Welcome to Powerpoint slides

for

Chapter 2
The Marketing
Research Process:
An Overview
Marketing Research
Text and Cases
by
Rajendra Nargundkar
1

A marketing research project starts with an

information need. It ends with an actionable
report or presentation or both. In between are
various steps to ensure that the marketing
research project achieves what it set out to
do.

A diagrammatic representation of the Marketing Research

Process is shown in the figure below

We will now consider each of these steps in detail

Information Need

Consider, for example, an expensive advertising

campaign which has been running on television for 3
weeks. It may not have produced the expected jump in
sales in some of the major sales territories. The client,
let us assume, is a shaving blades manufacturer.
The marketing manager has to decide whether to
discontinue the campaign, or change it, or reconfirm that
the ad campaign is good. If the ad campaign is good, it
may be some other marketing variables such as the price
or distribution, or strong competitive promotions that are
the reasons for sales not being upto expectations.
4

One way to find out is to do marketing research.

Therefore, the marketing manager has identified an
information need , and it could be fulfilled by a
marketing research study.
There could be a second marketing manager who is
considering the launch of a new brand of deodorant in
the market. He wants to know how to position the
brand in the market, and get a rough estimate of
what the market size would be in the chosen
segments. He has an information need, which could
be filled by doing a consumer survey.
5

The risk involved in taking a marketing decision

with inadequate information, should be weighed
against the cost of getting the information, and,
taking a better-informed decision. Success depends
on many factors, and information is only one of
them.
A third marketing manager heads a popular music
channel on T.V. He wants to know which of his
video disc jockeys is the most popular, and which
show is the most watched. He could commission a
study by an independent marketing research agency
to do just that.
6

Of course, any need for information must be

examined in terms of the cost of obtaining the
required information. Also, the cost of not having
this information should be estimated.
The risk involved in taking a marketing decision with
inadequate information, should be weighed against the
cost of getting the information, and, taking a betterinformed decision. Success depends on many factors,
and information is only one of them.
7

Defining The Research Objective

If we do have an information need that can be met by

doing marketing research, the next step would be to
define the Research Objective in terms of that
information need.
For example, a study could have as its objective, the
determination of customer satisfaction with a brand of
new frost-free refrigerator launched by our company.

A research objective can be specified broadly, or

narrowly. One common pitfall in the field of
marketing research is to specify too many objectives
for a single marketing research project. It produces
a mass of data that is not really needed at that point
of time.
In most cases, about four or five objectives are
adequate to do a useful marketing research study.

Every objective translates into a few questions

on a questionnaire, and there is a limit to how many
questions a respondent can honestly answer before
his interest level goes down.
Sometimes, we call the research objective by
another name the research problem. Broadly,
these two terms can be used interchangeably.
Whatever the terminology used, the research should
end up with useful information that enables a
marketing manager or entrepreneur to make a better
decision. If a report is meant to lie on a shelf, it is
not really marketing research, but a waste of
resources.
10

Research Designs: Exploratory, Descriptive and Causal

A research design provides the framework to be used as

a guide in collecting and analysing data. But it is not
necessary that a particular research design is always the
best. Experience with different research designs will
generally provide the researcher with the capability to
match a research problem with an appropriate design.
For example, in a study for a new English daily
newspaper launched in Bangalore in the eighties, it was
found that the sales were much below expectations. A
survey was proposed. But as a complement to the
survey, the author's team at a research agency proposed
a Content Analysis of all the major dailies in Bangalore.
11

This method analysed the coverage of various

categories of news such as politics, sports,
regional, national, city-based news etc. by the
client's newspaper and the competitors.
This gave vital insights to the publishers of the
paper, and over a period, it became successful.
This is just an example to show that sometimes
unusual research designs do pay off.
Broadly speaking, we can classify research
designs into the following three kinds .Exploratory Research
.Descriptive Research
.Causal Research
12

Exploratory Research
It is generally used to clarify thoughts and opinions about
the research problem or the respondent population, or to
provide insights on how to do more conclusive (causal)
research.
An example could be a chocolate manufacturer wanting to
identify the ten most important variables his consumers use
to decide on whether to buy a chocolate brand.
The results of this exploratory study could provide him
with inputs for a second study using Factor Analysis
techniques (discussed in Part 2 of this book) to reduce the
ten variables into a smaller set of FACTORS.
13

Another example of exploratory research is a focus

group discussion among housewives to debate the
future of convenience foods in India. It may be used to
throw up ideas about new products, or suggest
modifications to existing products through a freewheeling discussion.
One major application of exploratory research is to
generate hypotheses for further studies.
The methods used in exploratory studies can range from
the usual surveys, to focus groups, to consultations with
experts in the field, to analysis of selected cases. An
example of the last may be to study three of a
company's best salespeople, and three of the worst, to
try and figure out what drives the sales of the products,
and their motivations. This could help in designing a
study of customers to find out more from them.
14

Descriptive Research

Most marketing research is of this type. Typically,

descriptive studies are either (1) longitudinal or (2)
cross-sectional.
Longitudinal studies
These generally take the form of a sample which is
studied over a period of time - from a few months to
a few years. An example is a panel. A Panel is a
sample of respondents chosen from the defined target
population for the study. This sample could be of
consumers, retailers or of any other type.
15

A consumer panel could be used to study consumption of

products/brands over a period of time. It could also be
used to measure viewership of T.V. shows, or readership
of magazines. A retail store audit is a variation of the
panel, with data being collected from retail stores on the
products/brands being stocked, shelf space allotted, sales
and promotions etc.
Panel data has the advantage of enabling comparisons at
different points of time For example, the effect of a
change in price, pack design, or other elements of the
marketing mix can be easily measured by comparing the
sales or market share before and after the change.
This is not so easy to do in typical survey data, because
it is cross-sectional in nature, for only one point in time.16

One other advantage of panels is that if a quick

check on something is needed, sample selection
time can be saved by approaching panel members.
In these days of the internet it may be possible to
get a quick response to a short survey of panel
members in a matter of a couple of days.
There is of course a disadvantage to panel data.
Panels suffer from a selection bias. Some people are
more likely to agree to be on a panel than others,
because it needs a commitment in terms of time and
effort to regularly record and report data. This
selection bias may make panels non-representative
17
of the target population.

In some data mining applications, the

analysis may resemble longitudinal
studies, because data from the same
customers or retailers over a period of
time may be analysed for patterns of
behaviour etc.

18

Cross-sectional design
It is the most commonly used in marketing
research. This is a one-shot research study at a
given point of time, and consists of a sample
(cross-section) of the population of interest. The
typical market survey is of this type.
Its advantages are that it gives a good overall
picture of the position at a given time.

19

It can cover many variables of interest, and is not

affected by the movement of elements in the
sample, because other elements can be substituted
for them (at least in consumer research).
The disadvantages could be that a cross-sectional
study tends to rely too much on numbers, can be
affected by poor quality of interviewers or
supervisors, and tends to view the population in
terms of too many generalisations - the "average"
consumer's views about anything, which may cloud
the individuals or segments among the population.
20

To some extent, the last mentioned problem can

be overcome with certain techniques of analysis.
For example, we can analyse data by town or
region or by other segments to prevent
unnecessary aggregation which is misleading.
On the whole, though, cross-sectional research
appears to be most preferred by market
researchers and their clients on account of its
simplicity and understandability. It is also quite
flexible in nature, and can take care of simple
analysis as well as complex statistical methods.

21

Causal Research Designs

In research, we can never be completely sure that
a particular variable (say X) influences another
(say Y). But a causal design seeks to establish
causation as far as possible, by employing controls
and conditions under which we can state with
reasonable confidence whether or not Y is affected
by X.
In addition to X and Y, of course, there may be
other variables which could affect the relationship
between X and Y. How to treat the other variables
during the analysis of the effect of X on Y also
forms part of the causal designs.
22

Causal designs differ from descriptive designs

in their greater probability of establishing
causality. The reason for this is that causal
designs are similar to experiments done in a
lab, where we know what goes in, what
changes are made, and what results from the
changes. Causal designs are also known as
Experimental Designs, for this reason.

23

Designing The Research Methodology

Every research study starts with some information
need. Sometimes, the information required can
be collected entirely from published sources or
internal records.
This is called secondary
research.
It is more usual, however, that we will need to
collect data from primary sources customers,
buyers, users, dealers or some other respondents.
24

The major parts of the research methodology that

need designing are
.Research Method Secondary and Primary
.Sampling Plan
.Questionnaire Design (if applicable)
.Field Work Plan
.Analysis Plan
Usually, the first thing one has to decide is the
method to be used for data collection.

25

Data Collection Methods

It is possible to collect data from respondents by many
different methods. The major methods commonly used
are
.Survey
.Observation
.Experimentation
.Qualitative Techniques
.Other specialised techniques
Quantitative methods are generally more popular than
qualitative techniques in marketing research studies.
Also, the survey technique is more popular than other
26
techniques.

Survey
There are different ways a survey can be carried out.
It can be done by telephone, by mail, or in person. In
present times, it can even be done by email using the
internet. Each of these has its own merits and
demerits.
For example, personal interviews have the advantage
that questions can be explained to respondents, and
facial reactions or body language can be observed.
Telephonic surveys have the advantage of low cost.
But facial reactions cannot be observed.
27

Internet surveys are quite new, but may have

the same disadvantages that telephonic surveys
have. It is difficult to ensure that all target
respondents have an opportunity for selection in
the sample.
For example, every potential respondent for the
survey may not be using the e-mail, or even a
computer. Therefore, the e-mail survey does not
represent a true sample of the target population
for many products or services. To that extent,
the results may be wrong, compared to the errors
in a door-to-door personal interview done with
scientific probability sampling.

28

But if some amount of error is acceptable and

speed is of the essence, an e-mail survey or a
telephone survey would be excellent methods. A
traditional mail survey would be much slower,
by comparison.
At present, personal interviews are the
preferred method for doing surveys in India.
Telephone and mail surveys are used in a
minority of cases where they are justified by the
target population and the objective of the
research.
29

Observation
Sometimes, Observation, or Experimentation
could be the method of choice. Observation is
a technique where the consumers behaviour is
recorded, usually without his knowledge.
For example, a video camera in a retail store
can be used to record a customers behaviour
while she buys a garment.

30

If it is a full service store, like many Indian

stores, she could ask for a particular brand or
brands, look for specific colours, or fabric, or
prices etc. in a particular sequence. Her facial
reactions or eagerness or lack of interest when
a piece is displayed to her can be recorded
along with the garment.
Viewed later, this video tape can be interpreted
for the purchase factors, purchase behaviour,
brand preference, price and colour preference,
and matched with the ladys age and
complexion if she bought for herself.
31

The obvious advantage of this technique is that

it is actual consumer behaviour that gets
recorded, rather than their statements of
purchase intention. Therefore, we get more
accurate information.
If a video recording is too expensive, an audio
recording is possible, or even a data collector in
person can observe and record his findings on
paper.

32

Experimentation
This is the third major technique in quantitative
research. This involves more control over the cause
and effect, when compared to a survey.
In experiments, we try to measure the effect of one or
more variables by changing the level of some
variables, and measuring the effects. For example, if
an advertisement is released, and we measured the
Brand Awareness of the advertised brand among a
sample of target respondents, we would be doing an
experiment.
33

In the same way, a product test could be designed

as an experiment, with three different variants of
the product being tested on three randomly
chosen sets of respondents from a target
population. The modern method of Simulated
Test Marketing (STM) is usually a design which
can be termed an experiment.
A detailed discussion of experimental techniques
with numerical examples appears in the Chapter
titled ANOVA.
34

Qualitative Techniques
Sometimes, the research objective calls for more
indirect methods of questioning, either because
normal quantitative surveys are inadequate, or
inappropriate.
In such cases, qualitative methods, which probe the
minds of respondents may be used. Here, the
emphasis may be on free-wheeling interviews with
open-ended, unstructured questions such as What
do you expect from a refrigerator?, What needs
does it fulfill? or What do you feel when a friend
shoots an envious glance at your car?
35

Other methods of qualitative research include the

Word Associations where a respondent is asked to
think of a word which comes to mind when he
thinks of a brand.
Other variations include
associating each brand with a person or celebrity,
or an animal, etc.
The major requirement for using qualitative
techniques is that we require a behavioural
specialist such as a psychologist or sociologist to
analyse the findings.
The sample sizes in
qualitative studies are usually small, and analysis
and interpretation is not as easy as it is in
quantitative studies. If done by non-experts,
qualitative research can be completely misleading. 36

Qualitative techniques can also be used in

combination with quantitative techniques to
gain better insights into consumer mindsets.

37

An example of qualitative research is a study done

by TVS Suzuki, among scooter and moped users in
1989. (cited in The Catalyst, Business Line, July 10,
1989).
The research objective was to assess the impact of a
newly launched scooterette from Bajaj on the market
for TVS mopeds, and to try and find out what people
expected TVS to do in response.
The method used was focus groups, who discussed on
motivations behind purchase of mopeds and scooters.

38

Projective techniques were also used with

respondents being asked to put themselves
in place of existing moped brands and talk
about themselves as if they were the brands.
The concept of a low cost scooterette was
then exposed to the participants, and their
interest levels appeared high. This research
formed one of the bases for TVS to design
and launch the SCOOTY.
39

Specialised Techniques
There are three specialised techniques, used commonly by
marketing researchers
.A Consumer Panel is a sample of consumers chosen for
keeping a record of what they buy in a given period or what
T.V. shows they watch in a given period The special feature
of this is that the sample remains the same for a year or six
months
.Retail Audit : Many companies routinely do a retail audit
and publish the results (at least partially). Detailed reports
are available for anyone to buy and use. A retail audit
measures what brands are sold and their quantity sold in a
particular period. It could be done weekly. In India, ORG
is a company which routinely performs retail audits.
40

Both regional and national audits can be done.

Usually, such audits are best done by a third
party (independent agency), to reduce chances of
bias, rather than the marketing company.
Sometimes, similar studies are undertaken by the
company for its own brands at either consumer
level or retail level.
T.V. Audience Measurements : These days,
millions of rupees are spent in ads on T.V. It is
important for the marketer to know who is
watching the T.V. shows on which he has
advertised. Or, to plan for a particular audience
profile.
41

There are now commonly used technologies

which record who is watching a given channel
and show at any given time, for upto a week.
These are called Peoplemeters, and are available
in India for about Rs. 40,000/- a piece. Indian
Market Research companies such as IMRB and
ORG-MARG/A.C. Nielsen have already started
using them, and their use is likely to grow. The
branded names for the peoplemeters in India are
TAM and INTAM.
The new meters have changed the advertising
patterns of many T.V. channels and individual
42
shows after they were introduced in India.

The next stage in a marketing research study, after the

primary research method has been decided upon, is the
plan for
.Sampling
.Field Work
.Analysis
These are probably the most important in a study
involving primary research, as the credibility and the
accuracy of a study is dependent on these stages.
43

Sampling Plan
This is the statement of what will be the sample
composition and size. This is the most critical of all
decisions in the marketing research process, because
we are usually trying to make a statement about the
target population based on our study of the sample.
For instance, if we find that 50% of our sample is
favourably disposed towards Brand A, we are likely
to use it as a benchmark for the entire target market,
give or take a few percentage points (due to errors).
But in order to make the sample representative of the
population, a lot of care has to be taken by the
researcher.
44

In general, two precautions should be taken to ensure a

good sample (good means representative).
.Use a probabilistic sampling technique which is not
biased.
.Try and divide the population to be sampled into
segments or strata based on relevant parameters such
as users/non-users, or classes based on age, income,
etc. Then, ensure that each segment gets represented
adequately in the final sample. This also applies to
studies that are done in multiple cities. If a study is
done in twenty cities, and if analysis is required by
city (i.e. for each city separately), then the sample size
for each city must be adequate for such analysis.
45

Generally, formulas can be used to determine

sample sizes, but they suffer from some
limitations. For a more detailed discussion,
please refer to the chapter titled Sampling
Methods Theory and Practice.
It is usually a blend of theory, practical
limitations and experience which generates
the best sampling plan in any given research
situation.
46

Field Work Plan

This is clearly linked to the sampling plan. Once the
sampling centres (cities, towns, etc.) are decided on,
and the sample sizes are determined for each, the next
step is to plan on the following
.Who
.When
The first question is who will do the field work for
collecting data. Field work assumes that we are
collecting data from respondents by going to the
field that is, homes, offices, shops, dealerships,
etc.
47

Before doing field work, whoever is going out in the

field needs to have an idea of what is to be collected
and its format of recording. In the traditional
format of personal interviews (which is still the most
popular format in India), a questionnaire is used by
the field workers in most cases.
Sometimes, a checklist is used instead, if the
situation demands it. We will assume here that the
questionnaire has been developed. A detailed
discussion of how to develop a good questionnaire
appears in the chapter titled Questionnaire Design
a Customer-centric Approach.
48

The second question is when. In many

studies carried out nationally, it is not possible
always to simultaneously cover all centres, on
the same days. There could be logistical
problems for supervisors, or there may be
difficulties in recruiting adequate field
workers etc. But it is desirable to have a wellplanned schedule so that all field work is
completed in an orderly fashion, and crosschecks can be established.

49

Briefing
For all important studies, the research executive in
charge should personally brief the field supervisor (the
person who will actually supervise the team of field
workers during the data collection).
This briefing session is conducted after recruiting field
workers, and ends with a practice round of mock
interviews and questions from field workers on any
special difficulties they may encounter in locating
respondents, asking certain questions, etc.
50

The mock interviews and the briefing session is

designed to explain and clarify to the field workers
how to go about their data collection task. In most
studies, temporary field workers are recruited on a daily
wage basis and paid on the basis of a minimum number
of complete, usable questionnaires filled up.
The number of field workers required in each centre is
usually estimated based on the sample size required, the
locations where the sample can be found, the number of
supervisors available, and the time limit for completion
of field work. These are communicated by the research
executive in charge to the field supervisors in his
branch offices, who generally recruit the field workers.51

Debriefing
It is important that any problems on the field get
reported to the field supervisor or the research
executive, and solutions found quickly. These problems
may include difficulty in locating target sample units, or
non-cooperation in answering some questions, or
difficulties in comprehension.
To minimise any problems the field staff may encounter,
a debriefing session is usually held at the end of the first
days field work in each new centre (location). The
field staff reports on the work progress, and problems
faced in the field, if any. Solutions are thought of by the
research executive or field supervisor, and implemented
52
for the remaining part of the study.

Some of these problems are recognised even earlier

if a pilot study of a small sample is performed,
before starting regular field work. Alternatively, the
first days or half days field work could be
considered as a pilot study, and not included in the
survey results.

53

Analysis Plan and Expected Outcome

Analysis is based on the answers given to questions.
It is important to have an analysis plan in mind even
before going to the field with a questionnaire.
Regrettably, this is not always given the attention it
deserves by the researcher. It is sometimes assumed
that it can be done later, or that all possible analyses
can be done anyway, so why bother to plan the
analysis in advance. But for many reasons, it is vital
to do so.
54

A very powerful reason is that the sample size

gets reduced, if the analysis is done on parts of
the sample. For instance, in a sample of 200
respondents, there could be 16 combinations of
income (4 groups) and age (4 age groups). If
analysis is performed for a combination of age
and income, we get a 16- celled output matrix.
Even assuming a uniform distribution of the
sample into these 16 cells, each cell only gets a
sample size of 100 / 16 or 12.5 persons. This
may not be good enough to draw conclusions
about the given Age-Income combination.
55

But if it is known in advance that we will analyse the

data by this combination, we can increase the sample
sizes in each cell to say, 20 or 30 by incurring marginal
additional cost. This cannot be done easily at the analysis
stage, after all data has been collected and tabulated.
In certain cases, special statistical procedures or tests have
to be performed. For example, in a procedure called
multidimensional scaling (covered in a later chapter), the
questionnaire has to be constructed in a particular way.
Otherwise, it is not possible to do the required analysis.
For these reasons, we must know in advance, at least the
56
types of analyses we want to perform.

There are normally two very basic kinds of analyses in a

marketing research study. These are
.Simple Tabulation
.Cross Tabulation
Simple Tabulation involves counting the number of
responses in each category for a question, and putting it in a
frequency table form. This can be used to compute
percentages, by dividing the number of responses by the
sample size. This is done for each question in the
questionnaire.
57

Cross Tabulation: This is the result of counting

simultaneously, answers to two or more different
questions on a questionnaire. For example, one
question may ask how frequently respondents buy
a soap brand. Answers may vary from Once a
Month to Thrice a Month.
Another question on the same questionnaire may
ask for their reaction to the fragrance of the soap.
We may want to cross tabulate the responses to
these two questions. How many of the people
who liked the fragrance bought once a month, and
how many of them bought twice or thrice a
month? Similarly, how many who did not like the
fragrance bought it once, twice or thrice a month?
58

While doing cross-tabulation, it is also necessary

that the two questions (variables) that we are crosstabulating must be related to each other. For
example, in the above example, it is possible that the
frequency of soap purchase is a function of family
size, rather than the liking for its fragrance.
It is possible to compute cross tabulation data for
any two questions on a questionnaire but all of
these may not be meaningful.

59

Expected Outcome
One good way to think about expected outcome
is to prepare a blank table of output, particularly
for any cross tabulations we may be interested in.
This can be done after the questionnaire is
designed, but before the field work is done. This
helps to anticipate some of the problems in
sampling and corrective action can be taken
easily to adjust sample sizes on the field.
60

Budget and Cost Estimation

There are two or three basic parameters which
provide an estimate of how much a study is going to
cost.
.Sample size
.How difficult to find the sampling units
(respondents) are, and their geographical dispersion.
.Who will do the field work

61

For example, if hired field workers are doing the

field work, a study costs much less per respondent,
than if a research executive conducts the interviews.
In some industrial marketing research, a qualified
research executive may in fact do the field work
himself. But in most consumer product or service
studies, it is hired temporary field workers who do
it. In such cases, sample size is multiplied by the
estimated cost per respondent to arrive at a total
cost estimate.

62

This estimate is modified by the number of

centres (geographical dispersion) for the study,
and the difficulty in locating required
respondents.
For example, locating a 2-wheeler owner for a
given brand of 2-wheeler (say, a Suzuki or
Honda), is much easier than locating an owner of
a luxury car say, a Mercedes. Additional cities
for the survey may entail travel and
communication cost for the research executive
and supervisory staff in addition to normal cost
of field work.
63

Presentation, Report and Marketing Action

After the tabulation and analysis is completed, the
next step is usually a presentation to the sponsor of
the study. This includes frequency tables and cross
tabulations in percentage terms, and special analyses
if any. It also includes a summary of major findings,
and some recommendations. If any additional cross
tabulations are required, the client or sponsor usually
requests them at this stage.

64

A formal report usually follows the presentation.

This should normally contain the following :
.Executive Summary
.Table of Contents
.Introduction
.Research Objectives
.Research Methodology
-Sample Design
Field Work Plan and Dates
-Analysis / Expected Outcome Plan
-Questionnaire Copy (as Annexure)
65

.Analysis
-Simple Tabulation
-Cross Tabulation
-Any Special Analysis
.Findings
.Limitations
.Recommendations for Action
.Bibliography / List of References
Based on the report, the client normally will take
some marketing actions. This is the expected
outcome of any marketing research study.
66