1. Copyright © Houghton Mifflin Company. All rights reserved. 6–16–1 Chapter Outline The Importance of Marketing Research The Marketing Research Process Using Technology to Improve Marketing Information Gathering and Analysis Issues in Marketing Research

2. Copyright © Houghton Mifflin Company. All rights reserved. 6–26–2 The Importance of Marketing Research Marketing Research –The systematic design, collection, interpretation, and reporting of information to help marketers solve specific marketing problems or take advantage of marketing opportunities

3. Copyright © Houghton Mifflin Company. All rights reserved. 6–36–3 The Benefits of Marketing Research Helps firms stay in touch with customers’ changing attitudes and purchase patterns Aids in the development of marketing mixes to match the needs of customers Assists in better understanding market opportunities Determine the feasibility of a particular marketing strategy Improves marketer’s ability to make decisions

4. Copyright © Houghton Mifflin Company. All rights reserved. 6–46–4 The Five Steps of the Marketing Research Process FIGURE 6.1

5. Copyright © Houghton Mifflin Company. All rights reserved. 6–56–5 Locating and Defining Problems or Research Issues Focusing on uncovering the nature and boundaries of a situation or question related to marketing strategy or implementation –Departures from normal or expected marketing results –Biases in marketing information that distort its meaning –Evidence of possible or potential market opportunities

6. Copyright © Houghton Mifflin Company. All rights reserved. 6–66–6 Designing the Research Project Research Design –An overall plan for obtaining the information needed to address a research problem or issue Hypothesis –An informed guess or assumption about a certain problem or set of circumstances –Accepted or rejected hypotheses act as conclusions for the research effort

7. Copyright © Houghton Mifflin Company. All rights reserved. 6–76–7 Types of Research Exploratory Research –Research conducted to gather more information about a problem or to make a tentative hypothesis more specific Descriptive Research –Research conducted to clarify the characteristics of certain phenomena to solve a particular problem Causal Research –Research in which it is assumed that a particular variable X influences a variable Y

8. Copyright © Houghton Mifflin Company. All rights reserved. 6–86–8 Research Reliability and Validity Reliability –A condition existing when a research technique produces almost identical results in repeated trials Validity –A condition existing when a research method measures what it is supposed to measure

9. Copyright © Houghton Mifflin Company. All rights reserved. 6–96–9 Collecting Data Types of Data –Primary data: data observed and recorded or collected directly from respondents –Secondary data: data complied both inside and outside the organization for some purpose other than the current investigation

10. Copyright © Houghton Mifflin Company. All rights reserved. 6–10 Source: “Internal Secondary Market Research,” Lycos Small Business, business.lycos.com/cch/guidebook.html?lpv=1&docNumber=P03_3020, Feb. 6, 2002 Secondary Data

11. Copyright © Houghton Mifflin Company. All rights reserved. 6–11 Source: “External Secondary Market Research,” Lycos Small Business, business.lycos.com/cch/guidebook.html?lpv=1&docNumber=P03_3011, Feb. 6, 2002. Secondary Data (cont’d)

12. Copyright © Houghton Mifflin Company. All rights reserved. 6–12 Methods of Collecting Primary Data Sampling –Population: all the elements, units, or individuals of interest to researchers for specific study –Sample: a limited number of units chosen to represent the characteristics of a total population Types of Sampling –Probability: each element has an known chance for study –Random: each element has an equal chance for study –Stratified: study population divided into like groups –Nonprobability: element’s likelihood of study is unknown –Quota: population is grouped and elements are arbitrarily chosen

13. Copyright © Houghton Mifflin Company. All rights reserved. 6–13 Survey Methods Mail Survey Telephone Survey Online Survey Personal Interview Survey –In-home (door-to-door) interview –Focus-group interview –Telephone depth interview –Shopping mall intercept interviews

14. Copyright © Houghton Mifflin Company. All rights reserved. 6–14

15. Copyright © Houghton Mifflin Company. All rights reserved. 6–15 Questionnaire Construction Open-Ended Question What is your general opinion about coffee shops?___________________________________________ Dichotomous Question Have you ever purchased a coffee product? Yes _____ No _____ Multiple-Choice Question What income group are you in? $0-$19,000 _____ $20,000-$59,999 _____ $60,000-$99,000 _____ more than $100,000 _____

16. Copyright © Houghton Mifflin Company. All rights reserved. 6–16 Observation Methods for Data Collection Direct contact with subject is avoided to reduce possible awareness of observation process. Physical conditions, subject actions, and demographics are noted. Observations may be combined with same subject interviews. Data gathered may be influenced by observer bias.

17. Copyright © Houghton Mifflin Company. All rights reserved. 6–17 Experimentation Experiment –A research method that attempts to maintain (control) certain variables while measuring the effects of experimental (uncontrolled) variables Independent variable: acts on the dependent variable Dependent variable: is affected by variations in the independent variable

18. Copyright © Houghton Mifflin Company. All rights reserved. 6–18 Interpreting Research Findings Statistical Interpretation –Analysis of survey data to determine what is typical or what deviates from the average that indicates: How widely the responses vary How the responses are distributed Which hypotheses are supported Which hypotheses are rejected Whether construction errors have invalidated the survey’s results

19. Copyright © Houghton Mifflin Company. All rights reserved. 6–19 Reporting Research Findings Take an objective look at survey findings –Report deficiencies and reasons for deficiencies Prepare a formal, written document –Summary and recommendations Short, clear, and simply expressed for executives –Technical report Contains more detailed information about research methods and procedures and important data gathered

20. Copyright © Houghton Mifflin Company. All rights reserved. 6–20 Using Technology to Improve Marketing Information Gathering and Analysis Marketing Information Systems –A framework for the management and structuring of information gathered regularly from sources inside and outside an organization

21. Copyright © Houghton Mifflin Company. All rights reserved. 6–21 Databases –A collection of information arranged for easy access and retrieval Single-Source Data –Information provided by a single marketing research firm

22. Copyright © Houghton Mifflin Company. All rights reserved. 6–22 Marketing Decision Support Systems Customized computer software that aids marketing managers in decision making –Capability to create market models based on changes in marketing variables –Artificial Intelligence (AI) assists in customer support

23. Copyright © Houghton Mifflin Company. All rights reserved. 6–23

24. Copyright © Houghton Mifflin Company. All rights reserved. 6–24 Source: Reprinted with permission of The Marketing Research Association, P.O. Box 230, Rocky Hill, CT 06067-0230, (860)257-4008.

25. Copyright © Houghton Mifflin Company. All rights reserved. 6–25 Issues in Marketing Research International Issues in Marketing Research –Modification of data-gathering methods to account for regional differences –Use of two-pronged approach to international marketing research Detailed search for and analysis of secondary data Field research to refine firm’s understanding of how local environment will shape/restrict data-gathering about customer needs and preferences

26. Copyright © Houghton Mifflin Company. All rights reserved. 6–26 Important Terms Marketing Research –The systematic design, collection, interpretation, and reporting of information to help marketers solve specific marketing problems or take advantage of marketing opportunities Research Design –An overall plan for obtaining the information needed to address a research problem or issue Hypothesis –An informed guess or assumption about a certain problem or set of circumstances

27. Copyright © Houghton Mifflin Company. All rights reserved. 6–27 Important Terms Exploratory Research –Research conducted to gather more information about a problem or to make a tentative hypothesis more specific Descriptive Research –Research conducted to clarify the characteristics of certain phenomena to solve a particular problem Causal Research –Research in which it is assumed that a particular variable X influences a variable Y

28. Copyright © Houghton Mifflin Company. All rights reserved. 6–28 Important Terms Reliability –A condition existing when a research technique produces almost identical results in repeated trials Validity –A condition existing when a research method measures what it is supposed to measure

29. Copyright © Houghton Mifflin Company. All rights reserved. 6–29 Important Terms Primary Data –Data observed and recorded or collected directly from respondents Secondary Data –Data complied both inside and outside the organization for some purpose other than the current investigation Population –All the elements, units, or individuals of interest to researchers for a specific study Sample –A limited number of units chosen to represent the characteristics of a total population

30. Copyright © Houghton Mifflin Company. All rights reserved. 6–30 Important Terms Sampling –The process of selecting representative units from a total population Probability Sampling –Sampling technique in which every element in the population being studied has a known chance of being selected for study Random Sampling –Probability sampling technique in which all units in a population have an equal change of appearing in the sample

31. Copyright © Houghton Mifflin Company. All rights reserved. 6–31 Important Terms Stratified Sampling –Probability sampling technique in which the population is divided into groups according to a common attribute and a random sample is then chosen within each group Nonprobability Sampling –Sampling technique in which there is no way to calculate the likelihood that a specific element of the population being studied will be chosen Quota Sampling –Nonprobability sampling technique in which researchers divide the population into groups and then arbitrarily choose participants from each group

32. Copyright © Houghton Mifflin Company. All rights reserved. 6–32 Important Terms Mail Survey –Research method in which respondents answer a questionnaire sent through the mail Telephone Survey –Research method in which respondents’ answers to a questionnaire are recorded by interviewers on the phone Online Survey –Research method in which respondents answer a questionnaire via e-mail or on a web site

33. Copyright © Houghton Mifflin Company. All rights reserved. 6–33 Important Terms Personal Interview Survey –Research method in which participants respond to survey questions face to face In-Home (Door-to-Door) Interview –Personal interview that takes place in the respondent’s home Focus-Group Interview –Research method involving observation of group interaction when members are exposed to an idea or concept

34. Copyright © Houghton Mifflin Company. All rights reserved. 6–34 Important Terms Telephone Depth Interview –Interview that combines the traditional focus group’s ability to probe with the confidentiality provided by telephone surveys Shopping Mall Intercept Interview –Research method that involves interviewing a percentage of persons passing by “intercept” points in a mall

35. Copyright © Houghton Mifflin Company. All rights reserved. 6–35 Important Terms Experiment –A research method that attempts to maintain (control) certain variables while measuring the effects of experimental (uncontrolled) variables Statistical Interpretation –Analysis of survey data to determine what is typical or what deviates from the average

36. Copyright © Houghton Mifflin Company. All rights reserved. 6–36 Important Terms Marketing Information Systems (MIS) –A framework for the management and structuring of information gathered regularly from sources inside and outside an organization Single-Source Data –Information provided by a single marketing research firm Marketing Decision Support Systems (MDSS) –Customized computer software that aids marketing managers in decision making

37. Copyright © Houghton Mifflin Company. All rights reserved. 6–37 Ownership of Cats and Dogs by Age Group Source: American Demographics, December 2000, p. 27. Adapted with permission. Source: Maritz Poll

38. Copyright © Houghton Mifflin Company. All rights reserved. 6–38 Top Ten Zip Codes for Spending on Fireworks Source: American Demographics, July 2000, p. 24. Adapted with permission.