Define the purpose of market research
Use research to understand market size, growth, competitors and customer profiles, wants and needs before making decisions.
Section 3.2 · Market research
Cambridge International AS & A Level Business 9609, 2026–2028 syllabus and 2029 syllabus, section 3.2.1. Cambridge states that the 2029 syllabus has no significant changes affecting teaching. This lesson maps only its named section; other sections and full paper practice remain separate. Written practice is self-checked
Before you begin
- No previous business course is assumed. Use the lesson's definitions before applying them to the business context.
Work on paper. Try each question before revealing help, and explain why your method works.
Quick readiness check
Which is a purpose of market research?
What you will learn
- Identify the market questions research can answer
- Distinguish customer profiles from customer needs
- Connect research findings to a decision
Research reduces uncertainty about the market
Market research can estimate market size and growth, identify competitors and compare their offers. It can also investigate customer characteristics, profiles, wants and needs.
A profile describes features of a group; a want is a desired product or outcome, while a need is the problem or requirement the customer seeks to address. Research should specify which customers, product category, location and period are being studied.
Start with the decision, not a pile of data
A clear research question might ask whether enough local customers would pay for evening delivery, or which features matter when choosing a tutoring service. The answer should help a business choose a product, price, promotion or place decision.
Research cannot remove uncertainty. Definitions, sampling, response and timing affect findings. Collecting information with no decision in mind wastes resources and can encourage overconfidence.
Pause and explain
A firm wants to estimate competitors and customer needs before launch. What is this?
Worked example
A gym is considering opening a second site. State two market-research questions that would help before it commits.
Show the worked solution
- Estimate the size and growth of the relevant local fitness market.
- Identify competitors and customer needs in the proposed area.
- Link findings to expected demand and the site's capacity and cost.
Answer It should estimate how many potential customers are within a realistic travel area and whether the market is growing. It should also identify competing gyms and research what local customers want, such as opening hours or classes, then compare the likely demand with site costs.
Try a topic test
Choose Easy, Normal or Difficult. Save your answers and open worked review after finishing.
Test this topic →From guided practice to a new situation
Write your answer and reasoning first. Use a hint only if you are stuck. The model solution is for self-checking; your written work is not automatically marked.
A school-supplies retailer wants to add delivery. Write two research questions about customers and the market.
Give me a hint
Ask about reachable demand and existing alternatives.
Compare my reasoning
- Identify who could use delivery and when.
- Ask about current alternatives or unmet service needs.
- Define the location and period for each question.
It could ask how many target households or schools would use delivery during the term and which delivery windows they need. It should ask what alternatives they use and where service gaps exist, limiting the research to the intended delivery area.
Look for these in your work
- Questions are decision-relevant
- Customer needs and market context are covered
- Market scope is defined
A survey finds that 70% of respondents like a proposed snack. Explain why the result does not establish market size or sales.
Give me a hint
Separate stated preference from a representative count and actual behaviour.
Compare my reasoning
- Check who responded and how they were selected.
- Liking is not the same as buying at a stated price.
- Estimate reachable buyers and test actual purchase behaviour.
The result only describes respondents' stated reaction. It does not establish how many eligible customers exist, whether the sample represents them or whether respondents will buy at the proposed price. A representative sample and a small sales test would provide different evidence.
Look for these in your work
- Sample is considered
- Attitude is distinguished from behaviour
- A stronger evidence step is suggested
A restaurant has data on customer age but not why diners choose it. Explain what additional research could reveal and how the answer might be used.
Give me a hint
Research wants, needs or choice criteria, then connect findings to an offer decision.
Compare my reasoning
- Ask about the problem or benefit diners seek.
- Use interviews or a focused survey with relevant customers.
- Use the pattern to test menu, price or service changes.
Interviews or a focused survey could explore diners' reasons, such as convenience, dietary needs or atmosphere. If a consistent need appears, the restaurant can test a menu or service adjustment and measure customer response rather than assuming age explains choice.
Look for these in your work
- A relevant customer question is proposed
- A suitable method is named
- Findings inform a testable decision
Common mistakes
- Researching an entire country when the decision concerns one neighbourhood
- Treating stated interest as a guaranteed purchase
- Collecting data without a clear decision question
What can you explain now?
Which is a purpose of market research?
Compare with the explanation
Understand customers and market conditions before a decision
Research can inform customer, competitor and market-size decisions.
After trying it yourself, choose your next review. This is your self-assessment.
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Make it stick
What market and customer questions can research answer, and why should each study begin with a decision?
If you needed the solution, close it and solve the problem again from a blank page. A correct answer is stronger when you can explain the reason for each step.