What are the sources of secondary information?

What are the sources of secondary information?

Ans The information required for demand and market analysis is usually obtained partly from secondary sources and partly through a market survey. In marketing research, a distinction is usually made between

primary information and secondary information. Primary information refers to information which is collected for the first time to meet the specific purpose on hand; secondary information, in contrast, is

information which is in existence and which has been gathered in some other context. Secondary information provides the base and the starting point for market and demand analysis. It indicates what is known and often provides leads and cues for further investigation.

General secondary sources of information

The important sources of secondary information useful for market and demand analysis in India are mentioned below-

Census of India— A decennial publication of the Government of India, it provides information on population.

National sample survey reports— Issued from time to time by the Cabinet Secretariat, Government of India, these reports present information on various economic and social aspects like patterns of consumption, distribution of households by the size of consumer expenditure, distribution of industries, and characteristics of the economically active population. The information presented in these reports is obtained from a nationally representative sample by the interview method.

Plan reports— Issued by the Planning Commission usually at the beginning, middle, and end of the five-year plans, these reports and documents provide a wealth of information on plan proposals, physical and financial targets, actual outlays, accomplishments, etc.

Statistical abstract of the Indian Union— An annual publication of the Central Statistical Organisation, it provides, inter alia, demographic information, estimates of national income, and agricultural and industrial statistics.

India Year Book— An annual publication of the Ministry of Information and Broadcasting, it provides wide ranging information on economic and other aspects.

Other publications— Among other publications mention may be made of the following: (i) Weekly Bulletin of Industrial Licences, Import Licences and Export Licences (published by the Government of India); (ii) studies of the economic division of the State Trading Corporation; (iii) commodity reports and other studies of the Indian institute of Foreign Trade; (iv) studies and reports of export promotion councils and commodity boards;and (v) Annual report on Currency and Finance (issued by Reserve Bank

of India).

Evaluation of secondary information

While secondary information is available economically and readily (provided the market analyst is able to locate it) its reliability, accuracy,  and relevance for the purpose under consideration must be carefully

examined. The market analyst should seek to know (i) Who gathered the information? What was the objective? (ii) When was information gathered? When was it published? (iii) How representative was the period for which information was gathered? (iv) Have the terms in the study been carefully and unambiguously gathered? (v) What was the target population? (vi) How was the sample chosen? (vii) How representative was the sample? (viii) How satisfactory was the process of information gathering? (ix) What was the degree of sampling bias and non-response bias in the information gathered? (x) What was the degree of misrepresentation by respondents? (xi) How properly was the information by respondents? (xii) Was statistical analysis properly applied?

Q4. What do  understand by the term market survey? How is being conduct

Ans. Secondary information, though useful, often does not provide a comprehensive basis for demand and market analysis. It needs to be supplemented with primary information gathered through a market

survey, specific for the project being appraised. The market survey may be a census survey or a sample survey. In a census survey the entire population is covered. (The word ‘population’ is used here in a particular sense. It refers to the totality of all units under consideration in a specific study. Examples are- all industries using milling machines, all readers of the Economic Times). Census surveys are employed principally for intermediate goods and investment goods when such goods are used by a small number of firms. In other cases, a census survey is prohibitively costly and may also be infeasible. For example, it

would be inordinately expensive to cover every user of Lifebuoy or every person in the income bracket Rs. 10,000-Rs. 15,000. Due to the above mentioned limitations of the census survey, the market survey, in practice, is typically a sample survey. In such a survey a sample of the population is contacted/observed and relevant information is gathered. On the basis of such information, inferences about the population may be drawn.The information sought in a market survey may relate to one or more ofthe following (i) Total demand and rate of growth of demand; (ii) Demand in different segments of the market; (iii) Income and price elasticity of demand; (iv) Motives for buying; (v) Purchasing plans and intentions; (vi) Satisfaction with existing products; (vii) Unsatisfied needs; (viii) Attitudes toward various products (ix) Distributive trade practices and preferences;(x) Socio-economic characteristics of buyers.

Steps in a sample survey

Typically, a sample survey consists of the following steps:

1. Definition of the target population— In defining the target population the important terms should be carefully and unambiguously defined. The target population may be divided into various segments which may have differing characteristics. For example, all television owners may be divided into three to four income brackets.

2. Selection of sampling scheme and sample size— There are several sampling schemes- simple random sampling, cluster sampling,sequential sampling, stratified sampling, systematic sampling, and nonprobability sampling. Each scheme has its advantages and limitations.The sample size, other things being equal, has a bearing on the reliability of the estimates— the larger the sample size, the greater the reliability.

3. Preparation of the questionnaire— The questionnaire is the principal instrument for eliciting information from the sample of the respondents. The effectiveness of the questionnaire as a device foreliciting the desired information depends on its length, the types of questions, and the wording of questions. Developing the questionnaire requires thorough understanding of the product/service and its usage, imagination, insights into human behaviour, appreciation of subtle linguistic nuances, and familiarity with the tools of descriptive and inferential statistics to be used later for analysis. It also requires knowledge of psychological scaling techniques if the same are employed for obtaining information relating to attitudes, motivations, and psychological traits. Industry and trade market surveys, in comparison to consumer surveys, generally involve more technical and specialized questions.

Since the quality of the questionnaire has an important bearing on the results of market survey, the questionnaire should be tried out in a pilot survey and modified in the light of problems/difficulties noted.

4. Recruiting and training of field investigators must be planned well since it can be time-consuming. Great care must be taken for recruiting the right kinds of investigators and imparting the proper kind of training to them. Investigators involved in industry and trade market survey need intimate knowledge of the product and technical background particularly for products based on sophisticated technologies.

5. Obtaining information as per the questionnaire from the sample of respondents— Respondents may be interviewed personally, telephonically or by mail for obtaining information. Personal interviews ensure a high rate of response. They are, however, expensive and likely to result in biased responses because of the presence of the interviewer. Mail surveys are economical and evoke fairly candid responses. The response rate, however, is often low. Telephonic interviews, common in western countries, have very limited applicability in India because telephone tariffs are high and telephone connections few.

6. Scrutiny of information gathered— Information gathered should be thoroughly scrutinized to eliminate data which is internally inconsistent and which is of dubious validity. For example, a respondent with a high income and large family may say that he lives in a one-room tenement. Such information, probably inaccurate, should be deleted. Sometimes data inconsistencies may be revealed only after some analysis.

7. Analysis and interpretation of data— Data gathered in the survey needs to be analysed and interpreted with care and imagination. After tabulating it as per a plan of analysis, suitable statistical investigation may be conducted, wherever possible and necessary. For purposes of statistical analysis, a variety of methods are available. They may be divided into two broad categories: parametric methods and nonparametric methods. Parametric methods assume that the variable or attribute under study conforms to some known distribution. Nonparametric methods do not presuppose any particular distribution.

Results of data based on sample survey will have to be extrapolated for the target population. For this purpose, appropriate inflatory factors,based on the ratio of the size of the target population and the size of the  sample studied, will have be to be used. The statistical analysis of data should be directed by a person who has a good background in statistics as well as economics.It may be emphasized that the results of the market survey can be vitiated by- (i) non-representativeness of the sample, (ii) imprecision and inadequacies in the questions, (iii) failure of the respondents to comprehend the questions, (iv) deliberate distortions in the answers given by the respondents, (v) inept handling of the interviews by the investigators, (vi) cheating on the part of the investigators, (vii) slipshod scrutiny of data, and (viii) incorrect and inappropriate analysis and interpretation of data.