The Purpose & Methods of Market Research Practice Questions

Item A: Rosebank Soaps Ltd

Rosebank Soaps Ltd makes handmade soaps. The business is owned by Callum Fraser and employs 12 people at a workshop in Carlisle. Rosebank sells through its own website and to 40 independent gift shops.

Callum wants to launch a solid shampoo bar. Before he decides, he has collected the following market research:

• an online survey emailed to Rosebank's 600 existing customers. Only 180 customers replied, and 68% of those said they would buy a shampoo bar priced at £7
• written comments from the same survey. Many customers said that Rosebank's packaging "looks old-fashioned" next to rival brands
• a market report bought from a research agency, which shows that the UK handmade soap market grew by 12% last year.

Table 1 Sales revenue in the UK handmade soap market, 2024

Business	Sales revenue (£000)
Rosebank Soaps Ltd	540
Hartley Bath Co	1 260
Sudsy Lane Ltd	900
All other businesses	2 700

Item A: Hale's Hot Sauce

Hale's Hot Sauce is a small business in Leicester owned by Marcus Hale, a sole trader. Marcus makes chilli sauces in a rented kitchen and sells them in 250 ml bottles for £5.50. He sells at two farmers' markets every weekend and through his own website. He employs two part-time workers.

Marcus has developed a new smoked garlic flavour. Before he spends £3 000 on bottles, labels and ingredients, he wants to find out whether customers will buy it. His social media page is followed by 3 000 people, many of whom post photographs of meals they have cooked using his sauces.

Marcus could give free samples of the new flavour at his two farmers' market stalls and ask customers to complete a short questionnaire. Alternatively, he could pay a market research agency £2 000 to run focus groups with shoppers in Leicester.

Item A: Menai Sea Tours

Menai Sea Tours is a small business on Anglesey in North Wales, owned by Aled Morgan, a sole trader. Aled runs guided sea-kayaking tours for beginners, charging £40 per person for a half-day tour. He owns 12 kayaks and employs two qualified guides during the summer. Most of his customers are tourists who book through his website after finding it on a search engine.

Menai Sea Tours is fully booked in July and August but takes very little money between October and March, when the guides are laid off and the kayaks are stored in a rented unit costing £180 a month.

Aled wants to earn money in the quieter months. He is thinking about buying six paddleboards, which would cost £3 600 in total, and offering a new 'sunrise paddleboard tour' priced at £30 per person. Before spending this money he wants to find out whether enough people would book it.

Aled could carry out his own survey of 300 visitors at the harbour and at nearby campsites. Alternatively, he could buy a published market report on UK outdoor activity tourism, costing £450.

Item A: Verde Boxes Ltd

Verde Boxes Ltd is a private limited company based in Bristol. It delivers vegetarian recipe boxes to homes across the South West. Each box contains pre-measured ingredients and recipe cards for three meals and costs £24. Customers choose from 12 recipes each week and select the evening on which their box is delivered. The company was started in 2020 by Anya Kowalczyk and Tom Berry and now employs six people.

Before they started, Anya and Tom read market reports on the UK food delivery market and held a focus group with 10 local families. Every year they now send an online questionnaire to all of their customers. Table 1 shows the main reason customers gave for choosing Verde Boxes in the most recent questionnaire, which 400 customers completed.

Two national recipe box companies have recently started delivering in the South West. Both are offering a lower introductory price. Anya and Tom are deciding whether to reduce the price of a Verde box from £24 to match them.

Table 1: main reason given for choosing Verde Boxes (400 customers)

Main reason given	Number of customers
Price	48
Quality of ingredients	132
Choice of recipes	160
Convenience of delivery	60