Marketing Research Process

1. Formulate Problems 6. Research Report - Specify Research Objectives

2. Research Design 5. Data Analysis - Exploratory, - Interpretation Descriptive, Causal

3. Data Collection Method 4. Sample Design -Primary, secondary - Sampling frame, -Questionnaire Design sample selection, -Attitude Measurement sample size

Perceptual Mapping: Overview

• How do consumers evaluate products?

• What is a perceptual map?

• How to use perceptual maps?

• How to construct perceptual maps?

Product Evaluation

What is the main difference between these two brands?

Newspaper: 1. SCMP 2. Ming Pao

Supermarket: 1. ParkNShop 2. Wellcome

Car: 1. Volvo 2. Honda

Transportation: 1. MTR 2. Taxi

Product Evaluation

Only certain dimensions are keys in comparing products.

• Breakfast Snack: glazed donut, toast, muffin, etc. 1. Easy to Prepare 2. Sweetness

• Pain reliever: Tylenol, Advil, Dartil, etc. 1. Gentleness 2. Effectiveness

• Soft drink: Coke, Pepsi, 7up,Diet Coke, Diet 7-up. 1. Cola - noncola 2. Diet - nondiet

What is a Perceptual (Positioning) Map?

• Represent consumer perceptions and preferences spatially by means of a visual display.

• Axes represent underlying dimensions that respondents use to form perceptions and preferences of brands.

Ford Taurus

Pontiac Grand Am

Chevrolet Corsics Buick Century

Toyota Camry

Honda Accord

Ford Thunderbird

Ford Tempo

Perceptual Map: Soft drink

Sprite

7 Up

Coke Diet Coke

Pepsi Diet Pepsi

Use of Perceptual Maps

• New product testing: perception of a product concept.– Test whether new product concept achieved

intended positioning.– Example: breakfast concept intended to compete

with donuts.

• New product development: directions for R& D efforts.– Needs information on “ideal point”, that is, what

feasible point on the map represents ideal combination of attributes for different customer groups.

– Example: Pain reliever, children’s Tylenol.

New Product Testing: Breakfast

Easy to Prepare

Glazed Donut Corn Muffin and Butter Jelly Donut Coffee New Cake Concept

Sweetness Toast, tart

Butter Toast & Jelly

Example: Pain Reliever

Competing brands: Tylenol, Extra Strength Tylenol, Datril, Generic acetaminophen, Bufferin, AdvilThree main segments: 1. Kids < 5 years old; 2. 20 – 40 years old; 3. 60 – 80 years old.

Ideal points: ideal combination for consumers.Brand Choice: A consumer chooses the product closest to her

ideal point

Question: a. which brands should do best in sales? b. any opportunities for new products?

Pain RelieversGentleness

Effectiveness

Tylenol

Extra-strength Tylenol

Advil

Dartil

Age: <10Use: fever

Age: >60Use: arthritis

Age: 20 ~ 40Use: Aches

How to construct perceptual map?

Method one: attribute-based ratings.Step 1: Identify list of attributes, and obtain ratings on

each attribute.Step 2: Use factor analysis to identify key attributes and

calculate ratings on key attributes. Use: industrial products, and consumer products with

explicit attributes like computers, cars and mobile phone.

Method two: similarity-based ratings.Step 1: measure similarity between pairs of brands. Step 2: use Multi-dimensional Scaling (MDS) to identify

key attributes and computer ratings on key attributes.Used for consumer products without explicit attributes

such as perfume, shampoo, beer,

Perceptual Mapping: Summary

• Consumers evaluate products based on key attributes.

• Perceptual map represents consumers’ quality perception on a spatial map.

• Perceptual maps can be productively used to test new products and identify opportunity for new products.

• Perceptual maps are constructed with factor analysis or multi-dimensional scaling.