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Market
research is a method of collecting data which will make you (as a
business) more aware of how the people, you hope to sell to, will react to your products
or services. Market research will answer questions like:
- Whether your products or services
are needed
- Who might want to buy your
products - (you may have defined the wrong type of person)
- What age, sex, income occupation
etc are the people I want to sell to
- If there are changes taking place
and how this might affect what you sell - (there might
be an up an coming decline in the demand for what you are about
to sell)
- How well your products or
services might sell - (It could be better or worst than what
you predicted)
- How much demand there is for what
you hope to sell - (you may need to increase or decrease your
production depending on the results)
- Who wont buy what
you hope to sell - (this will help your promotional plan as
it enables you to target the right people)
- What price would people be
prepared to pay - (this will help when you set out your
pricing policy)
What will I ask and to whom?
Firstly
you need to identify what you are hoping to find out e.g. I want to
find out how much demand there will be for this product. Once
you have identified your market research aim, you now need to look
at:
- What questions need to be asked which would gather valid results?
- (questions which are ambiguous or misleading will give you
false results)
- How do I carry it out? - (conducting
your research in the wrong area or asking the wrong type of
people will give you false results)
The
above points need to be thought through very carefully to ensure you
are able to collect valuable data. If you ask questions which
mislead or are confusing you will be collecting or conduct your
research in the wrong area or ask the wrong type of people, your
data results will be useless. Consider the type of people you intend
to interview and then ask yourself the best method of interviewing
them, this will help you to identify how best to carry out your
research. All you have to do now is carefully consider the
questions you intend to ask.
Conducting market research
There are number of ways in
which you can carry out your research but you need to carefully consider
why you made this choice and what you hope the evidence will suggest
to you. Questionnaires
and personal interviews are one of the most common ways in which you
can conduct market research, and there are many methods of gathering
data this way: Direct Interview, Mail Survey and Telephone
interview. Depending on the type of data you hope to collect will
have a impact on what you choose to use.
Direct Interview
This method involves approaching people directly and working through
your questionnaire with them. This method is particularly
useful if you are looking to launch a new product or are in the
early stages of setting up in businesses as there is a low refusal
rate. You can also use samples to demonstrate you products or illustrate
you ideas. If you have a sales person working for you, you could use
them to conduct your research with your existing clients.
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However, for the one man band, this type of research can be tedious
and terribly time consuming, and as direct interviewing is a skilled
technique, it could reap incorrect, false or misleading results. You
could, of course, bring in an specialist company to conduct the research;
this would certainly help to achieve better results, but for a small
business this could prove quite expensive.
Mail Surveys
This methods allows you to reach a lot further than the direct
interview as you don't have to physically be there, and it is a relatively
low cost way of conducting your research. However, it has a low response
rate as most people are not motivated in any way to respond; they don't know
you, your company, and care little to its success or failure. In addition,
you will also need to have a mailing list which may take you quite some
time to compile unless you buy a ready made list from a bulk mail agency. The
key to increasing your chances of responses is to make your questionnaire
easy to complete and return to you. Allow them to fax it back; if
you are sending to a business, include a pre-paid envelope if asking the
home owner to respond. Try to
be inventive in order to motivate your target group by having an automatic
prize draw for all people who respond to your questionnaire. Telephone
Survey
Again, the telephone survey is an excellent method of surveying people
at vaster distances. However, you may find that your calls are
received negatively; you may even exercise the phone being slammed down on
you or worse! For those who are willing to be interviewed over the
telephone, you need to make your call as brief as possible and so your
questions need to be highly targeted to get the best results. What
ever method you choose to use, the fact is that market research cannot be
ignored no matter how small or large your business is. Also once you
have conducted your research you should begin to plan your next
onslaught. Market research should be a part of your marketing
strategy. However, Market research
is only a small part of the research you may consider conducting.
True marketing research also encompasses research such as:
- Product research
- Sales research
- Advertising research
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