There are different types of research which can be used to get the information needed for marketing research. Primary research is information which you conduct yourself when you cannot gain information from secondary research which is readily available. This information is very useful because you go the results yourself and you are able to give your own opinion of results which you have obtained. Primary research is more expensive than secondary research because you have to collect the equipment by yourself and set up the different methods of obtaining your information. Secondary research is information which has been conducted previously by someone else, it is of great use as well because it saves time as it is ready for you to use and is cheaper.
Both types of research fall under two headings, either quantitative or qualitative. Quantitative research gives you results in the form of numbers and figures i.e. measurement of product sales each week. Qualitative research is not in the form of numbers and gives you direct information on what the customer’s buy, why they buy them and what they think of what they buy. Secondary research can be either internal, where the information is held within an organisation, or external where the information is outside of an organisation.
In order to find out more about what the customers want and need the organisation can use surveys as a form of primary research. Surveys – using questionnaires via email, face-to-face, telephone or post etc. the marketers gain information on the type of products that their customers desire and can then put them on the market. It also gives the marketers information about different lifestyles their customers live and also their attitudes and motivations. For example, using a questionnaire, they can gather information about their customer which shows that they work a 9-5 job and have 3 children of whom they are trying to promote a healthy eating regime to. From the gathered information, Sainsbury’s will know that on they need to have plenty of healthy but fun foods for the kids, they might also make sure that they have products that help the customer to relax from their successful week i.e. Radox Herbal Bath Soak, scented candles etc.
From the questionnaires the marketers can apply the information about the customers’ lifestyles and behaviours into the 4 Ps in order to meet their demands. Products: the marketers will know what product to put on the shelves in order to attract their customers. They will also try to draw their customers in more by placing items on the shelf that can be used with the original item. I.e. television and surround sound system etc. Price: Sainsbury’s will have to apply an appropriate pricing strategy in order to suit their customers. This pricing strategy can be based on information that has been gathered about the customer’s income or lifestyle. Once they have applied a particular pricing strategy, they can think of a complimentary one. I.e. buy one bottle of bath foam and get another one for half price. After this they could introduce BOGOF.
Place: Sainsbury’s will place the product in a place which is suitable to the customers’ attention. Sainsbury’s also use point of sale displays near the beginning of the till so that they can get their customers to buy products which do not necessarily need , but they pick it up just because it’s there. If the organisation knows that the customer has a 9-5 job, they make facilities such as door-to-door deliveries to make shopping easier for the customer. Promotion: before putting the product up, the business need to figure out the correct promotion type that they will use. The type of promotion that they use will also be based on information gathered about the customer. I.e. if the customer is always at work they can post leaflets through the post or send emails with the products information and specific deals. By sending emails they are creating a lifetime relationship with their customers.
Secondary research enables Sainsbury’s to get quick and cheap information. It’s quick and cheap because someone has already done the research, so it’s only a matter of gaining access to the secondary research information. Using secondary research also helps in assistance to any primary research that Sainsbury’s wants to do. I.e. secondary research found can give them an idea on what people to interview for the surveys so that they can design products to suit their names. Internal secondary research can be via EPOS, which is Electronic Point of Sale. With the EPOS the system records the amount of sales per product.
Using this information is useful because it is easily accessible and it gives the organisation accurate figures. However, this data might be old and people’s lifestyles or shopping habits may have changed within that period of time. Another form of internal secondary research is website statistics; this gives Sainsbury’s information on what internet shoppers are looking for products). Newspapers such as ‘The Financial Times’ produce information on a regular basis about customer trends in the country and industry. This can give the organisation ideas on what they might need to update or improve on their website.
In order for Sainsbury’s to find out what their competitors within the industry are up to they need to look at how the opposition conduct out their 4Ps strategies. If they do not know what their opposing team is doing within each sector then they won’t know what they have to contend with. As a form of primary research the organisation can use observation to view they competition that they have.
Part of the observation method includes the ‘mystery shopper’; the researcher would visit the competitor source, i.e. Tesco, acting as a shopper to gain information that could be used to their organisations advantage. As a mystery shopper the researcher must fulfil some tasks, this includes: purchasing a product, asking questions, behaving in a certain manner and maybe making a complaint. Once they get all of the information that they need they report feedback of what happened. Using market research Sainsbury’s need to look at Tesco idea on, Product: Sainsbury’s can use the mystery shoppers to make comments on the types of products that Tesco have on their shelves and from the feedback they can see if their products are up to standards and if they need to bring new products on the market or update those that they already have. They can also see if Tesco has a new product on the market and they can steal this idea, or make it better and into their own idea.
Price: Sainsbury’s will use the ‘mystery shopper’ to look all around the shop floor of Tesco paying attention to everything that they would need to consider to beat their competitors. Once they have information on the types of pricing strategy that Tesco are using on particular products they can then come up with better strategies on the same products which will attract more consumers towards Sainsbury’s. Also, when other competitors such as Asda advertise their price comparisons on TV, Sainsbury’s has to act fast and think of ways for them to lower their prices and get more customers. Place: Sainsbury’s can use the ‘mystery shopper’ to view how the competitor places their products around the shop and feedback can influence them on new design layouts for the shop floor.
The co-ordination of how they place products near each other around the store will also help to attract more consumers because they will be able to find products more easily. Promotion: Sainsbury’s will know how to contend against Tesco by promoting better deals and also by the types of advertisement that they use. Both the supermarkets have a number of different adverts on the television, but Sainsbury’s use celebrities such as Jamie Oliver to get more people to come to their store, and Jamie Oliver promotes healthy eating which is a trend that a lot of people are starting to follow these days. Tesco also advertise on more than one of the types of products/services that they provide, and Sainsbury’s can look at these ideas and see how they can make their promotion ideas better.
In terms of secondary research, Sainsbury’s can use market analyses to help boost their marketing ideas. They can gain financial information about competitors, this will show them how much profit is being generated by the competitor and Sainsbury’s will see if they need to invest more tie or money into launching new products or promotional material. Financial information will also allow them to see whether they need to reduce the price of products in order to keep consumers buying them. The data that they receive can also give them information about how much shares people buy from the other supermarket, this will let them know whether more or less people are buying shares into their organisation than the other. If they see that more people are buying into the competitor organisation then they need to come up with ways to draw more consumers towards them.
In order for Sainsbury’s to understand the marketing environment they need to know what the marketing environment consists of. The market environment holds internal and external factors which effectively have an affect on the organisation; these factors are usually beyond the control of the organisation so they have to be able to adjust to them. The PESTLE factors have a contribution towards the market environment and how it has an effect on Sainsbury’s as an organisation. These factors are political, economic, social, technological, legal and environmental.
Another element of the market environment also involves the competition that Sainsbury’s has. Competition comes in different levels for the organisation, whether it is by selling their products as a brand name or to see how many customers go to each store. Sainsbury’s also compete in terms of the services that they provide for their customers, examples of their services include, clothing lines, insurance and banking. Other competitors have, Tesco, have Tesco mobile so Sainsbury’s are under pressure to come back with a better idea.
Economic cycles are also a part of the market environment. As Sainsbury’s is quite a large organisation, they will be affected by the economy on a different level from what another organisation might be. The economy fluctuates between increasing strength, stagnation, or slight decline. So this will also change the way Sainsbury’s operated and they have to be ready for those changes no matter how often they may occur or not. ..