Literature Review Of Marketing Research Procedure

Literature Review Of Marketing Research Procedure

The significance of decision making of market strategy and marketing depends on the conclusions derived from market research. The procedure of market research varies from company to company but it has a series of steps to be followed. The standard market research procedure helps in the avoidance of errors, miss understanding and risk of uncertainty.

Marketing Research Procedure can be defined as

“The scientific systematically procedure that includes the steps of problem definition, data collection, analysis and reporting of data and findings about certain issue if problem face by that organization” Kotler, et al (2007)

Literature Review:

Overview of Marketing Research Procedure:-

Marketing Research procedure involves step by step loom where each step is meant to answer scrupulous question. Kotler et al, (2007)

Why there is need to carry out the research?

What research needs to carry out?

How research objectives can be achieved?

How research will be concluded?

Stages of Marketing Research Procedure:

Stage 1 Research Purpose:-

The first step in the procedure of market research is to define research purpose. Research purpose is usually not very well defined or fully understood. The procedure of fully and accurately defining and understanding research purpose always requires efforts. Malhotra, (2005)

The research purpose is typically developed as result of recognizing and understanding problem. This problem is usually generated by realization of fissure between expected out come and the outcome in reality. Charles,(2005)

It is also important to define reason of problem that where that problem occurred. The problem definition is the point on which the whole arrangement is formed.

Research purpose usually includes few activities with shared understanding of research team and management.

Problem or Opportunity analysis:-

Decision Alternative Analysis:-

Research Decision makers

Step 2 Research Objectives:-

Research objective is accurate report about required in sequence. It understands problem statement more accurately and in more understandable way. Research objectives are designed in such a way that chore of finding required information fully provide the research purpose.

Research objectives have three essential parts.

Research Question

The research question describes information required by organization accountable for decision making. Research question represents the in sequence needs to obtained accordingly to research purpose. Kotler et al, (2007)


Hypothesis is researcher’s view of probable answer to a research question. The Researcher may produce possible outcome of research question in earlier stage and carry out research to answer that if hypothesis created at start of research was right or not. Kurtz et al, (2009)

Scope of Research

Hypothesis development aids keeping research procedure more accurate and well focused to serve research purpose. Another important issue of the research is indicating research boundaries or research limitations. Kotler, et al (2007)

Step 3:- Estimating the Value of Research information:-

After defining research purpose, objectives and scope it is also very significant to estimate value of information needed or the value of research problem that will possibly be replied in research question.

Step 4:- Research Design

Research design is in general structure or framework of research that is developed in order to conduct research.

Research design may includes following tasks (Malhotra, 2002)

Primary and Secondary Data analysis:-

There are two types of data analysis

Primary data is data that research needs to collect by himself more specific to research conducted. Primary data is usually collected through questionnaire surveys, interviews, and focus groups etc.

Secondary data is not first hand data as primary research it is the data that already is available like journals, books, articles, company records etc.

Qualitative and Quantitative Research :-

After selecting type of data required for research it is decided that what medium of data is required. Research can be through quantitative or qualitative or both depending on the wish of researcher.

Procedure of questionnaires designing, sampling and sampling size

Research questionnaire is designed in order to collect information from respondents in both ways quantitative and qualitative research.

Step 5:- Data Collection

After preparing questionnaire the next job is to practically get into filed and distribute questionnaires among group of respondents. It can also be done through

On line surveys,

Phone conversations,

Face to face interviews, and

By post.

In larger scale marketing research full dedicated field team or person may be required in order. (Baker & Hart,2003)

Step 6:- Data Analysis

After gathering of data it is then procedures to derived results in order to change them in conclusion, data analysis can be conducted with two methods manual or computer based data analysis. There can be different types of mathematical formulas can be used on data that is collected from questionnaires. It can also be checked for precision and soundness.

Step 7:- Reporting Results and Presentation

The Last and final part of research procedure is to write down in black and white whole project findings and write report that replies that specific research question that was identified at initiation of research. Research report also includes research loom adopted, design, collection and analysis of data together with all results of data. This report should be in the form to be prepared for decision makers to be used in decision maker procedure. (Charles, 2005)

TESCO apply

Marketing Research Process:-

TESCO as a company was established in 1932 by Jack Cohen in the United Kingdom (UK) which is the home market. In 1947 TESCO shares started to be sold on the public stock exchange. The key and first big acquisition was made in 1959 when TESCO took over more than 350 stores in the UK. In 1961 TESCO built up the largest store in Europe and entered the Guinness Book of Records. TESCO started opening several petrol stations in 1974 and in 1991 it became the biggest petrol retailer in the UK. The first entered market abroad was Hungary in 1995.

As a part of extending its business, TESCO also intended to enter china. China is considered to be a potential economy of future. Sighting this fact TESCO had market research conducted on china. To enter china, TESCO needed to have knowledge about its market. This could be done by research. The need of research was to understand what changes and adaptations TESCO had to make to enter china. The kind of research to be carried out included, political factors, economical factors, social and cultural factors, technological factors, legislation and ecological factors. Research objectives could be achieved by primary and secondary data collection while in addition to expert reports. Research could be concluded in terms of discussing market growth and development.

Stages of Marketing Research Process

Stage 1 Research Purpose:-

As a part of business expansion, TESCO had to conduct a market research. The purpose was to analyse if Chinese market would welcome TESCO and that TESCO be ever able to cover a big market share of Chinese retail business.

Problem or Opportunity analysis:-

Problems in analysis were the Chinese culture. TESCO being developed with its roots in British culture had the threat to face a total opposite culture. Chinese culture is high in context and very complex. It is hard to run a standardised business, high need of adaptability with diversification was needed

Decision Alternative Analysis:-

TESCO could have its expansion in other countries too, which had at least similar culture to its corporate one. But when it comes to prioritization there exist facing a challenging market too.

Research Decision makers:-

Research decision makers have to stay neutral in a term that at one hand Chinese culture is complex but on other hand they have to consider that china is a potential market too. Especially the way TESCO conducts its operations at economies of scale and has the advantage of cost leadership. Entering china also reflects an advantage of acquiring the low wage labour resources.

Step 2 Research Objectives:-

Research Question

Is it feasible for TESCO to enter china at a mass level?


Which way of entering china is more probable and beneficial? By organic or by acquisition?

Scope of Research

Retail business in china and adaptability of Chinese culture to new comers

Step 3:- Estimating the Value of Research information

Since china is a huge market, its information is relatively available. Many research tools could be applied as well including PESTLE, Porter’s 5 forces and Ansoff’s matrix.

TESCO as a company was established in 1932 by Jack Cohen in the United Kingdom (UK) which is the home market. In 1947 TESCO shares started to be sold on the public stock exchange. The key and first big acquisition was made in 1959 when TESCO took over more than 350 stores in the UK. In 1961 TESCO built up the largest store in Europe and entered the Guinness Book of Records. TESCO started opening several petrol stations in 1974 and in 1991 it became the biggest petrol retailer in the UK. The first entered market abroad was Hungary in 1995.

Step 4:- Research Design

Retailing market analysis

This section provides a picture of the conditions surrounding the Chinese market. A broad macro environment view of China is made through the use of PESTEL analysis. Chinese culture and business behaviour are hard to recognize for European companies and as an outcome they need to have an indication of the market in order to be successful.

Step 5:- Data Collection

The PESTEL analysis

The PESTEL analysis stands for political, economic, socio-cultural, technological, environmental and legal examination of forces that crash the business environment. It will be utilized to find the situations surrounding the market and as an gadget for understanding the market condition such as market growth/decline, industry position, market prospective and the direction of a company’s procedures. It is very important for a corporation to judge its environment before starting to carry out activities. As a first step on the way to enter and execute effectively on the Chinese market, knowledge about the macro environment will have to be created.


The political situation has a enormous power upon the directive of the financial system, and the spending power of buyers and companies. Through the last decades China has developed from being a totalitarian communistic government with centrally administered economical system to a more open market financial system with wider financial and social liberty for its citizens.

The government’s strategy on the financial system is constructive for the business life. First of all China has been made a market financial system and there is a well-built political will to make China an important player in the world financial system. The membership of World Trade Organization (WTO) in 2001 had huge outcomes, opening China’s financial system to the world, and making the country a very vigorous player in foreign trade.


The Chinese financial system has gone through an intense restructuring from being a state governed planned economy to a financial system more or less controlled by market forces. Parallel with the economical improvement process, China has experienced remarkably high growth rates on just about 9% a year. This has had an enormous effect on the Gross Domestic Product.

The membership of WTO has meant that China has agreed to attach and gradually lessen all tariffs. Even though the general levy level is decreasing, it is still high. On top of the levies both foreign and domestic businesses pay value-added taxes (VAT) and business taxes. China is now bound by WTO to offer indistinguishable tax behaviour for domestic and imported products. The general VAT rate is17 % but a variety of tax encouragements is offered.

China intends to segment out this two-tier revenue tax system for domestic and foreign ventures and move towards national handling that will mean a slow but sure elimination of special tax breaks for foreign shareholders.  The income tax rate for overseas companies will rise in stages ending in 5 years at the same altitude as for domestic companies, which is a tax rate of 25 %.60 to evaluate the main rate for company taxes in UK is 30 %.


Socio-cultural factors are a mixture of cultural aspects, such as customs and values, and social aspects, such as population growth rate and age distribution.

Socio-cultural values are exceptional in each country. Typically, Chinese socio-culture is hard to comprehend for foreigners. China is biggest population in the world with 1.3 billion people, which is about 22% of the world’s total. The population compactness is strongest in the coastal regions while the vicinity and western parts are more meagrely populated. From being a comparatively poor country, China is becoming one of the world largest extravagance goods markets. People are purchasing all well known brands instead of the fake brands.

Through the last two decades the political and economical changes has made a major influence on the society and as a result changed the Chinese standard of living. For much of the population, the life eminence and living standards have improved radically leading to an increase in utilization.


The aim of this part is to know more about the progression of technology in China. It seems to be the more applicable technological subject to treat with the retailing market. In fact, a recent expansion of retailing is made through internet and online shopping and it is interesting to know at what level China is in its technology maturity.

China had online access in 1994 and now it has become the second world largest online population after The United States.

Online payment, which is believed to be a factor obstructing e-shopping development, has been recovered and online payment are now believed by Chinese banks including the main ones like Bank of China and Merchants Bank. However people experience, still unsecured regarding to this topic. A survey conducted by Computer and Microelectronics Industry Development Research Centre and CCIDNET Consulting shows that only 20.3% of Internet users have on-line shopping experience, and only 40% of them are satisfied with on-line transactions. Furthermore, more than 80% of Chinese Internet users agonize about the security of on-line transactions.


The short-term priority of China for many years has been the financial growth. In June 2007 the Organisation for Economic Co-operation and Development (OECD) warned China about the contamination of the country. In fact China has become the third monetary leader in the world but also the most polluted country in the world. China’s stunning economic growth of the last 3 decades has come at a heavy price to its environment.

China’s difficulty is that economic issues are of utmost significance are relative to environmental issues. There are environmental laws, but the level of local submission of them is missing, due to local governments being judged only regarding to their economic presentations.

However, recently China has begun to worry about the environment. In fact China’s environmental law specifies that businesses must design, build, and utilize pollution control facilities. Government has also started using the “green credit policy” in collaboration with the Central Bank, to cut loans to the companies, which are not abiding environmental rules. Moreover the governmental authorities have planned to increase financial penalties for rule breakers and force firms to pay more towards the cost of emissions. By June 2007, the environmental behaviour of 220,000 firms has been examined and more than 8,000companies and 170 people punished for unlawful practices.

In China, the environment is a very responsive topic. However, under international pressure from governmental and non-governmental organisations, environmental preoccupations in China began to prevail.

A company entering China must be very cautious to its environmental policy, because one of China’s aims is actually to fight pollution emission of companies, and the controls relative to environmental practices of companies become more and more regular.


In China, foreign firms investing must be conscious of China’s general lack of codified laws and the regional variety of “legal systems” and practices.

To protect buyers there are government agencies involved in food and product safety, including work on new laws and regulations. The SAIC (State Administration of Industry and Commerce) for instance, regulates and keeps a check on “market circulation” which means the entire process of food from the producer to the consumer. This includes transportation, distribution channels and retail. Piracy of intellectual property is very common in China and it has been an important source of argument between China and foreign investors. However, its defence has been one of the priority of the Chinese government since it devotion to the WTO in 2001.

Environment of the retail industry

In general the competition is violent in the retail industry. This is underlined by both threat of new entrants, threat of alternatives concepts and not least the strength of rivalry in the industry. A lot of strong rivalries are present at the market and they happen to have advantages compared to TESCO. Foreign competitors have more practice at the market and local competitors have more local knowledge. Moreover Chinese consumers seem to have other priorities than the European consumers that TESCO normally is dealing with. They come from a market where conventional market places and roadside markets has been the normal place for shopping but they more and more prefer supermarkets. The consumers bargaining power is high but their priorities are split. They are price sensitive but they also value ease and quality gigantic potential and the fact that it is still not saturated. A newcomer still has the option to surmount a big market share and even gain market leadership.

Step 6:- Data Analysis

On the basis of the retail market analysis it can be concluded that the supermarket development in China is highly inter related with political and economical expansion in the country. The government is making China more open to foreign entering companies and wants to stretch modern food retailing transversely the country. Lately, this has ended up with retail companies getting more or less free entrance to the Chinese markets.

The general expansion in the society is also providing the retail industry with incessantly better conditions. Growing urbanization means more probable customers for supermarkets. People are increasingly employed in the private segment and earn more money. This results in poor people moving to the middle class, and cause an increased buying power among consumers. It can also be concluded that the Chinese civilization is severely different from the Western culture.

It should be pointed out that expediency and quality is guaranteed in TESCO stores however this will not really differentiate TESCO as other companies are doing the same. Nevertheless these are critical points of equivalence and activities performed in creating this service and quality can distinguish the company.

Step 7:- Reporting Results and Presentation

Concluding the analysis of TESCO’s development and market research in China above, TESCO’s focus should be on long-term strategic decisions rather than rapid expansion at all costs. Further stress should be given to the expansion into key regions and adapting to local customer needs. The greatest hazard to TESCO’s growth could be TESCO itself either through arrogance or over ambition. (Foster, 2004)


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