Research Methods in Marketing (MBA 8601) Jeremy Kees, Ph.D.

My Research… Advertising –Kees et. al (Journal of Advertising, forthcoming) –Kees, Jeremy (JCIRA, forthcoming) Framing Effects Pharma – “Fair Balance” –Kees et al. (Psychology and Marketing, 2008) Nutrition –Burton et al. (American Journal of Public Health, 2006) Menu Labeling

My Research… Smoking/Tobacco –Kees et al. (Journal of Public Policy and Marketing, 2006) Graphic Warning Labels Pricing –Jensen et. al (Journal of Interactive Marketing, 2003) Reference Prices Finance –Howlett et al. (Journal of Consumer Affairs, 2008) Temporal Orientation and Long-Term Financial Planning

The Value of Marketing Research Reduces risk in decision making Let’s move away from making decisions based on anecdotal evidence (i.e., information or casual observation that is not based on facts or careful study)

Important Topics… Part I: Non-data research issues –Research Process –Problem Identification –Study Design –Sampling Part II: Data Analysis –Crosstabs / Correlation –Regression / t-tests / ANOVA –Conjoint / Perceptual Mapping

How does research fit into the broader scope of marketing management??

Review of Marketing Management product price place promotion target market

The External Environment CompetitiveEnvironment TechnologicalEnvironment NaturalEnvironment SocialEnvironment Political and Legal Environment EconomicEnvironment Marketing Strategy Customer Value and Behavior

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.” - American Marketing Association

10  Marketing research is the systematic and objective  identification  collection  analysis  dissemination  and use of information  For the purpose of improving decision making related to the  identification of problems and opportunities and  solution of problems and opportunities in marketing. Marketing Research Defined

11 Used to identify and define market opportunities and problems Generate, refine, and evaluate marketing performance Monitor marketing performance Improve understanding of marketing as a process Using Information….

The need for information… MR focuses on the use of information as a source of strategic advantage As marketers, we should strive for a thorough knowledge of customers, and their attitudes, tastes, preferences We should also want to keep an eye on competition (e.g., benchmarking) This information will help us making strategic marketing decisions (e.g., 4 P’s)

To sum….the function of marketing research is to provide managers with information

14 Marketing Research Problem /Opportunity Identification Research Problem-Solving Research Market Potential Research Market Share Research Market Characteristics Research Sales Analysis Research Forecasting Research Business Trends Research Segmentation Research Product Research Pricing Research Promotion Research Distribution Research

Users of Market Research Fortune-500 Firms –e.g., Product tweeks, shelf location Entrepreneurs –e.g., Market size, growth potential, viability And everyone in-between…

Marketing research can tell us… How our customer service is perceived by our customers and what particular areas we can improve on or emphasize How customers shop and how we can adjust our atmospherics to maximize sales What new products or new product features do customers want How customers perceive us in relation to our key competitor (or do they even recognize us as a key player in the industry) Who our most loyal customers are and how do we cater to this important segment Who our prototypical customer is How can we segment the market in more manageable groups What marketing communications are most effective at reaching various segments of the market What is going to be the demand for a new product or an existing product in a new market Where should we build our next retail location At what price point we can maximize profitability and maintain consumer demand Which media vehicles will be most effective to communicate our advertising message Etc.

Project vs. Info Systems Information Systems Approach (MIS—Marketing Information System) –“Ongoing” decision tool –Interactive / Non-technical models –Database Marketing –e.g., Retail Link Project-Based (the focus of this discussion)

Research $$ are spent on…

19 *An outdoor advertising firm *A local bank *The Los Angeles Lakers *The Food and Drug Administration How Might Each of These Institutions Use Marketing Research?

The Research Process

Just to reemphasize… Marketing research is the marketer’s link to understanding the consumer and the external environment The SOLE purpose of marketing research is to inform decisions Every research project is different...

Step 1: Problem Formulation A well-defined study begins with a clearly defined objective “The formulation of a problem is often more essential than its solution”- Albert Einstein The problem is rarely clear-cut Slight variations in research questions can lead to substantial changes in the research process (so be careful) –Drives decisions related to research design, measurement, sampling, analysis, etc.

Step 1: Problem Formulation Stage in the Process Typical Questions Formulate problem What is the purpose of the study (i.e., to solve a problem? Identify an opportunity?) Is additional background information necessary? What are specific research questions and what information is needed to make the decision? How will the information be utilized? Has a decision already been made? Should research be conducted?

“Attacking the Obesity Epidemic: An Examination of the Potential Health Benefits of Nutrition Information Provision in Restaurants,” American Journal for Public Health (2006) Formulate Problem –Obesity is the 2 nd leading cause of preventable death in the US –What can be done? –Can the provision of nutrition information help consumers make better (healthier) food consumption decisions? (decision problem) –How good (accurate) are consumers at estimating the nutritional content of restaurant foods? and Can providing objective nutrient information improve food evaluation and choice (research problems) –State hypotheses to be tested based on theory Based on Expectancy disconfirmation theory: –H3a: When objective nutrition information is less favorable than consumers’ expect, nutrition information provision will have a greater negative influence on product attitudes and purchase intentions and a greater positive influence on perceived likelihood of weight gain and heart disease. Step 1: Problem Formulation

Step 2: Determine Research Design Dictated by the problem or research question Exploratory Research –“Discovery” Descriptive Research –“Relationships” Causal Research –Experiments

Step 2: Determine Research Design Stage in the Process Typical Questions Determine research design How much is already known? Can a hypothesis be formulated? What types of questions need to be answered? What type of study will best address the research questions?

“Attacking the Obesity Epidemic: An Examination of the Potential Health Benefits of Nutrition Information Provision in Restaurants,” American Journal for Public Health (2006) Determine Research Design –Two research problems (questions) require two designs –How good (accurate) are consumers at estimating the nutritional content of restaurant foods? Simple survey that asks participants to estimate nutritional content of common restaurant foods –Can providing objective nutrient information improve food evaluation and choice Between-subjects experiment Step 2: Determine Research Design

Step 3: Design Data Collection & Forms Secondary research – not necessary Survey Research –Lots of ways to collect data Measurement –Constructs / Variables

Step 3: Design Data Collection & Forms Stage in the Process Typical Questions Determine data collection method and forms Can existing data be used to advantage? What is to be measured? How? What is the source of the data? Can objective answers be obtained by asking people? How should people be questioned? Should the questionnaires be administered in person, over the phone, or through the mail? Should electronic or mechanical means be used to make the observations? Should structure or unstructured items be used to collect the data? Should the purpose of the study be made known to the respondents? Should rating scales be used in the questionnaire?

“Attacking the Obesity Epidemic: An Examination of the Potential Health Benefits of Nutrition Information Provision in Restaurants,” American Journal for Public Health (2006) Design Data Collection and Forms –Quantitative data needed –Questionnaires with estimations, multi-item attitudinal/risk/intentions variables Step 3: Design Data Collection & Forms

Step 4: Design Sample and Collect Data Determine your “target market” Determine necessary sample size Sampling Methodology Logistics Cost Ethics

Step 4: Design Sample and Collect Data Stage in the Process Typical Questions Design sample and collect the data Who is the target population? Is a list of population elements available? Is a sample necessary? Is a probability sample desirable? How large should the sample be? How should the sample be selected? Who will gather the data? How much supervision is needed? What operational procedures will be followed? What methods will be used to ensure the quality of the data collected?

“Attacking the Obesity Epidemic: An Examination of the Potential Health Benefits of Nutrition Information Provision in Restaurants,” American Journal for Public Health (2006) Design Sample and Collect Data –Adult Sample Recruited by undergrads Mail panel Step 4: Design Sample and Collect Data

Step 5: Analyze and Interpret the Data Edit / clean / code the data Analyze Interpret

Step 5: Analyze and Interpret the Data Stage in the Process Typical Questions Analyze and interpret the data Who will handle the editing of the data? How will the data be coded? Who will supervise the coding and keypunching? What tabulations / statistical tests / analysis techniques will be used?

“Attacking the Obesity Epidemic: An Examination of the Potential Health Benefits of Nutrition Information Provision in Restaurants,” American Journal for Public Health (2006) Analyze and interpret the data –Crosstabs and other simple computations –ANOVA / MANOVA / Chi-Square –Results show that most consumers are unaware of high levels of calories, fat, saturated fat, and sodium found in many menu items. Provision of nutrition information on restaurant menus could potentially have a positive impact on public health by reducing the consumption of less healthful foods Step 6: Analyze and Interpret the Data

Know your audience Sell your findings

Step 7: Prepare Research Report Stage in the Process Typical Questions Prepare the research report Who will read the report? What is their technical level of sophistication? Are managerial recommendations called for? What will be the format of the written report? Is an oral report necessary? How should the oral report be structured?

“Attacking the Obesity Epidemic: An Examination of the Potential Health Benefits of Nutrition Information Provision in Restaurants,” American Journal for Public Health (2006) Prepare Research Report –Manuscript prepared for journal submission Step 7: Prepare Research Report

Form Groups and… Contrast the process we have just talked about with that of Andreasen