Notesale: Turn your study into money

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Market Research Definition:
The collection and analysis of market information where it
can include looking at the market as a whole, the
competitors, products, and the consumers in the market
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MARKET SHARE = (SALES OF A PRODUCT OR
BUSINESS/ TOTAL MARKET SALES) X 100
Added Value
 Increasing the difference between the cost of making the
product and the price that the customer pays
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ADDED VALUE = PRICE PRODUT IS SOLD FOR –
COST OF MAKING PRODUCT
 It can be achieved by either increasing the selling price of
the product or by reducing the costs of making the product
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Market Positioning and Market Mapping





A market map is laid out as a matrix where the products or brands are
positioned on it according to where they are judged to lie
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 Market maps can show a business who its closest competitors are
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 Market maps can show how much customers expect to pay
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Key Words:

Topic 1
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NICHE MARKET: a small market that has customers with specific needs or
requirements
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 Businesses in niche markets can be riskier as they sell to a smaller number and
narrower range of customers
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 In mass markets, there are businesses selling similar products, so there is more
competition which means businesses in mass markets might focus more heavily
on strong branding
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g
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g
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Businesses need to adapt to changes in the market in order to be successful
and maintain their market share and demand
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To achieve it, a firm needs to be doing something different to its rivals:
 Lower costs – producing a product but at a lower cost means a firm can charge a
lower price for its product, which should generate more sales
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 Advertising and marketing – the more a firm advertises its products and markets
it to make it attractive to buyers, the more likely it is to generate sales
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 Reliability and quality - businesses can maintain a good reputation if it sells products
that is reliable and better quality where it would enable them to charge higher prices
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 Convenience - anything a firm can do to make the buying experience quicker and
easier will attract customer
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There are different ways in which a market can be segmented:
 Demographic - e
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age, gender, socio-economic class
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g
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 Income - e
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luxury products are usually aimed at high income groups
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g
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Market Research
PRIMARY MARKET RESEARCH: when a business does market
research by gathering new information that does not exists
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 Primary data is needed to find out what consumers think of a
new product or advert
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 Primary data is exclusive to the firm who researched it, so
competitors cannot benefit from it
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SECONDARY MARKET RESEARCH: when a business does market
research using data that is already available and exists
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 Secondary data is much easier, faster, and cheaper to get hold
of than primary data
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It may have errors or be out of date
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A firm may then do more specific primary research to
investigate any issues or problems that are shown by the
secondary data
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It often uses multiple-choice questionnaires with closed
questions because they have fixed, predetermined answers
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 Less detail
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 Artificiality
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 Limiting
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It often involves open questions where the
answer is not restricted to multiple-choice questions
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 Time consuming
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 More difficult to generalise
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 Relies of skilled researchers
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But qualitative research may be more informative as the
responses can be more flexible
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 Generating hypotheses from qualitative research that can be
tested by taking a quantitative approach
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