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1 Introduction
The marketing concept states that the nature of the marketing orientated organisation, whether product or
service based, profit or non profit based, is the identification and genuine satisfaction of customers needs and
wants, more effectively and efficiently than the competition. The marketing concept has been defined as ‘the
key to achieving organisational goals’ and the marketing concept rests on ‘market focus, customer orientation,
co-ordinated marketing and profitability’. In a profit making business the firm obviously has to try and achieve
this level of customer satisfaction as a way of staying ahead of the competition and making a profit. In a ‘not
for profit’ organisation, management substitutes profit for some other criterion such as maximum social
benefits; a political party would be likely to substitute maximising votes for financial profit. A university on
the other hand may substitute ‘research excellence’, to purely financial profit. In order for organisations to be
able to arrange their assets and resources in such a way that they are able to produce ‘bundles of satisfactions’
that satisfy the genuine desires of specifically defined target markets better than the competition, they need to
know what the market regards as valuable. The concept of value is subjective and lies in the mind of the
individual prospective customer. Hence, in a broad sense, marketing management needs to understand the
‘minds’ of their target markets, their attitudes and value systems. They need a formalised, managerial
approach to this most important task. This is the fundamental role of marketing research.
Without the information that marketing research provides, management cannot apply the marketing concept as
an overriding business philosophy. It is not the intention to present a comprehensive treatment of marketing
research, and indeed it would take an entire textbook to do this. The purpose of this material is simply to give
you a ‘feel’ for the subject and relate how it fits into modern marketing practice.
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4 Types of Marketing Research
Marketing research activities can be classified by their purpose or general objective. Some marketing research
exercises are intended to produce results that are purely exploratory in nature. Such research is usually carried
out at the beginning of the overall research project. Other research may produce data that are descriptive,
predictive or conclusive in nature. These general classifications are now examined in more detail.
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manager wanted to establish which set of merchandising materials, which price promotion and which shelf
configuration would be most effective in achieving sales within a multiple grocery store chain. Let us also
assume that there are four different versions of each of the marketing variables e.g. four merchandising ‘sets’,
four price promotions that could be used in store and four different shelf configurations. The researcher wants
to know which permutation of these three marketing variables is most effective. The researcher sets up an
experiment where each permutation of experimental treatments is randomly allocated to retail stores.
Differences between stores will be accounted for in the experiment. The experiment will be allowed to run
until sufficient data has been generated. The results are then analysed and used to see if the hypothesis that one
set of experimental treatments has been more effective in generating sales than the others were in fact true or
false. Statistically designed experimental methods such as Analysis of Variance (ANOVA) would be used in
such a situation.
All experimental exercises that enable the researcher to establish causation in tests have a number of factors in
common. The researcher starts with the marketing variables that are to be tested, these are known as the
‘independent variables’. These variables are then applied to a given situation and certain effects are monitored.
These effects are usually sales, but might be something else such as behavioural changes of some kind e.g.
store loyalty. These effects are regarded as ‘dependent variables’ because they are dependent on the marketing
variables discussed earlier. Experiments are set up with the purpose of trying to establish scientifically, using
statistical tests, whether the effects seen in the dependent variables are in fact attributable to changes in the
independent variables (i.e. the marketing variables) and if so what are the nature and strength of these effects.
The marketing researcher wants to know whether the experimental effects caused by the independent variables
acting upon the dependent variables are in any way commercially exploitable.
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4 Determine details of the research design - methods, sample design
5 Data collection
6 Analysis and interpretation of data
7 Evaluation of results and recommendations
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2. Pilot testing should involve well-trained experienced staff because it is important to get the questionnaire
right as the success of the entire survey depends on it. It is possible that a number of versions of the
questionnaire will need to be tested before it is right. The last pre-test should use the final approved
questionnaire.
7 Questionnaire design
The information collected must be accurate, so the design of a questionnaire is of great importance. It should
consist of questions that have the same meaning, a single meaning and the intended meaning to everyone.
Questions should be numbered and have instructions to the investigator concerning the conduct of the
interview in bold face, capital letters and underlined. Answer codes should be as near to the right-hand side as
possible, and lines drawn at suitable intervals can bring clarity to the design.
The types of questions most commonly used are as follows.
1. Open-ended questions give the informant a hint of what answer might be expected. A question which
begins ‘What do you think of...?’ will bring forth large amounts of data which cannot always be
satisfactorily summarised, but this type of question is useful in the pilot stage to show the range of likely
answers.
2. Unaided recall questions do not mention the nature of the answer material and avoid asking leading
questions; e.g. ‘How did you travel to the station to catch this train?’
3. Dichotomous questions offer two choices of answer, usually ‘yes’ and ‘no’.
4. Multiple-choice questions (‘cafeteria’ questions) offer a graduated range of possible answers, listed in
order from one extreme to the other.
5. Thermometer questions ask informants to rate their feelings on a numerical scale, e.g. 0-10. This type of
question seeks to minimise the disadvantage of discrete classification in the multi-choice type question.
6. Checklists are a standard way of prompting the memory of a respondent without being biased by the
interviewer. However, brand leaders may be selected more frequently because of the weight of advertising.
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14. Avoid questions or words with an emotional bias.
The first questions asked should gain the interest of the informant, and should be easy to answer in a factual
way. More difficult questions should come later, with those of greatest importance being about a third of the
way through. Transition from question to question should be smooth and logical. Details of the respondent, if
they are needed (age, address, name, occupation etc.) should appear at the end. The questionnaire must have a
title and contain cross-references to others if needed, along with the interviewing district identification, the
place and date of the interview and the interviewer’s name.
Answers should be recorded in one of the following ways:
• Writing a number.
• Putting a cross or a tick in a box.
• Underlining correct answers.
• Crossing out incorrect answers.
• Writing in a predetermined symbol.
• Ringing a number or letter.
Open-ended questions should be followed by enough space to allow for answers to be recorded word for word.
There are a number of basic questions that should be asked about any questionnaire:
1. Is each question clearly worded?
2. Does it break any of the basic rules of question design?
3. Is each question concerned with one factor only?
4. Are the questions ones that will elicit the answers necessary to solve the research problem?
5. Is each question unambiguous - will both the investigator and the informant have the same understanding
of the question?
6. Are all the possible answers allowed for?
7. Are the recording arrangements foolproof?
8. Will the answers to each question be in a form in which they can be cross-tabulated against other data on
the same or other questionnaires?
9. Will the answers be in a form that will allow at least some to be checked against established data?
8 Marketing experiments
An experiment is a way of gathering primary data in which the researcher is able to establish cause and effect
amongst the variables being experimentally tested. It can be carried out in an artificial ‘laboratory’ type
setting or as a field experiment, the best example of which is the test market where researchers choose a
representative geographical area or one where they can statistically adjust data to make them representative of
a wider market area. The test market is like a ‘model’ of the total market. Test markets can be expensive, but
being a field experiment they have the advantage of realism or ‘external validity’ over laboratory experiments.
Another experimental technique involves surveying a small sample of consumers and showing them pictures
or samples of products and ascertaining their preference as if they were really ‘shopping’.
Other techniques include extended user tests, ‘blind’ and simple placement tests. In addition, there are certain
techniques used in the pre- and post-testing of advertising themes and copy. Marketing experiments are one
of the four main classes of research methods whereby marketing researchers collect primary information i.e.
information collected for the first time specifically for a particular research exercise. The other three classes of
techniques are Interviews, such as depth interviews and group discussions, Observation such as retail audits
and consumer panels and Surveys such as a postal questionnaire of telephone surveys.
9 Observational Techniques
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Sometimes it only possible to collect the kind of data required by observation. It may be humans observing
humans, humans observing objects (e.g. cars), electro-mechanical devices such as cameras or tape recorders
etc. observing objects or people. Retail audits and consumer panels are also classified as observational
techniques. Retail audits conduct product audits in a large number of retail stores every month. Company
product managers can buy the retail sales data and other supporting information on a ‘continuous’ month by
month basis. Other related information on competitors’ products is also available.
The consumer panel is a home audit where a wide range of households are monitored as to their purchasing
habits. Respondents are of different socio-economic groups, family size and stage in the family life cycle.
They record their purchases using a special bar code reader and send the data to the research company’s
headquarters using a coupler. In the retail audit most stores use electronic point of sale (EPOS) and again can
send retail sales information down the telephone line to the auditing company. Smaller shops that do not have
the technology still have to be audited ‘manually’. Observational techniques are a useful source of primary
data and this method is often used in conjunction with other research methods.
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scale sample surveys using questionnaires, can be used in the appraisal of existing channel efficiency and in
predicting likely future developments.
New developments in the area of physical distribution can also be monitored and to some extent predicted
using marketing research techniques. For example the concept of ‘just in time’ delivery systems which is used
by a large number of organisations originated in Japan, so this is a techniques that could have been predicted
long before it became established outside of Japan. Materials handling and vehicle technology is continuously
developing with implications for the logistics industry especially transport. Computer technology has now
made available ‘tracking systems’ so that customers can establish exactly where their order or delivery is in
the order processing cycle and even establish exactly where a particular consignment is anywhere in the world.
12 Summary
Marketing is the business process whereby organisations strive to create ‘bundles of values or satisfactions’ in
the form of products and services that their customers will willingly buy. In the value creation process
marketing firms attempt to at least meet, but preferably exceed, customers’ expectations. To remain
competitive marketing firms have to create customer value more effectively and efficiently than the
competition.
Firms that are market driven and customer focused in this way are said to be ‘marketing oriented’ firms.
However ‘value’ is somewhat subjective and lies in the minds of individuals and groups of people. Value
changes all the time within people’s minds. For example what is regarded as fashionable in terms of clothing
or popular music might not be next year. What might be regarded as unimportant say ten years ago may
become more important a decade later. For example, ‘green’ and environmental issues were not something
that concerned the majority of people a decade ago, whereas in the late 1990’s most people express some
concern about such issues. This concern is reflected in a wide range of products that claim to be
‘environmentally friendly’, ‘ethical’ or ‘healthy’.
In order to keep up with the changing tastes and changing value systems of customers, the activities of the
competition and important changes in the external business environment, the marketing orientated firm needs
information. Long term corporate and marketing strategy and marketing plans at the more tactical and
operational levels need information. Such information is the life-blood of the marketing orientated firm.
Without the right kind of information, effective marketing is impossible. Marketing research provides the
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organisation with a wide range of useful information, but marketing research on its own is insufficient at a
strategic level; it must form an intrinsic part of the wider marketing information system.