1. Conducting Marketing Research and Forecasting Demand
Prepared for:
Universitas Ciputra
Conducting Marketing Research and Forecasting Demand
Chapter 4 Phillip Kotler & Kevin Lane Keller

2. Marketing Research
is a systematic design collection, analysis and reporting of data and finding relevant to a specific marketing situation facing the company

3. Suppliers of Marketing Research
Engaging Students or Professors to design and carry out projects
Using the internet
Checking out rivals
Research Firms:
Syndicated-service research firms
Custom marketing research firms
Specialty-line marketing research firms
Syndicated- service research firm: research company gathers consumer and trade information which it sells for a fee; eg. Ac nielsen
Custom marketing research firm: research company provides research subject to customer’s order
Specialty-line marketing research firm: specialize in specific market/industry; eg. Service firm, FMCG firm, etc

4. Marketing Research Process
1. Define the Problem & Research Objectives
2. Develop the Research Plan
3. Collect the Information
4. Analyze the Information
5. Present the Findings
6. Make the Decision

5. 1. Define the Problem & Research Objectives
Neither too broad nor too narrow
Three types of Objectives:
Exploratory Research
Descriptive Research
Causal Research
Exploratory research: find out the real nature of the problem and suggest possible solution or new ideas
Descriptive research: seek quantify demand, such as how many certain customer would purchase certain product
Causal research: to test cause and effect relationship

6. 2. Develop Research Plan [1]
Data Sources
Primary Data
Secondary Data
Research Approaches
Observation
Focus Group
Survey
Behavioral Data
Experiment
Research Instrument
Questionnaire
Technological Devices
Qualitative Measure:
Word association
Visualization
Brand personification

7. 2. Develop Research Plan [2]
Sampling Plan
Sampling Unit
Sampling Size
Sampling procedure
Sampling Procedure
Probability Sample
Simple Random Sample
Stratified Random Sample
Cluster Sample
Non Probability Sample
Convenience Sample
Judgment Sample
Quota Sample
Contact Method
Mail
Telephone
Personal
Arranged
Intercept
Online
Click stream
Cookies

8. 3. Collect the info The need to achieve consistency
Cross-cultural research; the need to use different approaches
Bias

9. The next processes 4. Analyze the Info 5. Present Findings
Test different hypotheses & theories
Applying sensitivity analysis
5. Present Findings
Relevant to the need
6. Make the Decision

10. Overcoming the Barriers to the Use of Marketing Research
A narrow conception of the research
Uneven caliber of the researcher
Poor framing of the problem
Late and occasionally erroneous findings
Personality and presentational difference

11. The Seven Characteristics of Good Marketing Research
Scientific method
Research creativity
Multiple methods
Interdependence of model and data
Value and cost information
Healthy skepticism
Ethical Marketing

12. Measuring Marketing Productivity
Marketing Metric
Measuring Marketing Plan Performance
Profitability Analysis
Marketing Mix Modeling

13. Marketing Metric
The set of measures that help firm to quantify, compare and interpret their marketing performance (asses marketing effect)
Short-term result;
eg. profit & loss, sales turnover, etc.
Changes brand equity;
eg. customer awareness, attitude, behavior, marketing share, etc.

14. Sample of Marketing Metric
External
Internal
Awareness of goal
Commitment to goal
Active innovation support
Resources adequacy
Staffing/skill level
Desire to learn
Willingness to change
Freedom to fail
Autonomy
Relative employee satisfaction
Awareness
Market share (volume or value)
Relative price (volume or value)
Number of complaints (level of dissatisfaction)
Customer satisfaction
Distribution/availability
Total number of customers
Perceived quality/esteem
Loyalty/retention
Relative/perceived quality

15. Measuring Marketing Plan Performance
Sales variance analysis
Relative contribution of different factors to a gap in sales performance
Microsales analysis
Look at specific products, territories and expected sales
Sales Analysis
Overall market share
Served market share
Relative market share
Market Share Analysis
Marketing Expenses to Sales Analysis
Financial Analysis

16. Profitability Analysis
Identifying functional expenses
Assigning functional expenses to marketing entity
Preparing a profit and loss statement for each marketing entity
Marketing Profitability Analysis
Determining Corrective Action
Direct cost
Traceable common cost
Non-traceable common cost
Direct versus Full Costing

17. Forecasting & Demand Measurement
Measures Market Demand
Vocabulary for Demand Measurement
Estimating Current Demand
Estimating Future Demand

18. The Measures of Market Demand
World; National; Regional; Territory; Customer
Space Level
All Sales; Industry Sales; Company Sales; Product-line Sales; Product-form Sales; Product item Sales
Product Level
Short run; Medium run; Long run
Time Level

19. Which Market to Measure?
Market: Actual Buyer + Potential
Potential Market: Interest
Available Market: Interest, Income, Access
Target Market (served = target market)
Penetrated Market (who are buying the company’s product)

20. A Vocabulary for Demand Measurement
Market Demand
Marker Share (Market Penetration Index-Share Penetration Index)
Market Forecast (Product Penetration Percentage)
Market Potential
Company Demand
Company Sales Forecast (sales quota, sales budget)
Company Sales Potentials

21. Estimating Current Demand
Total Market Potential
Area Market Potential
Industry Sales and Market Shares
TMP = max amount of sales that might be available to all the firms in an industry during a given period, under a given level of industry marketing effort and environmental conditions.
Area market potential: a company will allocate different marketing budget in different territories since the market potential in each area is different
Industry sales and market share: it is important for a company to know its share in a specific industry/market, etc. Eg. If the overall industry’s market demand increases by 10% but the company’s demand increases 5%, it means the company loose its market.

22. Estimating Future Demand
Three stages Procedure:
Macroeconomic Forecast
eg. inflation, interest rate, unemployment, etc
Industry Forecast
Company Sales Forecast

23. Survey of Buyer’s Intentions
Forecasting: the art of anticipating what buyers are likely to do under a given set of condition
Composite of sales force opinion
Expert opinion (Group Discussion Method; Pooling of Individual Estimates)
Past Sales Analysis (Time-Series Analysis; Exponential Smoothing; Statistical Demand Analysis; Econometric Analysis)
Market Test Method