The Nature of Marketing Research

• Marketing research is one of the principal tools for answering questions because it: – Links the consumer, customer, and public to the market

through information used to identify and define marketing

– Generates, refines, and evaluates marketing actions– Monitors marketing performance– Underlines the understanding of marketing as a process

Marketing Research Defined

The systematic and objective process of generating information for aid in making marketing decisions

The American Marketing AssociationRedefines Marketing Research

Marketing research is the function which links the consumer, customer, and public to the marketer through

used to identify and define market opportunities and problems

generate, refine, and evaluate marketing performance

monitor marketing performance

improve understanding of marketing as a process

The Marketing Research Process

• specifying what information is required; • designing the method for collecting

information;• managing and implementing the collection

of data;• analyzing the results; and • communicating the findings and their

implications.

I don’t knowif we should

enter the Australian Market?

InformationReducesUncertainty

Marketing Research Types

Basic research

Applied research

Basic Research

• Attempts to expand the limits of knowledge• Not directly involved in the solution to a

pragmatic problem

Basic Research Example

• Do consumers experience cognitive dissonance in low-involvement situations?

Applied Research

• Conducted when a decision must be made about a specific real-life problem

Applied Research Example

• Should McDonalds add Italian pasta dinners to its menu?

• Marketing research told McDonald’s it should not?

• Should Procter & Gamble add a high-priced home teeth bleaching kit to its product line?

• Research showed Crest Whitestrips would sell well at a retail price of $44

Scientific Method• The analysis and interpretation of empirical

evidence (facts from observation or experimentation) to confirm or disprove prior conceptions

Scientific Method is a formalized research procedures that can be characterized as logical, objective, systematic, reliable, valid, impersonal, and ongoing.

Marketing Concept

• Central idea in marketing• Evolved over time • Not production-oriented • Marketing-oriented

Marketing Concept

ConsumerOriented

Long RunProfitability

Cross-FunctionalEffort

No One Know Better than Mom !!!

Does she know :

How much underwear you own ?

Jockey International Does ?

No One Know Better than Mom !!!

Does she know :

The number of ice cube you put in a

glass?

Coca-Cola Does ?

No One Know Better than Mom !!!

Does she know :

Which pretzels you usually eat first the broken ones or the

whole ones?

Try asking Frito-Lay

Knows

• We put 3.2 ice cubes in a glass• See 69 of its commercial everyday• Prefer cans out of vending machines to be at a temperature of 2 C

Did you know that ? 38 % North Americans would rather had a tooth pulled than take their car to a dealership for repairs

For every 10,000 Canadians in 1992there were 8.13 automated teller machines whilethere were only 5.26 for Americans and 3.36 for Germans

Lever Brothers Co. uncovered the fact that 79% of women said they didn’t trust their husbands to do the laundry

NOTHING ABOUT OUR BEHAVIOR IS SACRED !!!

68% of consumers prefer their toilet paper to unwind over the spool rather than the under.

Campbell Soup gave up trying to learn our opinions about the ideal sized meatball after a series of tests showed that we prefer one so big it wouldn’t fit in the can

Our favorite toothbrush color

is BLUE

Only 37% of us are using one

that’s more than six months old

47 % put water on brush before apply the paste15 % put water on after the paste24 % do both14 % don’t wet the brush at all

Keeping Customers and Building Relationships

• RELATIONSHIP MARKETING - the idea that a major goal of marketing is to build long-term relationships with the parties who contribute to the company’s success.

• Marketers want customers for life. • Managing the relationships that will bring

about additional exchanges

Total Quality Management• Much in common with marketing concept• Focus on integrating customer-driven

quality throughout the organization.• Stresses continuous improvement

Stages in Developing and Implementing a Marketing Strategy

• Identifying and evaluating opportunities• Analyzing market segments and selecting

target markets• Planning and implementing a marketing

mix• Analyzing market performance

Identifying and Evaluating Opportunities

Examples• Mattel Toys investigates desires for play

experiences• Home cooking is on the decline. Purchase of

precooked home replacement meals is on the rise.• Number of investors trading stock on the Internet

is growing.

Analyze Market Segments and Select Target Markets

Examples• Cadillac investigates buyers’ demographic

characteristics• MTV, monitoring demographic trends, learns the

Hispanic audience is growing rapidly• Sears learns women, age 25-54 with average

household income of $38,000, are core customers. Targets this market with "The Good Life at a Great Price. Guaranteed. Sears."

• test concept

• determine optimal product design

• package tests

• product modification

• brand positioning and repositioning

• test marketing

• control score tests

• types of distribution• attitudes of Channel members• intensity of wholesale & resale coverage

• channel margins

• location of retail and wholesale

outlets

• importance of price in brand selection

• pricing policies

• product line pricing

• price elasticity of demand

• initiating and responding to price changes

• optimal promotional budget

• sales promotion relationship

• optimal promotional mix

• copy decisions

• media decisions

• creative advertising testing

• claim substantiation

• evaluation of advertising effectiveness

0.00% APR

Plan and Implement a Marketing Mix

• Price: Safeway does a competitive pricing analysis• Distribution: Caterpillar Tractor Co. investigates

dealer service program.• Product: Oreo conducts taste test, Oreo cookie vs.

Chips Ahoy• Promotion: How many consumers recall the “Life

Tastes Good. Coca Cola!” slogan?

Analyze Marketing Performance• This year’s market share is compared to last

year’s.• Did brand image change after new

advertising?

Performance-monitoring Research

• Research that regularly provides feedback For evaluation And control

• Indicates things are Or are not going as planned

• Research may be required To explain why something “went wrong”

Determining When to Conduct Marketing Research

• Time constraints• Availability of data• Nature of the decision• Benefits versus costs

Is sufficient time

available?

Information already on

handinadequate?

Is the decision of

strategicor tactical

importance?

Does theinformation

valueexceed the

research cost?

ConductMarketingResearch

Do Not Conduct Marketing Research

Time Constraints Availability of Data Nature of the Decision Benefits vs. Costs

Yes YesYesYes

No No No No

Determining When to Conduct Marketing Research

Value

•Decreased certainty•Increased likelihood of a correct decision•Improved marketing performance and resulting higher profits

Costs•Research expenditures•Delay of marketing decision and possible disclosure of information to rivals•Possible erroneous research results

Potential Value of a Marketing Research Effort Should Exceed Its Estimated Costs

Marketing Research in the 21st Century

• Increased globalization• Growth of the Internet and other

information technologies

Global Research

• Business Research is increasingly global• Market knowledge is essential• A.C. Nielsen - more that 67% international

business

Global Marketing Research• General information about country -

economic conditions and political climate• Cultural and consumer factors• Market and competitive conditions -

demand estimation

The Internet is Transforming Society

• Time is collapsing. • Distance is no longer an obstacle. • Crossing oceans is only a mouse click

away. • People are connected 24 hours a day, seven

days a week. • "Instantaneous" has a new meaning.

Internet Research

• Seeking facts and figures about an issue • Surveys on Web sites