Identify and discuss the marketing research methods used by Dick Smith Foods in Australia to sell local products in the supermarket sector
Introduction:
Dick Smith Foods is a food brand that is created by the Australian entrepreneur Dick Smith for providing the alternatives of foreign-owned food company products as Australian owned and produced products.
The company was introduced in 1999 sue to larger market share of similar companies and the takeover that frequently occurred in previous Australian companies like Pauls and Arnott’s.
Dick Smith Foods was launched in the market as they hoped to perform better in such market condition. They do not manufacture their food; instead they acquire the products from other companies that are Australian-owned with the arrangement of licensing. In 2011, it was found that over the past five years the turnover of the company dropped from $80 million to $8 million.
The company took aggressive measures for marketing and thus they tried to establish their brad in the market (Dicksmithfoods.com.au, 2014).
Marketing research of Dick Smith:
Dick Smith Foods acts virtually as the umbrella brand for various independent Australian manufacturers. The company has to face larger competition in the market as they has to compete with large international firms who dominate the domestic market by and their products are basically on the shelves of the supermarket.
It is known that in Australian food market there is a tough competition in terms of acquiring a place in the shelves of the supermarkets and thus the firms need to make appropriate decisions and they need to apply appropriate marketing mix in order survive in the extensive competition in the market (Business.qld.gov.au, 2014).
There are basically two aspects on which Dick Smith has evaluated their positioning strategy.
- The company assumes that the consumers will support their products as their products are Australian made and thus the Australians should prefer their products over foreign brands.
- They claim that their products can offer more value than the other brands in the market as their price is lower than similar other products.
The company conducted a series of taste-tests. In the market research process the company compared Dick Smith’s Temptins with the Arnott’s Tim Tams.
Temptins were the duplicate product that was produced by Dick Smith by copying Arnott’s Tim Tam biscuits which were one of the top-selling products of the company.
After conducting the research it was found that 60% of the consumers preferred Dick smith products over Arnott’s products (Sontakki, 2010).
The research was conducted by a research company and after the research it was recommended by the company that Dick Smith should increase their prices for communicating superior value of their products.
Marketing research:
Marketing research can be described as a process that can link the consumers or the end users to the marketer by using various information and identifying the marketing opportunities in the industry. The main aim of the marketing research is to improve the understanding of the markets, monitor marketing performance and evaluate the necessary actions.
Information need to be collected for addressing various issues and then implementing the required measures. Thus in marketing research it is very important that appropriate information is gathered in terms of the competitors, market and customers. The information is basically gathered using two methods. The data collection methods are primary and secondary.
Primary research:
In the primary research the data is gathered originally from the source. In this case original information is gathered directly from the source and thus the process is more reliable. The primary research techniques include interviews and focus groups, direct observations and survey method.
Primary research basically gives the control over the nature of gathering the informational and the results can be extremely valuable to the researcher. But it is also evident that these processes can be time-consuming and it can be costlier.
Secondary research:
In the secondary research existing information is gathered through various available and reliable sources. Some of the secondary research examples are information from various government agencies & industry bodies, existing market research results and information on the internet.
These resources can be used effectively while conducting secondary research. In this research process issues can be faced in terms of finding the appropriate information related with the research that needs to be conducted. Secondary research is beneficial for understanding about the market but primary research is more effective in estimating the results and providing solutions for the problems (Kotler & Keller, 2012).
The marketing research can be of two types based on the nature of data that is gathered. They are quantitative research and qualitative research techniques.
In the quantitative research, quantitative data is gathered and for the qualitative research the qualitative data is gathered for the research. Where quantitative research uses the statistics, qualitative research gathers views and attitudes.
For marketing research it is very important to identify the issues that are faced by an organisation in terms of marketing and then various research problems need to be evaluated.
Producing a feasible question for the marketing research is necessary as the main objective of the research is to find solutions to those problems.
In this case Dick Smith Foods needed to find whether they should increase their prices of the product and how they should position themselves profitably in the market (McDaniel & Gates, 2012).
Recommendation and conclusion:
Here, several recommendations can be drawn for the company. Here the company needs to incorporate various other methods in their marketing research process. The company approached a marketing research agency for conducting the research.
Here it can be said that further primary research along with the secondary research needed to be conducted by the company (Smith & Stewart, 2001). The company researched on the customer response of their products in terms of only one product but there can be other competitors in the market and thus the research should have been extended for other products as well.
Here the secondary research is also important for identifying the market share of other brands in the market. Thus it can be concluded that marketing research is one of the significant process that needs to be conducted effectively in an organisation.
In Dick Smith Foods Company such method has been used effectively but extensive measures can resolve the problems of the company.
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