Secondary Data

Quantifying the Target Market

The Target Market• Who are they? What are their ages,

incomes, race, household characteristics, employment and education qualities?

• Where are they? What counties, states, cities, metropolitan statistical areas have the greatest concentration of these persons.

• How many are there? What places have a sufficient number to make it feasible to do something unique for this group?

Segmentation Analysis

• Demographics provide the key to the size of the target market—“substantiality”

• Attitudes to price, willingness to pay more for certain product features

• Importance of brands, will a brand segment show distinct differences?

• Where they purchase, their purchase habits, when and how much.

• How can they be reached—reachability, what do they watch, read, listen—when and where?

PRIMARY vs. SECONDARY DATA

Primary data refers to information that is developed or gathered by the researcher specifically for the research project at hand.

Example: Maidenform conducts 3000 extensive survey of women between the ages of 21-65 following agreement at a preliminary mall intercept interview—identifies major underlying problem with regard to their understanding of their current customers.

PRIMARY vs. SECONDARY DATA

Secondary data refers to information that has previously been gathered by someone other than the researcher and/or for some other purpose than the research project at hand.

Example: Maidenform examines MediaMark reports for shopper profiles of its leading retailers and examines the relationship with product shipments—identifies major underlying problem with regard to their understanding of their current customers.

Project: Exploratory Research

• Descriptive Consumer Profile: Based on Nielsen Homescan data and Mediamark Reports. Identifies the key demographic characteristics of the heavy user household.

• Update of segmentation demographics from Electronic databases—via U/A Library

• Excel spreadsheet of geographic areas sorted to identify the most attractive markets.

• Summary discussion providing recent articles reflecting marketing in this product category.

Used-Car Analogy“Everyone drives a used car”

• Once data has been collected—it’s secondary data.• Reliable: Others have found it to be dependable in

decision making (and have published from it).• Economical: Far less expensive than attempting

to collect it yourself.• Basic transportation: Does it improve your

decision making, does it get you from a place of “uncertainty to greater understanding”?

SpeedReadily available, can be obtained quickly

Several providers competing, most forms available electronically.

Search costs have dropped geometrically due to the availability of Internet search engines.

Inexpensive

Inexpensive compared to primary data Competitive information markets, and with

many electronic suppliers, it’s possible to compare sources rapidly—leading to price competition.

It is just not possible for a single firm to collect the depth of data that a specialist can accomplish.

Complementary

Can be used with sales data to estimate total market size and competitor profitsFirm “A” knows its sales in a sales territory.

Applying national consumption statistics, it can estimate its market share.

Unbiased third party source, can be agreed to by supplier and retailer.

Types of Secondary Data

• Internal Secondary Data• Using the firm’s own data• Financial records on marketing expenditures• Sales data by customer

• External Secondary Data• Published Sources (Census Materials)• Syndicated Services• External Databases

Types of Computerized, or “on-line” Databases

Bibliographic DatabasesFinding previous research on the topic: Social Science

Citation Index, ABI-Inform

Numeric DatabasesCensus reports

Directory DatabasesTrade associations, Gale’s Associations Unlimited

Full-text DatabasesLexis-Nexis Academic Universe, ABI, Wall Street Journal

Three Major External Databases

• ProQuest Direct

• Ebsco Universe

• Lexis/Nexis’ Academic Universe

Census of Population and Housing

• Statistics gathered– Census (100-Percent data)– Sample

• Geographic aggregations

• Accessing data through downloads

“100-Percent Data”

• Numbers of persons

• Ages

• Language and Race

• Households

• Related and unrelated individuals

Census Sample Data 1/6 Households

• Educational attainment (by age)

• Occupation of individuals

• Housing characteristics

• Household income

Mediamark

• Describes the most frequent purchaser, or the broadest consumer profile in terms of demographics and media usage.

• Describes the heavy-user• Provides a profile of the purchaser

purchasing at a rate disproportional to their frequency in the population.

• http://www.mediamark.com/

Total 197,462 17,284 100 8.8 100 Men 94,827 6,358 36.8 6.7 77 Women 102,635 10,926 63.2 10.6 122 Household Heads 120,805 9,994 57.8 8.3 95 Homemakers 120,712 11,810 68.3 9.8 112 Graduated College 43,406 4,772 27.6 11 126 Attended College 52,173 4,299 24.9 8.2 94 Graduated High School 66,168 5,890 34.1 8.9 102 Did not Graduate High School 35,715 2,322 13.4 6.5 74

Vitamins: Heavy UsersAdultBase

HeavyUsers

%Users

%Adults

Projected Users

• A large national sample is developed for a report, usually greater than 1,000 persons are interviewed.

• From this sample, complete demographics are obtained from the respondent.

• Each report developed by Mediamark is a demographic breakdown of the response to a single survey question.

• The number projected is based on the proportion in the sample and how representative the sample was (“percent down”),

• Applying this to an estimate of the total population provides projected users.

Vitamins: Heavy Users

Total 197,462 17,284 100 Men 94,827 48.0% 6,358 36.8% Women 102,635 52.0% 10,926 63.2% Household Heads 120,805 61.2% 9,994 57.8% Homemakers 120,712 61.1% 11,810 68.3% Graduated College 43,406 22.0% 4,772 27.6% Attended College 52,173 26.4% 4,299 24.9% Graduated High School 66,168 33.5% 5,890 34.1% Did not Graduate High School 35,715 18.1% 2,322 13.4%

% of adults(not shown)

Index: The ratio of percent of users to demographic percent of adult population

Total 197,462 100 17,284 100 100 Men 94,827 48.0% 6,358 36.8% 77 Women 102,635 52.0% 10,926 63.2% 122 Household Heads 120,805 61.2% 9,994 57.8% 95 Homemakers 120,712 61.1% 11,810 68.3% 112 Graduated College 43,406 22.0% 4,772 27.6% 126 Attended College 52,173 26.4% 4,299 24.9% 94 Graduated High School 66,168 33.5% 5,890 34.1% 102 Did not Graduate High School 35,715 18.1% 2,322 13.4% 74

Vitamins: College Graduates

126%0.22

%6.27

462,197406,43

248,17772,4

population %

users %eIndex valu

Mediamark Cautions

• Be sure information on a particular demographic is based on 50 or more respondents (those with fewer than 50 subjects responding affirmative to two items carries an asterisk (*).

• For example, fewer than 50 persons ages 55-64 in sample responded affirmatively that they “had purchased a tent in the last 12 months.”

• Avoid being dependent on this information in building your profile.

Mediamark Cautions

• Only analyze the index values when it correspondents to a segment characteristic being a significant (>20%) of the users.

• Correct: “Persons 55-64 (age) constitute 21% of all heavy vitamin and mineral users, a disproportionate share (Index=189).

• Dangerous: “Persons whose marital status is “other” account for 12.3% of all purchasers of tents, a disproportionate share (Index =159)