Understanding and Meeting Customer Needs
Meeting customer needs starts with market research, which is either primary research, new data collected directly, such as surveys, questionnaires and focus groups, or secondary research, existing data that has already been published elsewhere, such as government or industry reports.
Before you start
Make sure you're comfortable with these topics first:
Method
- Learn the difference between primary market research, new data collected directly, for example surveys, questionnaires or focus groups, and secondary market research, existing data already published, for example a government report.
- Learn the definition of market segmentation: dividing a market into groups of customers with similar characteristics or needs, for example by age, income, location or lifestyle.
- Learn why businesses must understand customer needs before launching or changing a product: to reduce the risk of designing something the target market does not actually want.
- Learn how a business's product, price and marketing should be adjusted to fit a specific customer segment's needs.
- For explain questions, name the specific customer need identified through research and link it to the change the business makes in response.
- For analyse or evaluate questions, trace how well the business's decisions match the evidence about customer needs, and reach a judgement about whether the evidence supports the decision made.
Worked example
A gym carried out a survey of local residents and found that the most common reason people who did not currently belong to a gym gave for not joining was a lack of childcare during daytime hours. Explain how the gym could use this market research finding to better meet local customer needs.
- Identify the finding: the main barrier stopping local residents from joining is a lack of childcare during the day.
- Identify the unmet need this reveals: parents with young children want to exercise but cannot attend without childcare being available.
- Link the finding to a specific business response: the gym could introduce a supervised creche or childcare session during its quietest daytime hours.
- Link the response back to the customer need: this directly removes the barrier the survey identified, making it realistic for parents to attend, which the gym could not achieve if it ignored the finding.
- Write the explained conclusion, connecting the specific research finding to the specific service change and the resulting customer benefit.
Practice questions
Try each question, then tap to reveal the answer.
Q1State the difference between primary and secondary market research.Show answer
Answer: Primary research is new data collected directly by or for the business, for example a survey; secondary research is existing data that has already been published by someone else, for example a government report.
Q2Give one example of a primary market research method.Show answer
Answer: For example, a questionnaire, survey, focus group, or interview.
Q3Define market segmentation.Show answer
Answer: Dividing a market into groups of customers with similar characteristics or needs, for example by age, income, location or lifestyle.
Q4State one characteristic a business might use to segment its market.Show answer
Answer: For example, age, income, location, or lifestyle.
Q5Explain why a business should carry out market research before launching a new product.Show answer
Answer: To reduce the risk of developing something customers do not actually want or need, based on real evidence rather than guesswork.
Q6Give one disadvantage of relying only on secondary market research.Show answer
Answer: It may not be specific to the business's exact target market, or may be out of date, unlike research carried out directly for the business.
Exam-style questions
Written in the style of a GCSE Business exam paper, with a full mark scheme.
Explain two benefits of primary market research over secondary market research when a business is developing a new product.
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A sandwich shop near a university surveyed 200 students and found that 78 percent said they wanted more plant-based options, and 65 percent said they usually buy lunch between 12pm and 1pm. Based on these findings, the shop owner decided to launch two new plant-based sandwiches and to hire an extra member of staff, but only for the hours between 3pm and 5pm. Evaluate whether the shop owner's decisions are well supported by the market research findings.
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See real GCSE Business past-paper questions, with official mark schemes →
Free printable worksheet
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