MARKET Overview and
RESEARCH Importance
OBJECTIVES
- Define market research and understand its importance.
- Differentiate between product-oriented and market-oriented businesses.
- Identify the types of market research data.
- Define market research and understand its importance.
- Differentiate between product-oriented and market-oriented businesses.
- Identify the types of market research data.
LESSON RECAP:
MARKETING,
COMPETITION AND
CUSTOMERS
INTRODUCTION TO
MARKET RESEARCH
Market research is the process of collecting, analyzing, and
interpreting information about a product or market.
It is important for businesses because
Importance:
- Ensures production of goods/services that will sell successfully.
- Helps answer key questions about customer preferences and
competition.
- it helps the business understand customer needs
- Helps the business identify market trends
- Helps them make informed decisions
- Helps reduce risks
- Helps develop strategies to increase sales and profitability
TYPES OF MARKET
ORIENTATION
1. Product-Oriented Business:
- such firms produce the product first and then tries to find a market for it.
- Focuses on the product's quality and price.
- Example: Electrical goods (refrigerators, computers).
2. Market-Oriented Business:
- Focuses on consumer needs and market research.
- Such firms will conduct market research to see what consumers want
-They then produce goods and services to satisfy them.
- They will set a marketing budget and undertake the different methods of
researching consumer tastes and spending patterns, as well as market
conditions.
MARKET RESEARCH
TYPES
Quantitative Data: Numerical data (e.g., percentage
of teenagers with internet access).
Qualitative Data: Opinion-based data (e.g., reasons
why women prefer a product).
PRIMARY MARKET
RESEARCH
Definition: Collection of original, first-hand data. Also known as Field research
It involves directly collecting information from existing or potential customers.
First-hand data is collected by people who want to use the data (i.e. the firm).
Methods:
- Questionnaires: Direct responses from customers.
- Interviews: One-on-one discussions.
- Focus Groups: Group discussions for feedback.
- Observation: Monitoring customer behavior.
Advantages and Disadvantages vary by method.
PRIMARY MARKET
RESEARCH
The process of primary research:
1. Establish the purpose of the market research
2. Decide on the most suitable market research
method
3. Decide the size of the sample (customers to conduct
research on) and identify the sample
4. Carry out the research
5. Collate and analyse the data
6. Produce a report of the findings
SECONDARY MARKET
RESEARCH
Definition: Collection of existing, second-hand data. Also
known as Desk research.
The collection of information that has already been made
available by others
Sources:
1. Internal:
Sales records, finance department, Opinions of distributors
and public relations officers, Finance department ,
Customer Services department
- External:
Government statistics, trade reports, internet, newspapers,
market research agencies
SAMPLING IN MARKET
RESEARCH
Sample: A subset of a population used to represent the whole.
A group of people who are selected to respond to a market research
exercise e.g. questionnaires
When doing research, it is often impractical to survey every member of a
particular population because the number of people is simply too large
Selecting a sample is called sampling
Caution: Small samples lead to inaccurate information
Types:
- Random Sampling: Randomly selected individuals. (occurs when
people are selected at random for research)
- Quota Sampling: Selection based on characteristics (e.g., age,
gender).
ACCURACY OF MARKET
RESEARCH DATA
Factors Affecting Accuracy:
- Sample size and characteristics.
- Question design.
- Data source reliability.
- Age and relevance of information.
PRESENTING MARKET
RESEARCH DATA
Data Presentation Methods:
- Tally Tables:
Raw data in table form.
- Charts:
Visualize totals or proportions
(e.g., bar or pie charts).
- Graphs: Show relationships between data (e.g., trend
CONCLUSION
Market research is crucial for understanding consumer
needs and market trends.
Accurate, well-presented data supports informed
decision-making and business success.
STRUCTURED
ASSESSMENT QUIZ
QUESTIONS
1. Define market research and explain why it is important for businesses.
2. Differentiate between product-oriented and market-oriented businesses,
providing an example of each.
3. Explain the difference between quantitative and qualitative data in market
research, and give an example of each.
4. List and briefly describe two methods of primary market research.
5. Identify and explain one advantage and one disadvantage of using focus groups
in market research.
6. What is secondary market research? Provide two examples of sources used for
secondary research.
7. Why is the reliability of market research data crucial for businesses? Mention
two factors that affect the reliability of data.
8. What is meant by a 'sample' in market research, and why is sampling used
instead of surveying an entire population?
9. Describe one way in which market research data can be presented effectively.
Why is this important?
