Conducting Mrktng Research

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The Marketing Research Process

Chapter 29Conducting Market ResearchChapter 29Conducting Market Research

Section 29.1 The Marketing Research Process

Section 29.2 The Marketing Survey

Section 29.1 The Marketing Research Process

Section 29.2 The Marketing Survey


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Objectives

y Explain the steps in designing and conducting

marketing research

y Compare primary and secondary data

y Collect and interpret marketing information

y Identify the elements in a marketing researchreport

Key Terms

problemdefinition

primary data

secondary

datasurvey method

sample

observationmethod

point-of-saleresearch

experimentalmethod

data analysis

Marketing Essentials Chapter 29, Section 29.1


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Study Organizer

Construct a flow chart like this one to record thesteps in conducting marketing research.



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The five steps that a business follows whenconducting marketing research are:

Defining the problem

Obtaining data

Analyzing the data

Recommending solutions

Applying the results



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Step 1: Defining the Problem

Problem definition ; occurs when a business clearly

identifies a problem and what is needed to solve it.

Because money and time are limited, businessesmust identify which problems and issues are themost important to address at a given time.

problemdefinition

The process bywhich a businessclearly identifies

a problem andwhat is neededto solve it.



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Step 2: Obtaining Data

The word data means facts. There are two types ofdata used in marketing research:

Primary data ; are facts obtained for the firsttime and used specifically for the particularproblem or issue under study.

Secondary data ; have already been collected forsome purpose other than the current study. They

are less expensive to collect than primary data.

There are many ways secondary data can beobtained from both internal sources (within thecompany) and external sources.

primary data

Data obtained forthe first time andused specificallyfor the particular

problem or issueunder study.

secondarydata

Data that hasalready been

collected forsome purposeother than thecurrent study.



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How Secondary Data Are Obtained

Secondary data are most often collected in thefollowing ways:

The Internet

U.S. and state government sources

Specialized research companies

Business publications and trade organizations



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The Internet provides company Web sites that shareproduct descriptions, services offered, locations,

revenue information, and company specifications.

Digital dossiers provide company profiles on publiccorporations, income statements, and balance sheets.These are also online.



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Data collected by U.S. government agencies can alsobe accessed for free or for a minimal cost on the

Internet. These data deal with:

Population demographics

Specific markets

Industries

Products Economic news

Export information

Legislative trends



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Specialized companies will sell:

Demographic data Five-year forecasts

Consumer purchase information

Business data

Census information

Consumer classification reports

Syndicated services make this information availablein print and electronic formats.



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National and statewide trade associations oftenpublish secondary data in articles, reports, and books.

The greatest advantage of secondary data is thatthey can be obtained easily because of how widelydistributed they are.

There are two major disadvantages to secondarydata:

The existing data may not be suitable for theproblem under study.

The data may sometimes be outdated and/orinaccurate.



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How Primary Data Are Obtained

Primary research data can be collected using threemethods:

The survey method

The observation method

The experimental method

The survey method ; is a research technique in

which information is gathered from people throughthe use of surveys or questionnaires. It is the mostfrequently used method of collecting primary data.

A sample ; is a part of the target population that

represents it accurately.

surveymethod

A researchtechnique inwhich

information isgathered frompeople throughthe use ofsurveys orquestionnaires.

sampleA part of thetarget populationthat is assumedto represent theentirepopulation.



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Survey research can be conducted in person, byphone, by mail, or by using the Internet. When the

marketer has decided how to conduct the survey, heor she then writes the questions according to thespecific needs of that survey type.

Personal interviews can be done in focus groups,door-to-door, or randomly in central locations.



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A focus group interview involves eight to twelvepeople who are brought together to evaluate

advertising, a product, design, or marketing strategyunder a skilled moderator.



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A major advantage of personal interviews is that theyget a much better and easier response than mail,

phone, or Internet surveys.

Telephone interviews are quick, efficient, andrelatively inexpensive.



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While mailed surveys have low response rates asuccessful survey may get a ten percent response

offering some type of incentive to complete them canhelp to convince more people to respond.



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Internet-based surveys are quick and eliminate theneed for data entry. A drawback is that Internet

surveys are limited to individuals who have access tothe Web. Also, many people dislike receivinguninvited e-mail surveys.



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The observation method ; is a research technique

in which the actions of people are watched and

recorded either by cameras or by observers.

A mystery shopper is a researcher who poses as acustomer. The mystery shopper observes theinteractions between customers and salespeople toevaluate the effectiveness of sales staff.

observationmethod

A researchtechnique inwhich the actions

of people arewatched andrecorded eitherby cameras or byobservers.



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One disadvantage of the observation method is thatit cannot measure attitudes or motivation. Two

advantages of the observation method are that it isfaster than personal interviews, and people areunaware that they are being observed, so they act asthey normally would.



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Point-of-sale research ; involves observing

shoppers to decide which ones to choose as research

subjects. After observation, researchers approach theselected shoppers and ask them questions.

This method provides fresh and accurate informationfrom the consumer because the purchase has justbeen made.

point-of-saleresearch

A form ofresearch thatcombines natural

observation withpersonalinterviews to getpeople to explainbuying behavior.



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The experimental method ; is a technique in which

a researcher observes the results of changing one or

more marketing variables while keeping othersconstant under controlled conditions. It is not usedfrequently because of the cost of setting up theresearch conditions and the inaccuracy of theresponses.

experimentalmethod

A researchtechnique inwhich a

researcherobserves theresults ofchanging one ormore marketingvariables whilekeeping certain

other variablesconstant undercontrolledconditions.



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Step 3: Analyzing the Data

Data analysis ; is the process of compiling,

analyzing, and interpreting the results of primary and

secondary data collection.

Data mining is a computer process that usesstatistical methods to extract new information fromlarge amounts of data.

data analysis

The process ofcompiling,analyzing, andinterpreting the

results ofprimary andsecondary datacollection.



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Step 4: Recommending Solutions tothe Problem

Solution recommendations must be clear and well-supported by the research data. A typical research

report includes the following:

Title page

Acknowledgments of people who assisted

Table of contents

List of tables, figures, charts, and graphs



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Step 4: Recommending Solutions tothe Problem

Introduction

Review of the research information

Procedures used

Findings

Recommendations

Summary and conclusions Appendixes

Bibliography



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Step 5: Applying the Results

Managers use the research report to make decisionsabout marketing strategies to address the researched

problem or issue.

After the research is completed and changes aremade, a business should carefully monitor the resultsto know if the actions are successful.



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SECTION 29.1 REVIEW


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SECTION 29.1 REVIEW

- click twice to continue -


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The Marketing Survey

Objectives

y Design a marketing research survey

y Administer a marketing research survey

Key Terms

validity

reliability

open-endedquestions

forced-choicequestions



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The Marketing Survey

Study Organizer

Complete an outline of this section by listingheadlines, subheadings, and key concepts.



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A questionnaire has validity ; when the questions

asked measure what was intended to be measured.

Reliability ; exists when a research techniqueproduces nearly identical results in repeated trials.It requires that the questions ask for the sametype of information from all respondents.

To be valid and reliable, a questionnaire must be

properly:

Written

Formatted

Administered

validity

When questionsasked on aquestionnairemeasure what

was intended tobe asked.

reliability

When a researchtechniqueproduces nearlyidentical resultsin repeated trials.

Constructing the Questionnaire



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Open-ended questions ; ask respondents to

construct their own response to a question.

Forced-choice questions ; ask respondents tochoose answers from possibilities on aquestionnaire.

Yes/No questions should be used only when askingfor a response on one issue, for example, Was

our facility well maintained? Having a questionthat asks about more than one issue decreasesvalidity and reliability.

open-endedquestionsQuestions thatrequirerespondents to

construct theirown answers.

forced-choicequestionsQuestions thatask respondentsto choose

answers frompossibilities givenon aquestionnaire.

Writing Questions



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Multiple-choice questions give the respondentseveral choices. When constructing these, it is

important to make the options mutually exclusiveand comprehensive enough to include everypossible response.

Offering the choice of other increases reliability.

Writing Questions



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Other forced-choice questions may askrespondents to rate a product or service based

upon a scale.

Level of agreement questions make statementsand ask respondents for their level of agreement.Commonly used options include strongly agree,agree, neutral, disagree, and strongly disagree.


Writing Questions


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Each question should be clearly written and asbrief as possible.

Use consistent ranking scales for all similarquestions.

Avoid leading questions and introducing biases.

Do not use questions that make yourrespondent guess.

B

asic Guidelines for WritingQuestions



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You should use dark ink on light paper and typethat is easy to read. The questionnaire should be

short enough that the respondent does not growfrustrated or tired while answering.

Be sure to put section headings or numbers on allindividual survey sections as well as numbers foreach question.

Formatting



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Page numbers are essential tomake sure your respondent does

not get lost within the survey.

Formatting



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General demographic questions about gender, age,ethnicity, and education are typically grouped

together at the end of the survey. That is becauserespondents are more likely to answer personalquestions after completing the other questions.

Formatting



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A plan must be established for selectingparticipants in an unbiased way. Be sure to explain

the surveys purpose either in person or on thequestionnaire.

Many questionnaires offer incentives to encouragepeople to participate.

Administering the Questionnaire



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SECTION 29.2 REVIEW


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SECTION 29.2 REVIEW



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Section 29.1

y The five steps that a business follows whenconducting marketing research are defining theproblem, obtaining data, analyzing the data,recommending solutions, and applying the results.The steps are performed sequentially to arrive atsolutions to a problem or research an issue.

continued


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Section 29.2

y Questionnaires should provide data that are validand reliable. Marketing surveys may include open-ended and forced-choice questions. Forced-choicequestions include yes/no, multiple-choice, ratingscale, and level of agreement questions.

y To obtain unbiased data and increase response

rates, market researchers must follow guidelineswhen constructing, formatting, and administeringsurveys.

continued


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This chapter has helped prepare you to meet thefollowing DECA performance indicators:

Identify information monitored for marketingdecision making

Describe sources of secondary data

Search the Internet for marketing information

Monitor internal records for marketing information

Collect marketing information from others (e.g.,customers, staff, vendors)


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CHAPTER 29 REVIEW


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CHAPTER 29 REVIEW


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Conducting Mrktng Research