Why marketing Research has evolved and grown?

There are several examples of the many different ways that companies use marketing research. But why is it even necessary for companies to use something called “marketing research”? The answer to this inquiry will help beginning marketing research proffessionals have a better understanding of why marketing research ha evolved and is continuing to grow.

Several characteristics of modern business encourage the use of marketing research by business. First, the suppliers of product and services need to have information about final consumers in order to market their products and services more effectively. Second, as a company grows and starts distributing its products in a number of different markets the managers of the company find themselves becoming more separated from the final consumers of their products.

Managers are separated from their final Consumers:

Many manufacturers distribute their products through their own sales personnel to wholesalers, who in turn sell those products to retailers, who then make the sale to the final consumers. In their normal course of business many manufacturers have little direct contact with the retailers of their products and no contact at all with the final consumers of their products. Thus, the marketing managers in such firms are separated from their final consumers by geographical distance as well as by a number of layers of people within their own organizations and within their wholesalers’ and retailers’ organizations.

Although retailers and service organizations have direct contact with their customers, managers of retail operations often have little knowledge of their customers’ attitudes, opinions and preferences because sales clerks and other store personnel do not relay customers’ comments to their managers. Furthermore, most customers who become dissatisfied with a retailer often just fade away and become former customers without the retailer ever knowing why. A retailer also has no contact with potential customers, that is with individuals who do not currently patronize the retailer’s store but who might become customers if the retailer could identify them and learn what would be effective in attracting them.

Managers need information from their final Consumers:

Manufacturers, retailers, suppliers of all kinds of services and many other organizations need certain kinds of information in order to be able to satisfy their customers’ wants and needs and to design effective marketing programs while still earning a profit. At least five such information topics are of great interest to marketing managers. These five topics and some of the questions marketing managers have regarding them, area as follows:

Target market: What is the best target market for the products or services being offered by the organization? How large is the target market and how can it be described? What are the attitudes, opinions preferences, lifestyles and so on of its members?

Products/services: Regarding particular and services how satisfied or dissatisfied is the target market with what is currently available? What product features and benefits do those consumers desire? How do they compare the organization’s product with those offered by competitors?

Price: How much value does the target market place on the product in question? What products are they willing to substitute for the product in question? What prices are charged for those substitutes? What advantages have that might allow it to charge a higher price?

Distribution: What distribution channel is the target market most likely to use when purchasing the product in question? Is the organizations pricing in line with what the target market expects to pay for the product when purchased through that channel? Does the pricing include the size of margin the channel traditionally expects to receive? Will the channel be able to provide the service or support needed or the product?

Promotion: What can the organization say in its advertisements about its product that will appeal to the target market and lead them to consider the organization’s product more attractive than those offered by competitors? Through what medium(s) (television, newspaper, billboards, etc) should the organizations advertise? What specific vehicles (i.e. what specific television programs or newspapers) should the organizations use to carry the advertisements? How often should the advertisements appear, and how much money should the organization spend on advertising? Should personal selling be used and, if so how? What kinds of promotions would have a favorable effect on the target market?