Chapter-2 Defining the Marketing Research Problem and Developing an Approach Dr. Tamgid Ahmed Chowdhury

1) Overview 2) Importance of Defining a Problem 3) The Process of Defining a Problem and Developing an Approach Developing an Approach 4) Tasks involved in Problem Definition 5) Environmental Context of the Problem 6) Management Decision Problem and Marketing Research Problem 7) Defining the Marketing Research Problem 8) Components of an Approach 8) Components of an Approach 9) International Marketing Research 9) International Marketing Research Chapter Outline

Importance of defining the problem Problem definition: A broad statement of the general problem and identification of the specific components of the marketing research problem. Example: Your friend said over phone that his company’s sales has gone down by 10% in 2011 and 15% by He wants to explore the reason(s). A general probable problem statement: Sales is declining due to poor marketing efforts. Is that really true? If yes, what are the specific reasons? If no, what may be the other reasons? Finding specific answers to these questions will give us a definition of the problem.

The Problem Definition Process Discussion with Decision Maker(s) Interviews with Experts Secondary Data Analysis Qualitative Research Management Decision Problem Marketing Research Problem Symptom(s) Environmental Context of the Problem Step I: Problem Definition Step II: Approach to the Problem Objective/ Theoretical Foundations Research Questions Hypotheses Step III: Research Design Analytical Model: Verbal, Graphical, Mathematical Characteristics/ Factors Influencing Research Design

 Problem audit: A comprehensive examination of a marketing problem to understand its origin. Case of SMC, Bangladesh: Why consumers of the remotest corner of the country could not get SMC products? Decision maker said: They wanted to revamp the distribution system. Question: Would that really work?

 Communication: Free exchange of ideas  Cooperation: Team work with DM  Confidence: Work with mutual trust  Candor: Open agendas and ideas  Closeness: Help anytime  Continuity: Continuous interactions  Creativity: Finding solutions in new and better way

 Experience survey: Interview with the most knowledgeable people of the industry. Also known as key-informant technique Case: Tajrin Garments: Before getting a final report, investigators talked to engineers, planners and fire brigade officers.  Lead user survey: Interviews with the lead users (For example, asking the frequent buyers about the product)

 Data collected from other reasons and not for the problem in hands. Case: Can microcredit disbursement make a sea-change in poverty reduction rate? Secondary data: Microcredit disbursement (NGOAB, 2010) by NGOs had increased by $ million between 1991/92 and 1995/96 while rural poverty increased from 52.9% to 56.7%. On the other hand, between 1995/96 and 2000, microcredit disbursement decreased by $ million, but at that time the rural poverty situation had improved with poverty reducing from 56.7% to 53.1%. One possible answer: Thus more credit disbursement will reduce more poverty may not be really true.

 An unstructured, exploratory research method based on small samples intended to provide insights and understanding of the problem. 1. Pilot study: Administering an unstructured questionnaire in a small sample. It contains more open-ended questionnaires 2. Case studies: Intensive examination of few selected cases with similar types of problem

PAST INFORMATION AND FORECASTS RESOURCES AND CONSTRAINTS OBJECTIVES BUYER BEHAVIOR LEGAL ENVIROMENT ECONOMIC ENVIROMENT MARKETING AND TECHNOLOGICAL SKILLS Environmental Context of the Problem

 Past information and forecast: More working couple family structure has created a market for packet spices (Radhuni) and frozen foods  Resources and constraints: Budget for the research and manpower availability  Objectives: Goals of the organization and of the decision makers needs to be considered.  Buyer behavior: Predicting consumer’s reaction on recommendations.  Legal environment: Government laws, pressure group opinion etc. should be considered  Economic environment: Income, price savings etc.  Marketing and technological skills.

DM: People living in the remotest corner do not get SMC products R: How do you know that? DM: Our donors found that and reported to us R: What may be the possible reasons for that? Did donors say anything? DM: NO, donors said nothing and they wish to know why? We feel we need to revamp the distribution channel. R: Why do you think that it is the reason? DM: Our own experts say so. R: Do the customers said so? DM: No idea about consumer’s perceptions.

 Management’s decision problem: What to do to revamp the distribution system?  Marketing research problem: Explore the strengths and weaknesses of the existing distribution channel. Investigate the responses of the customers and other stakeholders.

MGT decision problemMarketing research problem Should a new product be introduced Should the advertising campaign be changed Should we change the price of the brand Determine the consumer preferences and purchase intention towards the proposed product Determine the effectiveness of the current advertising campaign Calculate price elasticity of demand and investigate customer’s perception towards pricing of other competing brands.

PROPER DEFINITION OF THE RESEARCH PROBLEM  Broad statement: initial statement of the problem that provides an appropriate perspective. Such as: What may be the appropriate distribution channel for SMC, Bangladesh to reach to the remotest part.  Specific components: 1) Is existing system really bad? What the stakeholders say about that? 2) How many intermediaries should they use? 3) What type of commission is required for that? 4) will that have an impact on total reach and total cost structures?

 Broad definition: Comparing relative effectiveness of microcredit-driven GO and NGO projects in Bangladesh.  Specific definitions: 1) Comparing effectiveness with respect to service delivery mechanism 2) Comparison with respect to their contribution in uplifting the living standard of the poor.

The Problem Definition Process Discussion with Decision Maker(s) Interviews with Experts Secondary Data Analysis Qualitative Research Management Decision Problem Marketing Research Problem Tasks Involved Environmental Context of the Problem Step I: Problem Definition Step II: Approach to the Problem Objective/ Theoretical Foundations Research Questions Hypotheses Step III: Research Design Analytical Model: Verbal, Graphical, Mathematical Characteristics/ Factors Influencing Research Design

 Objective or theoretical framework: Unbiased evidence is required that is supported by empirical findings. For example, literatures suggest a common myth of NGO domination over GO in effectiveness comparison. However, that is not universally acceptable.  Analytical model: A set of variables and their interrelationships designed to represent some real system. Such as, a function.  Graphical models: Analytical model that provides visual pictures of the relationships.  Mathematical model: Relationship is shown in mathematical format. Such as, regression equations

 Research question: These are refined statements. What the determinants of effectiveness measurement? Or Between GO and NGO, who is more effective in delivering services to the poor? Who is more effective in enhancing living standard of the poor?  Hypothesis: Statement that is testable. Such as, H 0 : GO and NGO projects are equally effective in delivering services to the poor. H A : they are differences in service delivery effectiveness between GO and NGOs.

 Your company (class mates are the BOG members) is unsure whether they should do corporate alliance with GP or Banglalink.  Marketing research problem: Broad: Compare the relative performance of GP and B.link. Specific-1: Investigate the strengths and weaknesses of GP and B.link based on the opinion of the users. Specific-2: Explore the offers of GP and B.link for corporate clients. Specific-3: Cost comparison between GP and BL.  Objective: Literature suggests that GP has unparallel network but Blink has fast growing customer base, more service points. There are confusion about the pricing of GP and Blink.

 Research questions: What are the determinants of performance evaluation between GP and Blink? If you want to chose a broad and available criteria, who is performing better on those issues?  Hypothesis: H 0 : There is no difference in performance between GP and Blink with respect to network coverage, connection cost, features, roaming facilities, call cost, SMS cost, social responsibilities, corporate relationship maintaining, image in the market, after sales customer service etc. H A : There are differences between GP and Blink on the stated issues. Approach: Mathematical model or simple descriptive research. Put weight on every item or equal weight to all.