1. Marketing Research and Information Systems7
Marketing Research and Information Systems

2. Objectives
To describe the basic steps in conducting marketing research
To explore the fundamental methods of gathering data for marketing research
To describe the nature and role of information systems in marketing decision making
To understand how such tools as databases, decision support systems, and the Internet facilitate marketing research
To identify key ethical and international considerations in marketing research
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3. The Importance of Marketing Research The Marketing Research Process
Chapter Outline
The Importance of Marketing Research
The Marketing Research Process
Using Technology to Improve Marketing Information Gathering and Analysis
Issues in Marketing Research
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4. The Importance of Marketing Research
The systematic design, collection, interpretation, and reporting of information to help marketers solve specific marketing problems or take advantage of marketing opportunities
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5. U.S. Hot Dog Consumption
Hot dogs consumed between Memorial Day and Labor Day
7 billion
Average number of hot dogs eaten per person from Memorial Day to Labor Day 24
Rate of consumption during this time
818 hot dogs/second
Top 5 Major League Ball Parks for Hot Dog Consumption
1. Dodger Stadium
1.6 million
2. Coors Field
1.5 million
3. Wrigley Field
4. Yankee Stadium
1.3 million
5. Minute Maid Park
1.2 million
Source: National Hot Dog and Sausage Council, as reported in American Demographics, July/August 2004 p. 48.
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6. The Importance of Marketing Research (cont’d)
Benefits of Marketing Research
Helps firms stay in touch with customers’ changing attitudes and purchase patterns
Assists in better understanding market opportunities
Determines the feasibility of a particular marketing strategy
Aids in the development of marketing mixes to match the needs of customers
Improves marketer’s ability to make decisions
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7. Net Sights
Perhaps one of the best-known pollsters and research firms, the Gallup Organization, has been conducting public opinion surveys and since The company is often called on to survey the public about political issues, business and economic issues, social issues, and lifestyle topics. To view the company’s latest survey results, visit
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8. The Five Steps of the Marketing Research Process
FIGURE 7.1
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9. The Marketing Research Process
Locating and Defining Problems or Research Issues
Focusing on uncovering the nature and boundaries of a situation or question related to marketing strategy or implementation
Departures from normal or expected marketing results
Biases in marketing information that distort its meaning
Evidence of possible or potential market opportunities
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10. Top 5 Greatest “Brain Gain” and “Brain Drain” Markets
Brain Gaining* Metro Regions
1. Atlanta, GA
76,443
2. Phoenix-Mesa, AZ
63,084
3. Dallas-Fort Worth, TX
54,814
4. San Francisco-Oakland-San Jose, CA
48,614
5. Denver-Boulder-Greeley, CO
40,973
Brain Draining* Metro Regions
1. New York-Northern New Jersey-Long Island, NY-NJ
(122,000)
2. Chicago-Gary-Kenosha, IL-IN-WI
(29,647)
3. Pittsburgh, PA
(20,065)
4. Detroit-Ann Arbor-Flint, MI
(17,224)
5. Buffalo-Niagara Falls, NY
(17,171)
*Net domestic migration gains (losses) among college graduates aged 25 and older.
Source: William H. Frey, “Brain Gains, Brain Drains,” American Demographics, June 1, 2004,
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11. The Marketing Research Process (cont’d)
Designing the Research Project
Research design
An overall plan for obtaining the information needed to address a research problem or issue
Hypothesis
An informed guess or assumption about a certain problem or set of circumstances
Accepted or rejected hypotheses act as conclusions for the research effort
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12. The Marketing Research Process (cont’d)
Types of Research
Exploratory research
Research conducted to gather more information about a problem or to make a tentative hypothesis more specific
Descriptive research
Research conducted to clarify the characteristics of certain phenomena to solve a particular problem
Causal research
Research in which it is assumed that a particular variable X influences a variable Y
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13. The Marketing Research Process (cont’d)
Research Reliability and Validity
Reliability
A condition existing when a research technique produces almost identical results in repeated trials
Validity
A condition existing when a research method measures what it is supposed to measure
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14. The Marketing Research Process (cont’d)
Collecting Data
Types of data
Primary data: data observed and recorded or collected directly from respondents
Secondary data: data complied both inside and outside the organization for some purpose other than the current investigation
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17. SNL DataSource provides a broad array of secondary data in the financial services industry
Reprinted with permission of Greg Amonette, SNL Financial, snl.com
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18. Top 10 Metro Markets with Married and Unmarried Gay and Lesbian Households
San Francisco-Oakland-San Jose, CA
Santa Fe, NM
Portland, ME
Miami-Fort Lauderdale, FL
Bloomington, IN
Austin-San Marcos, TX
Madison, WI
Burlington, VT
Springfield, MA
Seattle-Tacoma, WA
Source: Christopher Reynolds, “Still a Hidden Market,” American Demographics, April 1, 2004,
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19. The Marketing Research Process (cont’d)
Methods of Collecting Primary Data
Sampling
Population—all the elements, units, or individuals of interest to researchers for specific study
Sample—a limited number of units chosen to represent the characteristics of a total population
Types of sampling
Probability—each element has an known chance for study
Random—each element has an equal chance for study
Stratified—study population divided into like groups
Nonprobability: element’s likelihood of study is unknown
Quota: population is grouped and elements are arbitrarily chosen
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22. The Marketing Research Process (cont’d)
Basic Survey Methods
Mail survey
Telephone survey
Online survey
Personal interview survey
In-home (door-to-door) interview
Focus-group interview
Telephone depth interview
Shopping mall intercept interviews
On-site computer interviews
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23. The Marketing Research Process (cont’d)
Questionnaire Construction
Open-ended question
Question which invites the respondent to answer as their own interests or personal subjectivity dictates
Dichotomous question
Question which to which the respondent can make only an either/or or yes/no response
Multiple-choice question
Question asks the respondent to choose a response from a fixed set of responses
Observation Methods
Experimentation
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24. Class Exercise
You are considering opening a new “fluff-and-fold” laundry pick‑up, cleaning, and delivery service for students. You are uncertain whether sufficient demand exists, and you have questions about when students will need your service most and what level of service they will require. You realize that marketing research can help solve your information needs. You must now answer these questions.
Define the problem.
Design the research project.
The objective of this class exercise is to apply the marketing research process to solving a marketing problem.
Question 1. The answers to this question will depend on how the students view the opportunity on your campus. Typical problem statements might include “We don’t know if a sizable, profitable market exists for Fluff‑and‑Fold,” or “We don’t know which dorms at what times offer good opportunities for our service.” You might suggest that focus groups could help define the problem more clearly.
Question 2. Most students will take the example and adapt it. However, you might push them further by asking, “Can you be any more specific about the target market? For instance, do you expect more underclassmen will use the service? More males or females?” Other typical hypotheses might involve service expectations (one‑day pick up and delivery) and daily operation issues (primary demand on weekends versus weekdays).
Question 3. This may be a good time to explain how a focus group can help resolve or clarify research problems. You may even want to set up a focus group discussion in class. After students have developed a few open‑ended questions (for example, “How much would you be willing to pay for Fluff‑and‑Fold service?”), you might want to allow time for students to gather from one another information related to the questions. You might also point out that inexpensive data collection such as focus groups or polling customers can ensure better marketing decisions.
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25. Class Exercise (cont’d)
After consulting secondary data, you decide to conduct an exploratory study with students in your classes. Develop open‑ended questions to ask students that will provide information regarding your hypotheses.
Having gained some insight into the problem, you are now ready to conduct a descriptive study. You decide to conduct a survey to further test your refined hypotheses. However, you have several decisions to make regarding this study.
What type of sampling approach (random, stratified, area, quota) will you use and why?
What survey method (mail, telephone, personal interview) will you use and why?
How will you construct the questionnaire? Develop open‑ended, dichotomous, or multiple‑choice questions that will test your hypotheses. Remember to remain impartial and inoffensive.
Question 4. Observation, combined with interviews, may be an efficient way to deter-mine what times students will need the service. However, observation alone will not assess true feelings or opinions.
In part a), perhaps the best way to select a sample is through the use of stratified sampling, especially if demand is likely to vary by classification (freshmen, etc.). The student directory should provide this information. However, quota sampling, which is nonprobabilistic, may suffice for exploratory research.
In part b), mail surveys may be the cheapest (because of campus mail) and may be suitable to the short surveys most students will develop. However, response rate may be low. Phone surveys might increase the response rate, but finding students at home may be problematic. Personal interviews conducted at central meeting points on campus might help overcome refusals but might also introduce interviewer and sample bias.
In part c), you may want to illustrate the problems associated with double‑barreled, leading, nonmutually exclusive, and exhaustive questions, among others. You might even have students collect data by using these questions.
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26. The Marketing Research Process (cont’d)
Observation (for Data Collection) Methods
Direct contact with subject is avoided to reduce possible awareness of observation process.
Physical conditions, subject actions, and demographics are noted.
Observations may be combined with same subject interviews.
Data gathered may be influenced by observer bias.
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27. Class Exercise
What is the most appropriate data collection method for each of these research questions?
How do consumers in South Dakota feel about Christmas shopping?
How do JC Penney customers feel about Penney’s customer service?
What is the opinion of U.S. consumers toward a Chrysler advertisement that questions the quality of Japanese cars?
How many people nationwide currently live in apartments?
How do Sears’ charge customers view that company’s new pricing policy?
This exercise is designed to prompt students to think about how to solve data collection problems. Students should discuss the merits of alternative data collection methods as they solve each problem. Obviously, each problem can be solved by more than one collection method. The students should decide which data collection procedure is best for each situation and be able to defend their choices.
Possible answers:
Telephone interviews or possibly focus‑group interviews
Mall intercept interviews
Telephone interviews
This information can be obtained most easily in a census report. However, if census information is too dated to be useful, the next best source might be the U.S. Department of Housing. Overall, this type of data is usually available in secondary form from government or industry sources.
A mail survey of Sears’ charge customers
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28. The Marketing Research Process (cont’d)
Experimentation
A research method that attempts to maintain (control) certain variables while measuring the effects of experimental (uncontrolled) variables
Independent variable: acts on the dependent variable
Dependent variable: is affected by variations in the independent variable
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29. Interpreting Research Findings
Statistical Interpretation
Analysis of survey data to determine what is typical or what deviates from the average that indicates:
How widely the responses vary
How the responses are distributed
Which hypotheses are supported
Which hypotheses are rejected
Whether construction errors have invalidated the survey’s results
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30. Interpreting Research Findings (cont’d)
Reporting Research Findings
Take an objective look at survey findings
Report deficiencies and reasons for deficiencies
Prepare a formal, written document
Summary and recommendations
Short, clear, and simply expressed for executives
Technical report
Contains more detailed information about research methods and procedures and important data gathered
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31. Marketing Information Systems
Using Technology to Improve Marketing Information Gathering and Analysis
Marketing Information Systems
Marketing Information System (MIS)
A framework for the management and structuring of information gathered regularly from sources inside and outside an organization
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32. Using Technology to Improve Marketing Information Gathering and Analysis (cont’d)
Databases
Database
A collection of information arranged for easy access and retrieval
Single-source data
Information provided by a single marketing research firm
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33. Marketing Decision Support Systems (MDSS)
Using Technology to Improve Marketing Information Gathering and Analysis (cont’d)
Marketing Decision Support Systems (MDSS)
Customized computer software that aids marketing managers in decision making
Capability to create market models based on changes in marketing variables
Artificial Intelligence (AI) assists in customer support
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34. The Internet and Online Information Services
Using Technology to Improve Marketing Information Gathering and Analysis (cont’d)
The Internet and Online Information Services
Ease of information dissemination
Ease of information accessibility (intranets)
Access to customer data (data mining websites)
Subscription information services on Web
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36. Issues in Marketing Research
The Importance of Ethical Marketing Research
Ethical questions affect:
The reliability of the research
The researcher–marketing manager relationship
The nature of marketing managers’ decisions
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38. Debate Issue
Does marketing research (surveys, telephone interviewing) invade a respondent’s privacy?
YES
·      A great deal of marketing research asks questions that are too personal.
·      Some marketing research, especially telephone and personal interviews, is nothing more than a disguise for sales presentations.
·      The information obtained from marketing research is often used to develop mailing lists that are used to sell consumers products that they may not want.
·     Sometimes the true nature of the re­search is disguised to get consumers to respond. NO
·      The right to privacy deals with an individual’s ability to restrict personal information.
·      Individual respondents must decide for themselves how much of their personal lives they will share with others.
·      What constitutes private information and public information is ultimately up to the individual respondent.
·     As long as the researcher obtains the consent of the respondent, the research does not invade the respondent’s privacy.
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39. Issues in Marketing Research (cont’d)
International Issues in Marketing Research
Modification of data-gathering methods to account for regional differences
Use of two-pronged approach to international marketing research
Detailed search for and analysis of secondary data
Field research to refine firm’s understanding of how local environment will shape/restrict data-gathering about customer needs and preferences
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40. JRA provides global marketing research services
Reprinted with permission of JRA, J. Reckner Associates, Inc.
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42. After reviewing this chapter you should:
Know the basic steps in conducting marketing research.
Be familiar with the fundamental methods of gathering data for marketing research.
Be able to describe the nature and role of information systems in marketing decision making.
Understand how such tools as databases, decision support systems, and the internet facilitate marketing research.
Be able to identify key ethical and international considerations in marketing research.
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43. Chapter Quiz
Marketing information systems and marketing research have changed rapidly because customers and companies around the world have been linked by
the computer.
the Internet.
the Interactive Network.
electronic online services.
telecommunications. B C
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44. Chapter Quiz (cont’d)
Dan was given the task of conducting a research project for his firm and proceeds with the following steps. He asks questions to determine the research topic, conducts a telephone survey, writes a report describing the survey results, and gives that report to his boss. Which step of the marketing research process has Dan omitted?
Collecting data
Defining and locating problems
Interpreting research
Designing the research project
Reporting research findings
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45. A study that is valid and reliable
Chapter Quiz (cont’d)
A study that is valid and reliable
is called a marketing research study.
measures what it is supposed to measure and produces almost identical results every time.
is expensive to implement and complete.
measures subtle differences in the population being studied.
is difficult to produce without expert researchers.
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46. Chapter Quiz (cont’d)
Chelsea, Ltd., a retail clothing store chain, wants to use observation methods to gather information about shopping behavior. Which of the following should Chelsea know about observation methods of data collection?
Observation uses secondary sources of data.
Observation depends on mall interviews.
Observation can tell Chelsea what is being done, but not why.
Observation focuses on open‑ended questions.
Observation works best for telephone surveys.
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