2. Arab World Edition Kotler, Keller, Hassan, Baalbaki and Shamma
Marketing Management
Arab World Edition
Kotler, Keller, Hassan, Baalbaki and Shamma
Chapter 4
Conducting
Marketing Research
and Forecasting
Demand

3. Chapter Questions What constitutes good marketing research?
What are good metrics for measuring marketing productivity?
How can marketers assess their return on investment of marketing expenditures?
How can companies more accurately measure and forecast demand?
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4. The Marketing Research System
Chapter Question 1:
What constitutes good marketing research?
The Marketing Research System
Marketing research is the systematic design, collection, analysis, and reporting of data and findings relevant to a specific marketing situation facing the company.
P&G has a dedicated Consumer & Market Knowledge (CMK) market research function.
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5. The Marketing Research System
Chapter Question 1:
What constitutes good marketing research?
The Marketing Research System
Marketing research is often done by an outside research firm.
There are three categories of marketing research firm:
Syndicated-service research firms: gather consumer and trade information which they sell for a fee.
Custom marketing research firms: hired to carry out specific projects.
Specialty-line marketing research firms: provide specialist service such as field interviews.
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6. The Marketing Research System
Chapter Question 1:
What constitutes good marketing research?
The Marketing Research System
Small companies use creative and affordable ways to conduct research such as:
Engaging students or professors to design and carry out projects
Using the internet
Checking out rivals. Many small companies routinely visit their competitors
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7. The Marketing Research Process
Chapter Question 1:
What constitutes good marketing research?
The Marketing Research Process
Effective marketing research follows the six steps shows in Figure 4.1.
Fig. 4.1: The Marketing Research Process
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8. Step 1: Define the Problem and Research Objectives
Chapter Question 1:
What constitutes good marketing research?
Step 1: Define the Problem and Research Objectives
Define the problem
Specify decision alternatives
State research objectives
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9. Step 2: Develop the Research Plan
Chapter Question 1:
What constitutes good marketing research?
Step 2: Develop the Research Plan
To design a research plan, we need to make decisions about:
Data sources:
Primary data or secondary data?
Research approach – could involve:
Observational research
Ethnographic research
Focus-group research
Survey research
Behavioral data
Experimental research
A focus group in session
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10. Step 2: Develop the Research Plan
Chapter Question 1:
What constitutes good marketing research?
Step 2: Develop the Research Plan
(Decisions to make, continued):
Research instruments:
Questionnaires
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11. Question Types – Dichotomous
Chapter Question 1:
What constitutes good marketing research?
Question Types – Dichotomous
In arranging this trip, did you contact American Airlines?
 Yes  No
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12. What constitutes good marketing research?
Chapter Question 1:
What constitutes good marketing research?
Question Types – Multiple Choice
With whom are you traveling on this trip?
 No one
Spouse
Spouse and children
Children only
Business associates/friends/relatives
An organized tour group
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13. What constitutes good marketing research?
Chapter Question 1:
What constitutes good marketing research?
Question Types – Likert Scale
Indicate your level of agreement with the following statement: Small airlines generally give better service than large ones.
 Strongly disagree
Disagree
Neither agree nor disagree
Agree
Strongly agree
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14. What constitutes good marketing research?
Chapter Question 1:
What constitutes good marketing research?
Question Types – Semantic Differential
Royal Jordanian Airlines
Large ………………………………...…….Small
Experienced………………….….Inexperienced
Modern……………………….…..Old-fashioned
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15. What constitutes good marketing research?
Chapter Question 1:
What constitutes good marketing research?
Question Types – Importance Scale
Airline food service is _____ to me.
 Extremely important
Very important
Somewhat important
Not very important
Not at all important
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16. What constitutes good marketing research?
Chapter Question 1:
What constitutes good marketing research?
Question Types – Rating Scale
Royal Jordanian Airlines’ food service is _____.
 Excellent
Very good
Good
Fair
Poor
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17. What constitutes good marketing research?
Chapter Question 1:
What constitutes good marketing research?
Question Types – Intention-to-Buy Scale
How likely are you to purchase tickets on American Airlines if in-flight internet access were available?
 Definitely buy
Probably buy
Not sure
Probably not buy
Definitely not buy
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18. What constitutes good marketing research?
Chapter Question 1:
What constitutes good marketing research?
Question Types – Completely Unstructured
What is your opinion of American Airlines?
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19. What constitutes good marketing research?
Chapter Question 1:
What constitutes good marketing research?
Question Types – Word Association
What is the first word that comes to your mind when you hear the following?
Airline ________________________
Royal Jordanian __________________
Travel ________________________
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20. What constitutes good marketing research?
Chapter Question 1:
What constitutes good marketing research?
Question Types – Sentence Completion
When I choose an airline, the most important consideration in my decision is: ________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________.
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21. What constitutes good marketing research?
Chapter Question 1:
What constitutes good marketing research?
Question Types – Story Completion
“I flew by American Airways a few days ago. I noticed that the exterior and interior of the plane had very bright colors. This aroused in me the following thoughts and feelings.” Now complete the story. __________________________________________________________________________________________________________________________________________________________________________________________________________________________________________
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22. What constitutes good marketing research?
Chapter Question 1:
What constitutes good marketing research?
Question Types – Picture (Empty Balloons)
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23. Step 2: Develop the Research Plan
Chapter Question 1:
What constitutes good marketing research?
Step 2: Develop the Research Plan
(Decisions to make, continued):
Research instruments:
Qualitative measures
Word association
Projective techniques
Visualization
Brand personification
Laddering
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24. Step 2: Develop the Research Plan
Chapter Question 1:
What constitutes good marketing research?
Step 2: Develop the Research Plan
(Decisions to make, continued):
Research instruments:
Technological devices
Galvanometers
Tachistoscope
Eye cameras
Audiometers
GPS
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25. Step 2: Develop the Research Plan
Chapter Question 1:
What constitutes good marketing research?
Step 2: Develop the Research Plan
(Decisions to make, continued):
Sampling plan
Sampling unit: Who is to be surveyed?
Sample size: How many people should be surveyed?
Sampling procedure: How should the respondents be chosen?
Contact methods
Mail questionnaire
Telephone interview
Personal interview
Online interview
Insights from Kraft-sponsored online communities helped the company develop its popular line of 100-calorie snacks.
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26. Step 2: Develop the Research Plan
Chapter Question 1:
What constitutes good marketing research?
Step 2: Develop the Research Plan
Table 4.3: Probability and Nonprobability Samples
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27. Step 3: Collect the Information
Chapter Question 1:
What constitutes good marketing research?
Step 3: Collect the Information
Data-collection phase is generally the most expensive and the most prone to error.
Problems collecting survey data include:
Respondents not at home/not contactable
Respondents refuse to cooperate
Respondents give biased or dishonest answers
Interviewers are biased or dishonest
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28. Step 4: Analyze the Information
Chapter Question 1:
What constitutes good marketing research?
Step 4: Analyze the Information
Extract the findings by:
Tabulating the data
Working out averages and measures for spotting patterns
Applying statistical techniques and decision models
Testing different hypotheses and theories
Applying sensitivity analysis to test strength of conclusions
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29. Step 5: Present the Findings
Chapter Question 1:
What constitutes good marketing research?
Step 5: Present the Findings
Researcher presents findings relevant to the major marketing decisions facing management.
Researchers are often asked to add their opinion and recommendations, to act as consultants.
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30. Step 6: Make the Decision
Chapter Question 1:
What constitutes good marketing research?
Step 6: Make the Decision
Many organizations use a marketing decision support system (MDSS) to help marketing managers make better decisions.
A MDSS is a coordinated collection of data, systems, tools, and techniques with supporting software and hardware by which an organization gathers and interprets relevant information from business and the environment and turns it into a basis for marketing action.
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31. Table 4.5: The Seven Characteristics of Good Marketing Research
Chapter Question 1:
What constitutes good marketing research?
Table 4.5: The Seven Characteristics of Good Marketing Research
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32. Overcoming Barriers to the Use of Marketing Research
Chapter Question 1:
What constitutes good marketing research?
Overcoming Barriers to the Use of Marketing Research
Many companies fail to use marketing research sufficiently or correctly. Reasons for this include:
A narrow conception of the research
Uneven caliber of researchers
Poor framing of the problem
Late and sometimes incorrect findings
Personality and presentational differences
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33. Measuring Marketing Productivity
Chapter Question 2:
What are good metrics for measuring marketing productivity?
Measuring Marketing Productivity
Marketing metrics are the set of measures that helps marketers quantify, compare, and interpret marketing performance.
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34. What are good metrics for measuring marketing productivity?
Chapter Question 2:
What are good metrics for measuring marketing productivity?
Marketing Metrics
Companies should ask themselves five questions to review how they measure their marketing performance:
Do you routinely research consumer behavior (retention, acquisition, usage) and why consumers behave that way?
Do you routinely report the results of this research to the board in a format integrated with financial marketing metrics?
In those reports, do you compare the results with the levels previously forecasted in the business plans?
Do you also compare them with the levels achieved by your key competitor using the same indicators?
Do you adjust short-term performance according to the change in your marketing-based asset(s)?
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35. Table 4.6: Sample Marketing Metrics
Chapter Question 2:
What are good metrics for measuring marketing productivity?
Table 4.6: Sample Marketing Metrics
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36. Marketing-Mix Modeling
Chapter Question 3:
How can marketers assess their return on investment of marketing expenditures?
Marketing-Mix Modeling
Marketing-mix models analyze data from a variety of sources, such as retailer scanner data, company shipment data, pricing, media, and promotion spending data, to understand more precisely the effects of specific marketing activities.
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37. Chapter Question 3:
How can marketers assess their return on investment of marketing expenditures?
Marketing Dashboards
A customer-performance scorecard records how well the company is doing year after year on customer-based measures.
A stakeholder-performance scorecard tracks the satisfaction of various constituencies who have a critical interest in and impact on the company’s performance including employees, suppliers, banks, distributors, retailers, and stockholders.
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38. Box 4.1: Sample Customer-Performance Scorecard Measures
Chapter Question 3:
How can marketers assess their return on investment of marketing expenditures?
Box 4.1: Sample Customer-Performance Scorecard Measures
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39. Fig. 4.2: Marketing Measurement Pathway
Chapter Question 3:
How can marketers assess their return on investment of marketing expenditures?
Fig. 4.2: Marketing Measurement Pathway
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40. Fig. 4.3: Example of a Marketing Dashboard
Chapter Question 3:
How can marketers assess their return on investment of marketing expenditures?
Fig. 4.3: Example of a Marketing Dashboard
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41. Forecasting and Demand Measurement
Chapter Question 4:
How can companies more accurately measure and forecast demand?
Forecasting and Demand Measurement
The Measures of Market Demand
Fig. 4.4 shows 90 different types of demand measurement.
But there are productive ways to
break down the market, for example:
Potential market
Available market
Target market
Penetrated market
Fig. 4.4: Ninety Types of Demand Measurement
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42. How can companies more accurately measure and forecast demand?
Chapter Question 4:
How can companies more accurately measure and forecast demand?
A Vocabulary for Demand
Measurement
Market demand
Market forecast
Market potential
Company demand
Company sales forecast
Company sales potential
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43. Fig. 4.5: Market Demands Functions
Chapter Question 4:
How can companies more accurately measure and forecast demand?
A Vocabulary for Demand
Measurement
Fig. 4.5: Market Demands Functions
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44. How can companies more accurately measure and forecast demand?
Chapter Question 4:
How can companies more accurately measure and forecast demand?
Estimating Current Demand
Marketing managers want to estimate:
Total market potential
Use: chain-ratio method
Area market potential
Use: market-buildup method, or multiple-factor index method
Industry sales and market shares
Identify competitors and estimate their sales
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45. How can companies more accurately measure and forecast demand?
Chapter Question 4:
How can companies more accurately measure and forecast demand?
Estimating Future Demand
How do companies develop their forecasts?
Survey of buyers’ intentions
Composite of sales force opinions
Expert opinion
Past-sales analysis
Market-test method
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46. Credits Slide 1 Camera Press Ltd: Richard Wayman
Slide 3 Press Association Images: Wilfredo Lee / AP
Slide 8 Alamy Images: Adams Picture Library t / a apl
Slide 24 Alamy Images: Jeff Greenberg
Slide 34 “What does marketing success look like?”, Marketing Management, Vol 10 (1), pp.12–18, (Ambler, T., 2001), copyright © American Marketing Association. Reproduced by permission of AMA and the author
Slide 30 Adapted from Patrick LaPointe, Marketing by the Dashboard Light – How to Get More Insight, Foresight, and Accountability from Your Marketing Investments. © 2005, Patrick LaPointe