COEUR - BCMBusiness Creativity Module

Market Research and Resource Assessment

Carolyn McNicholasc.mcnicholas@rgu.ac.uk

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DEFINITION OF MARKET RESEARCH

• “The systematic gathering, recording and analysing of data about problems relating to the marketing of goods and services.” American Marketing Association.

• “Market research is the means used by those who provide goods and services to keep themselves in touch with the needs and wants of those who buy and use those goods and services.” Market Research Society

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MARKET RESEARCH HELPS

•Select right market opportunity that is viable

•Determine size of market opportunity

•Identify potential customers

•Identify potential competitors

•Forecast revenue and expenses

•Develop effective strategies

•Know your strengths and weaknesses

•Convince lenders and investors

•Implementation and Control

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DEFINITIONS OF PRIMARY AND SECONDARY DATA

• Simple definitions:

• Primary data = data collected for the first time

• Secondary data = existing data

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SECONDARY DATA

• Collect secondary data first• Low cost and quick and easy to carry out• Involves looking for and analysing data

that already exists• Useful source of information especially in the early

stages of a project• Important to evaluate the quality of secondary data• Secondary data can be found internally and

externally• Official statistics and unofficial statistics

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SECONDARY DATA

• Size of market (volume, value)• Trends and projected growth• Main PESTE (political, economic, social/cultural,

technological, ecological) factors impacting on marketplace

• Customer analysis & buying behaviour (location, earnings, preferences, spending patterns)

• Competitor analysis (number, ease of entry, substitutes, product and service offerings, brand image, supplier relationships, etc)

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SECONDARY DATA

• Suppliers • Product research (design, modifications,

brand positioning, etc)• Pricing • Promotion • Distribution• Legal – employment law, health & safety,

VAT, PAYE, contract law, environmental law• Other - financial, property, operational, start-

up costs – will depend entirely on the idea

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LIMITATIONS OF SECONDARY DATA

• Collected for some other purpose• No control over the data collection• May not be very accurate• May not be reported in the required form• May be outdated• May not meet data requirements• A number of assumptions have to be made

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EVALUATING THE QUALITY AND USEFULNESS OF SECONDARY DATA

• Why was the data collected?• What were the original research objectives?• Who commissioned the research?• Who conducted the research?• When was the data collected? How old is the data? • How accurate are the data? • What quality standards were employed in the

research process?• What was the research design?

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EVALUATING THE QUALITY AND USEFULNESS OF SECONDARY DATA

• What was the sampling procedure and sample size?• What methodology was used?• What was the response rate?• How good was the design of the

questionnaire/discussion guide?• How were the data processed and analysed?• How consistent is the data?• Is the data comparable?

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INTERNAL SOURCES OF SECONDARY DATA

• sales

• customers

• products

• distribution

• financial performance

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EXTERNAL SECONDARY SOURCES: • Business Gateway• Commercial databases• Consumer surveys and

reports• The library• Trade associations,

journals and directories• Trade shows and

conventions• The media• The www.

• Business Directories– Yellow Pages– www.yell.com– Thomson Local (

www.thomsonlocal.com)– Kellys Business Directories– (www.kellys.co.uk)

• National and local government statistics

• Government publications

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BUSINESS GATEWAY

• Business information

• Business start-up

• Business growth

• Increasingly delivered by web-based solutions

• www.bgateway.com

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RGU LIBRARY - EXTERNAL DATA

• Business databases– journal/magazine articles (Business Source

Premier, Emerald, Science Direct, Sage, Informaworld)

– newspaper articles (European Intelligence Wire)

– Information on markets (Mintel, Key Note, Global Market information database, COBRA, Business Source Premier)

– company information (Business Source Premier) and company financial information (FAME)

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COBRA

• COBRA Business Opportunity Profiles– An Introduction to Researching a Market for

Business Start-ups (No 185 – June 2008) – A Guide to Sources of Market and Business

Information (No 47 - January 2009)– A Guide to Using A Market Research

Questionnaire (No 1 - 2008)• Note: Only 1 user at a time

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FINDING INFORMATION ON A COUNTRY

• Michigan State University global information • http://globaledge.msu.edu/resourcedesk/• The World CIA Factbook• https://www.cia.gov/library/publications/the-world-factbook/

index.html• The United Nations Cyberschoolbus• http://cyberschoolbus.un.org/infonation3/menu/

advanced.asp• The World Bank• http://web.worldbank.org/WBSITE/EXTERNAL/

COUNTRIES/0,,pagePK:180619~theSitePK:136917,00.html• The European Commissions Market Access database• http://mkaccdb.eu.int/mkaccdb2/indexPubli.htm

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FINDING INFORMATION ON A COUNTRY

• The OECD website• http://www.oecd.org/countrieslist/

0,3351,en_33873108_33844430_1_1_1_1_1,00.html• A list of national statistics offices websites produced

by the UN• http://unstats.un.org/unsd/methods/inter-natlinks/

sd_natstat.asp• Business Insight Interactive • http://www.bi-interactive.com/index.aspx?StoryID=0&

ReportID=1076&Lang=en&MainPage=home• Eurostats facts through figures• http://epp.eurostat.ec.europa.eu/portal/page/portal/eu

rostat/home

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STATISTICS WEB SITES

• Office of National Statistics has census data, population demographics, income levels, social and regional trends. Many of the sites are regional – i.e. England and Wales. Scottish equivalent is SCROL– www.statistics.gov.uk– www.scrol.gov.uk– www.nomisweb.co.uk

• Scottish Executive and Scottish Enterprise– http://www.scottish-enterprise.com/

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LOCAL INFORMATION

• Aberdeen / Aberdeenshire City Council– population trends (age, sex, unemployment)– small area population forecasts (dwellings

and populations by ward)– http://www.aberdeenshire.gov.uk– http://www.aberdeencity.gov.uk/ACCI/web/site

/home/home.asp

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GENERAL SOURCES • Department of Business Enterprise and Regulatory

Reform (www.berr.gov.uk)• Chambers of Commerce• Corporate Information (web sites, annual returns, etc)• Business.com http://www.business.com/• About.com http://www.about.com/• Strathclyde University Internet resource - BUBL• http://bubl.ac.uk/index.html• Subject specific –

– e.g., www.visitbritain.com– http://www.tourismtrade.org.uk/MarketIntelligenceRe

search/default.asp

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Business news• Updating services on topics of your choice

– www.newsnow.co.uk

– www.ananova.com

– www.newsindex.com

Looking for Property?• www.scottishproperty.co.uk

• http://www.aspc.co.uk/

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PRIMARY DATA QUANTITATIVE DATA

• Quantitative data - techniques used and sample sizes mean data can be statistically analysed–how many?–this or that?–rank the following–how large/small?–how much?

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QUALITATIVE DATA

• Qualitative data - deals with information difficult to deal with in quantitative terms– subjective opinions– value judgements

– how?– why?– what?– if?

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PRIMARY METHODS • One to one interviewing • Focus groups• Observation methods• Web based news groups• Experimentation and test

marketing (hall tests) – http://

www.youtube.com/watch?v=jDbce6ZM2oU

• Surveys – Questionnaires - mail, telephone, personal interviews

• Web based news groups

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CASE STUDY

Opening a coffee shop

in Aberdeen

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A good starting point

• COBRA Business Opportunity Profiles

– Coffee Shop

– Cafe Bar/Designer Bar

– Fast Food Outlet

– Delicatessen

– Internet cafe

– Smoothie and Juice Bar

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Size of Aberdeen market & Demographic profile

Aberdeen City Council website• Population trends for Aberdeen & Aberdeenshire • Age and gender structure of the population and

trends • Population of neighbourhoods by age• # households/ dwellings• Census – family life cycle stage, country of

origin, ethnic group, religion, number of employees and students, gender and employment, occupation groups, socio economic classifications

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Market research reports

• http://www2.rgu.ac.uk/library/resource/alph.htm• Keynote -

– Coffee and Sandwich Shops 2009– Hot Beverages 2009

• Mintel– Coffee Shops UK 2009 (Feb 2010 – to be

published)– Coffee UK 2010 (Home consumption)– Coffee Shops UK – Feb 2007– Coffee Shops – UK - 2005

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Number of Coffee Shops UK Keynote 2009

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More women than men use coffee shops (Keynote 2009)

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Mintel 2009: Targeting opportunities

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Keynote 2009 demographic analysis

• Starbucks is most popular among the 35-44 age bracket, while Costa’s popularity peaks among 25-44-year-olds, reflecting the fact that both these age groups are keen coffee purchasers and enjoy it both as a drink and a means to catch up with friends. Starbucks also attracts a particularly strong following among the 15-19 age band.

• Key analysis: The particularly youthful appeal of Starbucks suggests that the company could try to engage more with younger consumers at certain times of the day in terms of running special price-deal promotions aimed at this age group. Other ideas which could help Starbuck appeal to this group also includes offering added-value features such as making sure fashionable music magazines are available to read in store, or provide facilities to charge iPods or even download music.

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Competitive Structure – Keynote Coffee Shops 2009

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Mintel 2009: Companies and products

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GMID – Global Market Information Data Base – Euromonitor - Coffee UK 2010

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Mintel Coffee Shops- UK Feb 2007

• Antipathy to coffee from younger drinkers

• Growing competition• Dilemma over food to

offer• Coffee abstainers

(never drink coffee) rose from 13% to 20% from 2004-2006

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Coffee Shop Market (Source – Mintel – Coffee Shops – UK - 2007

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PESTE Analysis• http://www.coffeeresearch.org/• Oxfam report

http://www.maketradefair.com/assets/english/CoffeeMarket.pdf]• Google Answers – demographic profile

http://answers.google.com/answers/threadview/id/734400.html• INeedCoffee.com

http://www.ineedcoffee.com/07/coffeebusiness/• SWOT Analysis of Starbucks

http://www.marketingteacher.com/swot/starbucks-swot.html• Coffee consumption trends:The Roast and Pot Coffee

Company http://www.realcoffee.co.uk/Article.asp?Cat=trivia&Page=1

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Trade Associations

• British Coffee Associationhttp://www.britishcoffeeassociation.org/

• Speciality Coffee Assoc of Europehttp://scae.com/

• International Coffee Associationhttp://www.ico.org/

• Coffee Francise http://www.franchisedirect.co.uk/coffeefranchises/179

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Business Insights http://www.bi-interactive.com/index.aspx?

StoryID=0&ReportID=1076&Lang=en&MainPage=home

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Business Source Premier Database

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European Intelligence Wire Database

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Media : Scotsmanhttp://business.scotsman.com/fooddrinkagriculture/UK-coffee-shops-full-of.4118166.jp

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Media: Business week

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Media: Telegraph

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Caterersearch.com press articlehttp://www.caterersearch.com/Articles/2007/05/24/313851/UK-coffee-market-set-to-double-over-the-next-10-

years.htm

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FoodBev.comhttp://www.foodbev.com/report/uk-coffee-bar-market-still-growing-despite-recessi

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Competitive Product offer and pricing

• Trade associations• Competitive websites• Find local competition

– Google Coffee Shops Aberdeen– BizWiki competitors

http://www.bizwiki.co.uk/cafes/aberdeenshire/aberdeen.htm

– UpmyStreet Competitorshttp://www.upmystreet.com/findmynearest/food-and-dining/coffee-shops-listings-in-aberdeen.html

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Competitive Activity

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Competitive product offer and pricing

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Product Offer

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Product offer

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Keynote Coffee shops 2009• Costa is market leader in terms of number of outlets,

Starbucks in terms of turnover• Wider range of food and drink offerings

– Muffins, scones, cakes, cookies, patisserie, brownies, etc

– Sandwiches, rolls, paninis, bagels, croissants– Yoghurts, desserts, fruit– Juices, smoothies, milkshakes– Trend to healthier food and Fair trade coffees

• Growing competition from department stores, M&S, grocery multiples

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Case study on coffee shop

• http://brandandmarket.blogspot.com/2007/06/perk-up-coffee-shop-marketing.htm

• http://www.benjaminwarsinske.com/2010/06/case-study-coffee-shop-in-seattle/

• http://www.baristaexchange.com/forum/topics/planning-on-opening-a-shop

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Location of shop

• Size of market/ Population

• Competition

• Available venue

• Fit with positioning

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REFERENCES• CHISNALL, P., 2005 Marketing Research. 7th ed. Maidenhead: McGraw Hill. • WILSON, A., 2006 Marketing Research: An Integrated Approach 2nd ed.

Harlow:Prentice Hall. • KENT, R., 2007 Marketing Research: Approaches, methods and Applications. London:

Thomson • MCGIVERN, Y.,2006 & 2009 The Practice of Market Research. Harlow:Prentice

Hall.Chapter • SHIU, E., HAIR, J., BUSH, R. & ORTINAU, D. 2009 Marketing Research. Maidenhead:

McGraw Hill • KOLB, BONITA. 2008. Marketing Research: A Practical Approach. London: Sage • A Newcomers’ Guide to Market and Social Research

http://www.marketresearch.org.uk/mrindustry/downloads/newcomers.pdf• Davis, R.E. 1993 Experience: The role of market research in the development of new

consumer products. Journal of product innovation management. V 10 pp309-317• Von Stamm, B. 2008. Managing Innovation, Design and Creativity. 2nd Edition, Wiley • Burns, P 2007 Entrepreneurship and Small Firms 2nd ed. Palgrave Macmillan