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Chapter Objectives
Explain the role of the marketing information system and the marketing decision support system in marketing decision making
Understand data mining and how marketers can put it to good use
List and explain the steps and key elements of the marketing research process
Appreciate the importance of high ethical standards in marketing research
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Real People, Real Choices:Decision Time at Plan-It Marketing
What marketing research strategy would maximize results of the research within a reasonable budget?– Option 1: conduct exploratory qualitative
study– Option 2: conduct quantitative survey of
700+ leisure and business travelers– Option 3: conduct viability study with both
qualitative exploratory study and confirmatory quantitative study
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Knowledge Is Power
Accurate, up-to-date, relevant information is the fuel that runs the marketing engine
Marketing information systems:– Determine what information marketing
managers need, then gathers, sorts, analyzes, stores, and distributes information to system users
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Marketing Information Systems
Marketing information systems (MIS) include multiple components:– Data:
• Internal company data• Marketing intelligence• Marketing research• Acquired database
– Computer hardware and software– Information for marketing decisions
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Internal Company Data
Internal data:Information from within the company to produce reports on the results of sales and marketing activities
Intranet: Internal corporate communications network that links company departments, employees, and databases
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Marketing Intelligence
Marketing intelligence systems:Method by which marketers get information about everyday happenings in the marketing environment– Example: Monitoring the Internet and using
“mystery shoppers” Futurists specialize in predicting
consumer trends
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Marketing Research
Market research:Collecting, analyzing, and interpreting data about customers, competitors, and the business environment to improve marketing effectiveness– Syndicated research– Custom research
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Acquired Databases
External databases can be used to collect a variety of information from different sources– Non-competing businesses– Government databases
Misuse of databases can be problematic and has led to do-not-call lists and antispam laws
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Marketing Decision Support Systems
Marketing decision support systems: Data plus analysis and interactive software that allow managers to conduct analyses and find the information that they need
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Searching for Gold: Data Mining
Data mining:Includes sophisticated analysis techniques to take advantage of the massive amount of transaction information now available
Analysts sift through data to identify unique patterns of behavior among different customer groups for use in behavioral targeting
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What Marketers Can Do with Data Mining
Data mining applications in marketing:– Customer acquisition– Customer retention and loyalty – Customer abandonment – Market basket analysis
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Steps in the Marketing Research Process
Step 1: Define the research problem– Specifying research objectives– Identifying consumer population of interest – Placing the problem in an environmental
context
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Steps in the Marketing Research Process
Step 2: Determine the research design– Determine whether secondary data are
available– Determine whether primary data are required
and if so, what type:• Exploratory research• Descriptive research• Causal research
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Secondary and Primary Research
Secondary data:– Have been collected for some purposes other
than the problem at hand
Primary data: – Information collected directly from
respondents to specifically address the question at hand
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Exploratory (Qualitative) Research
Exploratory research techniques generate insights for future, more rigorous studies– Typically involve in-depth consumer probing– Take many forms:
• Consumer interviews• Focus groups• Productive techniques• Case studies• Ethnography
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Descriptive (Quantitative) Research
Descriptive research studies:– Probe systematically into the problem– Base conclusions on large numbers of
observations– Typically expresses results in quantitative
terms (averages, percentages, other stats)• Cross-sectional design• Longitudinal design
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Causal Research
Cause-and-effect relationships: A change in one thing causes a change in something else– Independent (cause) vs. dependent (change
in outcome) variables– Experiments test predicted relationships
among variables in a controlled environment
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Steps in the Marketing Research Process
Step 3: Choose the method for collecting primary data– Survey methods are used to interview
respondents– Questionnaires:
• loosely, moderately, or completely structured
– Observational research methods– Online research
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Questionnaires
Mail questionnaires Telephone interviews Face-to-face interviews
– Mall intercept
Online questionnaires
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Observational Methods
Observation: Data collection method where the researcher records consumers’ behaviors, often without their knowledge– Personal observation – Mechanical observation– Unobtrusive measures
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Online Research
Types of online research:– Gathering information via consumer surfing – Gathering information via Web site/
e-mail/chat room questionnaires/focus groups Online research used as part of:
– New-product development– Estimating market response– Exploratory research
IM and focus groups
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Data Quality:Garbage In, Garbage Out
How much faith should marketing managers place in research? Three key considerations include:– Validity– Reliability– Representativeness
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Step 4: Design the Sample
Probability sampling:– Each member of the population has some
known chance of being included– Sample is representative of population, and
inferences about population are justified Types of probability sampling:
– Simple random sampling – Systematic sampling – Stratified sampling
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Step 4: Design the Sample
Nonprobability sample– Personal judgment used in selecting
respondents– Some members of population have no
chance of being included so sample is not representative of population
Types of nonprobability sampling– Convenience sampling – Quota sampling
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Step 5: Collect the Data
Challenges to gathering data in foreign countries include:– Differences in sophistication of research
operations – Infrastructure/transportation challenges – Lack of phones and/or low literacy rates– Local customs and cultural differences– Language translation difficulties
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Step 6: Analyze and Interpret the Data
Data must be analyzed and interpreted to be meaningful
Tabulation: – Arranging data in a table or other summary
form to get a broad picture of overall responses
Cross-tabulation: – Examining the data by subgroups to see how
results vary between categories
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Step 7: Prepare the Research Report
Research reports typically contain the following sections:– Executive summary– Description of research methodology– Discussion of results including tabulations,
cross-tabulations– Limitations of study– Conclusions and recommendations
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Ethics in Marketing Research
Marketing research ethics:Taking an ethical and above-board approach to conducting marketing research that does no harm to the participant in the process of conducting the research– Researchers must provide full disclosure of
confidentiality and anonymity options
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Real People, Real Choices: Decision Made at Plan-It Marketing
Cindy chose option 3, conducting both qualitative and quantitative research– Implementation: Concept design was refined
using input from qualitative research; quantitative study of 700 business and leisure travelers confirmed viability of Priceline’s business model concept
– Measuring success: Used total unduplicated reach and frequency analysis
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Keeping It Real: Fast-Forward to Next Class Decision Time at (RED)
Meet Julie Cordua, VP Marketing—(RED) (RED) works with international brands to
make unique products and directs up to 50% of gross profits to the Global Fund
The decision to be made: Is partnering with mass market international brands the optimal way to generate money for the Global Fund?
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