Original Research Special Problems

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Original Research Special problems

Industrial research often presents special problems not encountered in consumer work. With major items of capital equipment. for Stance, a single year's purchase figures can be quite misleading, owing to the relative infrequency of purchase or to the strongly cyclic nature of demand. A possible solution is to average demand over the last five years, or over whatever period appears suitable in the light of the product life cycle. This does, however, considerably increase the difficulty of field work - much more is demanded of informants and interviewers.

In certain circumstances, it may be more practicable to direct enquiries at the age and total stock of equipment, and to deduce current and future markets by the use of actuarial techniques. However, let us limit ourselves to the less difficult and perhaps more usual situations.

Complete coverage

In certain industrial markets our managing director is still in the right: in some cases the total number of customers and potential customers is so small that all can be interviewed at limited cost. However, difficulties now begin to arise: not all informants are prepared to co-operate. With so few informants, even one or two refusals could render any assessment of market size impossible.

Alternative approach areas

In some industrial markets, however, the number of customers and potential customers for the product under survey is often so high that any attempt to approach them all would be wildly uneconomic. In this situation the first instinct of the industrial market researcher is to move up the chain of industrial demand from end-users to distributors or from end-users to original equipment manufacturers. Alternatively, he might even move sideways, to competing manufacturers. In this way, of course, the numbers of informants, and hence the cost of the survey, can be drastically reduced.

Such an approach is not always possible, however, For instance, many industrial products are not sold through distributors. Even where they are, distributors are usually among the most difficult of informants. Not unnaturally, they regard the market information they have as a valuable asset in their business, and confidential to themselves. They are, again quite reasonably, unwilling either to undertake the clerical work which many market surveys involve, or to make their sales records available to a market research analyst.

Competitors deserve a special mention. They could, by cooperating, reduce the cost of a survey to the level contemplated by our managing director. Most research consultancies will approach competitors as a matter of routine, often with an offer of some exchange of information, and the approach can be surprisingly successful. It must, however, be made openly and the fact that the sponsor is a competitor must be made known (any other approach is unethical and will not be countenanced by any reputable consultancy). In any case, the information provided must never be accepted without cross-checks. Not all competitors will take the trouble to provide really accurate information, and cases of deliberate attempts to mislead are not unknown.

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