Guidelines for Performing Research

Guidelines for performing research:

All sections are set up to allow for the fill-in of information. Anywhere the text is italic, would be where you would put in the information pertaining to the individual assignment (and un-italicize).

Example:

The title of one section reads:

Market Demographics of City, State [or other defined parameter (state, national)

An example of how it would appear in an actual report:

Market Demographics of Orlando, Florida

Market Demographics of South Florida

Market Demographics of South-East United States

Models: Certain sections will different forms of the template depending on the type of business being analyzed. They will be indicated by a tag, example: [Geographic Model]When choosing which model to use, delete out the other models and the tags before finalizing the document.

To access any of the library’s research sources, make sure you have access to the online databases. Most of the sources used will come from the Business Research Guide, found here:

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Market Research Package

Market Demographics

You can gain this information from a number of resources and/or statistical websites. Provide the information in tables if appropriate, using the Insert Table function in Word, for example.

Contingencies:

If working on a local business where the market is confined to a geographic area (i.e. all people in Orlando, FL), use the Geographic Model. The items can be found with the following resources:

If working on a business whose market is not confined to a geographic area (i.e. anybody who is interested in motorcycles), use the Characteristic Model. Use marketing research resources to find numerical data/tables on the population of people with the characteristic. If the market is defined by two or more characteristics (i.e. anybody who is interested in motorcycles and social networking), find the population numbers of each group and list one after the other. Resources that can be used to find this information include:

Target Market Analysis

You can gain this information from a number of statistical websites and resources. Provide the information in tables if appropriate, using the Insert Table function in Word, for example.

Size of the target market within region:

Contingencies:

If working on a local business where the market is a certain demographic confined to a geographic area (i.e. all teenagers in Orlando, FL), use the Geographic Model. You will use demographic information to identify the location, and then narrow down by the criteria. Sources for this would include:

If working on a business whose market is not confined to a geographic area (i.e. anybody who is interested in motorcycles), use the Characteristic Model. Use marketing research resources to find numerical data/tables on the sales or penetration of that characteristic. Because the population size has been already covered at this point, this section serves to delineate the size of those people who actively participate and spend money towards the characteristic.If the market is defined by two or more characteristics (i.e. anybody who is interested in motorcycles and social networking), find the population numbers of each group and list one after the other. Resources that can be used to find this information include:

Income and Expenditures of the Target Market

This section will show the income and expenses of the typical consumer (food, housing, apparel, healthcare, etc.) It should look like a pseudo-income statement.

Contingencies:

If working on a local business where the market is a certain demographic confined to a geographic area (i.e. all teenagers in Orlando, FL), use the Geographic Model. You will use demographic information to identify the criteria (age, genders, ect.), and then state the income and expenditures. Sources for this would include:

If working on a business whose market is not confined to a geographic area (i.e. anybody who is interested in motorcycles), use the Characteristic Model. Marketing research information may be the best source for income information. Finding a report on this characteristic will often include a table displaying the numbers of people with this characteristic by household income. Alternatively, the information may come from an industry analysis. This may come from an IBISWorld industry profile Major Market Segmentation section.

Sources for this can include:

For the expenditures under the Characteristic Model, sourcing this information may be more difficult. One option is to gather all of the demographic information on the typical consumer with the characteristic, and then obtain consumer expenditure information for each of those demographics. Then, a weighted average can be computed using the number of people in each of those demographic parameters. This method is time consuming, however. Weighted average of two groups, A & B, is computed as follows:

(Amount spent by group A on one category X Number of people in group A) + (Amount spent by group B on same category X Number of people in group B) / Number of people in group A + Number of people in group B

(For more than two groups, treat each part of the equation the same. So, instead of A+B, you can have A+B+C+D.)

This will need to be done for each category of expenses (food, clothing, healthcare, etc.) to formulate one final table. Sources for this information can include:

Preferences and Social and Economic Trends of the target market:

In this section, you will provide tables that report relevant consumer surveys. Look for topics regarding what defines this target market. If this includes a demographic characteristic, such as age (i.e. teens), find reports or surveys that relate to the age group. If this includes a type of product or an industry, find reports or surveys regarding that type of product or industry, and so forth.

The best source for this information is Mintel Current, but other sources under the Marketing & Consumer Behavior tab in the Business Research Guide should be looked at as well.

As in previous sections, provide the information in tables if appropriate, using the Insert Table function in Word, for example.

Source information:

Product Mix

This information is found primarily in the IBIS World page for the client’s industry. The graph is found in the Products and Markets section of the industry profile, under Products and Services. Any additional information needing to be added should be sought in other resources found in this guide.

Bargaining Power of Buyers

A number of sources can be used for this Porter force, both through the library and the general Internet. You will want to know the industry the business falls into to be able to accurately perform a Five Forces Analysis.

Review the graph in the report to assign the numbers into the table in the template. Read the written analysis in the report that follows the graph. Under the table in the template, use the scores and the written analysis to create an analysis and a commentary.

The analysis should contain the level of the force (strong, high, moderate, medium, low, weak, etc.), which should be determined by both the written analysis in the Datamonitor report, as well as the researcher’s own judgment and experience. In addition to a statement of the level, should be a brief explanation as to why that is the level—it can reiterate the definitions in the table to suit the industry at hand for a few particularly relevant/influential parameters.

The commentary should include any especially interesting or pertinent information that may further explain the analysis. This is where the information in the written analysis in the Datamonitor report can be further divulged. Avoid repeating the entire section and do NOT copy and paste. The Datamonitor analysis will almost always be longer and wordier than what is necessary for our research package. Summarize, simplify, etc. but only if it truly adds valuable meaning to the Porter force analysis.

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Competitor Research Package

Industry Standards

This information is found primarily in the IBIS World page for the client’s industry. The graph is found in the Competitive Landscape section of the industry profile, under Basis of Competition. Any additional information needing to be added should be sought in other resources found in this guide.

Competition Analysis

Identifying Competitors-Sampling Frame

Use the information from the client questionnaire regarding competition to identify the competitors the client is facing. There are a number of outcomes that can be arrived at when analyzing this portion of the questionnaire. The client can be in competition only with national brands/companies. They can be in competition with only locally owned and operated companies. They can be in competition with Internet businesses. The client may also be in competition with any combination—the above example is not an exhausted list. The researcher must use his or her judgment along with a consultation with the client to determine the scope of the pool of competitors the researcher will include in this package.

Additionally, the size of this scope will also determine the types of research sources information can be found in. Many national brands will operate locally (example would be a national restaurant chain such as Denny’s or Olive Garden)—perhaps the client will be in competition with that company’s local locations (in our example, if the client was opening their own breakfast diner or Italian restaurant). Even though the client is owned and operated locally, national competition must be considered, perhaps in addition to local competition (a nearby “mom and pop” diner or Italian restaurant). However, if the client is only concerned with local competition (example would be a dry cleaners or a nail salon), researching national brands may prove difficult and irrelevant.

Competitor Profiles

Choose which model to use based on the type of competitors identified:

National Competitor Model: Used when the competitor is a medium to large sized company that has locations throughout the country/region/state (essentially, a large enough reach not to be considered locally owned and operated). Use if both the client and the competitor are focused nationally.

National-Local Competitor Model:This is used with the same type of competitors as the National Competitor Model, but in this model, the client is focused locally. The competitor must have at least one location within the geographic area of the client/client’s target market.

Locally Owned & Operated Competitor Model: This is used when the competitor is not a national brand, even if they have local branches or locations in the same vicinity as the client. This type of model is used for typically independently-owned companies. There may be multiple locations, but they would be generally confined to the region the client is in and competes in.

National-Internet Model: This is used when the client is either Internet-based or has an Internet sales component to the business. The competition would also include those companies that sell on the Internet or have an Internet presence and thus can reach a national market.

Sources for this information:

When evaluating locally owned and operated competitors, it may be more useful to utilize resources that focus on the local metro area.

Competitive Rivalry within the Industry Industry

Threats from Substitute Industries

Identifying Substitutes—Sampling Frame

Use the information from the client questionnaire regarding external competition and substitutes to identify the substitute industries the client (and their industry) is facing. It is vital to know that a substitute is NOT the same thing as a direct competitor. For example, Pepsi Cola is not a substitute for Coca Cola, nor is it even a substitute for Sprite. All three brands are soft drinks, and all three are within the Carbonated Soft Drink Production in the US industry (NACIS 31211, or the Soft Drink and Ice Manufacturing Industry). A substitute is an alternative to the type of product or service a business provides, not an alternative to the specific brand. A substitute would be from outside the industry—with the soft drink example, substitutes would bemilk, coffee, tea, beer, wine, etc. Instead of drinking a soda, a person could drink iced tea or a beer with their dinner.

To determine if there are substitutes to the client and its industry’s products and/or services, the researcher must have a general understanding of the industry the client is operating in. Using the following resources, the researcher should evaluate and identify if there are substitutes, and then form industry profiles for these substitutes.

The following sources can be used to identify substitutes:

Industry Profiles

In the IBISWorld industry profile (see above), the Similar Industries section can provide a good starting place to identify possible substitutes. Additional Internet research may be necessary, such as searching the NAICS website at

Once the substitute industries are identified, the profiles can be created primarily from IBISWorld industry information. If additional information is needed, the researcher can locate the same industry’s Datamonitor report in MarketLine, and add any missing or additional information. These sources are found:

Threat of Substitutes

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Industry Analysis Package

Industry Profile

It may be difficult to find an industry if the company you’re working on does not fall into one distinct industry. You may have to find the closest possible industry, or do more than one industry profile if the company falls into more than one industry. You may need to search on MarketLine or Hoovers to get a better idea of which industry to go with.

Each section of the industry profile generally follows the same set up as the IBISWorld profile. However, not every industry can fit into the template properly. Judgment must be used when deciding where to put bullet points, sub-points, etc. Look at previous examples for ideas, but try to keep the format somewhat consistent.

This section will take up a great deal of time. Time management is a must.

Bargaining Power of Suppliers

and

Barriers to Entry/Threat of New Entrants

A number of sources can be used for these Porter forces, both through the library and the general Internet. You will want to know the industry the business falls into to be able to accurately perform a Five Forces Analysis.

Sources of information:

Business Environment Research Package

Local Environment

BizMiner

This source must be accessed using one of the “seats” (log-ins) that the University of Central Florida has purchased. The Center for Entrepreneurship and Innovation has its own log-in. Contact the CEI at or (407) 823-3683 to inquire about access.