1 The research plan and process Chapter 5 Research in Marketing a Decision support system a systematic approach to collecting information to help managers make decisions 1 Companies collect customer information via sales reports purchase records and other sources to create a customer database which is then used to determine purchase patterns and profile different types of customers ii Effective support systems have three characteristics 1 The information collected must be collected systematically 2 The information collected must be relevant to specific managerial decisions so the information must have a purpose and be useful for a specific decision 3 The system should be flexible capable of being sorted manipulated totaled averaged and combined differently so that different managers can answer different questions b Market research a more general term that covers external research investigating one of three components of the market customers competitors or the company i Customer preferences on a specific brand competitive analysis and company image research c Marketing research research focused on assessing the effectiveness of a specific marketing tool or tactic i Which product features changes might increase sales the most Involves testing marketing activities to see what works and what ii doesn t d If you are a marketing manager for a chemical company when you want to hire salespeople where do you get them Hire chemistry majors and train them in selling OR Hire business majors and train them in the basics of chemistry e The market research process 6 steps i ii i Step 1 define the problem opportunity most difficult and most important step 1 Problems or opportunities can be short term and specific or long term and more general 2 A common mistake is focusing on symptoms instead of problems in this stage a Why are sales declining Why are customers switching i These are both symptoms not problems 3 It is important to involve all of those related to the problem or opportunity at the very beginning of a research project to make sure the focus is identified appropriately ii Step 2 develop a research plan Include the primary objective s goals of the research 1 2 The type of research that will be conducted 3 The information needed and how to collect it 4 How the data will be analyzed 5 The desired outcomes of the research iii Step 3 collect data 1 Data collection provides the information used to solve a specific research problem or explore a marketing opportunity 2 Firms must make a tradeoff between the complexity and the amount of information collected as this influences the cost and how long collecting may take Garbage in garbage out 3 a Research doesn t provide useful results 4 Many companies employ outside firms to perform steps 3 5 in the process a In many cases it is actually cheaper and more efficient to use resources this way since these companies specialize in research programs iv Step 4 analyze the data closely tied 1 Follows directly from the data collection step and the two are 2 Different data requires different analysis and specialized researchers should be used to analyze the data 3 This step is often done by professionals outside of the company v Step 5 prepare and present findings 1 What were the results of the research process and how should they be presented and to whom 2 The findings should be presented in a useful and effective manner to those who can use the results 3 Outside companies often prepare formal reports and make a presentation of the results for the management team a Informal reporting is often more typical in smaller companies vi Step 6 outline follow up steps and create an action plan 1 Initially includes a reflection by the manager s who initiated the research process to assess the recommendations to determine which if any will be acted upon 2 Manager assesses if the results are realistic capable of being implemented and if it is cost effective Research design will affect what information is collected Critical decisions 2 Research design a Key takeaways i ii i 1 Research goals 2 Type of research b Market research goals Exploratory research research that aims to discover insights related to a problem or opportunity 1 Goal is understanding a How do people buy 2 Typically used as a foundation for additional research 3 Goat Island Brewing Company conducts exploratory research to discover customer preferences for different beer flavors and which beers customers like to pair with specific food dishes ii Descriptive research research seeks to describe something 1 Typical goals include answering who what when and where something happened a Marketers often conduct research with descriptive goals that involve counts to understand how many customers do something or how often something happens 2 Descriptive research often leads to additional research but can also lead directly to action 3 Goat Island conducts descriptive research by surveying customers to see how many customers are willing to pay 3 50 at local pubs for a pint of its beer iii Causal research research seeks to determine the effect of one variable on another 1 Often used to explain how something will change based on 2 Does listing the most expensive item first increase or decrease marketing activities sales 3 How does the location of an item on a webpage influence the 4 sales If Goat Island tested three different labels to see which one resulted in the most sales in the supermarket this would be a causal research project because they would be trying to determine which label causes the highest sales 5 Causal goals are sometimes difficult to achieve since there are often additional variables to consider especially when researching marketing issues c Types of market research i ii goal is directly linked to research type Research Two primary options for how you conduct research research types 1 Qualitative research used by marketers to gain a more in depth understanding of a marketing problem or opportunity a Suitable for investigating underlying reasons customers do or don t do something b Researcher has specific questions or set of questions c Open ended responses d Quality responses offer deeper insight e Difficult and usually time consuming f Collecting non numerical data from customers g Research with an exploratory goal h Since qualitative research is used to explore marketing issues it is often used as a precursor to additional descriptive or causal studies using quantitative research 2