Marketing research is defined as, “The systematic, objective and exhaustive search for the study of the facts relevant to any problem in the field of marketing.” Marketing research may be described as a method of getting facts to be used by the executive in formulating policies and plans. It can also be defined as the systematic gathering, recording and analysing of data about problems relating to marketing of goods and services.
The main idea of marketing research is to know more about the consumers, dealers, and the products. As the business grows, the distance between the manufacturer and consumers also widens. Thus the management depends upon the marketing research as a tool in solving the marketing problems. It helps in taking a fruitful and efficient decision as to the flow of goods and services in the hands of the customers.
Scope of Marketing Research: [short points]
Clark and Clark define marketing research as “The careful and objective study of product design, markets and such transfer activities as physical distribution, warehousing advertising and sales management. Thus the scope of marketing research lies in its variety of applications.”
1. Diagnosing the current situation or problem based on detailed information.
2. Clearly identifying competitive strengths and weaknesses.
3. Constantly analyzing what is happening in the market place.
4. Planning to watch company’s strengths with market opportunities by outlining objectives for product and market development and devising strategies and tactics to achieve them.
5. Watching out continuously for threats to the achievement of those plans.
6. Monitoring the progress of strategy implementation.
Scope of Marketing Research
- Size of market
- Analysis of Market Shares
- Selecting the Target Market
- Analysing the need or demand for new products
- Setting sales territories and quotes
- Assessing current market trends and projecting future market trends
- Selection of media that will be used for advertising, such as videos, images, articles, blogs, podcasts, etc.
- Selection of advertising channels
- Studying promotion elements
- Positive and negative effects of advertisement in society and market
- Advertising role at different stages of product life cycle
- Government restrictions on advertising
- Studying competitors’ advertising strategies and practices
- Studying pricing policies
- Studying offers and discounts
- Comparing the quality and price
- Use of various strategies for setting prices
- Pricing strategies on different stages of the product life cycle
- New product and pricing policies
- Studying various distribution channels
- Selecting from direct and indirect distribution channels
- Studying online marketing
- Studying factors and strategies used for distribution
- Study on physical distribution and ancillary services
- Legal issues related to distributions
- Characteristics of product
- Uses of product
- Studying other competitors available in market
- Studying about problems of consumers.
- Studying the lifecycle of products, packaging, sale, etc.
- Determining the uses of existing products
- Finding out the need for new product development
- Product life cycle
- Consumer Adoption Study
- Studying sales methods that are currently being used
- Analysis of sales records
- Management of sales force with parameters such as size, control, etc.
- Studying the sales department
- Study of advertisements, incoming customer traffic, etc.
- Study on activity and effectiveness of salesmen
- Availability of product-related resources
- Long-term and short-term goals of the business
- Social, financial, and cultural factors that affect the business
- Income, economic growth, and Policies for business
- Impacts of Acts and Legal Provisions
- Technological Aspects
Objectives of marketing research:
1. To understand the economic factors affecting the sales volume and their opportunities.
2. To understand the competitive position of rival products.
3. To evaluate the reactions of consumers and customers.
4. To study the price trends.
5. To evaluate the system of distribution.
6. To understand the advantages and limitation of the products.
7. To find new methods of packaging, by comparing other similar packages.
8. To analyze the market size.
9. To know the estimation of demand.
10. To evaluate the profitability of different markets.
11. To study the customer’s acceptance of products.
12. To assess the volume of future sales.
13. To study the nature of the market, its location and its potentialities.
Advantages of marketing research:
Marketing research has several advantages. They are:
1. Marketing research is used to measure market potential, characteristics and share of markets for a company.
2. Companies can use marketing research to evaluate new product opportunities and product acceptance and to test existing products relative to the competitor’s products.
3. It helps to make better advertising decisions by evaluating the effectiveness of marking activities and draws attention to a potential problem.
4. It helps the manufacturer to adjust his productions according to the conditions of demand.
5. It helps marketing of goods in efficient and economical way by eliminating all types of wastage.
6. It helps a dealer to find out the best way of approaching potential buyers.
7. It helps to find out defects in the products and take corrective steps to improve the product.
8. It guides a dealer in planning, advertising and promotion effort.
9. It facilitates to evaluate the selling methods.
10. It helps to minimize the risks of uncertainties.
11. It helps in exploring new markets for its products.
12. It guides a firm in making sales forecasts for products.
13. It is quite helpful for a firm to launch a new product.
14. It helps the firm in knowing general conditions prevailing in the market.
15. It helps in determining pricing policies and pricing strategy of competitors.
Types of marketing research:
There are different types of marketing research depending on the objectives that the research is designed to achieve and the sources of data which are to be used. Marketing research may also be either qualitative or quantitative depending on the form of data generated and the degree of mathematical accuracy level to which it is subjected. The most widely used category of marketing research is based on the functional objective of investigation.
Marketing research can be defined as:
1. Exploratory
2. Descriptive
3. Casual, and
4. Predictive.
1. Exploratory Research:
Exploratory research gives valuable insight, generates ideas and hypotheses rather than measuring or testing them. “Exploratory research is concerned with identifying the real nature of research problems and perhaps of formulating relevant hypotheses for various tests”. Crimp stated that the researcher undertakes exploratory research in order to generate an adequate basis for designing research and it includes searching for data that are already available both within the company and from external sources, consulting experts, conducting observational studies, getting feedback from market place and surveys.
A marketing researcher uses this type of research when very little is known about the problem being examined. The major benefit is that it is less expensive and less time-consuming. For example, if a researcher is interested in finding out “Which features or factors are vital in a purchase decision? and “What will be the best mode of communication to reach the consumers? For all these purposes, exploratory research gives an insight into the problem.
2. Descriptive Research:
Descriptive research is concerned with measuring and estimating the frequencies with which things occur or the degree of correlation or association between various variables. It has been seen that market research reports are often descriptive and they measure market size, market structure, and the behaviour and attitudes of consumers in the marketplace. In general as the data obtained by descriptive research is put to various statistical analysis, it is very necessary to make a list of the variables to be investigated and how these variables will be measured.
3. Causal Research:
Causal research is basically concerned with establishing cause and effect relationship and an attempt to explain why things happen. For example, to what extent the price elasticity of demand or the degree to which advertising campaigns have affected the sales may be explained by causal research.
However, there are two important aspects of causal research:
(i) Necessary condition and
(ii) Sufficient condition which should be kept in mind.
An event may be considered as the cause of another event, if its occurrence is the necessary and sufficient condition for the latter event to take place. A necessary condition means that the caused events cannot occur in the absence of the causative event. A sufficient condition means the causative event is all that is needed to bring about the caused event.
4. Predictive Research:
The main purpose of predictive research is to arrive at a forecast or prediction or some measurement of interest to the researcher. The ultimate target may be the future sales level of the firm. Other goals of predictive research may involve industry sales level, projection or growth or defining of firm’s product line and the use of a test market to predict the likely success of a new product.
