Marketing Research

and Information
Systems

chapter 4
Harcourt, Inc.
 Objectives

 Understand the most commonly used

market research methods to explain
changing consumer, competitor and
channel behavior
 Explain the basic market research
process
 Describe a number of methods of
studying consumers
 Objectives

 Understand how new technology

such as scanners and the Web is
revolutionizing market research
 Question the validity of survey
research
 Know where to start looking for
secondary data
 Objectives

 Evaluate current and potential

competitors
 Understand the importance of
studying the history of the market
 Understand the principles of
channel research
Marketing Decision Support System

 Collection of internal and external

data
 Marketing information system and
storage
 Dissemination of information to
decision-makers
 Integration of data into company
objectives/plans
 Research Process
Problem
Recognition
Define
Problem
Secondary
Research
Quick Primary
Research
Primary
Research
Analyze
Information
Present
Findings
 Consumer Research

 Qualitative observation research

 Customer visits in business-to-
business marketing
 Focus group research
 Electronic observational research
 Decision support systems
 Consumer survey research
 Secondary data analysis
Consumer Research
Qualitative Observation Research

 Voice of the customer

 Hands-on consumer
research

 Motivational research
Consumer Research
Qualitative Observation Research

 Voice of the customer

 Expression of the
 Hands-on consumer preferences,
research opinions and
motivations of the
customer
 Motivational research
Consumer Research
Qualitative Observation Research

 Voice of the customer

 Conducted by
direct observation
 Hands-on consumer by managers of the
research way current
customers use
specific products
 Motivational research and brands
Consumer Research
Qualitative Observation Research

 Voice of the customer  Research method

directed at
discovering the
 Hands-on consumer conscious or
research subconscious
reason that
motivates a
 Motivational research person’s behavior
Consumer Research Customer Visits in
Business-to-Business Marketing
Consumer Research
Focus Group Research

 A focus group is a carefully recruited

group of
 Six to twelve people who participate in
a free wheeling,
 One to two hour discussion that focuses
on a particular
 Subject, such as product usage,
shopping habits, etc.
Consumer Research
Electronic Observational Research

 Bar-coding and
scanning
Consumer Research
Decision Support Systems

 A decision support system (DSS)

is a set of computer
 Software programs that help
managers
 Make marketing mix decisions.
Consumer Research
Decision Support Systems
Unisys Infosystems

Bozell, Incorporated
Consumer Research
Decision Support Systems
Customer sends in Record is added to
warranty card, enters database using
sweepstakes, etc. database
Permission is given to to management
record and use software (e.g.,
information for direct Microsoft Access)
marketing

2 3 Target segment is
Database elements specified and deep-
segmentation statistical
are specified (name,
address, hobbies,
1 4 analysis identifies
etc.) The source of hobbies, interest, usage
record and data are situation, and
added 6 5 promotion preferences

Database is Most appealing

updated, direct-marketing
recording campaign is designed
response of to promote most
customer to appealing products
campaign and features to target
segment
Decision Support System
Components of a System

Integration
with plan
Marketing
Database

Marketing Dissemination
Information to decision
System makers
Decision Support System
Marketing Database

Internal components External components

 Sales analysis  Secondary data

 Cost analysis  Purchase of
 Financial records syndicated
commercial data
 Marketing research
Consumer Research
Consumer Survey Research
Criteria Direct/Cold Mail Panels Telephone Personal In- Mall
Mailing Home Intercept
Complexity and Substantial,
versatility Not much Not much difficult to use Highly flexible Most flexible

Limited to < 25
Quantity of data Substantial Substantial Short Greatest quantity minutes

Good, nonlisted a
Sample control Little Substantial problem Greatest controls Problematic

Clear up
Better for sensitive ambiguities,
questions, no socially accepted Unnatural testing
Quality of data claifier answers Cheating bias

Response rate ~10% 70-80% 60-80% 80% + 0.8

Faster than mail,

Several weeks + slower than
Speed follow ups Several weeks 3-4 weeks telephone A few days

$2.50 per Relatively Less expensive

Cost interview Lowest Not as low as mail expensive than in-home

Executive, Pervasive-concept
industrial, Studies that tests, name tests,
medical, require national package tests,
Uses readership All areas samples Product testing copy tests
Consumer Research
Consumer Survey Research

 Reliability
 The consistency of
measurement over
time
 Validity
Consumer Research
Consumer Survey Research

 Reliability
 The accuracy in
measuring what is
intended to be
measured
 Validity
Consumer Research
Secondary Research

www.census.gov
www.stat-usa.com
www.yahoo.com
www.altavista.com
www.lycos.com
 Competitor Research

 Research Market
History

 Audit Current
Competitors
 Competitor Research
 Research Market  Researching the
History history of the
 Audit Current
market
Competitors  Identifiesthe
marketing mix and
product
 dimensions on
which sellers have
competed strong
Competitor Research
Levels of Competition

Ice
Cream Beer

Regular
Colas Juice
Wine
Diet-Rite
Cola
Target Segment Core Benefit
Fast Fruit Diet Competition: Competition:
Food Colas Pepsi Diet Colas Beverages
Product
Diet Category
Coke Competition:
Bottled
Lemon Soft Drinks
Water Budget
Limes Competition:
Food and
Entertainment
Coffee

Baseball
Cards
Competitor Research
Current and Potential Competition
Threat through vertical Threat through vertical
integration or encouraging integration or encouraging
new entry Threat of new entrants, new entry
including those resulting
from mergers and
takeovers

Suppliers who work to Distributors who work to

make you more Competition among make you more
competitive or play you current rivals competitive or play you
against your competition against your competition

Threat through joint Substitute threats

venturing if suppliers’ Threat through joint
product/services are venturing or encouraging
involved entry
 Competitor Research
 Research Market  Auditingcurrent
History competitors
 Identificationof
 Audit Current
Competitors rivals from which
you are gaining
 business and to
which you are
losing business
Competitor Research
New Competitive Threats Audit
New Technology - Converging Markets Threat
What price changes in other technology markets appear to influence our sales? Is this effort changing?
Which new technology or service is starting to be considered as a substitute for our product or service by
consumers? Is this occuring in any particular usage situation or by any particular group of buyers? Are our
existing channels encouraging such sub
What is our closest new technological or service competition?
Who is the major mover and shaker in this new industry?
What appears to be its current objective and strategy?
What is its growth rate?
What has been its effect on our sales?
What further threat does it pose?
What constraints does it face?

Channel Integration Threat

Which supplier is most likely to become a downstream direct competitor in the near future? Why? How would it
do it? Is there any evidence of this occuring?
Which customers are most likely to become upstream, do-it-themselves competitors in the near future? Why?
How would they do it? Does any evidence of such plans exist?

Competitor Takeover - Merger Threat

Which mergers, takeovers, or trading coalitions among competitors or from inside pose the greatest threat to
our position? What evidence exists that this is likely to occur?
Competitor Research
A Competitive Analysis Template
 Research Market  Evaluate w/respect to:
History  Financial Position
 Market Position
 Audit Current  Product Position
Price Position
Competitors 

 Inbound Logistics
 Production Process
 Outbound Logistics
 Trade Relations
 Advertising & Promotions
 Sales Force Process
 Channel Research
Summary Evaluation Competitive Selling Effort
Image and Reputation Quality of locations
Geographical markets/customer segments served Quality of advertising
Major strength, unique value, and importance of Quality of premises
this reseller
Major weakness and failure of reseller Quality of sales staff
Special personal relations with supplier Sales-staff knowledge of our products
Inventory management
Extent we are treated as a preferred supplier
Special marketing efforts and cooperation
Purchasing Behavior
Recent ordering history
Volume deals/discounts sought and given
Detailed Evaluation
Trading Performance Other allowances and considerations sought and
given
Annual sales Freight
Annual sales of our product Cooperative advertising
Contribution earned from sales to this reseller Promotions
Average stock-turn of our products Returns
Past average stock-turn of our products Push money and sales contests
Profit performance Special credit terms
AMA Definition of Marketing Research

 Specifies the information needed

 Designs the method of collecting
information
 Manages and implements the data
collection process
 Analyzes the results
 Communicates the findings and
implications
Types of Marketing Research Firms

 Syndicated Service
Firms
 Full-Service Research
firms
Types of Marketing Research Firms

Syndicated Service Firms

 Collect and distribute for many

firms
 Firms share the cost
 Examples: A.C. Nielson, J.D.
Powers, Simmons, Arbitron
Types of Marketing Research Firms

Full-Service Research Firms

 Collect and distribute for one client

 Client assumes entire cost of project
 Research firm takes over marketing
research function on behalf of client
The Marketing Research Process

 Define the problem

 Research design
 Data collection
 Analysis,
interpretation
and presentation
The Marketing Research Process
Problem Definition

 Well defined problems are half

solved
 Help set research objectives
 Help define data collection
process
The Marketing Research Process
Exploratory Research

 Helps gain understanding of the

research question
 Aids in understanding the cause(s) of
the problem
 Discuss the problem with informed
sources - customers, suppliers, etc.
 Analyze internal records and data
The Marketing Research Process

 Define the problem

 Research design
 Data collection
 Analysis,
interpretation
and presentation
The Marketing Research Process
Research Design

 Master plan for research

 Identifies the need for primary
versus secondary data
The Marketing Research Process
Research Design
Primary Data

 Information or Secondary Data

statistics collected for
the first time during a  Previously published
marketing research data
study
The Marketing Research Process
Sources of Primary Data
Observation Survey Method
Method
 Observational studies  Telephone interviews
are conducted by  Mail surveys
actually viewing  Personal interviews
objects, events, and/or
 Focus group
a person’s behavior
interviews
The Marketing Research Process
Sources of Primary Data
Experimental Method
 In experiments the researcher
manipulates one or more of
the marketing mix variables
and compares the effect on
the experimental group to a
control group that did not
receive the manipulation
The Marketing Research Process
Sources of Secondary Data
Internal Data Government Data

 Includes sales  Census of Population

analysis reports,  Census of Housing
financial performance  Census of Business
reports, cost analysis,  Census of Manufacturers
product profit/loss  Census of Agriculture
statements, etc.  Census of Minerals
 Census of Governments
The Marketing Research Process
Sources of Secondary Data

Research Firm Data

 Many private organizations

provide information for the
marketing executive e.g.
trade associations,
advertising agencies,
“Survey of Buying Power.”
The Marketing Research Process

 Define the problem

 Research design
 Data collection
 Analysis,
interpretation
and presentation
The Marketing Research Process
Sampling Techniques

Population Census

 Total group that the  Collection of data

researcher wants to from all possible
study sources in a
population or
universe
The Marketing Research Process
Sampling Techniques
Probability Sample

 Sampling techniques
where respondents
have a known
(nonzero) chance of
being chosen
The Marketing Research Process
Sampling Techniques
Probability Sample

Simple Random
 Probability sample
Sample where researchers
choose respondents
from a complete list
of the population
The Marketing Research Process
Sampling Techniques
Probability Sample
 Probability sample
where researchers
Simple Random divide the complete
Sample
population list into
groups and then use
Stratified Sample
single random
sampling techniques
on the subgroups
The Marketing Research Process
Sampling Techniques
Probability Sample

 Probability sample
Simple Random where researchers
Sample randomly choose
areas of geographic
Stratified Sample clusters before
random cluster
selection
Cluster Sample
The Marketing Research Process
Sampling Techniques
Nonprobability Sample

 Arbitrary sampling
technique where
respondents have an
unknown or zero chance
of being chosen for the
sample
The Marketing Research Process
Sampling Techniques
Nonprobability Sample

 Nonprobability sample
where researches choose
respondents based on Convenience Sample
ease of availability of
respondents
The Marketing Research Process
Sampling Techniques
Nonprobability Sample

 Nonprobability sample
where researchers
conveniently match Convenience Sample
characteristics in the
population with quotas
Quota Sample
The Marketing Research Process
Sampling Techniques
Nonprobability Sample

 Nonprobability
sample based on Convenience Sample
arbitrary judgments
by the researcher Quota Sample

Judgement Sample
The Marketing Research Process

 Define the problem

 Research design
 Data collection
 Analysis,
interpretation
and presentation
The Marketing Research Process
Analysis, Interpretation, and Presentation

 Must present findings in clear,

understandable manner
 Communicate properly with
audience