What is the most important step in the market research process Why What might occur if an error is made in this step - Essay Example

Market research demonstrates a continuous process that involves the collection and analysis of data on products and services, and business practices within the market in order to satisfy the needs of the customers (Stokes, n.d). It is essential to perform market research as a business grows as well as before developing new policies in business, or soliciting offers for acquisitions leading to bundled contracts. Research in the market allows for better decision making when choosing markets, developing new products and execution of marketing plans.

In addition, market research focuses on understanding the consumers, company capabilities, and the completion. Companies must understand and respond to how their customers perceive their products in relation to those of the competition. Although market research does not arrive at marketing decision by itself, when conducted in a systematic manner, it can aid in reducing uncertainty in the decision-making process. Therefore, for sound decisions to be made concerning marketing areas, which require change need to be defined and alternatives evaluated to increase the probability and magnitude of success.

This paper seeks to illustrate the essential step in the market research process and the effects of errors relating to this step. Market research being a systematic analysis of the data within a market, there are six main steps involved in the research process. These are defining objective and problem, determining research design, preparing research instrument, sampling and data collection, data analysis, and presentation of findings through reports (My Market Research Methods, 2011). The above steps are equally essential to the market research process and an error during execution can have a devastating result to company sales.

However, if an error is made during the first step of the process that is defining the problem, the whole process may give the correct information, but since the wrong questions were asked, the research does not serve its purpose. In this regard, the crucial step in market research process entails defining the problem and research objectives in accordance to the needs of the company. Therefore, in order to define the problem and objectives of the research, the management should transform their decision-making problem into a research question.

For instance, if a business enterprise has a decision problem on whether to launch a new product, the research objective should assess the acceptability in the market. This creates a means of answering their difficult questions by observing the response elicited by their consumers. The objective of the research should be clearly defined to ensure that the real problem is addressed. It is effectively defining the research problem and objective that ways on how to approach them can be decided. If a company fails to recognize the aims or objects during market research, the result is always being irrelevant to the actual needs of the company at the time.

This operates on the principle of junk-in-junk-out, where the wrong research problem leads to the wrong decision. Most companies are founded on the principle of profitability through the goods and services that they provide. Falling to understand the research problem can lead to wastage of time and resources, and eventually have a negative impact on company profits. For instance, in the mid-1980s the coca cola company made a devastating call, which saw the introduction of a new product only to be recalled later.

The company assumed that taste of their product was the determinant factor among consumers, thus formulating the wrong research problem and objectives. References Stokes, A. (n.d). Market research. Retrieved From http://oamp.od.nih.gov/ProgramNotes/Marketing/marketresearch.pdf My Market Research Methods. (2011). The Market Research Process: 6 Steps to Success. Retrieved From http://www.mymarketresearchmethods.com/the-market-research-process-6-steps-to-success/