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4. Marketing research. After carefully studying this chapter, you should be able to: Define marketing research; Identify and explain the major forms of marketing research; Distinguish quantitative and qualitative data; Explain the use of secondary and primary research;
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4. Marketing research • After carefully studying this chapter, you should be able to: • Define marketing research; • Identify and explain the major forms of marketing research; • Distinguish quantitative and qualitative data; • Explain the use of secondary and primary research; • Describe the key methods of data collection; • Explain random and quota sampling.
2.1 Marketing research defined • The American Marketing Association defines marketing research as: • The systematicgathering, recording and analysing of data about problems relating to the marketing of goods and services.
4.1.1 Purpose of marketing research • Marketing research provides data that contains information to help managers take decisions. • Marketing research does not provide solutions. • Research, and researchers, do not take decisions. They plan and carry out the research. • It’s the manager who commissions the research that has to decide how to use the data, and how to extract the information he needs.
4.1.2 Constraints of marketing research • CATS: • C – Cost • A – Accuracy • T – Time • S – Security
Cost • The cost of conducting the research must be less than the value of the information provide. • Accuracy • Inaccurate result will have no value.
Time • The research must be completed before the decision must be taken. • Security • We must not let competitors hear about what we plan to do.
4.2 Types of marketing research • Be careful to use the terms carefully: • Marketing research describes the range of research that is used by marketing managers. • Market research is one of the many types of marketing research.
4.2.1 Market research • The systematic analysis of a single market. • A market research could provide the following data: • Estimated size of the total market. • Estimates of the location and size of potential markets. • trends and changes. • Identification of specific market characteristics. • Sales forecasts.
4.2.2 Competitor research • There aredirectandindirectcompetitors. • Competitor information should include: • The strength and weakness of their product offers, resources and key personnel. • Pricing, distribution and promotional strategies. • Their relationships with suppliers. • The speed, timing and reliability of their delivery service.
4.2.3 Promotional research • Promotion can be seen as communication. • Promotional research is used to check things like: • Target audience identification. • How to get a message across to the target audience(s). • The number or times to repeat the message. • Media cost and effectiveness. • The results achieved.
4.2.4 Retail audits Past stocks + Purchases － Present stocks = Sales Count the opening stock = 10,000 Go away. 6 weeks later: Count the deliveries made in the 6 weeks: 2,000 + 2,500 + 2,700 + 2,200 = 9,450 Total stocks in period = 19,450 Count stock in the shop = 9,235 Deduct from total stock to give sales = 10,215
4.2.5 Other forms of marketing research • Distributor research finds out the most cost-effective way of distribution. • Pricing research discovers what customers and consumers feel is good value. • Product research carries out evaluation of own and competitors product offers. • Sales research locates potential new customers.
Remember: • The marketing professional specifies the questions that need to be answered. • Researchers decided how to carry out the research and which research tools to use in order to provide the answers.
4.3 Quantitative and qualitative data • 4.3.1 Quantitative data • Deals with numbers and hard facts. • 4.3.2 Qualitative data • Deals with opinions and subjective issues. • Dustbin survey (p.75) • Getting facts indirectly (p.75)
4.3.3 The 3As • Awareness – Attitude – Action • Marketers must first make the customers become aware of the product offer(s). • Then the marketers have to try to develop a positive attitude within the minds of customers. • Only then will the customer take action.
4.3.4 Measuring feelings and opinions • Likert scaling • The researcher presents some statements, and ask respondents to say for each statement whether they: • 5 – Agree strongly • 4 – Agree • 3 – Are uncertain • 2 – Disagree • 1 – Strongly disagree • The higher the score the more agreement there is with the statement.
Osgood scaling • This rating scales are more open than Likert’s. • It uses adjectives that have a universal understanding. • Originally Osgood has 20 rating scales (p.77) • But researchers can use any adjectives that meet their needs. • It can also be done easily (see p.78)
4.4 Secondary and primary research • Secondary research • looks at data that already exists. • is also called Desk research, because it can be done with PCs on our desks. • Primary research • looks for data that have not been found in the secondary research. • is also called Field research, because it is conducted outside the office.
Remember: • Always use secondary research first. • Then use primary research to fill the information gaps that the secondary research left.
4.5 Data collection • The three basic methods for gathering data are: • Observation • A researcher watches what happens. • Experimentation • A situation is created and the results measured. • Questioning • Direct contact, face-to-face, over the phone, by post.
4.6 Random and quota sampling • Why sampling? • It is not possible to interview every person, so a way must be found to interview only some – yet get results that are reliable. • There are various statistical software which can help you with this.
Probability / random sample: • First, identify every individual. • Then every person has an equal chance of being selected, at random, like in a lottery draw. • The problems are: • The selected ones may be widespread. It is time-consuming and costly to visit each one. • Random sampling is often used in quality control, but not in marketing research.
Quota sample: • A quota sample represents the make-up of the whole. • See the example on p.82 • Quota sampling is widely used in marketing research because it is cost effective and useful. • Error: • There will always be a degree of error in any research findings. Usually in marketing research this is plus or minus 5%.
