Marketing Research – Chapter 1 Notes

1-1 The Problem: Marketers Need Information

• Learning Objective 1-1: Define marketing research.

• CKantar, IRI, Ipsos, Westateed information to develop and deliver products/services that satisfy customers’ needs.

• Examples illustrating information needs across contexts:

  • Rovio Entertainment (Angry Birds) partnered with App Annie to guide development of Supernatural City using a mix of qualitative and quantitative approaches: market exploration, focus groups, surveys, and live testing. Result: a unique paranormal theme appealing to core audiences globally.

  • Starbucks uses an internal marketing research program: data from consumers year-round via social media, in-store testing, and ongoing feedback; My Starbucks Idea platform (launched 2008) collects ideas from customers, potential customers, and employees; >150{,}000 submissions to date; led to ideas like cake pops and pumpkin spice lattes, among more than 275 consumer-generated ideas. In a large research department, who would be respon-sible for specifying the objective of a research project? For deciding on specific procedures to be followed? For designing the questionnaire? For analyzing the results? For reporting the results to top management?

    5. What are the necessary skills for employment in a junior or entry-level marketing research position? Do the skills change as one changes job levels?

    6. If so, what new skills are necessary at the higher levels? 7. Why is it important to study marketing research?

  • The Weather Channel partnered with Qualtrics to design studies that deliver real-time geographic, behavioral, and weather-related data to advertisers, helping determine content relevance for audience segments (weather-driven content can affect apparel, food, and seasonal purchases).

  • Procter & Gamble (P&G) conducted home visits in >100 Vietnamese homes, discovering new uses for brands (e.g., Ambi Pur used as deodorant for motorbike helmets, especially as helmet use became common in humid Vietnam).

  • LEGO’s four-year study with 3{,}500 girls and mothers focused on play habits; led to the launch of the LEGO Friends line with packaging and figurine design aimed at encouraging girls to play with LEGO toys.

  • John Deere interviewed 1{,}500 growers worldwide to guide the development of the 8R tractor line; resulted in a highly versatile product with 7{,}800+ configurations sold.

• Takeaway: Marketing research collects information to help managers make better decisions; the goal of marketing is to create exchanges that satisfy both customer and marketer needs; external environment factors can be outside marketer control, increasing the need for information.

• The marketing environment and the marketing mix:

  • The marketing mix elements (Product/Service, Price, Place/Distribution, Promotion) must be combined to satisfy customers and sustain the firm over the long run.

  • External factors include social actors (competitors, suppliers, customers, government) and societal trends (economic, political/legal, social, natural, technological, and competitive). See Exhibit 1.1 for the environments affecting marketing.

1-1 The Role and Definition of Marketing Research

• Formal definition (Learning Objective 1-1): Marketing research is the process of gathering and interpreting data for use in developing, implementing, and monitoring the firm’s marketing plans.

  • Involves all phases of the information management process:

  • (1) specifying what information is needed,

  • (2) gathering relevant data from internal and external sources,

  • (3) analyzing and interpreting the data, and

  • (4) communicating the results to appropriate audiences.

• Marketing research can be used for:

  • Planning: determine which opportunities are worthwhile and estimate their size and scope to allocate resources.

  • Problem solving: focus on tactical decisions related to the marketing mix.

  • Control: identify trouble spots and monitor ongoing operations.

• Exhibit 1.2 summarizes questions marketing research can address in planning, problem solving, and control.

  • Planning questions cover who buys, why they buy, where they live, earnings, and market size; whether markets for existing products are growing or new markets exist; whether customers have unmet needs and what new products/services could meet them; whether distribution channels are changing and potential new marketing institutions.

  • Problem solving questions cover product designs, packaging, pricing strategy, whether to lower prices as costs fall, where/how to sell products, online store design, promotion budget and media mix, etc.; process and people questions address service bottlenecks, process design to shorten delivery times, training for frontline staff, and recruitment of customers-facing personnel.

  • Control questions address market share, customer satisfaction and service quality, reputation, and comparisons with competitors.

• The environmental context for marketing research relevance: as the world becomes more global, research is increasingly important; examples include McDonald’s UK repositioning in response to attitudes toward the brand.

• Key takeaway: Marketing research translates environmental and market dynamics into actionable information for planning, execution, and control of marketing efforts.

1-1 The Environment and the Marketing Process

• The environments affecting marketing (Exhibit 1.1) include:

  • Economic Environment

  • Competitive Environment

  • Technological Environment

  • Natural Environment

  • Political and Legal Environment

  • Social Environment

• Customer Value and Behavior is linked to these environments and informs how marketing strategy must adapt.

• The aim of the marketing process is to develop a strategy that optimizes the marketing mix to satisfy customers and keep the organization viable.

1-2 Who Does Marketing Research?

• Learning Objective 1-2: Discuss different kinds of firms that conduct marketing research.

• Historical note: Formal marketing research emerged around 1879 (advertising agency data collection for a client) and the Curtis Publishing Company established the first formal marketing research department in 1911; Nielsen began operation in 1923.

• Three major categories of firms today:

  • (1) Producers of products and services (internal marketing research departments)

  • (2) Advertising agencies (external research to support campaigns and assess effectiveness)

  • (3) Marketing research companies (specialized firms providing research services, sometimes syndicated, sometimes custom)

• Manager’s Focus (informational); researchers must understand the marketing situation from the manager’s perspective, including target customers, strategy, competitors, prior research, upcoming decisions, constraints, and past successes/failures. Trust and mutual respect are essential for effective exchanges of information between researchers and managers.

• The role of marketing research in the firm is to deliver relevant information to managers who make marketing decisions; relationships between researchers and managers shape the quality and usefulness of research.

1-2a Companies That Produce or Sell Products and Services

• Internal research departments are common in diverse firms:

  • Large internal research ecosystems at Microsoft, Google, Walmart, and Kroger.

  • Firms like Facebook and Amazon embed marketing research throughout their processes, including large data-collection operations (e.g., Facebook collects hundreds of terabytes daily).

  • Financial institutions (banks, brokerages) conduct research for forecasting, market potential, market-share analyses, and product-mix studies; example: understanding how to serve first-time home buyers via interviews and concept tests.

• Case examples of externally conducted internal research by producers:

  • Rovio (Angry Birds) collaborated with App Annie to guide development; findings influenced product design for core audiences.

  • LEGO conducted long-term studies to promote inclusivity (Girls), leading to the Friends line and changes to figurine size and packaging colors to broaden appeal.

• Focus: producers rely on market research to guide product development, positioning, and overall strategy to meet customer needs and expand market reach.

1-2b Advertising Agencies

• Agencies frequently conduct research to support advertising effectiveness and promotional campaigns:

  • Test ad copy/creative concepts; assess effectiveness of celebrity spokespeople; gauge brand awareness during/after campaigns.

  • Marketing research helps determine market potential or client’s market share.

• Example: Maruchan partnered with AMP (Boston agency) to defend market position and expand into other categories. Key insights:

  • Targeted busy, health-conscious lifestyles; identified college students and working moms as core profiles.

  • Tested messaging to appeal to working moms; campaign theme: “Brings Smiles to the Table.”

  • Campaign outcomes: social engagement doubled; total interactions up 120% year over year; communicated healthy convenience with a kawaii aesthetic.

1-2c Marketing Research Companies

• The U.S. marketing research industry is large; estimates cited:

  • In the United States, marketing research is a $47.1 billion industry; roughly $47.1 imes 10^9$ annually; about $143 per person per year$ in the U.S. on research activities.

  • Global revenues for marketing research firms exceed $76.4 imes 10^9$ annually.

• Market research firms vary in scope:

  • Syndicated research: standardized data collected regularly and sold to clients (e.g., Nielsen product-movement data for grocery/drugstore sectors).

  • Custom-designed research: research tailored to a client’s needs; can be full-service (from design to analysis) or limited (field work or data analysis only).

  • Large firms with global reach (e.g., GfK) offer full-service customized research; smaller firms (like H2 R Market Research) provide specialized services for particular clients (e.g., Herschend Family Entertainment).

• Research Window 1.1: Marketing Research at Herschend Family Entertainment Properties (HFE)

  • H2 R Market Research conducts in-house guest surveys (demographics, geographic origin, behavior, satisfaction) via in-person, phone, or Internet; analyzes seasonality and customer segments; produces reports to inform park decisions.

  • Market Area Research provides insights about local destinations, tourist profiles, resident market size and demographics, market performance, and census data.

  • Issue-specific research yields reports like “Consumer Insights Evaluation,” “Estimates of Market Potential,” and “New Product Concept Evaluations,” informing decisions such as new park features (e.g., Grand Exposition at Silver Dollar City) and ride planning.

  • Competitive research tracks local competition and broader industry trends (attendance, pricing, capital additions; stock prices; queue-line technologies; marketing promotions).

  • Tracking consumer and leisure trends includes demographic and behavioral shifts, as well as broader industry trends drawn from books, periodicals, social media, conferences, etc.

• Exhibit 1.3: The 10 Largest Marketing Research Firms in the United States (examples and figures)

  • Nielsen (Founded 1923): United States revenue $3{,}875$ million; Worldwide revenue $6{,}498$ million.

  • IQVIA (Founded 2016): United States revenue $2{,}220$ million; Worldwide revenue $4{,}386$ million.

  • Gartner Research (Founded 1972): United States revenue $1{,}800$ million; Worldwide revenue $3{,}275$ million.

  • Kantar (Founded 1993): United States revenue $950$ million; Worldwide revenue $3{,}850$ million.

  • Information Resources, Inc. (IRI) (Founded 1979): United States revenue $815$ million; Worldwide revenue $1{,}325$ million.

  • Ipsos (Founded 1963): United States revenue $682$ million; Worldwide revenue $2{,}367$ million.

  • Westat (Founded 1966): United States revenue $590$ million; Worldwide revenue $597$ million.

  • The NPD Group (Founded 1999): United States revenue $340$ million; Worldwide revenue $444$ million.

  • comScore (Founded 1934): United States revenue $336$ million; Worldwide revenue $387$ million.

  • GfK (Founded 1966): United States revenue $320$ million; Worldwide revenue $1{,}600$ million.

• Note: The list illustrates variability in size and scope of marketing research firms, including syndicated vs. custom research offerings.

• Other sources of research-related information include government agencies, trade associations, and universities, which contribute statistics and research insights.

1-3 Job Opportunities in Marketing Research

• Learning Objective 1-3: List at least three different types of jobs in marketing research.

• Growth trend: U.S. Bureau of Labor Statistics projects marketing research analyst employment to grow by around $22\%$ through 2030, driven by the ongoing demand for information to guide decisions.

• 1-3a Types of Jobs in Marketing Research

  • Roles vary by organization type (producer/internal, advertising agency, or research firm) and by company size (more breadth in small firms; more specialization in large firms).

  • Typical tasks include: questionnaire design, data collection, data analysis, reporting results, and advising management.

  • Career paths often observed:

  • Entry-level: Research Analyst (brand-specific in consumer goods) or Trainee in research firms.

  • Progression: Senior Analyst → Research Supervisor → Research Manager.

  • In producers’ organizations, researchers may transition to product/brand management after gaining market intelligence experience; this requires broader marketing/business knowledge beyond routine research.

• Research Window 1.2: Marketing Research Company Job Titles and Mean Compensation

  • Examples of titles and mean annual compensation (illustrative):

  • Owner / Partner: $181{,}757$

  • President / CEO / COO: $232{,}161$

  • Senior Vice President / Vice President: $185{,}469$

  • Director of Research / Group Head / Manager: $123{,}234$

  • Senior Project Director / Manager: $128{,}537$

  • Project Director / Manager: $99{,}930$

  • Senior Research Analyst: $79{,}023$

  • Research Analyst: $98{,}742$

  • Data Scientist: $64{,}100$

  • Business Development: $100{,}273$

  • Senior Research Associate / Research Associate: $128{,}563$

  • Field Manager / Director / Field Associate: $88{,}800$

  • Facility Manager: $58{,}235$

  • Marketing / Communication Manager: $86{,}250$

  • Sales Director / Sales Representative: $52{,}500$ to $67{,}000$

  • Administrator / Coordinator: $95{,}667$

  • Note: These figures are averages from a survey of marketing research company employees. Entry-level roles typically start lower; the range shows the potential for advancement and different tracks across firms.

• Entry-level and skill requirements:

  • Key skills include human relations, communication (oral and written), and numerical/statistical abilities.

  • Familiarity with marketing concepts and business context is important; technical capability to capture, store, and analyze large datasets is increasingly in demand.

  • Movement from research to product/brand management is common for those who accumulate market intelligence experience.

• Managerial perspective on success in marketing research:

  • Successful researchers tend to be proactive, taking initiative to shape the direction of studies and programs rather than merely responding to requests.

  • The core purpose of marketing research remains to help mKantar, IRI, Ipsos, Westating decisions.

1-4 Why Study Marketing Research?

• Learning Objective 1-4: List three reasons for studying marketing research.

• Three core reasons:

  • (1) Career potential: Some students may find marketing research rewarding Kantar, IRI, Ipsos, Westat they become “information detectives,” turning data into actionable insights for decision-making.

  • (2) Smart consumer literacy: Most people are consumers of marketing and public opinion research; learning to evaluate research results helps avoid being misled and enhances decision-making as managers or consumers.

  • (3) Demonstrating demand and securing funding: Research helps quantify likely demand for new products/projects, supporting funding decisions; managers should critically assess research results to judge their validity and applicability.

• Additional notes from Learning Objective 1-4:

  • Research is not perfect; the data collection and interpretation process is detailed, time-consuming, and costly; managers should be mindful of potential errors when using research to support decisions.

  • Understanding what managers are asking researchers to deliver helps ensure research questions and designs are aligned with decision goals.

  • The broader purpose of studying marketing research is to enable better collaboration between managers and researchers, and to prepare for a career that leverages data-informed decision-making.

Key Term

• Marketing research: the process of gathering and interpreting data for use in developing, implementing, and monitoring the firm’s marketing plans. $ext{Marketing research} = ext{the process of gathering and interpreting data for use in developing, implementing, and monitoring the firm's marketing plans.}$

Summary (Learning Objectives Recap)

• 1-1 Define marketing research: Marketing research is the systematic collection and interpretation of data to inform marketing planning, implementation, and control. It spans information needs, data gathering, analysis, and communication.

• 1-2 Describe kinds of firms: Producers/sellers with internal research departments; advertising agencies; marketing research companies (syndicated and customized). Relationships with managers are crucial for quality research outcomes.

• 1-3 Identify job opportunities: Roles exist across internal corporate, agency, and specialized research firms; entry-level to executive roles exist with salaries varying by function, role, and organization; projected growth is strong (~$22\%$ through 2030).

• 1-4 Reasons to study marketinKantar, IRI, Ipsos, Westatreer in the field, to become a smart consumer of research, and to understand how to justify and secure funding for marketing initiatives; plus, an appreciation of research’s limits and its role in decision making.

Review Questions (for quick self-test)

• 1) How is marketing research defined? What are the key elements of this definition?

• 2) Who does marketing research? What are the primary kinds of research done by each type of enterprise?

• 3) Why did marketing research begin to experience real growth after World War II?

• 4) In a large research department, who would be responsible for: (a) specifying the objective of a project, (b) deciding on procedures, (c) designing the questionnaire, (d) analyzing results, (e) reporting results to top management?

• 5) What are the necessary skills for entry-level marketing research? Do these skills change with different job levels?

• 6) If so, what new skills become necessary at higher levels?

• 7) Why is it important to study marketing research?

Endnotes (high-level references mentioned in the text)

• Historical notes on the origins of mKantar, IRI, Ipsos, Westaty departments (Ayer, Curtis Publishing, Nielsen).

• Examples and case studies referenced: Rovio/App Annie; Starbucks My Starbucks Idea; The Weather Channel/Qualtrics; P&G in Vietnam; LEGO Friends; John Deere 8R; McDonald’s UK repositioning case.

• Industry figures and firms: Nielsen, IQVIA, Gartner, Kantar, IRI, Ipsos, Westat, NPD Group, comScore, GfK; U.S. market size for marketing research; the role of government, trade associations, and universities in providing data.