Session 2.

Introduction and Research Problem

MKTG 3010 MARKETING RESEARCH

What a marketer should do? (What

marketing is about?)

The right Product

The right Place
The right Price
The right Person
The right Time
Whether the customer is
satisfied?

Why we need marketing research?

is to figure out what

other people are
thinking and feeling.

is to figure out that what

other people think and
feel isnt actually exactly
like what we think and
feel..

(Alison Gopnik, TED talk, Oct 2011)

What is Marketing Research

Marketing research is 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.

Marketing Research Process

Step 1: Defining the Problem
Step 2: Developing an Approach to the Problem
Step 3: Formulating a Research Design
Step 4: Doing Field Work or Collecting Data
Step 5: Preparing and Analyzing Data

Step 6: Preparing and Presenting the Report

5

A Career in Marketing Research?

Marketing Research Industry

Research
Suppliers

External

Internal

Full Service
Limited Service
Syndicated
Services

Internet
Services
Customized or
Standardized
Services

Field Services

Other Services
eg. Data analysis

Top 10 Global Research Organizations

Rank
2009 2008

Organization

Headquarters

Parent
country

Web site
(www.)

No. of
Countries
with
Subsidiaries/
Branch
Offices

Global
Revenue
(USD
millions)

Percent of
global
revenue
from
outside
home
country
(%)

The Nielsen Co.

New York

U.S.

Nielsen.com

100

4,628.0

50.3

Kantar

London &
Fairfield, Conn.

U.K.

Kantar.com

80

2,823.2

75.0

IMS Health Inc.

Norwalk, Conn.

U.S.

Imshealth.com

75

2,189.7

63.4

GfK SE

Nuremberg

Germany

Gfk.com

59

1,622.8

74.1

Ipsos Group SA

Paris

France

Ipsos.com

64

1,315.0

89.8

Synovate

London

U.K.

Synovate.com

62

816.4

85.0

SymphonyIRI

Chicago

U.S.

Symphonyiri.com

706.3

37.5

Westat Inc,

Rockville, Md.

U.S.

Westat.com

502.4

Arbitron Inc.

Columbia, Md.

U.S.

Arbitron.com

385.0

1.5

10

10

INTAGE Inc.

Tokyo

Japan

Intage.co.jp

368.6

1.7

Career in Marketing Research

Marketing research firms (e.g., AC Nielsen)

Business and non-business firms and agencies with inhouse marketing research departments (e.g., Procter
& Gamble, Coca-Cola, AT & T, the Federal Trade
Commission, United States Census Bureau)

Advertising agencies (e.g., BBDO International, Ogilvy

& Mather, J. Walter Thompson,Young & Rubicam)

Consulting firms (e.g. McKinsey, BCG )

10

Advice from the textbook

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.
11

In this course

Lets pretend to be market researchers

Sport Bra Study

One day I received a
wechat message from a
former classmate.
His company was
manufacturing a new
product, sport bra and
wanted help analyzing
the data he had collected
while conducting a
marketing research
study.

Sport Bra Study

When we met, he
presented me with a copy
of the questionnaire and
asked how he should
analyze the data. My first
question to him was,

Sport Bra Study

When he looked
confused, I
explained that data
analysis is not an
independent
exercise.

Rather, the goal of data analysis is to PROVIDE

INFORMATION RELATED TO THE PROBLEM.

Sport Bra Study

I was surprised to learn that he did

not have a clear understanding of
the marketing research problem
and that a written definition did not
exist. So before going any further,
I had to define the marketing
research problem.

Step 1: Problem Definition

Whats the research question?

The most serious mistakes are not being

made as a result of wrong answers.
The true dangerous thing is asking the
wrong question.
Peter F. Drucker

The Process of Defining the Problem and

Developing an Approach
Tasks Involved
Discussion
with
Decision Maker(s)

Interviews
with
Experts

Secondary
Data
Analysis

Qualitative
Research

Environmental Context of the Problem

Step I: Problem Definition

Management Decision Problem

Marketing Research Problem

Step II: Approach to the Problem

Objective/
Theoretical
Foundations

Analytical
Model: Verbal,
Graphical,
Mathematical

Research
Questions

Hypotheses

Step III: Research Design

Specification
of
Information
Needed

Think about a marketing research problem

Management Decision Problem Vs. Marketing Research Problem

Management-Decision Problem

Marketing Research Problem

Asks what the decision maker needs

to do

Asks what information is needed

and how it should be obtained

Action oriented

Information oriented

Focuses on symptoms

Focuses on the underlying causes

Management Decision Problem Vs. Marketing Research Problem

Management Decision Problem

Marketing Research Problem

Should a new product be

To determine consumer preferences

introduced?

and purchase intentions for the

proposed new product

Should the advertising

To determine the effectiveness

campaign be changed?

of the current advertising

campaign

Should the price of the

To determine the price elasticity

brand be increased?

of demand and the impact on sales

and profits of various levels of price changes

Link MRP to MDP using a Conceptual Map

Management wants to (take an action)

Therefore, we should study (topic).

So that we can explain (question).

Link MRP to MDP using a Conceptual Map

Management wants to (develop retention

MDP

MRP

programs that will retain 90 percent of heavy users of wireless

services and lead to 10% higher sales over the next 2 years )

Therefore, we should study (heavy-user

loyalty).

So that we can explain (what will be the most

MRP

important variables in retaining these customers over the

next 2 years).

Proper Definition of the Marketing Research

Problem

Problem Definition involves stating the general problem

and identifying the specific components of the marketing
research problem.
Two Common Errors Too broad no clear guideline for the subsequent steps

e.g. (from text book) develop a marketing strategy for the brand;
Improve the competitive position of the firm
Improve the companys image

Too Narrow preclude consideration of some courses of

action

e.g. how to respond to a price cut initiated by a competitor?

Redefined as improving the market share and profitability of the
product line.

Marketing Research Problem

Broad
Statement

Component
1

Component
2

Component
3

SPECIFIC COMPONENTS

Step 2: Develop an Approach

What information do I need?

Marketing Research Process

Step 1: Defining the Problem
Step 2: Developing an Approach to the Problem
Step 3: Formulating a Research Design
Step 4: Doing Field Work or Collecting Data
Step 5: Preparing and Analyzing Data

Step 6: Preparing and Presenting the Report

28

Example Cathay Pacific, as other major airlines, had to deal with

passenger loyalty (management decision problem: how
to attract more and more loyal passengers). The broad
marketing research problem was to identify the factors
that influence loyalty of airline travelers.

The basic answer is to improve service. Exploratory

research, theoretical framework, and empirical evidence
revealed that the consumers choice of an airline is
influenced by: safety, price of the ticket, frequent-flyer
program, convenience of scheduling, and brand name.

Graphic Model

A graphical model stipulated that

consumers evaluate competing airlines
based on factors of the choice criteria to
select a preferred airline. The problem
was that major airlines were quite
similar on these factors. Indeed, "airlines
offer the same schedules, the same
service, and the same fares.
Consequently, Cathay Pacific had to find
a way to differentiate itself.

Awareness

Evaluation

Preference

How?

Patronage

Secondary data, like the J. D Power & Associates'

survey on "current and future trends in the airline food
industry," indicated that "food service is a major
contributor to customers loyalty." This survey also
emphasized the importance of food brands.

The airline's Marketrak survey told Cathay Pacific that

"customers wanted more varied and up-to-date food.
The following research questions and hypotheses may be
posed.

RQ1 How important is food for airline customers?

H1:

Food is an important factor for airline travelers.

H2:

Travelers value branded food.

H3:

Travelers prefer larger food portions, but with

consistent quality.

H4:

Travelers prefer exotic food.

This kind of research helped Cathay Pacific define their marketing

research problem and develop the approach. Focus groups and
surveys were conducted to check customers' perceptions of food in
Cathay Pacific's aircraft. The results provided support for all the
hypotheses (H1 to H4).

Components of an Approach

Objective/Theoretical Foundations

Analytical Framework and Model

Analytical model is an explicit specification of a set of variables

and their interrelationships designed to represent some real
system or process in whole or in part.

Research Questions and Hypotheses

Objective evidence is unbiased evidence that is supported by

empirical findings
Theory is a conceptual scheme based on foundational statements
or axioms, that are assumed to be true

Research questions are refined statements of the specific

components of the problem.
A hypothesis is an unproven statement or proposition about
a factor or phenomenon that is of interest to the researcher.

Specification of the Information Needed

Now try it yourself -- Harley Goes Whole

Hog ( Textbook p 67-68)

What was the management decision problem?

What was the marketing research problem?
How did they arrive at the problems?
What are the components of the broad statement?
What theory was used in developing the approach?
Give an example of the research question and the
hypotheses related to it.
What information is identified to be needed?

Step 3: Research Design

how to collect the information

Definition

A research design is a framework or blueprint for

conducting the marketing research project.

It details the procedures necessary for obtaining the

information needed to structure or solve marketing
research problems.

A Classification of Marketing Research

Designs
Research Design
Conclusive
Research Design

Exploratory
Research Design

Descriptive
Research
Cross-Sectional
Design
Single CrossSectional Design

Causal
Research

Longitudinal
Design

Multiple CrossSectional Design

Exploratory & Conclusive Research Differences

Exploratory

Conclusive

Objective:

To provide insights and

understanding

To test specific hypotheses and

examine relationships

Characteristics:

Information needed is defined

only loosely. Research process is
flexible and unstructured.
Sample is small and nonrepresentative. Analysis of
primary data is qualitative

Information needed is clearly

defined. Research process is formal
and structured. Sample is large and
representative. Data analysis is
quantitative

Findings/
Results:

Tentative

Conclusive

Outcome:

Generally followed by further

exploratory or conclusive
research

Findings used as input into decision

making

The Three Basic Research Designs

Exploratory

Descriptive

Causal

Objective:

Discovery of ideas
and insights

Describe market
characteristics or
functions

Determine cause
and effect
relationships

Characteristics:

Flexible, versatile

Marked by the prior

formulation of specific
hypotheses

Often the front end

of total research
design

Preplanned and
structured design

Manipulation of
independent
variables, effect
on dependent
variables

Expert surveys
Pilot surveys
Case studies
Secondary data:
qualitative analysis
qualitative research

Secondary data:
quantitative analysis
Experiments
Surveys
Panels
Observation and other
data

Methods:

Control mediating
variables

How to classify this research method?

https://www.youtube.com/watch?v=nV0jY5V
gymI

Next week

Group Formation (Submit group form by

6pm on Sep 20)
Group Project Topic
Remind
Class Attendance will be taken in the
beginning of the class!