Presentation on theme: "Market & Marketing Research"— Presentation transcript:
1Market & Marketing Research Dr. Vesselin BlagoevMBA’
2Lecture ObjectivesBy the end of the lecture, you should be able to:Define the differences between market and marketing researchUnderstand the role and use of MR information in marketingExplain the elements of a MIS and stages of the MR process
4Definitions of MR“Marketing Research is the function that links the consumer, customer, and public to the marketer through information... used to identify and define marketing opportunities and problems; generate, refine and evaluate marketing actions; monitor marketing performance; and improve understanding of marketing as process. Marketing research specifies the information required to address these issues, design the method for collecting information, manages and implements the data collection process, analyses the results, and communicates the findings and their implications.” (McDaniel, Jr. & Gates, 2010)
5Definitions of MRMarketing Research is: “the collection and analysis of data from a sample of individuals or organisations relating to their characteristics, behaviour, attitudes, opinions or possessions. It includes all forms of marketing and social research such as consumer and industrial surveys, psychological investigations, observational and panel studies” Market Research Society (1997) - UK
6Definitions of MR Chisnall (2005) “… there was originally a difference between the scope of activities [covered by market and marketing research]… The responsibilities of market research extend comprehensively, whereas marketing research is limited to findings out information about the market for a particular product.”but this narrow view restricts the focus for the purposes of marketing as a wider management function.MR should be: applied, scientific, pragmatic, objective, impersonal, factual
7MR definition summaryMarket Research aims to describe and analyse markets (size, structure, growth etc)Marketing Research covers a much broader range of topics - customers, products, competitors, channels, suppliers etc. Strictly speaking, Marketing Research is broader than Market Research
8Information“Most marketers don’t need more information, they need the right information and the managers need to be able to determine how to use this information appropriately and effectively so as to enhance performance.” Kotler, Wong, Saunders and Armstrong (2005); Similar point argued by McDaniel, Jr. & Gates (2010), Malhotra (2010) and Keegan and Green (2011)Do you agree with this? Why?
9Short cutMarketing research is the systematic and objective search for and analysis of information relevant to the identification and solution of any problem in the field of marketingArmstrong and Kotler (2011), Malhotra (2010)
10DefinitionSystematic: It is planned, following a sequence of logically ordered steps, starting with problem definition and ending with its use in problem solutionObjective: Data are collected using scientific methods and are analyzed using proven statistical processes
12Types of market Potential market Available market Consumers have some stated interest in a product or service.Available marketSet of consumers who have the interest, income and access to the product or services.Qualified available marketSet of consumers who have the interest, income, access and qualifications for a particular product or service.Served or ‘target’ marketPart of the qualified market that the company decides to pursue.Penetrated marketSet of consumers that have already bought a particular product or service.
13Measuring market demand The total market demand is the total volume of a product or service that would be bought by a defined consumer group in a defined geographic area, in a defined time period in a defined marketing environment under a defined level and mix of industry marketing effort.
14Measuring market demand Kotler, Wong, Saunders and Armstrong (2005)
15Types of demandThe primary demand is the total demand for all brands of product and services.The selective demand is a specific demand for a given brand of product.
16Estimating market demand Q= n x q x pWhereQ = total market demandn = number of buyers in the marketq = quantity purchased by an average buyer per yearp = price of an average unit
17Forecasting future demand Environmental forecastInflation, Unemployment, Interest rates, Consumer spending and saving, Business investment, Government expenditure.Industry forecastWhat is currently happening?Company sales forecastBuyers’ intentions, Composite of sales force opinions, Expert opinion.Test market method.Time series analysis, Leading indicators, Statistical demand analysis, Information analysis.
18Forecasting future demand Kotler, Wong, Saunders and Armstrong (2005)
19Sources of information Internal recordsMarketing intelligenceCompetitor intelligenceMarketing research
20MR Research Dimensions Continuous versus Ad hocOn-going researchOne-offQualitative versus QuantitativeWhy? (motivations, attitudes, behaviours)How many, how often?Secondary versus PrimaryData that already exists and was collected for another purposeData collected for the specific purpose at handQualitative research - the collection of data that are open to interpretation, e.g. peoples’ opinions.Quantitative research - the collection of data that is quantifiable and is not open to the same level of interpretation as qualitative research, e.g. sales figures, market share data, etc.
22Primary collection methods Primary data can be collected in 4 ways:observational researchfocus-group researchsurvey researchexperimental research2 main research instruments used are:questionnaires (open-end and closed-end)mechanical instrumentse.g. Eyetracking of screen use on internet/TVSometimes called field research.Is undertaken or commissioned by an organisation for a specific purpose.The required information does not already exist.It is exactly tailored to a problem.Can be expensive and time consuming.
23Marketing Research Step1 Defining the problem and research objectivesExploratory researchGathering preliminary information that will help to better define problems and suggest hypotheses.Descriptive researchDefining marketing problems, situations or markets, such as the market potential for a product or the demographics and attitudes of consumers.Causal researchMarketing research to test hypotheses about cause and effect relationships.
24Marketing Research Step 2 2. Developing the research plan for collection of informationDetermining information needsSecondary data: information that already exists, having been collected for another purpose.Primary data: information collected for the specific purpose at hand.Qualitative researchExploratory research used to uncover consumers’ motivations, attitudes and behaviour.Quantitative researchResearch data which involves interviews from a sufficient volume of customers to allow statistical analysis.
25Marketing Research Step 3 3. Presenting the research planOutline of research construct.Summarised written proposal.
26Marketing Research Step 4 4. Implementing the research plan, collecting and analysing the dataInterpreting and reporting the findings.Present the relevant data so that the information can be used to make meaningful decisions.Team effort between marketers and researchers and joint responsibility.
30Demand estimationEstimation of market demand is essential for effective marketing and as illustrated below, demand is measured on a number of levels.Figure 9.3 Ninety types of demand measurement (6 5 3)
31Secondary SourcesInternal sales records, databases, customer feedback, experienced employeesGovernment reportsChambers of Commerceoften available on gov.uk websiteTrade AssociationsIndustry Reports & Country-based reportse.g. GMID/Euromonitor (available viaMarketing area specific articles/reportse.g. PromotionsSometimes referred to as desk research.Consists of data and information that is already in existence and which can be accessed by the organisation.Can be cheaper and quicker to access than primary research.May provide an organisation with information that it would not otherwise have time to gather.Secondary data may not always be up to date, be applicable to an organisation, or give the full picture.
32MR: key criterionMR information has the purpose of supporting marketing decisionsOrganisations as they grow in size tend to lose close customer contactNew markets entered may be geographically distant and unfamiliarNew products require research into their potential appeal to customersCommunications need researching - are the right messages being given and receivedNeed to think clearly about the issue to be decided, before spending money on MR
33Marketing Research in practice Marketing research is concerned with investigating and understanding buyer behaviourBuying behaviour is merely one element of human behaviour; it is complex and influenced by many factorsMotivations may be a mixture of business specific, personal, economic, psychological, sociological and demographic variablesBehavioural sciences give insights into consumption
34Marketing research in small businesses and non-profit organisations Often limited by budgetary constraints, but the following can be accomplished:Observation of market, competitors and industrySecondary data collectionSurveysExperiments
35Main divisions of MRProductCustomerPricingSalesPromotion
36Overview of MR divisions TypeProductCustomerPricingSalesPromotionExamples of issues needing investigation through MRFailure, reduced demand, portfolio inequity, lack of USP, poor qualityTarget segment profile, preference, loyalty, Macro/Micro env. issues, habits, motivationSensitivity, ceiling, match to other mix elements, competition, incentives needed, vs. perception of quality,Increasing cost of sales, comparative mkt performance, falling sales, force organisation, distribution methodsRelevant methods to audience, rising costs, reduced exposure/coverage, effectiveness, integration,Types of info.Demand, sales, market share, competitive advantageDemographics, purchase behaviours, level of influence of int./ext. factorsCosts, profit objectives, mkt/competitive prices, trade /channel vs. consumer pricesValue, volume, quantity sold, mkt coverage, latent potential, buyer powerMedia usage / availability, readership/ viewer rates, public image, awareness, perceptual positioning, brand strength
37Why MR is importantEffective penetration of markets requires specialised and sophisticated approaches to identify, assess and satisfy market demands.Effective marketing information and research enables an organisation to make better decisions on the most appropriate market entry and competitive strategies.Traditionally, small firms have close links with their customersLarge-scale operations have widened the gap between producers and consumersModern communities are knowledgeable, experienced and critical
38Marketing information system (MIS) The marketing information system (MIS) is comprised of:peopletechnologyproceduresto gather, sort, analyse, evaluate and distribute necessary, timely and accurate information to marketing decision makers.
39Marketing Information System (MIS) Effective system of organising, structuring and managing the storage, access and dissemination of market research dataBrassington & Pettitt, 2007
40The Marketing Research Process Brassington & Pettitt, 2007
42MR in the Marketing Process MR information needed at all stages:new product idea generation and product developmentmarketing testinglaunch implementationbrand performance managementpositioning and repositioning etc
43Market research ethics Increasing consumer resentment has become a major problem in the research industry due to how the market research has been used and abused.Consumers fear researchers may use sophisticated techniques to obtain information that may be intrusive and infringe consumer rights.There is also the fear that the research findings may be manipulated and misinterpreted to suit the company paying for the research.To minimise abuse the research industry has developed broad standards such as ESOMAR’s International Code of Marketing and Social Research Practice.
44SummaryMarketing research aids decision making by providing management with specific kinds of information which should form the foundation of all strategic decision making and tactical planningMarketing Research is vital in identifying, anticipating and satisfying customer needs profitablyAccurate information enables intelligent decision making in pursuit of organisational objectivesInformation must be continuously collected, monitored, analysed and communicated all around the organisation (via a MIS)All businesses can conduct research, whether in-house or via an external consultancy
45Further reading suggestions Armstrong, G. and Kotler, P. (2011), Marketing, 9th ed., PearsonCooper, D. & Schindler, P. (2006), Marketing research. Boston: McGraw HillKeegan, W.J.& Green, M. (2011), Global Marketing, 6th ed., PearsonKotler, P. & Armstrong, G. (2010), Principles of Marketing, 13rd ed., PearsonMalhotra, N. (2010), Marketing Research. An Applied Orientation, 6th ed. PearsonMcDaniel, Jr. C. and Gates, R. (2010), Marketing Research, John Wiley & Sons, 8th ed.