Chapter 1

Introduction and Early

Phases of Marketing
Research

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 Chapter Outline
1) Overview

2) Definition of Marketing Research

3) A Classification of Marketing Research

4) Marketing Research Process

5) The Role of Marketing Research in Marketing

Decision Making

6) Marketing Research and Competitive Intelligence

7) The Decision to Conduct Research

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 Chapter Outline
8) Marketing Research Suppliers and Services
9) Selecting a Research Supplier
10) Careers in Marketing Research
11) The Role of Marketing Research in MIS and DSS
12) The Department Store Project
13) International Marketing Research
14) Ethics in Marketing Research
15) Summary

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 Redefining Marketing Research

The American Marketing Association (AMA)

redefined Marketing Research as:

The function that links the consumer,

the customer, and public to the
marketer through INFORMATION

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 Redefining Marketing Research
Identify and define
market opportunities and
problems

Generate, refine, and

evaluate marketing
performance

Monitor marketing
performance

Improve understanding
of marketing as a
process
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 Definition of 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.

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 What Market Research Does?

Specifies the information necessary

to address these issues
Manages and implements the data
collection process
Analyzes the results
Communicates the findings and their
implications
Helps managers use this information
to make decisions

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 Classification of Marketing Research

Problem-Identification Problem-Solving
Research Research
Research undertaken to Research undertaken to
help identify problems help solve specific
which are not marketing problems
necessarily apparent on
the surface and yet exist
or are likely to arise in
the future

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 A Classification of Marketing Research
Fig. 1.1
Marketing Research

Problem Problem-Solving
Identification Research Research

Market Potential Research

Segmentation Research
Market Share Research
Product Research
Market Characteristics Research
Pricing Research
Sales Analysis Research
Promotion Research
Forecasting Research
Distribution Research
Business Trends Research

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 Problem-Solving Research
Table 1.1

SEGMENTATION RESEARCH
Determine the basis of segmentation
Establish market potential and
responsiveness for various
PRODUCT RESEARCH
segments
Test concept
Select target markets
Determine optimal product design
Create lifestyle profiles:
demography, media, and Package tests
product image characteristics Product modification
Brand positioning and repositioning
Test marketing
Control score tests
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 Problem-Solving Research
Table 1.1 cont. PROMOTIONAL RESEARCH
Optimal promotional budget
0.00% APR
Sales promotion relationship
Optimal promotional mix
Copy decisions
Media decisions
Creative advertising testing
Evaluation of advertising effectiveness
PRICING RESEARCH
Pricing policies Claim substantiation

Importance of price in brand selection

Product line pricing
Price elasticity of demand $ALE
Initiating and responding to price changes
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 Problem-Solving Research
Table 1.1 cont.
DISTRIBUTION RESEARCH

Determine
Types of distribution
Attitudes of channel members
Intensity of wholesale & resale coverage
Channel margins
Location of retail and wholesale outlets

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 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

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 Problem Definition
Most difficult job Tasks involved:
Take into account:
The purpose of the study,
the background
information, the
information needed, and
how it will be used in
decision making
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Discussions with DMs
Interviews with industry
experts
Analysis of secondary
data, and
Qualitative research like
FGD, in-depth interviews
1-14
 Development of an Approach

Needs to formulate:
An objective or theoretical
framework
Analytical models
Research questions and
hypotheses
Identifying the information
needed

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 Research Design Formulation

A framework or blueprint for conducting the MR

Details the procedures for conducting research
Definition of the information needed
Secondary data analysis
Qualitative research
Methods of collecting quantitative data
Measurement and scaling procedures
Questionnaire design
Sampling process and sample size
Plan of data analysis

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 Fieldwork or Data collection

Collecting data from field or from

office
through personal interview, by
phone, through mail and mail
panel surveys with pre-recruited
households
or electronically
Involves proper selection, training,
supervision, and evaluation of the
field force help minimize data
collection errors

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 Data Preparation and Analysis

Data preparation includes editing,

coding, transcription, and verification
of data.
Number or letter codes are assigned to
represent each response to each
question
Data are analyzed to derive relevant
information

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 Report Preparation and Presentation
Entire project is documented in a
report which
identifies research questions
identified
describes the approach, research
design, data collection, data
collection and analysis procedures
presents the results and findings
Findings are presented in a
comprehensible format
Oral presentation can be made

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 The Role of Marketing Research
Fig. 1.2 Customer Groups
Consumers
Employees
Shareholders
Suppliers
Uncontrollable
Controllable Environmental
Marketing Factors
Variables
Marketing Economy
Product
Research Technology
Pricing
Laws &
Promotion Regulations
Distribution Social & Cultural
Assessing Marketing Factors
Providing
Information Information Decision Political Factors
Needs Making

Marketing Managers
Opportunity identification
Market Segmentation
Target Market Selection
Marketing Programs
Performance & Control
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 Power Decisions Methodology
Fig. 1.3

Opportunity scan
Option generation
Solve Problem
Refine options
Decision
Client
Needs Find Seek Plan Act

Achieve Goal

Research Evaluate Market Advise

How We Clarify
Recommend Plan Assist
Decisions Analysis Interpret
Help Facilitate Research Execution

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 Marketing Research and
Competitive Intelligence

CI involves the legal collection

CI is the process of
and analysis of information
enhancing marketplace regarding the capabilities,
competitiveness vulnerabilities, and intentions
through a greater of competitors by using
understanding of a information databases and
firms competitors and other open-sources
the competitive
CI is a crucial part of emerging
environment knowledge economy

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 When NOT to Conduct Marketing
Research
Lack of resources to conduct MR
Lack of resources to implement
research findings
The costs outweigh the benefits
Lack of time
Managements negative attitude
toward MR
Decision-making information already
exists
The decision has already been made

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 Organizational Chart for VNU
Fig. 1.4
Executive Board
Corporate Staff

Marketing Media Measurement Business

& Information Directories
Information Information
ACNielsen Nielsen Media Research VNU Business Golden Pages
VNU Advisory Nielsen/Net Ratings Publications Gouden Gids
Services Nielsen Film VNU emedia & Paginas Amarelas
BASES Entertainment Information Marketing Paglni Auril
Claritas Nielsen Home VNU Expositions Promedia
Spectra Entertainment VNU Exhibitions Europe Telkom Directory
Market Decisions Nielsen Music Verizon Puerto Rico
Nielsen Book
Nielsen Entertainment Intel
IMS
PERO/HIC
Scarborough
SRDS
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 Marketing Research Suppliers & Services
Fig. 1.5

RESEARCH
INTERNAL EXTERNAL
SUPPLIERS

FULL SERVICE LIMITED SERVICE

Field Other
Internet Services
Syndicated Services
Services
Services
Customized
Focus Groups Technical
Services
and and
Qualitative Analytical
Services Services
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 Selected Marketing Research
Career Descriptions
Fig. 1.6
Vice President of Marketing Research: The senior position in
marketing research. The vice president (VP) is responsible for the
entire marketing research operation of the company and serves on
the top management team. This person sets the objectives and goals
of the marketing research department.
Research Director: Also a senior position. The research director has
the general responsibility for the development and execution of all
the marketing research projects.
Assistant Director of Research: Serves as an administrative assistant
to the director and supervises some of the other marketing research
staff members.
(Senior) Project Manager: Has overall responsibility for design,
implementation, and management of research projects.
Statistician/Data Processing Specialist: Serves as an expert on
theory and application of statistical techniques. Responsibilities
include experimental design, data processing, and analysis.
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 Selected Marketing Research Career
Descriptions
Fig. 1.6 cont.
Vice President of Marketing Research Director
Research Also part of senior
Part of companys top management
management team Heads the
development and
Directs companys entire market
execution of all
research operation research projects
Sets the goals & objectives of the
Assistant Director of Research
marketing research department
Administrative assistant to director
Supervises research staff members

Senior Project Manager

Responsible for design, implementation, &
research projects

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 Selected Marketing Research
Career
Fig. 1.6 cont.
Descriptions
Senior Analyst
Participates in the development of projects
Carries out execution of assigned projects
Coordinates the efforts of analyst, junior analyst, & other personnel in the
development of research design and data collection
Prepares final report

Analyst Statistician/Data Processing

Handles details in execution of Serves as expert on theory and
project application on statistical techniques
Designs & pretests questionnaires Oversees experimental design, data
Conducts preliminary analysis of data processing, and analysis

Junior Analyst Fieldwork Director

Secondary data analysis Handles selection, training,
Edits and codes questionnaires supervision, and evaluation of
Conducts preliminary analysis of data interviewers and field workers

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 Criteria for Selecting a Research
Supplier

What is the reputation of the supplier?

Do they complete projects on schedule?
Are they known for maintaining ethical standards?
Are they flexible?
Are their research projects of high quality?
What kind and how much experience does the
supplier have? Has the firm had experience with
projects similar to this one?
Do the supplier's personnel have both technical and
non-technical expertise?
Can they communicate well with the client?

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 Careers in Marketing Research
Career opportunities are available with marketing
research firms (e.g., AC Nielsen, Burke)
Careers in business and non-business firms and agencies
with in-house marketing research departments (e.g.,
Procter & Gamble, Coca-Cola, the Federal Trade
Commission, United States Census Bureau)
Advertising agencies (e.g., BBDO International, Ogilvy &
Mather, J. Walter Thompson)
Positions: VP of marketing research, research
director/assistant director, project manager, field work
director, statistician/data processing specialist,
senior/junior analyst, and supervisor.

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 A Sample of Marketing Research Jobs

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 Preparation for a Career in Marketing Research

Take all the marketing courses you can

Take courses in statistics and quantitative
methods
Acquire Internet and computer skills (also
programming languages)
Take courses in psychology and consumer
behavior
Acquire effective written and verbal
communication skills
Think creatively. Creativity and common
sense command a premium in MR
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 The Role of Marketing Research in
MIS and DSS

MIS is a set of DSS is a set of computerized

formalized information systems for
procedures for generating, analyzing, storing,
generating, and distributing pertinent
analyzing, storing, information to marketing
and distributing decision makers on an ongoing
pertinent information basis
to marketing decision Enables decision makers to interact
directly with databases and analysis
makers on an models
ongoing basis An integrated systems including
hardware, database, softwarebase,
communication network, etc.
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 MR As a Part of MIS

MIS collects much information from MR

and other sources like internal records,
marketing intelligence on an on-going
basis

MR provides information on an ad-hoc

basis and less information than does MIS

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 Management Information Systems
Vs. Decision Support Systems
Fig. 1.7

MIS DSS

1. Structured Problems 1. Unstructured Problems

2. Use of Reports 2. Use of Models

3. Rigid Structure 3. User Friendly Interaction

4. Information Displaying 4. Adaptability

Restricted
5. Can Improve Decision
5. Can Improve Decision Making Making by Using What if
by Clarifying Data Analysis

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 The Department Store Project
The following information was solicited:
1. Familiarity with the ten department stores.
2. Frequency with which household members shopped at each
of the ten stores.
3. Relative importance attached to each of the eight factors of
the choice criteria.
4. Evaluation of the ten stores on each of the eight factors of
the choice criteria.
5. Preference ratings for each store.
6. Rankings of the ten stores (from most preferred to least
preferred).
7. Degree of agreement with 21 lifestyle statements.
8. Standard demographic characteristics (age, education, etc.)
9. Name, address, and telephone number.
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 Marketing Research Associations Online
Domestic
AAPOR : American Association for Public Opinion Research
(www.aapor.org)
AMA : American Marketing Association (www.ama.org)
ARF : The Advertising Research Foundation
(www.amic.com/arf)
CASRO : The Council of American Survey Research
Organizations (www.casro.org)
MRA : Marketing Research Association (www.mra-net.org)
QRCA : Qualitative Research Consultants Association
(www.qrca.org)
RIC : Research Industry Coalition
(www.researchindustry.org)
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 Marketing Research Associations Online

International
ESOMAR: European Society for Opinion and Marketing
Research (www.esomar.nl)
MRS: The Market Research Society (UK)
(www.marketresearch.org.uk)
MRSA: The Market Research Society of
Australia (www.mrsa.com.au)
PMRS: The Professional Marketing Research Society
(Canada) (www.pmrs-aprm.com)

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 Overview of Ethical Issues in Marketing Research

Table 1.3
I Problem definition
- Using surveys as a guide for selling or fundraising
- Personal agendas of the researcher or client
- Conducting unnecessary research

II Developing an approach
- Using findings and models developed for specific
clients or projects for other projects
- Soliciting proposals to gain research expertise
without pay
- Inaccurate reporting

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 Overview of Ethical Issues in Marketing Research (Cont.)
Table 1.3 cont.

III Research Design

- Formulating a research design more suited to the researcher's
rather than the client's needs
- Using secondary data that are not applicable or have been
gathered through questionable means
- Disguising the purpose of the research
- Soliciting unfair concessions from the researcher
- Not maintaining anonymity of respondents
- Disrespecting privacy of respondents
- Misleading respondents
- Disguising observation of respondents
- Embarrassing or putting stress on respondents
- Using measurement scales of questionable reliability & validity
- Designing overly long/sensitive questionnaires
- Using inappropriate sampling procedures and sample size
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 Overview of Ethical Issues in Marketing Research

Table 1.3 cont.

IV Field Work
- Increasing discomfort level of respondents
- Following unacceptable field work procedures

V Data Preparation and Analysis

- Identifying and discarding unsatisfactory respondents
- Using statistical techniques when the underlying
assumptions are violated
- Interpreting the results and making incorrect
conclusions and recommendations

VI Report Preparation and Presentation

- Incomplete reporting
- Biased reporting
- Inaccurate reporting
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