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Churchill Brown Suter

Basic Marketing Research

Problem Formation
Chapter 4
 Learning Objectives

 Specify the key steps in problem formulation

 Discuss two objectives of the initial meeting with the

research client

 Discuss the two general sources of marketing

problems/opportunities

 Explain why the researcher must be actively involved in

problem formulation

 Distinguish between two types of decision problems

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 Learning Objectives

 Distinguish between a decision problem and a research

problem

 Describe the research request agreement

 Outline the various elements of the research proposal

 Describe types of research that should be avoided

 Describe the purpose of a request-for-proposal (RFP)

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 Stages in the Research Process

Formulate Problem
Determine Research Design
Determine Data Collection Method

Design Data Collection Forms

Design Sample and Collect Data

Analyze and Interpret Data

Prepare Written/Verbal Report

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 Key Steps in Problem Formation

Step 1 Meet with Client

Step 2 Clarify Problem or Opportunity
Step 3 State Manager’s Decision Problem
Step 4 Develop Possible Research Problems
Step 5 Select Research Problem(s) to be Addressed
Step 6 Prepare Research Request Agreement

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 Meet with Client

 Two objectives of the initial meeting

 Establish rapport including trust building and open
communication
 Learn as much as possible about the problem/opportunity
 Ask questions like, “What caused you to notice the problem?”
 “What factors do you think have created this situation?”
 “What is likely to happen if nothing changes in the next 12
months?”
 “What do you hope to accomplish using marketing research?”
 “What actions will you take depending upon the answers?”

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 Meet with Client

 Unplanned Change as a  Planned Change as a

Source of Source of
Problems/Opportunities Problems/Opportunities
 New technology  New product introduction
 New good or service from  Improved supply chain or
a competitor distribution channel
 Socio-cultural change  New pricing strategy

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 Clarify Problem or Opportunity

 Get precisely to the heart of the problem

 Challenge any preexisting assumptions by managers

 Consider conducting exploratory research

 Overcome “normal thinking” (a.k.a., bring a new perspective)

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 State Manager’s Decision Problem

 Discovery-oriented Decision Problem

 Answer “what?” or “why” questions
 Generate useful information

 Strategy-oriented Decision Problem

 Answer “how?” question
 Select alternative courses of action

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 Develop Possible Research Problems

 Decision Problem  Research Problem

 The problem facing the  A restatement of the
decision maker for which decision problem in
the research is intended to research terms
provide answers

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 Develop Possible Research Problems

 Discover-oriented Decision Problem

 Why are store revenues so low?

 Possible Research Problems for this Decision Problem

 Investigate current customer satisfaction
 Assess target market perceptions of store and competitors
 Determine target market awareness

 Possible Research Problem in the Form of a Question

 What are our current customer satisfaction levels?

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 Develop Possible Research Problems

 Strategy-oriented Decision Problem

 How do we increase store traffic?

 Possible Research Problems for this Decision Problem

 Investigate effectiveness of different sales promotions
 Determine consumer response to two proposed ad campaigns
 Measure consumer preferences for new store layouts

 Possible Research Problem in the Form of a Question

 How effective are our different sales promotions?

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 Select the Research Problem(s)
to be Addressed

 We recognize that there are multiple research problems for

every decision problem

 It is better to fully address one or two research problems than

try to address every possible research problem

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 Prepare Research Request Agreement

 A document prepared by the researcher after meeting with

the decision maker that summarizes the problem and the
information that is needed to address it

 A research request agreement helps to make certain that

everyone – researcher and client – understands the
problem(s) to be addressed, what the research is to
accomplish

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 Prepare Research Request Agreement

 Background

 Decision problem

 Research Problem(s)

 Use

 Population and subgroups

 Logistics

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 The Research Proposal

 A written statement that describes the marketing problem,

the purpose of the study, and a detailed outline of the
research methodology

 The research proposal differs from the research request

agreement because it is much more detailed and includes the
proposed research method

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 The Research Proposal

 Problem Definition and Background

 Research Design and Data Sources

 Sampling Plan

 Data Collection Forms

 Analysis

 Time Schedule

 Personnel Requirements and Cost Estimate

 Appendices
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 Research to Avoid

 Research that is unethical

 When the decision has already been made

 When there is a lack of resources to (1) do it right or (2)

implement resulting decisions

 When the costs of research are greater than its benefits

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 Request-for-Proposal (RFP)

 A document that describes, as specifically as possible, the

nature of the problem for which research is sought and that
asks providers to offer proposals, including cost estimates,
about how they would perform the job

 A RFP is issued by a company in order to solicit proposals

from research providers

 A RFP should be specific enough to allow easy comparisons

across vendors

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or in part.