Principles Of Marketing Chapter 4 PDF

Principles of Marketing Chapter 4 Managing Marketing Information to Gain Customer Insights Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved. Learning Objectives 4-1 Explain the importance of information in gaining insights about the...

Principles of Marketing Chapter 4 Managing Marketing Information to Gain Customer Insights Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved. Learning Objectives 4-1 Explain the importance of information in gaining insights about the marketplace and customers. 4-2 Define the marketing information system and discuss its parts. 4-3 Outline the steps in the marketing research process. 4-4 Explain how companies analyze and use marketing information. 4-5 Discuss the special issues some marketing researchers face, including public policy and ethics issues. Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved. Learning Objective 1 Explain the importance of information in gaining insights about the marketplace and customers. Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved. Marketing Information and Customer Insights To create value for customers and build Marketing information by itself has little meaningful relationships with them, value. The value is in the customer marketers must first gain fresh, deep insights gained from the information and insights into what customers need and how marketers use these insights to make want better decisions Customer insights are fresh marketing To gain good customer insights, marketers information-based understandings of must effectively manage marketing customers and the marketplace that information from a wide range of sources become the basis for creating customer value, engagement, and relationships However, these insights can be very difficult to obtain Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved. Learning Objective 2 Define the marketing information system and discuss its parts. Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved. Assessing Marketing Information Needs Companies must design effective marketing information systems that give managers the right information, in the right form, at the right time and help them to use this information to create customer value and stronger customer relationships A marketing information system (MIS) provides information to the company’s marketing and other managers and external partners such as suppliers, resellers, and marketing service agencies A good MIS balances the information users would like to have against what they really need and what is feasible to offer Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved. Marketing Information and Customer Insights 1 2 3 Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.  Developing Marketing Information Marketers obtain information from: INTERNAL MARKETING MARKETING DATABASES INTELLIGENCE RESEARCH Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.  Internal databases are Internal databases can be collections of consumer derived from: and market information Developing Information on Customer obtained from data Characteristics sources within the Marketing company network Sales Transactions Website Visits Information accessed more quickly and cheaply than other Customer Satisfaction and – Internal information sources Service Records Records of Sales, Costs and Often collected for other Databases purposes, so it may be incomplete or in the wrong Cash Flows Reports on Production, form Shipments and Inventories Challenge of keeping the Reports on Reseller Reactions and Competitor database requires special Activities effort, equipment, and techniques Point-of-Sale Transaction Data Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.  Developing Marketing Information – Internal Databases Common drawbacks of internal databases: Inaccuracy: Internal Limited data: contains Biased data: if a data is often entered data from customers business's internal manually by Cost: Collecting and who have already database contains data employees, which can maintaining internal interacted with the from more loyal lead to errors. data can be business. Businesses customers, the costly, especially for may not get a complete feedback may be more Customer data may not small businesses - need picture of their positive than if the be updated to invest in customer base or their business had collected regularly, which can hardware, software, and needs and preferences feedback from a more make it inaccurate over personnel to manage if they rely solely on representative sample time. Eg: outdated their data internal data of customers address, marital status, etc Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved. Internal Databases –Information on Customer Characteristics Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.  Developing Marketing Information- Competitive Marketing Intelligence Competitive marketing The goal is to improve intelligence is the systematic strategic decision-making by collection and analysis of understanding the consumer The growing use of marketing publicly available information environment, assessing and intelligence raises a number about consumers, tracking competitors’ actions, of ethical issues competitors, and and providing early warnings developments in the of opportunities and threats marketing environment Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.  Developing Marketing Information - Competitive Marketing Intelligence Quizzing the Observing consumers Monitoring Researching the Monitoring Internet company’s own firsthand competitors’ activities Internet buzz employees send out teams of Collected from actively monitor trained observers to people inside the competitors’ activities Using Internet search Social media make it mix & mingle with company— through their annual engines, marketers easier than ever for customers (talk about executives, reports, business can search specific people to share—to the company’s engineers, scientists, publications, trade competitor names, have conversations products purchasing agents, show exhibits, press events, or trends and and express their routinely monitor the sales force, etc. releases, see what turns up opinions, needs, consumers’ online advertisements, & Tracking consumer ideas, and chatter (marketing Web pages conversations about complaints research companies) competing brands are often as revealing as tracking conversations about the company’s own brands Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved. Learning Objective 3 Outline the steps in the marketing research process. Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved. Marketing Research Marketing research is the systematic design, collection, analysis, and reporting of data relevant to a specific marketing situation facing an organisation Marketing research enables marketers to: gain insights into customer motivations, purchase behaviour, and satisfaction assess market potential and market share measure the effectiveness of pricing, product, distribution, and promotion activities Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved. The Marketing Research Process Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved. The Marketing Research Process Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.  Steps in Marketing Research: 1) Defining the Problem and Research Objectives This initial step involves identifying the marketing issue or opportunity marketers trying to address. What information do marketers need to make better decisions? 3 types of research objectives: - Exploratory - Descriptive - Causal Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.  Steps in Marketing Research: 2. Developing the Research Plan Outline the methods to use in collecting data to answer research questions This includes deciding on the research design, data collection methods (surveys, interviews, etc.), and sampling approach Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved. Steps in Marketing Research: 2. Developing the Research Plan (Cont…) The research plan should be presented in a written proposal especially when the research project is a large-scale/complex Management problem Research objectives Written Proposal Information needed includes: How the results will help management decisions Budget Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved. Steps in Marketing Research: 2. Developing the Research Plan (Cont…) To meet the manager's information needs, the research plan may involve Primary Secondary gathering secondary data, primary data, or both. Gathering Data Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.  Primary Secondary Steps in Marketing Research: 2. Developing the Research Plan (Cont…) Gathering Data Secondary data Eg: Internal Advantages Disadvantages information that databases, Lower cost Data may NOT be already exists Researchers government Obtained quickly Relevant somewhere, usually start by publications, having been gathering Accurate books, census, collected for secondary data Current internet search another purpose Impartial engines, etc Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.  Primary Secondary Steps in Marketing Research: 2. Developing the Research Plan (Cont…) Gathering Data Primary data Designing a plan for Secondary data primary data collection To gain comprehensive provides a good calls for a number of understanding, Primary data - starting point for decisions on research companies typically information collected research and often approaches, contact need to collect primary for the specific purpose helps to define methods, the sampling data in addition to at hand research problems and plan, and research secondary data objectives instruments (refer Table 4.1) Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.  Steps in Marketing Research: 2. Developing the Research Plan (Cont…) Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.  Steps in Marketing Research: 2. Developing the Research Plan (Cont…) Planning Primary Data Collection Survey Research Observational Research Experimental Ethnographic Research research Research Approaches Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.  Steps in Marketing Research: 2. Developing the Research Plan (Cont…) Planning Primary Data Collection Research Approaches Observational research involves gathering primary data by observing relevant people, actions, and situations. Eg: Evaluate possible new store locations by checking traffic patterns, neighbourhood conditions, and the location of competitors Ethnographic research involves sending trained observers to watch and interact with consumers in their “natural environments.” The observers might be trained anthropologists and psychologists or company researchers and managers Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.  Ethnographic research – consumers in their “natural environments Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved. Steps in Marketing Research: 2. Developing the Research Plan (Cont…) Planning Primary Data Collection Research Approaches Survey research (widely used) involves gathering primary data by asking people questions about their knowledge, attitudes, preferences, and buying behaviour Experimental research involves gathering primary data by selecting matched groups of subjects, giving them different treatments, controlling related factors, and checking for differences in group responses. The best suited for gathering causal information Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.  Steps in Marketing Research: 2. Developing the Research Plan (Cont…) Planning Primary Data Collection Contact Methods Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.  Mail Steps in Marketing questionnaires Research: 2. Developing the Research Plan (Cont…) Online marketing Contact Telephone methods interviewing research Planning Primary Data Collection Contact Methods Personal interviewing (individual or group) Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.  Steps in Marketing Research: 2. Developing the Research Plan (Cont…) Planning Primary Data Collection Contact Methods: Mail Questionnaires Advantages: Disadvantages: Collect large amounts of Not flexible - all respondents Collect data from respondents information at a low cost answer the same questions by sending them a physical Respondents may give more in a fixed order questionnaire through the honest answers than to an Longer to complete with a postal mail unknown interviewer in lower response rate person or over the phone No interviewer is involved in biasing respondents’ answers Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.  Steps in Marketing Research: 2. Developing the Research Plan (Cont…) Planning Primary Data Collection Contact Methods: Telephone interviewing Telephone interviewing Advantages Disadvantages collecting primary data Quicker response and Higher cost than mail through phone calls more flexible than mail questionnaires with participants in questionnaires Potential interviewer your target audience Interviewers can bias explain difficult questions Higher response rates than mail questionnaires Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.  Steps in Marketing Research: 2. Developing the Research Plan (Cont…) Planning Primary Data Collection Contact Methods: Personal interviewing Group (focus Individual group) Personal interviewing Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.  Steps in Marketing Personal Interviewing: Individual Research: 2. Developing the Involves talking with people at Research Plan home or the office, on the street, (Cont…) or in shopping malls Flexible Planning Primary Data Trained interviewers can guide Collection interviews, explain difficult questions, and explore issues as Contact Methods: the situation requires Personal More expensive than telephone interviewing interviews Copyright © 2018, 2016, 2014 Pearson Education,4-25 Inc. All Rights Reserved.  Steps in Marketing Personal Interviewing: Focus Group Research: Focus group interviewing consists of inviting 2. Developing the six to ten people to meet with a trained Research Plan moderator to talk about a product, service, (Cont…) or organization Participants normally are paid a small sum Planning Primary Data for attending Collection A moderator encourages free and easy discussion, hoping that group interactions will Contact Methods: bring out actual feelings and thoughts. At the Personal same time, the moderator “focuses” the interviewing discussion, hence the name focus group interviewing 4-25 Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.  Steps in Marketing Personal Interviewing: Focus Group Research: 2. Developing the Challenges: Research Plan It is expensive due to the typical set-up (6- (Cont…) 10 respondents) and moderator fees Planning Primary Data Small samples to keep time and costs Collection down, and it may be hard to generalise from the results Contact Methods: Consumers in focus groups are not always Personal open and honest about their real feelings, interviewing behaviour, and intentions in front of other people (peer-pressure) Copyright © 2018, 2016, 2014 Pearson Education,4-25 Inc. All Rights Reserved.  Steps in Marketing Research: 2. Developing the Research Plan (Cont…) Planning Primary Data Collection Contact Methods: Online Online Advantages Disadvantages The growth of the Internet Low cost Hard to control who’s in the has had a dramatic impact on Speed to administer sample the conduct of marketing Fast results Lack of interaction research. Increasingly, Good for hard-to-reach Privacy concerns researchers are collecting groups primary data through online marketing research such as: Internet surveys Online panels Online experiments Online focus groups Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.  Steps in Marketing Research: 2. Developing the Research Plan (Cont…) Planning Primary Data Collection Contact Methods Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.  Steps in Marketing Research: 2. Developing the Research Plan (Cont…) Planning Primary Data Collection Sampling plan Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.  Steps in Marketing Research: 2. Developing the Research Plan (Cont…) Planning Primary Data Collection Sampling plan A sample is a segment of the population selected for marketing research to represent the population as a whole Who is to be studied? How many people should be studied? How should the people be chosen? Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.  Steps in Marketing Research: 2. Developing the Research Plan (Cont…) Planning Primary Data Collection Sampling plan Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.  Steps in Marketing Research: 2. Developing the Research Plan (Cont…) Planning Primary Data Collection Sampling plan Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.  Steps in Marketing Research: 2. Developing the Research Plan (Cont…) Planning Primary Data Collection Sampling plan Research Instruments-Questionnaires Most common, can be conducted in person, by phone, or online Researchers must be careful with the wording and order of questions Questionnaires are very flexible—there are many ways to ask questions Closed-ended – Closed-ended questions include all the possible answers, and respondents make choices among them. Examples include multiple-choice questions and scale questions Open-ended – Open-ended questions allow respondents to answer in their own words. Useful in exploratory research, when the researcher is trying to find out what people think but is not measuring how many people think in a certain way Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved. Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.  Steps in Marketing Research: 3. Implementing the research plan Sampling plan Likert Scale Types of Rating Scales Dichotomous Scale Net Promoter Score Semantic Differential Scale Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved. Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.  Mechanical Research Instruments Steps in Mechanical devices Marketing Although questionnaires are the most common research Research: instrument, researchers also can use the following: 3. Implementing People meters Checkout Biometric Neuro- the research scanners measures Marketing - plan Eg: Satellite Eg: Bar-code measuring systems – to Eg: How many brain activity to scanners to learn how record who commercial Sampling plan watches which record shoppers'’ viewers skip consumers feel programmes etc and respond purchases Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.  Steps in Marketing Research: 3. Implementing the Research Plan Collecting the information Processing the information Analyzing the information 4. Interpreting and Reporting Findings Interpret findings Draw conclusions Report to management Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved. Learning Objective 4 Discuss the special issues some marketing researchers face, including public policy and ethics issues. Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.  Marketing Research in Small Businesses and Nonprofit Organizations Other Marketing International Market Information Research Considerations Customer Public Policy privacy Misuse of and Ethics research findings Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved. Copyright Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.