Purpose and Scope of a Market Research Report

PURPOSE AND SCOPE OF A MARKET RESEARCH REPORT

It is often said that market research represents the voice of the consumer in a business; and its purpose is to help a business make better decisions about the development and marketing of products and/or services. (These can be new products / services aimed at existing or new markets; or it can be existing products / services aimed at existing or new markets.) Market research is an elaborate activity, addressing at least the following aspects, aimed at establishing suitable marketing strategies:

* characteristics of the product / service;

* the macro-environment (demographics, economic trends, political and legal issues, technological

developments, and socio-cultural trends);

* buyer needs, wants and behaviour;

* market segments;

* competitors;

* analysis of the above aspects and matching them with own abilities; and

* reaching conclusions about suitable marketing strategies.

There is a subtle difference between market research and marketing research. The latter is a sub-set of the former, specifically aimed at defining the best marketing strategies, once the market had been characterised.

Before data can be gathered and analysed as part of market research, the data needs and potential data sources must first be defined. Data can be obtained from both internal sources (e.g. sales and cost forecasts) and external sources. Primary external sources include consumers, retailers and wholesalers, while secondary external sources include government and trade association publications, and media reports. It is important to seek reliable data sources, and not to merely focus on the easily accessible ones.

Once data needs and potential data sources had been defined, research methods for gathering the data must be defined. Two main types of research are commonly used for this purpose:

* Exploratory research, which uses secondary external data, case studies, and interviews with

knowledgeable people in order to learn more about the nature and scope of the market. Focus groups (6 to 12 consumers discussing potential new products / services) are often used for exploratory research.

* Conclusive research, which is used to test alternative product / service concepts. It either entails descriptive studies, using available demographic, use pattern, and other statistics; or it entails experimental research such as small-scale test markets.

Internal data can be obtained by questioning of relevant people in the organisation, or from internal reports; while secondary external data is mainly obtained in printed format. The two