Marketing Research: Gather, Analyze, and Use Information Chapter 4 Marketing Research: Gather, Analyze, and Use Information

Chapter Objectives Explain the role of the marketing information system and the marketing decision support system in marketing decision making Understand data mining and how marketers can put it to good use List and explain the steps and key elements of the marketing research process Appreciate the importance of high ethical standards in marketing research Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Real People, Real Choices: Decision Time at Plan-It Marketing What marketing research strategy would maximize results of the research within a reasonable budget? Option 1: conduct exploratory qualitative study Option 2: conduct quantitative survey of 700+ leisure and business travelers Option 3: conduct viability study with both qualitative exploratory study and confirmatory quantitative study Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Knowledge Is Power Accurate, up-to-date, relevant information is the fuel that runs the marketing engine Marketing information systems: Determine what information marketing managers need, then gathers, sorts, analyzes, stores, and distributes information to system users Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Marketing Information Systems Marketing information systems (MIS) include multiple components: Data: Internal company data Marketing intelligence Marketing research Acquired database Computer hardware and software Information for marketing decisions Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Internal Company Data Internal data: Information from within the company to produce reports on the results of sales and marketing activities Intranet: Internal corporate communications network that links company departments, employees, and databases Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Marketing Intelligence Marketing intelligence systems: Method by which marketers get information about everyday happenings in the marketing environment Example: Monitoring the Internet and using “mystery shoppers” Futurists specialize in predicting consumer trends Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Marketing Research Market research: Collecting, analyzing, and interpreting data about customers, competitors, and the business environment to improve marketing effectiveness Syndicated research Custom research Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Acquired Databases External databases can be used to collect a variety of information from different sources Non-competing businesses Government databases Misuse of databases can be problematic and has led to do-not-call lists and antispam laws Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Marketing Decision Support Systems Marketing decision support systems: Data plus analysis and interactive software that allow managers to conduct analyses and find the information that they need Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Searching for Gold: Data Mining Data mining: Includes sophisticated analysis techniques to take advantage of the massive amount of transaction information now available Analysts sift through data to identify unique patterns of behavior among different customer groups for use in behavioral targeting Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

What Marketers Can Do with Data Mining Data mining applications in marketing: Customer acquisition Customer retention and loyalty Customer abandonment Market basket analysis Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Steps in the Marketing Research Process Step 1: Define the research problem Specifying research objectives Identifying consumer population of interest Placing the problem in an environmental context Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Steps in the Marketing Research Process Step 2: Determine the research design Determine whether secondary data are available Determine whether primary data are required and if so, what type: Exploratory research Descriptive research Causal research Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Secondary and Primary Research Secondary data: Have been collected for some purposes other than the problem at hand Primary data: Information collected directly from respondents to specifically address the question at hand Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Exploratory (Qualitative) Research Exploratory research techniques generate insights for future, more rigorous studies Typically involve in-depth consumer probing Take many forms: Consumer interviews Focus groups Productive techniques Case studies Ethnography Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Descriptive (Quantitative) Research Descriptive research studies: Probe systematically into the problem Base conclusions on large numbers of observations Typically expresses results in quantitative terms (averages, percentages, other stats) Cross-sectional design Longitudinal design Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Causal Research Cause-and-effect relationships: A change in one thing causes a change in something else Independent (cause) vs. dependent (change in outcome) variables Experiments test predicted relationships among variables in a controlled environment Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Steps in the Marketing Research Process Step 3: Choose the method for collecting primary data Survey methods are used to interview respondents Questionnaires: loosely, moderately, or completely structured Observational research methods Online research Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Questionnaires Mail questionnaires Telephone interviews Face-to-face interviews Mall intercept Online questionnaires Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Observational Methods Observation: Data collection method where the researcher records consumers’ behaviors, often without their knowledge Personal observation Mechanical observation Unobtrusive measures Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Online Research Types of online research: Gathering information via consumer surfing Gathering information via Web site/ e-mail/chat room questionnaires/focus groups Online research used as part of: New-product development Estimating market response Exploratory research IM and focus groups Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Data Quality: Garbage In, Garbage Out How much faith should marketing managers place in research? Three key considerations include: Validity Reliability Representativeness Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Step 4: Design the Sample Probability sampling: Each member of the population has some known chance of being included Sample is representative of population, and inferences about population are justified Types of probability sampling: Simple random sampling Systematic sampling Stratified sampling Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Step 4: Design the Sample Nonprobability sample Personal judgment used in selecting respondents Some members of population have no chance of being included so sample is not representative of population Types of nonprobability sampling Convenience sampling Quota sampling Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Step 5: Collect the Data Challenges to gathering data in foreign countries include: Differences in sophistication of research operations Infrastructure/transportation challenges Lack of phones and/or low literacy rates Local customs and cultural differences Language translation difficulties Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Step 6: Analyze and Interpret the Data Data must be analyzed and interpreted to be meaningful Tabulation: Arranging data in a table or other summary form to get a broad picture of overall responses Cross-tabulation: Examining the data by subgroups to see how results vary between categories Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Step 7: Prepare the Research Report Research reports typically contain the following sections: Executive summary Description of research methodology Discussion of results including tabulations, cross-tabulations Limitations of study Conclusions and recommendations Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Ethics in Marketing Research Marketing research ethics: Taking an ethical and above-board approach to conducting marketing research that does no harm to the participant in the process of conducting the research Researchers must provide full disclosure of confidentiality and anonymity options Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Real People, Real Choices: Decision Made at Plan-It Marketing Cindy chose option 3, conducting both qualitative and quantitative research Implementation: Concept design was refined using input from qualitative research; quantitative study of 700 business and leisure travelers confirmed viability of Priceline’s business model concept Measuring success: Used total unduplicated reach and frequency analysis Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Keeping It Real: Fast-Forward to Next Class Decision Time at (RED) Meet Julie Cordua, VP Marketing—(RED) (RED) works with international brands to make unique products and directs up to 50% of gross profits to the Global Fund The decision to be made: Is partnering with mass market international brands the optimal way to generate money for the Global Fund? Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher. Printed in the United States of America. Copyright © 2009 Pearson Education, Inc.   Publishing as Prentice Hall Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall