The Big Wind
MGT-541 Advanced Marketing Management
March 16, 2012

The Big Wind 1. What type of research should Urs do?

Urs has many different issues that she is facing in making this windmill decision. Urs must first conduct market research. Market research has a variety of purposes and a variety of data collection methods that can be utilized for each purpose. What Urs needs to understand is that no small business can succeed without understanding who the potential customers might be, how those products and services affect the customers, and the market in general. Competition is often fierce, and operating without conducting research may give competitors an advantage. There are two ways to do market research, primary and secondary research. ("Market Research," 2010) As a general rule, a thorough research of the secondary data should be undertaken prior to conducting primary research. Using information gleaned from secondary sources, the owner can uncover all kinds of demographic information, including detailed income data and spending patterns. The secondary information will provide a useful background and will identify key questions and issues that will need to be addressed by the primary research. Performing secondary market research means obtaining information from sources such as trade journals and magazines where published papers, directories and even market statistics can be found. Useful qualitative data can be found in trade association figures, government and industry forecasts, white papers as well as in research reports. All these will help the business owner ask the fundamental questions; what are the current dynamics of the market, what are the growth prospects, where could the risks lie and what is the potential for this new product or service. Urs needs to be careful however, using only secondary research can be problematic. Relying on the published work of others does not provide the business owner with the full picture. Secondary research can be a great place to start, but the information that can be gleaned from this type of research can be outdated. Other factors relevant to the success or failure of this new business could be missed without doing primary research. In collecting primary research the business owner needs to be sure to include the following; interviews, which can be done either by, telephone or face-to-face, surveys, and questionnaires, which can be done by phone or by, mail. Other options include doing a focus group, which is gathering of a cross section of potential clients or customers, and getting their direct feedback on the product that is being proposed. The questions that should be a part of the focus group should include; what factors are considered when purchasing this product or service, what does the customer like or dislike about current products or services currently on the market, what areas would the customer suggest for improvement of this project, and what is the appropriate price for a product or service? Another question that needs to be considered is where does the customer currently go for that to purchase that product or service and then ask why. In this particular case when crafting the business plan for the windmill project it is critical to thoroughly understand the target customers. Urs should conduct more research on her target market. The best place to begin is to take a more in-depth look at the competition. Assuming the research process has helped to uncover the competition, now it is imperative is to find out what how the competition has become successful to this point. Urs should visit the company’s’ Web site and put her name on their mailing list. Any information that she could glean from their promotional material could be helpful. Another option for Urs is to speak with the competitor's customers. Urs may want to ask what they like or don't like about the competitor's product or service. The purpose is to understand what your competition is doing so the company that is being built can do it better. Perhaps the current competition has poor service; perhaps the windmill that the competition produces is flawed. Or maybe Urs has figured out a way to do things better, smarter, and more cost-effectively. It is important for Urs to find the selling point for the windmills. It's going to be the core of the windmill-marketing program. The selling point is also going to be what sets the windmills that Urs is producing apart from the competition. In this particular case, given the fact that funds are short, Urs would be best served by principally using a secondary approach to doing market research. To be more specific Urs should make use of the Internet and information freely available from competitors. These would be the best, and least expensive sources of information. After this information is gathered the secondary research should be followed by the primary research utilizing a small focus group and perhaps an e-mail survey of potential customers.

2. What different research methods should be required to assess the demand for farmers versus small business? The best and most simple approach is for Urs to obtain advice from experts. There are several methods for obtaining this advice, which would include contacting experts at the U.S. Department of energy and other government agencies, attending seminars and workshops, or hiring a marketing consultant. An alternative step that Urs should take is to speak with successful manufactures of similar products. The best option would be to speak with successful windmill manufactures in other markets other than the one that Urs is trying to develop. Successful business owners like being asked for help and successful business people like to talk about their successes and especially themselves. Learning the ups and downs from someone who has experienced the highs and lows of the windmill industry can be invaluable to the success of this new business venture. Another option Urs could employ is to survey farmers in her market area to learn more about the farmers current level of knowledge of using windmills to generate power, preferences for using alternative energy sources, and general dissatisfaction with existing utility providers. Using the exploratory research method would also be helpful to Urs in assessing the demand for generating wind power for farmers versus small business owners. Exploratory research is used principally to gain a deeper understanding of something. Exploratory research would be beneficial in this case because it can be informal, relying on secondary research such as reviewing available literature and/or data, or qualitative approaches such as informal discussions with consumers, employees, management or competitors, and more formal approaches through in-depth interviews, focus groups, projective methods, case studies or pilot studies. ("Exploratory research," n.d.) The results of exploratory research are not usually useful for decision-making by themselves, but they can provide significant insight into a given situation.

3. What market opportunities are there for this product?

Millions of homeowners, farmers, and small business owners all across America envision the day they can generate their own electricity from clean, sustainable renewable resources. People want the freedom of choosing how their electricity is produced, who produces it, and what environmental impacts their consumption generates. A full ninety one percent of Americans support "investments in new sources of energy, such as solar, wind, and fuel cells," according to a Gallup poll conducted November 27, 2001. ("Wind Turbine Industry," 2002, p. 3)
For many of these Americans, small wind turbine technology offers the best near-term hope of supplying products to fulfill that dream. The job before the U.S. small wind turbine industry, its partners, and its supporters is to deliver the products Americans want at a price they can afford. Since the early part of this decade, electricity prices have been rising. People are once again concerned about the security of energy supplies and the centralized generating facilities that rely on those sources of energy. Market opportunities are present because some people want independence from electric utilities. There is also a steadily increasing concern about global warming throughout the country and those individuals want an alternative to current methods of producing that energy for their homes and businesses that will have less impact on the environment. State governments, under utility restructuring, have enacted significant incentive programs that buy down the initial cost of small wind turbine systems, thereby tunneling through the cost barrier. The long-term industry vision is of a major new category of home energy appliance. In order to achieve 50,000 Megawatt (MW) the small wind turbine industry will have to grow to over $1 billion per year and employ over ten thousand people in manufacturing, sales, installation, and support. This is possible due to the sheer number of homes, which is numbered at fifteen million and small businesses, which are numbered at one million that could effectively use small wind systems if the economics were favorable. ("Wind Turbine Industry," 2002, p. 4) Recommendations: An opportunity that Urs should consider is that while many people will benefit indirectly from the clean air and economic growth brought about by wind power development, farmers will benefit directly. Wind power can provide an important economic boost to farmers. Large wind turbines typically use less than half an acre of land, including access roads, so farmers can continue to plant crops and graze livestock right up to the base of the turbines. ("Farming the Wind," 2012) Farmers and ranchers are in a unique position to benefit from the growth in the wind industry. To tap this market Urs need to help farmers understand that they can benefit by using the wind to generate power for their farms, or become wind power producers themselves. Farmers and ranchers can generate their own power from the wind, just as their predecessors did in the early twentieth century. Small wind generators, ranging from 400 watts to 40 kilowatts or more, can meet the needs of an entire farm or can be targeted to specific applications to benefit the farmer. Another benefit to farmers is called net metering. This enables farmers to get the most out of their wind turbines. When a turbine produces more power than the farm needs at that moment, the extra power flows back into the electricity system for others to use, turning the electric meter backwards. When the turbine produces less than the farm is using, the meter spins forward, as it normally does. At the end of the month or year, the farmer pays for the net consumption or the electric company pays for the net production. ("Farming the Wind," 2012) Urs must also point out the tax incentives that can be leveraged by farmers and small businesses that put in windmills to reduce energy costs. The American Recovery and Reinvestment Act signed by President Obama includes an uncapped 30 percent tax credit for the installation of small wind turbines. The stimulus package offers considerable financial incentives for renewable energy initiatives. Homeowners and businesses looking to save energy and reduce costs can now benefit from the uncapped 30% tax credit for the installation of small wind turbines. ("Wind power more viable for Americans," 2009)
References
Exploratory research. (n.d.). Retrieved from http://www.uoguelph.ca/htm/MJResearch/ResearchProcess/ExploratoryResearch.htm
Farming the wind; wind power and agriculture. (2012). Retrieved from http://www.ucsusa.org/clean_energy/technology_and_impacts/impacts/farming-the-wind-wind-power.html
Green building elements. (2009). Retrieved from http://greenbuildingelements.com/2009/02/19/newly-approved-uncapped-30-percent-tax-credit-for-small-wind-turbines-makes-wind-power-more-viable-for-americans/
Keller, K. L., & Kotler, P. (2009). A framework for marketing management (4th ed.). Upper Saddle River, New Jersey: Pearson Education.
Secondary research. (n.d.). Retrieved from http://www.marketresearchworld.net/index.php?option=com_content&task=view&id=81
The U.S. small wind turbine industry. (2002). Retrieved from http://www.awea.org/learnabout/smallwind/upload/us_turbine_roadmap.pdf
Types of market research. (2010). Retrieved from http://www.smallbusinessnotes.com/marketing-your-business/types-of-market-research.html