Defining the Problem and Determining Research Objectives The

Defining the Problem and Determining Research Objectives

The Importance of Properly Defining the Problem • Properly defining the problem is the most important step in the marketing research process. • If the wrong problem is defined, all the remaining steps in the marketing research process are wrong. Ch 4 2

Define the Problem • Two sources of problems: – A problem exists when a gap exists between what was supposed to happen and what did happen, i. e. , failure to meet an objective. – An opportunity occurs when there is a gap between what did happen and what could have happened…called an opportunity. Ch 4 3

Define the Problem Ch 4 4

Recognizing the Problem • To recognize a problem, managers must be knowledgeable of objectives and actual performance. • To be aware of opportunities, managers must have a process for monitoring opportunities, such as opportunity identification. Ch 4 5

The Role of Symptoms in Problem Recognition • “We have a problem … we are losing money” – Managers must be careful to avoid confusing symptoms with problems. Ch 4 6

The Role of Symptoms in Problem Recognition • Symptoms are changes in the level of some key monitor that measures the achievement of an objective. • The role of the symptom is to alert management to a problem; there is a gap between what should be happening and what is happening. Ch 4 7

The Role of the Researcher in Problem Definition • Researchers should ensure managers are defining the problem correctly. • This is particularly true when the manager has already defined the problem in very specific terms. • Researchers sometimes take additional investigations, known as a “situation analysis, ” to ensure the Ch 4 8 problem is adequately defined.

Impediments to Problem Definition • Failure to change behavior for problem definition situations – Managers deal with outside suppliers efficiently with little interaction. Marketing research requires a great deal of interaction and communication. Ch 4 9

Impediments to Problem Definition • There are differences between managers’ and researchers’ backgrounds. – Traditionally researchers were technicians and managers were trained in general decision making. – Today managers are much more aware of technical software such as using your SPSS. Ch 4 10

The Role of ITBs and RFPs • ITBs are Invitations to Bid. • RFPs are Requests for Proposals. • When ITBs and RFPs are issued management has already defined the problem. • Phony ITBs and RFPs present an ethical problem in the marketing research industry. Ch 4 11

Defining the Problem & Establishing Research Objectives • A Process: – There is no universally accepted, step-by-step approach used by marketing researchers to define the problem and establish research objectives. • “Defining problems accurately is more an art than a science. ” – Lawrence D. Gibson Ch 4 12

Assess the Background and the Manager’s Situation • The researcher should first understand the industry, the competitors, and the company. • The researcher must understand the manager’s unique situation… – Does the manager have a particular objective? – What constraints is the manager operating under? Ch 4 13

Clarify the Symptoms of the Problem • The researcher must understand the control system and determine what symptoms are being identified by the system. Ch 4 14

Pinpoint Suspected Causes of the Symptom • There’s always some cause or causes for a change. • It is important to determine all possible causes. • Researchers should narrow possible causes to a small set of probable causes. Ch 4 15

University Estates – Problem Definition & Research Objectives • Situation: Last year, University Estates (which targets mainly university students) experienced a decline in its occupancy rate from 100% to 80%. • Manager & Researcher brainstorm a list of POSSIBLE CAUSES Wait! You give it a try. Ch 4 16

University Estates – Problem Definition & Research Objectives • What are some possible cases for University Estates’ Occupancy Decline? Ch 4 17

University Estates – Problem Definition & Research Objectives Ch 4 18

University Estates – Problem Definition & Research Objectives • What is/are the probable cause(s) for University Estates Occupancy Rate Decline? – Something that changed just before or at the same time as the symptom(s). • If it did not change, how could it cause the symptom? Ch 4 19

University Estates – Problem Definition & Research Objectives • Probable Causes for University Estates Occupancy Rate Decline 1. Competitor’s Actions Basic Cable TV 2. Consumers (Current and Prospective Student Renters) No change 3. University Estates Itself No change 4. The Environment No change Ch 4 Probable Cause 20

University Estates – Problem Definition & Research Objectives • What can University Estates do? Add Satellite TV 150 channels 4 Premium channels Pay-for-view Ch 4 21

Specify Possible Solutions that May Alleviate the Symptoms • Possible solutions include any marketing action that the marketing manager thinks may solve the problem, such as price changes, product modification, etc. Ch 4 22

Speculate on Anticipated Consequences of the Solutions • “What if” questions should be made regarding possible consequences of each marketing action being considered. Ch 4 23

Identify Manager’s Assumptions about Solutions’ Consequences • Assumptions are assertions that certain conditions exist or certain reactions will take place if considered solutions are implemented. • If the manager is completely certain of assumptions there is no need for research. Ch 4 24

Identify Manager’s Assumptions about Solutions’ Consequences • For those uncertain assumptions, research will eliminate a manager’s uncertainty and therefore aid in decision making. Ch 4 25

The Role of Hypotheses in Defining the Problem • Hypotheses are statements that are taken for true for the purposes of argument or investigation. • Assumptions about the consequences of solutions are hypotheses. Ch 4 26

The Role of Hypotheses in Defining the Problem • When a manager makes a statement or an assumption that he/she believes to be true and wants research to determine if there is support for that statement, we call this statement a hypothesis. Ch 4 27

Assess the Adequacy of Information on Hand • To specify research objectives – The information state should be assessed. – The information state refers to the quantity and quality of evidence a manager possesses for each of his or her assumptions. – Information gaps are discrepancies between the current information level and the desired information Ch 4 28 level.

Assess the Adequacy of Information on Hand • To specify research objectives – Information gaps are the basis for establishing research objectives. – Research objectives are set to gather the specific bits of knowledge that need to be gathered in order to close the information gaps. Ch 4 29

University Estates – Problem Definition & Research Objectives • Information Gaps (Management Questions) and Research Objectives for University Estates Information Gap/Question Ch 4 Research Objective(s) How will prospective residents react to the inclusion of the satellite television programming package with the base apartment? To what extent do prospective student residents want satellite television? Will University Estates be more competitive if it adds a satellite television package? Will University Estates be more attractive than competing apartment complexes if it has the satellite television programming package? 30

Review! • How to get research objectives from management questions. – State the marketing management question. – List the specific pieces of information needed to answer the question. – Do this for each and every management question. Ch 4 31

The Marketing Research Proposal • Three functions: – It states the problem. – It specifies the research objectives. – It details the research method proposed. • Proposals also contain a timetable and a budget. Ch 4 32

Research Objectives • • Ch 4 Precise Detailed Clear Operational – Operational definitions describe the operations to be carried out in order for constructs to be measured. 33

The Role of Constructs • A construct is an abstract idea inferred from specific instances that are thought to be related. • Typical marketing constructs are brand loyalty, satisfaction, preference, awareness, knowledge. • Research objectives typically call for the measurement of constructs. • There are customary methods for defining and measuring constructs. Ch 4 34

Constructs CONSTRUCT Brand awareness OPERATIONAL DEFINITION Question: Have you heard of Brand A? ____ Yes ____ No Measure: Percentage of respondents having heard of the brand Recall, recognition of advertising Question: Do you recall seeing an advertisement for Brand A? Measure: Percentage who remember seeing a specific ad Knowledge of product features Question: Indicate which of Brand A’s features you know about. Measure: Percentage who know about each feature Brand familiarity Question: Are you “unfamiliar, ” “somewhat familiar, ” or “very familiar” with Brand A? Measure: Percentage for each familiarity category Comprehension of product benefits Question: For each product benefit statement, indicate if you agree or disagree. Measure: Percentage who agree with each benefit statement 35 Ch 4

Constructs CONSTRUCT Attitudes, feelings toward brand OPERATIONAL DEFINITION Question: Rate Brand A on a 1– 5 scale, where 1 = “poor” and 5 = “excellent” Measure: Average rating Intentions to purchase Question: What is the probability that you will buy Brand A the next time you purchase this product? Measure: Average probability Past purchase or use Question: Have you used Brand A in the past three months? Measure: Percentage who have used it Brand loyalty Question: With your last five purchases of the product, how many times did you buy Brand A? Measure: Percentage of times Satisfaction Question: Rate Brand A on a 1– 5 scale, where 1 = “unsatisfied” and 5 = “very satisfied” Measure: Average rating 36 Ch 4

• A model is a logical arrangement of constructs and relationships based on theory or experience – Hierarchy of Effects • Unaware-Aware-Knowledge-Liking. Intention-Purchase-Loyalty – Importance-Performance Model • Importance: Performance on attributes Ch 4 37

– Segmentation Model • Divide up the market based on demographics, etc. – Company Performance Model • Sum of evaluations on various attributes Ch 4 38

HIERARCHY STAGE DESCRIPTION RESEARCH QUESTION (University Estates Example) Unawareness Not aware of your brand What percentage of prospective student residents are unaware of satellite television? Awareness Aware of your brand What percentage of prospective student residents are aware of satellite television? Knowledge Know something about your brand What percentage of prospective student residents who are aware of it know that satellite television (1) has 150 channels, (2) premium channels, and (3) pay-for-view? Liking Have a positive What percentage of prospective student feeling about your residents who know something about brand satellite television feel negatively, positively, or neutral about having it in their apartment? Intention Intend to buy your brand next What percentage of prospective student residents who are positive about having satellite television in their apartment intend to rent an apartment with it? Purchase* Have purchased your brand in the past What percentage of the market purchased (tried) your brand in the past? Ch 4 Repurchase/ Loyalty* Purchase your brand regularly What percentage of the market has purchased your brand more than other brands in the last five purchases? 39

Ch 4 40