Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 5- 1 Basic Marketing Research: Using Microsoft Excel Data Analysis, 3 rd edition Alvin C. BurnsLouisiana State University Ronald F. BushUniversity of West Florida

Primary vs. Secondary Data Primary data refers to information that is developed or gathered by the researcher specifically for the research project at hand Secondary data have previously been gathered by someone other than the researcher and/or for some other purpose than the research project at hand. Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 5- 2

Uses of Secondary Data The applications of secondary data range from predicting broad changes in a culture’s “way of life” to specific applications such as selecting a street address location for a new car wash. Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 5- 3 See: for examples of applications of secondary data

Classification of Secondary Data Internal Secondary Data Internal secondary data have been collected within the firm Database marketing is the process of building, maintaining, and using customer (internal) and other (internal) databases (products, suppliers, resellers) to contact, transact, and build customer relationships. Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 5- 4

Internal Databases Internal databases consist of information gathered by a company, typically during the normal course of business transactions Companies use their internal databases for purposes of direct marketing and to strengthen relationships with customers, called customer relationship management (CRM). Data mining is a type of software available to help managers make sense out of seemingly senseless masses of information contained in databases Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 5- 5

External Secondary Data External secondary data are obtained from outside the firm. There are three sources of external data: Published Syndicated Services Data External databases Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 5- 6

External Secondary Data: Published Published sources of information are prepared for public distribution Different types of publications and their functions: 1.Reference Guides- refer to types of other reference sources and recommended specific titles. Guides tell you where to look to find different types of information Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 5- 7

External Secondary Data: Published, Continued... 2.Indexes and Abstracts- List periodical articles by subject, author, title, keyword, and more. Abstracts also provide summaries of the articles. 3.Bibliographies- Lists varied sources such as books and journals on a particular topic. 4.Almanacs, Manuals, & Handbooks- “Deskbooks” that provide a wide variety of data in a single, handy publication. 5.Dictionaries- Define terms and are sometimes available for special subject areas. Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 5- 8

External Secondary Data: Published, Continued... 6.Encyclopedias- Provide essays, usually in alphabetical order, by topic. 7.Directories- List companies, people, products, organizations, among others; usually providing brief information about each industry. 8.Statistical Sources- Provide numeric data, often in tables, pie charts, and bar charts. 9.Bibliographical Sources- Provide information about people. Useful for information on CEOs and others. 10.Legal Sources- Provide information about legislation, regulations, and case law. Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 5- 9

External Secondary Data: Syndicated Services Data Syndicated services data are provided by firms that collect data in a standard format and make them available to subscribing firms. Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 5- 10

External Secondary Data: External Databases External databases are supplied by organizations outside the firm. Online information databases are sources of secondary data searchable by search engines online. Examples: Factiva® Lexis-Nexis® ABI Inform® Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 5- 11

Advantages of Secondary Data Advantages of secondary data Data can be obtained quickly Inexpensive Usually available Enhances primary data collection Sometimes achieves the research objective Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 5- 12

Disadvantages of Secondary Data 5 problems associated with secondary data: Incompatible reporting units Mismatch of the units of measurement Differing definitions used to classify the data The timeliness of the secondary data Lack of information needed to assess the credibility of the data reported Let’s take a closer look at each of these… Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 5- 13

Disadvantages of Secondary Data: Incompatible Reporting Units Secondary data are provided in reporting units such as county, city, metro area, state, region, zip code, or core-based statistical areas The reporting unit found in the information source, i.e. county, may not be what the user needs, i.e. zip code. Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 5- 14

Core-based Statistical Areas (CBSAs) CBSAs are geographical reporting units used by the Census Bureau Metropolitan SAs are defined by the Office of Management and Budget (OMB) as having at least one urban area of 50,000 or more population, plus adjacent territory that has a high degree of social and economical integration with the core as measured by commuting ties. Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 5- 15

Core-based Statistical Areas (CBSAs), Continued... Micropolitan SAs are a new set of statistical areas that have at least one urban cluster of at least 10,000 but less than 50,000 population, plus adjacent territory that has a high degree of social and economical integration with the core MSA as measured by commuting ties. Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 5- 16

Geodemographics Geodemographics is the term used to describe the classification of arbitrary, usually small, geodemographic areas in terms of the characteristics of their inhabitants. Geodemographics allows users to specify the data reporting unit. Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 5- 17

Disadvantages of Secondary Data: Measurement Units Do Not Match Sometimes measurement units reported in secondary data sources do not match the researcher’s needs. Household income is reported but the researcher needs per capita income. Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 5- 18

Disadvantages of Secondary Data: Class Definitions Are Not Usable There is a problem when the researcher needs to know the percent of households having incomes over $80,000 and the secondary data source provides the highest category at $50,000 and over. Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 5- 19

Disadvantages of Secondary Data: Data Are Outdated The time that passed since the last publication can be a problem when applying the data to a current situation. The researcher must make the decision as to whether or not to use the data. Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 5- 20

Evaluating Secondary Data You must evaluate information before you use it as a basis for making decisions. How do you evaluate information…… Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 5- 21

Reliability of Secondary Information To determine the reliability of secondary information, marketing researchers must evaluate it. What was the purpose of the study? Who collected the information? What information was collected? How was the information obtained How consistent is the information among sources? Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 5- 22

Key Sources of Secondary Data for Marketers Table 5.2 provides you with some of the major sources of secondary data for marketing information. Note the information is provided by TYPE of secondary information source. Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 5- 23

Census 2010 and American Community Survey Go to Much information is now available from the 2010 Census A key new information source, available annually is the American Community Survey… Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 5- 24

American Community Survey The American Community Survey may represent the most significant change in the availability of secondary data to be used for marketing research purposes in several decades. The primary advantage is that the ACS will provide data annually instead of once every ten years. Since these data will have the U.S. Census Bureau’s “high marks” for reliable data and will be current, the ACS is likely to become a major secondary data resource for marketing researchers. Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 5- 25

American Community Survey, Continued... Figure 5.1 provides you with essential information needed to understand the basics of the ACS and Marketing Research Application 5.1 provides you with an illustration of its use for a marketing research objective Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 5- 26

What is Standardized Information? Standardized information is a type of secondary data in which the data collected and/or the process of collecting data are standardized for all users. Two broad classes of standardized information are: Syndicated data Standardized services Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 5- 27

Standardized Information: Syndicated Data Syndicated data are collected in standard format and made available to all subscribers. Advantages: Shared Costs Quality of data collected Data are normally disseminated very quickly Disadvantages: Little control over what data are collected Buyers must commit to long term contracts Competitors have access to the same information Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 5- 28

Standardized Information: Standardized Services Standardized services refer to a standardized marketing research process that is used to generate information for a particular user. Advantages: Using the experience of the firm offering the service Reduced costs Increased speed of conducting the service Disadvantages: Inability to customize services Service firm not being knowledgeable about the client’s industry Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 5- 29

Applications of Standardized Information Measuring customer’s attitudes Defining market segments Conducting market tracking studies Monitoring media usage and promotion effectiveness Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 5- 30

ESRI offers a Standardized Service: Tapestry™ Segmentation Tapestry™ Segmentation divides the U.S. into 65 different segments based upon demographic and socioeconomic characteristics. Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 5- 31

Experian Simmons Offers a Service that can help a firm identify Market Mavens Market Mavens are identified by their peers as sources of information about products/services and shopping. They provide facts but let others make their own decisions. See MRA 5.2 Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 5- 32

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