|
After
choosing a business idea,
the next step is to know
your market to find out such questions as: 'Why would
people buy my product or service rather than those which
already exist?' 'How many are they likely to buy?'
To
answer these and other related questions requires market
research. Market research is the collection and analysis
of information with a view of improving the business marketing
activities. It is an essential part of all businesses
not only to assess the business idea, but also for continued
development.
Qualitative
& Quantitative Research
Research is often categorised as either being 'qualitative'
(how many do?....) and 'quantitative' (Why do they do?...).
Qualitative
Research
This involves the collection of data that is open to interpretation,
for example people's opinions. It is useful for investigating
people's motives, attitudes, beliefs and intentions.
Quantitative
Research
This involves the collection of information that is quantifiable
and is therefore not open to interpretation as with qualitative
research. It includes data such as sales figures, market
share and market size.
Quantitative
research is the most likely research to be undertaken
by small businesses. It can be split into two broad areas:
i
Primary research - This is also known as 'field' research
and is commissioned by an organisation for a specific
purpose. This is usually undertaken because the required
information does not already exist in any available format,
so the research has to be done from scratch.
ii
Secondary research - This is also known as 'desk'
research. It consists of data and information that already
exists that can be accessed.
Market
Research Methods
The most commonly used methods for collecting primary
and secondary data are:
1
Interviews and surveys
This
involves the collection of primary data directly from
individuals. Techniques include:
Personal
interviews - These are face-to-face meetings with
an interviewer and respondent. It can be used to obtain
information about the type of people, how they behave
(purchase behaviour), likes, and dislikes, attitudes and
opinions about the subject matter.
Group
interviews and focus groups - These are used to produce
qualitative data that provide useful insights into underlying
attitudes and behaviour. Usually involve six to eight
people representative of the target group. Useful where
budgets are limited or is the research topic is not yet
fully understood.
Telephone
interviews/research - They are primarily used in industrial
markets as a means of reaching a large number of respondents
relatively quickly and directly. Telephone
interviews are useful for usage and purchase surveys where
market size, trends, competitive share, assessing advertising
and promotional impact and customer satisfaction.
Postal
or self-completion - This is a popular form of research.
It involves sending a questionnaire through the post to
the respondent for self-completion and either return by
post of leave at an indicated place. The advantages are:
wide coverage, useful where target respondents can be
easily identified from contacts or mailing lists, less
expensive than telephone and face-to-face interviewing,
it can achieve a higher response by sending a user-friendly
covering letter and questionnaire and by offering a special
incentive (refer to: How
to design a questionnaire).
2.
Desk Research
This consists of data and information that already exists
that can be accessed. The most commonly used sources are:
government published data, trade published data, Chambers
of commerce, directories and publications such as 'Yellow
pages, 'Kompass', market research agencies and press published
data.
3.
Test Trial
You can test your product before any major investment
is made. Any refinements required can be made during this
phase.
4.
Search Engines
Search engines such as www.altavista.co.uk, www.lycos.co.uk
are useful tools to finding information. By typing in
the keyword or phrase, a search can be made on the Web.
If
carried out correctly, market research will enable you
to eliminate the guesswork, myth and intuition about your
market, thereby taking some of the risk out of start-up.
Useful
web sites
www.mori.co.uk
www.forrester.co.uk
www.cmr.com
Suggested
next stage: How to design
a questionnaire.
|
