MARKETING RESEARCH

A process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods and services to create exchanges that satisfy individual and organizational objectives. Marketing

What is Research? Investigation or experimentation aimed at the discovery and interpretation of facts

The planning, collection, and analysis of data relevant to marketing decision making and the communication of the results of this analysis to management McDaniel and Gates 2006 What is Marketing Research?

What functions should be performed to successfully market this product? What are all the potential research activities needed to support each of these marketing functions?

Why Should Organizations Spend Money on Market Research?

“TO GUESS IS CHEAP, TO GUESS WRONGLY IS EXPENSIVE” Marketing research is an investment that produces great returns by reducing the possibility of failure and enhancing the success of marketing strategies and decision-making Chinese proverb

How does research achieve reduction in risk? Why should research be hypothesis driven? Indigo books has noticed that many customers abandon the shopping process part way through. What might be the reasons for this?

Product Price Promotion Place What sort of decisions does management face that require information (i.e. Marketing research)

ARTART ccurate elevant imely What Qualities of the data will be relevant to marketing decision making?

“How many people like your product?” Predictive if done correctly Surveys: Telephone, Mail, Intercept, Internet What are the Two main types of information? Qualitative “How do people feel about the your product?” Not predictive of market behavior Qualify needs, wants, preferences Focus Groups, In-depth interviews Quantitative

Marketing Research Customer Databases Internal Reporting Systems/ Scanner Data The Internet / On-line Sources What are the Major Sources of Information?

–Secondary Research Existing studies, census data, articles Internet, library, trade journals Non-specific and often dated –Primary Research data originated specifically for the study at hand Create your own questions and find your own answers by asking people what they think, feel, know, etc. Common methods include: –Focus groups, surveys What are Two main sources of information?

Types Of Research Exploratory Descriptive Causal

Exploratory Research (Unaware of Problem) “Our sales are declining and we don’t know why.” “Would people be interested in our new product idea?” Descriptive Research (Aware of Problem) “What kind of people are buying our product? Who buys our competitor’s product?” “What features do buyers prefer in our product?” Causal Research (Problem Clearly Defined) “Will buyers purchase more of our products in a new package? “Which of two advertising campaigns is more effective?” Uncertainty Influences The Type Of Research COMPLETELY CERTAINABSOLUTE AMBIGUITY CAUSAL OR DESCRIPTIVE EXPLORATORY

Exploratory Research Initial research conducted to clarify and define the nature of a problem Does not provide conclusive evidence Helps develop hypotheses but does not test them Subsequent research expected Published sources, depth interviews, focus groups characterized by its flexibility

Descriptive Research Describes characteristics of a population or phenomenon (who, what, where, when, why, and how) Some understanding of the nature of the problem Tends to be more quantitative then qualitative Tests hypotheses and provides conclusive information more rigid than exploratory research

Causal Research Conducted to identify cause and effect relationships accomplishes goal through laboratory and field experiments

Determining When to Conduct Marketing Research Time constraints Availability of data Nature of the decision Benefits versus costs When would you not want to conduct Market Research?

The Bank of Montreal has been trying to sell its services online but finds that new web users are not signing up for services. Management wonders whether or not they should we invest in a guided tour? Should they conduct market research to help them decide? A guided tour involves a considerable financial risk. There are also concerns about brand image. So they decide to proceed with the research. What do they need to know? What are some hypotheses as to why users are not signing up? How might they discover which, if any, of these possible reasons is correct? Assume they discover that the reason was a poor portrayal of the value proposition, I.e.people did not understand why they should use the service. What would be the next step?

Anecdotal evidence suggests that although customers like the performance and comfort of the Ford Crown Victoria, they are not overly enthusiastic about it’s design which has not changed for over 13 years. Ford has decided to hire an external market research company (i.e. you) to find out how the public are likely to feel about a new design. What steps would you take to provide this information?

The Marketing Research Process Problem identification specifying what information is required designing the method for collecting information managing and implementing the collection of data Preparing, analyzing and interpreting the data communicating the findings and their implications.

The Marketing Research Process Problem Discovery Exploratory Research Selection of the Basic Research Method Selection of Sample Design Collection of the Data

The Research Process (cont.) Editing and Coding Data ProcessingInterpretation of the Findings Report

Would you talk only to current owners? Would you talk to only 10 people? Would it matter if you asked them about Ford Escalade? Would it matter if did a multiple regression analysis? Would you talk only to men?

Marketing research works because, by talking to a relatively small number of people, it is possible to find out about a far larger number.  it only works if you talk to the right number of people,  it only works if you talk to the right type of people and  it only works if you ask the right questions  and analyze the data you get in the right way. But…..

“The formulation of the problem is often more essential than its solution” Albert Einstein

The Management Problem versus the Marketing Research Problem A distinction must be made between the management problem and the marketing research problem. Management Problem Marketing Research Problems Focus on symptoms Action oriented Focus on causes Data oriented