Market Research (DP IB Business Management: HL): Exam Questions

FreshBloom Florists is a boutique floral service offering custom-made arrangements for special occasions. The company plans to expand its services to include same-day delivery, targeting urban customers who value convenience.

To understand customer preferences, FreshBloom is conducting both primary and secondary market research. Primary methods include customer surveys and test markets for the same-day delivery service, while secondary research focuses on industry reports and competitor data.

FreshBloom is particularly interested in identifying the most popular delivery time slots and the preferred pricing model for urban customers. The company must carefully evaluate the effectiveness of its research methods to ensure the success of the new service.

FreshBloom Florists is a boutique floral service offering custom-made arrangements for special occasions. The company plans to expand its services to include same-day delivery, targeting urban customers who value convenience.

To understand customer preferences, FreshBloom is conducting both primary and secondary market research. Primary methods include customer surveys and test markets for the same-day delivery service, while secondary research focuses on industry reports and competitor data.

FreshBloom is particularly interested in identifying the most popular delivery time slots and the preferred pricing model for urban customers. The company must carefully evaluate the effectiveness of its research methods to ensure the success of the new service.

HealthyPets Products is a company specialising in eco-friendly pet food and accessories. The company has built a reputation for creating sustainable products that appeal to environmentally conscious pet owners. HealthyPets is planning to launch a new line of biodegradable pet food packaging that is designed to reduce waste while keeping the food fresh.

To ensure a successful launch, the company has decided to conduct primary market research. This includes focus groups with pet owners to gather opinions on the design and functionality of the packaging and interviews with pet store managers to understand their preferences for stocking sustainable products.

HealthyPets Products is a company specialising in eco-friendly pet food and accessories. The company has built a reputation for creating sustainable products that appeal to environmentally conscious pet owners. HealthyPets is planning to launch a new line of biodegradable pet food packaging that is designed to reduce waste while keeping the food fresh.

To ensure a successful launch, the company has decided to conduct primary market research. This includes focus groups with pet owners to gather opinions on the design and functionality of the packaging and interviews with pet store managers to understand their preferences for stocking sustainable products.

Elite Style is a premium hairdressing business located in a busy city centre. The salon specialises in personalised hair care and styling services for working professionals and high-income clients. To remain competitive, Elite Style plans to launch a new express styling service aimed at busy professionals who require quick and high-quality hair styling during lunch breaks.

The salon is using secondary market research to understand demand trends and identify gaps in the market. This includes reviewing industry reports on professional grooming trends, analysing competitor offerings, and using data from government publications on urban working populations. However, Elite Style also faces challenges, such as the high cost of specialist reports and the risk of relying on outdated or irrelevant data.

Elite Style is a premium hairdressing business located in a busy city centre. The salon specialises in personalised hair care and styling services for working professionals and high-income clients. To remain competitive, Elite Style plans to launch a new express styling service aimed at busy professionals who require quick and high-quality hair styling during lunch breaks.

The salon is using secondary market research to understand demand trends and identify gaps in the market. This includes reviewing industry reports on professional grooming trends, analysing competitor offerings, and using data from government publications on urban working populations. However, Elite Style also faces challenges, such as the high cost of specialist reports and the risk of relying on outdated or irrelevant data.

GreenScape Ltd. supplies landscaping tools. A recent analysis of monthly sales (in units) for a new product showed fluctuating demand. Management wants to determine the median sales figure to assess typical monthly performance.

Monthly Sales (Units)

Elite Style is a well-established premium hairdressing salon located in the heart of a busy city centre. Over the last 12 years, the salon has become synonymous with personalised hair care and high-quality styling services aimed at working professionals and high-income clients. Its reputation has been built on attention to detail, luxury experiences and delivering exceptional results that reflect the salon’s premium pricing strategy

In response to shifting customer demands, Elite Style is preparing to introduce a new express styling service targeting busy professionals. The service will focus on quick, high-quality styling, including blow-dries, trims and styling touch-ups, all completed within a 30-minute timeframe. This initiative aims to attract clients looking for convenient solutions during lunch breaks or before meetings. Management has set a tentative price of $40 per appointment to reflect the salon’s premium image while remaining competitive

To justify the new service, Elite Style’s management team has relied heavily on secondary market research. Sources include industry reports on grooming trends, a competitor analysis and government data on local working populations. Data shows that 70% of full-time professionals in the city take 30–45-minute lunch breaks, and demand for quick grooming services has increased. Competitor research reveals that other express salons offer services ranging from 20 to 45 minutes, with customer satisfaction scores ranging between 82% and 91%

However, relying solely on secondary research carries risks. Specialist market reports are expensive, and there is concern that the data may be outdated or too broad for Elite Style’s niche clientele. Management recognises that additional primary market research may be needed to tailor the service to client preferences

Operationally, launching the express service will require adjustments. Elite Style will need to train existing staff, hire part-time stylists and invest in faster equipment to meet the express timeframe without compromising on quality. While the initial setup cost is estimated at $18,000, financial forecasts suggest that the express service could generate a net profit of $22,000 within six months if operational targets are met

The launch also presents opportunities for differentiation. Elite Style could bundle the express service with additional perks, such as complimentary consultations, loyalty schemes or corporate packages. The key challenge will be to ensure the service remains efficient while maintaining the premium standards the salon is known for

Table 1: Competitor analysis

Table 2: Financial forecast for the express styling service (first six months)

Graph 1: Preferred hair styling service duration by urban professionals

The graph below shows customer preferences for express hair styling durations, based on Elite Style’s secondary market research

Sunrise Cafe is a family-owned coffee shop in a busy urban neighbourhood. The cafe is known for its high-quality artisan coffee and cosy atmosphere. Recently, the owners introduced a new menu item called CoffeeFusion, a premium cold brew infused with exotic flavours. The recipe for CoffeeFusion was developed using a product-orientated approach, focusing on creating unique flavours and using innovative brewing techniques

Despite their efforts, CoffeeFusion sales have been lower than expected. Many customers say they prefer simpler and more affordable options. In contrast, a competitor, QuickBrew, has seen strong sales growth by offering low-cost, convenient drinks. Sunrise Cafe’s revenue last quarter was $51,275, while QuickBrew earned $99,862, showing the difference in their strategies

The owners of Sunrise Cafe are considering a shift to a market-orientated approach. They want to understand their customers better and adjust their menu to meet customer preferences. To do this, they plan to carry out market research. They will use surveys to ask customers about their tastes, how much they are willing to pay for premium products and which new drinks they would like to see. Focus groups with regular customers will provide detailed feedback on CoffeeFusion and alternative products. The cafe also plans to study QuickBrew’s prices, promotions and customer satisfaction to learn what works well for competitors. Additionally, the owners will look at their own sales data to identify which products are most popular with their customers

Sunrise Cafe’s goal is to attract more loyal customers, grow its market share and reach a quarterly revenue target of $65,425 within the next year. The owners are deciding whether to improve CoffeeFusion’s recipe or offer simpler, lower-cost cold brews to compete more directly with QuickBrew

Table 1: Comparative performance metrics

Table 2: CoffeeFusion customer feedback