Market research


Market research will reduce the risk of launching a new product because:



Decisions are based on evidence (information collected by market research). Therefore, before launching a new product market research is carried out to find out if there is any demand. Therefore, it is more likely that there will be demand for the product and this means that the high costs of developing and launching the product can be recovered.



Primary market research

Information (or the collection of information), which does not already exist that has been collected for a firm’s specific purpose and is directly related to the firm’s needs.



Methods of primary market research

Questionnaires / surveys

Observation

Loyalty cards

The Dephi Technique



Secondary market research



Information (or the collection of information), which has already been collected for another purpose by someone else.



Sources of secondary data

The government

international organisations,

businesses that specialise in market research, e.g.: Keynotes, Mintel

trade associations,

the competition,

newspapers,

Business Link.



Types of secondary data that could be used by a small business person

www.yell.com /Yellow Pages. Thompson Local

Trade associations (organisations that represent specific businesses) – trade magazine

Business Link

Competition’s research

Government statistics

Information from companies that specialise in collecting market research, e.g. Keynotes.





Test marketing

Test marketing is when a business launches its product in a small part of the market before selling it in the whole market.

The point is to see whether there is any demand and to find and solve any problems with the product before selling it in the whole market. It is more expensive to sell the product in the whole market so test marketing solves any problems before the costs get high.



Sampling

A sample – a group of respondents, that are chosen to be representative of the views of the target market.

Target market – the precise profile of the customers a firm wishes to sell to, e.g: 18-25 year old men.



Types of sampling methods



1. Random sampling

Every member of the population has an equal chance of being interviewed.



2. Quota sampling

The sample of people interviewed reflect the characteristics of the market as a whole, i.e:

They are recruited in proportion to the demographic profile of the target market.

E.g.: The researcher might be given a target of interviewing 60 males between 20 and 29 years of age and 40 females of between 30 and 39 years of age.



3. Stratified sampling

A sampling method where a selection of people is randomly chosen from within a sub-group.

E.g: If a survey aims to find out the views of 18 to 25 year old females, they would randomly select people within that group to ask questions.



Factors that affect the choice of sampling method:



1. Available finance

2. The nature of the product

3. The level of risk

4. The target market   From Ashbourne Schools fab Blog

What is GDP?

http://news.bbc.co.uk/1/hi/business/10152610.stm


Declan Curry explains just what GDP stands for, and why we should care

Research Theme –
The Recent Recession in the UKIn your research on the recent recession in the UK you should consider:-

• how the recession can create opportunities and threats for businesses and industries-
• the long-term strategies and short-term plans adopted by businesses in the recession-
• factors influencing the strategies businesses adopt in the recession-
• strategies that businesses could have adopted to prepare for the recession-
• the possible impact of the recession on stakeholders and on relationships between businesses and their stakeholders-
• the case for and against different businesses and industries receiving government financial support during a recession.

Your research should consider the effects of and reaction to the recent recession in the UK in relation to different businesses and industries.You should make reference to your research in your responses to Section A in the examination.

Down-Sizing - in a bottle (1L to 850ml) Part 2

I asked Robinsons/Britvic about the downsizing and here is there response:

We have redesigned the Barley Water bottle in an attractive 'heritage' PET format in celebration of Robinsons 75th year at Wimbledon. We have not made any changes to the Barley Water product itself although we are always exploring ways of making our products taste even better than they do already.

As you are aware we have moved from 1L to 850 ml which provides 17 servings per bottle. We have made this change to deliver a uniform serve size across our 'added-value' squash range (which includes Robinsons be Natural & Robinsons Select a new product).

Per litre Robinsons Barley Water has increased in price. This is due to the ever increasing costs of ingredients and manufacturing. Despite these and other cost pressures, we have frozen our manufactures recommended selling price (MRSP) on Barley Water at £1.59. However Britvic is also significantly increasing the promotional investment in Barley Water. This means that the brand will be discounted more often in-store, with price reductions occurring later in the year depending on the retailer.

So they have shrunk the bottle size by 15% and frozen the MRSP, that's a 15% rise in price then! They promise the higher price will subsidise more special offers - no prizes for spotting that these will be later in the year, not near Wimbledon when the PR will be at a maximum.

Down-Sizing - in a bottle (1L to 850ml)

With Wimbledon five weeks away, drinks supplier has chosen an interesting time to shrink the size of their Orange and Lemon Barley Water lines. Quantities have slipped to 850ml. I don't know if the price shrank to 85%, what do you think?

This is not the only drinks supplier to engaging in this cost reducing strategy as Copella have done the same with their line of premium apple juice.

What links Robinson's Barley Water with Copella? The are both attached to PepsiCo, either owned in the case of Copella (via Tropicana) or as a distributing partnership.

What are the cost and environmental implications for smaller pack sizes?

Assessment Activity 2

With reference to the item on the car industry and your own research, to what extent do you believe the degree of competition in the market is the KEY FACTOR determining the startegy adodpted by firms in the recession?

This question is not asking what strategies firms should adopt but, instead what factors influence the strategies they adopt.

Essentially you have to contrast the level and nature of competition experienced, with other factors that are influencial.

What we have looked at so far: -

From paragraph 1
Who the competitors are, where they are, and how they become competive (lower costs with labour plus the competitiveness of their exchange rates).

From paragraph 2
We identified that Europe was a developed market where mostly all those who want cars, and can afford them have them (a saturated market), plants have closed, reference to GM, and its UK subsidiary, Vauxhall.

From Paragraph 4
We looked at disposable incomes in the developing economies of S.E. Asia, as a driver of demand in that area of cars, and how economies of scale could be used, specifically technical economies if plant.

We put each paragraph has been put together as an analytical paragraph with, application appropriate to the context of the material.

Now over to you.

Coffee shops remembered - thanks T2U!

http://news.bbc.co.uk/1/hi/business/8334993.stm