The Marketing Research Process

Information Reduces uncertainty Helps focus decision making

“To guess is cheap, to guess wrongly is expensive” -- Chinese Proverb

Types Of Applied Research Exploratory Descriptive Causal

Uncertainty Influences The Type Of Research CAUSAL OR DESCRIPTIVE COMPLETELY CERTAIN ABSOLUTE AMBIGUITY EXPLORATORY

Degree of Problem Definition Exploratory Research Descriptive Research Causal Research (Unaware of Problem) (Aware of Problem) (Problem Clearly Defined) “Our sales are declining and “What kind of people are buying “Will buyers purchase more of we don’t know why.” our product? Who buys our our products in a new package? competitor’s product?” “Would people be interested “Which of two advertising in our new product idea?” “What features do buyers prefer campaigns is more effective?” in our product?” possible situation

Exploratory Research Initial research conducted to clarify and define the nature of a problem Does not provide conclusive evidence Subsequent research expected

Descriptive Research Describes characteristics of a population or phenomenon Some understanding of the nature of the problem

Descriptive Research Example Weight Watchers average customer Woman about 40 years old Household income of about $50,000 At least some college education Trying to juggle children and a job

Descriptive Research Example Men’s fragrance market 1/3 size of women’s fragrance market But growing at a faster pace Women buy 80 % of men’s fragrances

Causal Research Conducted to identify cause and effect relationships

Exploratory Research Techniques Secondary data (historical data) Experience Surveys - Hoops for Hunger Case Analysis Focus Groups

Descriptive Research Questionnaires Brand-switching questionnaires

Causal Experiments Test Marketing

Identifying Causality A causal relationship is impossible to prove. Evidence of causality: 1. The appropriate causal order of events 2. Concomitant variation--two phenomena vary together 3. An absence of alternative plausible explanations

What is the difference between? Research Frequency What is the difference between? Cross-Sectional Study Longitudinal Study

Stages of the Research Process Define the decision problem or opportunity Specify the research objectives Develop a research design Prepare for data collection Collect Data Analyze Data Write an present research report

Research Stages Cyclical process - conclusions generate new ideas Stages can overlap chronologically Stages are functionally interrelated Forward linkages Backward linkages

Problem Discovery And Definition First step Problem, opportunity, or monitor operations Discovery before definition Problem means management problem

“The formulation of the problem is often more essential than its solution” Albert Einstein

STAGE 1: Defining the Problem Results in Clear Cut Research Objectives Symptom Detection Exploratory Research (Optional) Analysis of the Situation Problem Definition Statement of Research Objectives

The Process of Problem Definition Understand the background of the problem. Ascertain the decision maker’s objectives. Isolate and identify the problems, not the symptoms. Determine the unit of analysis Determine the relevant variables State the research questions and objectives.

Research Objective Precise Detailed Clear Operational

Research Objective Example Problem Unsure of how to get people to come to the event. Research Objective What are the perceptions of Plover/SP/MR/WR/AD area Business/Family/Students about the HFH event on November 14, 2007? Is this objective precise, detailed, clear and operational?

The Iceberg Principle Problem Definition Obvious Symptoms Marketing Management Problems

Problem Definition Organization Symptoms Based on Symptom True Problem Twenty-year-old neighborhood swimming association in a major city. Membership has been declining for years. New water park with wave pool and water slides moved into town a few years ago. Neighborhood residents prefer the expensive water park and have negative image of swimming pool. Demographic changes: Children in this 20-year-old neighborhood have grown up. Older residents no longer swim anywhere.

Hypothesis An unproven proposition A possible solution to a problem Guess

State the research questions and research objectives Read Harley Case – page 53

BEER Beer is important to our economic stability Beer Information – Wisconsin Beer has been around for thousands of years

Why do Brewers Advertise? http://www.budweiser.com/

What is our Research Objective?

What questions should we ask?

Assignment Beer Survey Results – Case Study 2-3 Each student responsible for 5 completed surveys Due at class time – no late Case Study 2-3 Page 55