Market research – Brewpub Your group is thinking about opening a restaurant with beer brewing (sometimes called a brewpub) somewhere in Canada. Using your access to E-Stat and the Cansim tables on the textbook website, as well as other sources you can find (for example, the Canadian Beer Index, http://realbeer.com/canada/  or Brewers Association of Canada), http://www.brewers.ca/  do some market research to determine the beer consumption in different provinces/territories, where the highest absolute consumption takes place, as well as the highest per capita consumption. Determine the number of brewpubs in the regions and use this information in your analysis. Select a location for your brewpub and justify it in a 550-word report. 5.2 Five-step approach to marketing research Once an organization identifies a problem or opportunity and decides to take action, there are five steps to follow: Step 1: Defining the problem Defining the problem, not the symptoms, is a key to successful research. A well-defined problem provides direction for the study and can uncover other relevant questions. Step 2: Analyzing the situation A situation analysis includes considering existing information from within the firm or from outside sources, such as suppliers and customers. Secondary data are data of which you are the second user. The data were initially collected for some other purpose and now you have access to them. These secondary data can be searched to reveal further facts pertinent to the situation. By gathering and analyzing situational information, you can determine what information is missing and what gaps are preventing satisfactory resolution of the problem. Step 3: Getting the problem-specific data Primary data means getting those data from the horse’s mouth, so to speak (that is, directly from consumers). These data can be in the form of qualitative interviews or quantitative question responses. Organizations can employ marketing firms or they can collect information directly. Observation and experimental techniques are also available. Problem-specific data may be of a primary or secondary nature. It is best to start with secondary data if possible, as it is already collected and available. For example, Statistics Canada has published information on household spending habits. If you were opening a restaurant, you could click on the Tables by Alphabetical list on the left hand side, then Average household food expenditure by province and territory (2010), and discover how much households spend on restaurants each year. This would allow you to calculate market potential and assess competitors. Primary data is information specific to the problem at hand. It often depends on custom-produced research instruments and can be expensive. When collecting data for projections, you should try to confirm estimates from more than one source. If you are able to obtain a second data source that indicates your estimates are reasonable (that is, not off by a factor of 10 or 100), this will reduce uncertainty. Market research is an ongoing process to reduce uncertainty. Researchers will sometimes collect qualitative data through a focus group to help further define the problem before embarking on a larger study to gather quantitative data. Quantitative data are easy to collect and useful when you want to identify widely held attitudes toward a topic. However, to have a deep understanding of why people hold certain attitudes, qualitative data may be more useful. Step 4: Interpreting the data Once the information has been collected, it must be interpreted. Data analysis can be done using specific statistical analysis packages, such as SPSS (Statistical Package for Social Sciences), or current spreadsheet software if it has enough analytical power to provide useful information. Such procedures can include cross tabulation, t-testing, and regression analysis. Step 5: Solving the problem Solving the problem by applying the knowledge derived from the analysis is the final step required to make marketing decisions. The solution should provide obvious links to the four Ps, so the marketing manager can easily apply the results in developing a marketing strategy. It is important to balance the value of research against the cost. There comes a point when research is too costly or time consuming to be of value. The marketing manager must be aware and manage resources accordingly. Exhibit 8-2 on page 210 of the text outlines the five-step approach to marketing research. This multimedia learning object uses the same model and includes a summary of each step.