You can say that information is the raw material of marketing. It is the fundamental tool through which companies can meet viable demand and achieve their sales targets. Normally, access to such information is hard and requires expert teams that engage in a through market research. This market research, which uses both primary and secondary information, in turn provides the organization with information regarding the deployment of a potentially successful marketing regime.
The primary information is obtained directly from the market and is generated by the company itself, making it much more expensive than secondary information, which has been previously prepared by sources outside the company, like consultancy firms, and is readily available. Here is where the Marketing Information System (MkIS) comes in. It is responsible for providing the primary information to an organization regarding its marketing decision making.
Now let us look at the various phases of a through market research process, after a brief overview of what market research actually is.
What is market research?
To define the term generally, market research is an administrative tool that uses scientific and practical means in order to provide information to the company to improve its decision - making process. – particularly regarding marketing and demand. To do this, it takes advantage of statistics and data analysis. Basically, it is a method to obtain information using means such as telephone, e-mail, direct observation or personal interviews. Thanks to these information sources and their subsequent analysis, companies can deal with specific situation in an objective fashion, such as consumer reaction to the launch of a new product, the change in packaging of an existing product, or a new endorsement deal.
The fundamental tool of market research is the questionnaire, which is a document consisting of several questions accompanied by different response options. It is used to obtain information from the person who fills it which is then used to analyze consumer trends. The analysis will be fruitful in determining the concentration of demand of the product resulting in a viable information stream for the Marketing Information System that can be utilized to make marketing decisions beneficial to the organization both in the short and long term.
Now that we have a basic understanding of market research, here are the four main stages in any process of market research:
Phase 1. Research Design
The first step in any process of market research must be to detect the problem to be solved and set goals that are to be achieved. This is important because it serves as a direction for the market research, with which it would be rudderless. Once this is done, the company can do some preliminary research that allows it to extract information about the prevailing market situation.
Phase 2. Obtaining information
The first step in getting the information is reviewing secondary data sources already available to the company to see if it can extract some information that interests its marketing objectives. Sources of such information can be articles on the internet, already published marketing studies, etc. However, if the secondary sources are not available or deemed insufficient, then the company should resort to only primary sources of information.
To access primary information, the company must first determine the method of obtaining such information. The most popular sources in this aspect are the questionnaires and general surveys, although other methods also exist like focus groups, product fairs, and likes. In any case, the company must first determine the size of the sample of the population for which the survey is to be conducted, and later outline the physical collection of information through the pollsters, by mail, survey website or any other satisfactory method.
Phase 3. Data analysis
Once the data is obtained in the previous phase, the next step will be to process this data, usually by creating a database to make it easier to work with. Then, the data is subjected to statistical analysis techniques. For this, it is quite necessary nowadays, in order to save time, to use specific software such as EViews. Comparison and analysis of the data leads to numerous graphical and statistical indices, among other indicators, which are prepared by expert statisticians.
Phase 4. Interpretation and presentation of results
Having gained the necessary statistical information in the previous phase, it will be necessary to translate this information into economic terms that can be understood by marketers of the company. For this purpose, statistical information has to be interpreted and then a report has to be prepared where recommendations on measures to be taken to achieve the proposed objectives are included.
The report should be written in the simplest possible way, so that anyone interested can comprehend it, regardless of the department they are working for. Therefore, language that contains too much data, statistical models or technicalities should be avoided, as far as is reasonably practicable. Finally, recommendations should be clearly outlined so that the objectives can be set for various departments involved in the marketing and design of the product.