Chapter One

The Role of Marketing Research in Management Decision Making

Copyright © 2004 John Wiley & Sons, Inc.

Learning Objectives

Learning Objective

1. To review the marketing concept and the marketing mix 2. To comprehend the marketing environment within which managers must make decisions 3. To define marketing research 4. To understand the importance of marketing research in shaping marketing decisions

John Willey & Son, Inc

2

Learning Objectives

Learning Objective

5. To learn when marketing research should and should not be conducted 6. To learn how the Internet is changing marketing research 7. To understand the history of marketing research

John Willey & Son, Inc

3

Nature of Marketing

Learning Objective To review the marketing concept and the marketing mix.

Marketing
– The process of planning and executing the conception, pricing promotion, and distribution of ideas, goods, and services to create exchanges that satisfy individual and organization objectives

Marketing Concept
1. Consumer Orientation 2. Goal Orientation 3. Systems Orientation

John Willey & Son, Inc

4

Nature of Marketing

Learning Objective To review the marketing concept and the marketing mix.

• Opportunistic Nature of Marketing Research
– Identify the target – Marketing mix

• The External Marketing Environment
– Marketing research is the key to understanding the environment – Provides information for altering marketing mix – Identifies new opportunities

John Willey & Son, Inc

5

Marketing Research and Decision Making

Learning Objective To define marketing research.

• Marketing Research Defined
– The planning, collection, and analysis of data relevant to market decision making and communication of the results of this analysis to management.

John Willey & Son, Inc

6

Marketing Research and Decision Making

Learning Objective To define marketing research.

• The Importance of Marketing Research to Management – Descriptive function – Diagnostic function – Predictive function • Unrelenting Drive for Quality and Customer Satisfaction
– Key competitive weapons of 2000s – Quality should not be achieved at expense of customer service – Return on Quality—new goal of companies

John Willey & Son, Inc

7

Marketing Research and Decision Making

Learning Objective To define marketing research.

– Paramount importance of existing customers
• Customer retention • Marketing research
– Used to understand customers’ needs and to satisfy those needs – Leads to customer satisfaction

– Understand the ever-changing market place

John Willey & Son, Inc

8

Marketing Research and Decision Making

Learning Objective To understand the importance of marketing researching shaping marketing decision.

• Proactive Role of Marketing Research
– Proactive management:
• alters the marketing mix to fit newly emerging patterns in economic, social, and competitive environments • new opportunities • develops a long-run marketing strategy

– Proactive manager – Proactive marketing strategic plan

John Willey & Son, Inc

9

Marketing Research and Decision Making

Learning Objective To understand the importance of marketing research.

• Applied Research versus Basic Research
– Applied research
• To better understand the market.

– Basic research
• To expand the frontiers of knowledge.

John Willey & Son, Inc

10

Decision to Conduct Marketing Research

Learning Objective To learn when marketing research should and should not be conducted.

• Decision to Conduct Marketing Research
– Reasons not to conduct marketing research • Resources are lacking • Research results would not be useful • Opportunity has passed • The decision has already been made • Managers cannot agree on what they need to know • Decision-making information already exists • The costs of conducting research outweigh the benefits
John Willey & Son, Inc

11

Exhibit 1.1

Learning Objective The Decision Whether to Conduct Market Research

Market Size

Small Profit Margin

Large Profit Margin

Small Cost likely to be greater than benefit;
e.g., eyeglasses replacement screw

Possible benefits greater than cost;
e.g., ultra expensive sportswear

Large Benefits likely to be greater than costs;
e.g., Stouffers frozen entries

Benefits likely to be greater than costs;
e.g.,medical equipment

John Willey & Son, Inc

12

Profound Impact of the Internet on Marketing Research

Learning Objective To learn how the Internet is changing marketing research

• Impact of the Internet • Growth Drivers of the Internet
– Provides more rapid access – Improves response time to customer needs – Increases follow-up studies and longitudinal research – Creates cost cutting opportunities

John Willey & Son, Inc

13

Profound Impact of the Internet on Marketing Research

Learning Objective To learn how the Internet is changing marketing research

• Internet Surveys Have Several Specific Advantages
– – – – – Rapid development, real-time reporting Dramatically reduced costs Personalization Higher response rates Ability to contact the hard-to-reach

John Willey & Son, Inc

14

Profound Impact of the Internet on Marketing Research

Learning Objective To learn how the Internet is changing marketing research

• Internet Enhances the Research Process and Dissemination of Information
– Virtually replacement of printed material – Distributions of request for proposals (RFPs) and the proposals themselves – Collaboration between effected parties – Data management and online analysis – Publishing and distribution of reports – Online presentation
John Willey & Son, Inc 15

Development of Marketing Research

Learning Objective To understand the history of marketing research

• The Inception—Pre-1900 • Early Growth—1920-1950 • The Mature Years—1950 to present

John Willey & Son, Inc

16

SUMMARY – – – – – – – –

Learning Objective

Marketing Concept External Marketing Environment Marketing Research Defined Proactive Role of Marketing Research Applied Research vs Basic Research When Not To Conduct Research Advantages of Internet Surveys The Development of Marketing Research

John Willey & Son, Inc

17

Learning Objective

The End

Copyright © 2004 John Wiley & Sons, Inc.

John Willey & Son, Inc

18