04. MARKETING RESEARCH

Transcription

1 04. MARKETING RESEARCH Marketing research can be defined as the systemetic gathering, recording, and analyzing of information about specific issues related to the marketing of goods and services. The main purpose of marketing research is to provide information to decision makers in the marketing department of an organization. Types of decisions include Strategic and Tactical decisions. Strategic Decisions- Related to Segmentation of the Market, Target Market Selection, and Positioning of the Product. Tactical decisions- Related to the 4 Ps of marketing Product, Pricing, Promotion and Place (Physical Distribution) Sources of Information Information can come from multiple sources. Two main sources are Marketing Intelligence and Marketing Research. Marketing Intelligence - a continuous process, usually internally managed, based on published or otherwise available data, may be stored for future use. Examples of Intelligence - Industry Data, Competitor s Announcements. Marketing Research - data collected for specific action or decision problem, focused, with a time and budget, done by external marketing research company or by company staff, usually with a written report and/or presentation to the study s sponsor Who Does The Marketing Research? 1. Professional marketing research companies like ORG-MARG, IMRB, TN Sofres Mode, Gallup MBA. 2. In-house marketing research department 3. Company staff from marketing/sales/customer service departments Typical Applications of Marketing Research 1. Segmentation Studies to identify consumer segments based on their demographic, psychographic or behavioral characteristics. 2. To evaluate specific product-markets/segments for the potential demand 3. Positioning Studies to study consumer perceptions regarding the brand being studied vis-à-vis competing brands 4. Concept Testing, or Product related research 5. Pricing research to determine price perceptions and correct levels of prices 6. Distribution Research to determine convenience of shopping channels, availability of brands and point of purchase behaviour 7. Advertising Research to test effectiveness of ads, media etc. When To Do Marketing Research? 1. There is an information gap 2. The cost of filling this gap is less than cost of a wrong decision 3. The research will be completed in time to help in decision-making Secondary and Primary Research 1. Secondary research is that which is available for reference to a researcher, but collected for some other purpose (not for the current research). Some common sources of secondary data are newspapers, magazines, the internet, and internal or external reports compiled or published by various organizations. 2. Primary research is information specifically collected for the research being done. Some common forms of primary data collection are personal or telephonic interviews with customers, retailers, mail surveys of respondents, focus group discussions, etc. Sources of Secondary Data There are two major sources of secondary data.internal.external Internal records in the company comprise information about the product being researched, its history, company background and history, market share, and competitor information. These types of information are usually maintained by the marketing department, sales department, or a corporate cell for marketing intelligence in the company.

2 MB208 Marketing Management 04. Marketing Research Page 2 of 5 External information sources include syndicated reports such as retail sales data, or market share data, or industry analyses. Some of this information may be available from public sources such as business newspapers, magazines, industry associations or trade bodies, or the net. A prominent source of data on Indian industry is the CMIE or Centre for Monitoring Indian Economy, which publishes monthly reports on various aspects of the Indian economy and industry. The Hindu, a prominent daily newspaper, publishes an annual Survey of Indian Industry, which is a low-priced and useful compilation which deals with industrial goods, infrastucture and core industries, consumer durables growth prospects and past performance. Syndicated research studies such as the NRS (National Readership Survey) or IRS (Indian Readership Survey) are rich sources of data available to any subscriber or buyer. These studies cover a large national sample, and measure the readership of newspapers and magazines in great detail. They also cover demographics and consumption patterns of household consumer goods. The Audit Bureau of Circulation (ABC) is an autonomous body which certifies the circulation of newspapers and magazines. The Indian Newspapers Society (INS) also publishes a handbook every year with circulation, readership and advertisement tariffs for various print media in the country. There are several computer-based data sources which provide on a sale and subscription basis, updated information on financial and sales data on all publicly listed companies. Now, some of this data is available on the internet, particularly industry analyses. Steps of Research A marketing research project starts with an information need. It ends with an actionable report or presentation or both. In between are various steps to ensure that the marketing research project achieves what it set out to do. Information Need -> Defining the Research Objective -> Research Designs -> Designing the Research Methodology -> Presentation, Report and Marketing Action Information Need The marketing manager has to identify an information need, and it should be fulfilled by a marketing research study. Also, the cost of not having this information should be estimated. Defining the Research Objective If we have an information need that can be met by doing marketing research, the next step would be to define the Research Objective in terms of that information need. For example, a study could have as its objective, the determination of customer satisfaction with a brand of new frost-free refrigerator launched by our company. Sometimes, we call the research objective by another name the research problem. Broadly, these two terms can be used interchangeably. A research objective can be specified broadly, or narrowly. One common pitfall in the field of marketing research is to specify too many objectives for a single marketing research project. It produces a mass of data that is not really needed at that point of time. In most cases, about four or five objectives are adequate to do a useful marketing research study. Every objective translates into a few questions on a questionnaire, and there is a limit to how many questions a respondent can honestly answer before his interest level goes down. Research Designs: Exploratory, Descriptive and Causal A research design provides the framework to be used as a guide in collecting and analysing data. Broadly speaking, we can classify research designs into the following three kinds - Exploratory Research: It is generally used to clarify thoughts and opinions about the research problem or the respondent population, or to provide insights on how to do more conclusive (causal) research. The methods used in exploratory studies can range from the usual surveys, to focus groups, to consultations with experts in the field, to analysis of selected cases. An example of the last may be to study three of a company's best salespeople, and three of the worst, to try and figure out what drives the sales of the products, and their motivations. This could help in designing a study of customers to find out more from them.

3 MB208 Marketing Management 04. Marketing Research Page 3 of 5 Descriptive Research: Most marketing research is of this type. Typically, descriptive studies are either (1) longitudinal or (2) cross-sectional. Longitudinal studies These generally take the form of a sample which is studied over a period of time - from a few months to a few years. Cross-sectional design It is the most commonly used in marketing research. This is a one-shot research study at a given point of time, and consists of a sample (cross-section) of the population of interest. The typical market survey is of this type. Causal Research In research, we can never be completely sure that a particular variable (say X) influences another (say Y). But a causal design seeks to establish causation as far as possible, by employing controls and conditions under which we can state with reasonable confidence whether or not Y is affected by X. Designing The Research Methodology The major parts of the research methodology that need designing are Data Collection Methods Secondary and Primary Sampling Plan Questionnaire Design (if applicable) Field Work Plan Analysis Plan Data Collection Methods It is possible to collect primary data from respondents by many different methods. The major methods commonly used are.survey.observation.experimentation.qualitative Techniques.Other specialised techniques Sampling Plan This is the statement of what will be the sample composition and size. This is the most critical of all decisions in the marketing research process, because we are usually trying to make a statement about the target population based on our study of the sample. One can choose from probabilistic or non-probabilistic sampling methods. Probabilistic sampling methods like simple random sampling, or stratified random sampling are preferred over non-probabilistic sampling methods which tend to be biased. Some common non-probabilistic sampling methods are convenient sampling and snowball sampling. Field Work Plan This is clearly linked to the sampling plan. Once the sampling centres (cities, towns, etc.) are decided on, and the sample sizes are determined for each, the next step is to plan on the following.who.when The first question is who will do the field work for collecting data. Field work assumes that we are collecting data from respondents by going to the field that is, homes, offices, shops, dealerships, etc. The second question is when. In many studies carried out nationally, it is not possible always to simultaneously cover all centres, on the same days. There could be logistical problems for supervisors, or there may be difficulties in recruiting adequate field workers etc. But it is desirable to have a well-planned schedule so that all field work is completed in an orderly fashion, and cross-checks can be established. Briefing For all important studies, the research executive in charge should personally brief the field supervisor (the person who will actually supervise the team of field workers during the data collection). This briefing session is conducted after recruiting field workers, and ends with a practice round of mock interviews and questions from field workers on any special difficulties they may encounter in locating respondents, asking certain questions, etc.

4 MB208 Marketing Management 04. Marketing Research Page 4 of 5 Debriefing It is important that any problems on the field get reported to the field supervisor or the research executive, and solutions found quickly. These problems may include difficulty in locating target sample units, or non-cooperation in answering some questions, or difficulties in comprehension. Analysis Plan and Expected Outcome Analysis is based on the answers given to questions. It is important to have an analysis plan in mind even before going to the field with a questionnaire. In certain cases, special statistical procedures or tests have to be performed. For example, in a procedure called multidimensional scaling, the questionnaire has to be constructed in a particular way. Otherwise, it is not possible to do the required analysis. There are normally two very basic kinds of analyses in a marketing research study. These are.simple Tabulation.Cross Tabulation Simple Tabulation involves counting the number of responses in each category for a question, and putting it in a frequency table form. This can be used to compute percentages, by dividing the number of responses by the sample size. This is done for each question in the questionnaire. Cross Tabulation: This is the result of counting simultaneously, answers to two or more different questions on a questionnaire. For example, one question may ask how frequently respondents buy a soap brand. Answers may vary from Once a Month to Thrice a Month. Presentation, Report and Marketing Action After the tabulation and analysis is completed, the next step is usually a presentation to the sponsor of the study. This includes frequency tables and cross tabulations in percentage terms, and special analyses if any. It also includes a summary of major findings, and some recommendations. If any additional cross tabulations are required, the client or sponsor usually requests them at this stage. A formal report usually follows the presentation. This should normally contain the following :. Executive Summary. Table of Contents. Introduction. Research Objectives. Research Methodology Sample Design Field Work Plan and Dates Analysis / Expected Outcome Plan Questionnaire Copy (as Annexure).Analysis Simple Tabulation Cross Tabulation Any Special Analysis.Findings.Limitations.Recommendations for Action.Bibliography / List of References Based on the report, the client normally will take some marketing actions. This is the expected outcome of any marketing research study.

5 MB208 Marketing Management 04. Marketing Research Page 5 of 5 Questionnaires Questionnaires are formal sets of questions prepared to collect the required information. This is one of the most effective and popular techniques used in surveys. However, one has to be careful when drawing up questionnaires. Before deciding on the questions, it is important to understand the exact nature of the information required and who should be interviewed. The contents, phrasing and the sequence of the questionnaire should also be clear and unambiguous. The knowledge levels of the target respondents should be kept in mind while drawing up the questions. Marketing researchers distinguish between closed-end and open-end questions. Closed-end questions pre specify all the possible answers. Open-end questions allow the respondents to answer in their own words. Some examples of closed-end questions and open-end questions are given below: Name Description Example Closed-end Questions Dichotomous A question with two possible answers. What is your gender? Male Female Multiple choice A question with three or more answers. How often do you use ketchup? ( ) Several times daily ( ) Once Daily ( ) Sometimes in a week ( ) Once a week ( ) Rarely ( ) Never Likert Scale Rating Scale A statement with which the respondent shows the amount of agreement/ disagreement. A scale that rates some attribute from poor to excellent. Ketchups make curries tastier. ( ) Strongly Disagree ( ) Disagree ( ) Neither agree nor disagree ( ) Agree ( ) Strongly Agree Maggi Tomato Ketchup is ( ) Excellent ( ) Very Good ( ) Good ( ) Fair ( ) Poor Completely Unstructured Sentence Completion Open-end Questions A question that respondents can answer in his own style. The respondents complete an incomplete sentence. What is your opinion of Ketchups? When I choose a Ketchup, the most important consideration in my decision is