Marketing Research the Research Process

7/30/2019 Marketing Research the Research Process

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The Research Process


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Marketing Research: Definition andPurpose

Many definitions of Marketing Research:

Marketing research is the systematic design, collection,analysis and reporting of data and findings relevant to aspecific marketing situation facing the company.[Philip Kotler

the systematic gathering, recording and analyzing of alldata about problems relating to the marketing of goodsand services. [The American Marketing Association]

Basic Purpose of Marketing Research Marketing research reduces uncertainty or error in

decision-making. The information collected byconducting marketing research is used for problemsolving and decision making in various areas ofmarketing.


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Marketing Research ...

Can help the marketing managerto:

(1) Identify and define marketing problemsand opportunities accurately;

(2) Understand markets and customers andoffer reliable prediction about them;

(3) Develop marketing strategies and actionsto provide a competitive edge; and refineand evaluate them;

(4) Facilitate efficient expenditure of funds;

(5) Monitor marketing performance; and(6)Improve the understanding of marketing

as a process.

Is important becauseof

Rapid changingmarketingenvironment;

Need for up-to-dateinformation forstrategicallyimportant areas;

Importance ofresearch as anintegral part ofbetter operation.


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THE MARKETING INFORMATION SYSTEMAND

Marketing research is not the only source ofinformation that marketing managers need in makingdecisions.

Information may also be generated by various

components of the Marketing Information System (MIS)consisting of a series of interactive components(Figure 1.1).

There are four subsystems of the MIS: internal reports,

marketing intelligence, marketing research, andmarketing decision support.


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SOURCES OF INFORMATION

Marketing

ManagersMarketing

Environ-

ments

Internal

Reporting

System

Marketing

Intelligence

System

An

Analytical

Marketing

System

Marketing

Research

System

Marketing Decisions and Communications

INFORMATION

1. Assessment ofNeeds

2. Distribution

THE MARKETING INFORMATION SYSTEM


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When Marketing Research may not benecessary

Marketing research is almost always problem-oriented. Whether to conduct marketingresearch depends on the managersexperience and wisdom; nature of decisionsituation [repetitive or atypical]; degree of

uncertainty; and the value and importance ofthe research.

Marketing research may not be necessary if: Information is available/outcomes known.

Insufficient time for marketing research.

Non-availability of resources.

Cost Vs Value of the Research. Outcomes known.


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MAIN DIVISIONS OF

1. Market and Sales Research

2. Product Research3. Price Research4. Distribution (Place) Research5. Promotion Research.


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Types of Marketing Research

Basic Research

Preliminary Conclusive Performance

Applied Research

Research Based on

Purpose

Primary Research

Secondary Research

Research Based on

Source of Data

Qualitative Research

Quantitative Research

Research Based on

Data Collection Method

Marketing Research


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Combinations of types such as applied qualitativeresearch, basic primary research are common

A sample of questions commonly answered byconducting primary applied research include: What price should we charge for our product?

What distribution channels should be used?

How well does the product match up with the competitorsproduct?

How effective is the companys advertising?

How will the consumers receive this new product?

What percentage of market penetration does Product X have?

What is Product Xs image in the consumers mind?


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Qualitative research involves collecting, analyzing, and

interpreting data by observing what people say or do.

Uses a smaller number of individuals and observes them for a

time span of between 1 and 2 hours. -----soft approach

Quantitative research is the traditional mainstream ofmarketing research.

It is also called survey research. Involves the use of questions

and large number of respondents within a brief span of time, say

15 to 45 minutes.

Its purpose is very specific-- e.g. a nationwide survey on theRoad Pricing System for cars. The hard approach to marketing

research.


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THE MARKETING RESEARCH PROCESS Every research project is different and unique.

However, research procedures and activitiesare common and constitute the marketingresearch process .

This process: is an well-organized sequence of ten steps

involved in the systematic collection andanalysis of marketing data.

provides a description of how a marketing

investigation is designed and implemented, andhelps to guide the execution of a research project.

is interactive, a researcher may not follow theten steps exactly in the order presented here.


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Ten Steps in the Marketing Research Process

1. Define the Problem

2. Establish Research Objective

3. Determine Research Design

4. Identify Information Needs and Sources5. Determine Methods of Data Collection

6. Design Instrument for Data Collection

7. Determine Sample Plan and Sample Size

8. Collect Data9. Analyze Data

10. Prepare and Present Final Report


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Step 1: Define the research problem I

The very first, and the most important step inresearch: A problem well-defined is half solved Nature of the problem determines the type of study to

conduct.

Symptoms, for example, declining sales, profit, marketshare, or customer loyalty are not problems.

A research problem must be accurately and preciselydefined, otherwise the task of designing a goodresearch difficult.

Marketing problems may be difficulty-related or

opportunity-related. For both, the prerequisite ofdefining the problem is to identify and diagnose it. Conduct situation analysis. It provides the basic motivation and

momentum for further research.


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Step 1: Define the research problem II

Get the right answer to the question:

What exactly does the firm want (or need) to know?

The basic question to address is:

How to know that there is a problem? Problems may become apparent from:

deviation from the business plan, company records andreports, customer complaints and grievances, conversationswith company employees, and observation of inappropriatebehavior or conditions in the firm;

the success of the firms competitors, and published

materials reporting issues such as, changes in market orenvironmental trends, new government regulations,anticipated changes in the economy, etc.)


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Step 1: Define the research problem III

Once the symptoms of a problem are detected..

Conduct some initial fact finding to determine the nature ofthe true problem.

Talk to others about the problem and conducting apreliminary literature search on the topic.

In the initial stage, a problem may be recognized in a verybroad and general form only. This may restrict theresearch program from being comprehensively designed.

Both the researcher and the marketing manager (or theresearch client ) need to work together to formulate the

problem into a precise and definite statement. This fact-finding exercise helps the researcher to refine

his educated guess to a more accurate problemstatement.


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Step 2: Establish Research Objectives

If you do not know what you are looking for, you wont findit

Research objectives are related to and determined bythe problem definition. In establishing researchobjectives, the researcher must answer the following

questions:i) What specific information should the project provide?ii) If more than one type of information will be developed

fromthe study, which is the most important? and finally,

iii) What are the priorities? When specifying research objectives, development of

hypotheses, might be very helpful.

When achieved, objectives provide the necessaryinformation to solve the problem.


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Step 3: Research Design

3. Research Design step involves the development of aresearch plan for carrying out the study.

There are a number of alternative researchdesigns. The choice will largely depend on theresearch purpose.

EXPLORATORY

Focus Group;

Observation;

Others.

QUALITATIVE RESEARCH

DESCRIPTIVE

Survey research

CAUSAL

Laboratory Experiment

Field Experiment

QUANTITATIVE RESEARCH

MARKETING RESEARCH


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Step 4: Specify the information required.Step 5: Design the method of collecting the needed information.

4. After defining theproblem theresearcher must

determine what kindof information will

best meet theresearch objectives.

Secondary

information Primary

information

5. Marketing researchinformation may be collectedin many ways:

via mail, telephone, fax,Internet, or personalinterview.

using consumer panels,consisting of individualswho have agreed to providepurchasing and mediaviewing behavior.


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Step 6: Design the questionnaire. A primary responsibilities of a marketing researcher

is to design the data collection instrument or

questionnaire in a manner so that it is easilyunderstood by the respondent and administered to

them.


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Step 7: Decide on the sampling design.

Step 8: Manage and implement the data collection.

The researcher must determine the criteria thatwould enable a respondent to take part in a study. The sampling design must result in the proper sample

of respondents being selected. Different sampling

designs are available to researchers. The researcher must properly manage and oversee

the data collection process. If interview method is used, the researcher must train

interviewers and develop procedures for controlling

the quality of the interviewing. [This is not necessary if survey methodology is used,

where the research instruments are completed by therespondents. ]


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Step 9:Analyze and interpret the results.Step 10: Communicate the findings and

implications.

The raw research data needs to be edited, tabulatedand analyzed to find the results and to interpret them.

the method used may be manual or computer based.

The analysis plan follows from the research objective of the

study. Association and relationships of variables are identified and

discussed in the light of the specific marketing problem.

The researcher has to submit a written report and oftenmake an oral presentation to management or the client.

In conducting all the marketing research activities; themarketing researchers must adhere to ethical standards.


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Marketing Problems Versus Research

Problems

Not all marketing problems are researchable. Toclearly define a researchable problem, the researcher must define the scope of the problem

during the initial investigation, and try to determineprobable cause-and-effect relationships between the

variables by answering the following questions:

What is (are) the symptom(s) that indicate(s) thatthere is (are) a problem (s)?

What is (are) the likely cause(s) of the problem?

What information will be needed to find a solution tothe problem?

What possible course(s) of action may be taken ifinformation is available?


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Phrasing a Researchable Problem I

A marketing problem that can be researched, must be

translated or written into a form that includes:

A relationship between two (or among several) variables.

Each variable is operationally defined, A population for the research is implied or identified.

Consider the observation, We need to find why our stores

image seem to be have gone down?

This problem is not researchable because it does not clarify

(I) the relationships that are described; (ii) how the conclusion seems to be have gone down? is reached, and

(iii) gone down compared to what?


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Phrasing a Researchable Problem II

This research problem suffers because the termsare not specifically defined. When image is referred to, what does it mean? The

number of customer that frequent the store? Thenumber of complaints lodged by customers? Thestores market share? Or what?

Similarly, what does gone down actually mean? Is itreferring to reduction in the number of peoplefrequenting the store? Or what?

Finally, what population is being implied? Does it referto all sales to all customers or particular types ofcustomers?


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Operational Definitions of a Variable

It is a definition that is determined by theoperations needed to measure the variable inquestion.

A term may not have only one, universal

meaning. In the statement, I want to buy a car, the

variable car is not operationally defined.A car may mean, among others, a sedan, a sports car,

a pick-up or a mini van; it may also refer to anAmerican, or a Japanese built car. Hence just saying

car could be misleading. One must be specific as to what it exactly

means. Operational definitions reduceambiguity.


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Variables and Constructs

Avariable is a factor that:

(i) causes some other factor(s) to vary, and

(ii) may assume different numerical values.

Price is a variablesince it can cause sales levels tovary and may assume different numerical values.

A Construct is a variables with special interpretation.Constructs are concepts that are deliberately invented oradopted for a special scientific purpose.

In statistical analysis, a variable is generally identified bya symbol, such as X or Y. If a researcher is using SPSS, or

other computer packages, he or she may use the name ofthe variable itself or its abbreviated form e.g., agemarstat (for marital status), occupn (for occupation),etc.


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Classification of Variables

1.Categorical or Classificatory Variables: have a limited number of values, e.g., gender (male or

Female) , marital status (married, single, widowed/widower) etc.

2.Continuous variables:

have an infinite number of values, e.g., temperature, sales in$ or number, profit in $.

3. Dependent Variables: Variables expected to be predicted or explained.

4. Independent Variables: Variables that are expected to influence, predict or explain

another. For example, in the following relationship:Income (I) = F (Age, Level of education),

Income is a dependent variable; Age and Level of educationare independent variables. An independent variable issomething that the researcher can control.

C id l d b


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Constructs Widely Used byMarketing Researchers

Marketing Constructs Operational definitions

Attitudes towards brands Number of people with positive, negative or neutralfeelingBrand Awareness Percent of respondents that have heard of the brandBrand familiarity Consumers that have tried or seen the brandBrand loyalty How many times the respondent bought (used) theproductComprehension of

product benefits Respondents opinion as to what the product does tothemDemographics Respondents age, sex, marital status etc.Past purchase or use Percent of respondents that bought(used) theproduct/servicePsychographics How consumers think and behave

Purchase intention Number (%) of respondents planning to buy a productReach The number (%) of households exposed to anadvertisement schedule during a given periodof time.Satisfaction How the respondents evaluate the performance of the

product or the service


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RESEARCH PROPOSAL I

A research proposal a plan showing step by step description of how a proposed

research project will be undertaken.

reflects the researchers understanding of the problem andability to conduct the research.

If the research is to be conducted through a researchagency, the research proposal acts as an importantselection criterion. Upon its acceptance, the research proposal becomes the basis

for the contract or agreement between the research agency andthe client, and serves as a record of what was agreed on.


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RESEARCH PROPOSAL II There is no fixed or standard format for a research

proposal as it is dependent on the nature of the

specific research project. However, most research

proposals contain the following items. 1. Introduction

2. Statement of the Marketing Problem

3. Specification of the Research Objectives

4. Details of the Proposed Research Plan 5. Time schedule

7. Research team


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Marketing Research the Research Process