Marketing Research Essentials

MKT202 Marketing Research Essentials

Types of Data- Secondary Workshop 3

Copyright Notice

COPYRIGHT COMMONWEALTH OF AUSTRALIA

Copyright Regulations 1969 WARNING

This material has been reproduced and communicated to you by or on behalf of Kaplan Higher Education pursuant to Part VB of the Copyright Act 1968 (the Act).

The material in this communication may be subject to copyright under the Act. Any further reproduction or communication of this material by you may be the subject of

copyright protection under the Act.

Do not remove this notice

Revision

What were the key learnings from last week?

What new information did you learn? What would you like to know more about?

Get into groups of three or four and discuss

3

This Topic’s Big Idea

“Secondary research should form the foundations of marketing research”

Learning Outcomes

1. Understand the role of secondary data 2. Identify sources of secondary data 3. Know how to transform data into

information 4. Understand how secondary data can

assist market segmentation

Types of Data

Secondary Data • Data that

have been gathered previously.

Primary Data • New data

gathered to help solve the problem under investigation.

Workshop Activity Brainstorm Session

Form pairs or small group. Collectively discuss what do you think are the

advantages and disadvantages of the two types of data?

Share your thoughts with the rest of the class.

Secondary Data • Advantages

+ Can help to clarify or refine the issue or problem

+ Might provide a solution to a research problem

+ Might provide primary data research alternatives

+ Can alert the researcher to other problems

+ Provides background information enhancing research credibility

+ Usually less expensive and faster to gather

• Disadvantages – Lack of Availability – Lack of Relevance – Data might be outdated – Inaccuracy – Might be biased--

intentionally or unintentionally

– Questionable sources – Not enough information

exists

Primary Data • Advantages

+ Gathered for a specific purpose

+ Can choose the most suitable methodology

+ Control over the process + Often more timely than

secondary research + Easier to manage bias + Can adjust research

based on findings

• Disadvantages – Can be expensive to

obtain – Typically more time

consuming than secondary data

– May require specific expertise

– Need to ensure suitable sample size and representation

Workshop Activity

Summarising Secondary data

• Watch me: https://www.youtube.com/ watch?v=t6XS5yvGp1g

Individually, note the most interesting points from the video and share these with the rest of the class upon conclusion of this activity.

10

Assessing Secondary Data

Every market researcher must ask the following questions: • Who gathered the data? • What was the purpose of the study? • What information was collected? • When was the information collected? • How was the information collected? • Is the information consistent with other

information?

11

Workshop Activity Form pairs or small groups.

Collectively, refer to the workshop aactivity handout provided under additional resources, week 3 tab in MyKBS.

Provide answers for all of the questions.

12

Internal Databases • A collection of related

information developed from data within the organisation.

• Commonly known as Customer Relationship Management (CRM)

13

Watch Me: https://www.youtube.com/ watch?v=7me7mjvTiTI

Functionality • Creation of large, up-to-

date, computerised file • Can include current, past,

or potential customers • Might be focused on

demographic/purchase behaviours

• Development of customer profile results

• Should enable one to generate direct marketing mailers /e-mails targeted at specific customers based on their buying behaviour

• Can be used to collect customer information from your website

• Should be organised to enable you to search the database using queries

• Should be compatible with database software that will enhance analysis

14

Turning Data into Information

• Data mining – The use of statistical and other advanced software to

discover non-obvious patterns hidden in a database. • Database Marketing

– Marketing that relies on the creation of a large computerised file of customers’ and potential customers’ profiles and purchase patterns to create a targeted marketing mix.

• Neural Networks – A computer program that mimics the processes of the

human brain and thus is capable of learning from examples to find patterns in data

15

Data Mining in Practice

Watch me: https://www.youtube.com/watch?time_continue=1 0&v=f2Kji24833Y

16

Market Segmentation & Sources of Information

17

Census (ABS.gov.au)Geographic • Region, county, market size, market density, climate.

Census (ABS.gov.au)Demographic • Age, gender, income, ethic background, family lifecycle.

Roy Morgan Value Segments; Primary DataPsychographic • Personality, motives, lifestyles, geodemographic (neighbourhood lifestyle

categories)

Market Segmentation & Sources of Information (cont.)

18

Industry reports; Primary DataBenefit • According to the benefits consumers seek from the product

or service

Customer Data; Primary DataUsage-rate • Amount of product or service bought or consumed.

Behavioural Targeting • Using online and offline data to

understand a consumer’s habits, demographics, and social networks in order to increase the effectiveness of online advertising.

• The average click-through rate in Google Ads is 3.17% on the search network and 0.46% on the display network.

19

Big Data • Accumulation of analysis of massive quantities of

information • Delivers deeper insights – such as all individuals,

products, events, transactions • Broader insights – finds complex, evolving and

interrelated conditions • Collects data and then tells you what it finds • Let's you answer ‘what’ rather than ‘why’

Example: When buying from Amazon it suggests other recommendations based on purchase patterns of other buyers.

20

Workshop Activity

Brainstorm Session

How is Marketing Research changing due to big data?

Share your thoughts with the rest of the class.

21

Marketing Research Aggregators

A company that acquires, catalogues, reformats, segments, and resells reports already published by marketing research firms.

Visit www.marketresearch.com and explore the available reports

When would the report be a useful investment?

22

Workshop Activity Industry Reports • Collated by industry

associations or businesses that aggregate business data

Example: IBISWorld

Form pairs or small groups and access Kaplan Library (EBSCO Database).

Download an IBISWorld report for an industry you are interested the most.

What opportunities exist in that industry?

What challenges does the industry face?

What is your assessment of the industry?

23

Online Secondary Data

• Cookies track users on websites and may determine

• Frequently visited websites • Frequent shopping patterns • Advertising engagement • Social Media such as Facebook “likes”

provide similar, trackable data to target the advertising they sell.

24

Decision Support Systems • An interactive, personalised information

management system, designed to be initiated and controlled by individual decision makers.

• Managers who use a DSS can conduct sales analyses, forecast sales, evaluate advertising, analyse product lines and keep tabs on marketing trends and their advertisers.

• Managers can follow their own train of thoughts while analysing data whether checking holiday sales or the trend for a new product launch.

25

Workshop Activity Individually, read the following case study.

Sniff Guard is a fully herbal tonic developed by Alegeno to provide cold and flu protection to Children. The

product is suitable for children between 3-12 years. The uniqueness of this product is that children are expected

to take the tonic at least once a week ideally before flu or cold symptoms appear. In essence, it is preventative drink that comes in three flavours. The product was

introduced after almost ten years of research and it is an over the counter medicine. The clinical trials and

subsequent research has indicated that the product gives 40% - 50% flu or cold protection.

Workshop Activity (cont.)

The product has been in the market for more than five years now and the sales are stagnating. Alegeno, spent significant amount on advertising, promotions through

doctors and pharmaceutical sales channels. The marketing team, with approval from government

authorities started promoting 40% - 50% success rate in their advertising though some in the team disagreed with the decision as they were not sure whether it was a good

idea to promise a number. Even with such a claim, still the sales are stagnating and the marketing team is confused as to what they should do. The board of

directors have started asking the question whether it is worthwhile continuing, given that the company is not

even close to recovering the investment.

Workshop Activity (cont.)

Firstly, the product is seasonal, the demand is mostly during the winter season, approximately four to six

months. The sales peak during three months and comes down by almost 30-40% during the next months (on average). The marketing team is of the view that the

product competes with flu injections. Given the price of flu injections, some parents have asked whether it is worth to spend more than twenty times that on Sniff Guard. Also, some say the flu jab is proven whereas 40%-50% success rate is just a number. Also, some parents have complained about their kids not keen to

drink the tonic every week due to the taste. The company has not done formal research into identifying the

strengths and weaknesses of the product yet.

Workshop Activity (cont.)

The marketing team has requested an increase in marketing budgets by almost 100%. They are of the view that if they promote the success rate and also the other benefits (i.e., all natural, the Alegeno company reputation, boost natural immunity and not immunity against selected flu strains like flu injections, etc.,)

would tip the scale and boost sales. To be fair to the marketing team, during the last five years, they had three marketing managers and the message to the

consumers have all focused on all natural nature of the product and sometimes the company sent confusing messages. The board of Directors are divided, some are of the view that this will further increase the losses and the others

want to give another chance to Sniff Guard. There is a small but loyal customer base but most customers tend to buy the product on-and-off, mostly from

discounted chemists who offer bargain prices for 24 bottle packs. Can advertising and marketing alone increase sales? – this is a question asked by one board member. If people know about the product by now (after five years)

and if most have tried (which we don’t know), then putting more money is a waste of time – just give it to charity, than wasting is the opinion of one Director.

The CEO of Alegeno is concerned and this is taking valuable time away from other issues. He has asked the marketing research manager to do a research.

“research on what?” asked the research manager from the CEO and the response was – I have no idea, do a research and tell me what to do…

Workshop Activity (cont.)

Individually, answer the following questions: 1. What is the management problem? 2. Define the marketing research problem(s). 3. Develop the marketing research objectives. 4. Explain how a marketing researcher should use the

problem definition process to answer the above questions.

5. What secondary research should Sniff Guard undertake?

Next Week

Types of Data – Primary Data, collection methods and tools: Observation and

Experimentation.