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Market research at Marks and Spencer

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by

Toto Liwane

on 28 February 2014

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Transcript of Market research at Marks and Spencer

Primary research methods used
These took forms:
qualitative and quantitative data

How Primary research contributed to the Marketing plan to launch the food division
Primary research is research that is tailored to a companies particular needs; As primary research involves collecting information that hasn't been collected before or renewing it, it provides the organization with realistic up-to-date information on what their customers want. Furthermore, as the organization asked such a great number of people, it provides them with more accurate information. This would of supplied Marks and Spencer with enough information to convince them that it is a good idea.
Because of primary research, M&S was able to make a lot of decisions on their food division; such as: where to locate the stores, the quantity of food, what type of packaging appeals most to the audience and where the stores would be most convenient for certain focus groups and so on. Primary research would have developed the organization's understanding of what their audience wants and what they need to do to make their food stores unique and different to other suppliers. This would have given them a much more vivid idea of what their customers want - setting off ideas of what type of atmosphere,characteristics and look they want the store to have.
Primary research supplies the company with a much more human understanding and expectations.
Secondary research methods used
There were tow main sources: Internal and external
Market research at
The purpose of Marks and Spencers market research
Before Marks and Spencer launched their food division, they had to carry out both primary research and secondary research of the groceries market. To determine whether there was an opportunity to open the new division.
How secondary research contributed to the marketing plan
Qualitative methods
Quantitative methods
Focus group
Customer interviews
Observations
Internal sources
External sources
What were the limitations?
Secondary research is based on information sourced from studies previously performed. This form of data would of been beneficial for the organization as it would of contributed with: the competition prices, the competition marketing techniques, knowing how much the target group spend in a week and so on.
It would of also gave the organization a rough idea in understanding of the proposal of a new division was a good idea; based on the current/proposed climate of food retail.
Furthermore, it provides the organization with background information; by researching what other companies who made a similar move - analyzing what they did well, what they did not so well, reason of success or reason of failure.
This would of helped give the organization clarification on where it was the right time to make the move or not.
It gives the organization information on what types of products sell most, what the peak times are, what groups of people purchase the most, age ranges, location of most successful stores and so on.
Postal survey
Automated telephone survey
Online questionnaires
Internal reports and analysis
Retail data
Household expenditure data
Commercial data
Government statistics
Focus groups
Focus groups are a group of people assembled to participate in a discussion about a product before it is launched. Examples of a groups Marks and Spencer could of used are: parents, teenagers, students, full-time working people, part-time working people and so on. Marks and Spencer would of used this technique to understand what the public want - not just their customers. Furthermore, it gives them a lot of people groups which thye could target or not target.
Customer Interviews
Customer interviews are when customers of the store participate in an interview or a pair interview asking questions about an organisation. This is to help understand what the current customers think and to understand their opinions are. Their opinions are very valued as they're already current customers and Marks and Spencer wouldn't want to loose their business.
This will provide Marks and Spencer with a much clearer understanding of what their customers want and how they can improve their shopping experience.
Observations
Observations are when people are observed in their natural environment. Marks and Spencer could of used observations to see the selection process of focus groups when they purchase food products. To help create a successful food line, Marks and Spencer would need to understand the section process of their target group. By observing how target groups select what to buy and incorporating the information with other qualitative and quantitative factors, it would give the organization a better understanding of what products they should deliver.
Postal survey
Postal survey is a survey method in which a printed questionnaire is produced and is sent by mail to respondents for them to fill in and send back.
Although, postal surveys traditionally have a very low response rate; the responses they do get back are of very high quality. Knowing many people don't respond, businesses make the questions very simple and straight forward to answer (Quantitative questions". These would be questions like "How old are you?" these are to Gage what type of audience they have.
Automated telephone survey
Automated surveys are used to collect information and gain feedback via the telephone. This form of quantitative research is known to have very low responses and the automated program is very time consuming and most people don't have time to complete the entire survey. However, Marks and Spencer would of used this as it's another way to communicate with their customers if they can't contribute in another way. It's widening their response capability.
Online Questionnaire
An online survey is a computer-assisted web interviewing is an Internet surveying technique in which the interviewee follows a script provided in a website. Although they contain similar questions, online questionnaires receive a high response rate, purely based on the volume of people on the internet.
Marks and Spencer could use this fact to their advantage and aim certain site to certain focus groups.
Internal reports and analysis
Internal reports and analysis are financial data or other information accumulated by one individual to be communicated to another within the business entity. The information assists others in the managerial decision-making process.
This information would help determine if this is fee sable or worth it.
Retail data
Retail data is an aggregated measure of the sales of retail goods over a stated time period, typically based on a data sampling that is extrapolated to model an entire country.
Knowing the volume of sales would help the managerial decision of seeing if the new division would help up the number of sales.
Household expenditure data
Household expenditure is defined as the sum of household consumption expenditure and the non-consumption expenditures of the household.
This would inform Marks and Spencer how much money a household are prepared to spend. This would of given them an indication on how much they price their products.
Commercial data
Government statistics
Government statistics are statistics which have been collected by the Government. For example, the Census - the Census is a survey which is carried out every 10 years and every household in the UK is required to complete it.
Statistics such as these are very useful for Marks and Spencer in a situation as this; is it provides them valuable information on the entire UK. For example, they could use the Census to find out what the average number of people living in one home around an area they were thinking to open up a food store. This would be useful information as it would indicate if people would be going to supermarkets or local stores to buy their weekly food.
Primary research
Secondary research
Focus groups
Customer interviews
Observations
Automated telephone survey
Postal survey
Online questionnaire
Internal reports
and analysis
Retail data
Household expenditure data
Commercial data
Government statistics
There are a few limitation of focus groups; that it quires a lot of organizing to gathering willing volunteers, it can be an expensive process paying for facilities etc and not all results could be true as once in a group people tend to go on a majority vote not individual opinions.
The postal survey limitations are, that Marks and Spencer can only send their survey to registered customers which selected the option - which is not a big number. Furthermore, postal surveys traditionally receive very little responses. So they would have to provide an incentive to receive responses.
Online advertising is very effective in this day and age, because it's so popular, advertising online has become very congested as millions of companies are adverting online. This means that to advertise online it cost a big sum of money.
The people Marks and Spencer want to aim this telephone survey to are usually very busy with their own lives as they wouldn't have enough time to complete it as it's very time consuming. So they would avoid it.
It's hard to observe people's natural actions as they would be acting differently knowing they're being watched. So it is very difficult to say that the information collected from observational research is credible.
It will be a complicated and time consuming process to organize personal interviews. Furthermore, they would be expensive to set up.
Additionally, customers might not provide 100% honest opinions as it would be on a more personal level, so they would feel pressured in complimenting the company. Not their actual thoughts.
Government statistics such as the Census are very reliable however, they become outdated very quickly. First of all, the questionnaire is carried out every 10 years and usually not released 2-4 years later due to all of the information required to be processed.
Due to this being a new project Marks and Spencer are very limited to what internal information is relevant to help with the marketing plan.
Whenever a business is opening a new division, they want to understand what their competition is doing however they want to have their own USP also. By looking at retail data it makes it more difficult to find a USP for the organization.
Information such as household expenditure data, fluctuates a lot during a year depending on the current financial climate, and it becomes very difficult to predict the future financial climate as it fluctuates so much.
Data Protection Act
The Data Protection Act, means that Marks and Spencer are not allowed to share their customer’s information without their permission or consent.
This would limit the market research process as it would mean that Marks and Spencer couldn't sharing information without consent.
Other possible limitations
Consumer credit acts 1974 and 2006

This aims to protect the rights of consumers when they purchase goods on credit.
All traders who make such agreements must obtain a license from the office of Fair trading.

Legal limitations and constraints

This is the subjective area but the rules that tend to govern whether certain words are acceptable are based on the target audience for the marketing activity. Images and words that are relevant to the product being advertised are likely to be accepted, but may be rejected when they are unrelated to the product.
Acceptable language

Pressure groups are organizations formed by people with a common interest who join together in order to further that interest.
Pressure groups watch organizations and influence how they act. They can be extremely effective in changing organizational behavior.

Pressure groups and consumerism

Consumer Protection (Distance selling) regulations

Distance selling means selling and buying by phone, mail order, via the internet or digital TV. Such transactions are covered
generally by normal buying and selling legislation, but they are also covered by special distance selling regulations.

Legal limitations and constraints

Sale of Goods Acts 1979

This Act was amended by the sale and supply of Goods Act 1994 and the sale and supply of
Goods to consumers Regulations 2012. Under the legalisation goods bought from a trade should be:
Of satisfactory standard
Fit for any particular purpose made known to the seller
As described


Legal limitations and constraints

Constraints businesses face when
carrying out marketing activities

Data Protection Act 1998

The information obtained by consumers must be:
Obtained lawfully and fairly
Only used for the purposes stated during collection
Accurate and where needed and kept up to date
Protected from transfer to other companies
Available to inspection and correction by the individual

Legal limitations and constraints
Full transcript