1 Marketing Research: Methodological Foundations, 9e By Churchill and Iacobucci © 2005 Thomson/South-Western

2 Chapter 1 Marketing Research: It’s Everywhere!

3 target market product price place promotion Figure 1: The Task of Marketing Management

4 CompetitiveEnvironment TechnologicalEnvironment NaturalEnvironment SocialEnvironment Political and Legal Environment EconomicEnvironment Figure 2: The Environments That Affect Marketing Marketing Strategy Customer Value and Behavior

5 Definition of Marketing Research Marketing research is the “function which links the consumer, customer, and public to the marketer through information--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 a process.”

6 Figure 3: Where the Marketing Research Dollars are Concentrated Source: Inside Research, “Where the Money Is,” American Demographics (

7 Research Activities of 435 Companies Percent Doing A. Business Economic and Corporate Research 1. Industry/market characteristics and trends 2. Acquisition/diversification studies 3. Market share analyses 4. Internal employee studies (morale, communication, etc.) 92% B. Pricing 1. Cost analysis 2. Price analysis 3. Price elasticity 4. Demand analysis: a) market potential b) sales potential c) sales forecasts 5. Competitive pricing analyses C. Product 1. Concept development and testing 2. Brand name generation and testing 3. Test market 4. Product testing of existing products 5. Packaging design studies 6. Competitive product studies

8 Research Activities of 435 Companies (continued) Percent Doing D. Distribution 1. Plant/warehouse location studies 2. Channel performance studies 3. Channel coverage studies 4. Expert and international studies 25% E. Promotion 1. Motivation research 2. Media research 3. Copy research 4. Advertising effectiveness testing a) prior to marketplace airing b) during marketplace airing 5. Competitive advertising studies 6. Public image studies 7. Sales force compensation studies 8. Sales force quota studies 9. Sales force territory structure 10. Studies of premiums, coupons, deals, etc F. Buying Behavior 1. Brand preference 2. Brand attitudes 3. Product satisfaction 4. Purchase behavior 5. Purchase intentions 6. Brand awareness 7. Segmentation studies

9 Could Marketing Research Be Used to Investigate the Following? If Yes, How? *What is our product’s per unit profit margin? *Can the Internet be used as an efficient distribution channel for our products? *Which brand name projects the image we want for our product? *How many suppliers should we purchase from? *What kinds of firms use our services? *What is the lifetime value of our target customer segments? *What is the most effective trade promotion program? *What is our reputation with government regulatory agencies? Yes/No

10 How Might Each of These Institutions Use Marketing Research? *An outdoor advertising firm *A local bank *A dairy farm *The Los Angeles Lakers *A nature conservation group *A manufacturer of large-screen TVs, operating in Mexico City *The Food and Drug Administration

11 Marketing Research, E-Commerce, and the Internet Research ON the Internet: These studies use the Internet or other high tech means to study any consumer or market behavior. The Internet becomes another modality for communicating with customers, like paper-pencil surveys, phone interviews, etc. Research ABOUT the Internet: These studies focus on e-commerce or consumer and market behavior on the Internet as an end in itself. They often also use the Internet as a means of collecting data, e.g., through contacts, Web-based surveys, or surreptitious observation and measurement of Web page visitations. Full Service, Established Firms: extending their menu of services to include the Internet (e.g., A.C. Nielsen, The NPD Group, Information Resources Inc.) Electronic Marketing Research Companies: Electronic Marketing Research: Internet Specialists: Newer marketing research firms concentrating on the Internet (e.g., Media Metrix, I-tracks, eMarketer, Jupiter Communications)

12 Figure 4: Reports of Last Year, and Projection of Next Year’s, Use of Traditional and Online Marketing Research Projects Source: Thomas Miller (2001) “Studies of Information, Research, and Consulting Services,”

13 Figure 5: Who’s Conducting Marketing Research?

14 Figure 5, continued

15 Figure 5, continued

16 Figure 5, continued Source: “Marketing Fact Book,” Marketing News (July 7, 2003).

17 RESEARCH REALITIES 2: TOP 20 GLOBAL RESEARCH ORGANIZATIONS Source: Honomichl Top 50 Annual Business Report on the Marketing Research Industry, Marketing News (June 9, 2003), Chicago: American Marketing Association.

18 Marketing Research Job Titles and Responsibilities Research Director/Vice President of Marketing Research: This is the senior position in research. The Director is responsible for the entire research program of the company. Accepts assignments from superiors or from clients, or may, on own initiative, develop and propose research undertakings to company executives. Employs personnel and exercises general supervision of the research department. Presents research findings to clients or to company executives. Assistant Director of Research: This position usually represents a defined “second in command,” a senior staff member having responsibilities above those of other staff members. Statistician/Data Processing Specialist: Duties are usually those of an expert consultant on the theory and application of statistical techniques to specific research problems. Usually responsible for experimental design and data processing. Analytically Skilled Methodologists: Directors and Managers: Qualitative Specialist: Some firms have a person specifically assigned to oversee interview techniques and focus groups.

19 Marketing Research Job Titles and Responsibilities (continued) Senior Analyst: Usually found in larger research departments. Participates with superior in initial planning of research projects and direct execution of projects assigned. Operates with minimum supervision. Prepares, or works with analysts in preparing, questionnaires. Selects research techniques, makes analyses, and writes final report. Budgetary control over projects and primary responsibility for meeting time schedules rest with the Senior Analyst. Analyst: The Analyst usually handles the bulk of the work required for the execution of research projects. Often works under a Senior Analyst. The Analyst assists in questionnaire preparation, pre-tests them, and makes preliminary analyses of results. Most of the library research or work with company data is handled by the Analyst. Analysts: Junior Analyst: Working under rather close supervision, Junior Analysts handle routine assignments. Editing and coding of questionnaires, statistical calculations above the clerical level, simpler forms of library research are among their duties. A large portion of the Junior Analyst’s time is spent on tasks assigned by superiors.

20 Librarian: The Librarian builds and maintains a library of reference sources adequate to the needs of the research department. Clerical Supervisor: In larger departments, the central handling and processing of statistical data are the responsibility of one or more Clerical Supervisors. Duties include work scheduling, and responsibility for accuracy. Field Work Director: Usually only larger departments have a Field Work Director who hires, trains, and supervises field interviewers. Full-time Interviewer: The Interviewer conducts personal interviews and works under direct supervision of the Field Work Director. Few companies employ full-time interviewers. Tabulating & Clerical Help: The routine, day-to-day work of the department is performed by these individuals. Marketing Research Job Titles and Responsibilities (Continued) Support Staff: Data Collection:

21 Necessary Skills for an Entry or Junior Level Marketing Research Position Technical Skills * Computer Literacy * Sample Design * Statistical Analysis * Numerical Skills Managerial Skills * Oral Presentation * Written Communications * People Relations * Project Coordination