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Read the information supplied and answer the questions which follow - Leaving Cert Business - Question A - 2013
Question A
Read the information supplied and answer the questions which follow. An Irish company, 'All-Weather Wellies Ltd' identified a niche market for colourful wellington ... show full transcript
Worked Solution & Example Answer:Read the information supplied and answer the questions which follow - Leaving Cert Business - Question A - 2013
Step 1
Outline the market research techniques available to 'All-Weather Wellies Ltd' for developing its product range.
Answer
To develop its product range, 'All-Weather Wellies Ltd' can utilize the following market research techniques:
Desk Research
- Definition: Desk research involves gathering existing information that has already been collected.
- Sources: It can be conducted both internally (existing company data) and externally (publicly available resources).
- Cost-Effective: This method is relatively inexpensive, allowing the company to save on costs while gathering insights.
- Types:
- Internet Resources: Accessing market reports and consumer data online.
- Publications: Using industry-specific publications and newspaper articles to understand trends.
- Consumer Spends: Analyzing daily sales reports to identify customer purchasing patterns.
- Census Data: Utilizing information from the Central Statistics Office to understand demographic trends.
Field Research
- Definition: Field research involves collecting first-hand data directly from consumers and potential customers.
- Methodology: This is conducted via direct engagement, which might include surveys or interviews.
- Observational Studies: Monitoring consumers as they interact with products, allowing for insights into purchasing behaviors.
- Customer Feedback: Gathering specific feedback from customers can help tailor products to better meet their needs.
Step 2
Explain the term 'market segmentation' with reference to 'All-Weather Wellies Ltd'.
Answer
Market segmentation refers to the process of dividing a broad consumer or business market into sub-groups of consumers based on shared characteristics.
Application to 'All-Weather Wellies Ltd'
- Identifiable Sections: This allows 'All-Weather Wellies Ltd' to categorize its potential customers into identifiable segments based on demographics, such as age, gender, or lifestyle preferences.
- Target Market Example: For instance, 'All-Weather Wellies Ltd' might segment the market into categories like festival-goers, families, or outdoor enthusiasts, each with distinct buying preferences and needs.
Step 3
Discuss the reasons why the 'All-Weather Wellies Ltd' marketing department might engage in market segmentation.
Answer
Engaging in market segmentation offers several advantages to the marketing department of 'All-Weather Wellies Ltd':
Customer Focus
- Targeted Strategies: It allows the company to make strategic decisions focused on the segments that are more likely to purchase colourful wellington boots.
- Optimizing Resources: Efficient allocation of resources to target segments that will yield the best return on investment.
Competitive Advantage
- Differentiation: By identifying and appealing to specific segments, 'All-Weather Wellies Ltd' can differentiate its products from competitors.
- Marketing Effectiveness: Tailored marketing messages that resonate with the specific needs and preferences of each segment can enhance promotional effectiveness.
Customer Relationships
- Building Loyalty: Understanding various segments can help in creating personalized relationships, increasing customer loyalty and long-term profits.
- Feedback Utilization: Engaging with specific segments enables the company to gather targeted feedback, enhancing product offerings based on customer insights.