Ch-4: Managing Marketing

Information to Gain
Customer Insights
Marketing research is a key prerequisite to
successful decision making.
When managers attempt to develop
strategies, marketing research assists

Following two rules must define all

marketing research:
 Know what the information is for
 Ask the right questions the right way
Customer insight
 Current understanding of customer needs
via marketing information
 There is a lot of information but marketers
need better info; and how to make better
use of info
 E.g. Metro etc. have data of thousands of
products
Marketing Information System (MIS)
consists of people and procedures
for:
 Assessing the information needs
 Developing needed information
 Helping decision makers use the information for
customer
MIS
Assessing Marketing Information
Needs
 Key users: Marketing and other managers
 Good MIS balances what users would like to
have against what they really need and what
is feasible to offer
 Developing Marketing Information
 Internal databases (gathered from different
departments)
 E.g. Pizza Hut recording consumer data upon order
VIP (Very-Into-Pizza)
 Marketing intelligence gathers and
analyzes secondary information (look for
Opportunities and Threats)
 E.g. Ford uses BrandIntel
 Competitors often reveal wealth of info
 P&G vs. Unilever (FMCGs)
 Also largest marketing spenders
 Protecting info from competitors (e.g.
Unilever trains its employees)
 KSE etc. are also info sources so is internet
Marketing Research
 Systematic gathering and analysis of data
relevant to a specific marketing situation
 Companies own Research Dept.
 Purchase from a marketing research company
 Hire a consultant.
Marketing Research Process

 4- steps
 Defining the Problem and
Research Objectives
 Exploratory research: used to gather
preliminary information to help define the
problem and suggest hypotheses
 Descriptive research: to better describe
marketing problems, situations or markets
 Causal research: to test hypotheses about
cause-and-effect relationships
e.g. iceberg
Developing the Research Plan

 Should be written
e.g. Tapal’s case (hardpack launch in Punjab)
A new SKU

 Secondary data
 Primary data
Secondary data
 May provide answers – or some background
 Quick to gather, cheap
 Marketing research companies e.g. AC
Neilsen
 Web search engines (may’ve too much info)
e.g. Federal Bureau of Statistics
(statpak.gov.pk)
WDI (World Development Indicators)
Economic survey of Pakistan
Primary Data
Research Approaches
1. Observational research (Banks, Shopping
centers).
Can obtain info people are unable or
unwilling to provide
Mystery shoppers

Limitations: Cant know people’s feelings etc.

Primary Data
Research Approaches
2. Ethnographic research (peoples and cultures
with their customs, habits, and mutual
differences.) involves sending trained observers
to watch and interact with consumers in their
natural environment
e.g. Nokia’s 1200 series for rural (multiple phone
books)
Limitation: It can’t grasp what people can’t
imagine. Henry Ford’s quote: If I’d asked people
what they wanted, they would’ve said faster
horses.
Primary Data
Research Approaches
3. Survey research (asking from people directly)
Most widely used, flexible.
Limitations: People cant answer what they cant
recall, may answer for the sake of it etc.
4. Experimental research is best for gathering
causal information—cause-and-effect
relationships (charge two different prices and
saw the effects)
 Contact Methods (Strengths &
Weaknesses)
Mail Telephone Personal Online
Flexibility
Quantity of data
collected
Control of
interviewer effects
Speed of data
collection
Response rate

Cost
 Contact Methods (Strengths &
Weaknesses)
Mail Telephone Personal Online
Flexibility Poor Good Excellent Good
Quantity of data Poor Fair Excellent Poor
collected
Control of Excellent Fair Poor Fair
interviewer effects
Speed of data Poor Excellent Good Excellent
collection
Response rate Poor Fair Good Poor

Cost Good Fair Poor Excellent

 When researching customer needs,
would it be better for a product
designer to visit customers personally or
to read a survey research report on
customer needs, beliefs and behaviors?
What biases are inherent in each
approach that might lead to
misunderstanding consumer behavior?
 Focus group (6-10 people with a moderator)
 Online marketing research: Fast and low-
cost; especially good for quantitative; also
used for qualitative as online focus groups
Multiple ways including real time
Sampling plan:
Sample is representative of ‘population’
 Who is to be surveyed?
 Sample size?
 Sampling procedure? Probability and non-
probability sampling.
 Types of Samples
Probability Sample

Simple random sample Every member of the population has a known and equal chance
of selection

Stratified random sample The population is divided into mutually exclusive groups and
random samples are drawn from each group

Cluster (area) sample The population is divided into mutually exclusive groups and the
researcher draws a sample

Non-probability Sample

Convenience sample The researcher selects the easiest population members

Judgment sample The researcher uses their judgment to select population

members
Quota sample The researcher finds and interviews a prescribed number of
people in each of several categories
Research instruments
 Questionnaires
Closed (easy to interpret)
Open-ended (good for exploratory)
Advantages and limitations of qualitative and
quantitative data
 Mechanical Instruments
People meters, checkout scanners, neuro-
marketing (studying consumers'
sensorimotor, cognitive, and affective
response to marketing stimuli)e.g. Unilever’s
Vim line
Types of close-ended questions

 Dichotomous: Two choices e.g. yes/no

 Multiple choice: 3 or more.
 Scale: Two extremes with various options
 Likert scale: Amount of agreement (strongly
agree to strongly disagree
 Importance: Very to least
 Rating: Excellent to poor
Questionable questions
 What is your salary?
 Are you strong or weak supporter of …?
 Do your children behave well at …?
 What are most salient (or best) attributes in
…?
 Volvo is the safest car on road, right? (leading
question)
Customer Relationship Management (CRM)

 Managing detailed information about

individual customers and carefully managing
customer touch points in order to maximize
customer loyalty
 Came in early 2000s
 Purpose is to organize data about customers
 Data warehouses (companywide electronic
database of customer info)
 CRM has costs and benefits
Other Marketing Information
Considerations
 Marketing Research in small businesses and
nonprofit organizations
 SMEDA (www.smeda.org)
 International Marketing Research
Problems of language, culture, secondary
data availability etc.
 Implementing research plan
 Interpreting and reporting research findings
Researcher or manager should not be biased
 Public Policy and Ethics in Marketing Research

 Intrusions on Consumer Privacy

 E.g. Google shows different results on different PCs
 Sony’s PSN was hacked
 DSW (a chain of 200 shoe stores in USA) had lots of
amount stolen from its own stores via hackers
 Misuse of Research Findings
 Why is secondary data sometimes preferred
to primary data?
 In the absence of company problems, is there
any reason to develop a marketing research
team/system?
 Why a company might want to do focus
group interviews rather than individual
interviews with the same people?