Marketng Research

8/2/2019 Marketng Research

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OBJECTIVES OF MARKETING RESEARCH:-

1. To know the demographics and psychographics of customers:-Marketing research tries to reveal the number of persons who buy, why they

buy, when they buy, the frequency of their buying, and the sources of their

buying. It also includes the social status and the regional location of the

customers.

2. To find out the impact of promotional efforts:-A marketing research facilitates appraising and improving the methods of sales

promotion. It also leads to measure the effectiveness of advertising, pricing

policies and channels of distribution.

3. To know customer response to a new product:-This is also known as product testing. Marketing research is frequently used to

know the opinion of the customers about the, satisfaction given by a new

product. This helps in knowing the desired improvements in quality, design,size, packing, distribution method, etc.

4. To forecast sales:-Marketing research helps in sales forecasting and market planning. The

researchers make sales forecast on the basis of the response from the customers

and the distribution media.

5.

To anticipate competitive moves:-It helps the marketer to continuously monitor the competitor and judge about

the right actions that might be required. For example, the war between P&G and

HLL for their detergents included going to the court, apart from bringing new

product by improvements, getting stamp of approval from Vimal and Videocon

respectively.


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6. To probe what went wrong:-This happens when the product is having some special problems for example,

Jonson & Jonson probed into the poisoning of their capsules and found that the

customer felt very bad about the company. The company launched advertising

campaign whereby it offered to replace all the capsules, it owned its

responsibility for any injury caused to the customers, and that poisoning

happened outside their factory.

The company regained its market share and image. This was possible

because marketing research found the right media and message. Which could

change customer attitude in favour of Johnson & Johnson?


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PROCESS OF MARKETING RESEARCH:-

Effective marketing research involve the following steps involve in this steps.

The various stages in this process are:

1. Defining the problem.2. Defining research objectives.3. Working out research design.4. Deciding on the source of data.5. Planning and deciding on data collection techniques and tools.6. Analyzing data.7. Writing out the report and presenting it to the decision makers

IMPORTANCE OF MARKETING RESEARCH:-

1) USES/IMPORTANCE TO BUSINESS AND INDUSTRY:-i. Decision-making Tools:- Marketing research is useful for taking

marketing management decision it provides necessary information and

data in analyzed and processed forms for making marketing decisions.

With advanced technology, higher production function and an increasing

marketing complex, market research has become an indispensable tool for

taking appropriate decisions.

ii. Management planning:- marketing research is used for managementplanning. It deals with marketing opportunities, i.e. those opportunities

which are viable to be exploited by management. Thus, marketing

management can assess the resources that will be useful for the business.

iii. Problem solving:- starting from problem identification to formulation ofalternatives solution, and evolving the alternatives in every area of

marketing management, Is the problem solving action of marketing

research.

iv. Control technique:- marketing research is used as a control technique ofmarketing management to find out the weakness and shortcomings of the


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management decisions to reorient the planning and performance

techniques

v. Large scale production:- marketing research helps large scaleproduction by providing suitable decisions to be undertaken by the

producer to exploit the existing production resources to meet the growing

markets. The resources of production and market potentials are properly

assessed by marketing research

vi. Complex market:- the advancement of science and technology and thestandard of living of consumers necessitate closer touch with the growing

markets. The size and specialization with in the business unit and the

intervention of numerous middlemen between the manufacturers and

customers created a wide communication gap.

vii. Pattern of consumption:- The pattern of consumption is to be assessedby the marketing management. The study of buyer behaviour, attitudes

and capacity to purchase is very important in marketing research. The

purchasing power of a consumer depends upon his disposable personal

income. Thus, the total purchasing power of a country or geographical are

can be assessed by the disposable income of the place.

viii. Suitable market operation:- marketing operation decide productionfunctions, and marketing operations can be better decided by the findings

of marketing research.

ix. Marketing strategies:- marketing management has to lay downappropriate marketing strategies to meet competition to pursue growth in

market and to attain organizational onjectives.


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PROBLEM DEFINITION

RESEARCH OBJECTIVES

RESEARCH DESIGN

SOURSE OF DATA

DATA ANALYSIS

PRIMARY SECONDARY AND ADVANCEDREPORT AND PRESENTATION

DATA COLLECTION


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DEFINING THE PROBLEM:-

Under the marketing research, before understanding the study of any

problem, it becomes necessary that a clear-cut definition of the problem be

known. Without the definition of the problem, no strong and proper plan could

be drawn up of the marketing research. Unless we decide the subject of our

research, it is useless to hope for good results. For a good result of the

researches, it is also essential that whatever data be gathered, their should be

unbiased and reliable. For it is essential that the source of informations be

widely examined or tested. Many a times, due to the drawbacks of the sources

of information, proper conclusions are not drawn out of the research.

STATEMENT OF RESEARCH OBJECTIVES:-

Once the problem is defined, the next logical step is to state what the researcher

wants to achieve. This statement is called objectives. To be meaningful and help

focus the researchers attention, this objective should be specific, attainable andmeasurable. In the distribution example above, the researcher laid down the

objectives are follows:-

(a)To determine the market penetration of the company and its competitorsin metros and other urban cities, by collecting data on the number of

outlets exclusively keeping the companys or its competitors products and

outlets keeping both company and competitors products.


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(b)To determine the ratio of brands sales to industry sales (extraction) thatthe company got from different retail outlets selling its own and its

competitors brands and.

(c)To assess the motivation level of channel members and evolve andincentive plan for enhancing it.

All these three objectives emanate from the problem definition. Also, these are

measurable and attainable and they are specific.

The purpose of these objectives is to act as a guide to the researcher and help

him in maintaining a focus all through the research.

RESEARCH DESIGN:-

The third stage in the marketing research process is deciding on the research

design. There are three types of research designs, namely:

(a)Exploratory(b)Descriptive(c)Causative

(a)Exploratory Research:-Exploratory research is conducted when the researcher does not know how and

why a certain phenomenon occurs, for example, how does the customer

evaluate the quality of a bank or a hotel or an airline? While in the case of a

manufactured product, quality is the assessed on the basis of tangible features,

replacement policy, warranty, etc. In the case of services, there are notangibles. To understand this phenomenon, several researchers have conducted


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focus group discussion to identify these quality parameters, for example,

Zeithaml, Parsuraman and Berry identified variables which they clubbed under

five groups. In doing so, they used focus groups.

Since the prime goal of an exploratory research to known the unknown, this

research is unstructured. Focus groups, interviewing key customer groups.

Expert and even search for printed or published information are some common

techniques.

(b)Descriptive research:-Descriptive research is carried out to describe a phenomenon or market

characteristic. For example, a study to understand buyer behaviour and

describe characteristics of the target market is a descriptive research.

Continuing the above example of service quality, a research done on how

customers evaluate the quality of competing service institution can be

considered as an example of descriptive research, likewise, research done on

media habits and T.V. viewing habits is an illustration of descriptive research.

Generally, descriptive research is carried out only when the researcher

understand the phenomena or behavioural characteristics.

(c)Causative research:-Causative research is done to establish a cause and effect relationship, for

example, the influence of income and lifestyle on purchase decision. Here the

researcher may like to see the effect of rising income and changing lifestyle on

consumption of select products. He/she may test the hypothesis that as income

increases are likely to be bought. Or in other words, choice of technology is a

function of the customers income and lifestyle. Likewise, a firm may like to

test the effect of a 10% raise in its products prices. In a causative research,

unlike exploratory or descriptive, hypotheses are tested.

Hypothesis is a statement of predicted outcomes of the research. In building up

a hypothesis, it is important that the researcher understand the phenomena

thoroughly, or a body of research that exists on the subject matter.


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SOURCES OF DATA:-

Once the research design has been decided upon, the next stage is that of

selecting the essentially, there are two sources of data or information-

Secondary and Primary.

(a)Secondary data:-This refers to information that has been collected earlier by someone else.Often this includes printed or published reports, news items, industry or

trade statistics, etc. This also includes internal documents like invoices, sales

reports, payment history of customers, dispatch records, etc. These are

important to the researcher as they provide an insight to the problem. Often

the preliminary investigation is restricted to secondary data. It may be

understood here that often this data includes information on competition,

customers etc.

(b)Primary data:-Primary sources refer to data collected directly from the market place-

customers, traders and suppliers often are the major sources. They are often

reliable data sources and help in overcoming limitation of secondary data.

The problem in primary data is its cost, both in terms of money and time,

and often a researcher bias also creeps in. However, not with standing these


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limitations, primary sources are important and more than 90% of marketing

research involves one or the other part of this primary data search.

DATA COLLECTION:-

The researcher is now ready to take a plunge. But still he or she needs to be

clear about the:

Procedure of data collection-

Primary Data can be collected through any or combination of the following

techniques.

(1) Observational research: This technique involves observing what acustomer is buying and doing in the store. Also it involves observing how a

customer behaves in the shopping area; how he or she dresses up and what

do the customer say when he or she sees the product. Closed video

monitoring is a very common technique being used today by major dealer

shows shops and other retail outlets.

Other example fresh data can be gathered by observing the relevant

actors and settings. The American airline researchers might meander around

airports, airline offices, and travel agencies to hear how travellers talk about

the different carriers. The researchers can fly on American and competitors

planes to observe the quality of in-flight service. This exploratory research

might yield some useful hypothesis about how travellers choose air carriers.


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(2)Focus group research: A focus group is gathering of six to ten people whoare invited to spend a few hours with a skilled moderator to discuss a

product, service, organization, or other marketing entity. The moderator

needs to be objective, knowledgeable on the issue, and skilled in group

dynamics. Participants are normally paid a small sum for attending. The

meeting is typically held in pleasent surroundings and refreshments are

served.

Focus group research is a useful exploratory step. Consumer goods

companies have been using focus groups for many years, and an increasing

number of newspapers, law firms, hospitals and public service organizations

are discovering their value. However, researcher must avoid generalizing

the reported feelings of the focus group participants to the whole market,

because the sample size is too small and the sample is not drawn randomly.

With the development of the World Wide Web, many companies are now

conducting on-line focus groups.

(3)Experimentation: this is a technique that involves experimenting newproduct ideas, advertising copies and campaigns, sales promotion ideas and

even pricing and distribution strategies with the target customers group.

(4)Survey research: The most common procedure is the survey. Here theresearcher carries out opinion polls involving customers, sales persons,

dealers and experts. Also customer and trade survey are very common. In

conducting these surveys, the researcher has to carefully select the

instruments and methods of surveying. These methods are postal surveys,

telephone surveys, personal contacts.

Tools of data collection

The researcher has to decide on the appropriate tools for data collection.These tools are:


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(1)Questionnaires : A questionnaire consists of a set of questions presentedto respondents for their answers. Because of its flexibility, the questionnaire

is by for the most common instrument used to collect primary data.

Questionnaire need to be carefully developed, tested, and debugged before

they are administered on a large scale.

In preparing a questionnaire, the professional marketing researcher

carefully chooses the questions and their form, wording, and sequence. The

form of the question asked can influence the response. Marketing researcher

distinguish between closed-end and open-end question. Closed-end

questions prespecify all the possible answers. Closed-end questions provide

answer that is easier to interpret and tabulate. Open-end questions oftenreveal more because they do not constrain respondents answers. Open-end

questions are especially useful in exploratory research, where the researcher

is looking for insight into how people think rather than in measuring how

many people think a certain way.

(2)Interview Schedule: At times a questionnaire is not able to give an insightinto the rationale of a customers feeling, or factors that will lead to success

of a few technology like e-mail and voice-mail or new products that a firmmay consider introducing. It is for these and several similar reasons that an

interview schedule is developed. The purpose of this schedule to study in-

depth an object, an event, or a group of people unlike a questionnaire the

responses are unstructured, unlike a questionnaire.

(3)Association tests Recently, the researchers focus has been on thequalitative research, or researching the psychological dimension of

consumer behaviour. In most direct questioning, using the questionnaire or

an interview schedule, the respondent is generally guarded and givesresponse? More from the conscious part of his or her psyche. To get to, the


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sub-conscious part, marketing researchers are using several psychological

instruments like association tests, sentence completion tests and thematic

appreciation tests (TAT). These tests are believed to reveal the customers

perception of a product or brand or firm image also these tests can give

information on customers perception of brand personality as also the

personality and life style of target customer group.

DATA ANALYSIS:-

The next-to-last step in the marketing research process is to extract findings

from the collected data. The researcher tabulates the data and develops

frequency distribution. Averages and measures of dispersion are computed

for the major variables. The researcher will also apply some advanced

statistical techniques and decision models in the hope of discovering

additional findings.

REPORTS AND PRESENTATION:-

The last stage is that of writing out a report and making a presentation to thedecision-maker. It is important that the report has a summary, called the

executive summary, giving a birds eye view of the research and major

recommendation. This is because; most senior managers have little time for

going through the entire report in depth. The execution summary can direct

the leaders attention to specify issues and recommendations. Depending on

his or her interest, the decision-maker goes in to the details of those issues by

turning to the relevant sections in the report. This summary should generally

not exceed a thousand words.

The report should be structured and pages chronologically numbered.

Generally, the structure of a good report is somewhat like the following:

i. Introduction to the problem. State here the problem, the environmentalcontext, objectives, sample size, stratification and sampling procedure

adopted, tools for data collection, source of data, and data analysis

tools,

ii. Marketing research findings or survey findings. Present here all themajor findings,


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iii. Interpretation of research findings,iv. Policy implication. Often the decision maker may want the researcher

to present the findings. For this it is important that he prepare his

slides or transparencies of only major findings and he hold interest of

decision makers, narrate experiences that he or she may have heard or

had while collecting the data. But these experiences should relevant

and support the research findings. Remember humanizing data can

often make an interesting presentation and keep an audience tuned into

the marketing researcher.

SCOPE OF MARKETING RESEARCH:-

Marketing research covers different aspect of marketing of goods,

services and ideas. There are many areas of marketing management where

marketing research has special branches.

(1)Product research- Product research is associated with the conversion ofcustomer needs into tangible product offer. This includes development and

testing of new products, improving the existing products, and a tab on the

changing customer preferences, habits, tastes, etc. Packaging design,

branding and labelling decision are also included here. For example, Ponds

tested its Pnnds Toothpaste, but it did not launch the toothpaste with the

same package as used in the concept test and test marketing. The result was

marketing failure of the product because the actual ponds toothpaste waswith pink floral package which consumer perceived to resemble taking of

talcum powder into their mouths.

(2)Customer Research- This research type includes investigation into thecustomer buying behaviour the economic, social, cultural, personal, and

psychological influences. For example, when Rasna concentrate was

launched, it was targeted at the mothers. But sales did riot pick-up. Then,

the targeting was changed to include the child as influencer of mothers


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decisions to prepare Rasna for him. The sales graph picked-up and today it

ruling the category.

(3)Sales Research- Sales research involves decisions concerning selection ofstore location, channels, territories, sales force motivation and

compensation, etc. The purpose is to reach the target customer more

effectively, efficiently and timely. For example, when Volform sauce was

launched by voltas, it was heavily advertised and people were tempted to

reach outlets. However, the retailers had not been provided with the product

by that time.

Poor sales research resulted into marketing failure of he product. Later on,

when Volform reached distribution channels, there was less promotional

support and therefore people were, this time, unwilling to move to the retail

outlets thanking that the product would not be available.

(4)Promotion Research- Promotion research encompasses all efforts by themarketers to communicate the companys offer. This includes advertising,

publicity, public relations, sales promotion, etc.

Today, most of the products are advertising through sponsorship

(Videocon independent cup, pepsi asian cup, Philips top 10, chutki baja ke

(fevikwik), etc.) or launched through events (Bharti telecom.) launched its

cellular phone service in Delhi through staging a play before select

audience; Microsoft-launched Window 95 by carrying out spectacularevents in 53 countries around the world). On sales promotion, the trend is

towards offering freebies, exchanges, interest-low consumer finance, etc.

All these are possible after conducting extensive research to ensure success

of the particular campaign.

Product

research


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methods of the working of these competitors. By market research, help is

available in successfully facing the competition.

(4)Production and sates PlanningBy the market research, forecast could bemade regarding the demand of the consumers by which much help could be

possible in formulating the plans regarding the production and sales.

(5)Knowledge of consumers Reactions By the market research, theknowledge could be procured with regard to the reaction of the consumers

about the particular product. After gelling the knowledge regarding the

reaction of the consumers, in view of their desires of likings, necessary

changes could be effected in the quality and kind of the product, its weight,

packing, design, price, etc.

(6)Discovery of the New market of the Product By the market research,information is available regarding the new markets and customers of the

product. In these new markets, for promoting the sales of the product,

necessary steps may be taken up.

(7)Reducing the Risk If any producer, with the help of market research,manufactures the products keeping in view the taste and temperament,

fashion, etc. Of the consumers, or plans the production of the item, there

doesnt remain any risk with regard to the sale of the product.

(8)Increase In the Standard of Living By the market research, due to theenhancement in the demand and production, the cost could be reduced and

the consumers would be able to get the products on cheaper prices which

might ultimately lead to an advancement in the standard of the living of the

consumers.


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LIMITATIONS OF MARKETING RESEARCH

Marketing research may suffer from the following limitations:-

(1)Huge expenditure:- Marketing research involve huge expenditure ofmoney, efforts and time on the collection and analysis of data. Small firms

cannot afford marketing research.

(2)Bias in collecting data:- The effectiveness of marketing research dependslargely on the types of data or information collected. The subjectivity of the

investigators may have adverse effect on the effectiveness of the marketingresearch.

(3)Unpredictable Human Behaviour:- Marketing research is mainly a studyof the behaviour of human beings. The individuals may not always give

adequate and accurate data. Thus, the results of the marketing research are

not cent percent accurate.


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(4)Requires Intelligent Handling:- Marketing research is not an end in itself.It is a means to decision-making. It requires competent and experienced

executive or managers to use the result of marketing research.

(5)Supplementary, Not Substitute: Marketing research is not a substitute forexecutive judgement. It only provides relevant information with the help of

which executives can take decisions regarding product, pricing, promotion,

place, packaging, etc.

(6)Requires Competent Researcher:- Marketing research may lead theexecutive to wrong results because of carelessness of the research staff. If

the investigators are not competent to collect right type of data and analyze

it accurately, there will be no utility of marketing research.

(7)No Time Gap Allowed Between Research and its Implementation:-There is generally a time lag between marketing research and the

implementation of its findings. During this period, business conditions

might change making the market research a futile exercise.

Marketng Research

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