review class summary Flashcards
Purpose of marketing research
3 functions: descriptive, diagnostic and predictive
Predictive: if then, predict decision outcome
Diagnostic: looking at what the problem is, diagnosing why something is a success, what explains this success, looking at marketing mix
Descriptive: find out more about the problem or what the problem is
Problem definition
Determine the business problem (more broad, describing an issue)
Translate it into a research problem (looking more specific an element of your marketing strategy)
Describe specific research objectives (wont be asked)
New coke case
Need to know this case study
Major takeaways
Pepsi was eating up market share so coke introduced the new coke
Pepsi was aggressively advertising, using celebrity endorsements, comparative advertisement and showed how people preferred pepsi to coke
Coke conducted blind taste test and many other tests and survey, they launched a new product called new coke that replaced the old coke
what was cokes mistakes
they put the coke in glasses instead of cans, they also didnt understand the loyalty of consumers (assumed that consumers only cxared about taste, people are emotionally evolved), they didnt tell consumers that new coke would replace original coke
Second mistake: actually research itslef, they did not adequately simulate the experience of people drinking coke, it matters how you simulate the experience, they gave people the drink in a glass and not a can, the amount also affects reward centres in the brain→ did not simulate real experience of drinking coke (people drink more and in a can)
Third mistake: didn’t tell consumers that new coke was going to replace old coke
* remember the takeaways
Product line extensions
Benefits:
Why would a company launc this: to capture market sections
Risk: cannibalization of your other products if there is not enough differentiation between the products and need good segmentation that you have not targeted , how to solve cannibalization: find new segment
Provide more value to customers when you have a product line extension
New coke as product line extension? Not sufficiently differentiated from old coke so this would not have worked, it offers the same value as the old coke
Coke zero or coke lite are different because they have zero calories and are differentiated from new coke or regular coke s there’s a clear differentiation and targeting a new segment
Coca cola life didnt work because people still had associations with coke being sugary
Have to take into account brand image and associations before suggesting a new value proposition
Brand extension:
goes into a new offering market like if coke made chips, enteering a completely new market
Exploratory
Describes a business problem
Secondary research is used → could give scenario and say secondary research is being used so you know its exploratory
Key to understand it:
May be conducted as part of a problem definition
Flexible and adaptive
Ex: understood root problem j crew
Less to do with customers more to do with other aspects of the business
Uses of exploration research:
Define terms
Clarify problems
Establish research priorities
Descriptive
Main goal: Describing a target market
Does not use secondary research, uses observation and survey
More rigid than exploratory
Exploratory is more describing the problem but not necessarily about the customer could be about rising costs
Want to understand your customer
Causal research
Determine causality
More rigid
Running experiments
Ex: does decreasing sugar content affect sales (sugar is the independent because its being manipulated, sales is the dependent variable and its being measured)
Usually generate hypothesis based on causal research (know this), every time you do causal research, have to have a hypothesis
Option: experiment
Examine differences between control and experimental groups under controlled conditions
making causal claims
When making causal claims, your looking at the relationship between two variables (correlation) and a correlation can be explained by causation but not necessarily, have to run an experiment
correlation= two variables share some kind of relationship, can be positive or negative or zero
Correlation can be caused by one way causality, two way causality, spurious and confound
A confound is when you have a relationship between x and y but caused by variable z that is correlated to both x and y, will have a confound when there is no experiment (not controlled and no randomization) there will be a confound
Superious correlation: no causal connection but just so happens that the variables are related
If specified its an experiment,
there are no confounds or spurious correlation so now is it one way causality (most likely)
If not specified that its an experiment, any 4 can be used, up to us to decide which of the 4 are at play
Experiment
Hypothesis
Independent variable→ being manipulated by experimenter , some element of the marketing strategy like if you change price or shelf placement ex price
Dependent variable → the variable the experimenter measures ex: sales,purchase intentions, willingness to pay, consumer attitudes , whether changing some aspect of the marketing strategy (4 ps) how that affects some variable of interest (usually something to do with sales or attitude)
Need randomization for an experiment
Internal validity:
are the findings due to the independent variable ( did I establish causality) → the way you determine this is through randomization and large sample sizes, sometimes there is n o true randomization which means the study is not internally valid→ hard to establish causality
External validity:
can I generalize the results to another group or another context? Usually field - experiments are externally valid bu lab experiments are not, field experiments at grocery store you are getting a sample very much of people who shop at grocery stores,if you use a lab sampling method you are using a convenience sample usually which is not fully representation, field experiments tend to examine people in the natural settings, larger samples, etc, whereas lab samples tend to be weird samples and convenient samples
Can run a field experiment, use more people, diversification of sample and context are very important
Ecological validity
Measuring real behaviour so like lab experiments suffer from ecological validity
Sustainability: people say they want to be sustainable, but in reality it doesnt translate to behavior, attitude behavior gap, this is why behavior is important to study
Field experiments are more ecologically valid than lab experiments because people are in their natural environment and you are looking at real life, but internal validity is a problem for field experiments
secondary vs primary data
Secondary: info that has been already gathered
Can be internal or external
Internal: company annual reports, sales, customer database
Remember examples of internal and external
Remember advantages and disadvantages of secondary data
Primary: you gather the data
Remember the advantages and disadvantages of secondary data
secondary data advantages
already avaiable
may provide background info
may improve primary data collection
not resource intense
secondary data disadvantages
may be out of date
may not be tailored to problem
may have accuracy or ethical issues
primary advantages
new and up to date
tailored to your problem
can offer additional insights
can ensure accuracy and ethical process
primary disadvantages
requires training and expertise
methods vary on speed and expense
Laddering
Important to know
Used a lot by marketing research companies
Good technique
Generating insights on brand equity, product categories
Want to uncover peoples psyhcholgy motivations
Peoples needs desires fears, etc
First you ask people what product
Why do laddering:
reposition or position a product in a way that targets peoples psychological motives
Laddering is effective when
when it comes to position strategies, crafting relevant messages, adaptive sales technique
limitations of laddering
tiring or boring, people need to b highly involved and like the brand , wont give you much info about different segments of consumers
Focus group
Grou[ discussion about a particular topic
Looking at group dynamics, interaction
Advantages and disadvantages
Group dynamics are a pro and con
Efficient way to collect responses fast
Can be non representative (not unique to focus groups) non representativeness is a problem for all research methods because of small sample sizes
Projective tests
Uncovering peoples attitudes, feelings
Types of projective tests: word association, sentence completion
Remember word association and sentence completion
Observation
Pros and cons (know them)
Small sample size is always an issue with qualitative research method
Cant really look at underlying psych like idis do
Predictions are difficult
Attitude, three components
Remember affective, behavioural, cognitive
Internet surveys
Advantages and disadvantages
Measurement errors
Response bias: due to intentional or intentional misrepresentation of into → participants are embarrassed to admit how much they love subway or misestimate how long they wait in line
Processing error: due to errors in data recording, transcription→ participant circled option a but you entered option d
Non response, response, interview, processing
Non response: specific sample and exclude others, non representative
Mapping techniques
Hierarchical vs perceptual
Surveys
Pros and cons
Standardized, easy to administer, easy to analyze, and subgroup differences—> you can do segmentation analysis with surveys (important!) only with quantitative not qualitative methods
How do they reveal subgroup differences? The number of people and randomization allow for this (larger samples= representative)
Research methods
segmentation/ cluster analysis: identifying segmentation and understanding different segments of the market and understanding their needs (cluster is always quantitative methods)
Laddering analysis: uncovering peoples psychology needs and tagretting them
Perceptual maps: coming up with a differentiation strategy , providing value and being different
idi vs focus groups
Know the advantages of IDI vs focus group
Idi: can examine more complex topics because its not a group dynamic so no pressure
Idi over focus group: no group dynamics at play (sometimes you want to study conformity and social influence in this case focus group is a good idea) if you dont want people to be influenced by others then choose idi
Key takeaway: idi doesnt have the group dynamics (focus groups do)
