There are many limitations that I have to my market research. For instance, Mintel reports and Keynote reports would be very useful for me to seek information on my market, however they cost hundreds of pounds each and we cannot afford them. I therefore used the internet to get hold of brief summaries of my required market. I can also use special business libraries to get a look at the full versions of these reports. I have also used the website 'www.yell.com' to seek what competition I have in my local area is. I can then use competitor analysis to get ideas about how to run the business well.
I expect my results from my market research to be relatively accurate because I used both primary and secondary data. The questionnaire results should be accurate because it was a fair and random sample of people, however the results could easily be accidentally biased and that we do not know the views of everyone, just a sample. The Mintel and Keynote reports will be accurate because they are detailed reports of factual events using factual and accurate statistics of the general market.
Analysis & Evaluation of Market Research Findings Secondary Data he first piece of secondary research that I found was at the website www.yell.com. I used the search engine to find business' with the description "VIDEO & DVD - HIRE AND RETAIL" in the area of "HA5". A list of the seven companies, complete with address and telephone numbers that I must compete with within Harrow (Pinner) came up on screen. In conjunction with this, I used www.multimap.com to find a map of the Pinner area, and located these businesses on the map and then located where I am planning to locate my business. This makes it easy to see visually how close I am to competition, and I will also now know where to go to carry out competitor analysis. (See appendix 3).
The second piece of secondary data that I found was at www.mindbranch.com, and it is a market report on the "Video Retail & Hire". It is relatively recent (published in November 2000) and tells us that the market is growing, especially in the DVD sector. Between 1998 and 1999 the UK market for retail and hire fell by 5.7% to the value of ï¿½1.44billion. Due to the release of the digital versatile disc (DVD) in 1998, the market grew by 11.3%, which shows me that the market is growing.
I am also told that 'Titanic' and 'The Full Monty' are popular films. I have also found out that video retail is the largest sector of the market, with a share of around 61.5% in 1999. This piece of research also suggests to me that using the internet may be a good way to sell videos, advertise and promote the business. The main information which gives me confidence that my business should do well is the market is forecasted to increase by 94% within five years from 1999. (See appendix 4).
The second piece of secondary data that I have found is an executive summary of a keynote report from www.keynote.co.uk. This is more recent than the last - published in June 2002. This report also shows an increase in the market, of 60% to 69.6% between 1998 and 2001. A drawback is that film piracy might limit the success of firms in the future. I am told that competition in the market has increased, and that much competition will come from online retail. A positive sign though is that the market is forecasted to continue increasing until 2008, however by 2006, the growth is expected to slow down. The DVD market is expected to increase for many more years; however the VHS market is expected to slow more dramatically. This suggests to me that I should concentrate more on the DVD sector than on the video sector.
(See appendix 5 Primary Data - Questionnaire results I have chosen graphs rather than tables to show my data because it shows the data more clearly and one can see the necessary information at a quick glance, without having to do any working out or difficult comparison. The fact that my questions are multiple choice questions means that I have used pie charts and bar charts to show the data.
This pie chart shows the percentage of the people asked in each age group. It shows us that in the questionnaire, more than half the people that I asked were aged under 18. Aged between 25 and 40 is next highest, and then the other 3 age groups are similar in amount. This means that the. Results of the questionnaire might be biased towards the views of under 18s. I used a pie. Chart to show this information because it allows us to not only easily see the relationships between each of the age groups easily, but also it allows us to see how many people there are for each of the age groups in comparison to the overall number of people surveyed...
Primary Data - Competitor analysis Blockbuster entertainment Business: Sale and Rental of videos, DVDs and console games. Also basic refreshment for sale (drinks, popcorn and sweets). Film sale and rental shops tend to provide films of all genres and all of the new releases, with the exception of some outlets which only specialise in films from a certain country, ethnic group, or language. This means that market niches do not appear and everyone in the area will be happy to use the service. This also means that they maximise their revenues, however not always their profit margins.
My business will be no different in the sense that I hope to provide all of the new release films for my customers, and not concentrate on certain film genres. This is because all of the genres are popular; however different genres are more popular with different segments of the market. Before, there may have been a risk to this method when it comes to knowing how many copies of each film to purchase for rental; however a new method of distribution introduced in 2000 may benefit larger businesses in the market, and possibly businesses like mine in the near future.
The keynote report (see appendix 5) relays information that rather than paying the film studio for a certain number of copies of each film (meaning the business risks not being able to cover the costs of the purchase), the rental company shares the revenue on each film hiring with the film studio. This means that no matter how many copies of each film you purchase, you only pay a certain amount of the rental price each time the film is rented out. Therefore the business does not run the risk of not covering the purchasing costs. This service will obviously only be available to businesses that the film studios see as being successful enough.
Although my business will provide sale and rental of films of all genres to all people, there are main segments of my market that seem to stand out. The market seems to be mostly attracted to people aged under 18 and without children. Therefore to maximise the number of people entering the store, the store layout and appearance will be slightly more orientated towards their likes than the likes of the people in the other segments.
These people seem to rent out between 1 and 4 films per month and are mostly willing to pay 2.50 per night for each rental. This means that from one person in this market segment, I could get a payment of between 10 per month. These people seem to particularly like action, war, comedy, animated and spoof films. Video players, DVD players, and PCs seem to be quite popularly owned by these people.