final Flashcards
Marketing Research
- Specifies information
- Designs the method for collecting information
- Manages the data collection process
- Analyzes and communicates the results
By conducting marketing research on the various factors in the marketing environment,
you can do your best to remove any kind of uncertainty
Marketing Research allows businesses:
- To better understand their products/services
- To monitor their competitors
- To understand industry market trends
The Marketing Research Process
- Formulate the Problem
- Determine Research Design*
- Gather Data
- Analyze & Interpret Data
- Prepare the Research Report
Three major categories of groups conducts marketing research
- Producers of products and services
- Advertising agencies
- Marketing research companies
Producers of products and services
Organizations that produce products or deliver services for businesses or consumers often conduct research designed to develop and market their products and services
Examples of producers of products and services
a. Ex: ESPN, Unilever & Apple – Have internal marketing research departments
b. Target, Walmart & Zara – Operate research departments to gather information about consumer preferences, store image, etc
Advertising agencies
Conducts research designed to help create and measure the effectiveness of advertising campaigns
Examples of advertising agencies
a. Ex: Marketing and Advertising agencies – Testing alternative approaches to the words or graphics used in an ad, effectiveness of celebrity spokespeople, etc.
b. INNOCEAN Worldwide
Marketing research companies
Companies that specialize in conducting marketing research
Examples of marketing research companies
a. Ex: Nielsen Holdings – Provides product-movement data for grocery stores and drug stores, as well as television ratings
Other firms specialized in custom-designed research:
- Field service – data collection
- Limited-service – both data collection and analyze the data
- Government agencies, trade associations and universities
Problem formulation process
- Meet with the client
- Clarify the problem/opportunity
- State the manager’s decision problem
- Develop a full range of possible research problems
- Select a research problem that best address the manager’s decision problem
- Prepare and submit the research request agreement to the client
What occurs in 1. Meet with the client
- Need to gather as much information as possible about the problem at hand
- Get the broader context more than a more specific task
- Is issue planned or unplanned change
Planned change
more future-oriented and being proactive (i.e., increase revenue)
Unplanned change
issues that occur unexpectedly (i.e., new technology)
What occurs in 2. Clarify the problem/opportunity
- Help managers get precisely to the heart of the problem
- Researchers are responsible for ensuring that root causes and clear paths of actions are determined
- One of the toughest steps
What occurs in 4. Develop a full range of possible research problems
- Each of the possible research problems beings with an action word (ex. “investigate”, “determine”, etc)
- Describes information to be uncovered that might help solve the decision problem
Managers decision problem describes…
the manager’s view of the situation
Research problem
a restatement of the decision problem in research terms, from the researcher’s perspective
What occurs in 5. Select a research problem that best address the manager’s decision problem
- Review each possible research problem
- The trade-off between the benefits of the information to be obtained,
- The importance of the decision problem(s) to be made,
- And the costs of obtaining that information
Research Request Agreement
a document prepared by the research team after meeting with the decision maker that summarizes the problem and the information that is needed to address it
What are the sections in a research request agreement
- Background
- Decision problem
- Research problems
- Use
- Population
- Logistics
Decision problem
The basic problem facing the manager, for which marketing research is intended to provide answers
A well-stated decision problem takes the managers perspective
and takes the form of a question
Two types of decision problems
- Discovery-oriented decision problem
- Strategy-oriented decision problem
Discovery-oriented decision problem
- Seeks to answer “What?” or Why?” questions about a problem/opportunity
- The focus is generally on generating useful information
Strategy-oriented decision problem
- Seeks to answer “How?” questions about a problem/opportunity
- The focus is generally on selecting alternative courses of action
What are the three research designs
- Exploratory
- Descriptive
- Casual
Exploratory Research
The major emphasis is on gaining ideas
Types of exploratory research
- Internet search
- Literature search
- Depth interviews
- Focus groups
- Case studies
Exploratory research is conducted to provide more information to better understand a situation NOT
to produce answers or decisions
In exploratory, researchers hope to
produce hypotheses about what is going on about a situation
Internet and literature search
- One of the quickest and least costly ways to discover hypotheses is to conduct
- MUST START HERE
What are some examples of internet and literature search
news articles, report studies, US census bureau, much more
Depth interviews
Second most important step just getting out there talking to people and asking questions
Researchers should interview with people
knowledgeable about the general subject being investigated
Examples of people to interview
current customers, target market members, executives and managers of the client, sales reps, wholesalers, retailers, and much more!
Focus groups
- An interview conducted among a small number of individuals simultaneously
- relies more on group discussion than on directed questions to generate data
In focus groups discussion is directed by
the moderator who is an individual who meets with focus group participants and guides the session
Case studies
Intensive study of selected examples of the phenomenon of interest
Examples of case studies
examining existing records, conduct unstructured interviews, people are carefully observed
Descriptive Research
emphasis is on determining the frequency with which something occurs or the extent to which two variables covary
Descriptive is super common in
business, not to mention life in general
Descriptive research is used to
- To describe the characteristics of certain groups
- To determine the proportion of people who behave in a certain way
- To make specific predictions
- To determine relationships between variables
Exploratory research studies are
flexible and is more of an informed overload
Descriptive research studies require
specification of the who, what, when, where, why and how of the given research
Casual research
emphasis is on determining cause-and-effect relationships
While we may not be certain that a change in one variable produces a change in another, we can conduct
research to narrow the likely casual relationship between two variables by eliminating the other possible causes that we are aware of
Causal research designs work toward
establishing possible causal relationships through the use of experiments
Experiment
a scientific investigation in which an investigator manipulates and controls one or more independent variables and observes the degree to which the dependent variables changes
Three types of ways to use marketing information services
- Profiling customers
- Measuring product sales and market share
- Measuring advertising exposure and effectiveness
Profiling customers is done
through market segmentation
If firms can group their customers into relatively homogeneous groups, they can
tailor marketing programs to the groups, making the programs more effective and the customers more satisfied
Measuring product sales and market share
Organizations need an accurate assessment of how they are doing if they are to succeed in an increasingly competitive environment
How do organizations measure product sales and market share
review internal records and determine how much they have sold into the channel of distribution (i.e. wholesalers, distributors, etc.)
ex: online diary panels, scanners
Measuring advertising exposure and effectiveness
- Internet
- Television
- Social media
- Multimedia services
Two main advantages of secondary data
Time and money
Secondary data does not completely solve the problem under study, but will do
- Help you better state the problem under investigation
- Suggest improved methods or further data that should be collected
- Provide comparative data that can help interpret primary data if such data is collected
Two main disadvantages of secondary data
- They often don’t fit the current problem very well
- They are sometimes not accurate
Internal secondary data
Data that comes from internal sources
Internal secondary data are often the
lease costly and most readily available of any type of marketing research
External secondary data
Data that comes from external sources
External secondary data: Published data (Before and during your search for published data)
- Identify what you wish to know and what you already know about your topic
- Develop a list of key terms and names
- Search several of the general guides and directories and web sites for papers and/or reports
- Compile the literature you have found. Rework your list of key words and authors if necessary
Types of primary data
- Demographic/socioeconomic characteristics
- Personality/lifestyles characteristics
- Attitudes
- Awareness/Knowledge
- Intentions
- Motivation
- Behavior
Demographic characteristics
- age
- education
- occupation
- marital status
- gender
- income
Personality refers to the
normal patterns of behavior exhibited by an individual – the attributes, traits and mannerisms that distinguish one individual from another
Attitude
an individual’s overall evaluation of something
Awareness
what respondents do and do now know or believe about some product, brand, company, advertisement, or other element
Person’s intentions
refer to their anticipated or planned future behavior
* receive less attention in marketing than some other types of primary data
Motive
a need, want, drive, urge, wish, desire, impulse, or any inner state that directs behavior towards goals
Two methods to obtain primary data
Communication and observation
Communication
questioning respondents to get the information you need using a questionnaire
Observation
DOES NOT involve questioning
Researchers instead carefully watch individuals in a particular situation and record their behaviors in detail
Communication method of data collection has advantages
- Versatility
- Speed
- Cost
Versatility
ability to collect information on the different types of primary data that marketers care about
Observation method of data collection have the advantages
Objectiveness and accuracy
Which is more preferred when examining consumer behavior
Observation research
Which is more expensive? Observation or Communication
Observation
Structured observation
applies when the research problem has been defined precisely enough so that you can specify the behaviors to observed as well as the categories used to record and analyze the situation
Unstructured observation
used for studies in which the research problem has not been precisely defined and you have a great deal of flexibility in terms of what to note and record
Disguised observation
when those being observed don’t know they are being observed
Undisguised observation
when they do know
Natural setting for observation
subjects are observed in the environment where the behavior normally takes place
contrived setting for observation
subjects are observed in an environment that has been specially designed for recording their behavior
Human observation
is where individuals are trained to systematically observe something and record on the observational form what takes place
Electrical/mechanical observation
where a device observes instead of a human
the scales of measurement
- nominal
- ordinal
- interval
- ratio
nominal
the measurement in which numbers are assigned to objects or classes of objects solely for the purpose of identification
Example of nominal
Ex: social security #
* Basketball jerseys
* Male respondents = 1, female respondents = 2
* Numbers don’t mean anything other than simple individual or category identification
Ordinal
measurement in which numbers are assigned to data on the basis of some order (ex. More than, greater than) of the objects
Example of ordinal
- It is impossible to say how much any individual prefers more than the other
- Ex: rank the soft drinks of the following according to your degree of liking for each, assigning your most preferred drink rank = 1 and your least preferred drink rank =6
Interval
measurement in which the assigned numbers legitimately allow the comparison of the size of the differences among and between members
An example of interval
- The intervals between the numbers tell us how far apart the objects are with respect to the attribute
- Allow us to say that one brand is preferred over another by comparing scores and which brand is generally liked or disliked
Ratio
measurement that has a natural, or absolute, zero and therefore allows the comparison of absolute magnitudes of the numbers
Example of ratio
EX: height, weight
* Can compare intervals, rank objects according to magnitude, use the numbers to identify the objects
* EX: in the past seven days, approx. how many 12-ounce servings of each of the following soft drinks have you consumed?
Developing a questionnaire
- Specific what information will be sought
- Determine method of administration
- Determine content of individual questions
- Determine form of response to each question
- Determine wording of each question
- Determine question sequence
- Determine physical characteristics of questionnaire
- Develop recruiting message or script
- Reexamine steps 1-8 and revise if necessary
- Pretest questionnaire and revise if necessary
Three methods of collecting questionnaire data
- Personal interviews
- Phone interviews
- Web-based questionnaires
Census
if you collect information from or about each member of the relevant population
Sample
a selection of a subset of elements from a large group of objects
Population
a complete set of what you want to measure
What does it mean by defining the target population
all the individuals or objects that meet certain requirements for membership in the overall group
The simpler the definition of the target population
the easier it will be to find the sample
sampling frame
the list of population elements from which a sample is drawn
* geographic areas
* institutions
* individuals
there are no perfect sampling frames
but you should always case a big net
Two sampling procedures
Non-Probability Sampling and Proability Sampling
Non-Probability
- When the units are of the sample are selected based on convenience or judgement
- NOT a random procedure
Proability
- When a random technique is used to select units of a sample
- The sample is based on chance and every member has a known probability of selection
does size of the population have a direct effect on the size of the sample
no
3 types of non-probability samples
- Convenience
- Judgement
- Quota
Convenience samples
population elements are included in the sample because they were readily available
Judgement samples
the elements are handpicked because they are expected to serve the research purpose
Quota samples
the proportion of sample elements with certain characteristics is about the same as the proportion of the elements with characteristics in the target population
Probability samples
each target population elements has a known nonzero chance of being included in the sample
5 types of probability samples
- simple random
- systematic
- stratified
- cluster
- multi-stage cluster
Simple random sample
basically just pulling out names of a hat or selecting via random procedure
Systematic sample
we pick every X person from our sampling frame
Stratified sample
use this to represent various subgroups of the population
Cluster sample
where the entire population is divided into groups and a random sample of these clusters are selected. Instead of sampling consumers you sample a cluster of consumers are a higher level
Multi-stage cluster sample
involves using two or more probability techniques above
Types of errors
- Sampling error
- non-coverage error
- Non-response error
- Response error
- Office error
Sampling error
- Affects projects that rely on samples drawn from a population
- The difference between results obtained for a sample and the results we would have obtained had we gathered the information from the entire population
- This error isn’t as significant as the other four
Noncoverage error
- Error due to the failure to include some elements of the defined target population in the sampling frame
- Essentially is sampling frame issue
- Ex: Loss of previous consumer information (emails, etc.)
Nonresponse error
- Error from failing to obtain information from some elements of the population that were selected and designated for the sample
- Ex: “How successful recent school graduates are?”
Response error
Error that occurs when an individual provides an inaccurate response, consciously or subconsciously, to a survey item
Office error
Error due to data editing, coding or analysis errors
6 ways to improve response rates
- survey length
- guarantee of confidentiality
- Interviewer characteristics and training
- Personalization
- Response incentives
- Follow-up surveys
What is editing?
the process of checking completeness, consistency of data and making the data ready for coding
What is coding?
when we take the answers from the questionnaire and put them in numeric form
Primary tasks in the editing process
- Convert all responses to consistent units
- Access degree of nonresponse
- When possible, check for consistency across responses
- Look for evidence that respondent wasn’t really thinking about his or her answers
- Verify that branching questions were followed correctly
- Add any needed codes
Marketing data analytics process
- Get the data
- Organize and merge the data
- Analyze
- Act
Big data sources
- Internal company data
- Online retailers
- Search engines
- Social media
Data from traditional sources
- Internal company data – consider your own interactions with companies:
- Data from traditional primary sources
What are the steps in cleaning the collected data
- Validation and editing the data (quality control)
- Coding
- Data Capture
- Logical cleaning of data
- Tabulation and statistical analysis
Types of analytics
- Descriptive analytics
- Predictive analytics
- Prescriptive analytics
Descriptive analytics
Data summarized in basic forms to discern patterns
What is an example of descriptive analytics?
Ex: collecting median data for potential new homebuyers
Predictive analytics
Predicts what customers or potential customers will do in response to various marketing programs or classify them into market segment or other subgroups
Prescriptive analytics
Tells us the best course of action in a given situation
Give an example of prescriptive analytics
Ex: Airlines adjusting fares for different destinations based on the time of the year
Handling missing data
- Eliminate the case with the missing item(s) from all further analyses * Eliminate the case with the missing item in analyses using the variable
- Substitute values for the missing items
- Contact the respondent again
What is Market Testing?
- involves the use of a controlled experiment done in a limited but carefully selected section of the marketplace
-* sed to predict the sales or profit outcomes
What are the key issues to Market Testing?
- Cost
- Time
- Control
What are the three types of test markets?
- Standard Test Market
-the company sells the product through its normal distribution channel - Controlled Test Market
-conducted by an outside service - Simulated Test Market
-consumer ratings and other information are fed into a computer model
