MOS 1021 HR/Consumer Behaviour - Chapter 10&12

What is Market Research?

Process of collecting and analyzing information in order to recommend actions to improve marketing activities

Systematic process

What the are 3 different research classifications?

1. Exploratory Research

2. Descriptive Research

3. Causal Research

What is Exploratory Research?

Preliminary research conducted to clarify the scope/nature of a marketing problem

- broad/non-specific

- NOT conclusive

What is Descriptive Research?

Research designed to describe basic characteristics of variables

- Looking for IV or DV

What is Causal Research?

a.k.a Explanatory Research

research designed to identify cause-and-effect relationships among variables

- finding actual causal connections

what are the 5 different steps of the Market Research Process?

1. Problem Awareness

2. Exploratory Research

3. Quantitative research

4. Analyze & Interpret

5. Recommend & Implement

MARKET RESEARCH PROCESS: Problem Awareness

Pinpoint challenge, issues, opportunity that needs further understanding

- identify research objectives

Objectives

clarify what the research process is trying to achieve

MARKET RESEARCH PROCESS: Exploratory Research

A preliminary form of research that clarifies the nature of a problem (through informal analysis, often referred to as the funnelling process)

- obtain richer info

- identify key variables

- inform research strategy

Funnelling

Dividing a subject into manageable variables so that specifically directed research can be conducted. (accomplished through situation analysis)

Situation Analysis

Collecting information from knowledgeable people inside and outside the organization and from secondary sources.

What are the 2 types of data?

1. Primary

2. Secondary

What is Secondary Data?

Previously collected/complied and available to researcher (secondary first, then primary)

What are the 2 sources of Secondary Data?

1. Internal Data Sources

2. External Data Sources

What are Internal Data Sources?

Available through published sources outside of the org

(e.g. sales reports, inventory analysis, marketing budgets)

What are External Data Sources?

Available through published sources outside of the organization

- e.g. government (statsCan), academic, commercial(Nielsen)

Online Databases

A public information database accessible to anyone with proper communication facilities

Directory Databases

A commercial database that provides that provides quick information about a company (e.g. size, sales. location, and number of employees)

What is Primary Data?

Data collected by researcher to address specific objectives

- specific but time-consuming

- data are largely qualitative in nature

Research Objectives

Statements that outline what the research is to accomplish

Hypotheses

Statements of predicted outcomes (confirmed or refuted by the data collected)

Primary Data: FOCUS GROUP

Small group of participants with common characteristics (usually 8-10)

- meet with a trained moderator

- interactive discussion of predetermined topics (often recorded)

- taxing on time and resources

- quantitative data

Primary Data: ONLINE BULLETIN BOARDS

- private online forums

- participants log on at own convenience and respond to questions posed by researchers (usually 15-30)

- convenient and anonymous

- may exclude participants who aren't tech savvy

Primary Data: SOCIAL LISTENING

Monitor social media channels for mentions of your brand (social monitoring)

Analyze/Organize online conversation and information:

- metric and analytics

- social media sentiment

MARKET RESEARCH PROCESS: Quantitative Research

Refine objectives to form research question

- identification of hypotheses (statement of predicted outcomes)

- collection of numerical data from larger samples using structured formats

(also select sample size)

Sample Design includes what 3 major terms?

1. Population

2. Sample

3. Sampling

SAMPLE DESIGN: population

all individuals making up a group of interest

SAMPLE DESIGN: sample

subset of individuals making up a group of interest (ideally representative)

SAMPLE DESIGN: sampling

process through which a subset of individuals is taken from a larger population

What are the 2 main Sample Designs?

1. Probability Sampling

2. Non-probability Sampling

Probability Sampling?

Participants are randomly selected from the population

- have equal probability of being selected

Non-probability sampling?

Participants are selected based on non-scientific criteria

- do not have equal probability of being selected

e.g. convenience sampling

MARKET RESEARCH PROCESS: What are the 4 types of Data Collection?

1. Observational

2. Survey

3. Survey Panel

4. Experiments

DATA COLLECTION: Observational

Obtained by watching how people behave either in person or by electronic means (i.e. recording).

In what types of settings can observational data collection occur?

Natural or contrived settings.

What can be observed through observational data collection?

Product selection, use, and reaction to marketing strategy.

What is a scoring system used for in observational data collection?

To track key behaviors.

What is ideal for observational data collection?

Multiple observers.

Ethnographic Research

the study of human behaviour in its natural context; involves observation of behaviour and physical setting

DATA COLLECTION: Survey

Posing standardized questions to participants

What is Fixed-Response Questioning?

Questionnaire used for a large sample that contains predetermined questions and a choice of answers that are easily filled in by the respondent or interviewer

What is a Structured Survey?

Follows a planned format: screening, questions at the beginning, central-issue questions in the middle, and classification questions at the end

- this style is most popular

What is a Unstructured Survey?

Gives researcher some leeway in determining how the questions are asked; questions may be open-ended

SURVEY: In-person

- non-verbal cues can be monitored

- interviewer bias possible

- can occur in formal or non-formal settings

SURVEY: Telephone

- Geographic flexibility

- considered by some to be intrusive

- response rate around 9%

- MUGGING

MUGGING

fraudulent marketing under the guise of interviewing, in which seller pretend to be conducting a market research interview

SURVEY: Mail

- low pressure (more thoughtful/accurate responses)

- cost-efficient

- can lead to lengthy study

SURVEY: Online

- convenient and inexpensive

- careless respodning possible

- CONCEPT TEST: presentation of a product idea in some visual form, with a description of the basic product characteristics and benefits, in order to get customer reactions

What are the 3 main factors used to determine which survey technique to use?

1. Nature of Information sought

2. Cost and Time

3. Respondent

DATA COLLECTION: Survey Panel

Large sample of respondents (panel) that voluntarily competes questionnaires on a regular basis

- can assess changes in behaviour and attitudes

- longitudinal data collection (versus cross-sectional)

-Retention of respondents can be difficult

Longitudinal Data collection

any data that has been collected through repeated testing of same variable of same participants over time

DATA COLLECTION: Experiments

Assessing whether one variable (IV) has a causal effect on another variable (DV)

- participants are randomly assigned to a test group

- each test group received a different treatment representing a level of the IV

- all participants are measured on the same DV

- DV's are compared across test groups

Test Marketing

form of experimental research; places a product for sale in one or more representative markets to observe performance under proposed marketing plan

MARKET RESEARCH PROCESS: Analyze and Interpret

Statistically analyze the collected data

- synthesize and simplify

- address the guiding hypothesis

MARKET RESEARCH PROCESS: Recommend & Implement

Prepare a report to communicate the research findings

- include recommendations that address the marketing problem and research objectives

- continue to monitor

What is Market Segmentation?

Process of dividing potential customers into groups based on shared characteristics

- groups composed of individuals who will respond similarly to marketing strategies who have common needs

- want to identify HIGH-YIELD SEGMENTS (commonly TM)

What are the 4 types of Segmentation?

1. Geographic

2. Demographic

3. Psychographic

4. Behaviour Response Segmentation

SEGMENTATION: Geographic

People grouped based on geographics

- country/province/city

- region

- population density

- climate zone

Geo-demographic segmentation

the isolation of dwelling areas through a combination of geographic and demographic information, based on the assumption that people seek out residential neighbourhoods in which to cluster

SEGMENTATION: Demographic

People are grouped based on demographics (basic characteristics):

- age

- gender

- ethnic background

- religion

- income

- occupation

- education

- marital status

- household formation

SEGMENTATION: Psychographic

People grouped based on psychographics (psychological attributes):

- personality traits

- values

- interests/hobbies

- lifestyle

SEGMENTATION: Behaviour Response

people grouped based on behaviouristics (buying/consumption behaviour):

- benefits sought

- frequency of use

- occasions for us

- loyalty response

Target Market Profile

Describes the ideal customer around which the marketing strategy will be devised and delivered (emerges from thorough analysis)

What are the 3 ways of Marketing to Segments?

1. Mass Marketing

2. Niche Marketing

3. Individual Marketing

Mass Marketing (undifferentiated marketing, shot-gun marketing)

One marketing strategy intended to appeal to all customers

- aiming to reach largest audience possible

-building brand image and recognition

Niche Marketing (sub-segmentation)

Targeting a product line to one particular sub-segment and committing all marketing resource to that satisfaction of that sub-segment

- often little competition

- customers may be willing to pay more

- optimized form of segmentation

What is individual marketing?

A situation in which unique marketing programs are designed to meet the needs and preferences of individual customers.

What does individual marketing deliver to customers?

Individualized messages and product offerings.

How does individual marketing affect the relationship between customer and brand?

It creates a more personal relationship.

What role does technology play in individual marketing?

Technology makes individual marketing easier.

Behavioural Targeting (IM)

database-driven marketing system that tracks a consumers' behaviour to determine his or her interest and then serves ads to that person relevant to those interest

Geo-targeting (IM)

practice of customizing an ad for a product or service to a specific market based on the geographic location of potential buyer

Location-based targeting (IM)

effort to integrate consumers' location information into a marketing strategy (current location as opposed to more broad)

Mass Customization (IM)

creation of systems that can produce products, and personalize messages to a target audience of one

Brand Democratization (IM)

situation in which the customer can interact with a brand, giving the customer some control over the marketing of a brand (as in online user-generated content)

What 3 steps does segmentation involve?

1. Identifying market segments

2. Selecting the market segment that offers the most potential

3. Positioning the product so that it appeals to the target market

What are key trends to consider when identifying target markets in Canada?

1. Aging population

2. Social responsibility

3. New household formations

4. Ethnic diversity

What is Positioning?

- impression of the product you want to establish in customers' mind

- clarification of how product/brand stands apart from competitors

- emphasize distinguishing features of the product/brand

What 2 things does positioning involve?

1. Designing and marketing a product to meet the needs of a TM

2. Creating appropriate appeals to make the product stand out from competition in minds of TM

What is a Positioning Statement?

- clear, focused, concise

- how you want your brand/product to be perceived

What 5 things does a Positioning Statement include?

1. name

2. category (type of product)

3. target market

4. benefits

5. differentiation

What is a positioning map (perceptual maps)?

visual representation of the place that a product occupies within a category

- aces represent two key attributes

- product is plotted in relation to competitors

- created on basis of customer perception

- beneficial for identification of gaps in market, clarifying competition

What are the 5 different types of Positioning?

1. Head-On Positioning

2. Brand Leadership Positioning

3. Product Differentiation Positioning

4. Technical Innovation Positioning

5. Lifestyle Positioning

What is Head-On Positioning?

Marketing strategy in which one brand is presented as an equal or better alternative to a competing brand

- common for challenger brands

What is Brand Leadership Positioning?

Marketing strategy in which the brand leader markets itself as such, solidifying its its dominant position and wide acceptance

- highlights market leadership and acceptance

What is Product Differentiation Positioning?

Marketing strategy that focuses squarely on the unique attributes or benefits of a product - features that distinguish one brand from another

What is Technical Innovation Positioning?

Marketing strategy that puts a company's technical innovation at the forefront of its strategy

What is Lifestyle Positioning?

Market Strategy intended to "fit in" with a target market's lifestyle (psychographic)

- lifestyle and emotional appeal

What is Repositioning?

changing the place a product occupies in the consumer's mind, relative to competitive products

What are the 2 main reasons for Repositionings?

1. Marketing activities of direct competitor may change

2. Preferences of the TM may change

What is Experimental Research?

Research where one or more factors are manipulated under controlled conditions, observing reactions while keeping other variables constant

What is Test Marketing?

Introducing a product to a limited, representative market to evaluate performance under a planned marketing strategy

What are the 3 benefits of Test Marketing?

1. Consumer reaction: observe how consumers respond to new products

2. Evaluate Marketing Strategies: test alternatives approaches (pricing, advertising)

3. Consumer Profiling: identify demographic (Age, income) and lifestyle traits of potential buyers

What are Attention Check Items in Surveys?

questions inserted into online surveys to confirm respondents are genuinely attentive and following instructions