Essentials of Marketing Research PDF

Because learning changes everything. ® Essentials of Marketing Research Part 1: The Role and Value of Marketing Research Information Chapter 1: Marketing Research for Managerial Decision Making...

Because learning changes everything. ® Essentials of Marketing Research Part 1: The Role and Value of Marketing Research Information Chapter 1: Marketing Research for Managerial Decision Making © McGraw-Hill Education. All rights reserved. Authorized only for instructor use in the classroom. No reproduction or further distribution permitted without the prior written consent of McGraw-Hill Education.  The Growing Complexity of Marketing Research Databases or data warehouses store big data. Many companies use a customer relationship management (CRM) system to manage important customer information. Along with established tools and traditional data collection methods, digital advances provide new data collection opportunities. Companies increasingly choose hybrid research techniques with multiple methods to overcome weaknesses in using one methodology. Marketing research Marketing research tasks include: is the function that Designing methods for collecting information. links an organization Managing the information collection process. to its market through the gathering of Analyzing and interpreting results. information. Communicating findings to decision makers. © McGraw-Hill Education 2  The Role and Value of Marketing Research Managerial decisions may involve new contexts where experience may be absent or even misleading. Marketing research draws on the social sciences for methods and theory. Recently, the size of the toolbox has grown with “big data.” Marketers first must understand the questions or business problems that need to be addressed, then use the appropriate tool and technique. Marketing research applies to problems involving the four Ps. Theoretical research helps marketers understand questions applicable to a broad variety of marketing contexts. © McGraw-Hill Education 3  Marketing Mix Variables – Product New product development Branding. and introduction. Even established brands undertake Concept and product research for early detection of changes testing or test marketing in meaning and attitudes toward a brand. answers two questions. Positioning. How does a product A process of understanding how current perform for the or possible products are perceived by customer? consumers. How can a product Perceptual mapping fixes the position be improved or of products on two or more dimensions exceed customer impacting consumers’ choice to expectations? purchase. © McGraw-Hill Education 4  Exhibit 1.1: Perceptual Map of the Fast Food Market Access the text alternative for this image. © McGraw-Hill Education 5  Marketing Mix Variables – Place/Distribution Market research peculiar to retailers include: trade area analysis, store image studies, in-store traffic patterns, and location analysis. Much retailing research focuses on database development through optical scanning at the point of purchase. Online retailers face unique challenges and data-gathering opportunities. In behavioral targeting, online retailers work with content sites to display ads based on data collected about user behaviors. Shopper marketing gives manufacturers and retailers an understanding of a customer’s purchase journey and addresses the following: Product category management. Displays, sales, packaging, promotion, and marketing. © McGraw-Hill Education 6  Marketing Mix Variables – Promotion It is essential that companies know how to obtain good returns from their promotional budgets. The three most common research Traditional and digital media tasks in integrated marketing present special challenges to communications are: businesses who require Advertising effectiveness reliable metrics to accurately studies. gauge advertising return. Attitudinal research. Market researchers must develop meaningful metrics Sales tracking. and then collect the data for those metrics. © McGraw-Hill Education 7  Marketing Mix Variables – Price Pricing decisions involve pricing new products, establishing price levels in test marketing, and modifying prices for existing products. Marketing research provides answers to the following questions. How large is the demand potential within the target market at various price levels? What are the sales forecasts at various price levels? How sensitive is demand to changes in price levels? Are there identifiable segments that have different price sensitivities? Are there opportunities to offer different price lines for different target markets? © McGraw-Hill Education 8  Consumers and Markets – Segmentation Studies Marketing decisions involving all four Ps are more successful when target market demographics, attitudes, and While useful, more detailed lifestyles are clear. information may be needed. A major component of market Ethnography requires segmentation research is benefit and extended observation of lifestyle studies examining consumers’ consumers in context. needs. It highlights problems The objective is to collect customer and opportunities characteristics, product benefits, and based on consumer brand preferences. behavior. Combined with other demographics, it provides segmentation profiles. © McGraw-Hill Education 9  Marketing Theory The purpose of theory is to generalize relationships between concepts in a way applicable to a wide variety of business, and other settings. Adoption and diffusion theory helps marketers understand how new products are adopted and spread through the market. In services marketing research, marketers found five characteristics important to consumers – reliability, empathy, responsiveness, assurance, and tangibles. Information overload theory explains why consumers are more likely to purchase from a sample of 6 versus 24. In sales research, likability, similarity, and trustworthiness are characteristics linked to a salespersons’ success. © McGraw-Hill Education 10  The Marketing Research Industry This industry has experienced record growth in recent years, due to: Post-sale customer satisfaction studies – a third of research company revenues. Retail-driven product scanning systems – also a third of revenues. Database development for long-term brand management. International research studies. © McGraw-Hill Education 11  Types of Marketing Research Firms Internal or external - a unit within the company, or hiring a firm on a fee basis. Custom or standardized. Customized research firms provide tailored services to the client, while standardized research firms provide general services. Many standardized research firms provide syndicated business services. Brokers/facilitators. A prime example is the AC Nielsen database tracking the retail sales of thousands of brand-name products. © McGraw-Hill Education 12  Changing Skills for a Changing Industry As marketing research firms expand their geographic scope, it Top five skills candidates need for will require a unique skill base that open marketing positions today: is more comprehensive than ever. The ability to understand and These business skills are interpret secondary data. considered critical in job aptitude: Presentation skills. Communication skills – verbal Foreign language competency. and written. Negotiation skills. Interpersonal skills – ability to Information technology work with others. proficiency. Statistical skills. © McGraw-Hill Education 13  Ethical Questions in General Business Practices Pricing issues. “Soft” costs are used to pad the total project cost. Selling nonessential services is unethical. Client confidentiality issues. When firms specialize, it is tempting to reuse research results from one client to another. Use of “black-box” methodologies. Research firms sell branded “black-box” methodologies. Methodologies are called black-box when they are proprietary, and research firms will not fully disclose how the methodology works. A methodology is not a black-box just because it is branded. © McGraw-Hill Education 14  Conducting Research Not Up To Professional Standards Due to client pressure, research providers may conduct research that does not meet professional standards. Another client pressure is to prove a predetermined conclusion. The client may not provide a sufficient budget, leading to cost cuts. Interviewers working for research firms may engage in unethical behavior. Curbstoning occurs when interviewers complete interviews themselves or make up “observed” respondents’ behaviors. Other data falsification includes: Having friends and relatives fill out surveys. Not using the designated sample of respondents but rather anyone who is conveniently available. Not following up on the established callback procedures. © McGraw-Hill Education 15  Abuse of Respondents Research firms may neglect The Marketing Research promised incentives, they may Association provides guidelines. misrepresent time needed to They prohibit researchers from complete the survey, they may deanonymizing data. use fake sponsors. It is possible to “deanonymize” If deception is necessary, information on the Internet by “debrief” subjects afterwards. combining publicly available Research used for the purpose of records from social networks. collecting names is completely As with other public behavior, unethical online actions may be Sugging or frugging. observed but any identifying Market researchers should not information must be removed invade customer privacy. from the data file. © McGraw-Hill Education 16  Unethical Activities of the Client/Research User “Clients” may request research proposals from several companies with no intention of hiring any of them. Instead using the information obtained to perform the research themselves. Another common behavior is to promise a research provider a long-term relationship or additional projects to obtain a low price. Then providing no further business to the research firm. Clients may also be tempted to overstate results of a marketing research project. © McGraw-Hill Education 17  Unethical Activities by the Respondent The primary unethical practice is If there is the prospect of earning to provide dishonest answers or money by participating in research fake behavior. surveys and focus groups – Respondents frequently respondents lie to match the provide untrue answers to characteristics the screeners are questions related to income or seeking. to their indulgence in sensitive This undermines the validity of behaviors. the research. © McGraw-Hill Education 18  Marketing Research Codes of Ethics The Statement of Ethics for the American Marketing Association says: Researchers will conform to all relevant laws. Researchers will behave ethically. Use special care when conducting research among children. Respondents’ cooperation is voluntary. Rights of respondents as private individuals is respected. Never allow personal data to be used for any other purpose. Ensure projects are accurate, transparent, objective, and appropriate. Researchers will conform to principles of fair competition. © McGraw-Hill Education 19  Emerging Trends Five major trends are becoming evident. Increased emphasis on secondary data collection methods. Movement toward technology-related data management. Expanded use of digital technology for information acquisition and retrieval. A broader international client base. Movement beyond data analysis toward a data interpretation / information management environment. © McGraw-Hill Education 20 Because learning changes everything. ® www.mheducation.com © McGraw-Hill Education. All rights reserved. Authorized only for instructor use in the classroom. No reproduction or further distribution permitted without the prior written consent of McGraw-Hill Education.