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Marketing Chapter 5 Marketing Research: Information and Technology Gilbert A. Churchill, Jr. J. Paul Peter Slide 5-1 Marketing Research Definition The function that links the consumer, customer, and public to the marketer through information. The process of planning, collecting, and analysis of data relevant to marketing decision making. The process of designing, gathering, analyzing and reporting of information that may be used to solve a specific marketing problem. The systematic and objective process of generating information for aid in making marketing decisions. Slide 5-2 Table 5.1 Questions Marketing Research Can Help Answer Questions about Markets Buyers Demand Channels What kinds of people buy our products? Is demand for our products increasing or decreasing? Do channels of distribution for our products need changing? Questions about Marketing Mix Product Pricing Placement Promotion Which product design is likely to be most successful? What price should we charge for our new products? Where, and by whom, should our products be sold? How much should we spend on promotion? Questions about Performance Market Share Customer Satisfaction Reputation What is our market share overall? Are customers satisfied with our products? How does the public perceive our organization? Slide 5-3 Figure 5.1 Basics of a Marketing Decision Support System Data in Database Models in Model Base Dialogue System Information Data used to make decisions A coordinated collection of data, system tools, and techniques with supporting software and hardware by which an organization gathers and interprets relevant information and turns it into a basis for making management decisions. Slide 5-4 Primary Data Advantages • Up-to-date • Directly Relevant • Known Source Disadvantages • More Expensive • More Time Consuming Types • Observation • Survey • Experimental Data collected specifically for the purpose of the investigation at hand Slide 5-5 Secondary Data Advantages • Less Expensive • Requires Less Time Disadvantages • May Be Obsolete • May Not Be Relevant Types • Internal • External Data collected for some purpose other than the immediate study at hand Slide 5-6 Sources of Secondary Data Source Description Internal Information Sales Invoices, Accounting Records, Previous Market Research Market Research Firms Companies Such As A.C. Nielsen, Arbitron, IMS International, Prizm Trade Associations Associations Such As National Industrial Conference Board, National Retail Merchants Association University Research Bureaus, Variety of Nonprofit Organizations Professional Associations, Foundations Commercial Publications Advertising Age, Sales Management, Product Marketing, Buying Power Index Government Data Federal Government publications such as Census of Housing, Census of Manufacturers, Economic Indicators Slide 5-7 Table 5.3 Information Available from the Population Census Population Household relationship Sex Race Age Marital status Hispanic Origin Education - enrollment and attainment Place of birth, citizenship, and year of entry Ancestry Language spoken at home Migration Disability Fertility Veteran status Employment and unemployment Occupation, industry and class of worker Housing Number of units in structure Number of rooms in unit Unit owned or rented Vacancy characteristics Value of owned unit or rent paid Source of water and method of sewage disposal Autos, light trucks and vans Kitchen facilities Year structure built Year moved into residence Number of bedrooms Shelter costs, including utilities Condominium status Plumbing Telephone Slide 5-8 Figure 5.3 Steps in the Marketing Research Process: Step 1 Formulate the Problem Plan a Research Design Collect Data Analyze and Interpret Data Prepare the Research Report Slide 5-9 Figure 5.3 Steps in the Marketing Research Process: Step 2 Formulate the Problem Plan a Research Design Collect Data Analyze and Interpret Data Prepare the Research Report Slide 5-10 Basic Research Designs Initial research conducted to clarify & define the problem and generate hypotheses Exploratory Research (Unaware of Problem) Research designed to describe characteristics of a population Descriptive Research (Aware of Problem) Research conducted to identify cause-and-effect relationships among variables Causal Research (Problem Clearly Defined) “Our sales are declining and we don’t know why.” “What kind of people are buying “Will buyers purchase more of our product? Who buys our our products in a new package? competitor’s product?” “Would people be interested in our new product idea?” “What features do buyers prefer in our product?” The plan for how to collect and analyze data “Which of two advertising campaigns is more effective?” Slide 5-11 Figure 5.3 Steps in the Marketing Research Process: Step 3 Formulate the Problem Plan a Research Design Collect Data Analyze and Interpret Data Prepare the Research Report Slide 5-12 Observational Research Mystery shopping The collection of data by recording the actions of consumers or events in the marketplace One way mirror Shopper Patterns Physical trace evidence Common Forms of Observational Research Traffic counters Physiological measurement People Meters Slide 5-13 Survey Research In-Home Interview The researcher interacts with people to obtain facts, opinions, and attitudes Mall Intercept Telephone (Interviewer) Telephone (Central) Common Forms of Survey Research Focus Group Interview One-Time Mail Survey Mail Panel Surveys Slide 5-14 Figure 5.3 Steps in the Marketing Research Process: Step 4 Formulate the Problem Plan a Research Design Collect Data Analyze and Interpret Data Prepare the Research Report Slide 5-15 Analyze and Interpret Data Data Sample Sampling Error Descriptive Statistics Census Key Terms and Concepts Statistical Inference Probability Sample Nonprobability Sample Coding Editing Slide 5-16 Figure 5.3 Steps in the Marketing Research Process: Step 5 Formulate the Problem Plan a Research Design Collect Data Analyze and Interpret Data Prepare the Research Report Slide 5-17 Application of New Technology • Geographic Information System (GIS) is a term used when we combine various kinds of demographic data with geographic information on maps. • Electronic Data Interchange (EDI) is the term used when one company’s computer systems is integrated directly with another company’s proprietary computer system. • Technical-market Research is research incorporating customers by demonstrating a product in 3-D on a computer screen and asking customers to evaluate it. • Usenet is a network of Internet addresses for electronic mail. Slide 5-18a Table 5.5 Areas of Ethical Concern in Marketing Research Area of Concern Example Ethical Standards Preserving participant’s anonymity Keeping the names of survey This is a basic standard of respondents anonymous, even ethical research/ though the client would like to use them to create a mailing list Exposing participants to mental stress Arriving late for a scheduled interview; conducting experiments in which subjects are embarrassed at their lack of knowledge about products When stress is unavoidable, researcher should debrief subjects afterward. Asking participants questions against their self-interest Asking about the acceptability of various prices in order to plan a price increase Such issues tend to place ethical standards in conflict with technical standards for accurate research. Using special Using equipment to measure equipment and physiological responses to a techniques product or promotional message These must be properly maintained to avoid injury. Slide 5-18b Table 5.5 Areas of Ethical Concern in Marketing Research Area of Concern Involving participants in research without their knowledge Using deception Using coercion Depriving participants of their right to selfdetermination Example Ethical Standards Secretly observing the behavior of Informed consent is a basic shoppers ethical standard unless minimal risk to subjects is involved and the research could not be practically carried out with consent. Showing subjects sample Incompletely informed consent advertisements without telling is considered ethical only if them that they will have to take there is minimal risk to a recall test afterward subjects and research cannot be practically carried out another way. Harassing by repeatedly Coercion is unethical and requesting telephone interviews tends to bias results. Changing participants in ways Researchers should try to they could not expect, such as a restore participants to their taste test in which they cannot original condition when this identify their preferred brand and occurs. unexpectedly lose confidence in their ability to judge Source: Adapted from Gilbert A. Churchill, Jr. Basic Marketing Research, 3rd ed. (Fort Worth: The Dryden Press, 1996), pp.67-71. © 1992 by the Dryden Press, reprinted by permission of the publisher.