marketing research. “ the process of planning and executing the conception, pricing, promotion,...
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MARKETING RESEARCH
“ The 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.”
McDaniel & Gates
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
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 a return on investment by reducing the possibility of failure and enhancing the success of marketing strategies and decision-making. In a word it reduces risk.
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• Ethnography, observational studies
Quantitative
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?
• Marketing Research
• Customer Databases
• Internal Reporting Systems/ Scanner Data
• The Internet / On-line Sources
What are the Major Sources of Information?
Types Of Research
• Exploratory
• Descriptive
• Causal
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 than qualitative
• Tests hypotheses and provides conclusive information
• more rigid than exploratory research
Causal Research• Conducted to identify cause and effect
relationships, especially to see how actions now will affect a business in the future
• accomplishes goal through laboratory and field experiments
• For example, if Kellogg’s wants to know what impact on sales a change in package design would have.
• Stores are matched in terms of demographics, location etc. with only the packaging changed.
• Following the research, marketing managers will be able to decide whether changing the package design would be profitable.
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
Do we really need research? Expensive. Valuable? Benefits versus costs
Nature of the decision Vital?
When should we NOT conduct research: No time or money Insufficient payback Information already available Information too hard to get
Determining When to Conduct Marketing 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 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 changed little since the last major design change in 1992. 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?
19922009
The Marketing Research Process
1. Problem identification
2. specifying what information is required – define research objectives (hypothesis driven)
3. designing the method for collecting information (, exploratory, survey, observation, secondary, experiment)
4. Select sample
5. managing and implementing the collection of data
6. Preparing, analyzing and interpreting the data
7. communicating the findings and their implications.
What is the purpose of the study?What is the relevant background information?Problem definition involves discussion with the decision makers, analysis of secondary data, perhaps, some exploratory researchOnce the problem has been precisely defined, the research can be designed and conducted properlyA decline in sales is a problem, but its underlying cause is what must be correctedTo define the problem, list every factor that may have influenced it, then eliminate any that cannot be measured
1. Define the problem or opportunity
2. specifying what information is required
Ascertain the decision maker’s
objectives
Understand background of the problem
Isolate/identify the problem,
not the symptoms
Determine unit of analysis
Determine relevant variables
State research questions and
objectives
Exploratory: ◦ Initial, unstructured, informal
◦ When you don’t know much
◦ Focus groups, lit review, case study, pilot study, secondary
data, experience survey
Descriptive:◦ Answers who, what, why and how
◦ Surveys, observation
Causal:◦ Relationships between variables
◦ Experiments
3. Determine Research Design
Subjects
◦ Census = all
◦ Sample = portion
Identify target population
◦ Cost vs. generalizability
Identify unit of analysis
◦ Individual, household, community
How will you select subjects?
◦ Probability vs. nonprobability
4. Select Sample
Determine data gathering methods
◦ Secondary data:
Internal records, reports for purchase, library, web
◦ Primary data:
Telephone, web, in person, mail, observation (in person,
electronic)
Properly prepare
◦ Pretest, pilot test, main study
5. Collect Data
• Edit data
• Code data
• Select appropriate analysis method
• Use to summarize findings
• Use to interpret results
– Will the findings hold for the general population?
6. Analyze Data
• SUMMARY:
• What was done and what was found
• Goal: clear, unbiased conclusions
• Write for your audience
7. Prepare Report
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 the Cadillac Escalade?
Would it matter if you 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
it only works if you ask the right questions and
it only works if you analyze the data in the right way.
But…..
Research EthicsThe moral principals and values that govern actions and decisions. They are guidelines on how to act when faced with moral dilemmas.
No harmConfidential or Anonymous?
Full disclosureBefore and after (debriefing)
No deception (passive or active)
No coercionRight of refusal
Identity protectionAnonymity or confidentiality
“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