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Strategic Global Research:
Qualitative Research In China
Category: International Retail
Methods: International Research, Strategic Research,
Depth Interviews, Ethnographic Research, Focus Groups, Quantitative Research,
Qualitative Research
Summary
A U.S.-based retailer wanted to evaluate an emerging market as part of their
long-term expansion strategy. This research was undertaken to provide strategic
direction for markets in China.
Strategic Issues
With a GDP of over $7 trillion estimated in 2007, China ranks second in global
economies, behind only the United States. With a growth rate of about 12% annually,
China’s GDP will most likely overtake the United States’ GDP in
the next several years. China’s ever-growing middle class has more and
more disposable income, making China a growing market that our client wanted
to explore.
Research Objectives
Our client had previously conducted a few quantitative research projects in
China, mainly on market size. In addition to an update on the previous research
data on their market size, the client wanted to gain a deeper understanding
about consumers, their perceptions of the market, how they shop for and purchase
relevant products, and how they interact with professionals in a real environment.
Thus, a qualitative study was required. The objectives of the research were
to:
- Define the overall market-size potential based on consumer data.
- Better understand the market, as well as the competitive landscape.
- Provide baseline learning of the market, and cultural and historical differences
in their industry, to help prepare the organization for conducting business
in China.
Research Design and Methods
The research plan included quantitative research to determine the size of the
market (today, as well as in the near future). It also included qualitative
research to better understand the motivations, as well as the purchase behaviors,
of consumers in the market.
- The qualitative research included focus groups among homogeneous consumers
(those of same social class, product ownership categories, etc.) in several
key markets in China.
- The qualitative research also included ethnographic research observing consumers
in their homes interacting with the product categories in which the client
was most interested, as well as conducting depth interviews among these consumers
about these product categories of interest.
Reporting
Quantitative research was reported in statistical tables, data files, and a
summary report of key findings. Similar quantitative research had been conducted
several years earlier and was able to be used as a point of comparison to determine
how much the market had changed during this time frame.
Qualitative research was reported via summary reports for each of the different
consumer groups, as well as one overall report with strategic issues outlined
with recommended approaches. In addition, the video files and photographic images
were provided to the client. The photographic images were incorporated into
the report to provide better understanding of the consumers, the product categories
in use within consumer homes, and the various levels of sophistication and economic
status achieved by consumers using these key product categories.
Results
With the information, our client was able to:
- Prepare recommendations and the best strategies to enter the Chinese market.
Information was shared with the management team, as well as the board of directors.
- Prepare business plans and scenarios for expanding into China on various
timelines and at various levels of commitment.
- Provide detailed information about how the retail organization would need
to be modified, compared to its base operations in the U.S. Discoveries and
recommendations were made regarding current unmet consumer needs; consumers
most likely to be attracted to the retailer; location needs; format of the
locations; merchandising, brand, and product selection; and pricing, staffing,
training of staff, marketing, and advertising, etc. Of course, additional
research is required to fully understand the market and to begin developing
tactics for implementation. However, based on this research, initial strategic
plans were designed.
Copyright © 2009 by Decision Analyst, Inc.
This case history may not be copied, published, or used in any way without written
permission of Decision Analyst.
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