Market research indicates decisions made by a business, in this case Tesco, by helping the decision makers understand undercurrents of its market. This process involves research done on customers, competitors and the overall marketing environment. For example, when Tesco is promoting a product, they need to know the likes and dislikes of their targeted consumers in order to target the correct market successfully. They would also be required to research about their competitors, to find out if by any chance they offered a product that was similar, and how they would differentiate their product from it. Also, as an overall, they would be required to research the environment of the market, as well as the size of their target market, in order to decide how they are going to offer the product to the consumers. Example: sold in store, online, or both.
Primary and Secondary Research
There are two types of research:
Information for these types of research can be done internally – within the organization, or externally, from another organization or source of information outside the organization, in this case Tesco. When information or data is gathered for a certain purpose and has not been gathered before is known is primary research. Internal primary research data source could consist of:
•The business’s sales figures of products
•A central database holding customer data
External primary research data source could consist of:
•Various questionnaires and surveys
•A variety of focus groups and interviews
When data or information that has been collected before, either internally or externally, is used for research is known as secondary research. Another name for secondary research is ‘desk research’.
Internal secondary research data source could consist of:
•Sales and regional reports
•Market research gathered in the past
External secondary research data source could consist of:
•Websites and trade journals
•Newspapers and books
For business like Tesco that operate in many different fields, secondary research is more cost-effective, before they decide to conduct primary research. This allows Tesco to have a better understanding of the market, as well as recognize any major obstacles before conducting expensive research. Secondary research also allows them to make assumptions based on similar products and therefore, once primary research is conducted, it can be used against the assumptions to evaluate and compare. This will help indicate how much primary research they are required to do and therefore they don’t end up doing too much that is not required. However, Tesco is required to take the limitation of secondary research into consideration: •The information may be outdated
•The information may be biased in order to promote particular causes •The methods used to collect the research may be unreliable.
Qualitative and Quantitative Research
Research methods can be qualitative, quantitive or can include both methods. Well-planned market research consists of both methods in order to result with a good combination of information revealing different things about the same market.
Qualitative research is one-sided and normally unrestricted. It normally is gathered through interviews with customers or focus groups and therefore result in a wide range of research based on personal experiences and feelings. A qualitative question allows the individual go give a broad answer and not based against options. Qualitative research can be used to:
•Find the perceptions of customers about an organization or brand. •Discover how changes in price and other factors affect customers and spending decisions. •Explore customer preference, interests and other factors.
Quantitative research involves numbers and figures that can be examined mathematically or...