Prof. Richardson MKTG 116 Slide 1

Chapter 5
Prof. Richardson MKTG 116 slide 1

Chapter 5
Introduction
Business which have “extra information” are

more competitive.
The process of developing information
through Market Research is becoming more
complicated and is greatly enhanced and
improved by using advanced
telecommunications (e-mail, fax, internet etc.)
Chapter 5
“The quality of marketing planning decision

depends on the quality of the information on which
they are based” p. 76
Garbage In = Garbage Out

good market info = good marketing planning

Chapter 5
good market info = good marketing planning
There are many sources of Market Info

•customer complaints
•sales-force reports
•government statistics
•industry reports … and ... Page 76

Chapter 5
Marketing Research
The systematic gathering, recording,

and analyzing of data about problems
relating to the marketing of goods and
services.
Page 76

Chapter 5
Marketing Research
The critical task of the Marketing

Manager is DECISION MAKING. P. 77
Marketing Research helps provide

good information to help in decision
making.

Chapter 5
Marketing Research
The information gathered during

Marketing Research can help:
• develop sales forecasts
• design new products, based on customer opinion
• create attractive packaging
• guide advertising plans
Page 77
Chapter 5
Marketing Research
Where do you get the info?
A. you can do it yourself by making

someone in the company responsible
for doing the research
B. you can hire an outside agency that
specializes in Market Research
Page 78
Chapter 5
Marketing Research
Where do you get the info?
B. you can hire an outside agency that specializes
in Market Research
There are 2 types of outside agencies

1. Full Service Research Supplier
2. Syndicated Service
Page 78
Chapter 5
Marketing Research
1. Full Service Research Supplier
They will will handle all aspects, conduct

interviews, send out questionnaires, do telephone
polls etc. and provide a detailed report explaining
all aspects of your potential customer base.
Page 78
Chapter 5
Marketing Research
2. Syndicated Service
These types of companies gather various types of
information and sell it (usually in subscription
form) to clients that have regular needs.
• Restaurants can buy statistical information on
eating habits and spending patterns
• Clothing companies can buy information on
demographics and seasonal buying patterns as
well as trend information.
Page 78
Chapter 5
6 Steps in the 1.
Market Research
Process 2.
3.
s
oces
4.
h Pr
earc
5.
Res
eting
Mark
The
6.
1
re 5.
Page 79
Figu

Chapter 5
Problem Definition
You have to first know what you are looking

for - this is not always so easy.
If your new chocolate bar isn’t selling well,
you don’t automatically do market research
on the “taste” - because maybe the reason
has to do with the packaging.
Page 78
Chapter 5
Often described
as looking before
you start looking
Exploratory Research
“Learning about the problem area and

beginning to focus on specific areas of
study by discussing the problem with
informed sources within the firm
(a process often called situation analysis)
and with knowledgeable others outside
the firm (the informal investigation).”
Page 79
Chapter 5
Exploratory Research
One of the important things to do is review the

existing situation to determine how things came to
be that way - this is an important part of the
Exploratory Research and is one of the reasons
why companies hire outside agencies.
It is difficult for a company to “look at itself”
Page 80
Chapter 5
After the problem has been defined

(Step 1), and an exploratory
investigation (Step 2) has been
conducted,
it is possible to then formulate a
Hypothesis (Step 3)

Chapter 5
Stage 3
Hypothesis
“A tentative explanation about the
relationship between variables as a
starting point for further testing.” Page 81
TEXT
The way of thinking about how something works -

and using your original “guess” as a starting point
for further investigation
WTGR

Chapter 5 Hypothesis
http://www.reinartz.com/mark4338/CLASS_4/sld006.htm
Chapter 5
Research Design Stage 4
The Research Design should be a plan for

testing the Hypothesis.
A series of advance decisions that, taken

together, make up a master plan or model for
conducting the investigation.
page 81

Chapter 5
Research Design
http://www.reinartz.com/mark4338/CLASS_4/sld007.htm
Chapter 5
Collecting Data Stage 5
• Collecting Data is often the expensive

stage because it may involve paying
people to make telephone calls, or
hiring students to takes questionnaires
to malls and ask shoppers to answer
questions.
• This is time consuming as well as costly

Chapter 5
Primary Data
Data being collected for the first time.
Secondary Data
Previously produced or published matter.
Page 81

Chapter 5

Secondary Data
Internal
- eg. company sales records
External
Previously published matter.
(gov’t statistics, reports, newspaper articles etc.)
Page 83

Chapter 5

Secondary Data
External
- Government Sources
http://WWW.StatCan.CA/english/Pgdb/Economy/econom.htm
http://WWW.StatCan.CA/english/Pgdb/People/Population/demo05.htm
The Canadian government produces so MUCH data

from census and business reports that it is published
in report. Some of these reports are free, some can be
bought, and some customized information can be
bought at a high price.
Page 83

Chapter 5
Collecting Data
Advantages of Secondary Data Page 84
1. less expensive
2. less time

Chapter 5
Collecting Data
Advantages of Secondary Data Page 84
1. It is usually less expensive than Primary Data - and

if the purpose if just to determine a general trend, then
for many situations, Secondary Data is O.K.
2. It takes less time to find Secondary Data (compared
to doing new studies) and therefore you answer your
questions more quickly, and get on with the business.

Chapter 5
Collecting Data
Limitations of Secondary Data Page 85
1. Obsolete
2. Fit - relevance

Chapter 5
Collecting Data
Limitations of Secondary Data Page 85
1. Obsolete - date it was produced may be old - this

is why some companies pay for new Primary Data
2. Fit - relevance. Some Secondary Data is too vague
to answer the questions
- therefore you need new Primary Data that is more

specific

Chapter 5
Primary Data
1. Observation
2. Survey
• Telephone
• Mail
• Personal Interview
3. Controlled Experiment
Page 85

Chapter 5
Primary Data
1. Observation
• overt - watching how customers shop, what they
look at, the features they like, asking for postal codes,
counting cars
- often used to evaluate how good some advertising is
• covert (technical eg. Hidden camera, POP
computerized information)
Page 85 ~ 86

Chapter 5
Primary Data
2. Survey
• Telephone - inexpensive and fast
- they are the majority of primary marketing
research used by big marketing research
companies
• Mail - costs less, and more detailed questions
can be asked, can be used in geographic
segments
• Personal Interview - the best method, but most
expensive
Page 86

Chapter 5
Primary Data
2. Survey
• Personal Interview
- FOCUS GROUPS are a special type of personal
interview
• typically 8 ~ 12 people are shown something,
then asked for comments
• typically used in preparing TV commercials
Page 88

Chapter 5
Primary Data
- not used very often due to costs, but sometimes
done by people who need to answer difficult
questions
- the most common method is test marketing a target
market segment, then look at the results and see what
works, and what didn’t work
Page 88

Chapter 5
Primary Data
- Sometimes TEST products are used in cities like
Calgary and Winnipeg, and then not followed up, so
people there have a chance to use totally new
products not available elsewhere
- eg. Winnipeg was the first city to try variable sizes of
plastic soft drink bottled
Page 88 ~ 89

Chapter 5
Collecting Data
Test Marketing
The selection of areas considered reasonably

typical of the total market, and introducing a
new product to these areas with a total
marketing campaign to determine consumer
response before marketing the product
nationally.
Page 88 ~ 89

Chapter 5
Collecting Data
The Data Collection Instrument
or, … “getting the info”
“Most of the work in Data Collection depends
on the use of a good questionnaire”
• has to ask questions referring to specific
objectives
• should be pre-tested, if it is new, so you can
make any changes to the questions
Page 89
Chapter 5
Sampling Techniques
• Population (universe) • Census

• Probability Sample • Nonprobability Sample
• Convenience • Judgment
• Quota • Cluster
• Simple Random • Systematic Technique
Page 90

Chapter 5
Sampling Techniques
Population (universe)
• the total group that the researcher wants to study
Page 90

Chapter 5
Sampling Techniques
Census
• if the total group is contacted, the results are
known as a census (same term as used when the
government does a census to get information on
the citizens)
Page 90

Chapter 5
Sampling Techniques
Probability Sample
• a sample in which every member of the
population has a known chance of being selected
Page 90

Chapter 5
Sampling Techniques
Nonprobability Sample
• a sample chosen in an arbitrary way so that each
member of the population does not have a
representative chance to be selected.
Page 90

Chapter 5
Sampling Techniques
Convenience Sample
• a sample chosen in an arbitrary way (a
nonprobability sample) so that each member of the
population does not have a representative chance
to be selected. - BECAUSE they just used readily
available respondents/participants
•eg. “CityTV on the street interviews”
Page 90

Chapter 5
Sampling Techniques
Judgement Sample
• a nonprobability sample of people with a specific
attribute.
•eg. “CityTV on the street interviews” of people that
DO NOT have political party affiliation - to
determine how they voted, and who would win the
election
Page 90

Chapter 5
Sampling Techniques
Quota Sample
• a nonprobability sample that is divided so that
different segments or groups are represented in the
total sample.
Page 90

Chapter 5
Sampling Techniques
Cluster Sample
• a probability sample that is used in groups
• used when it is difficult to ask everybody, so they
pick some areas and ask everybody in that area
(cluster)
Page 90

Chapter 5
Sampling Techniques
Simple Random Sample

• a probability sample in which everybody has an
equal opportunity of being selected.
Page 90

Chapter 5
Sampling Techniques
Systematic Sample
• every 5th, or every “n”th person is selected. An
example is market research people who call every
10th person in the phone book to get an opinion.
Page 90

Chapter 5
Marketing Information Systems
For some companies, market knowledge comes in on a

regular basis.
Some stuff is “Data”, and some is “Information”
Data = statistics, opinions in surveys, facts,

predictions etc.
Information = data RELEVANT to the Marketing

Manager in making decisions
Page 91

Chapter 5
The most important thing is
RELEVANCE
Page 91

Chapter 5
The best way to get RELEVANT information is to

establish a systematic approach and have a
planned Marketing Information System
Page 91

Chapter 5
Defn
A set of routine procedures to continuously
collect, monitor, and present internal and
external information on company performance
and opportunities in the marketplace.
Page 91

Chapter 5
A set of routine procedures - things you do all the
time
to continuously collect, monitor, - always
gathering info
and present - give to the boss
internal and external information - inside the
company, and from primary and secondary sources
on company performance - how you are doing
and opportunities in the marketplace.
Page 91
Chapter 5 Figure 5.2 Information Components of a Firm’s MIS
Page 92

Chapter 5
All of this depends on the ability of the

company to use technology to help it be
better than the competition

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Chapter 5

Prof. Richardson MKTG 116 slide 1

Business which have “extra information” are

“The quality of marketing planning decision

Garbage In = Garbage Out

Prof. Richardson MKTG 116 slide 3

good market info = good marketing planning

There are many sources of Market Info

Prof. Richardson MKTG 116 slide 4

The systematic gathering, recording,

Prof. Richardson MKTG 116 slide 5

The critical task of the Marketing

Marketing Research helps provide

Prof. Richardson MKTG 116 slide 6

The information gathered during

Where do you get the info?

A. you can do it yourself by making

There are 2 types of outside agencies

They will will handle all aspects, conduct

Prof. Richardson MKTG 116 slide 12

You have to first know what you are looking

“Learning about the problem area and

One of the important things to do is review the

It is difficult for a company to “look at itself”

After the problem has been defined

Prof. Richardson MKTG 116 slide 16

The way of thinking about how something works -

Prof. Richardson MKTG 116 slide 17

The Research Design should be a plan for

A series of advance decisions that, taken

Prof. Richardson MKTG 116 slide 19

Collecting Data Stage 5

• Collecting Data is often the expensive

Prof. Richardson MKTG 116 slide 21

Collecting Data Stage 5

Previously produced or published matter.

Prof. Richardson MKTG 116 slide 22

Collecting Data Stage 5

Prof. Richardson MKTG 116 slide 23

Collecting Data Stage 5

The Canadian government produces so MUCH data

Prof. Richardson MKTG 116 slide 24

Prof. Richardson MKTG 116 slide 25

1. It is usually less expensive than Primary Data - and

Prof. Richardson MKTG 116 slide 26

Prof. Richardson MKTG 116 slide 27

1. Obsolete - date it was produced may be old - this

- therefore you need new Primary Data that is more

Prof. Richardson MKTG 116 slide 28

Collecting Data Stage 5

Prof. Richardson MKTG 116 slide 29

Collecting Data Stage 5

Prof. Richardson MKTG 116 slide 30

Prof. Richardson MKTG 116 slide 31

Prof. Richardson MKTG 116 slide 32

Collecting Data Stage 5

Prof. Richardson MKTG 116 slide 33

Collecting Data Stage 5

Prof. Richardson MKTG 116 slide 34

The selection of areas considered reasonably

Prof. Richardson MKTG 116 slide 35

• Population (universe) • Census

Prof. Richardson MKTG 116 slide 37