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CH09_MarketResearchCONTENTforWORDDOCUMENT.pptChapter 9
Marketing Research
Chapter 9 Decision Support Systems and Marketing Research
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Define marketing research and understand its importance to marketing decision making
Identify steps involved in conducting a marketing research project
Appreciate the profound impact of the Internet on marketing research
Discuss the growth of scanner-based research
Understand when marketing research should be conducted
Apply the concept of competitive intelligence
Learning Goals:
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Chapter 9 Decision Support Systems and Marketing Research
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Goal #1: Define marketing research and understand its importance to marketing decision making
The Role of
Marketing Research
© Cengage Learning Inc. 2015. All Rights Reserved.
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Chapter 9 Decision Support Systems and Marketing Research
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The Role of
Marketing Research
Marketing research is the process of planning, collecting, and analyzing data relevant to a marketing decision.
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Chapter 9 Decision Support Systems and Marketing Research
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Three Role of
Marketing Research
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Diagnostic
Predictive
Descriptive
Gathering and presenting factual statements
Explaining data
Addressing “what if” questions
Chapter 9 Decision Support Systems and Marketing Research
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Notes:
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Descriptive: What is the historic sales trend in the industry? What are consumers’ attitudes toward a product?
Diagnostic: What was the impact on sales after a change in the package design?
Predictive: “What if questions,” such as how can descriptive and diagnostic research be used to predict the results of a planned marketing decision?
Three Role of
Marketing Research
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Management Uses of Marketing Research
Marketing research can help managers in several ways:
- It improves the quality of decision making
- It helps managers trace problems
- It can help managers serve their customers accurately and efficiently
- It helps managers gauge the perceived value of their goods and services, as well as the level of customer satisfaction
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Management’s Uses of
Marketing Research
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Improve the quality of decision making
Trace problems
Focus on keeping existing customers
Understand the marketplace
Alert them to marketplace
trends
Gauge the value of goods
and services, and the level
of customer satisfaction
Chapter 9 Decision Support Systems and Marketing Research
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Goal #2: Identify steps involved
in conducting a marketing
research project
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Steps in a Marketing
Research Project
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Chapter 9 Decision Support Systems and Marketing Research
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Exhibit 9.1
The Marketing Research Process
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Collect
Data
Specify
Sampling
Procedure
Plan Design/
Primary Data
Define
Problem
Analyze
Data
Prepare/
Present
Report
Follow Up
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Step #1. Identify the Problem
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The Marketing Research Project
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Marketing Research Problem
Marketing Research Objective
Management Decision Problem
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 be to provide insightful decision-making information.
A broad-based problem that uses marketing research in order for managers to take proper actions.
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Chapter 9 Decision Support Systems and Marketing Research
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Sources of
Secondary Data
Secondary data is data previously collected for any purpose other than the one at hand.
Government Agencies
Trade and Industry Associations
Business Periodicals
News Media
Internal Corporate Information
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Notes:
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Advantages of
Secondary Data
Saves time and money… if it is on target
Aids in determining direction for primary data collection
Pinpoints the kinds of people to approach
Serves as a basis of comparison for other data
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Disadvantages of
Secondary Data
May not give adequate detailed information
May not be on target with the research problem
Quality and accuracy of data may pose a problem
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Chapter 9 Decision Support Systems and Marketing Research
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The New Age of Secondary Information: The Internet
The rapid development of the Internet has eliminated much of the drudgery associated with the collection of secondary data.
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Chapter 9 Decision Support Systems and Marketing Research
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Notes:
- Gathering secondary data has traditionally been a tedious boring job.
- The researcher often had to write to government agencies, trade associations, or other secondary data providers and then wait days or weeks for a reply that might never come.
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Planning the Research Design
Research design specifies which research questions must be answered, how and when the data will be gathered, and how the data will be analyzed.
Which research
questions
must be answered?
How and when
will data be
gathered?
How will
the data
be analyzed?
?
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Notes:
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Primary Data
DEF: Information collected for the first time. Used for solving the particular problem under investigation.
Advantages:
Answers a specific research question
Data are current
Source of data is known
Secrecy can be maintained
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Disadvantages of
Primary Data
Primary data can be very expensive.
Disadvantages are usually offset by the advantages of primary data.
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Notes:
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Survey Research
The most popular technique for gathering primary data, in which a researcher interacts with people to obtain facts, opinions, and attitudes.
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Forms of Survey Research
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Focus Groups
Executive Interviews
Mail Surveys
Telephone Interviews
Mall Intercept Interviews
In-Home Interviews
Chapter 9 Decision Support Systems and Marketing Research
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Notes:
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In-home personal interviews: Provide high-quality information, but are expensive because of travel time and mileage costs for the interviewer. Not a popular survey tool in the U.S. and Europe.
Mall Intercept interviews: Conducted in shopping malls or in a marketing research office in the mall. Surveys must be brief. It is hard to get a representative sample of the population. However, probing is possible.
Telephone interviews: Cost less and provide one of the best samples of any traditional survey procedure. Many facilities for telephone interviews utilize computer-assisted interviewing, where information is directly input into a computer application. The federal “Do Not Call” law does not apply to survey research.
Mail Surveys: Benefits are the low cost, elimination of interviews, centralized control, and anonymity for respondents. However, mail questionnaires usually produce low response rates. Consequently, the resulting sample may not represent the surveyed population. However, mail panels, consisting of a sample of households recruited to participate for a given period, yield response rates of 70 percent.
Executive interviews: Involves interviewing businesspeople at their offices regarding industrial products or services. This type of interviewing is expensive, due to the process of finding, qualifying, and interviewing respondents.
Focus groups: A type of personal interviewing, characterized by seven to ten people gathered in a meeting place. The interaction provides group dynamics, with an interplay of responses yielding richer information than individual interviews.
Forms of Survey Research
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Questionnaire Design
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Open-Ended
Question
Closed-Ended
Question
Scaled-
Response
Question
An interview question that encourages an answer phrased in the respondent’s own words.
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.
Chapter 9 Decision Support Systems and Marketing Research
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Questionnaire Design
Clear and concise
No ambiguous language
Avoid two questions in one
Avoid leading questions
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Observation Research
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DEF: Observation research is the systematic process of recording the behavioral patterns of people, objects, and occurrences without questioning them.
Chapter 9 Decision Support Systems and Marketing Research
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Notes
Exhibit 9.4
Observational Situations
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| Situation | Example |
| People watching people | Observers stationed in supermarkets watch consumers select frozen Mexican dinners; the purpose is to see how much comparison shopping people do at the point of purchase. |
| People watching phenomena | Observer stationed at an intersection counts traffic moving in various directions. |
| Machines watching people | Movie or videotape cameras record behavior as in the people-watching-people example above. |
| Machines watching phenomena | Traffic counting machines monitor traffic flow. |
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Observational Research
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Two common forms of “people-watching-people research” are one-way mirror observations and mystery shoppers.
Mystery Shoppers
Behavioral Targeting (BT)
Researchers posing as customers who gather observational data about a store.
A form of observation marketing research that uses data mining coupled with identifying Web surfers by the IP addresses.
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Social Media and Big Data
Through social media monitoring, a researcher can learn what is being said about the brand and the competition.
Monitoring social media and tracking shopping behavior online are only two inputs into the new era of big data.
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Big data is the exponential growth in the volume, variety, and velocity of information and the development of complex, new tools to analyze and create meaning from such data.
Chapter 9 Decision Support Systems and Marketing Research
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Ethnographic Research
The study of human behavior in its natural context; involves observation of behavior and
physical setting.
Ethnographic research comes from the field of anthropology and is becoming popular in marketing research. Ethnographers directly observe the population they are studying to gain richer insights into the culture and behavior of people.
Chapter 9 Decision Support Systems and Marketing Research
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Notes:
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Virtual Shopping
Advantages of virtual shopping:
- Creates an environment with a realistic level of complexity and variety.
- Allows quick set up and altering of tests.
- Low production costs.
- High flexibility.
Chapter 9 Decision Support Systems and Marketing Research
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Experiments
An Experiment is a method a researcher can use to gather primary data.
Experiment Variables
Price
Package design
Shelf space
Advertising theme
Advertising expenditures
Notes:
An experiment is
Chapter 9 Decision Support Systems and Marketing Research
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Mobile Research
Mobile devices and laptops are being used for all kinds of marketing research. Techniques now employed using mobile devices include:
- Location-based surveys
- Product scanning during the shopping process
- Using cameras on mobile devices to upload digital images and videos
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Once the researchers decide how to collect primary data, the next step is to select the sampling procedures being used. Not all possible users of a new product can be interviewed, therefore, a researcher must select a sample or a subset of the larger population.
- The population or universe must first be defined.
- Then it is determined if the sample must be representative of the population. If the answer is yes, a probability sample is needed.
The Research Sample
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Sampling Procedure
Universe
Sample
Probability Samples
Non-Probability Samples
Chapter 9 Decision Support Systems and Marketing Research
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Notes:
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Exhibit 9.6 Types of Samples
Simple Random Sample
Stratified
Sample
Cluster
Sample
Systematic
Sample
Probability Samples
Non-Probability Samples
Convenience
Sample
Judgment
Sample
Quota
Sample
Snowball
Sample
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Chapter 9 Decision Support Systems and Marketing Research
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Probability Samples
Probability
Sample
A sample in which every element in the population has a known statistical likelihood of being selected.
Random
Sample
A sample arranged so that every element of the population has an equal chance of being selected.
The most desirable feature of a probability sample is that statistical rules can be used to ensure that the sample represents the population.
One type of probability sample is the random sample—where every element of the population has an equal chance of being selected as part of the sample.
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Nonprobability Samples
Nonprobability
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.
Convenience sample, such as employees, relatives, or friends. Because of their lower cost, nonprobability samples are the basis of much marketing research.
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Types of Errors
Sampling
Error
Error when a sample somehow does not represent the target population.
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Notes:
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Collecting the Data
Most primary data is collected by marketing research field service firms.
Field service firms conduct interviews, provide focus-group facilities, mall intercept locations, test product stores, and kitchen facilities to prepare test food products.
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Organizing the Data
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Data is organized using (1) one-way frequency counts, (2) cross-tabulations, and (3) more sophisticated statistical analysis.
- One-way frequency tables record the responses to a question and provide a general picture of the study’s results.
- A cross-tabulation looks at the associations between certain responses, such as association between gender and product choice.
Organizing the Data
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Analyzing the Data
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The purpose of data analysis is to interpret and draw conclusions from the collected data.
Chapter 9 Decision Support Systems and Marketing Research
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After data analysis is completed, the report is prepared; conclusions and recommendations are communicated to management.
Preparing the Research Report
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The report should be tailored to the audience, beginning with a (1) statement of the problem; (2) description of the research objectives; followed by a brief (3) explanation of the research design. A (4) summary of major findings is next, followed by (5) conclusions drawn; and concluding with (6) recommendations for actions.
Elements the Research Report
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Following Up
Were the recommendations followed?
Was sufficient decision-making information included in the report?
What could have been done to make the report more useful to management?
Chapter 9 Decision Support Systems and Marketing Research
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GOAL #3: Appreciating the profound impact of the Internet on marketing research
The Profound Impact of the Internet
On Marketing Research
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Chapter 9 Decision Support Systems and Marketing Research
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Impact of the Internet
In the U.S., 245 million people—78 percent of the population—are online, spanning every ethnic, socioeconomic, and educational divide.
More than 90 percent of America’s marketing research companies conduct some form of online research.
Online survey research has replaced computer-assisted telephone interviewing (CATI) as the most popular mode of data collection.
Internet data collection is rated as having the greatest potential for further growth.
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Advantages of
Internet Surveys
Contact with the
hard-to-reach
Improved respondent
participation
Personalized questions
and data
Reduced costs
Rapid development,
Real-time reporting
Chapter 9 Decision Support Systems and Marketing Research
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Notes:
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Uses of the Internet by
Marketing Researchers
Other types of marketing research
Conduct focus groups
Administer surveys
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Methods of Conducting Online Surveys
- Web Survey Systems
- Survey Design and Web Hosting Sites
- Online Panel Providers
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Advantages of Online
Focus Groups
Ease of use
Better participation rates
Cost-effectiveness
Broad geographic scope
Accessibility
Honesty
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Ease of use: the respondent does not have to do any work to see the stimuli
Better participation rates: Conducted over the course of days, participants less likely to pull out.
Cost-effectiveness: Face-to-face groups incur costs for facility rental, airfare, hotel, food, etc.
Broad geographic scope: Time is flexible online, providing a world-wide respondent pool.
Accessibility: Give access to participants who might otherwise be difficult to recruit.
Honesty: Anonymity makes respondents tend to talk more freely.
Advantages of Online
Focus Groups
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Web Community Research
- A carefully selected group of consumers who agree to participate in an ongoing dialogue with a particular corporation.
- Web communities:
- Engage customers
- Achieve customer-derived innovations
- Establish brand advocates
- Offer real-time results
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Web communities help companies create a customer-focused organization by putting employees into direct contact with consumers, as well as providing cost effective, flexible research.
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Role of Consumer-Generated Media in Marketing Research
Consumer-generated media (CGM) Is that media that consumers generate themselves and share among themselves
CGM comes from various sources: blogs, message boards, review sites, podcasts, and more.
It is trusted more than traditional advertising.
It can be influenced but not controlled by marketers.
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GOAL #4: Discuss the growing importance of
scanner-based research
Scanner-Based Research
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Chapter 9 Decision Support Systems and Marketing Research
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Scanner-Based Research
A system for gathering information from a single group of respondents by continuously monitoring the advertising, promotion, and pricing they are exposed to and the things they buy.
BehaviorScan
InfoScan
Research program that tracks the purchases of 3,000 households through store scanners in each research market
Sales-tracking service for the consumer packaged-goods industry
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Scanner-Based Research
BehaviorScan
With such a measure of household purchasing, it is possible to manipulate marketing variables, such as television advertising or consumer promotions, or to introduce a new product and analyze real changes in consumer buying behavior.
InfoScan
Retail sales, detailed consumer purchasing information (including measurement of store loyalty and total grocery basket expenditures), and promotional activity by manufacturers and retailers are monitored and evaluated for all bar-coded products.
Data are collected weekly from more than 70,000 supermarkets, drugstores, and mass merchandisers.
Chapter 9 Decision Support Systems and Marketing Research
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GOAL #5: Explain when marketing research should be conducted
When Should Marketing Research Be Conducted?
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When Should Marketing
Research Be Conducted?
Depends on managers’ perceptions of its quality, price, and timing
When the expected value of research information exceeds the cost of generating the information
Chapter 9 Decision Support Systems and Marketing Research
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Notes:
Identify customer relationships
Store and integrate
customer data using IT
Capture customer data
based on interactions
Identify best customers
Understand interactions
with current customer base
Leverage customer
information
Exhibit 9.8
A Simple Flow Model of the Customer Relationship Management System
CRM is described as a closed-looped system that builds relationships with customers.
Chapter 21 Customer Relationship Management (CRM)
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- The CRM cycle is initiated by identifying customer relationships within the organization.
- Next the company must understand the interaction each customer has with the company, building on the initial information collected and developing a useful database.
- Based on knowledge of the customer and his/her interaction with the company, the company can then acquire and capture all relevant information about the customer.
- Technology plays a critical part in a CRM system. Technology is used to store and integrate customer data.
- Not all customers are equally important to a business. Consequently, the company must use data mining to determine its profitable and unprofitable customer segments.
- Once the customer data are analyzed, they are leveraged. Data are transformed into information and disseminated throughout the organization—to the right person in the right place at the right time.
Flow Model of the Customer Relationship Management System
Goal #6: Explain the concept
of competitive intelligence
Competitive Intelligence
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Chapter 9 Decision Support Systems and Marketing Research
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Competitive Intelligence (CI)
An intelligence system that helps managers assess their competition and vendors in order to become more efficient and effective competitors.
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Sources of
Competitive Intelligence
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Internet
Company Salespeople
Industry Experts
CI Consultants
Government Agencies
UCC Filings
Suppliers
Periodicals
Yellow Pages
Trade Shows
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The Nederlander Organization
The Nederlander Organization is at the forefront of using technology to understand its customers and the ways that those theatre-goers purchase tickets. This video clip discusses specific ways the Nederlander Organization collects data and then leverages that information to the benefit of the customer.
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Review
The owner of a small chain of local coffeehouses could use _____ to determine why customers do not seem to like the location of her new coffeehouse.
transactional marketing
public relations
an EDI system
market synergy
marketing research
Marketing research has three functional roles. These roles are:
normative, descriptive, and explanatory
predictive, normative, and persuasive
descriptive, diagnostic, and predictive
flexible, interactive, and discovery-oriented
descriptive, explanatory, and predictive
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Review
Volkswagen developed an 18-month-long project to gain a better understanding of the American culture so it could develop cars more appealing to this market. The research project was called Moonraker. Moonraker was intended to play a(n) _____ role in Volkswagen’s marketing research.
- a. diagnostic
- b. descriptive
- c. predictive
- d. heuristic
- e. demonstrative
Through marketing research, the Boston Symphony Orchestra (BSO) learned it has an older market and is not attracting younger concertgoers. It next conducted marketing research to determine if an integrated advertising campaign targeted to the younger market would be successful. In its second use of research, BSO employed _____ marketing research.
historical
descriptive
predictive
normative
objective
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Review
The first step in the marketing research process is to:
specify the sampling plan
collect the data
analyze the marketplace
plan the research design
identify and formulate the problem/opportunity to be studied
A small brewery has noticed a 20 percent decrease in the sale of its dark beer over the last three years. The company’s owner wants to determine why the decline has occurred and how to reverse the trend. Once the owner has identified the problem as a consumer perception that dark beer is bitter and calorie laden, its next step in the marketing research process should be to:
collect the data
recognize the marketing problem
analyze the marketplace
plan the research design
specify the sampling plan
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Review
Data previously collected for purposes other than the one at hand are an important source of information as the researcher defines the problem. These data are called _____ data.
single-source
secondary
primary
consensual
convenience
Information collected for the first time for the purpose of solving a particular problem under investigation is called _____ data.
primary
secondary
dichotomous
observation
convenience
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Review
When Wilson, a manufacturer of tennis racquets, sent a team of researchers, designers, and tennis pros out to visit with 40 women tennis players of various abilities in locations from California to Florida to find out what women players want in a racquet, what kind of research were they conducting?
Heuristic
Primary
Cohesive
Random
Secondary
What is the chief advantage of primary data?
Low cost compared to secondary data
Answers specific research questions that secondary data cannot answer
Availability to any interested party for use
Accessibility through computerized databases
Avoiding interviewer biases
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Review
Describe survey research and explain how it differs from observation research. Name six popular forms of survey research
Survey research is the most popular technique for gathering primary data. A survey involves the researcher interacting with people to obtain facts, opinions, and attitudes.
Observation research does not rely on direct interaction with people. Popular forms of survey research include (1) in-home personal interviews, (2) mall
intercept interviews (both computer-assisted personal interviewing and computer assisted self-interviewing), (3) telephone interviews, (4) mail surveys, (5) executive interviews, and (6) focus groups.
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Review
Explain how researchers conduct an experiment and discuss the characteristic of a good experiment.
An experiment is a method for gathering primary data. It is characterized by the researcher changing one or more variables (such as price, package design, or advertising theme) while observing the effect of those changes on another variable (usually sales).The best experiments are those in which all factors are held constant except the ones being manipulated. This allows the researcher to observe the changes in the variable of interest.
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