Introduction to Data

Marketing Research Process 1. Formulate Problems 6. Research Report - Specify Research Objectives 2. Research Design 5. Data Analysis - Exploratory, - Interpretation Descriptive, Causal 3. Data Collection Method 4. Sample Design -Primary, secondary - Sampling frame, -Questionnaire Design sample selection, -Attitude Measurement sample size

Sources of Data Secondary data: data that has been previously gathered for some purposes. –Advantage: inexpensive, can be secured quickly. –Disadvantage: unknown accuracy, ill fitting for the problem Primary data: data gathered for the specific problem at hand.

Data Type SecondaryPrimary InternalExternalNon-experimentalExperimental QualitativeQuantitativeFieldLaboratory

Sources of Secondary Data Secondary Data Internal External Published data Standardized sources of marketing data Internet Sales/patronage results (outcomes) Marketing activity (inputs) Cost information Distributor reports/feedback Customer feedback Store audits Warehouse withdrawal services Consumer purchase panels Single source data Nielsen’s television index Starch scores Arbitron panel Multimedia services Printed Electronic Government Trade associations Periodicals Newspapers Books Annual reports Private studies

Uses of Secondary Data  Can solve the problem on hand all by its own  Can lead to new ideas and other sources  Helps to define the problem more clearly  Can help in designing the primary data collections process  Helps in defining the population / sample  Can serve as a reference base

Benefits and Limitations of Secondary Data Benefits  Low cost  Less effort  Less time  Some information only from secondary sources Limitations  Collected for other purpose  No control over data collection  Potential accuracy problem  May not be reported in required form  May be outdated  May not meet requirements

Appraising Secondary Sources Factors to Be Considered  Who has collected the data (did they have adequate resources)?  Why was the data collected (how the interests of agency match with ours)?  How the data was collected (to determine the quality of data on-hand)?  What data was collected (geographic and demographic limitations)?  When the data was collected (how old/obsolete is the data)?

Standardized Sources Syndicated sources of marketing data:  Store audits  consumer panels  scanner based systems and single source data

Retail Store Audits  Personally record store inventories and movements for any brand and size  Basic measurement tool in lieu of scanning data  Common categories: Health and Beauty, Durable, Confectionery, Liquor.  Example: Nielsen Retail Index

Consumer Purchase Panels Audits and scanner data do not cover:  Who buys (consumer demographics)  Frequency of purchases  Switching behavior between brands and stores  Level of deal sensitivity

What is a “Panel’’? Representative sample of households Records all purchases made over time (cross-section/time-series) Records all coupons used Receive incentive for co-operation ACNielsen’s Consumer Panel: “Homescan” Consists of 40,000 demographically balanced U.S. households that use hand-held scanners to record every bar-coded item purchased

Advantage/Limitation of Panel Advantage: Can Provide Information On  Aggregate Sales Activity  Brand Shares  Shifts in Buyer Characteristics  Shifts in Retail Outlets Limitation: Possibility of  Selection Bias  Mortality Effect -move, illness, refusal  Testing Effects - first month records are discarded

Scanner Data  Have revolutionized grocery (and retail ) industry  Generates huge amounts of data  Main suppliers: IRI, Nielsen  Kraft Food spends more than $30 million per year on scanner data  In comparison to survey research: scanner data reveal actual consumer behavior

Primary Data and Collection Demographic/socioeconomic characteristics Psychographic/lifestyle analysis Attitude/opinions Awareness/knowledge Intentions Motivation Behavior sales PAIMARY DATA Collected via Communication Observation (Versatility, Speed, Cost) (Objectivity, Accuracy)

Communication – A method of data collection involving questioning of respondents to secure the desired information, using a data collection instrument called a questionnaire. – Stated preference –personal interview, telephone interview, mail questionnaire Observation –A method of data collection in which the situation of interest is watched and the relevant facts, actions, or behaviors are recorded. – Revealed preference – human observation, mechanical observation Primary Data Collection Method

 Structure: degree of standardization imposed on data collection instrument. Are there clearly specified hypotheses to be tested?  Disguise. Amount of knowledge about the purpose of study communicated to respondents (communication). Subjects awareness of being observed for research.

STRUCTUREDUNSTRUCTURED Un dis gui se d Standardized questions Standardized responses Ex) fixed alternative questions Simple administration Simple analysis Suitable for facts or clear-cut opinions Nonstandardized questions Nonstandardized responses Ex) depth interviews Flexible Difficult interpretation Interviewer influenced Better for exploratory research Dis gui se d Standardized questions Standardized responses Simple administration Simple analysis Difficult interpretation Least used method Nonstandardized questions Nonstandardized responses Ex) projective techniques Difficult analysis Subjective interpretation Suitable for exploratory research

Summary Secondary data: Internal/External Growth of Standardized source of data Store audit/panel/scanner/single-source data  Primary data is collected through communication and/or observation.  Both methods are classified according to degree of structure and degree of disguise.  Degree of structure depends on research design, whether specific research hypotheses have been developed.  Degree of disguise depends on how subject awareness may affect research outcome.