Marketing Research: Gathering, Analyzing, and Using Information

1. Marketing Research: Gathering, Analyzing, and Using Information

2. Chapter Objectives • Explain the role of the marketing information system and the marketing decision support system in marketing decision making • List and explain the steps in the marketing research process • Appreciate the differences among exploratory, descriptive, and casual research • Describe the different types of data-collection methods and types of consumer samples that research use • Understand the impact of the growing use of online research

3. Real People, Real Choices • Meet Cindy Turgate at Plan-it Marketing, a marketing research firm • Priceline needed help in planning its business. Would its name-your-own-price strategy fly? • The decision: What marketing research strategy would maximize results 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

4. Knowledge is Power • Accurate, up to date, relevant information is the fuel that runs the marketing engine

5. The Marketing Information System • Determines what information marketing managers need, then gathers, sorts, analyzes, stores, and distributes information to system users Figure 4.2

6. Internal Company 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.

7. HSX.COM Marketing Intelligence • Monitoring everyday sources and using “mystery shoppers” • Futurists specialize in predicting consumer trends

8. GfK ARBOR LLC • MEDIAMARK RESEARCH Marketing Research • Collecting, analyzing, and interpreting data about customers, competitors, and the business environment to improve marketing effectiveness • Syndicated research • Custom research

9. Acquired Databases • From other companies • Government databases • Misuse of databases can be problematic and has led to do-not-call lists and antispam laws

10. Marketing Decision Support Systems • MDSS: data plus analysis and interactive software allow marketing managers to access MIS data and conduct analyses Figure 4.3

11. Searching for Gold: Data Mining • Analysts sift through data to identify unique patterns of behavior among different customer groups

12. What Marketers Can Do with Data Mining • Customer acquisition • Customer retention and loyalty • Customer abandonment • Market basket analysis

13. 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 • Step 2: Determine the Research Design • Specifying exactly what information marketers will collect and what type of study they will do

14. Figure 4.5:Marketing Research Design

15. Secondary Versus Primary Research • Secondary data have been collected for some purposes other than the problem at hand • Primary data is information collected directly from respondents to specifically address the question at hand

16. MARKETINGTOOLS.COM • CENSUS.GOV • DIALOG.COM • LEXIS-NEXIS Secondary Research Web Sites

17. LOOK-LOOK.COM Exploratory (Qualitative) Research • Research techniques that generate insights for future, more rigorous studies • Researchers conduct one-on-one discussions with consumers • Focus group: a product-oriented discussion among a small group of consumers

18. Exploratory (Qualitative) Research (cont’d) • Projective techniques: participants respond to some object • Case study: comprehensive examination of a particular firm • Ethnography: Marketers visit homes or participate in consumer activities to learn how products are used Wild Planet Video

19. Group Activity • Break into small groups and pick a product category of interest • Assume a company wants to create a new or modified product to compete for market share in that category • Create a couple of questions for a focus group moderator to guide discussion • Each group sits with another group and takes turns conducting an informal focus group

20. Descriptive (Quantitative) Research • Probes systematically into the problem • Bases conclusions on large numbers of observations • Results typically expressed in quantitative terms (averages, percentages, other stats) • Cross-sectional design • Longitudinal design

21. 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

22. Steps in the Marketing Research Process (cont’d) Step 3: Choose the Method for Collecting Primary Data • Survey Methods: interview respondents • Questionnaires: loosely, moderately, or completely structured

23. Questionnaires • Mail questionnaires • Telephone interviews • Face-to-face interviews • Online questionnaires

24. Discussion • Are you willing to divulge personal information to marketing researchers? • How much are you willing to tell? • Where would you draw the line?

25. Group Activity • In small groups, choose a topic below and analyze the advantages and disadvantages of mail questionnaires, telephone interviews, face-to-face interviews, and online questionnaires: • The amount of sports nutrition drinks consumed in a city • Why a local bank has been losing customers • What local doctors would like to see changed in hospitals • Consumers’ attitudes toward several sports celebrities

26. Observational Methods • Observation: data collection where the researcher records consumers’ behaviors, often without their knowledge • Personal observation • Mechanical observation • Unobtrusive measures

27. Discussion • Do you think marketers should have to right to go through a competitor’s garbage? Is it ethical?

28. Data Quality:Garbage In, Garbage Out • How much faith should marketing managers place in research? • Validity • Reliability • Representativeness

29. Discussion • Do you think marketers should be allowed to conduct market research with young children? Why or why not?

30. Reality TV: Group Activity • Each group comes up with a new “Reality TV” show… • Design a short survey to get information to help you develop the best show • Hand it out to your classmates to complete • Use the information to create your show • Describe your thoughts, feelings, and behaviors during this activity

31. Online Research • Information gathered via consumer surfing and Web site/email/chat room questionnaires/focus groups • Cookies allow a Web sponsor to track a surfer’s moves

32. ITRACKS.COM • THERE.COM Online Research Applications • New product development • Estimating market response • Exploratory research (online focus groups) • IM (Instant Messaging)

33. Advantages of Online Data Collection • The same amount of data in a fraction of the time • Convenience of survey completion • Elimination of interviewer bias and data entry errors

34. Disadvantages of Online Data Collection • Non-representativeness of respondents • Limited computer access for poor and elderly • Self-selection bias (people who like to take part in online studies) • Hackers and competitors influencing/intercepting results

35. Step 4: Design the Sample • Probability sample • Each member of the population has some known chance of being included • Sample is representative of population, and inferences about population are justified • - Simple random sampling • - Systematic sampling • - Stratified sampling

36. Step 4: Design the Sample (cont’d) • Nonprobability sample • Personal judgment used in selecting respondents • Some members of population have no chance of being included • No way to ensure that sample is representative of population • *Christine: next two should be lower-level (black)* • Convenience sampling • Quota sampling

37. Discussion • Why wouldn’t you select all the individuals or elements of a population to be in your study?

38. Step 5: Collect the Data • Challenges to gathering data in foreign countries • Differences in sophistication of research operations • Infrastructure/transportation challenges • Lack of phones • Low literacy rates • Local customs and cultural differences • Language translation difficulties

39. Group Activity • Break into small groups and choose one of the following countries. Generate a list of difficulties a firm would expect to encounter when developing plans for marketing research: • South Africa • Spain • China • Saudi Arabia • Canada • Argentina • Australia • Germany

40. Step 6: Analyze andInterpret the Data • Data need analysis for them to have meaning • 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

41. Table 4.4: Data Tabulation and Cross-Tabulation Tables

42. Step 7: Prepare the Research Report • Executive summary • Description of research methodology • Discussion of results including tabulations, cross-tabulations • Limitations of study • Conclusions and recommendations

43. Discussion • What is your overall attitude toward marketing research? • Do you think it is a beneficial activity from a consumer’s perspective? • Or do you think it merely gives marketers new insights on how to convince consumers to buy something they really don’t want or need?

44. Real People, Real Choices • Plan-it Marketing (Cindy Turgate) • Cindy chose option 3: conduct viability study with both qualitative exploratory study and confirmatory quantitative study • Priceline.com was launched nationally in April 1998, and it continues to flourish

45. Marketing Plan Exercise • Select a company that makes a product you use. For the firm you selected: • Define one specific problem it could address through marketing research • What type of research design do you recommend for addressing that problem, and why? • What is the most appropriate way to collect the data? Justify your choice • How will you ensure high validity, reliability, and representativeness of the data? • Design an appropriate sampling plan

46. Marketing in Action Case:You Make the Call • What is the decision facing Acxiom? • What factors are important in understanding this decision situation? • What are the alternatives? • What decision(s) do you recommend? • What are some ways to implement your recommendation?

47. Keeping it Real: Fast Forward to Next Class Decision Time at Wild Planet • Meet Danny Grossman, CEO and founder of Wild Planet Toys. • Room Gear: a product line that lets kids decorate their rooms met with sharply different gender appeals • The decision: the future direction of the Room Gear line