Business Research Methods
Prof Apoorv Khare
IIM Nagpur
Session 1 & 2 (select slides)
Section E, PGP term III 2024-25, IIM Nagpur
07.01.2025 & 10.01.2025
1
What is Marketing?
• Is Marketing only intuition and guesswork?
• Is there a method behind Marketing?
2
What is Marketing?
• A recap…
• Creating, communicating and delivering value to customers
• Managing customer relationships
• Individuals exchanging products and services with others for mutual
benefit
• A process of facilitating exchanges
• Marketing involves identifying and meeting human needs
3
The Marketing Concept
• Understand consumer
requirements
• Be sensitive to context and plan
• Meet requirements in a way
that meets customer needs
4
Marketing Concept: Implications
• Understand your consumer!
• Who is s/he?
• What does s/he do?
• How do I reach her?
• Understand her consumption preferences
• Product features
• Price, place etc.
5
Marketing Concept: Intricacies
• Consumer behavior
• Needs, wants and demands?
• Perceptions
• Personality
• Self
• Attitude
• Learning
6
Marketing Concept: Intricacies
• Social Processes
• Groups/ Segments
• Role of family and friends – reference groups
• Subcultural influences
• Cultural Influences
• Institutional influences; Normative forces, cultural
factors
7
• What a brand is, who “owns” the brand?
• What roles do brands play in consumers’ lives?
• How brand meaning is created, particularly as concerns the role of
marketers, consumers, and cultures acting in collaboration?
8
So, what is Marketing Research?
A more formal definition by the AMA -
The function that links the consumer, the customer,
and public to the marketer through INFORMATION
9
Marketing Research
Used to identify and
define market
opportunities and
problems
Generate, refine, and
evaluate marketing
performance
Monitor marketing
performance
Improve understanding
of marketing as a
process
10
Definition of Marketing Research
Marketing research is the systematic and objective
▪ identification
▪ collection
▪ analysis
▪ dissemination
▪ and use of information
For the purpose of improving decision making related to the
▪ identification and
▪ solution of problems and opportunities in marketing
11
Business Research Defined
• Business research is the application of the scientific method in
searching for the truth about business phenomena.
• The process includes:
• idea and theory development
• problem definition
• searching for and collecting information
• analyzing data
• communicating the findings and their implications
12
Business Research Defined
• This definition suggests that business research information is:
• not intuitive or haphazardly gathered
• accurate and objective
• relevant to all aspects of the business
• limited by one’s definition of business
• Not-for-profit organizations and governmental agencies can use
research in much the same was as managers in for-profit
organizations.
13
Applied and Basic Business Research
• Applied business research
• conducted to address a specific business decision for a specific firm or
organization.
• Example:
• Should McDonald’s add Italian pasta dinners to its menu?
• Which health insurance plan should a business provide for its employees?
14
Applied and Basic Business Research
• Basic business research (also called pure research)
• conducted without a specific decision in mind that usually does not address
the needs of a specific organization.
• Attempts to expand the limits of knowledge in general.
• Not aimed at solving a pragmatic problem.
• Example:
• Do consumers experience cognitive dissonance in low-involvement situations?
• Does employee tenure with a company influence productivity?
15
Classification of Marketing Research
Problem-Identification Research
• Identify problems not necessarily apparent on the surface
and yet exist or are likely to arise in the future.
• Examples: market potential, market share, image, market
characteristics
Problem-Solving Research
• Solve specific marketing problems.
• Examples: segmentation, product, pricing research.
• Note that these go hand in hand!
16
Classification of Marketing Research
Marketing Research
Problem Problem-Solving
Identification Research Research
Market Potential Research Segmentation Research
Market Share Research Product Research
Market Characteristics Research Pricing Research
Sales Analysis Research
Forecasting Research Promotion Research
Business Trends Research Distribution Research
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Problem-Solving Research
Determine basis of segmentation
Establish market potential and responsiveness for various segments
Select target markets and create lifestyle profiles, demography, media, and product
image characteristics
Product Research Promotional Research
Test concept Optimal promotional budget
Optimal product design Sales promotion relationship
Package tests Optimal promotional mix
Product modification Copy decisions
Brand positioning and repositioning Media decisions
Test marketing Creative advertising testing
Control store tests Claim substantiation
blank Evaluation of advertising effectiveness
Pricing Research Distribution Research
Importance of price in brand selection Type of distribution
Pricing policies Attitudes of channel members
Product line pricing Intensity of wholesale and retail coverage
Price elasticity of demand Channel margins
Response to price changes Location of retail and wholesale outlets 18
Marketing/Business Research
• Organizations deal with miscalculation, mistakes, and serendipitous
events
• Good Business Research helps organizations in the process through
which organizations experiment, adapt, and learn
19
The marketing research process Problem Definition
Development of
• Step 1: Problem definition research approach
• What is problem definition?
Research Design
• Purpose of study Formulation
• Background information available
• Information needed for decision
Data Collection
• How information will inform decision-making
Data Preparation
and Analysis
Report Preparation
and Presentation
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The Marketing Research Process Problem Definition
• Step 2: Develop an approach to the problem Development of
research approach
• Formulating an objective or theoretical
framework, analytical models, Research Research Design
questions, Hypotheses & Identify information Formulation
needed
• Discussions with management and industry Data Collection
experts
• Analysis of secondary data Data Preparation
and Analysis
• Exploratory research
• Pragmatic considerations Report Preparation
and Presentation
21
The Marketing Research Process Problem Definition
Step 3: Research Design Development of
research approach
• Framework or blueprint for the MR project.
• Details the procedure necessary for obtaining the Research Design
required information. Formulation
• Further defines the information needed
Data Collection
• Secondary data analysis
• Qualitative research, if needed
Data Preparation
• Methods for collecting quantitative data (survey, and Analysis
observation, experimentation)
Report Preparation
and Presentation
22
The marketing research process
• Research design
• Measurement and scaling procedures
• Questionnaire design
• Sampling process and sample size
• Data analysis plan
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The Marketing Research Process Problem Definition
• Step 4: Fieldwork or Data Collection Development of
research approach
• This is the sweaty part of the whole thing!
• You might have to do it yourself Research Design
Formulation
• If you are lucky…
• Field force or staff
Data Collection
• Operates in field or office
Data Preparation
and Analysis
Report Preparation
and Presentation
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The Marketing Research Process Problem Definition
Step 5 : Data Preparation and Analysis Development of
research approach
• Editing, coding, transcription and verification of
data Research Design
• Questionnaires inspected, edited/corrected Formulation
• Number or letter codes assigned to questions
• Data transcribed or keypunched, usually into a Data Collection
computer
• Data analyzed using appropriate procedures to Data Preparation
obtain information on the MR problem and input and Analysis
for decision-making
Report Preparation
and Presentation
25
The Marketing Research Process Problem Definition
Step 6: Report Preparation and Development of
Presentation research approach
• Addresses specific research questions
Research Design
• Describes the approach, research design, data Formulation
collection, data analysis procedures
• Presents results and major findings Data Collection
Data Preparation
and Analysis
Report Preparation
and Presentation
26
The marketing research process
• Report preparation and presentation
• Findings should be presented in easily comprehensible format for use of the
management
• Make oral presentation using figures, tables, graphs to enhance clarity and
impact
• Internet can be used to disseminate research findings
• Note that the research process steps are interdependent!
27
The Problem Definition Process
28
29
Factors to be Considered in the
Environmental Context of the Problem
30
Management Decision Problem vs Marketing
Research Problem
• Should a new product To determine consumer preferences
and purchase intentions for the
be introduced? proposed new product.
• Should the advertising To determine the effectiveness of the
campaign be changed? current advertising campaign
• Should the price of To determine the price elasticity of
the brand be increased demand and the impact on sales and
profits of various levels of price
changes
31
Management Decision Problem Vs. Marketing
Research Problem
Management Decision Problem Marketing Research Problem
Asks what the decision maker Asks what information is needed
needs to do and how it should be obtained
Action oriented Information oriented
Focuses on symptoms Focuses on the underlying causes
32
Tasks Involved in Problem Definition
• Discussions with Decision Makers
• Research provides information relevant to management decision, not the
solution
• Solution requires management’s judgement
• Problem audit:
• Comprehensive examination of a marketing problem with the
purpose of understanding its origin and nature
33
The Problem Audit
1. The events that led to the decision that action is needed, or the
history of the problem
2. The alternative courses of action available to the DM
• The alternatives may be incomplete at this stage, exploratory research
may be needed to identity more innovative courses of actions
3. The criteria that will be used to evaluate the alternative courses
of action
• e.g. new product offering may be evaluated on the basis of sales, mkt
share, profitability, ROI etc.
4. The potential actions that are likely to be suggested based on
the research findings
• Findings may call for strategic marketing response, sales organization
restructuring, revisiting the desired skill set of the sales persons etc..
34
The Problem Audit
• 5. The information that is needed to answer the DM's questions
• E.g. comparative details of the organization's vis-a vis competitors’
marketing mix
• 6. The manner in which the DM will use each item of information
in making the decision
• Purely information based decision, information from the research will
form a “part” of the bases of decision.
• 7. The corporate culture as it relates to decision making
• Bureaucratic, democratic/inclusive/deliberative, centralized/hierarchical
35
The departmental store project
DM: We have seen a decline in the patronage of our store.
R: How do you know that?
DM: Well, it is reflected in our sales and market share.
R: Why do you think your patronage has declined?
DM: I wish I knew!
R: What about competition?
DM: I suspect we are better than competition on some factors and worse
than them on others.
R: How do the customers view your store?
DM: I think most of them view it positively although we may have a weak
area or two.
36
Department Store Project
Problem Definition
In the department store project, the marketing research problem is to
determine the relative strengths and weaknesses of Sears, vis-à-vis other major
competitors, with respect to factors that influence store patronage.
The definition should
• Allow the researcher to obtain all the information needed to address the
management decision problem
• Guide the researcher in proceeding with the project
37
Defining the Marketing Research Problem
• Two common errors
• A too broadly defined research problem:
• Develop a marketing strategy for the brand
• Improve the competitive position of the firm
• A too narrowly defined research problem
• Decrease the price of the brand to match the competitor’s price cut
• State the marketing research problem in broad general terms and
identify its specific components → →→
38
Proper Definition of the Research Problem
39
Department Store Project
• Determine the relative strengths and weaknesses of Sears, vis-à-vis
other major competitors, with respect to factors that influence store
patronage.
• Specifically, research should provide information on the following
questions.
1. What criteria do households use when selecting department stores?
2. How do households evaluate Sears and competing stores in terms of the choice
criteria identified in question 1?
3. Which stores are patronized when shopping for specific product categories?
4. What is the market share of Sears and its competitors for specific product
categories?
5. What is the demographic and psychological profile of the customers of Sears?
Does it differ from the profile of customers of competing stores?
40
Components of an Approach
• Objective/Theoretical Foundations
• Analytical Model
• Research Questions
• Hypotheses
• Specification of the Information Needed
41
The Role of Theory in Applied Marketing
Research
Research Task Role of Theory
1. Conceptualizing and identifying key Provides a conceptual foundation and understanding of the basic processes
variables underlying the problem situation. These processes will suggest key dependent and
independent variables.
2. Operationalizing key variables Theoretical constructs (variables) can suggest independent and dependent variables
naturally occurring in the real world.
3. Selecting a research design Causal or associative relationships suggested by the theory may indicate whether a
causal or descriptive design should be adopted.
4. Selecting a sample The theoretical framework may be useful in defining the population and suggesting
variables for qualifying respondents, imposing quotas, or stratifying the population.
5. Analyzing and interpreting data The theoretical framework (and the models, research questions, and hypotheses
based on it) guide the selection of a data analysis strategy and the interpretation of
results.
6. Integrating findings The findings obtained in the research project can be interpreted in the light of
previous research and integrated with the existing body of knowledge.
42
Models
An analytical model is a set of variables and their interrelationships
designed to represent, in whole or in part, some real system or process.
In verbal models, the variables and their relationships are stated in
prose form. Such models may be mere restatements of the main tenets
of a theory.
43
Graphical Models
Graphical models are visual. They are used to isolate variables
and to suggest directions of relationships but are not designed to
provide numerical results.
Awareness
Understanding: Evaluation
Preference
Patronage
44
Mathematical Models
Mathematical models explicitly specify the relationships among
variables, usually in equation form.
n
y = a0 + å
i= 1
ai xi
Where
y = degree of preference
a0, ai = model parameters to be estimated statistically
45
Development of Research Questions and
Hypotheses
46
Research Questions and Hypotheses
• Research questions (RQs) are refined statements of the specific
components of the problem.
• A hypothesis (H) is an unproven statement or proposition about a
factor or phenomenon that is of interest to the researcher. Often, a
hypothesis is a possible answer to the research question.
47
Department Store Project
• RQ: Do the customers of Sears exhibit store loyalty?
• H: Customers of Sears are loyal.
• H2: Customers who are store-loyal are less knowledgeable about the
shopping environment.
• H3: Store-loyal customers are more risk-averse than are non-loyal
customers.
• Statistical hypotheses: operational hypotheses stated using symbolic
notations
48
Department Store Project
Specification of Information Needed
Component 1
• The researcher identified the following factors as part of the choice criteria: quality of
merchandise, variety and assortment of merchandise, returns and adjustment policy, service of
store personnel, prices, convenience of location, layout of store, credit and billing policies. The
respondents should be asked to rate the importance of each factor as it influences their store
selection.
Component 2
• The researcher identified nine department stores as competitors to Sears based on discussions
with management. The respondents should be asked to evaluate Sears and its nine competitors
on the eight choice criteria factors.
49
Department Store Project
Component 3
• 16 different product categories were selected, including women's dresses,
women's sportswear, lingerie and body fashion, junior merchandise, men's
apparel, cosmetics, jewelry, shoes, sheets and towels, furniture and
bedding, and draperies. The respondents should be asked whether they
shop at each of the 10 stores for each of the 16 product categories.
Component 4
• Information should be obtained on the standard demographic
characteristics and the psychographic characteristics of store loyalty, credit
use, appearance consciousness, and combining shopping with eating.
50
State the research problem for the following
MDPs?
• Should the in-store promotion for an existing product line be
increased?
• Determine how various levels of in-store promotion affect the sales.
• How many new sales people should be hired?
• Assess current and proposed territories with resect to their sales
potential and workload.
51
Case – Shodh Research
• Comment on Vaseem’s understanding of the client’s management
decision problem.
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