Chapter 4 Market Research

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					      Chapter 4: Market Research

• Knowledge is Power
   Accurate, up-to-date, relevant information is the fuel
    that runs the marketing engine
• Marketing Information System
   Determines what information marketing managers
     • then gathers, sorts, analyzes, stores, and distributes
       information to system users

Figure 4.2: The Marketing Information
                  4 Types of Data

• Internal Company Data
   Know some examples
   Intranet (define)
• Marketing Intelligence
   Know some examples
   Information about trends in the external environment
      • Futurists/scenarios
                                  Look-Look employs an army of
     • Competitive intelligence   “coolhunters” to report on the
        – Industrial espionage            latest trends

       4 Types of Data (Continued)

• Marketing Research
   Collect, analyze, and interpret data about customers,
    competitors, and the business environment to
    improve marketing effectiveness
   Syndicated research
   Custom research
• Acquired Databases
   Purchase other companies’ data (say, customer list)
   Government databases
   Misuse of customer data is an issue
 Customer Relationship Management:
           Data Mining
• Data mining:
  Includes sophisticated analysis techniques to take
  advantage of the massive amount of transaction
  information now available
• Analysts sift through data to identify unique patterns of
  behavior among different customer groups for use in
  behavioral targeting
    Create categories of customers based on purchase history and other
• Behavioral Targeting

• Uses of data mining
      Customer acquisition
      Customer retention and loyalty
      Customer abandonment
      Market basket analysis
        • Cross-sell/up-sell
Figure 4.4: Steps in the Research
      Define the Problem

      Determine Research Design
        Choose Data Collection Method

                   Design the Sample

                         Collect the Data

                        Analyze and Interpret Data

                         Prepare the Research Report
 Burke Research Video
           Steps in the Marketing
             Research Process

• Step 1: Define the research problem
   Specifying research objectives
   Identifying consumer population of interest
   Placing the problem in an environmental context

Step 2: Determine the Research Design

  Specifying exactly what information marketers will
   collect and what type of study they will do
  Determine whether secondary data are available
    • Secondary data: Have been collected for some purposes
      other than the problem at hand
  Determine whether primary data are required and if so,
   what type:
    • Primary data: Information collected directly from respondents
      to specifically address the question at hand
        – Exploratory research
        – Descriptive research
        – Causal research
  See next slide: Primary vs. Secondary data/research
        Figure 4.5:
Marketing Research Design

   Exploratory (Qualitative) Research

• Exploratory research techniques generate
  insights for future, more rigorous studies
   Typically involve in-depth consumer probing

• Take many forms: Types of Exploratory
     One-on-one interviews with consumers
     Focus group:
     Projective techniques:
     Case study
     Ethnography

    Descriptive (Quantitative) Research

•   Probes systematically into the problem
•   Hypothesis testing
•   Bases conclusions on large sample size
•   Results typically expressed in quantitative
    terms (averages, percentages, other stats)
     Cross-sectional design: one point in time
     Longitudinal design: over time

                 Causal Research

• Cause-and-effect relationships: a change
  in one thing causes a change in something
   Independent (cause) vs. dependent (change in
    outcome) variables
   Experiments: test predicted relationships among
    variables in a controlled environment
     • Lab or field study

   Step 3: Choose the Method for
      Collecting Primary Data
 Survey Methods: (don’t worry about survey methods)
 Observational methods: data collection where the
  researcher records consumers’ behaviors, often
  without their knowledge
   • Personal observation
   • Mechanical observation
   • Unobtrusive measures
 Online Research (next slide)

      Online Research Applications

• Web metrics: track consumers while they
  are surfing
• Cookies allow a Web sponsor to track a
  surfer’s moves
• Surveys:
   New product development
   Estimating market response
   Exploratory research (online focus groups)
   IM (Instant Messaging)
                                   Communities of customers;
                                   harness power of online
                 Steps 4, 5, 6, and 7

• Step 4: Design the Sample
   Don’t worry about sampling techniques (MKTG 366)
• Step 5: Collect the Data
   Challenges to gathering data in foreign countries
• Step 6: Analyze and Interpret the Data
• Step 7: Prepare the Research Report

      Ethics in Marketing Research

• Marketing research ethics:
  Taking an ethical and above-board
  approach to conducting marketing research
  that does no harm to the participant in the
  process of conducting the research
   Researchers must provide full disclosure of
    confidentiality and anonymity options
   SUGGING* is unethical and against AMA code of
             Two other topics:

• Neuromarketing
• Prediction markets, p. 105