Market Research

M1
 The need for information
• Marketing opportunities can be identified and measured only if the
marketing environment is scanned or monitored on a continuous
basis.
• Marketing managers purposefully gather information on external
environmental variables and on internal resources in the form of
reports on, among others, current prices, sales figures, market trends,
technological changes, changes in market share, consumer preferences,
new legislation, production schedules and internal financial problems.
• This information is then systematised and classified in a way that is easily
accessible to marketing management.
• This means that marketing management must look for information
before decisions can be taken.
• This is done by means of marketing research.
 The need for information
cont…
• All marketing decisions are based on information about the
micro-environment, market environment and macro-
environment.
• If a problem occurs, existing information sources are
consulted.
• If there is no or little information available, research has to
conducted before a decision can be taken
• This is done by means of marketing research, which reveals
distinctive information that provides solutions for problems
regarding marketing decisions
 The need for information
cont…
• To ensure that managers make good decisions, the information
needs to:

o Increase understanding of the relevant market segment and its consumers

o Be pertinent to planning and controlling
o Help in decision-making one alternative sources of information have been considered.
 Marketing research methodology
• Marketing research is the systematic gathering, analysis and
interpretation of information on all types of marketing
problems by utilising acknowledged scientific methods for the
accumulation of information to facilitate marketing
management’s decision-making.
• The definition of marketing research refers to the use of
“recognised scientific methods” for obtaining market data.
• One of the most common methods is the survey method.
• In the survey method, a questionnaire is used and questions are
put to respondents either:
- personally by specially trained field workers
- telephonically
- through the mail

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 Figure 13.2 two broad types of
research in marketing research

Marketing Research

Problem identification
research: Problem solving
• Market potential research research:
• Market share research • Segmentation
• Image research research
• Market characteristics • Product research
research • Pricing research
• Sales analysis research • Promotion research
• Forecasting research • Distribution research
• Business trends research 6
 Market-research
methodology
1. Define the research problem
2. Identify the research objectives / hypothesis
3. Investigate secondary resources
4. Compilation of a questionnaire
5. Pre-testing of the questionnaire
6. Selecting a sample to distribute the questionnaire to
7. Training of the fieldworkers
8. Statistical analysis of data collected from questionnaires
9. Interpretation of the information
10. Research report and recommendations
Marketing research methodology
The steps in conducting a survey are:
• Step 1: Definition of the problem to be investigated.
• Step 2: Formulation of probable explanations and causes for the defined problem.
• Step 3: Investigation of all the hypotheses in order to eliminate the less likely ones
and find a solution to the problem.
• Step 4: Compilation of a questionnaire.
• Step 5: Testing the questionnaire.
• Step 6: Choosing the respondents to whom the questions are to be put.
• Step 7: The training of field workers.
• Step 8: The processing and analysis of the information contained in the
questionnaires.
• Step 9: The interpretation of results.
• Step 10: The compilation of a research report and the making of
recommendations based on the conclusions.
• Step 11: Marketing management (and perhaps top management) study the report
and make decisions.
• Step 12: Implementation of management’s decisions. This is the final step,
and hopefully, leads to finding a solution to the problem of declining sales.

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MARKET RESEARCH – Market
forecasting
1.Sales forecasting
• The following types of forecasting are often used:
- Estimates made by a panel of experts from within the
business and from outside.
- Estimates based on market research results.
- Estimates based on consumers’ reactions in test marketing
situations.
- Estimates based on historical figures.
- Estimates based on mathematical and statistical models.
- A combination of sales forecasting methods is often
employed in practice.

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MARKET RESEARCH – Market
forecasting cont..

2.Forecasting of the profit contribution

• Forecasts of the profit contribution are made for
much longer periods that the sales forecast, which
is made every year.
• Forecasts of the profit contribution are often made
for a full payback period.

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 FEEDBACK BY MEANS OF MARKETING RESEARCH
Takes a decision MARKETING MANAGEMENT
regarding the market offering, which
involves four variables:
• A product with need-satisfying properties
• Distribution which will deliver the products to the consumer at
the correct place and time
• Marketing communication messages, which inform the
consumer about the marketing offering and persuade him to
purchase
• A price which the consumer will be willing to pay