Market research fundamentals

www.eoi.es

MARKET RESEARCH

BLENDED EDUCATION

PROFESSOR Antonio Fontanini

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What is Market Research? • Simply a matter of finding out as

much as you can before committing yourself to an irretrievable step

• When you do not have answers through your own Market Information and Intelligence System

• The search of data to reduce risks in making commercial and marketing decisions

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What to find out? • What does the customer need? • Who is the target audience and how

much can you find out about them? • What is the competition? • Are there any gaps in the market? • Would the product be acceptable in

the market?

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The MR Process •  What is the Marketing Problem? •  What is the Research Problem? •  Developing the Research Plan •  Research Approach •  Research Instruments •  Collecting the Information •  Analysing the information •  Presentation of findings

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Marketing Strategy Planning Process

Customers Needs and other

Segmenting Dimensions

Company Mission, Objectives,

& Resources

Competitors Current & Prospective

S. W. O. T.

External Market Environment Technology, Political & Legal, Social & Cultural, Economic

Targeting & Segmentation

Positioning & Differentiation

Narrowing down to focused strategy with quantitative and qualitative screening criteria

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Marketing Information System and Research

•  MIS – What is Marketing Information System? – Who is responsible for the MIS? – Consideration with the MIS

•  Market Research: – Why using Market Research? – The Market Research Process – Considerations with the Market Research

•  How to measure the market and company demand?

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Why is information so important?

Reason 1: • Not getting the right information is

the perfect recipe for disaster – Base marketing strategies on valid

evidence and analysis

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Reason 2: • The current situation is extremely

dynamic and competitive • Technology • Globalization • Internet • Instant feedback and rapid change

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Reason 3: • If you do not make use of the

information available..

… your competition will do it!

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…we need a good Marketing Information

System!


Marketing Information System: consists of people, equipment and procedures to gather, sort, analyze, evaluate and distribute needed, timely, and accurate information to

(marketing) decision makers. Kotler


Who should be responsible for the MIS in an

organization?


Where is the MIS placed in an organization?

• Small companies: No formal department

• Medium companies: Within Marketing Departments

• Large companies: Within Strategy and Marketing + Headquarters


Market Research Studies

Internal Data

Sources

External Data

Sources

Databases

Decision Support System (DSS)

(Marketing) Manager Decisions

Outcomes

Marketing Models

Information Processing Specialists

Inputs

?

Answers N

ew In

form

atio

n

Feedback

Information Sources

Questions and Answers

Decision Maker

Results

MIS


Internal Data Sources • In all companies:

– Sales information – Info coming from internal employees – Info coming from retailers, current

customers, etc – Previous experiences – Previous research


Internal Data Sources • In multinational companies:

– Previous research (don´t do the same error twice please!)

– Similar experiences – Feedback from international employees


External Sources • Public sources:

– Public researches – Public listings – Others

• Private sources: – Panels (Nielsen) – Conducted research (GFK, IDC, etc) – INTERNET (Blogs, Tecnorati, Twitter, …)


Be sure that they are measuring what you are

looking for!


Marketing Research consists of the procedures

to develop and analyze new information

to help (marketing) managers make decisions.

Marketing research gets the "facts" not

already available in the marketing information system.


In-house research departments

Custom research firms

Consulting firms

Marketing Research Suppliers

Advertising agencies

Syndicated services

Colleges and universities

Marketing Research Suppliers


Defining the

Problem

Analyzing the

Situation

Getting Problem- Specific

Data

Inter- preting

Data

Solving the

Problem

Early Identification

of Solution

Feedback to Previous Steps

Marketing Research Process


Defining the

Problem


of Solution

•  Most important and difficult part of the process

•  80% of success here

•  What do we need to know?

•  What pieces of information will give us what we need?

•  Manager and researcher must work together



Defining the

Problem

Analyzing the

Situation



of Solution

•  What information is already available

(Secondary Data)



Defining the

Problem

Analyzing the

Situation


Data


of Solution




Qualitative vs Quantitative Research •  Qualititative approach:

– Relative unstructured measurement approach

– Gives more open responses and gives insight about perceptions difficult to measure

– Usually used to define properly the problem or hypothesis. • E.g. First step for measuring consumers brand and product perceptions

– Also could be used to give you a final go or instant feedback to make changes


Qualitative vs Quantitative Research

• Quantitative: – More structured research – It could be used before or after

qualitative research to identify patterns – Scientific information – Brings the solution or confirms the

hypothesis


Research approaches •  Observational Research •  Focus Group Research (6-10) •  In-depth interviews •  Pseudo-purchases (Mistery Shopper) •  Survey Research Telephone, Postal, Omnibus, Personal, Internet •  Data Bases •  Behavioral Data •  Experimental Data •  Panels

Qualitative (why?)

Quantitative (how many?)


Quantitative Research: Panels –  Retail

• Numerical distribution • Weighted distribution • Average unit of Sales per shop • Rotation period (no change, same sales level)

–  Consumer • Penetration (% of homes with al least one purchase) • Relative penetration (of a product over a product

line) • Average purchase (units, Kgs, Liters) • Average expense (euros spent in a product, brand, ..) •  TV panel (remote control monitoring, per person)


Selecting a survey technique

• Cost • Speed • Accuracy • Amount of

data

• Response rate • Flexibility • Control • Timing


The Questionnaire •  Filter questions: Do you drink wine? (if No: END) •  Control questions: questions already asked but formulated

in a different way (are you the person who does shopping? How many days of the week do you shop?)

•  Likert Scale Questions: grade of agreement (Small companies provide a better service than big ones:

Strongly disagree (1), Disagree (2), Neither A or D (3), Agree (4), Strongly Agree (5)

•  Open Questions: No answer is suggested What do you most like about the service in this bar?

•  Closed Questions: Limited answer Do you like to dine outside during the week? (YES or NO)

•  Semi-Closed Questions (Hybrid): What do you like in a Restaurant? (That it is cheap, elegant, quite, other)


Regarding Sampling

• Define the sampling unit: What is to be surveyed?

• Sample size: How many people should be surveyed?

• Sampling procedure: How should the respondents be chosen?


Types of errors

• Type I – when a true hypothesis is rejected

• Type II – when a false hypothesis is accepted


Sampling techniques

• Probability sampling • Non-probability sampling


Probability sampling •  Simple random sampling •  Systematic sampling: i, i+k, 2k, …, i+

(n-1)k each interval size keisima unit of the

sample K=N/n after a random start between i and k (number i being origin)

•  Stratified sampling: representing all interesting categories

•  Cluster sampling: representing all conglomerates


Non – Probability sampling •  Opinion sampling: we ask for experts to

determine what is the representative sample

•  Convenient sampling: the most accessible

•  Quota sampling: interviews of a determined number of people per each category

•  Snow ball sampling: each sample unit is nominated by another person within the sample group (study of marginal group).


N= K2*T*P*Q E2 *(T-1)+4*P*Q N = Sample size T = Target Market (eg: 1,200 people) P = Proportion of population who have (Q=1-P) E = sampling error (5%) Confidence level = 95,5% (K=2, thus K2=4) N = 4*1,200*0.50*(1-0.50) ________ 0.052 * (1,200-1) + 4*0.50*(1-0.50) N = 300 interviews

Probability sampling: Size


Confidence: 75% 80% 85% 90% 95% 95,5% 99% K= 1,15 1,28 1,44 1,65 1,96 2 2,58 Margin of error of 5% of a survey saying 100 people would buy means between 95 and 105 people would buy it.

Probability sampling: Size


Business Case

MARKET RESEARCH SIMULATION

http://openmultimedia.ie.edu/OpenProducts/usmc_i/usmc_i/portada.html


Always ask yourself regarding sampling:

Is the sample

representative?

Are the statistical techniques used appropriate?


A good research proposal keeps the process on track

What data will be collected

Quality control standards that will

be used

How it will be

collected

From whom

What it will cost

How long it will take

Who will analyze it

Research Proposal


Report Writing

•  Title •  Contents •  Preface •  Acknowledgements •  Introduction •  Objectives

•  Methodology •  Results and

discussion •  Conclusions/

findings •  Recommendations •  Appendices •  Bibliography


Defining the

Problem

Analyzing the

Situation


Data

Inter- preting

Data


of Solution




Data analysis

•  Averages •  Variances •  Proportions •  Std. Deviation •  Hypothesis

testing

•  Regression •  Correlation •  Factor analysis •  Cluster analysis •  Multivariate

analysis •  Discriminant

analysis


Defining the

Problem

Analyzing the

Situation


Data

Inter- preting

Data

Solving the

Problem


of Solution




Market Research Studies

Internal Data

Sources

External Data

Sources

Databases

Decision Support System (DSS)

Marketing Manager Decisions

Outcomes

Marketing Models

Information Processing Specialists

Inputs

?

Answers N

ew In

form

atio

n

Feedback

Information Sources

Questions and Answers

Decision Maker

Results


Quantitative Research Surveys


Qualitative vs Quantitative

Primary: No information available; Secondary: info already exists Qualitative research is normally used in initial steps: it is not inferior to the quantitative one, which gather objectively measurable information


Marketing Strategy Planning Process

04/08/14

Customers Needs and other

Segmenting Dimensions

Company Mission, Objectives,

& Resources

Competitors Current & Prospective

S. W. O. T.

External Market Environment Technology, Political & Legal, Social & Cultural, Economic

Targeting & Segmentation

Positioning & Differentiation

Narrowing down to focused strategy with quantitative and qualitative screening criteria


By experience… • Be sure to measure what the truth

is, and not what you think is right at the beginning.

• When being presented a (potential) study: – Be sure that they are measuring what

you really need – Be sure that the hypothesis and

methodology are the right ones • Take your time to study carefully

the research done


Gracias, gracias, gracias [email protected]

Market research fundamentals

Education

research problem

market information

marketing problem

research mis

mis market research

marketing decisions

research gfk

marketing managers