Unit 4: Market Need Analysis

Lesson 1: Market Research

Contents
Engage 1
Introduction 1
Objectives 1

Explore 2

Explain and Elaborate 3

Market Research 3
The Need for Market Research 3
Importance of Market Research 4
Market Research Basic Questions 4
Types of Market Research 7

Extend 9
Activity 9

Evaluate 10

Wrap Up 13

Bibliography 14
Unit 4.1: Market Research

Engage

Introduction

Fig. 1. Start up business documents

Have you ever wondered why some start-up businesses become very successful
immediately and some others fail suddenly? How can we prevent business failures
particularly when we are starting a new one? How can we be sure that our products or
services will be bought by our target customers? Think about these as you immerse yourself
in this lesson.

Objectives
In this lesson, you should be able to do the following:
● Analyze the market need.
● Determine the possible product or service that will meet the need.

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DepEd Competencies
● Analyze the market need. (CS_EP11/12ENTREP-0a-3)
● Determine the possible product/s or services that will meet the need.
(CS_EP11/12ENTREP-0a-4)

Explore

10 minutes
Guide Questions
From your business plan in Unit 2, assess your proposed product or service using the guide
questions below:

1. Is your product really needed by the people? What are your justifications?

2. Who do you think will be your potential customers?

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3. Is the number of people who will potentially buy your product enough to cover your
business expenses and be able to get a good profit from it? What are your
justifications?

Explain and Elaborate

Market Research
Market research refers to the design, collection, and analysis of relevant data, arranged in a
systematic way, aimed at providing a solution to a specific marketing problem. It is a vital
step in business planning. A well crafted market research will significantly help the
attainment of business success.

The Need for Market Research

Market research findings will give the entrepreneur a good perspective of the changes in
consumer tastes on products and services. These changes are brought about by either the
changes in technology, market demand, and competitor’s product.

Research findings and results also give an overview of the prevailing economic conditions in
the field. They serve as a basis for determining whether to push through with the
production or launch of the product or service. It can also give insight if there is a need for it
to be rescheduled at a later time when the demand for it arises. Moreso, it can suggest the
total change of the product and come up with a new one that fits the current conditions and
demand.

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How does market research help entrepreneurs in

initiating a business enterprise?

Importance of Market Research

1. Marketing research provides an understanding of consumers’ needs
Well-Crafted market research will give the entrepreneur an excellent overview of the
related products’ prevailing prices, most effective packaging, as well as advertising/
marketing campaigns/ materials that gained popularity and attention from potential
buyers or clients.

2. Marketing research minimizes the risk of business failure

Part of the market research is to dwell on the risk levels that the proposed product or
service may encounter once it becomes available in the market. It can never
guarantee a fail-safe forecast or a sure success, but the provision of possible risks on
the product or business failure will be enough to caution the entrepreneur on the
kind of business he wants to venture.

3. Marketing research gives a forecast of the trends

Market research findings were not only known as a reference for the current market
demands. It has also been widely used for acquiring information on future demands
or customer needs. This will help the entrepreneur plan for the development and
improvement of the product or service in meeting and maintaining customers’ needs
and continued interest.

Market Research Basic Questions

In preparation for drafting market research, the following basic questions will be helpful to
serve as researchers’ guide.

Why conduct market research?

This question clearly identifies the purpose and goals of conducting market research.

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Unit 4.1: Market Research

What will be the market research?

The coverage and limitation of the market research to be conducted should be identified.

Tip
The seven market research basic questions do not need to be
answered strictly in the order as presented here. But the first two
should always be answered first.

Which part of the market will be researched?

There is also a need for the identification of a particular segment or segments of the market
being eyed by the researcher wherein he will conduct the market research.

Who among the members of the identified market will be researched?

After the selection of a particular segment of the market being eyed by the researcher, the
next concern would be the identification of who among the members of the market
segment will be requested to partake in the research.

When will be the right time to conduct the planned market research?
The conduct of market research must have proper time and timing. For example, if the
target participants in the market research are students, the researcher must be able to
identify when their common free time is, what are the common times that they are not that
busy so that their participation will not be perceived as a burden or an inconvenience.

Where will the market research be conducted?

Identifying when the right time is, comes hand in hand with pinpointing the best location or
venue to conduct the market research. Having the same sample scenario in the previous
question, it is not advisable to conduct the interview in the school canteen because the
location is noisy or boisterous. Having it in the library would not be advisable too for the
interview can be a source of noise and distraction to the students concentrating on their

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Unit 4.1: Market Research

readings. Select a venue that is fitted with your plan, like utilization of a discussion room or
the like.

How will the market research be carried out?

This question directly answers the methodology that will be employed in the conduct of
market research like surveys, observation, focused group discussion and the like.

What other essential market questions can you

add to the 7 already presented above?

Example
Market Research 7 Basic Questions and Answers

Situationer:
A group of students is going to conduct market research on their proposed product which is
an organic juice. Their target clients are the school students inside their campus. They have
come up with the following answers to market research 7 basic questions:

Questions Answers

Why conduct market research? To explore what type of snacks can be best
sold to students in the school.

What will be the market research? The research will identify what type of foods
and drinks during recess will be most
profitable to sell to the students.

Which part of the market will be Senior High School students

researched?

Who among the members of the identified Senior High School students who go to the
market will be researched? school canteen during recess.

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Questions Answers

When will be the right time to conduct the During recess, after the students bought
planned market research? their snacks and foods.

Where will the market research be School hallways and near the entrance of
conducted? the canteen.

How will the market research be carried By observation technique

out?

Types of Market Research

Different techniques in conducting market research are available in a variety of forms. This
lesson will tackle some of the most utilized forms that could help future entrepreneurs
decide which is most fitted for the product they have chosen. Table 1 below shows the
different types of marketing research and its description.

Table 1: Types of marketing research

Types of Marketing Description

Research

Advertising Research This type of marketing research aims to predict or trace

the effectiveness of an existing or related product or
service advertisement. The related product is assessed in
terms of its ability to catch the attention of potential
buyers, maintain the brand image at excellent levels, and
push the potential buyers to make a purchase.

Commercial Eye-Tracking This type of marketing research focuses on the

examination and evaluation of an existing or related
product or service’s advertising or marketing collaterals,
package design, colors, and themes, as well as website
layout and scheme. These factors will be used for
analyzing visual behavior and trends among its target
consumers.

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Types of Marketing Description

Research

Customer Satisfaction This type of market research requires quantitative and

Research qualitative data or interview that came from the feedback
of customers who already purchased the product, or a
related one, to gauge his satisfaction. The satisfaction
feedback will give the entrepreneur valuable information
on what to improve or innovate further to meet the total
satisfaction of the buyers.

Distribution Channel Audit Auditing or assessing the distributor or retailers’ purchase

ordering pattern and levels of a product or a related one
can be used in gauging how the product is received by the
buying public or its target market.

Internet Strategic This emerging type of market research provides the

Intelligence entrepreneur a no holds bar type of feedback and
assessment of the product or service. Using the Internet
in the form of chats, forums, blogs, etc., the product
under review is given an honest experience review, for
these channels are usually considered venues wherein
someone can freely express himself and his feelings, thus
becoming strong opinion formers.

Test Marketing A lot of business enterprises are using the test marketing
type of market research wherein a small, controlled
quantity of the product is being released to gauge the
level of acceptance of the buying public or target market.
Only upon successful assessment will the business
enterprise launch it on a wider market.

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Extend

Activity
How will you answer the 7 basic questions of market research in relation to the proposed
product in your business plan?

Questions Answers

Why conduct market research?

What will be the market research?

Which part of the market will be researched?

Who among the members of the identified

market will be researched?

When will be the right time to conduct the

planned market research?

Where will the market research be conducted?

How will the market research be carried out?

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Guide
● In answering the basic questions of market research, it should be as specific as
possible.
● Avoid broad/ generalized terms so as not to create confusion and vagueness.
● Focus on answering what is just being asked in each item.
● Avoid overlapping answers to several questions/ items. (Example, your answer in the
‘Why’ item is also answering the ‘What’ item.

Evaluate

A. You will do this activity together with your research

group mates. Each group will discuss the answer to
each item below. A speaker for the group will be
selected by the group members who will share the
group’s answers in front of the class.

What you will do in the following scenarios?

1. Your target participants in your market research are students. While inviting and
explaining to them your intention to include them in your research, some expressed
that they refuse to join.

2. You intend to conduct a group session/ interview with a number of teachers in your
school for your market research, but there is no common free/vacant time in the
schedule of the teacher-participants.

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3. You are having a difficult time identifying the ideal market segment as participants in
your market research.

4. The location where you plan to conduct your market research is quite far from your
locality. Many of the group members weren’t given permission by their parents to
join the market research activity of your group.

5. Your target participants in your market research are adult professionals. They
signified that they are not interested in participating in your market research
because your team is just wasting their time.

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B. Discuss among your research group mates what data/

information you can extract from the following types of
market research if your group decides to employ such, which
can be helpful for planning/improving your proposed
product or service.

Types of Marketing Research Data/ Information that can be extracted

Advertising Research

Commercial Eye Tracking

Customer Satisfaction Research

Distribution Channel Audit

Internet Strategic Intelligence

Test Marketing

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Wrap Up
___________________________________________________________________________________________

● Market research refers to the design, collection, and analysis of relevant data,
arranged in a systematic way, aimed at providing a solution to a specific marketing
problem.
● Market research is one of the most effective tools to utilize if the entrepreneur
wants to undertake the marketing aspect of the business effectively.
● Market research provides an understanding of consumers’ needs, minimizes
business risk and failure, and forecast of emerging market trends.

___________________________________________________________________________________________

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Bibliography
D’ Andrea, Aude and Ines Gabarret. Building 21st Century Entrepreneurship Volume 1. John
Wiley and Sons Publishing, 2017.

Dollingner, Marc. Entrepreneurship: Strategies and Resources 3rd Edition. New Jersey: Prentice
Hall, 2003.

Kotler, Philip & Gordon McDougall. Marketing Essentials. Prentice-Hall Canada Inc, 1985.

Miranda, Gregorio. Basic Marketing Revised Edition. L & G Business House, 1997.

Peters, Michael & Robert Hisrich. Entrepreneurship 4th Edition. McGraw-Hill Book Co, 1999.

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