Marketing Research Systems Chapter 5 Unlocking the secrets of your market segments…

2 The Marketing Information System  People –Financiers, researchers, input clerks, statisticians, survey respondents  Equipment –Telephones, computers, forms, pencils, etc.  Procedures –Define who, how, when, where,  Gather, sort, analyze, distribute  Results should be needed, timely, accurate

3 Assessing Information Needs  Necessary vs. Desirable –Easy to collect too much data –Consider cost and benefit of gathering data Secondary data: existing, collected for some other purpose Primary data: brand new, collected just for this question  Internal sources –Sales data, inventory, costs, customer service  External sources –Competition –Social Trends –Demographics

4 Internal Sources of Information  Secondary data –Financial statements (SBU & Corporate) Sales, costs, cash flows –Sales records, trends Restaurant covers, average checks, item counts Occupancy patterns, no-shows, cancels, ADR –Guest history Demographics, # of visits, # in party, special requests  Primary data –Secret shoppers –Guest comment cards –Automated systems like in room TV surveys –POS / casino-tracking systems

5 Marketing Intelligence  Internal –Executives –Front-desk staff –Purchasing agents –Sales staff  External –Suppliers –Marketing intermediaries –Competitors’ public disclosures –Mailing lists –Associations

6 Marketing Research  Should identify opportunities, threats –SWOT?  Segmentation demographics  Concept development & product testing  Price-sensitivity Assessment  Advertising & Promotion Assessment  Market tracking  Customer satisfaction

7 The Research Process 1. Define the research problem & objectives 2. Develop the research plan 3. Implement the research plan 4. Interpret and distribute results

8 Defining the Problem & Objectives  Is there a problem? –Symptoms –5 Whys  If “No”, maybe better to leave things alone  If “Yes”, how do we fix it?  Problem-solving approach –Exploratory Gather information about… –Descriptive It’s like… –Causal “A” causes “B” to happen The Universe ?

9 Quantitative Research  Experimental Research –Used to find out about likely reactions to new services, products –Concept Testing –Test marketing  Observational Research –Mechanical – machines watch people behave counters, cameras, bar-codes, etc… –Human – people watch other people behave Beware observer bias, Hawthorne Effect  Simulation –Mathematical models used to predict sales

10 Survey Research  Most common method of data collection  People often do not participate –Surveys are considered an intrusion in their life  Personal interviews  Mail Surveys  Telephone Surveys  In-house, self administered

11 Response Rate  Critical to success of survey  Higher % is best, but rates of 40-50% (or less) are common  Improving response rate –Personal interviews – can explain, probe, interpret body language –Mail – repeat mailings, follow-up, S.A.S.E., color, presentation, size, simple ?’s –Telephone – timing is critical, call back, voice

12 Personal Interviews  One-on-one, high response rate  Can explain difficult questions & probe vague answers  Time consuming  Beware interviewer bias, cultural differences  Reluctance to answer sensitive questions  Must guarantee anonymity  May be difficult to quantify answers  Changing responses - “so are you saying….?”  Personal hygiene critical

13 Mail Surveys  Relatively inexpensive  Very little bias  Consistent answers, easy to quantify  Can cover large # of respondents  Anonymity pretty much assured  May be treated as junk mail by recipient  May not answer all items  Cannot explain difficult concepts, ?s  Lag time from mailing to receipt

14 Telephone Surveys  Similar to personal interviews but respondents remain anonymous  Can cover many respondents – speed dial, auto call-back, etc…  Respondents unlikely to hang up  Immediate feedback  Considered intrusive

15 Questionnaire Design  Address ?s to the respondent’s level  Simple questions  No “double-barreled” ?s  Use plain English  Not too many ?s  Appropriate response categories / no overlap  Don’t know / no opinion  Personal ?s last  Many, many more

16 Qualitative Research  Focus Groups –Group discussion about pros & cons of product / service –Moderator / facilitator required –Provide in-depth information from consumers  Individual depth interview –Similar to focus group, but one-on-one  Case studies – Review actual company situations –Generally don’t have a single solution