Business Research Methodology

Chapter 1
Introduction to Business Research
Chapter Outline
1) Overview
2) Definition of Business Research
3) A Classification of Business Research
4) Business Research Process
5) Research Service Suppliers
6) Selecting a Research Supplier
The world of airplanes
The world of airplanes

Company Market Share

Airbus (France) 45%
Boeing (USA) 43%
Bombardier Aerospace (Canada) 5%
COMAC (China) 4%
Irkut Corporation (Russia) 3%
Real Research
Boeing: Taking Flight
Boeing Commercial Airplanes (BCA) division develops and sell airplanes
in the commercial segment.
-premier Manufacturer of commercial jetliners for more than 40 years.
-Provide products & services to customers in 145 countries
-Headquarter in Chicago
-Boeing has 13,000 commercial jetliners in service worldwide
 Boeing: Taking Flight
In the airplanes Manufacturing industry there is few players, but
the competition is intense.
The BCA understand it is important to continuously monitor the
dynamic marketplace and understand the needs & priorities of
BCA customers (airlines) and their customers (people who fly).
To achieve this, CBA employ market research on a regular basis.
 Boeing: Taking Flight

✓Boeing entrusted Harris Interactive Inc.

✓Harris Interactive Inc. is one of the largest research firms in the

world and is based on NY.

✓Boeing commissioned a study to determine the aircraft

preference of fliers.
 The Study
• The study was survey based on 913 interviews conducted in
the USA, UK, Tokyo and Hong Kong.
• International travelers aged between 18 to 65 who had taken
at least one recent eight-hour or longer flight.
• Interviews were conducted between Nov. 2003 & Feb. 2004.
• Respondents were first screened and qualified by telephone
or in-person.
• Then completed an online survey at home or work.
 Results
- More than 60% prefer a single-deck airplane than double-deck.
- 7 out of 10 travelers prefer a double meal serve over inflight
entertainment
- 42% are concerned about in-flight communication with attendants
- 83% prefer specious leg-room
- Travelers in all the classes of service from all four regions believe
smaller airplanes will provide a better experience with check-in,
boarding, disembarking, baggage claim, and customs or immigration
than the 550-seat aircraft.
“What we found was that travelers taking very long flights generally prefer the more
convenient and flexible experience provided by small planes” - Dr. David Bakken.
 Decisions

Stop the production of double-decker planes!!

What is Business Research?
Business research is the application of scientific methods in
searching for the truth about business phenomena. These
activities include defining business opportunities and
problems, generating and evaluating alternative courses of
action, and monitoring employee and organizational
performance.
 What is Business Research?
A more thorough definition for this course:
Business research is the systematic and objective
▪ identification
▪ collection
▪ analysis
▪ dissemination
▪ and use of information

For the purpose of improving decision making related to the

▪ identification and solution of problems
▪ and grabbing the opportunities & avoiding/minimizing the threats in business
Classification of Business Research
Problem-Identification Research
Research undertaken to help identify problems which are not
necessarily apparent on the surface and yet exist or are likely to
arise in the future.
• Example: market potential, market share, brand or company image, sales analysis,
forecasting, and business trends research.
Problem-Solving Research
• Research undertaken to help solve specific business or market
problems. Once a problem or opportunity has been identified,
problem-solving research is undertaken to arrive at a solution.
• Example: segmentation, product, pricing, distribution research etc. (for details:
table 1.1)
 A Classification of Business Research
Business Research

Problem Problem-Solving
Identification Research Research

• Market Potential Research • Segmentation Research

• Market Share Research • Product Research
• Market Characteristics Research • Pricing Research
• Forecasting Research • Promotion Research
• Business Trends Research • Distribution Research
Problem-Solving Research

SEGMENTATION RESEARCH
1. Determine the basis of customer
segmentation
• Through demographics, media
preferences, product preferences, etc. PRODUCT RESEARCH
2. Establish market potential for various 1. Test product concept
segments
2. Package tests
3. Select target markets
3. Product testing and modification
• E.g. high-end, tech-savvy, suburban
customers aged 35-55. 4. Brand positioning and repositioning
5. Test marketing
Problem-Solving Research
PROMOTIONAL RESEARCH

0.00%
▪ Choosing the optimal promotional budget
APR
and mix

▪ Media decisions

▪ Creative advertising testing

▪ Evaluation of advertising effectiveness

PRICING RESEARCH
▪ Pricing policies
▪ Branding through pricing $ALE
▪ Product line pricing
Problem-Solving Research
DISTRIBUTION RESEARCH

Determine the…
▪ Proper types of distribution
▪ Intensity of wholesale & resale coverage
▪ Ideal location(s) of retail and wholesale
outlets
Business Research Process
Step 1: Defining the Problem

Step 2: Developing an Approach to the Problem

Step 3: Formulating a Research Design

(Data desired, measurement decision, survey design, sampling decisions)

Step 4: Doing Field Work or Collecting Data

Step 5: Preparing and Analyzing Data

Step 6: Preparing and Presenting the Report

Step 1: Problem Definition

In defining the problem, the researcher should take into account:

• the purpose of the study,
• the relevant background information,
• the information needed,
• and how it will be used in decision making.

Problem definition involves:

• discussion with the decision makers,
• interviews with industry experts,
• analysis of secondary data,
• and, perhaps, some qualitative research, such as focus groups.
Step 2: Development of an Approach to the Problem

It includes
• formulating an objective or theoretical framework,
• analytical models,
• research questions, and hypotheses
• and identifying the information needed
Step 3: Research Design Formulation

A research design is a framework or blueprint for conducting the marketing

research project.

It involves the following steps:

1. Definition of the information needed
2. Secondary data analysis
3. Qualitative research
4. Methods of collecting quantitative data (survey, observation, and
experimentation)
5. Measurement and scaling procedures
6. Questionnaire design
7. Sampling process and sample size
8. Plan of data analysis
Step 4: Fieldwork or Data Collection

Data collection involves a field force or staff that operates

either in the field (personal interviewing) or electronically (e-
mail or Internet: survey monkey, google doc etc.).

Proper selection, training, supervision, and evaluation of the

field force help minimize data-collection errors.
Step 5: Data Preparation and Analysis

Data preparation includes the editing, coding, transcription, and verification

of data.
• Number or letter codes are assigned to represent each response to
each question in the questionnaire.

• The data from the questionnaires are inserted directly into the
computer.

• The data are analyzed to derive information related to the

components of the business or marketing research problem and,
thus, to provide input into the management decision problem.
Step 6: Report Preparation and Presentation

The entire project should be documented in a written report that addresses

the specific research questions identified.

The report should describes the following issues:

1. Research problem in hand
2. Research approach
3. Research design
4. Data collection method
5. Data analysis procedures and tools adopted
6. The major findings
7. Recommendation for the management
Business Research Suppliers & Services

• Internal suppliers
• External suppliers
• Full-service suppliers
• Syndicated services
• Standardized services
• Customized services
• Internet services
• Limited-service suppliers
• Field services
• Focus groups and qualitative services
• Technical and analytical services
• Other services
Business Research Suppliers & Services
• An internal supplier is an R&D department within the firm. Many
firms, particularly the big ones, ranging from automobile companies
(GM, Ford, Chrysler) to consumer products firms (Procter & Gamble,
Colgate Palmolive, Coca-Cola) to banks (JPMorgan Chase, Bank of
America), maintain in-house marketing research departments.
• External suppliers are outside firms hired to supply business &
marketing research data.
Business Research Suppliers & Services
• Full service suppliers offer the entire range of research services, from
problem definition, approach development, questionnaire design,
sampling, data collection, data analysis, and interpretation, to report
preparation and presentation.
• Limited-service suppliers specialize in one or a few phases of the
research project, such as only field survey or data collection, focus
group, technical or data analytics etc.
Criteria for Selecting a Research Supplier
▪ What is the reputation of the supplier?
▪ Do they complete projects on schedule?
▪ Are they known for maintaining ethical standards?
▪ Are they flexible?
▪ Are their research projects of high quality?
▪ What kind and how much experience does the supplier have?
▪ Do the supplier's personnel have both technical and non-technical expertise?
▪ Can they communicate well with the client?

Competitive bids should be compared on the basis of quality as well as price.

Class Discussion: Why 7 Eleven failed in Indonesia?
https://www.youtube.com/watch?v=tfGUJowHOPM
Thank You!!