Introduction to Business Research

1-2

Business research is defined as the systematic and objective process of generating information for aid in making business decisions. - Including financial research, operational research, Marketing research

Business Research Defined

1-3

Business Research Research information is neither

intuitive nor haphazardly gathered. Literally, research (re-search)

-“search again” Business research must be

objective Detached and impersonal rather

than biased It facilitates the managerial

decision process for all aspects of a business.

Information

Reduces

Uncertainty

I don’t knowif we

shouldoffer on-sitechild care?

vddf 5

“It ain’t the things we don’t know that gets us in trouble. It’s the things we know that ain’t so.”

Artemus Ward

1-6

Basic research

Applied research

Business Research Types

1-7

Basic Research

Attempts to expand the limits of knowledge.

Not directly involved in the solution to a pragmatic problem.

1-8

Basic Research Example

Is executive success correlated with high need for achievement?

Are members of highly cohesive work groups more satisfied than members of less cohesive work groups?

Do consumers experience cognitive dissonance in low-involvement situations?

1-9

"The secret of success is to know something nobody else knows. "

Aristotle Onassis

1-10

Applied Research

Conducted when a decision must be made about a specific real-life problem

1-11

Applied Research Examples

Should McDonalds add Italian pasta dinners to its menu?

Business research told McDonald’s it should not?

Should Procter & Gamble add a high-priced home teeth bleaching kit to its product line?

Research showed Crest Whitestrips would sell well at a retail price of $44

1-12

Scientific Method

The analysis and interpretation of empirical evidence (facts from observation or experimentation) to confirm or disprove prior conceptions.

1-13

The Decision-making Process Associated with the Development and Implementation of a Strategy

Identifying problems and opportunities

Diagnosis and assessment Selecting and implementing a

course of action Evaluating the course of action

1-14

Evaluation Research

Evaluation research is the formal, objective measurement and appraisal of the extent to which a given activity, project, or program has achieved its objectives.

1-15Performance-monitoring Research

Research that regularly provides feedback for evaluation and control

Indicates things are or are not going as planned

Research may be required to explain why something “went wrong”

1-16Determining When to Conduct Business Research

Time constraints Availability of data Nature of the decision Benefits versus costs

1-17

Is sufficient time available before

a managerial decision

must be made?

Is the infor-mation already

on handinadequate for making

the decision?

Is the decision of considerable

strategicor tactical

importance?

Does the value of the research

informationexceed the cost of conducting

research?

ConductingBusinessResearch

Do Not Conduct Business Research

Time ConstraintsAvailability of

Data Nature of the DecisionBenefits vs. Costs

Yes YesYesYes

No No No No

Determining When to Conduct Business Research

1-18

Value versus Costs

Potential Value of a Business Research Effort Should Exceed Its Estimated Costs

1-19

Value

•Decreased certainty•Increased likelihood of a correct decision•Improved business performance and resulting higher profits

Costs•Research expenditures•Delay of business decision and possible disclosure of information to rivals•Possible erroneous research results

Value Should Exceed Estimated Costs

1-20Major Topics for Research in Business

General Business Conditions and Corporate Research

Financial and Accounting Research Management and Organizational

Behavior Research Sales and Marketing Research Information Systems Research Corporate Responsibility Research

1-21

Cross-functional Teams

Cross-functional teams are composed of individuals from various organizational departments such as engineering, production, finance, and marketing who share a common purpose.

1-22Business Research in the 21st Century

Increased globalization Growth of the Internet and

other information technologies

1-23

Global Research

Business Research is increasingly global

Market knowledge is essential A.C. Nielsen - more that 67%

international business

1-24

Global Business Research

General information about country - economic conditions and political climate

Cultural and consumer factors Market and competitive

conditions - demand estimation

1-25The Internet Is Transforming Society

Time is collapsing. Distance is no longer an

obstacle. Crossing oceans is only a

mouse click away. People are connected 24 hours

a day, seven days a week. "Instantaneous" has a new

meaning.

1-26

Internet Research

Seeking facts and figures about an issue

Surveys on Web sites

vddf 27

What is Marketing Research?

1-28

Redefining Marketing Research

The American Marketing Association (AMA) redefined Marketing Research as:

The function which links the consumer, the

customer, and public to the marketer

through INFORMATION

1-29

Used to identify and define market opportunities and problems

Generate, refine, and evaluate marketing performance

Monitor marketing performance

Improve understanding of marketing as a process

Redefining Marketing Research

1-30

Definition of Marketing Research

Marketing research is the systematic and objective

identification collection analysis dissemination and use of information

for the purpose of improving decision making related to the

identification and solution of problems and opportunities in

marketing.

1-31

Market Research

Specifies the information necessary to address these issues

Manages and implements the data collection process

Analyzes the results Communicates the findings and

their implications

1-32Classification of Marketing Research

Problem Identification Research Research undertaken to help identify problems

which are not necessarily apparent on the surface and yet exist or are likely to arise in the future. Examples: market potential, market share, image, market characteristics, sales analysis, forecasting, and trends research.

Problem Solving Research Research undertaken to help solve specific

marketing problems. Examples: segmentation, product, pricing, promotion, and distribution research.

1-33A Classification of Marketing Research

Marketing Research

Problem Identification Research

Problem Solving Research

Market Potential ResearchMarket Share ResearchMarket Characteristics ResearchSales Analysis ResearchForecasting ResearchBusiness Trends Research

Segmentation Research

Product Research

Promotion Research

Distribution Research

1-34

Problem Solving Research

Determine the basis of segmentation

Establish market potential and responsiveness for various segments

Select target markets

Create lifestyle profiles: demography, media, and product image characteristics

SEGMENTATION RESEARCH

Test concept

Determine optimal product design

Package tests

Product modification

Brand positioning and repositioning

Test marketing

Control score tests

PRODUCT RESEARCH

1-35

Problem Solving Research

PRICING RESEARCH

Pricing policies

Importance of price in brand selection

Product line pricing

Price elasticity of demand

Initiating and responding to price changes

$ALE

PROMOTIONAL RESEARCH

Optimal promotional budget

Sales promotion relationship

Optimal promotional mix

Copy decisions

Media decisions

Creative advertising testing

Evaluation of advertising effectiveness

Claim substantiation

0.00% APR

1-36

Problem Solving Research

DISTRIBUTION RESEARCH

Determine…

Types of distribution

Attitudes of channel members

Intensity of wholesale & resale coverage

Channel margins

Location of retail and wholesale outlets

1-37

Research Process

Step 1: Problem Definition

Step 2: Development of an Approach to the Problem

Step 3: Research Design Formulation

Step 4: Fieldwork or Data Collection

Step 5: Data Preparation and Analysis

Step 6: Report Preparation and Presentation

1-38

The Role of Marketing Research

ControllableMarketing

•Product

•Pricing

•Promotion

•Distribution

Variables

Marketing Research

MarketingDecisionMaking

ProvidingInformation

AssessingInformationNeeds

Marketing Managers

• Market Segmentation

• Performance & Control

• Target Market Selection• Marketing Programs

UncontrollableEnvironmentalFactors

•Economy

•Technology

•Laws & Regulations

•Social & Cultural Factors

•Political Factors

Customer Groups

• Employees• Shareholders

Suppliers•

• Consumers

1-39Marketing Research Suppliers & Services

LIMITED SERVICE

BrandedProducts

and Services

DataAnalysisServices

AnalyticalServices

Coding and Data Entry Services

Field Services

FULL SERVICE

SyndicateServices

StandardizedServices

Customized

Services

InternetServices

RESEARCHSUPPLIERS EXTERNALINTERNAL