What Have We Covered So Far? Problem Formulation and Approach

What Have We Covered So Far?Problem Formulation and Approach • Understanding the managerial decision problem/opportunity • Translate into research objective • Pose the right research questions • State questions in terms of hypotheses • Know what information is needed

Weyerhaeuser • What marketing mix elements discussed in the case history led Weyerhaeuser to act. • What industry and economic background information is relevant in this case? • What is Weyerhaeuser’s management decision problem? • What courses of action were open to Weyerhaeuser? • What were the events that led Weyerhaeuser to decide to act? • What criteria will be used to evaluate these alternatives? • How important is the information gained from the focus group studies in formulating the marketing decision. • What information does Weyerhaeuser need to make a decision? • What was Weyerhaeuser marketing research problem? • What are some research questions that could be asked and what hypotheses could you make. • What are some of the components of the Research Approach?

The Marketing Research Process PROBLEM FORMULATION DEVELOP AN APPROACH • RESEARCH DESIGN • Exploratory, Descriptive, Causal • Primary/Secondary data • Sample plan/measurement issues Today’s Focus DATA COLLECTION DATA ANALYSIS RESEARCH REPORT

Research Design • Definition • A framework for conducting the marketing research project • Components • Information needed • Data collection methods • Measurement and scaling procedures • Sampling process and sample size • Data analysis procedures

Conclusive Research Design Descriptive Research Causal Research A Broad Classification of Marketing Research Designs Research Design Exploratory Research Design Secondary Research Qualitative Research

Exploratory Research: Overview • Characteristics • flexible, versatile, but not conclusive • Useful for • discovery of ideas and insights • Formulating problems more precisely • Identifying alternative courses of action • Establishing priorities for further research • Methods Used • case studies • secondary data • focus groups • qualitative research

Exploratory Research Cont’d • When done? • Generally initial research conducted to clarify and define the nature of a problem • Does not provide conclusive evidence • Subsequent research expected

Conclusive Research • Characteristics • inflexible, versatile • Results conclusive • Research formal and structured • Used • to provide decision maker with the information needed to make sound decision • Testing hypotheses and examining relationships • When information needs clearly defined

Conclusive Research Design Descriptive Research Causal Research

Descriptive Research: Overview • Characteristics • Describes characteristics of a population or phenomenon • Some understanding of the nature of the problem • preplanned, structured, conclusive • Useful for • describing market characteristics or functions • Methods Used • Surveys (primary data) • panels • scanner data (secondary data)

Descriptive Research • When Used: • Often a follow-up to exploratory research • Examples include: • Market segmentation studies, i.e., describe characteristics of various groups • Determining perceptions of product characteristics • Price and promotion elasticity studies • Sale potential studies for particular geographic region or population segment

Descriptive Research Designs • Two types of designs • Cross-sectional designs • Involves collection of information from sample of respondents only once • Could have a single cross-sectional design (only one sample) or multiple cross-sectional design (many samples of respondents) • Most popular design in marketing research • Example: Sample surveys

Descriptive Research Designs (contd.) • Longitudinal Designs • A fixed sample of the population is measured repeatedly, i.e., same respondents studied over time • Useful for tracking changes in consumer attitudes and behavior over time • Example: Dairy panel data • Mixed Designs: • Example: US Bureau of Labor Statistics follows a consumer panel for five quarters, then switches to a new panel of consumers

Examples of Descriptive Studies • Market studies that describe the size of the market, buying power of the consumers, availability of distributors, and consumer profiles • Market share studies that determine the proportion of total sales perceived by a company and its competitors • Sales analysis studies that describe sales by geographic region, product line, type of account size of account • Image studies that determine consumer perceptions of the firm and its products • Product usage studies that describe consumption patterns • Distribution studies that determine traffic flow patterns and the number and location of distributors • Pricing studies that describe the range and frequency of price changes and probable response to proposed price changes • Advertising studies that describe media consumption habits and audience profiles for specific television programs and magazines

Causal Research: Overview • Characteristics • causal (independent) variables be manipulated in a controlled fashion • Useful for • determining cause and effect relationships • Methods Used • Experiments • Primary data

Summary • After formulating the problem, getting the design right is the most important step • Three main types of research design types: Generally combinations of all three employed in the research process • Need to worry about various sources of error in research design

Degree of Problem Definition Exploratory Research Descriptive Research Causal Research (Unaware of Problem) (Aware of Problem) (Problem Clearly Defined) “Our sales are declining and “What kind of people are buying “Will buyers purchase more of we don’t know why.” our product? Who buys our our products in a new package? competitor’s product?” “Would people be interested “Which of two advertising in our new product idea?” “What features do buyers prefer campaigns is more effective?” in our product?” possible situation

Tasks Involved in Formulating a Research design • Specify the information needed • Design the exploratory, descriptive and/or causal phases of the research • Specify the measurement and scaling procedures • Construct an pretest a questionnaire (interview form) or an appropriate for data collection • Specify the sampling process and sample size • Develop a plan of data analysis

I keep six honest serving men, (they taught me all I knew), their names are what and why, and when, and how, and where and who” --Rudyard Kipling

WestJet wants to know whether it should expand its flight offerings into the International Market. In designing a market research project to provide WestJet with information to help them decide, answer the following six questions. • Who should be considered? • Where should the respondents be contacted to obtain the right information? • When should the information be obtained from respondents • What information should be obtained? • Why are we obtaining the information from the respondents • What Way are we going to obtain information

Sources of Error in Research Design • Total Error: Difference between true mean value of variable in population, and observed mean value obtained. Can be split into two main types: • Random Sampling Error: Occurs because particular sample selected is imperfect representation of the population of interest • Non-sampling Error: Due to sources other than sampling, e.g., errors in problem definition questionnaire design, data analysis.

Critical Path Method (CPM) • INPUTS • List of project activities • Precedence relationship among activities • Estimate of each activity’s duration CPM processing procedures • OUTPUTS • Estimated duration of project • Identification of critical activities • Amount of slack for each activity

CPM Terminology • Path • A connected sequence of activities leading from the starting event to the ending event • Critical Path • The longest path (time); determines the project duration • Critical Activities • All of the activities that make up the critical path

Steps in CPM Analysis • Draw the CPM network • A graphic view of the relationships among the required activities • Analyze the paths through the network • Determine the length of each path (the time required to complete each path) • Starting at the beginning of the network and working toward the end (from left to right), determine the estimated start and estimated finish for each activity

Steps in CPM Analysis • Path analysis (continued) • Identify the critical path(s) (the longest path[s] through the network) • The critical path(s) determines how long the project will take

Marketing Research Proposal See page 98-99 Malhotra

What Have We Covered So Far? Problem Formulation and Approach