Defining Marketing Research

1. Defining Marketing Research marketing research The process and methods used to gather information, analyze it, and report findings related to marketing goods and services. Marketing researchX involves the process and methods used to gather information, analyze it, and report findings related to marketing goods and services. Marketing research is most often used by companies to: Determine consumers’ attitudes and preferences Test product features Determine market size and growth potential Learn about competitive products Determine buying cycles Understand how the company is perceived by the public Marketing Essentials Chapter 28, Section 28.1

2. A great deal of time and money are spent on marketing research before a new product or service is launched, but marketing research continues throughout the life of a product or service It is essential for businesses to understand factors which affect the purchasing of their product or service. Why Is Marketing Research Important?

3. Why Is Marketing Research Important? The information obtained from research helps businesses increase sales and profits. Research answers questions about: What products to produce At what price to sell them Who will buy the products How the products will be promoted Research also helps solve marketing problems and gauge the potential of new ideas. Marketing Essentials Chapter 28, Section 28.1

4. Who Uses Marketing Research? Small businesses usually rely on their owners, managers, employees, or hired assistants to do their research. Larger companies have in-house research departments to plan and conduct studies. Trade associations conduct and use research. Nonprofit organizations use customer surveys to get feedback. Marketing Essentials Chapter 28, Section 28.1

5. Marketing Information Systems marketing information system A set of procedures and methods that regularly generates, stores, analyzes, and distributes information for use in making marketing and other business decisions. A marketing information systemX is a set of procedures and methods that regularly generates, stores, analyzes, and distributes information for use in making marketing and other business decisions. Marketing Essentials Chapter 28, Section 28.1

6. Marketing Information Systems Data that should be part of a marketing information system include: Customer profile data Company records Competitors’ records Government data Marketing research reports that are produced and sold by research firms Marketing Essentials Chapter 28, Section 28.1

7. Database Marketing database marketing A process of designing, creating, and managing customer lists that contain information about an individual’s characteristics and transactions with a business; also known as customer relationship management (CRM). database A collection of related information about a specific topic. Database marketingX, or customer relationship management (CRM), is the process of designing, creating, and managing customer lists. Once a list is developed, it can be used for locating, selecting, and targeting customers with special programs and services. A databaseX is a collection of related information about a specific topic. Information about consumers and their buying habits is stored in computer databases. Supermarket rewards cards are an example of database marketing. Marketing Essentials Chapter 28, Section 28.1

8. Supermarket rewards cards are an example of database marketing. Information collected – household demographics , lifestyle, purchase behavior. Did you know the supermarket was collecting this information when you signed up for the card? Does knowing your purchases are being tracked make you more or less likely to use the card? Database Marketing – Rewards Cards

9. Types of Marketing Research quantitative research A type of research that answers questions that start with “how many” or “how much.” qualitative research A type of research that focuses on smaller numbers of people (usually fewer than 100) and tries to answer “why” or “how” questions. Quantitative researchX answers questions that start with “how many” or “how much.” It gathers information from large numbers of people, often using surveys or questionnaires. Qualitative researchX focuses on smaller numbers of people and focuses on trying to answer questions about “why” or “how.” This type of research relies heavily on in-depth interviews. Most marketing research efforts combine both quantitative and qualitative methods. Marketing Essentials Chapter 28, Section 28.2

10. Attitude Research attitude research A type of research designed to obtain information on how people feel about certain products, services, companies, or ideas; also known as opinion research. Attitude researchX, also known as opinion research, is designed to obtain information on how people feel about certain products, services, companies, or ideas. Customers are usually asked to rate “how satisfied” they are with a product or service they purchased or used. Consumer panels, also called focus groups, are groups of people who are questioned to provide information. Marketing Essentials Chapter 28, Section 28.2

11. Attitude Research Example attitude research A type of research designed to obtain information on how people feel about certain products, services, companies, or ideas; also known as opinion research. Red Lobster’s POS system randomly selects tables to take a guest satisfaction survey (GSS). On the customer’s check a 1-800 is given to allow the customer to call within 48 hours. Reports are sent monthly to in each individual Red Lobster. Marketing Essentials Chapter 28, Section 28.2

12. Market Intelligence market intelligence Information about the size and location of a market, the competition, and the segmentation within the market for a particular product or service. Market intelligenceX is concerned with: The size and location of a market The competition The segmentation within the market for a particular product or service Market intelligence helps define potential target markets for a particular product or service and how to reach potential customers. Marketing Essentials Chapter 28, Section 28.2

13. Market Intelligence Sales forecasting is an attempt to estimate the future sales of an existing product. The share that is assigned to a business is called its market share or sales penetration of the market. Based on its findings, the business can try to increase its market share through changes in the product, pricing, promotion, or distribution strategies. The goal of market share and segmentation studies is to investigate the potential markets for new products and to define characteristics of the target market. Marketing Essentials Chapter 28, Section 28.2

14. Market Intelligence Economic forecasting is an attempt to predict the future economic conditions of a city, region, country, or other part of the world. Several federal agencies collect information on key economic indicators, such as: New building construction Inflation rates Money supply Consumer and producer price indexes This research helps to determine whether to cut costs when unfavorable economic conditions are predicted. Marketing Essentials Chapter 28, Section 28.2

15. Market Intelligence Research Example Sales forecasting is an attempt to estimate the future sales of an existing product. The share that is assigned to a business is called its market share or sales penetration of the market. Based on its findings, the business can try to increase its market share through changes in the product, pricing, promotion, or distribution strategies. Marketing Essentials Chapter 28, Section 28.2

16. Media Research media research A type of research focusing on the issues of media effectiveness, selection, frequency, and ratings; also known as advertising research. Media researchX, also known as advertising research, focuses on issues of media effectiveness, selection, frequency, and ratings. Media research studies: Brand awareness Advertising recall Brand image Effectiveness of advertising copy Audience size for a particular type of advertising Marketing Essentials Chapter 28, Section 28.2

17. Media Research Important statistics for media measurement include: Audience – the number of homes or people exposed to the advertising medium Frequency – the number of times a person sees or hears an ad Reach – the percentage of the target audience that will see or hear an ad at least once Ratings – the total number of audience impressions delivered over a set period of time Marketing Essentials Chapter 28, Section 28.2

18. Media Research To obtain these measures, businesses often request information from the media of interest to them. In most cases, the information includes a rate card listing the: Advertising costs Circulation or viewership figures Deadline dates Other requirements for submission of an advertisement Marketing Essentials Chapter 28, Section 28.2

19. Media Research To determine the effectiveness of printed media, readers are asked about the extent to which they noticed the ad, remembered it, and associated it with the advertised brand. Readership in print media is measured by surveys or estimated by circulation. Marketing Essentials Chapter 28, Section 28.2

20. We are going to view ten advertisements from magazines or newspapers for approximately 5 seconds each. Study them carefully. Activity

31. Write down the subject of as many ads as you can remember. Try and recall key details, such as illustrations, colors, slogans, etc. Which stuck in your minds and why? Were you more likely to remember a brand name or type of product? Activity

32. Media Research Example What we just did is considered a form of media research. To determine the effectiveness of printed media, readers are asked about the extent to which they noticed the ad, remembered it, and associated it with the advertised brand. Readership in print media is measured by surveys or estimated by circulation. Marketing Essentials Chapter 28, Section 28.2

33. Product Research product research The evaluation of product design, package design, product usage, and consumer acceptance of new and existing products. Product researchX centers on evaluating: Product design Package design Product usage Consumer acceptance of new and existing products Product research is also conducted to collect information about competitive products. Marketing Essentials Chapter 28, Section 28.2

34. Product Research Example Concept testing, product positioning, and pricing studies are frequently done with focus groups to get initial consumer reactions to a product or service idea. Marketing Essentials Chapter 28, Section 28.2

35. The Marketing Research Process The five steps that a business follows when conducting marketing research are: Defining the problem Obtaining data Analyzing the data Recommending solutions Applying the results Marketing Essentials Chapter 29, Section 29.1

36. The problem or research issue is identified and goals are set to solve the problem. Step 1 – Define the Problem

37. Step 2: Obtaining Data primary data Data obtained for the first time and used specifically for the particular problem or issue under study. secondary data Data that has already been collected for some purpose other than the current study. The word data means facts. There are two types of data used in marketing research: Primary dataX are facts obtained for the first time and used specifically for the particular problem or issue under study. Secondary dataX have already been collected for some purpose other than the current study. They are less expensive to collect than primary data. There are many ways secondary data can be obtained from both internal sources (within the company) and external sources. Marketing Essentials Chapter 29, Section 29.1

38. How Secondary Data Are Obtained Secondary data are most often collected in the following ways: The Internet U.S. and state government sources Specialized research companies Business publications and trade organizations Marketing Essentials Chapter 29, Section 29.1

39. Secondary Data There are two major disadvantages to secondary data: The existing data may not be suitable for the problem under study. The data may sometimes be outdated and/or inaccurate. Marketing Essentials Chapter 29, Section 29.1

40. How Primary Data Are Obtained survey method A research technique in which information is gathered from people through the use of surveys or questionnaires. sample A part of the target population that is assumed to represent the entire population. Primary research data can be collected using three methods: The survey method The observation method The experimental method The survey methodX is a research technique in which information is gathered from people through the use of surveys or questionnaires. It is the most frequently used method of collecting primary data. A sampleX is a part of the target population that represents it accurately. Marketing Essentials Chapter 29, Section 29.1

41. How Primary Data Are Obtained 1. Survey research can be conducted in person, by phone, by mail, or by using the Internet. When the marketer has decided how to conduct the survey, he or she then writes the questions according to the specific needs of that survey type. Personal interviews can be done in focus groups, door-to-door, or randomly in central locations. Marketing Essentials Chapter 29, Section 29.1

42. How Primary Data Are Obtained observation method A research technique in which the actions of people are watched and recorded either by cameras or by observers. The 2.observation methodis a research technique in which the actions of people are watched and recorded either by cameras or by observers. A mystery shopper is a researcher who poses as a customer. The mystery shopper observes the interactions between customers and salespeople to evaluate the effectiveness of sales staff. One disadvantage of the observation method is that it cannot measure attitudes or motivation. Two advantages of the observation method are that it is faster than personal interviews, and people are unaware that they are being observed, so they act as they normally would Marketing Essentials Chapter 29, Section 29.1

43. How Primary Data Are Obtained experimental method A research technique in which a researcher observes the results of changing one or more marketing variables while keeping certain other variables constant under controlled conditions. The 3. experimental methodis a technique in which a researcher observes the results of changing one or more marketing variables while keeping others constant under controlled conditions. It is not used frequently because of the cost of setting up the research conditions and the inaccuracy of the responses. Marketing Essentials Chapter 29, Section 29.1

44. Step 3: Analyzing the Data data analysis The process of compiling, analyzing, and interpreting the results of primary and secondary data collection. Data analysisX is the process of compiling, analyzing, and interpreting the results of primary and secondary data collection. Data mining is a computer process that uses statistical methods to extract new information from large amounts of data. Marketing Essentials Chapter 29, Section 29.1

45. Step 4: Recommending Solutions to the Problem Solution recommendations must be clear and well-supported by the research data. A typical research report includes the following: Title page Acknowledgments of people who assisted Table of contents List of tables, figures, charts, and graphs Introduction Review of the research information Procedures used Findings Recommendations Summary and conclusions Appendixes Bibliography Marketing Essentials Chapter 29, Section 29.1

46. Step 5: Applying the Results Managers use the research report to make decisions about marketing strategies to address the researched problem or issue. After the research is completed and changes are made, a business should carefully monitor the results to know if the actions are successful. Marketing Essentials Chapter 29, Section 29.1

47. Constructing the Questionnaire validity When questions asked on a questionnaire measure what was intended to be asked. reliability When a research technique produces nearly identical results in repeated trials. A questionnaire has validityX when the questions asked measure what was intended to be measured. ReliabilityX exists when a research technique produces nearly identical results in repeated trials. It requires that the questions ask for the same type of information from all respondents. To be valid and reliable, a questionnaire must be properly: Written Formatted Administered Marketing Essentials Chapter 29, Section 29.2

48. Writing Questions open-ended questions Questions that require respondents to construct their own answers. forced-choice questionsQuestions that ask respondents to choose answers from possibilities given on a questionnaire. Open-ended questionsX ask respondents to construct their own response to a question. Forced-choice questionsX ask respondents to choose answers from possibilities on a questionnaire. Yes/No questions should be used only when asking for a response on one issue, for example, “Was our facility well maintained?” Having a question that asks about more than one issue decreases validity and reliability. Marketing Essentials Chapter 29, Section 29.2

49. Writing Questions Multiple-choice questions give the respondent several choices. When constructing these, it is important to make the options mutually exclusive and comprehensive enough to include every possible response. Offering the choice of “other” increases reliability. Marketing Essentials Chapter 29, Section 29.2

50. Writing Questions Other forced-choice questions may ask respondents to rate a product or service based upon a scale. Level of agreement questions make statements and ask respondents for their level of agreement. Commonly used options include strongly agree, agree, neutral, disagree, and strongly disagree. Marketing Essentials Chapter 29, Section 29.2