Market Research Fundamentals Flashcards

Question 1

What is market research and why do businesses conduct it?

Accepted Answer

Market research is the systematic gathering, recording, and analysis of information about customers, competitors, and market conditions. Businesses conduct it to reduce uncertainty before making decisions such as launching a product, setting a price, or entering a new region. Good research replaces guesses with evidence, though it cannot guarantee success.

Question 2

What is the difference between primary and secondary data?

Accepted Answer

Primary data is collected directly by the researcher for the specific study at hand, such as through interviews, surveys, or observation. Secondary data already exists because someone else collected it for another purpose, such as government statistics, trade association reports, or previously published studies. Secondary sources are often cheaper and faster to obtain.

Question 3

Why does a clear research objective matter before any data is collected?

Accepted Answer

A clear research objective states exactly what decision the study must inform and what information is needed to make it. Without one, teams gather large amounts of data that answer no useful question. Writing the objective first also guides every later choice, including the method, the sample, and the questions asked of participants.

Question 4

What is the difference between qualitative and quantitative research?

Accepted Answer

Quantitative research measures things in numbers, answering questions about how many, how much, or how often, with large samples and structured questions. Qualitative research explores meaning, motivations, and experiences through open-ended methods such as interviews and focus groups, usually with smaller samples. Many projects combine both, using qualitative work to explain patterns that quantitative work reveals.

Question 5

What does the term target market describe in market research?

Accepted Answer

The target market is the specific group of customers a business intends to serve with a product or service. Research helps define it by describing who these customers are, what they need, and where they can be reached. A well-defined target market keeps messaging, pricing, and product features focused on the people likely to buy.

Question 6

What is the purpose of a competitive analysis in market research?

Accepted Answer

Competitive analysis examines the rival businesses that serve the same customers, looking at their products, prices, positioning, strengths, and weaknesses. Its purpose is to show where a business can differentiate itself and where it faces the greatest pressure. Researchers gather this from public sources such as websites, advertising, and sales listings, along with customer feedback.

Question 7

What is a hypothesis, and why state one before collecting data?

Accepted Answer

A hypothesis is a testable statement about what the researcher expects to find, such as price sensitivity differing by region. Stating it before collecting data keeps the study focused and reduces the risk of reading meaning into noise. It also defines what evidence would count against a business idea.

Question 8

What is a research brief and what should it include?

Accepted Answer

A research brief is a short document that sets out the business problem, research objectives, target audience, key questions, budget, and timeline for a study. It gives stakeholders and researchers a shared understanding before work begins. Clear briefs prevent scope creep and make it easier to judge whether the final findings answered the original need.

Question 9

What is an exploratory research design and when is it used?

Accepted Answer

Exploratory research is used when the problem is poorly understood and the researcher needs ideas, context, or hypotheses rather than firm answers. It is flexible and often relies on interviews, focus groups, or review of existing materials. Its findings usually guide the design of later, more structured studies.

Question 10

What is descriptive research, and what kind of question does it answer?

Accepted Answer

Descriptive research documents the characteristics of a population, market, or phenomenon, such as who buys a product, how often they buy it, and what they spend. It answers questions of who, what, when, where, and how much, but it does not establish why something happens. Surveys and syndicated tracking studies are common examples.

Question 11

What is causal research and why is it harder to design than descriptive research?

Accepted Answer

Causal research tests whether one variable actually produces a change in another, such as whether a new packaging design increases sales. It is harder to design because the researcher must control for other explanations, often through experiments with comparison groups. Descriptive studies can show association but cannot prove that one thing causes another.

Question 12

What is the difference between a closed-ended and an open-ended question?

Accepted Answer

A closed-ended question offers fixed response options, such as yes or no, a rating scale, or a multiple-choice list, which makes answers easy to count and compare. An open-ended question lets respondents answer in their own words, which yields richer detail but takes more effort to analyze. Good questionnaires usually balance the two.

Question 13

What is a leading question, and why should researchers avoid it?

Accepted Answer

A leading question signals the answer the researcher wants, for example asking how much customers love a new feature rather than how they feel about it. Leading wording biases responses toward that answer, so the data overstates approval and misleads decisions. Neutral phrasing lets respondents report their real views, even when those views are unwelcome.

Question 14

What is a double-barreled question and how can it be fixed?

Accepted Answer

A double-barreled question asks about two separate things at once, such as how satisfied someone is with the price and quality of a product. A respondent who feels differently about each part cannot answer accurately. The fix is to split it into two separate questions, one about price and one about quality.

Question 15

What is a Likert scale and what does it typically measure?

Accepted Answer

A Likert scale is a set of ordered response options, usually running from strongly disagree to strongly agree, that measures the strength of a respondent's attitude. Researchers typically present several related statements and combine the scores to gauge overall sentiment. Its intervals are not guaranteed to be equal, so analysts treat the results with care.

Question 16

Why is a pilot test of a questionnaire worth running before fieldwork?

Accepted Answer

A pilot test runs the questionnaire on a small group similar to the real audience to reveal confusing wording, skipped questions, and survey length problems. It also shows whether the response options cover every realistic answer. Fixing these issues early is far cheaper than discovering them after the full sample has already responded.

Question 17

What is a focus group and what is its main limitation?

Accepted Answer

A focus group brings together a moderated discussion of six to ten participants who share a relevant trait, letting the researcher observe reactions to ideas. Its main limitation is that results cannot be generalized to a larger population, and a dominant speaker can shape the group's views. Findings are best used to generate ideas and hypotheses.

Question 18

What is a structured survey and how is it administered?

Accepted Answer

A structured survey uses a fixed set of questions asked in the same order to every respondent, so answers can be compared directly. It may be administered online, by telephone, by mail, or in person. Its strength is scale and comparability, while its weakness is that it can only capture what the questions anticipated.

Question 19

What is an in-depth interview and when should a researcher choose one?

Accepted Answer

An in-depth interview is a one-on-one conversation guided by a flexible discussion guide, allowing the researcher to probe motives and experiences in detail. It suits sensitive topics, complex decisions, and business audiences such as buyers in organizations. Because each interview is time-consuming, samples are usually small, and findings describe depth rather than prevalence.

Question 20

What is observational research and what can it reveal that surveys cannot?

Accepted Answer

Observational research records behavior as it happens, through methods such as shop floor tracking, store audits, or watching how customers use a product. It can reveal actions people do not report accurately, such as skipped steps or unnoticed packaging. Observation shows what people do, but it rarely explains why they do it.

Question 21

What is a diary study and what makes it useful in market research?

Accepted Answer

A diary study asks participants to record their behavior, purchases, or experiences over a set period, using apps, photos, or written entries. It is useful because it captures activity as it unfolds in everyday settings, reducing errors from later recall. It is more demanding for participants, so incentives and clear instructions matter.

Question 22

What is secondary data mining and what is a common risk with it?

Accepted Answer

Secondary data mining means searching existing datasets, such as sales records or public census tables, for patterns relevant to a business question. A common risk is that the data was collected for another purpose, so its definitions, coverage, or timing may not match the study. Check the source before relying on it.

Question 23

What is mystery shopping and what does it typically measure for a business?

Accepted Answer

Mystery shopping uses trained evaluators who pose as customers to experience a service or purchase process and report on what happened. It typically measures staff behavior, adherence to procedures, product availability, and the overall customer experience. Because evaluators follow a scripted checklist, results can be compared across locations.

Question 24

What is the difference between a panel and a one-time sample?

Accepted Answer

A panel is a group of the same people recruited to respond repeatedly over time, which makes it possible to track change within individuals. A one-time sample is drawn once and answers a single round of questions, offering a snapshot without any follow-up. Panels are valuable for tracking behavior, but panel members may become conditioned and less representative over time.

Question 25

What is a population in market research, and how does it differ from a sample?

Accepted Answer

The population is the full group the research aims to understand, such as all adults who buy coffee in a city. A sample is the subset of that population actually included in the study. Researchers draw conclusions about the population from the sample, which is why the way the sample is selected matters so much.

Question 26

What is a sampling frame and why can its quality affect results?

Accepted Answer

A sampling frame is the list or source from which the sample is drawn, such as a customer database, a phone directory, or an address file. If the frame leaves out part of the population, some people have no chance of selection, which biases results. Researchers check the frame for gaps and duplicates beforehand.

Question 27

What is random sampling, and what advantage does it provide?

Accepted Answer

Random sampling gives every member of the population a known, nonzero chance of selection, often using random numbers. Its main advantage is that differences between the sample and population arise by chance, which allows researchers to estimate sampling error. It does not, however, guarantee that a sample is representative if the frame itself is flawed.

Question 28

What is convenience sampling and why is it risky for conclusions?

Accepted Answer

Convenience sampling recruits whoever is easiest to reach, such as shoppers at one store entrance or visitors to a company's social media page. It is fast and inexpensive, but the people reached may differ from the wider market. Results from convenience samples can suggest ideas but should not be presented as representative of the population.

Question 29

What is quota sampling and how does it differ from random sampling?

Accepted Answer

Quota sampling sets targets for subgroups, such as a set number of women and men in each age band, and fills each quota with whoever is available. Unlike random sampling, it gives no known chance of selection. It is popular for speed and cost but prone to selection bias.

Question 30

What is sample size, and why is a larger sample not always better?

Accepted Answer

Sample size is the number of people or units included in a study. Larger samples reduce sampling error, but they do not fix bias, so a large biased sample can be less useful than a smaller, well-selected one. Budget, the precision needed, and the number of subgroups to be compared all shape the right size.

Question 31

What is response bias and what are two common forms?

Accepted Answer

Response bias occurs when the answers people give differ from the truth, pulling results in a consistent direction. Two common forms are social desirability bias, where respondents answer in ways that look good, and acquiescence bias, where they tend to agree with statements regardless of content. Careful wording and neutral question order help reduce both.

Question 32

What is nonresponse bias, and why does a low response rate matter?

Accepted Answer

Nonresponse bias arises when people who do not answer differ meaningfully from those who do, so the findings reflect only the respondents. A low response rate raises the risk of this bias, though a high rate does not guarantee accuracy. Researchers compare respondents with known population characteristics to check whether the sample still looks representative.

Question 33

What is a survey weighting adjustment and why is it used?

Accepted Answer

Weighting adjusts the influence of each respondent so the sample better matches known population proportions, such as age, region, or income. It is used when some groups are over- or underrepresented despite careful sampling. Weights should be documented, since heavy weighting can increase variability in the estimates.

Question 34

What is a cross-tabulation and what question does it help answer?

Accepted Answer

A cross-tabulation displays the counts or percentages of responses for one variable broken down by another, such as purchase intent by age group. It helps answer whether answers differ between segments, which is a common need in market research. Cross-tabs are simple to read, but researchers must check whether differences are large enough to matter.

Question 35

What is statistical significance and what does it not tell a researcher?

Accepted Answer

Statistical significance indicates that an observed difference is unlikely to be due to chance alone, given the sample size and variability. It does not tell you whether the difference is large enough to matter commercially, nor does it prove the cause of the difference. Practical importance must be judged separately, since tiny gaps can be significant in large samples.

Question 36

What is a confidence interval and how should it be read?

Accepted Answer

A confidence interval is a range of values likely to contain the true population figure, computed from the sample at a stated confidence level. A result of 45 percent with a margin of plus or minus 3 points suggests the true value is probably between 42 and 48 percent. Wider intervals signal less precision.

Question 37

How should a researcher present findings to a business audience?

Accepted Answer

Lead with the business question and the direct answer, then support it with the most relevant evidence rather than every table. Use clear visuals, state limitations plainly, and separate what the data shows from what the team recommends. Decision makers act on conclusions they can trust, so clarity matters more than volume.

Question 38

What is a SWOT analysis and how does market research feed it?

Accepted Answer

SWOT stands for strengths, weaknesses, opportunities, and threats, a framework for organizing internal and external factors. Market research supplies the external evidence for opportunities and threats, such as trends and rival moves, and the internal evidence for strengths and weaknesses. A SWOT is only as useful as the evidence behind each entry.

Question 39

How can market research help set a price for a new product?

Accepted Answer

Researchers can test how customers respond to different price points, using methods such as Van Westendorp price sensitivity questions or conjoint analysis. They also study competitor prices, perceived value, and the costs the business must cover. The goal is to find a price that customers accept and that still supports a viable margin.

Question 40

How do researchers decide whether a market opportunity is worth pursuing?

Accepted Answer

They weigh the estimated size of the market, the strength of demand evidence, the intensity of competition, and whether the business can reach and serve the customers. Findings are compared against the original objective and the cost of acting on them. A clear recommendation states the decision, the evidence behind it, and the risks that remain.

Market Research Fundamentals Flashcards

1Foundations of Market Research

2Research Design and Question Types

3Data Collection Methods

4Sampling and Survey Quality

5Analysis and Applying Findings

Learning Resources