Marketing Research

The Marketing Research Role in Marketing Management

Dependent variables (Effects)Dependent variables (Effects)Independent variables (Causes)

Independent variables (Causes)

BehavioralResponse

1 Awareness 2 Knowledge 3 Liking 4 Preference 5 Intent-to-buy 6 Purchase

BehavioralResponse

1 Awareness 2 Knowledge 3 Liking 4 Preference 5 Intent-to-buy 6 Purchase

Marketing mix(controllable)

1 Price decisions 2 Promotion decisions 3 Distribution decisions 4 Product decisions

Marketing mix(controllable)

1 Price decisions 2 Promotion decisions 3 Distribution decisions 4 Product decisions

Situational Factors(uncontrollable)

1 Demand 2 Competition3 Legal/political 4 Economic climate5 Technological 6 Gov’t. regulation7 Internal resources of the organization

Situational Factors(uncontrollable)

1 Demand 2 Competition3 Legal/political 4 Economic climate5 Technological 6 Gov’t. regulation7 Internal resources of the organization

Performance Measures1 Sales 2 Market Share3 Cost 4 Profit5 ROI 6 Cash flow7 Earnings / Share8 Image

Performance Measures1 Sales 2 Market Share3 Cost 4 Profit5 ROI 6 Cash flow7 Earnings / Share8 Image

Cont …

TYPES OF INFORMATION NEEDED FOR PLANNING AND CONTROL

I Situational analysisA Demand analysis 1 Buyers behavior and characteristics:

a What do they buy?b Who buys?c Where do they buy?d Why do they buy? e How do they buy?f When do they buy?g How much do they buy?h How will buyer’s behavior and characteristics change in the

future?i Are customers satisfied? At what

level?j Are customers retained? At what

level? 2 Market characteristics:

a Market size potentialb Segmentsc Selective demandd Future market trends

Cont …

B Competition 1 Who are competitors? 2 Competitor characteristics:

a Marketing programsb Competitive behaviorc Resources

3 Major strengths and weaknesses 4 Future competitive environmentC General environment 1 Economic conditions and trends? 2 Government regulation and trends? 3 Pollution, safety, consumerism concerns 4 Technological trends 5 Political climateD Internal environment 1 Marketing resources / Skills 2 Production resources / Skills 3 Financial resources / Skills 4 Technological resources / Skills 5 Future trends in internal environment

Cont …

II Marketing mixA Product 1 What product attributes/benefits are important? 2 How should the product be differentiated? 3 What segments will be attracted? 4 How important are service, warranty, and so on? 5 Is there a need for product variation/product line? 6 How important is packaging? 7 How is the product perceived relative to competitive offerings?B Place 1 What types of distributors should handle the product? 2 What are the channel attitudes and motivations for handling the product? 3 What intensity of wholesale/retail coverage is needed? 4 What margins are appropriate? 5 What forms o physical distribution are needed?

Cont …

C Price 1 What is the elasticity of demand? 2 What pricing policies are appropriate? 3 How should be product line be priced? 4 How do we establish price variations for a product? 5 How should we react to a competitive price threat? 6 How important is price to the buyer? D Promotion 1 What is the optimal promotional budget? 2 How important are sales promotion, advertising, and personal selling in stimulating demand? 3 What is the proper promotion mix? 4 How do you measure the effectiveness of the promotion tools? 5 What copy is most effective? 6 What media are most effective?

III Performance measures? 1 What are current sales by product line? 2 What are current market shares by product line? 3 What are current sales/market share by customer types, sales region, and so on? 4 What is our product/company image among customers, distributors, and the public? 5 What is the awareness level of our promotion? 6 What is the recall level of our brand name? 7 What percentage distributorship do we have in large retailers? Medium? Small? By geography? Customer type? 8 What percentage of the channel is selling below suggested retail price? What is the average retail price of our product? 9 What percentage of customers are satisfied? 10 What percentage of current customers are likely to repeat?


1 Recognize a decision situation1 Recognize a decision situation

2 Define the decision problem2 Define the decision problem

3 Identify alternative courses of action3 Identify alternative courses of action

4 Evaluate the courses of action4 Evaluate the courses of action

5 Select a course of action5 Select a course of action

6 Implement and modify6 Implement and modify

Decision-makingProcess

Recognize a decision situationDefine the decision problemIdentify alternative courses of actionEvaluate courses of actionSelect a course of actionImplement and modify

Decision-makingProcess

Recognize a decision situationDefine the decision problemIdentify alternative courses of actionEvaluate courses of actionSelect a course of actionImplement and modify

Information inputs

Management experience and judgment

Marketing research system

Information inputs

Management experience and judgment

Marketing research system

Marketing systemMarketing mix Behavioral

response

Situational Performance factors measures

Marketing systemMarketing mix Behavioral

response

Situational Performance factors measures


The key role of research

Product

Promotion

Place

Price

RESEARCHRESEARCH

Internal environment

External environment

The main categories of research

Strategic Tactical

Marketing research

Marketing research

Data bank

The two-way research process

Quantitative - Objective

Quantitative - Subjective

Enquiries Information

OrganisationOrganisation

Data sourceData source

Secondary data sources

Marketing researchMarketing research

Secondary informationSecondary information

Internal sourcesInternal sources External sourcesExternal sources

Primary data sources

Marketing researchMarketing research

Primary informationPrimary information

SURVEYS

Personal / Postal / Telephone

Panel data / focus groups

SURVEYS

Personal / Postal / Telephone

Panel data / focus groups

OBSERVATION

Personal

Mechanical

OBSERVATION

Personal

Mechanical

Survey method

Advantages Disadvantages

Personal interview

Question can be modifiedIn-depth answers possibleMuch qualitative datafrom a small sampleFlexible-can allow for reaction , visual information Observation improves accuracy Rapport leads to fewer refusals.

Professional interviewers expensive Possible interviewer biasCan be slow People often not at home Invasion of privacy Disagreements can arise

Postal survey

No travel expenses, so economic if good return rate No interviewer bias Can be genuinely random Anonymous returns Can be completed at respondent’s leisure

Non-response rate high, unless questions are short , simple and not too probing Takes longer Inflexible and no observation Higher postage rates increase costs Difficult and expensive to obtain complete, up-to-date mail lists.

Cont …

Telephone survey

Easy to administer Quick No travel expenses, so cheap if local and in evenings Flexible – can allow for reaction and some in-depth answers Questions can be modified Some anonymity

Professional interviewers expensive Invasion of privacy Telephone charges can be high.No observationHard to develop trust Not genuinely random-sample limited to respondents with Non-response rate high- engaged signal/no answer/refusals

Focus group

Informality and personal rapport encourages accuracyQuestions can be modifiedCan run on a regular basisIn-depth answers reliableObservations and recording of answers and reactionsVisual details

Scope and sample limited Might not be treated seriouslyMore costly if incentives are large

Sampling methods

Sampling methodsSampling methods

ProbabilityProbability

RandomRandom ConvenienceConvenience

Non-probabilityNon-probability

Stratified or multi-

stage

Stratified or multi-

stage

ClusterCluster QuotaQuota SystematicSystematic

The chronological research process

1. Marketing dept. or manager defines background i.e. why research is necessary.1. Marketing dept. or manager defines background i.e. why research is necessary.

2. Research brief devised, including problem or opportunity to be analysed and clear statement of objectives.

2. Research brief devised, including problem or opportunity to be analysed and clear statement of objectives.

3. Exploratory research carried out.3. Exploratory research carried out.

4. Hypothesis developed.4. Hypothesis developed.

5. Research proposal and design prepared, including the method to be used / population to be surveyed/time-scale and costs/use of specialist agencies.

5. Research proposal and design prepared, including the method to be used / population to be surveyed/time-scale and costs/use of specialist agencies.

Cont …

6. Data collected – prepared/supervised/verified.6. Data collected – prepared/supervised/verified.

7. Data analysed and evaluated-significant relationships established and inter7. Data analysed and evaluated-significant relationships established and inter

8. Research presented and reported, including specific data and findings / recommendations.

8. Research presented and reported, including specific data and findings / recommendations.

The marketing information system

External and internal

information sources

External and internal

information sources

Classifying Storing

Indexing Retrieving

Classifying Storing

Indexing Retrieving

Information for marketing

decision making

Information for marketing

decision making

INPUTS PROCESSING OUTPUTS

FEEDBACK: ADJUSTING

INFORMATION INTAKE

Key elements of market selection

Segmentation

Deciding on variables and determining segments

Segmentation

Deciding on variables and determining segments

Targeting

Which targets should be targeted and when?

Targeting


Positioning

Establish product position in consumer's minds

Positioning


THE MARKETING RESEARCH ROLE IN MARKETING MANAGEMENT

Independent variables (causes)

Independent variables (causes)

Targeting


Targeting


Positioning


Positioning


Marketing / economic related

Stimuli Social/cultural and environmental

Personal and psychological

Marketing / economic related

Stimuli Social/cultural and environmental

Personal and psychological

The scope of buying behaviour

Marketing effort

CustomersCustomers

Organisational buying behaviour

Individual buyer behaviour

Decision-making units

Models of consumer behaviour

Reference group influences

Group influence of product class

Weak Strong

Strong

Weak

Public necessities:

Clothing

Furniture

Soaps

Clocks and watches

Group influence on brand type

Public luxuries:

Cars

Tobacco

Wine

Restaurant meals

Holidays

Private necessities:

Beds

Detergents

Breads and milk

Roof insulation

Soft drinks

Private necessities:

Microwave ovens

Video recorders

Television games

Instant coffee

Maslow’s hierarchy of needsStage and qualities Related products/services

Political

5.Self –actualisation

Self –fulfillment

Creativity

Development of talent

Self-awareness

5.Self –actualisation

Self –fulfillment

Creativity

Development of talent

Self-awareness

Education

Specialist hobbies

Sports

Luxury vacations

Gourmet food

Long-life products

Education

Specialist hobbies

Sports

Luxury vacations

Gourmet food

Long-life products

Cars

Housing

Material goods

Furniture

Prestige items

Books

Cars

Housing

Material goods

Furniture

Prestige items

Books

4.Self –esteem

Authority

Status and reputation

Prestige

Self-respect

Ego and confidence

Peer and community respect

Promotion and achievement

4.Self –esteem

Authority

Status and reputation

Prestige

Self-respect

Ego and confidence

Peer and community respect

Promotion and achievement

Origins

Spiritual

Cont …

LEARNED

INSTINCTIVE

Biological

2. SafetySecurity and stability

ReligionProtection

Physical well-beingFair treatment

FinanceSafe future

2. SafetySecurity and stability

ReligionProtection

Physical well-beingFair treatment

FinanceSafe future

InsuranceAlarm systems

Tyres and seatbeltsPensions

InvestmentsMedicines

InsuranceAlarm systems

Tyres and seatbeltsPensions

InvestmentsMedicines

BreadMilk

Beds and beddingHeatingLighting

Basic garments

BreadMilk

Beds and beddingHeatingLighting

Basic garments

1.Basic physiologicalAir

FoodDrinkSleep

ComfortSurvival

1.Basic physiologicalAir

FoodDrinkSleep

ComfortSurvival

Psychological

LEARNED

INSTINCTIVE

3.Social identificationAffiliation

Love and sexFreedom

BelongingRecognitionComparison

3.Social identificationAffiliation

Love and sexFreedom

BelongingRecognitionComparison

CosmeticsClothing

EntertainmentLeisure

Food and alcoholTobacco

CosmeticsClothing

EntertainmentLeisure

Food and alcoholTobacco

Sociological

Maslow’s hierarchy applied to the marketing of biscuits

Maslow’s needs stage Message to consumer

1. Basic physiological ‘Fills you up’

2. Safety

3. Social identification

4. Self -esteem

5. Self- actualisation

‘Pure through and through’

‘Join the in-crowd’

‘Special biscuit for the connoisseur’

‘Tease your taste buds with a new experience’

Information processing

AttentionAttention

ExposureExposure

ComprehensionComprehension

Yielding/acceptanceYielding/acceptance

RetentionRetention

Stimuli

MemoryMemory

The problem-solving process

Intensity of problem-solvingIntensity of problem-solving

Routine Limited Extensive

Low Medium High

Involvement, price, purchase frequency, risk, information levelInvolvement, price, purchase frequency, risk, information level

Problem recognitionProblem recognition Problem recognitionProblem recognitionStimuli

Cont …

Internal search for solutionInternal search for solution Internal search for solutionInternal search for solution

IntentionIntention Evaluation of alternative solutionsEvaluation of alternative solutions

PurchasePurchase Purchase decisionPurchase decision

SatisfactionSatisfaction Purchase actPurchase act

Post-purchase evaluationPost-purchase evaluation

Factors influencing Organisational buying decisions

EconomicBusiness conditions

Product priceTrade conditionsCommercial riskLevel of demand

EconomicBusiness conditions

Product priceTrade conditionsCommercial riskLevel of demand

InterpersonalRelationships

ConflictsCo-operation

AuthorityEmpathy

Persuasiveness

InterpersonalRelationships

ConflictsCo-operation

AuthorityEmpathy

Persuasiveness

IndividualAge

IncomeEducation

StatusPersonality

IndividualAge

IncomeEducation

StatusPersonality

MarketingProduct quality and performance

BenefitsQuantity

AvailabilityService

Selling methodsDistribution channels

MarketingProduct quality and performance

BenefitsQuantity

AvailabilityService

Selling methodsDistribution channels

EnvironmentalSocial/cultural

Laws and regulationsPolitical decisions

Competitive actionsEcological considerations

EnvironmentalSocial/cultural

Laws and regulationsPolitical decisions

Competitive actionsEcological considerations

OrganisationalPrestige

Goals/objectivesResources e.g. financialDecision-making units

Purchasing policies

OrganisationalPrestige

Goals/objectivesResources e.g. financialDecision-making units

Purchasing policies

SupplierGeographical location

Nature of suppliersPurchasing environment

ReliabilitySupplier interaction

Information exchange

SupplierGeographical location

Nature of suppliersPurchasing environment

ReliabilitySupplier interaction

Information exchange

TechnologicalRate of change

Technical featuresDesign

New product developmentProduct complexity

TechnologicalRate of change

Technical featuresDesign

New product developmentProduct complexity

Organisational decisions

Organisational decisions

The organisational buying decision process

Problem recognitionProblem recognition

Cont …

Influencing factorsInfluencing factors

Analysis of possible solution

Analysis of possible solution

Information searchInformation search

Suppliers contacted and products sought

Suppliers contacted and products sought

Product solutions evaluated

Product solutions evaluated

Monitoring and

feedback

Suitable solutions chosenSuitable solutions chosen

Terms negotiatedTerms negotiated

Purchase actPurchase act

Products and suppliers evaluated

Products and suppliers evaluated

P.E.S.T. Environmental factors

ORGANIZATION

INTERNAL

ENVIRONMENT

Political / Legal

Technological

Social / cultural

Economic

EXTERNAL ENVIRONMENT

EXTERNAL ENVIRONMENT

PEST EXTERNAL FACTORS

Political / Legal Environment – includes:

•Central and local government systems;

•Political ideologies and pressure groups;

•Financing and grants;

•Voluntary codes of practice;

•Statutory legislation

•Consumer protection measures.

Economic Environment – includes:

•Stage of the business cycle – prosperity/ recession/ depression/ recovery;

•Rate of inflation

•Unemployment rate

•Resource availability

•Income levels – total / disposable / discretionary

•Interest rates

Social / Cultural Environment – includes:•Demographic (population) and geographic trends;•Socio-economic class groups;•Status and background•Norms and values•Lifestyles and habits•Peer groups and associates; •Specific characteristics, e.g. language and practices

Technological Environment – includes:

•Technology transfer

•Innovation

•Desirable effects – living standards, leisure time;

•Undesirable effects – health hazards, unemployment, aesthetic and environmental problems;

•Short term impact

•Long term application

The competitive environment

ORGANIZATION

COMPETITIVE ENVIRONMENT

COMPETITIVE ENVIRONMENT

Competition from marketers of substitutable products or services

Indirect competition from marketers of all organizations for the consumer’s purchases

Direct competition from marketers of the same products or service

Direct competition from marketers of similar products or service

Forces Influencing Organizational Buying Behavior

Organizational Buying Behavior

Environmental forces

Organizational forces

Group forces

Individual forces

•Economic Outlook: Domestic & Global

•Pace of Technological Change

•Global Trade Relations

•Goals, Objectives and Strategies

•Organizational Position of Purchasing

•Roles, relative influence, and patterns of interaction of buying decision participants

•Job Function, past experience and buying motives of individual decision participants

Strategic Priorities in Purchasing

Strategic Priority

Modeling the Total Cost of Outside Purchases

Creating Purchasing Strategies Tied to Corporate Goals

Building and Sustaining Supplier Relationships

Integrating the Supply Chain

Leveraging Supplier Innovation

Description

Developing a clear grasp of the factors that drive the cost of purchased products and services.

Conducting a rigorous analysis of the supply industry to determine how suppliers can contribute fundamental value to corporate goals.

Structuring relationships with key suppliers to achieve mutual dependence and goal congruence.

Managing purchase and flow of materials from suppliers through production and on to customers

Creating value by bringing suppliers directly into the new product development process

Major Elements of Organizational Buying Behavior

Evoked Set of Alternatives

Environmental Constraints (Physical,

Technological, Economic, Social)

Organizational Requirements

(Technical, Financial)

Feasible Set of Alternatives

Formation of Individual Preferences

Formation of Organizational Preferences

Organizational Choice

Individual Responsibilities

Comprising the Buying Center

Sources of information

Evaluation Criteria

Interaction Structure

Values – Driven Leadership

Drivers of Sustainable Success in Service Business

Strategic focus

Executional Excellence

Control of Destiny

Trust-based RelationshipsInvestment in

Employee Success

Acting Small

Brand Cultivation

Generosity

Core Values That Sustain Service Performance

Excellence Joy

INNOVATION

Respect

TeamworkSocial Profit

INTEGRITY

Strategy Connections

Core Values

Continuous Change

Frequent Change

Rare Change

Unchanging

From Core Strategy to Total Product

Definition of Business

Design of Business

Execution

Market Offer Total Product

Core Strategy

Integrated Substrategies

Design and Execution

Performance of Individual

Activities

Whole of Customer’s Experience

with Company

Model of Trust-Based Relationships

Perceived Competence

Perceived Fairness

Trust of Company

Employee Relationships

Customer Relationships

Partner Relationships

Relationship Commitment Levels

1. Interest in Alternatives

2. Acquiescence

3. Cooperation

4. Enhancement

5. Identity

6. Advocacy

7. Ownership

The Zone of Tolerance

Desired Service

Zone of

Tolerance

Adequate Service

Investing in Employee Success

Investing in Employee Success

Strong Beginnings

Continuous Learning

Ownership Attitudes

A Service Branding Model

Company’s Presented Brand

Customer Experience with Company

Brand Awareness

Brand Meaning

Brand Equity

Cultivating Brand Equity

Brand Equity

Internalize the Brand

Dare to be Different

Determine Your Own Fame

Make an Emotional Connection

Marketing Research

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