2 Marketing“ The 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.”McDaniel & Gates
3 What is Research?Investigation or experimentation aimed at the discovery and interpretation of facts
4 What is Marketing Research? “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
5 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?
6 Why Should Organizations Spend Money on Market Research?
7 “TO GUESS IS CHEAP, TO GUESS WRONGLY IS EXPENSIVE” Chinese proverbMarketing research is an investment that produces a return on investment by reducing the possibility of failure and enhancing the success of marketing strategies and decision-making. In a word it reduces risk.
8 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?
9 What sort of decisions does management face that require information (i.e. Marketing research) ProductPricePromotionPlace
10 What Qualities of the data will be relevant to marketing decision making? ccurateelevantimely
11 What are the Two main types of information? Qualitative“How do people feel about the your product?”Not predictive of market behaviorQualify needs, wants, preferencesFocus Groups, In-depth interviewsEthnography, observational studiesQuantitative“How many people like your product?”Predictive if done correctlySurveys: Telephone, Mail, Intercept, Internet
12 What are Two main sources of information? Secondary ResearchExisting studies, census data, articlesInternet, library, trade journalsNon-specific and often datedPrimary Researchdata originated specifically for the study at handCreate your own questions and find your own answers by asking people what they think, feel, know, etc.Common methods include:Focus groups, surveys
13 What are the Major Sources of Information? Marketing ResearchCustomer DatabasesInternal Reporting Systems/ Scanner DataThe Internet / On-line Sources
15 Exploratory ResearchInitial research conducted to clarify and define the nature of a problemDoes not provide conclusive evidenceHelps develop hypotheses but does not test themSubsequent research expectedPublished sources, depth interviews, focus groupscharacterized by its flexibility
16 Descriptive ResearchDescribes characteristics of a population or phenomenon (who, what, where, when, why, and how)Some understanding of the nature of the problemTends to be more quantitative than qualitativeTests hypotheses and provides conclusive informationmore rigid than exploratory research
17 Causal ResearchConducted to identify cause and effect relationships, especially to see how actions now will affect a business in the futureaccomplishes goal through laboratory and field experimentsFor example, if Kellogg’s wants to know what impact on sales a change in package design would have.Stores are matched in terms of demographics, location etc. with only the packaging changed.Following the research, marketing managers will be able to decide whether changing the package design would be profitable.
18 (Problem Clearly Defined) Uncertainty Influences The Type Of ResearchCAUSAL ORDESCRIPTIVEEXPLORATORYABSOLUTE AMBIGUITYCOMPLETELY CERTAINExploratory 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 ofour products in a new package?“Which of two advertising campaigns is more effective?”
19 Determining When to Conduct Marketing Research Do we really need research?Expensive. Valuable?Benefits versus costsNature of the decisionVital?When should we NOT conduct research:No time or moneyInsufficient paybackInformation already availableInformation too hard to get
20 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 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?
21 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 changed little since the last major design change in 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?19922009
22 The Marketing Research Process Problem identificationspecifying what information is required – define research objectives (hypothesis driven)designing the method for collecting information (, exploratory, survey, observation, secondary, experiment)Select samplemanaging and implementing the collection of dataPreparing, analyzing and interpreting the datacommunicating the findings and their implications.
23 1. Define the problem or opportunity What is the purpose of the study?What is the relevant background information?Problem definition involves discussion with the decision makers, analysis of secondary data, perhaps, some exploratory researchOnce the problem has been precisely defined, the research can be designed and conducted properlyA decline in sales is a problem, but its underlying cause is what must be correctedTo define the problem, list every factor that may have influenced it, then eliminate any that cannot be measured
24 2. specifying what information is required Ascertain the decision maker’s objectivesDetermine unit of analysisUnderstand background of the problemDetermine relevant variablesIsolate/identify the problem, not the symptomsState research questions and objectives
25 3. Determine Research Design Exploratory:Initial, unstructured, informalWhen you don’t know muchFocus groups, lit review, case study, pilot study, secondary data, experience surveyDescriptive:Answers who, what, why and howSurveys, observationCausal:Relationships between variablesExperiments
26 4. Select Sample Subjects Identify target population Census = allSample = portionIdentify target populationCost vs. generalizabilityIdentify unit of analysisIndividual, household, communityHow will you select subjects?Probability vs. nonprobability
27 5. Collect Data Determine data gathering methods Properly prepare Secondary data:Internal records, reports for purchase, library, webPrimary data:Telephone, web, in person, mail, observation (in person, electronic)Properly preparePretest, pilot test, main study
28 6. Analyze Data Edit data Code data Select appropriate analysis method Use to summarize findingsUse to interpret resultsWill the findings hold for the general population?
29 7. Prepare Report SUMMARY: What was done and what was found Goal: clear, unbiased conclusionsWrite for your audience
30 The Marketing Research Process Problem DiscoverySelection of Sample DesignExploratory ResearchCollection of the DataSelection of the Basic Research Method
31 The Research Process (cont.) Editing and CodingReportData ProcessingInterpretation of the Findings
32 Would you talk only to men? Would you talk only to current owners?Would you talk to only 10 people?Would it matter if you asked them about the Cadillac Escalade?Would it matter if you did a multiple regression analysis?
33 Marketing research works because, by talking to a relatively small number of people, it is possible to find out about a far larger number.But…..it only works if you talk to the right number of peopleit only works if you talk to the right type of peopleit only works if you ask the right questions andit only works if you analyze the data in the right way.
34 Research Ethics No harm Full disclosure No coercion The moral principals and values that govern actions and decisions. They are guidelines on how to act when faced with moral dilemmas.No harmConfidential or Anonymous?Full disclosureBefore and after (debriefing)No deception (passive or active)No coercionRight of refusalIdentity protectionAnonymity or confidentiality
35 “The formulation of the problem is often more essential than its solution” Albert Einstein
36 The Management Problem versus the Marketing Research Problem A distinction must be made between the management problem and the marketing research problem.Marketing ResearchProblemsManagement ProblemFocus on symptomsAction orientedFocus on causesData oriented