research. About 90 percent also reported that they were using other types of problem identification research. Research of this type provides information about the marketing environment and helps diagnose a problem. For example, a declining market potential indicates that the firm is likely to have a problem achieving its growth targets. Similarly, a problem exists if the market potential is increasing but the firm is losing market share. The recognition of economic, social, or cultural trends, such as changes in consumer behavior, may point to underlying problems or opportunities. The importance of undertaking problem identification research for the survival and long term growth of a company is exemplified by the case of PIP printing company
Once a problem or opportunity has been identified, as in the case of PIP, problem solving research is undertaken to arrive at a solution. The findings of problem solving research are used in making decisions which will solve specific marketing problems. More than two-thirds of companies conduct problem solving research.
Standardized services are research studies conducted for different client firms but in a standard way. For example, procedures for measuring advertising effectiveness have been standardized so that the results can be compared across studies and evaluative norms can be established. The Starch Readership Survey is the most widely used service for evaluating print advertisements; another well-known service is the Gallup and Robinson Magazine Impact Studies. These services are also sold on a syndicated basis.
•Customized services offer a wide variety of marketing research services customized to suit a client's specific needs. Each marketing research project is treated uniquely.
•Limited-service suppliers specialize in one or a few phases of the marketing research project. Services offered by such suppliers are classified as field services, coding and data entry, data analysis, analytical services, and branded products. Field services collect data through mail, personal, or telephone interviewing, and firms that specialize in interviewing are called field service organizations. These organizations may range from small proprietary organizations which operate locally to large multinational organizations with WATS line interviewing facilities. Some organizations maintain extensive interviewing facilities across the country for interviewing shoppers in malls.
•Coding and data entry services include editing completed questionnaires, developing a coding scheme, and transcribing the data on to diskettes or magnetic tapes for input into the computer. NRC Data Systems provides such services.
•Analytical services include designing and pretesting questionnaires, determining the best means of collecting data, designing sampling plans, and other aspects of the research design. Some complex marketing research projects require knowledge of sophisticated procedures, including specialized experimental designs, and analytical techniques such as conjoint analysis and multidimensional scaling. This kind of expertise can be obtained from firms and consultants specializing in analytical services.
•Data analysis services are offered by firms, also known as tab houses, that specialize in computer analysis of quantitative data such as those obtained in large surveys. Initially most data analysis firms supplied only tabulations (frequency counts) and cross tabulations (frequency counts that describe two or more variables simultaneously). With the proliferation of software, many firms now have the capability to analyze their own data, but, data analysis firms are still in demand.
•Branded marketing research products and services are specialized data collection and analysis procedures developed to address specific types of marketing research problems. These procedures are patented, given brand names, and marketed like any other branded product.
Market research and marketing research are often confused. 'Market' research is simply research into a specific market. It is a very narrow concept. 'Marketing' research is much broader. It not only includes 'market' research, but also areas such as research into new products, or modes of distribution such as via the Internet. Here are a couple of definitions:
"Marketing research is the function that links the consumer, customer, and public to the marketer through information - information used to identify and define marketing opportunities and problems; generate, refine, and evaluate marketing actions; monitor marketing performance; and improve understanding of marketing as a process. Marketing research specifies the information required to address these issues, designs the methods for collecting information, manages and implements the data collection process, analyzes, and communicates the findings and their implications." As defined by American Marketing Association
Market research consists of testing the market to determine the acceptance of a particular product or service, especially amongst different demographics. It is used to establish which portion of the population will or does purchase a product, based on age, gender, location, income level and many other variables. Market research allows companies to learn more about past, current and potential customers, including their specific likes and dislikes.
Marketing Research Process
Marketing research is gathered using a systematic approach. An example of one follows:
1.Define the problem. Never conduct research for things that you would 'like' to know. Make sure that you really 'need' to know something. The problem then becomes the focus of the research. For example, why are sales falling in New Zealand?
2.How will you collect the data that you will analyze to solve your problem? Do we conduct a telephone survey, or do we arrange a focus group? The methods of data collection will be discussed in more detail later.
3.Select a sampling method. Do we us a random sample, stratified sample, or cluster sample?
4.How will we analyze any data collected? What software will we use? What degree of accuracy is required?
5.Decide upon a budget and a timeframe.
6.Go back and speak to the managers or clients requesting the research. Make sure that you agree on the problem! If you gain approval, then move on to step seven.
7.Go ahead and collect the data.
8.Conduct the analysis of the data.
9.Check for errors. It is not uncommon to find errors in sampling, data collection method, or analytic mistakes.
10.Write your final report. This will contain charts, tables, and diagrams that will communicate the results of the research, and hopefully lead to a solution to your problem. Watch out for errors in interpretation.
Sources of Data - Primary and Secondary
There are two main sources of data in Marketing Research namely:
•Primary
•Secondary
Primary research is conducted from scratch. It is original and collected to solve the problem in hand. Secondary research, also known as desk research, already exists since it has been collected for other purposes.
Classification of Marketing Research
Organizations engage in marketing research for two reasons: (1) to identify and (2) solve marketing problems. This distinction serves as a basis for classifying marketing research into problem identification research and problem solving research.
Problem identification research is undertaken to help identify problems which are, perhaps, not apparent on the surface and yet exist or are likely to arise in the future. Examples of problem identification research include market potential, market share, brand or company image, market characteristics, sales analysis, short-range forecasting, long range forecasting, and business trends research. A survey of companies conducting marketing research indicated that 97 percent of those who responded were conducting market potential, market share, and market characteristics research. About 90 percent also reported that they were using other types of problem identification research. Research of this type provides information about the marketing environment and helps diagnose a problem. For example, a declining market potential indicates that the firm is likely to have a problem achieving its growth targets. Similarly, a problem exists if the market potential is increasing but the firm is losing market share. The recognition of economic, social, or cultural trends, such as changes in consumer behavior, may point to underlying problems or opportunities. The importance of undertaking problem identification research for the survival and long term growth of a company is exemplified by the case of PIP printing company
Once a problem or opportunity has been identified, as in the case of PIP, problem solving research is undertaken to arrive at a solution. The findings of problem solving research are used in making decisions which will solve specific marketing problems. More than two-thirds of companies conduct problem solving research.
Standardized services are research studies conducted for different client firms but in a standard way. For example, procedures for measuring advertising effectiveness have been standardized so that the results can be compared across studies and evaluative norms can be established. The Starch Readership Survey is the most widely used service for evaluating print advertisements; another well-known service is the Gallup and Robinson Magazine Impact Studies. These services are also sold on a syndicated basis.
•Customized services offer a wide variety of marketing research services customized to suit a client's specific needs. Each marketing research project is treated uniquely.
•Limited-service suppliers specialize in one or a few phases of the marketing research project. Services offered by such suppliers are classified as field services, coding and data entry, data analysis, analytical services, and branded products. Field services collect data through mail, personal, or telephone interviewing, and firms that specialize in interviewing are called field service organizations. These organizations may range from small proprietary organizations which operate locally to large multinational organizations with WATS line interviewing facilities. Some organizations maintain extensive interviewing facilities across the country for interviewing shoppers in malls.
•Coding and data entry services include editing completed questionnaires, developing a coding scheme, and transcribing the data on to diskettes or magnetic tapes for input into the computer. NRC Data Systems provides such services.
•Analytical services include designing and pretesting questionnaires, determining the best means of collecting data, designing sampling plans, and other aspects of the research design. Some complex marketing research projects require knowledge of sophisticated procedures, including specialized experimental designs, and analytical techniques such as conjoint analysis and multidimensional scaling. This kind of expertise can be obtained from firms and consultants specializing in analytical services.
•Data analysis services are offered by firms, also known as tab houses, that specialize in computer analysis of quantitative data such as those obtained in large surveys. Initially most data analysis firms supplied only tabulations (frequency counts) and cross tabulations (frequency counts that describe two or more variables simultaneously). With the proliferation of software, many firms now have the capability to analyze their own data, but, data analysis firms are still in demand.
•Branded marketing research products and services are specialized data collection and analysis procedures developed to address specific types of marketing research problems. These procedures are patented, given brand names, and marketed like any other branded product.
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