Chapter OneIntroduction to Marketing Research

Figure 1.1 Introduction to Marketing Research: An OverviewDefinition of Marketing ResearchFig. 1.2A Classification of Marketing ResearchMarketing Research ProcessFig 1.3Fig 1.4The Role of Marketing Research in Decision MakingFig 1.5The Information Value Chain for Marketing ResearchFig 1.6

Figure 1.1 Introduction to Marketing Research: An Overview (cont.)

Definition of Marketing ResearchMarketing research is the systematic and objective identification,collection,analysis,dissemination, anduse of information for the purpose of improving decision making related to the identification and solution of problems and opportunities in marketing.

Identification of Information NeededCollection of DataAnalysis of DataDissemination of InformationIdentifying and Solving Marketing ProblemsFigure 1.2 Defining Marketing ResearchUse of Information

Market ResearchSpecifies the information necessary to address these issuesManages and implements the data collection processAnalyzes the resultsCommunicates the findings and their implications

Classification of Marketing ResearchProblem Identification ResearchResearch undertaken to help identify problems which are not necessarily apparent on the surface and yet exist or are likely to arise in the future. Examples: market potential, market share, image, market characteristics, sales analysis, forecasting, and trends research.

Problem Solving ResearchResearch undertaken to help solve specific marketing problems. Examples: segmentation, product, pricing, promotion, and distribution research.

Problem Identification ResearchMarket Potential ResearchMarket Share ResearchImage ResearchMarket Characteristics ResearchForecasting ResearchBusiness Trends ResearchMarketing ResearchFigure 1.3 A Classification of Marketing ResearchProblem Solving ResearchSegmentation ResearchProduct ResearchPricing ResearchPromotion ResearchDistribution Research

Problem Solving Research Determine the basis of segmentation Establish market potential and responsiveness for various segments Select target markets Create lifestyle profiles: demography, media, and product image characteristicsSEGMENTATION RESEARCHTest concept Determine optimal product designPackage testsProduct modificationBrand positioning and repositioningTest marketingControl score tests PRODUCT RESEARCHTable 1.1

Problem Solving ResearchTable 1.1 (cont.)PRICING RESEARCH Pricing policies Importance of price in brand selection Product line pricing Price elasticity of demand Initiating and responding to price changesPROMOTIONAL RESEARCH Optimal promotional budget Sales promotion relationship Optimal promotional mix Copy decisions Media decisions Creative advertising testing Evaluation of advertising effectiveness Claim substantiation

Problem Solving ResearchDISTRIBUTION RESEARCHDetermine Types of distribution Attitudes of channel members Intensity of wholesale & resale coverage Channel margins Location of retail and wholesale outlets

Table 1.1 Problem Solving Research Segmentation Research

- determine basis of segmentation

- establish market potential and responsiveness for various segments

- select target markets and create lifestyle profiles for demography, media, and product image characteristics Product Research

- test concept

- determine optimal product design

- package tests

- product modification

- brand positioning and repositioning

- test marketing

- control store tests Problem Solving Research

Table 1.1 Problem Solving Research (Cont.)

Problem Solving Research (Cont.)

Pricing Research

-importance of price in brand selection

-pricing policies

-product line pricing

-price elasticity of demand

-initiating and responding to price changes

Problem Solving Research (Cont.)Promotional Research-optimal promotional budget-sales promotion relationship-optimal promotional mix-copy decisions-media decisions-creative advertising testing-claim substantiation-evaluation of advertising effectiveness

Table 1.1 Problem Solving Research (Cont.)

Problem Solving Research (Cont.)

Distribution Research

-determine type of distribution

-attitudes of channel members

-intensity of wholesale and retail coverage

-channel margins

-location of retail and wholesale outlets

Figure 1.4 The Marketing Research ProcessStep 1: Defining the ProblemStep 2: Developing an Approach to the ProblemStep 3: Formulating a Research DesignStep 4: Doing Field Work or Collecting DataStep 5: Preparing and Analyzing DataStep 6: Preparing and Presenting the Report

Uncontrollable Environmental FactorsEconomyTechnologyCompetitionLaws and RegulationSocial and Cultural FactorsPolitical FactorsAssessing Information NeedsCustomer Groups Consumers Employees Channel Members SuppliersMarketingResearchMarketing Managers Market Segmentation Marketing Programs Target Market Selection Performance and ControlControllable Marketing Variables Product Pricing Promotion Distribution

Marketing DecisionMaking

Providing InformationFigure 1.5 The Role of Marketing Research in Marketing Decision Making

Figure 1.6 The Information Value Chain

Data

Information

Data with structure

Knowledge

Information endowed

with meaning

Decision

Making

Processes

Outcomes

Implementing

Action

Expertise

in measurement

The Information Value Chain

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Figure 1.7 Marketing Research Industry: Supplier and ServicesResearch SuppliersInternalLimited ServiceFull ServiceExternalOther ServicesField ServicesCustomized ServicesSyndicated ServicesInternetServices

Marketing Research Suppliers & ServicesInternal suppliers External suppliers Full-service suppliers Syndicated servicesStandardized servicesCustomized servicesInternet services Limited-service suppliers Field servicesCoding and data entry services Analytical services Data analysis servicesBranded marketing research products

Criteria for Selecting a Research SupplierWhat is the reputation of the supplier?Do they complete projects on schedule? Are they known for maintaining ethical standards? Are they flexible? Are their research projects of high quality? What kind and how much experience does the supplier have? Has the firm had experience with projects similar to this one? Do the supplier's personnel have both technical and non-technical expertise? Can they communicate well with the client?

Competitive bids should be obtained and compared on the basis of quality as well as price.

Careers in Marketing ResearchCareer opportunities are available with marketing research firms (e.g., AC Nielsen, Burke, Inc., M/A/R/C)Careers in business and non-business firms and agencies with in-house marketing research departments (e.g., Procter & Gamble, Coca-Cola, AT & T, the Federal Trade Commission, United States Census Bureau)Advertising agencies (e.g., BBDO International, Ogilvy & Mather, J. Walter Thompson, Young & Rubicam) Positions: vice president of marketing research, research director, assistant director of research, project manager, field work director, statistician/data processing specialist, senior analyst, analyst, junior analyst, and operational supervisor.

Selected Marketing Research Career DescriptionsVice President of Marketing ResearchPart of companys top management teamDirects companys entire market research operationSets the goals & objectives of the marketing research departmentResearch DirectorAlso part of senior managementHeads the development and execution of all research projectsAssistant Director of ResearchAdministrative assistant to directorSupervises research staff membersSenior Project ManagerResponsible for design, implementation, & research projects

AnalystHandles details in execution of projectDesigns & pretests questionnairesConducts preliminary analysis of dataJunior AnalystSecondary data analysisEdits and codes questionnairesConducts preliminary analysis of dataFieldwork DirectorHandles selection, training, supervision, and evaluation of interviewers and field workersSenior AnalystParticipates in the development of projectsCarries out execution of assigned projectsCoordinates the efforts of analyst, junior analyst, & other personnel in the development of research design and data collectionPrepares final reportStatistician/Data ProcessingServes as expert on theory and application on statistical techniquesOversees experimental design, data processing, and analysis Selected Marketing Research Career Descriptions

Preparation for a Career in Marketing ResearchTake all the marketing courses you can.Take courses in statistics and quantitative methods.Acquire Internet and computer skills. Knowledge of programming languages is an added asset.Take courses in psychology and consumer behavior.Acquire effective written and verbal communication skills.Think creatively. Creativity and common sense command a premium in marketing research.

Expert SystemsInternal Billing,Production, and Other RecordsDecision SupportSystemsMarketingInformation SystemsFigure 1.8 The Development of MIS and DSS=External Market Information+

MISStructured problemsUse of reportsInformation displaying restrictedCan improve decision making by clarifying new dataFigure 1.9 Marketing Information Systems (MIS) vs. Decision Support Systems (DSS)Figure 1.9 Marketing Information Systems (MIS) vs. Decision Support Systems (DSS)DSSUnstructured problemsUse of modelsAdaptability

Can improve decision making by using what if analysis

Figure 1.10 Stakeholders in Marketing Research: An Ethical PerspectiveClientMarketingResearcherPublicRespondents

Marketing Research Associations OnlineDomesticAAPOR: American Association for Public Opinion Research (www.aapor.org)AMA: American Marketing Association (www.ama.org)ARF: The Advertising Research Foundation (www.amic.com/arf)CASRO: The Council of American Survey Research Organizations (www.casro.org)MRA: Marketing Research Association (www.mra-net.org)QRCA: Qualitative Research Consultants Association (www.qrca.org)RIC: Research Industry Coalition (www.research industry.org)