CHAPTER 3: THE MARKETING RESEARCH PROCESS

1. DECISION MAKING AND MARKETING RESEARCH

 Decision making = developing and deciding among alternatives ways of

resolving a problem
 Market opportunity = situation that makes some potential comp. advantage
possible
 Market problem = business situation that makes some significant negative
consequence more likely, because of some force acting in or on the firm’s
market
 Problems are inferred from symptoms, which serve as a signal of a problem
 Research identifies the causes of problems so decisions can shape cures and
not just treat symptoms
 Decision situations are characterised by how much certainty/ ambiguity
exists:

o Certainty

 Complete certainty means that decision-maker has all info needed to make
optimal decisions
 This includes the exact nature of marketing problem/opp
 Uncertainty means manager grasps general nature of desired objectives but
info about alternatives is incomplete
 Managers therefore recognise that spending additional time to gather data
that clarify the nature of the decision is needed

o Ambiguity:

 Nature of problem is unclear

 Objectives are vague and decision alt. are difficult to define
 Conditions of uncertainty and ambiguity makes marketing research attractive
to decision-makers

o Classifying Decision Situations

 Exhibit 3.1
 Problem-focused decision making and conditions of high ambiguity =
symptoms are not clear to point out a specific problem
 As ambiguity decreases, symptoms become clearer
 Opportunity-oriented research = ambiguity is characterised by marketplace
and env. trends that do not suggest a clear direction
 As trends become larger and clearer, they point more clearly to a single opp
2. TYPES OF MARKETING RESEARCH

 NB to match the decision situation with the right type of research to obtain
useful results

o Exploratory Research Design

 Aims to clarify ambiguous situations or discover ideas that may amount to

true business opps
 Does not provide conclusive evidence from which to determine a course of
action
 Expectation that managers need more info to supply more conclusive
evidence

 Innovation and Exploratory Research

 Useful in new prod dev

 Exploratory Research and Problem Solving

 Help better define a marketing prob/opp

 Reveal not just symptoms but potential underlying problems causing
the symptoms
o Descriptive Research

 Describes characteristics of objects, people, groups, orgs, or environments

 Addresses who, what, when, where, why, and how questions
 Helps describe market segments
 Accuracy is NB
 Conduct descriptive research with a considerable understanding of marketing
situation (unlike expl. research)

o Causal Research

 Allows decision-makers to make causal inferences

 Seeks to identify cause-and-effect relationships to show that one event
actually makes another happen
 Researchers have a substantial understanding of the decision-making
situation
 Can take a long time to implement and can be expensive

 Causality

 Three critical pieces of causal evidence:

1. Temporal Sequence = deals with time order of events

= the cause must occur before the effect

2. Concomitant Variation = when two events covary

= when a change in the cause occurs, a

change in the outcome is also observed

3. Nonspurious Association = any covariation between a cause and

an effect is because of the cause and not another variable

 Degrees of Causality

 Absolute causality = the cause is necessary and sufficient to bring

about the effect
 Conditional causality = a cause is necessary but not sufficient to bring
about an effect
  Contributory causality = weakest form, but still useful, therefore cause
is neither necessary and neither sufficient to bring about an effect

 Experiments

 Researcher manipulates proposed cause and observes any

corresponding change in the proposed effect
 Experimental variable = the proposed cause and researcher controls it
by manipulating its value
 Manipulation = researcher alters the level of the variable in specific
increments

o Uncertainty Influences the Type of Research

 Exhibit 3.4.
 ER = decision situation is highly ambiguous and man. is uncertain about what
actions to take
 DR = man. is aware of the problem but lacks key knowledge
 CR = requires tightly defined problems
 Research questions guides DR

3. STAGES IN THE RESEARCH PROCESS

 Defining research obj

 Planning a research design
 Planning a sample
 Collecting data
 Analysing data
 Formulating conclusions and preparing a report
 Exhibit 3.5
 Management input is key

o Alternatives in the Research Process

 Researcher must choose among a number of alternatives during each stage

of research process
 Exhibit 3.6 = shows decisions researchers must make in each stage

o Defining the Research Objectives

 The goals researchers intend to achieve

 Must understand decision situation = PROBLEM STATEMENT
 Discover problem through interviews and a RESEARCH PROPOSAL

 Defining the Managerial Decision Situation

 Research proposal = written statement of the research design

emphasising what the research will accomplish
 Proposal helps get man. & research team on the same page before
project begins

 Exploratory Research:

 Narrows scope of research and transforms ambiguous problem

situations into a focused project with specific objectives
 Interviews with experts, observation of consumers actually engaging
with product, analysis of online content describing the product
 Refine decision statements and research Q
 Can employ techniques from 4 categories to obtain insights and clear
idea of the problem: previous research, pilot studies, case studies,
and experience surveys

1. Previous Research

 to see if others addressed the same research problems

previously

2. Literature Review

 directed search of published works

 major challenge is to sort out most relevant

3. Pilot Studies

 small-scale research project that collects data from

respondents like they are planned in the full study
 reduce the risk that the full study design contains a fatal flaw
 fine-tuning objectives
 pretest = pilot study
 sometimes includes a focus group interview
 brings together 6-12 people in a loosely structured format
 assumes people are willing to talk about things when they are
in a group
 the feed on each other’s comments to develop ideas that
would be difficult to express in a diff interview format
  Stating Research Objectives

 After identifying problem

 States the type of research needed and what intelligence may result
that allows decision makers to make choices that are more informed
 Clarifies managerial decision into something actionable
 Written decision statement (DS) expresses business situation to
researcher
 Object. address DS directly

 What is a Theory?

 Plays a role in determining research obj

 Researchers build theory through previous findings of similar studies
 Before setting objectives, research must be able to describe the
business situation so that he/she has an idea of where to start
 Helps researcher know what variables to include and how they relate

 What is a Hypothesis?

 Formal statement explaining a specific outcome

 Researcher derives hypotheses from theory to point out what things
the research will test
 Empirical testing = comparing hypotheses against reality using data
 Exhibit 3.7 = connections between DS, RO, and RH

o Planning the Research Design

 Specifies the methods for collecting and analysing the needed info
 Each design TYPE (exploratory, descriptive, causal) provides a unique set of
options in implementing the design
 Plan of action
 Researcher must determine: sources of info, design technique, sampling
method, and schedule and cost of research

 Selection of the Basic Research Method

 Exhibit 3.6 shows 4 approaches for implementing

descriptive/causal research = SURVEYS, EXPERIMENTS,
SECONDARY DATA, OBSERVATION
 Objectives, available data sources, urgency of decision, and cost of
obtaining data influence technique selection
  Common method of primary data = SURVEY
 SURVEY = research TECHNIQUE involving interviews of sample units
in some recorded observations of some behaviour
 Objective of research projects = record things that can be observed
 Advantage = recording data about consumer behaviour without relying
on self-reports
 Survey data can provide additional info and complement intelligence
derived from observation e.g. the measurement of attitudes and
motivations
 Mystery shoppers = research companies hire people to record
observations of behaviour
 They act like customers while observing and recording data

 The ‘Best’ Research Approach

 Develops with experience

o Planning a Sample

 Procedure that draws conclusions based on measurements of a portion of the

entire population
 Identify a target population and then determine sampling units
 Larger samples are more precise, but proper probability sampling can allow a
small population of the total population to give a reliable measure of the whole
 Simple random sampling is the best method to select sampling units

o Collecting Data

 After researcher has formalised sampling plan

 Unobtrusive methods = subjects do not have to be disturbed for data to be
collected

 Editing and coding

 Convert data from fieldwork into a format that will answer marketing
manager’s questions
 Data processing and analysis stage
 Info content is mined from the raw data
 Editing = checking data collection forms for opinions, legibility, and
consistency in classification
 Editing corrects problems such as interviewer errors
 Data must be coded to become useful
o Analysing Data

 Application of computation, summarising, and reasoning to understand the

gathered info
 Determining consistent patterns and summarising relevant details revealed in
the investigation

o Drawing Conclusions

 From the data analysis

 Conclusions speak directly to the research Q and should fulfil the objectives
promised in the research proposal
 Formal report is developed and should be written in a simple manner

4. THE RESEARCH PROGRAM STRATEGY

 Research project = when researcher has only one or small number of RO that
can be addressed in a single study
 Research program = when numerous related studies come together to
address issues about a single company captured by multiple related RQ
 Program strategy = firm’s overall plan to use marketing research