Importance of Market Research
Market research is a process through which information is collected regarding the potential opportunities that product and service providers can take advantage of . Typically two main kinds of marketing research are conducted; the first is primary research in which on ground information is collected directly from your target audience. The second is secondary research, in which already published or available research regarding a particular issue is utilized in order to make strategic marketing decisions .
In order to determine if A&W’s new pricing strategy of selling their ham and cheese burgers at lower costs than McDonald’s will work or not, can be researched using surveys and focus groups needs to be conducted.
Survey Research: McDonald’s Customer Profile
Before starting off with the marketing research process it is important to understand the primary target audience of McDonalds. Given the brand’s popularity, its customers include students as well as working professionals belonging to wide ranging age groups. Therefore the survey research that will be conducted will involve distributing questionnaires to a sample of respondents of McDonald’s customers. Majority of the questions would be related to the taste preferences, quality and price sensitivity of the target audience .
Specifically, the questionnaire will aim to determine which of the three above mentioned factors are the most important for the loyal customers of McDonalds. This is important because since it is a fast food brand, only relying on pricing research is not enough to determine the future effectiveness of reduced prices of A&W’s burgers .
Survey Research: A&W Customers
Given that A&W doesn’t currently have a significant market share in the fast food industry, it is important to narrow down the target audience to those individuals who are the most likely to switch from McDonalds to A&W on the basis of a reduced pricing strategy. Therefore in this case the sample population for the research will be restricted only to college and university going students. The reason for this selection is that students have a limited budget and are there for the most price conscious segment of the fast food industry. The questionnaire will aim to acquire information about which factor is given the most importance by A&W customers. This is an important strategy because if the results of the questionnaire reveal that the majority of its target audience will switch between brands of the basis of price then the strategy that A&W has used, has better chances to succeed .
Focus Group Research Studies
In addition to the close ended questionnaires that are used to collect the basic information regarding the food choices of people, focus group sessions also need to be conducted in which customers of both brands are made a part of the discussion. Since focus groups are meant to be a personalized interaction between people as they share their opinions on a given subject they are more time consuming and the findings of such sessions are difficult and complex to analyze and report. However focus groups offer one key benefit . The responses from the focus group members often provide unique insights into customer behavior as well as identifying the key factors that influence their brand selection.
In this case a joint focus group will reveal the one core reason why fast food eaters are prepared to pay higher prices for McDonald’s burgers rather than opting for any of the less costing alternatives in the market.
Research Findings
The survey based questionnaires used in the research should consist of close ended questions so that specific information can be acquired for the target audience of A&W and McDonalds. Since the data obtained is highly specific it will be easy to calculate in the form of numerical values. The information from the focus groups on the other hand, will be more detailed, less specific and therefore, more difficult to interpret in the form of numbers and figures .
In case the competitive research about the food choices and brand preferences of the customers at McDonalds shows that the target audience considers the quarter pounder to be a high quality yet expensive product, then, the reduced pricing strategy of A&W has greater chances of working. But this will only happen if the marketing efforts are directed towards college and university going students by A&W. This is because this particular target segment is looking to save as much money as possible and in certain cases is even willing to compromise on the quality of food that is being served.
Despite the fact that the research findings from the surveys and focus groups indicate that price is an important influencing factor for the fast food eating target audience, this in no way implies that the quality of the ingredients used or the taste of the burgers can be compromised on.
In my opinion, reducing the listing price of its one third pound burger would be a feasible promotion strategy if it is accompanied by a consistent quality and an appealing taste . This strategy will not only help retain A&W’s existing customers from switching over to other brands like McDonalds and Wendy’s, but also gain more attention and customer loyalty in the competitive market of fast food.
References
Richarme, M. (2005). Consumer Decision-Making Models, Strategies, and Theories. Arlington: Texas University Press.
Simpson, C. (2016, May 31). Research Is Key to Creating Promotions That Sell . Entrpreneur , pp. 3-7.
Thomas, J. W. (2016, April 13). Conducting Market Research . Entrepreneur , pp. 2-5.
