Marketing Research: An Applied Orientation

Seventh Edition

Chapter 1
Introduction to Marketing
Research

Copyright © 2019, 2010, 2007 by Pearson Education, Inc. All Rights Reserved.
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Chapter Outline
1) Overview
2) Definition of Marketing Research
3) A Classification of Marketing Research
4) Marketing Research Process
5) The Nature of Marketing Research
6) Marketing Research and Competitive Intelligence
7) Marketing Research Suppliers and Services
8) Selecting a Research Supplier
9) Careers in Marketing Research
10) The Role of Marketing Research in MIS and DSS
11) International Marketing Research
12) Marketing Research & Social Media
13) Mobile Marketing Research
14) Ethics in Marketing Research
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Redefining Marketing Research

The American Marketing Association

(AMA) redefined Marketing Research as:

The function which links the consumer, the

customer, and public to the marketer
through INFORMATION
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Redefining Marketing Research

Used to identify and
define market
opportunities and
problems
Generate, refine, and
evaluate marketing
performance
Monitor marketing
performance

Improve understanding
of marketing as a
process
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Definition of Marketing Research

Clearly, Marketing research emphasizes the need for information for
decision making. That is, Marketing research is Decision-oriented.
Decision-oriented

Based on this perspective, and for our purpose, Marketing research

is defined as:
The systematic and objective
 identification

 collection

 analysis

 dissemination

 and use of information

for the purpose of improving decision making related to the

 identification and

 solution of problems and opportunities in marketing.

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Market Research should:

 Specify the information necessary to
address these issues
 Manage and implement the data
collection process
 Analyze the results
 Communicate the findings and their
implications
 Help managers use this information to
make decisions
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Classification of Marketing Research

Problem Identification Research
 Research undertaken to help identify problems
which are not necessarily apparent on the
surface and yet exist or are likely to arise in the
future.
 Examples: market potential, market share, image,
market characteristics, sales analysis, forecasting,
and trends research.

Problem Solving Research

 Research undertaken to help solve specific
marketing problems.
 Examples: segmentation, product, pricing, promotion,
and distribution research.
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A Classification of Marketing Research

Marketing Research

Problem Problem Solving

Identification Research Research

Market Potential Research

Market Share Research
Market Characteristics Research
Sales Analysis Research
Forecasting Research
Business Trends Research
Segmentation Research
Product Research
Promotion Research
Distribution Research
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Problem Solving Research

Table 1.1
SEGMENTATION RESEARCH

 Determine the basis of segmentation

 Establish market potential and
PRODUCT RESEARCH
responsiveness for various
segments  Test concept
 Select target markets  Determine optimal product design
 Create lifestyle profiles:  Package tests
demography, media, and
product image characteristics  Product modification
 Brand positioning and
repositioning
 Test marketing
 Control score tests
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Problem Solving Research

Table 1.1 cont. PROMOTIONAL RESEARCH
 Optimal promotional budget
 Sales promotion relationship
 Optimal promotional mix
 Copy decisions
 Media decisions
 Creative advertising testing
 Evaluation of advertising effectiveness
PRICING RESEARCH  Claim substantiation
 Pricing policies
 Importance of price in brand selection
 Product line pricing
 Price elasticity of demand $ALE
 Initiating and responding to price changes
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Problem Solving Research

Table 1.1 cont.

DISTRIBUTION RESEARCH

Determine…
 Types of distribution
 Attitudes of channel members
 Intensity of wholesale & resale coverage
 Channel margins
 Location of retail and wholesale outlets
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Marketing Research Process

Step 1: Problem Definition

Step 2: Development of an Approach to
the Problem
Step 3: Research Design Formulation
Step 4: Fieldwork or Data Collection
Step 5: Data Preparation and Analysis
Step 6: Report Preparation and
Presentation
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The Role of Marketing Research

Fig 1.2 Customer Groups
• Consumers
• Employees
• Shareholders
•
Suppliers Uncontrollable
Controllable Environmental
Marketing Factors
Variables
• Product
Marketing • Economy
Research • Technology
• Pricing • Laws &
• Promotion Regulations
• Distribution • Social & Cultural
Assessing Marketing Factors
Providing
Information Information Decision • Political Factors
Needs Making

Marketing Managers
• Market Segmentation
• Target Market Selection

• Marketing Programs

• Performance & Control

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Marketing Research and Competitive Intelligence

 Competitive Intelligence (CI) is:
“the process of enhancing marketplace competitiveness
through a greater understanding of a firm’s competitors
and competitive environment”
 CI involves legal and ethical collection and analysis of
market information (i.e. capabilities, vulnerabilities, and
intentions of business competitors) through
information databases and marketing research
inquiry.
inquiry
 This intelligence is made available to decision makers.
 CI is a continuous process.
 CI provides early warning signals about the competitive
environment
 Although CI depends on market research for
information, it has evolved into a discipline of its own.
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The decision to conduct market research

The decision to conduct market research should
be guided by:
 The cost versus benefits of information
 Resources available to conduct market research
 Resources available to implement market the
research findings
 Management’s attitudes towards market research
(i.e. their should be a genuine reason to do
research, such as reducing uncertainty surrounding
an important management decision)
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Marketing Research Industry (suppliers & Services)

 Internal suppliers (located within the firm)
 External suppliers (outside research firms)
 Full-service suppliers (companies offering full range of services):
 Syndicated services (companies that collect & sell common data to serve
information needs shared by several clients)
 Standardized services (companies that use standard procedures to

provide market research to various clients)

 Customized services (companies that tailor research procedures to meet

needs of individual clients)

 Internet services (companies that use the internet to conduct market

research for their clients)

 Limited-service suppliers (companies that specialize in one or a few phases
of market research):
 Field services

 Coding and data entry services

 Analytical services (companies that provide guidance in research design)

 Data analysis services

 Branded marketing research products (companies specialized in

addressing specific types of research problems. They provide specific

research services that are patented, and given brand names)
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Criteria for Selecting a Research Supplier

 What is the reputation of the supplier?
 Do they complete projects on schedule?
 Are they known for maintaining ethical standards?
 Are they flexible?
 Are their research projects of high quality?
 What kind and how much experience does the
supplier have? Has the firm had experience with
projects similar to this one?
 Do the supplier's personnel have both technical and
non-technical expertise?
 Can they communicate well with the client?

Competitive bids should be obtained and compared on

the basis of quality as well as price.
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Example: Selected Marketing Research Job Descriptions

Research Director
Vice President of Marketing
Research • Also part of senior
• Part of company’s top management

management team • Heads the development

• Directs company’s entire market and execution of all

research operation research projects

• Sets the goals & objectives of the
marketing research department Assistant Director of Research
• Administrative assistant to director
• Supervises research staff members

Senior Project Manager

• Responsible for design, implementation, &
research projects
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Example: Selected Marketing Research Job Descriptions

Senior Analyst
• Participates in the development of projects
• Carries out execution of assigned projects
• Coordinates the efforts of analyst, junior analyst, & other personnel in the
development of research design and data collection
• Prepares final report

Analyst Statistician/Data Processing

• Handles details in execution of
project
• Designs & pretests questionnaires
• Conducts preliminary analysis of
data
• Serves as expert on theory and
application on statistical techniques
• Oversees experimental design, data
processing, and analysis

Junior Analyst Fieldwork Director

• Secondary data analysis • Handles selection, training,
• Edits and codes questionnaires supervision, and evaluation of
• Conducts preliminary analysis of data interviewers and field workers
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Preparation for a Career in Mktg. Research

 Take all the marketing courses you can.

 Take courses in statistics and quantitative methods.

 Acquire Internet and computer skills. Knowledge of

programming languages is an added asset.

 Take courses in psychology and consumer behavior.

 Acquire effective written and verbal communication

skills.

 Think creatively. Creativity and common sense

command a premium in marketing research.
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Management Information Systems vs.
Decision Support Systems

MIS characteristics DSS characteristics

 deal with Structured Problems  deal with Unstructured

 Use of Reports Problems
 Rigid Structure  Use of Models
 Information Displaying  User Friendly Interaction

Restricted  Adaptability
 Can Improve Decision Making  Can Improve Decision

by Clarifying Data Making by Using “What if”

Analysis
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Example: Marketing Research Associations Online

Domestic
AAPOR: American Association for Public Opinion Research
(www.aapor.org)
AMA: American Marketing Association (www.ama.org)
ARF: The Advertising Research Foundation (www.amic.com/arf)
CASRO: The Council of American Survey Research Organizations
(www.casro.org)
MRA: Marketing Research Association (www.mra-net.org)
QRCA: Qualitative Research Consultants Association
(www.qrca.org)
RIC: Research Industry Coalition (www.research industry.org)
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Example: Marketing Research Associations Online

International
ESOMAR: European Society for Opinion and Marketing
Research (www.esomar.nl)
MRS: The Market Research Society (UK)
(www.marketresearch.org.uk)
MRSA: The Market Research Society of Australia
(www.mrsa.com.au)
PMRS: The Professional Marketing Research Society (Canada)
(www.pmrs-aprm.com)
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International Marketing Research

 The United States accounts for about 40 percent
of worldwide marketing research expenditures.
 International marketing research should be
sensitive to differences in customs,
communication, and culture.
 The environment in the countries or international
markets that are being researched influences the
way the six steps of the marketing research
process should be performed.
 These environmental factors include marketing,
government, legal, economic, structural,
informational, technological, and sociocultural
factors.
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Marketing Research & Social Media (1
of 3)

 All social media share certain common characteristics

that make them very relevant as a domain for
conducting marketing research.
 Social media are marked by user-generated content.
 Users are able to rate, rank, comment on, review and
respond to the new world of media.
 People form online communities by combining one-to-
one (e.g., email and instant messaging), one-to-many
(web pages and blogs) and many-to-many (wikis)
communication modes.
 Social communities open up new avenues for
understanding, explaining, influencing, and predicting
the behaviors of consumers in the marketplace.
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Marketing Research & Social Media (2
of 3)

Limitations of Social Media

While the standard for objectivity is high for journalists,
expectations about objectivity among bloggers and other
social media users are lower.
Social media users may not be representative of the target

population in many marketing research applications.

Social media as a source of samples suffers from at least

two biases: from self-selection and from advocacy.

Yet, as long as these limitations are understood, insights

from social media analysis can uncover useful information

that can inform marketing decisions.
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Marketing Research & Social Media (3
of 3)

Social Media Summary

We advocate the use of social media as an additional
domain in which to conduct marketing research to
supplement and complement, but not to replace, the
traditional ways in which research is conducted.
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Mobile Marketing Research

 Marketing research, such as a survey, that is
conducted or administered to potential
respondents on their mobile devices.
 The mobile user base is huge and is only
expected to continue growing.
 Mobile internet usage has eclipsed desktop.
 MMR (mobile marketing research) can be
conducted via the international survey platforms
such as Confirmit (www.confirmit.com), through
the mobile services of access panels such as
Research Now (www.researchnow.com), or
through a specialist provider such as Locately (
http://locately.com).
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Advantages of Mobile Marketing Research

 MMR has the potential to reach a broader
audience, get results faster, lower costs, and
elicit higher quality responses.
 Global Positioning System (GPS) and other
location technologies can deliver surveys to the
target audience based on their current or past
locations.
 MMR is appealing in many developing
economies, where the mobile phone is often
the most frequently used information
gathering, computing, and communication
device for consumers and businesses.
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Disadvantages of Mobile Marketing Research

 Surveys must be kept short, succinct, and
simple. The norm is to ask no more than 15
questions and the entire process to take less
than 15 minutes.
 The questions that can be asked are definitely
more limited than those suitable on web sites
accessed by PC or other modes of survey
administration.
 Another serious limitation is the use of video
due to bad streaming and other technical
difficulties.
 Sample representativeness may be another
serious issue.
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Ethics in Marketing research

 Marketing research has four stakeholders:
1) Marketing researcher
2) Client
3) Respondents (subjects)
4) Society
 These stakeholders have responsibility to one
another, and
 should observe ethical standards in research
 Almost all research firms are profit seekers
 Sometimes, the profit motive could cause some
researchers to compromise objectivity and
professionalism, thus deviate from ethical
standards