Marketing Research: Scope,

Advantage and Limitations

|Marketing Management

Marketing Research: Scope, Advantage and Limitations!

Scope of marketing research means the possible applications of
marketing research in corporate environment. Bulk of research is
done to measure consumer needs and wants. Besides, marketing
research is carried out to assess the impact of past marketing
actions. Some research is done to understand the competitive,
technological, social, economic, cultural, political or legal
environments of the market.

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Another way of looking at the scope of marketing research is the

look at the particular decision area, where research results are used.

They may be outlined as follows:

Sales Analysis:
Much research is done in these areas which are broadly referred to
as sales analysis— measurement of market potential/demand
projection, determination of market characteristics, market share
estimation, studies of business trends, etc.

Sales Methods and Policies:

Marketing research studies are also conducted with a view to
evaluating the effectiveness of present distribution system. Such
studies are used in establishing or revising sales territories. They are
also helpful in establishment of sales quotas, design of territory
boundary, compensation to sales force, physical distribution, cost
analysis, etc. It is also done to assess the effectiveness of different
promotional activities, such as premiums, deals, coupons, samples,
etc.

Product Management:
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Market research is also conducted in order to better manage the

existing and new products—to assess consumer feedback, to assess
consumer reaction before launching a new product, etc. Sometimes
pricing studies, packaging research, and design or physical
characteristics studies have also been conducted.

Advertising Research:
These include media research, and advertising copy research.

Corporate Research:
Corporate research studies about the social value research, political
studies {e.g., research to ascertain the public opinion about the
election results), and consumer service studies (e.g., many banks
and large industrial houses have conducted market research to
know the consumer’s changing needs, for service and possible
grievances about existing operations).

Syndicated Research:
Several research agencies collect and tabulate marketing
information on a continuing basis. Reports are sent periodically
(i.e., weekly, monthly or quarterly) to clients who pay subscription
for them.

Advantages of Marketing Research:

Importance:
The following advantages offered by marketing research
show its importance:
1. Facilitates planned production:
By forecasts of probable sales in the coming years.

2. Discovery of causes of consumer’s resistance:

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It helps in identifying the reasons for consumer resistance to

existing or new products.

3. Correction of defects:
It reveals defects and therefore makes corrective action possible.

4. Reveals the nature of demand:

It brings out whether the product is in constant demand throughout
the year or has a seasonal demand.

5. Effectiveness of existing channels of distribution:

For example, in the case of TVs it may be discovered that after sale
service is not satisfactory. Then, arrangements may be made to
remove such grievances of the customers.

6. Product utility:
It indicates why exactly the product is being purchased by the
people and what exact service do they get out of it. For example, a
market research conducted by Hindustan Lever Ltd., revealed that
their ‘Sunlight Soap’ which was originally intended to serve as a
washing soap, was being used as toilet soap by many people.
7. New uses of the product:
Marketing research may reveal certain new uses for the existing
products.

8. Market information:
It provides complete information about the market and the changes
that are likely to occur in demand for a certain product.

9. Discovery of potential market:

It provides information about the possibility of potential (future)
market.

10. Discovery of new lines of production:

It helps in the discovery of supplementary lines of products.

Limitations of Marketing Research:

It is important to note here the following limitations of
market research:
(i) A research study will fail to serve its purpose if marketing
researcher merely collects some statistical facts; or is preoccupied
with techniques or; uses data of questionable validity; or
communicates the findings in too much vague or technical
language.

(ii) A research study will suffer if the marketing manager does not
offer full perspective of the research problem; or allows inadequate
time; or uses research as a ‘fire-fighting’ device; or does not really
appreciate the value of research.

(iii) Marketing research cannot by itself provide the solution or

make the decision. It only reveals relevant information to the
marketing managers who can be able then to make sound and
strategic marketing decisions.