Marketing Research
N6
Module 1: The nature and scope of marketing
research
MISSION AND AIMS OF A MARKETING RESEARCH ENTERPRISE
The mission and goals of any organization must be clearly formulated. The
organisation should have insight into what they want to achieve. This will
enable the management team to make decisions based on the mission and
goals of the organisation. A mission statement is a written declaration of the
organisation, which expresses the will and objective of that organisation.
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Module 1: The nature and scope of marketing research (continued)
MARKETING RESEARCH AND DECISION MAKING
Marketing managers make numerous strategic and tactical decisions in the
process of identifying and satisfying customer needs. Decision makers in
marketing make decisions about potential opportunities, target markets,
market segmentation and the implementation of marketing programmes. This
process is complicated by controllable variables such as product, price,
promotion and place.
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Module 1: The nature and scope of marketing research (continued)
DEFINITION OF MARKETING RESEARCH
Marketing research is the systematic and objective identification, collection,
analysis and dissemination of information for assisting management in
decision making related to the identification and solution of problems and
opportunities in marketing.
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Module 1: The nature and scope of marketing research (continued)
APPLICATION OF MARKETING RESEARCH IN DIFFERENT AREAS
The application of marketing research can be through:
Problem identification or Problem solving research is
opportunities are undertaken to undertaken to arrive at a solution.
help identify problems which may The findings of problem solving
not be visible on the surface but research are used in making
are there and will most likely arise decisions, which will solve specific
in the future. marketing problems.
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Module 1: The nature and scope of marketing research (continued)
THE ROLE OF MARKETING RESEARCH IN THE MARKETING CONCEPT
The role of marketing research is:
• To conduct studies to determine what consumers want before any
decisions regarding marketing strategies are taken.
• To supply the marketing manager with the necessary information.
• To determine how the client’s needs can be ultimately satisfied.
• To analyse the collected information and find previously unnoticed
opportunities or problem areas.
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Module 1: The nature and scope of marketing research (continued)
THE RELATIONSHIP BETWEEN MARKETING RESEARCH AND THE
PRODUCT LIFE CYCLE
In each phase of the product lifecycle, there are opportunities and problems.
The different phases include:
• Introduction phase;
• Growth phase;
• Matured phase; and
• Declining phase.
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Module 1: The nature and scope of marketing research (continued)
THE RELATIONSHIP BETWEEN MARKETING RESEARCH AND MIS/DSS
Marketing Information System (MIS) is a formalised set of procedures that is
always generating, analysing, storing and distributing information to
marketing decision makers. Decision Support System (DSS) is an integrated
system that includes hardware, communication networks and database
software. The system continuously collects and interprets information for
decision makers.
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Module 1: The nature and scope of marketing research (continued)
THE FUNCTION OF MARKETING RESEARCH IN A BUSINESS
Marketing research can be
conducted inside the business, if it
has its own research department or
an outside firm can also be
appointed to perform this function
for the firm.
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Module 1: The nature and scope of marketing research (continued)
ADVANTAGES AND DISADVANTAGES OF MARKETING RESEARCH
Advantages Disadvantages
Guides managers towards the correct decision. Bias - the research project might be influenced by the
researcher’s philosophy.
It removes uncertainty by providing correct removes uncertainty by providing correct information about
information about the marketing research the marketing research environment.
environment.
It identifies possible problems or opportunities. Time frame – it might take a long time for managers to get
the results of a research project.
It enhances effective decision-making. Exact science – marketing research is not an exact science.
It contributes to the formulation of appropriate
policies.
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Module 1: The nature and scope of marketing research (continued)
WHEN SHOULD A FIRM UNDERTAKE A MARKETING RESEARCH
PROJECT?
• When information on the topic is not available.
• To formulate effective marketing policies.
• When there is a problem with the marketing programme.
• When decision makers have to evaluate two options.
• To collect information about the best strategy for a product’s lifecycle.
• When management would like to know why a programme was effective.
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Module 2: The marketing research process
STEPS IN THE RESEARCH PROCESS
Step 1: Define the marketing research problem.
Step 2: Preliminary investigation.
Step 3: Hypothesis development.
Step 4: Expansion of the information schedule.
Step 5: Identify and choose sources of data.
Step 6: Data collection and sample design.
Step 7: Data preparation and analysis.
Step 8: Report.
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Module 2: The marketing research process (continued)
RESEARCH DESIGN
A research design is a framework or blueprint for conducting the marketing
research project. It details the procedures necessary for obtaining the
information needed to structure or solve the marketing research problem. A
good research design will ensure that the marketing research project is
conducted effectively and efficiently.
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Module 3: Source of information
SECONDARY DATA
Secondary data refers to information which is already available. It is found in
internal sources such as sales invoices, previous marketing research
records, annual reports, letters of complaint, credit reports, and stock sheets.
External sources include guides, directories, indexes, statistical data,
census, and publications.
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Module 3: Source of information (continued)
PRIMARY DATA
Primary data refers to information which is originated by the researcher for
the specific purpose of addressing the problem at hand. Primary data are
applicable to two types of research: qualitative and quantitative research.
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Module 3: Source of information (continued)
POTENTIAL SOURCES OF ERROR IN RESEARCH DESIGNS
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Module 4: The questionnaire design
OBJECTIVES/FUNCTIONS OF A QUESTIONNAIRE
A questionnaire is a formalised set of questions for obtaining information
from respondents. A questionnaire must translate the information needed into
a set of specific questions that the respondents will answer. It must inspire,
motivate and encourage the respondent to become involved in the interview,
cooperate with the interviewer and complete the interview. It must also
minimise response error.
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Module 4: The questionnaire design (continued)
STEPS IN DESIGNING A QUESTIONNAIRE
Step 1 – Determine the information needed.
Step 2 – Determine the method of data collection.
Step 3 – Determine the content of the individual questions.
Step 4 – Determine the types of questions that will be used.
Step 5 – Decide on the wording of the questions.
Step 6 – Determine the order in which questions must be asked.
Step 7 – Decide on the layout and reproduction of the questionnaire.
Step 8 – Pre-test the questionnaire.
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Module 4: The questionnaire design (continued)
GUIDELINES TO INCREASE RESPONDENTS’ CO-OPERATION IN
ANSWERING A QUESTIONNAIRE
• Put sensitive topics at the end of the questionnaire.
• Questions which refer to general behaviour or is common knowledge can
be prefaced with a statement.
• Ask the question in the third person.
• Hide the difficult or embarrassing questions in a group. Go through the
entire list of questions quickly.
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Module 4: The questionnaire design (continued)
GENERAL HINTS WHEN DESIGNING A QUESTIONNAIRE
• Indicate the different questions contained in the questionnaire.
• The formulation of these questions depend on the instructions of a test
paper, assignment or examination.
• Mention the name of the organisation conducting the research, the
address, and introduction explaining the questionnaire.
• Conclude the questionnaire with a statement thanking the respondent.
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Module 4: The questionnaire design (continued)
FIELDWORK
Researchers have two important options when collecting data:
• They can organise the fieldwork themselves or
• They can contract with a fieldwork agency.
It is important that the researcher plan the fieldwork constructively.
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Module 5: The sampling process
CONCEPTS DEFINITION
Sampling is one of the components of the research design. The following
concepts are important in order to understand sampling:
Population: The aggregate of elements that share common characteristics.
Element: The object about which or from which the information is desired.
Census: Involves a complete analysis of the elements of a population.
Sample: A sub-group of the population selected for participation in the study.
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Module 5: The sampling process (continued)
CLASSIFICATION OF SAMPLING METHODS
Sampling methods are classified as non-probability sampling and probability
sampling.
• Non-probability sampling relies on the personal judgement of the
researcher rather than chance in the selection of sample elements.
• Probability sampling techniques vary in terms of sampling efficiency.
Sampling efficiency is a concept, which reflects a trade-off between
sampling cost and precision.
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Module 5: The sampling process (continued)
A SAMPLE VERSUS A CENSUS
Different circumstances will determine whether a sample or a census must
be used. However, in most cases a sample is usually better to use because:
• A census has large budget. • Sampling errors.
• Time available. • Attention to individual cases.
• Size of population. • Secrecy.
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Module 5: The sampling process (continued)
ADVANTAGES AND DISADVANTAGES OF A SAMPLE
Method Advantages Disadvantages
Convenience Least expensive, least time consuming, most Selection bias. Sample not representative
convenient. Not recommended for descriptive or casual
research.
Judgemental Low cost, convenient, not time consuming. Does not allow generalisation, subjective.
Quota Sample can be controlled for certain Selection bias, no assurance of
characteristics. representation.
Snowball Can estimate rare characteristics. Time consuming.
Simple random Easily understood. Results projectable. Difficult to construct sampling frame.
Expensive. Lower precision. No assurance of
representation.
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Module 5: The sampling process (continued)
ADVANTAGES AND DISADVANTAGES OF A SAMPLE (CONT.)
Method Advantages Disadvantages
Systematic Can increase representation, easier to Can decrease representation .
implement with simple random sampling,
sampling frame not necessary.
Stratified Includes all important sub-populations. Very Difficult to select relevant stratification
precise. variables. Not feasible to stratify on many
Variables. Expensive.
Cluster Easy to implement. Cost effective. Imprecise. Difficult to compute and interpret
results.
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Module 5: The sampling process (continued)
STEPS IN SAMPLING DESIGN
Step 1 – Define the population.
Step 2 – Determine the sampling frame.
Step 3 – Select a sampling method.
Step 4 – Determine the sample size.
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Module 5: The sampling process (continued)
PRINCIPLES FOR SELECTING A SAMPLE IN MARKETING RESEARCH
• The sample must relate to the problem definition.
• It must also be representative for whom the study is conducted.
• A sample tested under conditions must produce the same results.
• The sample value must be accurate.
• Sampling errors must be limited as far as possible.
• The sampling frame must be applicable to the target population.
• The sampling size must reflect a proper ratio in relation to the population.
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Module 6: Analysis of data
DATA PREPARATION
Data preparation should begin as soon as the first batch of questionnaires is
received from the field or while the fieldwork is still in progress. Problems that
are detected at this stage can be addressed and the fieldwork modified to
incorporate any adjustments.
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Module 6: Analysis of data (continued)
DATA ANALYSIS
Data analysis happens after data preparation has been done. Tabulation is a
process of analysing data preparation and putting the data into different
categories according to the variables.
Two different tabulation methods include:
• Single tabulation and
• Cross tabulation.
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Module 6: Analysis of data (continued)
CONFIDENCE INTERVALS
The confidence interval is the range into which the true population parameter
will fall assuming a given level of confidence. The confidence interval in data
processing specifies the level of precision. This is the maximum permissible
difference between the sample mean and the population mean. It specifies
the level of confidence and determines the standard deviation of the
population.
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Module 6: Analysis of data (continued)
MEASURES OF VARIABILITY
Range: Measures the spread of the data.
Variance: The mean squared deviation from the mean.
Standard deviation: The square root of the variance.
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Module 6: Analysis of data (continued)
BASIC MEASUREMENT SCALES
Measurement means assigning numbers or other symbols to characteristics
of objects according to certain pre-specified rules. In marketing research, not
the consumers, but their perceptions, attitudes, preferences or other relevant
characteristics are measured. Scales of measurement include:
• Nominal scale; • Interval scale; and
• Ordinal scale; • Ratio scale.
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Module 6: Analysis of data (continued)
CRITERIA FOR A GOOD MEASURING SCALE
The findings of your results in a survey depend on how well it was measured.
The instrument that you use should have the following characteristics:
• Reliability;
• Validity; and
• Generalisability.
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Module 6: Analysis of data (continued)
OBJECTIVES FOR A GOOD MEASURING SCALE
• Reliability;
• Validity;
• Sensitivity;
• Relevance;
• Versatile; and
• Ease of response from respondents,
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Module 7: Requisition analysis and forecasting
REQUISITION ANALYSIS OR DEMAND ANALYSIS
Because demand for services and products vary, businesses must have a
thorough knowledge of the market. Information about the market can be
obtained through:
• Sales analysis; • By looking at the effect of change
• Marketing segmentation; in the marketing mix; and
• Marketing potential; • By observing your competitors.
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Module 7: Requisition analysis and forecasting (continued)
FORECASTING
Market forecasting are the methods and techniques management uses to
collect information to assess the markets’ probable development. Distinguish
between three levels of forecasting:
General economic forecasting;
Industrial forecasting; and
Company forecasting.
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Module 7: Requisition analysis and forecasting (continued)
THE CHOICE FOR A FORECASTING METHOD
The choice of a method depends on:
• The time span (long term or short term).
• The frequency of use (how often do you need to make a forecast).
• The type of product.
• The data available.
• The accuracy required.
• The stability of the market environment.
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Module 8: Reporting
ROLE OF THE REPORT IN MARKETING RESEARCH
The report is the tangible product of the research effort. The report serves as
a historical record of the marketing research project. Management decisions
are guided by the report. Management’s decisions to do marketing research
in the future or to use the particular research suppliers again, will be
influenced by the perceived usefulness of the report and its presentation.
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Module 8: Reporting (continued)
GUIDELINES FOR WRITING A REPORT
A report should be written for a specific reader or readers. The report must
be logically structured and clearly written. The report must be reproduced
professionally – edited and proofread, printed on quality paper and properly
bound. Objectivity should guide the report writing. It is important to reinforce
key information in the text with tables, graphs, pictures and other visual
devices.
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Module 8: Reporting (continued)
THE REPORT FORMAT
There are different formats in which research reports can be prepared, but
most include:
• The title page; summary; • Limitations and
• Letter of transmittal; • Introduction; shortcomings; and
• Letter of authorisation; • The methodology; • Conclusions and
• Table of contents; • Interpretation and recommendations.
• Management conclusions;
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Module 8: Reporting (continued)
TYPES OF REPORTS
The following types of reports can be used to express ideas in writing:
• Progress report.
• Basic report.
• Publications.
• Technical reports.
• Management reports.
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