Market Research

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					Market Research
This chapter will enable you to:
1. Describe the different types of market
   research
2. Develop an effective market survey for
   your company.
3. Use market research to understand your
   customers’ needs.
4. Analyze your industry
    What is market research?
• Your market consists of the potential
  customers for your product or service.

  – Market Research is how you find out who
    these customers are and what they need.

  – Market Research helps entrepreneurs figure
    out how to market their product or
    services…or to improve existing products or
    services
            Target Markets
• Find out everything about your target
  market:
  – What they eat, drink, listen to, watch on TV,
    how much do they sleep, where do they shop,
    movies they like, how much they make, how
    much they spend, etc…

  – Remember just don’t get too creepy 
• Facts about groups of people are called
  demographics. Where can you find such
  information?

  – Internet research
  – Magazine articles – statistics on the size of
    the target market
  – Business Library- Business section
    sometimes has info
 Types of Market Research (4)
1. Surveys – sets of questions that you ask
   consumers
  •   Either in interviews or questionnaires.
      Market surveys should ask about:
      •   Product use and frequency of purchase
      •   Places where they purchase (competition)
      •   Business name, logo
                   Cont’d
• Market surveys should also gather info
  about future customers. Include:
  – Interests and hobbies
  – Reading and television-watching habits
  – Educational backgrounds
  – Age
  – Annual income
  – Gender
  – Etc…
2. General Research
  •   Check library resources, city agencies, city
      hall for info about businesses.

  •   If you want to open a surf shop you should
      find out how many other stores are around.
      •   Check to see what products are selling and what
          products are not.
      •   Check to see how much business they are
          actually doing
3. Statistical Research
  – Market research companies are paid by
    other companies to gather demographic
    information. The federal government can
    also provide info about demographics.
     •   Age
     •   Annual Income
     •   Ethnic or religious background
     •   Gender
     •   Zip Codes
     •   Interests
     •   Occupations
     •   Dwelling place (house /apartment)
4. Industry Research

  •   Sometimes you will need to do some
      research on an industry. If you want to start
      a record label, you will want to know how the
      industry is doing.

      •   Is it growing?
      •   Are people buying more CD’s this year?
      •   Who are the major consumers of CD’s?
      •   Which age group buys the most?
      •   What kind of music is selling?
Research Your Market Before You
     Open Your Business!
Large corporations spend a great deal of
  money on market research before they
  introduce a product or service.

Chrysler spent millions before producing the
 mini-van. It was worth it, because it was
 going to cost tens of millions to
 manufacture it.
Who is in your market segment?
• A market segment is composed of consumers
  who have similar responses to a certain type of
  marketing.

  – In cosmetics…one segment responds positively to
    luxurious products. Another segment responds to
    products that claim to make customers look younger.
    Another wants low prices.

  – A company that recognizes these segments and
    chooses one or two to market to will be more
    successful than one who tries to sell to every single
    woman in the country.
• Once you have chosen your market
  segment, you can design a survey and
  begin market research. Here are a few
  questions you can adapt to your own
  product or service.

  – Would you buy this product/service?
  – How much would you be willing to pay for it?
  – Where would you buy it?
  – How would you improve it?
  – Who are my closest competitors?
  – Is my product/service worse or better than
    those of my competitors?
 Market research can avoid costly
            mistakes
Lets say you created a design and silkscreened it
  on5 dozen white shirts. After 6 weeks you only
  sold 6. People tell you they would have bought
  a shirt if:
  –   They came in red or blue
  –   You had them in different sizes
  –   You had them in different styles
  –   The shirts had different designs
  –   The price was lower
  –   They had known you were selling at the flea market
  –   You had sold them at school during lunchtime
• With a little market research you could
  have determined your customers’ needs
  and wishes regarding the Four P’s before
  you made the shirts

  – And you could probably have sold many more
    t-shirts
         Very Good Advice
Always listen to the people who bought your
  product (or used your service) but did not
  like it.

They have valuable feedback!
               Fun fact
• Colgate Market Research

				
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posted:8/14/2012
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