Todays Lecture

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Lect. 5

Lect. 5

Lect. 5

Lect.5-8

Lect. 3 & 4
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Lect. 6

Lect. 3&4
Lect. 5

Lect. 7

Lect.5-8

Lect. 8

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4. Gaining Consumer Insights

Veronica Mak

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Objectives
I.

II.
III.
IV.

social networks

What is the importance of information in gaining

insights about the marketplace and customers? What
are the special issues some marketing researchers
face, including public policy and ethics issues?
Define the marketing information system and
discuss its parts.
What are the steps in the marketing research
process?
How companies analyze and use marketing
information?

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I. Why are Marketing Information and

Customer Insights Important?

Marketers must use

the information to
gain powerful
customer and
market insights.
Companies use
such customer
insights to develop
competitive
advantage.

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I. Why are Marketing Information and Customer

Insights Important?
Customer insights
Fresh

understandings of customers and the marketplace derived from

marketing information that become the basis for creating customer value
and relationships.
Marketing
People

Information system (MIS)

and procedures for assessing information needs, developing the

needed information, and helping decision makers to use the information to

generate and validate actionable customer and market insights.

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II. What is Marketing Information System?

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II. What is Marketing Information System?

Assessing Marketing Information

Needs
A good marketing information system
balances the information users would like
to have against what they really need and
what is feasible to offer.
By itself, information has no worth; its
value comes from its use.

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II. What is Marketing Information System?

- Developing Marketing Information Needs

Marketers can obtain the needed information from internal

data, marketing intelligence, and marketing research.
Internal Data

electronic collections of consumer and market information obtained

from data sources within the company network.
Sources:

Marketing Department [information on customer transactions,

demographics, psychographics, and buying behavior];
Customer service department [customer satisfaction or service
problems];
Accounting department [financial data];
Operations reports [production schedules, shipments, and inventories];
Sales force [information on resellers and competitors, and channel
partners provide point-of-sale data]

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A. Internal Data

Can be accessed
more quickly and
cheaply than other
information sources
Ages rapidly and may
be incomplete
Maintenance and
storage of data is
expensive
,

Financial services provider USAA

uses its extensive database to
tailor its services to the specific
needs of individual customers,
creating incredible loyalty
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B. Competitive Marketing
Intelligence

Techniques include:

Observing consumers
Quizzing the companys own employees
Benchmarking competitors products
Monitoring Internet buzz
Actively monitoring competitors activities

Companies also take steps to protect their

own information
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B. Competitive Marketing
Intelligence
Sources

annual reports, business publications, trade show

exhibits, press releases, advertisements, and Web
pages.

Nielsen Online, Radian6 [client: Dell], Protrac

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C. Market Research
- The 4 Steps

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III. What are the Steps in Marketing Research?

- The 4 Steps
(1)

defining the problem and research objectives

(2)

developing the research plan

(3)

the research plan can call for gathering secondary data,

primary data, or both.

implementing the research plan

(4)

The hardest
three types of objectives: exploratory research, descriptive
research, or causal research

Collecting, processing, and analyzing the information. Data

collection can be carried out by the companys marketing
research staff or by outside firms.

interpreting and reporting the findings.

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III. The 4 Steps in Marketing Research Process

1) Defining the problem and research

objectives

to gather preliminary information that

will help define the problem and
suggest hypotheses, e.g. new
products concept or creative test

to describe things, such as the market

potential for or customers attitudes
of a product.

to test hypotheses about

causeandeffect relationships

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The Research Plan

Should be presented as a written proposal

Should cover:

The management problems addressed

Research objectives
Information to be obtained
How results will help decision-making
Estimated research costs
Type of data required (Primary or secondary)
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Secondary Data

Common sources of secondary data:

Internal company databases

Commercial online databases
Internet search engines

Cheaper to obtain than primary data

Can be collected faster than primary data

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Primary Data

Designing a primary data collection plan

involves making decisions about:

The research approach

Contact methods

Mail, telephone, personal, or online

The sampling plan

Observation, survey, or experiment

Sampling unit, sample size, and sampling procedure

Research instruments
,

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Observational Research

Can obtain information that people are

unwilling or unable to provide
Cannot be used to observe feelings,
attitudes, and motives, and long-term or
infrequent behaviors

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Ethnographic Research

Kraft Canada sent out high-level executives to observe

actual family life in diverse Canadian homes. Videos of
their experiences helped marketers and others across
the company to understand the role Krafts brands
play in peoples lives

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Marketing at Work

By entering the
customers world,
ethnographers can
scrutinize how
customers think
and feel as it
relates to their
products

To better understand the

challenges faced by elderly
shoppers, this Kimberly-Clark
executive tries to shop while
wearing vision-impairment
glasses and bulky gloves that
simulate arthritis
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Contact Methods Mail

Questionnaires

Pros

Large amounts of information at a relatively low

cost per respondent
Enables more honest responses than interviews
Absence of interviewer bias

Cons

Inflexible, low response rate

Researcher has little control over sample
,

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Contact Methods - Telephone

Interviewing

Pros

Gathers information fast, high response rate

Allows greater flexibility than mail surveys
Strong sample control

Cons

Higher costs than mail questionnaires

Interviewer may bias results
Limited quantity of data can be collected
,

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Contact Methods Personal

Interviewing

Pros

Highly flexible method that can gather a great

deal of data from a respondent
Good control of sample, speed of data
collection, and response rate

Cons

High cost per respondent

Subject to interviewer bias
,

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Focus Groups

Involve inviting six

to ten people to
gather for a few
hours with a trained
interviewer to talk
about a product,
service, or
organization

Lexus general manager

Mark Templin hosts An
Evening with Lexus dinners
with luxury car buyers to
figure out why they did or
didnt become Lexus owners
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Contact Methods Online Marketing

Research

Pros

Speed and low costs

Lowest cost per respondent of all contact
methods; offers excellent sample control
Good flexibility and response rate due to
interactivity

Cons

Difficulty in controlling sample

,

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Contact Methods Online Marketing

Research

The Internet is well

suited to quantitative
research
Its low cost puts
online research well
within the reach of
almost any business,
large or small
,

Thanks to survey services such

as Zoomerang, almost any
business, large or small, can
create, publish, and distribute
its own custom surveys in
minutes
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Online Focus Groups

Gathering a small group

of people online with a
trained moderator to chat
about a product, service,
or organization and gain
qualitative insights about
consumer attitudes and
behavior

Channel M2 puts the

human touch back into
online research by
assembling focus group
participants in peoplefriendly virtual interview
rooms

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Marketing at Work

Marketers watch
what consumers
say and do online,
then use the
resulting insights to
personalize online
shopping
experiences
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Case Study: Del Monte Research Objectives

Del Monte is about to launch this pasta sauce soon in the market. This research therefore acts as a disaster check before the actual launch.

Primary Objective:
To gauge

consumers responses to the new Tetra Recart

package concept versus other packaging.
To gauge the response to Del Montes new product
offering, including their comments on color, flavor, smell,
chunkiness and potential usage of its tomato based
pasta sauces.

Key strategic outputs from this piece of research will include:

To fine tune the direction and angle for marketing communications upon product launch.

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Sampling Plan

Sampling requires three decisions:

Who is to be studied (sampling unit)

How many people should be included
(sample size)
How should the people in the sample be
chosen (sampling procedure)

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Research Instruments

Questionnaires

Closed-end questions include all the possible

answers, and subjects make choices among them
Open-end questions allow respondents to answer
in their own words

Mechanical devices

People meters, checkout scanners,

neuromarketing

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Mechanical instruments

To find out what ads

work and why, Disney
researchers use an
array of devices to
track eye movement,
monitor heart rates,
and measure other
physical responses

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Implementing the Research

Plan

Collecting the data

Processing the data

Most expensive phase

Subject to error
Check for accuracy
Code for analysis

Analyzing the data

Tabulate results
Compute statistical
measures
,

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Interpreting and Reporting

Findings

Interpret the findings

Draw conclusions
Report to management

Present findings and conclusions that will be

most helpful to decision making

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Customer Relationship
Management (CRM)

Managing detailed information about

individual customers and carefully managing
customer touch points to maximize customer
loyalty

Helps firms offer better customer service

Helps identify high-value customers
Enhances the firms ability to cross-sell products
and develop offers tailored to customers
,

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Distributing and Using

Marketing Information

Marketing information systems (MIS)

must make information readily available
for decision-making:

Routine information for decision making

Nonroutine information for special situations

Intranets and extranets facilitate the

information sharing process
,

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Other marketing considerations

Non-profit Organization
International Marketing Research

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Understanding Consumer Behavior

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Objectives
I.

II.
III.

Understand the consumer market and

the major factors that influence
consumer buyer behavior
Identify and discuss the stages in the
buyer decision process
Describe the adoption and diffusion
process for new products
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I. Factors influencing Consumer Behavior

Model of Buyer Behavior

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I. Factors influencing Consumer Behavior

Model of Consumer Behavior

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I. Factors influencing Consumer Behavior

Cultural Factors
Culture is the set of basic values, perceptions, wants
and behaviors
learned
by a member
of society
from family
and other
important
institutions
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I. Factors influencing Consumer Behavior

Cultural Factors
Subculture is a group of people with shared value
systems based on common life experience and
situations.

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I. Factors influencing Consumer Behavior

Cultural Factors

Social Classes are societys relatively

permanent and ordered divisions whose
members share similar values, interests,
and behaviors.
Social class is not determined by a single
factor, but is measured as a combination
of occupation, income, education, wealth,
and other variables. HSBC
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I. Factors influencing Consumer Behavior

Social Classes

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I. Factors influencing Consumer Behavior

Social Factors

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I. Factors influencing Consumer Behavior

Social Factors
Groups and Social Networks.
A persons behavior is influenced by many small groups.
Group and Opinion Leader
Opinion leaders are people within a reference group who,
because of special skills, knowledge, personality, or other
characteristics, exert social influence on others.
These 10 percent of Americans are called the influentials or
leading adopters.
Online social network are online spaces where people
socialize or exchange information and opinions.
Marketers use buzz marketing to spread the word about their
brands
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Marketing at Work

Mountain Dew runs

DEWmocracy
campaigns that invite
avid Mountain Dew
customers to
participate at all levels
in launching a new
Mountain Dew flavor
Mountain Dews DEWmocracy
campaign
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Groups and Social Networks

Online social
networks allow
marketers to
interact with
consumers
Blendtec has developed a
kind of cult following for its
flood of Will It Blend?
videos on YouTube,
resulting in a fivefold
increase in Blendtecs
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sales
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I. Factors influencing Consumer Behavior

Social Factors
Family Ikea
The most important consumer buying organization
in society.
70% women hold jobs outside the home.
65% men grocery shop regularly
36 million kids age 8 to 12 control an estimated $30
billion in disposable income
Roles and Status.
A role consists of the activities people are expected
to perform. Each role carries a status reflecting the
general esteem given to it by society.
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I. Factors influencing Consumer Behavior

Personal Factors
CSL and
One2Free

LV

Nike vs
Addidas
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I. Factors influencing Consumer Behavior

Psychological Factors

A motive (or
drive) is a need
that is sufficiently
pressing to direct
the person to
seek satisfaction
of the need

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I. Factors influencing Consumer Behavior

Psychological Factors

Perception is a process by which people

select, organize,
and interpret
information to
form a
meaningful
picture
of the world.
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I. Factors influencing Consumer Behavior

Psychological Factors

Learning
describes changes
in an individuals
behavior arising
from experience

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I. Factors influencing Consumer Behavior

Psychological Factors
Learning
A drive is a strong internal stimulus that calls for action.
A drive becomes a motive when it is directed toward a
particular stimulus object.
Cues are minor stimuli that determine when, where, and
how the person responds.
Beliefs and Attitudes.
A belief is a descriptive thought that a person has about
something.
Attitude describes a persons relatively consistent
evaluations, feelings, and tendencies toward an object
or idea.
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The Buyer Decision Process

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Need Recognition and

Information Search

Need recognition
can be
triggered by
internal or external
stimuli

Advertising can
be very helpful in
stimulating need
recognition
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Postpurchase Behavior
Cognitive dissonance
Discomfort caused by post-purchase
conflict, occurs in most major purchases.

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III. Adoption and Diffusion Process for

New Products
[

A new product is a good, service, or idea that is

perceived by some potential customers as
new.
The adoption process is the mental process
through which an individual passes from first
learning about an innovation to final adoption.
Adoption is the decision by an individual to
become a regular user of the product.
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III. Adoption and Diffusion Process for

New Products
[

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III. Adoption and Diffusion Process for

New Products

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Product Characteristics That

Influence the Rate of Adoption

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Readings

Skip Business Buying Decision.

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