Marketing Research 3. 4-2 Professor Takada ROAD MAP: Previewing the Concepts Importance of...

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Marketing ResearchMarketing Research

Professor TakadaProfessor Takada4-2

ROAD MAP: Previewing the Concepts

• Importance of information to the Importance of information to the company and its understanding of the company and its understanding of the marketplacemarketplace

• Marketing information systemMarketing information system

• Marketing researchMarketing research

• How companies analyze and distribute How companies analyze and distribute marketing information.marketing information.

• Special issues some marketing Special issues some marketing researchers face:researchers face:– public policy and ethics issues.public policy and ethics issues.

ROAD MAP

• Marketing research processMarketing research process

The Importance of Information

• Companies need Companies need information about information about their:their:– Customer needsCustomer needs– Marketing environmentMarketing environment– CompetitionCompetition

• Marketing managers Marketing managers do not need do not need moremore information, they information, they need need betterbetter information.information.

Information Overload

“In this oh so overwhelming information age, it’s all too easy to be buried, burdened, and burned out by data overload.”

ROAD MAP

The Marketing Information System

Marketing Information System

• An MIS consists of people, equipment, An MIS consists of people, equipment, and procedures to gather, sort, analyze, and procedures to gather, sort, analyze, evaluate, and distribute needed, timely, evaluate, and distribute needed, timely, and accurate information to marketing and accurate information to marketing decision makers.decision makers.

• The MIS helps managers to: The MIS helps managers to: 1.1. Assess Information NeedsAssess Information Needs2.2. Develop Needed InformationDevelop Needed Information3.3. Distribute InformationDistribute Information

Assessing Information Needs

• A good MIS balances the information A good MIS balances the information users would users would likelike against what they really against what they really needneed and what is and what is feasiblefeasible to offer. to offer.

• Sometimes the company cannot provide Sometimes the company cannot provide the needed information because it is not the needed information because it is not available or due to MIS limitations.available or due to MIS limitations.

• Have to decide whether the benefits of Have to decide whether the benefits of more information are worth the costs.more information are worth the costs.

Developing Marketing Information

• Internal DatabasesInternal Databases: Electronic collections : Electronic collections of information obtained from data sources of information obtained from data sources within the company.within the company.

• Marketing IntelligenceMarketing Intelligence: Systematic : Systematic collection and analysis of publicly available collection and analysis of publicly available information about competitors and information about competitors and developments in the marketing developments in the marketing environment.environment.

• Marketing ResearchMarketing Research: Systematic design, : Systematic design, collection, analysis, and reporting of data collection, analysis, and reporting of data relevant to a specific marketing situation relevant to a specific marketing situation facing an organization.facing an organization.

ROAD MAP

• Marketing researchMarketing research

Marketing Research Defined

Systematic design, collection,

analysis, and reporting of data

and findings relevant to a specific

marketing situation facing a company.

The Marketing Research Process

The Problem Definition and Approach Development Process

Tasks Involved

Qualitative Research

Discussions with Decision Makers

Interviews withExperts

Secondary DataAnalysis

Environmental Context of the Problem

Step 1: Problem Definition

Management Decision Problem

Marketing Research Problem

Step 2: Approach to the Problem

Step 3: Research Design

ResearchQuestions and Hypotheses

Analytical Framework and Models

Specification of

Information Needed

Underlying Causes

• Superior Promotion by Competition

• Inadequate Distribution of Company’s Products

• Lower Product Quality

• Price Undercutting by a Major Competitor

Focus of the DM Focus of the Researcher

Discussion

Discussion Between the Researcher and the DM

Symptoms

• Loss of Market Share

Research Design

Exploratory ResearchDesign

Causal Research

Conclusive ResearchDesign

Cross-SectionalDesign

Descriptive Research

LongitudinalDesign

A Classification of Market Research Designs

Marketing Research Designs

Gather preliminary information that will help define the problem

and suggest hypotheses.

Exploratory Research

Descriptive Research

Causal Research

Describes things (e.g., market potential for a product,

Demographics, and attitudes).

Tests hypotheses about cause-and-effect

relationships.

•Secondary Data Analysis

•Focus Groups

Conclusive Research•Descriptive/Causal

•Secondary Data Analysis

•Focus Groups

Conclusive Research•Descriptive/Causal

Some Alternative Research Designs

Focus Group in Session

Developing the Research Plan

• Includes:Includes:– Determining the exact information neededDetermining the exact information needed– Developing a plan for gathering it Developing a plan for gathering it

efficientlyefficiently– Presenting the written plan to managementPresenting the written plan to management

• Outlines:Outlines:– Sources of existing dataSources of existing data– Specific research approachesSpecific research approaches– Contact methodsContact methods– Sampling plansSampling plans– Instruments for data collectionInstruments for data collection

A Classification of Marketing Research Data

Marketing Research Data

SecondaryData

PrimaryData

QuantitativeData

QualitativeData

Causal Descriptive

SurveyData

Observationaland Other Data

ExperimentalData

A Classification of Secondary Data

Secondary Data

Internal

Requires Further

Processing

Ready to Use

Published Materials

Computerized Databases

SyndicatedServices

External

Gathering Secondary Data

• Information that already exists Information that already exists somewheresomewhere– Internal databasesInternal databases– Commercial data servicesCommercial data services– Government sourcesGovernment sources

• Available more quickly and at a lower Available more quickly and at a lower cost than primary datacost than primary data

• Must be relevant, accurate, current, Must be relevant, accurate, current, and impartialand impartial

Primary Data Collection

• Consists of information collected for Consists of information collected for the specific purpose at hand.the specific purpose at hand.

• Must be relevant, accurate, current, Must be relevant, accurate, current, and unbiased.and unbiased.

• Must determine:Must determine:– Research approachResearch approach– Contact methodsContact methods– Sampling planSampling plan– Research instrumentsResearch instruments

Primary Data Collection

Mechanical Devices

• People Meters• Supermarket Scanners• Galvanometer• Eye Cameras

Questionnaires

• What questions to ask• Form of each question

•Closed-ended•Open-ended

• Wording• Ordering

Research Instruments

A Comparison of Primary and Secondary Data

__________________________________________________________________________

PRIMARY DATA SECONDARY DATA

________________________________________________________________

Collection purpose For the problem at hand For other problems

Collection process Very involved Rapid and easy

Collection cost High Relatively low

Collection time Long Short

______________________________________________________________________

A Comparison of Primary and Secondary Data

Quantitative Descriptive Research

Methods of Obtaining Quantitative Data in Descriptive Research

SURVEYInformation Obtained

by Questioning Respondents

OBSERVATIONInformation Obtained by Observing Behavior

orPhenomena

Survey Research

• Most widely used method for primary Most widely used method for primary data collection.data collection.

• Approach best suited for gathering Approach best suited for gathering descriptive information.descriptive information.

• Can gather information about Can gather information about people’s knowledge, attitudes, people’s knowledge, attitudes, preferences, or buying behavior.preferences, or buying behavior.

Strengths & Weaknesses ofContact Methods

• Avoid negativesAvoid negatives

• Avoid hypotheticalsAvoid hypotheticals

• Avoid words that Avoid words that could be misheardcould be misheard

• Use mutually Use mutually exclusive categoriesexclusive categories

• Allow for “other” in Allow for “other” in fixed response fixed response questionsquestions

Questionnaire Do’s and Don’ts

•Ensure questions are Ensure questions are free of biasfree of bias

•Make questions simpleMake questions simple

•Make questions Make questions specificspecific

•Avoid jargonAvoid jargon

•Avoid sophisticated Avoid sophisticated wordswords

•Avoid ambiguous Avoid ambiguous wordswords

Question Types - Dichotomous

In arranging this trip, did you contact American Airlines?

Yes No

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

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

Strongly agree

Question Types – Semantic Differential

American Airlines

Large ………………………………...…………….Small

Experienced………………….………….Inexperienced

Modern………………………..………….Old-fashioned

Question Types – Importance Scale

Airline food service is _____ to me.

Extremely important

Very important

Somewhat important

Not very important

Not at all important

Question Types – Rating Scale

American Airlines’ food service is _____.

Excellent

Very good

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

Question Types –Completely Unstructured

What is your opinion of American Airlines?

Question Types –Word Association

What is the first word that comes to your mind when you hear the following?

Airline ________________________

American _____________________

Travel ________________________

Question Types –Sentence Completion

When I choose an airline, the most important consideration in my decision is: ________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________.

Question Types –Story Completion

“I flew American 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. ________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

Question Types –Picture (Empty Balloons)

Question Types – Thematic Apperception Test

Make up a story that reflects what you think is happening in this picture.

Observational Research

• The gathering of primary data by The gathering of primary data by observing relevant people, actions, observing relevant people, actions, and situations.and situations.

• Ethnographic research:Ethnographic research:– Observation in “natural environment”Observation in “natural environment”

• Mechanical observation:Mechanical observation:– People metersPeople meters– Checkout scannersCheckout scanners

Observational Research

Fisher-Price set up an observation lab in which it could observe the reactions of little tots to new toys.

Experimentation as Conclusive Research

ConclusiveResearch

DescriptiveCausal

Experimentation

Field Experiments

LaboratoryExperiments

Experimental Research

• Tries to explain cause-and-effect Tries to explain cause-and-effect relationships.relationships.

• Involves:Involves:– selecting matched groups of subjects, selecting matched groups of subjects, – giving different treatments, giving different treatments, – controlling unrelated factors, and controlling unrelated factors, and – checking differences in group responses.checking differences in group responses.

Choosing the Sample

• SampleSample – segment of – segment of the population selected the population selected to represent the to represent the population as a whole.population as a whole.

• Requires 3 Requires 3 Decisions:Decisions:– Who is to be Who is to be

surveyed?surveyed?• Sampling unit Sampling unit

– How many people How many people should be surveyed?should be surveyed?• Sample sizeSample size

– How should the How should the people in the sample people in the sample be chosen?be chosen?• Sampling procedureSampling procedure

Types of Samples

ProbabilityProbability

• Simple randomSimple random

• Stratified Stratified randomrandom

• ClusterCluster

NonprobabilityNonprobability

• ConvenienceConvenience

• JudgmentJudgment

• QuotaQuota

Collecting the Data

Processing theData

Analyzing theData

Research Plan

Implementing the Research Plan

Interpreting & Reporting Findings

Managers and researchers must work together when interpreting research results.

Step 1. Interpret the Findings

Step 2. Draw Conclusions

Step 3. Report to Management

Characteristics of Good Marketing Research

Scientific method Research creativity Multiple methods Interdependence Value and cost of information Healthy skepticism Ethical marketing

Tools to Measure Marketing Plan Performance

Sales Analysis

Financial Analysis

Expense-to-SalesAnalysis

Market ShareAnalysis

Market Share Analysis

• Overall market shareOverall market share

• Relative market shareRelative market share

The Control-Chart Model

Simplified Profit-and-Loss Statement

The Measures of Market Demand

PotentialMarket

PenetratedMarket

TargetMarket

AvailableMarket

Ninety Types of Demand Measurement

Market Demand Functions

Estimating Current Demand

• Total market potentialTotal market potential

• Area market potentialArea market potential– Market buildup methodMarket buildup method– Multiple-factor index methodMultiple-factor index method

•Brand development indexBrand development index

Calculating Brand Development Index

Estimating Future Demand

• Survey of Buyers’ IntentionsSurvey of Buyers’ Intentions

• Composite of Sales Force OpinionsComposite of Sales Force Opinions

• Expert OpinionExpert Opinion

• Past-Sales AnalysisPast-Sales Analysis

• Market-Test MethodMarket-Test Method

Purchase Probability ScaleDo you intend to buy an automobile within the next 6 months?

0.00 No

0.20 Slight possibility

0.40 Fair possibility

0.60 Good possibility

0.80 High possibility

1.00 Certain

ROAD MAP

Customer Relationship Management

• Many companies utilize CRMMany companies utilize CRM– Capture customer information from all sourcesCapture customer information from all sources– Analyze it in depthAnalyze it in depth– Apply the results to build stronger relationships.Apply the results to build stronger relationships.

• Companies look for customer Companies look for customer touch pointstouch points..

• CRM analysts develop CRM analysts develop data warehousesdata warehouses and and use use data miningdata mining techniques to find techniques to find information out about customers.information out about customers.

Distributing and Using Marketing Information

Information Must be Distributed to the Right People at the Right Time

Routine Information for Decision Making

Nonroutine Information for Special Situations

Intranets Extranets

ROAD MAP: Previewing the Concepts

Other Marketing Research Considerations

Marketing Research in Small Businesses and NonprofitOrganizations

International Marketing ResearchInternational Marketing Research

Public Policy and Ethics in Marketing ResearchPublic Policy and Ethics in Marketing Research

Research Services

Roper ASW, Inc. provides companies with information resources “from Brazil to Eastern Europe; from Cape Town to Beijing—if you are there, Roper ASW, Inc. is there.”

Click Here to Visit RoperASW

Top 25 Global Research Organizations

Organization

Headquarters

Parent company

Global research Revenues1

(US$ millions)

Percent of global

revenues from outside home

country 1 1 AC Nielsen Corp. Stamford, Conn. U.S. $1,577.0 67.0% 2 2 IMS Health Inc. Westport, Conn. U.S. 1,131.2 62.5 3 3 The Kantar Group Fairfield, Conn. U.K. 928.5 71.4 4 4 Taylor Nelson Sofres plc London U.K. 709.6 75.2 5 5 Information Resources Inc. Chicago U.S. 531.9 25.0 6 — VNU Inc. New York U.S. 526.9 2.6 7 6 NFO WorldGroup Inc. Greenwich, Conn. U.S. 470.5 62.4 8 8 GfK Group Nuremberg Germany 444.0 62.4 9 10 Ipsos Group SA Paris France 304.2 78.3

10 11 Westat Inc. Rockville, Md. U.S. 264.4 0.0 11 9 NOP World London U.K. 246.1 60.0 12 14 Aegis Research London U.K. 232.2 32.2 13 12 Arbitron Inc. New York U.S. 206.8 3.4 14 15 Video Research Ltd. Tokyo Japan 174.3* 0.0 15 13 Maritz Research St. Louis U.S. 172.0 31.5 16 16 The NPD Group Inc. Port Washington, N.Y. U.S. 164.3 17.0 17 18 Opinion Research Corp. Princeton, N.J. U.S. 123.9 28.9 18 17 INTAGE Inc. Tokyo Japan 119.3* 1.8* 19 19 J.D. Power and Associates Agoura Hills, Calif. U.S. 104.0 15.4 20 20 Roper Starch Worldwide Inc. Harrison, N.Y. U.S. 73.9 14.3 21 — Jupiter Media Metrix Inc. New York U.S. 69.1 15.0 22 21 Dentsu Research Inc. Tokyo Japan 67.6 0.3 23 25 IBOPE Group Rio de Janeiro Brazil 60.7 31.8 24 — Harris Interactive Inc. Rochester, N.Y. U.S. 56.0 5.4 25 — MORPACE International Inc. Farmington Hills, Mich. U.S. 54.3 26.1

$8,812.7

1Total revenues that include nonresearch activities for some companies are significantly higher. * For fiscal year ending March 31, 2001.

A Sample of Marketing Research Jobs

Rest Stop: Reviewing the Concepts

• Explain the importance of information to the Explain the importance of information to the company.company.

• Define the marketing information system and Define the marketing information system and discuss its parts.discuss its parts.

• Outline the steps in the marketing research Outline the steps in the marketing research process.process.

• Explain how companies analyze and Explain how companies analyze and distribute marketing information.distribute marketing information.

• Discuss the special issues some marketing Discuss the special issues some marketing researchers face, including public policy and researchers face, including public policy and ethics issues.ethics issues.

Marketing Research 3. 4-2 Professor Takada ROAD MAP: Previewing the Concepts Importance of...

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