Chapter 9: Decision Support Systems and Marketing Research Prepared by Amit Shah, Frostburg State University Designed by Eric Brengle, B-books, Ltd. Copyright

Chapter 9: Decision Support Systems and Marketing

Research

Prepared by Amit Shah, Frostburg State University

Designed by Eric Brengle, B-books, Ltd.

Copyright 2010 by Cengage Learning Inc. All Rights Reserved 1

Learning Outcomes

2

Explain the concept and purpose of a marketing decision support system

Define marketing research and explain its importance to marketing decision making

Describe the steps involved in conducting a marketing research project

LO1

LO2

LO3

Copyright 2010 by Cengage Learning Inc. All Rights Reserved

Learning Outcomes

3

Discuss the profound impact of the Internet on marketing research

Discuss the growing importance of scanner-based research

Explain the concept of competitive intelligence

LO5

LO6

LO4


Marketing Decision Support Systems

4

Explain the concept and purpose of a

marketing decision support system.

LO1



5

An interactive, flexiblecomputerized information systemthat enables managers to obtainand manipulate information as

they are making decisions.


DSS System Characteristics

6

InteractiveInteractive

FlexibleFlexible

Discovery-OrientedDiscovery-Oriented

AccessibleAccessible



7

Database Marketing - The creation of a large computerized file of customers’ and potential

customers’ profiles and purchasepatterns.

The key tool for successful one-to-one marketing.


Review Learning OutcomeMarketing Decision Support Systems

8

LO1


The Role of Marketing Research

9

Define marketing research and explain its importance to marketing decision making.

LO2



10

The process of planning,

collecting, and analyzing

data relevant to a

marketing decision.


Marketing Research Studies

11

ProductsProducts

AdvertisingAdvertising

PricesPrices

PackagesPackages

Names and LogosNames and Logos

ServicesServices

Buying habitsBuying habits

ColorsColors

UsesUses

AwarenessAwareness

FamiliarityFamiliarity

New conceptsNew concepts

Traffic patternsTraffic patterns

WantsWants

NeedsNeeds

PoliticsPolitics



12

Diagnostic

Predictive

Descriptive Gathering and presenting

factual statements

Explaining data

“What if?”


Management Uses of Marketing Research

13

Improve the quality of decision making

Trace problems

Focus on keeping existing customers

Understand the marketplace

Alert them to marketplace trends

Gauge the value of goods and services, and the level of customer satisfaction


Review Learning OutcomeMarketing Research and Its Importance

14

LO2

Why marketing research? Improve quality of decision making

Trace problems

Focus on keeping existing customers

Understand changes inmarketplace


Steps in a Marketing Research Project

15

Describe the steps involved in conducting

a marketing research project.

LO3


The Marketing Research Process

CollectData

CollectData

SpecifySamplingProcedure

SpecifySamplingProcedure

Plan Design/Primary DataPlan Design/Primary Data

Identify theProblem

Identify theProblem

AnalyzeData

AnalyzeData

Prepare/PresentReport

Prepare/PresentReport

Follow UpFollow Up

1

23

4

5

6

7


Marketing Research

17

Marketing Research Problem

Marketing Research Problem

MarketingResearch Objective

MarketingResearch Objective

Management Decision Problem

Management Decision Problem

Determining what information is needed and how that information can be

obtained efficiently and effectively.

Determining what information is needed and how that information can be

obtained efficiently and effectively.

The specific information needed to solve a marketing research problem; the objective should provide insightful

decision-making information.

The specific information needed to solve a marketing research problem; the objective should provide insightful

decision-making information.

A broad-based problem that requires marketing research in order for managers to take proper actions.

A broad-based problem that requires marketing research in order for managers to take proper actions.


Secondary Data

18

Data previously collected for any purpose other than

the one at hand.


Sources of Secondary Data

19

Government AgenciesGovernment Agencies

Trade and Industry AssociationsTrade and Industry Associations

Business PeriodicalsBusiness Periodicals

News MediaNews Media

Internal Corporate InformationInternal Corporate Information


Advantages of Secondary Data

• Saves time and money if on target

• Aids in determining direction for primary data collection

• Pinpoints the kinds of people to approach

• Serves as a basis of comparison for other data

20Copyright 2010 by Cengage Learning Inc. All Rights Reserved

Disadvantages of Secondary Data

• May not give adequate detailed information

• May not be on target with the research problem

• Quality and accuracy of data may pose a problem


Planning the Research Design

22

Which research questions

must be answered?

How and whenwill data be gathered?

How willthe data

be analyzed?

?


Primary Data

23

Information collected for the first time.

Can be used for solving theparticular problem under

Investigation.


Advantages of Primary Data

• Answers a specific research question

• Data are current

• Source of data is known

• Secrecy can be maintained


Disadvantages of Primary Data

• Expensive

• “Piggybacking” may confuse respondents

• Quality declines if interviews are lengthy

• Reluctance to participate in lengthy interviews

25

Disadvantages are usually offset by the advantages of primary data.


Survey Research

26

The most popular technique for gathering

primary data in which a researcher interacts with people

to obtain facts, opinions, andattitudes.


Forms of Survey Research

27

Focus GroupsFocus Groups

Executive InterviewsExecutive Interviews

Mail SurveysMail Surveys

Telephone InterviewsTelephone Interviews

Mall Intercept InterviewsMall Intercept Interviews

In-Home InterviewsIn-Home Interviews



28

Mall Intercept Interview- Survey research method that involves

interviewing people in the commonareas of shopping malls.

Executive Interview- A type ofsurvey that involves interviewingbusinesspeople at their officesconcerning industrial products

or services.



29

Focus Groups - Seven to ten peoplewho participate in a group

discussion led by a moderator.


Questionnaire Design

30

Open-EndedQuestion

Open-EndedQuestion

Closed-EndedQuestion

Closed-EndedQuestion

Scaled-Response Question

Scaled-Response Question

An interview question that encourages an answer phrased in respondent’s

own words.

An interview question that encourages an answer phrased in respondent’s

own words.

An interview question that asks the respondent to make a selection

from a limited list of responses.

An interview question that asks the respondent to make a selection

from a limited list of responses.

A closed-ended question designed to measure the intensity

of a respondent’s answer.

A closed-ended question designed to measure the intensity

of a respondent’s answer.


Questionnaire Design

31

Clear and conciseClear and concise

No ambiguous languageNo ambiguous language

UnbiasedUnbiased

Reasonable terminologyReasonable terminology

Only one questionOnly one question


Observation Research

32

A research method that relies on four types of observation:

• people watching people• people watching an activity• machines watching people• machines watching an activity


Observational Situations

Situation

People watching people

People watching phenomena

Machines watching people

Machines watching phenomena

Example

Mystery shoppers in a supermarket

Observer at an intersection counting traffic

Video cameras recording behavior

Traffic-counting machine monitoring traffic flow


Ethnographic Research

34

The study of human behavior in its natural context;

involves observation ofbehavior and physical setting.


The Sampling Procedure

35

SampleSample

UniverseUniverse

A subset from a large population.A subset from a large population.

The population from which a sample will be drawn.

The population from which a sample will be drawn.


Sampling Procedure

36

UniverseUniverse SampleSample

Probability Samples

Probability Samples

Non-Probability Samples



Types of Samples

37

Probability Samples

Probability Samples

Simple Random Sample

Simple Random Sample

Stratified Sample

Stratified Sample

Cluster Sample

Cluster Sample

SystematicSample

SystematicSample



Convenience Sample

Convenience Sample

JudgmentSample

JudgmentSample

Quota SampleQuota Sample

SnowballSample

SnowballSample


Probability Samples

38

ProbabilitySample

ProbabilitySample

A sample in which every element in the population has a known statistical likelihood of being

selected.

A sample in which every element in the population has a known statistical likelihood of being

selected.

Random Sample

Random Sample

A sample arranged so that every element of the population has an equal chance of being selected.

A sample arranged so that every element of the population has an equal chance of being selected.


Nonprobability Samples

39

NonprobabilitySample

NonprobabilitySample

Convenience Sample

Convenience Sample

Any sample in which little or no attempt is made to get a

representative cross-section of the population.

Any sample in which little or no attempt is made to get a

representative cross-section of the population.

A form of nonprobability sample using respondents who are

convenient or readily accessible to the researcher.

A form of nonprobability sample using respondents who are

convenient or readily accessible to the researcher.


Types of Errors

40

Measurement Error

Measurement Error

Error when there is a difference between the information desired and the

information provided by research

Error when there is a difference between the information desired and the

information provided by research

Sampling Error

Sampling Error

Error when a sample somehow does not represent the target population.

Error when a sample somehow does not represent the target population.

Frame Error

Frame Error

Error when a sample drawn from a population differs from the

target population.

Error when a sample drawn from a population differs from the

target population.

Random Error

Random Error

Error because the selected sample is an imperfect representation of

the overall population.

Error because the selected sample is an imperfect representation of

the overall population.


Field Service Firms

• Focus group facilities

• Mall intercept locations

• Test product storage

• Kitchen facilities

41

Provide:Provide:


Analyzing the Data

42

Cross-Tabulation - A method ofanalyzing data that lets the analyst

look at the responses to one question in relation to the responses

to one or more other questions.


Preparing and Presenting the Report

• Concise statement of the research objectives

• Explanation of research design

• Summary of major findings

• Conclusion with recommendations


Following Up

• Were the recommendations followed?

• Was sufficient decision-making information included in the report?

• What could have been done to make the report more useful to management?


Review Learning Outcome

45

LO3

Steps in a Marketing Research Project


Impact of the Internet on Marketing Research

46

Discuss the profound impact of

the Internet on marketing research.

LO4


Impact of the Internet

• Allows better and faster decision making

• Improves ability to respond quickly to customer needs and market shifts

• Makes follow-up studies and tracking research easier

• Slashes labor- and time-intensive research activities and costs


Advantages of Internet Surveys

48

Contact with the hard-to-reach

Contact with the hard-to-reach

Improved respondent participation

Improved respondent participation

Personalized questions and data

Personalized questions and data

Dramatically reduced costsDramatically reduced costs

Rapid development,real-time reporting

Rapid development,real-time reporting


Uses of the Internet by Marketing Researchers

49

Other types of marketing research Other types of marketing research

Conduct focus groupsConduct focus groups

Administer surveysAdminister surveys


Process for Online Focus Groups

50

1. Build a database of respondents via Web site screening questionnaire

2. Identify qualified individuals via e-mail

3. Develop a discussion guide

4. Moderator runs group by typing in questions online for all to see

5. Environment is similar to a chat room

6. Firm captures the complete text of the focus group


Types of Online Focus Groups

51

Real-time online focus groupsReal-time online focus groups

Time-extended online focus groupsTime-extended online focus groups


Advantages of Online Focus Groups

• Speed• Cost-effectiveness• Broad geographic

scope• Accessibility• Honesty


Role of Consumer Generated Media in Marketing Research

• CGM is media which consumers generate themselves and share among themselves

• Companies can identify the most influential bloggers and learn exactly what they are saying (and how they are saying it).


Other Uses of the Internet byMarketing Researchers

54

Viewing of presentations ofmarketing research surveysViewing of presentations ofmarketing research surveys

Publication and distributionof reportsPublication and distributionof reports

Data management and online analysisData management and online analysis

Collaboration between client and research supplierCollaboration between client and research supplier

Distribution of requests for proposals (RFPs) and proposalsDistribution of requests for proposals (RFPs) and proposals


Review Learning OutcomeImpact of the Internet on Marketing Research

55

LO4


Scanner-Based Research

56

Discuss the growing importance of

scanner-based research.

LO5


Scanner-Based Research

57

A system for gathering informationfrom a single group of

respondents by continuouslymonitoring the advertising,

promotion, and pricing they areexposed to and the things they

buy.

•BehaviorScan•InfoScan


When Should Marketing Research Be Conducted?

58

Where there is a high level of uncertainty

When value of research information exceeds the cost of generating the information


Review Learning OutcomeScanner-Based Research

59

LO5

BehaviorScan InfoScan

Panel information fromSpecific groups of people,enables researchers to manipulate variables and seereal results

Aggregate consumerinformation on allbar-coded products


Competitive Intelligence

60

Explain the concept of competitive intelligence.

LO6


Competitive Intelligence

61

An intelligence system that helps

managers assess their

competition and

vendors in order to become

more efficient and

effective competitors.


Sources of Competitive Intelligence

62

InternetInternet

Company SalespeopleCompany Salespeople

ExpertsExperts

CI ConsultantsCI Consultants

Government AgenciesGovernment Agencies

UCC FilingsUCC Filings

SuppliersSuppliers

PeriodicalsPeriodicals

Yellow PagesYellow Pages

Trade ShowsTrade Shows


Review Learning OutcomeCompetitive Intelligence

63

LO6

CI

Part of a soundmarketing strategy

Helps companiesrespond to competitivethreats

Helps reduceunnecessary costs


Documents

Chapter 9: Decision Support Systems and Marketing Research Prepared by Amit Shah, Frostburg State University Designed by Eric Brengle, B-books, Ltd. Copyright