P 2-1

P 2-2 Chapter 2 Marketing Research: Process and Systems for Decision Making

P 2-3 The Five P’s of the Research Process Preparation of the research report Processing of the research data Performance of the research Plan of the research Purpose of the research Figure 2-1 Irwin/McGraw-Hill Copyright © 2001 by The McGraw-Hill Companies, Inc. All rights reserved.

P 2-4 Sample Sections of a Research Plan I. Tentative projective title II. Statement of the Problem One or two sentences to outline or to describe the general problem under consideration III. Define and delimit the problem Here the writer states the purpose(s) and scope of the problem. Purpose refers to goals objectives. Closely related to this is justification. Sometimes this is a separate step, depending on the urgency of the task. Scope refers to the actual limitations of the research effort; in other words, what is not going to b investigated. Here is the point where the writer spells out the various hypotheses to be investigated or the questions to be answered. (continued) Figure 2-2 Irwin/McGraw-Hill Copyright © 2001 by The McGraw-Hill Companies, Inc. All rights reserved.

P 2-5 Sample Sections of a Research Plan IV. Outline Generally, this is a tentative framework for the entire project by topics. It should be flexible enough to accommodate unforeseen difficulties, show statistical tables in outline form, and also show graphs planned. Tables should reflect the hypotheses. V. Method and data sources The types of data to be sought (primary, secondary) are briefly identified. A brief explanation of how the necessary information or data will be gathered (e.g., surveys, experiments, library sources) is given. Sources refer to the actual depositories for the information, whether from the government publications, company records, actual people, and so forth. If measurements are involved, such as consumers’ attitudes, the techniques for making such measurements are stated. All of the techniques (statistical and nonstatistical) should be mentioned and discussed about their relevance about the task at hand. The nature of the problem will probably indicate the types of techniques to be employed, such as factor analysis, depth interviews, or focus groups. (continued) Figure 2-2 Irwin/McGraw-Hill Copyright © 2001 by The McGraw-Hill Companies, Inc. All rights reserved.

P 2-6 Sample Sections of a Research Plan VI. Sample Design This provides the limits of the universe or population to be studied and how it will be listed (or prepared). The writer specifies the population, states the sample size, whether sample stratification will be employed, and how. If a nonrandom sample is to be used, the justification and type of sampling strategy to be employed, such as convenience sample, are stated. VII. Data collection forms The forms to be employed in gathering the data should be discussed and, if possible, included in the plan. For surveys, this will involve either a questionnaire or an interview schedule. For other types of methods, the forms could include IBM cards, inventory forms, psychological tests, and so forth. The plan should state how these instruments have been or will be validated, and the reader should be given some indication of their reliability and validity. (continued) Figure 2-2 Irwin/McGraw-Hill Copyright © 2001 by The McGraw-Hill Companies, Inc. All rights reserved.

P 2-7 Sample Sections of a Research Plan VIII. Personnel requirements This provides a complete list of all personnel who will be required, indicate exact jobs, time duration, and expected rate of pay. Assignments should be made indicating each person’s responsibility and authority. IX. Phases of the study with a time schedule This is a detailed outline of the plan to complete the study. The entire study should be broken into workable pieces. Then, considering the person who will be employed in each phase, their qualifications and experience, and so forth, the time in months for the job estimated. Some jobs may overlap. This plan will help in estimating the work months required. The overall time for the project should allow for time overlaps on some jobs. (continued) Figure 2-2 Irwin/McGraw-Hill Copyright © 2001 by The McGraw-Hill Companies, Inc. All rights reserved.

P 2-8 Sample Sections of a Research Plan Illustration: 1. Preliminary investigation - two months. 2. Final test of questionnaire - one month. 3. Sample selection - one month. 4. Mail questionnaires, field follow-up, and so forth. - four months 5. Additional phases. X. Analysis plans This is a discussion of editing and proof of questionnaires, coding instructions, and the type of data analysis. An outline of some of the major tables required is useful. XI. Cost estimate for doing the study Personnel requirements are combined with time on different phases to estimate total personnel costs. Estimates on travel, materials, supplies, drafting, computer changes, and printing and mailing costs must also be included. If an overhead charge is required by the administration, it should be calculated and added to the subtotal of the above items. Figure 2-2 Irwin/McGraw-Hill Copyright © 2001 by The McGraw-Hill Companies, Inc. All rights reserved.

P 2-9 Analysis of variance (ANOVA). A statistical procedure for examining whether different samples came from populations with equal means. This`procedure is commonly used to compare the average or mean scores for different groups in experiments to determine the impact of a particular variable. Some Statistical Techniques Used in Market Research Marketing researchers use many statistical techniques to analyze data and obtain insights for strategy. In many cases, researchers are interested in investigating the impact of one or more variables (called independent variable or predictor variable). In other types of marketing research, the goals are to investigate differences between groups of consumers on various measures or to group variables or people into smaller sets. Below are brief descriptions of a number of statistical techniques used in the field. More information on these techniques can be found in the texts listed in the Additional Readings for this chapter. *********** Marketing researchers use many statistical techniques to analyze data and obtain insights for strategy. In many cases, researchers are interested in investigating the impact of one or more variables (called independent variable or predictor variable). In other types of marketing research, the goals are to investigate differences between groups of consumers on various measures or to group variables or people into smaller sets. Below are brief descriptions of a number of statistical techniques used in the field. More information on these techniques can be found in the texts listed in the Additional Readings for this chapter. *********** (continued) SOURCE: Based on definitions in Gilbert A. Churchill, Jr., Marketing Research: Methodological Foundations,, 7the ed. (Fort Worth, TX: Dryden Press, 1999); and Peter D. Bennett, ed., Dictionary of Marketing Terms,, 2nd ed. (Chicago: American Marketing Association, 1995). Figure 2-3

P 2-10 Some Statistical Techniques Used in Market Research Conjoint analysis. A statistical technique in which respondents’ valuations of attributes are inferred from the preferences they express for various combinations of these attributes. This technique is commonly used to determine the most important attributes to build into new products or to enhance existing products. *********** Cluster analysis. A body of statistical techniques concerned with developing empirical groupings of objects based on a set of measures. These techniques are used in market segmentation to form groups of similar people that could be treated as target markets. *********** Correlation analysis. A statistical technique that determines the linear relationship between two variables. Correlation's range from +1.0, for a perfect positive linear relationship, to 0.0, no linear relationship, to-1.0, a perfect negative linear relationship. Conjoint analysis. A statistical technique in which respondents’ valuations of attributes are inferred from the preferences they express for various combinations of these attributes. This technique is commonly used to determine the most important attributes to build into new products or to enhance existing products. *********** Cluster analysis. A body of statistical techniques concerned with developing empirical groupings of objects based on a set of measures. These techniques are used in market segmentation to form groups of similar people that could be treated as target markets. *********** Correlation analysis. A statistical technique that determines the linear relationship between two variables. Correlation's range from +1.0, for a perfect positive linear relationship, to 0.0, no linear relationship, to-1.0, a perfect negative linear relationship. (continued) SOURCE: Based on definitions in Gilbert A. Churchill, Jr., Marketing Research: Methodological Foundations,, 7the ed. (Fort Worth, TX: Dryden Press, 1999); and Peter D. Bennett, ed., Dictionary of Marketing Terms,, 2nd ed. (Chicago: American Marketing Association, 1995). Figure 2-3

P 2-11 Some Statistical Techniques Used in Market Research Cross tabulation. A technique that involves counting the number of cases (usually people) that fall into each of several categories when the categories are based on two or more variables considered at the same time. For example, a cross tabulation may compare the number of cars owned in different income groups to investigate the effects of income on car ownership. *********** Discriminate analysis. A statistical technique used to model the relationships between a criterion and a set of predictor variables. The criterion variable is a category (such as buyers and nonbuyers) in this procedure. *********** Factor analysis. A body of statistical techniques concerned with the study of interrelationships among a set of variables. It is commonly used to reduce a large set of variables into a smaller set of factors that can be meaningfully interpreted. (continued) SOURCE: Based on definitions in Gilbert A. Churchill, Jr., Marketing Research: Methodological Foundations,, 7the ed. (Fort Worth, TX: Dryden Press, 1999); and Peter D. Bennett, ed., Dictionary of Marketing Terms,, 2nd ed. (Chicago: American Marketing Association, 1995). Figure 2-3

P 2-12 Some Statistical Techniques Used in Market Research Multidimensional scaling. An approach in which people’s perceptions of the similarity of objects and their preferences among them are measured and`plotted into multidimensional space. *********** Regression analysis. A statistical technique used to derive an equation that relates a single criterion variable to one or more predictor variables. It is commonly used in many types of marketing research that investigate the impact of various strategic elements on such things as sales, profits, overall customer satisfaction, and purchase intentions. SOURCE: Based on definitions in Gilbert A. Churchill, Jr., Marketing Research: Methodological Foundations,, 7the ed. (Fort Worth, TX: Dryden Press, 1999); and Peter D. Bennett, ed., Dictionary of Marketing Terms,, 2nd ed. (Chicago: American Marketing Association, 1995). Figure 2-3

P 2-13 Eight Criteria for Evaluating Marketing Research Reports 1. Was the type of research appropriate for the research question? 2. Was the research well designed? a. Was the sample studied appropriate for the research questions? b. Were measures well developed, pretested, and validated? c. Were the data analysis techniques the best ones to study? 3. Was there adequate supervision of data collection, editing, and coding? 4. Was the analysis conducted according to standards accepted by the field? 5. Do the findings make sense given the research question and design, and were they considered in light of the previous knowledge and experience? 6. Are the of the study recognized and and in detail? 7. Are the conclusions appropriately drawn are they ever understated? 8. Are the recommendations for marketing strategy clear and appropriate? Figure 2-4 Irwin/McGraw-Hill Copyright © 2001 by The McGraw-Hill Companies, Inc. All rights reserved.

P 2-14 Global Information Sources for Marketing Decision Support systems Names, addresses, number of employees, products produced, and chief executive officer, up to 6 SIC classifications (4-digit) for each organization; over 144,000 business units classified by 4-digit SIC and alphabetical order Dun and Bradstreet's Principal International Business The Export Connection, a National Trade databank service of the U.S. Department of Commerce (Washington DC) Monthly series of CD-ROM disks containing data from 15 U.S. government agencies, including marketing research reports, information about specific countries and their economies, and a listing of foreign importers of U.S. products Global Market Surveys Detailed surveys for given industries such as graphics, computers, medical equipment, industrial equipment Information Source Types of Data (continued) SOURCE: Gilbert A. Churchill, Jr., and J. Paul Peter, Marketing: Creating Value for Customers, 2nd ed. (Burr Ridge, IL: Irwin/McGraw- Hill, 1998), p. 135 Figure 2-5

P 2-15 Global Information Sources for Marketing Decision Support systems (continued) Information Source Types of Data Automated Trade Locator Assistance System (district offices of the Small Business Administration) Results of current marketing research about world markets References guide to export assistance available from U.S. government The Exporters Guide to Federal Resources for Small Business (Washington DC: U.S. Government Printing Office) Overseas Business ReportsMonthly reports provide information for marketing to specific countries (e.g., Marketing in Pakistan,” “Marketing in Nigeria”) Moody’s International Manual Company histories, descriptions of business, financial statistics, management personnel SOURCE: Gilbert A. Churchill, Jr., and J. Paul Peter, Marketing: Creating Value for Customers, 2nd ed. (Burr Ridge, IL: Irwin/McGraw- Hill, 1998), p. 135 Figure 2-5

P 2-16 Global Information Sources for Marketing Decision Support systems Small Business Foundation of America export opportunity hotline: Answers to questions from small businesses interested in exporting Information Source Types of Data International trade fairs (sponsored by many industry organizations and national governments, including the U.S. Small Business Administration) Products and needs of existing and potential buyers and competitors from around the world Hotline sponsored by AT&T and seven other organizations: 800-USA-XPORT Free exporter’s kit and data on 50 industries and 78 countries SOURCE: Gilbert A. Churchill, Jr., and J. Paul Peter, Marketing: Creating Value for Customers, 2nd ed. (Burr Ridge, IL: Irwin/McGraw- Hill, 1998), p. 135 Figure 2-5