Download Marketing Information and Research

Marketing
Information and
Research
Unit 5
Starting with Information
• You must have information about your market
before can start the marketing planning process
• Competitive and economic factors facing
businesses today increase the need to gather and
study information.
Marketers Need to
Understand….
• Consumer Differences
o Most consumers have very different needs and wants
o Most consumers will likely view product and service choices quite
differently
o Businesses must be able to determine the similarities and differences
among market segments
• Decide how they can best meet the unique needs and wants of
those segments
• Expanding Choices
o Customer needs are changing
o Consumers are able to satisfy basic needs more easily than in the past
o They have moved beyond satisfying basic needs and are devoting more
resources to satisfying their wants
Marketers Need to
Understand…
• Competition
o Gathering information about competitors’ products mad marketing
activities in order to determine their strengths and weaknesses will make a
business more competitive
o Decision makers need information that enables them to make the best
and most profitable product and service choices
• Ones that will improve on competitors’ offerings
• The Global Marketplace
o Gathering information about the country and its
people as well as new competitors can help determine
how to become an effective global business.
Decide on Information
Needs
• Approaches to Planning
o How do you know whether a change in the marketing mix is warranted?
o Are you basing the need for change off of a hunch or based off of
factual data?
• Categories of Information
o Each type of business needs specific information
• General categories:
o Consumers
o Marketing mix
o Business environment
Consumers
• Age
• Gender
• Income
• Education
• Family size
• Occupation
• Attitudes
• Primary needs
• Purchase frequency
• Brand preferences
• Information needs
• Media preferences
• Shopping behavior
Marketing Mix
Business Environment
• Basic products
• Product features
• Services
• Product packaging
• Guarantees
• After-sale customer
service
• Product price
• Discounts
• Location and method
of sale
• Type of distribution
used
• Promotion and sales
methods
• Promotional message
• Promotional media
• Type of competition
• Competitors’
strengths
• Competitors’
strategies
• Economic conditions
• Government
regulations
• Consumer protection
• Ethical issues
• Tax policies
• Proposed laws
• International markets
Collecting Information
• There are many ways to collect information
• But why?
o Effective marketing information improves the decisions of businesses
o Effective marketing information reduces the risk of decision making
• If businesses can make better decisions…
o It will increase the chance of making a
profit
o Therefore, any time or money spent
gathering information is considered a good
investment
Activity
• Your marketing research team works for a local
movie theater. Your goal is to increase the number
of moviegoers and the average amount each
customer spends on concessions.
• Determine 3 specific types of information you will
need for each category:
o Consumers, marketing mix, and business environment
• Decide why each type of information is needed.
• Create a presentation (min. 4 slides)
Activity Example
• If my goal was to increase the number of people
that shopped at ABC’s Sporting Goods:
• Consumers
o Shopping Behavior
• Preference for a particular retail price format (every day low price) vs.
promotional price
• Inclination to switch stores
o Age
• To determine if there is a large enough market in this community to
support your store
• To determine what promotional methods and ideas you will use to
attract customers
o Brand Preferences
• To ensure your store stocks the preferred brands of you target market
• How can we use brand preference to make our store more profitable?
Sources of Market
Information
• Process for determining what information is needed
and where to obtain it:
o Identify the types of information needed
o Determine the available sources of each type of information
o Evaluate each source to determine if it meets the organization’s needs in
terms of accuracy, time detail, and cost
o Select the sources that best meet the identified needs
o Enter the information into a marketing information system
Internal Information
Sources
• Internal information: information developed from
activities that occur within the organization
• Businesses keep detailed records on production
schedules and inventory levels
• Example: Salesperson learns a lot from current and
prospective customers
o Perceptions of price, satisfaction with services, or requested changes to
the company
• 3 categories of important types of internal info.:
o Customer records & sales info., production & operations reports, &
performance info.
Customer Records & Sales
Information
• Companies keep a record of all transactions they
have
o They record what is purchased, the dates of purchase, & quantities
purchased
o Detailed information of payments and credit is also recorded
o Problems and complaints are also a part of their
records
• When customers stop buying the
product, this info. Should not be
discarded
o Should be analyzed to determine why the customer was lost
Production & Operations
Reports
• Products and services must be available when and
where customers want them
• Quality standards need to be met
• Expenses need to be controlled in
order to price products/services
competitively
• Info. about production and operations activities
needs to be collected & shared regularly
o Info about sales, costs, inventory levels, and production an delivery
schedules
Performance Information
• The success of a business is judged by its
performance
• There are other performance measures than profit
o Sales, costs, quality, and customer satisfaction
• Performance is measured in three ways
1. Records of past performance
2. Compare performance with similar businesses
3. Comparison of actual performance with expected or planned
performance
External Information
Sources
• External information: provides an understanding of
factors outside of the organization
• Marketers cannot plan effectively without
understanding consumers, competitors, the
economy, and other changes around them
• There are many valuable sources of external
information
External Sources
• Government Reports
o Supplying info. that businesses and consumers can use
o There are a number of agencies that collect marketing information
• U.S. Bureau of Census
• Trade and Professional Associations
o Organized to serve people and businesses with common interests
• Members may be part of the same industry or job categories
o Information may be published through websites, journals, newsletters, or
detailed research reports.
External Sources
• Business Publications
o Magazines and journals
• The Wall Street Journal, Forbes, Business
Week
• Black Enterprise, Fast Company,
E-Commerce Times
o Gives current information on the economy,
legislation, new technology, or business ideas
• Commercial Data and
Information Services
o Businesses that collect, analyze, and sell data
• Experian, Equifax, and TransUnion
(three major credit reporting agencies)
Marketing Information
Systems
• MkIS: an organized method of collecting, storing,
analyzing, and retrieving information to improve the
effectiveness and efficiency of marketing decisions
• Each business develops its own MkIS.
• Has to be complete, accurate, easy to use, timely,
affordable, and cost-effective.
• All effecting MkIS contain five elements:
o Input, storage, analysis, output, and decision making
The 5 Elements of an
MkIS
• Input—Information that goes into the system for
decision making
o Routine information that is collected about customers,
competitors, and business operations all used for marketing
decisions
• Storage—Resources used to maintain info. so that it
can be used when needed
o If info. is lost or damaged it is not useful
o Some information is very confidential—only
authorized people should have access
o Should be organized so information is
easy to locate when needed
Five Elements Cont.
• Analysis—Process of summarizing, combining, or
comparing information
o Example: in order to plan a promotional budget, a manager may
examine the budgets for other products or for past years
• Output—The result of analysis given to decision
makers
o Most important part of an MkIS
o Usually written information or graphics
o Should be well organized and easy to understand
• Decision Making—The purpose of an MkIS is to
improve decision making
o Includes who is involved in the decision, when decisions need to be
made, and policies or procedures that should be considered, & info
needed
Activity
• Search the internet to find 3 examples of external
information and provide a description of each
• Example:
o U.S. Census Bureau reports (statistical Abstract of the U.S.)
• Is the authoritative and comprehensive summary of statistics
on the social, political, and economic organization of the
United States.
o The CIA World Fact Book
• Provides information on the history, people, government,
economy, geography, communications, transportation,
military, and transnational issues for 267 world entities.
Marketing Research
• Marketing research—a procedure designed to
identify solutions to specific marketing problems
through the use of scientific solving
o The scientific method is used to ensure that a careful and
objective procedure is followed in order to develop the
best possible solution
Using Marketing
Research
Implementing a Marketing Strategy
1. Define the problem
2. Analyze the Situation
3. Develop a Data Collection Procedure
4. Gather and Study Information
5. Propose a Solution
See the Problem Clearly
• Define the problem
o Clearly and carefully define the problem
o This is not always easy
o It is important to prepare a written statement of the
problem and have several people review it to make
sure it is understandable
o The problem should be scientific enough to
study whom to involve in the study, and the
types of solutions or results
Analyze the Situation
• An important part is to understand the
circumstances surrounding the problem well
enough to determine how to solve it
• Analyzing the situation allows the researcher
to identify:
o What is already known about the
problem,
o The information available, and
o Possible solutions already
attempted
Develop a Data-Collection
Procedure
• What additional information is needed and how
should it be collected
• The researcher needs to know where to obtain
information and the best and most efficient ways to
obtain information
o Primary Data—Information collected for the first time
• Collected by the researcher with a specific goal in mind
• Surveys, focus groups, in-depth interviews, or through experiments
o Secondary Data—Information already collected for another
purpose
• Should come before collecting primary data.
• Secondary data is cheaper and quicker to collect than primary data
and can be more accurate.
Last Two Stages
• Gather Information
o Select the participants
• Population—all of the people in the group the company is interested
in studying
• Sample—a smaller group selected from the population
o Collect data, analyze the data, prepare results,
• Propose a Solution
o Research reports—usually prepared orally and in writing
• Effective communication is an important skill
o Presenting research results
• In a written report the results reported in tables, charts, and graphs
that all have brief explanations
Activity
• Applying the principles of the scientific method to a
personal scenario
• ..\Activities\Chapter
5\Marketing_Scientific_Method_Activity.doc
Collecting Primary Data—
Conducting Surveys
• Survey—a planned set of questions to which
individuals or groups of people respond
o Surveys can be oral or written
o People can be surveyed in person, through e-mail, phone, or
online
• Closed-ended questions—offers two or more
choices
o
o
o
o
“yes” or “no”
“agree” or “disagree”
Select A, B, C, or D
Scale of 1-10 where 10 is excellent and 1 is very poor
Surveys Cont.
• Open-ended questions—allows respondents to
develop their own answers
o When making purchases from a specific farmer/producer at a
farmers’ market, what features do you find most appealing?
o What is your primary motive in attending this farmers’ market?
• Open-ended questions are often used when
researchers are attempting to identify the
problem
• Researchers may discuss the problems with
consumers using open-ended questions
Making Observations
• Observations—collects information by recording
actions without interacting or communicating with
the participant
o The purpose of observation research is to see the actions of
participants rather than have them recall or predict their actions
• Using observations requires more time and expense
than surveys
o Observations must be carefully planned in order to keep from
changing the participants actions
• If people know they are being watched the may do
things differently
Performing Experiments
• The most precise and objective information is
obtained through experimentations
o Experiments are carefully designed and controlled situations in
which all important factors are the same except the one being
studied
o Research is done by planning and implementing experiments
and then recording and analyzing the data
• Marketers use experiments to determine whether
changes in a single element of the marketing mix
will affect customer behavior
Test Markets
• Test markets—specific cities or geographic areas in
which marketing experiments are conducted
o The test markets are selected because they reflect consumer and
competitive characteristics important to the company
• The companies try new product ideas or make
marketing changes to the test markets
o They collect data on the product performance for a period of
several weeks or months and compare it with previously gathered
information
• This way they can attempt to predict the
performance in the total market
Simulations
• Simulations—experienced where researchers
create the situation to be studied
o Examples: a business may want to see how children respond
when playing with a toy
o So rather than observing children playing in their homes or
schools, they create a play center
o In the play center they bring children in and observe them under
more carefully controlled circumstances
• Many simulations are done on computers, which
allows participants to visualize a change and react
to it
Activity
• Create a survey about one of the following:
o
o
o
o
o
Athletic shoes with attached in-line skates
Peanut-butter-and-jelly flavored potato chips
Electric powered scooter
Shower sponge shaped like a microphone
Soda can with a handle
• Survey must have a minimum of 10 questions—using
a variety of question types