BUS115 Midterm (Ch. 1-9)

Marketing Mix

Marketing Mix

Product, price, promotion, place (distribution)

Marketing Concept

aim is to be more effective than competitors in creating, delivering, and communicating customer value.

Marketing Research

designing, gathering, analyzing, reporting, and interpreting information that may be used to solve a specific marketing problem. 

Market research

define size, location, makeup of market for product/service

Marketing research links

how the customer is going to be influenced by the marketing channel to make decisions.

Father of Marketing Research

Charles Coolidge Parlin (1930s)

Father of Statistical Sampling

Alfred Politz

Father of Focus Groups

Robert Merton

Client Side Research

market research done internally by company

Supply-side research

companies with lots of capital can go to companies dedicated to marketing.

Full-service supplier firms

do everything from defining problems, research design, collecting/analyzing data, and making the final report.

Limited-service supplier firms

do only one or a few parts of the marketing service

• Ex:

  • Online communities

  • questionnaires

  • data collection

  • data analysis

  • pretesting

  • market demographics (ex: senior citizens).

Packaged services

proprietary process (secret and unique system) used for services like test marketing or measuring customer/employee satisfaction.

Biggest marketing research firm:

Neilson

Worldwide revenue of marketing

$44 billion

3 types of research design

1. Exploratory

2. Descriptive

3. Causal

3 general ways to collect data:

1. Questionnaire- without bias

2. Focus group- focus group guide

3. Observe respondents- observation form

What does it mean to validate data?

select 10% of respondents randomly and check that they indeed took part in the survey.

typical number of research objectives

3-6

Action standard

insight from research that allow manager to make a decision.

“If we research X, what needs to happen for us to use this research to make a decision?”

3 main objectives of research design

1. To gain background info, hypotheses

2. To understand the state of a variable (ex: level of brand loyalty)

3. To learn about the relationships between variables (ex: how level of brand loyalty is affected by advertising)

Exploratory research

Unstructured. broad, trying to feel out the industry. 

4 methods of exploratory research: 

1. Secondary data analysis

2. Experience surveys: Key informant / Lead-user surveys

3. Case analysis

4. Focus groups

key informant (type of experience survey)

consult someone who is very knowledgeable about subject

lead-user (type of experience survey)

consult someone who will be an avid potential customer/user of this product.

descriptive research

Examines characteristics of consumers/markets. Who, what, where, when, how.

2 methods of descriptive research

1. Cross-sectional studies

2. Longitudinal studies

Cross-sectional studies

a snapshot of population through sample surveys

ex: # of people w diabetes who are not obests vs. who are at a certain point in time

Longitudinal studies

repeatedly measure same people over time. “Movies of the population.”

Panels

Respondents who have agreed to answer questions at regular intervals. 

2 types of panels:

1. continuous panels

2. discontinuous/omnibus panels

Continuous panels

same questions each time to measure changes in consumers’ attitudes and behaviors over time. 

• Ex: brand switching, market-tracking

Discontinuous or omnibus panels

Different questions to same people. Helpful to have consumers that can be quickly accessed for different purposes.

Causal research

“If x, then y.” Uses experiment with independent, dependent, and extraneous variables. 

before-after testing

type of survey design where dependent variable is measured before and after independent variable is changed.

pretest

dependent variable measured before independent variable is changed

posttest

dependent variable is measured after independnent variable is changed.

A/B testing

2 alternatives are simultaneosly tested to see which performs better.

internally valid experiment

change is actually due to changing independent variable

externally valid experiement

when relationship between variables can be generalized to the real world.

test marketing

type of field setting where sales potential is tested in natural setting and independent variables of marketing mix are manipulated.

standard test marketing

firm tests product/marketing mix through normal distribution channels.

• Pro: Externally valid.

• Con: competitors are aware of new products. 

Controlled test markets

supply side research with specific distribution methods.

Simulated test markets

data on consumer response to a new product is fed into a model containing certain assumptions regarding planned marketing programs, which generates likely product sales volume. Competition won’t see. Not as externally valid.

big data

Lots of data from multiple sources. We generate 2.5 quintillion bytes of data daily.

primary data

developed by researchers for a specific project.

Secondary data

previously gathered data for another purpose outside of the company that can be applied in current context.

Internal secondary data

data that has been accumulated within the firm in the past and is used in database marketing or new research.

how can internal databases be used?

help direct marketing and strengthen relationships with customers, called CRM. Ex:

• not charging a fee to the biggest customer

• sending birthday invites to customers automatically

Data mining

making sense out of lots of data

micromarketing

creating a different marketing mix strategy for each customer segment.

4 types of external databases (databases supplied by outside firm organizations)

1. Published sources

2. Official statistics

3. Data aggregators

4. Syndicated services data

Published sources (type of external database)

publicly distributed by specialists

• business journals

• magazines

• newspapers

  • academic journals

Official statistics

public, government, international organizations

• WHO

• OECD (Organization for Economic Co-operation and development)

• World Bank

• IMF

Data aggregators

vendors package information on focused topics

• IBISWorld

• Statista

• ProQuest

Syndicated services data

firms collect highly specialized data and share them with subscribing firms (for a fee)

Pros of Secondary Data

• quick

• inexpensive (compared to making your own)

• readily available

• can be used to enhance primary data by providing a benchmark and context

• helps research objective

Cons of secondary data

• reporting units don’t match (ex: not same location)

• measurement units don’t match (ex: currency doesn’t match)

• definitions of characteristics can vary slightly

• outdated info or not credible

2 types of packaged information

• syndicated

• packaged services

pros of syndicated data

• shared costs

• faster

• high quality data

cons of syndicated data

• buyers don’t have much control over the data that’s collected.

• buyers must commit to long-term contracts

• competitors have access to the same info

packaged services

premade marketing research but from different data sources and is tailored for each client.

• can be used for measuring customer attitudes

• identifying segments and geodemographics

• monitoring promotion effectiveness

• tracking sales

point of sale (pos)

data automatically collected when consumers buy products

cookie

piece of data sent to computer that stores users browsing data

device ID

unique identifier for a mobile device

geolocation data

identifies the physical location of a device

social media data or user generated content (UGC)

info created by users of online systems and shared with others

sentiment

ratio of positive to negative comments posted about products and brands on web.

quantitative research

• structured questions and predetermined response options with a large population of respondents.

• specific purpose and clear, well defined numerical data format/sources.

• the “what” of the research

qualitative research

• collecting, analyzing, interpreting data by observing what people do and say.

• not standardized, open ended

• studying consumer behavior

• the “why” of the research

• creates “thick” data since its super important when tied with big data.

3 types of Mixed method research

1. Qualitative before quantitative

2. quantitative before qualitiative

3. qualitative and quantitative concurrently

4 types of observation methods

1. direct vs. indirect

2. overt vs. covert

3. structured vs. unstructured

4. in situ vs. invented

direct vs indirect observation methods

• Direct- observe behavior as it happens

• Indirect- observe effects of behavior from archives of secondary sources like historical records or from physical traces like tangible evidence of past events.

Overt vs. Covert observation methods

• Overt- respondent knows.

• Covert- subject doesn’t know they are being observed. (Mystery shopper)

Structured vs. Unstructured observation methods

• Structured- researcher identifies beforehand which behaviors are to be observed/recorded with a checklist and all other behaviors are ignored.

• Unstructured- all behavior is observed and observer determines what should be recorded based on what’s relevant. 

In situ vs. Invented observation methods

• In situ- Researcher observes behavior exactly as it happens

• Invented- Researcher creates simulated situations and watches what happens.

3 characteristics observation methods must have

1. short time intervals

2. public behavior

3. faulty recall conditions - automatic behaviors that person can’t even realize they are doing them.

focus groups

small groups brought together and guided by moderator in unstructured spontaneous discussion to gain relevant info for research problem.

• Typically 6-12 people meet in a room with a 1-way mirror for client viewing.

• Should be used when the objective is to describe rather than predict. 

• Should not be used when research question requires prediction or major decision.

objectives of focus group

• generate Ideas

• understand consumer vocab

• reveal consumer perceptions/motives

• understand correlation to quantitative findings.

pros and cons of focus groups

• Pros:

  • New ideas, client can observe, understand lots of issue, easy to access.

• Cons: 

  • Not representative, dependent on moderator, difficult to interpret.

8 things to consider when designing a focus group

1. # of people

2. Who is in group

3. How many

4. How recruited

5. Where to meet

6. When should moderator get involved

7. How reported

8. Benefits of focus group

2 sections a focus group report must cover:

1. Categories of statements and the apparent consensus in the group. 

2. Demographic/buyer behavior characteristics compared to target market profile to understand how much the group represents the target market.

Ethnographic research

• detailed, comprehensive descriptive study of a group/consumers and their behavior, characteristics, culture, etc., over prolonged periods.

  • Effective for studying trends, habits, lifestyle, social/cultural context on consumption.

  • Close attention to words, metaphors, symbols, stories people use to explain lives and communicate.

3 types of ethnographic research

1. Shopalongs- researcher accompanies a shopper with permission to observe and record shoper’s activities.

2. Mobile ethnography- respondents document their experiences through mobile phones.

3. Netnography- online interactions of individuals/communities on Internet and relationship people have with their electronics.

In-Depth Interviews (IDI)

• probing questions, 1:1

• What the subject thinks about something, why they behave certain way.

laddering

how attributes are associated with consumer values. 

Protocol analysis

placing person in decision-making situation and asking them to verbalize everything they consider when making a decision.

• what protocol does the user take when making a decision?

Projective techniques

participant projected into simulated activities in hopes they will divulge personal information that they wouldn’t normally say when directly questioned.

5 types of projective techniques:

1. Word-association test

2. Sentence completion test

3. Picture test

4. Cartoon/Balloon test

5. Role-playing

Word-association test

- first word that comes to mind.

Sentence completion test-

finish the sentence.

Picture test-

write a short story about picture to describe reactions

Cartoon/balloon test-

given a cartoon strip with characters and an empty speech/thought bubble and respondents fill it in.

Role-playing-

how would they react as a 3rd person to a certain situation or specific statement.

Neuromarketing

understanding people’s involuntary responses to marketing stimuli such as eye movement, heart rate, skin conductance, breathing, brain activity.

3 types of neuromarketing:

1. Neuroimaging- viewing brain activity- unconscious emotions.

2. Eye tracking- measuring eye positions and movement.

3. Facial coding- measure universal expressions of emotions by appearance on faces.

Thematic analysis

examining qualitative data to find themes/patterns related to research objectives.

3 items you need for effective thematic analysis

1. Theme- pattern found across data that relates to objective

2. Substantiating example- example that provides evidence for the theme.

3. Verbatim- quote from participant used as substantiating example.

6 advantages of surveys

1. Standardization

2. Lots of info quickly

3. Easy to do

4. Gets “beneath the surface”

5. Easy to analyze

6. Shows differences in subgroups

3 things to consider when picking a survey method:

1. speed

2. cost

3. quality