Unit 17 Marketing intelligence


Unit 17
Market Intelligence







Table of Contents




INTRODUCTION
A consumer is that person who is engaged in the consumption process. The behavior of consumer denotes that activities at both mental and physical level that reflects the totality of consumer decisions with regard to acquisition, consumption and disposition of products or services (Best, 2014). In this assignment an understanding about the consumer behavior will form the basis of study of different market segments. The entire assignment is divided in to 4 major tasks. The first task discovers the stages of customer decision making process along with the different theories of consumer behavior in terms of individual and market. It also discusses the factors affecting buyer behavior and the relationship that exist between the brand loyalty, corporate image and repeat purchasing. In Task 2, a study on evaluation of different market research techniques is done. It also describes the various sources of secondary data and their reliability to achieve marketing research objectives. Task 3 discusses the different market trends and analysis of competitor for a given organization. It also explains the opportunities and threats an organization faces for a given product or services. The final Task comprises of study of customer responses. In this Task a complete customer satisfaction survey is being carried out.
TASK 1
1.1 Describe the main stages of the purchase decision-making process.
In the purchase decision making process, customers have to go through five such stages which are very essential for making marketing related decisions. These stages are:
  • Need Recognition
  • Information Search
  • Evaluation of alternative
  • Post Purchase Evaluation
The whole process of purchase begins from the first stage of need recognition which points that need or problem like hunger which derives him to go for purchase. Desire can also be the deriving factor for the customer such as the aroma of a chocolate muffin can attract a customer to buy it. In second stage of information search customer tries to obtain information about the market from various means like from family, friends, neighbors or advertising or retailers or by testing (Blas, 2012). If the need of customer is strong enough then he does not go for searching information and rather buy the product or service close to hand. The next stage is evaluation of alternative in which the customer choose between the available alternative brands, products or services by using the information gathered in the second stage. When the evaluation process is done with then customer goes for purchasing the product or service. In the final stage of post purchase evaluation it depicts the feeling of satisfaction or dissatisfaction of the customer with the purchase. In case of satisfaction, customer prefers to stick to the particular brand and in case he is not satisfied then he can go for other alternative in his next purchase.
1.2 Explain theories of buyer behavior in terms of individuals and markets.
The theories of buyer behavior can be categorized in 4 major theories. These theories are based on the basic assumptions such as economy is free and perfect, when income increases consumption also increases and spending habits remain same.
Economic theories
These theories on consumer behavior focus on the allocation of income by the consumer and its affect on the demand of various goods and services. The economic theory includes many factors like marginal utility concept, psychological law of consumption, relative, absolute and permanent income hypothesis concept which affects the customer buying decision. The economists gave the view point that man is rational in all the activities (Jobber, 2010).
Psychological theories
The psychological theories explain the impact of various experiences consumer faces on their future purchase decisions. Brand loyalty plays a significant role in forming the basis of consumer’s learning which thereby influence their purchase making decisions for the goods or services.
Psycho-analytic theories
This theory was derived from the thoughts of Sigmund Freud. He developed three dimensions about the personality, the id, the ego and the super ego. Interaction of these three systems forms the basis for analyzing consumer behavior in terms of market.
Socio cultural theories
This theory depicts how an individual’s culture, society, social class’s reference groups and family affects his behavior regarding the purchase decision making. As it is asserted that a person’s wants and behavior are mostly influenced by the society of which he is a member (Baines et al, 2011).
1.3 Explain two factors that could affect buyer behavior.
There are various factors affecting the buyer purchasing behavior like personal, social, psychological and cultural factors. Here, only two factors personal and social are explained below.
Personal factors highly influence the buyer behavior. Some of them can be categorized as buyer’s age, occupation, economic condition, standard of living, personality and self concept. With the change in age, a buyer’s preferences also change. The economic status, lifestyle and occupation of the buyer is also a determining factor about the place of shopping and kind of products consumer can purchase keeping in mind their budget. The unique factors of individuals like their personality and self concept determine their buying decision and preferences for a product or service (Peter & Donnely, 2007).
Social factors constitutes the buyer’s family, social class, colleagues, friends and the buyer’s role, status in the society which impact his purchase making decisions. Family have the strongest influence on the behavior of purchaser as the requirements of children and other family members are to be fulfilled first. Co workers and friends also influence the consumer behavior because of the sense of belonging they provide to the concerned consumer. In order to get fit in their circle the buyers tend to purchase product so as not to be left out. The role and status a person possesses also determines the purchase choices due to the expectations from their position or roles. In this way all the social factors play some or the other role in determining the purchase decisions of a individual.
1.4 Evaluate the relationship between brand loyalty, corporate image and repeat purchase.
Brand is that name, logo, sign or design that serves as the identification for the product, place, service or person. It serves as identification for its owner too and thereby provides legal protection also. Branding is very important as it gives the company the advantage of referrals from its satisfied customers to their friends and family due to the standard price it offers to the customers. It also benefits in low cost of advertising for the company, in generating huge profits and in brand recognition and brand extension (Chambell et al, 2012).
Corporate image of a company denotes the reputation of the company and the company’s perception in the eyes of its customers and employees. The corporate image of a company is the result of company’s own actions.
Repeat purchase depicts the decision of the consumer to purchase the same product or service earlier purchased by him. The relationship between brand loyalty, corporate image and repeat purchase does not suggest that repeat purchase is only done due to brand loyalty. There can be numerous factors for repeat purchase like convenience of customer or lack of viable alternatives. The study regarding their relationships shows that corporate image affects branding as due to positive corporate image of the company the brand loyalty of their product or service improves. In such a case the loyal customers are ready to pay higher price for their favorite brand. So, it can be concluded that the positive corporate image of a company helps in enhancing and improving the brand loyalty among the customers and the improved brand loyalty eventually results in repeat purchase by the customer.
TASK 2
2.1 Evaluate different types of market research techniques.
Market Research is a process in which data from customers and business clients is collected to form the basis of research. Companies use market research technique to measure customer satisfaction level regarding their product or service and it also provides the data about the industry and the competitors. There are two different types of market research techniques, Primary research and Secondary research (Stevens et al, 2005).
Primary Research
The information or data collected by primary research technique is through own personal system of company or through the help of market research agencies. This type of data collected is highly reliable as it is collected from primary sources. In order to find out answers for specific questions such type of research is conducted by the companies. The research can be conducted in many ways like through face to face surveys, online questionnaires and tele-interviews.
Secondary Research
In this research technique the information is derived from the available sources such as available case studies or industry wide research. As this technique focuses on available sources, it is less reliable as compare to primary research. The data that has been previously discovered is used in the form of published data. For entering in to a new market, companies use this technique to research the level of competition that exists in that particular market (Kotler, 2008).  
2.2 Explain how secondary sources of data can be used to achieve marketing research objectives in the marketing contexts stated in the scenario.
Sainsbury retail store can take help of secondary sources of data collection for getting the information regarding the competition in the area of retailing. A thorough examination of secondary sources can help in generating a great deal more information. Such research will help them in gaining information regarding the industry in the specific area where they desire to expand their operations and about the competitor’s market share in the industry (Laermer and Simmons, 2007). The resources that can be used by them for obtaining proper information for their market research purpose are:
  • Reports of Market research.
  • Collect secondary information on UK retailing industry from reliable sources.
  • Collect secondary data on existing retailers already operating in UK from available sources like wikipedis.org.
  • Collect secondary data on products that need to be retailed from available sources.
Sainsbury can collect information from
*        European Directory for information sources on Marketing
*        Directory on Information sources of business information
Moreover, information from Trade associations and Publishers of information can be gathered too.
2.3 Assess the validity and reliability of market research findings.
In order to assess whether the research is done well or not, the reliability check of the research findings has to be done. Reliability measures the consistency of scores over a specific period of time. It has the ability to produce a consistent result in case of repeated measurements. Initially, the measurements are to be checked as there are chances of errors that may exist in the measurement process. Firstly, there may be systematic errors that are caused due to biasness in the implementation of research. There may be random errors which are unexpected in the measuring process. Several methods can be used to assess reliability of market research findings such as Test-retest method, Alternative forms reliability and internal consistency reliability method. Reliability of research can be gained by enhancing the number of measurements instead of scores with the use of good experimental control so as to reduce random factors (Baker, 2008).
Validity is used to measure the research findings to know what a test intends to measure. Different ways of checking validity of the research findings can be used like internal validity which defines the cause and effect relationship in the study or external validity which signifies that the findings are true for general people and not just the people involved in the study. The mostly used technique is content validity as it is a speedy and easy way and consumes less time. Also the experts can be asked about the topic for assessing the scale.
It is a typical theory that if a measurement procedure is not reliable then it cannot be termed as valid while the measurement can be regarded reliable even if it is not valid. If the research findings are not reliable and valid then it will be completely disregarded and will not be regarded trustworthy.
2.4 Prepare a marketing research plan to obtain information in the given situation.
In order to obtain adequate findings there is need to conduct a market research plan. The research plan can be conducted in two ways, by using quantitative approach of research plan or by using qualitative approach of research plan. The quantitative approach discuss about the volume related aspects while the qualitative approach studies the targeted customers range of behavior and their feedback toward the efficiency of product or services they are getting (Homburg et al, 2012). As per the study of scenario given regarding the Siansbury’s business, they have given a statement regarding their strong values and culture and their commitment towards attaining operational excellence. Their efficient services indicate towards the strong inventory hold and good customer service parameters of the business. In order to investigate about the quality of customer service parameters, the qualitative measure of research should be used. Under this measure, a customer survey comprising of a set of questionnaire is needed to be conducted to investigate the findings. The feedback of the customers would form the basis for analysis and for determining the result of whole marketing research plan.
TASK 3
3.1 Assess market size trend within a given market.
Tesco is a UK based international chain of supermarket and has both global and domestic market share. The website of Tesco www.tesco.com has ranked as world’s largest online grocery store. Its customer base is around 1 million and it attracts more than 25000 orders per week. Tesco comprises 25% market share of UK retailing. In UK it controls over 30% of the grocery market. It also deals in clothes, consumer electronics and financial services and internet, telecom services (Reid and Bojanic, 2010).
In the recent years Tesco has struggled a lot to with regard to discount chains Aldi stores ltd and Lidi UK Gmbh which reduce prices to retain customers. The latest data shows that Tesco grocery market has shrunk to 28.7% from 29.6% within 12 weeks. Due to discounters that are stealing sales it also experienced fall in the sales to 11.1% down from 11.8% a year ago (www.theguardian.com). The overall market share raised the pressure on Tesco. Tesco can opt for merging alliance with another company in order to improve their services and to overcome their threats and weaknesses.
3.2 For an organization of your choice plan and carry out competitor analysis.
Acer is a UK based third largest global online market for PC. It was established in 1976. It is a hardware and software services company dealing in design, marketing, sale and support of innovative products.
The main competitors of Acer are Dell Inc., Apple Inc., Lenovo Group Limited and Hewlett Packard Company
Competitor Analysis – Market Share
*        Dell Inc. – 23.1%
*        Lenovo Group limited- 20%
*        Apple Inc.-22.3%
*        Hewlett Packard Company- 25.4%
*        Acer – 21%
SWOT ANALYIS OF ACER
Strengths
  • Pricing structure tiered in three layer-low, medium and premium
  • Merger alliance with BenQ and Ferrari brand companies.
  • Ability to find new market.
Weaknesses
·         It’s declining market share in the established market.
·         Too many brands in the market.
     Opportunities
  • Continue efforts to find new market
  • Work on relationship with other Taiwanese companies to find new technology and efficiencies for laptop.
     Threats
  • Less need of PC due to launch of ipad and iphone market.
  • New app invented by a competitor that affects the entire industry (e.g. Apple).
  • Becoming hard to maintain brand awareness.
Recommendations to Acer
Acer should put efforts to build the product on a transnational basis. Acer has to maintain a balanced scorecard with alliances like BenQ, Ferrari, McAffee and Taiwanese manufacturers (Britten, 2012).
3.3 Evaluate this organization (stated above) potential opportunities and threats.
UK online PC markets are growing rapidly and will continue to grow for future years. So, the Acer has a lot of potential for success with rapidly growing markets. When the demand rises, there are chances of arrival of more companies to come forward to fill the gaps thereby rising the competition on a whole. The potential opportunities of Acer in this market environment are to make efforts to find new markets for its products so as to increase its market share. Acer has to pay attention on its business relationship with other Taiwanese companies so as to gain new technologies with more efficiency from these companies (Kent, 2013). The potential areas of threats for Acer can be the disintermediation move used by the other competitor companies like Dell. Using this strategy Dell has the opportunity to go direct to the public. Another threat coming in the way of Acer is its difficulty in maintaining brand awareness outside of cost leadership. Also the arrival of ipad and iphone has disturbed the overall demand for PC thereby posing a serious threat for Acer.
The whole analysis clearly shows that Acer needs to focus on creating a new market to gain a competitive advantage outside of cost leadership by developing an entirely new app or technology where other brands cannot compete.
TASK 4
4.1 Evaluate techniques of assessing customer response.
In order to assess customer responses several techniques can be used but the two most widely used are face to face questionnaire and an online questionnaire. Survey and questionnaire give the feedback of the customers and help the companies in learning responses of their customers, employees, vendors etc.  The survey about customer allow the companies to improve their customer service and the survey about the employer help in improving and managing morale of employees and help in their retention too.
Face to face
Due to the fact that such surveys are of personal nature, its result may not be truthful. It is the cheapest way of conducting survey but is very time consuming. For successful implementation of face to face questionnaire, it must be carried out in a conversation way and not in a way of interrogation (Gregson, 2008).
Online
Online questionnaire can be analyzed further by exporting data to spreadsheet. As there is no need of field work unlike face to face survey, online survey can obtain huge volume of interviews in short span of time. Also this survey does not need the presence of interviewer in the survey procedure.
4.2 Design and complete a customer satisfaction survey for Sainsbury retail store.
Customer Satisfaction Survey
First of all in the designing of survey, basic questions are needed to be asked first like   the customer’s name, age, level of education etc. Following questions regarding Sainsbury’s products or services are to be asked from the customers.
1. Are you satisfied with the type of services and products offered by Sainsbury?
*        Fully Satisfied
*        Little Satisfied
*        Not satisfied
*        Not availed yet
2. Do you know about the return policy of Sainsbury?
* Yes
* No
* I don’t know
3. Would you prefer to be responded to via call or email in case of enquiry?
* Email
* Call
4. Did you feel confident that your issue had been fully dealt from the call you received when you emailed Sainsbury Customer Service.
* Yes
* No
* I don’t know
5. How satisfied are you with the way your issue was dealt with?
* Very Satisfied
* Quiet Satisfied
* Little Satisfied
* Very Dissatisfied
6. How satisfied are you with the way the staff treats you
* Very Satisfied
* Quiet Satisfied
* Little Satisfied
* Very Dissatisfied
7. Did our representative tried hard to resolve your issue?
* Yes
* No
8. How likely would you recommend Sainsbury to your friends and family?
* Very Likely
* Quiet Likely
* Little Likely
* Very Unlikely
9. How would you rate your overall experience with Tesco?
* Excellent
* Good
* Fair
* Very Bad
10. Would you like to give some feedback for improvements?
4.3 For Sainsbury review the success of the completed customer satisfaction survey.
As per the survey conducted the success of Sainsbury can be evaluated by preparing a summary sheet of the responses given by different customers. First of all, all the responses have to be analyzed well. For each question asked a summary is to be maintained about the majority of similar feedbacks. From there the complete response of the customers in terms of different parameters like customer query resolving service and feedback of satisfaction level of the customers can be evaluated.
Sainsbury can measure the success of the survey when a large majority of customers would give their responses for the online questionnaire survey (Philip & Gary, 2011). The customer satisfaction department would analyze all the feedbacks reported from the customers and the results are then sent to the top management for making improvements and appropriate decisions for the welfare and success of the company. Sainsbury plus point is that it tries to engage with its customers more than its competitors, to establish a more strong customer base, which also give Sainsbury a competitive edge over its competitors (quicksurveys.com).
CONCLUSION
From the above analysis of Sainsbury marketing research, it is recommended to assist the customers to develop an appropriate and strong customer satisfaction system to support the Sainsbury product. The preferred method for Sainsbury is to sell from top down, offering the standard products first to the customers in order to gain the trust and faith of customers. Also to move the focus of customers from other brands to Sainsbury, it should work on strengthening the distributor supply system for the overall development of business. A step towards employee welfare and ensuring employee retention in the organization would also help in achieving the desired level of success in the industry.
REFERENCES
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