As the Market is in a constant state of change, businesses rely on market research on a regular basis for a number of reasons. For Descriptive reasons is one of them where ‘a business may wish to identify what is happening in its market’ (Peter Boyle (2001 Marketing Management and Strategy, Prentice hall)
Another is for Predictive reasons where ‘a business may wish to predict what is going to happen in the future’ (Peter Boyle (2001 Marketing Management and Strategy, Prentice hall)
‘A business may want to explain a variety of matters related to its marketing’ (Peter Boyle (2001 Marketing Management and Strategy, Prentice hall). This is for Explanatory reasons which may include sales in a particular part of the country. This considers new possibilities in a market.
Some books refer to Market Research and others to Marketing Research. The distinction between the two is that
‘’Market Research concerns the demands for the product (or service) both in terms of its extent and its nature of the demand (i.e. what type of people buy the product). And that
Marketing Research is much broader since it also includes research into the effectiveness of the marketing strategy. Its more than an investigation of (how many and who) wish to purchase the product.’’
(M Evans & H Martinho (1999) Contemporary Issues in Marketing)
The Research Process!
First of all when conducting a marketing research it is important to ‘Define the problem’. This involves clarifying the type of information required, why it is required, and what questions it is designed to answer. ‘To a certain extent this will depend upon the objectives of the organisation’ (M Evans & H Martinho (1999) Contemporary Issues in Marketing, Prentice Hall)
There are three broad areas from which information may come. Most organisation will have internal information kept within their own record system. To be successful an organisation needs to know what you need, to discover where to find it, and then retrieve it.
‘Nowadays computers have revolutionised the way information is stored, analysed and retrieved, which has made the task of dealing with internal information a lot easier.' (Alan Wilson (2002) Marketing Research, Prentice Hall)
Internal information comes from sources such as:
- Customer sales records
- Client database
- Sales representatives reports
- Correspondence with customers
- Unsuccessful bids quotations
- Customer payment records
- Internal assessment of markets and technological change
- Analysis of competitors
Secondly, a lot of information will already be published and available as external or secondary information. It is also known as Desk research.
‘Secondary research refers to the use and further analysis of data collected for other purposes’ (Peter Boyle (2001 Marketing Management and Strategy, Prentice hall)
It is called secondary data as it is often in the form of published material, collected by somebody else. External information can enhance the company’s existing knowledge. For example,
‘Postcodes help the computer to group customers geographically. By identifying and labeling certain characteristics of its customers, a company can make assumptions about their needs.’ (Dibb et al, (2001) Marketing Concepts & Strategies, Houghton Mifflin Co)
With this there are external sources which are
- Domestic socio-economic data. This involves classification of customers by their house type. Assumption is then made of the lifestyle associated with that type of house.
- Industrial classification where organisational customers can be classified according to the nature of the activities. Predictable demands of service can be expected then by certain types of organisations.
‘External sources can complement an organisation’s own information by providing direct comparison with competitors, by putting performance within the context of the economy as a whole, and by identifying markets offering potential’ (Alan Wilson (2002) Marketing Research, Prentice Hall)
External information comes from sources such as :
- Trade information
- Company reports and accounts
- Government and international statistics
- Retail audit data
The third method of collecting data is collecting primary information, known as field research. As internal and external data may not answer an organisations questions, as they may be out-of-date or it may not cover exactly the right market sector. Primary research meets the organisations specific needs. Primary data is first-hand knowledge, ‘straight from the horse’s mouth’.
‘There are three basic techniques of field research to collect primary data: Surveys, observation and experiments.’
‘The researcher must choose the appropriate method, whilst giving consideration to the relative costs, time availability, type of information required, type of people to be investigated, and the degree of accuracy required’. (Peter Boyle (2001 Marketing Management and Strategy, Prentice hall)
After collecting the data it is necessary to draw conclusions from it which can be of value in designing marketing strategy.
‘The analysis, interpretation and evaluation of results require an understanding of statistical theory. Particular reference should be made to techniques which test the significance of the findings.’ (M Evans & H Martinho (1999) Contemporary Issues in Marketing, Prentice Hall)
The final stage of a marketing research process ‘consists of recommending the strategy to be pursued in relation to the product and the marketing effort’. (M Evans & H Martinho (1999) Contemporary Issues in Marketing, Prentice Hall)
Marketing research is not pure research undertaken for its own sake, it is designed to provide answers commercially important marketing questions.
