Introduction to Market Research

Abstract

When Toyota developed the Prius – a highly fuel-efficient car using a hybrid petrol/electric engine – it took a gamble on a grand scale. Honda and General Motors’ previous attempts to develop frugal (electric) cars had not worked well. Just like Honda and General Motors, Toyota had also been working on developing a frugal car but focused on a system integrating a petrol and electric engine. These development efforts led Toyota to start a development project called Global twenty-first century aimed at developing a car with a fuel economy that was at least 50% better than similar-sized cars. This project nearly came to a halt in 1995 when Toyota encountered substantial technological problems. The company solved these problems, using nearly a thousand engineers, and launched the car, called the Prius, in Japan in 1997. Internal Toyota predictions suggested that the car was either going to be an instant hit, or that the take-up of the product would be slow, as it takes time to teach dealers and consumers about the technology. In 1999, Toyota made the decision to start working on launching the Prius in the US. Initial market research showed that it was going to be a difficult task. Some consumers thought it was too small for the US, some thought the positioning of the controls was poor for US drivers, and there were other issues, such as the design, which many thought was too strongly geared toward Japanese drivers.

Learning Objectives

After reading this chapter, you should understand:

– What market and marketing research are and how they differ.

– How practitioner and academic market(ing) research differ and where they are similar.

– When market research should be conducted.

– Who provides market research and the importance of the market research industry.