MRP302B
Request for information Study Unit 1
Introduction 1. The start of market research
There are two major roles in the research industry: Market research always starts with
D The Research Supplier: A company or agency who specialises in 1) a problem
market research. They conduct surveys on behalf of the research OR
users. 2) an opportunity
D The Research User: Buys research from the research supplier. OR
3) a problem and an opportunity
The objective of this module is to prepare students for the role of a
RESEARCH USER It is important to critically reflect on the origin(s) of a problem to find the
‘correct’ cause(s). Be aware of the assumptions that have been made.
Brainstorm every single cause that could have resulted in the situation.
Then examine each possible cause and either retain or discard it as a factor
to be investigated.
Once all the information has been gathered, decide on whether the
reason for the research is
a) a problem experienced
OR
b) a potential opportunity
OR
c) a combination of a problem and opportunity.
The role of a researcher in an organisation is critical as the researcher is Once a problem and/or an opportunity has been identified the question is:
the link between the business and the customer. To conduct or not to conduct market research?
The researcher is the voice of the customer, ensuring that the The first step in the research process is to examine the reasons why
organisation: research is being required and what decisions will be taken as a result of
• Knows who the customer is the information gathered.You need to determine what information is
• Knows what the needs, wants and expectations of the customer are already available and whether it is necessary to conduct a research survey.
Understands customers’ likes and dislikes
• Understands customer behaviour etc. Determining the research purpose sets the stage for the rest of the
research plan because it lets everyone with a stake in the outcome of the
Notes by Chrizel Breytenbach
, MRP302B
research (e.g., researcher, internal client, supplier, etc.) know what the marketer may suspect there is a difference between the purchasing
purpose of the project is as well as ensuring that all their needs and habits of one type of customer vs. the behaviour of another type, e.g.,
expectations are covered. It also establishes the urgency of the research. male vs. female or old vs. young.
Marketers and business decision-makers use research to support Tip: Each of the previous situations discussed are described purposes
decisions in five important ways: (reasons) for doing research. However, Purpose 1 – 4 can also be
D Explanation: Possibly the most cited reason for conducting undertaken as a hypothesis test, e.g., the sales manager might have a ‘gut
research is to use it to explain why something is occurring. Most feeling’ for why the sales are declining and can use hypothesis testing to
often this means identifying and explaining a problem the marketing test his/her ‘gut feeling’.
organisation is facing. For example, marketers may seek to know why
sales in a certain geographic region are declining when they were 2. The role of market research in the business
forecasted to rise. It is important to take note that marketing research is undertaken
to support a wide variety of marketing decisions.
D Prediction: Research is used to help assess a situation and predict
what may happen in the future. This type of information is critical in TIP: The business problem (the decision that a business must make to
decisions such as forecasting demand for a new product, developing address the business problem) will enable you to identify the type of
business strategies and setting business objectives and targets. It is research.
also used to predict what may happen if something is changed such as
a key marketing variable decision (e.g., the effect on sales if there is a TIP: The business problem will quite often be of such a nature that it
price increase). requires more than one type of research, e.g., Evaluating a product can
include the following types of research:
D Monitoring: In many cases implementation, following a decision, o Product usage and needs
needs to be monitored to ensure that goals are being attained. A o Understanding the target market
sales manager, for instance, will look to monitoring research in order o Evaluating the distribution channels Evaluating the pricing strategy
to track the performance of the sales force in meeting sales targets. o Evaluating packaging
o Branding of the company and the product Competitor analysis
D Discovery: Businesses are continually on the lookout for ways to
improve their products, service, communications, strategies and
marketing efforts in order to become more competitive. Discovering
or anticipating new consumer needs, changes in behaviour and/or
attitudes can also help a business to be a step ahead of its
competitors.
D Hypothesis testing: Businesses and marketers use research to
help test theories or ‘gut feelings’ about some issues. For instance, a
Notes by Chrizel Breytenbach
, MRP302B
The types of research and/or data analysis that can be implemented to Pricing Price elasticity analysis, optimal
support a decision: price setting, discount options, the
The decision Types of research and/or impact of price
data analysis increases/decreases, pricing
strategy (competitive, cheapest or
Who is my target market? Sales figures, market size, exclusive)
demographic profiles, demand for
the product, customer
characteristics including attitudes, External factors that will Competitor analysis, legal
beliefs and behaviour, purchase influence consumers’ behaviour, environment, economy, politics,
decisions, customer satisfaction, attitudes, etc. technology, social and cultural
online/search behaviour trends
Product development Product usage, product or Other Company/brand awareness and
(New or enhanced) functional needs, package design, image vs. competitors
packaging awareness, product
names, product awareness, product Table 1: The different types of research associated with a business decision
and brand preferences, product
positioning, competitor offerings Sometimes there will be a request for research but there is not
sufficient reason to conduct a research project.
Distribution (The best/ most Online vs. bricks and mortar, local Typical situations are:
cost- efficient way to sell the vs. global, site selections, number of • The information needed is already available
product or service) outlets, look and feel of outlets, • The cost of the survey is more than the expected value or return
layouts of outlets, size of retail on investment (ROI)
outlets, number of staff and level of • Not sufficient resources available e.g., budget
service • Might risk the potential competitor advantage e.g., competitors
become aware of a new product under development
Promotion/ marketing The best advertising medium, • Timing: The product or marketing manager requires the information
(including impact of social media), rather urgently (within a week) but it will take the research agency
messaging, look, feel and tone of a minimum of 6 weeks to complete the project
communication, advertising recall, • It is not clear what information is required and therefore the
direct marketing messaging and research objectives are not well defined.
response rates, sponsorships and
other supporting campaigns, the
shelf life of the campaign
Notes by Chrizel Breytenbach
, MRP302B
CASS Activity questions: Scenario 3 – Cancelling monthly statements:
Here are 4 business/market scenarios. Read through all 4 scenarios and Yes, research can assist the bank in making the right decision before
then answer questions 1 and 2 for each of the 4 scenarios. implementation the new strategy ensuring that they take customer needs
and behaviour into consideration.
Scenario 1: A foreign manufacturer wants to know if there is a market in
your country for electronic products that operate from alternative power Scenario 4 – Colour of credit card:
systems. Probably no to conduct research because of product usage and needs.
Customers use a credit card because of access to easy credit, the ease of
Scenario 2: A paint manufacturer has developed a new paint remover that is swiping a card and the security as they do not need to carry cash. The
superior to any of the current paint removers on the market. Customers colour of the credit card is not usually a driving factor when deciding to
will use a lot less of the paint remover, only one coat of paint remover is apply for a credit card or not.
required and it reacts immediately on the painted surface which saves a lot
of time. The manufacturer wants to know whether potential consumers QUESTION 2: If you decide to conduct market research,
will also think it is a superior product and whether they will buy it at a what type of research project will it be?
higher price tag.
ANSWER: Scenario 1 – Foreign investor:
Scenario 3: A bank is trying to cut down on its expenses and is considering Product usage and needs: Is there a need for the product? How will they
stopping sending its savings account customers monthly statements but is use the product?
concerned that customers will close their accounts and move to another Understanding the target market: Who are the potential customers?
bank if they do not receive monthly statements anymore. Branding and positioning of the company and the product: How to market
to potential customers?
Scenario 4: A bank is changing the design on its credit cards and wants to Competitor analysis: Who are the competitors, what products do they
know what colour the credit card should be. offer, who are their customers, how do their product(s) compare with this
product, etc.
QUESTION 1: Is it necessary to conduct market research?
Scenario 2 – New paint remover product:
ANSWER: Scenario 1 – Foreign investor: Product usage and needs: Understand which products customers currently
Yes, it will be necessary to conduct some research as it is a foreign investor using, how they are using it, what are their likes and dislikes
who might not have sufficient knowledge and understanding of the local Understanding the target market: Who are the potential customers. How
market before investing money will they use the product?
Branding and positioning of the product: How to position the product that
Scenario 2 – New paint remover product: potential customers will believe the superiority of it
Yes, there is a need for research as it is a new product and significantly Pricing strategy: Investigate how price-sensitive the potential customers
more information is needed to ensure that the product not only meets the are and at what point will the product become too expensive
needs of customers but that it is also launched efficiently.
Notes by Chrizel Breytenbach
