3 marketing research

Prepared byPrepared byAngela Zigras, Seneca CollegeAngela Zigras, Seneca College

Deborah Baker, Texas Christian UniversityDeborah Baker, Texas Christian University

DECISION DECISION

SUPPORT SUPPORT

SYSTEMS AND SYSTEMS AND

MARKETING MARKETING

RESEARCHRESEARCH

You will learn to ...You will learn to ...

1.1. Explain the concept and purpose of a Explain the concept and purpose of a marketing decision support system.marketing decision support system.

2. Define marketing research and explain its 2. Define marketing research and explain its importance to marketing decision making.importance to marketing decision making.

3. Describe the steps involved in conducting 3. Describe the steps involved in conducting a marketing research project.a marketing research project.

You will learn to ...You will learn to ...

4. Discuss the growing importance of 4. Discuss the growing importance of

scanner-based research.scanner-based research.

5. Explain when marketing research should 5. Explain when marketing research should and should not be conducted.and should not be conducted.

Marketing IntelligenceMarketing Intelligence

Everyday information about Everyday information about

developments in the developments in the

marketing environment that marketing environment that

managers use to prepare managers use to prepare

and adjust marketing plans.and adjust marketing plans.

Decision Support SystemDecision Support System

An interactive, flexible An interactive, flexible

computerized information computerized information

system that enables system that enables

managers to obtain and managers to obtain and

manipulate information as manipulate information as

they are making decisions.they are making decisions.

DSS System CharacteristicsDSS System Characteristics

CharacteristicsCharacteristicsof a of a

DSS SystemDSS System

CharacteristicsCharacteristicsof a of a

DSS SystemDSS System

InteractiveInteractive

FlexibleFlexible

Discovery-OrientedDiscovery-Oriented

AccessibleAccessible

Database MarketingDatabase Marketing

The creation of a large The creation of a large

computerized file of computerized file of

customers’ and potential customers’ and potential

customers’ profiles and customers’ profiles and

purchase patterns.purchase patterns.

Marketing ResearchMarketing Research

The process of planning, The process of planning,

collecting, and analyzing collecting, and analyzing

data relevant to a marketing data relevant to a marketing

decision.decision.

Defining Market Research Defining Market Research (1)(1)

Research is the systematic and objective Research is the systematic and objective approach to investigate a specific approach to investigate a specific problem that needs a solution.problem that needs a solution.

Research is a process by which a series Research is a process by which a series of well thought out and carefully of well thought out and carefully executed activities enable one to executed activities enable one to enquire, investigate or examine a enquire, investigate or examine a problem to discover new facts to deal problem to discover new facts to deal with the problem.with the problem.

Defining Research Defining Research (2)(2)

Systematic : well organised and plannedSystematic : well organised and planned Objectivity : unbiased and unemotionalObjectivity : unbiased and unemotional The information is used to identify and define The information is used to identify and define

opportunities and problems, and make opportunities and problems, and make recommendations on solutionsrecommendations on solutions

Market Research links consumer, customer and Market Research links consumer, customer and the public to the marketers through information.the public to the marketers through information.

Generate, refine and evaluate marketing Generate, refine and evaluate marketing actions, performance and the marketing actions, performance and the marketing process.process.

Issues to consider with Problem definitionIssues to consider with Problem definition

PPast informationast information (secondary (secondary data/MIS)data/MIS)

RResources and constraintsesources and constraints OObjectivesbjectives BBuyer behuyer behaviouraviour (human or (human or

organisational)organisational) LLegal environmentegal environment EEconomic environmentconomic environment MMaarketingrketing and technological and technological

skillsskills

PP RR OO BB LL EE MM

Roles of Marketing ResearchRoles of Marketing Research

DescriptiveDescriptive

DiagnosticDiagnostic

PredictivePredictive

Marketing Research Marketing Research

has three roles:has three roles:

Marketing Research Marketing Research

has three roles:has three roles:

DiagnosticDiagnostic

PredictivePredictive

DescriptiveDescriptive

Gathering and presenting factual statements

Explaining data

Attempting to estimate the results of a planned marketing decision

Roles of Marketing ResearchRoles of Marketing Research

Management Uses of Management Uses of Marketing ResearchMarketing Research

Improve the quality of decision makingImprove the quality of decision making

Trace problemsTrace problems

Focus on keeping existing customersFocus on keeping existing customers

Understand the ever-changing Understand the ever-changing marketplacemarketplace

Steps in a Marketing Research Steps in a Marketing Research ProjectProject

CollectCollectDataData

CollectCollectDataData

Plan Design/Plan Design/Primary DataPrimary DataPlan Design/Plan Design/Primary DataPrimary Data SpecifySpecify

SamplingSamplingProcedureProcedure

SpecifySpecifySamplingSamplingProcedureProcedure

DefineDefineProblemProblemDefineDefine

ProblemProblem

AnalyzeAnalyzeDataData

AnalyzeAnalyzeDataData

Prepare/Prepare/PresentPresentReportReport

Prepare/Prepare/PresentPresentReportReport

Follow UpFollow UpFollow UpFollow Up

Marketing ResearchMarketing Research

Marketing Marketing Research Research ProblemProblem

Marketing Marketing Research Research ProblemProblem

MarketingMarketingResearch Research ObjectiveObjective

MarketingMarketingResearch Research ObjectiveObjective

Management Management Decision Decision ProblemProblem

Management Management Decision Decision ProblemProblem

Determining what information is needed and how that information can be

obtained efficiently and effectively.

The specific information needed to solve a marketing research problem; the objective should provide insightful

decision-making information.

The specific information needed to solve a marketing research problem; the objective should provide insightful

decision-making information.

A broad-based problem that requires marketing research in order for managers to take proper actions.

A broad-based problem that requires marketing research in order for managers to take proper actions.

Objective setting Objective setting example 1example 1

Management ProblemManagement Problem::

Should a new product be launched?Should a new product be launched?

Research ObjectiveResearch Objective::

Determine consumer preference and Determine consumer preference and purchase intentions for the proposed purchase intentions for the proposed new product.new product.

Objective setting Objective setting example 2example 2

Management ProblemManagement Problem::

Should the ad campaign be Should the ad campaign be changed?changed?

Research ObjectiveResearch Objective::

To determine effectiveness of the To determine effectiveness of the current campaign.current campaign.

Objective setting Objective setting example 3example 3

Management ProblemManagement Problem::Should the price of the brand be Should the price of the brand be increased?increased?

Research ObjectiveResearch Objective::To determine the price elasticity of To determine the price elasticity of demand and the impact on sales and demand and the impact on sales and profits of various levels of price profits of various levels of price changes. changes.

Sources of Secondary DataSources of Secondary Data

Marketing Research Firms

Trade and Industry Associations

National Research Bureaus

Professional Associations

Commercial Publications

Internal Information

Secondary DataSecondary Data

Data previously collected Data previously collected

for any purpose other for any purpose other

than the one at hand.than the one at hand.

Advantages of Secondary DataAdvantages of Secondary Data

Saves time and money if on targetSaves time and money if on target

Aids in determining direction for primary data Aids in determining direction for primary data collectioncollection

Pinpoints the kinds of people to approachPinpoints the kinds of people to approach

Serves as a basis of comparison for other Serves as a basis of comparison for other datadata

Disadvantages of Secondary DataDisadvantages of Secondary Data

May not be on target with the research May not be on target with the research problemproblem

Quality and accuracy of data may pose Quality and accuracy of data may pose a problema problem

The New Age of The New Age of Secondary InformationSecondary Information

The InternetThe InternetThe InternetThe Internet

wwwwww Search EnginesSearch Enginesand Directoriesand Directories

Sites of Interest toSites of Interest toMarketing ResearchersMarketing Researchers

Discussion GroupsDiscussion Groups

Periodical, Newspaper, and Book DatabasesPeriodical, Newspaper, and Book Databases

Basic Types of DirectoriesBasic Types of Directories

Academic and Professional Academic and Professional DirectoriesDirectories

Commercial PortalsCommercial Portals

Research DesignResearch Design

Specifies which research Specifies which research

questions must be questions must be

answered, how and when answered, how and when

the data will be gathered, the data will be gathered,

and how the data will be and how the data will be

analyzed.analyzed.

Planning the Research DesignPlanning the Research Design

Which research Which research questions questions

must be answered?must be answered?

Which research Which research questions questions

must be answered?must be answered?

How and whenHow and whenwill data be will data be gathered?gathered?

How and whenHow and whenwill data be will data be gathered?gathered?

How willHow willthe datathe data

be analyzed?be analyzed?

How willHow willthe datathe data

be analyzed?be analyzed?

??

Primary DataPrimary Data

Information collected for Information collected for

the first time. Can be the first time. Can be

used for solving the used for solving the

particular problem particular problem

under investigation.under investigation.

Advantages of Primary DataAdvantages of Primary Data

Answers a specific research questionAnswers a specific research question

Data are currentData are current

Source of data is knownSource of data is known

Secrecy can be maintainedSecrecy can be maintained

Disadvantages of Primary DataDisadvantages of Primary Data

ExpensiveExpensive

Quality declines if interviews are lengthyQuality declines if interviews are lengthy

Reluctance to participate in lengthy Reluctance to participate in lengthy interviewsinterviews

Survey ResearchSurvey Research

The most popular technique The most popular technique

for gathering primary data for gathering primary data

in which a researcher in which a researcher

interacts with people to interacts with people to

obtain facts, opinions, obtain facts, opinions,

and attitudes.and attitudes.

Forms of Survey ResearchForms of Survey Research

Focus GroupsFocus Groups

Internet SurveysInternet Surveys

Mail SurveysMail Surveys

Telephone Interviews(Home and Central Location)

Telephone Interviews(Home and Central Location)

Mall Intercept InterviewsMall Intercept Interviews

Computer-assisted Personal Interviewing

Mall Intercept InterviewMall Intercept Interview

Survey research method Survey research method

that involves interviewing that involves interviewing

people in the common people in the common

areas of shopping malls.areas of shopping malls.

Computer-Assisted Personal Computer-Assisted Personal InterviewingInterviewing

An interviewing method in An interviewing method in

which the interviewer reads which the interviewer reads

the questions from a the questions from a

computer screen and enters computer screen and enters

the respondent’s data the respondent’s data

directly into the computer.directly into the computer.

Impact of the InternetImpact of the Internet

Allows better and faster decision makingAllows better and faster decision making

Improves ability to respond quickly to Improves ability to respond quickly to customer needs and market shiftscustomer needs and market shifts

Makes follow-up studies and research Makes follow-up studies and research easiereasier

Slashes labour-and time-intensive Slashes labour-and time-intensive research activitiesresearch activities

Advantages of Internet SurveysAdvantages of Internet Surveys

Contact with the hard-to-reach

Contact with the hard-to-reach

Improved respondent participation

Improved respondent participation

Personalized questions and data

Personalized questions and data

Reduced costsReduced costs

Rapid development,Real-time reporting

Rapid development,Real-time reporting

Advantages ofAdvantages ofInternet SurveysInternet SurveysAdvantages ofAdvantages of

Internet SurveysInternet Surveys

Internet SamplesInternet Samples

UnrestrictedInternet Sample

UnrestrictedInternet Sample

ScreenedInternet Sample

ScreenedInternet Sample

RecruitedInternet Sample

RecruitedInternet Sample

A survey in which anyone with a computer and modem can fill out

the questionnaire.

A survey in which anyone with a computer and modem can fill out

the questionnaire.

An Internet sample with quotas based on desired sample

characteristics.

An Internet sample with quotas based on desired sample

characteristics.

A sample in which respondents are prerecruited and must

qualify to participate.

A sample in which respondents are prerecruited and must

qualify to participate.

Other Uses of the InternetOther Uses of the Internet

Other Internet Other Internet Uses Uses

by Marketing by Marketing ResearchersResearchers

Other Internet Other Internet Uses Uses

by Marketing by Marketing ResearchersResearchers

Viewing of presentations of marketing research surveysViewing of presentations of marketing research surveys

Publication and distributionof reports

Publication and distributionof reports

Data management and on-line analysis

Data management and on-line analysis

Collaboration in the management of a research project

Collaboration in the management of a research project

Distribution of requests for proposals

Distribution of requests for proposals

Focus GroupFocus Group

Seven to ten people who Seven to ten people who

participate in a group participate in a group

discussion led by a discussion led by a

moderator.moderator.

Advantages of Advantages of On-Line Focus GroupsOn-Line Focus Groups

SpeedSpeed

Cost-effectivenessCost-effectiveness

Broad geographic Broad geographic scopescope

AccessibilityAccessibility

HonestyHonesty

Questionnaire DesignQuestionnaire Design

Open-EndedQuestion

Open-EndedQuestion

Closed-EndedQuestion

Closed-EndedQuestion

Scaled-Response Question

Scaled-Response Question

An interview question that encourages an answer phrased in

respondent’s own words.

An interview question that encourages an answer phrased in

respondent’s own words.

An interview question that asks the respondent to make a selection

from a limited list of responses.

An interview question that asks the respondent to make a selection

from a limited list of responses.

A closed-ended question designed to measure the intensity

of a respondent’s answer.

A closed-ended question designed to measure the intensity

of a respondent’s answer.

Questionnaire DesignQuestionnaire Design

Qualities Qualities of of

Good Good QuestionnairesQuestionnaires

Qualities Qualities of of

Good Good QuestionnairesQuestionnaires

Clear and ConciseClear and Concise

No Ambiguous LanguageNo Ambiguous Language

UnbiasedUnbiased

Reasonable TerminologyReasonable Terminology

Observation ResearchObservation Research

A research method that A research method that

relies on three types of relies on three types of

observation:observation:people watching peoplepeople watching people

people watching an activitypeople watching an activity

machines watching peoplemachines watching people

Observation ResearchObservation Research

Mystery Shoppers

One-Way Mirrors

Types ofTypes ofObservationObservation

ResearchResearch

Types ofTypes ofObservationObservation

ResearchResearchAudits

Machines Watching

People

Machines Watching

People

People People Watching Watching

PeoplePeople

People People Watching Watching

PeoplePeople

People People Watching Watching an Activityan Activity

People People Watching Watching an Activityan Activity

Traffic Counters

Passive People Meter

Mystery ShoppersMystery Shoppers

Researchers posing as Researchers posing as

customers who gather customers who gather

observational data about observational data about

a store and collect data a store and collect data

about customer/employee about customer/employee

interactions.interactions.

ExperimentExperiment

A method a researcher uses A method a researcher uses

to gather primary data. to gather primary data.

Sampling ProcedureSampling Procedure

SampleSample

UniverseUniverse

A subset from a large population.A subset from a large population.

The population from which a sample will be drawn.

The population from which a sample will be drawn.

Probability SamplesProbability Samples

ProbabilitySample

ProbabilitySample

A sample in which every element in the population has a known statistical

likelihood of being selected.

A sample in which every element in the population has a known statistical

likelihood of being selected.

Random Sample

Random Sample

A sample arranged so that every element of the population has an equal change of being selected.

A sample arranged so that every element of the population has an equal change of being selected.

Nonprobability SamplesNonprobability Samples

NonprobabilitySample

NonprobabilitySample

Convenience Sample

Convenience Sample

Any sample in which little or no attempt is made to get a representative

cross-section of the population

A form of nonprobability sample using respondents who are

convenient or readily accessible to the researcher.

A form of nonprobability sample using respondents who are

convenient or readily accessible to the researcher.

Sampling ProcedureSampling Procedure

UniverseUniverse

SampleSample

Probability Samples

Probability Samples

Non-Probability Samples

Non-Probability Samples

Types of ErrorsTypes of Errors

Errors Errors AssociatedAssociated

with Samplingwith Sampling

Errors Errors AssociatedAssociated

with Samplingwith Sampling

Measurement ErrorMeasurement Error

Sampling ErrorSampling Error

Frame ErrorFrame Error

Random ErrorRandom Error

Types of ErrorsTypes of Errors

Measurement Error

Measurement Error

Sampling Error

Sampling Error

Frame Error

Frame Error

Random Error

Random Error

Error when there is a difference between the information desired and the

information provided by research

Error when there is a difference between the information desired and the

information provided by research

Error when a sample somehow does not represent the target population.

Error when a sample somehow does not represent the target population.

Error when a sample drawn from a population differs from the

target population.

Error when a sample drawn from a population differs from the

target population.

Error because the selected sample is an imperfect representation of

the overall population.

Error because the selected sample is an imperfect representation of

the overall population.

Field Service FirmField Service Firm

A firm that specializes in A firm that specializes in

interviewing respondents interviewing respondents

on a subcontracted basis. on a subcontracted basis.

Collecting DataCollecting Data

Focus group facilitiesFocus group facilities

Mall intercept locationsMall intercept locations

Test product storageTest product storage

Kitchen facilitiesKitchen facilities

Retail auditsRetail audits

Field Service Firms ProvideField Service Firms Provide

Types of SamplesTypes of Samples

Probability Probability SamplesSamples

Probability Probability SamplesSamples

Simple Random Sample

Stratified Sample

Cluster Sample

SystematicSample

Non-Probability Non-Probability SamplesSamples

Non-Probability Non-Probability SamplesSamples

Convenience Sample

JudgmentSample

Quota Sample

SnowballSample

Cross-TabulationCross-Tabulation

A method of analyzing data A method of analyzing data

that lets the analyst look at that lets the analyst look at

the responses to one the responses to one

question in relation to the question in relation to the

responses to one or more responses to one or more

other questions. other questions.

Preparing and Presenting Preparing and Presenting the Reportthe Report

Concise statement of the research Concise statement of the research objectivesobjectives

Explanation of research designExplanation of research design

Summary of major findingsSummary of major findings

Conclusion with recommendationsConclusion with recommendations

Following UpFollowing Up

Were the recommendations followed?Were the recommendations followed?

Was sufficient decision-making Was sufficient decision-making information included in the report?information included in the report?

What could have been done to make What could have been done to make the report more useful?the report more useful?

Scanner-Based ResearchScanner-Based Research

A system for gathering A system for gathering

information from a single information from a single

group of respondents by group of respondents by

continuously monitoring continuously monitoring

the advertising, promotion, the advertising, promotion,

and pricing they are and pricing they are

exposed to and the things exposed to and the things

they buy.they buy.

When Should Marketing When Should Marketing Research be Conducted?Research be Conducted?

Where there is a high Where there is a high level of uncertainty level of uncertainty

When value of research When value of research information exceeds the information exceeds the cost of generating the cost of generating the informationinformation