Marketing Research Process and Proposals PDF

Because learning changes everything. ® Chapter 02 The Marketing Research Process and Proposals ESSENTIALS of MARKETING RESEARCH Sixth Edition Joseph F. Hair, Jr. , David J. Ortinau, Dana E. Harr...

Because learning changes everything. ® Chapter 02 The Marketing Research Process and Proposals ESSENTIALS of MARKETING RESEARCH Sixth Edition Joseph F. Hair, Jr. , David J. Ortinau, Dana E. Harrison © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.  Value of the Research Process Business owners and managers often identify problems they need help to solve. Additional information is often needed. One solution is a marketing research study based on a scientific research process. © McGraw Hill, LLC 2  Changing View of the Marketing Research Process The most influential factor is the internet and big data. Secondary data are previously collected for some other problem. Primary data are collected specifically for a current problem. Big data are unstructured secondary data stored in Advances data in warehouses. Marketing research is being gatekeeper repositioned to play a role in technologies will strategy development. continue to challenge marketers. The information research process collects, analyzes, Global expansion interprets, and transforms data introduces new sets into decision-making of cultural issues. © McGraw Hill, LLC information. 3  Determining the Need for Information Research Situations when Can the problem be resolved research may not be using existing information and necessary. managerial judgment? Insufficient time Is information available in frames. internal record systems to Inadequate address the problem? resources. Is there time to conduct the Costs outweigh the necessary research? value. Do the benefits outweigh the costs? Will the research provide useful feedback for decision making? Will the research give © McGraw Hill, LLC 4  DEBATE: To research or Not to research Team A: Pro – research Team B: Against – research 10 – 15 minutes to discuss and prepare arguments Structure of the debate as follows:  Opening statements (2 minutes per team)  Main arguments (5 minutes per team)  Rebuttal (3 minutes per team)  Closing statements (2 minutes per team)  How might the decision impact Coffee Bliss's future?  What are the risks and benefits of each approach?  How do the factors mentioned in the slide (time, resources, costs vs. benefits, existing information) apply to this scenario? © McGraw Hill, LLC 5  Coffee Bliss Expansion Dilemma Coffee Bliss, a successful local coffee shop chain with 5 locations in Boston, is considering expanding to a new neighborhood. The CEO is torn between two options: 1. Open a new location in the trendy Seaport District. 2. Launch a mobile coffee truck service to cover various areas of the city. The company has $500,000 set aside for this expansion. They have basic foot traffic data for the Seaport District and general information about the food truck industry in Boston. The marketing team suggests conducting comprehensive market research to determine the best option. This would cost $50,000 and take 2 months to complete. However, it would delay the expansion plans, and a competitor might enter the market during this time. The CEO needs to decide: Should they invest time and money in market research, or make a decision based on existing information and intuition? © McGraw Hill, LLC 6  Overview of the Research Process The research process Examine measurement consists of these 11 issues and scales. steps. Design and pretest the Identify and clarify questionnaire. information needs. Collect and prepare Define the research data. questions. Analyze data. Specify research Interpret data to create objectives and confirm knowledge. information value. Prepare and present Determine the the final report. research design and The steps are guided by data sources. the scientific method. Develop the sampling © McGraw Hill, LLC 7  The Research Process Transforming data into knowledge. The primary goal of the research process is to provide decision makers with knowledge to resolve problems or pursue opportunities. Data become knowledge when someone interprets the data and attaches meaning. Factors in how many steps are taken and in what order. The complexity of the problem. The urgency for solving the problem. The cost of alternative approaches. The clarification of information needs. © McGraw Hill, LLC 8  Determine the Research Problem: Step 1— Identify and Clarify Information Needs Agree on the decision maker’s purpose for the research. Iceberg principle—decision makers know 10% of the true problem. Understand the complete problem situation. A situation analysis uncovers the problem’s complexity. Identify measurable symptoms. Clarify the problem—separate out causes and symptoms. Select the unit of analysis. This provides direction in later activities. Determine the relevant variables. © McGraw Hill, LLC 9  Exhibit 2.4: The Iceberg Principle Access the text alternative for these images © McGraw Hill, LLC 10  Exhibit 2.5: Examples of Variables/Constructs Investigated in Marketing Variables/ Description Constructs Brand Percentage of respondents having heard of a Awareness designated brand; awareness could be either unaided or aided. Brand Attitudes The number of respondents and their intensity of feeling positive or negative toward a specific brand. Satisfaction How people evaluate their postpurchase consumption experience with a particular product, service, or company. Purchase The number of people planning to buy a specified Intention object (e.g., product or service) within a designated time period. Importance of To what extent do specific factors influence a Factors person’s purchase choice. Demographics The age, gender, occupation, income level, and other characteristics of individuals providing the information. © McGraw Hill, LLC 11  Determine the Research Problem: Step 2— Define the Research Questions Redefine the initial problem as a research question. The researcher conducts a review of the literature. This step is important as it influences the remaining steps. Variables to questions: how, what, where, when, or why. Next, determine the types of data that will best answer each Finally, determine question. whether the Does the question require new information being data? requested is necessary. Consider other issues such as data availability, data quality, and budget or time © McGraw Hill, LLC 12  Exhibit 2.6: Initial and Redefined Research Questions for Lowe’s Home Improvement Inc. Initial research question Do our marketing strategies need to be modified to increase satisfaction among our current and future customer segments? Redefined research questions What store/operation aspects do people believe are important in selecting a retail hardware/lumber outlet? How do customers evaluate Lowe’s retail outlets on store/operation aspects? What are the perceived strengths and weaknesses of Lowe’s retail operations? How do customers and noncustomers compare Lowe’s to other retail hardware/lumber outlets within the Atlanta metropolitan area? What is the demographic/psychographic profile of the people who patronize Lowe’s retail outlets in the Atlanta market? © McGraw Hill, LLC 13  Determine the Research Problem: Step 3— Specify Objectives and Confirm Information Value Research objectives should be based on questions in Step 2. Research objectives provide guidelines for determining other steps. Assumption: If the objectives are achieved, the decision The decision maker will maker and have the researcherneeded information use “best judgment” to answer the answers to these research questions: questions. Can the information be collected at all? Can the information tell the decision maker something not already known? Will the information provide significant insights? What benefits will be delivered by this information? © McGraw Hill, LLC 14  Select the Research Design: Step 4—Determine the Research Design and Data Sources Exploratory research has one of two objectives. Generating insights that help define the problem situation. Understanding consumer motivations, attitudes, and behaviors. Descriptive research collects quantitative data. Image assessment surveys or customer satisfaction surveys. Predictive research compares two or more variables. Used to understand how one variable impacts a dependent variable. The sources used depend on two fundamental issues. © McGraw Hill, LLC 15  Select the Research Design: Step 5—Develop the Sampling Design and Sample Size Researchers need to identify the relevant target population. In a census, the researcher attempts to question or observe all the members of a defined target population. For large populations, use a representative sample and generalize. A sampling plan is one of two general types. Probability: each member of the target population has a known chance of being selected—allows assessment of sampling error. Nonprobability: cannot measure sampling error, © McGraw Hill, LLC 16  Select the Research Design: Step 6—Examine Measurement Issues and Scales Step 6 involves identifying the concepts to study and measuring the variables related to the research problem. For example, when analyzing sales results, it is impossible to provide daily sales information if sales are only captured on a weekly basis. Researchers must be able to answer Although Step 6 is questions such as: mostly related to How should a variable such as primary research, understanding these customer satisfaction or service activities is quality be defined and measured? important in Should researchers use single- or secondary research multi-item measures to quantify as well. variables? © McGraw Hill, LLC 17  Select the Research Design: Step 7—Design and Pretest the Questionnaire Researchers must: Pretest respondents are Select the correct type asked about these issues: of questions. Clarity of instructions Consider the sequence and questions. and format. Sequence of the topics Pretest the and questions. questionnaire. Anything potentially difficult or confusing. © McGraw Hill, LLC 18  Execute the Research Design: Step 8—Collect and Prepare Data Two approaches to gathering data are: Using interviewers or self-completion questionnaires. Observing individuals or market phenomena. A major advantage of questioning over observation: Questioning answers not just how a person is behaving, but why. Before analysis, researchers must: Transfer responses into an electronic This is also necessary when data file. information is used Examine the data for coding, data-entry from internal data errors, inconsistencies, availability, and warehouses. so on. © McGraw Hill, LLC 19  Execute the Research Design: Step 9—Analyze Data Analysis procedures vary. Different procedures From simple frequency enable the researcher to: distributions— Test hypotheses for percentages. variable differences or To summary statistics correlations. —mean, median, and Evaluate data quality. mode. Test models of cause– Or multivariate data effect relationships. analysis. Or advanced analytics techniques—natural language process and machine learning. © McGraw Hill, LLC 20  Execute the Research Design: Step 10— Interpret Data to Create Knowledge Interpretation is more than a narrative of results. It integrates the aspects of the findings into conclusions used to answer the research questions. Knowledge is Visualization tools pair data created through analytics results with engaged and computer graphics. careful An efficient way to explain interpretation of insights. results. © McGraw Hill, LLC 21  Communicate the Results: Step 11—Prepare and Present the Final Report Sections included in any research report are as follows: Executive summary. Introduction. Problem definition and objectives. Methodology. Results and findings. Limitations of the study. Sometimes, both a written report and an oral presentation are provided. © McGraw Hill, LLC 22  Develop a Research Proposal A research proposal communicates the research framework to the decision maker. The proposal is not the same as a final research report. Most research proposals include the following Purpose of the proposed Potential managerial sections. research project. benefits of the proposed Type of study. study. Definition of the target Proposed cost for the total population and sample size. project. Sample design and data Profile of the research collection method. company capabilities. Specific research Optional dummy tables of instruments. the projected results. © McGraw Hill, LLC 23  Each group is a "company" launching a new product (e.g., a smart water bottle that tracks hydration). Groups work through 1.Identify needs: What do you need to know before launching? each step of the research 2.Define questions: What specific questions process for their product will guide your research? launch 3.Specify objectives: What are your research goals? 4.Research design: How will you collect data? 5.Sampling: Who will you study and how many? 6.Measurement: What scales or metrics will you use? 7.Questionnaire: What key questions will you ask consumers? 8.Data collection: How will you gather the information? 9.Analysis: How will you make sense of the data? 10.Interpretation: What insights can you draw? © McGraw Hill, LLC 24  Chapter 03 Secondary Data, Literature Reviews, and Hypotheses ESSENTIALS of MARKETING RESEARCH Sixth Edition Joseph F. Hair, Jr. , David J. Ortinau, Dana E. Harrison © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC. © McGraw Hill, LLC  Value of Secondary Data and Literature Reviews Secondary data are data gathered for some other purpose. Internal secondary data are collected for various reasons. Traditionally, secondary data had limited value but External secondary data are collected by have gained substantial importance in marketing outside organizations. research. Retailers collect external secondary data from hundreds of sources. The role of secondary research analyst is being redefined. To someone who creates databases, prepares competitive trend reports, develops customer © McGraw Hill, LLC 26  Conducting a Literature Review A literature review is a comprehensive examination of available secondary information related to the research topic. Even if primary research is planned, a literature review: Provides background and contextual information for the current study. Reveals whether information already exists addressing the issue. Helps to define important constructs of interest to the study. Helps researchers stay abreast of the latest thinking on the topic. Can suggest research hypotheses to investigate. © McGraw Hill, LLC 27  Evaluating Secondary Data Sources Researchers have criteria to evaluate secondary data. Purpose—carefully evaluate data on how it relates to the current research objective. Accuracy—is it from the original source or out of date? Consistency—seek multiple sources of the same data. Credibility—always question the credibility of secondary data. Methodology—flaws result in invalid, unreliable, or data not generalizable beyond the original study. © McGraw Hill, LLC 28  Secondary Data and the Marketing Research Process Sometimes, Demographic—population growth, secondary density, trends. data by Employment—unemployment levels or by itself can industry. address the Economic—income, businesses, housing, research sales tax. problem. Competitive—sales, number/type of Here is a competitors. list of Supply—facilities, cost of delivers, road secondary conditions. data Regulations—taxes, licensing, wages, sources zoning. and a few International—trade barriers, of their social/political climate. variables. © McGraw Hill, LLC Weather—patterns and major weather 29  Internal Sources of Secondary Data Internal data are the most readily available and can be accessed at little or no cost. Generally, internal secondary data are sales, accounting, or cost data. Commonly, invoices, sales, social media, and customer service reports. If maintained and categorized properly, internal data can be used to analyze: Product performance. Customer satisfaction. Distribution effectiveness. Segmentation strategies. © McGraw Hill, LLC 30  External Sources of Secondary Data Popular sources. Online newspaper and journal articles. Scholarly sources. Google Scholar or library gateway. Government sources. Census data, additional government reports, and publication catalog. North American Industry Classification System (NAICS). Uniform data reporting by government and private business. © McGraw Hill, LLC 31  External Sources of Secondary Data: Commercial Sources—Syndicated Data Syndicated data—research collected, packaged, and sold. Suppliers traditionally used consumer panels and store audits, but in recent years optical-scanner Consumer panels are large technology increased as a third method. samples that provide data for an extended time. Store audits are formal Low cost, timely, accurate, and examinations of specific. how a product or Two types: purchases and media brand sold at the habits. retail level. Media panels are similar and Precise, measure media consumption timely. © McGraw Hill, LLC 32 Developing a Conceptual Model Variables, Constructs, and Relationships A variable is an observable item used as a measure on a questionnaire. Variables have concrete properties and are measured directly. In contrast, a construct is an unobservable, abstract concept measured indirectly by a group of related variables. Relationships are associations between two or more variables. Service quality, value, customer satisfaction,Aand brand literature attitude. Independent variables predict or review will help explain the outcome variable. identify, define, and measure Dependent variables are the constructs. variables or constructs the researchers seeks to explain. © McGraw Hill, LLC 33  Developing Hypotheses and Drawing Conceptual Models Descriptive hypotheses address specific problems. Causal hypotheses—theoretical relationships between variables. Hypotheses can suggest positive or negative relationships. Positive relationship—two variables increase or decrease together. Negative relationship—one Conceptualization variablespecifies identifies variables, increases, another decreases. hypotheses and relationships, and prepares a diagram. Conceptual models become theoretical models when the literature review/exploratory research is sufficient to support the model. A section of your literature review is dedicated to presenting your model, called a conceptual framework. © McGraw Hill, LLC 34  Exhibit 3.8: A Model of New Technology Adoption Access the text alternative for these images © McGraw Hill, LLC 35  Hypothesis Testing A hypothesis is a testable but unproven statement to explain a phenomenon—it suggests relationships between variables. The null hypothesis states there is no relationship. The alternative hypothesis states there is a relationship. A null hypothesis refers to a population parameter. The parameter is the actual value of a variable. The sample statistic is an estimate of the population parameter. Failure to reject the null hypothesis does not mean it is true. Null hypothesis is notated as H0 and the alternative as © McGraw Hill, LLC 36