Market 

Research                                                                 
--Market research It is about collecting information that provides an insight
into your customers thinking, buying patterns, and location. It is an effective
tool to assist your business planning.                                            -In
addition, market research can also assist you to monitor market trends and
keep an eye on what your competition is doing.

Market Research

Market research is the process of collecting, analyzing and interpreting information

about a product.

under market research we  have 2 different business categories

Product-oriented business: such firms produce the product first and then

tries to find a market for it. Their concentration is on the product – it’s
quality and price. The most common example are all basic necessities for
living- foods and agricultural tools.

Market-oriented businesses: such firms will conduct market research to

see what consumers want and 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. Example, mobile phone markets.

Why is market research important/needed?

Firms need to conduct market research in order to ensure that they are producing goods
and services that will sell successfully in the market and generate profits. If they don’t,
they could lose a lot of money and fail to survive. Market research will answer a lot of the
business’ questions prior to product development such as ‘will customers be willing to
buy this product?’, ‘what is the biggest factor that influences customers’ buying
preferences- price or quality?’, ‘what is the competition in the market like?’ and so on.

Market research data can be quantitative (numerical-what percentage of teenagers in the

city have internet access) or qualitative (opinion/judgement- why do more women buy
the company’s product than men?)
NB Market research methods can be categorized into two: primary and secondary
market research.

Primary Market Research (Field Research)

The collection of original data. 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). Examples include questionnaires, focus groups,
interviews, observation, online surveys and so on.

The process of primary research:

(Sample is a subset of a population that is used to represent the entire group as a

whole. 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. A random sampling occurs when people are selected
at random for research, while quota sampling is when people are selected on the
basis of certain characteristics (age, gender, location etc) for research.

Methods of primary research

 Questionnaires: Can be done face-to-face, through telephone, post or the

internet. Online surveys can also be conducted whereby researchers will
email the sample members to go onto a particular website and fill out a
questionnaire posted there. These questions need to be unbiased, clear and
easy to answer to ensure that reliable and accurate answers are logged in. 
(The first part of this wikiHow article will give you the basic idea of how a
questionnaire should be prepared.)
Advantages:
1. Detailed information can be collected
2. Customer’s opinions about the product can be obtained
3. Online surveys will be cheaper ans easier to collate and analyze
4. Can be linked to prize draws and prize draw websites to encourage
customers to fill out surveys.
Disadvantages:
 1. If questions are not clear or is misleading, then unreliable answers will be
given.
2. Time-consuming and expensive to carry out research, collate and analyze
them.

 Interviews: interviewer will have ready-made questions for the interviewee.

Advantages:
1. Interviewer is able to explain questions that the interviewee doesn’t
understand and can also ask follow-up questions
2. Can gather detailed responses, body-language also allowing interviewer
to come to accurate conclusions about the customer’s opinions.
Disadvantages:
1. The interviewer could lead and influence the interviewee to answer a
certain way. For example, by phrasing a question such as ‘Would you buy
this product’ to ‘But, you would definitely buy this product, right?’ to which
the customer in order to appear polite would say yes when in actuality they
wouldn’t buy the product.
2. Time-consuming ans expensive to interview everyone in the sample.

 Focus Groups: A group pf people representative of the target market (a

focus group) agree to provide information about a particular product or
general spending patterns over time. They can also test the company’s
products and give opinions on them.
Advantage:
1. They can provide detailed information about the consumer’s opinions
Disadvantages:
1. Time-consuming
2. Expensive
3. Opinions could be influenced by others in the group.

 Observation: This can take the form of recording (eg: meters fitted to TV
screens to see what channels are being watched), watching (eg: counting
how many people enter a shop), auditing (eg: counting of stock in shops to
see which products sold well).
Advantage:
1. Inexpensive
Disadvantage:
1. Only gives basic figures. Does not tell the firm why consumer buys them.