CHAPTER 3: MARKETING RESEARCH

Learning Objectives:
1. The marketing information system
a. Marketing intelligence vs Marketing research
2. The marketing research process

1) Consumer Insights:
a) Good marketing decisions comes from good data
b) Consumer insights: fresh and deep understanding of customers needs and wants
c) Difficult to obtain:
i) Not obvious
ii) Customers unsure/secretive of their behavior
2) The Marketing Information System
a) The Marketing Information System (MIS): consists of people, equipment and
procedures used to:
i) Assessing the information needs
ii) Developing needed information
iii) Helping decision makers use the information for customer insights
iv)

b) Assessing the information needs:

i) A good MIS balances the information managers would like to have against what
they really need and what is feasible to acquire and monitor
ii) The system begins by interviewing managers to find out what information they
would like
c) Marketing Intelligence:
i) Is a routine ongoing activity of information collecting to enrich understanding of
the marketplace
ii) Improve strategic decision making by:
(1) Understanding the consumer environment
(2) Assessing and tracking competitor actions
(3) Providing early warnings of opportunities and threats

3) Marketing Research:
a) Overview:
i) Is the systematic design, collection, analysis, and reporting of data relevant to a
specific marketing situation facing an organization
ii) Typically conducted to answer questions stemming from issues uncovered by
marketing intelligence information
iii) Marketing research links the consumer, customer and public to the marketer
through information
iv) It is used to:
(1) Identify and define marketing opportunities and problems
(2) Generate, refine and evaluate marketing actions
(3) Monitor market performance
(4) Improve understanding of the marketing process
b) Steps in a Marketing Research project:
i) Step 1: Defining the marketing problem
ii) Step 2: Developing the research plan
iii) Step 3: Collecting secondary data
iv) Step 4: Collecting primary data
v) Step 5: Analyzing the data
vi) Step 6: Reporting the findings
c) Step 1: Defining the problem and the research objective
i) The marketing manager and the researcher must work closely to define the
problem carefully and agree on the research objective
ii) The manager understands best what information is needed, while the researcher
understands marketing research and how best to obtain the information
iii) Problem Definition:

(1)
(2) Is the most difficult step in the research process
(3) Symptom: is marketing phenomenon (usually identifiable and measurable)
(4) Marketing problem: is the cause of the symptom (usually a correctable 4P
issue)
(5) Market research problem: identifies type of information needed to solve the
marketing problem
 (6)
iv) Once the problem has been defined, the manager and researcher must set the
research objective
(1) There are 3 types of objectives: Exploratory, Descriptive and Causal
(2) Exploratory research: the objective is to gather preliminary information that
will help define the problem and suggest hypotheses
(3) Descriptive research: describing things such as market potential for a product
(4) Causal research: testing hypotheses about cause-and-effect relationships
v) Exploratory Research: “What’s out there?”
(1) Focus is on the discovery of ideas
(2) Most commonly used for further defining company issues
(3) The research you do when you don’t know what questions you should be
asking
(4) Does not intend to offer final and conclusive solutions to existing problems
(5) This research is mostly open ended (e.g. “What are young kids into these
days?”, “Why are people not buying from us anymore?”, “What are
consumers thinking about when they hear our brand name?”)
vi) Descriptive Research:
(1) Describe, count, or “map” characteristics of a population or phenomenon
being studied
(2) Surveying of demographical traits in a certain group
(3) It does not answer questions about how/when/why the characteristics occur
(4) Organizations often use it as a method to reveal and measure something
(5) Descriptive research is primarily about measuring things (e.g. “What is the
potential market size we can expect if we open a hipster café around
Glenferrie?”, “How many people will like the taste of green tea Fried
Chicken?”)
vii) Causal Research:
(1) Testing hypothesis or prediction
(2) Looks at the effect of one thing or variable on another
(3) Tries to establish what causes a certain phenomena – Does X cause Y?
(4) Causal Research is about confirming cause and effects (usually through
comparisons) (e.g. “Which celebrity should we use to boost our sales?”, “How
much will sales change if I reduce price by 10%?”, “What will be the change
 in people’s reaction?”, “What will be the change in people’s reaction to service
failure if I play loud music instead of classical music in my restaurant?”)
viii) Exploratory vs Descriptive vs Causal:
(1) “Why are people not buying from us?” – is best answered via exploratory –
open ended questioning
(2) “Which consumer segments have we lost since last year?” – is best answered
via descriptive measurements
(3) “how much discount should I offer to get customer back?” – is best answered
via experimental research
d) Step 2: Developing the research plan:
i) The research plan outlines the following:

(1)
e) Step 3 + 4: Sources of Data - primary and secondary data
i) Gathering secondary data: information that already exists somewhere, having been
collected for another purpose

(1)
ii) Primary Data: consist of information gathered for a specific research plan
 (1)
(2) Primary data collection:

(a)
(b) Observational research: involves gathering primary data by observing
relevant people, actions, and situations
(c) Ethnographic research: involves sending trained observers to watch and
interact with consumers in their “natural environments”.
(d) Survey research: is the gathering of primary data by asking people
questions about their knowledge, attitudes, preferences and buying
behavior
(e) Experimental research: involves gathering primary data by selecting
matched groups of subjects, giving them different treatments, controlling
related factors, and checking for differences in group responses
f) Step 5 + 6: Implementing the Research Plan (Analyzing the data + Reporting the
findings)
i) After designing the research and data collection, the researcher needs to put the
marketing plan into action
(1) Collecting, processing and analyzing the information
(2) The researcher then uses statistics program to summarize the results and to
understand what might predict the outcomes of interest
ii) Interpreting and reporting the findings:
(1) The researcher must now interpret the findings and draw conclusions and
report them to the management
(2) The researcher should present major findings that are useful for the main
decisions faced by management