Richard Leach

Marketing Research

A market occurs when buyers and sellers come together to trade. Marketing is about meeting the needs and wants of customers. Marketing is a business wide function – it is not something that operates alone from other business activities. Marketing is about understanding customers and finding ways to provide products or services which customers demand. Marketing activities are numerous and varied because they basically include everything needed to get a product off the drawing board and into the hands of the customer. The broad field of marketing includes activities such as:

  • Designing the product so it will be desirable to customers by using tools such as marketing research and pricing.
  • Promoting the product so people will know about it by using tools such as public relations, advertising, and marketing communications.
  • Setting a price and letting potential customers know about your product and making it available to them.

Usually, before launching a new product, organisations have no real idea of how the features and benefits of that product will be perceived by others or whether they will be prepared to buy it. Others may not necessarily value the same things in the same way as desk top guesses may suggest. That is why it is crucial to conduct marketing research – to find out what customers want.         There are 3 good reasons why a business should conduct out a market research e.g. to improve business result, to reduce risks and to discover new opportunities.

Marketing research is critical before you spend time and money developing a new product or service.  It's also vital to analyse your market through marketing research to properly target your customers before you waste your money on advertising or other marketing efforts that won't get you the results you want for the product you’ve developed.  

Customer behaviour - Once an applicant has become a customer you want to maximise that relationship. The key to success is to understand the behaviour of each customer and then delivering consistent and relevant strategies that foster long-term relationships and profitability. Usage and attitudes often go together. This is often particularly important for advertising research. One effect of changing or improving communication is to affect attitudes and understanding (it is a moot point as to whether changes in behaviour leads to changes in attitudes or vice versa). Cultural factors have a significant impact on customer behaviour. Culture is the most basic cause of a person’s wants and behaviour. Growing up, children learn basic values, perception and wants from the family and other important groups.

Marketing are always trying to spot “cultural shifts” which might point to new products that might be wanted by customers or to increased demand. For example, the cultural shift towards greater concern about health and fitness has created opportunities (and now industries) servicing customers who wish to buy:

• Low calorie foods
• Health club memberships
• Exercise equipment
• Activity or health-related holidays etc.

Customer satisfaction – customer satisfaction is a difficult to define. However, the product or service must meet customer needs, wants and expectations for quality and functionality. Sales and promotional activities need to create a positive experience for the customer. After sales service should also be positive and appropriate (e.g. user training, help lines, servicing etc). Customer satisfaction measures well you are delivering the product/service that you provide. Not normally part of market metrics as it relates purely to your customers. Some companies do try and measure satisfaction of non-customers relying purely on brand image, but technically this is a different measure as it is perception rather than reality based. Nonetheless, customer satisfaction can be considered competitively, to see how your service and performance compares to that of your rivals. By comparing satisfaction to brand usage, you can start to investigate customer loyalty and retention.

Brand awareness – a brand represents more than just a business name or logo design, an effective brand tells the customer what you do and who you are. It is the customer’s perception of your company. The percentage of customers in a market able to name your brand may be spontaneous or prompted. Popular brands would only be measured spontaneously, lesser known brands would be measured prompted. Can be cross-analysed with market penetration to assess depth of brand coverage and brand reach - the potential for the brand to win new customers. Also used with Brand Equity to establish the value of the brand.

Advertising awareness – advertising is the means of providing the most persuasive possible selling message to the right prospects at the lowest possible cost. Advertising is any paid form of non-personal presentation and promotion of ideas, goods and services through mass media such as newspapers. The percentage of customers in a market who claim to have seen your advertising may be spontaneous or prompted awareness. There is often a halo effect from the brand for prompted awareness so it may be higher than reality. Sometimes check questions are included. The importance of measuring the advertising awareness, advertising may be designed to use test and control areas, one with advertising, one without in order that the research really measures changes caused by the advert. Combining advertising awareness with market sales data you can estimate the "sale uplift" caused by the advertising and consequently the advertising cost per additional sale.

New product opportunities - In a fiercely competitive industry the ability to carve out a new market can be the key to success. But launching into a new market requires an understanding of the opportunities, risks, competitors, potential customers and other key players.  

Research into the potential of new markets can enable you to:

  • Better understand your current product
  • Identify other niches within the market
  • Identify a new market altogether
  • Understand the characteristics/needs of prospects in the new market and plan a marketing strategy.

Market Research Process

There are 8 ways in order to successfully complete the process:

  1. Proposal brief
  2. defining objects
  3. planning
  4. collecting data
  5. analysis and evaluation of data
  6. presentation of findings
  7. making recommendation
  8. Re-evaluating marketing activates

P2

Key Objective

The main aim to carry out this market research for Walkers crisps is to find out what new flavours people want.

Population - the total number of consumers in a given group, known as the target population. The target population is the entire group a researcher is interested in; the group about which the researcher wishes to draw conclusions. E.g. suppose we take a group of men aged 35-40 who have suffered an initial heart attack. The purpose of this study could be to compare the effectiveness of two drug regimes for delaying or preventing further attacks. The target population here would be all men meeting the same general conditions as those actually included in the study.

Sample

Carrying out a survey of every single potential consumer (known as the population) of a firm’s product would be impractical, time-consuming and costly. Businesses still, however need to collect enough primary data to have a clear idea of the views of consumers that are representative of all potential buyers of the product. There are a number of ways in which a sample can be chosen.

Quota sampling – this method involves the population being segmented into a number of groups which share specific characteristics. These may be based on the age and gender of the population.

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Random sampling – this method gives every member of the population an equal chance of being chosen. In other words the sample is selected at random, rather like picking number out of a hat.

 

My sampling method for market research will be random because walkers crisp is something that of all ages eat. Walkers are the market leader they have a range of crisps out there which the majority of the people enjoy eating.

Qualitative data

Qualitative research is in-depth research into the motivations behind the attitudes and buying habits of consumers. It does not produce ...

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