Marketing Research - The Basics
Understanding markets and customers is the
foundation on which successful business planning and strategy is built.
Without understanding customer needs and wants and how these translate into
consumer demand, a business is under constant threat from competitors and may
be failing to extract the maximum value from its market.
Objectives of Market Research
The aim of market research should not just be about
identifying areas of customer demand, it also has to identify areas that can
be profitably exploited by a business.
This means understanding where a business's strengths
and weaknesses lie and what the implications might be of pursuing a
particular marketing strategy. Market research therefore involves
communication and sharing of results, understanding production and supply
implications and identifying stakeholder issues.
In terms of data capture and analysis there are two main
types of market research project :
(1) Qualitative Research;
(2) Quantitative Research
Qualitative Research
Qualitative Research is about investigating whys and hows of a market through
in-depth research that explores the background and context for decision
making.
There are two main qualitative methods - depth
interviews and focus groups. However qualitative research can also
include techniques such as usability testing, brainstorming sessions and
"vox pop" surveys.
Depth Interviewing
Depth interviews are the main form of qualitative research in most business
markets. Here an interviewer spends time in a one-on-one interview finding
out about the customer's particular circumstances and their individual
opinions.
The majority of business depth interviews take place in
person, which has the added benefit that the researcher visits the
respondent's place of work and gains a sense of the culture of the business.
However, for multi-national studies, telephone depth interviews, or even
on-line depth interviews may be more appropriate.
Feedback is through a presentation that draws together
findings across a number of depth interviews. In some circumstances, such as
segmentation studies, identifying differences between respondents may be as
important as the views that customers share.
The main alternative to depth interviews, focus group
discussions, are typically too difficult or expensive to arrange with busy
executives. However, on-line techniques increasing get over this problem.
Group Discussions
Focus groups, or group discussions are the mainstay of consumer research.
Here several customers are brought together to take part in a discussion led
by a researcher (or "moderator"). These groups are a good way of
exploring a topic in some depth or to encourage creative ideas from
participants.
Group discussions are rare in business markets, unless
the customers are small businesses. In technology markets where the end user
may be a consumer, or part of a team evaluating technology, group discussions
can be an effective way of understanding what customers are looking for,
particularly at more creative stages of research.
Quantitative Research
Quantitative research is about measuring a market and
quantifying that measurement with data. Most often the data required relates
to market size, market share, penetration, installed base and market growth
rates.
However, quantitative research can also be used to
measure customer's attitudes, satisfaction, commitment and a range of other
useful market data that can tracked over time.
Quantitative research can also be used to measure
customer awareness and attitudes to different manufacturers and to understand
overall customer behaviour in a market by taking a statistical sample
of customers to understand the market as a whole. Such techniques are
extremely powerful when combined with techniques such segmentation
analysis and mean that key audiences can be targeted and monitored over
time to ensure the optimal use of the marketing budget.
At the heart of all quantitative research is the
statistical sample. Great care has to be taken in selecting the sample and
also in the design of the sample questionnaire and the quality of the
analysis of data collected.
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