BUSML 4202 Class Notes The Purpose of Marketing Research Nature of Marketing o Marketing The process of planning and executing the conception pricing promotion and distribution of ideas goods and services to create exchanges that satisfy individual and organizational objectives The right goods to the right people at the right time using the right price and right promotion technique o The Marketing Concept The marketing concept A business philosophy based on 1 consumer orientation 2 goal orientation and 3 systems orientation Consumer Orientation The identification of and focus on the people or firms most likely to buy a product and the production of a good or service that will meet their needs most effectively A focus on the accomplishment of corporate goals a limit set Goal Orientation on consumer orientation Systems Orientation The creation of systems to monitor the external environment and deliver the desired marketing mix to the target market o Opportunistic Nature of Marketing Research Marketing research is an excellent tool for discovering opportunities in the marketplace Can identify the market leaders determine why specific brands are popular ascertained market segments for new products and determined the growth segment o External Marketing Environment Marketing mix The unique blend of product service pricing promotion and distribution strategies designed to meet the needs of a specific target market Overtime the marketing mix must be altered because of changes in the environment Mgmt must understand the external environment in order to plan for the future and forces that influence their future Marketing research is key to understanding the environment and identifying the marketing mix new opportunities Marketing Research and Decision Making o Marketing research plays two key roles Provides decision makers with data on the effectiveness of the current marketing mix and offers insights into necessary changes Primary tool for exploring new opportunities in the marketplace o Marketing research The planning collection and analysis of data relevant to marketing decision making and the communication of the results of this analysis to management Three functional roles Descriptive function o The gathering and presentation of statements of fact Diagnostic function Predictive function o The explanation of data or actions o Specification of how to use descriptive data and diagnostic research to predict the results of a planned marketing decision o Return on quality Mgmt objectives based on the principles that 1 the quality being delivered is at a level desired by the target market and 2 the level of quality must have a positive impact on profitability o There is an inextricable link between customer satisfaction and customer Long term relationships are grounded in the delivery of service and loyalty value Customer retention pays big dividends repeat sales and referrals Big impact on the value of the firm o Marketing research helps mgmt understand the ever changing marketplace Helps to understand trends and take advantage of opportunities o Social Media and User Generated Content Blogs forums online communities and product service reviews AND social media sites that created UGC Opinions expressed are unsolicited typically honest candid and passionate Has brought lots of changes to the marketplace o Proactive Role of Marketing Research Can be proactive by having a thorough knowledge of factors that have an impact on the target market marketing mix Proactive mgmt alters the marketing mix to fit new patterns Marketing strategy A plan to guide the long term use of a firm s resources based on its existing and projected internal capabilities and on projected changes in the external environment Meet long term profits and market share goals o Applied Research VS Basic Research Applied Research aimed at solving a specific pragmatic problem o Nature of Applied Research Basic Pure Better understanding of the marketplace determination of why a strategy or tactic failed or reduction of uncertainty in mgmt decision making Research aimed at expanding the frontiers of knowledge rather than solving a specific pragmatic problem Constructed to validate an existing theory Programmatic research research conducted to develop marketing options through market segmentation market opportunity analyses or consumer attitude and product usage studies Comes from mgmt s need to obtain a market overview periodically Selective research research used to test decision alternatives Conducted when several viable options have been identified by programmatic research Evaluative research research done to assess program performance Need comes from when the effectiveness and efficiency of a marketing program needs evaluation o Decision to Conduct Marketing Research When to not conduct research Resources are lacking o Lack of funds to do the research properly o OR appropriate amount of funds to complete research but not enough money to implement decisions Research results would not be useful The opportunity has passed The decision already has been made Managers cannot agree on what they need to know to make a decision Decision making information already exists The costs of conducting research outweigh the benefits Development of Marketing Research o Inception Pre 1900 First recorded marketing research survey taken in July 1824 Election poll with Andrew Jackson First marketing researcher John Jacob Astor First documented use of marketing research to make informed decisions 1879 N W Ayer advertising agency Academic researchers entered into marketing research when Harlow Gale Prof of psychology at University of Minnesota introduced use of mail surveys o Early Growth 1900 1920 Consumer demand surged after the turn of the century Thus need arose to understand consumers buying habits and attitudes toward manufactures wares First formal marketing research department Curtis Publishing Company in 1911 Focus on the automobile industry o Adolescent years 1920 1950 Percival White developed the first application of scientific research to commercial problems 1930 s widespread use of survey research Marketing research also now taught at colleges Social media and WWII made marketing research an official profession Categorization of responses income gender family status 1940 s focus groups developed Robert Merton o Mature Years 1950 2000 Change from seller s market to buyer s market Created need for better intelligence Concept of market