Definition of Marketing Research

It is the process of systematic collection and analysis of market information and data for the purpose of important decision making in marketing

Relevance Of Marketing Research Today
Today¶s business decisions are extremely complex and a large variables are involved Globalization and liberalization has intensified competition and survival has been at stake Optimization of all levels to reduce costs

Relevance Of Marketing Research Today
Employees and shareholders are becoming increasingly aware of their rights to participate in decision making More and more organizations are turning from selling to marketing concept The tools used for research increased and organizations increasingly practicing data mining have are

What Constitutes Good Market Research Clearly defining the problem and purpose Process of research well described Research design thoroughly planned Maintaining high ethical standards Limitations clearly revealed Adequate analysis of the data Findings presented unambiguously Conclusions justified Integrity of researcher .

Why Market Research Sometimes Fails When the problem is not carefully designed When researchers are less competent. not well trained and lack creativity When sufficient time and finance is not provided When there exists a lack of co-ordination and understanding between researchers and marketing managers .

Pros & cons of In-house M R Activity Better knowledge of the company. background and current problems Better control and liaison Commitment may be higher More assurance of confidentiality . its history.

Pros & cons of In-house M R Activity Commissioning costs can be lower Lack of objectivity due to close relations with clients Friendship and company politics .

Pros of Outsourced M R Activity Good value A wider skill base Objectivity Anonymity .

Pros of Outsourced M R Activity Superior facilities Agency specialization Less chance of bias since a fresh look is possible .

Evaluation of external agency Personal recommendation Recommendations by trade associations Experience and Qualifications of key personnel Matching agency specializations of the agency to the need Agency orientation towards client¶s decision makers .

Evaluation of external agency Facilities and resources of the agency Level of creativity and innovation in previous research Time conscious and organization culture Stability and reliability of the agency personnel .

Qualities of a good Researcher Must be innovative and ready to look at any problem with fresh perspective Must have skill and knowledge and prepared to try out new ideas Must be familiar with recent developments in industrial sectors. markets. Must be familiar with and absorb recent trends in research techniques Must have considerable selling skills to convince the top management or sponsor regarding the accuracy and soundness of recommendations . products etc.

Research Proposal Defined It is a researcher¶s offer to render market research service to a potential buyer or a sponsor .

Purpose Of Proposal To present management question to be researched and its importance and relevance To indicate the research efforts of other researchers on related management questions To highlight the data necessary for solving the management questions To present the methodology of the research To state the means of gathering and treating the data and interpretation of the data .

Discover Management Dilemma Define Management Question Exploration Define Research Question Refine Research Question Exploration Research Proposal .

Research Design Design Strategy (type. time frame. purpose. scope) Data Collection Design Sampling Design Question & Instrument Pilot Testing Instrument Revision .

Data Collection & Preparation Data Analysis & Interpretation Report Management Decision .

Benefits Of Making Proposal It helps the researcher to have a tentative work plan Charts the logical steps needed to accomplish the stated goals It helps the researcher to review the project steps It helps the researcher to assess previous approaches to the problem and revise the plan accordingly .

Benefits Of Making Proposal It provides an opportunity to spot errors in assumptions and correct them if necessary It gives the time and budget estimates It becomes a milestone for the sponsor to review the progress of the study It serves as a logical guide for investigation .

Why Ethical Considerations in MR ‡ To ensure confidentiality for the sponsor organization ‡ To protect the rights of the respondents ‡ To ensure the client or sponsor organization receives genuine findings from the study ‡ To protect the safety of the researcher and the tea ‡ To ensure integrity in MR .

More About Research Ethics Ethical practices are the means to ensure that no one is harmed or suffers adverse consequences from the research activities There is no single approach to ethics Strict adherence to a set of laws is not practical since researcher is subjected to unforeseen constraints .

More About Research Ethics Many design based ethical problems can be eliminated by careful planning and constant vigilance Responsible research anticipates ethical dilemmas and adjusts the design and procedures to overcome them Be fair and frank about the limitations of research with the client as also respondents .

Do not overstate or understate the benefits Assure that the rights and well being of respondents will be protected. Show by destroying names etc. Take informed consent of the respondents Clearly state that sensitive questions may not be answered . explain the benefits to the respondents.Ethical practices towards respondents Before starting data collection.

intentions and expectations of respondents .Survey Research The communication approach involving questioning people and recording their responses for analysis It is the most versatile approach for the collection of abstract information of all types An economical and efficient means of learning opinions and attitudes.

Survey Research It depends greatly upon the ability and willingness of respondents Interpretation of the question by the respondent can greatly vary their responses .

Observation Survey A method of collecting past and current data by recording observation It can be used to collect data even when respondents are hostile or unable to give information Data can be collected as it occurs in its natural environment .

Observation Survey It can record the information which most respondents would ignore It is less demanding and has less bias involved It is a slow and expensive process and involves interpretation skills and needs to be used with care and understanding .

Questionnaire Design A researcher first needs to answer 4 basic questions ±  What type of data is needed to answer management questions?  What communication approach will be used?  Should the questions be structured. to what degree? . unstructured or a combination?  Should the questioning be undisguised or disguised and if so.

Forms of Questionnaire Structured : It is a formal list of questions framed to generate facts Unstructured : It is one in which questions are not structured and the order in which they are to be asked is left to the researcher Disguised : A questionnaire where the object of inquiry is not revealed to the respondent. or unstructured Undisguised : It is one where the object of inquiry is revealed to the respondent . It can be structured.

true or false etc. length and details of the answer Dichotomous questions : They have only 2 answers in the form of yes or no.Types of Questions Open ended questions : They give respondent complete freedom to decide the form. Multiple choice questions : Here the respondent is offered two or more choices and the respondent has to indicate the one applicable in his case. .

Phrasing and Ordering of Questions Difficult words should be avoided as far as possible Lengthy questions should be avoided Two or more questions should not be combined into one .

Phrasing and Ordering of Questions Questions lacking specificity should be avoided Simple questions should be asked in the beginning of the interview Specialized questions needing in-depth information should be left at the end .

free from coercion and unethical practices Consent must be adequately informed to make a decision Respondents must be told of the risks involved if any .Characteristics of informed consent Respondent must be capable of giving free consent Consent must be voluntary.

Classification of Research Designs The degree to which the question crystallized (exploratory or formal) has been The method of data collection (observational or communicative) Purpose of the study (finding who. when and why) The time dimension (once or repetitive study) The topical scope (case study or statistical study) . what.

Exploratory Research It is a preliminary investigation where the researcher is not sufficiently knowledgeable The focus is to bring out different ideas relating to the management problem It is generally secondary data based on readily available It is an informal and unstructured design It is independent of the size of the research .

Exploratory Research A researcher is asked for a help by the new management of an oldest and most reliable bank concerned about the erosion of profitability Management Dilemma: How can we improve our profit? .

Exploratory Research This management Dilemma does not specify what kind of research needs to be done This question is broad and is strictly managerial in thrust It does not indicate the route to be taken by the bank to increase profit .

downsizing the manpower. or by some other means .Exploratory Research The route to be taken by the bank to increase profit may be via increase in deposits. increase in loan disbursements. outsourcing less value adding jobs outside.

Exploratory Research Now the management question becomes a two sub-question based: How can we improve deposits? How can we reduce costs? .

It becomes obvious that the bank operations are not as progressive as its competitors¶ and has its costs well in line.Exploratory Research A small focus group is conducted among employees and data is analyzed to compare financial and operating statistics with profitable banks. .

Exploratory Research Now the revised management question becomes: What should be done to make the bank more competitive? .

most reliable institution . progressive institution with appropriate changes in services or policies Or Maintain its image as the oldest.Exploratory Research Now the Research question becomes: Should the bank position itself as a modern.

Exploratory Research The investigative questions become: 1. How attractive are various services? c. What specific financial services are used? b. What bank-specific and environmental-specific factors influence a person¶s use of a particular service? . What is the public¶s position regarding financial services and their use? a.

What are demographic differences between our and competitors customers? c.Exploratory Research 2. How aware is the public of the bank¶s promotional efforts? d. What are the geographic patterns of our customers and of our competitors¶ customers? b. What is the bank¶s competitive position? a. How does growth in services compare among competing institutions? . What opinion does the public hold of the bank and its competitors? e.

the group should consist of 8-10 representatives The representatives should be homogeneous to have a meaningful discussion It should be conducted by an experienced specialist whose role is of a catalyst FGD is fast and cheap and is the method for generating the hypothesis They are flexible in approach. direct and easily understandable to the client The limitation is that the sample may be inadequate since it may be drawn on the basis of convenience .Focus Group Discussion It is a formal discussion between representative samples on a particular subject Ideally.

Advantages of F G D
Ability to quickly and inexpensively grasp the core issues of a topic They are brief and extremely flexible Provide an opportunity to observe reactions to the research questions in an open ended group setting They bring out surprise information and new ideas

Descriptive Research
‡ The focus of this research is to answer the ³who, what, when, where and how´ of the management dilemma These studies are factual and can be complex at times They are formal and well structured and hence the research process should be well defined in the planning stage Descriptive research can be of 2 types ± Cross sectional studies which are concerned with a sample of elements from a given problem Longitudinal studies which are based on panel data and panel methods

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Descriptive Research
In the bank example, we may be interested in developing a profile of savers by analyzing data: ‡ Size of accounts ‡ No. of accounts for minors ‡ No. of accounts opened in last six months ‡ Amount of activity in the account ‡ Gender of account holders ‡ Nearness to workplace/home

Causal Research John Stuart Mill formulated a set of principles for Causal research When two or more cases of a given phenomenon have one and only one condition in common then that condition may be regarded as the cause of the phenomenon .

Causal Research A B C Z C D E Z C Z .

Causal Research Advantage: Helps ruling out irrelevant factors Limitation: Other factors not considered may be influencing the phenomenon .

Causal Research John Stuart Mill improved the logic by having a negative canon If a change in the amount of one variable is accompanied by a comparable change in the amount of another variable in two or more cases. one change is the cause of the other . and the latter change does not occur in the absence of the first change.

Causal Research A B C Z Non A B Non C Z C Z .

Causal Research It investigates the cause and effect relationship between 2 or more variables The study is based on the 3 possibilities viz symmetrical. . reciprocal and asymmetrical relationships A symmetrical relationship exists when 2 variables fluctuate together in spite of being independent of one another A reciprocal relationship exists when 2 variables mutually influence or reinforce each other Asymmetrical relationship exists when changes in the dependent variable are responsible for changes in the independent variable.

habits and drives.g. gender. change in Govt. opinions. It includes attitudes. Age. social class and taxation .g. effect of age on saving. policy results in company performance Property-disposition relationship: A property is an enduring characteristic of a subject that does not depend on circumstances for its activation. price rise results in sales reduction. family status ethnic group are personal properties.Causal Research Stimulus-response relationship: Represents an event that results in a response from object e. A disposition is a tendency to respond in a certain way under certain circumstances. E.

In-depth Interview It involves a detailed probing of the respondent by specialist interviewer An informal approach where appropriate questions are developed during the interview The focus is to identify and record subtle reactions of the respondent It discovers the hidden motivations affecting consumer behaviour It provides a strong stimulus to the insights of the researcher Being unstructured. the information can be subjective leading to different interpretations by different researchers of the same information .

Sampling Sampling ± It is the process of selecting some elements in the population which are true representatives of the population Population ± It is the total collection of elements about which we wish to make some inferences Census ± It is a count of all elements in a population .

precision of estimate. The smaller the standard error of estimate. the higher is the precision of sample Sample Size ± It is a function of the variation in the population parameters under study .Sampling Good sample ± It is one which well represents the characteristics of the population it purports to represent It must have accuracy that is. the degree to which bias is absent from the sample and precision that is.

Decide the target population Develop a frame Choose Sampling technique Decide the sample size Choose sampling methods .

Sampling Frame Decide on each type of element that will be covered to represent the population .

e. statistical Non-probability i.e.Sampling Technique Probability based i. judgmental sampling .

derive a sample size arithmetically .Sample Size Calculate the standard deviation of population Decide the sampling error acceptable to the specific study under consideration On the basis above.

beginning with a random start of an element in the range of 1 to k .Sampling Methods Simple random ± It is the method in which each element of the population has an equal chance of selection Systematic sampling ± Here. every kth element in the population is sampled.

Sampling Methods Stratified random sampling ± Here the population is divided into mutually exclusive and exhaustive strata and then a simple random sample is selected within each of the strata Cluster sampling ± It is one where entire group or clusters are selected at random instead of selecting individual units from the population .

e. we want to conduct a survey of households numbering 2.Sampling Methods Quota sampling involves fixation of certain quotas to be fulfilled For example.00. 2000 households 1200 in rural area and 800 in urban .000 in totality A quota of 1% is fixed i.

Sampling Methods Independent Controls Rural Urban 1200 800 Rich Middle class Poor 150 650 1200 2000 Total 2000 Total .

Sampling Methods Inter-related Controls Rural Rich Middle class Poor Total 100 400 700 1200 Urban 50 250 500 800 Total 150 650 1200 2000 .

Advantages of Quota Sampling Economical Administratively convenient Time saving Suitable when a sampling frame is not available .

Disadvantages of Quota Sampling Calculation of standard error may be difficult May not be representative Quality may suffer Bias creeps in into the process .

Other forms of Judgmental Sampling Master sample Panel sample Convenience sample .

Types Of Scales
Nominal scales : Numbers serve as labels to identify persons, objects or events. The identification can be made on the basis of a certain characteristic or attribute. Here, a set is split into subsets which are mutually exclusive and collectively exhaustive Ordinal scales : These are ranking scales which besides having the unique characteristics of the nominal scale, indicate the order by distinguishing elements on the basis of single direction

Types Of Scales
Interval scale : They are the combination of nominal and ordinal scales with additional strength of determination of the equality of differences. Ratio scales : They possess order, distance and unique origin and are the most superior amongst all scales.

Criteria for Ascertaining Good Scale
Reliability : It is the extent to which repeat measurements made by it under constant conditions will yield the same result. Validity : It is the success of the scale in measuring what it sets out to measure, so that the difference between individual¶s scores can be taken as representing true differences in the characteristic under study.

Depending upon the acceptance or rejection of a statement by the respondent.Attitude Scales Paired comparison scale : It requires the respondent to select two objects of a set with regard to an attribute of interest Thurstone scale : It is a technique in which a large number of statements in a random order are administered to one or more respondents in the form of a questionnaire. his scale score is determined by averaging the scale values for the statements accepted by him .

e.4. strongly approve.Attitude Scales Summated rating scale :  Researcher collects a large number of statements and eliminates those which are ambiguous. disapprove. irrelevant or deficient  The remaining statements are administered to one or more respondents for their reaction using a five point rating system i.3. approve.2 and 1 respectively . and strongly disapprove. undecided.  These categories are assigned value 5.

this scoring is reversed  The correlation between the statement scores and the total score is ascertained  Statements with a high correlation with total score are selected for final scale .Attitude Scales  In case of negatively worded statements.

attraction or repulsion from an object . an individual with a more favourable attitude score than another must be just as favourable or more favourable in his response to every statement in the set than the other individual ‡ Semantic differential : This technique involves three dominant factors viz.Attitude Scales ‡ Scalogram analysis : This method of scaling is based on the assumption that. potency and activity factor. It is a bi-polar scale conforming to the basic concept of motivation. evaluation.

The errors can be in the form of inconsistency in the responses.Data Processing ‡ Editing : It is the process of identifying. examining errors and omissions in the collected data and making necessary corrections. partial or a vague response .

it will be impossible to reduce a large number of heterogeneous responses into meaningful categories resulting in a weak and ineffective data analysis. . In the absence of coding.Data Processing ‡ Coding : It is the procedure of classifying the answers to a question into meaningful categories to carry out subsequent operations of tabulating and analysis.

Data Processing ‡ Tabulation : It comprises sorting of the data into different categories and counting the number of cases that belong to each category. Tabulation can be ±  Univariative  Bivariative  Multivariative .

which should ideally be in the form of a written document ‡ Principles of good report :  Report must be written objectively  Written in a concrete and impersonal style  Organized and coherent  Absolute clarity of ideas  Precise. to the point. neat and tidy in approach .Report Writing ‡ The findings and interpretation of the research study needs to be reported to the management or the sponsor in the form of a formal report.

charts and illustrations Findings Limitations Summary and conclusions Executive summary/recommendations Appendices and bibliography .Report Format ‡ An ideal market research report follows the following format ±            Title page Name of sponsor Index of contents Introduction Methodology Statistical tables.

Statistical Methods for Data Analysis ‡ Correlation ±  It is a statistical technique used for measuring the relationship or interdependence of two or more variables  A graph of the two series in question is drawn. known as cattle diagram  Values of two variables are plotted such that a point on the graph indicates a pair of values  Independent variable is taken on the X axis and the dependent on the Y axis .

 When relationship between two variables is linear. a change in the independent variable is followed by a constant absolute change in the dependent variable.Statistical Methods for Data Analysis ‡ Regression analysis ±  It is a technique used for estimating or predicting the value of one variable given the value of another.  The model does not necessarily imply any cause and effect relationship between two variables.  The relationship is given by the equation Y=a+bX .

 There needs to be high homogeneity within the cluster and high heterogeneity between clusters.  Used extensively in marketing research for resolving the problem of classifying consumers. . products etc.Statistical Methods for Data Analysis ‡ Cluster analysis ±  Used to classify persons or objects into a small number of mutually exclusive and exhaustive groups.

.Applications of Marketing Research contd ‡ Advertising effectiveness ±Recognition study  Carried out for printed advertisement and referred to as a readership study.  Respondents are shown a particular page of the magazine and the following measures of recognition are taken ± o Noted : The percentage of readers who have seen the ad o Seen ± associated : The percentage of readers who read a part of the ad indicating the brand o Read must : Percentage of readers who read a major part of the ad  Scores are assigned to these and related to the expenditure incurred.

Applications of Marketing Research ‡ Advertising effectiveness ±Recall test ±  Respondents are asked to recall specifics of an ad  Copies of test magazines are sent to a sample of respondents for normal reading  Respondents are read out a list of ads and asked to identify those they remember and the extent to which they can recall  Scores are assigned to the ability of the respondent to remember name of the product. underlying message. and favourable attitude. .

Applications of Marketing Research ‡ Advertising effectiveness ±Sales test ±  This method measures the effect of an ad on sale of the products  Assumption is that. changes in sales are a result of ad  Isolate the influence of other factors while determining the impact of an ad .

Experimental Design Experimental Treatment ± It is a study of alternatives whose effects are to be measured and compared Test units ± The individuals or organizations whose response to the experimental treatment is being studied Experimental Error ± A measure of the apparent variation in performance of test units treated alike by the experimenter after the effect of extraneous forces is removed from the data. . Extraneous forces ± All other forces and conditions which affect the response of test units to experimental treatments.

Experimental Design It originated in the field of agricultural research It is the process in which the researcher intervenes to manipulate the indirect or exploratory variable in a setting and observe how it affects the subject being studied There must be a complete agreement of independent and dependent variables The 2 variables must occur almost simultaneously Other extraneous variables should not influence the dependent variable .

Advantages of Experimental Design Researcher¶s ability to manipulate the independent variable Effect of extraneous variables can be controlled more effectively Convenient and cost effective design Replication of an experiment with different subject groups and conditions is possible .

many applications of experimentation far outrun the budgets for other primary data collection methods Experimental studies of the past are not feasible There are limits to the type of manipulation and controls that are ethical .Disadvantages of Experimental Design Artificiality of the laboratory Generalization from non probability samples can pose problems despite random assignment Despite lower costs of experimentations.

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