Chapter 2

1. The Role of Marketing Research

Marketing research offers value to businesses on many fronts. Market research is very useful
to assess the needs and wants of consumers and can reduce the risk associated with
marketing decision-making.

Marketing research is vital for investigating the effects of various marketing strategies before
or after they have been implemented. Marketing research takes time and resources but it is
extremely valuable.

Market research can:

- Help identify problems and evaluate strategies
- Help assess the effectiveness of an advertising campaign
- Offer essential feedback from a test market
- Assist in identifying competitors

The Marketing Research Process

The five Ps of the research process

1. Clearly define the purpose of the research

2. Plan the research
3. Perform of the research
4. Process the research data
5. Prepare the research report

1. Purpose of the research

The first step in the research process is to explicitly state the goals of the research.

Managers and researchers need to develop a clear understanding of the problem to

be addressed.

Managers and researchers should agree on the specific question or questions the
research is designed to investigate.
 The research may be exploratoryWhat needs are currently not being
met?. Or the research my be confirmatory.Was the ad effective?...Is
the product priced fairly?.

2. Plan of Research
Determine issues such as the sample design (methodology), measures, and the
analysis techniques to be used.

Three critical issues that influence the research plan.

Primary Versus Secondary Data

Primary data is collected specifically for the research problem under
investigation. This includes the direct collection of data.

For example, if a company wanted to know why users of a

competitive brand didnt prefer its brand, it may have to collect
primary data to find out.

Secondary data has previously been collected for other purposes but
can be used for the problem at hand. This may include industry
reports, census data, etc.

For example, if a company wanted to know the population size of

key global markets that it might enter, it could find this information
from secondary sources.

Secondary information has the advantage of usually being cheaper

than primary data. However, it may offer limited value for strategy-
specific research questions.

Qualitative Versus Quantitative Research

Qualitative research typically involves face-to-face interviews.
Qualitative research is usually exploratory and is good at identifying
issues. Open-ended questions are the norm. The two most common
types of qualitative research are focus groups and long interviews.
Focus groups usually bring together 6-10 target consumers in a
meeting with a moderator. One-on-one interviews offer good depth
and useful insight.
 Quantitative research involves more systematic procedures designed to
obtain and analyze numerical data. This type of data is usually
confirmatory in nature. Four common types of quantitative research in
marketing are a) observations b) surveys c) experiments and d)
mathematical modeling

Observational research involves watching people and recording

relevant facts and behavior. Common for retail research.

Survey research involves the collection of data by means of a

questionnaire either by mail, phone, online, or in person.

Survey Considerations:
Who to survey (sample unit)
How many to survey (sample size)
How to choose respondents

The wording of questions is critical.

Common wording problems:

Leading questions
Ex., How much better is our product?
Ambiguous questions
Ex., What is your favorite beverage?
Two questions in one
Ex., Do you like coffee and tea?

Experimental research involves manipulating one variable and

examining its impact on the other variables. Experiments are useful to
determine if a cause-effect relationship exists. For example,
McDonalds may price a new menu item at different prices in two
markets and compare sales.

Mathematical modeling research often involves secondary data, such

as scanner data collected and stored in computer files from retail
check- out computers. It is useful because it provides an efficient way
to study problems with extremely large secondary data sets.
 Conducting the Research: Company Versus Contract Research
Most larger consumer goods companies have marketing departments
that can perform a variety of types of research. However, there are
many marketing research firms, advertising agencies, and consulting
companies that do marketing research on a contract. If using in-house
research beware of introducing bias into the process. What product
manager wouldnt like to see positive feedback!

3. Perform of the Research

Data collection should be well planned and must be efficient (only ask
relevant questions).

Attempt to obtain and record as much data as possible - subject to the

constraints of time, money, and respondent privacy.

4. Processing of Research Data

The appropriate analysis techniques for collected data depend on the
nature of the research questions and the design of the research.

Qualitative research data consist of interview records that are content

analyzed for ideas or themes.

Quantitative research data may be analyzed in a variety of ways

depending on the objectives of the research.

5. Prepare of Research Report

The research report should include a write up of details of the research plan,
results, and in some cases provide strategic recommendations.

Considerations in the Research Process

NO MARKET RESEARCH IS BETTER THAN BAD MARKET
RESEARCH!!

Market research is used for decision-making. If your research plan is flawed you
will be making decisions based on bad data. It is critical that research is not
biased, and asks the rights questions to the right people.
 The sample must be representatives of the market population

The sample size must be adequate

Questions must be meaningful, pre-tested, and properly presented.

Be cautious if the market research is being done in-house that there is no bias.

Please review the Data Collection Method Pros and Cons (Figure 2.3)

Please review The Criteria for Evaluating Marketing Research Reports (Figure 2.4)