Chapter 5 - Summary Mktg - Mktg PDF

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Chapter 5: Marketing Research Marketing Research: is about gathering information about customers, their needs, and the marketplace in which they operate. Not to reinforce a belief but to better understand connections between marketing actions and customer needs. 3 functional roles marketing research plays in an org: 1. Descriptive role - present factual statements Ex. What are historic sales trends in the industry? What are consumers’ attitudes toward a product and its advertising? 2. Diagnostic role - explaining relationships w/in data Ex. What is the impact on a product’s sales if the colour of the packaging is changed? 3. Predictive role - predicting results of a marketing decision (what if?) Ex. What is the impact of a new product introduction on market share? American Marketing Association has defined marketing research for the past decade as: “Marketing Research is the function that links the consumer, customer and public to the marketer through information - information used to identify and define marketing opportunities and problems; generate, refine and evaluate marketing actions; monitor marketing performance; and improve understanding of marketing as a process.” 5-2 Marketing Research Process A scientific approach to decision making that maximizes the chance of receiving accurate and meaningful results, follows a 6 step process: 1. Identify Problem Management Decision - what should be done about a restaurant’s low sales? Research Problem - What factors go into a customer’s decision to dine at a particular restaurant? Marketing Research Objective - specific statement about the information needed to solve the research question Common question (how customer chooses restaurant): What is the demographic profile of the restaurant’s patrons? What external factors (time, expense) are influencing the public’s willingness to dine out? How important is branding to diners in the restaurant industry? 2. Design the Research Research Design - specifies how to go about answering the questions and achieving the objectives Types of research design: Exploratory Research - informal discovery process, attempts to gain insight and understanding of the management and research problems (Patterns and relations but no targeting) Conclusive Research - more specific, attempts to provide clarity to a decision maker by identifying specific courses of action (Qualitative research and more specific targeting) Descriptive Research - attempts to describe marketing phenomenons and characteristics

Casual Research - focuses on the cause and effect of two variables and attempts to find some correlation between them

3. Collect the Data Secondary Data - already been collected by another entity, was collected for another purpose (E.g: StatsCan) 2 main sources of secondary data: 1. Sources inside the org conducting the research 2. External sources that are publicly available, sometimes at a price CON is that data was collected for another purpose/problem, not tailored towards your research question PROS are that it's cheaper and more time effective Primary Data - info collected for the first time and used for solving particular problem  Minimize biases and misinterpretations  Improve Validity (Accuracy) and Reliability (Consistency) of Measures CON is that it's expensive and time consuming PRO is that it’s specifically tailored research designed exactly for your needs Want to know the Pros and Cons of each of the following Methods  Interviews (Mall vs. Executive)  Focus Groups  Observation o Pro: Great insights  Ethnography o Pro: you would never get to these insights without this kind of commitment

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o  o o o 

Con: very expensive, very time consuming, difficult to categorize, (no numbers in qualitative) Survey Pro: really cheap, no open-ended questions (easy to record), requires low effort commitment, it’s fast, access to large samples, fairly in depth, correlations Cons: difficult to design well, low response rate, response bias, noncausal, social desirability Experiments Only method that allows you to show causality (?A causes B?) Pros: control, causality, experiments can be replicated Con: Difficult to design well, difficult to get representative sample, ecological validity, demand effects, social desirability, consistency bias Big Data

Types of primary data: Qualitative and Quantitative: differences go back to research design (3 types of design: exploratory, descriptive and causal) Qualitative data collection methods:  Depth Interviews - discussion between well trained researcher and respondent who’s asked about attitudes and perspectives on a topic  Focus Groups - small group of recruited participants engaged in a nonstructured discussion in a casual environment Quantitative data collection method:  Survey Research - most popular technique for collecting primary data, researcher interacts with people to obtain facts, opinions and attitudes  In-home personal interviews  Mall Intercept Interview - interviewing in common areas of shopping malls. Increasingly market researchers are using technology in this technique  Computer Assisted personal interviewing - interviewer reads question from screen and inputs respondents answer  Computer Assisted Self Interviewing - respondent reads question and inputs their answer  Central Location Telephone Interview (CLT) - specially designed phone room used for telephone interviewing Questionnaire Design:  Observation Research - relies on 4 types of observation: people watching people, people watching an activity, machines watching people and machines watching an activity  Mystery Shoppers - researchers posing as customers gathering observational data Ethnographic research - study of human behaviour in its natural context involves observation of behaviour and physical setting Experiment - method researcher uses to gather primary data to determine cause and effect, two types of experiment setting are laboratory and field

Specifying the Sampling Procedure:  Sample - subset from a larger population Probability Sample - sample in which every element in the population has a known statistical likelihood of being selected Random Sample - every element of population has equal chance of being sampled Nonprobability Sample - little or no attempt is made to have a representative cross section of the population Convenience Sample - form of nonprobability sample using respondents who are convenient Measurement Error - error that occurs when information desired by the researcher differs from the info given by the measurement process Types of Error:  Sampling Error - when sample doesn’t represent the target population  Frame Error - sample from drawn population that differs from target population  Random Error - selected sample is an imperfect representation of the overall population 4. Analyze Data (OUTSIDE THE SCOPE OF THIS COURSE! DO NOT NEED TO KNOW) Cross Tabulation - method of analyzing data that shows the analyst the responses to one question in relation to the responses to one or more other questions 5. Present Report Usually required to present written and oral reports, begin with clear concise statement of research issue studied, research objectives and a complete yet brief simple explanation of the research design or methodology employed including nature of sample collection. Conclusion should include recommendations to management as well as limitations. 6. Provide Follow up Internal researcher should keep track of and ask: “was sufficient decision making info included?” and “What could have been done to make the report more useful to management?” 5-3 The Impact of Technology on Marketing Research *”Technology is pervasive in our lives” a. Online Surveys: Huge growth in popularity is the result of many advantages:  Rapid Development, Real Time Reporting  Dramatically Reduced Costs  Improved Respondent Participation  Contact with the Difficult-to-Reach b) Online Research Panels c) Online Focus groups: almost like a questionnaire chat room d) Mobile Marketing Research e) Social Media Marketing Research f) Rise of Big Data: what facebook and twitter sell to companies/govt.

5-4 When to Conduct Marketing Research *”you don’t have to be a rocket scientist to admit you don’t know what your don’t know” Understand the problem is a key to determining what next steps are necessary Competitive Intelligence - Intel system that helps managers assess their competition and vendors in order to become more efficient and effective competitors

*Know the pros and cons of Simple random sample and convenience sample*...