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Chapter 3

The Marketing Research Process and Defining the Problem and Research

Objectives

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Learning ObjectivesDiscuss the steps in the marketing research process Understand when marketing research is not neededProperly identify & formulate a research problem

based on problematic management symptomsFormulate proper research objectives that addresses an

identified research problemComment on the nature and contents of a research

proposal

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The Marketing Research Process

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The marketing research process: It is a process and therefore there are a series of steps These steps provides a road map for planning a research project Why are steps important in research projects:

Gives both researchers & non-researchers an overview of the process

Provide the researcher with tasks to complete and in what order Owing to the step-by-step approach in research, there are some

caveats (cautions): Not always presented as an 11-step process (can also be 3 steps: define,

collect, present) Not all studies use all 11 steps (You may be able to solve the problem

with secondary data - a visit to the library or Google™) Few studies follow the steps in order (the steps are often interrelated –

going back and revisiting a previous step) Understanding the steps in the process is a foundation for learning

to conduct marketing research.

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Step 1: Establish the Need for Marketing Research Is there a real need for marketing research?

Marketing research is not always needed. We often have the information.

Research takes time and costs money. Value of information versus cost of information?

Most situations do not require research, if they did, managers would be doing research and not making timely decisions.

Management must make a decision about the role they wish marketing research to play in their organisation (not all managers believe in research).

When is marketing research not needed? The information is already available. The timing is wrong to conduct marketing research. Funds are not available for marketing research. Costs outweigh the value of marketing research.

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Step 2: Define the Problem –Stating the Decision Alternatives This is the most important of the 11 steps (assuming we’ve decided to do

marketing research!). If the problem is incorrectly defined, all else is wasted effort. The need to make a decision requires decision alternatives. If there are no

alternatives, no decision is necessary. Problems are situations calling for managers to make choices among

decision alternatives. Research objectives are specific and tell the researcher exactly what

information must be collected to solve the problem by facilitating selection of an alternative.

A research objective should satisfy 4 criteria (p. 78): Specify from whom information is to be gathered Specify what information is needed Specify the unit of measurement used to gather information Word questions used to gather information using the respondents’ frame of

reference Why is it important to properly define the problem?

When you define a problem incorrectly, there is nothing you can do in the research process to overcome this error. This makes defining the problem and research objectives the most important step in the marketing research process.

There are 2 sources of problems: 1) Failure to meet an objective 2) Opportunity

Marketing opportunity has been defined as an area of buyer need or potential interest in which a company can perform profitably.

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Step 3: Establish Objectives

Research objectives, when achieved, provide the information necessary to solve the problem identified in step 2.

Research objectives state what the researchers must do. Research objectives state specifically what information the researcher

must produce so that the manager can choose the correct decision alternative to solve his or her problem.

Hypotheses are statements that are taken as true for the purposes of argument or investigation.

Criteria for writing research objectives: Specify from whom information is to be gathered Specify what information (construct) is needed Specify the unit of measurement used to gather the information Word questions used to gather information using the respondents’ frame of

reference

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Step 4: Determine Research Design

Research design refers to the research approach undertaken to meet the research objectives

A decision that is made in determining the research objectives is whether the research will be: Descriptive research: a set of methods and procedures describing

marketing variables; objective is to describe marketing phenomena (i.e. measuring customer satisfaction)

Diagnostic research: goes beyond descriptive research; designed to determine the sources of satisfaction and dissatisfaction (i.e. not enough inventory)

Prescriptive research: provides information that allows the manager to best remedy the dissatisfaction (i.e. which assortment of merchandise will increase satisfaction)

The three widely recognized research designs are: Exploratory research: collecting information in an unstructured and

informal manner, like asking experts (i.e. collecting background information on the Internet)

Descriptive research: research that describes market characteristics/functions, and specific hypotheses are set (i.e. describing the levels of satisfaction with a service)

Causal studies: attempt to uncover what factor or factors cause some event, such as experiments (i.e. change in package size effects on sales)

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Step 5: Identify Information types and sources

Researchers must identify the type and sources of information they will use in this step:

There are 2 types of information:Primary information: information collected specifically

for the problem at handSecondary information: information already collected

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Step 6: Determine Methods of Accessing Data

Secondary data is relatively easy to access; primary data is more complex.

The most popular form of accessing data is online surveys. Traditional modes of data collection, such as telephone, mail, and face-to-face intercepts, still have a place in marketing research.

Four main choices for collecting primary data: Personal: a person ask questions Computer-assisted Self-administered: answer questions themselves without computer

assistance Combination

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Step 7: Design Data Collection Forms

Questionnaire: must be worded objectively, clearly, and without bias in order to communicate with respondents.

Observation form: only observe respondents Software programs are available to assist marketing researchers in

preparing forms.

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Step 8: Determine Sample Plan and Size

Research studies are undertaken to learn about populations by taking a sample of that population.

Population: the entire group (census) Sample plan: describes how each sample element/unit will be drawn from

the total population. Must be representative. Sample size: how many elements of the population should be included in

the sample. Must be accurate.

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Step 9: Collect Data

Errors in collecting the data may come from fieldworkers / respondents and may be intentional / unintentional.

Errors will occur: know the possible sources & implement controls to minimize them.

Aim: minimize the possibility or errors through validation. Data collection companies: referred to as field service firms. Marketing research professional organisations conduct studies of the

industry.

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Step 10: Analyze Data

Data analysis: entering data into computer files, inspecting data for errors, and running tabulations and various statistical tests.

Objective of data analysis:use statistical tools to present data in a form that

satisfies the research objectives. I.e. purchase intentions amongst different age groups

SPSS®

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Step 11: Prepare and Present the Final Research Report Reporting, the last step, is one of the most important phases of

marketing research. Its importance cannot be overstated because it is the report, or its

presentation, that properly communicates the results to the client. The marketing research proposal serves as the basis of a

contract as it documents what the marketing researcher proposes to deliver to the client for some consideration, typically a fee.

Elements of a research proposal include the following: Statement of the problem The research objectives The research method Statement of deliverables Costs Timetable

Clients and researchers should be sensitive to ethical issues pertaining to the research proposal, such as competitive bidding

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Review questions:1. Explain why firms may not have a need for marketing research.

Marketing research is not needed when: (1) information is already available, (2) the timing is wrong, (3) funds are not available, and (4) costs outweigh the value of the marketing research.

2. What is meant by “the problem?” A problem is a situation calling for a manager to make choices among

alternatives.3. What is the research objective?

A research objective states specifically what information must be produced by the researcher so that the manager can choose the correct alternative to solve the problem.