1. CHAPTER one The Role of Marketing Research in Management
Decision Making
CHAPTER
one
Copyright © 2000 South-Western College Publishing Co.

2. Learning Objectives
1. To review the marketing concept and the marketing mix.
2. To comprehend the marketing environment within which managers must make decisions.
3. To define marketing research.
4. To understand the importance of marketing research in shaping marketing decisions.
5. To learn when marketing research should and should not be conducted.

3. (1) a consumer orientation (2) a goal orientation
To review the marketing concept and the marketing mix.
THE NATURE OF MARKETING
Marketing:
The process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods, and services.
The Marketing Concept
(1) a consumer orientation
(2) a goal orientation
(3) a systems orientation

4. To comprehend the marketing environment.
THE NATURE OF MARKETING
Identifying Target Markets and Researching the Marketing Mix: The Opportunistic Nature of Marketing Research
A marketing mix:
The unique blend of product/service, pricing, promotion, and distribution strategies designed to reach a specific target market.

5. Altering the marketing mix because of changes:
To comprehend the marketing environment.
THE EXTERNAL MARKETING ENVIRONMENT
Altering the marketing mix because of changes:
new consumers
new businesses
different
tastes
needs
incomes
lifestyles
purchasing habits

6. Marketing Research Defined
To define marketing research.
THE ROLE OF MARKETING RESEARCH IN DECISION MAKING
Marketing Research Defined
The planning, collection, and analysis of data relevant to market decision making and communication of the results of this analysis to management.
The Importance of Marketing Research to Management
descriptive function
diagnostic function
predictive function
The Unrelenting drive for Quality and Customer Satisfaction

7. Demographics of Coupon Users
Heavy
(top 20%)
Medium-
Light
Nonuser
Table 1.1
Average household size
3.6
3.2
3.4
Average age female head
43.1
45.2
41.9
Household income ($000)
$30.9
$29.1
$28.7
Female head attended college
51%
50%
52%
Average monthly grocery bill
$334
$292
$303
Female head does not work
outside or works part time
65%
61%
55%

8. The Paramount Importance of Keeping Existing Customers
To understand the importance of marketing research.
THE ROLE OF MARKETING RESEARCH IN DECISION MAKING
The Paramount Importance of Keeping Existing Customers
Managers Must Understand the Ever-Changing Marketplace
The Proactive Role of Marketing Research
A proactive management:
alters the marketing mix to fit newly emerging patterns in economic, social, and competitive environments
new opportunities
develops a long-run marketing strategy

9. Figure 1.1 Emergent Markets
THE ROLE OF MARKETING RESEARCH IN DECISION MAKING

10. Applied Research versus Basic Research
To understand the importance of marketing research.
THE ROLE OF MARKETING RESEARCH IN DECISION MAKING
Applied Research versus Basic Research
Basic research hopes to provide further confirmation to an existing theory or to learn more about a concept or phenomenon.
Most research undertaken by businesses is applied research because it must be:
cost effective
of demonstrable value to the decision maker

11. In a number of situations it is best not to conduct market research.
To learn when marketing research should and should not be conducted.
DECIDING WHETHER TO CONDUCT MARKET RESEARCH
A manager faced with several alternative solutions to a problem should not instinctively call for applied marketing research.
The first decision to be made is whether to conduct marketing research at all.
In a number of situations it is best not to conduct market research.

12. insufficient funds to implement decisions from research
To learn when marketing research should and should not be conducted.
DECIDING WHETHER TO CONDUCT MARKET RESEARCH
A Lack of Resources
Two situations:
lack of funds
insufficient funds to implement decisions from research
Research Results Would Not Be Useful
Clients may be hard-pressed to use the information

13. Poor Timing in the Marketplace
To learn when marketing research should and should not be conducted.
DECIDING WHETHER TO CONDUCT MARKET RESEARCH
Poor Timing in the Marketplace
Marketing research should not be undertaken if the opportunity for successful entry into a market has passed.
The Decision Has Already Been Made
Marketing research may be used improperly.

14. The wrong phenomena might be studied
To learn when marketing research should and should not be conducted.
DECIDING WHETHER TO CONDUCT MARKET RESEARCH
When Managers Cannot Agree on What They Need to Know to Make a Decision
The wrong phenomena might be studied
When Decision-Making Already Exists
Further research may be redundant and costly
When the Costs of Conducting Research Outweigh the Benefits
Potential new products with large profit margins may have a greater potential

15. Deciding Whether to Conduct Market Research
Table 1.2
Market Size
Small Profit Margin
Large Profit Margin
Cost likely to be greater than benefit; e.g.,
eyeglasses replacement screw
tire valve extension
Possible benefits greater than cost; e.g.,
ultraexpensive Lambeggehni-type sportswear
Small
DON’T CONDUCT MARKETING RESEARCH
PERHAPS CONDUCT MARKETING RESEARCH

16. Deciding Whether to Conduct Market Research
Table 1.2
Market Size
Small Profit Margin
Large Profit Margin
Benefits likely to be greater than costs; e.g.,
Stouffers frozen entries
Crest’s tarter control toothpastes
Benefits likely to be greater than costs; e.g.,
medical equipment
high-definition TV
Large
PERHAPS CONDUCT MARKETING RESEARCH
CONDUCT MARKETING RESEARCH

17. Ways to Use the Internet in Marketing Research
Major internet use
GOING ON- LINE
Ways to Use the Internet in Marketing Research
Secondary source material
Data collection
Project management
Report distribution
General communication

18. The End
Copyright © 2000 South-Western College Publishing Co.