8/30/21

Consumer Analysis

PGDM 2021-23
Marketing Management
Prof. Suresh Ramanathan

Marketing Research Techniques

Descriptive Research

Survey research Naturalistic research

(self-report measures) (behavioral measures)

Interviews Questionnaires Observation Case studies

1
 8/30/21

Interviews

n Interviewing style
n Unstructured: interviewer talks freely with interviewee about many
topics
n Structured: uses fixed-format items
n Interviewing method
n Telephone
n numbers generated automatically; questions read from
computer
n is standardized, efficient, and coordinated
n In-person
n advantages: close rapport can develop; may increase
motivation to continue & be honest
n disadvantages: are expensive and time-consuming to
conduct
n Focus groups: interviewing multiple people at a time (can lead to
valuable insights)

LADDERING
n Description
n laddering is an individual interviewing technique that starts out from important concrete
attributes and tries to identify deeper, more abstract benefits that consumers are looking
for
n Method
n first select important concrete attributes
n ask directly
n Kelley Repertory Grid
n Preference method
n then dig for deeper benefits by asking "why is that important to you?"
n this creates a "ladder" or hierarchy of goals
n be flexible and responsive
n use creatively (e.g., upside-down, branch out)
n Pros & Cons

2
 8/30/21

LADDERING INTERVIEW
n R: You said that a shoe’s lacing pattern is important to you in deciding what brand to buy. Why is
it?
n C: A staggered lacing pattern makes the shoe fit more snugly on my foot
n R: Why is it important that the shoe fit more snugly on your foot?
n C: Because it gives me better support.
n R: Why is better support important to you?
n C: So I can run without worrying about injuring my foot.
n R: Why is it important for you to not worry while running?
n C: So I can relax and enjoy the run.
n R: Why is it important that you can relax and enjoy the run?
n C: Because it gets rid of tension I have built up at work.
n R: Why is it important for you to get rid of tension from work?
n C: Because when I go back to work in the afternoon, I can perform better.
n R: Why is it important that you perform better?
n C: I feel better about myself.
n R: Why is it important that you feel better about yourself?
n C: It just is!

Laddering: Express Mail Delivery

Self-Esteem Peace of Mind

VALUES
Personal Accomplishment Personal Control

More Productive Competitive Earn More Less Worry

Advantage Money about Unknowns
PSYCHOSOCIAL Not Responsible for
CONSEQUENCES Others’ Errors
Saves Time & Get Promoted
Effort Real-Time Record Makes Me
FUNCTIONAL Of Package Handling Look Good
CONSEQUENCES Convenient On-time Delivery
Package
ATTRIBUTES Drop Box Tracking Software Reliable

3
 8/30/21

Example of Focus Groups:

Pringles Potato Chips

The Case of Pringles:

P&G’s Potato Chip Story

n P&G developed product to overcome

existing retailer complaints (wanted chips
that wouldn’t break in transit or spoil
quickly).
n Pringles judged as good as competition in
blind taste test.
n Achieved 25% share due to high trial.
n But…repeat purchase very low.
n Why?

4
 8/30/21

Post-Launch Diagnosis

n P&G conducted focus groups to study the

consumer psychology driving the purchasing
behavior
n Consumers said that Pringles seemed artificial for a
potato chip
n They inferred artificial taste from physical
characteristics:
n Uniform shape and texture
n Not burnt or greasy
n Sold in cans and not broken

Focus groups led to insights about

segmentation strategy

n Original target segment was families and upper-middle

class adults. Rationale?
n They might have biggest problem with chips being broken
n They would like re-sealable can (less messy, lasts longer)
n They would be willing to pay higher price for these features
n Realized that adults weren’t open to non-traditional
chips (and disliked artificiality), but teens liked them
because they were different (and different = cool)
n Changed target segment to teens
n Addressed teen’s concerns: lowered price and added
new flavors
n Changed advertising campaign to appeal to youth
(commercial)
n Now, Pringles has found its niche and is very successful

10

5
 8/30/21

Questionnaires

nSet of fixed-format items that is

completed by respondents at their
own pace
nAdvantages: cheaper, most honest
responses, less experimenter bias
nDisadvantages: response rate may be
low

11

Questionnaire Do’s and Don’ts

• Ensure questions are free of • Avoid negatives

bias
• Make questions simple
• Make questions specific
• Avoid jargon
• Avoid sophisticated words
• Avoid ambiguous words
1-12
• Avoid hypotheticals
• Avoid words that could be
misheard
• Use response bands
• Use mutually exclusive
categories
• Allow for “other” in fixed
response questions

12

6
 8/30/21

Question Types - Dichotomous

In arranging this trip, did you contact Indigo directly?

£ Yes £ No

13

Question Types – Multiple Choice

With whom are you traveling on this trip?

£ No one
£ Spouse
£ Spouse and children
£ Children only
£ Business associates/friends/relatives
£ An organized tour group

14

7
 8/30/21

Question Types – Likert Scale

Indicate your level of agreement with the following
statement: Small airlines generally give better service
than large ones.
£ Strongly disagree
£ Disagree
£ Neither agree nor disagree
£ Agree
£ Strongly agree

15

Question Types – Semantic Differential

Indigo Airlines
Large ………………………………...…………….Small
Experienced………………….………….Inexperienced
Modern………………………..………….Old-fashioned

16

8
 8/30/21

Question Types – Importance Scale

Airline food service is _____ to me.

£ Extremely important
£ Very important
£ Somewhat important
£ Not very important
£ Not at all important

17

Question Types – Rating Scale

Indigo Airlines’ food service is _____.
£ Excellent
£ Very good
£ Good
£ Fair
£ Poor

18

9
 8/30/21

Question Types –
Intention to Buy Scale
How likely are you to purchase tickets on Indigo Airlines
if in-flight Internet access were available?
£ Definitely buy
£ Probably buy
£ Not sure
£ Probably not buy
£ Definitely not buy

19

Question Types –
Completely Unstructured
What is your opinion of Indigo?

1-20

20

10
 8/30/21

Question Types – Word Association

What is the first word that comes to your mind when

you hear the following?
Airline ________________________
Indigo _____________________
Travel ________________________

1-21

21

Question Types – Sentence Completion

When I choose an airline, the most important

consideration in my decision is:
_____________________________________________
_____________________________________________
_____________________________________________
_____________________________________________
_____________________________________________
_______________.

1-22

22

11
 8/30/21

Question Types – Story Completion

“I flew Indigo a few days ago. I noticed that the exterior

and interior of the plane were a rich dark blue in colour.
This aroused in me the following thoughts and feelings.”
Now complete the story.
_____________________________________________
_____________________________________________
_____________________________________________
_____________________________________________
_____________________________________________
_______________

1-23

23

Question Types –
Picture (Empty Balloons)

1-24

24

12
 8/30/21

Observational research
n Making observations of behavior and recording
those observations in an objective manner
n Must define scope of observations (i.e., how
broad or narrow)
n Most useful when investigating complex social
settings; less useful for studying well-defined
hypotheses under specific conditions
n Observations of culture versus psychology –
distinct questions

25

Stocking Experiment
(Nisbett and Wilson, 1977)
Which pair of stockings have the best quality?
60%
50%
40%
40%
31%
30%
20% 17%
12%
10%
0%
A B C D
Position

26

13
 8/30/21

Other problems with Usual Data

Gathering

n Bias in structure of questions/nature of data

gathered
n Demand effects/Desirable responses

27

Pre-Test & Pre-Launch Forecasting

• Used by firms across most industries
– Best for frequently purchased products and services (e.g.,
consumer non-durables, financial services, medical services,
insurance)

• Based on primary data collection

Concept Exposure
Key Measures
• Offering Survey Data
• Price
• Seek Info? Adjustment
• Intent Total Sales
• Liking •Demographics • 100% Aware
• Price / Value • Price / Value • 100% Available
• Uniqueness Perception
• Believability • Absolute Price Market Adjustment
• Need fulfillment • Category Usage
• Advertising
• Distribution
• Competition

Sales

28

14
 8/30/21

Pre-Test & Pre-Launch Forecasting ..contd.

• Further, companies like BASES have a large database (200K+ concepts, 68
markets) to benchmark likelihood of success of a new concept/product.
The score of a new product can be compared to any summary statistic
from any sub-sample from this database (e.g., could choose concepts that
match all 4Ps)

• In the example below, the new concept/product is compared against the

database “thirds” for comparison. Placement in the upper third of the
database indicates that the test product scored higher than two-thirds of
previous studies on that measure.

LOWER MIDDLE UPPER

Purchase Intent X
Liking X
Value/Price X
Uniqueness X
Believability X
Need fulfillment X

29

Pre-Test & Pre-Launch Forecasting ..

Continued
• Forecasting the sales (Q) of a new frequently purchased
product using
– Awareness of new brand (Aw)
– Availability of new brand (Av)
– Ultimate trial proportion conditional on awareness and availability (T)
– Long run share of purchases of new brand among those who try (R)
– Total category sales (C)
• Q = C * Aw * Av * T * R

Promotion

Advertising Sales &

Brand Initial Continued
Media Trial Market
Awareness Repeat Repeat
Weight Share

Distribution

30

15
 8/30/21

Pre-Test & Pre-Launch Forecasting: BASES

• BASES: Booz Allen Sales Estimation System

– Concept Screening: Pre-BASES
– Concept Development: BASES I
– Total Mix Evaluation: BASES II

• Forecasting Steps
– Generating Awareness (How many people will know about your idea ?)
– Estimating Distribution (Can interested consumers find your product?)
– Calculating Trial Appeal (How many people are interested in your idea?)
– Calculating Repeat Purchasing (Are triers satisfied enough to become repeaters?)
– Estimating Transaction Size (How many units will triers and repeaters purchase?)
– Incorporating the Impact of Promotions (How effective will your deals be at sweetening the
proposition?)

31

Typical BASES Forecasting Computation

Brand X

{
Households 100MM
Trial Trial Rate 10%
Volume Trial Units 1.1
Trial Volume 11 MM
+

{
Triers 10MM
Repeat Repeat Rate 40%
Volume Repeats/ Repeater 3.0
Repeat Units 1.2
Repeat Volume 14.4MM
=
Total Volume 25.4MM

32

16