Chapter 5 Marketing Research and Information Systems 5 1 The Importance of Marketing Research Marketing Research the design collection interpretation and reporting of information to help marketers solve specific marketing problems or take advantage of marketing opportunities Poor economy necessitates quick reactions to changing marketing environment and trends marketing research is thus more important than ever o More families prefer dinners in 15 30 minutes supermarkets respond by offering more heat and eat options Cluster Analysis statistical analysis technique that identifies consumer segments o Measures price sensitivity importance on quality etc 5 2 Types of Research Two forms of marketing research data numbers Two forms of research 1 Qualitative Data yields descriptive non numerical information 2 Quantitative Data yields empirical information that can be communicated through 1 Exploratory Research general to generate insights about a situation 2 Conclusive Research specific to verify insights and aid in selecting a course of action 5 2A Exploratory Research hypothesis more specific Used when marketers need more information about a problem or want to make a tentative o Example Businesses found out through exploratory research that consumers perceive clearance to mean bigger discounts than sale Customer Advisory Boards small groups of actual customers who serve as sounding boards for new ideas and offer insights into their feelings toward a firm s products promotion pricing and other elements of marketing strategy Focus Group brings together multiple people to discuss a certain topic in a group setting led by a moderator o Conducted informally o Can provide companies with ideas for new products o Example Netflix has used focus groups extensively in the past to test new product ideas o Online focus groups collect data over a larger geographical area o Provide qualitative NOT quantitative data 5 2B Conclusive Research Used to verify insights through an objective procedure to help marketers make decisions Used when there is one or more alternatives in mind not simply a need for information Descriptive Research help marketers understand the characteristics of certain phenomena to solve a particular problem o Surveys of customer education occupations or ages o Prior knowledge is needed and assumes that the problem or issue is clearly defined o Example Nike asking young women of a certain age how many pairs of shoes they buy per year Experimental Research allows marketers to make causal deductions about relationships o Requires that an independent variable be manipulated and the resulting changes in a dependent variable be measured Example Coca Cola changing price of Dasani flavored water but kept the shelf location and advertising the same in different markets and measured the effect of changing price on sales profit 5 3 The Marketing Research Process Approaching marketing research 1 Locating and defining problems or issues 2 Designing the research project 3 Collecting data 4 5 Reporting research finding Interpreting Results 5 3A Locating and Defining Problems or Research Issues Problems identified by a failure to attain objectives Conversely increased sales should encourage an organization to identify opportunities Marketing managers and marketing researchers need to communicate effectively 5 3B Designing the Research Project Research Design an overall plan for obtaining the information needed to address it o Formulation of a hypothesis and determining what type of research is appropriate Developing a hypothesis Research Reliability and Validity o Hypothesis is an informed guess or assumption about a certain problem o Reliability if a technique produces almost identical results in repeated trials o Validity the research method must measure what it is supposed to measure 5 3C Collecting Data Primary Data observed and recorded collected directly from respondents o Lengthier and more expensive process than collecting secondary data Sampling procedures survey methods observations Can be handled by the business by itself or by other businesses that do it for them o Population includes all the elements units or individuals of interest to researchers for a specific study o Sample a component that represents the population o Probability Sampling every element in the population being studied has a known chance of being selected for study Random Sampling all the units in a population have an equal chance of appearing in the sample a type of probability sampling Stratified Sampling the population of interest is divided into groups according to a common attribute and a random sample is then chosen within each group o Nonprobability Sampling more subjective there is no way to calculate the likelihood that a specific element of the population being studied will be chosen Sampling error CAN NOT be measured statistically Quota Sampling researchers divide population into groups then arbitrarily choose participants from each group controls usually are age race gender Often used for exploratory studies Secondary Data compiled both inside and outside the organization o General reports supplied to an enterprise by various data services and databases o Include market share retail inventory levels o Internal Sources Accounting records Sales force data o External Sources Trade associations periodicals government publications online databases etc May use public demographic data to determine whether to set up shop in a particular area Marketing businesses such as Information Resources Inc IRI tracks retail sales and can sell information to businesses Google company websites Monitoring consumer blogs Survey Methods o Mail telephone personal or online interviews etc that analyze consumer behavior o Mail Survey used if sample is spread over wide area and funds are limited Low response rate Offering bonuses coupons improves response rate o Telephone Survey rate of response is higher than mail survey less effort Very quick o Personal Interview Survey face to face interviews Advantageous because of the inclusion of facial and audiovisual aids In Home Interview thoroughness of self disclosure and elimination of group influence are important Shopping Mall Intercept Interviews better when bulky equipment is required On Site Computer Interview can be done in shopping malls as well Respondents proceed at their own pace Uses software o Online and Social Media Surveys Questionnaires transmitted to respondents via
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