Consumer Behaviour Insights

Understanding Consumer Behavior

• Market research analyzes consumer behavior to uncover patterns and support business success.
• Closed questions yield quantitative data, making it easier to analyze numerically.
• Open questions provide qualitative insights, allowing respondents to express their views without limiting answers.
• Clear and straightforward questions contribute to effective surveys; jargon and grammatical issues should be avoided.
• Leading questions, which suggest a specific answer, can compromise research reliability and should be eliminated.
• Limiting questionnaire length increases response rates; overly long surveys can discourage completion.

Methods of Market Research

• Primary research involves collecting original data that previously did not exist.
• Businesses may conduct primary research independently or through market research agencies, although agency costs can be prohibitive for small businesses.
• Accurate research typically requires questioning or observing the entire consumer population, though this is often impractical.
• Sampling a representative section of the target population is a common approach to gather insights.

Primary Research Methods

• Questionnaires/Surveys: Lists of questions widely used to extract consumer opinions.
  • Good questionnaires contain both open and closed questions.
• Postal Surveys: Sent to individuals who complete them at their convenience; tend to have low return rates.
• Online Surveys: Gaining popularity due to low costs and efficiency; can yield quick feedback.
  • Many businesses utilize links to online surveys post-purchase for immediate insights.
• Focus Groups/Consumer Panels: Small, representative groups of customers discuss experiences for detailed qualitative feedback.
  • Focus groups are facilitated discussions aimed at in-depth exploration of customer opinions.
• Consumer Panels: Ongoing groups that provide continuous feedback but may be small in size, making them less comprehensive.

Importance of Consumer Insights

• Understanding consumer behavior helps businesses tailor their products and services to better meet needs.
• Qualitative data from open questions can reveal new business opportunities and improvements needed in services or products.

Meeting Customer Needs

• Market Size: Represents the total volume of sales in a given market, measured in terms of revenue or units sold.
• Market Share: The percentage of total sales in a market attributable to a particular company or product.
• Brand: A name, term, design, symbol, or feature that distinguishes one seller's goods or services from others.

Market Research

• Definition: The systematic process of collecting data to identify customer needs and develop marketing strategies.
• Types:
  • Primary Market Research: Collects new data directly from sources such as customers.
  • Secondary Market Research: Involves the analysis of existing data from various sources.

Primary Market Research

• Purpose: Utilizes new data to gather insights specific to the business’s needs.
• Methods:
  • Surveys/Questionnaires: Structured forms to collect quantitative and qualitative data.
  • Focus Groups/Consumer Panels: Discussions with a selected group to gather insights on products.
  • Interviews: Face-to-face or telephone interactions for in-depth qualitative feedback.
  • Product Trials/Test Marketing: Introducing products to a specific market segment to gauge reactions.

Quantitative vs Qualitative Data

• Quantitative Data: Numerical data expressed in charts, graphs, and statistics, useful for identifying trends.
• Qualitative Data: Detailed information focused on opinions and experiences, gathered from interviews or focus groups.

Secondary Market Research

• Definition: Utilizes pre-existing data, often called desk research.
• Methods:
  • Databases: Utilizes customer data from loyalty programs and previous market analyses.
  • Reports: Marketing reports that summarize trends and consumer analysis for targeted strategies.
  • Websites/Social Media: Online platforms can be used to gather data on consumer behavior and preferences.
  • Traditional Media: Newspapers and TV can provide demographic data and local market trends.

Sampling Methods

• Definition: The technique of selecting a representative group from a population for survey research.
• Types:
  • Random Sampling: Each individual has an equal chance of selection, reducing bias.
  • Quota Sampling: The researcher ensures equal representation based on specific characteristics.
  • Stratified Sampling: Population divided into subgroups, and samples are taken from each group proportionally.

Importance of Market Research

• Reduces risk by providing insights into consumer preferences and market dynamics.
• Enhances understanding of customer behavior, resulting in better decision-making and strategy formulation.
• Assists businesses in effectively quantifying demand and identifying trends for growth opportunities.

### Statement of Financial Position

• Shows a company's financial position at a specific point in time.
• Also known as the balance sheet.

Assets

• Resources owned or controlled by a business.
• Examples include cash, inventory, machinery, and equipment.

Liabilities

• Debts owed by a business.
• Provide a source of funds for the business.

Capital

• Finance provided by the owners of the business.

Non-current assets

• Assets with a life of more than one year.

Current assets

• Assets likely to be converted into cash within a year.

Liquidity

• The ability to quickly and easily convert assets into cash.

Trade receivables

• Money owed to a company by its customers.

Current liabilities

• Debts that need to be repaid within a year.

Net current assets

• Current assets minus current liabilities.
• Also known as working capital.

Non-current liabilities

• Debts that are payable after 12 months.

Net assets

• The value of all assets minus all liabilities.
• Represents the total value of the business.
• Found at the bottom of the balance sheet.

Explore the various aspects of consumer behaviour and market research strategies. This quiz examines how businesses decode consumer patterns through different types of questions. Gain a deeper understanding of the significance of both open and closed questions in analyzing consumer insights.