Marketing Research Notes - Introduction I

MEANING OF MARKETING RESEARCH

The term Marketing Research is composed of two words -Marketing and Research

MarketingMarketing basically consists of spotting the needs of customers and meeting them in the best possible manner through appropriate production and distribution activities

The term marketing refers to buying and selling activities Exchangetransfer of ownership is the essence of marketing

ResearchResearch means detailedsystematiccomprehensive study of a problem

Research is a process involving a series of steps to collect and analyze the information needed for decision-making in the desired specific field of inquiry The term research can be applied to any field of human activity

Research means ldquostudious enquiry or thorough honest and impartial study conducted by trained men using scientific methods It means detailed study relating to a particular subject

The term MR is used extensively in modern marketing management It acts as a tool for accurate decision making in marketing of goods and services It is also useful for studying and solving different marketing problems faced by business units Here the details (information and data) of the marketing problem are collected and studied conclusions are drawn and suggestionsrecommendations are made to solve the problem quickly correctly and systematically In MR marketing problem is studied in depth by collecting and analyzing all relevant information and solutions are suggested to solve the problem relating to consumers product market competition sales promotion and so on

MR is a special branch of marketing management It is comparatively of recent in origin MR acts as an investigative arm of a marketing manager It suggests possible solutions on marketing problems for the consideration and selection by a marketing manager It also acts as an important tool to study buyer behavior changes in consumer life-styles and consumption patterns brand loyalty and forecast market changes

MR techniques are used by manufacturersexportersdistributors and service organizations to collect information on various aspects of marketing The information collected is analyzed and used for decision-making in the marketing management MR facilitates accurate marketing decisions for consumer satisfaction on the one hand and sales promotion on the other hand It is rightly treated as the SOUL of modern marketing management MR suggests possible solutions on marketing problems

to marketing manager for his consideration and final selectiondecision It is rightly said that the beginning and end of marketing management is marketing research Decisions on each element of the marketing mix-product price distribution and promotion-need marketing research support Marketing research is primarily used to provide information needed to guide marketing decision viz market mix It acts as a support system to marketing management

DEFINITIONS OF MARKETING RESEARCH

Let us now consider some definitions of MR(1) The most widely accepted definition of marketing research is given by American Marketing Association (AMA) The AMA has defined marketing research as the systematic gathering recording and analyzing of data about problems relating to the marketing of goods and servicesrdquo(2) According to Richard D Crisp Marketing research is the systematic objective and exhaustive search for and study of the facts relevant to any problem in the field of marketing(3) According to Philip Kotler Marketing research is systematic problem analysis model building and fact-finding for the purpose of improved decision-making and control in the marketing of goods and services(4) Luck Wales and Taylor have defined marketing research as the application of scientific method to the solution of marketing problems(5) Green and Tull have defined marketing research as the systematic and objective search for and analysis of information relevant to the identification and solution of any problem in the field of marketing(6) British Institute of Management In 1962 the British Institute of Management defined marketing research as The objective gathering recording and analyzing of all facts about problems relating to the transfer and sales of goods and services from producer to consumer

FEATURES OF MARKETING RESEARCH

(a) Marketing research is concerned with systematic gathering recording and analyzing of information In MR information that is relevant to the marketing problem is collected in a systematic manner from all available sources Thereafter the same is tabulated and recorded for systematic scrutiny Such scrutiny will offer certain specific conclusions useful for solving the marketing problem

(b) In MR information is to be collected objectively and accurately This feature of MR suggests that the required information needs to be collected objectively In brief the information collected should be accurate precise relevant and properly verified The conclusions drawn and the remedial measures introduced will be ineffective if the information collected is not reliable

(c) Marketing research is a tool for solving marketing problems MR is a means and not the end in itself It is a tool in the hands of management for identifying and analyzing marketing problems The purpose is to solve them correctly

CHARACTERISTICS OF MARKETING RESEARCH(1) Systematic and continuous process MR is a continuous process This is natural as new marketing problems are bound to come from time to time in the course of marketing of goods and services One type of research is not adequate to resolve all marketing problems Similarly new research projects will have to be undertaken to solve new marketing problems and challenges A marketing company faces new marketing problems from time to time For facing these problems marketing research activities need to be conducted on a regular basis A marketing company has to conduct MR regularly for its survival amp growth in the present dynamic marketing environment(2) Widecomprehensive in scope and application MR is wide in scope as it deals with all aspects of marketing of goods and services It is more than just collecting data on marketing Introduction of new products identification of potential markets selection of appropriate selling techniques study of market competition and consumer preferences introduction of suitable advertising strategy and sales promotion measures are some areas covered by MR It plays a role in all the three phases of the management process in marketing planning implementation and evaluation(3) Emphasizes on accurate data collection and critical analysis In MR required data should be collected objectively and accurately The data collected must be reliable It should be analyzed in a systematic manner This will provide comprehensive picture of the situation and possible solutions(4) Offers benefits to sponsoring company and consumers MR is useful to the sponsoring company It raises the turnover and profit of the company It also raises the competitive capacity and creates goodwill in the market It enables a company to introduce consumer-oriented marketing policies Consumers also get agreeable goods and more satisfaction due to MR activities(5) Commercial equivalent of military intelligence MR is the commercial intelligence activity It is similar to military intelligence where systematic study is made before taking any military action MR acts as the intelligence tool of marketing management(6) Tool for managerial decisions MR acts as a tool in the hands of management for identifying and analyzing marketing problems and finding out solutions to them It is an aid to decision-making It suggests possible solutions for the consideration and selection by managers MR is an aid to judgment and never a substitute for it(7) Applied type of research MR is applied knowledge It is also called decisional research as it provides specific alternative solutions to deal with a specific marketing problem It studies specific marketing problem and suggests alternative solutions and possible outcome of each alternative In addition it is both science and an art MR is also becoming highly professional activity(8) Reduces the gap between the producers and consumers MR is an essential supplement of modern competitive marketing It is useful for understanding the needs and expectations of consumers It reduces the gap between producers and consumers and adjusts the marketing activities to suit the needs of consumers(9) Not an exact science MR is both science and an art It collects information and studies marketing problem in a scientific manner The information collected is also applied to real lire problem However MR is not an exact science It only suggests possible solutions and not the exact solution to marketing manager for consideration and selection At present MR is treated as a professional activity We have professional agencies (MR agencies or advertising agencies) dealing with the marketing problems of their clients on commission basis(10) Use of different methods MR can be conducted by using different methods Data can be collected through survey or by other methods like observation method or experimentation method Even computers and internet are used for data collection The researcher has to decide the method

that is suitable for the conduct of research project This selection is important as the use of unsuitable methods affect the quality of research work(11) Dynamic character MR is dynamic in nature Its scope is fast expanding along with the new developments in the field of marketing This is natural as MR is essentially for dealing with new problems and challenges in the field of marketing In addition developments in other subjects such as economics statistics computer science sociology psychology cultural anthropology and behavioral sciences also bring corresponding changes in the field of MR New methods new techniques etc are used while conducting the research activities This suggests that MR is a dynamic and progressive subject with new developments taking place regularly(12) Closely connected with marketing information system Both the concepts are interrelated In fact MR is one component of MIS Both are useful for solving marketing problems and for accurate and quick decision-making in the field of marketing(13) Phenomenal growth MR has made a phenomenal growth since its inception It has become an important tool in the hands of management (to solve marketing problems) along with the advent of consumer-oriented philosophy in modern business The increasing research budgets of companies are the indicators of its tremendous growth in recent years

AIMS AND OBJECTIVES OF MARKETING RESEARCHThe aims of the marketing research and analysis may be stated as follows(1) To study the needs wants and expectations of consumers(2) To find out reactions of consumers to the products of the company(3) To evaluate companys sales promotion measures for suitable adjustment and improvement(4) To study current marketing problems and opportunities for suitable follow-up actions(5) To suggest the introduction of new products modifications of existing products and to discover new uses of existing products(6) To design and test appropriate packages of companys products and make packaging as attractive as possible(7) To study existing pricing channels of distribution and market competition for suitable changes if necessary(8) To find out methods for making the products of the company popular and raising its goodwill and market reputation(9) To assess competitive strength and policies(10) To estimate potential buying-power in various areas(11) To know the companys expected share of the market(12) To determine the dimensions of the marketing problems facilitate evaluation of the alternative solutions of different problems and help in the selection of a right course of action(13) To define the probable market for a specialized product and to report on general market conditions and tendencies buying habits etc

MARKET RESEARCH VS MARKETING RESEARCHThe two terms ldquomarket research and marketing research are used interchangeably though there is difference in the meaning and scope of the two terms Market research is used as a popular synonym for marketing research Market is a part of marketing and market research is only a part of marketing research It covers only a few aspects of marketing According to Philip Kotler the term market research is accurate for describing research into the market its size geographical

distribution income and so on However it fails to cover the idea of research into the effects of marketing efforts on the market for which the term marketing research is more accurate MR is increasingly coming into favor as the term that describes both ideas Marketing research need not be treated as pure academic research It is a type of applied research with scientific orientation

Distinction between market research and marketing research

DimensionMarket ResearchMarketing ResearchMeaningMarket research directly relates to market situation ie size location market competition and features of customers It provides details about the market for decision-making and policy framingMarketing research is a systematic and comprehensive searchstudy of different aspects of marketing - including the current marketing problems and challenges for decision-making amp policy framingNatureMarket research is a branch of marketing research

Marketing research is one branch of Marketing Information SystemScopeThe scope of market research is limitedrestricted to the study of market or market situation

The scope of marketing research is comprehensive amp wide as it covers all aspects of marketingType of termMarket research is a narrow term as it relates to one aspect of marketing

Marketing research is a widebroad term as it covers all aspects of marketingObjectiveMarket research is undertaken in order to deal with the problems and challenges relating to different aspects of market such as competition market demand and consumer needs

Marketing research is undertaken in order to study varied types of marketing problems such as product line marketing mix advertising packaging branding and so on

GROWING IMPORTANCE OF MARKETING RESEARCH

Marketing research has received attention and importance along with the growth of highly competitive consumer-oriented marketing philosophy Research activities in different aspects of marketing are necessary and useful in such competitive and flexible marketing environment Large companies marketing consumer items noted the growing need of MR activities in the marketing decision-making process They naturally took initiative in conducting research activities within the organization itself This was followed by the formation of specialized marketing research agencies and advertising agencies for this purpose This is how professional orientation was given to MR

Many marketing research departments and agencies were established after World War II

MR activity (as we understand today) is comparatively new in the field of marketing This activity probably began around 1950s (Modern era of marketing research) and attracted the attention of companies interested in marketing their products in the national and global markets However the concept of MR got firm roots in the marketing activity after 1910 First time the marketing research techniques were used by newspapers to predict the election results However during the second decade of 20th century marketing research emerged as a valuable management tool to solve marketing problems In the developed countries marketing research activity is conducted on scientific lines Even in India large manufacturing companies treat marketing research as an essential supplement of planning and decision-making in the marketing field It is treated as an indispensable tool for profitable and consumer-oriented marketing The popularity of MR increased after 1960 due to the introduction of computers in data collection and analysis In the early period marketing research activities were confined to market studies only but in 1950s research relating to marketing activities was broadened to include all managerial aspects-price produce place and promotion In late 1950s motivational and psychological techniques were introduced to generate more information on consumers

Several factors have contributed to the growing importance of marketing research For example due to large-scale production producers could not have direct contact with the consumers This created many problems before producers For solving all such problems developed due to the gap between producers and consumer and marketing research activities prove to be useful

Secondly the shifting from sellersrsquo market to buyers market made it necessary to have better understanding about consumer net-expectations For this marketing research proved to be useful

Thirdly the introduction of computers has contributed to the growth of marketing research activity

Fourthly rapid changes in the business environment shift to consumer-oriented philosophy in business are also responsible for growing importance of marketing research

Finally the scope of marketing has widened due to population growth and development of rural markets MR proved to be useful for dealing with the problems created by national and global markets In brief growing importance of marketing research in the present marketing system is the net result of various factors and forces available in the present marketing system At present MR activities are undertaken by marketing companies on their own In addition marketing research consultants and agencies provide expert advice to companies on general and specific marketing problems of their clients

Relevance of MR under GlobalizationThe business world is fast moving towards globalization in which all countries participate Every country has to face competition in the domestic as well as in export marketing Survival in the global business is possible through quality improvement cost reduction and by attracting consumers through various sales promotion techniques Here MR offers helping hand to companies It offers

suggestions for survival under global competitive environment In brief the importancerelevance of MR is fast growing along with the globalization of business It is a must for survival and growth under globalization Current marketing scenario is different as compared to traditional one There is a new trend towards liberalization and globalization Markets (domestic as well as foreign) are becoming highly competition New companies and new products re entering in the markets Survival is difficult under the present marketing environment Here MR offers various services It is now a professional activity with new developments in regard to scopecoverage and techniques In brief MR has great relevance in the current marketing scenario in India as well as in all countries- developed and developing of the world MR has enormous capacity to help and guide marketing companies in regard to their marketing problems and challenges

FUNCTIONS OF MARKETING RESEARCHMR performs five basic functions These are Description evaluation explanation prediction and finally aid in decision-making These functions are related to the research project undertaken Usually every research study performs all the five functions explained below(1) Description MR provides data and gives informationdescription of customers who buy the product This includes information about their agesex education income and the amount of money that they are willing to spend on the product Description of the customers is useful in order to draw certain conclusions about the customers and their buying behavior Even marketing strategies can be decided as per the information available(2) Evaluation MR is useful for understanding the viewsreactions of the buyers This includes views of consumers on packaging advertisingsales promotion measures used A manufacturer gets these details as well as the information about his product in comparison with the products of his competitors This facilitates evaluation of the marketing policies For example how far the packaging of the product is attractive to consumers or superior as compared to packaging by competitors and so on(3) Explanation MR gives explanation to certain questions of a manufacturer It may be related to decline in sales retailers negative reaction or resistance of consumers in a particular marketing area MR enables a manufacturer to understand why sales are reducing (causes) or why the response of the retailers is negative or why consumers in a particular region are not willing to purchase a specific product Such explanation is important as it enables a manufacturer to adjust his marketing policies in order to rectify the prevailing unfavorable situation(4) Prediction MR conducts prediction function Such predictions may be related to consumers market environmentmarket competition possible socio-economic changes and so on This prediction function enables a manufacturer to understand how much people will spend on the specific product in the next year or the fashions that consumers may prefer in the next year In addition prediction about the possible turnover in the years to come is also possible through suitable marketing research studies In brief marketing research is useful for understanding the marketing environment likely to develop in future This facilitates proper adjustment in the marketing policies for the future period In this sense the prediction function is important even when all predictions made through research studies may not prove to be fully correct However the trend indicated can be used for appropriate policy decisions(5) Aid in Decision-making One more function of MR is to facilitate the process of decision-making in the marketing field MR guides the manufacturer as regards the manner in which he can make

effective advertising appeal or create incentive among his salesmendistributors It also gives him guidance as regards price fixation and sales promotion techniques that will be useful for the future period This function of marketing research is closely related to other functions that it performs These functions facilitate reasonably correct decision-making by marketing managers

They also suggest the practical utility of MR activities

MR functions provide feedback (information and guidance) to marketing managers and improve the quality of their decision-making This practice is certainly safer as compared to decision-making on the basis of past experience or intuition When reality is complex and many facts are not detectable intuition is not adequate for decision-making Similarly experience is useful but decisions on experience alone may not be accurate

Large companies and professional executives prefer to resort to marketing research than depending on experience This is because information available is based on real data and is more reliable dependable This facilitates correct decision-making Thus marketing executives should prefer decisions on the basis of information supplied through marketing research Such decisions are likely to be more accurate as they are based on actual market situation

In brief the basic function of MR is to support marketing decision-making process Marketing research does not provide ready-made decisions or exact solutions on all marketing problems It only provides the clues or possible solutions that should be taken into consideration in the decision-making process It provides support to skills and abilities of marketing managers

The different functions of marketing research are supplementary in character These functions enable a manufacturer to keep close touch with the marketing situation and enable him to make suitable changes in his marketing policies and programmers They also suggest the role marketing research activity in modern competitive and consumer oriented marketing Marketing research functions certainly improve the quality of decision-making by marketing managers

ADVANTAGESIMPORTANCE OF MARKETING RESEARCH1 Indicates current market trends Marketing research keeps business unit in touch with the current market trends and offers guidance for facing market situation with confidence2 Pinpoints deficiencies in marketing policies MR pinpoints the deficiencies as regards products pricing promotion etc It gives guidance regarding different aspects of marketing They include product development branding packaging and advertising3 Explains customer resistance MR is useful for finding out customer resistance to companys products The researcher also suggests remedial measures to deal with the situation This makes the products and marketing policies agreeable to consumers4 Suggests sales promotion techniques MR enables a manufacturer to introduce appropriate sales promotion techniques select most convenient channel of distribution suitable pricing policy for the products and provision of discounts and concessions to dealers Marketing research facilitates sales promotion5 Offers guidance to marketing executives MR offers information and guidance to marketing

executives while framing marketing policies Continuous research enables a company to face adverse marketing situation boldly It acts as an insurance against possible changes in market environment6 Facilitates selection and training of sales force Marketing research is useful for the selection and training of staff in the sales organization It also suggests the incentives that should be offered for motivation of employees concerned with marketing7 Promotes business activities Marketing research enables a business unit to growexpand its activities It creates goodwill in the market and also enables a business unit to earn high profits through consumer-oriented marketing policies and programmers8 Facilitates appraisal of marketing policies Research activities enable business executives to have an appraisal of the present marketing policies in the light of findings of research work Suitable adjustments in the policies are also possible as per the suggestions made by the researchers9 Suggests new marketing opportunities MR suggests new marketing opportunities and the manner in which they can be exploited fully It identifies emerging market opportunities10 Facilitates inventory study Marketing research is useful for the evaluation of companyrsquos inventory policies and also for the introduction of more efficient ways of managing inventories including finished goods and raw materials11 Provides marketing information MR provides information on various aspects of marketing It suggests relative strengths and weaknesses of the company On the basis of such information marketing executives find it easy to frame policies for the future period MR provides information guidance and alternative solutions to current marketing problems12 Suggests appropriate distribution channels MR can be used to study the effectiveness of existing channels of distribution and the need of making suitable changes in the distribution system13 Provides information on product acceptance Marketing research helps in knowing the probability of acceptance of the product in its present form It is also useful for the introduction of modifications in the existing product line of a firm14 Creates progressive outlook MR generates a progressive and dynamic outlook throughout the business organization It promotes systematic thinking and a sense of professionalization within the company It also creates enthusiasm among marketing executives This brings success and stability to the whole business unit15 Has wider social significance MR is of paramount importance from the social angle It is the means by which the ultimate consumer literally becomes king of the market place with his desires prejudices and every whim transmitted to the producer and distributor In brief MR has wider social significance It is useful to all parties involved in the process of marketing

A marketing information system (MIS) is intended to bring together disparate items of data into a coherent body of information An MIS is as will shortly be seen more than raw data or information suitable for the purposes of decision making An MIS also provides methods for interpreting the information the MIS provides Moreover as Kotlers1 definition says an MIS is more than a system of data collection or a set of information technologies

A marketing information system is a continuing and interacting structure of people equipment and procedures to gather sort analyse evaluate and distribute pertinent timely and accurate information for use by marketing decision makers to improve their marketing planning implementation and control

Figure 91 illustrates the major components of an MIS the environmental factors monitored by the system and the types of marketing decision which the MIS seeks to underpin

Figure 91 The marketing information systems and its subsystems

The explanation of this model of an MIS begins with a description of each of its four main constituent parts the internal reporting systems marketing research system marketing intelligence system and marketing models It is suggested that whilst the MIS varies in its degree of sophistication - with many in the industrialised countries being computerised and few in the developing countries being so - a fully fledged MIS should have these components the methods (and technologies) of collection storing retrieving and processing data notwithstanding

Internal reporting systems All enterprises which have been in operation for any period of time nave a wealth of information However this information often remains under-utilised because it is compartmentalised either in the form of an individual entrepreneur or in the functional departments of larger businesses That is information is usually categorised according to its nature so that there are for example financial production manpower marketing stockholding and logistical data Often the entrepreneur or various personnel working in the functional departments holding these pieces of data do not see how it could help decision makers in other functional areas Similarly decision makers can fail to appreciate how information from other functional areas might help them and therefore do not request it

The internal records that are of immediate value to marketing decisions are orders received stockholdings and sales invoices These are but a few of the internal records that can be used by marketing managers but even this small set of records is capable of generating a great deal of information Below is a list of some of the information that can be derived from sales invoices

middot Product type size and pack type by territorymiddot Product type size and pack type by type of accountmiddot Product type size and pack type by industrymiddot Product type size and pack type by customermiddot Average value andor volume of sale by territorymiddot Average value andor volume of sale by type of accountmiddot Average value andor volume of sale by industrymiddot Average value andor volume of sale by sales person

By comparing orders received with invoices an enterprise can establish the extent to which it is providing an acceptable level of customer service In the same way comparing stockholding records with orders received helps an enterprise ascertain whether its stocks are in line with current demand patterns

Marketing research systems The general topic of marketing research has been the prime subject of the textbook and only a little more needs to be added here Marketing research is a proactive search for information That is the enterprise which commissions these studies does so to solve a perceived marketing problem In many cases data is collected in a purposeful way to address a well-defined problem (or a problem which can be defined and solved within the course of the study) The other form of marketing research centres not around a specific marketing problem but is an attempt to continuously monitor the marketing environment These monitoring or tracking exercises are continuous marketing research studies often involving panels of farmers consumers or distributors from which the same data is collected at regular intervals Whilst the ad hoc study and continuous marketing research differs in the orientation yet they are both proactive

Marketing intelligence systems Whereas marketing research is focused market intelligence is not A marketing intelligence system is a set of procedures and data sources used by marketing managers to sift information from the environment that they can use in their decision making This scanning of the economic and business environment can be undertaken in a variety of ways including2

Unfocused scanning

The manager by virtue of what heshe reads hears and watches exposes himherself to information that may prove useful Whilst the behaviour is unfocused and the manager has no specific purpose in mind it is not unintentional

Semi-focused scanning

Again the manager is not in search of particular pieces of information that heshe is actively searching but does narrow the range of media that is scanned For instance the manager may focus more on economic and business publications broadcasts etc and pay less attention to political scientific or technological media

Informal search

This describes the situation where a fairly limited and unstructured attempt is made to obtain information for a specific purpose For example the marketing manager of a firm considering entering the business of importing frozen fish from a neighbouring country may make informal inquiries as to prices and demand levels of frozen and fresh fish There would be little structure to this search with the manager making inquiries with traders heshe happens to encounter as well as with other ad hoc contacts in ministries international aid agencies with trade associations importersexporters etc

Formal search

This is a purposeful search after information in some systematic way The information will be required to address a specific issue Whilst this sort of activity may seem to share the characteristics of marketing research it is carried out by the manager himherself rather than a professional researcher Moreover the scope of the search is likely to be narrow in scope and far less intensive than marketing research

Marketing intelligence is the province of entrepreneurs and senior managers within an agribusiness It involves them in scanning newspaper trade magazines business journals and reports economic forecasts and other media In addition it involves management in talking to producers suppliers and customers as well as to competitors Nonetheless it is a largely informal process of observing and conversing

Some enterprises will approach marketing intelligence gathering in a more deliberate fashion and will train its sales force after-sales personnel and districtarea managers to take cognisance of competitors actions customer complaints and requests and distributor problems Enterprises with vision will also encourage intermediaries such as collectors retailers traders and other middlemen to be proactive in conveying market intelligence back to them

Marketing models Within the MIS there has to be the means of interpreting information in order to give direction to decision These models may be computerised or may not Typical tools are

middot Time series sales modesmiddot Brand switching modelsmiddot Linear programmingmiddot Elasticity models (price incomes demand supply etc)middot Regression and correlation modelsmiddot Analysis of Variance (ANOVA) modelsmiddot Sensitivity analysismiddot Discounted cash flowmiddot Spreadsheet what if models

These and similar mathematical statistical econometric and financial models are the analytical subsystem of the MIS A relatively modest investment in a desktop computer is enough to allow an enterprise to automate the analysis of its data Some of the models used are stochastic ie those containing a probabilistic element whereas others are deterministic models where chance plays no part Brand switching models are stochastic since these express brand choices in probabilities whereas linear programming is deterministic in that the relationships between variables are expressed in exact mathematical terms

THE MARKETING RESEARCH PROCESS

a Marketing Research an Introduction

Every marketer needs marketing research and most large companies have their own marketingresearch departments Marketing research involves a four-step process The first step consists ofthe manager and researcher carefully defining the problem and setting the research objectives Theobjective may be exploratory descriptive or causal The second step consists of developing the

research plan for collecting data from primary and secondary sources Primary data collection callsfor choosing a research approach (observation survey experiment) choosing a contact method(mail telephone personal) designing a sampling plan (whom to survey how many to survey andhow to choose them) and developing research instruments (questionnaire mechanical) The thirdstep consists of implementing the marketing research plan by collecting processing and analyzingthe information The fourth step consists of interpreting and reporting the findings Furtherinformation analysis helps marketing managers to apply the information and provides advancedstatistical procedures and models to develop more rigorous findings from the informationSome marketers face special marketing research considerations such as conducting research insmall-business non-profit or international situations Marketing research can be conductedeffectively by small organizations with small budgets International marketing researchers follow the same steps as domestic researchers but often face more challenging problems All organizations need to understand the major public policy and ethics issues surrounding marketing research

b Uses amp Application of Research in Marketing

Decision-making is crucial process in all types of the organization This decision-making requiresthen information that is collected and acquired through the marketing research process thisinformation can be regarding customers companies or competitor or the other environmentalfactors Major uses of the marketing research in the organizations are as following1048713 Measurement of market potential1048713 Analysis of market share1048713 Determination of market characteristics1048713 Sales analysis1048713 Product testing1048713 Forecasting1048713 Studies of business trends1048713 Studies of competitors products

c THE MARKETING RESEARCH PROCESS

Before researcher can provide managers with information they mustknow what kind of problem the manager wishes to solve Marketingresearch process has following steps1 Defining the problem and research objectives2 Developing the research plan3 Implementing the research plan and4 Interpreting and reporting the findings

Now we will discuss these steps in detail

Step 1 Defining the Problem and Research Objectives

The marketing manager and the researcher must work closely together to define the problemcarefully and agree on the research objectives Marketing managers must know enough aboutmarketing research to help in the planning and to interpret research results Defining the problemand research objectives is often the hardest step in the process After the problem has been definedcarefully the manager and researcher must set the research objectives The three general types ofobjectives are1) Exploratory research where the objective is to gather preliminary information thatwill help to better define problems and suggest hypotheses for their solution2) Descriptive research is where the intent is to describe things such as the marketpotential for a product or the demographics and attitudes of customers who buy the product3) Casual research is research to test hypotheses about cause-and-effect relationshipsThe statement of the problem and research objectives will guide the entire research process It isalways best to put the problem and research objectives statements in writing so agreement can bereached and everyone knows the direction of the research effort

Step 2 Developing the Research Plan

In developing the research plan the attempt is to determine the information needed (outlinesources of secondary data) develop a plan for gathering it efficiently and presenting the plan tomarketing management The plan spells out specific research approaches contact methodssampling plans and instruments that researchers will use to gather new data The firm shouldknow what data already exists before the process of collecting new data begins The steps thatshould be followed are Developing the research plan involves all of the following1 Determining Specific Information Needs2 Gathering Secondary Information3 Planning Primary Data Collection

1) Determine specific information needs

In this step research objectives are translatedinto specific information needs For example determine the demographic economic and lifestylecharacteristics of a target audience

2) Gathering secondary information

a) Secondary data is information that already exists somewhere having beencollected for another purpose Sources of secondary data include both internal and externalsources Companies can buy secondary data reports from outside suppliers (ie commercial datasources)Information can be obtained by using commercial online databases Examples includeCompuServe Dialog and Lexis-Nexus Many of these sources are free Advantages of secondarydata include1 It can usually be obtained more quickly and at a lower cost than primary data2 Sometimes data can be provided that an individual company could not collect on its own

Some problems with collecting secondary data include1 The needed information might not exist2 Even if the data is found it might not be useable3 The researcher must evaluate secondary information to make certain it is relevantaccurate current and impartial Secondary data is a good starting point however the company willoften have to collect primary datab) Primary data is information collected for the specific purpose at hand

Planning Primary Data Collection

A plan for primary data collection calls for a number ofdecisions on research approaches contact methods sampling plans and research instruments

Research Approaches

a) Research approaches can be listed as

1 Observational research

where information is gained by observing relevantpeople actions and situations However some things such as feelingsattitudes motives and private behavior cannot be observed Mechanicalobservation can be obtained through single source data systems This iswhere electronic monitoring systems link consumersrsquo exposure to televisionadvertising and promotion (measured using television meters) with what theybuy in stores (measured using store checkout scanners) Observationalresearch can be used to obtain information that people are unwilling orunable to provide

2 Survey research

is the gathering of primary data by asking people questionsabout their knowledge attitudes preferences and buying behavior Survey research is best suitedfor gathering descriptive information Survey research is the most widely used form of primarydata collection The major advantage of this approach is flexibility while the disadvantages includethe respondent being unwilling to respond giving inaccurate answers or unwilling to spend thetime to answer

3 Experimental research

involves the gathering of primary data by selectingmatched groups of subjects giving them different treatments controlling related factors andchecking for differences in-group responses This form of research tries to explain cause-andeffectrelationships Observation and surveys may be used to collect information in experimentalresearch This form is best used for causal information

In last Lesson we discussed the marketing research process first two steps were discussed in thatLesson today we will continue the same topic and will be discussing the remaining steps of themarketing research process Second topic of todayrsquos Lesson is an introduction to the consumer

behaviorSo our todayrsquos topics are

A THE MARKETING RESEARCH PROCESS (Continued)

B CONSUMER MARKET

Contact Methods

Contact methods are used to obtain the information Contact methods can be listed as1 Mail questionnaires--used to collect large amounts of information at a low cost2 Telephone interviewing--good method for collecting information quickly3 Personal interviewing (which can be either individual or group interviewing)A form of personal interviewing is ldquofocus group interviewingrdquoFocus-group interviewing consists of inviting six to ten people to gather for a few hours with atrained interviewer to talk about a product service or organization The interviewer ldquofocusesrdquothe group discussion on important issues4 Online (Internet) marketing research can consist of Internet surveys or online focus groupsMany experts predict that online research will soon be the primary tool of marketing researchers5 Computer interviewing is a new method being used in the technology age Consumers readquestions from a computer screen and respondSampling plans are used to outline how samples will be constructed and used1 A sample is a segment of the population selected for marketing research to represent thepopulation as a whole2 Marketing researchers usually draw conclusions about large groups of consumers bystudying a small sample of the total consumer population3 Designing a sample calls for three decisionsa Who is to be surveyed (what sampling unit)b How many people should be surveyed (what sample size)c How should the sample be chosen (what sampling procedure)4 Kinds of samples includea Probability samples--each population member has a known chance of beingincluded in the sample and researchers can calculate confidence limits for samplingerrorb Nonprobability samples--sampling error cannot be measuredResearch InstrumentsIn collecting primary data marketing researchers have a choice of two main researchinstrumentsmdashthe questionnaire and mechanical devices The questionnaire is by far the mostcommon instrument whether administered in person by phone or online Questionnaires are veryflexiblemdashthere are many ways to ask questions However they must be developed carefully andtested before they can be used on a large scale A carelessly prepared questionnaire usually containsseveral errors In preparing a questionnaire the marketing researcher must first decide what questions to askQuestionnaires frequently leave out questions that should be answered and include questions that

cannot be answered will not be answered or need not be answered Each question should bechecked to see that it contributes to the research objectivesThe form of each question can influence the response Marketing researchers distinguish betweenclosed-end questions and open-end questions Closed-end questions include all the possibleanswers and subjects make choices among them Examples include multiple-choice questions andscale questions Open-end questions allow respondents to answer in their own words Open-endquestions often reveal more than closed-end questions because respondents are not limited in theiranswers Open-end questions are especially useful in exploratory research when the researcher istrying to find out what people think but not measuring how many people think in a certain wayClosed-end questions on the other hand provide answers that are easier to interpret and tabulateResearchers should also use care in the wording and ordering of questions They should usesimple direct unbiased wording Questions should be arranged in a logical order The firstquestion should create interest if possible and difficult or personal questions should be asked lastso that respondents do not become defensiveAlthough questionnaires are the most common research instrument mechanical instruments alsoare used We discussed two mechanical instruments people meters and supermarket scannersearlier in the chapter Another group of mechanical devices measures subjects physical responses

Step 3 Implementing the Research Plan

The researcher next puts the marketing research plan into action This involves collectingprocessing and analyzing the information Data collection can be carried out by the companysmarketing research staff or by outside firms The company keeps more control over the collectionprocess and data quality by using its own staff However outside firms that specialize in datacollection often can do the job more quickly and at a lower costThe data collection phase of the marketing research process is generally the most expensive andthe most subject to error The researcher should watch fieldwork closely to make sure that the planis implemented correctly and to guard against problems with contacting respondents withrespondents who refuse to cooperate or who give biased or dishonest answers and withinterviewers who make mistakes or take shortcuts

Step 4 Interpreting and Reporting the Findings

The final step in the marketing research process is interpreting and reporting the findings Theresearchers should keep from overwhelming managers with numbers and fancy statisticaltechniques Researchers should present important findings that are useful in the major decisionsfaced by management Interpretation should not be left only to researchers Marketing managerswill also have important insights into the problems Interpretation is an important phase of themarketing process The best research is meaningless if the manager blindly accepts wronginterpretations from the researcherThe researcher must now interpret the findings draw conclusions and report them tomanagement The researcher should not try to overwhelm managers with numbers and fancystatistical techniques Rather the researcher should present important findings that are useful inthe major decisions faced by managementHowever interpretation should not be left only to the researchers They are often experts inresearch design and statistics but the marketing manager knows more about the problem and the

decisions that must be made

In many cases findings can be interpreted in different ways anddiscussions between researchers and managers will help point to the best interpretations Themanager will also want to check that the research project was carried out properly and that all thenecessary analysis was completed Or after seeing the findings the manager may have additionalquestions that can be answered through further sifting of the data Finally the manager is the onewho ultimately must decide what action the research suggests The researchers may even make thedata directly available to marketing managers so that they can perform new analyses and test newrelationships on their ownInterpretation is an important phase of the marketing process The best research is meaningless ifthe manager blindly accepts faulty interpretations from the researcher Similarly managers may bebiasedmdashthey might tend to accept research results that show what they expected and to rejectthose that they did not expect or hope for Thus managers and researchers must work togetherclosely when interpreting research results and both must share responsibility for the researchprocess and resulting decisions

RESEARCH DESIGN

Exploratory research and itrsquos methods

Exploratory research is conducted to clarify ambiguous problems Management may have discovered general problems but research is needed to gain better understanding of the dimensions of the problems Exploratory studies provide information to use in analyzing a situation but uncovering conclusive evidence to determine a particular course of action is not the purpose of exploratory research Usually exploratory research is conducted with the expectation that subsequent research will be required to provide conclusive evidence It is a serious mistake to rush into detailed surveys before less expensive and more readily available sources of information have been exhausted

In an organisation considering a program to help employees with childcare needs for example exploratory research with a small number of employees who have children might determine that many of them have spouses who also work and that these employees have positive reactions to the possibility of an on-site child-care program In such a case exploratory research helps to crystallize a problem and identify information needs for future research

Exploratory research methods

The quickest and the cheapest way to formulate a hypothesis in exploratory research is by using any of the four methods

Literature search

Experience survey

Focus group

Analysis of selected cases

Literature Search

This refers to ldquoreferring to a literature to develop a new hypothesisrdquo The literature referred are ndash trade journals professional journals market research finding publications statistical publications etc Example Suppose a problem is ldquoWhy are sales downrdquo This can quickly be analyzed with the help of published data which should indicate ldquowhether the problem is an ldquoindustry problemrdquo or a ldquofirm problemrdquo Three possibilities exist to formulate the hypothesis

The companyrsquos market share has declined but industryrsquos figures are normal

The industry is declining and hence the companyrsquos market share is also declining

The industryrsquos share is going up but the companyrsquos share is declining

If we accept the situation that our companyrsquos sales are down despite the market showing an upward trend then we need to analyse the marketing mix variables

Example 1 A TV manufacturing company feels that its market share is declining whereas the overall television industry is doing very well

Example 2 Due to a trade embargo imposed by a country textiles exports are down and hence sales of a company making garment for exports is on the decline

The above information may be used to pinpoint the reason for declining sales

Experience Survey

In experience surveys it is desirable to talk to persons who are well informed in the area being investigated These people may be company executives or persons outside the organisation Here no questionnaire is required The approach adopted in an experience survey should be highly unstructured so that the respondent can give divergent views Since the idea of using experience survey is to undertake problem formulation and not conclusion probability sample need not be used Those who cannot speak freely should be excluded from the sample

Examples

1) A group of housewives may be approached for their choice for a ldquoready to cook productrdquo

2) A publisher might want to find out the reason for poor circulation of newspaper introduced recently He might meet (a) Newspaper sellers (b) Public reading room (c) General public (d) Business community etc

These are experienced persons whose knowledge researcher can use

Focus Group

Another widely used technique in exploratory research is the focus group In a focus group a small number of individuals are brought together to study and talk about some topic of interest The discussion is co-ordinated by a moderator The group usually is of 8-12 persons While selecting these persons care has to be taken to see that they should have a common background and have similar experiences in buying This is required because there should not be a conflict among the group members on the common issues that are being discussed During the discussion future buying attitudes present buying opinion etc are gathered

Most of the companies conducting the focus groups first screen the candidates to determine who will compose the particular group Firms also take care to avoid groups in which some of the participants have their friends and relatives because this leads to a biased discussion Normally a number of such groups are constituted and the final conclusion of various groups are taken for formulating the hypothesis Therefore a key factor in focus group is to have similar groups Normally there are 4-5 groups Some of them may even have 6-8 groups The guiding criteria is to see whether the latter groups are generating additional ideas or repeating the same with respect to the subject under study When this shows a diminishing return from the group the discussions stopped The typical focus group lasts for 1-30 hours to 2 hours The moderator under the focus group has a key role His job is to guide the group to proceed in the right direction

Analysis of selected cases

Analysing a selected case sometimes gives an insight into the problem which is being researched Case histories of companies which have undergone a similar situation may be available These case studies are well suited to carry out exploratory research However the result of investigation of case histories arc always considered suggestive rather than conclusive In case of preference to ldquoready to eat foodrdquo many case histories may be available in the form of previous studies made by competitors We must carefully examine the already published case studies with regard to other variables such as price advertisement changes in the taste etc

II DESCRIPTIVE RESEARCH AND ITrsquoS METHODS

Descriptive research is used to obtain information concerning the current status of the phenomena to describe ldquowhat existsrdquo with respect to variables or conditions in a situation The methods involved range from the survey which describes the status quo the correlation study which investigates the relationship between variables to developmental studies which seek to determine changes over time

Descriptive Research Methods

1 Case Studies

Detailed analysis of a single (or limited number) of people or events Case studies are usually interesting because of the unusualness of the case The major problem with case studies is the problem of objectivity The person who is presenting the case usually has some theoretical orientation It is acceptable for a theoretical orientation to affect onersquos interpretation of events In a case study the theoretical orientation can also lead to the selection of the facts to include in the case It is not surprising that case studies often seem to provide very compelling evidence for a theory Case studies can therefore assist psychology by illustrating how a theory could be applied to a person or events and by assisting with the development of hypotheses for more systematic testing

2 Observational Research

Accounts of the natural behavior of individuals or groups in some setting Unless the observation is unobtrusive there may be some subject reactivity to being observed This often decreases with time a process called habituation Observers cannot usually observe all behaviors all of the time They may use a behavioral checklist and may also use time sampling or event sampling procedures It is important to assess observer bias by the use of interobserver reliability Observational research may also pose ethical problems These can arise when the behaviors being observed are not public behaviors and when the observer joins a group in order to observe the membersrsquo behavior ndash participant observation

3 Survey Research

Structured questions to assess peoples beliefs attitudes and self-reports of behavior If the researcher wishes to generalize the responses to a population it is important to have a representative sample Surveys that rely on self-selection (respond if you are interested) produce non-generalizable results Surveys also provide information for co relational research One can correlate responses to some questions (often demographic questions) with responses to other questions (often attitudes or reports of behavior) Survey question must be clear and unambiguous Even if the questions are unambiguous and non-leading people may display a social desirability bias and give positive or socially acceptable and desirable answers Survey methods include (1) the interview or face-to-face method which is generally viewed as the best method for obtaining a high rate of responses but is also very costly (2) phone surveys which are less expensive but have a higher non-response rate (which has probably increased with caller ID) and (3) written or mail surveys which are least expensive but have a very high non-response rate Follow-up messages can help increase the response rate

4 Archival Research

Analysis of pre-existing data or records Archival research often involves content analysis a qualitative analysis of material For example one would use content analysis to determine whether there had been an increase in the frequency with which women and minorities were mentioned in US history books between 1920 and 2000 Some archival research is quasi-experimental

III EXPERIMENTAL RESEARCH AND ITrsquoS STAGES

Science revolves around experiments and learning the best way of conducting an experiment is crucial to obtaining useful and valid results When scientists speak of experiments in the strictest sense of the word they mean a true experiment where the scientist controls all of the factors and conditions Real world observations and case studies should be referred to as observational research rather than experiments For example observing animals in the wild is not a true experiment because it does not isolate and manipulate an independent variable

THE BASIS OF CONDUCTING AN EXPERIMENT

With an experiment the researcher is trying to learn something new about the world an explanation of lsquowhyrsquo something happens The experiment must maintain internal and external validity or the results will be useless When designing an experiment a researcher must follow all of the steps of the scientific method from making sure that the hypothesis is valid and testable to using controls and statistical tests

Whilst all scientists use reasoning operationalization and the steps of the scientific process it is not always a conscious process Experience and practice mean that many scientists follow an instinctive process of conducting an experiment the lsquostreamlinedrsquo scientific process Following the basic steps will usually generate valid results but where experiments are complex and expensive it is always advisable to follow the rigorous scientific protocols

Conducting a experiment has a number of stages where the parameters and structure of the experiment are made clear Whilst it is rarely practical to follow each step strictly any aberrations must be justified whether they arise because of budget impracticality or ethics

STAGE ONE

After deciding upon a hypothesis and making predictions the first stage of conducting an experiment is to specify the sample groups These should be large enough to give a statistically viable study but small enough to be practical Ideally groups should be selected at random from a wide selection of the sample population This allows results to be generalized to the population as a whole In the physical sciences this is fairly easy but the biological and behavioral sciences are often limited by other factors

For example medical trials often cannot find random groups Such research often relies upon volunteers so it is difficult to apply any realistic randomization This is not a problem as long as the process is justified and the results are not applied to the population as a whole If a psychological researcher used volunteers who were male students aged between 18 and 24 the findings can only be generalized to that specific demographic group within society

STAGE TWO

The sample groups should be divided into a control group and a test group to reduce the possibility of confounding variables This again should be random and the assigning of subjects to groups should be blind or double blind This will reduce the chances of experimental error or bias when conducting an experiment

Ethics are often a barrier to this process because deliberately withholding treatment is not permitted Again any deviations from this process must be explained in the conclusion There is nothing wrong with compromising upon randomness where necessary as long as other scientists are aware of how and why the researcher selected groups on that basis

STAGE THREE

This stage of conducting an experiment involves determining the time scale and frequency of sampling to fit the type of experiment For example researchers studying the effectiveness of a cure for colds would take frequent samples over a period of days Researchers testing a cure for Parkinsonrsquos disease would use less frequent tests over a period of months or years

STAGE FOUR

The penultimate stage of the experiment involves performing the experiment according to the methods stipulated during the design phase The independent variable is manipulated generating a usable data set for the dependent variable

STAGE FIVE

The raw data from the results should be gathered and analyzed by statistical means This allows the researcher to establish if there is any relationship between the variables and accept or reject the null hypothesis

These steps are essential to providing excellent results Whilst many researchers do not want to become involved in the exact processes of inductive reasoning deductive reasoning and operationalization they all follow the basic steps of conducting an experiment This ensures that their results are valid

to marketing manager for his consideration and final selectiondecision It is rightly said that the beginning and end of marketing management is marketing research Decisions on each element of the marketing mix-product price distribution and promotion-need marketing research support Marketing research is primarily used to provide information needed to guide marketing decision viz market mix It acts as a support system to marketing management

DEFINITIONS OF MARKETING RESEARCH

Let us now consider some definitions of MR(1) The most widely accepted definition of marketing research is given by American Marketing Association (AMA) The AMA has defined marketing research as the systematic gathering recording and analyzing of data about problems relating to the marketing of goods and servicesrdquo(2) According to Richard D Crisp Marketing research is the systematic objective and exhaustive search for and study of the facts relevant to any problem in the field of marketing(3) According to Philip Kotler Marketing research is systematic problem analysis model building and fact-finding for the purpose of improved decision-making and control in the marketing of goods and services(4) Luck Wales and Taylor have defined marketing research as the application of scientific method to the solution of marketing problems(5) Green and Tull have defined marketing research as the systematic and objective search for and analysis of information relevant to the identification and solution of any problem in the field of marketing(6) British Institute of Management In 1962 the British Institute of Management defined marketing research as The objective gathering recording and analyzing of all facts about problems relating to the transfer and sales of goods and services from producer to consumer

FEATURES OF MARKETING RESEARCH

(a) Marketing research is concerned with systematic gathering recording and analyzing of information In MR information that is relevant to the marketing problem is collected in a systematic manner from all available sources Thereafter the same is tabulated and recorded for systematic scrutiny Such scrutiny will offer certain specific conclusions useful for solving the marketing problem

(b) In MR information is to be collected objectively and accurately This feature of MR suggests that the required information needs to be collected objectively In brief the information collected should be accurate precise relevant and properly verified The conclusions drawn and the remedial measures introduced will be ineffective if the information collected is not reliable

(c) Marketing research is a tool for solving marketing problems MR is a means and not the end in itself It is a tool in the hands of management for identifying and analyzing marketing problems The purpose is to solve them correctly

CHARACTERISTICS OF MARKETING RESEARCH(1) Systematic and continuous process MR is a continuous process This is natural as new marketing problems are bound to come from time to time in the course of marketing of goods and services One type of research is not adequate to resolve all marketing problems Similarly new research projects will have to be undertaken to solve new marketing problems and challenges A marketing company faces new marketing problems from time to time For facing these problems marketing research activities need to be conducted on a regular basis A marketing company has to conduct MR regularly for its survival amp growth in the present dynamic marketing environment(2) Widecomprehensive in scope and application MR is wide in scope as it deals with all aspects of marketing of goods and services It is more than just collecting data on marketing Introduction of new products identification of potential markets selection of appropriate selling techniques study of market competition and consumer preferences introduction of suitable advertising strategy and sales promotion measures are some areas covered by MR It plays a role in all the three phases of the management process in marketing planning implementation and evaluation(3) Emphasizes on accurate data collection and critical analysis In MR required data should be collected objectively and accurately The data collected must be reliable It should be analyzed in a systematic manner This will provide comprehensive picture of the situation and possible solutions(4) Offers benefits to sponsoring company and consumers MR is useful to the sponsoring company It raises the turnover and profit of the company It also raises the competitive capacity and creates goodwill in the market It enables a company to introduce consumer-oriented marketing policies Consumers also get agreeable goods and more satisfaction due to MR activities(5) Commercial equivalent of military intelligence MR is the commercial intelligence activity It is similar to military intelligence where systematic study is made before taking any military action MR acts as the intelligence tool of marketing management(6) Tool for managerial decisions MR acts as a tool in the hands of management for identifying and analyzing marketing problems and finding out solutions to them It is an aid to decision-making It suggests possible solutions for the consideration and selection by managers MR is an aid to judgment and never a substitute for it(7) Applied type of research MR is applied knowledge It is also called decisional research as it provides specific alternative solutions to deal with a specific marketing problem It studies specific marketing problem and suggests alternative solutions and possible outcome of each alternative In addition it is both science and an art MR is also becoming highly professional activity(8) Reduces the gap between the producers and consumers MR is an essential supplement of modern competitive marketing It is useful for understanding the needs and expectations of consumers It reduces the gap between producers and consumers and adjusts the marketing activities to suit the needs of consumers(9) Not an exact science MR is both science and an art It collects information and studies marketing problem in a scientific manner The information collected is also applied to real lire problem However MR is not an exact science It only suggests possible solutions and not the exact solution to marketing manager for consideration and selection At present MR is treated as a professional activity We have professional agencies (MR agencies or advertising agencies) dealing with the marketing problems of their clients on commission basis(10) Use of different methods MR can be conducted by using different methods Data can be collected through survey or by other methods like observation method or experimentation method Even computers and internet are used for data collection The researcher has to decide the method

that is suitable for the conduct of research project This selection is important as the use of unsuitable methods affect the quality of research work(11) Dynamic character MR is dynamic in nature Its scope is fast expanding along with the new developments in the field of marketing This is natural as MR is essentially for dealing with new problems and challenges in the field of marketing In addition developments in other subjects such as economics statistics computer science sociology psychology cultural anthropology and behavioral sciences also bring corresponding changes in the field of MR New methods new techniques etc are used while conducting the research activities This suggests that MR is a dynamic and progressive subject with new developments taking place regularly(12) Closely connected with marketing information system Both the concepts are interrelated In fact MR is one component of MIS Both are useful for solving marketing problems and for accurate and quick decision-making in the field of marketing(13) Phenomenal growth MR has made a phenomenal growth since its inception It has become an important tool in the hands of management (to solve marketing problems) along with the advent of consumer-oriented philosophy in modern business The increasing research budgets of companies are the indicators of its tremendous growth in recent years

AIMS AND OBJECTIVES OF MARKETING RESEARCHThe aims of the marketing research and analysis may be stated as follows(1) To study the needs wants and expectations of consumers(2) To find out reactions of consumers to the products of the company(3) To evaluate companys sales promotion measures for suitable adjustment and improvement(4) To study current marketing problems and opportunities for suitable follow-up actions(5) To suggest the introduction of new products modifications of existing products and to discover new uses of existing products(6) To design and test appropriate packages of companys products and make packaging as attractive as possible(7) To study existing pricing channels of distribution and market competition for suitable changes if necessary(8) To find out methods for making the products of the company popular and raising its goodwill and market reputation(9) To assess competitive strength and policies(10) To estimate potential buying-power in various areas(11) To know the companys expected share of the market(12) To determine the dimensions of the marketing problems facilitate evaluation of the alternative solutions of different problems and help in the selection of a right course of action(13) To define the probable market for a specialized product and to report on general market conditions and tendencies buying habits etc

MARKET RESEARCH VS MARKETING RESEARCHThe two terms ldquomarket research and marketing research are used interchangeably though there is difference in the meaning and scope of the two terms Market research is used as a popular synonym for marketing research Market is a part of marketing and market research is only a part of marketing research It covers only a few aspects of marketing According to Philip Kotler the term market research is accurate for describing research into the market its size geographical

distribution income and so on However it fails to cover the idea of research into the effects of marketing efforts on the market for which the term marketing research is more accurate MR is increasingly coming into favor as the term that describes both ideas Marketing research need not be treated as pure academic research It is a type of applied research with scientific orientation

Distinction between market research and marketing research

DimensionMarket ResearchMarketing ResearchMeaningMarket research directly relates to market situation ie size location market competition and features of customers It provides details about the market for decision-making and policy framingMarketing research is a systematic and comprehensive searchstudy of different aspects of marketing - including the current marketing problems and challenges for decision-making amp policy framingNatureMarket research is a branch of marketing research

Marketing research is one branch of Marketing Information SystemScopeThe scope of market research is limitedrestricted to the study of market or market situation

The scope of marketing research is comprehensive amp wide as it covers all aspects of marketingType of termMarket research is a narrow term as it relates to one aspect of marketing

Marketing research is a widebroad term as it covers all aspects of marketingObjectiveMarket research is undertaken in order to deal with the problems and challenges relating to different aspects of market such as competition market demand and consumer needs

Marketing research is undertaken in order to study varied types of marketing problems such as product line marketing mix advertising packaging branding and so on

GROWING IMPORTANCE OF MARKETING RESEARCH

Marketing research has received attention and importance along with the growth of highly competitive consumer-oriented marketing philosophy Research activities in different aspects of marketing are necessary and useful in such competitive and flexible marketing environment Large companies marketing consumer items noted the growing need of MR activities in the marketing decision-making process They naturally took initiative in conducting research activities within the organization itself This was followed by the formation of specialized marketing research agencies and advertising agencies for this purpose This is how professional orientation was given to MR

Many marketing research departments and agencies were established after World War II

MR activity (as we understand today) is comparatively new in the field of marketing This activity probably began around 1950s (Modern era of marketing research) and attracted the attention of companies interested in marketing their products in the national and global markets However the concept of MR got firm roots in the marketing activity after 1910 First time the marketing research techniques were used by newspapers to predict the election results However during the second decade of 20th century marketing research emerged as a valuable management tool to solve marketing problems In the developed countries marketing research activity is conducted on scientific lines Even in India large manufacturing companies treat marketing research as an essential supplement of planning and decision-making in the marketing field It is treated as an indispensable tool for profitable and consumer-oriented marketing The popularity of MR increased after 1960 due to the introduction of computers in data collection and analysis In the early period marketing research activities were confined to market studies only but in 1950s research relating to marketing activities was broadened to include all managerial aspects-price produce place and promotion In late 1950s motivational and psychological techniques were introduced to generate more information on consumers

Several factors have contributed to the growing importance of marketing research For example due to large-scale production producers could not have direct contact with the consumers This created many problems before producers For solving all such problems developed due to the gap between producers and consumer and marketing research activities prove to be useful

Secondly the shifting from sellersrsquo market to buyers market made it necessary to have better understanding about consumer net-expectations For this marketing research proved to be useful

Thirdly the introduction of computers has contributed to the growth of marketing research activity

Fourthly rapid changes in the business environment shift to consumer-oriented philosophy in business are also responsible for growing importance of marketing research

Finally the scope of marketing has widened due to population growth and development of rural markets MR proved to be useful for dealing with the problems created by national and global markets In brief growing importance of marketing research in the present marketing system is the net result of various factors and forces available in the present marketing system At present MR activities are undertaken by marketing companies on their own In addition marketing research consultants and agencies provide expert advice to companies on general and specific marketing problems of their clients

Relevance of MR under GlobalizationThe business world is fast moving towards globalization in which all countries participate Every country has to face competition in the domestic as well as in export marketing Survival in the global business is possible through quality improvement cost reduction and by attracting consumers through various sales promotion techniques Here MR offers helping hand to companies It offers

suggestions for survival under global competitive environment In brief the importancerelevance of MR is fast growing along with the globalization of business It is a must for survival and growth under globalization Current marketing scenario is different as compared to traditional one There is a new trend towards liberalization and globalization Markets (domestic as well as foreign) are becoming highly competition New companies and new products re entering in the markets Survival is difficult under the present marketing environment Here MR offers various services It is now a professional activity with new developments in regard to scopecoverage and techniques In brief MR has great relevance in the current marketing scenario in India as well as in all countries- developed and developing of the world MR has enormous capacity to help and guide marketing companies in regard to their marketing problems and challenges

FUNCTIONS OF MARKETING RESEARCHMR performs five basic functions These are Description evaluation explanation prediction and finally aid in decision-making These functions are related to the research project undertaken Usually every research study performs all the five functions explained below(1) Description MR provides data and gives informationdescription of customers who buy the product This includes information about their agesex education income and the amount of money that they are willing to spend on the product Description of the customers is useful in order to draw certain conclusions about the customers and their buying behavior Even marketing strategies can be decided as per the information available(2) Evaluation MR is useful for understanding the viewsreactions of the buyers This includes views of consumers on packaging advertisingsales promotion measures used A manufacturer gets these details as well as the information about his product in comparison with the products of his competitors This facilitates evaluation of the marketing policies For example how far the packaging of the product is attractive to consumers or superior as compared to packaging by competitors and so on(3) Explanation MR gives explanation to certain questions of a manufacturer It may be related to decline in sales retailers negative reaction or resistance of consumers in a particular marketing area MR enables a manufacturer to understand why sales are reducing (causes) or why the response of the retailers is negative or why consumers in a particular region are not willing to purchase a specific product Such explanation is important as it enables a manufacturer to adjust his marketing policies in order to rectify the prevailing unfavorable situation(4) Prediction MR conducts prediction function Such predictions may be related to consumers market environmentmarket competition possible socio-economic changes and so on This prediction function enables a manufacturer to understand how much people will spend on the specific product in the next year or the fashions that consumers may prefer in the next year In addition prediction about the possible turnover in the years to come is also possible through suitable marketing research studies In brief marketing research is useful for understanding the marketing environment likely to develop in future This facilitates proper adjustment in the marketing policies for the future period In this sense the prediction function is important even when all predictions made through research studies may not prove to be fully correct However the trend indicated can be used for appropriate policy decisions(5) Aid in Decision-making One more function of MR is to facilitate the process of decision-making in the marketing field MR guides the manufacturer as regards the manner in which he can make

effective advertising appeal or create incentive among his salesmendistributors It also gives him guidance as regards price fixation and sales promotion techniques that will be useful for the future period This function of marketing research is closely related to other functions that it performs These functions facilitate reasonably correct decision-making by marketing managers

They also suggest the practical utility of MR activities

MR functions provide feedback (information and guidance) to marketing managers and improve the quality of their decision-making This practice is certainly safer as compared to decision-making on the basis of past experience or intuition When reality is complex and many facts are not detectable intuition is not adequate for decision-making Similarly experience is useful but decisions on experience alone may not be accurate

Large companies and professional executives prefer to resort to marketing research than depending on experience This is because information available is based on real data and is more reliable dependable This facilitates correct decision-making Thus marketing executives should prefer decisions on the basis of information supplied through marketing research Such decisions are likely to be more accurate as they are based on actual market situation

In brief the basic function of MR is to support marketing decision-making process Marketing research does not provide ready-made decisions or exact solutions on all marketing problems It only provides the clues or possible solutions that should be taken into consideration in the decision-making process It provides support to skills and abilities of marketing managers

The different functions of marketing research are supplementary in character These functions enable a manufacturer to keep close touch with the marketing situation and enable him to make suitable changes in his marketing policies and programmers They also suggest the role marketing research activity in modern competitive and consumer oriented marketing Marketing research functions certainly improve the quality of decision-making by marketing managers

ADVANTAGESIMPORTANCE OF MARKETING RESEARCH1 Indicates current market trends Marketing research keeps business unit in touch with the current market trends and offers guidance for facing market situation with confidence2 Pinpoints deficiencies in marketing policies MR pinpoints the deficiencies as regards products pricing promotion etc It gives guidance regarding different aspects of marketing They include product development branding packaging and advertising3 Explains customer resistance MR is useful for finding out customer resistance to companys products The researcher also suggests remedial measures to deal with the situation This makes the products and marketing policies agreeable to consumers4 Suggests sales promotion techniques MR enables a manufacturer to introduce appropriate sales promotion techniques select most convenient channel of distribution suitable pricing policy for the products and provision of discounts and concessions to dealers Marketing research facilitates sales promotion5 Offers guidance to marketing executives MR offers information and guidance to marketing

executives while framing marketing policies Continuous research enables a company to face adverse marketing situation boldly It acts as an insurance against possible changes in market environment6 Facilitates selection and training of sales force Marketing research is useful for the selection and training of staff in the sales organization It also suggests the incentives that should be offered for motivation of employees concerned with marketing7 Promotes business activities Marketing research enables a business unit to growexpand its activities It creates goodwill in the market and also enables a business unit to earn high profits through consumer-oriented marketing policies and programmers8 Facilitates appraisal of marketing policies Research activities enable business executives to have an appraisal of the present marketing policies in the light of findings of research work Suitable adjustments in the policies are also possible as per the suggestions made by the researchers9 Suggests new marketing opportunities MR suggests new marketing opportunities and the manner in which they can be exploited fully It identifies emerging market opportunities10 Facilitates inventory study Marketing research is useful for the evaluation of companyrsquos inventory policies and also for the introduction of more efficient ways of managing inventories including finished goods and raw materials11 Provides marketing information MR provides information on various aspects of marketing It suggests relative strengths and weaknesses of the company On the basis of such information marketing executives find it easy to frame policies for the future period MR provides information guidance and alternative solutions to current marketing problems12 Suggests appropriate distribution channels MR can be used to study the effectiveness of existing channels of distribution and the need of making suitable changes in the distribution system13 Provides information on product acceptance Marketing research helps in knowing the probability of acceptance of the product in its present form It is also useful for the introduction of modifications in the existing product line of a firm14 Creates progressive outlook MR generates a progressive and dynamic outlook throughout the business organization It promotes systematic thinking and a sense of professionalization within the company It also creates enthusiasm among marketing executives This brings success and stability to the whole business unit15 Has wider social significance MR is of paramount importance from the social angle It is the means by which the ultimate consumer literally becomes king of the market place with his desires prejudices and every whim transmitted to the producer and distributor In brief MR has wider social significance It is useful to all parties involved in the process of marketing

A marketing information system (MIS) is intended to bring together disparate items of data into a coherent body of information An MIS is as will shortly be seen more than raw data or information suitable for the purposes of decision making An MIS also provides methods for interpreting the information the MIS provides Moreover as Kotlers1 definition says an MIS is more than a system of data collection or a set of information technologies

A marketing information system is a continuing and interacting structure of people equipment and procedures to gather sort analyse evaluate and distribute pertinent timely and accurate information for use by marketing decision makers to improve their marketing planning implementation and control

Figure 91 illustrates the major components of an MIS the environmental factors monitored by the system and the types of marketing decision which the MIS seeks to underpin

Figure 91 The marketing information systems and its subsystems

The explanation of this model of an MIS begins with a description of each of its four main constituent parts the internal reporting systems marketing research system marketing intelligence system and marketing models It is suggested that whilst the MIS varies in its degree of sophistication - with many in the industrialised countries being computerised and few in the developing countries being so - a fully fledged MIS should have these components the methods (and technologies) of collection storing retrieving and processing data notwithstanding

Internal reporting systems All enterprises which have been in operation for any period of time nave a wealth of information However this information often remains under-utilised because it is compartmentalised either in the form of an individual entrepreneur or in the functional departments of larger businesses That is information is usually categorised according to its nature so that there are for example financial production manpower marketing stockholding and logistical data Often the entrepreneur or various personnel working in the functional departments holding these pieces of data do not see how it could help decision makers in other functional areas Similarly decision makers can fail to appreciate how information from other functional areas might help them and therefore do not request it

The internal records that are of immediate value to marketing decisions are orders received stockholdings and sales invoices These are but a few of the internal records that can be used by marketing managers but even this small set of records is capable of generating a great deal of information Below is a list of some of the information that can be derived from sales invoices

middot Product type size and pack type by territorymiddot Product type size and pack type by type of accountmiddot Product type size and pack type by industrymiddot Product type size and pack type by customermiddot Average value andor volume of sale by territorymiddot Average value andor volume of sale by type of accountmiddot Average value andor volume of sale by industrymiddot Average value andor volume of sale by sales person

By comparing orders received with invoices an enterprise can establish the extent to which it is providing an acceptable level of customer service In the same way comparing stockholding records with orders received helps an enterprise ascertain whether its stocks are in line with current demand patterns

Marketing research systems The general topic of marketing research has been the prime subject of the textbook and only a little more needs to be added here Marketing research is a proactive search for information That is the enterprise which commissions these studies does so to solve a perceived marketing problem In many cases data is collected in a purposeful way to address a well-defined problem (or a problem which can be defined and solved within the course of the study) The other form of marketing research centres not around a specific marketing problem but is an attempt to continuously monitor the marketing environment These monitoring or tracking exercises are continuous marketing research studies often involving panels of farmers consumers or distributors from which the same data is collected at regular intervals Whilst the ad hoc study and continuous marketing research differs in the orientation yet they are both proactive

Marketing intelligence systems Whereas marketing research is focused market intelligence is not A marketing intelligence system is a set of procedures and data sources used by marketing managers to sift information from the environment that they can use in their decision making This scanning of the economic and business environment can be undertaken in a variety of ways including2

Unfocused scanning

The manager by virtue of what heshe reads hears and watches exposes himherself to information that may prove useful Whilst the behaviour is unfocused and the manager has no specific purpose in mind it is not unintentional

Semi-focused scanning

Again the manager is not in search of particular pieces of information that heshe is actively searching but does narrow the range of media that is scanned For instance the manager may focus more on economic and business publications broadcasts etc and pay less attention to political scientific or technological media

Informal search

This describes the situation where a fairly limited and unstructured attempt is made to obtain information for a specific purpose For example the marketing manager of a firm considering entering the business of importing frozen fish from a neighbouring country may make informal inquiries as to prices and demand levels of frozen and fresh fish There would be little structure to this search with the manager making inquiries with traders heshe happens to encounter as well as with other ad hoc contacts in ministries international aid agencies with trade associations importersexporters etc

Formal search

This is a purposeful search after information in some systematic way The information will be required to address a specific issue Whilst this sort of activity may seem to share the characteristics of marketing research it is carried out by the manager himherself rather than a professional researcher Moreover the scope of the search is likely to be narrow in scope and far less intensive than marketing research

Marketing intelligence is the province of entrepreneurs and senior managers within an agribusiness It involves them in scanning newspaper trade magazines business journals and reports economic forecasts and other media In addition it involves management in talking to producers suppliers and customers as well as to competitors Nonetheless it is a largely informal process of observing and conversing

Some enterprises will approach marketing intelligence gathering in a more deliberate fashion and will train its sales force after-sales personnel and districtarea managers to take cognisance of competitors actions customer complaints and requests and distributor problems Enterprises with vision will also encourage intermediaries such as collectors retailers traders and other middlemen to be proactive in conveying market intelligence back to them

Marketing models Within the MIS there has to be the means of interpreting information in order to give direction to decision These models may be computerised or may not Typical tools are

middot Time series sales modesmiddot Brand switching modelsmiddot Linear programmingmiddot Elasticity models (price incomes demand supply etc)middot Regression and correlation modelsmiddot Analysis of Variance (ANOVA) modelsmiddot Sensitivity analysismiddot Discounted cash flowmiddot Spreadsheet what if models

These and similar mathematical statistical econometric and financial models are the analytical subsystem of the MIS A relatively modest investment in a desktop computer is enough to allow an enterprise to automate the analysis of its data Some of the models used are stochastic ie those containing a probabilistic element whereas others are deterministic models where chance plays no part Brand switching models are stochastic since these express brand choices in probabilities whereas linear programming is deterministic in that the relationships between variables are expressed in exact mathematical terms

THE MARKETING RESEARCH PROCESS

a Marketing Research an Introduction

Every marketer needs marketing research and most large companies have their own marketingresearch departments Marketing research involves a four-step process The first step consists ofthe manager and researcher carefully defining the problem and setting the research objectives Theobjective may be exploratory descriptive or causal The second step consists of developing the

research plan for collecting data from primary and secondary sources Primary data collection callsfor choosing a research approach (observation survey experiment) choosing a contact method(mail telephone personal) designing a sampling plan (whom to survey how many to survey andhow to choose them) and developing research instruments (questionnaire mechanical) The thirdstep consists of implementing the marketing research plan by collecting processing and analyzingthe information The fourth step consists of interpreting and reporting the findings Furtherinformation analysis helps marketing managers to apply the information and provides advancedstatistical procedures and models to develop more rigorous findings from the informationSome marketers face special marketing research considerations such as conducting research insmall-business non-profit or international situations Marketing research can be conductedeffectively by small organizations with small budgets International marketing researchers follow the same steps as domestic researchers but often face more challenging problems All organizations need to understand the major public policy and ethics issues surrounding marketing research

b Uses amp Application of Research in Marketing

Decision-making is crucial process in all types of the organization This decision-making requiresthen information that is collected and acquired through the marketing research process thisinformation can be regarding customers companies or competitor or the other environmentalfactors Major uses of the marketing research in the organizations are as following1048713 Measurement of market potential1048713 Analysis of market share1048713 Determination of market characteristics1048713 Sales analysis1048713 Product testing1048713 Forecasting1048713 Studies of business trends1048713 Studies of competitors products

c THE MARKETING RESEARCH PROCESS

Before researcher can provide managers with information they mustknow what kind of problem the manager wishes to solve Marketingresearch process has following steps1 Defining the problem and research objectives2 Developing the research plan3 Implementing the research plan and4 Interpreting and reporting the findings

Now we will discuss these steps in detail

Step 1 Defining the Problem and Research Objectives

The marketing manager and the researcher must work closely together to define the problemcarefully and agree on the research objectives Marketing managers must know enough aboutmarketing research to help in the planning and to interpret research results Defining the problemand research objectives is often the hardest step in the process After the problem has been definedcarefully the manager and researcher must set the research objectives The three general types ofobjectives are1) Exploratory research where the objective is to gather preliminary information thatwill help to better define problems and suggest hypotheses for their solution2) Descriptive research is where the intent is to describe things such as the marketpotential for a product or the demographics and attitudes of customers who buy the product3) Casual research is research to test hypotheses about cause-and-effect relationshipsThe statement of the problem and research objectives will guide the entire research process It isalways best to put the problem and research objectives statements in writing so agreement can bereached and everyone knows the direction of the research effort

Step 2 Developing the Research Plan

In developing the research plan the attempt is to determine the information needed (outlinesources of secondary data) develop a plan for gathering it efficiently and presenting the plan tomarketing management The plan spells out specific research approaches contact methodssampling plans and instruments that researchers will use to gather new data The firm shouldknow what data already exists before the process of collecting new data begins The steps thatshould be followed are Developing the research plan involves all of the following1 Determining Specific Information Needs2 Gathering Secondary Information3 Planning Primary Data Collection

1) Determine specific information needs

In this step research objectives are translatedinto specific information needs For example determine the demographic economic and lifestylecharacteristics of a target audience

2) Gathering secondary information

a) Secondary data is information that already exists somewhere having beencollected for another purpose Sources of secondary data include both internal and externalsources Companies can buy secondary data reports from outside suppliers (ie commercial datasources)Information can be obtained by using commercial online databases Examples includeCompuServe Dialog and Lexis-Nexus Many of these sources are free Advantages of secondarydata include1 It can usually be obtained more quickly and at a lower cost than primary data2 Sometimes data can be provided that an individual company could not collect on its own

Some problems with collecting secondary data include1 The needed information might not exist2 Even if the data is found it might not be useable3 The researcher must evaluate secondary information to make certain it is relevantaccurate current and impartial Secondary data is a good starting point however the company willoften have to collect primary datab) Primary data is information collected for the specific purpose at hand

Planning Primary Data Collection

A plan for primary data collection calls for a number ofdecisions on research approaches contact methods sampling plans and research instruments

Research Approaches

a) Research approaches can be listed as

1 Observational research

where information is gained by observing relevantpeople actions and situations However some things such as feelingsattitudes motives and private behavior cannot be observed Mechanicalobservation can be obtained through single source data systems This iswhere electronic monitoring systems link consumersrsquo exposure to televisionadvertising and promotion (measured using television meters) with what theybuy in stores (measured using store checkout scanners) Observationalresearch can be used to obtain information that people are unwilling orunable to provide

2 Survey research

is the gathering of primary data by asking people questionsabout their knowledge attitudes preferences and buying behavior Survey research is best suitedfor gathering descriptive information Survey research is the most widely used form of primarydata collection The major advantage of this approach is flexibility while the disadvantages includethe respondent being unwilling to respond giving inaccurate answers or unwilling to spend thetime to answer

3 Experimental research

involves the gathering of primary data by selectingmatched groups of subjects giving them different treatments controlling related factors andchecking for differences in-group responses This form of research tries to explain cause-andeffectrelationships Observation and surveys may be used to collect information in experimentalresearch This form is best used for causal information

In last Lesson we discussed the marketing research process first two steps were discussed in thatLesson today we will continue the same topic and will be discussing the remaining steps of themarketing research process Second topic of todayrsquos Lesson is an introduction to the consumer

behaviorSo our todayrsquos topics are

A THE MARKETING RESEARCH PROCESS (Continued)

B CONSUMER MARKET

Contact Methods

Contact methods are used to obtain the information Contact methods can be listed as1 Mail questionnaires--used to collect large amounts of information at a low cost2 Telephone interviewing--good method for collecting information quickly3 Personal interviewing (which can be either individual or group interviewing)A form of personal interviewing is ldquofocus group interviewingrdquoFocus-group interviewing consists of inviting six to ten people to gather for a few hours with atrained interviewer to talk about a product service or organization The interviewer ldquofocusesrdquothe group discussion on important issues4 Online (Internet) marketing research can consist of Internet surveys or online focus groupsMany experts predict that online research will soon be the primary tool of marketing researchers5 Computer interviewing is a new method being used in the technology age Consumers readquestions from a computer screen and respondSampling plans are used to outline how samples will be constructed and used1 A sample is a segment of the population selected for marketing research to represent thepopulation as a whole2 Marketing researchers usually draw conclusions about large groups of consumers bystudying a small sample of the total consumer population3 Designing a sample calls for three decisionsa Who is to be surveyed (what sampling unit)b How many people should be surveyed (what sample size)c How should the sample be chosen (what sampling procedure)4 Kinds of samples includea Probability samples--each population member has a known chance of beingincluded in the sample and researchers can calculate confidence limits for samplingerrorb Nonprobability samples--sampling error cannot be measuredResearch InstrumentsIn collecting primary data marketing researchers have a choice of two main researchinstrumentsmdashthe questionnaire and mechanical devices The questionnaire is by far the mostcommon instrument whether administered in person by phone or online Questionnaires are veryflexiblemdashthere are many ways to ask questions However they must be developed carefully andtested before they can be used on a large scale A carelessly prepared questionnaire usually containsseveral errors In preparing a questionnaire the marketing researcher must first decide what questions to askQuestionnaires frequently leave out questions that should be answered and include questions that

cannot be answered will not be answered or need not be answered Each question should bechecked to see that it contributes to the research objectivesThe form of each question can influence the response Marketing researchers distinguish betweenclosed-end questions and open-end questions Closed-end questions include all the possibleanswers and subjects make choices among them Examples include multiple-choice questions andscale questions Open-end questions allow respondents to answer in their own words Open-endquestions often reveal more than closed-end questions because respondents are not limited in theiranswers Open-end questions are especially useful in exploratory research when the researcher istrying to find out what people think but not measuring how many people think in a certain wayClosed-end questions on the other hand provide answers that are easier to interpret and tabulateResearchers should also use care in the wording and ordering of questions They should usesimple direct unbiased wording Questions should be arranged in a logical order The firstquestion should create interest if possible and difficult or personal questions should be asked lastso that respondents do not become defensiveAlthough questionnaires are the most common research instrument mechanical instruments alsoare used We discussed two mechanical instruments people meters and supermarket scannersearlier in the chapter Another group of mechanical devices measures subjects physical responses

Step 3 Implementing the Research Plan

The researcher next puts the marketing research plan into action This involves collectingprocessing and analyzing the information Data collection can be carried out by the companysmarketing research staff or by outside firms The company keeps more control over the collectionprocess and data quality by using its own staff However outside firms that specialize in datacollection often can do the job more quickly and at a lower costThe data collection phase of the marketing research process is generally the most expensive andthe most subject to error The researcher should watch fieldwork closely to make sure that the planis implemented correctly and to guard against problems with contacting respondents withrespondents who refuse to cooperate or who give biased or dishonest answers and withinterviewers who make mistakes or take shortcuts

Step 4 Interpreting and Reporting the Findings

The final step in the marketing research process is interpreting and reporting the findings Theresearchers should keep from overwhelming managers with numbers and fancy statisticaltechniques Researchers should present important findings that are useful in the major decisionsfaced by management Interpretation should not be left only to researchers Marketing managerswill also have important insights into the problems Interpretation is an important phase of themarketing process The best research is meaningless if the manager blindly accepts wronginterpretations from the researcherThe researcher must now interpret the findings draw conclusions and report them tomanagement The researcher should not try to overwhelm managers with numbers and fancystatistical techniques Rather the researcher should present important findings that are useful inthe major decisions faced by managementHowever interpretation should not be left only to the researchers They are often experts inresearch design and statistics but the marketing manager knows more about the problem and the

decisions that must be made

In many cases findings can be interpreted in different ways anddiscussions between researchers and managers will help point to the best interpretations Themanager will also want to check that the research project was carried out properly and that all thenecessary analysis was completed Or after seeing the findings the manager may have additionalquestions that can be answered through further sifting of the data Finally the manager is the onewho ultimately must decide what action the research suggests The researchers may even make thedata directly available to marketing managers so that they can perform new analyses and test newrelationships on their ownInterpretation is an important phase of the marketing process The best research is meaningless ifthe manager blindly accepts faulty interpretations from the researcher Similarly managers may bebiasedmdashthey might tend to accept research results that show what they expected and to rejectthose that they did not expect or hope for Thus managers and researchers must work togetherclosely when interpreting research results and both must share responsibility for the researchprocess and resulting decisions

RESEARCH DESIGN

Exploratory research and itrsquos methods

Exploratory research is conducted to clarify ambiguous problems Management may have discovered general problems but research is needed to gain better understanding of the dimensions of the problems Exploratory studies provide information to use in analyzing a situation but uncovering conclusive evidence to determine a particular course of action is not the purpose of exploratory research Usually exploratory research is conducted with the expectation that subsequent research will be required to provide conclusive evidence It is a serious mistake to rush into detailed surveys before less expensive and more readily available sources of information have been exhausted

In an organisation considering a program to help employees with childcare needs for example exploratory research with a small number of employees who have children might determine that many of them have spouses who also work and that these employees have positive reactions to the possibility of an on-site child-care program In such a case exploratory research helps to crystallize a problem and identify information needs for future research

Exploratory research methods

The quickest and the cheapest way to formulate a hypothesis in exploratory research is by using any of the four methods

Literature search

Experience survey

Focus group

Analysis of selected cases

Literature Search

This refers to ldquoreferring to a literature to develop a new hypothesisrdquo The literature referred are ndash trade journals professional journals market research finding publications statistical publications etc Example Suppose a problem is ldquoWhy are sales downrdquo This can quickly be analyzed with the help of published data which should indicate ldquowhether the problem is an ldquoindustry problemrdquo or a ldquofirm problemrdquo Three possibilities exist to formulate the hypothesis

The companyrsquos market share has declined but industryrsquos figures are normal

The industry is declining and hence the companyrsquos market share is also declining

The industryrsquos share is going up but the companyrsquos share is declining

If we accept the situation that our companyrsquos sales are down despite the market showing an upward trend then we need to analyse the marketing mix variables

Example 1 A TV manufacturing company feels that its market share is declining whereas the overall television industry is doing very well

Example 2 Due to a trade embargo imposed by a country textiles exports are down and hence sales of a company making garment for exports is on the decline

The above information may be used to pinpoint the reason for declining sales

Experience Survey

In experience surveys it is desirable to talk to persons who are well informed in the area being investigated These people may be company executives or persons outside the organisation Here no questionnaire is required The approach adopted in an experience survey should be highly unstructured so that the respondent can give divergent views Since the idea of using experience survey is to undertake problem formulation and not conclusion probability sample need not be used Those who cannot speak freely should be excluded from the sample

Examples

1) A group of housewives may be approached for their choice for a ldquoready to cook productrdquo

2) A publisher might want to find out the reason for poor circulation of newspaper introduced recently He might meet (a) Newspaper sellers (b) Public reading room (c) General public (d) Business community etc

These are experienced persons whose knowledge researcher can use

Focus Group

Another widely used technique in exploratory research is the focus group In a focus group a small number of individuals are brought together to study and talk about some topic of interest The discussion is co-ordinated by a moderator The group usually is of 8-12 persons While selecting these persons care has to be taken to see that they should have a common background and have similar experiences in buying This is required because there should not be a conflict among the group members on the common issues that are being discussed During the discussion future buying attitudes present buying opinion etc are gathered

Most of the companies conducting the focus groups first screen the candidates to determine who will compose the particular group Firms also take care to avoid groups in which some of the participants have their friends and relatives because this leads to a biased discussion Normally a number of such groups are constituted and the final conclusion of various groups are taken for formulating the hypothesis Therefore a key factor in focus group is to have similar groups Normally there are 4-5 groups Some of them may even have 6-8 groups The guiding criteria is to see whether the latter groups are generating additional ideas or repeating the same with respect to the subject under study When this shows a diminishing return from the group the discussions stopped The typical focus group lasts for 1-30 hours to 2 hours The moderator under the focus group has a key role His job is to guide the group to proceed in the right direction

Analysis of selected cases

Analysing a selected case sometimes gives an insight into the problem which is being researched Case histories of companies which have undergone a similar situation may be available These case studies are well suited to carry out exploratory research However the result of investigation of case histories arc always considered suggestive rather than conclusive In case of preference to ldquoready to eat foodrdquo many case histories may be available in the form of previous studies made by competitors We must carefully examine the already published case studies with regard to other variables such as price advertisement changes in the taste etc

II DESCRIPTIVE RESEARCH AND ITrsquoS METHODS

Descriptive research is used to obtain information concerning the current status of the phenomena to describe ldquowhat existsrdquo with respect to variables or conditions in a situation The methods involved range from the survey which describes the status quo the correlation study which investigates the relationship between variables to developmental studies which seek to determine changes over time

Descriptive Research Methods

1 Case Studies

Detailed analysis of a single (or limited number) of people or events Case studies are usually interesting because of the unusualness of the case The major problem with case studies is the problem of objectivity The person who is presenting the case usually has some theoretical orientation It is acceptable for a theoretical orientation to affect onersquos interpretation of events In a case study the theoretical orientation can also lead to the selection of the facts to include in the case It is not surprising that case studies often seem to provide very compelling evidence for a theory Case studies can therefore assist psychology by illustrating how a theory could be applied to a person or events and by assisting with the development of hypotheses for more systematic testing

2 Observational Research

Accounts of the natural behavior of individuals or groups in some setting Unless the observation is unobtrusive there may be some subject reactivity to being observed This often decreases with time a process called habituation Observers cannot usually observe all behaviors all of the time They may use a behavioral checklist and may also use time sampling or event sampling procedures It is important to assess observer bias by the use of interobserver reliability Observational research may also pose ethical problems These can arise when the behaviors being observed are not public behaviors and when the observer joins a group in order to observe the membersrsquo behavior ndash participant observation

3 Survey Research

Structured questions to assess peoples beliefs attitudes and self-reports of behavior If the researcher wishes to generalize the responses to a population it is important to have a representative sample Surveys that rely on self-selection (respond if you are interested) produce non-generalizable results Surveys also provide information for co relational research One can correlate responses to some questions (often demographic questions) with responses to other questions (often attitudes or reports of behavior) Survey question must be clear and unambiguous Even if the questions are unambiguous and non-leading people may display a social desirability bias and give positive or socially acceptable and desirable answers Survey methods include (1) the interview or face-to-face method which is generally viewed as the best method for obtaining a high rate of responses but is also very costly (2) phone surveys which are less expensive but have a higher non-response rate (which has probably increased with caller ID) and (3) written or mail surveys which are least expensive but have a very high non-response rate Follow-up messages can help increase the response rate

4 Archival Research

Analysis of pre-existing data or records Archival research often involves content analysis a qualitative analysis of material For example one would use content analysis to determine whether there had been an increase in the frequency with which women and minorities were mentioned in US history books between 1920 and 2000 Some archival research is quasi-experimental

III EXPERIMENTAL RESEARCH AND ITrsquoS STAGES

Science revolves around experiments and learning the best way of conducting an experiment is crucial to obtaining useful and valid results When scientists speak of experiments in the strictest sense of the word they mean a true experiment where the scientist controls all of the factors and conditions Real world observations and case studies should be referred to as observational research rather than experiments For example observing animals in the wild is not a true experiment because it does not isolate and manipulate an independent variable

THE BASIS OF CONDUCTING AN EXPERIMENT

With an experiment the researcher is trying to learn something new about the world an explanation of lsquowhyrsquo something happens The experiment must maintain internal and external validity or the results will be useless When designing an experiment a researcher must follow all of the steps of the scientific method from making sure that the hypothesis is valid and testable to using controls and statistical tests

Whilst all scientists use reasoning operationalization and the steps of the scientific process it is not always a conscious process Experience and practice mean that many scientists follow an instinctive process of conducting an experiment the lsquostreamlinedrsquo scientific process Following the basic steps will usually generate valid results but where experiments are complex and expensive it is always advisable to follow the rigorous scientific protocols

Conducting a experiment has a number of stages where the parameters and structure of the experiment are made clear Whilst it is rarely practical to follow each step strictly any aberrations must be justified whether they arise because of budget impracticality or ethics

STAGE ONE

After deciding upon a hypothesis and making predictions the first stage of conducting an experiment is to specify the sample groups These should be large enough to give a statistically viable study but small enough to be practical Ideally groups should be selected at random from a wide selection of the sample population This allows results to be generalized to the population as a whole In the physical sciences this is fairly easy but the biological and behavioral sciences are often limited by other factors

For example medical trials often cannot find random groups Such research often relies upon volunteers so it is difficult to apply any realistic randomization This is not a problem as long as the process is justified and the results are not applied to the population as a whole If a psychological researcher used volunteers who were male students aged between 18 and 24 the findings can only be generalized to that specific demographic group within society

STAGE TWO

The sample groups should be divided into a control group and a test group to reduce the possibility of confounding variables This again should be random and the assigning of subjects to groups should be blind or double blind This will reduce the chances of experimental error or bias when conducting an experiment

Ethics are often a barrier to this process because deliberately withholding treatment is not permitted Again any deviations from this process must be explained in the conclusion There is nothing wrong with compromising upon randomness where necessary as long as other scientists are aware of how and why the researcher selected groups on that basis

STAGE THREE

This stage of conducting an experiment involves determining the time scale and frequency of sampling to fit the type of experiment For example researchers studying the effectiveness of a cure for colds would take frequent samples over a period of days Researchers testing a cure for Parkinsonrsquos disease would use less frequent tests over a period of months or years

STAGE FOUR

The penultimate stage of the experiment involves performing the experiment according to the methods stipulated during the design phase The independent variable is manipulated generating a usable data set for the dependent variable

STAGE FIVE

The raw data from the results should be gathered and analyzed by statistical means This allows the researcher to establish if there is any relationship between the variables and accept or reject the null hypothesis

These steps are essential to providing excellent results Whilst many researchers do not want to become involved in the exact processes of inductive reasoning deductive reasoning and operationalization they all follow the basic steps of conducting an experiment This ensures that their results are valid

CHARACTERISTICS OF MARKETING RESEARCH(1) Systematic and continuous process MR is a continuous process This is natural as new marketing problems are bound to come from time to time in the course of marketing of goods and services One type of research is not adequate to resolve all marketing problems Similarly new research projects will have to be undertaken to solve new marketing problems and challenges A marketing company faces new marketing problems from time to time For facing these problems marketing research activities need to be conducted on a regular basis A marketing company has to conduct MR regularly for its survival amp growth in the present dynamic marketing environment(2) Widecomprehensive in scope and application MR is wide in scope as it deals with all aspects of marketing of goods and services It is more than just collecting data on marketing Introduction of new products identification of potential markets selection of appropriate selling techniques study of market competition and consumer preferences introduction of suitable advertising strategy and sales promotion measures are some areas covered by MR It plays a role in all the three phases of the management process in marketing planning implementation and evaluation(3) Emphasizes on accurate data collection and critical analysis In MR required data should be collected objectively and accurately The data collected must be reliable It should be analyzed in a systematic manner This will provide comprehensive picture of the situation and possible solutions(4) Offers benefits to sponsoring company and consumers MR is useful to the sponsoring company It raises the turnover and profit of the company It also raises the competitive capacity and creates goodwill in the market It enables a company to introduce consumer-oriented marketing policies Consumers also get agreeable goods and more satisfaction due to MR activities(5) Commercial equivalent of military intelligence MR is the commercial intelligence activity It is similar to military intelligence where systematic study is made before taking any military action MR acts as the intelligence tool of marketing management(6) Tool for managerial decisions MR acts as a tool in the hands of management for identifying and analyzing marketing problems and finding out solutions to them It is an aid to decision-making It suggests possible solutions for the consideration and selection by managers MR is an aid to judgment and never a substitute for it(7) Applied type of research MR is applied knowledge It is also called decisional research as it provides specific alternative solutions to deal with a specific marketing problem It studies specific marketing problem and suggests alternative solutions and possible outcome of each alternative In addition it is both science and an art MR is also becoming highly professional activity(8) Reduces the gap between the producers and consumers MR is an essential supplement of modern competitive marketing It is useful for understanding the needs and expectations of consumers It reduces the gap between producers and consumers and adjusts the marketing activities to suit the needs of consumers(9) Not an exact science MR is both science and an art It collects information and studies marketing problem in a scientific manner The information collected is also applied to real lire problem However MR is not an exact science It only suggests possible solutions and not the exact solution to marketing manager for consideration and selection At present MR is treated as a professional activity We have professional agencies (MR agencies or advertising agencies) dealing with the marketing problems of their clients on commission basis(10) Use of different methods MR can be conducted by using different methods Data can be collected through survey or by other methods like observation method or experimentation method Even computers and internet are used for data collection The researcher has to decide the method

that is suitable for the conduct of research project This selection is important as the use of unsuitable methods affect the quality of research work(11) Dynamic character MR is dynamic in nature Its scope is fast expanding along with the new developments in the field of marketing This is natural as MR is essentially for dealing with new problems and challenges in the field of marketing In addition developments in other subjects such as economics statistics computer science sociology psychology cultural anthropology and behavioral sciences also bring corresponding changes in the field of MR New methods new techniques etc are used while conducting the research activities This suggests that MR is a dynamic and progressive subject with new developments taking place regularly(12) Closely connected with marketing information system Both the concepts are interrelated In fact MR is one component of MIS Both are useful for solving marketing problems and for accurate and quick decision-making in the field of marketing(13) Phenomenal growth MR has made a phenomenal growth since its inception It has become an important tool in the hands of management (to solve marketing problems) along with the advent of consumer-oriented philosophy in modern business The increasing research budgets of companies are the indicators of its tremendous growth in recent years

AIMS AND OBJECTIVES OF MARKETING RESEARCHThe aims of the marketing research and analysis may be stated as follows(1) To study the needs wants and expectations of consumers(2) To find out reactions of consumers to the products of the company(3) To evaluate companys sales promotion measures for suitable adjustment and improvement(4) To study current marketing problems and opportunities for suitable follow-up actions(5) To suggest the introduction of new products modifications of existing products and to discover new uses of existing products(6) To design and test appropriate packages of companys products and make packaging as attractive as possible(7) To study existing pricing channels of distribution and market competition for suitable changes if necessary(8) To find out methods for making the products of the company popular and raising its goodwill and market reputation(9) To assess competitive strength and policies(10) To estimate potential buying-power in various areas(11) To know the companys expected share of the market(12) To determine the dimensions of the marketing problems facilitate evaluation of the alternative solutions of different problems and help in the selection of a right course of action(13) To define the probable market for a specialized product and to report on general market conditions and tendencies buying habits etc

MARKET RESEARCH VS MARKETING RESEARCHThe two terms ldquomarket research and marketing research are used interchangeably though there is difference in the meaning and scope of the two terms Market research is used as a popular synonym for marketing research Market is a part of marketing and market research is only a part of marketing research It covers only a few aspects of marketing According to Philip Kotler the term market research is accurate for describing research into the market its size geographical

distribution income and so on However it fails to cover the idea of research into the effects of marketing efforts on the market for which the term marketing research is more accurate MR is increasingly coming into favor as the term that describes both ideas Marketing research need not be treated as pure academic research It is a type of applied research with scientific orientation

Distinction between market research and marketing research

DimensionMarket ResearchMarketing ResearchMeaningMarket research directly relates to market situation ie size location market competition and features of customers It provides details about the market for decision-making and policy framingMarketing research is a systematic and comprehensive searchstudy of different aspects of marketing - including the current marketing problems and challenges for decision-making amp policy framingNatureMarket research is a branch of marketing research

Marketing research is one branch of Marketing Information SystemScopeThe scope of market research is limitedrestricted to the study of market or market situation

The scope of marketing research is comprehensive amp wide as it covers all aspects of marketingType of termMarket research is a narrow term as it relates to one aspect of marketing

Marketing research is a widebroad term as it covers all aspects of marketingObjectiveMarket research is undertaken in order to deal with the problems and challenges relating to different aspects of market such as competition market demand and consumer needs

Marketing research is undertaken in order to study varied types of marketing problems such as product line marketing mix advertising packaging branding and so on

GROWING IMPORTANCE OF MARKETING RESEARCH

Marketing research has received attention and importance along with the growth of highly competitive consumer-oriented marketing philosophy Research activities in different aspects of marketing are necessary and useful in such competitive and flexible marketing environment Large companies marketing consumer items noted the growing need of MR activities in the marketing decision-making process They naturally took initiative in conducting research activities within the organization itself This was followed by the formation of specialized marketing research agencies and advertising agencies for this purpose This is how professional orientation was given to MR

Many marketing research departments and agencies were established after World War II

MR activity (as we understand today) is comparatively new in the field of marketing This activity probably began around 1950s (Modern era of marketing research) and attracted the attention of companies interested in marketing their products in the national and global markets However the concept of MR got firm roots in the marketing activity after 1910 First time the marketing research techniques were used by newspapers to predict the election results However during the second decade of 20th century marketing research emerged as a valuable management tool to solve marketing problems In the developed countries marketing research activity is conducted on scientific lines Even in India large manufacturing companies treat marketing research as an essential supplement of planning and decision-making in the marketing field It is treated as an indispensable tool for profitable and consumer-oriented marketing The popularity of MR increased after 1960 due to the introduction of computers in data collection and analysis In the early period marketing research activities were confined to market studies only but in 1950s research relating to marketing activities was broadened to include all managerial aspects-price produce place and promotion In late 1950s motivational and psychological techniques were introduced to generate more information on consumers

Several factors have contributed to the growing importance of marketing research For example due to large-scale production producers could not have direct contact with the consumers This created many problems before producers For solving all such problems developed due to the gap between producers and consumer and marketing research activities prove to be useful

Secondly the shifting from sellersrsquo market to buyers market made it necessary to have better understanding about consumer net-expectations For this marketing research proved to be useful

Thirdly the introduction of computers has contributed to the growth of marketing research activity

Fourthly rapid changes in the business environment shift to consumer-oriented philosophy in business are also responsible for growing importance of marketing research

Finally the scope of marketing has widened due to population growth and development of rural markets MR proved to be useful for dealing with the problems created by national and global markets In brief growing importance of marketing research in the present marketing system is the net result of various factors and forces available in the present marketing system At present MR activities are undertaken by marketing companies on their own In addition marketing research consultants and agencies provide expert advice to companies on general and specific marketing problems of their clients

Relevance of MR under GlobalizationThe business world is fast moving towards globalization in which all countries participate Every country has to face competition in the domestic as well as in export marketing Survival in the global business is possible through quality improvement cost reduction and by attracting consumers through various sales promotion techniques Here MR offers helping hand to companies It offers

suggestions for survival under global competitive environment In brief the importancerelevance of MR is fast growing along with the globalization of business It is a must for survival and growth under globalization Current marketing scenario is different as compared to traditional one There is a new trend towards liberalization and globalization Markets (domestic as well as foreign) are becoming highly competition New companies and new products re entering in the markets Survival is difficult under the present marketing environment Here MR offers various services It is now a professional activity with new developments in regard to scopecoverage and techniques In brief MR has great relevance in the current marketing scenario in India as well as in all countries- developed and developing of the world MR has enormous capacity to help and guide marketing companies in regard to their marketing problems and challenges

FUNCTIONS OF MARKETING RESEARCHMR performs five basic functions These are Description evaluation explanation prediction and finally aid in decision-making These functions are related to the research project undertaken Usually every research study performs all the five functions explained below(1) Description MR provides data and gives informationdescription of customers who buy the product This includes information about their agesex education income and the amount of money that they are willing to spend on the product Description of the customers is useful in order to draw certain conclusions about the customers and their buying behavior Even marketing strategies can be decided as per the information available(2) Evaluation MR is useful for understanding the viewsreactions of the buyers This includes views of consumers on packaging advertisingsales promotion measures used A manufacturer gets these details as well as the information about his product in comparison with the products of his competitors This facilitates evaluation of the marketing policies For example how far the packaging of the product is attractive to consumers or superior as compared to packaging by competitors and so on(3) Explanation MR gives explanation to certain questions of a manufacturer It may be related to decline in sales retailers negative reaction or resistance of consumers in a particular marketing area MR enables a manufacturer to understand why sales are reducing (causes) or why the response of the retailers is negative or why consumers in a particular region are not willing to purchase a specific product Such explanation is important as it enables a manufacturer to adjust his marketing policies in order to rectify the prevailing unfavorable situation(4) Prediction MR conducts prediction function Such predictions may be related to consumers market environmentmarket competition possible socio-economic changes and so on This prediction function enables a manufacturer to understand how much people will spend on the specific product in the next year or the fashions that consumers may prefer in the next year In addition prediction about the possible turnover in the years to come is also possible through suitable marketing research studies In brief marketing research is useful for understanding the marketing environment likely to develop in future This facilitates proper adjustment in the marketing policies for the future period In this sense the prediction function is important even when all predictions made through research studies may not prove to be fully correct However the trend indicated can be used for appropriate policy decisions(5) Aid in Decision-making One more function of MR is to facilitate the process of decision-making in the marketing field MR guides the manufacturer as regards the manner in which he can make

effective advertising appeal or create incentive among his salesmendistributors It also gives him guidance as regards price fixation and sales promotion techniques that will be useful for the future period This function of marketing research is closely related to other functions that it performs These functions facilitate reasonably correct decision-making by marketing managers

They also suggest the practical utility of MR activities

MR functions provide feedback (information and guidance) to marketing managers and improve the quality of their decision-making This practice is certainly safer as compared to decision-making on the basis of past experience or intuition When reality is complex and many facts are not detectable intuition is not adequate for decision-making Similarly experience is useful but decisions on experience alone may not be accurate

Large companies and professional executives prefer to resort to marketing research than depending on experience This is because information available is based on real data and is more reliable dependable This facilitates correct decision-making Thus marketing executives should prefer decisions on the basis of information supplied through marketing research Such decisions are likely to be more accurate as they are based on actual market situation

In brief the basic function of MR is to support marketing decision-making process Marketing research does not provide ready-made decisions or exact solutions on all marketing problems It only provides the clues or possible solutions that should be taken into consideration in the decision-making process It provides support to skills and abilities of marketing managers

The different functions of marketing research are supplementary in character These functions enable a manufacturer to keep close touch with the marketing situation and enable him to make suitable changes in his marketing policies and programmers They also suggest the role marketing research activity in modern competitive and consumer oriented marketing Marketing research functions certainly improve the quality of decision-making by marketing managers

ADVANTAGESIMPORTANCE OF MARKETING RESEARCH1 Indicates current market trends Marketing research keeps business unit in touch with the current market trends and offers guidance for facing market situation with confidence2 Pinpoints deficiencies in marketing policies MR pinpoints the deficiencies as regards products pricing promotion etc It gives guidance regarding different aspects of marketing They include product development branding packaging and advertising3 Explains customer resistance MR is useful for finding out customer resistance to companys products The researcher also suggests remedial measures to deal with the situation This makes the products and marketing policies agreeable to consumers4 Suggests sales promotion techniques MR enables a manufacturer to introduce appropriate sales promotion techniques select most convenient channel of distribution suitable pricing policy for the products and provision of discounts and concessions to dealers Marketing research facilitates sales promotion5 Offers guidance to marketing executives MR offers information and guidance to marketing

executives while framing marketing policies Continuous research enables a company to face adverse marketing situation boldly It acts as an insurance against possible changes in market environment6 Facilitates selection and training of sales force Marketing research is useful for the selection and training of staff in the sales organization It also suggests the incentives that should be offered for motivation of employees concerned with marketing7 Promotes business activities Marketing research enables a business unit to growexpand its activities It creates goodwill in the market and also enables a business unit to earn high profits through consumer-oriented marketing policies and programmers8 Facilitates appraisal of marketing policies Research activities enable business executives to have an appraisal of the present marketing policies in the light of findings of research work Suitable adjustments in the policies are also possible as per the suggestions made by the researchers9 Suggests new marketing opportunities MR suggests new marketing opportunities and the manner in which they can be exploited fully It identifies emerging market opportunities10 Facilitates inventory study Marketing research is useful for the evaluation of companyrsquos inventory policies and also for the introduction of more efficient ways of managing inventories including finished goods and raw materials11 Provides marketing information MR provides information on various aspects of marketing It suggests relative strengths and weaknesses of the company On the basis of such information marketing executives find it easy to frame policies for the future period MR provides information guidance and alternative solutions to current marketing problems12 Suggests appropriate distribution channels MR can be used to study the effectiveness of existing channels of distribution and the need of making suitable changes in the distribution system13 Provides information on product acceptance Marketing research helps in knowing the probability of acceptance of the product in its present form It is also useful for the introduction of modifications in the existing product line of a firm14 Creates progressive outlook MR generates a progressive and dynamic outlook throughout the business organization It promotes systematic thinking and a sense of professionalization within the company It also creates enthusiasm among marketing executives This brings success and stability to the whole business unit15 Has wider social significance MR is of paramount importance from the social angle It is the means by which the ultimate consumer literally becomes king of the market place with his desires prejudices and every whim transmitted to the producer and distributor In brief MR has wider social significance It is useful to all parties involved in the process of marketing

A marketing information system (MIS) is intended to bring together disparate items of data into a coherent body of information An MIS is as will shortly be seen more than raw data or information suitable for the purposes of decision making An MIS also provides methods for interpreting the information the MIS provides Moreover as Kotlers1 definition says an MIS is more than a system of data collection or a set of information technologies

A marketing information system is a continuing and interacting structure of people equipment and procedures to gather sort analyse evaluate and distribute pertinent timely and accurate information for use by marketing decision makers to improve their marketing planning implementation and control

Figure 91 illustrates the major components of an MIS the environmental factors monitored by the system and the types of marketing decision which the MIS seeks to underpin

Figure 91 The marketing information systems and its subsystems

The explanation of this model of an MIS begins with a description of each of its four main constituent parts the internal reporting systems marketing research system marketing intelligence system and marketing models It is suggested that whilst the MIS varies in its degree of sophistication - with many in the industrialised countries being computerised and few in the developing countries being so - a fully fledged MIS should have these components the methods (and technologies) of collection storing retrieving and processing data notwithstanding

Internal reporting systems All enterprises which have been in operation for any period of time nave a wealth of information However this information often remains under-utilised because it is compartmentalised either in the form of an individual entrepreneur or in the functional departments of larger businesses That is information is usually categorised according to its nature so that there are for example financial production manpower marketing stockholding and logistical data Often the entrepreneur or various personnel working in the functional departments holding these pieces of data do not see how it could help decision makers in other functional areas Similarly decision makers can fail to appreciate how information from other functional areas might help them and therefore do not request it

The internal records that are of immediate value to marketing decisions are orders received stockholdings and sales invoices These are but a few of the internal records that can be used by marketing managers but even this small set of records is capable of generating a great deal of information Below is a list of some of the information that can be derived from sales invoices

middot Product type size and pack type by territorymiddot Product type size and pack type by type of accountmiddot Product type size and pack type by industrymiddot Product type size and pack type by customermiddot Average value andor volume of sale by territorymiddot Average value andor volume of sale by type of accountmiddot Average value andor volume of sale by industrymiddot Average value andor volume of sale by sales person

By comparing orders received with invoices an enterprise can establish the extent to which it is providing an acceptable level of customer service In the same way comparing stockholding records with orders received helps an enterprise ascertain whether its stocks are in line with current demand patterns

Marketing research systems The general topic of marketing research has been the prime subject of the textbook and only a little more needs to be added here Marketing research is a proactive search for information That is the enterprise which commissions these studies does so to solve a perceived marketing problem In many cases data is collected in a purposeful way to address a well-defined problem (or a problem which can be defined and solved within the course of the study) The other form of marketing research centres not around a specific marketing problem but is an attempt to continuously monitor the marketing environment These monitoring or tracking exercises are continuous marketing research studies often involving panels of farmers consumers or distributors from which the same data is collected at regular intervals Whilst the ad hoc study and continuous marketing research differs in the orientation yet they are both proactive

Marketing intelligence systems Whereas marketing research is focused market intelligence is not A marketing intelligence system is a set of procedures and data sources used by marketing managers to sift information from the environment that they can use in their decision making This scanning of the economic and business environment can be undertaken in a variety of ways including2

Unfocused scanning

The manager by virtue of what heshe reads hears and watches exposes himherself to information that may prove useful Whilst the behaviour is unfocused and the manager has no specific purpose in mind it is not unintentional

Semi-focused scanning

Again the manager is not in search of particular pieces of information that heshe is actively searching but does narrow the range of media that is scanned For instance the manager may focus more on economic and business publications broadcasts etc and pay less attention to political scientific or technological media

Informal search

This describes the situation where a fairly limited and unstructured attempt is made to obtain information for a specific purpose For example the marketing manager of a firm considering entering the business of importing frozen fish from a neighbouring country may make informal inquiries as to prices and demand levels of frozen and fresh fish There would be little structure to this search with the manager making inquiries with traders heshe happens to encounter as well as with other ad hoc contacts in ministries international aid agencies with trade associations importersexporters etc

Formal search

This is a purposeful search after information in some systematic way The information will be required to address a specific issue Whilst this sort of activity may seem to share the characteristics of marketing research it is carried out by the manager himherself rather than a professional researcher Moreover the scope of the search is likely to be narrow in scope and far less intensive than marketing research

Marketing intelligence is the province of entrepreneurs and senior managers within an agribusiness It involves them in scanning newspaper trade magazines business journals and reports economic forecasts and other media In addition it involves management in talking to producers suppliers and customers as well as to competitors Nonetheless it is a largely informal process of observing and conversing

Some enterprises will approach marketing intelligence gathering in a more deliberate fashion and will train its sales force after-sales personnel and districtarea managers to take cognisance of competitors actions customer complaints and requests and distributor problems Enterprises with vision will also encourage intermediaries such as collectors retailers traders and other middlemen to be proactive in conveying market intelligence back to them

Marketing models Within the MIS there has to be the means of interpreting information in order to give direction to decision These models may be computerised or may not Typical tools are

middot Time series sales modesmiddot Brand switching modelsmiddot Linear programmingmiddot Elasticity models (price incomes demand supply etc)middot Regression and correlation modelsmiddot Analysis of Variance (ANOVA) modelsmiddot Sensitivity analysismiddot Discounted cash flowmiddot Spreadsheet what if models

These and similar mathematical statistical econometric and financial models are the analytical subsystem of the MIS A relatively modest investment in a desktop computer is enough to allow an enterprise to automate the analysis of its data Some of the models used are stochastic ie those containing a probabilistic element whereas others are deterministic models where chance plays no part Brand switching models are stochastic since these express brand choices in probabilities whereas linear programming is deterministic in that the relationships between variables are expressed in exact mathematical terms

THE MARKETING RESEARCH PROCESS

a Marketing Research an Introduction

Every marketer needs marketing research and most large companies have their own marketingresearch departments Marketing research involves a four-step process The first step consists ofthe manager and researcher carefully defining the problem and setting the research objectives Theobjective may be exploratory descriptive or causal The second step consists of developing the

research plan for collecting data from primary and secondary sources Primary data collection callsfor choosing a research approach (observation survey experiment) choosing a contact method(mail telephone personal) designing a sampling plan (whom to survey how many to survey andhow to choose them) and developing research instruments (questionnaire mechanical) The thirdstep consists of implementing the marketing research plan by collecting processing and analyzingthe information The fourth step consists of interpreting and reporting the findings Furtherinformation analysis helps marketing managers to apply the information and provides advancedstatistical procedures and models to develop more rigorous findings from the informationSome marketers face special marketing research considerations such as conducting research insmall-business non-profit or international situations Marketing research can be conductedeffectively by small organizations with small budgets International marketing researchers follow the same steps as domestic researchers but often face more challenging problems All organizations need to understand the major public policy and ethics issues surrounding marketing research

b Uses amp Application of Research in Marketing

Decision-making is crucial process in all types of the organization This decision-making requiresthen information that is collected and acquired through the marketing research process thisinformation can be regarding customers companies or competitor or the other environmentalfactors Major uses of the marketing research in the organizations are as following1048713 Measurement of market potential1048713 Analysis of market share1048713 Determination of market characteristics1048713 Sales analysis1048713 Product testing1048713 Forecasting1048713 Studies of business trends1048713 Studies of competitors products

c THE MARKETING RESEARCH PROCESS

Before researcher can provide managers with information they mustknow what kind of problem the manager wishes to solve Marketingresearch process has following steps1 Defining the problem and research objectives2 Developing the research plan3 Implementing the research plan and4 Interpreting and reporting the findings

Now we will discuss these steps in detail

Step 1 Defining the Problem and Research Objectives

The marketing manager and the researcher must work closely together to define the problemcarefully and agree on the research objectives Marketing managers must know enough aboutmarketing research to help in the planning and to interpret research results Defining the problemand research objectives is often the hardest step in the process After the problem has been definedcarefully the manager and researcher must set the research objectives The three general types ofobjectives are1) Exploratory research where the objective is to gather preliminary information thatwill help to better define problems and suggest hypotheses for their solution2) Descriptive research is where the intent is to describe things such as the marketpotential for a product or the demographics and attitudes of customers who buy the product3) Casual research is research to test hypotheses about cause-and-effect relationshipsThe statement of the problem and research objectives will guide the entire research process It isalways best to put the problem and research objectives statements in writing so agreement can bereached and everyone knows the direction of the research effort

Step 2 Developing the Research Plan

In developing the research plan the attempt is to determine the information needed (outlinesources of secondary data) develop a plan for gathering it efficiently and presenting the plan tomarketing management The plan spells out specific research approaches contact methodssampling plans and instruments that researchers will use to gather new data The firm shouldknow what data already exists before the process of collecting new data begins The steps thatshould be followed are Developing the research plan involves all of the following1 Determining Specific Information Needs2 Gathering Secondary Information3 Planning Primary Data Collection

1) Determine specific information needs

In this step research objectives are translatedinto specific information needs For example determine the demographic economic and lifestylecharacteristics of a target audience

2) Gathering secondary information

a) Secondary data is information that already exists somewhere having beencollected for another purpose Sources of secondary data include both internal and externalsources Companies can buy secondary data reports from outside suppliers (ie commercial datasources)Information can be obtained by using commercial online databases Examples includeCompuServe Dialog and Lexis-Nexus Many of these sources are free Advantages of secondarydata include1 It can usually be obtained more quickly and at a lower cost than primary data2 Sometimes data can be provided that an individual company could not collect on its own

Some problems with collecting secondary data include1 The needed information might not exist2 Even if the data is found it might not be useable3 The researcher must evaluate secondary information to make certain it is relevantaccurate current and impartial Secondary data is a good starting point however the company willoften have to collect primary datab) Primary data is information collected for the specific purpose at hand

Planning Primary Data Collection

A plan for primary data collection calls for a number ofdecisions on research approaches contact methods sampling plans and research instruments

Research Approaches

a) Research approaches can be listed as

1 Observational research

where information is gained by observing relevantpeople actions and situations However some things such as feelingsattitudes motives and private behavior cannot be observed Mechanicalobservation can be obtained through single source data systems This iswhere electronic monitoring systems link consumersrsquo exposure to televisionadvertising and promotion (measured using television meters) with what theybuy in stores (measured using store checkout scanners) Observationalresearch can be used to obtain information that people are unwilling orunable to provide

2 Survey research

is the gathering of primary data by asking people questionsabout their knowledge attitudes preferences and buying behavior Survey research is best suitedfor gathering descriptive information Survey research is the most widely used form of primarydata collection The major advantage of this approach is flexibility while the disadvantages includethe respondent being unwilling to respond giving inaccurate answers or unwilling to spend thetime to answer

3 Experimental research

involves the gathering of primary data by selectingmatched groups of subjects giving them different treatments controlling related factors andchecking for differences in-group responses This form of research tries to explain cause-andeffectrelationships Observation and surveys may be used to collect information in experimentalresearch This form is best used for causal information

In last Lesson we discussed the marketing research process first two steps were discussed in thatLesson today we will continue the same topic and will be discussing the remaining steps of themarketing research process Second topic of todayrsquos Lesson is an introduction to the consumer

behaviorSo our todayrsquos topics are

A THE MARKETING RESEARCH PROCESS (Continued)

B CONSUMER MARKET

Contact Methods

Contact methods are used to obtain the information Contact methods can be listed as1 Mail questionnaires--used to collect large amounts of information at a low cost2 Telephone interviewing--good method for collecting information quickly3 Personal interviewing (which can be either individual or group interviewing)A form of personal interviewing is ldquofocus group interviewingrdquoFocus-group interviewing consists of inviting six to ten people to gather for a few hours with atrained interviewer to talk about a product service or organization The interviewer ldquofocusesrdquothe group discussion on important issues4 Online (Internet) marketing research can consist of Internet surveys or online focus groupsMany experts predict that online research will soon be the primary tool of marketing researchers5 Computer interviewing is a new method being used in the technology age Consumers readquestions from a computer screen and respondSampling plans are used to outline how samples will be constructed and used1 A sample is a segment of the population selected for marketing research to represent thepopulation as a whole2 Marketing researchers usually draw conclusions about large groups of consumers bystudying a small sample of the total consumer population3 Designing a sample calls for three decisionsa Who is to be surveyed (what sampling unit)b How many people should be surveyed (what sample size)c How should the sample be chosen (what sampling procedure)4 Kinds of samples includea Probability samples--each population member has a known chance of beingincluded in the sample and researchers can calculate confidence limits for samplingerrorb Nonprobability samples--sampling error cannot be measuredResearch InstrumentsIn collecting primary data marketing researchers have a choice of two main researchinstrumentsmdashthe questionnaire and mechanical devices The questionnaire is by far the mostcommon instrument whether administered in person by phone or online Questionnaires are veryflexiblemdashthere are many ways to ask questions However they must be developed carefully andtested before they can be used on a large scale A carelessly prepared questionnaire usually containsseveral errors In preparing a questionnaire the marketing researcher must first decide what questions to askQuestionnaires frequently leave out questions that should be answered and include questions that

cannot be answered will not be answered or need not be answered Each question should bechecked to see that it contributes to the research objectivesThe form of each question can influence the response Marketing researchers distinguish betweenclosed-end questions and open-end questions Closed-end questions include all the possibleanswers and subjects make choices among them Examples include multiple-choice questions andscale questions Open-end questions allow respondents to answer in their own words Open-endquestions often reveal more than closed-end questions because respondents are not limited in theiranswers Open-end questions are especially useful in exploratory research when the researcher istrying to find out what people think but not measuring how many people think in a certain wayClosed-end questions on the other hand provide answers that are easier to interpret and tabulateResearchers should also use care in the wording and ordering of questions They should usesimple direct unbiased wording Questions should be arranged in a logical order The firstquestion should create interest if possible and difficult or personal questions should be asked lastso that respondents do not become defensiveAlthough questionnaires are the most common research instrument mechanical instruments alsoare used We discussed two mechanical instruments people meters and supermarket scannersearlier in the chapter Another group of mechanical devices measures subjects physical responses

Step 3 Implementing the Research Plan

The researcher next puts the marketing research plan into action This involves collectingprocessing and analyzing the information Data collection can be carried out by the companysmarketing research staff or by outside firms The company keeps more control over the collectionprocess and data quality by using its own staff However outside firms that specialize in datacollection often can do the job more quickly and at a lower costThe data collection phase of the marketing research process is generally the most expensive andthe most subject to error The researcher should watch fieldwork closely to make sure that the planis implemented correctly and to guard against problems with contacting respondents withrespondents who refuse to cooperate or who give biased or dishonest answers and withinterviewers who make mistakes or take shortcuts

Step 4 Interpreting and Reporting the Findings

The final step in the marketing research process is interpreting and reporting the findings Theresearchers should keep from overwhelming managers with numbers and fancy statisticaltechniques Researchers should present important findings that are useful in the major decisionsfaced by management Interpretation should not be left only to researchers Marketing managerswill also have important insights into the problems Interpretation is an important phase of themarketing process The best research is meaningless if the manager blindly accepts wronginterpretations from the researcherThe researcher must now interpret the findings draw conclusions and report them tomanagement The researcher should not try to overwhelm managers with numbers and fancystatistical techniques Rather the researcher should present important findings that are useful inthe major decisions faced by managementHowever interpretation should not be left only to the researchers They are often experts inresearch design and statistics but the marketing manager knows more about the problem and the

decisions that must be made

In many cases findings can be interpreted in different ways anddiscussions between researchers and managers will help point to the best interpretations Themanager will also want to check that the research project was carried out properly and that all thenecessary analysis was completed Or after seeing the findings the manager may have additionalquestions that can be answered through further sifting of the data Finally the manager is the onewho ultimately must decide what action the research suggests The researchers may even make thedata directly available to marketing managers so that they can perform new analyses and test newrelationships on their ownInterpretation is an important phase of the marketing process The best research is meaningless ifthe manager blindly accepts faulty interpretations from the researcher Similarly managers may bebiasedmdashthey might tend to accept research results that show what they expected and to rejectthose that they did not expect or hope for Thus managers and researchers must work togetherclosely when interpreting research results and both must share responsibility for the researchprocess and resulting decisions

RESEARCH DESIGN

Exploratory research and itrsquos methods

Exploratory research is conducted to clarify ambiguous problems Management may have discovered general problems but research is needed to gain better understanding of the dimensions of the problems Exploratory studies provide information to use in analyzing a situation but uncovering conclusive evidence to determine a particular course of action is not the purpose of exploratory research Usually exploratory research is conducted with the expectation that subsequent research will be required to provide conclusive evidence It is a serious mistake to rush into detailed surveys before less expensive and more readily available sources of information have been exhausted

In an organisation considering a program to help employees with childcare needs for example exploratory research with a small number of employees who have children might determine that many of them have spouses who also work and that these employees have positive reactions to the possibility of an on-site child-care program In such a case exploratory research helps to crystallize a problem and identify information needs for future research

Exploratory research methods

The quickest and the cheapest way to formulate a hypothesis in exploratory research is by using any of the four methods

Literature search

Experience survey

Focus group

Analysis of selected cases

Literature Search

This refers to ldquoreferring to a literature to develop a new hypothesisrdquo The literature referred are ndash trade journals professional journals market research finding publications statistical publications etc Example Suppose a problem is ldquoWhy are sales downrdquo This can quickly be analyzed with the help of published data which should indicate ldquowhether the problem is an ldquoindustry problemrdquo or a ldquofirm problemrdquo Three possibilities exist to formulate the hypothesis

The companyrsquos market share has declined but industryrsquos figures are normal

The industry is declining and hence the companyrsquos market share is also declining

The industryrsquos share is going up but the companyrsquos share is declining

If we accept the situation that our companyrsquos sales are down despite the market showing an upward trend then we need to analyse the marketing mix variables

Example 1 A TV manufacturing company feels that its market share is declining whereas the overall television industry is doing very well

Example 2 Due to a trade embargo imposed by a country textiles exports are down and hence sales of a company making garment for exports is on the decline

The above information may be used to pinpoint the reason for declining sales

Experience Survey

In experience surveys it is desirable to talk to persons who are well informed in the area being investigated These people may be company executives or persons outside the organisation Here no questionnaire is required The approach adopted in an experience survey should be highly unstructured so that the respondent can give divergent views Since the idea of using experience survey is to undertake problem formulation and not conclusion probability sample need not be used Those who cannot speak freely should be excluded from the sample

Examples

1) A group of housewives may be approached for their choice for a ldquoready to cook productrdquo

2) A publisher might want to find out the reason for poor circulation of newspaper introduced recently He might meet (a) Newspaper sellers (b) Public reading room (c) General public (d) Business community etc

These are experienced persons whose knowledge researcher can use

Focus Group

Another widely used technique in exploratory research is the focus group In a focus group a small number of individuals are brought together to study and talk about some topic of interest The discussion is co-ordinated by a moderator The group usually is of 8-12 persons While selecting these persons care has to be taken to see that they should have a common background and have similar experiences in buying This is required because there should not be a conflict among the group members on the common issues that are being discussed During the discussion future buying attitudes present buying opinion etc are gathered

Most of the companies conducting the focus groups first screen the candidates to determine who will compose the particular group Firms also take care to avoid groups in which some of the participants have their friends and relatives because this leads to a biased discussion Normally a number of such groups are constituted and the final conclusion of various groups are taken for formulating the hypothesis Therefore a key factor in focus group is to have similar groups Normally there are 4-5 groups Some of them may even have 6-8 groups The guiding criteria is to see whether the latter groups are generating additional ideas or repeating the same with respect to the subject under study When this shows a diminishing return from the group the discussions stopped The typical focus group lasts for 1-30 hours to 2 hours The moderator under the focus group has a key role His job is to guide the group to proceed in the right direction

Analysis of selected cases

Analysing a selected case sometimes gives an insight into the problem which is being researched Case histories of companies which have undergone a similar situation may be available These case studies are well suited to carry out exploratory research However the result of investigation of case histories arc always considered suggestive rather than conclusive In case of preference to ldquoready to eat foodrdquo many case histories may be available in the form of previous studies made by competitors We must carefully examine the already published case studies with regard to other variables such as price advertisement changes in the taste etc

II DESCRIPTIVE RESEARCH AND ITrsquoS METHODS

Descriptive research is used to obtain information concerning the current status of the phenomena to describe ldquowhat existsrdquo with respect to variables or conditions in a situation The methods involved range from the survey which describes the status quo the correlation study which investigates the relationship between variables to developmental studies which seek to determine changes over time

Descriptive Research Methods

1 Case Studies

Detailed analysis of a single (or limited number) of people or events Case studies are usually interesting because of the unusualness of the case The major problem with case studies is the problem of objectivity The person who is presenting the case usually has some theoretical orientation It is acceptable for a theoretical orientation to affect onersquos interpretation of events In a case study the theoretical orientation can also lead to the selection of the facts to include in the case It is not surprising that case studies often seem to provide very compelling evidence for a theory Case studies can therefore assist psychology by illustrating how a theory could be applied to a person or events and by assisting with the development of hypotheses for more systematic testing

2 Observational Research

Accounts of the natural behavior of individuals or groups in some setting Unless the observation is unobtrusive there may be some subject reactivity to being observed This often decreases with time a process called habituation Observers cannot usually observe all behaviors all of the time They may use a behavioral checklist and may also use time sampling or event sampling procedures It is important to assess observer bias by the use of interobserver reliability Observational research may also pose ethical problems These can arise when the behaviors being observed are not public behaviors and when the observer joins a group in order to observe the membersrsquo behavior ndash participant observation

3 Survey Research

Structured questions to assess peoples beliefs attitudes and self-reports of behavior If the researcher wishes to generalize the responses to a population it is important to have a representative sample Surveys that rely on self-selection (respond if you are interested) produce non-generalizable results Surveys also provide information for co relational research One can correlate responses to some questions (often demographic questions) with responses to other questions (often attitudes or reports of behavior) Survey question must be clear and unambiguous Even if the questions are unambiguous and non-leading people may display a social desirability bias and give positive or socially acceptable and desirable answers Survey methods include (1) the interview or face-to-face method which is generally viewed as the best method for obtaining a high rate of responses but is also very costly (2) phone surveys which are less expensive but have a higher non-response rate (which has probably increased with caller ID) and (3) written or mail surveys which are least expensive but have a very high non-response rate Follow-up messages can help increase the response rate

4 Archival Research

Analysis of pre-existing data or records Archival research often involves content analysis a qualitative analysis of material For example one would use content analysis to determine whether there had been an increase in the frequency with which women and minorities were mentioned in US history books between 1920 and 2000 Some archival research is quasi-experimental

III EXPERIMENTAL RESEARCH AND ITrsquoS STAGES

Science revolves around experiments and learning the best way of conducting an experiment is crucial to obtaining useful and valid results When scientists speak of experiments in the strictest sense of the word they mean a true experiment where the scientist controls all of the factors and conditions Real world observations and case studies should be referred to as observational research rather than experiments For example observing animals in the wild is not a true experiment because it does not isolate and manipulate an independent variable

THE BASIS OF CONDUCTING AN EXPERIMENT

With an experiment the researcher is trying to learn something new about the world an explanation of lsquowhyrsquo something happens The experiment must maintain internal and external validity or the results will be useless When designing an experiment a researcher must follow all of the steps of the scientific method from making sure that the hypothesis is valid and testable to using controls and statistical tests

Whilst all scientists use reasoning operationalization and the steps of the scientific process it is not always a conscious process Experience and practice mean that many scientists follow an instinctive process of conducting an experiment the lsquostreamlinedrsquo scientific process Following the basic steps will usually generate valid results but where experiments are complex and expensive it is always advisable to follow the rigorous scientific protocols

Conducting a experiment has a number of stages where the parameters and structure of the experiment are made clear Whilst it is rarely practical to follow each step strictly any aberrations must be justified whether they arise because of budget impracticality or ethics

STAGE ONE

After deciding upon a hypothesis and making predictions the first stage of conducting an experiment is to specify the sample groups These should be large enough to give a statistically viable study but small enough to be practical Ideally groups should be selected at random from a wide selection of the sample population This allows results to be generalized to the population as a whole In the physical sciences this is fairly easy but the biological and behavioral sciences are often limited by other factors

For example medical trials often cannot find random groups Such research often relies upon volunteers so it is difficult to apply any realistic randomization This is not a problem as long as the process is justified and the results are not applied to the population as a whole If a psychological researcher used volunteers who were male students aged between 18 and 24 the findings can only be generalized to that specific demographic group within society

STAGE TWO

The sample groups should be divided into a control group and a test group to reduce the possibility of confounding variables This again should be random and the assigning of subjects to groups should be blind or double blind This will reduce the chances of experimental error or bias when conducting an experiment

Ethics are often a barrier to this process because deliberately withholding treatment is not permitted Again any deviations from this process must be explained in the conclusion There is nothing wrong with compromising upon randomness where necessary as long as other scientists are aware of how and why the researcher selected groups on that basis

STAGE THREE

This stage of conducting an experiment involves determining the time scale and frequency of sampling to fit the type of experiment For example researchers studying the effectiveness of a cure for colds would take frequent samples over a period of days Researchers testing a cure for Parkinsonrsquos disease would use less frequent tests over a period of months or years

STAGE FOUR

The penultimate stage of the experiment involves performing the experiment according to the methods stipulated during the design phase The independent variable is manipulated generating a usable data set for the dependent variable

STAGE FIVE

The raw data from the results should be gathered and analyzed by statistical means This allows the researcher to establish if there is any relationship between the variables and accept or reject the null hypothesis

These steps are essential to providing excellent results Whilst many researchers do not want to become involved in the exact processes of inductive reasoning deductive reasoning and operationalization they all follow the basic steps of conducting an experiment This ensures that their results are valid

that is suitable for the conduct of research project This selection is important as the use of unsuitable methods affect the quality of research work(11) Dynamic character MR is dynamic in nature Its scope is fast expanding along with the new developments in the field of marketing This is natural as MR is essentially for dealing with new problems and challenges in the field of marketing In addition developments in other subjects such as economics statistics computer science sociology psychology cultural anthropology and behavioral sciences also bring corresponding changes in the field of MR New methods new techniques etc are used while conducting the research activities This suggests that MR is a dynamic and progressive subject with new developments taking place regularly(12) Closely connected with marketing information system Both the concepts are interrelated In fact MR is one component of MIS Both are useful for solving marketing problems and for accurate and quick decision-making in the field of marketing(13) Phenomenal growth MR has made a phenomenal growth since its inception It has become an important tool in the hands of management (to solve marketing problems) along with the advent of consumer-oriented philosophy in modern business The increasing research budgets of companies are the indicators of its tremendous growth in recent years

AIMS AND OBJECTIVES OF MARKETING RESEARCHThe aims of the marketing research and analysis may be stated as follows(1) To study the needs wants and expectations of consumers(2) To find out reactions of consumers to the products of the company(3) To evaluate companys sales promotion measures for suitable adjustment and improvement(4) To study current marketing problems and opportunities for suitable follow-up actions(5) To suggest the introduction of new products modifications of existing products and to discover new uses of existing products(6) To design and test appropriate packages of companys products and make packaging as attractive as possible(7) To study existing pricing channels of distribution and market competition for suitable changes if necessary(8) To find out methods for making the products of the company popular and raising its goodwill and market reputation(9) To assess competitive strength and policies(10) To estimate potential buying-power in various areas(11) To know the companys expected share of the market(12) To determine the dimensions of the marketing problems facilitate evaluation of the alternative solutions of different problems and help in the selection of a right course of action(13) To define the probable market for a specialized product and to report on general market conditions and tendencies buying habits etc

MARKET RESEARCH VS MARKETING RESEARCHThe two terms ldquomarket research and marketing research are used interchangeably though there is difference in the meaning and scope of the two terms Market research is used as a popular synonym for marketing research Market is a part of marketing and market research is only a part of marketing research It covers only a few aspects of marketing According to Philip Kotler the term market research is accurate for describing research into the market its size geographical

distribution income and so on However it fails to cover the idea of research into the effects of marketing efforts on the market for which the term marketing research is more accurate MR is increasingly coming into favor as the term that describes both ideas Marketing research need not be treated as pure academic research It is a type of applied research with scientific orientation

Distinction between market research and marketing research

DimensionMarket ResearchMarketing ResearchMeaningMarket research directly relates to market situation ie size location market competition and features of customers It provides details about the market for decision-making and policy framingMarketing research is a systematic and comprehensive searchstudy of different aspects of marketing - including the current marketing problems and challenges for decision-making amp policy framingNatureMarket research is a branch of marketing research

Marketing research is one branch of Marketing Information SystemScopeThe scope of market research is limitedrestricted to the study of market or market situation

The scope of marketing research is comprehensive amp wide as it covers all aspects of marketingType of termMarket research is a narrow term as it relates to one aspect of marketing

Marketing research is a widebroad term as it covers all aspects of marketingObjectiveMarket research is undertaken in order to deal with the problems and challenges relating to different aspects of market such as competition market demand and consumer needs

Marketing research is undertaken in order to study varied types of marketing problems such as product line marketing mix advertising packaging branding and so on

GROWING IMPORTANCE OF MARKETING RESEARCH

Marketing research has received attention and importance along with the growth of highly competitive consumer-oriented marketing philosophy Research activities in different aspects of marketing are necessary and useful in such competitive and flexible marketing environment Large companies marketing consumer items noted the growing need of MR activities in the marketing decision-making process They naturally took initiative in conducting research activities within the organization itself This was followed by the formation of specialized marketing research agencies and advertising agencies for this purpose This is how professional orientation was given to MR

Many marketing research departments and agencies were established after World War II

MR activity (as we understand today) is comparatively new in the field of marketing This activity probably began around 1950s (Modern era of marketing research) and attracted the attention of companies interested in marketing their products in the national and global markets However the concept of MR got firm roots in the marketing activity after 1910 First time the marketing research techniques were used by newspapers to predict the election results However during the second decade of 20th century marketing research emerged as a valuable management tool to solve marketing problems In the developed countries marketing research activity is conducted on scientific lines Even in India large manufacturing companies treat marketing research as an essential supplement of planning and decision-making in the marketing field It is treated as an indispensable tool for profitable and consumer-oriented marketing The popularity of MR increased after 1960 due to the introduction of computers in data collection and analysis In the early period marketing research activities were confined to market studies only but in 1950s research relating to marketing activities was broadened to include all managerial aspects-price produce place and promotion In late 1950s motivational and psychological techniques were introduced to generate more information on consumers

Several factors have contributed to the growing importance of marketing research For example due to large-scale production producers could not have direct contact with the consumers This created many problems before producers For solving all such problems developed due to the gap between producers and consumer and marketing research activities prove to be useful

Secondly the shifting from sellersrsquo market to buyers market made it necessary to have better understanding about consumer net-expectations For this marketing research proved to be useful

Thirdly the introduction of computers has contributed to the growth of marketing research activity

Fourthly rapid changes in the business environment shift to consumer-oriented philosophy in business are also responsible for growing importance of marketing research

Finally the scope of marketing has widened due to population growth and development of rural markets MR proved to be useful for dealing with the problems created by national and global markets In brief growing importance of marketing research in the present marketing system is the net result of various factors and forces available in the present marketing system At present MR activities are undertaken by marketing companies on their own In addition marketing research consultants and agencies provide expert advice to companies on general and specific marketing problems of their clients

Relevance of MR under GlobalizationThe business world is fast moving towards globalization in which all countries participate Every country has to face competition in the domestic as well as in export marketing Survival in the global business is possible through quality improvement cost reduction and by attracting consumers through various sales promotion techniques Here MR offers helping hand to companies It offers

suggestions for survival under global competitive environment In brief the importancerelevance of MR is fast growing along with the globalization of business It is a must for survival and growth under globalization Current marketing scenario is different as compared to traditional one There is a new trend towards liberalization and globalization Markets (domestic as well as foreign) are becoming highly competition New companies and new products re entering in the markets Survival is difficult under the present marketing environment Here MR offers various services It is now a professional activity with new developments in regard to scopecoverage and techniques In brief MR has great relevance in the current marketing scenario in India as well as in all countries- developed and developing of the world MR has enormous capacity to help and guide marketing companies in regard to their marketing problems and challenges

FUNCTIONS OF MARKETING RESEARCHMR performs five basic functions These are Description evaluation explanation prediction and finally aid in decision-making These functions are related to the research project undertaken Usually every research study performs all the five functions explained below(1) Description MR provides data and gives informationdescription of customers who buy the product This includes information about their agesex education income and the amount of money that they are willing to spend on the product Description of the customers is useful in order to draw certain conclusions about the customers and their buying behavior Even marketing strategies can be decided as per the information available(2) Evaluation MR is useful for understanding the viewsreactions of the buyers This includes views of consumers on packaging advertisingsales promotion measures used A manufacturer gets these details as well as the information about his product in comparison with the products of his competitors This facilitates evaluation of the marketing policies For example how far the packaging of the product is attractive to consumers or superior as compared to packaging by competitors and so on(3) Explanation MR gives explanation to certain questions of a manufacturer It may be related to decline in sales retailers negative reaction or resistance of consumers in a particular marketing area MR enables a manufacturer to understand why sales are reducing (causes) or why the response of the retailers is negative or why consumers in a particular region are not willing to purchase a specific product Such explanation is important as it enables a manufacturer to adjust his marketing policies in order to rectify the prevailing unfavorable situation(4) Prediction MR conducts prediction function Such predictions may be related to consumers market environmentmarket competition possible socio-economic changes and so on This prediction function enables a manufacturer to understand how much people will spend on the specific product in the next year or the fashions that consumers may prefer in the next year In addition prediction about the possible turnover in the years to come is also possible through suitable marketing research studies In brief marketing research is useful for understanding the marketing environment likely to develop in future This facilitates proper adjustment in the marketing policies for the future period In this sense the prediction function is important even when all predictions made through research studies may not prove to be fully correct However the trend indicated can be used for appropriate policy decisions(5) Aid in Decision-making One more function of MR is to facilitate the process of decision-making in the marketing field MR guides the manufacturer as regards the manner in which he can make

effective advertising appeal or create incentive among his salesmendistributors It also gives him guidance as regards price fixation and sales promotion techniques that will be useful for the future period This function of marketing research is closely related to other functions that it performs These functions facilitate reasonably correct decision-making by marketing managers

They also suggest the practical utility of MR activities

MR functions provide feedback (information and guidance) to marketing managers and improve the quality of their decision-making This practice is certainly safer as compared to decision-making on the basis of past experience or intuition When reality is complex and many facts are not detectable intuition is not adequate for decision-making Similarly experience is useful but decisions on experience alone may not be accurate

Large companies and professional executives prefer to resort to marketing research than depending on experience This is because information available is based on real data and is more reliable dependable This facilitates correct decision-making Thus marketing executives should prefer decisions on the basis of information supplied through marketing research Such decisions are likely to be more accurate as they are based on actual market situation

In brief the basic function of MR is to support marketing decision-making process Marketing research does not provide ready-made decisions or exact solutions on all marketing problems It only provides the clues or possible solutions that should be taken into consideration in the decision-making process It provides support to skills and abilities of marketing managers

The different functions of marketing research are supplementary in character These functions enable a manufacturer to keep close touch with the marketing situation and enable him to make suitable changes in his marketing policies and programmers They also suggest the role marketing research activity in modern competitive and consumer oriented marketing Marketing research functions certainly improve the quality of decision-making by marketing managers

ADVANTAGESIMPORTANCE OF MARKETING RESEARCH1 Indicates current market trends Marketing research keeps business unit in touch with the current market trends and offers guidance for facing market situation with confidence2 Pinpoints deficiencies in marketing policies MR pinpoints the deficiencies as regards products pricing promotion etc It gives guidance regarding different aspects of marketing They include product development branding packaging and advertising3 Explains customer resistance MR is useful for finding out customer resistance to companys products The researcher also suggests remedial measures to deal with the situation This makes the products and marketing policies agreeable to consumers4 Suggests sales promotion techniques MR enables a manufacturer to introduce appropriate sales promotion techniques select most convenient channel of distribution suitable pricing policy for the products and provision of discounts and concessions to dealers Marketing research facilitates sales promotion5 Offers guidance to marketing executives MR offers information and guidance to marketing

executives while framing marketing policies Continuous research enables a company to face adverse marketing situation boldly It acts as an insurance against possible changes in market environment6 Facilitates selection and training of sales force Marketing research is useful for the selection and training of staff in the sales organization It also suggests the incentives that should be offered for motivation of employees concerned with marketing7 Promotes business activities Marketing research enables a business unit to growexpand its activities It creates goodwill in the market and also enables a business unit to earn high profits through consumer-oriented marketing policies and programmers8 Facilitates appraisal of marketing policies Research activities enable business executives to have an appraisal of the present marketing policies in the light of findings of research work Suitable adjustments in the policies are also possible as per the suggestions made by the researchers9 Suggests new marketing opportunities MR suggests new marketing opportunities and the manner in which they can be exploited fully It identifies emerging market opportunities10 Facilitates inventory study Marketing research is useful for the evaluation of companyrsquos inventory policies and also for the introduction of more efficient ways of managing inventories including finished goods and raw materials11 Provides marketing information MR provides information on various aspects of marketing It suggests relative strengths and weaknesses of the company On the basis of such information marketing executives find it easy to frame policies for the future period MR provides information guidance and alternative solutions to current marketing problems12 Suggests appropriate distribution channels MR can be used to study the effectiveness of existing channels of distribution and the need of making suitable changes in the distribution system13 Provides information on product acceptance Marketing research helps in knowing the probability of acceptance of the product in its present form It is also useful for the introduction of modifications in the existing product line of a firm14 Creates progressive outlook MR generates a progressive and dynamic outlook throughout the business organization It promotes systematic thinking and a sense of professionalization within the company It also creates enthusiasm among marketing executives This brings success and stability to the whole business unit15 Has wider social significance MR is of paramount importance from the social angle It is the means by which the ultimate consumer literally becomes king of the market place with his desires prejudices and every whim transmitted to the producer and distributor In brief MR has wider social significance It is useful to all parties involved in the process of marketing

A marketing information system (MIS) is intended to bring together disparate items of data into a coherent body of information An MIS is as will shortly be seen more than raw data or information suitable for the purposes of decision making An MIS also provides methods for interpreting the information the MIS provides Moreover as Kotlers1 definition says an MIS is more than a system of data collection or a set of information technologies

A marketing information system is a continuing and interacting structure of people equipment and procedures to gather sort analyse evaluate and distribute pertinent timely and accurate information for use by marketing decision makers to improve their marketing planning implementation and control

Figure 91 illustrates the major components of an MIS the environmental factors monitored by the system and the types of marketing decision which the MIS seeks to underpin

Figure 91 The marketing information systems and its subsystems

The explanation of this model of an MIS begins with a description of each of its four main constituent parts the internal reporting systems marketing research system marketing intelligence system and marketing models It is suggested that whilst the MIS varies in its degree of sophistication - with many in the industrialised countries being computerised and few in the developing countries being so - a fully fledged MIS should have these components the methods (and technologies) of collection storing retrieving and processing data notwithstanding

Internal reporting systems All enterprises which have been in operation for any period of time nave a wealth of information However this information often remains under-utilised because it is compartmentalised either in the form of an individual entrepreneur or in the functional departments of larger businesses That is information is usually categorised according to its nature so that there are for example financial production manpower marketing stockholding and logistical data Often the entrepreneur or various personnel working in the functional departments holding these pieces of data do not see how it could help decision makers in other functional areas Similarly decision makers can fail to appreciate how information from other functional areas might help them and therefore do not request it

The internal records that are of immediate value to marketing decisions are orders received stockholdings and sales invoices These are but a few of the internal records that can be used by marketing managers but even this small set of records is capable of generating a great deal of information Below is a list of some of the information that can be derived from sales invoices

middot Product type size and pack type by territorymiddot Product type size and pack type by type of accountmiddot Product type size and pack type by industrymiddot Product type size and pack type by customermiddot Average value andor volume of sale by territorymiddot Average value andor volume of sale by type of accountmiddot Average value andor volume of sale by industrymiddot Average value andor volume of sale by sales person

By comparing orders received with invoices an enterprise can establish the extent to which it is providing an acceptable level of customer service In the same way comparing stockholding records with orders received helps an enterprise ascertain whether its stocks are in line with current demand patterns

Marketing research systems The general topic of marketing research has been the prime subject of the textbook and only a little more needs to be added here Marketing research is a proactive search for information That is the enterprise which commissions these studies does so to solve a perceived marketing problem In many cases data is collected in a purposeful way to address a well-defined problem (or a problem which can be defined and solved within the course of the study) The other form of marketing research centres not around a specific marketing problem but is an attempt to continuously monitor the marketing environment These monitoring or tracking exercises are continuous marketing research studies often involving panels of farmers consumers or distributors from which the same data is collected at regular intervals Whilst the ad hoc study and continuous marketing research differs in the orientation yet they are both proactive

Marketing intelligence systems Whereas marketing research is focused market intelligence is not A marketing intelligence system is a set of procedures and data sources used by marketing managers to sift information from the environment that they can use in their decision making This scanning of the economic and business environment can be undertaken in a variety of ways including2

Unfocused scanning

The manager by virtue of what heshe reads hears and watches exposes himherself to information that may prove useful Whilst the behaviour is unfocused and the manager has no specific purpose in mind it is not unintentional

Semi-focused scanning

Again the manager is not in search of particular pieces of information that heshe is actively searching but does narrow the range of media that is scanned For instance the manager may focus more on economic and business publications broadcasts etc and pay less attention to political scientific or technological media

Informal search

This describes the situation where a fairly limited and unstructured attempt is made to obtain information for a specific purpose For example the marketing manager of a firm considering entering the business of importing frozen fish from a neighbouring country may make informal inquiries as to prices and demand levels of frozen and fresh fish There would be little structure to this search with the manager making inquiries with traders heshe happens to encounter as well as with other ad hoc contacts in ministries international aid agencies with trade associations importersexporters etc

Formal search

This is a purposeful search after information in some systematic way The information will be required to address a specific issue Whilst this sort of activity may seem to share the characteristics of marketing research it is carried out by the manager himherself rather than a professional researcher Moreover the scope of the search is likely to be narrow in scope and far less intensive than marketing research

Marketing intelligence is the province of entrepreneurs and senior managers within an agribusiness It involves them in scanning newspaper trade magazines business journals and reports economic forecasts and other media In addition it involves management in talking to producers suppliers and customers as well as to competitors Nonetheless it is a largely informal process of observing and conversing

Some enterprises will approach marketing intelligence gathering in a more deliberate fashion and will train its sales force after-sales personnel and districtarea managers to take cognisance of competitors actions customer complaints and requests and distributor problems Enterprises with vision will also encourage intermediaries such as collectors retailers traders and other middlemen to be proactive in conveying market intelligence back to them

Marketing models Within the MIS there has to be the means of interpreting information in order to give direction to decision These models may be computerised or may not Typical tools are

middot Time series sales modesmiddot Brand switching modelsmiddot Linear programmingmiddot Elasticity models (price incomes demand supply etc)middot Regression and correlation modelsmiddot Analysis of Variance (ANOVA) modelsmiddot Sensitivity analysismiddot Discounted cash flowmiddot Spreadsheet what if models

These and similar mathematical statistical econometric and financial models are the analytical subsystem of the MIS A relatively modest investment in a desktop computer is enough to allow an enterprise to automate the analysis of its data Some of the models used are stochastic ie those containing a probabilistic element whereas others are deterministic models where chance plays no part Brand switching models are stochastic since these express brand choices in probabilities whereas linear programming is deterministic in that the relationships between variables are expressed in exact mathematical terms

THE MARKETING RESEARCH PROCESS

a Marketing Research an Introduction

Every marketer needs marketing research and most large companies have their own marketingresearch departments Marketing research involves a four-step process The first step consists ofthe manager and researcher carefully defining the problem and setting the research objectives Theobjective may be exploratory descriptive or causal The second step consists of developing the

research plan for collecting data from primary and secondary sources Primary data collection callsfor choosing a research approach (observation survey experiment) choosing a contact method(mail telephone personal) designing a sampling plan (whom to survey how many to survey andhow to choose them) and developing research instruments (questionnaire mechanical) The thirdstep consists of implementing the marketing research plan by collecting processing and analyzingthe information The fourth step consists of interpreting and reporting the findings Furtherinformation analysis helps marketing managers to apply the information and provides advancedstatistical procedures and models to develop more rigorous findings from the informationSome marketers face special marketing research considerations such as conducting research insmall-business non-profit or international situations Marketing research can be conductedeffectively by small organizations with small budgets International marketing researchers follow the same steps as domestic researchers but often face more challenging problems All organizations need to understand the major public policy and ethics issues surrounding marketing research

b Uses amp Application of Research in Marketing

Decision-making is crucial process in all types of the organization This decision-making requiresthen information that is collected and acquired through the marketing research process thisinformation can be regarding customers companies or competitor or the other environmentalfactors Major uses of the marketing research in the organizations are as following1048713 Measurement of market potential1048713 Analysis of market share1048713 Determination of market characteristics1048713 Sales analysis1048713 Product testing1048713 Forecasting1048713 Studies of business trends1048713 Studies of competitors products

c THE MARKETING RESEARCH PROCESS

Before researcher can provide managers with information they mustknow what kind of problem the manager wishes to solve Marketingresearch process has following steps1 Defining the problem and research objectives2 Developing the research plan3 Implementing the research plan and4 Interpreting and reporting the findings

Now we will discuss these steps in detail

Step 1 Defining the Problem and Research Objectives

The marketing manager and the researcher must work closely together to define the problemcarefully and agree on the research objectives Marketing managers must know enough aboutmarketing research to help in the planning and to interpret research results Defining the problemand research objectives is often the hardest step in the process After the problem has been definedcarefully the manager and researcher must set the research objectives The three general types ofobjectives are1) Exploratory research where the objective is to gather preliminary information thatwill help to better define problems and suggest hypotheses for their solution2) Descriptive research is where the intent is to describe things such as the marketpotential for a product or the demographics and attitudes of customers who buy the product3) Casual research is research to test hypotheses about cause-and-effect relationshipsThe statement of the problem and research objectives will guide the entire research process It isalways best to put the problem and research objectives statements in writing so agreement can bereached and everyone knows the direction of the research effort

Step 2 Developing the Research Plan

In developing the research plan the attempt is to determine the information needed (outlinesources of secondary data) develop a plan for gathering it efficiently and presenting the plan tomarketing management The plan spells out specific research approaches contact methodssampling plans and instruments that researchers will use to gather new data The firm shouldknow what data already exists before the process of collecting new data begins The steps thatshould be followed are Developing the research plan involves all of the following1 Determining Specific Information Needs2 Gathering Secondary Information3 Planning Primary Data Collection

1) Determine specific information needs

In this step research objectives are translatedinto specific information needs For example determine the demographic economic and lifestylecharacteristics of a target audience

2) Gathering secondary information

a) Secondary data is information that already exists somewhere having beencollected for another purpose Sources of secondary data include both internal and externalsources Companies can buy secondary data reports from outside suppliers (ie commercial datasources)Information can be obtained by using commercial online databases Examples includeCompuServe Dialog and Lexis-Nexus Many of these sources are free Advantages of secondarydata include1 It can usually be obtained more quickly and at a lower cost than primary data2 Sometimes data can be provided that an individual company could not collect on its own

Some problems with collecting secondary data include1 The needed information might not exist2 Even if the data is found it might not be useable3 The researcher must evaluate secondary information to make certain it is relevantaccurate current and impartial Secondary data is a good starting point however the company willoften have to collect primary datab) Primary data is information collected for the specific purpose at hand

Planning Primary Data Collection

A plan for primary data collection calls for a number ofdecisions on research approaches contact methods sampling plans and research instruments

Research Approaches

a) Research approaches can be listed as

1 Observational research

where information is gained by observing relevantpeople actions and situations However some things such as feelingsattitudes motives and private behavior cannot be observed Mechanicalobservation can be obtained through single source data systems This iswhere electronic monitoring systems link consumersrsquo exposure to televisionadvertising and promotion (measured using television meters) with what theybuy in stores (measured using store checkout scanners) Observationalresearch can be used to obtain information that people are unwilling orunable to provide

2 Survey research

is the gathering of primary data by asking people questionsabout their knowledge attitudes preferences and buying behavior Survey research is best suitedfor gathering descriptive information Survey research is the most widely used form of primarydata collection The major advantage of this approach is flexibility while the disadvantages includethe respondent being unwilling to respond giving inaccurate answers or unwilling to spend thetime to answer

3 Experimental research

involves the gathering of primary data by selectingmatched groups of subjects giving them different treatments controlling related factors andchecking for differences in-group responses This form of research tries to explain cause-andeffectrelationships Observation and surveys may be used to collect information in experimentalresearch This form is best used for causal information

In last Lesson we discussed the marketing research process first two steps were discussed in thatLesson today we will continue the same topic and will be discussing the remaining steps of themarketing research process Second topic of todayrsquos Lesson is an introduction to the consumer

behaviorSo our todayrsquos topics are

A THE MARKETING RESEARCH PROCESS (Continued)

B CONSUMER MARKET

Contact Methods

Contact methods are used to obtain the information Contact methods can be listed as1 Mail questionnaires--used to collect large amounts of information at a low cost2 Telephone interviewing--good method for collecting information quickly3 Personal interviewing (which can be either individual or group interviewing)A form of personal interviewing is ldquofocus group interviewingrdquoFocus-group interviewing consists of inviting six to ten people to gather for a few hours with atrained interviewer to talk about a product service or organization The interviewer ldquofocusesrdquothe group discussion on important issues4 Online (Internet) marketing research can consist of Internet surveys or online focus groupsMany experts predict that online research will soon be the primary tool of marketing researchers5 Computer interviewing is a new method being used in the technology age Consumers readquestions from a computer screen and respondSampling plans are used to outline how samples will be constructed and used1 A sample is a segment of the population selected for marketing research to represent thepopulation as a whole2 Marketing researchers usually draw conclusions about large groups of consumers bystudying a small sample of the total consumer population3 Designing a sample calls for three decisionsa Who is to be surveyed (what sampling unit)b How many people should be surveyed (what sample size)c How should the sample be chosen (what sampling procedure)4 Kinds of samples includea Probability samples--each population member has a known chance of beingincluded in the sample and researchers can calculate confidence limits for samplingerrorb Nonprobability samples--sampling error cannot be measuredResearch InstrumentsIn collecting primary data marketing researchers have a choice of two main researchinstrumentsmdashthe questionnaire and mechanical devices The questionnaire is by far the mostcommon instrument whether administered in person by phone or online Questionnaires are veryflexiblemdashthere are many ways to ask questions However they must be developed carefully andtested before they can be used on a large scale A carelessly prepared questionnaire usually containsseveral errors In preparing a questionnaire the marketing researcher must first decide what questions to askQuestionnaires frequently leave out questions that should be answered and include questions that

cannot be answered will not be answered or need not be answered Each question should bechecked to see that it contributes to the research objectivesThe form of each question can influence the response Marketing researchers distinguish betweenclosed-end questions and open-end questions Closed-end questions include all the possibleanswers and subjects make choices among them Examples include multiple-choice questions andscale questions Open-end questions allow respondents to answer in their own words Open-endquestions often reveal more than closed-end questions because respondents are not limited in theiranswers Open-end questions are especially useful in exploratory research when the researcher istrying to find out what people think but not measuring how many people think in a certain wayClosed-end questions on the other hand provide answers that are easier to interpret and tabulateResearchers should also use care in the wording and ordering of questions They should usesimple direct unbiased wording Questions should be arranged in a logical order The firstquestion should create interest if possible and difficult or personal questions should be asked lastso that respondents do not become defensiveAlthough questionnaires are the most common research instrument mechanical instruments alsoare used We discussed two mechanical instruments people meters and supermarket scannersearlier in the chapter Another group of mechanical devices measures subjects physical responses

Step 3 Implementing the Research Plan

The researcher next puts the marketing research plan into action This involves collectingprocessing and analyzing the information Data collection can be carried out by the companysmarketing research staff or by outside firms The company keeps more control over the collectionprocess and data quality by using its own staff However outside firms that specialize in datacollection often can do the job more quickly and at a lower costThe data collection phase of the marketing research process is generally the most expensive andthe most subject to error The researcher should watch fieldwork closely to make sure that the planis implemented correctly and to guard against problems with contacting respondents withrespondents who refuse to cooperate or who give biased or dishonest answers and withinterviewers who make mistakes or take shortcuts

Step 4 Interpreting and Reporting the Findings

The final step in the marketing research process is interpreting and reporting the findings Theresearchers should keep from overwhelming managers with numbers and fancy statisticaltechniques Researchers should present important findings that are useful in the major decisionsfaced by management Interpretation should not be left only to researchers Marketing managerswill also have important insights into the problems Interpretation is an important phase of themarketing process The best research is meaningless if the manager blindly accepts wronginterpretations from the researcherThe researcher must now interpret the findings draw conclusions and report them tomanagement The researcher should not try to overwhelm managers with numbers and fancystatistical techniques Rather the researcher should present important findings that are useful inthe major decisions faced by managementHowever interpretation should not be left only to the researchers They are often experts inresearch design and statistics but the marketing manager knows more about the problem and the

decisions that must be made

In many cases findings can be interpreted in different ways anddiscussions between researchers and managers will help point to the best interpretations Themanager will also want to check that the research project was carried out properly and that all thenecessary analysis was completed Or after seeing the findings the manager may have additionalquestions that can be answered through further sifting of the data Finally the manager is the onewho ultimately must decide what action the research suggests The researchers may even make thedata directly available to marketing managers so that they can perform new analyses and test newrelationships on their ownInterpretation is an important phase of the marketing process The best research is meaningless ifthe manager blindly accepts faulty interpretations from the researcher Similarly managers may bebiasedmdashthey might tend to accept research results that show what they expected and to rejectthose that they did not expect or hope for Thus managers and researchers must work togetherclosely when interpreting research results and both must share responsibility for the researchprocess and resulting decisions

RESEARCH DESIGN

Exploratory research and itrsquos methods

Exploratory research is conducted to clarify ambiguous problems Management may have discovered general problems but research is needed to gain better understanding of the dimensions of the problems Exploratory studies provide information to use in analyzing a situation but uncovering conclusive evidence to determine a particular course of action is not the purpose of exploratory research Usually exploratory research is conducted with the expectation that subsequent research will be required to provide conclusive evidence It is a serious mistake to rush into detailed surveys before less expensive and more readily available sources of information have been exhausted

In an organisation considering a program to help employees with childcare needs for example exploratory research with a small number of employees who have children might determine that many of them have spouses who also work and that these employees have positive reactions to the possibility of an on-site child-care program In such a case exploratory research helps to crystallize a problem and identify information needs for future research

Exploratory research methods

The quickest and the cheapest way to formulate a hypothesis in exploratory research is by using any of the four methods

Literature search

Experience survey

Focus group

Analysis of selected cases

Literature Search

This refers to ldquoreferring to a literature to develop a new hypothesisrdquo The literature referred are ndash trade journals professional journals market research finding publications statistical publications etc Example Suppose a problem is ldquoWhy are sales downrdquo This can quickly be analyzed with the help of published data which should indicate ldquowhether the problem is an ldquoindustry problemrdquo or a ldquofirm problemrdquo Three possibilities exist to formulate the hypothesis

The companyrsquos market share has declined but industryrsquos figures are normal

The industry is declining and hence the companyrsquos market share is also declining

The industryrsquos share is going up but the companyrsquos share is declining

If we accept the situation that our companyrsquos sales are down despite the market showing an upward trend then we need to analyse the marketing mix variables

Example 1 A TV manufacturing company feels that its market share is declining whereas the overall television industry is doing very well

Example 2 Due to a trade embargo imposed by a country textiles exports are down and hence sales of a company making garment for exports is on the decline

The above information may be used to pinpoint the reason for declining sales

Experience Survey

In experience surveys it is desirable to talk to persons who are well informed in the area being investigated These people may be company executives or persons outside the organisation Here no questionnaire is required The approach adopted in an experience survey should be highly unstructured so that the respondent can give divergent views Since the idea of using experience survey is to undertake problem formulation and not conclusion probability sample need not be used Those who cannot speak freely should be excluded from the sample

Examples

1) A group of housewives may be approached for their choice for a ldquoready to cook productrdquo

2) A publisher might want to find out the reason for poor circulation of newspaper introduced recently He might meet (a) Newspaper sellers (b) Public reading room (c) General public (d) Business community etc

These are experienced persons whose knowledge researcher can use

Focus Group

Another widely used technique in exploratory research is the focus group In a focus group a small number of individuals are brought together to study and talk about some topic of interest The discussion is co-ordinated by a moderator The group usually is of 8-12 persons While selecting these persons care has to be taken to see that they should have a common background and have similar experiences in buying This is required because there should not be a conflict among the group members on the common issues that are being discussed During the discussion future buying attitudes present buying opinion etc are gathered

Most of the companies conducting the focus groups first screen the candidates to determine who will compose the particular group Firms also take care to avoid groups in which some of the participants have their friends and relatives because this leads to a biased discussion Normally a number of such groups are constituted and the final conclusion of various groups are taken for formulating the hypothesis Therefore a key factor in focus group is to have similar groups Normally there are 4-5 groups Some of them may even have 6-8 groups The guiding criteria is to see whether the latter groups are generating additional ideas or repeating the same with respect to the subject under study When this shows a diminishing return from the group the discussions stopped The typical focus group lasts for 1-30 hours to 2 hours The moderator under the focus group has a key role His job is to guide the group to proceed in the right direction

Analysis of selected cases

Analysing a selected case sometimes gives an insight into the problem which is being researched Case histories of companies which have undergone a similar situation may be available These case studies are well suited to carry out exploratory research However the result of investigation of case histories arc always considered suggestive rather than conclusive In case of preference to ldquoready to eat foodrdquo many case histories may be available in the form of previous studies made by competitors We must carefully examine the already published case studies with regard to other variables such as price advertisement changes in the taste etc

II DESCRIPTIVE RESEARCH AND ITrsquoS METHODS

Descriptive research is used to obtain information concerning the current status of the phenomena to describe ldquowhat existsrdquo with respect to variables or conditions in a situation The methods involved range from the survey which describes the status quo the correlation study which investigates the relationship between variables to developmental studies which seek to determine changes over time

Descriptive Research Methods

1 Case Studies

Detailed analysis of a single (or limited number) of people or events Case studies are usually interesting because of the unusualness of the case The major problem with case studies is the problem of objectivity The person who is presenting the case usually has some theoretical orientation It is acceptable for a theoretical orientation to affect onersquos interpretation of events In a case study the theoretical orientation can also lead to the selection of the facts to include in the case It is not surprising that case studies often seem to provide very compelling evidence for a theory Case studies can therefore assist psychology by illustrating how a theory could be applied to a person or events and by assisting with the development of hypotheses for more systematic testing

2 Observational Research

Accounts of the natural behavior of individuals or groups in some setting Unless the observation is unobtrusive there may be some subject reactivity to being observed This often decreases with time a process called habituation Observers cannot usually observe all behaviors all of the time They may use a behavioral checklist and may also use time sampling or event sampling procedures It is important to assess observer bias by the use of interobserver reliability Observational research may also pose ethical problems These can arise when the behaviors being observed are not public behaviors and when the observer joins a group in order to observe the membersrsquo behavior ndash participant observation

3 Survey Research

Structured questions to assess peoples beliefs attitudes and self-reports of behavior If the researcher wishes to generalize the responses to a population it is important to have a representative sample Surveys that rely on self-selection (respond if you are interested) produce non-generalizable results Surveys also provide information for co relational research One can correlate responses to some questions (often demographic questions) with responses to other questions (often attitudes or reports of behavior) Survey question must be clear and unambiguous Even if the questions are unambiguous and non-leading people may display a social desirability bias and give positive or socially acceptable and desirable answers Survey methods include (1) the interview or face-to-face method which is generally viewed as the best method for obtaining a high rate of responses but is also very costly (2) phone surveys which are less expensive but have a higher non-response rate (which has probably increased with caller ID) and (3) written or mail surveys which are least expensive but have a very high non-response rate Follow-up messages can help increase the response rate

4 Archival Research

Analysis of pre-existing data or records Archival research often involves content analysis a qualitative analysis of material For example one would use content analysis to determine whether there had been an increase in the frequency with which women and minorities were mentioned in US history books between 1920 and 2000 Some archival research is quasi-experimental

III EXPERIMENTAL RESEARCH AND ITrsquoS STAGES

Science revolves around experiments and learning the best way of conducting an experiment is crucial to obtaining useful and valid results When scientists speak of experiments in the strictest sense of the word they mean a true experiment where the scientist controls all of the factors and conditions Real world observations and case studies should be referred to as observational research rather than experiments For example observing animals in the wild is not a true experiment because it does not isolate and manipulate an independent variable

THE BASIS OF CONDUCTING AN EXPERIMENT

With an experiment the researcher is trying to learn something new about the world an explanation of lsquowhyrsquo something happens The experiment must maintain internal and external validity or the results will be useless When designing an experiment a researcher must follow all of the steps of the scientific method from making sure that the hypothesis is valid and testable to using controls and statistical tests

Whilst all scientists use reasoning operationalization and the steps of the scientific process it is not always a conscious process Experience and practice mean that many scientists follow an instinctive process of conducting an experiment the lsquostreamlinedrsquo scientific process Following the basic steps will usually generate valid results but where experiments are complex and expensive it is always advisable to follow the rigorous scientific protocols

Conducting a experiment has a number of stages where the parameters and structure of the experiment are made clear Whilst it is rarely practical to follow each step strictly any aberrations must be justified whether they arise because of budget impracticality or ethics

STAGE ONE

After deciding upon a hypothesis and making predictions the first stage of conducting an experiment is to specify the sample groups These should be large enough to give a statistically viable study but small enough to be practical Ideally groups should be selected at random from a wide selection of the sample population This allows results to be generalized to the population as a whole In the physical sciences this is fairly easy but the biological and behavioral sciences are often limited by other factors

For example medical trials often cannot find random groups Such research often relies upon volunteers so it is difficult to apply any realistic randomization This is not a problem as long as the process is justified and the results are not applied to the population as a whole If a psychological researcher used volunteers who were male students aged between 18 and 24 the findings can only be generalized to that specific demographic group within society

STAGE TWO

The sample groups should be divided into a control group and a test group to reduce the possibility of confounding variables This again should be random and the assigning of subjects to groups should be blind or double blind This will reduce the chances of experimental error or bias when conducting an experiment

Ethics are often a barrier to this process because deliberately withholding treatment is not permitted Again any deviations from this process must be explained in the conclusion There is nothing wrong with compromising upon randomness where necessary as long as other scientists are aware of how and why the researcher selected groups on that basis

STAGE THREE

This stage of conducting an experiment involves determining the time scale and frequency of sampling to fit the type of experiment For example researchers studying the effectiveness of a cure for colds would take frequent samples over a period of days Researchers testing a cure for Parkinsonrsquos disease would use less frequent tests over a period of months or years

STAGE FOUR

The penultimate stage of the experiment involves performing the experiment according to the methods stipulated during the design phase The independent variable is manipulated generating a usable data set for the dependent variable

STAGE FIVE

The raw data from the results should be gathered and analyzed by statistical means This allows the researcher to establish if there is any relationship between the variables and accept or reject the null hypothesis

These steps are essential to providing excellent results Whilst many researchers do not want to become involved in the exact processes of inductive reasoning deductive reasoning and operationalization they all follow the basic steps of conducting an experiment This ensures that their results are valid

distribution income and so on However it fails to cover the idea of research into the effects of marketing efforts on the market for which the term marketing research is more accurate MR is increasingly coming into favor as the term that describes both ideas Marketing research need not be treated as pure academic research It is a type of applied research with scientific orientation

Distinction between market research and marketing research

DimensionMarket ResearchMarketing ResearchMeaningMarket research directly relates to market situation ie size location market competition and features of customers It provides details about the market for decision-making and policy framingMarketing research is a systematic and comprehensive searchstudy of different aspects of marketing - including the current marketing problems and challenges for decision-making amp policy framingNatureMarket research is a branch of marketing research

Marketing research is one branch of Marketing Information SystemScopeThe scope of market research is limitedrestricted to the study of market or market situation

The scope of marketing research is comprehensive amp wide as it covers all aspects of marketingType of termMarket research is a narrow term as it relates to one aspect of marketing

Marketing research is a widebroad term as it covers all aspects of marketingObjectiveMarket research is undertaken in order to deal with the problems and challenges relating to different aspects of market such as competition market demand and consumer needs

Marketing research is undertaken in order to study varied types of marketing problems such as product line marketing mix advertising packaging branding and so on

GROWING IMPORTANCE OF MARKETING RESEARCH

Marketing research has received attention and importance along with the growth of highly competitive consumer-oriented marketing philosophy Research activities in different aspects of marketing are necessary and useful in such competitive and flexible marketing environment Large companies marketing consumer items noted the growing need of MR activities in the marketing decision-making process They naturally took initiative in conducting research activities within the organization itself This was followed by the formation of specialized marketing research agencies and advertising agencies for this purpose This is how professional orientation was given to MR

Many marketing research departments and agencies were established after World War II

MR activity (as we understand today) is comparatively new in the field of marketing This activity probably began around 1950s (Modern era of marketing research) and attracted the attention of companies interested in marketing their products in the national and global markets However the concept of MR got firm roots in the marketing activity after 1910 First time the marketing research techniques were used by newspapers to predict the election results However during the second decade of 20th century marketing research emerged as a valuable management tool to solve marketing problems In the developed countries marketing research activity is conducted on scientific lines Even in India large manufacturing companies treat marketing research as an essential supplement of planning and decision-making in the marketing field It is treated as an indispensable tool for profitable and consumer-oriented marketing The popularity of MR increased after 1960 due to the introduction of computers in data collection and analysis In the early period marketing research activities were confined to market studies only but in 1950s research relating to marketing activities was broadened to include all managerial aspects-price produce place and promotion In late 1950s motivational and psychological techniques were introduced to generate more information on consumers

Several factors have contributed to the growing importance of marketing research For example due to large-scale production producers could not have direct contact with the consumers This created many problems before producers For solving all such problems developed due to the gap between producers and consumer and marketing research activities prove to be useful

Secondly the shifting from sellersrsquo market to buyers market made it necessary to have better understanding about consumer net-expectations For this marketing research proved to be useful

Thirdly the introduction of computers has contributed to the growth of marketing research activity

Fourthly rapid changes in the business environment shift to consumer-oriented philosophy in business are also responsible for growing importance of marketing research

Finally the scope of marketing has widened due to population growth and development of rural markets MR proved to be useful for dealing with the problems created by national and global markets In brief growing importance of marketing research in the present marketing system is the net result of various factors and forces available in the present marketing system At present MR activities are undertaken by marketing companies on their own In addition marketing research consultants and agencies provide expert advice to companies on general and specific marketing problems of their clients

Relevance of MR under GlobalizationThe business world is fast moving towards globalization in which all countries participate Every country has to face competition in the domestic as well as in export marketing Survival in the global business is possible through quality improvement cost reduction and by attracting consumers through various sales promotion techniques Here MR offers helping hand to companies It offers

suggestions for survival under global competitive environment In brief the importancerelevance of MR is fast growing along with the globalization of business It is a must for survival and growth under globalization Current marketing scenario is different as compared to traditional one There is a new trend towards liberalization and globalization Markets (domestic as well as foreign) are becoming highly competition New companies and new products re entering in the markets Survival is difficult under the present marketing environment Here MR offers various services It is now a professional activity with new developments in regard to scopecoverage and techniques In brief MR has great relevance in the current marketing scenario in India as well as in all countries- developed and developing of the world MR has enormous capacity to help and guide marketing companies in regard to their marketing problems and challenges

FUNCTIONS OF MARKETING RESEARCHMR performs five basic functions These are Description evaluation explanation prediction and finally aid in decision-making These functions are related to the research project undertaken Usually every research study performs all the five functions explained below(1) Description MR provides data and gives informationdescription of customers who buy the product This includes information about their agesex education income and the amount of money that they are willing to spend on the product Description of the customers is useful in order to draw certain conclusions about the customers and their buying behavior Even marketing strategies can be decided as per the information available(2) Evaluation MR is useful for understanding the viewsreactions of the buyers This includes views of consumers on packaging advertisingsales promotion measures used A manufacturer gets these details as well as the information about his product in comparison with the products of his competitors This facilitates evaluation of the marketing policies For example how far the packaging of the product is attractive to consumers or superior as compared to packaging by competitors and so on(3) Explanation MR gives explanation to certain questions of a manufacturer It may be related to decline in sales retailers negative reaction or resistance of consumers in a particular marketing area MR enables a manufacturer to understand why sales are reducing (causes) or why the response of the retailers is negative or why consumers in a particular region are not willing to purchase a specific product Such explanation is important as it enables a manufacturer to adjust his marketing policies in order to rectify the prevailing unfavorable situation(4) Prediction MR conducts prediction function Such predictions may be related to consumers market environmentmarket competition possible socio-economic changes and so on This prediction function enables a manufacturer to understand how much people will spend on the specific product in the next year or the fashions that consumers may prefer in the next year In addition prediction about the possible turnover in the years to come is also possible through suitable marketing research studies In brief marketing research is useful for understanding the marketing environment likely to develop in future This facilitates proper adjustment in the marketing policies for the future period In this sense the prediction function is important even when all predictions made through research studies may not prove to be fully correct However the trend indicated can be used for appropriate policy decisions(5) Aid in Decision-making One more function of MR is to facilitate the process of decision-making in the marketing field MR guides the manufacturer as regards the manner in which he can make

effective advertising appeal or create incentive among his salesmendistributors It also gives him guidance as regards price fixation and sales promotion techniques that will be useful for the future period This function of marketing research is closely related to other functions that it performs These functions facilitate reasonably correct decision-making by marketing managers

They also suggest the practical utility of MR activities

MR functions provide feedback (information and guidance) to marketing managers and improve the quality of their decision-making This practice is certainly safer as compared to decision-making on the basis of past experience or intuition When reality is complex and many facts are not detectable intuition is not adequate for decision-making Similarly experience is useful but decisions on experience alone may not be accurate

Large companies and professional executives prefer to resort to marketing research than depending on experience This is because information available is based on real data and is more reliable dependable This facilitates correct decision-making Thus marketing executives should prefer decisions on the basis of information supplied through marketing research Such decisions are likely to be more accurate as they are based on actual market situation

In brief the basic function of MR is to support marketing decision-making process Marketing research does not provide ready-made decisions or exact solutions on all marketing problems It only provides the clues or possible solutions that should be taken into consideration in the decision-making process It provides support to skills and abilities of marketing managers

The different functions of marketing research are supplementary in character These functions enable a manufacturer to keep close touch with the marketing situation and enable him to make suitable changes in his marketing policies and programmers They also suggest the role marketing research activity in modern competitive and consumer oriented marketing Marketing research functions certainly improve the quality of decision-making by marketing managers

ADVANTAGESIMPORTANCE OF MARKETING RESEARCH1 Indicates current market trends Marketing research keeps business unit in touch with the current market trends and offers guidance for facing market situation with confidence2 Pinpoints deficiencies in marketing policies MR pinpoints the deficiencies as regards products pricing promotion etc It gives guidance regarding different aspects of marketing They include product development branding packaging and advertising3 Explains customer resistance MR is useful for finding out customer resistance to companys products The researcher also suggests remedial measures to deal with the situation This makes the products and marketing policies agreeable to consumers4 Suggests sales promotion techniques MR enables a manufacturer to introduce appropriate sales promotion techniques select most convenient channel of distribution suitable pricing policy for the products and provision of discounts and concessions to dealers Marketing research facilitates sales promotion5 Offers guidance to marketing executives MR offers information and guidance to marketing

executives while framing marketing policies Continuous research enables a company to face adverse marketing situation boldly It acts as an insurance against possible changes in market environment6 Facilitates selection and training of sales force Marketing research is useful for the selection and training of staff in the sales organization It also suggests the incentives that should be offered for motivation of employees concerned with marketing7 Promotes business activities Marketing research enables a business unit to growexpand its activities It creates goodwill in the market and also enables a business unit to earn high profits through consumer-oriented marketing policies and programmers8 Facilitates appraisal of marketing policies Research activities enable business executives to have an appraisal of the present marketing policies in the light of findings of research work Suitable adjustments in the policies are also possible as per the suggestions made by the researchers9 Suggests new marketing opportunities MR suggests new marketing opportunities and the manner in which they can be exploited fully It identifies emerging market opportunities10 Facilitates inventory study Marketing research is useful for the evaluation of companyrsquos inventory policies and also for the introduction of more efficient ways of managing inventories including finished goods and raw materials11 Provides marketing information MR provides information on various aspects of marketing It suggests relative strengths and weaknesses of the company On the basis of such information marketing executives find it easy to frame policies for the future period MR provides information guidance and alternative solutions to current marketing problems12 Suggests appropriate distribution channels MR can be used to study the effectiveness of existing channels of distribution and the need of making suitable changes in the distribution system13 Provides information on product acceptance Marketing research helps in knowing the probability of acceptance of the product in its present form It is also useful for the introduction of modifications in the existing product line of a firm14 Creates progressive outlook MR generates a progressive and dynamic outlook throughout the business organization It promotes systematic thinking and a sense of professionalization within the company It also creates enthusiasm among marketing executives This brings success and stability to the whole business unit15 Has wider social significance MR is of paramount importance from the social angle It is the means by which the ultimate consumer literally becomes king of the market place with his desires prejudices and every whim transmitted to the producer and distributor In brief MR has wider social significance It is useful to all parties involved in the process of marketing

A marketing information system (MIS) is intended to bring together disparate items of data into a coherent body of information An MIS is as will shortly be seen more than raw data or information suitable for the purposes of decision making An MIS also provides methods for interpreting the information the MIS provides Moreover as Kotlers1 definition says an MIS is more than a system of data collection or a set of information technologies

A marketing information system is a continuing and interacting structure of people equipment and procedures to gather sort analyse evaluate and distribute pertinent timely and accurate information for use by marketing decision makers to improve their marketing planning implementation and control

Figure 91 illustrates the major components of an MIS the environmental factors monitored by the system and the types of marketing decision which the MIS seeks to underpin

Figure 91 The marketing information systems and its subsystems

The explanation of this model of an MIS begins with a description of each of its four main constituent parts the internal reporting systems marketing research system marketing intelligence system and marketing models It is suggested that whilst the MIS varies in its degree of sophistication - with many in the industrialised countries being computerised and few in the developing countries being so - a fully fledged MIS should have these components the methods (and technologies) of collection storing retrieving and processing data notwithstanding

Internal reporting systems All enterprises which have been in operation for any period of time nave a wealth of information However this information often remains under-utilised because it is compartmentalised either in the form of an individual entrepreneur or in the functional departments of larger businesses That is information is usually categorised according to its nature so that there are for example financial production manpower marketing stockholding and logistical data Often the entrepreneur or various personnel working in the functional departments holding these pieces of data do not see how it could help decision makers in other functional areas Similarly decision makers can fail to appreciate how information from other functional areas might help them and therefore do not request it

The internal records that are of immediate value to marketing decisions are orders received stockholdings and sales invoices These are but a few of the internal records that can be used by marketing managers but even this small set of records is capable of generating a great deal of information Below is a list of some of the information that can be derived from sales invoices

middot Product type size and pack type by territorymiddot Product type size and pack type by type of accountmiddot Product type size and pack type by industrymiddot Product type size and pack type by customermiddot Average value andor volume of sale by territorymiddot Average value andor volume of sale by type of accountmiddot Average value andor volume of sale by industrymiddot Average value andor volume of sale by sales person

By comparing orders received with invoices an enterprise can establish the extent to which it is providing an acceptable level of customer service In the same way comparing stockholding records with orders received helps an enterprise ascertain whether its stocks are in line with current demand patterns

Marketing research systems The general topic of marketing research has been the prime subject of the textbook and only a little more needs to be added here Marketing research is a proactive search for information That is the enterprise which commissions these studies does so to solve a perceived marketing problem In many cases data is collected in a purposeful way to address a well-defined problem (or a problem which can be defined and solved within the course of the study) The other form of marketing research centres not around a specific marketing problem but is an attempt to continuously monitor the marketing environment These monitoring or tracking exercises are continuous marketing research studies often involving panels of farmers consumers or distributors from which the same data is collected at regular intervals Whilst the ad hoc study and continuous marketing research differs in the orientation yet they are both proactive

Marketing intelligence systems Whereas marketing research is focused market intelligence is not A marketing intelligence system is a set of procedures and data sources used by marketing managers to sift information from the environment that they can use in their decision making This scanning of the economic and business environment can be undertaken in a variety of ways including2

Unfocused scanning

The manager by virtue of what heshe reads hears and watches exposes himherself to information that may prove useful Whilst the behaviour is unfocused and the manager has no specific purpose in mind it is not unintentional

Semi-focused scanning

Again the manager is not in search of particular pieces of information that heshe is actively searching but does narrow the range of media that is scanned For instance the manager may focus more on economic and business publications broadcasts etc and pay less attention to political scientific or technological media

Informal search

This describes the situation where a fairly limited and unstructured attempt is made to obtain information for a specific purpose For example the marketing manager of a firm considering entering the business of importing frozen fish from a neighbouring country may make informal inquiries as to prices and demand levels of frozen and fresh fish There would be little structure to this search with the manager making inquiries with traders heshe happens to encounter as well as with other ad hoc contacts in ministries international aid agencies with trade associations importersexporters etc

Formal search

This is a purposeful search after information in some systematic way The information will be required to address a specific issue Whilst this sort of activity may seem to share the characteristics of marketing research it is carried out by the manager himherself rather than a professional researcher Moreover the scope of the search is likely to be narrow in scope and far less intensive than marketing research

Marketing intelligence is the province of entrepreneurs and senior managers within an agribusiness It involves them in scanning newspaper trade magazines business journals and reports economic forecasts and other media In addition it involves management in talking to producers suppliers and customers as well as to competitors Nonetheless it is a largely informal process of observing and conversing

Some enterprises will approach marketing intelligence gathering in a more deliberate fashion and will train its sales force after-sales personnel and districtarea managers to take cognisance of competitors actions customer complaints and requests and distributor problems Enterprises with vision will also encourage intermediaries such as collectors retailers traders and other middlemen to be proactive in conveying market intelligence back to them

Marketing models Within the MIS there has to be the means of interpreting information in order to give direction to decision These models may be computerised or may not Typical tools are

middot Time series sales modesmiddot Brand switching modelsmiddot Linear programmingmiddot Elasticity models (price incomes demand supply etc)middot Regression and correlation modelsmiddot Analysis of Variance (ANOVA) modelsmiddot Sensitivity analysismiddot Discounted cash flowmiddot Spreadsheet what if models

These and similar mathematical statistical econometric and financial models are the analytical subsystem of the MIS A relatively modest investment in a desktop computer is enough to allow an enterprise to automate the analysis of its data Some of the models used are stochastic ie those containing a probabilistic element whereas others are deterministic models where chance plays no part Brand switching models are stochastic since these express brand choices in probabilities whereas linear programming is deterministic in that the relationships between variables are expressed in exact mathematical terms

THE MARKETING RESEARCH PROCESS

a Marketing Research an Introduction

Every marketer needs marketing research and most large companies have their own marketingresearch departments Marketing research involves a four-step process The first step consists ofthe manager and researcher carefully defining the problem and setting the research objectives Theobjective may be exploratory descriptive or causal The second step consists of developing the

research plan for collecting data from primary and secondary sources Primary data collection callsfor choosing a research approach (observation survey experiment) choosing a contact method(mail telephone personal) designing a sampling plan (whom to survey how many to survey andhow to choose them) and developing research instruments (questionnaire mechanical) The thirdstep consists of implementing the marketing research plan by collecting processing and analyzingthe information The fourth step consists of interpreting and reporting the findings Furtherinformation analysis helps marketing managers to apply the information and provides advancedstatistical procedures and models to develop more rigorous findings from the informationSome marketers face special marketing research considerations such as conducting research insmall-business non-profit or international situations Marketing research can be conductedeffectively by small organizations with small budgets International marketing researchers follow the same steps as domestic researchers but often face more challenging problems All organizations need to understand the major public policy and ethics issues surrounding marketing research

b Uses amp Application of Research in Marketing

Decision-making is crucial process in all types of the organization This decision-making requiresthen information that is collected and acquired through the marketing research process thisinformation can be regarding customers companies or competitor or the other environmentalfactors Major uses of the marketing research in the organizations are as following1048713 Measurement of market potential1048713 Analysis of market share1048713 Determination of market characteristics1048713 Sales analysis1048713 Product testing1048713 Forecasting1048713 Studies of business trends1048713 Studies of competitors products

c THE MARKETING RESEARCH PROCESS

Before researcher can provide managers with information they mustknow what kind of problem the manager wishes to solve Marketingresearch process has following steps1 Defining the problem and research objectives2 Developing the research plan3 Implementing the research plan and4 Interpreting and reporting the findings

Now we will discuss these steps in detail

Step 1 Defining the Problem and Research Objectives

The marketing manager and the researcher must work closely together to define the problemcarefully and agree on the research objectives Marketing managers must know enough aboutmarketing research to help in the planning and to interpret research results Defining the problemand research objectives is often the hardest step in the process After the problem has been definedcarefully the manager and researcher must set the research objectives The three general types ofobjectives are1) Exploratory research where the objective is to gather preliminary information thatwill help to better define problems and suggest hypotheses for their solution2) Descriptive research is where the intent is to describe things such as the marketpotential for a product or the demographics and attitudes of customers who buy the product3) Casual research is research to test hypotheses about cause-and-effect relationshipsThe statement of the problem and research objectives will guide the entire research process It isalways best to put the problem and research objectives statements in writing so agreement can bereached and everyone knows the direction of the research effort

Step 2 Developing the Research Plan

In developing the research plan the attempt is to determine the information needed (outlinesources of secondary data) develop a plan for gathering it efficiently and presenting the plan tomarketing management The plan spells out specific research approaches contact methodssampling plans and instruments that researchers will use to gather new data The firm shouldknow what data already exists before the process of collecting new data begins The steps thatshould be followed are Developing the research plan involves all of the following1 Determining Specific Information Needs2 Gathering Secondary Information3 Planning Primary Data Collection

1) Determine specific information needs

In this step research objectives are translatedinto specific information needs For example determine the demographic economic and lifestylecharacteristics of a target audience

2) Gathering secondary information

a) Secondary data is information that already exists somewhere having beencollected for another purpose Sources of secondary data include both internal and externalsources Companies can buy secondary data reports from outside suppliers (ie commercial datasources)Information can be obtained by using commercial online databases Examples includeCompuServe Dialog and Lexis-Nexus Many of these sources are free Advantages of secondarydata include1 It can usually be obtained more quickly and at a lower cost than primary data2 Sometimes data can be provided that an individual company could not collect on its own

Some problems with collecting secondary data include1 The needed information might not exist2 Even if the data is found it might not be useable3 The researcher must evaluate secondary information to make certain it is relevantaccurate current and impartial Secondary data is a good starting point however the company willoften have to collect primary datab) Primary data is information collected for the specific purpose at hand

Planning Primary Data Collection

A plan for primary data collection calls for a number ofdecisions on research approaches contact methods sampling plans and research instruments

Research Approaches

a) Research approaches can be listed as

1 Observational research

where information is gained by observing relevantpeople actions and situations However some things such as feelingsattitudes motives and private behavior cannot be observed Mechanicalobservation can be obtained through single source data systems This iswhere electronic monitoring systems link consumersrsquo exposure to televisionadvertising and promotion (measured using television meters) with what theybuy in stores (measured using store checkout scanners) Observationalresearch can be used to obtain information that people are unwilling orunable to provide

2 Survey research

is the gathering of primary data by asking people questionsabout their knowledge attitudes preferences and buying behavior Survey research is best suitedfor gathering descriptive information Survey research is the most widely used form of primarydata collection The major advantage of this approach is flexibility while the disadvantages includethe respondent being unwilling to respond giving inaccurate answers or unwilling to spend thetime to answer

3 Experimental research

involves the gathering of primary data by selectingmatched groups of subjects giving them different treatments controlling related factors andchecking for differences in-group responses This form of research tries to explain cause-andeffectrelationships Observation and surveys may be used to collect information in experimentalresearch This form is best used for causal information

In last Lesson we discussed the marketing research process first two steps were discussed in thatLesson today we will continue the same topic and will be discussing the remaining steps of themarketing research process Second topic of todayrsquos Lesson is an introduction to the consumer

behaviorSo our todayrsquos topics are

A THE MARKETING RESEARCH PROCESS (Continued)

B CONSUMER MARKET

Contact Methods

Contact methods are used to obtain the information Contact methods can be listed as1 Mail questionnaires--used to collect large amounts of information at a low cost2 Telephone interviewing--good method for collecting information quickly3 Personal interviewing (which can be either individual or group interviewing)A form of personal interviewing is ldquofocus group interviewingrdquoFocus-group interviewing consists of inviting six to ten people to gather for a few hours with atrained interviewer to talk about a product service or organization The interviewer ldquofocusesrdquothe group discussion on important issues4 Online (Internet) marketing research can consist of Internet surveys or online focus groupsMany experts predict that online research will soon be the primary tool of marketing researchers5 Computer interviewing is a new method being used in the technology age Consumers readquestions from a computer screen and respondSampling plans are used to outline how samples will be constructed and used1 A sample is a segment of the population selected for marketing research to represent thepopulation as a whole2 Marketing researchers usually draw conclusions about large groups of consumers bystudying a small sample of the total consumer population3 Designing a sample calls for three decisionsa Who is to be surveyed (what sampling unit)b How many people should be surveyed (what sample size)c How should the sample be chosen (what sampling procedure)4 Kinds of samples includea Probability samples--each population member has a known chance of beingincluded in the sample and researchers can calculate confidence limits for samplingerrorb Nonprobability samples--sampling error cannot be measuredResearch InstrumentsIn collecting primary data marketing researchers have a choice of two main researchinstrumentsmdashthe questionnaire and mechanical devices The questionnaire is by far the mostcommon instrument whether administered in person by phone or online Questionnaires are veryflexiblemdashthere are many ways to ask questions However they must be developed carefully andtested before they can be used on a large scale A carelessly prepared questionnaire usually containsseveral errors In preparing a questionnaire the marketing researcher must first decide what questions to askQuestionnaires frequently leave out questions that should be answered and include questions that

cannot be answered will not be answered or need not be answered Each question should bechecked to see that it contributes to the research objectivesThe form of each question can influence the response Marketing researchers distinguish betweenclosed-end questions and open-end questions Closed-end questions include all the possibleanswers and subjects make choices among them Examples include multiple-choice questions andscale questions Open-end questions allow respondents to answer in their own words Open-endquestions often reveal more than closed-end questions because respondents are not limited in theiranswers Open-end questions are especially useful in exploratory research when the researcher istrying to find out what people think but not measuring how many people think in a certain wayClosed-end questions on the other hand provide answers that are easier to interpret and tabulateResearchers should also use care in the wording and ordering of questions They should usesimple direct unbiased wording Questions should be arranged in a logical order The firstquestion should create interest if possible and difficult or personal questions should be asked lastso that respondents do not become defensiveAlthough questionnaires are the most common research instrument mechanical instruments alsoare used We discussed two mechanical instruments people meters and supermarket scannersearlier in the chapter Another group of mechanical devices measures subjects physical responses

Step 3 Implementing the Research Plan

The researcher next puts the marketing research plan into action This involves collectingprocessing and analyzing the information Data collection can be carried out by the companysmarketing research staff or by outside firms The company keeps more control over the collectionprocess and data quality by using its own staff However outside firms that specialize in datacollection often can do the job more quickly and at a lower costThe data collection phase of the marketing research process is generally the most expensive andthe most subject to error The researcher should watch fieldwork closely to make sure that the planis implemented correctly and to guard against problems with contacting respondents withrespondents who refuse to cooperate or who give biased or dishonest answers and withinterviewers who make mistakes or take shortcuts

Step 4 Interpreting and Reporting the Findings

The final step in the marketing research process is interpreting and reporting the findings Theresearchers should keep from overwhelming managers with numbers and fancy statisticaltechniques Researchers should present important findings that are useful in the major decisionsfaced by management Interpretation should not be left only to researchers Marketing managerswill also have important insights into the problems Interpretation is an important phase of themarketing process The best research is meaningless if the manager blindly accepts wronginterpretations from the researcherThe researcher must now interpret the findings draw conclusions and report them tomanagement The researcher should not try to overwhelm managers with numbers and fancystatistical techniques Rather the researcher should present important findings that are useful inthe major decisions faced by managementHowever interpretation should not be left only to the researchers They are often experts inresearch design and statistics but the marketing manager knows more about the problem and the

decisions that must be made

In many cases findings can be interpreted in different ways anddiscussions between researchers and managers will help point to the best interpretations Themanager will also want to check that the research project was carried out properly and that all thenecessary analysis was completed Or after seeing the findings the manager may have additionalquestions that can be answered through further sifting of the data Finally the manager is the onewho ultimately must decide what action the research suggests The researchers may even make thedata directly available to marketing managers so that they can perform new analyses and test newrelationships on their ownInterpretation is an important phase of the marketing process The best research is meaningless ifthe manager blindly accepts faulty interpretations from the researcher Similarly managers may bebiasedmdashthey might tend to accept research results that show what they expected and to rejectthose that they did not expect or hope for Thus managers and researchers must work togetherclosely when interpreting research results and both must share responsibility for the researchprocess and resulting decisions

RESEARCH DESIGN

Exploratory research and itrsquos methods

Exploratory research is conducted to clarify ambiguous problems Management may have discovered general problems but research is needed to gain better understanding of the dimensions of the problems Exploratory studies provide information to use in analyzing a situation but uncovering conclusive evidence to determine a particular course of action is not the purpose of exploratory research Usually exploratory research is conducted with the expectation that subsequent research will be required to provide conclusive evidence It is a serious mistake to rush into detailed surveys before less expensive and more readily available sources of information have been exhausted

In an organisation considering a program to help employees with childcare needs for example exploratory research with a small number of employees who have children might determine that many of them have spouses who also work and that these employees have positive reactions to the possibility of an on-site child-care program In such a case exploratory research helps to crystallize a problem and identify information needs for future research

Exploratory research methods

The quickest and the cheapest way to formulate a hypothesis in exploratory research is by using any of the four methods

Literature search

Experience survey

Focus group

Analysis of selected cases

Literature Search

This refers to ldquoreferring to a literature to develop a new hypothesisrdquo The literature referred are ndash trade journals professional journals market research finding publications statistical publications etc Example Suppose a problem is ldquoWhy are sales downrdquo This can quickly be analyzed with the help of published data which should indicate ldquowhether the problem is an ldquoindustry problemrdquo or a ldquofirm problemrdquo Three possibilities exist to formulate the hypothesis

The companyrsquos market share has declined but industryrsquos figures are normal

The industry is declining and hence the companyrsquos market share is also declining

The industryrsquos share is going up but the companyrsquos share is declining

If we accept the situation that our companyrsquos sales are down despite the market showing an upward trend then we need to analyse the marketing mix variables

Example 1 A TV manufacturing company feels that its market share is declining whereas the overall television industry is doing very well

Example 2 Due to a trade embargo imposed by a country textiles exports are down and hence sales of a company making garment for exports is on the decline

The above information may be used to pinpoint the reason for declining sales

Experience Survey

In experience surveys it is desirable to talk to persons who are well informed in the area being investigated These people may be company executives or persons outside the organisation Here no questionnaire is required The approach adopted in an experience survey should be highly unstructured so that the respondent can give divergent views Since the idea of using experience survey is to undertake problem formulation and not conclusion probability sample need not be used Those who cannot speak freely should be excluded from the sample

Examples

1) A group of housewives may be approached for their choice for a ldquoready to cook productrdquo

2) A publisher might want to find out the reason for poor circulation of newspaper introduced recently He might meet (a) Newspaper sellers (b) Public reading room (c) General public (d) Business community etc

These are experienced persons whose knowledge researcher can use

Focus Group

Another widely used technique in exploratory research is the focus group In a focus group a small number of individuals are brought together to study and talk about some topic of interest The discussion is co-ordinated by a moderator The group usually is of 8-12 persons While selecting these persons care has to be taken to see that they should have a common background and have similar experiences in buying This is required because there should not be a conflict among the group members on the common issues that are being discussed During the discussion future buying attitudes present buying opinion etc are gathered

Most of the companies conducting the focus groups first screen the candidates to determine who will compose the particular group Firms also take care to avoid groups in which some of the participants have their friends and relatives because this leads to a biased discussion Normally a number of such groups are constituted and the final conclusion of various groups are taken for formulating the hypothesis Therefore a key factor in focus group is to have similar groups Normally there are 4-5 groups Some of them may even have 6-8 groups The guiding criteria is to see whether the latter groups are generating additional ideas or repeating the same with respect to the subject under study When this shows a diminishing return from the group the discussions stopped The typical focus group lasts for 1-30 hours to 2 hours The moderator under the focus group has a key role His job is to guide the group to proceed in the right direction

Analysis of selected cases

Analysing a selected case sometimes gives an insight into the problem which is being researched Case histories of companies which have undergone a similar situation may be available These case studies are well suited to carry out exploratory research However the result of investigation of case histories arc always considered suggestive rather than conclusive In case of preference to ldquoready to eat foodrdquo many case histories may be available in the form of previous studies made by competitors We must carefully examine the already published case studies with regard to other variables such as price advertisement changes in the taste etc

II DESCRIPTIVE RESEARCH AND ITrsquoS METHODS

Descriptive research is used to obtain information concerning the current status of the phenomena to describe ldquowhat existsrdquo with respect to variables or conditions in a situation The methods involved range from the survey which describes the status quo the correlation study which investigates the relationship between variables to developmental studies which seek to determine changes over time

Descriptive Research Methods

1 Case Studies

Detailed analysis of a single (or limited number) of people or events Case studies are usually interesting because of the unusualness of the case The major problem with case studies is the problem of objectivity The person who is presenting the case usually has some theoretical orientation It is acceptable for a theoretical orientation to affect onersquos interpretation of events In a case study the theoretical orientation can also lead to the selection of the facts to include in the case It is not surprising that case studies often seem to provide very compelling evidence for a theory Case studies can therefore assist psychology by illustrating how a theory could be applied to a person or events and by assisting with the development of hypotheses for more systematic testing

2 Observational Research

Accounts of the natural behavior of individuals or groups in some setting Unless the observation is unobtrusive there may be some subject reactivity to being observed This often decreases with time a process called habituation Observers cannot usually observe all behaviors all of the time They may use a behavioral checklist and may also use time sampling or event sampling procedures It is important to assess observer bias by the use of interobserver reliability Observational research may also pose ethical problems These can arise when the behaviors being observed are not public behaviors and when the observer joins a group in order to observe the membersrsquo behavior ndash participant observation

3 Survey Research

Structured questions to assess peoples beliefs attitudes and self-reports of behavior If the researcher wishes to generalize the responses to a population it is important to have a representative sample Surveys that rely on self-selection (respond if you are interested) produce non-generalizable results Surveys also provide information for co relational research One can correlate responses to some questions (often demographic questions) with responses to other questions (often attitudes or reports of behavior) Survey question must be clear and unambiguous Even if the questions are unambiguous and non-leading people may display a social desirability bias and give positive or socially acceptable and desirable answers Survey methods include (1) the interview or face-to-face method which is generally viewed as the best method for obtaining a high rate of responses but is also very costly (2) phone surveys which are less expensive but have a higher non-response rate (which has probably increased with caller ID) and (3) written or mail surveys which are least expensive but have a very high non-response rate Follow-up messages can help increase the response rate

4 Archival Research

Analysis of pre-existing data or records Archival research often involves content analysis a qualitative analysis of material For example one would use content analysis to determine whether there had been an increase in the frequency with which women and minorities were mentioned in US history books between 1920 and 2000 Some archival research is quasi-experimental

III EXPERIMENTAL RESEARCH AND ITrsquoS STAGES

Science revolves around experiments and learning the best way of conducting an experiment is crucial to obtaining useful and valid results When scientists speak of experiments in the strictest sense of the word they mean a true experiment where the scientist controls all of the factors and conditions Real world observations and case studies should be referred to as observational research rather than experiments For example observing animals in the wild is not a true experiment because it does not isolate and manipulate an independent variable

THE BASIS OF CONDUCTING AN EXPERIMENT

With an experiment the researcher is trying to learn something new about the world an explanation of lsquowhyrsquo something happens The experiment must maintain internal and external validity or the results will be useless When designing an experiment a researcher must follow all of the steps of the scientific method from making sure that the hypothesis is valid and testable to using controls and statistical tests

Whilst all scientists use reasoning operationalization and the steps of the scientific process it is not always a conscious process Experience and practice mean that many scientists follow an instinctive process of conducting an experiment the lsquostreamlinedrsquo scientific process Following the basic steps will usually generate valid results but where experiments are complex and expensive it is always advisable to follow the rigorous scientific protocols

Conducting a experiment has a number of stages where the parameters and structure of the experiment are made clear Whilst it is rarely practical to follow each step strictly any aberrations must be justified whether they arise because of budget impracticality or ethics

STAGE ONE

After deciding upon a hypothesis and making predictions the first stage of conducting an experiment is to specify the sample groups These should be large enough to give a statistically viable study but small enough to be practical Ideally groups should be selected at random from a wide selection of the sample population This allows results to be generalized to the population as a whole In the physical sciences this is fairly easy but the biological and behavioral sciences are often limited by other factors

For example medical trials often cannot find random groups Such research often relies upon volunteers so it is difficult to apply any realistic randomization This is not a problem as long as the process is justified and the results are not applied to the population as a whole If a psychological researcher used volunteers who were male students aged between 18 and 24 the findings can only be generalized to that specific demographic group within society

STAGE TWO

The sample groups should be divided into a control group and a test group to reduce the possibility of confounding variables This again should be random and the assigning of subjects to groups should be blind or double blind This will reduce the chances of experimental error or bias when conducting an experiment

Ethics are often a barrier to this process because deliberately withholding treatment is not permitted Again any deviations from this process must be explained in the conclusion There is nothing wrong with compromising upon randomness where necessary as long as other scientists are aware of how and why the researcher selected groups on that basis

STAGE THREE

This stage of conducting an experiment involves determining the time scale and frequency of sampling to fit the type of experiment For example researchers studying the effectiveness of a cure for colds would take frequent samples over a period of days Researchers testing a cure for Parkinsonrsquos disease would use less frequent tests over a period of months or years

STAGE FOUR

The penultimate stage of the experiment involves performing the experiment according to the methods stipulated during the design phase The independent variable is manipulated generating a usable data set for the dependent variable

STAGE FIVE

The raw data from the results should be gathered and analyzed by statistical means This allows the researcher to establish if there is any relationship between the variables and accept or reject the null hypothesis

These steps are essential to providing excellent results Whilst many researchers do not want to become involved in the exact processes of inductive reasoning deductive reasoning and operationalization they all follow the basic steps of conducting an experiment This ensures that their results are valid

Many marketing research departments and agencies were established after World War II

MR activity (as we understand today) is comparatively new in the field of marketing This activity probably began around 1950s (Modern era of marketing research) and attracted the attention of companies interested in marketing their products in the national and global markets However the concept of MR got firm roots in the marketing activity after 1910 First time the marketing research techniques were used by newspapers to predict the election results However during the second decade of 20th century marketing research emerged as a valuable management tool to solve marketing problems In the developed countries marketing research activity is conducted on scientific lines Even in India large manufacturing companies treat marketing research as an essential supplement of planning and decision-making in the marketing field It is treated as an indispensable tool for profitable and consumer-oriented marketing The popularity of MR increased after 1960 due to the introduction of computers in data collection and analysis In the early period marketing research activities were confined to market studies only but in 1950s research relating to marketing activities was broadened to include all managerial aspects-price produce place and promotion In late 1950s motivational and psychological techniques were introduced to generate more information on consumers

Several factors have contributed to the growing importance of marketing research For example due to large-scale production producers could not have direct contact with the consumers This created many problems before producers For solving all such problems developed due to the gap between producers and consumer and marketing research activities prove to be useful

Secondly the shifting from sellersrsquo market to buyers market made it necessary to have better understanding about consumer net-expectations For this marketing research proved to be useful

Thirdly the introduction of computers has contributed to the growth of marketing research activity

Fourthly rapid changes in the business environment shift to consumer-oriented philosophy in business are also responsible for growing importance of marketing research

Finally the scope of marketing has widened due to population growth and development of rural markets MR proved to be useful for dealing with the problems created by national and global markets In brief growing importance of marketing research in the present marketing system is the net result of various factors and forces available in the present marketing system At present MR activities are undertaken by marketing companies on their own In addition marketing research consultants and agencies provide expert advice to companies on general and specific marketing problems of their clients

Relevance of MR under GlobalizationThe business world is fast moving towards globalization in which all countries participate Every country has to face competition in the domestic as well as in export marketing Survival in the global business is possible through quality improvement cost reduction and by attracting consumers through various sales promotion techniques Here MR offers helping hand to companies It offers

suggestions for survival under global competitive environment In brief the importancerelevance of MR is fast growing along with the globalization of business It is a must for survival and growth under globalization Current marketing scenario is different as compared to traditional one There is a new trend towards liberalization and globalization Markets (domestic as well as foreign) are becoming highly competition New companies and new products re entering in the markets Survival is difficult under the present marketing environment Here MR offers various services It is now a professional activity with new developments in regard to scopecoverage and techniques In brief MR has great relevance in the current marketing scenario in India as well as in all countries- developed and developing of the world MR has enormous capacity to help and guide marketing companies in regard to their marketing problems and challenges

FUNCTIONS OF MARKETING RESEARCHMR performs five basic functions These are Description evaluation explanation prediction and finally aid in decision-making These functions are related to the research project undertaken Usually every research study performs all the five functions explained below(1) Description MR provides data and gives informationdescription of customers who buy the product This includes information about their agesex education income and the amount of money that they are willing to spend on the product Description of the customers is useful in order to draw certain conclusions about the customers and their buying behavior Even marketing strategies can be decided as per the information available(2) Evaluation MR is useful for understanding the viewsreactions of the buyers This includes views of consumers on packaging advertisingsales promotion measures used A manufacturer gets these details as well as the information about his product in comparison with the products of his competitors This facilitates evaluation of the marketing policies For example how far the packaging of the product is attractive to consumers or superior as compared to packaging by competitors and so on(3) Explanation MR gives explanation to certain questions of a manufacturer It may be related to decline in sales retailers negative reaction or resistance of consumers in a particular marketing area MR enables a manufacturer to understand why sales are reducing (causes) or why the response of the retailers is negative or why consumers in a particular region are not willing to purchase a specific product Such explanation is important as it enables a manufacturer to adjust his marketing policies in order to rectify the prevailing unfavorable situation(4) Prediction MR conducts prediction function Such predictions may be related to consumers market environmentmarket competition possible socio-economic changes and so on This prediction function enables a manufacturer to understand how much people will spend on the specific product in the next year or the fashions that consumers may prefer in the next year In addition prediction about the possible turnover in the years to come is also possible through suitable marketing research studies In brief marketing research is useful for understanding the marketing environment likely to develop in future This facilitates proper adjustment in the marketing policies for the future period In this sense the prediction function is important even when all predictions made through research studies may not prove to be fully correct However the trend indicated can be used for appropriate policy decisions(5) Aid in Decision-making One more function of MR is to facilitate the process of decision-making in the marketing field MR guides the manufacturer as regards the manner in which he can make

effective advertising appeal or create incentive among his salesmendistributors It also gives him guidance as regards price fixation and sales promotion techniques that will be useful for the future period This function of marketing research is closely related to other functions that it performs These functions facilitate reasonably correct decision-making by marketing managers

They also suggest the practical utility of MR activities

MR functions provide feedback (information and guidance) to marketing managers and improve the quality of their decision-making This practice is certainly safer as compared to decision-making on the basis of past experience or intuition When reality is complex and many facts are not detectable intuition is not adequate for decision-making Similarly experience is useful but decisions on experience alone may not be accurate

Large companies and professional executives prefer to resort to marketing research than depending on experience This is because information available is based on real data and is more reliable dependable This facilitates correct decision-making Thus marketing executives should prefer decisions on the basis of information supplied through marketing research Such decisions are likely to be more accurate as they are based on actual market situation

In brief the basic function of MR is to support marketing decision-making process Marketing research does not provide ready-made decisions or exact solutions on all marketing problems It only provides the clues or possible solutions that should be taken into consideration in the decision-making process It provides support to skills and abilities of marketing managers

The different functions of marketing research are supplementary in character These functions enable a manufacturer to keep close touch with the marketing situation and enable him to make suitable changes in his marketing policies and programmers They also suggest the role marketing research activity in modern competitive and consumer oriented marketing Marketing research functions certainly improve the quality of decision-making by marketing managers

ADVANTAGESIMPORTANCE OF MARKETING RESEARCH1 Indicates current market trends Marketing research keeps business unit in touch with the current market trends and offers guidance for facing market situation with confidence2 Pinpoints deficiencies in marketing policies MR pinpoints the deficiencies as regards products pricing promotion etc It gives guidance regarding different aspects of marketing They include product development branding packaging and advertising3 Explains customer resistance MR is useful for finding out customer resistance to companys products The researcher also suggests remedial measures to deal with the situation This makes the products and marketing policies agreeable to consumers4 Suggests sales promotion techniques MR enables a manufacturer to introduce appropriate sales promotion techniques select most convenient channel of distribution suitable pricing policy for the products and provision of discounts and concessions to dealers Marketing research facilitates sales promotion5 Offers guidance to marketing executives MR offers information and guidance to marketing

executives while framing marketing policies Continuous research enables a company to face adverse marketing situation boldly It acts as an insurance against possible changes in market environment6 Facilitates selection and training of sales force Marketing research is useful for the selection and training of staff in the sales organization It also suggests the incentives that should be offered for motivation of employees concerned with marketing7 Promotes business activities Marketing research enables a business unit to growexpand its activities It creates goodwill in the market and also enables a business unit to earn high profits through consumer-oriented marketing policies and programmers8 Facilitates appraisal of marketing policies Research activities enable business executives to have an appraisal of the present marketing policies in the light of findings of research work Suitable adjustments in the policies are also possible as per the suggestions made by the researchers9 Suggests new marketing opportunities MR suggests new marketing opportunities and the manner in which they can be exploited fully It identifies emerging market opportunities10 Facilitates inventory study Marketing research is useful for the evaluation of companyrsquos inventory policies and also for the introduction of more efficient ways of managing inventories including finished goods and raw materials11 Provides marketing information MR provides information on various aspects of marketing It suggests relative strengths and weaknesses of the company On the basis of such information marketing executives find it easy to frame policies for the future period MR provides information guidance and alternative solutions to current marketing problems12 Suggests appropriate distribution channels MR can be used to study the effectiveness of existing channels of distribution and the need of making suitable changes in the distribution system13 Provides information on product acceptance Marketing research helps in knowing the probability of acceptance of the product in its present form It is also useful for the introduction of modifications in the existing product line of a firm14 Creates progressive outlook MR generates a progressive and dynamic outlook throughout the business organization It promotes systematic thinking and a sense of professionalization within the company It also creates enthusiasm among marketing executives This brings success and stability to the whole business unit15 Has wider social significance MR is of paramount importance from the social angle It is the means by which the ultimate consumer literally becomes king of the market place with his desires prejudices and every whim transmitted to the producer and distributor In brief MR has wider social significance It is useful to all parties involved in the process of marketing

A marketing information system (MIS) is intended to bring together disparate items of data into a coherent body of information An MIS is as will shortly be seen more than raw data or information suitable for the purposes of decision making An MIS also provides methods for interpreting the information the MIS provides Moreover as Kotlers1 definition says an MIS is more than a system of data collection or a set of information technologies

A marketing information system is a continuing and interacting structure of people equipment and procedures to gather sort analyse evaluate and distribute pertinent timely and accurate information for use by marketing decision makers to improve their marketing planning implementation and control

Figure 91 illustrates the major components of an MIS the environmental factors monitored by the system and the types of marketing decision which the MIS seeks to underpin

Figure 91 The marketing information systems and its subsystems

The explanation of this model of an MIS begins with a description of each of its four main constituent parts the internal reporting systems marketing research system marketing intelligence system and marketing models It is suggested that whilst the MIS varies in its degree of sophistication - with many in the industrialised countries being computerised and few in the developing countries being so - a fully fledged MIS should have these components the methods (and technologies) of collection storing retrieving and processing data notwithstanding

Internal reporting systems All enterprises which have been in operation for any period of time nave a wealth of information However this information often remains under-utilised because it is compartmentalised either in the form of an individual entrepreneur or in the functional departments of larger businesses That is information is usually categorised according to its nature so that there are for example financial production manpower marketing stockholding and logistical data Often the entrepreneur or various personnel working in the functional departments holding these pieces of data do not see how it could help decision makers in other functional areas Similarly decision makers can fail to appreciate how information from other functional areas might help them and therefore do not request it

The internal records that are of immediate value to marketing decisions are orders received stockholdings and sales invoices These are but a few of the internal records that can be used by marketing managers but even this small set of records is capable of generating a great deal of information Below is a list of some of the information that can be derived from sales invoices

middot Product type size and pack type by territorymiddot Product type size and pack type by type of accountmiddot Product type size and pack type by industrymiddot Product type size and pack type by customermiddot Average value andor volume of sale by territorymiddot Average value andor volume of sale by type of accountmiddot Average value andor volume of sale by industrymiddot Average value andor volume of sale by sales person

By comparing orders received with invoices an enterprise can establish the extent to which it is providing an acceptable level of customer service In the same way comparing stockholding records with orders received helps an enterprise ascertain whether its stocks are in line with current demand patterns

Marketing research systems The general topic of marketing research has been the prime subject of the textbook and only a little more needs to be added here Marketing research is a proactive search for information That is the enterprise which commissions these studies does so to solve a perceived marketing problem In many cases data is collected in a purposeful way to address a well-defined problem (or a problem which can be defined and solved within the course of the study) The other form of marketing research centres not around a specific marketing problem but is an attempt to continuously monitor the marketing environment These monitoring or tracking exercises are continuous marketing research studies often involving panels of farmers consumers or distributors from which the same data is collected at regular intervals Whilst the ad hoc study and continuous marketing research differs in the orientation yet they are both proactive

Marketing intelligence systems Whereas marketing research is focused market intelligence is not A marketing intelligence system is a set of procedures and data sources used by marketing managers to sift information from the environment that they can use in their decision making This scanning of the economic and business environment can be undertaken in a variety of ways including2

Unfocused scanning

The manager by virtue of what heshe reads hears and watches exposes himherself to information that may prove useful Whilst the behaviour is unfocused and the manager has no specific purpose in mind it is not unintentional

Semi-focused scanning

Again the manager is not in search of particular pieces of information that heshe is actively searching but does narrow the range of media that is scanned For instance the manager may focus more on economic and business publications broadcasts etc and pay less attention to political scientific or technological media

Informal search

This describes the situation where a fairly limited and unstructured attempt is made to obtain information for a specific purpose For example the marketing manager of a firm considering entering the business of importing frozen fish from a neighbouring country may make informal inquiries as to prices and demand levels of frozen and fresh fish There would be little structure to this search with the manager making inquiries with traders heshe happens to encounter as well as with other ad hoc contacts in ministries international aid agencies with trade associations importersexporters etc

Formal search

This is a purposeful search after information in some systematic way The information will be required to address a specific issue Whilst this sort of activity may seem to share the characteristics of marketing research it is carried out by the manager himherself rather than a professional researcher Moreover the scope of the search is likely to be narrow in scope and far less intensive than marketing research

Marketing intelligence is the province of entrepreneurs and senior managers within an agribusiness It involves them in scanning newspaper trade magazines business journals and reports economic forecasts and other media In addition it involves management in talking to producers suppliers and customers as well as to competitors Nonetheless it is a largely informal process of observing and conversing

Some enterprises will approach marketing intelligence gathering in a more deliberate fashion and will train its sales force after-sales personnel and districtarea managers to take cognisance of competitors actions customer complaints and requests and distributor problems Enterprises with vision will also encourage intermediaries such as collectors retailers traders and other middlemen to be proactive in conveying market intelligence back to them

Marketing models Within the MIS there has to be the means of interpreting information in order to give direction to decision These models may be computerised or may not Typical tools are

middot Time series sales modesmiddot Brand switching modelsmiddot Linear programmingmiddot Elasticity models (price incomes demand supply etc)middot Regression and correlation modelsmiddot Analysis of Variance (ANOVA) modelsmiddot Sensitivity analysismiddot Discounted cash flowmiddot Spreadsheet what if models

These and similar mathematical statistical econometric and financial models are the analytical subsystem of the MIS A relatively modest investment in a desktop computer is enough to allow an enterprise to automate the analysis of its data Some of the models used are stochastic ie those containing a probabilistic element whereas others are deterministic models where chance plays no part Brand switching models are stochastic since these express brand choices in probabilities whereas linear programming is deterministic in that the relationships between variables are expressed in exact mathematical terms

THE MARKETING RESEARCH PROCESS

a Marketing Research an Introduction

Every marketer needs marketing research and most large companies have their own marketingresearch departments Marketing research involves a four-step process The first step consists ofthe manager and researcher carefully defining the problem and setting the research objectives Theobjective may be exploratory descriptive or causal The second step consists of developing the

research plan for collecting data from primary and secondary sources Primary data collection callsfor choosing a research approach (observation survey experiment) choosing a contact method(mail telephone personal) designing a sampling plan (whom to survey how many to survey andhow to choose them) and developing research instruments (questionnaire mechanical) The thirdstep consists of implementing the marketing research plan by collecting processing and analyzingthe information The fourth step consists of interpreting and reporting the findings Furtherinformation analysis helps marketing managers to apply the information and provides advancedstatistical procedures and models to develop more rigorous findings from the informationSome marketers face special marketing research considerations such as conducting research insmall-business non-profit or international situations Marketing research can be conductedeffectively by small organizations with small budgets International marketing researchers follow the same steps as domestic researchers but often face more challenging problems All organizations need to understand the major public policy and ethics issues surrounding marketing research

b Uses amp Application of Research in Marketing

Decision-making is crucial process in all types of the organization This decision-making requiresthen information that is collected and acquired through the marketing research process thisinformation can be regarding customers companies or competitor or the other environmentalfactors Major uses of the marketing research in the organizations are as following1048713 Measurement of market potential1048713 Analysis of market share1048713 Determination of market characteristics1048713 Sales analysis1048713 Product testing1048713 Forecasting1048713 Studies of business trends1048713 Studies of competitors products

c THE MARKETING RESEARCH PROCESS

Before researcher can provide managers with information they mustknow what kind of problem the manager wishes to solve Marketingresearch process has following steps1 Defining the problem and research objectives2 Developing the research plan3 Implementing the research plan and4 Interpreting and reporting the findings

Now we will discuss these steps in detail

Step 1 Defining the Problem and Research Objectives

The marketing manager and the researcher must work closely together to define the problemcarefully and agree on the research objectives Marketing managers must know enough aboutmarketing research to help in the planning and to interpret research results Defining the problemand research objectives is often the hardest step in the process After the problem has been definedcarefully the manager and researcher must set the research objectives The three general types ofobjectives are1) Exploratory research where the objective is to gather preliminary information thatwill help to better define problems and suggest hypotheses for their solution2) Descriptive research is where the intent is to describe things such as the marketpotential for a product or the demographics and attitudes of customers who buy the product3) Casual research is research to test hypotheses about cause-and-effect relationshipsThe statement of the problem and research objectives will guide the entire research process It isalways best to put the problem and research objectives statements in writing so agreement can bereached and everyone knows the direction of the research effort

Step 2 Developing the Research Plan

In developing the research plan the attempt is to determine the information needed (outlinesources of secondary data) develop a plan for gathering it efficiently and presenting the plan tomarketing management The plan spells out specific research approaches contact methodssampling plans and instruments that researchers will use to gather new data The firm shouldknow what data already exists before the process of collecting new data begins The steps thatshould be followed are Developing the research plan involves all of the following1 Determining Specific Information Needs2 Gathering Secondary Information3 Planning Primary Data Collection

1) Determine specific information needs

In this step research objectives are translatedinto specific information needs For example determine the demographic economic and lifestylecharacteristics of a target audience

2) Gathering secondary information

a) Secondary data is information that already exists somewhere having beencollected for another purpose Sources of secondary data include both internal and externalsources Companies can buy secondary data reports from outside suppliers (ie commercial datasources)Information can be obtained by using commercial online databases Examples includeCompuServe Dialog and Lexis-Nexus Many of these sources are free Advantages of secondarydata include1 It can usually be obtained more quickly and at a lower cost than primary data2 Sometimes data can be provided that an individual company could not collect on its own

Some problems with collecting secondary data include1 The needed information might not exist2 Even if the data is found it might not be useable3 The researcher must evaluate secondary information to make certain it is relevantaccurate current and impartial Secondary data is a good starting point however the company willoften have to collect primary datab) Primary data is information collected for the specific purpose at hand

Planning Primary Data Collection

A plan for primary data collection calls for a number ofdecisions on research approaches contact methods sampling plans and research instruments

Research Approaches

a) Research approaches can be listed as

1 Observational research

where information is gained by observing relevantpeople actions and situations However some things such as feelingsattitudes motives and private behavior cannot be observed Mechanicalobservation can be obtained through single source data systems This iswhere electronic monitoring systems link consumersrsquo exposure to televisionadvertising and promotion (measured using television meters) with what theybuy in stores (measured using store checkout scanners) Observationalresearch can be used to obtain information that people are unwilling orunable to provide

2 Survey research

is the gathering of primary data by asking people questionsabout their knowledge attitudes preferences and buying behavior Survey research is best suitedfor gathering descriptive information Survey research is the most widely used form of primarydata collection The major advantage of this approach is flexibility while the disadvantages includethe respondent being unwilling to respond giving inaccurate answers or unwilling to spend thetime to answer

3 Experimental research

involves the gathering of primary data by selectingmatched groups of subjects giving them different treatments controlling related factors andchecking for differences in-group responses This form of research tries to explain cause-andeffectrelationships Observation and surveys may be used to collect information in experimentalresearch This form is best used for causal information

In last Lesson we discussed the marketing research process first two steps were discussed in thatLesson today we will continue the same topic and will be discussing the remaining steps of themarketing research process Second topic of todayrsquos Lesson is an introduction to the consumer

behaviorSo our todayrsquos topics are

A THE MARKETING RESEARCH PROCESS (Continued)

B CONSUMER MARKET

Contact Methods

Contact methods are used to obtain the information Contact methods can be listed as1 Mail questionnaires--used to collect large amounts of information at a low cost2 Telephone interviewing--good method for collecting information quickly3 Personal interviewing (which can be either individual or group interviewing)A form of personal interviewing is ldquofocus group interviewingrdquoFocus-group interviewing consists of inviting six to ten people to gather for a few hours with atrained interviewer to talk about a product service or organization The interviewer ldquofocusesrdquothe group discussion on important issues4 Online (Internet) marketing research can consist of Internet surveys or online focus groupsMany experts predict that online research will soon be the primary tool of marketing researchers5 Computer interviewing is a new method being used in the technology age Consumers readquestions from a computer screen and respondSampling plans are used to outline how samples will be constructed and used1 A sample is a segment of the population selected for marketing research to represent thepopulation as a whole2 Marketing researchers usually draw conclusions about large groups of consumers bystudying a small sample of the total consumer population3 Designing a sample calls for three decisionsa Who is to be surveyed (what sampling unit)b How many people should be surveyed (what sample size)c How should the sample be chosen (what sampling procedure)4 Kinds of samples includea Probability samples--each population member has a known chance of beingincluded in the sample and researchers can calculate confidence limits for samplingerrorb Nonprobability samples--sampling error cannot be measuredResearch InstrumentsIn collecting primary data marketing researchers have a choice of two main researchinstrumentsmdashthe questionnaire and mechanical devices The questionnaire is by far the mostcommon instrument whether administered in person by phone or online Questionnaires are veryflexiblemdashthere are many ways to ask questions However they must be developed carefully andtested before they can be used on a large scale A carelessly prepared questionnaire usually containsseveral errors In preparing a questionnaire the marketing researcher must first decide what questions to askQuestionnaires frequently leave out questions that should be answered and include questions that

cannot be answered will not be answered or need not be answered Each question should bechecked to see that it contributes to the research objectivesThe form of each question can influence the response Marketing researchers distinguish betweenclosed-end questions and open-end questions Closed-end questions include all the possibleanswers and subjects make choices among them Examples include multiple-choice questions andscale questions Open-end questions allow respondents to answer in their own words Open-endquestions often reveal more than closed-end questions because respondents are not limited in theiranswers Open-end questions are especially useful in exploratory research when the researcher istrying to find out what people think but not measuring how many people think in a certain wayClosed-end questions on the other hand provide answers that are easier to interpret and tabulateResearchers should also use care in the wording and ordering of questions They should usesimple direct unbiased wording Questions should be arranged in a logical order The firstquestion should create interest if possible and difficult or personal questions should be asked lastso that respondents do not become defensiveAlthough questionnaires are the most common research instrument mechanical instruments alsoare used We discussed two mechanical instruments people meters and supermarket scannersearlier in the chapter Another group of mechanical devices measures subjects physical responses

Step 3 Implementing the Research Plan

The researcher next puts the marketing research plan into action This involves collectingprocessing and analyzing the information Data collection can be carried out by the companysmarketing research staff or by outside firms The company keeps more control over the collectionprocess and data quality by using its own staff However outside firms that specialize in datacollection often can do the job more quickly and at a lower costThe data collection phase of the marketing research process is generally the most expensive andthe most subject to error The researcher should watch fieldwork closely to make sure that the planis implemented correctly and to guard against problems with contacting respondents withrespondents who refuse to cooperate or who give biased or dishonest answers and withinterviewers who make mistakes or take shortcuts

Step 4 Interpreting and Reporting the Findings

The final step in the marketing research process is interpreting and reporting the findings Theresearchers should keep from overwhelming managers with numbers and fancy statisticaltechniques Researchers should present important findings that are useful in the major decisionsfaced by management Interpretation should not be left only to researchers Marketing managerswill also have important insights into the problems Interpretation is an important phase of themarketing process The best research is meaningless if the manager blindly accepts wronginterpretations from the researcherThe researcher must now interpret the findings draw conclusions and report them tomanagement The researcher should not try to overwhelm managers with numbers and fancystatistical techniques Rather the researcher should present important findings that are useful inthe major decisions faced by managementHowever interpretation should not be left only to the researchers They are often experts inresearch design and statistics but the marketing manager knows more about the problem and the

decisions that must be made

In many cases findings can be interpreted in different ways anddiscussions between researchers and managers will help point to the best interpretations Themanager will also want to check that the research project was carried out properly and that all thenecessary analysis was completed Or after seeing the findings the manager may have additionalquestions that can be answered through further sifting of the data Finally the manager is the onewho ultimately must decide what action the research suggests The researchers may even make thedata directly available to marketing managers so that they can perform new analyses and test newrelationships on their ownInterpretation is an important phase of the marketing process The best research is meaningless ifthe manager blindly accepts faulty interpretations from the researcher Similarly managers may bebiasedmdashthey might tend to accept research results that show what they expected and to rejectthose that they did not expect or hope for Thus managers and researchers must work togetherclosely when interpreting research results and both must share responsibility for the researchprocess and resulting decisions

RESEARCH DESIGN

Exploratory research and itrsquos methods

Exploratory research is conducted to clarify ambiguous problems Management may have discovered general problems but research is needed to gain better understanding of the dimensions of the problems Exploratory studies provide information to use in analyzing a situation but uncovering conclusive evidence to determine a particular course of action is not the purpose of exploratory research Usually exploratory research is conducted with the expectation that subsequent research will be required to provide conclusive evidence It is a serious mistake to rush into detailed surveys before less expensive and more readily available sources of information have been exhausted

In an organisation considering a program to help employees with childcare needs for example exploratory research with a small number of employees who have children might determine that many of them have spouses who also work and that these employees have positive reactions to the possibility of an on-site child-care program In such a case exploratory research helps to crystallize a problem and identify information needs for future research

Exploratory research methods

The quickest and the cheapest way to formulate a hypothesis in exploratory research is by using any of the four methods

Literature search

Experience survey

Focus group

Analysis of selected cases

Literature Search

This refers to ldquoreferring to a literature to develop a new hypothesisrdquo The literature referred are ndash trade journals professional journals market research finding publications statistical publications etc Example Suppose a problem is ldquoWhy are sales downrdquo This can quickly be analyzed with the help of published data which should indicate ldquowhether the problem is an ldquoindustry problemrdquo or a ldquofirm problemrdquo Three possibilities exist to formulate the hypothesis

The companyrsquos market share has declined but industryrsquos figures are normal

The industry is declining and hence the companyrsquos market share is also declining

The industryrsquos share is going up but the companyrsquos share is declining

If we accept the situation that our companyrsquos sales are down despite the market showing an upward trend then we need to analyse the marketing mix variables

Example 1 A TV manufacturing company feels that its market share is declining whereas the overall television industry is doing very well

Example 2 Due to a trade embargo imposed by a country textiles exports are down and hence sales of a company making garment for exports is on the decline

The above information may be used to pinpoint the reason for declining sales

Experience Survey

In experience surveys it is desirable to talk to persons who are well informed in the area being investigated These people may be company executives or persons outside the organisation Here no questionnaire is required The approach adopted in an experience survey should be highly unstructured so that the respondent can give divergent views Since the idea of using experience survey is to undertake problem formulation and not conclusion probability sample need not be used Those who cannot speak freely should be excluded from the sample

Examples

1) A group of housewives may be approached for their choice for a ldquoready to cook productrdquo

2) A publisher might want to find out the reason for poor circulation of newspaper introduced recently He might meet (a) Newspaper sellers (b) Public reading room (c) General public (d) Business community etc

These are experienced persons whose knowledge researcher can use

Focus Group

Another widely used technique in exploratory research is the focus group In a focus group a small number of individuals are brought together to study and talk about some topic of interest The discussion is co-ordinated by a moderator The group usually is of 8-12 persons While selecting these persons care has to be taken to see that they should have a common background and have similar experiences in buying This is required because there should not be a conflict among the group members on the common issues that are being discussed During the discussion future buying attitudes present buying opinion etc are gathered

Most of the companies conducting the focus groups first screen the candidates to determine who will compose the particular group Firms also take care to avoid groups in which some of the participants have their friends and relatives because this leads to a biased discussion Normally a number of such groups are constituted and the final conclusion of various groups are taken for formulating the hypothesis Therefore a key factor in focus group is to have similar groups Normally there are 4-5 groups Some of them may even have 6-8 groups The guiding criteria is to see whether the latter groups are generating additional ideas or repeating the same with respect to the subject under study When this shows a diminishing return from the group the discussions stopped The typical focus group lasts for 1-30 hours to 2 hours The moderator under the focus group has a key role His job is to guide the group to proceed in the right direction

Analysis of selected cases

Analysing a selected case sometimes gives an insight into the problem which is being researched Case histories of companies which have undergone a similar situation may be available These case studies are well suited to carry out exploratory research However the result of investigation of case histories arc always considered suggestive rather than conclusive In case of preference to ldquoready to eat foodrdquo many case histories may be available in the form of previous studies made by competitors We must carefully examine the already published case studies with regard to other variables such as price advertisement changes in the taste etc

II DESCRIPTIVE RESEARCH AND ITrsquoS METHODS

Descriptive research is used to obtain information concerning the current status of the phenomena to describe ldquowhat existsrdquo with respect to variables or conditions in a situation The methods involved range from the survey which describes the status quo the correlation study which investigates the relationship between variables to developmental studies which seek to determine changes over time

Descriptive Research Methods

1 Case Studies

Detailed analysis of a single (or limited number) of people or events Case studies are usually interesting because of the unusualness of the case The major problem with case studies is the problem of objectivity The person who is presenting the case usually has some theoretical orientation It is acceptable for a theoretical orientation to affect onersquos interpretation of events In a case study the theoretical orientation can also lead to the selection of the facts to include in the case It is not surprising that case studies often seem to provide very compelling evidence for a theory Case studies can therefore assist psychology by illustrating how a theory could be applied to a person or events and by assisting with the development of hypotheses for more systematic testing

2 Observational Research

Accounts of the natural behavior of individuals or groups in some setting Unless the observation is unobtrusive there may be some subject reactivity to being observed This often decreases with time a process called habituation Observers cannot usually observe all behaviors all of the time They may use a behavioral checklist and may also use time sampling or event sampling procedures It is important to assess observer bias by the use of interobserver reliability Observational research may also pose ethical problems These can arise when the behaviors being observed are not public behaviors and when the observer joins a group in order to observe the membersrsquo behavior ndash participant observation

3 Survey Research

Structured questions to assess peoples beliefs attitudes and self-reports of behavior If the researcher wishes to generalize the responses to a population it is important to have a representative sample Surveys that rely on self-selection (respond if you are interested) produce non-generalizable results Surveys also provide information for co relational research One can correlate responses to some questions (often demographic questions) with responses to other questions (often attitudes or reports of behavior) Survey question must be clear and unambiguous Even if the questions are unambiguous and non-leading people may display a social desirability bias and give positive or socially acceptable and desirable answers Survey methods include (1) the interview or face-to-face method which is generally viewed as the best method for obtaining a high rate of responses but is also very costly (2) phone surveys which are less expensive but have a higher non-response rate (which has probably increased with caller ID) and (3) written or mail surveys which are least expensive but have a very high non-response rate Follow-up messages can help increase the response rate

4 Archival Research

Analysis of pre-existing data or records Archival research often involves content analysis a qualitative analysis of material For example one would use content analysis to determine whether there had been an increase in the frequency with which women and minorities were mentioned in US history books between 1920 and 2000 Some archival research is quasi-experimental

III EXPERIMENTAL RESEARCH AND ITrsquoS STAGES

Science revolves around experiments and learning the best way of conducting an experiment is crucial to obtaining useful and valid results When scientists speak of experiments in the strictest sense of the word they mean a true experiment where the scientist controls all of the factors and conditions Real world observations and case studies should be referred to as observational research rather than experiments For example observing animals in the wild is not a true experiment because it does not isolate and manipulate an independent variable

THE BASIS OF CONDUCTING AN EXPERIMENT

With an experiment the researcher is trying to learn something new about the world an explanation of lsquowhyrsquo something happens The experiment must maintain internal and external validity or the results will be useless When designing an experiment a researcher must follow all of the steps of the scientific method from making sure that the hypothesis is valid and testable to using controls and statistical tests

Whilst all scientists use reasoning operationalization and the steps of the scientific process it is not always a conscious process Experience and practice mean that many scientists follow an instinctive process of conducting an experiment the lsquostreamlinedrsquo scientific process Following the basic steps will usually generate valid results but where experiments are complex and expensive it is always advisable to follow the rigorous scientific protocols

Conducting a experiment has a number of stages where the parameters and structure of the experiment are made clear Whilst it is rarely practical to follow each step strictly any aberrations must be justified whether they arise because of budget impracticality or ethics

STAGE ONE

After deciding upon a hypothesis and making predictions the first stage of conducting an experiment is to specify the sample groups These should be large enough to give a statistically viable study but small enough to be practical Ideally groups should be selected at random from a wide selection of the sample population This allows results to be generalized to the population as a whole In the physical sciences this is fairly easy but the biological and behavioral sciences are often limited by other factors

For example medical trials often cannot find random groups Such research often relies upon volunteers so it is difficult to apply any realistic randomization This is not a problem as long as the process is justified and the results are not applied to the population as a whole If a psychological researcher used volunteers who were male students aged between 18 and 24 the findings can only be generalized to that specific demographic group within society

STAGE TWO

The sample groups should be divided into a control group and a test group to reduce the possibility of confounding variables This again should be random and the assigning of subjects to groups should be blind or double blind This will reduce the chances of experimental error or bias when conducting an experiment

Ethics are often a barrier to this process because deliberately withholding treatment is not permitted Again any deviations from this process must be explained in the conclusion There is nothing wrong with compromising upon randomness where necessary as long as other scientists are aware of how and why the researcher selected groups on that basis

STAGE THREE

This stage of conducting an experiment involves determining the time scale and frequency of sampling to fit the type of experiment For example researchers studying the effectiveness of a cure for colds would take frequent samples over a period of days Researchers testing a cure for Parkinsonrsquos disease would use less frequent tests over a period of months or years

STAGE FOUR

The penultimate stage of the experiment involves performing the experiment according to the methods stipulated during the design phase The independent variable is manipulated generating a usable data set for the dependent variable

STAGE FIVE

The raw data from the results should be gathered and analyzed by statistical means This allows the researcher to establish if there is any relationship between the variables and accept or reject the null hypothesis

These steps are essential to providing excellent results Whilst many researchers do not want to become involved in the exact processes of inductive reasoning deductive reasoning and operationalization they all follow the basic steps of conducting an experiment This ensures that their results are valid

suggestions for survival under global competitive environment In brief the importancerelevance of MR is fast growing along with the globalization of business It is a must for survival and growth under globalization Current marketing scenario is different as compared to traditional one There is a new trend towards liberalization and globalization Markets (domestic as well as foreign) are becoming highly competition New companies and new products re entering in the markets Survival is difficult under the present marketing environment Here MR offers various services It is now a professional activity with new developments in regard to scopecoverage and techniques In brief MR has great relevance in the current marketing scenario in India as well as in all countries- developed and developing of the world MR has enormous capacity to help and guide marketing companies in regard to their marketing problems and challenges

FUNCTIONS OF MARKETING RESEARCHMR performs five basic functions These are Description evaluation explanation prediction and finally aid in decision-making These functions are related to the research project undertaken Usually every research study performs all the five functions explained below(1) Description MR provides data and gives informationdescription of customers who buy the product This includes information about their agesex education income and the amount of money that they are willing to spend on the product Description of the customers is useful in order to draw certain conclusions about the customers and their buying behavior Even marketing strategies can be decided as per the information available(2) Evaluation MR is useful for understanding the viewsreactions of the buyers This includes views of consumers on packaging advertisingsales promotion measures used A manufacturer gets these details as well as the information about his product in comparison with the products of his competitors This facilitates evaluation of the marketing policies For example how far the packaging of the product is attractive to consumers or superior as compared to packaging by competitors and so on(3) Explanation MR gives explanation to certain questions of a manufacturer It may be related to decline in sales retailers negative reaction or resistance of consumers in a particular marketing area MR enables a manufacturer to understand why sales are reducing (causes) or why the response of the retailers is negative or why consumers in a particular region are not willing to purchase a specific product Such explanation is important as it enables a manufacturer to adjust his marketing policies in order to rectify the prevailing unfavorable situation(4) Prediction MR conducts prediction function Such predictions may be related to consumers market environmentmarket competition possible socio-economic changes and so on This prediction function enables a manufacturer to understand how much people will spend on the specific product in the next year or the fashions that consumers may prefer in the next year In addition prediction about the possible turnover in the years to come is also possible through suitable marketing research studies In brief marketing research is useful for understanding the marketing environment likely to develop in future This facilitates proper adjustment in the marketing policies for the future period In this sense the prediction function is important even when all predictions made through research studies may not prove to be fully correct However the trend indicated can be used for appropriate policy decisions(5) Aid in Decision-making One more function of MR is to facilitate the process of decision-making in the marketing field MR guides the manufacturer as regards the manner in which he can make

effective advertising appeal or create incentive among his salesmendistributors It also gives him guidance as regards price fixation and sales promotion techniques that will be useful for the future period This function of marketing research is closely related to other functions that it performs These functions facilitate reasonably correct decision-making by marketing managers

They also suggest the practical utility of MR activities

MR functions provide feedback (information and guidance) to marketing managers and improve the quality of their decision-making This practice is certainly safer as compared to decision-making on the basis of past experience or intuition When reality is complex and many facts are not detectable intuition is not adequate for decision-making Similarly experience is useful but decisions on experience alone may not be accurate

Large companies and professional executives prefer to resort to marketing research than depending on experience This is because information available is based on real data and is more reliable dependable This facilitates correct decision-making Thus marketing executives should prefer decisions on the basis of information supplied through marketing research Such decisions are likely to be more accurate as they are based on actual market situation

In brief the basic function of MR is to support marketing decision-making process Marketing research does not provide ready-made decisions or exact solutions on all marketing problems It only provides the clues or possible solutions that should be taken into consideration in the decision-making process It provides support to skills and abilities of marketing managers

The different functions of marketing research are supplementary in character These functions enable a manufacturer to keep close touch with the marketing situation and enable him to make suitable changes in his marketing policies and programmers They also suggest the role marketing research activity in modern competitive and consumer oriented marketing Marketing research functions certainly improve the quality of decision-making by marketing managers

ADVANTAGESIMPORTANCE OF MARKETING RESEARCH1 Indicates current market trends Marketing research keeps business unit in touch with the current market trends and offers guidance for facing market situation with confidence2 Pinpoints deficiencies in marketing policies MR pinpoints the deficiencies as regards products pricing promotion etc It gives guidance regarding different aspects of marketing They include product development branding packaging and advertising3 Explains customer resistance MR is useful for finding out customer resistance to companys products The researcher also suggests remedial measures to deal with the situation This makes the products and marketing policies agreeable to consumers4 Suggests sales promotion techniques MR enables a manufacturer to introduce appropriate sales promotion techniques select most convenient channel of distribution suitable pricing policy for the products and provision of discounts and concessions to dealers Marketing research facilitates sales promotion5 Offers guidance to marketing executives MR offers information and guidance to marketing

executives while framing marketing policies Continuous research enables a company to face adverse marketing situation boldly It acts as an insurance against possible changes in market environment6 Facilitates selection and training of sales force Marketing research is useful for the selection and training of staff in the sales organization It also suggests the incentives that should be offered for motivation of employees concerned with marketing7 Promotes business activities Marketing research enables a business unit to growexpand its activities It creates goodwill in the market and also enables a business unit to earn high profits through consumer-oriented marketing policies and programmers8 Facilitates appraisal of marketing policies Research activities enable business executives to have an appraisal of the present marketing policies in the light of findings of research work Suitable adjustments in the policies are also possible as per the suggestions made by the researchers9 Suggests new marketing opportunities MR suggests new marketing opportunities and the manner in which they can be exploited fully It identifies emerging market opportunities10 Facilitates inventory study Marketing research is useful for the evaluation of companyrsquos inventory policies and also for the introduction of more efficient ways of managing inventories including finished goods and raw materials11 Provides marketing information MR provides information on various aspects of marketing It suggests relative strengths and weaknesses of the company On the basis of such information marketing executives find it easy to frame policies for the future period MR provides information guidance and alternative solutions to current marketing problems12 Suggests appropriate distribution channels MR can be used to study the effectiveness of existing channels of distribution and the need of making suitable changes in the distribution system13 Provides information on product acceptance Marketing research helps in knowing the probability of acceptance of the product in its present form It is also useful for the introduction of modifications in the existing product line of a firm14 Creates progressive outlook MR generates a progressive and dynamic outlook throughout the business organization It promotes systematic thinking and a sense of professionalization within the company It also creates enthusiasm among marketing executives This brings success and stability to the whole business unit15 Has wider social significance MR is of paramount importance from the social angle It is the means by which the ultimate consumer literally becomes king of the market place with his desires prejudices and every whim transmitted to the producer and distributor In brief MR has wider social significance It is useful to all parties involved in the process of marketing

A marketing information system (MIS) is intended to bring together disparate items of data into a coherent body of information An MIS is as will shortly be seen more than raw data or information suitable for the purposes of decision making An MIS also provides methods for interpreting the information the MIS provides Moreover as Kotlers1 definition says an MIS is more than a system of data collection or a set of information technologies

A marketing information system is a continuing and interacting structure of people equipment and procedures to gather sort analyse evaluate and distribute pertinent timely and accurate information for use by marketing decision makers to improve their marketing planning implementation and control

Figure 91 illustrates the major components of an MIS the environmental factors monitored by the system and the types of marketing decision which the MIS seeks to underpin

Figure 91 The marketing information systems and its subsystems

The explanation of this model of an MIS begins with a description of each of its four main constituent parts the internal reporting systems marketing research system marketing intelligence system and marketing models It is suggested that whilst the MIS varies in its degree of sophistication - with many in the industrialised countries being computerised and few in the developing countries being so - a fully fledged MIS should have these components the methods (and technologies) of collection storing retrieving and processing data notwithstanding

Internal reporting systems All enterprises which have been in operation for any period of time nave a wealth of information However this information often remains under-utilised because it is compartmentalised either in the form of an individual entrepreneur or in the functional departments of larger businesses That is information is usually categorised according to its nature so that there are for example financial production manpower marketing stockholding and logistical data Often the entrepreneur or various personnel working in the functional departments holding these pieces of data do not see how it could help decision makers in other functional areas Similarly decision makers can fail to appreciate how information from other functional areas might help them and therefore do not request it

The internal records that are of immediate value to marketing decisions are orders received stockholdings and sales invoices These are but a few of the internal records that can be used by marketing managers but even this small set of records is capable of generating a great deal of information Below is a list of some of the information that can be derived from sales invoices

middot Product type size and pack type by territorymiddot Product type size and pack type by type of accountmiddot Product type size and pack type by industrymiddot Product type size and pack type by customermiddot Average value andor volume of sale by territorymiddot Average value andor volume of sale by type of accountmiddot Average value andor volume of sale by industrymiddot Average value andor volume of sale by sales person

By comparing orders received with invoices an enterprise can establish the extent to which it is providing an acceptable level of customer service In the same way comparing stockholding records with orders received helps an enterprise ascertain whether its stocks are in line with current demand patterns

Marketing research systems The general topic of marketing research has been the prime subject of the textbook and only a little more needs to be added here Marketing research is a proactive search for information That is the enterprise which commissions these studies does so to solve a perceived marketing problem In many cases data is collected in a purposeful way to address a well-defined problem (or a problem which can be defined and solved within the course of the study) The other form of marketing research centres not around a specific marketing problem but is an attempt to continuously monitor the marketing environment These monitoring or tracking exercises are continuous marketing research studies often involving panels of farmers consumers or distributors from which the same data is collected at regular intervals Whilst the ad hoc study and continuous marketing research differs in the orientation yet they are both proactive

Marketing intelligence systems Whereas marketing research is focused market intelligence is not A marketing intelligence system is a set of procedures and data sources used by marketing managers to sift information from the environment that they can use in their decision making This scanning of the economic and business environment can be undertaken in a variety of ways including2

Unfocused scanning

The manager by virtue of what heshe reads hears and watches exposes himherself to information that may prove useful Whilst the behaviour is unfocused and the manager has no specific purpose in mind it is not unintentional

Semi-focused scanning

Again the manager is not in search of particular pieces of information that heshe is actively searching but does narrow the range of media that is scanned For instance the manager may focus more on economic and business publications broadcasts etc and pay less attention to political scientific or technological media

Informal search

This describes the situation where a fairly limited and unstructured attempt is made to obtain information for a specific purpose For example the marketing manager of a firm considering entering the business of importing frozen fish from a neighbouring country may make informal inquiries as to prices and demand levels of frozen and fresh fish There would be little structure to this search with the manager making inquiries with traders heshe happens to encounter as well as with other ad hoc contacts in ministries international aid agencies with trade associations importersexporters etc

Formal search

This is a purposeful search after information in some systematic way The information will be required to address a specific issue Whilst this sort of activity may seem to share the characteristics of marketing research it is carried out by the manager himherself rather than a professional researcher Moreover the scope of the search is likely to be narrow in scope and far less intensive than marketing research

Marketing intelligence is the province of entrepreneurs and senior managers within an agribusiness It involves them in scanning newspaper trade magazines business journals and reports economic forecasts and other media In addition it involves management in talking to producers suppliers and customers as well as to competitors Nonetheless it is a largely informal process of observing and conversing

Some enterprises will approach marketing intelligence gathering in a more deliberate fashion and will train its sales force after-sales personnel and districtarea managers to take cognisance of competitors actions customer complaints and requests and distributor problems Enterprises with vision will also encourage intermediaries such as collectors retailers traders and other middlemen to be proactive in conveying market intelligence back to them

Marketing models Within the MIS there has to be the means of interpreting information in order to give direction to decision These models may be computerised or may not Typical tools are

middot Time series sales modesmiddot Brand switching modelsmiddot Linear programmingmiddot Elasticity models (price incomes demand supply etc)middot Regression and correlation modelsmiddot Analysis of Variance (ANOVA) modelsmiddot Sensitivity analysismiddot Discounted cash flowmiddot Spreadsheet what if models

These and similar mathematical statistical econometric and financial models are the analytical subsystem of the MIS A relatively modest investment in a desktop computer is enough to allow an enterprise to automate the analysis of its data Some of the models used are stochastic ie those containing a probabilistic element whereas others are deterministic models where chance plays no part Brand switching models are stochastic since these express brand choices in probabilities whereas linear programming is deterministic in that the relationships between variables are expressed in exact mathematical terms

THE MARKETING RESEARCH PROCESS

a Marketing Research an Introduction

Every marketer needs marketing research and most large companies have their own marketingresearch departments Marketing research involves a four-step process The first step consists ofthe manager and researcher carefully defining the problem and setting the research objectives Theobjective may be exploratory descriptive or causal The second step consists of developing the

research plan for collecting data from primary and secondary sources Primary data collection callsfor choosing a research approach (observation survey experiment) choosing a contact method(mail telephone personal) designing a sampling plan (whom to survey how many to survey andhow to choose them) and developing research instruments (questionnaire mechanical) The thirdstep consists of implementing the marketing research plan by collecting processing and analyzingthe information The fourth step consists of interpreting and reporting the findings Furtherinformation analysis helps marketing managers to apply the information and provides advancedstatistical procedures and models to develop more rigorous findings from the informationSome marketers face special marketing research considerations such as conducting research insmall-business non-profit or international situations Marketing research can be conductedeffectively by small organizations with small budgets International marketing researchers follow the same steps as domestic researchers but often face more challenging problems All organizations need to understand the major public policy and ethics issues surrounding marketing research

b Uses amp Application of Research in Marketing

Decision-making is crucial process in all types of the organization This decision-making requiresthen information that is collected and acquired through the marketing research process thisinformation can be regarding customers companies or competitor or the other environmentalfactors Major uses of the marketing research in the organizations are as following1048713 Measurement of market potential1048713 Analysis of market share1048713 Determination of market characteristics1048713 Sales analysis1048713 Product testing1048713 Forecasting1048713 Studies of business trends1048713 Studies of competitors products

c THE MARKETING RESEARCH PROCESS

Before researcher can provide managers with information they mustknow what kind of problem the manager wishes to solve Marketingresearch process has following steps1 Defining the problem and research objectives2 Developing the research plan3 Implementing the research plan and4 Interpreting and reporting the findings

Now we will discuss these steps in detail

Step 1 Defining the Problem and Research Objectives

The marketing manager and the researcher must work closely together to define the problemcarefully and agree on the research objectives Marketing managers must know enough aboutmarketing research to help in the planning and to interpret research results Defining the problemand research objectives is often the hardest step in the process After the problem has been definedcarefully the manager and researcher must set the research objectives The three general types ofobjectives are1) Exploratory research where the objective is to gather preliminary information thatwill help to better define problems and suggest hypotheses for their solution2) Descriptive research is where the intent is to describe things such as the marketpotential for a product or the demographics and attitudes of customers who buy the product3) Casual research is research to test hypotheses about cause-and-effect relationshipsThe statement of the problem and research objectives will guide the entire research process It isalways best to put the problem and research objectives statements in writing so agreement can bereached and everyone knows the direction of the research effort

Step 2 Developing the Research Plan

In developing the research plan the attempt is to determine the information needed (outlinesources of secondary data) develop a plan for gathering it efficiently and presenting the plan tomarketing management The plan spells out specific research approaches contact methodssampling plans and instruments that researchers will use to gather new data The firm shouldknow what data already exists before the process of collecting new data begins The steps thatshould be followed are Developing the research plan involves all of the following1 Determining Specific Information Needs2 Gathering Secondary Information3 Planning Primary Data Collection

1) Determine specific information needs

In this step research objectives are translatedinto specific information needs For example determine the demographic economic and lifestylecharacteristics of a target audience

2) Gathering secondary information

a) Secondary data is information that already exists somewhere having beencollected for another purpose Sources of secondary data include both internal and externalsources Companies can buy secondary data reports from outside suppliers (ie commercial datasources)Information can be obtained by using commercial online databases Examples includeCompuServe Dialog and Lexis-Nexus Many of these sources are free Advantages of secondarydata include1 It can usually be obtained more quickly and at a lower cost than primary data2 Sometimes data can be provided that an individual company could not collect on its own

Some problems with collecting secondary data include1 The needed information might not exist2 Even if the data is found it might not be useable3 The researcher must evaluate secondary information to make certain it is relevantaccurate current and impartial Secondary data is a good starting point however the company willoften have to collect primary datab) Primary data is information collected for the specific purpose at hand

Planning Primary Data Collection

A plan for primary data collection calls for a number ofdecisions on research approaches contact methods sampling plans and research instruments

Research Approaches

a) Research approaches can be listed as

1 Observational research

where information is gained by observing relevantpeople actions and situations However some things such as feelingsattitudes motives and private behavior cannot be observed Mechanicalobservation can be obtained through single source data systems This iswhere electronic monitoring systems link consumersrsquo exposure to televisionadvertising and promotion (measured using television meters) with what theybuy in stores (measured using store checkout scanners) Observationalresearch can be used to obtain information that people are unwilling orunable to provide

2 Survey research

is the gathering of primary data by asking people questionsabout their knowledge attitudes preferences and buying behavior Survey research is best suitedfor gathering descriptive information Survey research is the most widely used form of primarydata collection The major advantage of this approach is flexibility while the disadvantages includethe respondent being unwilling to respond giving inaccurate answers or unwilling to spend thetime to answer

3 Experimental research

involves the gathering of primary data by selectingmatched groups of subjects giving them different treatments controlling related factors andchecking for differences in-group responses This form of research tries to explain cause-andeffectrelationships Observation and surveys may be used to collect information in experimentalresearch This form is best used for causal information

In last Lesson we discussed the marketing research process first two steps were discussed in thatLesson today we will continue the same topic and will be discussing the remaining steps of themarketing research process Second topic of todayrsquos Lesson is an introduction to the consumer

behaviorSo our todayrsquos topics are

A THE MARKETING RESEARCH PROCESS (Continued)

B CONSUMER MARKET

Contact Methods

Contact methods are used to obtain the information Contact methods can be listed as1 Mail questionnaires--used to collect large amounts of information at a low cost2 Telephone interviewing--good method for collecting information quickly3 Personal interviewing (which can be either individual or group interviewing)A form of personal interviewing is ldquofocus group interviewingrdquoFocus-group interviewing consists of inviting six to ten people to gather for a few hours with atrained interviewer to talk about a product service or organization The interviewer ldquofocusesrdquothe group discussion on important issues4 Online (Internet) marketing research can consist of Internet surveys or online focus groupsMany experts predict that online research will soon be the primary tool of marketing researchers5 Computer interviewing is a new method being used in the technology age Consumers readquestions from a computer screen and respondSampling plans are used to outline how samples will be constructed and used1 A sample is a segment of the population selected for marketing research to represent thepopulation as a whole2 Marketing researchers usually draw conclusions about large groups of consumers bystudying a small sample of the total consumer population3 Designing a sample calls for three decisionsa Who is to be surveyed (what sampling unit)b How many people should be surveyed (what sample size)c How should the sample be chosen (what sampling procedure)4 Kinds of samples includea Probability samples--each population member has a known chance of beingincluded in the sample and researchers can calculate confidence limits for samplingerrorb Nonprobability samples--sampling error cannot be measuredResearch InstrumentsIn collecting primary data marketing researchers have a choice of two main researchinstrumentsmdashthe questionnaire and mechanical devices The questionnaire is by far the mostcommon instrument whether administered in person by phone or online Questionnaires are veryflexiblemdashthere are many ways to ask questions However they must be developed carefully andtested before they can be used on a large scale A carelessly prepared questionnaire usually containsseveral errors In preparing a questionnaire the marketing researcher must first decide what questions to askQuestionnaires frequently leave out questions that should be answered and include questions that

cannot be answered will not be answered or need not be answered Each question should bechecked to see that it contributes to the research objectivesThe form of each question can influence the response Marketing researchers distinguish betweenclosed-end questions and open-end questions Closed-end questions include all the possibleanswers and subjects make choices among them Examples include multiple-choice questions andscale questions Open-end questions allow respondents to answer in their own words Open-endquestions often reveal more than closed-end questions because respondents are not limited in theiranswers Open-end questions are especially useful in exploratory research when the researcher istrying to find out what people think but not measuring how many people think in a certain wayClosed-end questions on the other hand provide answers that are easier to interpret and tabulateResearchers should also use care in the wording and ordering of questions They should usesimple direct unbiased wording Questions should be arranged in a logical order The firstquestion should create interest if possible and difficult or personal questions should be asked lastso that respondents do not become defensiveAlthough questionnaires are the most common research instrument mechanical instruments alsoare used We discussed two mechanical instruments people meters and supermarket scannersearlier in the chapter Another group of mechanical devices measures subjects physical responses

Step 3 Implementing the Research Plan

The researcher next puts the marketing research plan into action This involves collectingprocessing and analyzing the information Data collection can be carried out by the companysmarketing research staff or by outside firms The company keeps more control over the collectionprocess and data quality by using its own staff However outside firms that specialize in datacollection often can do the job more quickly and at a lower costThe data collection phase of the marketing research process is generally the most expensive andthe most subject to error The researcher should watch fieldwork closely to make sure that the planis implemented correctly and to guard against problems with contacting respondents withrespondents who refuse to cooperate or who give biased or dishonest answers and withinterviewers who make mistakes or take shortcuts

Step 4 Interpreting and Reporting the Findings

The final step in the marketing research process is interpreting and reporting the findings Theresearchers should keep from overwhelming managers with numbers and fancy statisticaltechniques Researchers should present important findings that are useful in the major decisionsfaced by management Interpretation should not be left only to researchers Marketing managerswill also have important insights into the problems Interpretation is an important phase of themarketing process The best research is meaningless if the manager blindly accepts wronginterpretations from the researcherThe researcher must now interpret the findings draw conclusions and report them tomanagement The researcher should not try to overwhelm managers with numbers and fancystatistical techniques Rather the researcher should present important findings that are useful inthe major decisions faced by managementHowever interpretation should not be left only to the researchers They are often experts inresearch design and statistics but the marketing manager knows more about the problem and the

decisions that must be made

In many cases findings can be interpreted in different ways anddiscussions between researchers and managers will help point to the best interpretations Themanager will also want to check that the research project was carried out properly and that all thenecessary analysis was completed Or after seeing the findings the manager may have additionalquestions that can be answered through further sifting of the data Finally the manager is the onewho ultimately must decide what action the research suggests The researchers may even make thedata directly available to marketing managers so that they can perform new analyses and test newrelationships on their ownInterpretation is an important phase of the marketing process The best research is meaningless ifthe manager blindly accepts faulty interpretations from the researcher Similarly managers may bebiasedmdashthey might tend to accept research results that show what they expected and to rejectthose that they did not expect or hope for Thus managers and researchers must work togetherclosely when interpreting research results and both must share responsibility for the researchprocess and resulting decisions

RESEARCH DESIGN

Exploratory research and itrsquos methods

Exploratory research is conducted to clarify ambiguous problems Management may have discovered general problems but research is needed to gain better understanding of the dimensions of the problems Exploratory studies provide information to use in analyzing a situation but uncovering conclusive evidence to determine a particular course of action is not the purpose of exploratory research Usually exploratory research is conducted with the expectation that subsequent research will be required to provide conclusive evidence It is a serious mistake to rush into detailed surveys before less expensive and more readily available sources of information have been exhausted

In an organisation considering a program to help employees with childcare needs for example exploratory research with a small number of employees who have children might determine that many of them have spouses who also work and that these employees have positive reactions to the possibility of an on-site child-care program In such a case exploratory research helps to crystallize a problem and identify information needs for future research

Exploratory research methods

The quickest and the cheapest way to formulate a hypothesis in exploratory research is by using any of the four methods

Literature search

Experience survey

Focus group

Analysis of selected cases

Literature Search

This refers to ldquoreferring to a literature to develop a new hypothesisrdquo The literature referred are ndash trade journals professional journals market research finding publications statistical publications etc Example Suppose a problem is ldquoWhy are sales downrdquo This can quickly be analyzed with the help of published data which should indicate ldquowhether the problem is an ldquoindustry problemrdquo or a ldquofirm problemrdquo Three possibilities exist to formulate the hypothesis

The companyrsquos market share has declined but industryrsquos figures are normal

The industry is declining and hence the companyrsquos market share is also declining

The industryrsquos share is going up but the companyrsquos share is declining

If we accept the situation that our companyrsquos sales are down despite the market showing an upward trend then we need to analyse the marketing mix variables

Example 1 A TV manufacturing company feels that its market share is declining whereas the overall television industry is doing very well

Example 2 Due to a trade embargo imposed by a country textiles exports are down and hence sales of a company making garment for exports is on the decline

The above information may be used to pinpoint the reason for declining sales

Experience Survey

In experience surveys it is desirable to talk to persons who are well informed in the area being investigated These people may be company executives or persons outside the organisation Here no questionnaire is required The approach adopted in an experience survey should be highly unstructured so that the respondent can give divergent views Since the idea of using experience survey is to undertake problem formulation and not conclusion probability sample need not be used Those who cannot speak freely should be excluded from the sample

Examples

1) A group of housewives may be approached for their choice for a ldquoready to cook productrdquo

2) A publisher might want to find out the reason for poor circulation of newspaper introduced recently He might meet (a) Newspaper sellers (b) Public reading room (c) General public (d) Business community etc

These are experienced persons whose knowledge researcher can use

Focus Group

Another widely used technique in exploratory research is the focus group In a focus group a small number of individuals are brought together to study and talk about some topic of interest The discussion is co-ordinated by a moderator The group usually is of 8-12 persons While selecting these persons care has to be taken to see that they should have a common background and have similar experiences in buying This is required because there should not be a conflict among the group members on the common issues that are being discussed During the discussion future buying attitudes present buying opinion etc are gathered

Most of the companies conducting the focus groups first screen the candidates to determine who will compose the particular group Firms also take care to avoid groups in which some of the participants have their friends and relatives because this leads to a biased discussion Normally a number of such groups are constituted and the final conclusion of various groups are taken for formulating the hypothesis Therefore a key factor in focus group is to have similar groups Normally there are 4-5 groups Some of them may even have 6-8 groups The guiding criteria is to see whether the latter groups are generating additional ideas or repeating the same with respect to the subject under study When this shows a diminishing return from the group the discussions stopped The typical focus group lasts for 1-30 hours to 2 hours The moderator under the focus group has a key role His job is to guide the group to proceed in the right direction

Analysis of selected cases

Analysing a selected case sometimes gives an insight into the problem which is being researched Case histories of companies which have undergone a similar situation may be available These case studies are well suited to carry out exploratory research However the result of investigation of case histories arc always considered suggestive rather than conclusive In case of preference to ldquoready to eat foodrdquo many case histories may be available in the form of previous studies made by competitors We must carefully examine the already published case studies with regard to other variables such as price advertisement changes in the taste etc

II DESCRIPTIVE RESEARCH AND ITrsquoS METHODS

Descriptive research is used to obtain information concerning the current status of the phenomena to describe ldquowhat existsrdquo with respect to variables or conditions in a situation The methods involved range from the survey which describes the status quo the correlation study which investigates the relationship between variables to developmental studies which seek to determine changes over time

Descriptive Research Methods

1 Case Studies

Detailed analysis of a single (or limited number) of people or events Case studies are usually interesting because of the unusualness of the case The major problem with case studies is the problem of objectivity The person who is presenting the case usually has some theoretical orientation It is acceptable for a theoretical orientation to affect onersquos interpretation of events In a case study the theoretical orientation can also lead to the selection of the facts to include in the case It is not surprising that case studies often seem to provide very compelling evidence for a theory Case studies can therefore assist psychology by illustrating how a theory could be applied to a person or events and by assisting with the development of hypotheses for more systematic testing

2 Observational Research

Accounts of the natural behavior of individuals or groups in some setting Unless the observation is unobtrusive there may be some subject reactivity to being observed This often decreases with time a process called habituation Observers cannot usually observe all behaviors all of the time They may use a behavioral checklist and may also use time sampling or event sampling procedures It is important to assess observer bias by the use of interobserver reliability Observational research may also pose ethical problems These can arise when the behaviors being observed are not public behaviors and when the observer joins a group in order to observe the membersrsquo behavior ndash participant observation

3 Survey Research

Structured questions to assess peoples beliefs attitudes and self-reports of behavior If the researcher wishes to generalize the responses to a population it is important to have a representative sample Surveys that rely on self-selection (respond if you are interested) produce non-generalizable results Surveys also provide information for co relational research One can correlate responses to some questions (often demographic questions) with responses to other questions (often attitudes or reports of behavior) Survey question must be clear and unambiguous Even if the questions are unambiguous and non-leading people may display a social desirability bias and give positive or socially acceptable and desirable answers Survey methods include (1) the interview or face-to-face method which is generally viewed as the best method for obtaining a high rate of responses but is also very costly (2) phone surveys which are less expensive but have a higher non-response rate (which has probably increased with caller ID) and (3) written or mail surveys which are least expensive but have a very high non-response rate Follow-up messages can help increase the response rate

4 Archival Research

Analysis of pre-existing data or records Archival research often involves content analysis a qualitative analysis of material For example one would use content analysis to determine whether there had been an increase in the frequency with which women and minorities were mentioned in US history books between 1920 and 2000 Some archival research is quasi-experimental

III EXPERIMENTAL RESEARCH AND ITrsquoS STAGES

Science revolves around experiments and learning the best way of conducting an experiment is crucial to obtaining useful and valid results When scientists speak of experiments in the strictest sense of the word they mean a true experiment where the scientist controls all of the factors and conditions Real world observations and case studies should be referred to as observational research rather than experiments For example observing animals in the wild is not a true experiment because it does not isolate and manipulate an independent variable

THE BASIS OF CONDUCTING AN EXPERIMENT

With an experiment the researcher is trying to learn something new about the world an explanation of lsquowhyrsquo something happens The experiment must maintain internal and external validity or the results will be useless When designing an experiment a researcher must follow all of the steps of the scientific method from making sure that the hypothesis is valid and testable to using controls and statistical tests

Whilst all scientists use reasoning operationalization and the steps of the scientific process it is not always a conscious process Experience and practice mean that many scientists follow an instinctive process of conducting an experiment the lsquostreamlinedrsquo scientific process Following the basic steps will usually generate valid results but where experiments are complex and expensive it is always advisable to follow the rigorous scientific protocols

Conducting a experiment has a number of stages where the parameters and structure of the experiment are made clear Whilst it is rarely practical to follow each step strictly any aberrations must be justified whether they arise because of budget impracticality or ethics

STAGE ONE

After deciding upon a hypothesis and making predictions the first stage of conducting an experiment is to specify the sample groups These should be large enough to give a statistically viable study but small enough to be practical Ideally groups should be selected at random from a wide selection of the sample population This allows results to be generalized to the population as a whole In the physical sciences this is fairly easy but the biological and behavioral sciences are often limited by other factors

For example medical trials often cannot find random groups Such research often relies upon volunteers so it is difficult to apply any realistic randomization This is not a problem as long as the process is justified and the results are not applied to the population as a whole If a psychological researcher used volunteers who were male students aged between 18 and 24 the findings can only be generalized to that specific demographic group within society

STAGE TWO

The sample groups should be divided into a control group and a test group to reduce the possibility of confounding variables This again should be random and the assigning of subjects to groups should be blind or double blind This will reduce the chances of experimental error or bias when conducting an experiment

Ethics are often a barrier to this process because deliberately withholding treatment is not permitted Again any deviations from this process must be explained in the conclusion There is nothing wrong with compromising upon randomness where necessary as long as other scientists are aware of how and why the researcher selected groups on that basis

STAGE THREE

This stage of conducting an experiment involves determining the time scale and frequency of sampling to fit the type of experiment For example researchers studying the effectiveness of a cure for colds would take frequent samples over a period of days Researchers testing a cure for Parkinsonrsquos disease would use less frequent tests over a period of months or years

STAGE FOUR

The penultimate stage of the experiment involves performing the experiment according to the methods stipulated during the design phase The independent variable is manipulated generating a usable data set for the dependent variable

STAGE FIVE

The raw data from the results should be gathered and analyzed by statistical means This allows the researcher to establish if there is any relationship between the variables and accept or reject the null hypothesis

These steps are essential to providing excellent results Whilst many researchers do not want to become involved in the exact processes of inductive reasoning deductive reasoning and operationalization they all follow the basic steps of conducting an experiment This ensures that their results are valid

effective advertising appeal or create incentive among his salesmendistributors It also gives him guidance as regards price fixation and sales promotion techniques that will be useful for the future period This function of marketing research is closely related to other functions that it performs These functions facilitate reasonably correct decision-making by marketing managers

They also suggest the practical utility of MR activities

MR functions provide feedback (information and guidance) to marketing managers and improve the quality of their decision-making This practice is certainly safer as compared to decision-making on the basis of past experience or intuition When reality is complex and many facts are not detectable intuition is not adequate for decision-making Similarly experience is useful but decisions on experience alone may not be accurate

Large companies and professional executives prefer to resort to marketing research than depending on experience This is because information available is based on real data and is more reliable dependable This facilitates correct decision-making Thus marketing executives should prefer decisions on the basis of information supplied through marketing research Such decisions are likely to be more accurate as they are based on actual market situation

In brief the basic function of MR is to support marketing decision-making process Marketing research does not provide ready-made decisions or exact solutions on all marketing problems It only provides the clues or possible solutions that should be taken into consideration in the decision-making process It provides support to skills and abilities of marketing managers

The different functions of marketing research are supplementary in character These functions enable a manufacturer to keep close touch with the marketing situation and enable him to make suitable changes in his marketing policies and programmers They also suggest the role marketing research activity in modern competitive and consumer oriented marketing Marketing research functions certainly improve the quality of decision-making by marketing managers

ADVANTAGESIMPORTANCE OF MARKETING RESEARCH1 Indicates current market trends Marketing research keeps business unit in touch with the current market trends and offers guidance for facing market situation with confidence2 Pinpoints deficiencies in marketing policies MR pinpoints the deficiencies as regards products pricing promotion etc It gives guidance regarding different aspects of marketing They include product development branding packaging and advertising3 Explains customer resistance MR is useful for finding out customer resistance to companys products The researcher also suggests remedial measures to deal with the situation This makes the products and marketing policies agreeable to consumers4 Suggests sales promotion techniques MR enables a manufacturer to introduce appropriate sales promotion techniques select most convenient channel of distribution suitable pricing policy for the products and provision of discounts and concessions to dealers Marketing research facilitates sales promotion5 Offers guidance to marketing executives MR offers information and guidance to marketing

executives while framing marketing policies Continuous research enables a company to face adverse marketing situation boldly It acts as an insurance against possible changes in market environment6 Facilitates selection and training of sales force Marketing research is useful for the selection and training of staff in the sales organization It also suggests the incentives that should be offered for motivation of employees concerned with marketing7 Promotes business activities Marketing research enables a business unit to growexpand its activities It creates goodwill in the market and also enables a business unit to earn high profits through consumer-oriented marketing policies and programmers8 Facilitates appraisal of marketing policies Research activities enable business executives to have an appraisal of the present marketing policies in the light of findings of research work Suitable adjustments in the policies are also possible as per the suggestions made by the researchers9 Suggests new marketing opportunities MR suggests new marketing opportunities and the manner in which they can be exploited fully It identifies emerging market opportunities10 Facilitates inventory study Marketing research is useful for the evaluation of companyrsquos inventory policies and also for the introduction of more efficient ways of managing inventories including finished goods and raw materials11 Provides marketing information MR provides information on various aspects of marketing It suggests relative strengths and weaknesses of the company On the basis of such information marketing executives find it easy to frame policies for the future period MR provides information guidance and alternative solutions to current marketing problems12 Suggests appropriate distribution channels MR can be used to study the effectiveness of existing channels of distribution and the need of making suitable changes in the distribution system13 Provides information on product acceptance Marketing research helps in knowing the probability of acceptance of the product in its present form It is also useful for the introduction of modifications in the existing product line of a firm14 Creates progressive outlook MR generates a progressive and dynamic outlook throughout the business organization It promotes systematic thinking and a sense of professionalization within the company It also creates enthusiasm among marketing executives This brings success and stability to the whole business unit15 Has wider social significance MR is of paramount importance from the social angle It is the means by which the ultimate consumer literally becomes king of the market place with his desires prejudices and every whim transmitted to the producer and distributor In brief MR has wider social significance It is useful to all parties involved in the process of marketing

A marketing information system (MIS) is intended to bring together disparate items of data into a coherent body of information An MIS is as will shortly be seen more than raw data or information suitable for the purposes of decision making An MIS also provides methods for interpreting the information the MIS provides Moreover as Kotlers1 definition says an MIS is more than a system of data collection or a set of information technologies

A marketing information system is a continuing and interacting structure of people equipment and procedures to gather sort analyse evaluate and distribute pertinent timely and accurate information for use by marketing decision makers to improve their marketing planning implementation and control

Figure 91 illustrates the major components of an MIS the environmental factors monitored by the system and the types of marketing decision which the MIS seeks to underpin

Figure 91 The marketing information systems and its subsystems

The explanation of this model of an MIS begins with a description of each of its four main constituent parts the internal reporting systems marketing research system marketing intelligence system and marketing models It is suggested that whilst the MIS varies in its degree of sophistication - with many in the industrialised countries being computerised and few in the developing countries being so - a fully fledged MIS should have these components the methods (and technologies) of collection storing retrieving and processing data notwithstanding

Internal reporting systems All enterprises which have been in operation for any period of time nave a wealth of information However this information often remains under-utilised because it is compartmentalised either in the form of an individual entrepreneur or in the functional departments of larger businesses That is information is usually categorised according to its nature so that there are for example financial production manpower marketing stockholding and logistical data Often the entrepreneur or various personnel working in the functional departments holding these pieces of data do not see how it could help decision makers in other functional areas Similarly decision makers can fail to appreciate how information from other functional areas might help them and therefore do not request it

The internal records that are of immediate value to marketing decisions are orders received stockholdings and sales invoices These are but a few of the internal records that can be used by marketing managers but even this small set of records is capable of generating a great deal of information Below is a list of some of the information that can be derived from sales invoices

middot Product type size and pack type by territorymiddot Product type size and pack type by type of accountmiddot Product type size and pack type by industrymiddot Product type size and pack type by customermiddot Average value andor volume of sale by territorymiddot Average value andor volume of sale by type of accountmiddot Average value andor volume of sale by industrymiddot Average value andor volume of sale by sales person

By comparing orders received with invoices an enterprise can establish the extent to which it is providing an acceptable level of customer service In the same way comparing stockholding records with orders received helps an enterprise ascertain whether its stocks are in line with current demand patterns

Marketing research systems The general topic of marketing research has been the prime subject of the textbook and only a little more needs to be added here Marketing research is a proactive search for information That is the enterprise which commissions these studies does so to solve a perceived marketing problem In many cases data is collected in a purposeful way to address a well-defined problem (or a problem which can be defined and solved within the course of the study) The other form of marketing research centres not around a specific marketing problem but is an attempt to continuously monitor the marketing environment These monitoring or tracking exercises are continuous marketing research studies often involving panels of farmers consumers or distributors from which the same data is collected at regular intervals Whilst the ad hoc study and continuous marketing research differs in the orientation yet they are both proactive

Marketing intelligence systems Whereas marketing research is focused market intelligence is not A marketing intelligence system is a set of procedures and data sources used by marketing managers to sift information from the environment that they can use in their decision making This scanning of the economic and business environment can be undertaken in a variety of ways including2

Unfocused scanning

The manager by virtue of what heshe reads hears and watches exposes himherself to information that may prove useful Whilst the behaviour is unfocused and the manager has no specific purpose in mind it is not unintentional

Semi-focused scanning

Again the manager is not in search of particular pieces of information that heshe is actively searching but does narrow the range of media that is scanned For instance the manager may focus more on economic and business publications broadcasts etc and pay less attention to political scientific or technological media

Informal search

This describes the situation where a fairly limited and unstructured attempt is made to obtain information for a specific purpose For example the marketing manager of a firm considering entering the business of importing frozen fish from a neighbouring country may make informal inquiries as to prices and demand levels of frozen and fresh fish There would be little structure to this search with the manager making inquiries with traders heshe happens to encounter as well as with other ad hoc contacts in ministries international aid agencies with trade associations importersexporters etc

Formal search

This is a purposeful search after information in some systematic way The information will be required to address a specific issue Whilst this sort of activity may seem to share the characteristics of marketing research it is carried out by the manager himherself rather than a professional researcher Moreover the scope of the search is likely to be narrow in scope and far less intensive than marketing research

Marketing intelligence is the province of entrepreneurs and senior managers within an agribusiness It involves them in scanning newspaper trade magazines business journals and reports economic forecasts and other media In addition it involves management in talking to producers suppliers and customers as well as to competitors Nonetheless it is a largely informal process of observing and conversing

Some enterprises will approach marketing intelligence gathering in a more deliberate fashion and will train its sales force after-sales personnel and districtarea managers to take cognisance of competitors actions customer complaints and requests and distributor problems Enterprises with vision will also encourage intermediaries such as collectors retailers traders and other middlemen to be proactive in conveying market intelligence back to them

Marketing models Within the MIS there has to be the means of interpreting information in order to give direction to decision These models may be computerised or may not Typical tools are

middot Time series sales modesmiddot Brand switching modelsmiddot Linear programmingmiddot Elasticity models (price incomes demand supply etc)middot Regression and correlation modelsmiddot Analysis of Variance (ANOVA) modelsmiddot Sensitivity analysismiddot Discounted cash flowmiddot Spreadsheet what if models

These and similar mathematical statistical econometric and financial models are the analytical subsystem of the MIS A relatively modest investment in a desktop computer is enough to allow an enterprise to automate the analysis of its data Some of the models used are stochastic ie those containing a probabilistic element whereas others are deterministic models where chance plays no part Brand switching models are stochastic since these express brand choices in probabilities whereas linear programming is deterministic in that the relationships between variables are expressed in exact mathematical terms

THE MARKETING RESEARCH PROCESS

a Marketing Research an Introduction

Every marketer needs marketing research and most large companies have their own marketingresearch departments Marketing research involves a four-step process The first step consists ofthe manager and researcher carefully defining the problem and setting the research objectives Theobjective may be exploratory descriptive or causal The second step consists of developing the

research plan for collecting data from primary and secondary sources Primary data collection callsfor choosing a research approach (observation survey experiment) choosing a contact method(mail telephone personal) designing a sampling plan (whom to survey how many to survey andhow to choose them) and developing research instruments (questionnaire mechanical) The thirdstep consists of implementing the marketing research plan by collecting processing and analyzingthe information The fourth step consists of interpreting and reporting the findings Furtherinformation analysis helps marketing managers to apply the information and provides advancedstatistical procedures and models to develop more rigorous findings from the informationSome marketers face special marketing research considerations such as conducting research insmall-business non-profit or international situations Marketing research can be conductedeffectively by small organizations with small budgets International marketing researchers follow the same steps as domestic researchers but often face more challenging problems All organizations need to understand the major public policy and ethics issues surrounding marketing research

b Uses amp Application of Research in Marketing

Decision-making is crucial process in all types of the organization This decision-making requiresthen information that is collected and acquired through the marketing research process thisinformation can be regarding customers companies or competitor or the other environmentalfactors Major uses of the marketing research in the organizations are as following1048713 Measurement of market potential1048713 Analysis of market share1048713 Determination of market characteristics1048713 Sales analysis1048713 Product testing1048713 Forecasting1048713 Studies of business trends1048713 Studies of competitors products

c THE MARKETING RESEARCH PROCESS

Before researcher can provide managers with information they mustknow what kind of problem the manager wishes to solve Marketingresearch process has following steps1 Defining the problem and research objectives2 Developing the research plan3 Implementing the research plan and4 Interpreting and reporting the findings

Now we will discuss these steps in detail

Step 1 Defining the Problem and Research Objectives

The marketing manager and the researcher must work closely together to define the problemcarefully and agree on the research objectives Marketing managers must know enough aboutmarketing research to help in the planning and to interpret research results Defining the problemand research objectives is often the hardest step in the process After the problem has been definedcarefully the manager and researcher must set the research objectives The three general types ofobjectives are1) Exploratory research where the objective is to gather preliminary information thatwill help to better define problems and suggest hypotheses for their solution2) Descriptive research is where the intent is to describe things such as the marketpotential for a product or the demographics and attitudes of customers who buy the product3) Casual research is research to test hypotheses about cause-and-effect relationshipsThe statement of the problem and research objectives will guide the entire research process It isalways best to put the problem and research objectives statements in writing so agreement can bereached and everyone knows the direction of the research effort

Step 2 Developing the Research Plan

In developing the research plan the attempt is to determine the information needed (outlinesources of secondary data) develop a plan for gathering it efficiently and presenting the plan tomarketing management The plan spells out specific research approaches contact methodssampling plans and instruments that researchers will use to gather new data The firm shouldknow what data already exists before the process of collecting new data begins The steps thatshould be followed are Developing the research plan involves all of the following1 Determining Specific Information Needs2 Gathering Secondary Information3 Planning Primary Data Collection

1) Determine specific information needs

In this step research objectives are translatedinto specific information needs For example determine the demographic economic and lifestylecharacteristics of a target audience

2) Gathering secondary information

a) Secondary data is information that already exists somewhere having beencollected for another purpose Sources of secondary data include both internal and externalsources Companies can buy secondary data reports from outside suppliers (ie commercial datasources)Information can be obtained by using commercial online databases Examples includeCompuServe Dialog and Lexis-Nexus Many of these sources are free Advantages of secondarydata include1 It can usually be obtained more quickly and at a lower cost than primary data2 Sometimes data can be provided that an individual company could not collect on its own

Some problems with collecting secondary data include1 The needed information might not exist2 Even if the data is found it might not be useable3 The researcher must evaluate secondary information to make certain it is relevantaccurate current and impartial Secondary data is a good starting point however the company willoften have to collect primary datab) Primary data is information collected for the specific purpose at hand

Planning Primary Data Collection

A plan for primary data collection calls for a number ofdecisions on research approaches contact methods sampling plans and research instruments

Research Approaches

a) Research approaches can be listed as

1 Observational research

where information is gained by observing relevantpeople actions and situations However some things such as feelingsattitudes motives and private behavior cannot be observed Mechanicalobservation can be obtained through single source data systems This iswhere electronic monitoring systems link consumersrsquo exposure to televisionadvertising and promotion (measured using television meters) with what theybuy in stores (measured using store checkout scanners) Observationalresearch can be used to obtain information that people are unwilling orunable to provide

2 Survey research

is the gathering of primary data by asking people questionsabout their knowledge attitudes preferences and buying behavior Survey research is best suitedfor gathering descriptive information Survey research is the most widely used form of primarydata collection The major advantage of this approach is flexibility while the disadvantages includethe respondent being unwilling to respond giving inaccurate answers or unwilling to spend thetime to answer

3 Experimental research

involves the gathering of primary data by selectingmatched groups of subjects giving them different treatments controlling related factors andchecking for differences in-group responses This form of research tries to explain cause-andeffectrelationships Observation and surveys may be used to collect information in experimentalresearch This form is best used for causal information

In last Lesson we discussed the marketing research process first two steps were discussed in thatLesson today we will continue the same topic and will be discussing the remaining steps of themarketing research process Second topic of todayrsquos Lesson is an introduction to the consumer

behaviorSo our todayrsquos topics are

A THE MARKETING RESEARCH PROCESS (Continued)

B CONSUMER MARKET

Contact Methods

Contact methods are used to obtain the information Contact methods can be listed as1 Mail questionnaires--used to collect large amounts of information at a low cost2 Telephone interviewing--good method for collecting information quickly3 Personal interviewing (which can be either individual or group interviewing)A form of personal interviewing is ldquofocus group interviewingrdquoFocus-group interviewing consists of inviting six to ten people to gather for a few hours with atrained interviewer to talk about a product service or organization The interviewer ldquofocusesrdquothe group discussion on important issues4 Online (Internet) marketing research can consist of Internet surveys or online focus groupsMany experts predict that online research will soon be the primary tool of marketing researchers5 Computer interviewing is a new method being used in the technology age Consumers readquestions from a computer screen and respondSampling plans are used to outline how samples will be constructed and used1 A sample is a segment of the population selected for marketing research to represent thepopulation as a whole2 Marketing researchers usually draw conclusions about large groups of consumers bystudying a small sample of the total consumer population3 Designing a sample calls for three decisionsa Who is to be surveyed (what sampling unit)b How many people should be surveyed (what sample size)c How should the sample be chosen (what sampling procedure)4 Kinds of samples includea Probability samples--each population member has a known chance of beingincluded in the sample and researchers can calculate confidence limits for samplingerrorb Nonprobability samples--sampling error cannot be measuredResearch InstrumentsIn collecting primary data marketing researchers have a choice of two main researchinstrumentsmdashthe questionnaire and mechanical devices The questionnaire is by far the mostcommon instrument whether administered in person by phone or online Questionnaires are veryflexiblemdashthere are many ways to ask questions However they must be developed carefully andtested before they can be used on a large scale A carelessly prepared questionnaire usually containsseveral errors In preparing a questionnaire the marketing researcher must first decide what questions to askQuestionnaires frequently leave out questions that should be answered and include questions that

cannot be answered will not be answered or need not be answered Each question should bechecked to see that it contributes to the research objectivesThe form of each question can influence the response Marketing researchers distinguish betweenclosed-end questions and open-end questions Closed-end questions include all the possibleanswers and subjects make choices among them Examples include multiple-choice questions andscale questions Open-end questions allow respondents to answer in their own words Open-endquestions often reveal more than closed-end questions because respondents are not limited in theiranswers Open-end questions are especially useful in exploratory research when the researcher istrying to find out what people think but not measuring how many people think in a certain wayClosed-end questions on the other hand provide answers that are easier to interpret and tabulateResearchers should also use care in the wording and ordering of questions They should usesimple direct unbiased wording Questions should be arranged in a logical order The firstquestion should create interest if possible and difficult or personal questions should be asked lastso that respondents do not become defensiveAlthough questionnaires are the most common research instrument mechanical instruments alsoare used We discussed two mechanical instruments people meters and supermarket scannersearlier in the chapter Another group of mechanical devices measures subjects physical responses

Step 3 Implementing the Research Plan

The researcher next puts the marketing research plan into action This involves collectingprocessing and analyzing the information Data collection can be carried out by the companysmarketing research staff or by outside firms The company keeps more control over the collectionprocess and data quality by using its own staff However outside firms that specialize in datacollection often can do the job more quickly and at a lower costThe data collection phase of the marketing research process is generally the most expensive andthe most subject to error The researcher should watch fieldwork closely to make sure that the planis implemented correctly and to guard against problems with contacting respondents withrespondents who refuse to cooperate or who give biased or dishonest answers and withinterviewers who make mistakes or take shortcuts

Step 4 Interpreting and Reporting the Findings

The final step in the marketing research process is interpreting and reporting the findings Theresearchers should keep from overwhelming managers with numbers and fancy statisticaltechniques Researchers should present important findings that are useful in the major decisionsfaced by management Interpretation should not be left only to researchers Marketing managerswill also have important insights into the problems Interpretation is an important phase of themarketing process The best research is meaningless if the manager blindly accepts wronginterpretations from the researcherThe researcher must now interpret the findings draw conclusions and report them tomanagement The researcher should not try to overwhelm managers with numbers and fancystatistical techniques Rather the researcher should present important findings that are useful inthe major decisions faced by managementHowever interpretation should not be left only to the researchers They are often experts inresearch design and statistics but the marketing manager knows more about the problem and the

decisions that must be made

In many cases findings can be interpreted in different ways anddiscussions between researchers and managers will help point to the best interpretations Themanager will also want to check that the research project was carried out properly and that all thenecessary analysis was completed Or after seeing the findings the manager may have additionalquestions that can be answered through further sifting of the data Finally the manager is the onewho ultimately must decide what action the research suggests The researchers may even make thedata directly available to marketing managers so that they can perform new analyses and test newrelationships on their ownInterpretation is an important phase of the marketing process The best research is meaningless ifthe manager blindly accepts faulty interpretations from the researcher Similarly managers may bebiasedmdashthey might tend to accept research results that show what they expected and to rejectthose that they did not expect or hope for Thus managers and researchers must work togetherclosely when interpreting research results and both must share responsibility for the researchprocess and resulting decisions

RESEARCH DESIGN

Exploratory research and itrsquos methods

Exploratory research is conducted to clarify ambiguous problems Management may have discovered general problems but research is needed to gain better understanding of the dimensions of the problems Exploratory studies provide information to use in analyzing a situation but uncovering conclusive evidence to determine a particular course of action is not the purpose of exploratory research Usually exploratory research is conducted with the expectation that subsequent research will be required to provide conclusive evidence It is a serious mistake to rush into detailed surveys before less expensive and more readily available sources of information have been exhausted

In an organisation considering a program to help employees with childcare needs for example exploratory research with a small number of employees who have children might determine that many of them have spouses who also work and that these employees have positive reactions to the possibility of an on-site child-care program In such a case exploratory research helps to crystallize a problem and identify information needs for future research

Exploratory research methods

The quickest and the cheapest way to formulate a hypothesis in exploratory research is by using any of the four methods

Literature search

Experience survey

Focus group

Analysis of selected cases

Literature Search

This refers to ldquoreferring to a literature to develop a new hypothesisrdquo The literature referred are ndash trade journals professional journals market research finding publications statistical publications etc Example Suppose a problem is ldquoWhy are sales downrdquo This can quickly be analyzed with the help of published data which should indicate ldquowhether the problem is an ldquoindustry problemrdquo or a ldquofirm problemrdquo Three possibilities exist to formulate the hypothesis

The companyrsquos market share has declined but industryrsquos figures are normal

The industry is declining and hence the companyrsquos market share is also declining

The industryrsquos share is going up but the companyrsquos share is declining

If we accept the situation that our companyrsquos sales are down despite the market showing an upward trend then we need to analyse the marketing mix variables

Example 1 A TV manufacturing company feels that its market share is declining whereas the overall television industry is doing very well

Example 2 Due to a trade embargo imposed by a country textiles exports are down and hence sales of a company making garment for exports is on the decline

The above information may be used to pinpoint the reason for declining sales

Experience Survey

In experience surveys it is desirable to talk to persons who are well informed in the area being investigated These people may be company executives or persons outside the organisation Here no questionnaire is required The approach adopted in an experience survey should be highly unstructured so that the respondent can give divergent views Since the idea of using experience survey is to undertake problem formulation and not conclusion probability sample need not be used Those who cannot speak freely should be excluded from the sample

Examples

1) A group of housewives may be approached for their choice for a ldquoready to cook productrdquo

2) A publisher might want to find out the reason for poor circulation of newspaper introduced recently He might meet (a) Newspaper sellers (b) Public reading room (c) General public (d) Business community etc

These are experienced persons whose knowledge researcher can use

Focus Group

Another widely used technique in exploratory research is the focus group In a focus group a small number of individuals are brought together to study and talk about some topic of interest The discussion is co-ordinated by a moderator The group usually is of 8-12 persons While selecting these persons care has to be taken to see that they should have a common background and have similar experiences in buying This is required because there should not be a conflict among the group members on the common issues that are being discussed During the discussion future buying attitudes present buying opinion etc are gathered

Most of the companies conducting the focus groups first screen the candidates to determine who will compose the particular group Firms also take care to avoid groups in which some of the participants have their friends and relatives because this leads to a biased discussion Normally a number of such groups are constituted and the final conclusion of various groups are taken for formulating the hypothesis Therefore a key factor in focus group is to have similar groups Normally there are 4-5 groups Some of them may even have 6-8 groups The guiding criteria is to see whether the latter groups are generating additional ideas or repeating the same with respect to the subject under study When this shows a diminishing return from the group the discussions stopped The typical focus group lasts for 1-30 hours to 2 hours The moderator under the focus group has a key role His job is to guide the group to proceed in the right direction

Analysis of selected cases

Analysing a selected case sometimes gives an insight into the problem which is being researched Case histories of companies which have undergone a similar situation may be available These case studies are well suited to carry out exploratory research However the result of investigation of case histories arc always considered suggestive rather than conclusive In case of preference to ldquoready to eat foodrdquo many case histories may be available in the form of previous studies made by competitors We must carefully examine the already published case studies with regard to other variables such as price advertisement changes in the taste etc

II DESCRIPTIVE RESEARCH AND ITrsquoS METHODS

Descriptive research is used to obtain information concerning the current status of the phenomena to describe ldquowhat existsrdquo with respect to variables or conditions in a situation The methods involved range from the survey which describes the status quo the correlation study which investigates the relationship between variables to developmental studies which seek to determine changes over time

Descriptive Research Methods

1 Case Studies

Detailed analysis of a single (or limited number) of people or events Case studies are usually interesting because of the unusualness of the case The major problem with case studies is the problem of objectivity The person who is presenting the case usually has some theoretical orientation It is acceptable for a theoretical orientation to affect onersquos interpretation of events In a case study the theoretical orientation can also lead to the selection of the facts to include in the case It is not surprising that case studies often seem to provide very compelling evidence for a theory Case studies can therefore assist psychology by illustrating how a theory could be applied to a person or events and by assisting with the development of hypotheses for more systematic testing

2 Observational Research

Accounts of the natural behavior of individuals or groups in some setting Unless the observation is unobtrusive there may be some subject reactivity to being observed This often decreases with time a process called habituation Observers cannot usually observe all behaviors all of the time They may use a behavioral checklist and may also use time sampling or event sampling procedures It is important to assess observer bias by the use of interobserver reliability Observational research may also pose ethical problems These can arise when the behaviors being observed are not public behaviors and when the observer joins a group in order to observe the membersrsquo behavior ndash participant observation

3 Survey Research

Structured questions to assess peoples beliefs attitudes and self-reports of behavior If the researcher wishes to generalize the responses to a population it is important to have a representative sample Surveys that rely on self-selection (respond if you are interested) produce non-generalizable results Surveys also provide information for co relational research One can correlate responses to some questions (often demographic questions) with responses to other questions (often attitudes or reports of behavior) Survey question must be clear and unambiguous Even if the questions are unambiguous and non-leading people may display a social desirability bias and give positive or socially acceptable and desirable answers Survey methods include (1) the interview or face-to-face method which is generally viewed as the best method for obtaining a high rate of responses but is also very costly (2) phone surveys which are less expensive but have a higher non-response rate (which has probably increased with caller ID) and (3) written or mail surveys which are least expensive but have a very high non-response rate Follow-up messages can help increase the response rate

4 Archival Research

Analysis of pre-existing data or records Archival research often involves content analysis a qualitative analysis of material For example one would use content analysis to determine whether there had been an increase in the frequency with which women and minorities were mentioned in US history books between 1920 and 2000 Some archival research is quasi-experimental

III EXPERIMENTAL RESEARCH AND ITrsquoS STAGES

Science revolves around experiments and learning the best way of conducting an experiment is crucial to obtaining useful and valid results When scientists speak of experiments in the strictest sense of the word they mean a true experiment where the scientist controls all of the factors and conditions Real world observations and case studies should be referred to as observational research rather than experiments For example observing animals in the wild is not a true experiment because it does not isolate and manipulate an independent variable

THE BASIS OF CONDUCTING AN EXPERIMENT

With an experiment the researcher is trying to learn something new about the world an explanation of lsquowhyrsquo something happens The experiment must maintain internal and external validity or the results will be useless When designing an experiment a researcher must follow all of the steps of the scientific method from making sure that the hypothesis is valid and testable to using controls and statistical tests

Whilst all scientists use reasoning operationalization and the steps of the scientific process it is not always a conscious process Experience and practice mean that many scientists follow an instinctive process of conducting an experiment the lsquostreamlinedrsquo scientific process Following the basic steps will usually generate valid results but where experiments are complex and expensive it is always advisable to follow the rigorous scientific protocols

Conducting a experiment has a number of stages where the parameters and structure of the experiment are made clear Whilst it is rarely practical to follow each step strictly any aberrations must be justified whether they arise because of budget impracticality or ethics

STAGE ONE

After deciding upon a hypothesis and making predictions the first stage of conducting an experiment is to specify the sample groups These should be large enough to give a statistically viable study but small enough to be practical Ideally groups should be selected at random from a wide selection of the sample population This allows results to be generalized to the population as a whole In the physical sciences this is fairly easy but the biological and behavioral sciences are often limited by other factors

For example medical trials often cannot find random groups Such research often relies upon volunteers so it is difficult to apply any realistic randomization This is not a problem as long as the process is justified and the results are not applied to the population as a whole If a psychological researcher used volunteers who were male students aged between 18 and 24 the findings can only be generalized to that specific demographic group within society

STAGE TWO

The sample groups should be divided into a control group and a test group to reduce the possibility of confounding variables This again should be random and the assigning of subjects to groups should be blind or double blind This will reduce the chances of experimental error or bias when conducting an experiment

Ethics are often a barrier to this process because deliberately withholding treatment is not permitted Again any deviations from this process must be explained in the conclusion There is nothing wrong with compromising upon randomness where necessary as long as other scientists are aware of how and why the researcher selected groups on that basis

STAGE THREE

This stage of conducting an experiment involves determining the time scale and frequency of sampling to fit the type of experiment For example researchers studying the effectiveness of a cure for colds would take frequent samples over a period of days Researchers testing a cure for Parkinsonrsquos disease would use less frequent tests over a period of months or years

STAGE FOUR

The penultimate stage of the experiment involves performing the experiment according to the methods stipulated during the design phase The independent variable is manipulated generating a usable data set for the dependent variable

STAGE FIVE

The raw data from the results should be gathered and analyzed by statistical means This allows the researcher to establish if there is any relationship between the variables and accept or reject the null hypothesis

These steps are essential to providing excellent results Whilst many researchers do not want to become involved in the exact processes of inductive reasoning deductive reasoning and operationalization they all follow the basic steps of conducting an experiment This ensures that their results are valid

executives while framing marketing policies Continuous research enables a company to face adverse marketing situation boldly It acts as an insurance against possible changes in market environment6 Facilitates selection and training of sales force Marketing research is useful for the selection and training of staff in the sales organization It also suggests the incentives that should be offered for motivation of employees concerned with marketing7 Promotes business activities Marketing research enables a business unit to growexpand its activities It creates goodwill in the market and also enables a business unit to earn high profits through consumer-oriented marketing policies and programmers8 Facilitates appraisal of marketing policies Research activities enable business executives to have an appraisal of the present marketing policies in the light of findings of research work Suitable adjustments in the policies are also possible as per the suggestions made by the researchers9 Suggests new marketing opportunities MR suggests new marketing opportunities and the manner in which they can be exploited fully It identifies emerging market opportunities10 Facilitates inventory study Marketing research is useful for the evaluation of companyrsquos inventory policies and also for the introduction of more efficient ways of managing inventories including finished goods and raw materials11 Provides marketing information MR provides information on various aspects of marketing It suggests relative strengths and weaknesses of the company On the basis of such information marketing executives find it easy to frame policies for the future period MR provides information guidance and alternative solutions to current marketing problems12 Suggests appropriate distribution channels MR can be used to study the effectiveness of existing channels of distribution and the need of making suitable changes in the distribution system13 Provides information on product acceptance Marketing research helps in knowing the probability of acceptance of the product in its present form It is also useful for the introduction of modifications in the existing product line of a firm14 Creates progressive outlook MR generates a progressive and dynamic outlook throughout the business organization It promotes systematic thinking and a sense of professionalization within the company It also creates enthusiasm among marketing executives This brings success and stability to the whole business unit15 Has wider social significance MR is of paramount importance from the social angle It is the means by which the ultimate consumer literally becomes king of the market place with his desires prejudices and every whim transmitted to the producer and distributor In brief MR has wider social significance It is useful to all parties involved in the process of marketing

A marketing information system (MIS) is intended to bring together disparate items of data into a coherent body of information An MIS is as will shortly be seen more than raw data or information suitable for the purposes of decision making An MIS also provides methods for interpreting the information the MIS provides Moreover as Kotlers1 definition says an MIS is more than a system of data collection or a set of information technologies

A marketing information system is a continuing and interacting structure of people equipment and procedures to gather sort analyse evaluate and distribute pertinent timely and accurate information for use by marketing decision makers to improve their marketing planning implementation and control

Figure 91 illustrates the major components of an MIS the environmental factors monitored by the system and the types of marketing decision which the MIS seeks to underpin

Figure 91 The marketing information systems and its subsystems

The explanation of this model of an MIS begins with a description of each of its four main constituent parts the internal reporting systems marketing research system marketing intelligence system and marketing models It is suggested that whilst the MIS varies in its degree of sophistication - with many in the industrialised countries being computerised and few in the developing countries being so - a fully fledged MIS should have these components the methods (and technologies) of collection storing retrieving and processing data notwithstanding

Internal reporting systems All enterprises which have been in operation for any period of time nave a wealth of information However this information often remains under-utilised because it is compartmentalised either in the form of an individual entrepreneur or in the functional departments of larger businesses That is information is usually categorised according to its nature so that there are for example financial production manpower marketing stockholding and logistical data Often the entrepreneur or various personnel working in the functional departments holding these pieces of data do not see how it could help decision makers in other functional areas Similarly decision makers can fail to appreciate how information from other functional areas might help them and therefore do not request it

The internal records that are of immediate value to marketing decisions are orders received stockholdings and sales invoices These are but a few of the internal records that can be used by marketing managers but even this small set of records is capable of generating a great deal of information Below is a list of some of the information that can be derived from sales invoices

middot Product type size and pack type by territorymiddot Product type size and pack type by type of accountmiddot Product type size and pack type by industrymiddot Product type size and pack type by customermiddot Average value andor volume of sale by territorymiddot Average value andor volume of sale by type of accountmiddot Average value andor volume of sale by industrymiddot Average value andor volume of sale by sales person

By comparing orders received with invoices an enterprise can establish the extent to which it is providing an acceptable level of customer service In the same way comparing stockholding records with orders received helps an enterprise ascertain whether its stocks are in line with current demand patterns

Marketing research systems The general topic of marketing research has been the prime subject of the textbook and only a little more needs to be added here Marketing research is a proactive search for information That is the enterprise which commissions these studies does so to solve a perceived marketing problem In many cases data is collected in a purposeful way to address a well-defined problem (or a problem which can be defined and solved within the course of the study) The other form of marketing research centres not around a specific marketing problem but is an attempt to continuously monitor the marketing environment These monitoring or tracking exercises are continuous marketing research studies often involving panels of farmers consumers or distributors from which the same data is collected at regular intervals Whilst the ad hoc study and continuous marketing research differs in the orientation yet they are both proactive

Marketing intelligence systems Whereas marketing research is focused market intelligence is not A marketing intelligence system is a set of procedures and data sources used by marketing managers to sift information from the environment that they can use in their decision making This scanning of the economic and business environment can be undertaken in a variety of ways including2

Unfocused scanning

The manager by virtue of what heshe reads hears and watches exposes himherself to information that may prove useful Whilst the behaviour is unfocused and the manager has no specific purpose in mind it is not unintentional

Semi-focused scanning

Again the manager is not in search of particular pieces of information that heshe is actively searching but does narrow the range of media that is scanned For instance the manager may focus more on economic and business publications broadcasts etc and pay less attention to political scientific or technological media

Informal search

This describes the situation where a fairly limited and unstructured attempt is made to obtain information for a specific purpose For example the marketing manager of a firm considering entering the business of importing frozen fish from a neighbouring country may make informal inquiries as to prices and demand levels of frozen and fresh fish There would be little structure to this search with the manager making inquiries with traders heshe happens to encounter as well as with other ad hoc contacts in ministries international aid agencies with trade associations importersexporters etc

Formal search

This is a purposeful search after information in some systematic way The information will be required to address a specific issue Whilst this sort of activity may seem to share the characteristics of marketing research it is carried out by the manager himherself rather than a professional researcher Moreover the scope of the search is likely to be narrow in scope and far less intensive than marketing research

Marketing intelligence is the province of entrepreneurs and senior managers within an agribusiness It involves them in scanning newspaper trade magazines business journals and reports economic forecasts and other media In addition it involves management in talking to producers suppliers and customers as well as to competitors Nonetheless it is a largely informal process of observing and conversing

Some enterprises will approach marketing intelligence gathering in a more deliberate fashion and will train its sales force after-sales personnel and districtarea managers to take cognisance of competitors actions customer complaints and requests and distributor problems Enterprises with vision will also encourage intermediaries such as collectors retailers traders and other middlemen to be proactive in conveying market intelligence back to them

Marketing models Within the MIS there has to be the means of interpreting information in order to give direction to decision These models may be computerised or may not Typical tools are

middot Time series sales modesmiddot Brand switching modelsmiddot Linear programmingmiddot Elasticity models (price incomes demand supply etc)middot Regression and correlation modelsmiddot Analysis of Variance (ANOVA) modelsmiddot Sensitivity analysismiddot Discounted cash flowmiddot Spreadsheet what if models

These and similar mathematical statistical econometric and financial models are the analytical subsystem of the MIS A relatively modest investment in a desktop computer is enough to allow an enterprise to automate the analysis of its data Some of the models used are stochastic ie those containing a probabilistic element whereas others are deterministic models where chance plays no part Brand switching models are stochastic since these express brand choices in probabilities whereas linear programming is deterministic in that the relationships between variables are expressed in exact mathematical terms

THE MARKETING RESEARCH PROCESS

a Marketing Research an Introduction

Every marketer needs marketing research and most large companies have their own marketingresearch departments Marketing research involves a four-step process The first step consists ofthe manager and researcher carefully defining the problem and setting the research objectives Theobjective may be exploratory descriptive or causal The second step consists of developing the

research plan for collecting data from primary and secondary sources Primary data collection callsfor choosing a research approach (observation survey experiment) choosing a contact method(mail telephone personal) designing a sampling plan (whom to survey how many to survey andhow to choose them) and developing research instruments (questionnaire mechanical) The thirdstep consists of implementing the marketing research plan by collecting processing and analyzingthe information The fourth step consists of interpreting and reporting the findings Furtherinformation analysis helps marketing managers to apply the information and provides advancedstatistical procedures and models to develop more rigorous findings from the informationSome marketers face special marketing research considerations such as conducting research insmall-business non-profit or international situations Marketing research can be conductedeffectively by small organizations with small budgets International marketing researchers follow the same steps as domestic researchers but often face more challenging problems All organizations need to understand the major public policy and ethics issues surrounding marketing research

b Uses amp Application of Research in Marketing

Decision-making is crucial process in all types of the organization This decision-making requiresthen information that is collected and acquired through the marketing research process thisinformation can be regarding customers companies or competitor or the other environmentalfactors Major uses of the marketing research in the organizations are as following1048713 Measurement of market potential1048713 Analysis of market share1048713 Determination of market characteristics1048713 Sales analysis1048713 Product testing1048713 Forecasting1048713 Studies of business trends1048713 Studies of competitors products

c THE MARKETING RESEARCH PROCESS

Before researcher can provide managers with information they mustknow what kind of problem the manager wishes to solve Marketingresearch process has following steps1 Defining the problem and research objectives2 Developing the research plan3 Implementing the research plan and4 Interpreting and reporting the findings

Now we will discuss these steps in detail

Step 1 Defining the Problem and Research Objectives

The marketing manager and the researcher must work closely together to define the problemcarefully and agree on the research objectives Marketing managers must know enough aboutmarketing research to help in the planning and to interpret research results Defining the problemand research objectives is often the hardest step in the process After the problem has been definedcarefully the manager and researcher must set the research objectives The three general types ofobjectives are1) Exploratory research where the objective is to gather preliminary information thatwill help to better define problems and suggest hypotheses for their solution2) Descriptive research is where the intent is to describe things such as the marketpotential for a product or the demographics and attitudes of customers who buy the product3) Casual research is research to test hypotheses about cause-and-effect relationshipsThe statement of the problem and research objectives will guide the entire research process It isalways best to put the problem and research objectives statements in writing so agreement can bereached and everyone knows the direction of the research effort

Step 2 Developing the Research Plan

In developing the research plan the attempt is to determine the information needed (outlinesources of secondary data) develop a plan for gathering it efficiently and presenting the plan tomarketing management The plan spells out specific research approaches contact methodssampling plans and instruments that researchers will use to gather new data The firm shouldknow what data already exists before the process of collecting new data begins The steps thatshould be followed are Developing the research plan involves all of the following1 Determining Specific Information Needs2 Gathering Secondary Information3 Planning Primary Data Collection

1) Determine specific information needs

In this step research objectives are translatedinto specific information needs For example determine the demographic economic and lifestylecharacteristics of a target audience

2) Gathering secondary information

a) Secondary data is information that already exists somewhere having beencollected for another purpose Sources of secondary data include both internal and externalsources Companies can buy secondary data reports from outside suppliers (ie commercial datasources)Information can be obtained by using commercial online databases Examples includeCompuServe Dialog and Lexis-Nexus Many of these sources are free Advantages of secondarydata include1 It can usually be obtained more quickly and at a lower cost than primary data2 Sometimes data can be provided that an individual company could not collect on its own

Some problems with collecting secondary data include1 The needed information might not exist2 Even if the data is found it might not be useable3 The researcher must evaluate secondary information to make certain it is relevantaccurate current and impartial Secondary data is a good starting point however the company willoften have to collect primary datab) Primary data is information collected for the specific purpose at hand

Planning Primary Data Collection

A plan for primary data collection calls for a number ofdecisions on research approaches contact methods sampling plans and research instruments

Research Approaches

a) Research approaches can be listed as

1 Observational research

where information is gained by observing relevantpeople actions and situations However some things such as feelingsattitudes motives and private behavior cannot be observed Mechanicalobservation can be obtained through single source data systems This iswhere electronic monitoring systems link consumersrsquo exposure to televisionadvertising and promotion (measured using television meters) with what theybuy in stores (measured using store checkout scanners) Observationalresearch can be used to obtain information that people are unwilling orunable to provide

2 Survey research

is the gathering of primary data by asking people questionsabout their knowledge attitudes preferences and buying behavior Survey research is best suitedfor gathering descriptive information Survey research is the most widely used form of primarydata collection The major advantage of this approach is flexibility while the disadvantages includethe respondent being unwilling to respond giving inaccurate answers or unwilling to spend thetime to answer

3 Experimental research

involves the gathering of primary data by selectingmatched groups of subjects giving them different treatments controlling related factors andchecking for differences in-group responses This form of research tries to explain cause-andeffectrelationships Observation and surveys may be used to collect information in experimentalresearch This form is best used for causal information

In last Lesson we discussed the marketing research process first two steps were discussed in thatLesson today we will continue the same topic and will be discussing the remaining steps of themarketing research process Second topic of todayrsquos Lesson is an introduction to the consumer

behaviorSo our todayrsquos topics are

A THE MARKETING RESEARCH PROCESS (Continued)

B CONSUMER MARKET

Contact Methods

Contact methods are used to obtain the information Contact methods can be listed as1 Mail questionnaires--used to collect large amounts of information at a low cost2 Telephone interviewing--good method for collecting information quickly3 Personal interviewing (which can be either individual or group interviewing)A form of personal interviewing is ldquofocus group interviewingrdquoFocus-group interviewing consists of inviting six to ten people to gather for a few hours with atrained interviewer to talk about a product service or organization The interviewer ldquofocusesrdquothe group discussion on important issues4 Online (Internet) marketing research can consist of Internet surveys or online focus groupsMany experts predict that online research will soon be the primary tool of marketing researchers5 Computer interviewing is a new method being used in the technology age Consumers readquestions from a computer screen and respondSampling plans are used to outline how samples will be constructed and used1 A sample is a segment of the population selected for marketing research to represent thepopulation as a whole2 Marketing researchers usually draw conclusions about large groups of consumers bystudying a small sample of the total consumer population3 Designing a sample calls for three decisionsa Who is to be surveyed (what sampling unit)b How many people should be surveyed (what sample size)c How should the sample be chosen (what sampling procedure)4 Kinds of samples includea Probability samples--each population member has a known chance of beingincluded in the sample and researchers can calculate confidence limits for samplingerrorb Nonprobability samples--sampling error cannot be measuredResearch InstrumentsIn collecting primary data marketing researchers have a choice of two main researchinstrumentsmdashthe questionnaire and mechanical devices The questionnaire is by far the mostcommon instrument whether administered in person by phone or online Questionnaires are veryflexiblemdashthere are many ways to ask questions However they must be developed carefully andtested before they can be used on a large scale A carelessly prepared questionnaire usually containsseveral errors In preparing a questionnaire the marketing researcher must first decide what questions to askQuestionnaires frequently leave out questions that should be answered and include questions that

cannot be answered will not be answered or need not be answered Each question should bechecked to see that it contributes to the research objectivesThe form of each question can influence the response Marketing researchers distinguish betweenclosed-end questions and open-end questions Closed-end questions include all the possibleanswers and subjects make choices among them Examples include multiple-choice questions andscale questions Open-end questions allow respondents to answer in their own words Open-endquestions often reveal more than closed-end questions because respondents are not limited in theiranswers Open-end questions are especially useful in exploratory research when the researcher istrying to find out what people think but not measuring how many people think in a certain wayClosed-end questions on the other hand provide answers that are easier to interpret and tabulateResearchers should also use care in the wording and ordering of questions They should usesimple direct unbiased wording Questions should be arranged in a logical order The firstquestion should create interest if possible and difficult or personal questions should be asked lastso that respondents do not become defensiveAlthough questionnaires are the most common research instrument mechanical instruments alsoare used We discussed two mechanical instruments people meters and supermarket scannersearlier in the chapter Another group of mechanical devices measures subjects physical responses

Step 3 Implementing the Research Plan

The researcher next puts the marketing research plan into action This involves collectingprocessing and analyzing the information Data collection can be carried out by the companysmarketing research staff or by outside firms The company keeps more control over the collectionprocess and data quality by using its own staff However outside firms that specialize in datacollection often can do the job more quickly and at a lower costThe data collection phase of the marketing research process is generally the most expensive andthe most subject to error The researcher should watch fieldwork closely to make sure that the planis implemented correctly and to guard against problems with contacting respondents withrespondents who refuse to cooperate or who give biased or dishonest answers and withinterviewers who make mistakes or take shortcuts

Step 4 Interpreting and Reporting the Findings

The final step in the marketing research process is interpreting and reporting the findings Theresearchers should keep from overwhelming managers with numbers and fancy statisticaltechniques Researchers should present important findings that are useful in the major decisionsfaced by management Interpretation should not be left only to researchers Marketing managerswill also have important insights into the problems Interpretation is an important phase of themarketing process The best research is meaningless if the manager blindly accepts wronginterpretations from the researcherThe researcher must now interpret the findings draw conclusions and report them tomanagement The researcher should not try to overwhelm managers with numbers and fancystatistical techniques Rather the researcher should present important findings that are useful inthe major decisions faced by managementHowever interpretation should not be left only to the researchers They are often experts inresearch design and statistics but the marketing manager knows more about the problem and the

decisions that must be made

In many cases findings can be interpreted in different ways anddiscussions between researchers and managers will help point to the best interpretations Themanager will also want to check that the research project was carried out properly and that all thenecessary analysis was completed Or after seeing the findings the manager may have additionalquestions that can be answered through further sifting of the data Finally the manager is the onewho ultimately must decide what action the research suggests The researchers may even make thedata directly available to marketing managers so that they can perform new analyses and test newrelationships on their ownInterpretation is an important phase of the marketing process The best research is meaningless ifthe manager blindly accepts faulty interpretations from the researcher Similarly managers may bebiasedmdashthey might tend to accept research results that show what they expected and to rejectthose that they did not expect or hope for Thus managers and researchers must work togetherclosely when interpreting research results and both must share responsibility for the researchprocess and resulting decisions

RESEARCH DESIGN

Exploratory research and itrsquos methods

Exploratory research is conducted to clarify ambiguous problems Management may have discovered general problems but research is needed to gain better understanding of the dimensions of the problems Exploratory studies provide information to use in analyzing a situation but uncovering conclusive evidence to determine a particular course of action is not the purpose of exploratory research Usually exploratory research is conducted with the expectation that subsequent research will be required to provide conclusive evidence It is a serious mistake to rush into detailed surveys before less expensive and more readily available sources of information have been exhausted

In an organisation considering a program to help employees with childcare needs for example exploratory research with a small number of employees who have children might determine that many of them have spouses who also work and that these employees have positive reactions to the possibility of an on-site child-care program In such a case exploratory research helps to crystallize a problem and identify information needs for future research

Exploratory research methods

The quickest and the cheapest way to formulate a hypothesis in exploratory research is by using any of the four methods

Literature search

Experience survey

Focus group

Analysis of selected cases

Literature Search

This refers to ldquoreferring to a literature to develop a new hypothesisrdquo The literature referred are ndash trade journals professional journals market research finding publications statistical publications etc Example Suppose a problem is ldquoWhy are sales downrdquo This can quickly be analyzed with the help of published data which should indicate ldquowhether the problem is an ldquoindustry problemrdquo or a ldquofirm problemrdquo Three possibilities exist to formulate the hypothesis

The companyrsquos market share has declined but industryrsquos figures are normal

The industry is declining and hence the companyrsquos market share is also declining

The industryrsquos share is going up but the companyrsquos share is declining

If we accept the situation that our companyrsquos sales are down despite the market showing an upward trend then we need to analyse the marketing mix variables

Example 1 A TV manufacturing company feels that its market share is declining whereas the overall television industry is doing very well

Example 2 Due to a trade embargo imposed by a country textiles exports are down and hence sales of a company making garment for exports is on the decline

The above information may be used to pinpoint the reason for declining sales

Experience Survey

In experience surveys it is desirable to talk to persons who are well informed in the area being investigated These people may be company executives or persons outside the organisation Here no questionnaire is required The approach adopted in an experience survey should be highly unstructured so that the respondent can give divergent views Since the idea of using experience survey is to undertake problem formulation and not conclusion probability sample need not be used Those who cannot speak freely should be excluded from the sample

Examples

1) A group of housewives may be approached for their choice for a ldquoready to cook productrdquo

2) A publisher might want to find out the reason for poor circulation of newspaper introduced recently He might meet (a) Newspaper sellers (b) Public reading room (c) General public (d) Business community etc

These are experienced persons whose knowledge researcher can use

Focus Group

Another widely used technique in exploratory research is the focus group In a focus group a small number of individuals are brought together to study and talk about some topic of interest The discussion is co-ordinated by a moderator The group usually is of 8-12 persons While selecting these persons care has to be taken to see that they should have a common background and have similar experiences in buying This is required because there should not be a conflict among the group members on the common issues that are being discussed During the discussion future buying attitudes present buying opinion etc are gathered

Most of the companies conducting the focus groups first screen the candidates to determine who will compose the particular group Firms also take care to avoid groups in which some of the participants have their friends and relatives because this leads to a biased discussion Normally a number of such groups are constituted and the final conclusion of various groups are taken for formulating the hypothesis Therefore a key factor in focus group is to have similar groups Normally there are 4-5 groups Some of them may even have 6-8 groups The guiding criteria is to see whether the latter groups are generating additional ideas or repeating the same with respect to the subject under study When this shows a diminishing return from the group the discussions stopped The typical focus group lasts for 1-30 hours to 2 hours The moderator under the focus group has a key role His job is to guide the group to proceed in the right direction

Analysis of selected cases

Analysing a selected case sometimes gives an insight into the problem which is being researched Case histories of companies which have undergone a similar situation may be available These case studies are well suited to carry out exploratory research However the result of investigation of case histories arc always considered suggestive rather than conclusive In case of preference to ldquoready to eat foodrdquo many case histories may be available in the form of previous studies made by competitors We must carefully examine the already published case studies with regard to other variables such as price advertisement changes in the taste etc

II DESCRIPTIVE RESEARCH AND ITrsquoS METHODS

Descriptive research is used to obtain information concerning the current status of the phenomena to describe ldquowhat existsrdquo with respect to variables or conditions in a situation The methods involved range from the survey which describes the status quo the correlation study which investigates the relationship between variables to developmental studies which seek to determine changes over time

Descriptive Research Methods

1 Case Studies

Detailed analysis of a single (or limited number) of people or events Case studies are usually interesting because of the unusualness of the case The major problem with case studies is the problem of objectivity The person who is presenting the case usually has some theoretical orientation It is acceptable for a theoretical orientation to affect onersquos interpretation of events In a case study the theoretical orientation can also lead to the selection of the facts to include in the case It is not surprising that case studies often seem to provide very compelling evidence for a theory Case studies can therefore assist psychology by illustrating how a theory could be applied to a person or events and by assisting with the development of hypotheses for more systematic testing

2 Observational Research

Accounts of the natural behavior of individuals or groups in some setting Unless the observation is unobtrusive there may be some subject reactivity to being observed This often decreases with time a process called habituation Observers cannot usually observe all behaviors all of the time They may use a behavioral checklist and may also use time sampling or event sampling procedures It is important to assess observer bias by the use of interobserver reliability Observational research may also pose ethical problems These can arise when the behaviors being observed are not public behaviors and when the observer joins a group in order to observe the membersrsquo behavior ndash participant observation

3 Survey Research

Structured questions to assess peoples beliefs attitudes and self-reports of behavior If the researcher wishes to generalize the responses to a population it is important to have a representative sample Surveys that rely on self-selection (respond if you are interested) produce non-generalizable results Surveys also provide information for co relational research One can correlate responses to some questions (often demographic questions) with responses to other questions (often attitudes or reports of behavior) Survey question must be clear and unambiguous Even if the questions are unambiguous and non-leading people may display a social desirability bias and give positive or socially acceptable and desirable answers Survey methods include (1) the interview or face-to-face method which is generally viewed as the best method for obtaining a high rate of responses but is also very costly (2) phone surveys which are less expensive but have a higher non-response rate (which has probably increased with caller ID) and (3) written or mail surveys which are least expensive but have a very high non-response rate Follow-up messages can help increase the response rate

4 Archival Research

Analysis of pre-existing data or records Archival research often involves content analysis a qualitative analysis of material For example one would use content analysis to determine whether there had been an increase in the frequency with which women and minorities were mentioned in US history books between 1920 and 2000 Some archival research is quasi-experimental

III EXPERIMENTAL RESEARCH AND ITrsquoS STAGES

Science revolves around experiments and learning the best way of conducting an experiment is crucial to obtaining useful and valid results When scientists speak of experiments in the strictest sense of the word they mean a true experiment where the scientist controls all of the factors and conditions Real world observations and case studies should be referred to as observational research rather than experiments For example observing animals in the wild is not a true experiment because it does not isolate and manipulate an independent variable

THE BASIS OF CONDUCTING AN EXPERIMENT

With an experiment the researcher is trying to learn something new about the world an explanation of lsquowhyrsquo something happens The experiment must maintain internal and external validity or the results will be useless When designing an experiment a researcher must follow all of the steps of the scientific method from making sure that the hypothesis is valid and testable to using controls and statistical tests

Whilst all scientists use reasoning operationalization and the steps of the scientific process it is not always a conscious process Experience and practice mean that many scientists follow an instinctive process of conducting an experiment the lsquostreamlinedrsquo scientific process Following the basic steps will usually generate valid results but where experiments are complex and expensive it is always advisable to follow the rigorous scientific protocols

Conducting a experiment has a number of stages where the parameters and structure of the experiment are made clear Whilst it is rarely practical to follow each step strictly any aberrations must be justified whether they arise because of budget impracticality or ethics

STAGE ONE

After deciding upon a hypothesis and making predictions the first stage of conducting an experiment is to specify the sample groups These should be large enough to give a statistically viable study but small enough to be practical Ideally groups should be selected at random from a wide selection of the sample population This allows results to be generalized to the population as a whole In the physical sciences this is fairly easy but the biological and behavioral sciences are often limited by other factors

For example medical trials often cannot find random groups Such research often relies upon volunteers so it is difficult to apply any realistic randomization This is not a problem as long as the process is justified and the results are not applied to the population as a whole If a psychological researcher used volunteers who were male students aged between 18 and 24 the findings can only be generalized to that specific demographic group within society

STAGE TWO

The sample groups should be divided into a control group and a test group to reduce the possibility of confounding variables This again should be random and the assigning of subjects to groups should be blind or double blind This will reduce the chances of experimental error or bias when conducting an experiment

Ethics are often a barrier to this process because deliberately withholding treatment is not permitted Again any deviations from this process must be explained in the conclusion There is nothing wrong with compromising upon randomness where necessary as long as other scientists are aware of how and why the researcher selected groups on that basis

STAGE THREE

This stage of conducting an experiment involves determining the time scale and frequency of sampling to fit the type of experiment For example researchers studying the effectiveness of a cure for colds would take frequent samples over a period of days Researchers testing a cure for Parkinsonrsquos disease would use less frequent tests over a period of months or years

STAGE FOUR

The penultimate stage of the experiment involves performing the experiment according to the methods stipulated during the design phase The independent variable is manipulated generating a usable data set for the dependent variable

STAGE FIVE

The raw data from the results should be gathered and analyzed by statistical means This allows the researcher to establish if there is any relationship between the variables and accept or reject the null hypothesis

These steps are essential to providing excellent results Whilst many researchers do not want to become involved in the exact processes of inductive reasoning deductive reasoning and operationalization they all follow the basic steps of conducting an experiment This ensures that their results are valid

A marketing information system is a continuing and interacting structure of people equipment and procedures to gather sort analyse evaluate and distribute pertinent timely and accurate information for use by marketing decision makers to improve their marketing planning implementation and control

Figure 91 illustrates the major components of an MIS the environmental factors monitored by the system and the types of marketing decision which the MIS seeks to underpin

Figure 91 The marketing information systems and its subsystems

The explanation of this model of an MIS begins with a description of each of its four main constituent parts the internal reporting systems marketing research system marketing intelligence system and marketing models It is suggested that whilst the MIS varies in its degree of sophistication - with many in the industrialised countries being computerised and few in the developing countries being so - a fully fledged MIS should have these components the methods (and technologies) of collection storing retrieving and processing data notwithstanding

Internal reporting systems All enterprises which have been in operation for any period of time nave a wealth of information However this information often remains under-utilised because it is compartmentalised either in the form of an individual entrepreneur or in the functional departments of larger businesses That is information is usually categorised according to its nature so that there are for example financial production manpower marketing stockholding and logistical data Often the entrepreneur or various personnel working in the functional departments holding these pieces of data do not see how it could help decision makers in other functional areas Similarly decision makers can fail to appreciate how information from other functional areas might help them and therefore do not request it

The internal records that are of immediate value to marketing decisions are orders received stockholdings and sales invoices These are but a few of the internal records that can be used by marketing managers but even this small set of records is capable of generating a great deal of information Below is a list of some of the information that can be derived from sales invoices

middot Product type size and pack type by territorymiddot Product type size and pack type by type of accountmiddot Product type size and pack type by industrymiddot Product type size and pack type by customermiddot Average value andor volume of sale by territorymiddot Average value andor volume of sale by type of accountmiddot Average value andor volume of sale by industrymiddot Average value andor volume of sale by sales person

By comparing orders received with invoices an enterprise can establish the extent to which it is providing an acceptable level of customer service In the same way comparing stockholding records with orders received helps an enterprise ascertain whether its stocks are in line with current demand patterns

Marketing research systems The general topic of marketing research has been the prime subject of the textbook and only a little more needs to be added here Marketing research is a proactive search for information That is the enterprise which commissions these studies does so to solve a perceived marketing problem In many cases data is collected in a purposeful way to address a well-defined problem (or a problem which can be defined and solved within the course of the study) The other form of marketing research centres not around a specific marketing problem but is an attempt to continuously monitor the marketing environment These monitoring or tracking exercises are continuous marketing research studies often involving panels of farmers consumers or distributors from which the same data is collected at regular intervals Whilst the ad hoc study and continuous marketing research differs in the orientation yet they are both proactive

Marketing intelligence systems Whereas marketing research is focused market intelligence is not A marketing intelligence system is a set of procedures and data sources used by marketing managers to sift information from the environment that they can use in their decision making This scanning of the economic and business environment can be undertaken in a variety of ways including2

Unfocused scanning

The manager by virtue of what heshe reads hears and watches exposes himherself to information that may prove useful Whilst the behaviour is unfocused and the manager has no specific purpose in mind it is not unintentional

Semi-focused scanning

Again the manager is not in search of particular pieces of information that heshe is actively searching but does narrow the range of media that is scanned For instance the manager may focus more on economic and business publications broadcasts etc and pay less attention to political scientific or technological media

Informal search

This describes the situation where a fairly limited and unstructured attempt is made to obtain information for a specific purpose For example the marketing manager of a firm considering entering the business of importing frozen fish from a neighbouring country may make informal inquiries as to prices and demand levels of frozen and fresh fish There would be little structure to this search with the manager making inquiries with traders heshe happens to encounter as well as with other ad hoc contacts in ministries international aid agencies with trade associations importersexporters etc

Formal search

This is a purposeful search after information in some systematic way The information will be required to address a specific issue Whilst this sort of activity may seem to share the characteristics of marketing research it is carried out by the manager himherself rather than a professional researcher Moreover the scope of the search is likely to be narrow in scope and far less intensive than marketing research

Marketing intelligence is the province of entrepreneurs and senior managers within an agribusiness It involves them in scanning newspaper trade magazines business journals and reports economic forecasts and other media In addition it involves management in talking to producers suppliers and customers as well as to competitors Nonetheless it is a largely informal process of observing and conversing

Some enterprises will approach marketing intelligence gathering in a more deliberate fashion and will train its sales force after-sales personnel and districtarea managers to take cognisance of competitors actions customer complaints and requests and distributor problems Enterprises with vision will also encourage intermediaries such as collectors retailers traders and other middlemen to be proactive in conveying market intelligence back to them

Marketing models Within the MIS there has to be the means of interpreting information in order to give direction to decision These models may be computerised or may not Typical tools are

middot Time series sales modesmiddot Brand switching modelsmiddot Linear programmingmiddot Elasticity models (price incomes demand supply etc)middot Regression and correlation modelsmiddot Analysis of Variance (ANOVA) modelsmiddot Sensitivity analysismiddot Discounted cash flowmiddot Spreadsheet what if models

These and similar mathematical statistical econometric and financial models are the analytical subsystem of the MIS A relatively modest investment in a desktop computer is enough to allow an enterprise to automate the analysis of its data Some of the models used are stochastic ie those containing a probabilistic element whereas others are deterministic models where chance plays no part Brand switching models are stochastic since these express brand choices in probabilities whereas linear programming is deterministic in that the relationships between variables are expressed in exact mathematical terms

THE MARKETING RESEARCH PROCESS

a Marketing Research an Introduction

Every marketer needs marketing research and most large companies have their own marketingresearch departments Marketing research involves a four-step process The first step consists ofthe manager and researcher carefully defining the problem and setting the research objectives Theobjective may be exploratory descriptive or causal The second step consists of developing the

research plan for collecting data from primary and secondary sources Primary data collection callsfor choosing a research approach (observation survey experiment) choosing a contact method(mail telephone personal) designing a sampling plan (whom to survey how many to survey andhow to choose them) and developing research instruments (questionnaire mechanical) The thirdstep consists of implementing the marketing research plan by collecting processing and analyzingthe information The fourth step consists of interpreting and reporting the findings Furtherinformation analysis helps marketing managers to apply the information and provides advancedstatistical procedures and models to develop more rigorous findings from the informationSome marketers face special marketing research considerations such as conducting research insmall-business non-profit or international situations Marketing research can be conductedeffectively by small organizations with small budgets International marketing researchers follow the same steps as domestic researchers but often face more challenging problems All organizations need to understand the major public policy and ethics issues surrounding marketing research

b Uses amp Application of Research in Marketing

Decision-making is crucial process in all types of the organization This decision-making requiresthen information that is collected and acquired through the marketing research process thisinformation can be regarding customers companies or competitor or the other environmentalfactors Major uses of the marketing research in the organizations are as following1048713 Measurement of market potential1048713 Analysis of market share1048713 Determination of market characteristics1048713 Sales analysis1048713 Product testing1048713 Forecasting1048713 Studies of business trends1048713 Studies of competitors products

c THE MARKETING RESEARCH PROCESS

Before researcher can provide managers with information they mustknow what kind of problem the manager wishes to solve Marketingresearch process has following steps1 Defining the problem and research objectives2 Developing the research plan3 Implementing the research plan and4 Interpreting and reporting the findings

Now we will discuss these steps in detail

Step 1 Defining the Problem and Research Objectives

The marketing manager and the researcher must work closely together to define the problemcarefully and agree on the research objectives Marketing managers must know enough aboutmarketing research to help in the planning and to interpret research results Defining the problemand research objectives is often the hardest step in the process After the problem has been definedcarefully the manager and researcher must set the research objectives The three general types ofobjectives are1) Exploratory research where the objective is to gather preliminary information thatwill help to better define problems and suggest hypotheses for their solution2) Descriptive research is where the intent is to describe things such as the marketpotential for a product or the demographics and attitudes of customers who buy the product3) Casual research is research to test hypotheses about cause-and-effect relationshipsThe statement of the problem and research objectives will guide the entire research process It isalways best to put the problem and research objectives statements in writing so agreement can bereached and everyone knows the direction of the research effort

Step 2 Developing the Research Plan

In developing the research plan the attempt is to determine the information needed (outlinesources of secondary data) develop a plan for gathering it efficiently and presenting the plan tomarketing management The plan spells out specific research approaches contact methodssampling plans and instruments that researchers will use to gather new data The firm shouldknow what data already exists before the process of collecting new data begins The steps thatshould be followed are Developing the research plan involves all of the following1 Determining Specific Information Needs2 Gathering Secondary Information3 Planning Primary Data Collection

1) Determine specific information needs

In this step research objectives are translatedinto specific information needs For example determine the demographic economic and lifestylecharacteristics of a target audience

2) Gathering secondary information

a) Secondary data is information that already exists somewhere having beencollected for another purpose Sources of secondary data include both internal and externalsources Companies can buy secondary data reports from outside suppliers (ie commercial datasources)Information can be obtained by using commercial online databases Examples includeCompuServe Dialog and Lexis-Nexus Many of these sources are free Advantages of secondarydata include1 It can usually be obtained more quickly and at a lower cost than primary data2 Sometimes data can be provided that an individual company could not collect on its own

Some problems with collecting secondary data include1 The needed information might not exist2 Even if the data is found it might not be useable3 The researcher must evaluate secondary information to make certain it is relevantaccurate current and impartial Secondary data is a good starting point however the company willoften have to collect primary datab) Primary data is information collected for the specific purpose at hand

Planning Primary Data Collection

A plan for primary data collection calls for a number ofdecisions on research approaches contact methods sampling plans and research instruments

Research Approaches

a) Research approaches can be listed as

1 Observational research

where information is gained by observing relevantpeople actions and situations However some things such as feelingsattitudes motives and private behavior cannot be observed Mechanicalobservation can be obtained through single source data systems This iswhere electronic monitoring systems link consumersrsquo exposure to televisionadvertising and promotion (measured using television meters) with what theybuy in stores (measured using store checkout scanners) Observationalresearch can be used to obtain information that people are unwilling orunable to provide

2 Survey research

is the gathering of primary data by asking people questionsabout their knowledge attitudes preferences and buying behavior Survey research is best suitedfor gathering descriptive information Survey research is the most widely used form of primarydata collection The major advantage of this approach is flexibility while the disadvantages includethe respondent being unwilling to respond giving inaccurate answers or unwilling to spend thetime to answer

3 Experimental research

involves the gathering of primary data by selectingmatched groups of subjects giving them different treatments controlling related factors andchecking for differences in-group responses This form of research tries to explain cause-andeffectrelationships Observation and surveys may be used to collect information in experimentalresearch This form is best used for causal information

In last Lesson we discussed the marketing research process first two steps were discussed in thatLesson today we will continue the same topic and will be discussing the remaining steps of themarketing research process Second topic of todayrsquos Lesson is an introduction to the consumer

behaviorSo our todayrsquos topics are

A THE MARKETING RESEARCH PROCESS (Continued)

B CONSUMER MARKET

Contact Methods

Contact methods are used to obtain the information Contact methods can be listed as1 Mail questionnaires--used to collect large amounts of information at a low cost2 Telephone interviewing--good method for collecting information quickly3 Personal interviewing (which can be either individual or group interviewing)A form of personal interviewing is ldquofocus group interviewingrdquoFocus-group interviewing consists of inviting six to ten people to gather for a few hours with atrained interviewer to talk about a product service or organization The interviewer ldquofocusesrdquothe group discussion on important issues4 Online (Internet) marketing research can consist of Internet surveys or online focus groupsMany experts predict that online research will soon be the primary tool of marketing researchers5 Computer interviewing is a new method being used in the technology age Consumers readquestions from a computer screen and respondSampling plans are used to outline how samples will be constructed and used1 A sample is a segment of the population selected for marketing research to represent thepopulation as a whole2 Marketing researchers usually draw conclusions about large groups of consumers bystudying a small sample of the total consumer population3 Designing a sample calls for three decisionsa Who is to be surveyed (what sampling unit)b How many people should be surveyed (what sample size)c How should the sample be chosen (what sampling procedure)4 Kinds of samples includea Probability samples--each population member has a known chance of beingincluded in the sample and researchers can calculate confidence limits for samplingerrorb Nonprobability samples--sampling error cannot be measuredResearch InstrumentsIn collecting primary data marketing researchers have a choice of two main researchinstrumentsmdashthe questionnaire and mechanical devices The questionnaire is by far the mostcommon instrument whether administered in person by phone or online Questionnaires are veryflexiblemdashthere are many ways to ask questions However they must be developed carefully andtested before they can be used on a large scale A carelessly prepared questionnaire usually containsseveral errors In preparing a questionnaire the marketing researcher must first decide what questions to askQuestionnaires frequently leave out questions that should be answered and include questions that

cannot be answered will not be answered or need not be answered Each question should bechecked to see that it contributes to the research objectivesThe form of each question can influence the response Marketing researchers distinguish betweenclosed-end questions and open-end questions Closed-end questions include all the possibleanswers and subjects make choices among them Examples include multiple-choice questions andscale questions Open-end questions allow respondents to answer in their own words Open-endquestions often reveal more than closed-end questions because respondents are not limited in theiranswers Open-end questions are especially useful in exploratory research when the researcher istrying to find out what people think but not measuring how many people think in a certain wayClosed-end questions on the other hand provide answers that are easier to interpret and tabulateResearchers should also use care in the wording and ordering of questions They should usesimple direct unbiased wording Questions should be arranged in a logical order The firstquestion should create interest if possible and difficult or personal questions should be asked lastso that respondents do not become defensiveAlthough questionnaires are the most common research instrument mechanical instruments alsoare used We discussed two mechanical instruments people meters and supermarket scannersearlier in the chapter Another group of mechanical devices measures subjects physical responses

Step 3 Implementing the Research Plan

The researcher next puts the marketing research plan into action This involves collectingprocessing and analyzing the information Data collection can be carried out by the companysmarketing research staff or by outside firms The company keeps more control over the collectionprocess and data quality by using its own staff However outside firms that specialize in datacollection often can do the job more quickly and at a lower costThe data collection phase of the marketing research process is generally the most expensive andthe most subject to error The researcher should watch fieldwork closely to make sure that the planis implemented correctly and to guard against problems with contacting respondents withrespondents who refuse to cooperate or who give biased or dishonest answers and withinterviewers who make mistakes or take shortcuts

Step 4 Interpreting and Reporting the Findings

The final step in the marketing research process is interpreting and reporting the findings Theresearchers should keep from overwhelming managers with numbers and fancy statisticaltechniques Researchers should present important findings that are useful in the major decisionsfaced by management Interpretation should not be left only to researchers Marketing managerswill also have important insights into the problems Interpretation is an important phase of themarketing process The best research is meaningless if the manager blindly accepts wronginterpretations from the researcherThe researcher must now interpret the findings draw conclusions and report them tomanagement The researcher should not try to overwhelm managers with numbers and fancystatistical techniques Rather the researcher should present important findings that are useful inthe major decisions faced by managementHowever interpretation should not be left only to the researchers They are often experts inresearch design and statistics but the marketing manager knows more about the problem and the

decisions that must be made

In many cases findings can be interpreted in different ways anddiscussions between researchers and managers will help point to the best interpretations Themanager will also want to check that the research project was carried out properly and that all thenecessary analysis was completed Or after seeing the findings the manager may have additionalquestions that can be answered through further sifting of the data Finally the manager is the onewho ultimately must decide what action the research suggests The researchers may even make thedata directly available to marketing managers so that they can perform new analyses and test newrelationships on their ownInterpretation is an important phase of the marketing process The best research is meaningless ifthe manager blindly accepts faulty interpretations from the researcher Similarly managers may bebiasedmdashthey might tend to accept research results that show what they expected and to rejectthose that they did not expect or hope for Thus managers and researchers must work togetherclosely when interpreting research results and both must share responsibility for the researchprocess and resulting decisions

RESEARCH DESIGN

Exploratory research and itrsquos methods

Exploratory research is conducted to clarify ambiguous problems Management may have discovered general problems but research is needed to gain better understanding of the dimensions of the problems Exploratory studies provide information to use in analyzing a situation but uncovering conclusive evidence to determine a particular course of action is not the purpose of exploratory research Usually exploratory research is conducted with the expectation that subsequent research will be required to provide conclusive evidence It is a serious mistake to rush into detailed surveys before less expensive and more readily available sources of information have been exhausted

In an organisation considering a program to help employees with childcare needs for example exploratory research with a small number of employees who have children might determine that many of them have spouses who also work and that these employees have positive reactions to the possibility of an on-site child-care program In such a case exploratory research helps to crystallize a problem and identify information needs for future research

Exploratory research methods

The quickest and the cheapest way to formulate a hypothesis in exploratory research is by using any of the four methods

Literature search

Experience survey

Focus group

Analysis of selected cases

Literature Search

This refers to ldquoreferring to a literature to develop a new hypothesisrdquo The literature referred are ndash trade journals professional journals market research finding publications statistical publications etc Example Suppose a problem is ldquoWhy are sales downrdquo This can quickly be analyzed with the help of published data which should indicate ldquowhether the problem is an ldquoindustry problemrdquo or a ldquofirm problemrdquo Three possibilities exist to formulate the hypothesis

The companyrsquos market share has declined but industryrsquos figures are normal

The industry is declining and hence the companyrsquos market share is also declining

The industryrsquos share is going up but the companyrsquos share is declining

If we accept the situation that our companyrsquos sales are down despite the market showing an upward trend then we need to analyse the marketing mix variables

Example 1 A TV manufacturing company feels that its market share is declining whereas the overall television industry is doing very well

Example 2 Due to a trade embargo imposed by a country textiles exports are down and hence sales of a company making garment for exports is on the decline

The above information may be used to pinpoint the reason for declining sales

Experience Survey

In experience surveys it is desirable to talk to persons who are well informed in the area being investigated These people may be company executives or persons outside the organisation Here no questionnaire is required The approach adopted in an experience survey should be highly unstructured so that the respondent can give divergent views Since the idea of using experience survey is to undertake problem formulation and not conclusion probability sample need not be used Those who cannot speak freely should be excluded from the sample

Examples

1) A group of housewives may be approached for their choice for a ldquoready to cook productrdquo

2) A publisher might want to find out the reason for poor circulation of newspaper introduced recently He might meet (a) Newspaper sellers (b) Public reading room (c) General public (d) Business community etc

These are experienced persons whose knowledge researcher can use

Focus Group

Another widely used technique in exploratory research is the focus group In a focus group a small number of individuals are brought together to study and talk about some topic of interest The discussion is co-ordinated by a moderator The group usually is of 8-12 persons While selecting these persons care has to be taken to see that they should have a common background and have similar experiences in buying This is required because there should not be a conflict among the group members on the common issues that are being discussed During the discussion future buying attitudes present buying opinion etc are gathered

Most of the companies conducting the focus groups first screen the candidates to determine who will compose the particular group Firms also take care to avoid groups in which some of the participants have their friends and relatives because this leads to a biased discussion Normally a number of such groups are constituted and the final conclusion of various groups are taken for formulating the hypothesis Therefore a key factor in focus group is to have similar groups Normally there are 4-5 groups Some of them may even have 6-8 groups The guiding criteria is to see whether the latter groups are generating additional ideas or repeating the same with respect to the subject under study When this shows a diminishing return from the group the discussions stopped The typical focus group lasts for 1-30 hours to 2 hours The moderator under the focus group has a key role His job is to guide the group to proceed in the right direction

Analysis of selected cases

Analysing a selected case sometimes gives an insight into the problem which is being researched Case histories of companies which have undergone a similar situation may be available These case studies are well suited to carry out exploratory research However the result of investigation of case histories arc always considered suggestive rather than conclusive In case of preference to ldquoready to eat foodrdquo many case histories may be available in the form of previous studies made by competitors We must carefully examine the already published case studies with regard to other variables such as price advertisement changes in the taste etc

II DESCRIPTIVE RESEARCH AND ITrsquoS METHODS

Descriptive research is used to obtain information concerning the current status of the phenomena to describe ldquowhat existsrdquo with respect to variables or conditions in a situation The methods involved range from the survey which describes the status quo the correlation study which investigates the relationship between variables to developmental studies which seek to determine changes over time

Descriptive Research Methods

1 Case Studies

Detailed analysis of a single (or limited number) of people or events Case studies are usually interesting because of the unusualness of the case The major problem with case studies is the problem of objectivity The person who is presenting the case usually has some theoretical orientation It is acceptable for a theoretical orientation to affect onersquos interpretation of events In a case study the theoretical orientation can also lead to the selection of the facts to include in the case It is not surprising that case studies often seem to provide very compelling evidence for a theory Case studies can therefore assist psychology by illustrating how a theory could be applied to a person or events and by assisting with the development of hypotheses for more systematic testing

2 Observational Research

Accounts of the natural behavior of individuals or groups in some setting Unless the observation is unobtrusive there may be some subject reactivity to being observed This often decreases with time a process called habituation Observers cannot usually observe all behaviors all of the time They may use a behavioral checklist and may also use time sampling or event sampling procedures It is important to assess observer bias by the use of interobserver reliability Observational research may also pose ethical problems These can arise when the behaviors being observed are not public behaviors and when the observer joins a group in order to observe the membersrsquo behavior ndash participant observation

3 Survey Research

Structured questions to assess peoples beliefs attitudes and self-reports of behavior If the researcher wishes to generalize the responses to a population it is important to have a representative sample Surveys that rely on self-selection (respond if you are interested) produce non-generalizable results Surveys also provide information for co relational research One can correlate responses to some questions (often demographic questions) with responses to other questions (often attitudes or reports of behavior) Survey question must be clear and unambiguous Even if the questions are unambiguous and non-leading people may display a social desirability bias and give positive or socially acceptable and desirable answers Survey methods include (1) the interview or face-to-face method which is generally viewed as the best method for obtaining a high rate of responses but is also very costly (2) phone surveys which are less expensive but have a higher non-response rate (which has probably increased with caller ID) and (3) written or mail surveys which are least expensive but have a very high non-response rate Follow-up messages can help increase the response rate

4 Archival Research

Analysis of pre-existing data or records Archival research often involves content analysis a qualitative analysis of material For example one would use content analysis to determine whether there had been an increase in the frequency with which women and minorities were mentioned in US history books between 1920 and 2000 Some archival research is quasi-experimental

III EXPERIMENTAL RESEARCH AND ITrsquoS STAGES

Science revolves around experiments and learning the best way of conducting an experiment is crucial to obtaining useful and valid results When scientists speak of experiments in the strictest sense of the word they mean a true experiment where the scientist controls all of the factors and conditions Real world observations and case studies should be referred to as observational research rather than experiments For example observing animals in the wild is not a true experiment because it does not isolate and manipulate an independent variable

THE BASIS OF CONDUCTING AN EXPERIMENT

With an experiment the researcher is trying to learn something new about the world an explanation of lsquowhyrsquo something happens The experiment must maintain internal and external validity or the results will be useless When designing an experiment a researcher must follow all of the steps of the scientific method from making sure that the hypothesis is valid and testable to using controls and statistical tests

Whilst all scientists use reasoning operationalization and the steps of the scientific process it is not always a conscious process Experience and practice mean that many scientists follow an instinctive process of conducting an experiment the lsquostreamlinedrsquo scientific process Following the basic steps will usually generate valid results but where experiments are complex and expensive it is always advisable to follow the rigorous scientific protocols

Conducting a experiment has a number of stages where the parameters and structure of the experiment are made clear Whilst it is rarely practical to follow each step strictly any aberrations must be justified whether they arise because of budget impracticality or ethics

STAGE ONE

After deciding upon a hypothesis and making predictions the first stage of conducting an experiment is to specify the sample groups These should be large enough to give a statistically viable study but small enough to be practical Ideally groups should be selected at random from a wide selection of the sample population This allows results to be generalized to the population as a whole In the physical sciences this is fairly easy but the biological and behavioral sciences are often limited by other factors

For example medical trials often cannot find random groups Such research often relies upon volunteers so it is difficult to apply any realistic randomization This is not a problem as long as the process is justified and the results are not applied to the population as a whole If a psychological researcher used volunteers who were male students aged between 18 and 24 the findings can only be generalized to that specific demographic group within society

STAGE TWO

The sample groups should be divided into a control group and a test group to reduce the possibility of confounding variables This again should be random and the assigning of subjects to groups should be blind or double blind This will reduce the chances of experimental error or bias when conducting an experiment

Ethics are often a barrier to this process because deliberately withholding treatment is not permitted Again any deviations from this process must be explained in the conclusion There is nothing wrong with compromising upon randomness where necessary as long as other scientists are aware of how and why the researcher selected groups on that basis

STAGE THREE

This stage of conducting an experiment involves determining the time scale and frequency of sampling to fit the type of experiment For example researchers studying the effectiveness of a cure for colds would take frequent samples over a period of days Researchers testing a cure for Parkinsonrsquos disease would use less frequent tests over a period of months or years

STAGE FOUR

The penultimate stage of the experiment involves performing the experiment according to the methods stipulated during the design phase The independent variable is manipulated generating a usable data set for the dependent variable

STAGE FIVE

The raw data from the results should be gathered and analyzed by statistical means This allows the researcher to establish if there is any relationship between the variables and accept or reject the null hypothesis

These steps are essential to providing excellent results Whilst many researchers do not want to become involved in the exact processes of inductive reasoning deductive reasoning and operationalization they all follow the basic steps of conducting an experiment This ensures that their results are valid

middot Product type size and pack type by territorymiddot Product type size and pack type by type of accountmiddot Product type size and pack type by industrymiddot Product type size and pack type by customermiddot Average value andor volume of sale by territorymiddot Average value andor volume of sale by type of accountmiddot Average value andor volume of sale by industrymiddot Average value andor volume of sale by sales person

By comparing orders received with invoices an enterprise can establish the extent to which it is providing an acceptable level of customer service In the same way comparing stockholding records with orders received helps an enterprise ascertain whether its stocks are in line with current demand patterns

Marketing research systems The general topic of marketing research has been the prime subject of the textbook and only a little more needs to be added here Marketing research is a proactive search for information That is the enterprise which commissions these studies does so to solve a perceived marketing problem In many cases data is collected in a purposeful way to address a well-defined problem (or a problem which can be defined and solved within the course of the study) The other form of marketing research centres not around a specific marketing problem but is an attempt to continuously monitor the marketing environment These monitoring or tracking exercises are continuous marketing research studies often involving panels of farmers consumers or distributors from which the same data is collected at regular intervals Whilst the ad hoc study and continuous marketing research differs in the orientation yet they are both proactive

Marketing intelligence systems Whereas marketing research is focused market intelligence is not A marketing intelligence system is a set of procedures and data sources used by marketing managers to sift information from the environment that they can use in their decision making This scanning of the economic and business environment can be undertaken in a variety of ways including2

Unfocused scanning

The manager by virtue of what heshe reads hears and watches exposes himherself to information that may prove useful Whilst the behaviour is unfocused and the manager has no specific purpose in mind it is not unintentional

Semi-focused scanning

Again the manager is not in search of particular pieces of information that heshe is actively searching but does narrow the range of media that is scanned For instance the manager may focus more on economic and business publications broadcasts etc and pay less attention to political scientific or technological media

Informal search

This describes the situation where a fairly limited and unstructured attempt is made to obtain information for a specific purpose For example the marketing manager of a firm considering entering the business of importing frozen fish from a neighbouring country may make informal inquiries as to prices and demand levels of frozen and fresh fish There would be little structure to this search with the manager making inquiries with traders heshe happens to encounter as well as with other ad hoc contacts in ministries international aid agencies with trade associations importersexporters etc

Formal search

This is a purposeful search after information in some systematic way The information will be required to address a specific issue Whilst this sort of activity may seem to share the characteristics of marketing research it is carried out by the manager himherself rather than a professional researcher Moreover the scope of the search is likely to be narrow in scope and far less intensive than marketing research

Marketing intelligence is the province of entrepreneurs and senior managers within an agribusiness It involves them in scanning newspaper trade magazines business journals and reports economic forecasts and other media In addition it involves management in talking to producers suppliers and customers as well as to competitors Nonetheless it is a largely informal process of observing and conversing

Some enterprises will approach marketing intelligence gathering in a more deliberate fashion and will train its sales force after-sales personnel and districtarea managers to take cognisance of competitors actions customer complaints and requests and distributor problems Enterprises with vision will also encourage intermediaries such as collectors retailers traders and other middlemen to be proactive in conveying market intelligence back to them

Marketing models Within the MIS there has to be the means of interpreting information in order to give direction to decision These models may be computerised or may not Typical tools are

middot Time series sales modesmiddot Brand switching modelsmiddot Linear programmingmiddot Elasticity models (price incomes demand supply etc)middot Regression and correlation modelsmiddot Analysis of Variance (ANOVA) modelsmiddot Sensitivity analysismiddot Discounted cash flowmiddot Spreadsheet what if models

These and similar mathematical statistical econometric and financial models are the analytical subsystem of the MIS A relatively modest investment in a desktop computer is enough to allow an enterprise to automate the analysis of its data Some of the models used are stochastic ie those containing a probabilistic element whereas others are deterministic models where chance plays no part Brand switching models are stochastic since these express brand choices in probabilities whereas linear programming is deterministic in that the relationships between variables are expressed in exact mathematical terms

THE MARKETING RESEARCH PROCESS

a Marketing Research an Introduction

Every marketer needs marketing research and most large companies have their own marketingresearch departments Marketing research involves a four-step process The first step consists ofthe manager and researcher carefully defining the problem and setting the research objectives Theobjective may be exploratory descriptive or causal The second step consists of developing the

research plan for collecting data from primary and secondary sources Primary data collection callsfor choosing a research approach (observation survey experiment) choosing a contact method(mail telephone personal) designing a sampling plan (whom to survey how many to survey andhow to choose them) and developing research instruments (questionnaire mechanical) The thirdstep consists of implementing the marketing research plan by collecting processing and analyzingthe information The fourth step consists of interpreting and reporting the findings Furtherinformation analysis helps marketing managers to apply the information and provides advancedstatistical procedures and models to develop more rigorous findings from the informationSome marketers face special marketing research considerations such as conducting research insmall-business non-profit or international situations Marketing research can be conductedeffectively by small organizations with small budgets International marketing researchers follow the same steps as domestic researchers but often face more challenging problems All organizations need to understand the major public policy and ethics issues surrounding marketing research

b Uses amp Application of Research in Marketing

Decision-making is crucial process in all types of the organization This decision-making requiresthen information that is collected and acquired through the marketing research process thisinformation can be regarding customers companies or competitor or the other environmentalfactors Major uses of the marketing research in the organizations are as following1048713 Measurement of market potential1048713 Analysis of market share1048713 Determination of market characteristics1048713 Sales analysis1048713 Product testing1048713 Forecasting1048713 Studies of business trends1048713 Studies of competitors products

c THE MARKETING RESEARCH PROCESS

Before researcher can provide managers with information they mustknow what kind of problem the manager wishes to solve Marketingresearch process has following steps1 Defining the problem and research objectives2 Developing the research plan3 Implementing the research plan and4 Interpreting and reporting the findings

Now we will discuss these steps in detail

Step 1 Defining the Problem and Research Objectives

The marketing manager and the researcher must work closely together to define the problemcarefully and agree on the research objectives Marketing managers must know enough aboutmarketing research to help in the planning and to interpret research results Defining the problemand research objectives is often the hardest step in the process After the problem has been definedcarefully the manager and researcher must set the research objectives The three general types ofobjectives are1) Exploratory research where the objective is to gather preliminary information thatwill help to better define problems and suggest hypotheses for their solution2) Descriptive research is where the intent is to describe things such as the marketpotential for a product or the demographics and attitudes of customers who buy the product3) Casual research is research to test hypotheses about cause-and-effect relationshipsThe statement of the problem and research objectives will guide the entire research process It isalways best to put the problem and research objectives statements in writing so agreement can bereached and everyone knows the direction of the research effort

Step 2 Developing the Research Plan

In developing the research plan the attempt is to determine the information needed (outlinesources of secondary data) develop a plan for gathering it efficiently and presenting the plan tomarketing management The plan spells out specific research approaches contact methodssampling plans and instruments that researchers will use to gather new data The firm shouldknow what data already exists before the process of collecting new data begins The steps thatshould be followed are Developing the research plan involves all of the following1 Determining Specific Information Needs2 Gathering Secondary Information3 Planning Primary Data Collection

1) Determine specific information needs

In this step research objectives are translatedinto specific information needs For example determine the demographic economic and lifestylecharacteristics of a target audience

2) Gathering secondary information

a) Secondary data is information that already exists somewhere having beencollected for another purpose Sources of secondary data include both internal and externalsources Companies can buy secondary data reports from outside suppliers (ie commercial datasources)Information can be obtained by using commercial online databases Examples includeCompuServe Dialog and Lexis-Nexus Many of these sources are free Advantages of secondarydata include1 It can usually be obtained more quickly and at a lower cost than primary data2 Sometimes data can be provided that an individual company could not collect on its own

Some problems with collecting secondary data include1 The needed information might not exist2 Even if the data is found it might not be useable3 The researcher must evaluate secondary information to make certain it is relevantaccurate current and impartial Secondary data is a good starting point however the company willoften have to collect primary datab) Primary data is information collected for the specific purpose at hand

Planning Primary Data Collection

A plan for primary data collection calls for a number ofdecisions on research approaches contact methods sampling plans and research instruments

Research Approaches

a) Research approaches can be listed as

1 Observational research

where information is gained by observing relevantpeople actions and situations However some things such as feelingsattitudes motives and private behavior cannot be observed Mechanicalobservation can be obtained through single source data systems This iswhere electronic monitoring systems link consumersrsquo exposure to televisionadvertising and promotion (measured using television meters) with what theybuy in stores (measured using store checkout scanners) Observationalresearch can be used to obtain information that people are unwilling orunable to provide

2 Survey research

is the gathering of primary data by asking people questionsabout their knowledge attitudes preferences and buying behavior Survey research is best suitedfor gathering descriptive information Survey research is the most widely used form of primarydata collection The major advantage of this approach is flexibility while the disadvantages includethe respondent being unwilling to respond giving inaccurate answers or unwilling to spend thetime to answer

3 Experimental research

involves the gathering of primary data by selectingmatched groups of subjects giving them different treatments controlling related factors andchecking for differences in-group responses This form of research tries to explain cause-andeffectrelationships Observation and surveys may be used to collect information in experimentalresearch This form is best used for causal information

In last Lesson we discussed the marketing research process first two steps were discussed in thatLesson today we will continue the same topic and will be discussing the remaining steps of themarketing research process Second topic of todayrsquos Lesson is an introduction to the consumer

behaviorSo our todayrsquos topics are

A THE MARKETING RESEARCH PROCESS (Continued)

B CONSUMER MARKET

Contact Methods

Contact methods are used to obtain the information Contact methods can be listed as1 Mail questionnaires--used to collect large amounts of information at a low cost2 Telephone interviewing--good method for collecting information quickly3 Personal interviewing (which can be either individual or group interviewing)A form of personal interviewing is ldquofocus group interviewingrdquoFocus-group interviewing consists of inviting six to ten people to gather for a few hours with atrained interviewer to talk about a product service or organization The interviewer ldquofocusesrdquothe group discussion on important issues4 Online (Internet) marketing research can consist of Internet surveys or online focus groupsMany experts predict that online research will soon be the primary tool of marketing researchers5 Computer interviewing is a new method being used in the technology age Consumers readquestions from a computer screen and respondSampling plans are used to outline how samples will be constructed and used1 A sample is a segment of the population selected for marketing research to represent thepopulation as a whole2 Marketing researchers usually draw conclusions about large groups of consumers bystudying a small sample of the total consumer population3 Designing a sample calls for three decisionsa Who is to be surveyed (what sampling unit)b How many people should be surveyed (what sample size)c How should the sample be chosen (what sampling procedure)4 Kinds of samples includea Probability samples--each population member has a known chance of beingincluded in the sample and researchers can calculate confidence limits for samplingerrorb Nonprobability samples--sampling error cannot be measuredResearch InstrumentsIn collecting primary data marketing researchers have a choice of two main researchinstrumentsmdashthe questionnaire and mechanical devices The questionnaire is by far the mostcommon instrument whether administered in person by phone or online Questionnaires are veryflexiblemdashthere are many ways to ask questions However they must be developed carefully andtested before they can be used on a large scale A carelessly prepared questionnaire usually containsseveral errors In preparing a questionnaire the marketing researcher must first decide what questions to askQuestionnaires frequently leave out questions that should be answered and include questions that

cannot be answered will not be answered or need not be answered Each question should bechecked to see that it contributes to the research objectivesThe form of each question can influence the response Marketing researchers distinguish betweenclosed-end questions and open-end questions Closed-end questions include all the possibleanswers and subjects make choices among them Examples include multiple-choice questions andscale questions Open-end questions allow respondents to answer in their own words Open-endquestions often reveal more than closed-end questions because respondents are not limited in theiranswers Open-end questions are especially useful in exploratory research when the researcher istrying to find out what people think but not measuring how many people think in a certain wayClosed-end questions on the other hand provide answers that are easier to interpret and tabulateResearchers should also use care in the wording and ordering of questions They should usesimple direct unbiased wording Questions should be arranged in a logical order The firstquestion should create interest if possible and difficult or personal questions should be asked lastso that respondents do not become defensiveAlthough questionnaires are the most common research instrument mechanical instruments alsoare used We discussed two mechanical instruments people meters and supermarket scannersearlier in the chapter Another group of mechanical devices measures subjects physical responses

Step 3 Implementing the Research Plan

The researcher next puts the marketing research plan into action This involves collectingprocessing and analyzing the information Data collection can be carried out by the companysmarketing research staff or by outside firms The company keeps more control over the collectionprocess and data quality by using its own staff However outside firms that specialize in datacollection often can do the job more quickly and at a lower costThe data collection phase of the marketing research process is generally the most expensive andthe most subject to error The researcher should watch fieldwork closely to make sure that the planis implemented correctly and to guard against problems with contacting respondents withrespondents who refuse to cooperate or who give biased or dishonest answers and withinterviewers who make mistakes or take shortcuts

Step 4 Interpreting and Reporting the Findings

The final step in the marketing research process is interpreting and reporting the findings Theresearchers should keep from overwhelming managers with numbers and fancy statisticaltechniques Researchers should present important findings that are useful in the major decisionsfaced by management Interpretation should not be left only to researchers Marketing managerswill also have important insights into the problems Interpretation is an important phase of themarketing process The best research is meaningless if the manager blindly accepts wronginterpretations from the researcherThe researcher must now interpret the findings draw conclusions and report them tomanagement The researcher should not try to overwhelm managers with numbers and fancystatistical techniques Rather the researcher should present important findings that are useful inthe major decisions faced by managementHowever interpretation should not be left only to the researchers They are often experts inresearch design and statistics but the marketing manager knows more about the problem and the

decisions that must be made

In many cases findings can be interpreted in different ways anddiscussions between researchers and managers will help point to the best interpretations Themanager will also want to check that the research project was carried out properly and that all thenecessary analysis was completed Or after seeing the findings the manager may have additionalquestions that can be answered through further sifting of the data Finally the manager is the onewho ultimately must decide what action the research suggests The researchers may even make thedata directly available to marketing managers so that they can perform new analyses and test newrelationships on their ownInterpretation is an important phase of the marketing process The best research is meaningless ifthe manager blindly accepts faulty interpretations from the researcher Similarly managers may bebiasedmdashthey might tend to accept research results that show what they expected and to rejectthose that they did not expect or hope for Thus managers and researchers must work togetherclosely when interpreting research results and both must share responsibility for the researchprocess and resulting decisions

RESEARCH DESIGN

Exploratory research and itrsquos methods

Exploratory research is conducted to clarify ambiguous problems Management may have discovered general problems but research is needed to gain better understanding of the dimensions of the problems Exploratory studies provide information to use in analyzing a situation but uncovering conclusive evidence to determine a particular course of action is not the purpose of exploratory research Usually exploratory research is conducted with the expectation that subsequent research will be required to provide conclusive evidence It is a serious mistake to rush into detailed surveys before less expensive and more readily available sources of information have been exhausted

In an organisation considering a program to help employees with childcare needs for example exploratory research with a small number of employees who have children might determine that many of them have spouses who also work and that these employees have positive reactions to the possibility of an on-site child-care program In such a case exploratory research helps to crystallize a problem and identify information needs for future research

Exploratory research methods

The quickest and the cheapest way to formulate a hypothesis in exploratory research is by using any of the four methods

Literature search

Experience survey

Focus group

Analysis of selected cases

Literature Search

This refers to ldquoreferring to a literature to develop a new hypothesisrdquo The literature referred are ndash trade journals professional journals market research finding publications statistical publications etc Example Suppose a problem is ldquoWhy are sales downrdquo This can quickly be analyzed with the help of published data which should indicate ldquowhether the problem is an ldquoindustry problemrdquo or a ldquofirm problemrdquo Three possibilities exist to formulate the hypothesis

The companyrsquos market share has declined but industryrsquos figures are normal

The industry is declining and hence the companyrsquos market share is also declining

The industryrsquos share is going up but the companyrsquos share is declining

If we accept the situation that our companyrsquos sales are down despite the market showing an upward trend then we need to analyse the marketing mix variables

Example 1 A TV manufacturing company feels that its market share is declining whereas the overall television industry is doing very well

Example 2 Due to a trade embargo imposed by a country textiles exports are down and hence sales of a company making garment for exports is on the decline

The above information may be used to pinpoint the reason for declining sales

Experience Survey

In experience surveys it is desirable to talk to persons who are well informed in the area being investigated These people may be company executives or persons outside the organisation Here no questionnaire is required The approach adopted in an experience survey should be highly unstructured so that the respondent can give divergent views Since the idea of using experience survey is to undertake problem formulation and not conclusion probability sample need not be used Those who cannot speak freely should be excluded from the sample

Examples

1) A group of housewives may be approached for their choice for a ldquoready to cook productrdquo

2) A publisher might want to find out the reason for poor circulation of newspaper introduced recently He might meet (a) Newspaper sellers (b) Public reading room (c) General public (d) Business community etc

These are experienced persons whose knowledge researcher can use

Focus Group

Another widely used technique in exploratory research is the focus group In a focus group a small number of individuals are brought together to study and talk about some topic of interest The discussion is co-ordinated by a moderator The group usually is of 8-12 persons While selecting these persons care has to be taken to see that they should have a common background and have similar experiences in buying This is required because there should not be a conflict among the group members on the common issues that are being discussed During the discussion future buying attitudes present buying opinion etc are gathered

Most of the companies conducting the focus groups first screen the candidates to determine who will compose the particular group Firms also take care to avoid groups in which some of the participants have their friends and relatives because this leads to a biased discussion Normally a number of such groups are constituted and the final conclusion of various groups are taken for formulating the hypothesis Therefore a key factor in focus group is to have similar groups Normally there are 4-5 groups Some of them may even have 6-8 groups The guiding criteria is to see whether the latter groups are generating additional ideas or repeating the same with respect to the subject under study When this shows a diminishing return from the group the discussions stopped The typical focus group lasts for 1-30 hours to 2 hours The moderator under the focus group has a key role His job is to guide the group to proceed in the right direction

Analysis of selected cases

Analysing a selected case sometimes gives an insight into the problem which is being researched Case histories of companies which have undergone a similar situation may be available These case studies are well suited to carry out exploratory research However the result of investigation of case histories arc always considered suggestive rather than conclusive In case of preference to ldquoready to eat foodrdquo many case histories may be available in the form of previous studies made by competitors We must carefully examine the already published case studies with regard to other variables such as price advertisement changes in the taste etc

II DESCRIPTIVE RESEARCH AND ITrsquoS METHODS

Descriptive research is used to obtain information concerning the current status of the phenomena to describe ldquowhat existsrdquo with respect to variables or conditions in a situation The methods involved range from the survey which describes the status quo the correlation study which investigates the relationship between variables to developmental studies which seek to determine changes over time

Descriptive Research Methods

1 Case Studies

Detailed analysis of a single (or limited number) of people or events Case studies are usually interesting because of the unusualness of the case The major problem with case studies is the problem of objectivity The person who is presenting the case usually has some theoretical orientation It is acceptable for a theoretical orientation to affect onersquos interpretation of events In a case study the theoretical orientation can also lead to the selection of the facts to include in the case It is not surprising that case studies often seem to provide very compelling evidence for a theory Case studies can therefore assist psychology by illustrating how a theory could be applied to a person or events and by assisting with the development of hypotheses for more systematic testing

2 Observational Research

Accounts of the natural behavior of individuals or groups in some setting Unless the observation is unobtrusive there may be some subject reactivity to being observed This often decreases with time a process called habituation Observers cannot usually observe all behaviors all of the time They may use a behavioral checklist and may also use time sampling or event sampling procedures It is important to assess observer bias by the use of interobserver reliability Observational research may also pose ethical problems These can arise when the behaviors being observed are not public behaviors and when the observer joins a group in order to observe the membersrsquo behavior ndash participant observation

3 Survey Research

Structured questions to assess peoples beliefs attitudes and self-reports of behavior If the researcher wishes to generalize the responses to a population it is important to have a representative sample Surveys that rely on self-selection (respond if you are interested) produce non-generalizable results Surveys also provide information for co relational research One can correlate responses to some questions (often demographic questions) with responses to other questions (often attitudes or reports of behavior) Survey question must be clear and unambiguous Even if the questions are unambiguous and non-leading people may display a social desirability bias and give positive or socially acceptable and desirable answers Survey methods include (1) the interview or face-to-face method which is generally viewed as the best method for obtaining a high rate of responses but is also very costly (2) phone surveys which are less expensive but have a higher non-response rate (which has probably increased with caller ID) and (3) written or mail surveys which are least expensive but have a very high non-response rate Follow-up messages can help increase the response rate

4 Archival Research

Analysis of pre-existing data or records Archival research often involves content analysis a qualitative analysis of material For example one would use content analysis to determine whether there had been an increase in the frequency with which women and minorities were mentioned in US history books between 1920 and 2000 Some archival research is quasi-experimental

III EXPERIMENTAL RESEARCH AND ITrsquoS STAGES

Science revolves around experiments and learning the best way of conducting an experiment is crucial to obtaining useful and valid results When scientists speak of experiments in the strictest sense of the word they mean a true experiment where the scientist controls all of the factors and conditions Real world observations and case studies should be referred to as observational research rather than experiments For example observing animals in the wild is not a true experiment because it does not isolate and manipulate an independent variable

THE BASIS OF CONDUCTING AN EXPERIMENT

With an experiment the researcher is trying to learn something new about the world an explanation of lsquowhyrsquo something happens The experiment must maintain internal and external validity or the results will be useless When designing an experiment a researcher must follow all of the steps of the scientific method from making sure that the hypothesis is valid and testable to using controls and statistical tests

Whilst all scientists use reasoning operationalization and the steps of the scientific process it is not always a conscious process Experience and practice mean that many scientists follow an instinctive process of conducting an experiment the lsquostreamlinedrsquo scientific process Following the basic steps will usually generate valid results but where experiments are complex and expensive it is always advisable to follow the rigorous scientific protocols

Conducting a experiment has a number of stages where the parameters and structure of the experiment are made clear Whilst it is rarely practical to follow each step strictly any aberrations must be justified whether they arise because of budget impracticality or ethics

STAGE ONE

After deciding upon a hypothesis and making predictions the first stage of conducting an experiment is to specify the sample groups These should be large enough to give a statistically viable study but small enough to be practical Ideally groups should be selected at random from a wide selection of the sample population This allows results to be generalized to the population as a whole In the physical sciences this is fairly easy but the biological and behavioral sciences are often limited by other factors

For example medical trials often cannot find random groups Such research often relies upon volunteers so it is difficult to apply any realistic randomization This is not a problem as long as the process is justified and the results are not applied to the population as a whole If a psychological researcher used volunteers who were male students aged between 18 and 24 the findings can only be generalized to that specific demographic group within society

STAGE TWO

The sample groups should be divided into a control group and a test group to reduce the possibility of confounding variables This again should be random and the assigning of subjects to groups should be blind or double blind This will reduce the chances of experimental error or bias when conducting an experiment

Ethics are often a barrier to this process because deliberately withholding treatment is not permitted Again any deviations from this process must be explained in the conclusion There is nothing wrong with compromising upon randomness where necessary as long as other scientists are aware of how and why the researcher selected groups on that basis

STAGE THREE

This stage of conducting an experiment involves determining the time scale and frequency of sampling to fit the type of experiment For example researchers studying the effectiveness of a cure for colds would take frequent samples over a period of days Researchers testing a cure for Parkinsonrsquos disease would use less frequent tests over a period of months or years

STAGE FOUR

The penultimate stage of the experiment involves performing the experiment according to the methods stipulated during the design phase The independent variable is manipulated generating a usable data set for the dependent variable

STAGE FIVE

The raw data from the results should be gathered and analyzed by statistical means This allows the researcher to establish if there is any relationship between the variables and accept or reject the null hypothesis

These steps are essential to providing excellent results Whilst many researchers do not want to become involved in the exact processes of inductive reasoning deductive reasoning and operationalization they all follow the basic steps of conducting an experiment This ensures that their results are valid

Formal search

This is a purposeful search after information in some systematic way The information will be required to address a specific issue Whilst this sort of activity may seem to share the characteristics of marketing research it is carried out by the manager himherself rather than a professional researcher Moreover the scope of the search is likely to be narrow in scope and far less intensive than marketing research

Marketing intelligence is the province of entrepreneurs and senior managers within an agribusiness It involves them in scanning newspaper trade magazines business journals and reports economic forecasts and other media In addition it involves management in talking to producers suppliers and customers as well as to competitors Nonetheless it is a largely informal process of observing and conversing

Some enterprises will approach marketing intelligence gathering in a more deliberate fashion and will train its sales force after-sales personnel and districtarea managers to take cognisance of competitors actions customer complaints and requests and distributor problems Enterprises with vision will also encourage intermediaries such as collectors retailers traders and other middlemen to be proactive in conveying market intelligence back to them

Marketing models Within the MIS there has to be the means of interpreting information in order to give direction to decision These models may be computerised or may not Typical tools are

middot Time series sales modesmiddot Brand switching modelsmiddot Linear programmingmiddot Elasticity models (price incomes demand supply etc)middot Regression and correlation modelsmiddot Analysis of Variance (ANOVA) modelsmiddot Sensitivity analysismiddot Discounted cash flowmiddot Spreadsheet what if models

These and similar mathematical statistical econometric and financial models are the analytical subsystem of the MIS A relatively modest investment in a desktop computer is enough to allow an enterprise to automate the analysis of its data Some of the models used are stochastic ie those containing a probabilistic element whereas others are deterministic models where chance plays no part Brand switching models are stochastic since these express brand choices in probabilities whereas linear programming is deterministic in that the relationships between variables are expressed in exact mathematical terms

THE MARKETING RESEARCH PROCESS

a Marketing Research an Introduction

Every marketer needs marketing research and most large companies have their own marketingresearch departments Marketing research involves a four-step process The first step consists ofthe manager and researcher carefully defining the problem and setting the research objectives Theobjective may be exploratory descriptive or causal The second step consists of developing the

research plan for collecting data from primary and secondary sources Primary data collection callsfor choosing a research approach (observation survey experiment) choosing a contact method(mail telephone personal) designing a sampling plan (whom to survey how many to survey andhow to choose them) and developing research instruments (questionnaire mechanical) The thirdstep consists of implementing the marketing research plan by collecting processing and analyzingthe information The fourth step consists of interpreting and reporting the findings Furtherinformation analysis helps marketing managers to apply the information and provides advancedstatistical procedures and models to develop more rigorous findings from the informationSome marketers face special marketing research considerations such as conducting research insmall-business non-profit or international situations Marketing research can be conductedeffectively by small organizations with small budgets International marketing researchers follow the same steps as domestic researchers but often face more challenging problems All organizations need to understand the major public policy and ethics issues surrounding marketing research

b Uses amp Application of Research in Marketing

Decision-making is crucial process in all types of the organization This decision-making requiresthen information that is collected and acquired through the marketing research process thisinformation can be regarding customers companies or competitor or the other environmentalfactors Major uses of the marketing research in the organizations are as following1048713 Measurement of market potential1048713 Analysis of market share1048713 Determination of market characteristics1048713 Sales analysis1048713 Product testing1048713 Forecasting1048713 Studies of business trends1048713 Studies of competitors products

c THE MARKETING RESEARCH PROCESS

Before researcher can provide managers with information they mustknow what kind of problem the manager wishes to solve Marketingresearch process has following steps1 Defining the problem and research objectives2 Developing the research plan3 Implementing the research plan and4 Interpreting and reporting the findings

Now we will discuss these steps in detail

Step 1 Defining the Problem and Research Objectives

The marketing manager and the researcher must work closely together to define the problemcarefully and agree on the research objectives Marketing managers must know enough aboutmarketing research to help in the planning and to interpret research results Defining the problemand research objectives is often the hardest step in the process After the problem has been definedcarefully the manager and researcher must set the research objectives The three general types ofobjectives are1) Exploratory research where the objective is to gather preliminary information thatwill help to better define problems and suggest hypotheses for their solution2) Descriptive research is where the intent is to describe things such as the marketpotential for a product or the demographics and attitudes of customers who buy the product3) Casual research is research to test hypotheses about cause-and-effect relationshipsThe statement of the problem and research objectives will guide the entire research process It isalways best to put the problem and research objectives statements in writing so agreement can bereached and everyone knows the direction of the research effort

Step 2 Developing the Research Plan

In developing the research plan the attempt is to determine the information needed (outlinesources of secondary data) develop a plan for gathering it efficiently and presenting the plan tomarketing management The plan spells out specific research approaches contact methodssampling plans and instruments that researchers will use to gather new data The firm shouldknow what data already exists before the process of collecting new data begins The steps thatshould be followed are Developing the research plan involves all of the following1 Determining Specific Information Needs2 Gathering Secondary Information3 Planning Primary Data Collection

1) Determine specific information needs

In this step research objectives are translatedinto specific information needs For example determine the demographic economic and lifestylecharacteristics of a target audience

2) Gathering secondary information

a) Secondary data is information that already exists somewhere having beencollected for another purpose Sources of secondary data include both internal and externalsources Companies can buy secondary data reports from outside suppliers (ie commercial datasources)Information can be obtained by using commercial online databases Examples includeCompuServe Dialog and Lexis-Nexus Many of these sources are free Advantages of secondarydata include1 It can usually be obtained more quickly and at a lower cost than primary data2 Sometimes data can be provided that an individual company could not collect on its own

Some problems with collecting secondary data include1 The needed information might not exist2 Even if the data is found it might not be useable3 The researcher must evaluate secondary information to make certain it is relevantaccurate current and impartial Secondary data is a good starting point however the company willoften have to collect primary datab) Primary data is information collected for the specific purpose at hand

Planning Primary Data Collection

A plan for primary data collection calls for a number ofdecisions on research approaches contact methods sampling plans and research instruments

Research Approaches

a) Research approaches can be listed as

1 Observational research

where information is gained by observing relevantpeople actions and situations However some things such as feelingsattitudes motives and private behavior cannot be observed Mechanicalobservation can be obtained through single source data systems This iswhere electronic monitoring systems link consumersrsquo exposure to televisionadvertising and promotion (measured using television meters) with what theybuy in stores (measured using store checkout scanners) Observationalresearch can be used to obtain information that people are unwilling orunable to provide

2 Survey research

is the gathering of primary data by asking people questionsabout their knowledge attitudes preferences and buying behavior Survey research is best suitedfor gathering descriptive information Survey research is the most widely used form of primarydata collection The major advantage of this approach is flexibility while the disadvantages includethe respondent being unwilling to respond giving inaccurate answers or unwilling to spend thetime to answer

3 Experimental research

involves the gathering of primary data by selectingmatched groups of subjects giving them different treatments controlling related factors andchecking for differences in-group responses This form of research tries to explain cause-andeffectrelationships Observation and surveys may be used to collect information in experimentalresearch This form is best used for causal information

In last Lesson we discussed the marketing research process first two steps were discussed in thatLesson today we will continue the same topic and will be discussing the remaining steps of themarketing research process Second topic of todayrsquos Lesson is an introduction to the consumer

behaviorSo our todayrsquos topics are

A THE MARKETING RESEARCH PROCESS (Continued)

B CONSUMER MARKET

Contact Methods

Contact methods are used to obtain the information Contact methods can be listed as1 Mail questionnaires--used to collect large amounts of information at a low cost2 Telephone interviewing--good method for collecting information quickly3 Personal interviewing (which can be either individual or group interviewing)A form of personal interviewing is ldquofocus group interviewingrdquoFocus-group interviewing consists of inviting six to ten people to gather for a few hours with atrained interviewer to talk about a product service or organization The interviewer ldquofocusesrdquothe group discussion on important issues4 Online (Internet) marketing research can consist of Internet surveys or online focus groupsMany experts predict that online research will soon be the primary tool of marketing researchers5 Computer interviewing is a new method being used in the technology age Consumers readquestions from a computer screen and respondSampling plans are used to outline how samples will be constructed and used1 A sample is a segment of the population selected for marketing research to represent thepopulation as a whole2 Marketing researchers usually draw conclusions about large groups of consumers bystudying a small sample of the total consumer population3 Designing a sample calls for three decisionsa Who is to be surveyed (what sampling unit)b How many people should be surveyed (what sample size)c How should the sample be chosen (what sampling procedure)4 Kinds of samples includea Probability samples--each population member has a known chance of beingincluded in the sample and researchers can calculate confidence limits for samplingerrorb Nonprobability samples--sampling error cannot be measuredResearch InstrumentsIn collecting primary data marketing researchers have a choice of two main researchinstrumentsmdashthe questionnaire and mechanical devices The questionnaire is by far the mostcommon instrument whether administered in person by phone or online Questionnaires are veryflexiblemdashthere are many ways to ask questions However they must be developed carefully andtested before they can be used on a large scale A carelessly prepared questionnaire usually containsseveral errors In preparing a questionnaire the marketing researcher must first decide what questions to askQuestionnaires frequently leave out questions that should be answered and include questions that

cannot be answered will not be answered or need not be answered Each question should bechecked to see that it contributes to the research objectivesThe form of each question can influence the response Marketing researchers distinguish betweenclosed-end questions and open-end questions Closed-end questions include all the possibleanswers and subjects make choices among them Examples include multiple-choice questions andscale questions Open-end questions allow respondents to answer in their own words Open-endquestions often reveal more than closed-end questions because respondents are not limited in theiranswers Open-end questions are especially useful in exploratory research when the researcher istrying to find out what people think but not measuring how many people think in a certain wayClosed-end questions on the other hand provide answers that are easier to interpret and tabulateResearchers should also use care in the wording and ordering of questions They should usesimple direct unbiased wording Questions should be arranged in a logical order The firstquestion should create interest if possible and difficult or personal questions should be asked lastso that respondents do not become defensiveAlthough questionnaires are the most common research instrument mechanical instruments alsoare used We discussed two mechanical instruments people meters and supermarket scannersearlier in the chapter Another group of mechanical devices measures subjects physical responses

Step 3 Implementing the Research Plan

The researcher next puts the marketing research plan into action This involves collectingprocessing and analyzing the information Data collection can be carried out by the companysmarketing research staff or by outside firms The company keeps more control over the collectionprocess and data quality by using its own staff However outside firms that specialize in datacollection often can do the job more quickly and at a lower costThe data collection phase of the marketing research process is generally the most expensive andthe most subject to error The researcher should watch fieldwork closely to make sure that the planis implemented correctly and to guard against problems with contacting respondents withrespondents who refuse to cooperate or who give biased or dishonest answers and withinterviewers who make mistakes or take shortcuts

Step 4 Interpreting and Reporting the Findings

The final step in the marketing research process is interpreting and reporting the findings Theresearchers should keep from overwhelming managers with numbers and fancy statisticaltechniques Researchers should present important findings that are useful in the major decisionsfaced by management Interpretation should not be left only to researchers Marketing managerswill also have important insights into the problems Interpretation is an important phase of themarketing process The best research is meaningless if the manager blindly accepts wronginterpretations from the researcherThe researcher must now interpret the findings draw conclusions and report them tomanagement The researcher should not try to overwhelm managers with numbers and fancystatistical techniques Rather the researcher should present important findings that are useful inthe major decisions faced by managementHowever interpretation should not be left only to the researchers They are often experts inresearch design and statistics but the marketing manager knows more about the problem and the

decisions that must be made

In many cases findings can be interpreted in different ways anddiscussions between researchers and managers will help point to the best interpretations Themanager will also want to check that the research project was carried out properly and that all thenecessary analysis was completed Or after seeing the findings the manager may have additionalquestions that can be answered through further sifting of the data Finally the manager is the onewho ultimately must decide what action the research suggests The researchers may even make thedata directly available to marketing managers so that they can perform new analyses and test newrelationships on their ownInterpretation is an important phase of the marketing process The best research is meaningless ifthe manager blindly accepts faulty interpretations from the researcher Similarly managers may bebiasedmdashthey might tend to accept research results that show what they expected and to rejectthose that they did not expect or hope for Thus managers and researchers must work togetherclosely when interpreting research results and both must share responsibility for the researchprocess and resulting decisions

RESEARCH DESIGN

Exploratory research and itrsquos methods

Exploratory research is conducted to clarify ambiguous problems Management may have discovered general problems but research is needed to gain better understanding of the dimensions of the problems Exploratory studies provide information to use in analyzing a situation but uncovering conclusive evidence to determine a particular course of action is not the purpose of exploratory research Usually exploratory research is conducted with the expectation that subsequent research will be required to provide conclusive evidence It is a serious mistake to rush into detailed surveys before less expensive and more readily available sources of information have been exhausted

In an organisation considering a program to help employees with childcare needs for example exploratory research with a small number of employees who have children might determine that many of them have spouses who also work and that these employees have positive reactions to the possibility of an on-site child-care program In such a case exploratory research helps to crystallize a problem and identify information needs for future research

Exploratory research methods

The quickest and the cheapest way to formulate a hypothesis in exploratory research is by using any of the four methods

Literature search

Experience survey

Focus group

Analysis of selected cases

Literature Search

This refers to ldquoreferring to a literature to develop a new hypothesisrdquo The literature referred are ndash trade journals professional journals market research finding publications statistical publications etc Example Suppose a problem is ldquoWhy are sales downrdquo This can quickly be analyzed with the help of published data which should indicate ldquowhether the problem is an ldquoindustry problemrdquo or a ldquofirm problemrdquo Three possibilities exist to formulate the hypothesis

The companyrsquos market share has declined but industryrsquos figures are normal

The industry is declining and hence the companyrsquos market share is also declining

The industryrsquos share is going up but the companyrsquos share is declining

If we accept the situation that our companyrsquos sales are down despite the market showing an upward trend then we need to analyse the marketing mix variables

Example 1 A TV manufacturing company feels that its market share is declining whereas the overall television industry is doing very well

Example 2 Due to a trade embargo imposed by a country textiles exports are down and hence sales of a company making garment for exports is on the decline

The above information may be used to pinpoint the reason for declining sales

Experience Survey

In experience surveys it is desirable to talk to persons who are well informed in the area being investigated These people may be company executives or persons outside the organisation Here no questionnaire is required The approach adopted in an experience survey should be highly unstructured so that the respondent can give divergent views Since the idea of using experience survey is to undertake problem formulation and not conclusion probability sample need not be used Those who cannot speak freely should be excluded from the sample

Examples

1) A group of housewives may be approached for their choice for a ldquoready to cook productrdquo

2) A publisher might want to find out the reason for poor circulation of newspaper introduced recently He might meet (a) Newspaper sellers (b) Public reading room (c) General public (d) Business community etc

These are experienced persons whose knowledge researcher can use

Focus Group

Another widely used technique in exploratory research is the focus group In a focus group a small number of individuals are brought together to study and talk about some topic of interest The discussion is co-ordinated by a moderator The group usually is of 8-12 persons While selecting these persons care has to be taken to see that they should have a common background and have similar experiences in buying This is required because there should not be a conflict among the group members on the common issues that are being discussed During the discussion future buying attitudes present buying opinion etc are gathered

Most of the companies conducting the focus groups first screen the candidates to determine who will compose the particular group Firms also take care to avoid groups in which some of the participants have their friends and relatives because this leads to a biased discussion Normally a number of such groups are constituted and the final conclusion of various groups are taken for formulating the hypothesis Therefore a key factor in focus group is to have similar groups Normally there are 4-5 groups Some of them may even have 6-8 groups The guiding criteria is to see whether the latter groups are generating additional ideas or repeating the same with respect to the subject under study When this shows a diminishing return from the group the discussions stopped The typical focus group lasts for 1-30 hours to 2 hours The moderator under the focus group has a key role His job is to guide the group to proceed in the right direction

Analysis of selected cases

Analysing a selected case sometimes gives an insight into the problem which is being researched Case histories of companies which have undergone a similar situation may be available These case studies are well suited to carry out exploratory research However the result of investigation of case histories arc always considered suggestive rather than conclusive In case of preference to ldquoready to eat foodrdquo many case histories may be available in the form of previous studies made by competitors We must carefully examine the already published case studies with regard to other variables such as price advertisement changes in the taste etc

II DESCRIPTIVE RESEARCH AND ITrsquoS METHODS

Descriptive research is used to obtain information concerning the current status of the phenomena to describe ldquowhat existsrdquo with respect to variables or conditions in a situation The methods involved range from the survey which describes the status quo the correlation study which investigates the relationship between variables to developmental studies which seek to determine changes over time

Descriptive Research Methods

1 Case Studies

Detailed analysis of a single (or limited number) of people or events Case studies are usually interesting because of the unusualness of the case The major problem with case studies is the problem of objectivity The person who is presenting the case usually has some theoretical orientation It is acceptable for a theoretical orientation to affect onersquos interpretation of events In a case study the theoretical orientation can also lead to the selection of the facts to include in the case It is not surprising that case studies often seem to provide very compelling evidence for a theory Case studies can therefore assist psychology by illustrating how a theory could be applied to a person or events and by assisting with the development of hypotheses for more systematic testing

2 Observational Research

Accounts of the natural behavior of individuals or groups in some setting Unless the observation is unobtrusive there may be some subject reactivity to being observed This often decreases with time a process called habituation Observers cannot usually observe all behaviors all of the time They may use a behavioral checklist and may also use time sampling or event sampling procedures It is important to assess observer bias by the use of interobserver reliability Observational research may also pose ethical problems These can arise when the behaviors being observed are not public behaviors and when the observer joins a group in order to observe the membersrsquo behavior ndash participant observation

3 Survey Research

Structured questions to assess peoples beliefs attitudes and self-reports of behavior If the researcher wishes to generalize the responses to a population it is important to have a representative sample Surveys that rely on self-selection (respond if you are interested) produce non-generalizable results Surveys also provide information for co relational research One can correlate responses to some questions (often demographic questions) with responses to other questions (often attitudes or reports of behavior) Survey question must be clear and unambiguous Even if the questions are unambiguous and non-leading people may display a social desirability bias and give positive or socially acceptable and desirable answers Survey methods include (1) the interview or face-to-face method which is generally viewed as the best method for obtaining a high rate of responses but is also very costly (2) phone surveys which are less expensive but have a higher non-response rate (which has probably increased with caller ID) and (3) written or mail surveys which are least expensive but have a very high non-response rate Follow-up messages can help increase the response rate

4 Archival Research

Analysis of pre-existing data or records Archival research often involves content analysis a qualitative analysis of material For example one would use content analysis to determine whether there had been an increase in the frequency with which women and minorities were mentioned in US history books between 1920 and 2000 Some archival research is quasi-experimental

III EXPERIMENTAL RESEARCH AND ITrsquoS STAGES

Science revolves around experiments and learning the best way of conducting an experiment is crucial to obtaining useful and valid results When scientists speak of experiments in the strictest sense of the word they mean a true experiment where the scientist controls all of the factors and conditions Real world observations and case studies should be referred to as observational research rather than experiments For example observing animals in the wild is not a true experiment because it does not isolate and manipulate an independent variable

THE BASIS OF CONDUCTING AN EXPERIMENT

With an experiment the researcher is trying to learn something new about the world an explanation of lsquowhyrsquo something happens The experiment must maintain internal and external validity or the results will be useless When designing an experiment a researcher must follow all of the steps of the scientific method from making sure that the hypothesis is valid and testable to using controls and statistical tests

Whilst all scientists use reasoning operationalization and the steps of the scientific process it is not always a conscious process Experience and practice mean that many scientists follow an instinctive process of conducting an experiment the lsquostreamlinedrsquo scientific process Following the basic steps will usually generate valid results but where experiments are complex and expensive it is always advisable to follow the rigorous scientific protocols

Conducting a experiment has a number of stages where the parameters and structure of the experiment are made clear Whilst it is rarely practical to follow each step strictly any aberrations must be justified whether they arise because of budget impracticality or ethics

STAGE ONE

After deciding upon a hypothesis and making predictions the first stage of conducting an experiment is to specify the sample groups These should be large enough to give a statistically viable study but small enough to be practical Ideally groups should be selected at random from a wide selection of the sample population This allows results to be generalized to the population as a whole In the physical sciences this is fairly easy but the biological and behavioral sciences are often limited by other factors

For example medical trials often cannot find random groups Such research often relies upon volunteers so it is difficult to apply any realistic randomization This is not a problem as long as the process is justified and the results are not applied to the population as a whole If a psychological researcher used volunteers who were male students aged between 18 and 24 the findings can only be generalized to that specific demographic group within society

STAGE TWO

The sample groups should be divided into a control group and a test group to reduce the possibility of confounding variables This again should be random and the assigning of subjects to groups should be blind or double blind This will reduce the chances of experimental error or bias when conducting an experiment

Ethics are often a barrier to this process because deliberately withholding treatment is not permitted Again any deviations from this process must be explained in the conclusion There is nothing wrong with compromising upon randomness where necessary as long as other scientists are aware of how and why the researcher selected groups on that basis

STAGE THREE

This stage of conducting an experiment involves determining the time scale and frequency of sampling to fit the type of experiment For example researchers studying the effectiveness of a cure for colds would take frequent samples over a period of days Researchers testing a cure for Parkinsonrsquos disease would use less frequent tests over a period of months or years

STAGE FOUR

The penultimate stage of the experiment involves performing the experiment according to the methods stipulated during the design phase The independent variable is manipulated generating a usable data set for the dependent variable

STAGE FIVE

The raw data from the results should be gathered and analyzed by statistical means This allows the researcher to establish if there is any relationship between the variables and accept or reject the null hypothesis

These steps are essential to providing excellent results Whilst many researchers do not want to become involved in the exact processes of inductive reasoning deductive reasoning and operationalization they all follow the basic steps of conducting an experiment This ensures that their results are valid

Every marketer needs marketing research and most large companies have their own marketingresearch departments Marketing research involves a four-step process The first step consists ofthe manager and researcher carefully defining the problem and setting the research objectives Theobjective may be exploratory descriptive or causal The second step consists of developing the

research plan for collecting data from primary and secondary sources Primary data collection callsfor choosing a research approach (observation survey experiment) choosing a contact method(mail telephone personal) designing a sampling plan (whom to survey how many to survey andhow to choose them) and developing research instruments (questionnaire mechanical) The thirdstep consists of implementing the marketing research plan by collecting processing and analyzingthe information The fourth step consists of interpreting and reporting the findings Furtherinformation analysis helps marketing managers to apply the information and provides advancedstatistical procedures and models to develop more rigorous findings from the informationSome marketers face special marketing research considerations such as conducting research insmall-business non-profit or international situations Marketing research can be conductedeffectively by small organizations with small budgets International marketing researchers follow the same steps as domestic researchers but often face more challenging problems All organizations need to understand the major public policy and ethics issues surrounding marketing research

b Uses amp Application of Research in Marketing

Decision-making is crucial process in all types of the organization This decision-making requiresthen information that is collected and acquired through the marketing research process thisinformation can be regarding customers companies or competitor or the other environmentalfactors Major uses of the marketing research in the organizations are as following1048713 Measurement of market potential1048713 Analysis of market share1048713 Determination of market characteristics1048713 Sales analysis1048713 Product testing1048713 Forecasting1048713 Studies of business trends1048713 Studies of competitors products

c THE MARKETING RESEARCH PROCESS

Before researcher can provide managers with information they mustknow what kind of problem the manager wishes to solve Marketingresearch process has following steps1 Defining the problem and research objectives2 Developing the research plan3 Implementing the research plan and4 Interpreting and reporting the findings

Now we will discuss these steps in detail

Step 1 Defining the Problem and Research Objectives

The marketing manager and the researcher must work closely together to define the problemcarefully and agree on the research objectives Marketing managers must know enough aboutmarketing research to help in the planning and to interpret research results Defining the problemand research objectives is often the hardest step in the process After the problem has been definedcarefully the manager and researcher must set the research objectives The three general types ofobjectives are1) Exploratory research where the objective is to gather preliminary information thatwill help to better define problems and suggest hypotheses for their solution2) Descriptive research is where the intent is to describe things such as the marketpotential for a product or the demographics and attitudes of customers who buy the product3) Casual research is research to test hypotheses about cause-and-effect relationshipsThe statement of the problem and research objectives will guide the entire research process It isalways best to put the problem and research objectives statements in writing so agreement can bereached and everyone knows the direction of the research effort

Step 2 Developing the Research Plan

In developing the research plan the attempt is to determine the information needed (outlinesources of secondary data) develop a plan for gathering it efficiently and presenting the plan tomarketing management The plan spells out specific research approaches contact methodssampling plans and instruments that researchers will use to gather new data The firm shouldknow what data already exists before the process of collecting new data begins The steps thatshould be followed are Developing the research plan involves all of the following1 Determining Specific Information Needs2 Gathering Secondary Information3 Planning Primary Data Collection

1) Determine specific information needs

In this step research objectives are translatedinto specific information needs For example determine the demographic economic and lifestylecharacteristics of a target audience

2) Gathering secondary information

a) Secondary data is information that already exists somewhere having beencollected for another purpose Sources of secondary data include both internal and externalsources Companies can buy secondary data reports from outside suppliers (ie commercial datasources)Information can be obtained by using commercial online databases Examples includeCompuServe Dialog and Lexis-Nexus Many of these sources are free Advantages of secondarydata include1 It can usually be obtained more quickly and at a lower cost than primary data2 Sometimes data can be provided that an individual company could not collect on its own

Some problems with collecting secondary data include1 The needed information might not exist2 Even if the data is found it might not be useable3 The researcher must evaluate secondary information to make certain it is relevantaccurate current and impartial Secondary data is a good starting point however the company willoften have to collect primary datab) Primary data is information collected for the specific purpose at hand

Planning Primary Data Collection

A plan for primary data collection calls for a number ofdecisions on research approaches contact methods sampling plans and research instruments

Research Approaches

a) Research approaches can be listed as

1 Observational research

where information is gained by observing relevantpeople actions and situations However some things such as feelingsattitudes motives and private behavior cannot be observed Mechanicalobservation can be obtained through single source data systems This iswhere electronic monitoring systems link consumersrsquo exposure to televisionadvertising and promotion (measured using television meters) with what theybuy in stores (measured using store checkout scanners) Observationalresearch can be used to obtain information that people are unwilling orunable to provide

2 Survey research

is the gathering of primary data by asking people questionsabout their knowledge attitudes preferences and buying behavior Survey research is best suitedfor gathering descriptive information Survey research is the most widely used form of primarydata collection The major advantage of this approach is flexibility while the disadvantages includethe respondent being unwilling to respond giving inaccurate answers or unwilling to spend thetime to answer

3 Experimental research

involves the gathering of primary data by selectingmatched groups of subjects giving them different treatments controlling related factors andchecking for differences in-group responses This form of research tries to explain cause-andeffectrelationships Observation and surveys may be used to collect information in experimentalresearch This form is best used for causal information

In last Lesson we discussed the marketing research process first two steps were discussed in thatLesson today we will continue the same topic and will be discussing the remaining steps of themarketing research process Second topic of todayrsquos Lesson is an introduction to the consumer

behaviorSo our todayrsquos topics are

A THE MARKETING RESEARCH PROCESS (Continued)

B CONSUMER MARKET

Contact Methods

Contact methods are used to obtain the information Contact methods can be listed as1 Mail questionnaires--used to collect large amounts of information at a low cost2 Telephone interviewing--good method for collecting information quickly3 Personal interviewing (which can be either individual or group interviewing)A form of personal interviewing is ldquofocus group interviewingrdquoFocus-group interviewing consists of inviting six to ten people to gather for a few hours with atrained interviewer to talk about a product service or organization The interviewer ldquofocusesrdquothe group discussion on important issues4 Online (Internet) marketing research can consist of Internet surveys or online focus groupsMany experts predict that online research will soon be the primary tool of marketing researchers5 Computer interviewing is a new method being used in the technology age Consumers readquestions from a computer screen and respondSampling plans are used to outline how samples will be constructed and used1 A sample is a segment of the population selected for marketing research to represent thepopulation as a whole2 Marketing researchers usually draw conclusions about large groups of consumers bystudying a small sample of the total consumer population3 Designing a sample calls for three decisionsa Who is to be surveyed (what sampling unit)b How many people should be surveyed (what sample size)c How should the sample be chosen (what sampling procedure)4 Kinds of samples includea Probability samples--each population member has a known chance of beingincluded in the sample and researchers can calculate confidence limits for samplingerrorb Nonprobability samples--sampling error cannot be measuredResearch InstrumentsIn collecting primary data marketing researchers have a choice of two main researchinstrumentsmdashthe questionnaire and mechanical devices The questionnaire is by far the mostcommon instrument whether administered in person by phone or online Questionnaires are veryflexiblemdashthere are many ways to ask questions However they must be developed carefully andtested before they can be used on a large scale A carelessly prepared questionnaire usually containsseveral errors In preparing a questionnaire the marketing researcher must first decide what questions to askQuestionnaires frequently leave out questions that should be answered and include questions that

cannot be answered will not be answered or need not be answered Each question should bechecked to see that it contributes to the research objectivesThe form of each question can influence the response Marketing researchers distinguish betweenclosed-end questions and open-end questions Closed-end questions include all the possibleanswers and subjects make choices among them Examples include multiple-choice questions andscale questions Open-end questions allow respondents to answer in their own words Open-endquestions often reveal more than closed-end questions because respondents are not limited in theiranswers Open-end questions are especially useful in exploratory research when the researcher istrying to find out what people think but not measuring how many people think in a certain wayClosed-end questions on the other hand provide answers that are easier to interpret and tabulateResearchers should also use care in the wording and ordering of questions They should usesimple direct unbiased wording Questions should be arranged in a logical order The firstquestion should create interest if possible and difficult or personal questions should be asked lastso that respondents do not become defensiveAlthough questionnaires are the most common research instrument mechanical instruments alsoare used We discussed two mechanical instruments people meters and supermarket scannersearlier in the chapter Another group of mechanical devices measures subjects physical responses

Step 3 Implementing the Research Plan

The researcher next puts the marketing research plan into action This involves collectingprocessing and analyzing the information Data collection can be carried out by the companysmarketing research staff or by outside firms The company keeps more control over the collectionprocess and data quality by using its own staff However outside firms that specialize in datacollection often can do the job more quickly and at a lower costThe data collection phase of the marketing research process is generally the most expensive andthe most subject to error The researcher should watch fieldwork closely to make sure that the planis implemented correctly and to guard against problems with contacting respondents withrespondents who refuse to cooperate or who give biased or dishonest answers and withinterviewers who make mistakes or take shortcuts

Step 4 Interpreting and Reporting the Findings

The final step in the marketing research process is interpreting and reporting the findings Theresearchers should keep from overwhelming managers with numbers and fancy statisticaltechniques Researchers should present important findings that are useful in the major decisionsfaced by management Interpretation should not be left only to researchers Marketing managerswill also have important insights into the problems Interpretation is an important phase of themarketing process The best research is meaningless if the manager blindly accepts wronginterpretations from the researcherThe researcher must now interpret the findings draw conclusions and report them tomanagement The researcher should not try to overwhelm managers with numbers and fancystatistical techniques Rather the researcher should present important findings that are useful inthe major decisions faced by managementHowever interpretation should not be left only to the researchers They are often experts inresearch design and statistics but the marketing manager knows more about the problem and the

decisions that must be made

In many cases findings can be interpreted in different ways anddiscussions between researchers and managers will help point to the best interpretations Themanager will also want to check that the research project was carried out properly and that all thenecessary analysis was completed Or after seeing the findings the manager may have additionalquestions that can be answered through further sifting of the data Finally the manager is the onewho ultimately must decide what action the research suggests The researchers may even make thedata directly available to marketing managers so that they can perform new analyses and test newrelationships on their ownInterpretation is an important phase of the marketing process The best research is meaningless ifthe manager blindly accepts faulty interpretations from the researcher Similarly managers may bebiasedmdashthey might tend to accept research results that show what they expected and to rejectthose that they did not expect or hope for Thus managers and researchers must work togetherclosely when interpreting research results and both must share responsibility for the researchprocess and resulting decisions

RESEARCH DESIGN

Exploratory research and itrsquos methods

Exploratory research is conducted to clarify ambiguous problems Management may have discovered general problems but research is needed to gain better understanding of the dimensions of the problems Exploratory studies provide information to use in analyzing a situation but uncovering conclusive evidence to determine a particular course of action is not the purpose of exploratory research Usually exploratory research is conducted with the expectation that subsequent research will be required to provide conclusive evidence It is a serious mistake to rush into detailed surveys before less expensive and more readily available sources of information have been exhausted

In an organisation considering a program to help employees with childcare needs for example exploratory research with a small number of employees who have children might determine that many of them have spouses who also work and that these employees have positive reactions to the possibility of an on-site child-care program In such a case exploratory research helps to crystallize a problem and identify information needs for future research

Exploratory research methods

The quickest and the cheapest way to formulate a hypothesis in exploratory research is by using any of the four methods

Literature search

Experience survey

Focus group

Analysis of selected cases

Literature Search

This refers to ldquoreferring to a literature to develop a new hypothesisrdquo The literature referred are ndash trade journals professional journals market research finding publications statistical publications etc Example Suppose a problem is ldquoWhy are sales downrdquo This can quickly be analyzed with the help of published data which should indicate ldquowhether the problem is an ldquoindustry problemrdquo or a ldquofirm problemrdquo Three possibilities exist to formulate the hypothesis

The companyrsquos market share has declined but industryrsquos figures are normal

The industry is declining and hence the companyrsquos market share is also declining

The industryrsquos share is going up but the companyrsquos share is declining

If we accept the situation that our companyrsquos sales are down despite the market showing an upward trend then we need to analyse the marketing mix variables

Example 1 A TV manufacturing company feels that its market share is declining whereas the overall television industry is doing very well

Example 2 Due to a trade embargo imposed by a country textiles exports are down and hence sales of a company making garment for exports is on the decline

The above information may be used to pinpoint the reason for declining sales

Experience Survey

In experience surveys it is desirable to talk to persons who are well informed in the area being investigated These people may be company executives or persons outside the organisation Here no questionnaire is required The approach adopted in an experience survey should be highly unstructured so that the respondent can give divergent views Since the idea of using experience survey is to undertake problem formulation and not conclusion probability sample need not be used Those who cannot speak freely should be excluded from the sample

Examples

1) A group of housewives may be approached for their choice for a ldquoready to cook productrdquo

2) A publisher might want to find out the reason for poor circulation of newspaper introduced recently He might meet (a) Newspaper sellers (b) Public reading room (c) General public (d) Business community etc

These are experienced persons whose knowledge researcher can use

Focus Group

Another widely used technique in exploratory research is the focus group In a focus group a small number of individuals are brought together to study and talk about some topic of interest The discussion is co-ordinated by a moderator The group usually is of 8-12 persons While selecting these persons care has to be taken to see that they should have a common background and have similar experiences in buying This is required because there should not be a conflict among the group members on the common issues that are being discussed During the discussion future buying attitudes present buying opinion etc are gathered

Most of the companies conducting the focus groups first screen the candidates to determine who will compose the particular group Firms also take care to avoid groups in which some of the participants have their friends and relatives because this leads to a biased discussion Normally a number of such groups are constituted and the final conclusion of various groups are taken for formulating the hypothesis Therefore a key factor in focus group is to have similar groups Normally there are 4-5 groups Some of them may even have 6-8 groups The guiding criteria is to see whether the latter groups are generating additional ideas or repeating the same with respect to the subject under study When this shows a diminishing return from the group the discussions stopped The typical focus group lasts for 1-30 hours to 2 hours The moderator under the focus group has a key role His job is to guide the group to proceed in the right direction

Analysis of selected cases

Analysing a selected case sometimes gives an insight into the problem which is being researched Case histories of companies which have undergone a similar situation may be available These case studies are well suited to carry out exploratory research However the result of investigation of case histories arc always considered suggestive rather than conclusive In case of preference to ldquoready to eat foodrdquo many case histories may be available in the form of previous studies made by competitors We must carefully examine the already published case studies with regard to other variables such as price advertisement changes in the taste etc

II DESCRIPTIVE RESEARCH AND ITrsquoS METHODS

Descriptive research is used to obtain information concerning the current status of the phenomena to describe ldquowhat existsrdquo with respect to variables or conditions in a situation The methods involved range from the survey which describes the status quo the correlation study which investigates the relationship between variables to developmental studies which seek to determine changes over time

Descriptive Research Methods

1 Case Studies

Detailed analysis of a single (or limited number) of people or events Case studies are usually interesting because of the unusualness of the case The major problem with case studies is the problem of objectivity The person who is presenting the case usually has some theoretical orientation It is acceptable for a theoretical orientation to affect onersquos interpretation of events In a case study the theoretical orientation can also lead to the selection of the facts to include in the case It is not surprising that case studies often seem to provide very compelling evidence for a theory Case studies can therefore assist psychology by illustrating how a theory could be applied to a person or events and by assisting with the development of hypotheses for more systematic testing

2 Observational Research

Accounts of the natural behavior of individuals or groups in some setting Unless the observation is unobtrusive there may be some subject reactivity to being observed This often decreases with time a process called habituation Observers cannot usually observe all behaviors all of the time They may use a behavioral checklist and may also use time sampling or event sampling procedures It is important to assess observer bias by the use of interobserver reliability Observational research may also pose ethical problems These can arise when the behaviors being observed are not public behaviors and when the observer joins a group in order to observe the membersrsquo behavior ndash participant observation

3 Survey Research

Structured questions to assess peoples beliefs attitudes and self-reports of behavior If the researcher wishes to generalize the responses to a population it is important to have a representative sample Surveys that rely on self-selection (respond if you are interested) produce non-generalizable results Surveys also provide information for co relational research One can correlate responses to some questions (often demographic questions) with responses to other questions (often attitudes or reports of behavior) Survey question must be clear and unambiguous Even if the questions are unambiguous and non-leading people may display a social desirability bias and give positive or socially acceptable and desirable answers Survey methods include (1) the interview or face-to-face method which is generally viewed as the best method for obtaining a high rate of responses but is also very costly (2) phone surveys which are less expensive but have a higher non-response rate (which has probably increased with caller ID) and (3) written or mail surveys which are least expensive but have a very high non-response rate Follow-up messages can help increase the response rate

4 Archival Research

Analysis of pre-existing data or records Archival research often involves content analysis a qualitative analysis of material For example one would use content analysis to determine whether there had been an increase in the frequency with which women and minorities were mentioned in US history books between 1920 and 2000 Some archival research is quasi-experimental

III EXPERIMENTAL RESEARCH AND ITrsquoS STAGES

Science revolves around experiments and learning the best way of conducting an experiment is crucial to obtaining useful and valid results When scientists speak of experiments in the strictest sense of the word they mean a true experiment where the scientist controls all of the factors and conditions Real world observations and case studies should be referred to as observational research rather than experiments For example observing animals in the wild is not a true experiment because it does not isolate and manipulate an independent variable

THE BASIS OF CONDUCTING AN EXPERIMENT

With an experiment the researcher is trying to learn something new about the world an explanation of lsquowhyrsquo something happens The experiment must maintain internal and external validity or the results will be useless When designing an experiment a researcher must follow all of the steps of the scientific method from making sure that the hypothesis is valid and testable to using controls and statistical tests

Whilst all scientists use reasoning operationalization and the steps of the scientific process it is not always a conscious process Experience and practice mean that many scientists follow an instinctive process of conducting an experiment the lsquostreamlinedrsquo scientific process Following the basic steps will usually generate valid results but where experiments are complex and expensive it is always advisable to follow the rigorous scientific protocols

Conducting a experiment has a number of stages where the parameters and structure of the experiment are made clear Whilst it is rarely practical to follow each step strictly any aberrations must be justified whether they arise because of budget impracticality or ethics

STAGE ONE

After deciding upon a hypothesis and making predictions the first stage of conducting an experiment is to specify the sample groups These should be large enough to give a statistically viable study but small enough to be practical Ideally groups should be selected at random from a wide selection of the sample population This allows results to be generalized to the population as a whole In the physical sciences this is fairly easy but the biological and behavioral sciences are often limited by other factors

For example medical trials often cannot find random groups Such research often relies upon volunteers so it is difficult to apply any realistic randomization This is not a problem as long as the process is justified and the results are not applied to the population as a whole If a psychological researcher used volunteers who were male students aged between 18 and 24 the findings can only be generalized to that specific demographic group within society

STAGE TWO

The sample groups should be divided into a control group and a test group to reduce the possibility of confounding variables This again should be random and the assigning of subjects to groups should be blind or double blind This will reduce the chances of experimental error or bias when conducting an experiment

Ethics are often a barrier to this process because deliberately withholding treatment is not permitted Again any deviations from this process must be explained in the conclusion There is nothing wrong with compromising upon randomness where necessary as long as other scientists are aware of how and why the researcher selected groups on that basis

STAGE THREE

This stage of conducting an experiment involves determining the time scale and frequency of sampling to fit the type of experiment For example researchers studying the effectiveness of a cure for colds would take frequent samples over a period of days Researchers testing a cure for Parkinsonrsquos disease would use less frequent tests over a period of months or years

STAGE FOUR

The penultimate stage of the experiment involves performing the experiment according to the methods stipulated during the design phase The independent variable is manipulated generating a usable data set for the dependent variable

STAGE FIVE

The raw data from the results should be gathered and analyzed by statistical means This allows the researcher to establish if there is any relationship between the variables and accept or reject the null hypothesis

These steps are essential to providing excellent results Whilst many researchers do not want to become involved in the exact processes of inductive reasoning deductive reasoning and operationalization they all follow the basic steps of conducting an experiment This ensures that their results are valid

Step 1 Defining the Problem and Research Objectives

The marketing manager and the researcher must work closely together to define the problemcarefully and agree on the research objectives Marketing managers must know enough aboutmarketing research to help in the planning and to interpret research results Defining the problemand research objectives is often the hardest step in the process After the problem has been definedcarefully the manager and researcher must set the research objectives The three general types ofobjectives are1) Exploratory research where the objective is to gather preliminary information thatwill help to better define problems and suggest hypotheses for their solution2) Descriptive research is where the intent is to describe things such as the marketpotential for a product or the demographics and attitudes of customers who buy the product3) Casual research is research to test hypotheses about cause-and-effect relationshipsThe statement of the problem and research objectives will guide the entire research process It isalways best to put the problem and research objectives statements in writing so agreement can bereached and everyone knows the direction of the research effort

Step 2 Developing the Research Plan

In developing the research plan the attempt is to determine the information needed (outlinesources of secondary data) develop a plan for gathering it efficiently and presenting the plan tomarketing management The plan spells out specific research approaches contact methodssampling plans and instruments that researchers will use to gather new data The firm shouldknow what data already exists before the process of collecting new data begins The steps thatshould be followed are Developing the research plan involves all of the following1 Determining Specific Information Needs2 Gathering Secondary Information3 Planning Primary Data Collection

1) Determine specific information needs

In this step research objectives are translatedinto specific information needs For example determine the demographic economic and lifestylecharacteristics of a target audience

2) Gathering secondary information

a) Secondary data is information that already exists somewhere having beencollected for another purpose Sources of secondary data include both internal and externalsources Companies can buy secondary data reports from outside suppliers (ie commercial datasources)Information can be obtained by using commercial online databases Examples includeCompuServe Dialog and Lexis-Nexus Many of these sources are free Advantages of secondarydata include1 It can usually be obtained more quickly and at a lower cost than primary data2 Sometimes data can be provided that an individual company could not collect on its own

Some problems with collecting secondary data include1 The needed information might not exist2 Even if the data is found it might not be useable3 The researcher must evaluate secondary information to make certain it is relevantaccurate current and impartial Secondary data is a good starting point however the company willoften have to collect primary datab) Primary data is information collected for the specific purpose at hand

Planning Primary Data Collection

A plan for primary data collection calls for a number ofdecisions on research approaches contact methods sampling plans and research instruments

Research Approaches

a) Research approaches can be listed as

1 Observational research

where information is gained by observing relevantpeople actions and situations However some things such as feelingsattitudes motives and private behavior cannot be observed Mechanicalobservation can be obtained through single source data systems This iswhere electronic monitoring systems link consumersrsquo exposure to televisionadvertising and promotion (measured using television meters) with what theybuy in stores (measured using store checkout scanners) Observationalresearch can be used to obtain information that people are unwilling orunable to provide

2 Survey research

is the gathering of primary data by asking people questionsabout their knowledge attitudes preferences and buying behavior Survey research is best suitedfor gathering descriptive information Survey research is the most widely used form of primarydata collection The major advantage of this approach is flexibility while the disadvantages includethe respondent being unwilling to respond giving inaccurate answers or unwilling to spend thetime to answer

3 Experimental research

involves the gathering of primary data by selectingmatched groups of subjects giving them different treatments controlling related factors andchecking for differences in-group responses This form of research tries to explain cause-andeffectrelationships Observation and surveys may be used to collect information in experimentalresearch This form is best used for causal information

In last Lesson we discussed the marketing research process first two steps were discussed in thatLesson today we will continue the same topic and will be discussing the remaining steps of themarketing research process Second topic of todayrsquos Lesson is an introduction to the consumer

behaviorSo our todayrsquos topics are

A THE MARKETING RESEARCH PROCESS (Continued)

B CONSUMER MARKET

Contact Methods

Contact methods are used to obtain the information Contact methods can be listed as1 Mail questionnaires--used to collect large amounts of information at a low cost2 Telephone interviewing--good method for collecting information quickly3 Personal interviewing (which can be either individual or group interviewing)A form of personal interviewing is ldquofocus group interviewingrdquoFocus-group interviewing consists of inviting six to ten people to gather for a few hours with atrained interviewer to talk about a product service or organization The interviewer ldquofocusesrdquothe group discussion on important issues4 Online (Internet) marketing research can consist of Internet surveys or online focus groupsMany experts predict that online research will soon be the primary tool of marketing researchers5 Computer interviewing is a new method being used in the technology age Consumers readquestions from a computer screen and respondSampling plans are used to outline how samples will be constructed and used1 A sample is a segment of the population selected for marketing research to represent thepopulation as a whole2 Marketing researchers usually draw conclusions about large groups of consumers bystudying a small sample of the total consumer population3 Designing a sample calls for three decisionsa Who is to be surveyed (what sampling unit)b How many people should be surveyed (what sample size)c How should the sample be chosen (what sampling procedure)4 Kinds of samples includea Probability samples--each population member has a known chance of beingincluded in the sample and researchers can calculate confidence limits for samplingerrorb Nonprobability samples--sampling error cannot be measuredResearch InstrumentsIn collecting primary data marketing researchers have a choice of two main researchinstrumentsmdashthe questionnaire and mechanical devices The questionnaire is by far the mostcommon instrument whether administered in person by phone or online Questionnaires are veryflexiblemdashthere are many ways to ask questions However they must be developed carefully andtested before they can be used on a large scale A carelessly prepared questionnaire usually containsseveral errors In preparing a questionnaire the marketing researcher must first decide what questions to askQuestionnaires frequently leave out questions that should be answered and include questions that

cannot be answered will not be answered or need not be answered Each question should bechecked to see that it contributes to the research objectivesThe form of each question can influence the response Marketing researchers distinguish betweenclosed-end questions and open-end questions Closed-end questions include all the possibleanswers and subjects make choices among them Examples include multiple-choice questions andscale questions Open-end questions allow respondents to answer in their own words Open-endquestions often reveal more than closed-end questions because respondents are not limited in theiranswers Open-end questions are especially useful in exploratory research when the researcher istrying to find out what people think but not measuring how many people think in a certain wayClosed-end questions on the other hand provide answers that are easier to interpret and tabulateResearchers should also use care in the wording and ordering of questions They should usesimple direct unbiased wording Questions should be arranged in a logical order The firstquestion should create interest if possible and difficult or personal questions should be asked lastso that respondents do not become defensiveAlthough questionnaires are the most common research instrument mechanical instruments alsoare used We discussed two mechanical instruments people meters and supermarket scannersearlier in the chapter Another group of mechanical devices measures subjects physical responses

Step 3 Implementing the Research Plan

The researcher next puts the marketing research plan into action This involves collectingprocessing and analyzing the information Data collection can be carried out by the companysmarketing research staff or by outside firms The company keeps more control over the collectionprocess and data quality by using its own staff However outside firms that specialize in datacollection often can do the job more quickly and at a lower costThe data collection phase of the marketing research process is generally the most expensive andthe most subject to error The researcher should watch fieldwork closely to make sure that the planis implemented correctly and to guard against problems with contacting respondents withrespondents who refuse to cooperate or who give biased or dishonest answers and withinterviewers who make mistakes or take shortcuts

Step 4 Interpreting and Reporting the Findings

The final step in the marketing research process is interpreting and reporting the findings Theresearchers should keep from overwhelming managers with numbers and fancy statisticaltechniques Researchers should present important findings that are useful in the major decisionsfaced by management Interpretation should not be left only to researchers Marketing managerswill also have important insights into the problems Interpretation is an important phase of themarketing process The best research is meaningless if the manager blindly accepts wronginterpretations from the researcherThe researcher must now interpret the findings draw conclusions and report them tomanagement The researcher should not try to overwhelm managers with numbers and fancystatistical techniques Rather the researcher should present important findings that are useful inthe major decisions faced by managementHowever interpretation should not be left only to the researchers They are often experts inresearch design and statistics but the marketing manager knows more about the problem and the

decisions that must be made

In many cases findings can be interpreted in different ways anddiscussions between researchers and managers will help point to the best interpretations Themanager will also want to check that the research project was carried out properly and that all thenecessary analysis was completed Or after seeing the findings the manager may have additionalquestions that can be answered through further sifting of the data Finally the manager is the onewho ultimately must decide what action the research suggests The researchers may even make thedata directly available to marketing managers so that they can perform new analyses and test newrelationships on their ownInterpretation is an important phase of the marketing process The best research is meaningless ifthe manager blindly accepts faulty interpretations from the researcher Similarly managers may bebiasedmdashthey might tend to accept research results that show what they expected and to rejectthose that they did not expect or hope for Thus managers and researchers must work togetherclosely when interpreting research results and both must share responsibility for the researchprocess and resulting decisions

RESEARCH DESIGN

Exploratory research and itrsquos methods

Exploratory research is conducted to clarify ambiguous problems Management may have discovered general problems but research is needed to gain better understanding of the dimensions of the problems Exploratory studies provide information to use in analyzing a situation but uncovering conclusive evidence to determine a particular course of action is not the purpose of exploratory research Usually exploratory research is conducted with the expectation that subsequent research will be required to provide conclusive evidence It is a serious mistake to rush into detailed surveys before less expensive and more readily available sources of information have been exhausted

In an organisation considering a program to help employees with childcare needs for example exploratory research with a small number of employees who have children might determine that many of them have spouses who also work and that these employees have positive reactions to the possibility of an on-site child-care program In such a case exploratory research helps to crystallize a problem and identify information needs for future research

Exploratory research methods

The quickest and the cheapest way to formulate a hypothesis in exploratory research is by using any of the four methods

Literature search

Experience survey

Focus group

Analysis of selected cases

Literature Search

This refers to ldquoreferring to a literature to develop a new hypothesisrdquo The literature referred are ndash trade journals professional journals market research finding publications statistical publications etc Example Suppose a problem is ldquoWhy are sales downrdquo This can quickly be analyzed with the help of published data which should indicate ldquowhether the problem is an ldquoindustry problemrdquo or a ldquofirm problemrdquo Three possibilities exist to formulate the hypothesis

The companyrsquos market share has declined but industryrsquos figures are normal

The industry is declining and hence the companyrsquos market share is also declining

The industryrsquos share is going up but the companyrsquos share is declining

If we accept the situation that our companyrsquos sales are down despite the market showing an upward trend then we need to analyse the marketing mix variables

Example 1 A TV manufacturing company feels that its market share is declining whereas the overall television industry is doing very well

Example 2 Due to a trade embargo imposed by a country textiles exports are down and hence sales of a company making garment for exports is on the decline

The above information may be used to pinpoint the reason for declining sales

Experience Survey

In experience surveys it is desirable to talk to persons who are well informed in the area being investigated These people may be company executives or persons outside the organisation Here no questionnaire is required The approach adopted in an experience survey should be highly unstructured so that the respondent can give divergent views Since the idea of using experience survey is to undertake problem formulation and not conclusion probability sample need not be used Those who cannot speak freely should be excluded from the sample

Examples

1) A group of housewives may be approached for their choice for a ldquoready to cook productrdquo

2) A publisher might want to find out the reason for poor circulation of newspaper introduced recently He might meet (a) Newspaper sellers (b) Public reading room (c) General public (d) Business community etc

These are experienced persons whose knowledge researcher can use

Focus Group

Another widely used technique in exploratory research is the focus group In a focus group a small number of individuals are brought together to study and talk about some topic of interest The discussion is co-ordinated by a moderator The group usually is of 8-12 persons While selecting these persons care has to be taken to see that they should have a common background and have similar experiences in buying This is required because there should not be a conflict among the group members on the common issues that are being discussed During the discussion future buying attitudes present buying opinion etc are gathered

Most of the companies conducting the focus groups first screen the candidates to determine who will compose the particular group Firms also take care to avoid groups in which some of the participants have their friends and relatives because this leads to a biased discussion Normally a number of such groups are constituted and the final conclusion of various groups are taken for formulating the hypothesis Therefore a key factor in focus group is to have similar groups Normally there are 4-5 groups Some of them may even have 6-8 groups The guiding criteria is to see whether the latter groups are generating additional ideas or repeating the same with respect to the subject under study When this shows a diminishing return from the group the discussions stopped The typical focus group lasts for 1-30 hours to 2 hours The moderator under the focus group has a key role His job is to guide the group to proceed in the right direction

Analysis of selected cases

Analysing a selected case sometimes gives an insight into the problem which is being researched Case histories of companies which have undergone a similar situation may be available These case studies are well suited to carry out exploratory research However the result of investigation of case histories arc always considered suggestive rather than conclusive In case of preference to ldquoready to eat foodrdquo many case histories may be available in the form of previous studies made by competitors We must carefully examine the already published case studies with regard to other variables such as price advertisement changes in the taste etc

II DESCRIPTIVE RESEARCH AND ITrsquoS METHODS

Descriptive research is used to obtain information concerning the current status of the phenomena to describe ldquowhat existsrdquo with respect to variables or conditions in a situation The methods involved range from the survey which describes the status quo the correlation study which investigates the relationship between variables to developmental studies which seek to determine changes over time

Descriptive Research Methods

1 Case Studies

Detailed analysis of a single (or limited number) of people or events Case studies are usually interesting because of the unusualness of the case The major problem with case studies is the problem of objectivity The person who is presenting the case usually has some theoretical orientation It is acceptable for a theoretical orientation to affect onersquos interpretation of events In a case study the theoretical orientation can also lead to the selection of the facts to include in the case It is not surprising that case studies often seem to provide very compelling evidence for a theory Case studies can therefore assist psychology by illustrating how a theory could be applied to a person or events and by assisting with the development of hypotheses for more systematic testing

2 Observational Research

Accounts of the natural behavior of individuals or groups in some setting Unless the observation is unobtrusive there may be some subject reactivity to being observed This often decreases with time a process called habituation Observers cannot usually observe all behaviors all of the time They may use a behavioral checklist and may also use time sampling or event sampling procedures It is important to assess observer bias by the use of interobserver reliability Observational research may also pose ethical problems These can arise when the behaviors being observed are not public behaviors and when the observer joins a group in order to observe the membersrsquo behavior ndash participant observation

3 Survey Research

Structured questions to assess peoples beliefs attitudes and self-reports of behavior If the researcher wishes to generalize the responses to a population it is important to have a representative sample Surveys that rely on self-selection (respond if you are interested) produce non-generalizable results Surveys also provide information for co relational research One can correlate responses to some questions (often demographic questions) with responses to other questions (often attitudes or reports of behavior) Survey question must be clear and unambiguous Even if the questions are unambiguous and non-leading people may display a social desirability bias and give positive or socially acceptable and desirable answers Survey methods include (1) the interview or face-to-face method which is generally viewed as the best method for obtaining a high rate of responses but is also very costly (2) phone surveys which are less expensive but have a higher non-response rate (which has probably increased with caller ID) and (3) written or mail surveys which are least expensive but have a very high non-response rate Follow-up messages can help increase the response rate

4 Archival Research

Analysis of pre-existing data or records Archival research often involves content analysis a qualitative analysis of material For example one would use content analysis to determine whether there had been an increase in the frequency with which women and minorities were mentioned in US history books between 1920 and 2000 Some archival research is quasi-experimental

III EXPERIMENTAL RESEARCH AND ITrsquoS STAGES

Science revolves around experiments and learning the best way of conducting an experiment is crucial to obtaining useful and valid results When scientists speak of experiments in the strictest sense of the word they mean a true experiment where the scientist controls all of the factors and conditions Real world observations and case studies should be referred to as observational research rather than experiments For example observing animals in the wild is not a true experiment because it does not isolate and manipulate an independent variable

THE BASIS OF CONDUCTING AN EXPERIMENT

With an experiment the researcher is trying to learn something new about the world an explanation of lsquowhyrsquo something happens The experiment must maintain internal and external validity or the results will be useless When designing an experiment a researcher must follow all of the steps of the scientific method from making sure that the hypothesis is valid and testable to using controls and statistical tests

Whilst all scientists use reasoning operationalization and the steps of the scientific process it is not always a conscious process Experience and practice mean that many scientists follow an instinctive process of conducting an experiment the lsquostreamlinedrsquo scientific process Following the basic steps will usually generate valid results but where experiments are complex and expensive it is always advisable to follow the rigorous scientific protocols

Conducting a experiment has a number of stages where the parameters and structure of the experiment are made clear Whilst it is rarely practical to follow each step strictly any aberrations must be justified whether they arise because of budget impracticality or ethics

STAGE ONE

After deciding upon a hypothesis and making predictions the first stage of conducting an experiment is to specify the sample groups These should be large enough to give a statistically viable study but small enough to be practical Ideally groups should be selected at random from a wide selection of the sample population This allows results to be generalized to the population as a whole In the physical sciences this is fairly easy but the biological and behavioral sciences are often limited by other factors

For example medical trials often cannot find random groups Such research often relies upon volunteers so it is difficult to apply any realistic randomization This is not a problem as long as the process is justified and the results are not applied to the population as a whole If a psychological researcher used volunteers who were male students aged between 18 and 24 the findings can only be generalized to that specific demographic group within society

STAGE TWO

The sample groups should be divided into a control group and a test group to reduce the possibility of confounding variables This again should be random and the assigning of subjects to groups should be blind or double blind This will reduce the chances of experimental error or bias when conducting an experiment

Ethics are often a barrier to this process because deliberately withholding treatment is not permitted Again any deviations from this process must be explained in the conclusion There is nothing wrong with compromising upon randomness where necessary as long as other scientists are aware of how and why the researcher selected groups on that basis

STAGE THREE

This stage of conducting an experiment involves determining the time scale and frequency of sampling to fit the type of experiment For example researchers studying the effectiveness of a cure for colds would take frequent samples over a period of days Researchers testing a cure for Parkinsonrsquos disease would use less frequent tests over a period of months or years

STAGE FOUR

The penultimate stage of the experiment involves performing the experiment according to the methods stipulated during the design phase The independent variable is manipulated generating a usable data set for the dependent variable

STAGE FIVE

The raw data from the results should be gathered and analyzed by statistical means This allows the researcher to establish if there is any relationship between the variables and accept or reject the null hypothesis

These steps are essential to providing excellent results Whilst many researchers do not want to become involved in the exact processes of inductive reasoning deductive reasoning and operationalization they all follow the basic steps of conducting an experiment This ensures that their results are valid

Some problems with collecting secondary data include1 The needed information might not exist2 Even if the data is found it might not be useable3 The researcher must evaluate secondary information to make certain it is relevantaccurate current and impartial Secondary data is a good starting point however the company willoften have to collect primary datab) Primary data is information collected for the specific purpose at hand

Planning Primary Data Collection

A plan for primary data collection calls for a number ofdecisions on research approaches contact methods sampling plans and research instruments

Research Approaches

a) Research approaches can be listed as

1 Observational research

where information is gained by observing relevantpeople actions and situations However some things such as feelingsattitudes motives and private behavior cannot be observed Mechanicalobservation can be obtained through single source data systems This iswhere electronic monitoring systems link consumersrsquo exposure to televisionadvertising and promotion (measured using television meters) with what theybuy in stores (measured using store checkout scanners) Observationalresearch can be used to obtain information that people are unwilling orunable to provide

2 Survey research

is the gathering of primary data by asking people questionsabout their knowledge attitudes preferences and buying behavior Survey research is best suitedfor gathering descriptive information Survey research is the most widely used form of primarydata collection The major advantage of this approach is flexibility while the disadvantages includethe respondent being unwilling to respond giving inaccurate answers or unwilling to spend thetime to answer

3 Experimental research

involves the gathering of primary data by selectingmatched groups of subjects giving them different treatments controlling related factors andchecking for differences in-group responses This form of research tries to explain cause-andeffectrelationships Observation and surveys may be used to collect information in experimentalresearch This form is best used for causal information

In last Lesson we discussed the marketing research process first two steps were discussed in thatLesson today we will continue the same topic and will be discussing the remaining steps of themarketing research process Second topic of todayrsquos Lesson is an introduction to the consumer

behaviorSo our todayrsquos topics are

A THE MARKETING RESEARCH PROCESS (Continued)

B CONSUMER MARKET

Contact Methods

Contact methods are used to obtain the information Contact methods can be listed as1 Mail questionnaires--used to collect large amounts of information at a low cost2 Telephone interviewing--good method for collecting information quickly3 Personal interviewing (which can be either individual or group interviewing)A form of personal interviewing is ldquofocus group interviewingrdquoFocus-group interviewing consists of inviting six to ten people to gather for a few hours with atrained interviewer to talk about a product service or organization The interviewer ldquofocusesrdquothe group discussion on important issues4 Online (Internet) marketing research can consist of Internet surveys or online focus groupsMany experts predict that online research will soon be the primary tool of marketing researchers5 Computer interviewing is a new method being used in the technology age Consumers readquestions from a computer screen and respondSampling plans are used to outline how samples will be constructed and used1 A sample is a segment of the population selected for marketing research to represent thepopulation as a whole2 Marketing researchers usually draw conclusions about large groups of consumers bystudying a small sample of the total consumer population3 Designing a sample calls for three decisionsa Who is to be surveyed (what sampling unit)b How many people should be surveyed (what sample size)c How should the sample be chosen (what sampling procedure)4 Kinds of samples includea Probability samples--each population member has a known chance of beingincluded in the sample and researchers can calculate confidence limits for samplingerrorb Nonprobability samples--sampling error cannot be measuredResearch InstrumentsIn collecting primary data marketing researchers have a choice of two main researchinstrumentsmdashthe questionnaire and mechanical devices The questionnaire is by far the mostcommon instrument whether administered in person by phone or online Questionnaires are veryflexiblemdashthere are many ways to ask questions However they must be developed carefully andtested before they can be used on a large scale A carelessly prepared questionnaire usually containsseveral errors In preparing a questionnaire the marketing researcher must first decide what questions to askQuestionnaires frequently leave out questions that should be answered and include questions that

cannot be answered will not be answered or need not be answered Each question should bechecked to see that it contributes to the research objectivesThe form of each question can influence the response Marketing researchers distinguish betweenclosed-end questions and open-end questions Closed-end questions include all the possibleanswers and subjects make choices among them Examples include multiple-choice questions andscale questions Open-end questions allow respondents to answer in their own words Open-endquestions often reveal more than closed-end questions because respondents are not limited in theiranswers Open-end questions are especially useful in exploratory research when the researcher istrying to find out what people think but not measuring how many people think in a certain wayClosed-end questions on the other hand provide answers that are easier to interpret and tabulateResearchers should also use care in the wording and ordering of questions They should usesimple direct unbiased wording Questions should be arranged in a logical order The firstquestion should create interest if possible and difficult or personal questions should be asked lastso that respondents do not become defensiveAlthough questionnaires are the most common research instrument mechanical instruments alsoare used We discussed two mechanical instruments people meters and supermarket scannersearlier in the chapter Another group of mechanical devices measures subjects physical responses

Step 3 Implementing the Research Plan

The researcher next puts the marketing research plan into action This involves collectingprocessing and analyzing the information Data collection can be carried out by the companysmarketing research staff or by outside firms The company keeps more control over the collectionprocess and data quality by using its own staff However outside firms that specialize in datacollection often can do the job more quickly and at a lower costThe data collection phase of the marketing research process is generally the most expensive andthe most subject to error The researcher should watch fieldwork closely to make sure that the planis implemented correctly and to guard against problems with contacting respondents withrespondents who refuse to cooperate or who give biased or dishonest answers and withinterviewers who make mistakes or take shortcuts

Step 4 Interpreting and Reporting the Findings

The final step in the marketing research process is interpreting and reporting the findings Theresearchers should keep from overwhelming managers with numbers and fancy statisticaltechniques Researchers should present important findings that are useful in the major decisionsfaced by management Interpretation should not be left only to researchers Marketing managerswill also have important insights into the problems Interpretation is an important phase of themarketing process The best research is meaningless if the manager blindly accepts wronginterpretations from the researcherThe researcher must now interpret the findings draw conclusions and report them tomanagement The researcher should not try to overwhelm managers with numbers and fancystatistical techniques Rather the researcher should present important findings that are useful inthe major decisions faced by managementHowever interpretation should not be left only to the researchers They are often experts inresearch design and statistics but the marketing manager knows more about the problem and the

decisions that must be made

In many cases findings can be interpreted in different ways anddiscussions between researchers and managers will help point to the best interpretations Themanager will also want to check that the research project was carried out properly and that all thenecessary analysis was completed Or after seeing the findings the manager may have additionalquestions that can be answered through further sifting of the data Finally the manager is the onewho ultimately must decide what action the research suggests The researchers may even make thedata directly available to marketing managers so that they can perform new analyses and test newrelationships on their ownInterpretation is an important phase of the marketing process The best research is meaningless ifthe manager blindly accepts faulty interpretations from the researcher Similarly managers may bebiasedmdashthey might tend to accept research results that show what they expected and to rejectthose that they did not expect or hope for Thus managers and researchers must work togetherclosely when interpreting research results and both must share responsibility for the researchprocess and resulting decisions

RESEARCH DESIGN

Exploratory research and itrsquos methods

Exploratory research is conducted to clarify ambiguous problems Management may have discovered general problems but research is needed to gain better understanding of the dimensions of the problems Exploratory studies provide information to use in analyzing a situation but uncovering conclusive evidence to determine a particular course of action is not the purpose of exploratory research Usually exploratory research is conducted with the expectation that subsequent research will be required to provide conclusive evidence It is a serious mistake to rush into detailed surveys before less expensive and more readily available sources of information have been exhausted

In an organisation considering a program to help employees with childcare needs for example exploratory research with a small number of employees who have children might determine that many of them have spouses who also work and that these employees have positive reactions to the possibility of an on-site child-care program In such a case exploratory research helps to crystallize a problem and identify information needs for future research

Exploratory research methods

The quickest and the cheapest way to formulate a hypothesis in exploratory research is by using any of the four methods

Literature search

Experience survey

Focus group

Analysis of selected cases

Literature Search

This refers to ldquoreferring to a literature to develop a new hypothesisrdquo The literature referred are ndash trade journals professional journals market research finding publications statistical publications etc Example Suppose a problem is ldquoWhy are sales downrdquo This can quickly be analyzed with the help of published data which should indicate ldquowhether the problem is an ldquoindustry problemrdquo or a ldquofirm problemrdquo Three possibilities exist to formulate the hypothesis

The companyrsquos market share has declined but industryrsquos figures are normal

The industry is declining and hence the companyrsquos market share is also declining

The industryrsquos share is going up but the companyrsquos share is declining

If we accept the situation that our companyrsquos sales are down despite the market showing an upward trend then we need to analyse the marketing mix variables

Example 1 A TV manufacturing company feels that its market share is declining whereas the overall television industry is doing very well

Example 2 Due to a trade embargo imposed by a country textiles exports are down and hence sales of a company making garment for exports is on the decline

The above information may be used to pinpoint the reason for declining sales

Experience Survey

In experience surveys it is desirable to talk to persons who are well informed in the area being investigated These people may be company executives or persons outside the organisation Here no questionnaire is required The approach adopted in an experience survey should be highly unstructured so that the respondent can give divergent views Since the idea of using experience survey is to undertake problem formulation and not conclusion probability sample need not be used Those who cannot speak freely should be excluded from the sample

Examples

1) A group of housewives may be approached for their choice for a ldquoready to cook productrdquo

2) A publisher might want to find out the reason for poor circulation of newspaper introduced recently He might meet (a) Newspaper sellers (b) Public reading room (c) General public (d) Business community etc

These are experienced persons whose knowledge researcher can use

Focus Group

Another widely used technique in exploratory research is the focus group In a focus group a small number of individuals are brought together to study and talk about some topic of interest The discussion is co-ordinated by a moderator The group usually is of 8-12 persons While selecting these persons care has to be taken to see that they should have a common background and have similar experiences in buying This is required because there should not be a conflict among the group members on the common issues that are being discussed During the discussion future buying attitudes present buying opinion etc are gathered

Most of the companies conducting the focus groups first screen the candidates to determine who will compose the particular group Firms also take care to avoid groups in which some of the participants have their friends and relatives because this leads to a biased discussion Normally a number of such groups are constituted and the final conclusion of various groups are taken for formulating the hypothesis Therefore a key factor in focus group is to have similar groups Normally there are 4-5 groups Some of them may even have 6-8 groups The guiding criteria is to see whether the latter groups are generating additional ideas or repeating the same with respect to the subject under study When this shows a diminishing return from the group the discussions stopped The typical focus group lasts for 1-30 hours to 2 hours The moderator under the focus group has a key role His job is to guide the group to proceed in the right direction

Analysis of selected cases

Analysing a selected case sometimes gives an insight into the problem which is being researched Case histories of companies which have undergone a similar situation may be available These case studies are well suited to carry out exploratory research However the result of investigation of case histories arc always considered suggestive rather than conclusive In case of preference to ldquoready to eat foodrdquo many case histories may be available in the form of previous studies made by competitors We must carefully examine the already published case studies with regard to other variables such as price advertisement changes in the taste etc

II DESCRIPTIVE RESEARCH AND ITrsquoS METHODS

Descriptive research is used to obtain information concerning the current status of the phenomena to describe ldquowhat existsrdquo with respect to variables or conditions in a situation The methods involved range from the survey which describes the status quo the correlation study which investigates the relationship between variables to developmental studies which seek to determine changes over time

Descriptive Research Methods

1 Case Studies

Detailed analysis of a single (or limited number) of people or events Case studies are usually interesting because of the unusualness of the case The major problem with case studies is the problem of objectivity The person who is presenting the case usually has some theoretical orientation It is acceptable for a theoretical orientation to affect onersquos interpretation of events In a case study the theoretical orientation can also lead to the selection of the facts to include in the case It is not surprising that case studies often seem to provide very compelling evidence for a theory Case studies can therefore assist psychology by illustrating how a theory could be applied to a person or events and by assisting with the development of hypotheses for more systematic testing

2 Observational Research

Accounts of the natural behavior of individuals or groups in some setting Unless the observation is unobtrusive there may be some subject reactivity to being observed This often decreases with time a process called habituation Observers cannot usually observe all behaviors all of the time They may use a behavioral checklist and may also use time sampling or event sampling procedures It is important to assess observer bias by the use of interobserver reliability Observational research may also pose ethical problems These can arise when the behaviors being observed are not public behaviors and when the observer joins a group in order to observe the membersrsquo behavior ndash participant observation

3 Survey Research

Structured questions to assess peoples beliefs attitudes and self-reports of behavior If the researcher wishes to generalize the responses to a population it is important to have a representative sample Surveys that rely on self-selection (respond if you are interested) produce non-generalizable results Surveys also provide information for co relational research One can correlate responses to some questions (often demographic questions) with responses to other questions (often attitudes or reports of behavior) Survey question must be clear and unambiguous Even if the questions are unambiguous and non-leading people may display a social desirability bias and give positive or socially acceptable and desirable answers Survey methods include (1) the interview or face-to-face method which is generally viewed as the best method for obtaining a high rate of responses but is also very costly (2) phone surveys which are less expensive but have a higher non-response rate (which has probably increased with caller ID) and (3) written or mail surveys which are least expensive but have a very high non-response rate Follow-up messages can help increase the response rate

4 Archival Research

Analysis of pre-existing data or records Archival research often involves content analysis a qualitative analysis of material For example one would use content analysis to determine whether there had been an increase in the frequency with which women and minorities were mentioned in US history books between 1920 and 2000 Some archival research is quasi-experimental

III EXPERIMENTAL RESEARCH AND ITrsquoS STAGES

Science revolves around experiments and learning the best way of conducting an experiment is crucial to obtaining useful and valid results When scientists speak of experiments in the strictest sense of the word they mean a true experiment where the scientist controls all of the factors and conditions Real world observations and case studies should be referred to as observational research rather than experiments For example observing animals in the wild is not a true experiment because it does not isolate and manipulate an independent variable

THE BASIS OF CONDUCTING AN EXPERIMENT

With an experiment the researcher is trying to learn something new about the world an explanation of lsquowhyrsquo something happens The experiment must maintain internal and external validity or the results will be useless When designing an experiment a researcher must follow all of the steps of the scientific method from making sure that the hypothesis is valid and testable to using controls and statistical tests

Whilst all scientists use reasoning operationalization and the steps of the scientific process it is not always a conscious process Experience and practice mean that many scientists follow an instinctive process of conducting an experiment the lsquostreamlinedrsquo scientific process Following the basic steps will usually generate valid results but where experiments are complex and expensive it is always advisable to follow the rigorous scientific protocols

Conducting a experiment has a number of stages where the parameters and structure of the experiment are made clear Whilst it is rarely practical to follow each step strictly any aberrations must be justified whether they arise because of budget impracticality or ethics

STAGE ONE

After deciding upon a hypothesis and making predictions the first stage of conducting an experiment is to specify the sample groups These should be large enough to give a statistically viable study but small enough to be practical Ideally groups should be selected at random from a wide selection of the sample population This allows results to be generalized to the population as a whole In the physical sciences this is fairly easy but the biological and behavioral sciences are often limited by other factors

For example medical trials often cannot find random groups Such research often relies upon volunteers so it is difficult to apply any realistic randomization This is not a problem as long as the process is justified and the results are not applied to the population as a whole If a psychological researcher used volunteers who were male students aged between 18 and 24 the findings can only be generalized to that specific demographic group within society

STAGE TWO

The sample groups should be divided into a control group and a test group to reduce the possibility of confounding variables This again should be random and the assigning of subjects to groups should be blind or double blind This will reduce the chances of experimental error or bias when conducting an experiment

Ethics are often a barrier to this process because deliberately withholding treatment is not permitted Again any deviations from this process must be explained in the conclusion There is nothing wrong with compromising upon randomness where necessary as long as other scientists are aware of how and why the researcher selected groups on that basis

STAGE THREE

This stage of conducting an experiment involves determining the time scale and frequency of sampling to fit the type of experiment For example researchers studying the effectiveness of a cure for colds would take frequent samples over a period of days Researchers testing a cure for Parkinsonrsquos disease would use less frequent tests over a period of months or years

STAGE FOUR

The penultimate stage of the experiment involves performing the experiment according to the methods stipulated during the design phase The independent variable is manipulated generating a usable data set for the dependent variable

STAGE FIVE

The raw data from the results should be gathered and analyzed by statistical means This allows the researcher to establish if there is any relationship between the variables and accept or reject the null hypothesis

These steps are essential to providing excellent results Whilst many researchers do not want to become involved in the exact processes of inductive reasoning deductive reasoning and operationalization they all follow the basic steps of conducting an experiment This ensures that their results are valid

behaviorSo our todayrsquos topics are

A THE MARKETING RESEARCH PROCESS (Continued)

B CONSUMER MARKET

Contact Methods

Contact methods are used to obtain the information Contact methods can be listed as1 Mail questionnaires--used to collect large amounts of information at a low cost2 Telephone interviewing--good method for collecting information quickly3 Personal interviewing (which can be either individual or group interviewing)A form of personal interviewing is ldquofocus group interviewingrdquoFocus-group interviewing consists of inviting six to ten people to gather for a few hours with atrained interviewer to talk about a product service or organization The interviewer ldquofocusesrdquothe group discussion on important issues4 Online (Internet) marketing research can consist of Internet surveys or online focus groupsMany experts predict that online research will soon be the primary tool of marketing researchers5 Computer interviewing is a new method being used in the technology age Consumers readquestions from a computer screen and respondSampling plans are used to outline how samples will be constructed and used1 A sample is a segment of the population selected for marketing research to represent thepopulation as a whole2 Marketing researchers usually draw conclusions about large groups of consumers bystudying a small sample of the total consumer population3 Designing a sample calls for three decisionsa Who is to be surveyed (what sampling unit)b How many people should be surveyed (what sample size)c How should the sample be chosen (what sampling procedure)4 Kinds of samples includea Probability samples--each population member has a known chance of beingincluded in the sample and researchers can calculate confidence limits for samplingerrorb Nonprobability samples--sampling error cannot be measuredResearch InstrumentsIn collecting primary data marketing researchers have a choice of two main researchinstrumentsmdashthe questionnaire and mechanical devices The questionnaire is by far the mostcommon instrument whether administered in person by phone or online Questionnaires are veryflexiblemdashthere are many ways to ask questions However they must be developed carefully andtested before they can be used on a large scale A carelessly prepared questionnaire usually containsseveral errors In preparing a questionnaire the marketing researcher must first decide what questions to askQuestionnaires frequently leave out questions that should be answered and include questions that

cannot be answered will not be answered or need not be answered Each question should bechecked to see that it contributes to the research objectivesThe form of each question can influence the response Marketing researchers distinguish betweenclosed-end questions and open-end questions Closed-end questions include all the possibleanswers and subjects make choices among them Examples include multiple-choice questions andscale questions Open-end questions allow respondents to answer in their own words Open-endquestions often reveal more than closed-end questions because respondents are not limited in theiranswers Open-end questions are especially useful in exploratory research when the researcher istrying to find out what people think but not measuring how many people think in a certain wayClosed-end questions on the other hand provide answers that are easier to interpret and tabulateResearchers should also use care in the wording and ordering of questions They should usesimple direct unbiased wording Questions should be arranged in a logical order The firstquestion should create interest if possible and difficult or personal questions should be asked lastso that respondents do not become defensiveAlthough questionnaires are the most common research instrument mechanical instruments alsoare used We discussed two mechanical instruments people meters and supermarket scannersearlier in the chapter Another group of mechanical devices measures subjects physical responses

Step 3 Implementing the Research Plan

The researcher next puts the marketing research plan into action This involves collectingprocessing and analyzing the information Data collection can be carried out by the companysmarketing research staff or by outside firms The company keeps more control over the collectionprocess and data quality by using its own staff However outside firms that specialize in datacollection often can do the job more quickly and at a lower costThe data collection phase of the marketing research process is generally the most expensive andthe most subject to error The researcher should watch fieldwork closely to make sure that the planis implemented correctly and to guard against problems with contacting respondents withrespondents who refuse to cooperate or who give biased or dishonest answers and withinterviewers who make mistakes or take shortcuts

Step 4 Interpreting and Reporting the Findings

The final step in the marketing research process is interpreting and reporting the findings Theresearchers should keep from overwhelming managers with numbers and fancy statisticaltechniques Researchers should present important findings that are useful in the major decisionsfaced by management Interpretation should not be left only to researchers Marketing managerswill also have important insights into the problems Interpretation is an important phase of themarketing process The best research is meaningless if the manager blindly accepts wronginterpretations from the researcherThe researcher must now interpret the findings draw conclusions and report them tomanagement The researcher should not try to overwhelm managers with numbers and fancystatistical techniques Rather the researcher should present important findings that are useful inthe major decisions faced by managementHowever interpretation should not be left only to the researchers They are often experts inresearch design and statistics but the marketing manager knows more about the problem and the

decisions that must be made

In many cases findings can be interpreted in different ways anddiscussions between researchers and managers will help point to the best interpretations Themanager will also want to check that the research project was carried out properly and that all thenecessary analysis was completed Or after seeing the findings the manager may have additionalquestions that can be answered through further sifting of the data Finally the manager is the onewho ultimately must decide what action the research suggests The researchers may even make thedata directly available to marketing managers so that they can perform new analyses and test newrelationships on their ownInterpretation is an important phase of the marketing process The best research is meaningless ifthe manager blindly accepts faulty interpretations from the researcher Similarly managers may bebiasedmdashthey might tend to accept research results that show what they expected and to rejectthose that they did not expect or hope for Thus managers and researchers must work togetherclosely when interpreting research results and both must share responsibility for the researchprocess and resulting decisions

RESEARCH DESIGN

Exploratory research and itrsquos methods

Exploratory research is conducted to clarify ambiguous problems Management may have discovered general problems but research is needed to gain better understanding of the dimensions of the problems Exploratory studies provide information to use in analyzing a situation but uncovering conclusive evidence to determine a particular course of action is not the purpose of exploratory research Usually exploratory research is conducted with the expectation that subsequent research will be required to provide conclusive evidence It is a serious mistake to rush into detailed surveys before less expensive and more readily available sources of information have been exhausted

In an organisation considering a program to help employees with childcare needs for example exploratory research with a small number of employees who have children might determine that many of them have spouses who also work and that these employees have positive reactions to the possibility of an on-site child-care program In such a case exploratory research helps to crystallize a problem and identify information needs for future research

Exploratory research methods

The quickest and the cheapest way to formulate a hypothesis in exploratory research is by using any of the four methods

Literature search

Experience survey

Focus group

Analysis of selected cases

Literature Search

This refers to ldquoreferring to a literature to develop a new hypothesisrdquo The literature referred are ndash trade journals professional journals market research finding publications statistical publications etc Example Suppose a problem is ldquoWhy are sales downrdquo This can quickly be analyzed with the help of published data which should indicate ldquowhether the problem is an ldquoindustry problemrdquo or a ldquofirm problemrdquo Three possibilities exist to formulate the hypothesis

The companyrsquos market share has declined but industryrsquos figures are normal

The industry is declining and hence the companyrsquos market share is also declining

The industryrsquos share is going up but the companyrsquos share is declining

If we accept the situation that our companyrsquos sales are down despite the market showing an upward trend then we need to analyse the marketing mix variables

Example 1 A TV manufacturing company feels that its market share is declining whereas the overall television industry is doing very well

Example 2 Due to a trade embargo imposed by a country textiles exports are down and hence sales of a company making garment for exports is on the decline

The above information may be used to pinpoint the reason for declining sales

Experience Survey

In experience surveys it is desirable to talk to persons who are well informed in the area being investigated These people may be company executives or persons outside the organisation Here no questionnaire is required The approach adopted in an experience survey should be highly unstructured so that the respondent can give divergent views Since the idea of using experience survey is to undertake problem formulation and not conclusion probability sample need not be used Those who cannot speak freely should be excluded from the sample

Examples

1) A group of housewives may be approached for their choice for a ldquoready to cook productrdquo

2) A publisher might want to find out the reason for poor circulation of newspaper introduced recently He might meet (a) Newspaper sellers (b) Public reading room (c) General public (d) Business community etc

These are experienced persons whose knowledge researcher can use

Focus Group

Another widely used technique in exploratory research is the focus group In a focus group a small number of individuals are brought together to study and talk about some topic of interest The discussion is co-ordinated by a moderator The group usually is of 8-12 persons While selecting these persons care has to be taken to see that they should have a common background and have similar experiences in buying This is required because there should not be a conflict among the group members on the common issues that are being discussed During the discussion future buying attitudes present buying opinion etc are gathered

Most of the companies conducting the focus groups first screen the candidates to determine who will compose the particular group Firms also take care to avoid groups in which some of the participants have their friends and relatives because this leads to a biased discussion Normally a number of such groups are constituted and the final conclusion of various groups are taken for formulating the hypothesis Therefore a key factor in focus group is to have similar groups Normally there are 4-5 groups Some of them may even have 6-8 groups The guiding criteria is to see whether the latter groups are generating additional ideas or repeating the same with respect to the subject under study When this shows a diminishing return from the group the discussions stopped The typical focus group lasts for 1-30 hours to 2 hours The moderator under the focus group has a key role His job is to guide the group to proceed in the right direction

Analysis of selected cases

Analysing a selected case sometimes gives an insight into the problem which is being researched Case histories of companies which have undergone a similar situation may be available These case studies are well suited to carry out exploratory research However the result of investigation of case histories arc always considered suggestive rather than conclusive In case of preference to ldquoready to eat foodrdquo many case histories may be available in the form of previous studies made by competitors We must carefully examine the already published case studies with regard to other variables such as price advertisement changes in the taste etc

II DESCRIPTIVE RESEARCH AND ITrsquoS METHODS

Descriptive research is used to obtain information concerning the current status of the phenomena to describe ldquowhat existsrdquo with respect to variables or conditions in a situation The methods involved range from the survey which describes the status quo the correlation study which investigates the relationship between variables to developmental studies which seek to determine changes over time

Descriptive Research Methods

1 Case Studies

Detailed analysis of a single (or limited number) of people or events Case studies are usually interesting because of the unusualness of the case The major problem with case studies is the problem of objectivity The person who is presenting the case usually has some theoretical orientation It is acceptable for a theoretical orientation to affect onersquos interpretation of events In a case study the theoretical orientation can also lead to the selection of the facts to include in the case It is not surprising that case studies often seem to provide very compelling evidence for a theory Case studies can therefore assist psychology by illustrating how a theory could be applied to a person or events and by assisting with the development of hypotheses for more systematic testing

2 Observational Research

Accounts of the natural behavior of individuals or groups in some setting Unless the observation is unobtrusive there may be some subject reactivity to being observed This often decreases with time a process called habituation Observers cannot usually observe all behaviors all of the time They may use a behavioral checklist and may also use time sampling or event sampling procedures It is important to assess observer bias by the use of interobserver reliability Observational research may also pose ethical problems These can arise when the behaviors being observed are not public behaviors and when the observer joins a group in order to observe the membersrsquo behavior ndash participant observation

3 Survey Research

Structured questions to assess peoples beliefs attitudes and self-reports of behavior If the researcher wishes to generalize the responses to a population it is important to have a representative sample Surveys that rely on self-selection (respond if you are interested) produce non-generalizable results Surveys also provide information for co relational research One can correlate responses to some questions (often demographic questions) with responses to other questions (often attitudes or reports of behavior) Survey question must be clear and unambiguous Even if the questions are unambiguous and non-leading people may display a social desirability bias and give positive or socially acceptable and desirable answers Survey methods include (1) the interview or face-to-face method which is generally viewed as the best method for obtaining a high rate of responses but is also very costly (2) phone surveys which are less expensive but have a higher non-response rate (which has probably increased with caller ID) and (3) written or mail surveys which are least expensive but have a very high non-response rate Follow-up messages can help increase the response rate

4 Archival Research

Analysis of pre-existing data or records Archival research often involves content analysis a qualitative analysis of material For example one would use content analysis to determine whether there had been an increase in the frequency with which women and minorities were mentioned in US history books between 1920 and 2000 Some archival research is quasi-experimental

III EXPERIMENTAL RESEARCH AND ITrsquoS STAGES

Science revolves around experiments and learning the best way of conducting an experiment is crucial to obtaining useful and valid results When scientists speak of experiments in the strictest sense of the word they mean a true experiment where the scientist controls all of the factors and conditions Real world observations and case studies should be referred to as observational research rather than experiments For example observing animals in the wild is not a true experiment because it does not isolate and manipulate an independent variable

THE BASIS OF CONDUCTING AN EXPERIMENT

With an experiment the researcher is trying to learn something new about the world an explanation of lsquowhyrsquo something happens The experiment must maintain internal and external validity or the results will be useless When designing an experiment a researcher must follow all of the steps of the scientific method from making sure that the hypothesis is valid and testable to using controls and statistical tests

Whilst all scientists use reasoning operationalization and the steps of the scientific process it is not always a conscious process Experience and practice mean that many scientists follow an instinctive process of conducting an experiment the lsquostreamlinedrsquo scientific process Following the basic steps will usually generate valid results but where experiments are complex and expensive it is always advisable to follow the rigorous scientific protocols

Conducting a experiment has a number of stages where the parameters and structure of the experiment are made clear Whilst it is rarely practical to follow each step strictly any aberrations must be justified whether they arise because of budget impracticality or ethics

STAGE ONE

After deciding upon a hypothesis and making predictions the first stage of conducting an experiment is to specify the sample groups These should be large enough to give a statistically viable study but small enough to be practical Ideally groups should be selected at random from a wide selection of the sample population This allows results to be generalized to the population as a whole In the physical sciences this is fairly easy but the biological and behavioral sciences are often limited by other factors

For example medical trials often cannot find random groups Such research often relies upon volunteers so it is difficult to apply any realistic randomization This is not a problem as long as the process is justified and the results are not applied to the population as a whole If a psychological researcher used volunteers who were male students aged between 18 and 24 the findings can only be generalized to that specific demographic group within society

STAGE TWO

The sample groups should be divided into a control group and a test group to reduce the possibility of confounding variables This again should be random and the assigning of subjects to groups should be blind or double blind This will reduce the chances of experimental error or bias when conducting an experiment

Ethics are often a barrier to this process because deliberately withholding treatment is not permitted Again any deviations from this process must be explained in the conclusion There is nothing wrong with compromising upon randomness where necessary as long as other scientists are aware of how and why the researcher selected groups on that basis

STAGE THREE

This stage of conducting an experiment involves determining the time scale and frequency of sampling to fit the type of experiment For example researchers studying the effectiveness of a cure for colds would take frequent samples over a period of days Researchers testing a cure for Parkinsonrsquos disease would use less frequent tests over a period of months or years

STAGE FOUR

The penultimate stage of the experiment involves performing the experiment according to the methods stipulated during the design phase The independent variable is manipulated generating a usable data set for the dependent variable

STAGE FIVE

The raw data from the results should be gathered and analyzed by statistical means This allows the researcher to establish if there is any relationship between the variables and accept or reject the null hypothesis

These steps are essential to providing excellent results Whilst many researchers do not want to become involved in the exact processes of inductive reasoning deductive reasoning and operationalization they all follow the basic steps of conducting an experiment This ensures that their results are valid

cannot be answered will not be answered or need not be answered Each question should bechecked to see that it contributes to the research objectivesThe form of each question can influence the response Marketing researchers distinguish betweenclosed-end questions and open-end questions Closed-end questions include all the possibleanswers and subjects make choices among them Examples include multiple-choice questions andscale questions Open-end questions allow respondents to answer in their own words Open-endquestions often reveal more than closed-end questions because respondents are not limited in theiranswers Open-end questions are especially useful in exploratory research when the researcher istrying to find out what people think but not measuring how many people think in a certain wayClosed-end questions on the other hand provide answers that are easier to interpret and tabulateResearchers should also use care in the wording and ordering of questions They should usesimple direct unbiased wording Questions should be arranged in a logical order The firstquestion should create interest if possible and difficult or personal questions should be asked lastso that respondents do not become defensiveAlthough questionnaires are the most common research instrument mechanical instruments alsoare used We discussed two mechanical instruments people meters and supermarket scannersearlier in the chapter Another group of mechanical devices measures subjects physical responses

Step 3 Implementing the Research Plan

The researcher next puts the marketing research plan into action This involves collectingprocessing and analyzing the information Data collection can be carried out by the companysmarketing research staff or by outside firms The company keeps more control over the collectionprocess and data quality by using its own staff However outside firms that specialize in datacollection often can do the job more quickly and at a lower costThe data collection phase of the marketing research process is generally the most expensive andthe most subject to error The researcher should watch fieldwork closely to make sure that the planis implemented correctly and to guard against problems with contacting respondents withrespondents who refuse to cooperate or who give biased or dishonest answers and withinterviewers who make mistakes or take shortcuts

Step 4 Interpreting and Reporting the Findings

The final step in the marketing research process is interpreting and reporting the findings Theresearchers should keep from overwhelming managers with numbers and fancy statisticaltechniques Researchers should present important findings that are useful in the major decisionsfaced by management Interpretation should not be left only to researchers Marketing managerswill also have important insights into the problems Interpretation is an important phase of themarketing process The best research is meaningless if the manager blindly accepts wronginterpretations from the researcherThe researcher must now interpret the findings draw conclusions and report them tomanagement The researcher should not try to overwhelm managers with numbers and fancystatistical techniques Rather the researcher should present important findings that are useful inthe major decisions faced by managementHowever interpretation should not be left only to the researchers They are often experts inresearch design and statistics but the marketing manager knows more about the problem and the

decisions that must be made

In many cases findings can be interpreted in different ways anddiscussions between researchers and managers will help point to the best interpretations Themanager will also want to check that the research project was carried out properly and that all thenecessary analysis was completed Or after seeing the findings the manager may have additionalquestions that can be answered through further sifting of the data Finally the manager is the onewho ultimately must decide what action the research suggests The researchers may even make thedata directly available to marketing managers so that they can perform new analyses and test newrelationships on their ownInterpretation is an important phase of the marketing process The best research is meaningless ifthe manager blindly accepts faulty interpretations from the researcher Similarly managers may bebiasedmdashthey might tend to accept research results that show what they expected and to rejectthose that they did not expect or hope for Thus managers and researchers must work togetherclosely when interpreting research results and both must share responsibility for the researchprocess and resulting decisions

RESEARCH DESIGN

Exploratory research and itrsquos methods

Exploratory research is conducted to clarify ambiguous problems Management may have discovered general problems but research is needed to gain better understanding of the dimensions of the problems Exploratory studies provide information to use in analyzing a situation but uncovering conclusive evidence to determine a particular course of action is not the purpose of exploratory research Usually exploratory research is conducted with the expectation that subsequent research will be required to provide conclusive evidence It is a serious mistake to rush into detailed surveys before less expensive and more readily available sources of information have been exhausted

In an organisation considering a program to help employees with childcare needs for example exploratory research with a small number of employees who have children might determine that many of them have spouses who also work and that these employees have positive reactions to the possibility of an on-site child-care program In such a case exploratory research helps to crystallize a problem and identify information needs for future research

Exploratory research methods

The quickest and the cheapest way to formulate a hypothesis in exploratory research is by using any of the four methods

Literature search

Experience survey

Focus group

Analysis of selected cases

Literature Search

This refers to ldquoreferring to a literature to develop a new hypothesisrdquo The literature referred are ndash trade journals professional journals market research finding publications statistical publications etc Example Suppose a problem is ldquoWhy are sales downrdquo This can quickly be analyzed with the help of published data which should indicate ldquowhether the problem is an ldquoindustry problemrdquo or a ldquofirm problemrdquo Three possibilities exist to formulate the hypothesis

The companyrsquos market share has declined but industryrsquos figures are normal

The industry is declining and hence the companyrsquos market share is also declining

The industryrsquos share is going up but the companyrsquos share is declining

If we accept the situation that our companyrsquos sales are down despite the market showing an upward trend then we need to analyse the marketing mix variables

Example 1 A TV manufacturing company feels that its market share is declining whereas the overall television industry is doing very well

Example 2 Due to a trade embargo imposed by a country textiles exports are down and hence sales of a company making garment for exports is on the decline

The above information may be used to pinpoint the reason for declining sales

Experience Survey

In experience surveys it is desirable to talk to persons who are well informed in the area being investigated These people may be company executives or persons outside the organisation Here no questionnaire is required The approach adopted in an experience survey should be highly unstructured so that the respondent can give divergent views Since the idea of using experience survey is to undertake problem formulation and not conclusion probability sample need not be used Those who cannot speak freely should be excluded from the sample

Examples

1) A group of housewives may be approached for their choice for a ldquoready to cook productrdquo

2) A publisher might want to find out the reason for poor circulation of newspaper introduced recently He might meet (a) Newspaper sellers (b) Public reading room (c) General public (d) Business community etc

These are experienced persons whose knowledge researcher can use

Focus Group

Another widely used technique in exploratory research is the focus group In a focus group a small number of individuals are brought together to study and talk about some topic of interest The discussion is co-ordinated by a moderator The group usually is of 8-12 persons While selecting these persons care has to be taken to see that they should have a common background and have similar experiences in buying This is required because there should not be a conflict among the group members on the common issues that are being discussed During the discussion future buying attitudes present buying opinion etc are gathered

Most of the companies conducting the focus groups first screen the candidates to determine who will compose the particular group Firms also take care to avoid groups in which some of the participants have their friends and relatives because this leads to a biased discussion Normally a number of such groups are constituted and the final conclusion of various groups are taken for formulating the hypothesis Therefore a key factor in focus group is to have similar groups Normally there are 4-5 groups Some of them may even have 6-8 groups The guiding criteria is to see whether the latter groups are generating additional ideas or repeating the same with respect to the subject under study When this shows a diminishing return from the group the discussions stopped The typical focus group lasts for 1-30 hours to 2 hours The moderator under the focus group has a key role His job is to guide the group to proceed in the right direction

Analysis of selected cases

Analysing a selected case sometimes gives an insight into the problem which is being researched Case histories of companies which have undergone a similar situation may be available These case studies are well suited to carry out exploratory research However the result of investigation of case histories arc always considered suggestive rather than conclusive In case of preference to ldquoready to eat foodrdquo many case histories may be available in the form of previous studies made by competitors We must carefully examine the already published case studies with regard to other variables such as price advertisement changes in the taste etc

II DESCRIPTIVE RESEARCH AND ITrsquoS METHODS

Descriptive research is used to obtain information concerning the current status of the phenomena to describe ldquowhat existsrdquo with respect to variables or conditions in a situation The methods involved range from the survey which describes the status quo the correlation study which investigates the relationship between variables to developmental studies which seek to determine changes over time

Descriptive Research Methods

1 Case Studies

Detailed analysis of a single (or limited number) of people or events Case studies are usually interesting because of the unusualness of the case The major problem with case studies is the problem of objectivity The person who is presenting the case usually has some theoretical orientation It is acceptable for a theoretical orientation to affect onersquos interpretation of events In a case study the theoretical orientation can also lead to the selection of the facts to include in the case It is not surprising that case studies often seem to provide very compelling evidence for a theory Case studies can therefore assist psychology by illustrating how a theory could be applied to a person or events and by assisting with the development of hypotheses for more systematic testing

2 Observational Research

Accounts of the natural behavior of individuals or groups in some setting Unless the observation is unobtrusive there may be some subject reactivity to being observed This often decreases with time a process called habituation Observers cannot usually observe all behaviors all of the time They may use a behavioral checklist and may also use time sampling or event sampling procedures It is important to assess observer bias by the use of interobserver reliability Observational research may also pose ethical problems These can arise when the behaviors being observed are not public behaviors and when the observer joins a group in order to observe the membersrsquo behavior ndash participant observation

3 Survey Research

Structured questions to assess peoples beliefs attitudes and self-reports of behavior If the researcher wishes to generalize the responses to a population it is important to have a representative sample Surveys that rely on self-selection (respond if you are interested) produce non-generalizable results Surveys also provide information for co relational research One can correlate responses to some questions (often demographic questions) with responses to other questions (often attitudes or reports of behavior) Survey question must be clear and unambiguous Even if the questions are unambiguous and non-leading people may display a social desirability bias and give positive or socially acceptable and desirable answers Survey methods include (1) the interview or face-to-face method which is generally viewed as the best method for obtaining a high rate of responses but is also very costly (2) phone surveys which are less expensive but have a higher non-response rate (which has probably increased with caller ID) and (3) written or mail surveys which are least expensive but have a very high non-response rate Follow-up messages can help increase the response rate

4 Archival Research

Analysis of pre-existing data or records Archival research often involves content analysis a qualitative analysis of material For example one would use content analysis to determine whether there had been an increase in the frequency with which women and minorities were mentioned in US history books between 1920 and 2000 Some archival research is quasi-experimental

III EXPERIMENTAL RESEARCH AND ITrsquoS STAGES

Science revolves around experiments and learning the best way of conducting an experiment is crucial to obtaining useful and valid results When scientists speak of experiments in the strictest sense of the word they mean a true experiment where the scientist controls all of the factors and conditions Real world observations and case studies should be referred to as observational research rather than experiments For example observing animals in the wild is not a true experiment because it does not isolate and manipulate an independent variable

THE BASIS OF CONDUCTING AN EXPERIMENT

With an experiment the researcher is trying to learn something new about the world an explanation of lsquowhyrsquo something happens The experiment must maintain internal and external validity or the results will be useless When designing an experiment a researcher must follow all of the steps of the scientific method from making sure that the hypothesis is valid and testable to using controls and statistical tests

Whilst all scientists use reasoning operationalization and the steps of the scientific process it is not always a conscious process Experience and practice mean that many scientists follow an instinctive process of conducting an experiment the lsquostreamlinedrsquo scientific process Following the basic steps will usually generate valid results but where experiments are complex and expensive it is always advisable to follow the rigorous scientific protocols

Conducting a experiment has a number of stages where the parameters and structure of the experiment are made clear Whilst it is rarely practical to follow each step strictly any aberrations must be justified whether they arise because of budget impracticality or ethics

STAGE ONE

After deciding upon a hypothesis and making predictions the first stage of conducting an experiment is to specify the sample groups These should be large enough to give a statistically viable study but small enough to be practical Ideally groups should be selected at random from a wide selection of the sample population This allows results to be generalized to the population as a whole In the physical sciences this is fairly easy but the biological and behavioral sciences are often limited by other factors

For example medical trials often cannot find random groups Such research often relies upon volunteers so it is difficult to apply any realistic randomization This is not a problem as long as the process is justified and the results are not applied to the population as a whole If a psychological researcher used volunteers who were male students aged between 18 and 24 the findings can only be generalized to that specific demographic group within society

STAGE TWO

The sample groups should be divided into a control group and a test group to reduce the possibility of confounding variables This again should be random and the assigning of subjects to groups should be blind or double blind This will reduce the chances of experimental error or bias when conducting an experiment

Ethics are often a barrier to this process because deliberately withholding treatment is not permitted Again any deviations from this process must be explained in the conclusion There is nothing wrong with compromising upon randomness where necessary as long as other scientists are aware of how and why the researcher selected groups on that basis

STAGE THREE

This stage of conducting an experiment involves determining the time scale and frequency of sampling to fit the type of experiment For example researchers studying the effectiveness of a cure for colds would take frequent samples over a period of days Researchers testing a cure for Parkinsonrsquos disease would use less frequent tests over a period of months or years

STAGE FOUR

The penultimate stage of the experiment involves performing the experiment according to the methods stipulated during the design phase The independent variable is manipulated generating a usable data set for the dependent variable

STAGE FIVE

The raw data from the results should be gathered and analyzed by statistical means This allows the researcher to establish if there is any relationship between the variables and accept or reject the null hypothesis

These steps are essential to providing excellent results Whilst many researchers do not want to become involved in the exact processes of inductive reasoning deductive reasoning and operationalization they all follow the basic steps of conducting an experiment This ensures that their results are valid

decisions that must be made

In many cases findings can be interpreted in different ways anddiscussions between researchers and managers will help point to the best interpretations Themanager will also want to check that the research project was carried out properly and that all thenecessary analysis was completed Or after seeing the findings the manager may have additionalquestions that can be answered through further sifting of the data Finally the manager is the onewho ultimately must decide what action the research suggests The researchers may even make thedata directly available to marketing managers so that they can perform new analyses and test newrelationships on their ownInterpretation is an important phase of the marketing process The best research is meaningless ifthe manager blindly accepts faulty interpretations from the researcher Similarly managers may bebiasedmdashthey might tend to accept research results that show what they expected and to rejectthose that they did not expect or hope for Thus managers and researchers must work togetherclosely when interpreting research results and both must share responsibility for the researchprocess and resulting decisions

RESEARCH DESIGN

Exploratory research and itrsquos methods

Exploratory research is conducted to clarify ambiguous problems Management may have discovered general problems but research is needed to gain better understanding of the dimensions of the problems Exploratory studies provide information to use in analyzing a situation but uncovering conclusive evidence to determine a particular course of action is not the purpose of exploratory research Usually exploratory research is conducted with the expectation that subsequent research will be required to provide conclusive evidence It is a serious mistake to rush into detailed surveys before less expensive and more readily available sources of information have been exhausted

In an organisation considering a program to help employees with childcare needs for example exploratory research with a small number of employees who have children might determine that many of them have spouses who also work and that these employees have positive reactions to the possibility of an on-site child-care program In such a case exploratory research helps to crystallize a problem and identify information needs for future research

Exploratory research methods

The quickest and the cheapest way to formulate a hypothesis in exploratory research is by using any of the four methods

Literature search

Experience survey

Focus group

Analysis of selected cases

Literature Search

This refers to ldquoreferring to a literature to develop a new hypothesisrdquo The literature referred are ndash trade journals professional journals market research finding publications statistical publications etc Example Suppose a problem is ldquoWhy are sales downrdquo This can quickly be analyzed with the help of published data which should indicate ldquowhether the problem is an ldquoindustry problemrdquo or a ldquofirm problemrdquo Three possibilities exist to formulate the hypothesis

The companyrsquos market share has declined but industryrsquos figures are normal

The industry is declining and hence the companyrsquos market share is also declining

The industryrsquos share is going up but the companyrsquos share is declining

If we accept the situation that our companyrsquos sales are down despite the market showing an upward trend then we need to analyse the marketing mix variables

Example 1 A TV manufacturing company feels that its market share is declining whereas the overall television industry is doing very well

Example 2 Due to a trade embargo imposed by a country textiles exports are down and hence sales of a company making garment for exports is on the decline

The above information may be used to pinpoint the reason for declining sales

Experience Survey

In experience surveys it is desirable to talk to persons who are well informed in the area being investigated These people may be company executives or persons outside the organisation Here no questionnaire is required The approach adopted in an experience survey should be highly unstructured so that the respondent can give divergent views Since the idea of using experience survey is to undertake problem formulation and not conclusion probability sample need not be used Those who cannot speak freely should be excluded from the sample

Examples

1) A group of housewives may be approached for their choice for a ldquoready to cook productrdquo

2) A publisher might want to find out the reason for poor circulation of newspaper introduced recently He might meet (a) Newspaper sellers (b) Public reading room (c) General public (d) Business community etc

These are experienced persons whose knowledge researcher can use

Focus Group

Another widely used technique in exploratory research is the focus group In a focus group a small number of individuals are brought together to study and talk about some topic of interest The discussion is co-ordinated by a moderator The group usually is of 8-12 persons While selecting these persons care has to be taken to see that they should have a common background and have similar experiences in buying This is required because there should not be a conflict among the group members on the common issues that are being discussed During the discussion future buying attitudes present buying opinion etc are gathered

Most of the companies conducting the focus groups first screen the candidates to determine who will compose the particular group Firms also take care to avoid groups in which some of the participants have their friends and relatives because this leads to a biased discussion Normally a number of such groups are constituted and the final conclusion of various groups are taken for formulating the hypothesis Therefore a key factor in focus group is to have similar groups Normally there are 4-5 groups Some of them may even have 6-8 groups The guiding criteria is to see whether the latter groups are generating additional ideas or repeating the same with respect to the subject under study When this shows a diminishing return from the group the discussions stopped The typical focus group lasts for 1-30 hours to 2 hours The moderator under the focus group has a key role His job is to guide the group to proceed in the right direction

Analysis of selected cases

Analysing a selected case sometimes gives an insight into the problem which is being researched Case histories of companies which have undergone a similar situation may be available These case studies are well suited to carry out exploratory research However the result of investigation of case histories arc always considered suggestive rather than conclusive In case of preference to ldquoready to eat foodrdquo many case histories may be available in the form of previous studies made by competitors We must carefully examine the already published case studies with regard to other variables such as price advertisement changes in the taste etc

II DESCRIPTIVE RESEARCH AND ITrsquoS METHODS

Descriptive research is used to obtain information concerning the current status of the phenomena to describe ldquowhat existsrdquo with respect to variables or conditions in a situation The methods involved range from the survey which describes the status quo the correlation study which investigates the relationship between variables to developmental studies which seek to determine changes over time

Descriptive Research Methods

1 Case Studies

Detailed analysis of a single (or limited number) of people or events Case studies are usually interesting because of the unusualness of the case The major problem with case studies is the problem of objectivity The person who is presenting the case usually has some theoretical orientation It is acceptable for a theoretical orientation to affect onersquos interpretation of events In a case study the theoretical orientation can also lead to the selection of the facts to include in the case It is not surprising that case studies often seem to provide very compelling evidence for a theory Case studies can therefore assist psychology by illustrating how a theory could be applied to a person or events and by assisting with the development of hypotheses for more systematic testing

2 Observational Research

Accounts of the natural behavior of individuals or groups in some setting Unless the observation is unobtrusive there may be some subject reactivity to being observed This often decreases with time a process called habituation Observers cannot usually observe all behaviors all of the time They may use a behavioral checklist and may also use time sampling or event sampling procedures It is important to assess observer bias by the use of interobserver reliability Observational research may also pose ethical problems These can arise when the behaviors being observed are not public behaviors and when the observer joins a group in order to observe the membersrsquo behavior ndash participant observation

3 Survey Research

Structured questions to assess peoples beliefs attitudes and self-reports of behavior If the researcher wishes to generalize the responses to a population it is important to have a representative sample Surveys that rely on self-selection (respond if you are interested) produce non-generalizable results Surveys also provide information for co relational research One can correlate responses to some questions (often demographic questions) with responses to other questions (often attitudes or reports of behavior) Survey question must be clear and unambiguous Even if the questions are unambiguous and non-leading people may display a social desirability bias and give positive or socially acceptable and desirable answers Survey methods include (1) the interview or face-to-face method which is generally viewed as the best method for obtaining a high rate of responses but is also very costly (2) phone surveys which are less expensive but have a higher non-response rate (which has probably increased with caller ID) and (3) written or mail surveys which are least expensive but have a very high non-response rate Follow-up messages can help increase the response rate

4 Archival Research

Analysis of pre-existing data or records Archival research often involves content analysis a qualitative analysis of material For example one would use content analysis to determine whether there had been an increase in the frequency with which women and minorities were mentioned in US history books between 1920 and 2000 Some archival research is quasi-experimental

III EXPERIMENTAL RESEARCH AND ITrsquoS STAGES

Science revolves around experiments and learning the best way of conducting an experiment is crucial to obtaining useful and valid results When scientists speak of experiments in the strictest sense of the word they mean a true experiment where the scientist controls all of the factors and conditions Real world observations and case studies should be referred to as observational research rather than experiments For example observing animals in the wild is not a true experiment because it does not isolate and manipulate an independent variable

THE BASIS OF CONDUCTING AN EXPERIMENT

With an experiment the researcher is trying to learn something new about the world an explanation of lsquowhyrsquo something happens The experiment must maintain internal and external validity or the results will be useless When designing an experiment a researcher must follow all of the steps of the scientific method from making sure that the hypothesis is valid and testable to using controls and statistical tests

Whilst all scientists use reasoning operationalization and the steps of the scientific process it is not always a conscious process Experience and practice mean that many scientists follow an instinctive process of conducting an experiment the lsquostreamlinedrsquo scientific process Following the basic steps will usually generate valid results but where experiments are complex and expensive it is always advisable to follow the rigorous scientific protocols

Conducting a experiment has a number of stages where the parameters and structure of the experiment are made clear Whilst it is rarely practical to follow each step strictly any aberrations must be justified whether they arise because of budget impracticality or ethics

STAGE ONE

After deciding upon a hypothesis and making predictions the first stage of conducting an experiment is to specify the sample groups These should be large enough to give a statistically viable study but small enough to be practical Ideally groups should be selected at random from a wide selection of the sample population This allows results to be generalized to the population as a whole In the physical sciences this is fairly easy but the biological and behavioral sciences are often limited by other factors

For example medical trials often cannot find random groups Such research often relies upon volunteers so it is difficult to apply any realistic randomization This is not a problem as long as the process is justified and the results are not applied to the population as a whole If a psychological researcher used volunteers who were male students aged between 18 and 24 the findings can only be generalized to that specific demographic group within society

STAGE TWO

The sample groups should be divided into a control group and a test group to reduce the possibility of confounding variables This again should be random and the assigning of subjects to groups should be blind or double blind This will reduce the chances of experimental error or bias when conducting an experiment

Ethics are often a barrier to this process because deliberately withholding treatment is not permitted Again any deviations from this process must be explained in the conclusion There is nothing wrong with compromising upon randomness where necessary as long as other scientists are aware of how and why the researcher selected groups on that basis

STAGE THREE

This stage of conducting an experiment involves determining the time scale and frequency of sampling to fit the type of experiment For example researchers studying the effectiveness of a cure for colds would take frequent samples over a period of days Researchers testing a cure for Parkinsonrsquos disease would use less frequent tests over a period of months or years

STAGE FOUR

The penultimate stage of the experiment involves performing the experiment according to the methods stipulated during the design phase The independent variable is manipulated generating a usable data set for the dependent variable

STAGE FIVE

The raw data from the results should be gathered and analyzed by statistical means This allows the researcher to establish if there is any relationship between the variables and accept or reject the null hypothesis

These steps are essential to providing excellent results Whilst many researchers do not want to become involved in the exact processes of inductive reasoning deductive reasoning and operationalization they all follow the basic steps of conducting an experiment This ensures that their results are valid

Exploratory research methods

The quickest and the cheapest way to formulate a hypothesis in exploratory research is by using any of the four methods

Literature search

Experience survey

Focus group

Analysis of selected cases

Literature Search

This refers to ldquoreferring to a literature to develop a new hypothesisrdquo The literature referred are ndash trade journals professional journals market research finding publications statistical publications etc Example Suppose a problem is ldquoWhy are sales downrdquo This can quickly be analyzed with the help of published data which should indicate ldquowhether the problem is an ldquoindustry problemrdquo or a ldquofirm problemrdquo Three possibilities exist to formulate the hypothesis

The companyrsquos market share has declined but industryrsquos figures are normal

The industry is declining and hence the companyrsquos market share is also declining

The industryrsquos share is going up but the companyrsquos share is declining

If we accept the situation that our companyrsquos sales are down despite the market showing an upward trend then we need to analyse the marketing mix variables

Example 1 A TV manufacturing company feels that its market share is declining whereas the overall television industry is doing very well

Example 2 Due to a trade embargo imposed by a country textiles exports are down and hence sales of a company making garment for exports is on the decline

The above information may be used to pinpoint the reason for declining sales

Experience Survey

In experience surveys it is desirable to talk to persons who are well informed in the area being investigated These people may be company executives or persons outside the organisation Here no questionnaire is required The approach adopted in an experience survey should be highly unstructured so that the respondent can give divergent views Since the idea of using experience survey is to undertake problem formulation and not conclusion probability sample need not be used Those who cannot speak freely should be excluded from the sample

Examples

1) A group of housewives may be approached for their choice for a ldquoready to cook productrdquo

2) A publisher might want to find out the reason for poor circulation of newspaper introduced recently He might meet (a) Newspaper sellers (b) Public reading room (c) General public (d) Business community etc

These are experienced persons whose knowledge researcher can use

Focus Group

Another widely used technique in exploratory research is the focus group In a focus group a small number of individuals are brought together to study and talk about some topic of interest The discussion is co-ordinated by a moderator The group usually is of 8-12 persons While selecting these persons care has to be taken to see that they should have a common background and have similar experiences in buying This is required because there should not be a conflict among the group members on the common issues that are being discussed During the discussion future buying attitudes present buying opinion etc are gathered

Most of the companies conducting the focus groups first screen the candidates to determine who will compose the particular group Firms also take care to avoid groups in which some of the participants have their friends and relatives because this leads to a biased discussion Normally a number of such groups are constituted and the final conclusion of various groups are taken for formulating the hypothesis Therefore a key factor in focus group is to have similar groups Normally there are 4-5 groups Some of them may even have 6-8 groups The guiding criteria is to see whether the latter groups are generating additional ideas or repeating the same with respect to the subject under study When this shows a diminishing return from the group the discussions stopped The typical focus group lasts for 1-30 hours to 2 hours The moderator under the focus group has a key role His job is to guide the group to proceed in the right direction

Analysis of selected cases

Analysing a selected case sometimes gives an insight into the problem which is being researched Case histories of companies which have undergone a similar situation may be available These case studies are well suited to carry out exploratory research However the result of investigation of case histories arc always considered suggestive rather than conclusive In case of preference to ldquoready to eat foodrdquo many case histories may be available in the form of previous studies made by competitors We must carefully examine the already published case studies with regard to other variables such as price advertisement changes in the taste etc

II DESCRIPTIVE RESEARCH AND ITrsquoS METHODS

Descriptive research is used to obtain information concerning the current status of the phenomena to describe ldquowhat existsrdquo with respect to variables or conditions in a situation The methods involved range from the survey which describes the status quo the correlation study which investigates the relationship between variables to developmental studies which seek to determine changes over time

Descriptive Research Methods

1 Case Studies

Detailed analysis of a single (or limited number) of people or events Case studies are usually interesting because of the unusualness of the case The major problem with case studies is the problem of objectivity The person who is presenting the case usually has some theoretical orientation It is acceptable for a theoretical orientation to affect onersquos interpretation of events In a case study the theoretical orientation can also lead to the selection of the facts to include in the case It is not surprising that case studies often seem to provide very compelling evidence for a theory Case studies can therefore assist psychology by illustrating how a theory could be applied to a person or events and by assisting with the development of hypotheses for more systematic testing

2 Observational Research

Accounts of the natural behavior of individuals or groups in some setting Unless the observation is unobtrusive there may be some subject reactivity to being observed This often decreases with time a process called habituation Observers cannot usually observe all behaviors all of the time They may use a behavioral checklist and may also use time sampling or event sampling procedures It is important to assess observer bias by the use of interobserver reliability Observational research may also pose ethical problems These can arise when the behaviors being observed are not public behaviors and when the observer joins a group in order to observe the membersrsquo behavior ndash participant observation

3 Survey Research

Structured questions to assess peoples beliefs attitudes and self-reports of behavior If the researcher wishes to generalize the responses to a population it is important to have a representative sample Surveys that rely on self-selection (respond if you are interested) produce non-generalizable results Surveys also provide information for co relational research One can correlate responses to some questions (often demographic questions) with responses to other questions (often attitudes or reports of behavior) Survey question must be clear and unambiguous Even if the questions are unambiguous and non-leading people may display a social desirability bias and give positive or socially acceptable and desirable answers Survey methods include (1) the interview or face-to-face method which is generally viewed as the best method for obtaining a high rate of responses but is also very costly (2) phone surveys which are less expensive but have a higher non-response rate (which has probably increased with caller ID) and (3) written or mail surveys which are least expensive but have a very high non-response rate Follow-up messages can help increase the response rate

4 Archival Research

Analysis of pre-existing data or records Archival research often involves content analysis a qualitative analysis of material For example one would use content analysis to determine whether there had been an increase in the frequency with which women and minorities were mentioned in US history books between 1920 and 2000 Some archival research is quasi-experimental

III EXPERIMENTAL RESEARCH AND ITrsquoS STAGES

Science revolves around experiments and learning the best way of conducting an experiment is crucial to obtaining useful and valid results When scientists speak of experiments in the strictest sense of the word they mean a true experiment where the scientist controls all of the factors and conditions Real world observations and case studies should be referred to as observational research rather than experiments For example observing animals in the wild is not a true experiment because it does not isolate and manipulate an independent variable

THE BASIS OF CONDUCTING AN EXPERIMENT

With an experiment the researcher is trying to learn something new about the world an explanation of lsquowhyrsquo something happens The experiment must maintain internal and external validity or the results will be useless When designing an experiment a researcher must follow all of the steps of the scientific method from making sure that the hypothesis is valid and testable to using controls and statistical tests

Whilst all scientists use reasoning operationalization and the steps of the scientific process it is not always a conscious process Experience and practice mean that many scientists follow an instinctive process of conducting an experiment the lsquostreamlinedrsquo scientific process Following the basic steps will usually generate valid results but where experiments are complex and expensive it is always advisable to follow the rigorous scientific protocols

Conducting a experiment has a number of stages where the parameters and structure of the experiment are made clear Whilst it is rarely practical to follow each step strictly any aberrations must be justified whether they arise because of budget impracticality or ethics

STAGE ONE

After deciding upon a hypothesis and making predictions the first stage of conducting an experiment is to specify the sample groups These should be large enough to give a statistically viable study but small enough to be practical Ideally groups should be selected at random from a wide selection of the sample population This allows results to be generalized to the population as a whole In the physical sciences this is fairly easy but the biological and behavioral sciences are often limited by other factors

For example medical trials often cannot find random groups Such research often relies upon volunteers so it is difficult to apply any realistic randomization This is not a problem as long as the process is justified and the results are not applied to the population as a whole If a psychological researcher used volunteers who were male students aged between 18 and 24 the findings can only be generalized to that specific demographic group within society

STAGE TWO

The sample groups should be divided into a control group and a test group to reduce the possibility of confounding variables This again should be random and the assigning of subjects to groups should be blind or double blind This will reduce the chances of experimental error or bias when conducting an experiment

Ethics are often a barrier to this process because deliberately withholding treatment is not permitted Again any deviations from this process must be explained in the conclusion There is nothing wrong with compromising upon randomness where necessary as long as other scientists are aware of how and why the researcher selected groups on that basis

STAGE THREE

This stage of conducting an experiment involves determining the time scale and frequency of sampling to fit the type of experiment For example researchers studying the effectiveness of a cure for colds would take frequent samples over a period of days Researchers testing a cure for Parkinsonrsquos disease would use less frequent tests over a period of months or years

STAGE FOUR

The penultimate stage of the experiment involves performing the experiment according to the methods stipulated during the design phase The independent variable is manipulated generating a usable data set for the dependent variable

STAGE FIVE

The raw data from the results should be gathered and analyzed by statistical means This allows the researcher to establish if there is any relationship between the variables and accept or reject the null hypothesis

These steps are essential to providing excellent results Whilst many researchers do not want to become involved in the exact processes of inductive reasoning deductive reasoning and operationalization they all follow the basic steps of conducting an experiment This ensures that their results are valid

2) A publisher might want to find out the reason for poor circulation of newspaper introduced recently He might meet (a) Newspaper sellers (b) Public reading room (c) General public (d) Business community etc

These are experienced persons whose knowledge researcher can use

Focus Group

Another widely used technique in exploratory research is the focus group In a focus group a small number of individuals are brought together to study and talk about some topic of interest The discussion is co-ordinated by a moderator The group usually is of 8-12 persons While selecting these persons care has to be taken to see that they should have a common background and have similar experiences in buying This is required because there should not be a conflict among the group members on the common issues that are being discussed During the discussion future buying attitudes present buying opinion etc are gathered

Most of the companies conducting the focus groups first screen the candidates to determine who will compose the particular group Firms also take care to avoid groups in which some of the participants have their friends and relatives because this leads to a biased discussion Normally a number of such groups are constituted and the final conclusion of various groups are taken for formulating the hypothesis Therefore a key factor in focus group is to have similar groups Normally there are 4-5 groups Some of them may even have 6-8 groups The guiding criteria is to see whether the latter groups are generating additional ideas or repeating the same with respect to the subject under study When this shows a diminishing return from the group the discussions stopped The typical focus group lasts for 1-30 hours to 2 hours The moderator under the focus group has a key role His job is to guide the group to proceed in the right direction

Analysis of selected cases

Analysing a selected case sometimes gives an insight into the problem which is being researched Case histories of companies which have undergone a similar situation may be available These case studies are well suited to carry out exploratory research However the result of investigation of case histories arc always considered suggestive rather than conclusive In case of preference to ldquoready to eat foodrdquo many case histories may be available in the form of previous studies made by competitors We must carefully examine the already published case studies with regard to other variables such as price advertisement changes in the taste etc

II DESCRIPTIVE RESEARCH AND ITrsquoS METHODS

Descriptive research is used to obtain information concerning the current status of the phenomena to describe ldquowhat existsrdquo with respect to variables or conditions in a situation The methods involved range from the survey which describes the status quo the correlation study which investigates the relationship between variables to developmental studies which seek to determine changes over time

Descriptive Research Methods

1 Case Studies

Detailed analysis of a single (or limited number) of people or events Case studies are usually interesting because of the unusualness of the case The major problem with case studies is the problem of objectivity The person who is presenting the case usually has some theoretical orientation It is acceptable for a theoretical orientation to affect onersquos interpretation of events In a case study the theoretical orientation can also lead to the selection of the facts to include in the case It is not surprising that case studies often seem to provide very compelling evidence for a theory Case studies can therefore assist psychology by illustrating how a theory could be applied to a person or events and by assisting with the development of hypotheses for more systematic testing

2 Observational Research

Accounts of the natural behavior of individuals or groups in some setting Unless the observation is unobtrusive there may be some subject reactivity to being observed This often decreases with time a process called habituation Observers cannot usually observe all behaviors all of the time They may use a behavioral checklist and may also use time sampling or event sampling procedures It is important to assess observer bias by the use of interobserver reliability Observational research may also pose ethical problems These can arise when the behaviors being observed are not public behaviors and when the observer joins a group in order to observe the membersrsquo behavior ndash participant observation

3 Survey Research

Structured questions to assess peoples beliefs attitudes and self-reports of behavior If the researcher wishes to generalize the responses to a population it is important to have a representative sample Surveys that rely on self-selection (respond if you are interested) produce non-generalizable results Surveys also provide information for co relational research One can correlate responses to some questions (often demographic questions) with responses to other questions (often attitudes or reports of behavior) Survey question must be clear and unambiguous Even if the questions are unambiguous and non-leading people may display a social desirability bias and give positive or socially acceptable and desirable answers Survey methods include (1) the interview or face-to-face method which is generally viewed as the best method for obtaining a high rate of responses but is also very costly (2) phone surveys which are less expensive but have a higher non-response rate (which has probably increased with caller ID) and (3) written or mail surveys which are least expensive but have a very high non-response rate Follow-up messages can help increase the response rate

4 Archival Research

Analysis of pre-existing data or records Archival research often involves content analysis a qualitative analysis of material For example one would use content analysis to determine whether there had been an increase in the frequency with which women and minorities were mentioned in US history books between 1920 and 2000 Some archival research is quasi-experimental

III EXPERIMENTAL RESEARCH AND ITrsquoS STAGES

Science revolves around experiments and learning the best way of conducting an experiment is crucial to obtaining useful and valid results When scientists speak of experiments in the strictest sense of the word they mean a true experiment where the scientist controls all of the factors and conditions Real world observations and case studies should be referred to as observational research rather than experiments For example observing animals in the wild is not a true experiment because it does not isolate and manipulate an independent variable

THE BASIS OF CONDUCTING AN EXPERIMENT

With an experiment the researcher is trying to learn something new about the world an explanation of lsquowhyrsquo something happens The experiment must maintain internal and external validity or the results will be useless When designing an experiment a researcher must follow all of the steps of the scientific method from making sure that the hypothesis is valid and testable to using controls and statistical tests

Whilst all scientists use reasoning operationalization and the steps of the scientific process it is not always a conscious process Experience and practice mean that many scientists follow an instinctive process of conducting an experiment the lsquostreamlinedrsquo scientific process Following the basic steps will usually generate valid results but where experiments are complex and expensive it is always advisable to follow the rigorous scientific protocols

Conducting a experiment has a number of stages where the parameters and structure of the experiment are made clear Whilst it is rarely practical to follow each step strictly any aberrations must be justified whether they arise because of budget impracticality or ethics

STAGE ONE

After deciding upon a hypothesis and making predictions the first stage of conducting an experiment is to specify the sample groups These should be large enough to give a statistically viable study but small enough to be practical Ideally groups should be selected at random from a wide selection of the sample population This allows results to be generalized to the population as a whole In the physical sciences this is fairly easy but the biological and behavioral sciences are often limited by other factors

For example medical trials often cannot find random groups Such research often relies upon volunteers so it is difficult to apply any realistic randomization This is not a problem as long as the process is justified and the results are not applied to the population as a whole If a psychological researcher used volunteers who were male students aged between 18 and 24 the findings can only be generalized to that specific demographic group within society

STAGE TWO

The sample groups should be divided into a control group and a test group to reduce the possibility of confounding variables This again should be random and the assigning of subjects to groups should be blind or double blind This will reduce the chances of experimental error or bias when conducting an experiment

Ethics are often a barrier to this process because deliberately withholding treatment is not permitted Again any deviations from this process must be explained in the conclusion There is nothing wrong with compromising upon randomness where necessary as long as other scientists are aware of how and why the researcher selected groups on that basis

STAGE THREE

This stage of conducting an experiment involves determining the time scale and frequency of sampling to fit the type of experiment For example researchers studying the effectiveness of a cure for colds would take frequent samples over a period of days Researchers testing a cure for Parkinsonrsquos disease would use less frequent tests over a period of months or years

STAGE FOUR

The penultimate stage of the experiment involves performing the experiment according to the methods stipulated during the design phase The independent variable is manipulated generating a usable data set for the dependent variable

STAGE FIVE

The raw data from the results should be gathered and analyzed by statistical means This allows the researcher to establish if there is any relationship between the variables and accept or reject the null hypothesis

These steps are essential to providing excellent results Whilst many researchers do not want to become involved in the exact processes of inductive reasoning deductive reasoning and operationalization they all follow the basic steps of conducting an experiment This ensures that their results are valid

Descriptive Research Methods

1 Case Studies

Detailed analysis of a single (or limited number) of people or events Case studies are usually interesting because of the unusualness of the case The major problem with case studies is the problem of objectivity The person who is presenting the case usually has some theoretical orientation It is acceptable for a theoretical orientation to affect onersquos interpretation of events In a case study the theoretical orientation can also lead to the selection of the facts to include in the case It is not surprising that case studies often seem to provide very compelling evidence for a theory Case studies can therefore assist psychology by illustrating how a theory could be applied to a person or events and by assisting with the development of hypotheses for more systematic testing

2 Observational Research

Accounts of the natural behavior of individuals or groups in some setting Unless the observation is unobtrusive there may be some subject reactivity to being observed This often decreases with time a process called habituation Observers cannot usually observe all behaviors all of the time They may use a behavioral checklist and may also use time sampling or event sampling procedures It is important to assess observer bias by the use of interobserver reliability Observational research may also pose ethical problems These can arise when the behaviors being observed are not public behaviors and when the observer joins a group in order to observe the membersrsquo behavior ndash participant observation

3 Survey Research

Structured questions to assess peoples beliefs attitudes and self-reports of behavior If the researcher wishes to generalize the responses to a population it is important to have a representative sample Surveys that rely on self-selection (respond if you are interested) produce non-generalizable results Surveys also provide information for co relational research One can correlate responses to some questions (often demographic questions) with responses to other questions (often attitudes or reports of behavior) Survey question must be clear and unambiguous Even if the questions are unambiguous and non-leading people may display a social desirability bias and give positive or socially acceptable and desirable answers Survey methods include (1) the interview or face-to-face method which is generally viewed as the best method for obtaining a high rate of responses but is also very costly (2) phone surveys which are less expensive but have a higher non-response rate (which has probably increased with caller ID) and (3) written or mail surveys which are least expensive but have a very high non-response rate Follow-up messages can help increase the response rate

4 Archival Research

Analysis of pre-existing data or records Archival research often involves content analysis a qualitative analysis of material For example one would use content analysis to determine whether there had been an increase in the frequency with which women and minorities were mentioned in US history books between 1920 and 2000 Some archival research is quasi-experimental

III EXPERIMENTAL RESEARCH AND ITrsquoS STAGES

Science revolves around experiments and learning the best way of conducting an experiment is crucial to obtaining useful and valid results When scientists speak of experiments in the strictest sense of the word they mean a true experiment where the scientist controls all of the factors and conditions Real world observations and case studies should be referred to as observational research rather than experiments For example observing animals in the wild is not a true experiment because it does not isolate and manipulate an independent variable

THE BASIS OF CONDUCTING AN EXPERIMENT

With an experiment the researcher is trying to learn something new about the world an explanation of lsquowhyrsquo something happens The experiment must maintain internal and external validity or the results will be useless When designing an experiment a researcher must follow all of the steps of the scientific method from making sure that the hypothesis is valid and testable to using controls and statistical tests

Whilst all scientists use reasoning operationalization and the steps of the scientific process it is not always a conscious process Experience and practice mean that many scientists follow an instinctive process of conducting an experiment the lsquostreamlinedrsquo scientific process Following the basic steps will usually generate valid results but where experiments are complex and expensive it is always advisable to follow the rigorous scientific protocols

Conducting a experiment has a number of stages where the parameters and structure of the experiment are made clear Whilst it is rarely practical to follow each step strictly any aberrations must be justified whether they arise because of budget impracticality or ethics

STAGE ONE

After deciding upon a hypothesis and making predictions the first stage of conducting an experiment is to specify the sample groups These should be large enough to give a statistically viable study but small enough to be practical Ideally groups should be selected at random from a wide selection of the sample population This allows results to be generalized to the population as a whole In the physical sciences this is fairly easy but the biological and behavioral sciences are often limited by other factors

For example medical trials often cannot find random groups Such research often relies upon volunteers so it is difficult to apply any realistic randomization This is not a problem as long as the process is justified and the results are not applied to the population as a whole If a psychological researcher used volunteers who were male students aged between 18 and 24 the findings can only be generalized to that specific demographic group within society

STAGE TWO

The sample groups should be divided into a control group and a test group to reduce the possibility of confounding variables This again should be random and the assigning of subjects to groups should be blind or double blind This will reduce the chances of experimental error or bias when conducting an experiment

Ethics are often a barrier to this process because deliberately withholding treatment is not permitted Again any deviations from this process must be explained in the conclusion There is nothing wrong with compromising upon randomness where necessary as long as other scientists are aware of how and why the researcher selected groups on that basis

STAGE THREE

This stage of conducting an experiment involves determining the time scale and frequency of sampling to fit the type of experiment For example researchers studying the effectiveness of a cure for colds would take frequent samples over a period of days Researchers testing a cure for Parkinsonrsquos disease would use less frequent tests over a period of months or years

STAGE FOUR

The penultimate stage of the experiment involves performing the experiment according to the methods stipulated during the design phase The independent variable is manipulated generating a usable data set for the dependent variable

STAGE FIVE

The raw data from the results should be gathered and analyzed by statistical means This allows the researcher to establish if there is any relationship between the variables and accept or reject the null hypothesis

These steps are essential to providing excellent results Whilst many researchers do not want to become involved in the exact processes of inductive reasoning deductive reasoning and operationalization they all follow the basic steps of conducting an experiment This ensures that their results are valid

III EXPERIMENTAL RESEARCH AND ITrsquoS STAGES

Science revolves around experiments and learning the best way of conducting an experiment is crucial to obtaining useful and valid results When scientists speak of experiments in the strictest sense of the word they mean a true experiment where the scientist controls all of the factors and conditions Real world observations and case studies should be referred to as observational research rather than experiments For example observing animals in the wild is not a true experiment because it does not isolate and manipulate an independent variable

THE BASIS OF CONDUCTING AN EXPERIMENT

With an experiment the researcher is trying to learn something new about the world an explanation of lsquowhyrsquo something happens The experiment must maintain internal and external validity or the results will be useless When designing an experiment a researcher must follow all of the steps of the scientific method from making sure that the hypothesis is valid and testable to using controls and statistical tests

Whilst all scientists use reasoning operationalization and the steps of the scientific process it is not always a conscious process Experience and practice mean that many scientists follow an instinctive process of conducting an experiment the lsquostreamlinedrsquo scientific process Following the basic steps will usually generate valid results but where experiments are complex and expensive it is always advisable to follow the rigorous scientific protocols

Conducting a experiment has a number of stages where the parameters and structure of the experiment are made clear Whilst it is rarely practical to follow each step strictly any aberrations must be justified whether they arise because of budget impracticality or ethics

STAGE ONE

After deciding upon a hypothesis and making predictions the first stage of conducting an experiment is to specify the sample groups These should be large enough to give a statistically viable study but small enough to be practical Ideally groups should be selected at random from a wide selection of the sample population This allows results to be generalized to the population as a whole In the physical sciences this is fairly easy but the biological and behavioral sciences are often limited by other factors

For example medical trials often cannot find random groups Such research often relies upon volunteers so it is difficult to apply any realistic randomization This is not a problem as long as the process is justified and the results are not applied to the population as a whole If a psychological researcher used volunteers who were male students aged between 18 and 24 the findings can only be generalized to that specific demographic group within society

STAGE TWO

The sample groups should be divided into a control group and a test group to reduce the possibility of confounding variables This again should be random and the assigning of subjects to groups should be blind or double blind This will reduce the chances of experimental error or bias when conducting an experiment

Ethics are often a barrier to this process because deliberately withholding treatment is not permitted Again any deviations from this process must be explained in the conclusion There is nothing wrong with compromising upon randomness where necessary as long as other scientists are aware of how and why the researcher selected groups on that basis

STAGE THREE

This stage of conducting an experiment involves determining the time scale and frequency of sampling to fit the type of experiment For example researchers studying the effectiveness of a cure for colds would take frequent samples over a period of days Researchers testing a cure for Parkinsonrsquos disease would use less frequent tests over a period of months or years

STAGE FOUR

The penultimate stage of the experiment involves performing the experiment according to the methods stipulated during the design phase The independent variable is manipulated generating a usable data set for the dependent variable

STAGE FIVE

The raw data from the results should be gathered and analyzed by statistical means This allows the researcher to establish if there is any relationship between the variables and accept or reject the null hypothesis

These steps are essential to providing excellent results Whilst many researchers do not want to become involved in the exact processes of inductive reasoning deductive reasoning and operationalization they all follow the basic steps of conducting an experiment This ensures that their results are valid

Ethics are often a barrier to this process because deliberately withholding treatment is not permitted Again any deviations from this process must be explained in the conclusion There is nothing wrong with compromising upon randomness where necessary as long as other scientists are aware of how and why the researcher selected groups on that basis

STAGE THREE

This stage of conducting an experiment involves determining the time scale and frequency of sampling to fit the type of experiment For example researchers studying the effectiveness of a cure for colds would take frequent samples over a period of days Researchers testing a cure for Parkinsonrsquos disease would use less frequent tests over a period of months or years

STAGE FOUR

The penultimate stage of the experiment involves performing the experiment according to the methods stipulated during the design phase The independent variable is manipulated generating a usable data set for the dependent variable

STAGE FIVE

The raw data from the results should be gathered and analyzed by statistical means This allows the researcher to establish if there is any relationship between the variables and accept or reject the null hypothesis

These steps are essential to providing excellent results Whilst many researchers do not want to become involved in the exact processes of inductive reasoning deductive reasoning and operationalization they all follow the basic steps of conducting an experiment This ensures that their results are valid