Market Research Flashcards
All 17 cards in this deck
What are the four purposes of market research?
To identify and understand customer needs, to identify gaps in the market, to reduce risk and to inform business decisions.
How does market research reduce risk for a business or its investors?
It gives evidence of demand before money is invested, reducing the chance of the business failing and money invested being lost.
What is primary research?
e.g. a café asking its customers to fill in a questionnaireNew data collected first-hand by the business for its own purpose — the café's questionnaire answers are its own original data.
What is secondary research?
Data that already exists and was collected by someone else — e.g. the internet, market reports and government reports.
True or false? A focus group is a way of collecting secondary market research.
False. A focus group is a primary research method; the internet and market reports are secondary.
What is a focus group?
A small group of customers led in a discussion about a product or idea, giving detailed qualitative views.
What is observation as a primary research method?
Watching and recording how customers behave — e.g. counting footfall or seeing which products shoppers pick up.
What is the difference between a survey and a questionnaire?
A survey is the process of asking a sample of people for their views; a questionnaire is the written or online set of questions used to do it.
Give one advantage to a small business of using the internet for secondary research.
It is a fast and convenient way to discover data, e.g. population figures.
Give one drawback of using the internet for secondary research.
It gives general data, not focused information, so the owner cannot tell whether there is enough demand for their particular product or service.
What is a market report as a source of secondary research?
A published study of a market's size, trends and main competitors that a business can buy or access.
Give one advantage of using government reports as secondary research.
They are usually free and based on large official samples (e.g. census data), so the data is reliable.
What is the difference between quantitative and qualitative market research data?
Quantitative data is numerical (e.g. 70% of people buy weekly); qualitative data is customers' opinions and reasons, which are not numbers.
How can social media be used to collect market research data?
Customers' comments, likes, shares and replies to online polls reveal their opinions and preferences at very low cost.
Which three things affect the reliability of market research data?
Sample size, bias in the sample or questions, and how old the data is.
True or false? A survey of 10 people is as reliable as a survey of 1000 people.
False. A larger sample is more representative, so the results are more reliable.
What are the steps to calculate a percentage change in market research figures?
e.g. weekly sales rise from 200 to 250
- Find the change:
- Divide by the original figure:
- Multiply by 100: a 25% increase