Chapter 1; Marketing Research for Managerial Decision Making

Marketing Research

Links an organization to its market through the gathering of information.

• Facilitates identification of market opportunities/threats and corresponding actions.

• Enables performance monitoring and understanding.

  • More information = better decision-making

The Process of Marketing Research

A systematic process. DMAC

• Designing methods for collecting information

• Managing the information collection process

• Analyzing and interpreting results

• Communicating findings to decision makers

  • Poorly executed research results are not useful for decision making (GIGO)

  • Even the best research has strengths and weaknesses

Marketing Research Methods

• A variety of qualitative and quantitative techniques.

• Draw heavily on the social sciences both for methods and theory.

  • Ex: Psychology, Sociology, Anthropology

• Can be applied to a wide variety of problems involving the marketing mix

Product within MR

Development/intro, branding, and positioning products.

• Perceptual mapping

Place within MR

Choosing and evaluating:

• Locations, channels, and distribution partners.

  • Retailing research:

    • Focus on trade area analysis, store image/perception, in-store traffic patterns, and location analysis.

Promotion within MR

Essential that companies know how to obtain good returns from their promotional budgets.

• Most common research tasks in integrated marketing communications:

  • Advertising effectiveness studies

  • Promotion mix decisions

Price within MR

Establishing and/or modifying:

• How large is the demand potential within the target market at various price levels?

  • Helps to forecast sales

• How sensitive is demand to changes in price?

• Are there identifiable segments that have different price sensitivities?

  • Opportunities to target additional markets.

Perceptual Mapping

• Used to picture the relative position of products on two or more product dimensions.

• Important to consumer purchase decisions (also performance/importance matrices).

Segmentation Studies (STP)

Creating customer profiles (demographics, psychographics, usage rates/motivations).

Ethnographic research

To study consumer behavior as activities embedded in a cultural context and laden with identity.

• Extended observation of consumers in context

• True immersion (time consuming/expensive)

  • Ex: Joining he’lls angels to write a study about them.

Types of Marketing Research Firms

1. Internal

2. External

Internal Research Firms

Organizational units that reside within a company.

• Benefits:

  • Research method consistency

  • Shared, private information across the company

  • Lower research costs (per study)

  • Generalist

External Research Firms

Perform all aspects of the research

• Benefits:

  • Objective

  • Specialized talent

  • Greater flexibility in scheduling studies and specific project requirements.

Ethical Questions in MR

Potential ethical pitfalls:

• Unethical pricing

• Unnecessary or unwarranted research services

• Client confidentiality issues

• Use of “black box” methodologies

Black Box Methodologies

Offered by research firms that are branded.

• Do not provide information about how the methodology works.

  • Ex: 4 out of 5 doctors said… we don’t know what the research process looked like.

Reasons for Conducting Research NOT Meeting Professional Standards

Reasons:

• Fearful of losing the business entirely.

• Client pressure to perform research to prove a predetermined conclusion.

• Cost cutting

• Interviewers working for research firms may also engage in unethical behavior.

  • Curbstoning

Curbstoning

Data collection personnel filling out surveys for fake respondents.

• Basically employees creating fake respondents so that they meet the amount of responses they needed for the survey/research.

Potential Abuse of Respondents

• Not providing promised incentive to respondents for completing interviews or questionnaires.

• Stating that interviews are very short when, they actually may last hours

• Using fake “sponsors”

• Physical or psychological harm (see Milgram)

Subject debriefing

Fully explaining to respondents any deception that was used during research.

Sugging/Frugging

Claiming that a survey is for research purposes and then asking for a sale or donation.

De-anonymizing Data

Combining different publicly available information, usually unethically, to determine consumers’ identities, especially on the internet.

Unethical Activities of the Client/Research User

• Requesting detailed research proposals from several research providers with no intention of selecting a firm to conduct the research.

• Promising a research provider a long-term relationship or additional projects to obtain low price on the initial research project.

• Overstating results of a marketing research project.

Unethical Activities by the Respondent

• Providing dishonest answers

  • Lying in order to participate (for incentives).

    • Ex: Doing sleep study only for the money, even though you don’t have trouble sleeping.

Emerging Trends

• Increased emphasis on secondary data

  • (Information previously collected for some other problem)

    • Increased use of gatekeeper technologies

      • Ex: Caller ID, blocking/deleting cookies

• Technology for info acquisition and data management

  • Ex: social media, clickstream tracking, GPS, neuromarketing.

  • Traditional methods will never be rendered obsolete

• Globalization

• Marketing research repositioned to play a more important role in strategy development.