Session 4 Marketing Research Chapter 4 Marketing Research

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Session 4 Marketing Research Chapter 4

Session 4 Marketing Research Chapter 4

Marketing Research Marketing research is systematic design, collection, analysis, and reporting of data and

Marketing Research Marketing research is systematic design, collection, analysis, and reporting of data and findings relevant to a specific marketing situation facing the company. Sound decisions are based on current, accurate information 2

Uses of Marketing Research • Improve the quality of decision making • Trace problems

Uses of Marketing Research • Improve the quality of decision making • Trace problems • Find solutions • Understand the ever-changing marketing environment • etc 3

When to Conduct Marketing Research Time Constraints Is there sufficient time available before a

When to Conduct Marketing Research Time Constraints Is there sufficient time available before a managerial decision must be made? NO Availability of Data Is the information already on hand inadequate for making the decision? NO Nature of the Design Benefits Vs. Costs Is the decision of considerable strategic or tactical importance? Does the value of the research information exceed the cost of conducting research? NO Conduct Marketing Research NO Marketing Research Should Not Be Conducted 4

Four-step Marketing Research Process S 1 S 2 S 3 S 4 5

Four-step Marketing Research Process S 1 S 2 S 3 S 4 5

S 1. Problem Definition & Research Objectives Marketing Research Problem Determining what information is

S 1. Problem Definition & Research Objectives Marketing Research Problem Determining what information is needed and how that information can be obtained efficiently and effectively. Marketing Research Objective The specific information needed to solve a marketing research problem; the objective should provide insightful decisionmaking information. 6

Decision Problem vs. Research Problem • Decision Problem: − The problem facing the decision

Decision Problem vs. Research Problem • Decision Problem: − The problem facing the decision maker for which the research is intended to provide answers. − What needs to be done? • Research Problem: − A restatement of the decision problem in research terms. − What information is needed? How to obtain it? 7

Develop Research Problems • “Why are store revenues so low? ” – Discovery-oriented decision

Develop Research Problems • “Why are store revenues so low? ” – Discovery-oriented decision Problem • Possible Research Problems – Investigate current customer satisfaction – Assess target market perceptions of store and competitors – Determine target market awareness • Possible Research Problem in the Form of a Question – What are our current customer satisfaction levels? 8

Develop Research Problems • “How do we increase store traffic? ” – Strategy-oriented Decision

Develop Research Problems • “How do we increase store traffic? ” – Strategy-oriented Decision Problem • Possible Research Problems – Investigate effectiveness of different sales promotions – Determine consumer response to two proposed ad campaigns – Measure consumer preferences for new store layouts • Possible Research Problem in the Form of a Question – How effective are our different sales promotions? 9

More Examples Decision Problem: Research Problem: – Should a new product be introduced? –

More Examples Decision Problem: Research Problem: – Should a new product be introduced? – To determine consumer preferences and purchase intentions for the new product – To assess the effectiveness of the current advertising campaign – To determine the elasticity of demand the impact of different price levels on sales and profits – Why isn’t my new product selling? – Should the price of the brand be increased? 10

S 1. Problem Definition & Research Objectives • Three types of objectives – Exploratory:

S 1. Problem Definition & Research Objectives • Three types of objectives – Exploratory: define the problem & suggest hypotheses • why are consumers reluctant to sit in a car in the Mercedes show room? – Descriptive: to describe problems better • how has market share of brand X developed over the past 3 years • what is the demographic profile of customers purchasing brand X – Causal: to test hypotheses about cause-and-effect • has market share of our brand been affected by the introduction of competing brand X 11

S 2. Develop Research Plan Management problem Research objectives Information needed How the results

S 2. Develop Research Plan Management problem Research objectives Information needed How the results will help management decisions Budget 12

S 3. Collect Data: Secondary • Secondary Data: collected for other purposes – –

S 3. Collect Data: Secondary • Secondary Data: collected for other purposes – – Internal sources (e. g. previous studies) Government sources (e. g. population census) Private/commercial sources (e. g. scanner data) Internet (e. g. search engines, commercial and public DB) • Pros — Saves time and money if on target — Aids in determining direction for primary data collection — Pinpoints the kinds of people to approach — Serves as a basis of comparison for other data • Cons — May not be on target with the research problem — Quality and accuracy of data may pose a problem

S 3. Collect Data: Primary l Observation: suitable for exploratory research • Direct: observing

S 3. Collect Data: Primary l Observation: suitable for exploratory research • Direct: observing relevant consumers/actions/situations • Indirect: scanner level data on product purchases, multisource data l Survey: best for descriptive info—knowledge, attitudes, preferences, buying behavior • Structured: questionnaire • Semi-structured: focus group l Experiments: typically used for gathering causal info • Special form of observation or survey • Laboratory, e. g. , taste tests for foods • Field experiments, e. g. , test market 14

Pros of Primary Data • Answers a specific research question • Data are current

Pros of Primary Data • Answers a specific research question • Data are current • Source of data is known • Secrecy can be maintained 15

Cons of Primary Data • Expensive • Quality declines if interviews are lengthy •

Cons of Primary Data • Expensive • Quality declines if interviews are lengthy • Reluctance to participate in lengthy interviews Disadvantages are usually offset by the advantages of primary data! 16

Qualitative Research • Qualitative research – e. g. direct observation, in-depth interview, focus group

Qualitative Research • Qualitative research – e. g. direct observation, in-depth interview, focus group – If questions are asked, they are almost always open-ended or in-depth – Seeks unstructured responses that reflect the person’s thoughts and feelings on the subject • Qualitative research interprets people in the sample • Qualitative research is helpful in revealing the impact of socio-cultural factors on behavior patterns and in developing research hypotheses 17

Observational Study 18

Observational Study 18

Focus Group 19

Focus Group 19

Quantitative Research • Quantitative research – e. g. surveys and experiments – Usually a

Quantitative Research • Quantitative research – e. g. surveys and experiments – Usually a large number of respondents – Respondents answer structured oral or written questions using a specific response format (such as yes/no) or to select a response from a set of choices – Responses can be summarized in percentages, averages, statistical significance or other statistics 20

Forms of Survey Research On-Site Surveys Telephone Surveys (Home and Central Location) Mail Surveys

Forms of Survey Research On-Site Surveys Telephone Surveys (Home and Central Location) Mail Surveys Online Surveys 21

Questionnaire Design Open-Ended Question A question that encourages an answer phrased in respondent’s own

Questionnaire Design Open-Ended Question A question that encourages an answer phrased in respondent’s own words. Closed-Ended A question that asks the respondent to make a selection from a limited list of Question responses. Scaled. Response Question A closed-ended question designed to measure the intensity of a respondent’s answer. 22

Typical problems in wording questions 23

Typical problems in wording questions 23

How Questions Shape the Answer Q 10. How many hours of television do you

How Questions Shape the Answer Q 10. How many hours of television do you watch on an average week day? Please choose the category from the list below that best describes your behavior. Section 1 (Low Frequency) 86% Up to ½ an hour Section 2(High Frequency) Up to 2½ hours ½ to 1 hour 2½ to 3 hours 1 to 1½ hours 3 to 3½ hours 1½ to 2 hours 2 to 2½ hours More than 2½ hours 13% 3½ to 4 hours 4 to 4½ hours More than 4½ hours Marketer’s Question: What % of class watches more than 2. 5 hrs of TV? 24

Unaided & Aided Questions What do you consider to be the most important thing

Unaided & Aided Questions What do you consider to be the most important thing for children to prepare them for life. – ______________ – _______ 62% What do you consider to be the most important thing for children to prepare them for life. – Good education – Moral values – Good friendships – Others: ______ 5% Unaided Aided % mentioning: “To think for themselves” 25

Framing of Questions The framing effect refers to the fact that people react to

Framing of Questions The framing effect refers to the fact that people react to a particular choice in different ways depending on how it is presented. How likely are you going to Macy’s to enjoy the 50% off promotion during Thanks Giving? How likely are you going to Macy’s to save 50% during Thanks Giving? 26

Framing of Questions Identical samples of burger… … with different labels Group A “Beef

Framing of Questions Identical samples of burger… … with different labels Group A “Beef was 75% lean” Group B “Beef was 25% fat” üHigher quality üLess Greasy üBetter tasting 27

The Other People Approach: An Example Section A l Section B Q 10: How

The Other People Approach: An Example Section A l Section B Q 10: How would you describe your reaction to President Clinton’s sex life and the related scandals? Please check the category that best describes your own behavior. 3% Fascinated Mildly Curious _____ Not Interested l Q 10: How would you describe other people’s reaction to President Clinton’s sex life and the related scandals? Please check the category that best describes their behavior. 43 % 59 _____ % 38 % Fascinated Mildly Curious _____ 44 _____ % 13 % 28

Rules of Thumb about Questionnaires • • • Use simple and clear words Avoid

Rules of Thumb about Questionnaires • • • Use simple and clear words Avoid implicit alternatives Avoid implicit assumptions Avoid double-barreled questions Consider frame of reference Order of questions – Easy question at the beginning. – From general to specific. • Display – Enumerate to easy coding. – Test for quick and easy application. 29

Causal Research • What is it? – Attempt made to specify the nature of

Causal Research • What is it? – Attempt made to specify the nature of the functional relationship between two or more variables in the problem model. • Definitions – Experimentation involves the conscious manipulation of one or more variables by the experimenter in such a way that its effect on one or more variables can be measured. – A variable being manipulated is called the independent variable (a. k. a. cause). – A variable that will reflect the impact of the independent variable is called the dependent variable (a. k. a. effect). – Elimination of other possible causal factors: i. e. , the research design should rule out the factors (exogenous variables) as potentially causal ones. 30

Example 1: Simmons Beautyrest—Two Ads 31

Example 1: Simmons Beautyrest—Two Ads 31

Simmons Experimental Conditions Mean for group who saw Ad #1 = 3. 2 Mean

Simmons Experimental Conditions Mean for group who saw Ad #1 = 3. 2 Mean for group who saw Ad #2 = 4. 6 32

New Types of Lab Experiment Eye Tracking 33

New Types of Lab Experiment Eye Tracking 33

Can also be used for field experiment 34

Can also be used for field experiment 34

New Types of Lab Experiment Functional Magnetic Resonance Imaging (f. MRI) 35

New Types of Lab Experiment Functional Magnetic Resonance Imaging (f. MRI) 35

Sampling Procedure Sample A subset from a large population. Universe The population from which

Sampling Procedure Sample A subset from a large population. Universe The population from which a sample will be drawn. 36

Probability Samples Probability Sample A sample in which every element in the population has

Probability Samples Probability Sample A sample in which every element in the population has a known statistical likelihood of being selected. Random Sample A sample arranged so that every element of the population has an equal chance of being selected. 37

Nonprobability Samples Nonprobability Sample Any sample in which little or no attempt is made

Nonprobability Samples Nonprobability Sample Any sample in which little or no attempt is made to get a representative cross-section of the population. Convenience Sample A form of nonprobability sample using respondents who are convenient or readily accessible to the researcher. 38

S 4. Interpreting and Reporting Results • Analyses – Statistical analysis depending on data

S 4. Interpreting and Reporting Results • Analyses – Statistical analysis depending on data type and research question • Descriptive statistics, regression, hypothesis testing, etc. • Reporting of findings – Presentations – Memo – Final report 39