Factsheet: Market research
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- Polly Atkins
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1 Factsheet: Market research A close understanding of the local childcare market and your customers needs is essential in order for your childcare business to succeed. Performing market research on potential customers and your competitors will help you to gain this knowledge. Through doing market research you will be able to find out: who is likely to buy your services how much they are willing to pay if the services you want to provide meet the needs/wants of potential customers if your location in an area where there is a need for childcare. And therefore be able to answer the question: Are you able to compete with new and existing childcare businesses and will there be a market for your business? Once you begin providing childcare, market research can also help you stay aware of changing demands of your market so you can adapt with it and stay in business. The results of your research should form the basis of your planning and help with future marketing activity. You can gain information about your market through primary and secondary Research. Primary research allows you to find out what your potential customers want in terms of price, quality, flexibility and service. If you can work out how they choose their childcare then you can tailor your services to fit their needs. Questionnaires are a useful tool or doing this and allow you to gain specific information about your customers needs.
2 Designing a questionnaire Questionnaires can help you to research new markets, measure customer satisfaction or find out more about people s perceptions of your services. Tips to help you design an effective questionnaire: 1. What are you trying to find out? You need to know what you want to find out and then write the questions around this. 2. How are you going to use the information? Make sure you know why you are asking each question and how you are going to use the results. If you are not going to use the results, there is no point in asking the question. 3. Quantitative or qualitative? Quantitative research provides statistical information for example, how many potential customers are there, or, 75% of respondents thought that Qualitative research is used to gain an understanding of attitudes and behaviours, asking how and why questions. 4. Telephone, web, postal or face-to-face? Self completion postal questionnaires can be a cost effective way to reach a large audience. Response rates generally tend to be lower than other methods. Telephoning can be costly by often generates a higher response rate, gives a fast turn around and also allows for further questioning. Faceto-face is usually the most costly and time consuming, however it can generate the fullest responses and enables you to target specific groups such as Children s Centres or parent and toddler groups. You can set up web based questionnaires using websites such as and out the link to your survey. This method is dependent on you knowing addresses for potential customers and response rates generally tend to be lower than telephone and face-to-face methods.
3 5. Keep it short and simple If you are going to ask your customers to answer your questionnaire make sure that it takes no longer than 10 minutes to complete. If you are using a printed questionnaire, make sure that it is no longer than two sides of A4. 6. Test your questionnaire This will allow you to time your questionnaire, make any final changes and get feedback from your colleagues. 7. Data Protection You should state that the information will be treated confidentially and provide details of how it will be stored. Suggested wording for your questionnaire: The information you provide will be used to, the information will be stored in accordance with the Data Protection Act 1998, and will be destroyed after 1 year. Respondents should be given the chance to receive feedback. 8. Analysis When you have gathered all of the responses, you must analyse the information. If the response rate was particularly poor you might need to send out some more copies in order to have realistic data on which to base your planning. Obtain permission to distribute your survey through local venues to reach the people that may become your customers. Think about the venues that are used by your target market such as: schools health clinics supermarkets libraries cinemas parks
4 Secondary research This is information and research gathered that has already been published. It may include: the number of children in the appropriate age group in the area the number of childcare businesses in the area and what services they offer the number of childcare places in the area new businesses in the area new housing developments in the area current emerging trends in childcare. Most of this information can be found in the Childcare Sufficiency Assessment (CSA). This report identifies the childcare needs in Barnet and any potential gaps in the market. The CSA is available online at Information on new housing and businesses in Barnet can be accessed from You can also search for official UK statistics online at It contains information about the General Household Survey, population trends, family expenditure etc Other useful sources of information include: local publications such as local newspapers, community newsletters and magazines covering local early years and childcare news national publications such as trade magazines and specialist marketing reports about the UK early years and childcare market. Remember: It is important that the validity of the data is checked and it is not out of date.
5 Know your competition Gaining an insight into your competition is very important. It is important to build up as much information as you can on local childcare businesses. You need to know what their services are, find out about their prices and reputation as well as how busy they are. If they have spaces available then perhaps there are already enough childcare places in the area. Find out how they advertise and promote themselves. Get a copy of their prospectus. Use this information you gather to produce a comparison table listing everything that might affect what you decide to offer, for example opening times, facilities and extra services. Think about their strengths and weaknesses and then compare them with yours and also think about where there could be opportunities or threats presented for your business. This is called a SWOT analysis and it may help you to see what customers value and you may identify a gap in the market. Keep up to date with potential developments / government initiatives that may increase competition in the future. For example, the government may have plans to open a local Children s Centre close to your business. Being aware of these developments will enable you to plan your business more effectively. Interpreting results Through thorough analysis of your market research you will be able to develop realistic and achievable business aims. While it can be tempting to pick out results that confirm what you want to hear, and ignore the rest, this approach is likely to damage your business. By making informed business decisions you will ensure that your business has the best chance of success.
www.doncaster.gov.uk
Market Research It is essential that market research is undertaken to establish there is a need for childcare within a specified area and have knowledge of the local community that a business wishes to
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