CAIE A-Level Business 3.2 Market research Question Bank

Practise choosing, interpreting and evaluating market research evidence to support marketing, product and customer decisions.

[Maximum number: 9]

Direct News (DN)

Shila and Lucy own and manage DN, an online publishing business. DN produces a daily online local newspaper called QNews. Readers pay a subscription to access QNews. DN's mission statement is: 'to be a daily community newspaper for local people, about local people'.

DN recently tested a monthly online magazine aimed at the 18-30 age group called QLine. DN's plan is to stop publishing QNews and produce only QLine. Secondary market research suggests QLine will be popular with national businesses wanting to promote their products.

Shila is aware that revenue from online newspapers is decreasing. However, she has found national market research data about online monthly magazines (see Table 2.1).

Table 2.1 National revenue for online monthly magazines

Shila thinks that before the business decides to produce QLine, more market research data will be needed. Shila and Lucy will have to decide on new objectives for DN.

To ensure a quality product that meets customer expectations, Lucy thinks it is important to have careful management of the supply chain, from content creation to customer delivery.

(a)

Explain the term secondary market research (lines 6-7).

[ 3 ]

Explain the term secondary market research.

Figure for Answer to Question (a) — CAIE A-Level Business AS

Indicative content

AO1 Knowledge and understanding of secondary □ may include:

- Uses data that already exists

- Collected by someone else

- Can be from another organisation

No further marks can be gained without knowledge and understanding

AO2 Application to market research

Limited application ${ }^{\Delta=\mathrm{P}}$ applies knowledge of secondary market research including:

- Cheaper than primary research / outdated / not tailored to business

OR

- Example or some other way of showing good understanding of secondary market research.

Developed application $\Delta^{\Delta \rho F}+\Delta \rho F$ applies knowledge of secondary market research including

- Cheaper than primary research / outdated / not tailored to business

AND

- Example or some other way of showing good understanding of secondary market research.

Application can be made to DN or any other scenario/context/business/product.

2(a)(ii)

Accept all valid responses.

(b)

Refer to Table 2.1. Calculate the percentage increase in total revenue of online monthly magazines from 2020 to 2022.

[ 3 ]

Indicative content - Responses may include:

Revenue 2020 = 50 Revenue 2022 = 150

Change =150-50=100 (1)

Formula: Can be implied

Change / original $\times 100$ (1)

$(150-50) / 50 \times 100(1)$ $=100 / 50 \times 100=200 \%(3)$

Accept all valid responses.

Exemplars and annotations

Figure for Answer to Question (b) — CAIE A-Level Business AS

(c)

Explain one additional piece of market research data DN would find useful before making the decision to produce QLine.

[ 3 ]

Figure for Answer to Question (c) — CAIE A-Level Business AS

Indicative content

AO1 Knowledge and understanding

Knowledge of additional market research □ may include:

- Customer data

- Customer feedback

- What are forecast trends

- What subscription level are customers prepared to pay

- Information about competitors

- Potential size of the market

No further marks can be gained without knowledge and understanding.

AO2 Application

Limited application ${ }^{\Delta \text { se }}$ , applies knowledge to DN once.

- What potential readers want in a magazine

- Aimed at 18-30 market, so characteristics / requirements of this market

- Other online magazines available, do they charge a subscription fee?

- Plans to stop publishing QNews.

2(b)(ii)

Accept all valid responses.

[Maximum number: 12]

Fizzy Drinks (FD)

FD is a private sector business that manufactures an international brand of carbonated drinks. Its slogan was 'A premium drink for premium customers'. The market for FD's drinks is very competitive, with 7 national and 12 international brands all competing in the same market. Recently FD lost the title of market leader to TR, one of its largest competitors. TR is a multinational public limited company.

Table 2.1 FD financial data 2023

Employee morale has dropped as a result of the negative feedback. Key employees have left to work for FD's competitors. The lack of experienced employees has led to a drop in the productivity of the production process.

Evaluate the usefulness to FD of market research methods to inform future marketing decisions.

Figure for Answer to Question 3.2 Market research question 2 — CAIE A-Level Business AS

2(d)

Indicative content

Responses may include:

AO1 Knowledge and understanding

Knowledge of the features of marketing research methods to inform future marketing decisions (max 2 marks), including:

- Market research is the process of collecting, recording and analysing data about customers, competitors and the market

- Market research can be primary and/or secondary

- Market research data can be quantitative and/or qualitative

- Purposes of market research - understand the market, reduce risk, understand customers, predict trends

- Primary market research methods or examples

- Secondary market research methods or examples

AO2 Application

Context applied to features of market research methods to inform future marketing decisions (max 2 marks), including:

- International brand of carbonated drinks

- Research focused on customer preferences

- Slogan was 'A premium drink for premium customers'.

- 7 national and 12 international brands

- FD lost the title of market leader to TR

- Reduced its marketing budget.

- Evidence of high customer loyalty

- Change in ingredients led to FD's products tasting similar to their competitors

- Feedback highlighting a 'flavourless drink' and demand fell rapidly

- Brand name and customer loyalty was lost

2(d)

AO3 Analysis

Limited analysis - candidate shows one link in the chain of analysis.

Developed analysis - candidate shows two or more links in the chain of analysis.

- Primary research data; understand customer needs - so can increase sales

- Can help decide whether new business ideas are suitable/relevant; reduces long term costs of a failed product/brand

- Identify products customers find appealing; reduces marketing budgets

- Make packaging and branding decisions; attract customer interest

- May not provide much unknown data; data may already exist so not increase sales

- Is there marketing budget suitable; may not have enough finance

AO4 Evaluation

Limited evaluation - unsupported judgement and/or a weak attempt at evaluative comment

Developed evaluation E - supported judgement and/or reasonable evaluative comment Developed evaluation in context ${ }^{[\text {EE }]}$ - supported judgement in context and/or reasonable evaluative comment in context.

- A judgement about the likely usefulness to FD of market research methods to inform future marketing decisions.

- Elements that the judgement could depend upon, available finance, brand reputation, competitor branding, taste, trust.

- Weighing up of the impacts on external factors to the proposed of market research methods to inform future marketing decisions.

2(d)

Accept all valid responses.

Exemplars for awarding evaluation

□

L1 (limited supporting evidence)

L2 □ (developed supporting
evidence)

L3 ${ }^{\text {[EE] }}$ (developed supporting evidence
with context)

Market research methods
are useful to FD.

Market research methods are useful to
FD because it can help the business
make decisions to better meet customer
needs.

Market research methods are useful to FD
because it can help the business make
decisions to better meet customer needs
and therefore regain its position as market
leader.

FD should not use market
research methods to
support future marketing
decisions.

FD should not use market research
methods to support future marketing
decisions in case the data is misleading.

FD should not use market research
methods to support future marketing
decisions, such as reducing the quality of
ingredients in its drinks, in case the data is
misleading.

In the short-term market
research methods are a
good way to inform future
marketing decisions.

In the short-term market research
methods are a good way to inform future
marketing decisions, but in the long-term
changes in the external environment may
reduce the value of the market research
data.

In the short-term market research methods
are a good way to inform future marketing
decisions, but in the long-term changes in
the external environment may reduce the
value of the market research data,
especially as the market is competitive
with 7 national and 12 international
brands.

[Maximum number: 5]

(a)

Define the term primary research.

[ 2 ]

(b)

Explain one limitation to a business of using sampling.

[ 3 ]

All question bank results loaded

CAIE A-Level Business 3.2 Market research Question Bank

Exam points

Covered syllabus points

Covered syllabus points

3.2 Market research question 1

Question (a)

Question (b)

Question (c)

3.2 Market research question 2

3.2 Market research question 3

Question (a)

Question (b)