Introduction to Marketing Research

1. Introduction to Marketing Research

2. CHAPTER 1 Introduction to Marketing Research

3. Definition of Marketing Research Marketing research is the systematic and objective • identification, • collection, • analysis, • dissemination, and • use of information for the purpose of improving decision making related to the • identification and • solution of problems and opportunities in marketing.

4. Definition of Marketing American Marketing Association 1985 Marketing is the process in society and organizations of planning and executing the conception, pricing, promotion, and distribution of ideas, goods, and services to create exchanges that satisfy individual and organizational objectives. American Marketing Association 2004 Marketing is an organizational function and a set of processes for creating, communicating, and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders. American Marketing Association 2007 Marketing is an organizational function and a set of societal institutions and processes for creating, communicating, delivering, and exchanging market offerings that have value to customers and clients.

5. Classification of Marketing Research Problem Identification Research • Research undertaken to help identify problems which are not necessarily apparent on the surface and yet exist or are likely to arise in the future. Examples: market potential, market share, image, market characteristics, sales analysis, forecasting, and trends research. Problem Solving Research • Research undertaken to help solve specific marketing problems. Examples: segmentation, product, pricing, promotion, and distribution research.

6. Figure 1.3 A Classification of Marketing Research Marketing Research Problem Identification Research Problem Solving Research • Market Potential Research • Market Share Research • Image Research • Market Characteristics Research • Forecasting Research • Business Trends Research • Segmentation Research • Product Research • Pricing Research • Promotion Research • Distribution Research

7. Figure 1.4 The Marketing Research Process Step 1: Defining the Problem Step 2: Developing an Approach to the Problem Step 3: Formulating a Research Design Step 4: Doing Field Work or Collecting Data Step 5: Preparing and Analyzing Data Step 6: Preparing and Presenting the Report

9. Criteria for Selecting a Research Supplier • What is the reputation of the supplier? • Do they complete projects on schedule? • Are they known for maintaining ethical standards? • Are they flexible? • Are their research projects of high quality? • What kind and how much experience does the supplier have? Has the firm had experience with projects similar to this one? • Do the supplier's personnel have both technical and non-technical expertise? • Can they communicate well with the client? Competitive bids should be obtained and compared on the basis of quality as well as price.

10. Careers in Marketing Research • Career opportunities are available with marketing research firms (e.g., AC Nielsen, Burke, Inc., M/A/R/C) • Careers in business and non-business firms and agencies with in-house marketing research departments (e.g., Procter & Gamble, Coca-Cola, AT & T, the Federal Trade Commission, United States Census Bureau) • Advertising agencies (e.g., BBDO International, Ogilvy & Mather, J. Walter Thompson, Young & Rubicam) • Positions: vice president of marketing research, research director, assistant director of research, project manager, field work director, statistician/data processing specialist, senior analyst, analyst, junior analyst, and operational supervisor.

11. Selected Marketing Research Career Descriptions • Research Director • Also part of senior management • Heads the development and execution of all research projects • Vice President of Marketing Research • Part of company’s top management team • Directs company’s entire market research operation • Sets the goals & objectives of the marketing research department • Assistant Director of Research • Administrative assistant to director • Supervises research staff members • Senior Project Manager • Responsible for design, implementation, & research projects

12. Selected Marketing Research Career Descriptions • Senior Analyst • Participates in the development of projects • Carries out execution of assigned projects • Coordinates the efforts of analyst, junior analyst, & other personnel in the development of research design and data collection • Prepares final report • Analyst • Handles details in execution of project • Designs & pretests questionnaires • Conducts preliminary analysis of data • Statistician/Data Processing • Serves as expert on theory and application on statistical techniques • Oversees experimental design, data processing, and analysis • Junior Analyst • Secondary data analysis • Edits and codes questionnaires • Conducts preliminary analysis of data • Fieldwork Director • Handles selection, training, supervision, and evaluation of interviewers and field workers

13. Preparation for a Career in Marketing Research • Take all the marketing courses you can. • Take courses in statistics and quantitative methods. • Acquire Internet and computer skills. Knowledge of programming languages is an added asset. • Take courses in psychology and consumer behavior. • Acquire effective written and verbal communication skills. • Think creatively. Creativity and common sense command a premium in marketing research.

14. Marketing Research Associations Online Domestic AAPOR: American Association for Public Opinion Research (www.aapor.org) AMA: American Marketing Association (www.ama.org) ARF: The Advertising Research Foundation (www.amic.com/arf) CASRO: The Council of American Survey Research Organizations (www.casro.org) MRA: Marketing Research Association (www.mra-net.org) QRCA: Qualitative Research Consultants Association (www.qrca.org)

15. CHAPTER 2 Defining the Marketing Research Problems and Developing an Approach

16. Figure 2.4 Conducting a Problem Audit Figure 2.4 Conducting a Problem Audit History of the Problem Alternative Courses of Action Available to DM Criteria for Evaluating Alternative Courses Nature of Potential Actions Based on Research Information Needed to Answer the DM’s Questions How Will Each Item of Information Be Used by the DM? Corporate Decision-Making Culture

17. Table 2.1 Management Decision Problem Versus the Marketing Research Problem

18. Management Decision Problem Vs. Marketing Research Problem Management Decision ProblemMarketing Research Problem Should a new product be To determine consumer introduced? preferences and purchase intentions for the proposed new product. Should the advertising To determine the effectiveness campaign be changed? of the current advertising campaign. Should the price of the To determine the price elasticity brand be increased? of demand and the impact on sales and profits of various levels of price changes.

19. Figure 2.7 Errors in Defining the Market Research Problem Figure 2.7 Errors in Defining the Market Research Problem Common Errors • Problem Definition is too Broad • Does Not Provide Guidelines for Subsequent Steps • e.g., Improving the Company’s Image • Problem Definition is too Narrow • May Miss Some Important Components of the Problem • e.g. Changing Prices in Response to a Competitor’s Price Change.

20. Research Questions and Hypotheses • Research questions (RQs) are refined statements of the specific components of the problem. • A hypothesis (H) is an unproven statement or proposition about a factor or phenomenon that is of interest to the researcher. Often, a hypothesis is a possible answer to the research question.

21. Pop Quiz

22. Question 1. Marketing research is the systematic and objective identification, collection, analysis, dissemination, and use of information… for the purpose of improving decision making related to problem: (1)____________________ (2)____________________

23. Question 2. WHAT GOES HERE? Alternative Courses of Action Available to DM Criteria for Evaluating Alternative Courses Nature of Potential Actions Based on Research Information Needed to Answer the DM’s Questions How Will Each Item of Information Be Used by the DM? Corporate Decision-Making Culture

24. Answer 1. Marketing research is the systematic and objective identification, collection, analysis, dissemination, and use of information for the purpose of improving decision making related to the: • identification and • solution of problems and opportunities in marketing.

25. Answer 2. History of the Problem Alternative Courses of Action Available to DM Criteria for Evaluating Alternative Courses Nature of Potential Actions Based on Research Information Needed to Answer the DM’s Questions How Will Each Item of Information Be Used by the DM? Corporate Decision-Making Culture

26. CHAPTER 3 Research Design

27. Figure 3.4 A Classification of Market Research Designs Figure 3.4. A Classification of Market Research Designs Research Design Exploratory Research Design Conclusive Research Design Descriptive Research Causal Research Cross-Sectional Design Longitudinal Design

28. Table 3.2 A Comparison of Basic Research Designs TABLE 3.2 A COMPARISON OF BASIC RESEARCH DESIGNS CausalExploratoryDescriptive Objective:Discovery of Describe market Determine ideas and characteristics cause and effect insights. or functions. relationships. Character-Flexible. Marked by the Manipulation of istics: Versatile. prior formula- one or more Often the tion of specific independent front end of hypotheses. variables. total research Preplanned and Control of other design. structured mediating design. variables.

29. Table 3.2 A Comparison of Basic Research Designs (Cont.) TABLE 3.2 (Cont.) A COMPARISON OF BASIC RESEARCH DESIGNS ExploratoryDescriptiveCausal Expert surveys Secondary data Experiments Pilot surveys Surveys Case Studies Panels. Secondary data Observational and other data. (qualitative) QualitativeResearch.

30. Uses of Exploratory Research • Formulate a problem or define a problem more precisely • Identify alternative courses of action • Develop hypotheses • Isolate key variables and relationships for further examination • Gain insights for developing an approach to the problem • Establish priorities for further research

31. Methods of Exploratory Research • Survey of experts (discussed in Chapter 2) • Pilot surveys (discussed in Chapter 2) • Secondary data analyzed in a qualitative way (discussed in Chapter 4) • Qualitative research (discussed in Chapter 5)

32. Use of Descriptive Research • To describe the characteristics of relevant groups, such as consumers, salespeople, organizations, or market areas. • To estimate the percentage of units in a specified population exhibiting a certain behavior • To determine the perceptions of product characteristics • To determine the degree to which marketing variables are associated • To make specific predictions

33. Methods of Descriptive Research • Secondary data analyzed in a quantitative as opposed to a qualitative manner (discussed in Chapter 4) • Surveys (Chapter 6) • Panels (Chapters 4 and 6) • Observational and other data (Chapter 6)

34. Figure 3.5 Major Types of Descriptive Studies • Consumer Perception • And Behavior Studies • Image • Product Usage • Advertising • Pricing • Market • Characteristic • Studies • Distribution • Competitive • Analysis Sales Studies • Market Potential • Market Share • Sales Analysis Figure 3.5. Major Types of Descriptive Studies Descriptive Studies

35. Cross-sectional and Longitudinal Designs • A cross-sectional design involves the collection of information from any given sample of population elements only once. • In a longitudinal design, a fixed sample (or samples) of population elements is measured repeatedly on the same variables • A longitudinal design differs from a cross-sectional design in that the sample or samples remain the same over time

36. Figure 3.6 Cross Sectional vs. Longitudinal Designs T1 T2 Figure 3.6. Cross Sectional vs. Longitudinal Designs Sample Surveyed at T1 Cross Sectional Design Same Sample also Surveyed at T2 Sample Surveyed at T1 Longitudinal Design Time

37. TABLE 3.3 RELATIVE ADVANTAGES AND DISADVANTAGES OF LONGITUDINAL AND CROSS-SECTIONAL DESIGNS Evaluation Cross-Sectional Longitudinal Criteria Design Design Detecting change - + Large amount of data collection - + Accuracy - + Representative sampling + - Response bias + - Note: A + indicates a relative advantage over the other design whereas a - indicates a relative disadvantage. Table 3.1 Differences Between Exploratory and Conclusive Research

38. Uses of Casual Research • To understand which variables are the cause (independent variables) and which variables are the effect (dependent variables) of a phenomenon • To determine the nature of the relationship between the causal variables and the effect to be predicted • METHOD: Experiments

39. Pop Quiz 1. What are the three research designs we discussed in lecture today? 2. Define what each design does. 3. Provide an example for each of the three.

40. Answer. What are the three research designs we discussed in lecture today? Exploratory Descriptive Causal

41. CHAPTER 4 Exploratory Research DesignFocus: Secondary Data

42. Primary vs. Secondary Data Primary data are originated by a researcher for the specific purpose of addressing the problem at hand. The collection of primary data involves all six steps of the marketing research process (Chapter 1). Secondary data are data which have already been collected for purposes other than the problem at hand. These data can be located quickly and inexpensively.

43. Table 4.1 A Comparison of Primary and Secondary Data

44. Uses of Secondary Data • Identify the problem • Better define the problem • Develop an approach to the problem • Formulate an appropriate research design (for example, by identifying the key variables) • Answer certain research questions and test some hypotheses • Interpret primary data more insightfully

45. Criteria for Evaluating Secondary Data • Specifications: Methodology Used to Collect the Data • Error: Accuracy of the Data • Currency: When the Data Were Collected • Objective(s): The Purpose for Which the Data Were Collected • Nature: The Content of the Data • Dependability: Overall, How Dependable Are the Data

46. Table 4.2 Criteria for Evaluating Secondary Data TABLE 4.2 Criteria for Evaluating Secondary Data Criteria Issues Remarks _________________________________________________________________ Specifications/ Data collection method Data should be Methodology Response rate reliable, valid, Quality of data and generalizable Sampling technique to the problem Sample size at hand. Questionnaire design Field work Data analysis Error/ Examine errors in: Assess accuracy by Accuracy Approach, Research design, comparing data Sampling, Data collection, from different Data analysis, Reporting sources. Currency Time lag between collection Census data are and publication. periodically Frequency of updates updated by syndicated firms

47. TABLE 4.2 (Continued) Criteria for Evaluating Secondary Data Criteria Issues Remarks ________________________________________________________________ Objective Why were the data The objective will collected? determine the relevance of data. Nature Definition of key variables Reconfigure the Units of measurement data to increase Categories used their usefulness, Relationships examined if possible. Dependability Expertise, credibility, Data should be reputation and obtained from an trustworthiness of the original rather source. than an acquired source.

48. Internal Secondary Data Department Store Project Sales were analyzed to obtain: • Sales by product line • Sales by major department (e.g., men's wear, house wares) • Sales by specific stores • Sales by geographical region • Sales by cash versus credit purchases • Sales in specific time periods • Sales by size of purchase • Sales trends in many of these classifications were also examined.

49. Internal Secondary DataExample Retail Link Dataset

50. Type of Individual/Household Level Data Available from Syndicated Firms I.Demographic Data - Identification (name, address, telephone) - Sex - Marital status - Names of family members - Age (including ages of family members) - Income - Occupation - Number of children present - Home ownership - Length of residence - Number and make of cars owned