There are two main types of Market Research. These are:
- Secondary Research
- Primary research
This is research that has been carried out by someone else. There are two types, internal and external.
Internal: Things such as company accounts, internal reports and analysis, stock analysis, and retail data.
External: Things such as trade publications, magazine surveys, government statistics etc.
First hand information which is collected by the individual who is doing the research.
Could be collected in forms of questionnares, focus groups, quantitative research, qualitative research, telephone surveys, customer interviews etc.
- Expensive to collect
- Care needs to be taken to ensure that results are valid and accurate
- The type of question asked may provide different results. E.g. open/closed
Sampling methods: part of Primary research
- Random Sampling: with random sampling, there is an equal chance of anyone being picked for research. Random sampling can prove to be expensive, and sample sizes usually need to be large.
- Stratified or Segment random sampling: this is based on sampling a certian group, but still choosing randomly. E.g. a researcher can choose to sample only males, but will choose randomly within that group. By doing this, the researcher may find more relevant information than just choosing to use random sampling.
- Quota Sampling: This is again carried out in a specific segment, however individuals aren't selected randomly. Limitations of Quota sampling could be that the results may not be fully representative of the whole public. However, the researcher may find what thet particular segment are specifically interested in.
- Cluster sampling: This is the sampling of a group of people in a particular area. Use of this however, can be used as being representative of the whole population (generalisation).
- Multi-stage Sampling: This is research which is carried out over a certain period of time (e.g. weekly, monthly...), on different groups/segments.
- Snowball Sampling: This is some type of research such as a survey which is passed onto other people like a 'word of mouth' approach.
The Purpose of Market Research
- To find out the size of the market (how many people want the product)
- Market trends (what people are into)
- Forecasting (predicting whats going to happen in the future)
- Planning (what the business plans to do depending on the forecast)
- Evaluation of strategies/Promotion (going over what was found)
- Assessing marketing mix- (analysing whether the 7 P's are working)
- Identifying market segments (the target groups)
- Identifying Consumer needs (the needs of customers)
- Identifying competition (from rival companies)
- Identifying opportunities/gaps in the market (is there a need for any certain product or service?)