The Consumer Research Process

Marc Wachtfogel, Ph.D.

Consumer Behavior

Chapter 2

Learning Objectives

1. To Understand the Importance of Consumer Research for Firms and Their Brands, as Well as Consumers.

2. To Articulate the Steps in the Consumer Research Process.

3. To Explain the Importance of Establishing Specific Research Objectives as the First Step in the Design of a Consumer Research Project.

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Note: Digital Marketing, Data & Analytics will be covered in a different section.

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Dare To Be

Different!

Market research is often needed to ensure that we produce what customers really want and not what

we think they want.

The primary goal of consumer research is to produceknowledge about consumer behavior (Calder & Tybout, 1987).

Photo: AOL

The Trends Report

External and internal factors contribute to the formulation of self-concept and lifestyle, which affects the consumer decision process. During this process, experiences and acquisitions update the original external and internal influences.

The Consumer Value Framework (CVF) Babin & Harris

Why Do Marketers Regularly Test Print Ads Like This Before They Are Placed in the Media?

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To Test the Impact of the Message Before Spending Large Amounts of Money

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Four out of every five new products will fail in the marketplace.

The Importance of the Consumer Research Process

• Marketers must understand customers to design effective:– marketing strategies– products– promotional messages

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One of the biggest mistakes people make in business is spending money on product development BEFORE test marketing the idea. Testing your product/service idea is your key to success in marketing.

The Consumer Research ProcessFigure 2.2

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Developing Research Objectives

• It is extremely important that research objectives are determined at the beginning of the process.

• Defining purposes and objectives helps ensure an appropriate research design.

• A written statement of objectives helps to define the type and level of information needed.

• Without this agreed-upon roadmap for the research, money can easily be wasted and research objectives not fulfilled.

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Discussion Questions

• Assume you are planning to open a new pizza restaurant near campus. – What are three objectives of your research plan

for your new business?– How would you gather the data?

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The Consumer Research Process

Marketing researchMarketing research: – Market research methods fall into two categories –

Primary and Secondary Research– Primary research is gathered to answer a specific

marketing question- You are gathering the data- Varies based on the problem you are solving

– Secondary research is already gathered for some other purpose

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Primary Research Techniques

What do customers think of a new version of a popular product?• To collect primary data a business must carry out field research. The main

methods of field research are:• Product Tests• Ethnographic Tests (i.e. observational)• Face-to-face interviews • Telephone interviews • Online surveys• Questionnaires• Focus groups and consumer panels – a small group of people meet

together with a “facilitator” who asks the panel to examine a product and then asks in depth questions. This method is often used when a business is planning to introduce a new product or brand name.

In most cases it is not possible to ask all existing or potential customers - So primary research makes use of surveys and sampling to obtain valid results.

What are some of the advantages of using primary research?

What are the disadvantages?

Advantages and Disadvantages of Primary Research

The main advantages of primary research and data are that it is:• Up to date.• Specific to the purpose – asks the questions the business wants answers to.• Collects data which no other business will have access to (the results are

confidential).• In the case of online surveys and telephone interviews, the data can be obtained

quite quickly (think about how quickly political opinion polls come out).

The main disadvantages of primary research are that it:• Can be difficult to collect and/or take a long time to collect.• Is expensive to collect.• May provide mis-leading results if the sample is not large enough or chosen with

care; or if the questionnaire questions are not worded properly.

What is the difference between qualitative and quantitative market research?

Quantitative v. Qualitative Market Research

Quantitative Research:• By definition, measurement must be objective, quantitative and statistically valid.

Simply put, it's about numbers, objective hard data.– A scientifically calculated sample of people from a population is asked a set of

questions on a survey to determine the frequency and percentage of their responses.

Qualitative Research:• Qualitative research, is much more subjective than quantitative research and uses

very different methods of collecting information, mainly individual, in-depth interviews and focus groups. The nature of this type of research is exploratory and open-ended.– Participants are asked to respond to general questions, and the interviewer or group

moderator probes and explores their responses to identify and define peoples' perceptions, opinions and feelings.

Marketing Research - Qualitative and Quantitative Approaches (Examples: focus groups and surveys)

What is a Focus Group? • A qualitative research tool• Focus groups are "small group discussions, addressing a

specific topic, which usually involve 6-12 participants, either matched or varied on specific characteristics of interest to the researcher". (Fern, 1982; Morgan & Spanish, 1984).

• Focus groups require skilled facilitators or moderators to guide the discussion and maintain the focus. They are found to be most effective for learning about opinions and attitudes, pilot testing materials for assessments and generating recommendations.

Focus Group For Advertisement

What did you think? Did it work well?

Focus Groups

ADVANTAGES: ▪ Relatively easy to assemble, inexpensive and flexible in terms of format, ▪ Open recording allows participants to confirm their contributions ▪ Provide rich data through direct interaction▪ Spontaneous, participants not required to answer every question; able to build on one

another's responses;

LIMITATIONS: ▪ Findings may not represent the views of larger segments ▪ Requires good facilitation skills, including ability to handle various roles people may play

(“expert”, “quiet”, “outsider’, “friend”) ▪ Tough rich, data may be difficult to analyze because it is unstructured ▪ Possible conformance, censoring, conflict avoidance, or other unintended outcomes of the

group process need to be addressed as part of the data analysis (Carey, 1995)

Marketing Research – Surveys Quantitative Analytics

Surveys – descriptive.• Why is consumption falling?• Who are the consumers of our brand?• What do they think about it?• When do they use it?• How do they use it?

Question typesQuestion types:– Scalar questionsScalar questions: answered by some sort of scale

• “On a scale of 1 to 5, how do you like this book?”– Dichotomous questionsDichotomous questions: only two possible choices

• “Have you shopped here before?”– Categorical questionsCategorical questions: answered by selecting the category

• “What is your ethnicity?”– Open-ended questionsOpen-ended questions: allows respondents to express themselves

Surveys

Advantages:• Surveys are relatively inexpensive (especially self-administered surveys). • Surveys are useful in describing the characteristics of a large population. No

other method of observation can provide this general capability.• They can be administered from remote locations using mail, email or telephone.Limitations:• A methodology relying on standardization forces the researcher to develop

general questions• Surveys are inflexible in that they require the initial study design (the tool and

administration of the tool) to remain unchanged throughout the data collection. • The researcher must ensure that a large number of the selected sample will

reply.

Survey Bias

• Surveys, as any kind of research, are vulnerable to bias.

• The wording of a question can influence the outcome a great deal.

• For example, more people answered no to the question, should speeches against democracy be allowed, than answered yes to the question should speeches against democracy be forbidden.

Discussion QuestionsPersonal Privacy

• Many people do not like the fact that their personal data are used for marketing.

• How can marketers justify their need for data?

• How can they acquire data and maintain customer privacy?

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Discussion Guides for Research

• Discussion guides are an important part of focus groups and depth interview.

• They provide an agenda for the session and help ensure that the researcher’s objectives that were established for the research plan are met.

• Some interviewers follow the guide exactly, but most will “go with the flow” and let the participants partly drive the direction of the research.

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Focus Group Discussion Guide - Figure 2.4

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Qualitative Collection Method Projective Techniques

• Research procedures designed to identify consumers’ subconscious feelings and underlying motivations

• Consist of a variety of disguised “tests”

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Common Projective ExercisesTable 2.1 (excerpt)

Description

Word Associations

The researcher has a list of words, some of them to be studied and some just as “filler.” The researcher asks the respondent(s) to react, one-at-a time, to each word by stating or (in a focus group setting) writing on a pad the first word that comes to mind, and to explain the link.

SentenceCompletion

The researcher has a series of incomplete sentences that the respondent(s) needs to complete with a word or phrase.

Photo/Visual for Storytelling

The researcher creates/selects a series of photos of consumers, different brands or products, range of print ads, etc., to serve as stimuli. The respondents are asked to discuss or tell a story based on their response to a photo or some other visual stimulus.

Role Playing Is quite similar to storytelling; however, instead of telling a story, the participant(s) will be given a situation and asked to “act out” the role(s), often with regard to a product or brand, or particular selling situation.

Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 31Chapter Two Slide

Qualitative Collection Method Metaphor Analysis

• Based on belief that metaphors are the most basic method of thought and communication

• Zaltman Metaphor Elicitation Technique (ZMET) combines collage research and metaphor analysis to bring to the surface the mental models and the major themes or constructs that drive consumer thinking and behavior.

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Qualitative Collection Method “Looking-In”

• Look at information from threads and postings on social media.

• Methodology to capture consumers’ experiences, opinions, forecasts, needs, and interests

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Data Collection Methods Table 2.2

Mail Telephone Personal Interview

Online

Cost Low Moderate High Low

Speed Slow Immediate Slow Fast

Response rate Low Moderate High Self-selected

Geographic flexibility

Excellent Good Difficult Excellent

Interviewer bias

N/A Moderate Problematic N/A

Interviewer Supervision

N/A Easy Difficult N/A

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Validity and Reliability

It is important for research to be both valid and reliable. • It is only with these two characteristics that you can ensure that the data you have collected is useful for the purpose and can be expanded from the sample to the population

•Validity asks the question of whether the data is really applying to the objectives you have set.

•Reliability tells you, the researcher, if the results would be repeated if conducted on a similar group at the same time.

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Sampling and Data Collection

• Samples are a subset of the population used to estimate characteristics of the entire population.

• A sampling plan addresses:– Whom to survey– How many to survey– How to select them

• Researcher must choose probability or nonprobabililty sample.

Chapter Two Slide 36

Data Analysis and Reporting Findings

• Open-ended questions are coded and quantified.• All responses are tabulated and analyzed.• Final report includes executive summary, body,

tables, and graphs.

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Types of Secondary Data

Internal Data• Data generated in-house• May include analysis of

customer files• Useful for calculating

customer lifetime value

External Data• Data collected by an outside

organization• Includes federal

government, periodicals, newspapers, books, search engines

• Commercial data is also available from market research firms

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Customer Satisfaction Measurement

• Customer Satisfaction Surveys– Analysis of Expectations

versus Experience

• Mystery Shoppers• Customer Complaint

Analysis

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Probing Options for InterviewsFigure 2.3

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Attitude Scales

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Marketing Research –Surveys Quantitative Analytics

Surveys – descriptive.• Why is consumption falling?• Who are the consumers of our brand?• What do they think about it?• When do they use it?• How do they use it?

Question typesQuestion types:– Scalar questionsScalar questions: answered by some sort of scale

• “On a scale of 1 to 5, how do you like this book?”– Dichotomous questionsDichotomous questions: only two possible choices

• “Have you shopped here before?”– Categorical questionsCategorical questions: answered by selecting the category

• “What is your ethnicity?”– Open-ended questionsOpen-ended questions: allows respondents to express themselves

Marketing guru Seth Godin spells out why, when it comes to getting our attention, bad or bizarre ideas are more successful than boring ones.

Case Study

• Neutrogena is a manufacturer of personal care products for young adults, The company would like to extend its facial cleansers product line. Design (1) a qualitative and (2) a quantitative research design for the company focused on this objective.

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In Schwartz's estimation, choice has made us not freer but more paralyzed, not happier but more

dissatisfied.

Does more choice lead to more freedom?