Week 2: Understanding customer needs Flashcards
What happens when a company does NOT understand customer needs?
- Wastes: time, money, resources, and in many instances: jeopardises the business' survival
- sales teams will try selling products consumers don’t want and pushing a good/service on a customer will fail
- Superficial tactics e.g., bribing consumers with ads and discounts only works in the short-run, in the long-run if the product isn’t aligned with customer needs it’ll fail.
- Without shared understanding of customer needs within the business, an organisational silo emerges where each business function does its own thing without any coordination b/n them.
The goal of market research is…
to support decision making with customer insight
Marketing research must be…
- necessary
- precise
- up-to-date (to the best possible)
Nowadays the market research problem is..
finding the right information, at the right time, for the right person.
All marketing research is constrained by…
time, money and skills. It might be too time consuming, too costly, OR impossible to attain cuz of ethics.
Primary research is..
Data collected specifically for the problem at hand.
The organisation collects the data themselves.
Pro’s and Con’s of primary research
Con’s:
- More expensive
- more time consuming
Pro’s:
- Focus on specific research
- Control over what data produced
- Current (info will be up to date)
Secondary research is..
Existing data that has been collected with a different purpose.
Use of info from a third party e.g., industry report or academic paper.
Pro’s and Con’s of Secondary research
Pro’s:
- quicker
- less expensive/free
Con’s:
- can be biased
- can be outdated
- lack of control
- usefulness can be limited as it wasn’t developed for this specific problem
When tackling a marketing decision problem, what type of research should we start with?
Secondary research - as it can help you understand whats happening. Can give insight on what has already been done + gaps that exist in the knowledge, and what traps to avoid.
Use market data you already have e.g., use sales and customer care specialists as sources. also gov. , academic institutions etc.
Helps identifying marketing decision + research problems + aids in research process e.g., hypotheses, sampling.
In cases it can be the only way to obtain data e.g. historical data
What to be observe and be aware of while collecting secondary research
- trustworthiness of the source
- original purpose of the data collection (was there any funding behind the project that can create bias or shape the research goals?)
- Accuracy of the data
- Methods used ( method used may not be suited for the research)
Quantitative research is..
- interested in large populations
- Measure and predict preferences, attitudes, behaviour
- offer statistical validation of ideas (hypothesis)
- Estimate market size
- Determine most effective price point,
- Generalise results
- Closed ended questions defined before the study by the researcher - the researcher needs to anticipate everything they want to collect data on; there’s little or no room for new info to come up.
Qualitative research..
- understands groups and individuals in-depth
- always strives to not separate the consumer from the context where they live, in order to uncover and understands feelings, thoughts, and opinions
- Explores the dimensions of specific marketing problem the company is experiencing
- Allows researcher to put themselves in the shoes of their research participants and try to understand the world from their point of view
- Generate ideas and develop hypotheses - usually good for innovation
- Asks open ended questions -it is interested in finding and covering things that the researcher didn’t anticipate.
- Discover customer needs that you didn’t think about before
- takes more time than quantitative
Consumers may not be aware of their needs themselves because..
- they may not be able to articulate their needs
- sometimes they are only able to articulate basic care variables (price of entry into any industry)
- it is hard to imagine life with new innovations (e.g., the SONY walkman)
- sometimes consumers aren’t willing to admit to themselves and researchers that they’re not the healthy or super conscious consumer that they ideally want to be
Truly innovative companies when creating “customer needs”:
- Go beyond what customers are willing or capable to tell them in marketing research studies
- Create markets for products consumers will want once they are available e.g., SONY walkman.
…… refers to the measurement of brain activity to learn how consumers feel and respond.
Neuromarketing
With the recent explosion of information technologies, ________.
most marketing managers are overloaded with data and often overwhelmed by it.
While collecting sensitive customer data, market researchers should adhere to all of the following guidelines EXCEPT…
sharing information without the customer’s authorization
A good marketing information system balances the information users ________ to have against what they ________ and what is ________ to offer.
would like; need; feasible
________ refers to the measurement of brain activity to learn how consumers feel and respond.
Neuromarketing
A good marketing information system balances…
the information users WOULD LIKE to have against what they NEED and what is FEASIBLE to offer
What is an advantage of using an internal database?
Internal databases can be accessed more quickly and cheaply than other information sources
