Master of Business Administration - MBA Semester 3

MK0013– Marketing Research - 4 Credits

Book ID: B1223

Assignment Set- 2 (60 Marks)

Note: Each question carries 10 Marks. Answer all the questions.

Q.1 What are the nature, scope and features of Marketing Research?

Ans-Nature of Marketing Research

We have already discussed that MR is systematic and objective in nature. Apart from these, the main characteristic features that characterize the nature of MR are:

Applied/Problem solving research

Often based on cost-benefit analysis

Vital for implementation of marketing concept

Value of information declines with time

Dynamic (ongoing)

Marketing research is one of the principal tools for answering questions because it:

Links the consumer, customer, and public to the market through information used to identify and define marketing

Generates, refines, and evaluates marketing actions

Monitors marketing performance

Underlines the understanding of marketing as a process

Scope of Marketing Research

Marketing research provides the right information at the right time in the right place and to the right person which is important in decision-making. It helps the decision maker in various ways. Analysing it, you will find two major reasons

1. The Increased Complexity of Business Environment: The study of complexity of business environment can be studied in four parts:

Technology changes

Research and development

Product changes

Information technology changes

The Technological Changes: The technological changes consist of factors related to knowledge applied and the materials and machined uses in the production of goods and services. These changes have an impact on the business of an organisation. In India, we know that the state of technological development varies among different sectors of the industry.

Research and Development: The breathtaking rate of technology change racing through all types of industry is due in large part to increasing expenditures for research and development. Despite the engagement of few firms in research and development and that too in a few areas, the impact of these expenditures are felt by all. Not only products and supporting operations are becoming more complex but the life cycles of products are also being shortened.

Product Changes: Technological advances resulting partly from research and development, partly from growing customer sophistication, have resulted in the third cause of complexity – product changes. While the marketing manager of yesteryear had greater chances of his or her product ideas becoming marketable, today‟s manager needs to deal with an enormously high product mortality rate.

The Information Technology Changes: The changes in Information Technology (I.T.) have profound impact upon the complexity of management and organizations. The marketing manager knows that the ability to obtain, store, process, retrieve, and display the right information for the right decision is vital.

2. Increased Complexity of Decision Maker: You must have noticed that In the past, marketing managers have tended to solve problems as isolated situations, independent of other operations of the company, everything seems to be complicated when it comes to decision making. For this reason, marketing research comes to recluse. For example, if a T.V. manufacturer noted a sales decline and traced it to lack of aggressive effort by sales officers, the problem was assumed to be a sales management problem. Marketing research can help solve this. The other scopes of marketing research are as follows:

Research relating to markets:

To find out market potential for existing products

Sales research-forecasting

Finding and analysing market trends

Research relating to products:

Comparative study of competitors‟ products

Identify multiple uses for existing products

Test marketing of products

Product line research

Packaging of products

Consumer grievances

Research related to promotion:

Measure effectiveness of advertisement

Analyse effectiveness of salesmen

Media selection studies

Study patterns of competitors pricing

Motivational studies

Research related to distribution:

Design and locate outlets

Handling operation

Transportation

Storage

Research on pricing:

Cost analysis

Margin analysis

Price analysis

Demand analysis

features of Marketing Research

First, marketing research is systematic. Thus systematic planning is required at all the stages of the marketing research process. The procedures followed at each stage are methodologically sound, well documented, and, as much as possible, planned in advance. Marketing research uses the scientific method in that data are collected and analyzed to test prior notions or hypotheses. Marketing research is unbiased. It attempts to provide accurate information that reflects a true state of affairs. It should be conducted impartially. While research is always influenced by the

researcher's research philosophy, it should be free from the personal or political biases of the researcher or the management. Research which is motivated by personal or political gain involves a breach of professional standards. Such research is deliberately biased so as to result in predetermined findings. The motto of every researcher should be, "Find it and tell it like it is."

Marketing research involves the identification, collection, analysis, and dissemination of information. Each phase of this process is important. We identify or define the marketing research problem or opportunity and then determine what information is needed to investigate it, and inferences are drawn. Finally, the findings, implications and recommendations are provided in a format that allows the information to be used for management decision making and to be acted upon directly. It should be emphasized that marketing research is conducted to assist management in decision making and is not: a means or an end in itself. The lesson elaborates on this definition by classifying different types of marketing research

Q.2 What do you mean by sales forecasting? Explain the steps involved in it.

Ans-

Sales Forecasting

Sales forecasting can be explained as the prediction of the future sales of a particular product over a specific period of time based on past performance of the product, consumer spending patterns, inflation rates, market trends, unemployment, and interest rates. From this you, may very rightfully say that sales forecasts help the marketer to develop a marketing budget, allocate marketing resources, and monitor the competition and the product environment.

Steps in Sales Forecasting

You should adopt following steps while forecasting sales:

Defining the objectives to be achieved.

Dividing various products into homogeneous groups.

Analysing the importance of various factors to be studied for sales forecasting.

Selecting the method.

Collecting and analysing the related information.

Drawing conclusions from the analysis made.

Implementing the decisions taken.

Reviewing and revising the sales forecasting from time to time

Q.3 Write a short note on marketing audit.

Ans-Marketing Audit

Marketing audit is the hottest management concept in the new millennium and marketers are getting increasingly conscious about this, no matter small or large sized companies. No chief or head of marketing can afford to stay away from the up-to-date check on marketing process. The marketing audit provides good input for a plan of action to improve a company‟s marketing performance.

The ultimate utility or objective of conducting of Marketing Research could really lie in conducting Marketing Audit of the organization.

The marketing audit has the following four characteristic:

1. Comprehensive: The scope of marketing audit is relatively broad as it includes all the important marketing activities of business. In other words, it is not at all, problem oriented always.

2. Systematic: The audit follows a specific system and it is an orderly and well-organized scrutiny of organizations environment, objectives, strategies, activities, systems, etc.

3. Independent: It can be conducted in different ways as follows:

Self-audit: Here, the marketing manager utilizes a checklist in order to rate and evaluate different marketing activities or marketing operations.

Audit from across: Here, the marketing auditing activities are performed across the table.

Audit from above: Here the superior marketing manager in the official hierarchy conducts the audit of different marketing activities or marketing operations.

Audit officer of the company: Here, the officer of the company appointed for the purpose of conducting audit, conducts the same in respect of different marketing activities or marketing operations. This is technically termed as „Internal Audit‟, and the auditor, here is called as „Internal Auditor‟.

Company taskforce audit: Here, the audit is conducted by the company taskforce, created, specially, for the purpose of conducting audit.

Outside audit: Here, an outside agency or an organization is employed for conducting the audit. This is technically termed as „External Audit‟ and the auditor, here, is called as „External Auditor‟. 4. Periodic: The marketing audit is periodic that is repetitive in its nature. The period of audit may be varied depending upon the nature and the requirements of the sponsoring organization. (a) Periodic audit is, naturally, always superior as compared to its conducting as and only when there crops up a marketing problem like:

Poor sales performance

Decline in sales

Incurring of heavy looses

(b) The scope of the marketing audit extends to:

Marketing Environment

Marketing Objectives

Marketing Strategies

Marketing Activities, etc

(c) The objectives of the marketing audit are: i) To determine the problem areas and opportunities. ii) To recommend a plan of action, in order to improve the marketing performance.

Components of marketing audit The various components of marketing audit have been identified as follows:

Marketing environment audit

Marketing strategy audit

Marketing organization audit

Marketing systems audit

Marketing function audit

Marketing productivity audit

Marketing Environment Audit: Marketing environment audit concentrates on:

Macro environment

Demographic environment

Economic environment

Political environment

Cultural environment

Technological environment

Task environment

Markets

Customers

Competitors

Distributors

Dealers.

Marketing Strategy Audit: Marketing strategy audit focus on:

Business strategy

Business mission

Business objectives

Marketing Organization Audit: Marketing organization audit area of concentrates on:

Organization structure

Organizational efficiency

Marketing Systems Audit: The area of marketing system audit are:

Marketing information systems

Marketing planning systems

Marketing control systems

New product development systems

Marketing Function Audit Marketing function audit concentrates on:

Product line objectives

Pricing objectives

Distribution objectives

Advertising objectives

Sales force objectives

Marketing Productivity Audit

Marketing productivity audit concentrates on:

Cost-benefit analysis

Profitability analysis

Methodology of Marketing Audit The auditor collects the relevant and significant data for the purpose of audit by conducting interviews of:

Customers

Dealers

Sales representatives

Marketing executives

People from top management

Q.4 What are client ethics and field service ethics? Explain with example.

Ans-

Client Ethics Like research suppliers, clients (or users) also have a number of ethical dos and don’ts. Some of the more common client problems are requesting bids when a supplier has been predetermined, requesting bids to obtain free advice and methodology, making false promises, and issuing unauthorized RFPs.

Requesting bids when a supplier has been predetermined: It is not uncommon for a client to prefer one research supplier over another. Such a preference may be due to a good working relationship, cost considerations, ability to make deadlines, friendship, or quality of the research staff. Having a preference per se is not unethical. It is unethical, however, to predetermine which supplier will receive a contract and yet ask for proposals from other suppliers to satisfy corporate requirements. Requiring time, effort, and money from firms that have no opportunity to win the contract is very unfair. Why more than a single RFP? Some corporations require more than one bid.

Requesting Bids to Obtain Free Advice and Methodology: Client companies seeking bargain basement prices have been known to solicit detailed proposals, including complete methodology and a sample questionnaire, from a number of suppliers. After ―picking the brains‖ of the suppliers, the client assembles a questionnaire and then contracts directly with field services to gather the data. A variation of this tactic is to go to the cheapest supplier with the client’s own proposal, derived by taking the best ideas from the other proposals. The client then attempts to get the supplier to conduct the more elaborate study at the lower price.

Making False Promises: Another technique used by unethical clients to lower their research costs is to hold out a nonexistent carrot. For example, a client might say, ―I don’t want to promise anything, but we are planning a major stream of research in this area, and if you will give us a good price on this first study, we will make it up to you on the next one.‖ Unfortunately, the next one never comes – or if it does, the same line is used on another unsuspecting supplier. Requesting Proposals without Authorization: In each of the following situations, a client representative sought proposals without first receiving the authority to allocate the funds to implement them:

A client representative decided to ask for proposals and then go to management to find out whether she could get the funds to carry them out.

A highly regarded employee made a proposal to management on the need for marketing research in a given area. Although managers were not too enthused about the idea, they told the researcher to seek bids so as not to dampen his interest or miss a potentially (but, in their view, highly unlikely) good idea.

A client representative and her management had different ideas on what the problem was and how it should be solved. The research supplier was not informed of the management view, and even though the proposal met the representative’s requirements, management rejected it out of hand.

Without consulting with the sales department, a client representative asked for a proposal on analyzing present sales performance. Through fear of negative feedback, corporate politics, or lack of understanding of marketing research, the sales department blocked implementation of the proposal.

Field Service Ethics

Marketing research field services are the production arm of the research industry requiring telephone or face-to-face interviews. They are the critical link between the respondent and the research supplier. It is imperative that they properly record information and carefully follow sampling plans. Otherwise, even the best research design will produce invalid information (garbage in; garbage out). Maintaining high ethical standards will aid a field service in procuring good raw data for the research firm.

Using Professional Respondents: The problem of professional respondents arises most often in the recruitment of focus group participants. Virtually all field services maintain a database of people willing to participate in qualitative discussion groups, along with a list of their demographic characteristics. Maintaining such a list is good business and quite ethical. When qualifications for group participants are easy (for example, pet owners, persons who drive SUVs), there is little temptation to use professional respondents. However, when a supplier wants, for example, persons who are heavy users of Oxydol detergent or who own a Russian Blue cat, it is not unheard of for a group recruiter to call a professional respondent and say, ―I can get you into a group tomorrow with a $75 respondent fee and all you need to say is that you own a Russian Blue cat.‖ In an attempt to weed out professional respondents, a research supplier may specify that the participant must not have been a member of a qualitative discussion group within the past 6 months. However, dishonest field services will simply tell the professional respondent to deny having participated in a group within the past 6 months

Q.5 Discuss different types of information applicable in market research and mention their uses.

Ans-

Q.6 What is SPSS? How does SPSS help in marketing research?

Ans- Concept of Statistical Package for the Social Sciences

SPSS is the data analysis package of choice for people wanting to analyze quantitative data. However, most researchers find dealing with quantitative data quite daunting. Although most researchers are quite comfortable with qualitative research methods and analyses, they tend to shy away from using quantitative statistics. However, the ability to perform quantitative data analysis is increasingly becoming an important skill for researchers to possess. Actually most people ¶s fear of statistics is unfounded. The advent of computer software programmes such as SPSS that can be used to analyze data, has meant that people do not have to know or learn mathematical formulae in order to be able to perform quantitative statistical analyses. Nowadays, all one needs to know is the appropriate analyses to perform on their data and how to do it so they can obtain the information they need to know. Knowledge of SPSS is useful because:·

SPSS is a leader in the field of market research and social surveys· It has been in the forefront of these fields for over 40 years·

It is a very powerful piece of software that will enable you to carry out quantitative analysis in seconds·

You can legitimately see it as an extension or complement to Excel·

It is easier to use than other packages when it comes to handling large datasets·

It may help you get a job in the job market.

Statistical Package for the Social Sciences marketing researcher:-

SPSS is used by market researchers, health researchers, survey companies, government, education researchers, marketing organizations and others. In addition to statistical analysis, data management (case selection, file reshaping, creating derived data) and data documentation (a meta data dictionary is stored with the data) are features of the base software.

The developers of the Statistical Package for the Social Sciences (SPSS) made every effort to make the software easy to use. This prevents you from making mistakes or even forgetting something. That ¶s not to say it ¶s impossible to do something wrong, but the SPSS software works hard to keep you from running into the ditch. To foul things up, you almost have to work at figuring out a way of doing something wrong

 

You always begin by defining a set of variables,and then you enter data for the variables tocreate a number of cases.

For example, if you are doing an analysis of automobiles, each car in your study would be a case. The variables that define the cases could be things such as the year of manufacture, horsepower, and cubic inches of displacement. Each car in the study is defined as a single case, and each case is defined as a set of values assigned to the collection of variables. Every case has a value for each variable. (Well, you can have a missing value, but that ¶s a special situation described later.)

Variables have types. That is, each variable is defined as containing a specific kind of number.For example, a Scale variable is a numeric measurement, such as weight or miles per gallon. Acategorical variable contains values that define a category; for example, a variable named gender could be a categorical variable defined to contain only values 1 for female and 2 for male. Things that make sense for one type of variable don¶ t necessarily make sense for another r. For example, it makes sense to calculate the average miles per gallon, but not the average gender.