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Merits and demerits of marketing research agencies

Concept, Objective, Advantages and Limitations Article shared by: Concept, Objective, Advantages and Limitations! Hence, in a broad sense, marketing management needs to understand the minds of their target markets, their attitudes, feelings, beliefs and value systems. They require a formalised, managerial approach to this most important job. And this entire job is the basic role and purpose of formal marketing research.

Marketing research is the systematic, objective and exhaustive search for study of the facts relating to any problem in the field of marketing. It is systematic problem analysis, model building and fact-finding for the purpose of decision-making and control in merits and demerits of marketing research agencies marketing of goods and services.

It is a search for data which are relevant to marketing problems — problems in different functional areas of marketing consumer behaviour, product, sales, distribution channel, pricing, ad and physical distribution. It has to be carried out in a systematic manner rather than haphazard way.

The whole process should be planned with a clear objective. It should be objective: Objectivity is more important in any result. It means that the research is neither carried on to establish an opinion nor is intentionally slanted towards pre-determined results. It is a process: It involves various steps for gathering, recording and analysing of data. Objectives of Marketing Research: Marketing research may be conducted for different purposes.

The main objectives or purposes of marketing research are: Advantages of Marketing Research: Marketing research helps the management of a firm in planning by providing accurate and up- to-date information about the demands, their changing tastes, attitudes, preferences, buying ii.

It helps the manufacturer to adjust his production according to the conditions of demand. It makes the marketing of goods efficient and economical by eliminating all type of wastage.

The Disadvantages of Market Research on New Product Development

It helps the manufacturer and dealers to find out the best way of approaching the potential vii. It helps the manufacturer to find out the defects in the existing product and take the required corrective steps to improve the product.

It helps the manufacturer in finding out the effectiveness of the existing channels of distribution and in finding out the best way of distributing the goods to the ultimate consumers. It guides the manufacturer in planning his advertising and sales promotion efforts.

Disadvantage: Groupthink

It is helpful in assessing the effectiveness of advertising programmes. It is helpful in evaluating the relative efficiency of the different advertising media.

  • That is, it is helpful in determining the sizes, colours, designs, prices, etc;
  • This exposure makes it difficult to break away from the groupthink mentality and conduct research from a neutral framework;
  • It helps the firm in knowing its market share over various time periods xxvi;
  • Not an exact tool of forecasting;
  • Time is directly related to the costs, as the longer the research takes, the more costly it may turn out for the company;
  • Time Another disadvantage of doing market research is the time associated with doing the research and performing questionnaires and interviews.

It is helpful in evaluating selling methods. It reveals the causes of consumer resistance.

Marketing Research: Concept, Objective, Advantages and Limitations

It minimises the risks of uncertainties and helps in taking sound decisions. That is, it indicates whether the demand for the product is constant or seasonal. It is helpful in ascertaining the reputation of the firm and its products. It helps the firm in determining the range within which its products are to be offered to the consumers. That is, it is helpful in determining the sizes, colours, designs, prices, etc.

  • It is helpful in evaluating the relative efficiency of the different advertising media;
  • If the company sends out an online questionnaire, not everyone can fill it out, especially those with limited Internet access, for example;
  • Promptness of Fieldwork — a combination of online research with opt-ins leads to speedy data collection.

It is helpful to the management in determining the actual prices and the price ranges. It is helpful to the management in determining the discount rates. It is helpful to the management in ascertaining the price elasticity for its products. It helps the firm in knowing the marketing and pricing strategy of competitors. It is helpful in knowing the general conditions prevailing in the mark xxiv.

It is helpful to the management in finding out the size of the market for its products. It helps the firm in knowing its market share over various time periods xxvi. It is quite helpful to a firm in launching a new product. It helps the firm in knowing the transportation, storage and supply requirements of its products. It helps the firm in exploring new uses for its existing products and thereby, increasing the demand for its products.

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It is helpful to a firm in making sales forecasts for its products and thereby, establishing harmonious adjustment between demand and supply of its products.

It helps the firm in exploring new markets for its products. Limitations of Marketing Research: It is not a Panacea: Marketing Research is not the ultimate solution to all marketing problems.

Rather it offers accurate information, which can arrive at suitable decisions to solve problem.

Pros and Cons of Outsourcing Research

Not an exact science: It deals with human behaviour and as such cannot be examined in a controlled environment.

There are various and uncontrollable factors which influence marketing forces. This gives scope for wrong conclusions.

  1. SurveyTrac provides everything you need to execute a successful research project from start to finish, quickly, affordably and worry free. During the period between starting the research and implementation of decisions, the situation and assumptions may have changed drastically which reduces the utility of research report.
  2. Understanding the advantages and disadvantages for using in-house staff to conduct marketing research allows company executives to select the most effective group for their current and future product research needs.
  3. Customization Internal employees tap product, development and support staff for in-depth product knowledge, questions and advice.
  4. Efficiency — no need to re-screen participants on key qualification criteria.

Hence this leads to marketing research as not being an exact science. Its process is lengthy and needs long time to complete it. During the period between starting the research and implementation of decisions, the situation and assumptions may have changed drastically which reduces the utility of research report. Decisions based on such report prove to be obsolete and result in false conclusions.

The complicated problems may not be comprehensively studied and their impact properly analysed by the researcher on account of insufficient fund, time and technique.

This leads to erroneous findings, which disappoint the management. Not an exact tool of forecasting: It cannot be used as a foolproof tool of forecasting because there are number of intervening factors between the findings of the research and marketing complex. The forces act and react and interact to give a complex state, which is difficult to be studied. In experienced research staff: It needs great expertise and well-trained and experienced researcher, interviewer and investigator.

Marketing research is a fact-finding exercise. It is not problem oriented.

  1. That factor alone typically far outweighs the cons to using a panel. Its use and effectiveness largely depends upon the ability of executives to get the most value of it.
  2. Marketing Research is not the ultimate solution to all marketing problems. Outsourcing marketing research can be a costly expense, but decreased client headcount and various efficiencies marketing research companies can take advantage of can effectively minimize costs while maximizing value.
  3. The complicated problems may not be comprehensively studied and their impact properly analysed by the researcher on account of insufficient fund, time and technique. It is not problem oriented.
  4. Time Another disadvantage of doing market research is the time associated with doing the research and performing questionnaires and interviews.
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It is of low and questionable validity. It is considered as a luxury for the management as it involves high cost. Limitations of tools and techniques: The validity of marketing research is also limited by the limitation of tools and techniques involved. Its use and effectiveness largely depends upon the ability of executives to get the most value of it.