4 Conducting Marketing Research 1

Chapter Questions  What constitutes good marketing research?  What are the best metrics for measuring marketing productivity?  How can marketers assess their return on investment of marketing expenditures? Copyright © 2012 Pearson Education 4-2

Venus Razor Copyright © 2012 Pearson Education 4-3

What is Marketing Research? Marketing research is the systematic design, collection, analysis, and reporting of data and findings relevant to a specific marketing situation facing the company. Copyright © 2012 Pearson Education 4-4

Copyright © 2012 Pearson Education 4-5 Types of Marketing Research Firms Syndicated Custom Specialty-line

Copyright © 2012 Pearson Education 4-6 The Marketing Research Process  Define the problem  Develop research plan  Collect information  Analyze information  Present findings  Make decision

Copyright © 2012 Pearson Education 4-7 Step 1: Define the Problem  Define the problem  Specify decision alternatives  State research objectives

Types of Research Copyright © 2012 Pearson Education 4-8 Exploratory Descriptive Causal

Copyright © 2012 Pearson Education 4-9 Step 2: Develop the Research Plan  Data sources  Research approach  Research instruments  Sampling plan  Contact methods

Data sources Copyright © 2012 Pearson Education 4-10

Copyright © 2012 Pearson Education 4-11 Research Approaches  Observational and ethnographic  Focus group  Survey  Behavioral  Experimental

Focus Groups Copyright © 2012 Pearson Education 4-12

Copyright © 2012 Pearson Education 4-13 Research Instruments  Questionnaires  Qualitative Measures  Technological Devices

Qualitative Techniques Copyright © 2012 Pearson Education 4-14 Word Associations Visualization Projective Techniques Laddering

Questionnaire Do’s and Don’ts  Ensure questions are free of bias  Make questions simple  Make questions specific  Avoid jargon  Avoid sophisticated words  Avoid ambiguous words  Avoid negatives  Avoid hypotheticals  Avoid words that could be misheard  Use response bands  Use mutually exclusive categories  Allow for “other” in fixed response questions Copyright © 2012 Pearson Education 4-15

Copyright © 2012 Pearson Education 4-16 Question Types - Dichotomous In arranging this trip, did you contact American Airlines?  Yes  No

Question Types – Multiple Choice Copyright © 2012 Pearson Education 4-17 With whom are you traveling on this trip?  No one  Spouse  Spouse and children  Children only  Business associates/friends/relatives  An organized tour group

Question Types – Likert Scale Copyright © 2012 Pearson Education 4-18 Indicate your level of agreement with the following statement: Small airlines generally give better service than large ones.  Strongly disagree  Disagree  Neither agree nor disagree  Agree  Strongly agree

Question Types – Semantic Differential Copyright © 2012 Pearson Education 4-19 American Airlines Large ………………………………...…….Small Experienced………………….….Inexperienced Modern……………………….…..Old-fashioned

Question Types – Importance Scale Copyright © 2012 Pearson Education 4-20 Airline food service is _____ to me.  Extremely important  Very important  Somewhat important  Not very important  Not at all important

Question Types – Rating Scale Copyright © 2012 Pearson Education 4-21 American Airlines’ food service is _____.  Excellent  Very good  Good  Fair  Poor

Question Types – Intention to Buy Scale Copyright © 2012 Pearson Education 4-22 How likely are you to purchase tickets on American Airlines if in-flight Internet access were available?  Definitely buy  Probably buy  Not sure  Probably not buy  Definitely not buy

Question Types – Intention to Buy Scale Copyright © 2012 Pearson Education 4-23 How likely are you to purchase tickets on American Airlines if in-flight Internet access were available?  Definitely buy  Probably buy  Not sure  Probably not buy  Definitely not buy

Question Types – Completely Unstructured Copyright © 2012 Pearson Education 4-24 What is your opinion of American Airlines?

Question Types – Word Association Copyright © 2012 Pearson Education 4-25 What is the first word that comes to your mind when you hear the following? Airline ________________________ American _____________________ Travel ________________________

Question Types – Sentence Completion Copyright © 2012 Pearson Education 4-26 When I choose an airline, the most important consideration in my decision is: _____________________________________ _____________________________________ _____________________________________ _____________________________________ _____________________________________ _____________________________________ __________________.

Question Types – Story Completion Copyright © 2012 Pearson Education 4-27 “I flew American a few days ago. I noticed that the exterior and interior of the plane had very bright colors. This aroused in me the following thoughts and feelings.” Now complete the story. ___________________________________ ___________________________________ ___________________________________ ___________________________________ ___________________________________

Technological Devices  Galvanometers  Tachistoscope  Eye cameras  Audiometers  GPS Copyright © 2012 Pearson Education 4-28

Sampling Plan  Sampling unit: Who is to be surveyed?  Sample size: How many people should be surveyed?  Sampling procedure: How should the respondents be chosen? Copyright © 2012 Pearson Education 4-29

Contact Methods Copyright © 2012 Pearson Education 4-30

Pros and Cons of Online Research Advantages  Inexpensive  Fast  Accuracy of data  Versatility Disadvantages  Small samples  Skewed samples  Technological problems  Inconsistencies Copyright © 2012 Pearson Education 4-31

What is a Marketing Decision Support System (MDSS)?  A marketing decision support system is a coordinated collection of data, systems, tools, and techniques with supporting hardware and software by which an organization gathers and interprets relevant information from business and environment and turns it into a basis for marketing action. Copyright © 2012 Pearson Education 4-32

Barriers Limiting the Use of Marketing Research  A narrow conception of the research  Uneven caliber of researchers  Poor framing of the problem  Late and occasionally erroneous findings  Personality and presentational differences Copyright © 2012 Pearson Education 4-33

Market Research Can Fail Copyright © 2012 Pearson Education 4-34

Copyright © 2012 Pearson Education 4-35 Table 4.3 Characteristics of Good Marketing Research  Scientific method  Research creativity  Multiple methods  Interdependence  Value and cost of information  Healthy skepticism  Ethical marketing

Copyright © 2012 Pearson Education 4-36 What are Marketing Metrics? Marketing metrics are the set of measures that helps marketers quantify, compare, and interpret marketing performance.

Copyright © 2012 Pearson Education 4-37 Table 4.4 Marketing Metrics External  Awareness  Market share  Relative price  Number of complaints  Customer satisfaction  Distribution  Total number of customers  Loyalty Internal  Awareness of goals  Commitment to goals  Active support  Resource adequacy  Staffing levels  Desire to learn  Willingness to change  Freedom to fail  Autonomy

Copyright © 2012 Pearson Education 4-38 What is Marketing-Mix Modeling? Marketing-mix models analyze data from a variety of sources, such as retailer scanner data, company shipment data, pricing, media, and promotion spending data, to understand more precisely the effects of specific marketing activities.

Figure 4.2 Marketing Measurement Pathway Copyright © 2012 Pearson Education 4-39

Figure 4.3 Marketing Dashboard Copyright © 2012 Pearson Education 4-40

Copyright © 2012 Pearson Education 4-41 Table 4.4 Sample Customer-Performance Scorecard Measures  % of new customers to average #  % of lost customers to average #  % of win-back customers to average #  % of customers in various levels of satisfaction  % of customers who would repurchase  % of target market members with brand recall  % of customers who say brand is most preferred

For Review  What constitutes good marketing research?  What are the best metrics for measuring marketing productivity?  How can marketers assess their return on investment of marketing expenditures? Copyright © 2012 Pearson Education 4-42

43 All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher. Printed in the United States of America. Copyright © 2012 Pearson Education Copyright © 2012 Pearson Education