Class 8 Marketing

Gathering Customer Insights 

  • An investment to reduce uncertainty 

  • Can help guide decisions on 

    • Whether to enter  

    • Product characcterisitics  

    • Promotional strategy  

    • Positioning  

  • Must weight costs and benefits of research  

    • Money  

    • Time spent  

Goals of research  

  • Situational research (3C's) 

    • To identify opportunities/threats  

    • To assess strengths/weaknesses 

  • Decision support research (STP and 4P's) 

    • Strategic: segmentation, targeting, positioning  

    • Tactical: product, price, place, promotion 

Marketing Research 

 

Types of data 

Primary data 

Advantages 

  • Allows investigation of specific issue of interest  

  • Often more specific results then secondary data  

  • Can look at what-if scenarios 

Disadvantages  

  • Expensive  

  • Time-consuming 

  • Many potential biases 

Examples: 

  • Survey 

  • Focus group/interviews 

  • Observation 

  • Experiments 

  • Test market 

Secondary data 

Advantages 

  •  Easy to find 

  •  Abundant 

  •  Can be low cost or even free 

  •  Can be more realistic of market behavior (scanner 

  • data) 

Disadvantages 

  • Not customized to your needs 

  •  Does not allow many/any what-if scenarios 

Examples 

  • Transaction data (scanners) 

  • Panel data 

  • Browsing/clickstream data (amazon) 

  • User generated content 

  • Mobile  

Attributes of good market research 

Reliability (receiving the right response) 

  • The degree to which measures are free from error and therefore give consistent results (ex. Would you get the same answer if you asked again?) 

  • Common reasons for low reliability: 

    • Poorly written itens 

    • Leading questions  

    • Sensitive questions 

    • Imposed time limits 

  • Ways of testing 

    • Repeatability: may be measured with the test-retest method, whereby the same scale or measure is administered to the same respondents at two separate points in time 

    • Internal consistency: may be measured by asking in multiple ways and combining responses (scales, IQ tests)  

Validity: asking the right question 

  • Are the questions you are asking getting at answer needed 

    • The focus here is not necessarily on scores or items, but rather inferences made 

  • Are you measuring the construct you think you are? 

    • Which package is prettiest =/= which package would make you more likely to purchase the product  

Generalizability: getting representative results 

  • Who to ask? Are they representative of the population of interest? 

    • Probable biases 

      • Current customers - extra favorable 

      • Ex-customers - extra unfavorable 

      • Opt-in - extreme views 

      • Specific times/places - specific characteristics  

        • Daytime= unemployed  

        • Internet = technologically savvy 

        • Movie theatre = movie lover 

  • How many people to ask  

    • Larger is better  

    • Amount needed depends on variability in responses  

    • Not dependent on size of total relevant population 

Surveys (primary data) 

Demand effects 

  • Demand effect: respondent answers in the way they believe they are expected to  

  • Being polite - leads to biased results  

  • Better: anonymous , use a comparative question, projection  

Difficulty in answering 

  • Willingness to pay: how much would you pay to save a panda 

  • Better: would you be willing to donate $X to sponsor the life of a panda  

Double barreled questions 

  • I felt welcomed by the staff and my needs were well taken care of  

  • Vs 

  • I felt welcomed by the staff 

  • My need were well taken care of  

Biases or leading questions 

  • How much more would you be willing to pay if your clothing was made in the United States? 

Order Effect 

  • Order of asking questions matters 

  • Asking questions about dating life then how happy you are  

    • Vis versa  

Focus groups/interviews (primary data) 

  • Focus groups and interviews vs surveys  

    • Always "exploratory research" or "qualitative research" 

      • Provide initial insights, ideas, or understanding  about a problem  

      • Should not be used too recommend final course of aciton  

    • Typically have much smaller samples 

    • Use a non-structured data collection procedures  

Depth interviews 

  • In-depth interviewing is qualitative research method that uses open-ended questions to uncover information on a topic of interest and allows interviewees to express opinions and ideas in their own words 

  • Often used when: 

    • Want respondents to be free from the influcences of others 

    • Sensitive topic  

Common applications  

  • Understanding Consumers 

    •  perceptions, opinions, and behaviors for products & services 

  • Product Planning 

    •  generating ideas about, or evaluating new products 

  • Advertising 

    • Develop creative concepts and evaluate copy material 

 

Observation   

  • Involves recording the behavioral patterns of people objects and events in systemic manner 

Casual research  

  • Experimentation involves the conscious manipulation of one or more variables y the experimenter in such a way that its effect on one or more variables can be measured 

Test market 

Advantages 

  • Can be more accurate in terms of buying realism 

  •  Can make revenue from the sales 

Disadvantages 

  •  Need to have the product and distribution channels ready 

What is the potential marketing research problem (reliability, validity, generalizability)? 

 

Secondary data 

  • Most helpful for situational market research  

  • Can be  

    • External  

    • Internal  

Analyzing data 

  • Definition: analysis of data is a process of inspecting, cleaning, transforming, and modeling data with the goal of discovering useful information, suggesting conclusions, and supporting decision-making  

Confirmation bias 

  • Looking for or using the statistics that only show desired results 

    • Can be intentional or malicious, but it does not need to be