MARKETING RESEARCH

A process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods and services to create exchanges that satisfy individual and organizational objectives.

Marketing

What is Research?

Investigation or experimentation aimed at the discovery and interpretation of facts

The planning, collection, and analysis of data relevant to marketing decision making and the communication of the results of this analysis to management

McDaniel and Gates 2006

What is Marketing Research?

What functions should be performed to successfully market this product?

What are all the potential research activities needed to support each of these marketing functions?

Why Should Organizations Spend

Money on Market Research?

“TO GUESS IS CHEAP, TO GUESS WRONGLY IS EXPENSIVE”

Marketing research is an investment that produces great returns by reducing the possibility of failure and enhancing the success of marketing strategies and decision-making

Chinese proverb

How does research achieve reduction in risk?

Why should research be hypothesis driven?

Indigo books has noticed that many customers abandon the shopping process part way through.

What might be the reasons for this?

Product

Price

Promotion

Place

What sort of decisions does management face that require

information (i.e. Marketing research)

A

R

T

ccurate

elevant

imely

What Qualities of the data will be relevant to marketing decision making?

• “How many people like your product?”• Predictive if done correctly• Surveys: Telephone, Mail, Intercept, Internet

What are the Two main types of information?

Qualitative

• “How do people feel about the your product?”• Not predictive of market behavior• Qualify needs, wants, preferences• Focus Groups, In-depth interviews

Quantitative

• Marketing Research

• Customer Databases

• Internal Reporting Systems/ Scanner Data

• The Internet / On-line Sources

What are the Major Sources of Information?

– Secondary Research• Existing studies, census data, articles• Internet, library, trade journals• Non-specific and often dated

– Primary Research• data originated specifically for the study at hand • Create your own questions and find your own

answers by asking people what they think, feel, know, etc.

• Common methods include: – Focus groups, surveys

What are Two main sources of information?

Types Of Research

• Exploratory

• Descriptive

• Causal

Exploratory Research(Unaware of Problem)

“Our sales are declining and we don’t know why.”

“Would people be interested in our new product idea?”

Descriptive Research(Aware of Problem)

“What kind of people are buying our product?

Who buys our competitor’s product?”

“What features do buyers prefer in our product?”

Causal Research(Problem Clearly Defined)

“Will buyers purchase more ofour products in a new package?

“Which of two advertising campaigns is more effective?”

Uncertainty Influences The Type Of Research

COMPLETELY CERTAINABSOLUTE AMBIGUITYCAUSAL ORDESCRIPTIVEEXPLORATORY

Exploratory Research

• Initial research conducted to clarify and define the nature of a problem

• Does not provide conclusive evidence

• Helps develop hypotheses but does not test them

• Subsequent research expected

• Published sources, depth interviews, focus groups

• characterized by its flexibility

Descriptive Research

• Describes characteristics of a population or phenomenon (who, what, where, when, why, and how)

• Some understanding of the nature of the problem

• Tends to be more quantitative then qualitative

• Tests hypotheses and provides conclusive information

• more rigid than exploratory research

Causal Research

• Conducted to identify cause and effect relationships

• accomplishes goal through laboratory and field experiments

Determining When to Conduct Marketing Research

• Time constraints

• Availability of data

• Nature of the decision

• Benefits versus costs

When would you not want to conduct Market Research?

The Bank of Montreal has been trying to sell its services online but finds that new web users are not signing up for services. Management wonders whether or not they should we invest in a guided tour?

Should they conduct market research to help them decide?

A guided tour involves a considerable financial risk. There are also concerns about brand image. So they decide to proceed with the research. What do they need to know?

What are some hypotheses as to why users are not signing up?

How might they discover which, if any, of these possible reasons is correct?

Assume they discover that the reason was a poor portrayal of the value proposition, I.e.people did not understand why they should use the service. What would be the next step?

Anecdotal evidence suggests that although customers like the performance and comfort of the Ford Crown Victoria, they are not overly enthusiastic about it’s design which has not changed for over 13 years. Ford has decided to hire an external market research company (i.e. you) to find out how the public are likely to feel about a new design. What steps would you take to provide this information?

The Marketing Research Process

• Problem identification• specifying what information is required • designing the method for collecting information• managing and implementing the collection of

data• Preparing, analyzing and interpreting the data • communicating the findings and their

implications.

The Marketing Research Process

Problem Discovery

Exploratory Research

Selection of the Basic Research Method

Selection of Sample Design

Collection of the Data

The Research Process (cont.)

Editing and Coding

Data Processing

Interpretation of the Findings

Report

Would you talk only to current owners?

Would you talk to only 10 people?

Would it matter if you asked them about Ford Escalade?

Would it matter if did a multiple regression analysis?

Would you talk only to men?

Marketing research works because, by talking to a relatively small number of people, it is possible to find out about a far larger number.

it only works if you talk to the right number of people,

it only works if you talk to the right type of people and

it only works if you ask the right questions

and analyze the data you get in the right way.

But…..

“The formulation of the problem is often more essential than its

solution”

• Albert Einstein

The Management Problem versusThe Management Problem versusthe Marketing Research Problemthe Marketing Research Problem

A distinction must be made between the management problem and the marketing research problem.

Management ProblemManagement Problem Marketing ResearchMarketing ResearchProblemsProblems

• Focus on symptoms

• Action oriented• Focus on causes

• Data oriented