Session 1 & 2 Introduction To Marketing Research & Research Design

Introduction to Marketing Research
Marketing Research
The American Marketing Association (AMA)

redefined Marketing Research as:
The function that links the consumer, the

customer, and public to the marketer
through INFORMATION
Marketing Research
Marketing 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 opportunities in marketing
Classification of Marketing Research
Problem-Identification Research
• Identify problems which are not necessarily apparent on
the surface & yet exist/likely to arise in the future.
Eg: market potential, market share, image, market
characteristics, sales analysis, forecasting, trends research.
Problem-Solving Research
• Solve specific marketing problems.
Eg: segmentation, product, pricing, promotion, distribution
research.
SEGMENTATION RESEARCH
 Determine the basis of segmentation

 Establish market potential & responsiveness
for various segments
 Select target markets
 Create lifestyle profiles: demography, media,
& product image characteristics
PRODUCT RESEARCH
 Test concept
 Determine optimal product design
 Package tests
 Product modification
 Brand positioning and repositioning
 Test marketing
PROMOTIONAL RESEARCH
Optimal promotional budget

Sales-promotion relationship
Optimal promotional mix
Media decisions
Creative advertising testing
Evaluation of advertising effectiveness
PRICING RESEARCH
Pricing policies
Importance of price in brand selection
Product line pricing
Price elasticity of demand
Initiating & responding to price changes
DISTRIBUTION RESEARCH
Determine…
Types of distribution
Attitudes of channel members
Intensity of wholesale & resale coverage
Channel margins
Location of retail & wholesale outlets
Marketing Research Process
Session 1 Step 1: Defining the Problem
Session 2 Step 2: Developing an Approach to the Problem
Research
Methodology Step 3: Formulating a Research Design
Elective
Step 4: Doing Field Work or Collecting Data
Statistics Step 5: Preparing and Analyzing Data
Step 6: Preparing and Presenting the Report

The Problem Definition Process
Tasks Involved
Discussion Interviews Secondary Qualitative

with with Data Research
Decision Maker(s) Experts Analysis
Environmental Context of the Problem
Step I: Problem Definition
Management Decision Problem
Marketing Research Problem
Step II: Approach to the Problem
Analytical Model: Specification

Objective/ Verbal, Research of
Theoretical Hypotheses
Graphical, Questions Information
Foundations
Mathematical Needed
Step III: Research Design

What the DM needs to do
Action oriented
Eg. How to recover the loss of mkt share?
vs.

What info is needed & how best can it be
obtained
Vs. Marketing Research Problem
Management Decision Problem Research Problem

1. Should the price be cut in response Determine the buyer- behavior at
to a price-cut by a competitor? various price levels.
2. Should the price of the brand be Determine the price elasticity of
increased? demand
3. Should the product ‘X’ be Assess the probable market size
introduced in the market? and share for ‘X’
To determine consumer preferences
and purchase intentions for X
Vs. Marketing Research Problem
Management Decision Problem Research Problem

4. Should the advertising campaign be Determine the effectiveness of the
changed? current advertising campaign
5. What should be done to increase Determine the strengths &
the relative market share of product weaknesses of ‘Y’ vis-à-vis those
‘Y’? of the competitors.
Research Question & Hypotheses
The Problem Definition Process
Tasks Involved


Objective/ Verbal, Research of
Graphical, Questions Information
Foundations
Mathematical Needed

Research Questions and Hypotheses
• Research questions (RQs) are

refined statements of the specific
components of the problem.
• A hypothesis (H) is an unproven
statement or proposition about a
phenomenon that is of interest to the
researcher. Often, a hypothesis is a
possible answer to the research question.
Research Question & Hypotheses
Research Question Hypotheses
1. What is the mean income of heavy- The lower income people consume
drinkers of beer? more beer
2. What will be the result on sales of a A 20% increase in price will not
20% increase in price? lead to a decrease in dollar sales.
3. What age group of purchasers of The age group 35–44 is the

product ‘X’ buys ‘X’ the most? heaviest user.
The Department Store Patronage Project
Tasks Involved


Objective/ Verbal, Graphical, Research of
Mathematical Questions Information
Foundations Needed

Defining the Problem
DM: We have seen a decline in the patronage of our

store
R: How do you know that?
DM: Well, it is reflected in our sales and market share.
R: Why do you think your patronage has declined?
DM: I wish I knew!
R: What about competition?
DM: I suspect we are better than competition on
some factors and worse than them on others.
R: How do the customers view your store?
DM: I think most of them view it positively, although
we may have a weak area or two.
What should be done to improve

the patronage of Sears?
• Competitors
• direct – department stores, regional
chains, national chains, discount stores…
• indirect – online…
• Relative strengths & weaknesses relative to

competitors
• Market potential
• Market share
• Sales analysis
• Business trends analysis
To determine the relative strengths &

weaknesses of Sears, vis-à-vis other
major competitors, with respect to
factors that influence store patronage.
• too broad, vague, or general

• too narrow
• Such errors can be reduced by

• first stating the problem in broad terms
• Break it down into components that can be addressed
separately.
• To find the answers to each component of the problem, it

is essential that a set of specific questions be formulated
that capture the essence of the part or component. These
specific questions are called research questions.
Research Problem into components

To determine the relative strengths & weaknesses of Sears,
vis-à-vis other major competitors, with respect to factors that
influence store patronage
Specifically, research should provide information pertaining to

the following narrower components.
Component 1.
What choice criteria do households use when selecting
department stores?


Component 2.
How do households evaluate Sears and competing stores
in terms of the choice criteria identified in q.1?


Component 3.
Which stores are patronized when shopping for specific
product categories?


Component 4.
What is the market share of Sears and its competitors for
specific product categories?


Component 5.
What is the demographic & psychological profile of the
customers of Sears? Does it differ from the profile of
customers of competing stores?

Component 1. What choice criteria do households use when selecting
department stores?
Component 2. How do households evaluate Sears and competing

stores in terms of the choice criteria identified in q.1?
Component 3. Which stores are patronized when shopping for

Component 4. What is the market share of Sears and its competitors

for specific product categories?
Component 5. What is the demographic & psychological profile of the

customers of Sears? Does it differ from the profile of customers of
competing stores?
Research Questions
Component 5
• RQ 1. Do Sears shoppers exhibit store loyalty?
• RQ 2. Are Sears shoppers heavy users of credit?
• RQ 3. Are they more appearance consciousness than shoppers

at other department stores?
• RQ 4. Do they combine shopping with eating out?

Research Questions
Component 5
• RQ 2. Are Sears shoppers heavy users of credit?
Further refined…
Does the shopper hold a Sears credit card?

Does the shopper use his Sears credit card?
How many times was the Sears credit card used in a specified
time period?
How much dollar amount was charged to the Sears credit card
during a specified time?
Hypotheses
Component 5
• RQ 1. Do Sears shoppers exhibit store loyalty?
H: Shoppers at Sears are loyal

Development of Research Questions & Hypotheses
Components of the
Objective/
Theoretical
Framework
Research Questions
Analytical
Model
Hypotheses
Specification of Information Needed

Component 1
What choice criteria do households use when
selecting department stores?
• The researcher identified the following factors as part of the

choice criteria: quality of merchandise, variety and assortment
of merchandise, returns and adjustment policy, service of store
personnel, prices, convenience of location, layout of store,
credit and billing policies.
• The respondents should be asked to rate the importance of
each factor as it influences their store selection.
Component 1
• RQ1: How important is competitive pricing?

HI: Competitive pricing is more important to the lower-
income shoppers.
• RQ2: How important is in-store service?

H2: Mere presence of salespeople is not enough; salespeople
should be friendly.

Component 2
How do households evaluate Sears and competing
stores in terms of the choice criteria identified in q.1?
• The researcher identified nine department stores as

competitors to Sears based on discussions with management.
• The respondents should be asked to evaluate Sears and its nine
competitors on the eight choice criteria factors.
Component 2
• RQ1: How do shoppers evaluate the quality of Sears’ brands

of merchandise?
H1: The quality of Sears’ brands is much higher for hardware
than for apparel.
• RQ2: Are Sears stores conveniently located?

H2: Sears stores are conveniently located for shoppers living
in the suburbs.

Component 3
Which stores are patronized when shopping for
• 16 different product categories were selected, including

women's dresses, women's sportswear, lingerie and body
fashion, junior merchandise, men's apparel, cosmetics,
jewelry, shoes, sheets and towels, furniture and bedding,
and draperies.
• The respondents should be asked whether they shop at each
of the 10 stores for each of the 16 product categories.
Component 3
• RQ1: Is Sears preferred for hardware?

H1: Sears is preferred over competitors for the purchase of
hardware.
• RQ2: Is Sears preferred for the purchase of women’s clothing?

H2: Shoppers prefer to purchase women’s clothing at upscale
department stores.

Component 4
What is the market share of Sears and its
competitors for specific product categories?
• No additional information needs to be obtained from the

respondents.
Component 4
• RQ1: What is Sears’ market share for hardware?

H1: Sears’ market share is higher in hardware than it is in
men’s clothing.
• RQ2: How does Sears’ market share compare to Macy’s in

home furnishings?
H2: Macy’s has a larger market share than Sears’ in home
furnishings.

Component 5
What is the demographic & psychological
profile of the customers of Sears? Does it
differ from the profile of customers of
competing stores?
• Information should be obtained on the standard

demographic characteristics and the
psychographic characteristics of store loyalty,
credit use, appearance consciousness, and
combining shopping with eating.

Component 5
• RQ1: How is store patronage related to store evaluations?

• H1: Store patronage is a linear function of store
evaluations.
• RQ2:Which demographic characteristic is the most important

in influencing store patronage?
• H2: Income is the most important demographic
characteristic in influencing store patronage
Tasks Involved


Objective/ Verbal, Graphical, Research of
Mathematical Questions Information
Foundations Needed

Research Design: Definition
• Framework or blueprint for conducting the

marketing research project
• The procedures necessary for obtaining
the information needed to structure or
solve marketing research problems.
A Classification of Marketing Research Designs
Research Design
Exploratory Conclusive
Research Design Research Design
Descriptive Research Causal Research

Uses of Exploratory Research
• Formulate or define a problem more

precisely
• Identify alternative courses of action
• Develop hypotheses
• Isolate key variables & relationships for
further examination
• Gain insights for developing an approach
to the problem
• Establish priorities for further research
Methods of Exploratory Research
• Survey of experts
• Pilot surveys
• Secondary data analyzed in a qualitative way
• Qualitative research
Exploratory & Conclusive Research Differences
Exploratory Conclusive
Objective: To provide insights and To test specific hypotheses and
understanding examine relationships
Character- Info needed is loosely defined Info needed is clearly defined.

istics:
Research – flexible, unstructured. Research – formal, structured.
Sample – large, representative.

Sample – small
Data analysis - quantitative
Primary data analysis- qualitative
Findings/
Results: Conclusive
Tentative
Outcome: Findings used as input into decision

Generally followed by further making
exploratory or conclusive
research
A Comparison of Basic Research Designs
Exploratory Descriptive Causal

Objective: Discovery of ideas Describe market Determine cause
and insights characteristics or and effect
functions relationships
Characteristics: Flexible, versatile Marked by the prior Manipulation of

formulation of specific independent
hypotheses variables, effect
on dependent
Often the front end Preplanned and variables
of total research structured design
design Control mediating
variables
Methods: Expert surveys Secondary data: Experiments

Pilot surveys quantitative analysis
Case studies Surveys
Secondary data: Panels
qualitative analysis Observation and other
qualitative research data
Situations for descriptive research use
1. Market studies - size of the market, buying power

of the consumers, availability of distributors,
consumer profiles.
2. Market share studies - proportion of total sales

received by a company & its competitors.
3. Sales analysis studies - sales by geographic region,

product line, type
4. Image studies - consumer perceptions of the

firm/its products.
Situations for descriptive research use
5. Product usage studies - consumption patterns.
6. Distribution studies - traffic flow patterns, the

number & location of distributors.
7. Pricing studies - range & frequency of price changes

and probable consumer response to proposed price
changes.
8. Advertising studies - media consumption habits &

audience profiles for specific television programs/
magazines.
Six W’s of descriptive research
Who: who should be considered?
Where: where should the respondents be contacted to

obtain the reqd info?
When: when should the info be obtained from respondents?
What: what info should be obtained from the respondents?
Why: why are we obtaining info from the respondents?
Way: The way in which we are going to obtain info from the
respondents?
Sweet Cookies
Sweet Cookies is planning to launch a new line

of cookies & wants to assess the market size.
The cookies have a mixed chocolate-pineapple
flavor & will be targeted at the premium end of
the market.
Sweet Cookies
Management problem & research problem
Sweet Cookies is planning to launch a new line

of cookies & wants to assess the market size.
The cookies have a mixed chocolate-pineapple
flavor & will be targeted at the premium end of
the market.
Sweet Cookies
Management problem & research problem

Sweet Cookies is planning to launch a new line of cookies & wants to
assess the market size. The cookies have a mixed chocolate-pineapple
flavor & will be targeted at the premium end of the market.
Management Problem:
What can be done to increase the market share
of the mixed chocolate-pineapple flavor cookie?
Research Problem:
Determine the market size of a mixed
chocolate pineapple flavor cookie and the
strengths & weaknesses of similar products, if
any, already in the market.
Sweet Cookies
Specific research questions to the research problem

Research Problem: Determine the market size of a mixed chocolate

pineapple flavor cookie and the strengths & weaknesses of similar
products, if any, already in the market.
1. What is the size of the cookie market?

2. What is the potential size of the market for a
chocolate pineapple flavor cookie?
3. What attributes do consumers desire in
cookies?
Sweet Cookies
Research Design
Sweet Cookies is planning to launch a new line of cookies & wants to assess the
market size. The cookies have a mixed chocolate-pineapple flavor & will be
targeted at the premium end of the market.
1st phase - exploratory research

• Consumers’ attitudes & feelings might be obtained
regarding the cookie market and the desire for this
particular cookie.
• Focus groups & depth interviews.
2nd phase - descriptive research (Based on the findings

of the initial exploratory research)
• To estimate the percentage of consumers that might
purchase the cookie
• Estimate the money they would be willing to spend.
Sweet Cookies

(a)Who— Who should be considered a

consumer of chocolate-pineapple cookies?
Some possibilities are:

Anyone who buys cookies
Anyone who buys premium priced cookies
Anyone who buys chocolate cookies
Anyone who has bought Sweet brand cookies
Sweet Cookies

(b) Where—Where should the respondents be

contacted to obtain the required information?
• In the grocery store

• At home
• In the parking lot
Issues: shopper fatigue, recency, time lapse, intention vs.

action, private vs. public, interruptions, ….
Sweet Cookies

(c)When—When should the information be

obtained from the respondents?
• Before purchasing their groceries

• While purchasing their groceries
• Immediately after purchasing their groceries
• Within two weeks of purchasing their
groceries
Sweet Cookies

(d) What—What information should be

obtained from the respondents?
• Demographics
• Psychographics & Lifestyles
• Attitude toward chocolate pineapple cookies
• Attitude toward the premium price
1st phase - exploratory research
• Consumers’ attitudes & feelings might be obtained regarding the cookie market and the desire for
this particular cookie.
Sweet Cookies

(e) Why—Why are we obtaining information

from the respondents?
• To determine consumer attitudinal reaction

to the new cookie
• To determine the market size
Sweet Cookies

(f) Way—The possible ways in which we are

going to obtain information from the
respondents.
• Observational techniques
• Scanner Data
1. What is the size of the cookie market?
• Personal interview 2. What is the potential size of the market
for a chocolate pineapple flavor cookie?
• Telephone interview 3. What attributes do consumers desire in
cookies?
• Mail interview
Ethnography
P&G : Gillette in India
Gillette had 50% of the upscale Indian market, but

had very little impact among poorer Indians & in
rural markets.
Knowing that the ProGlide was too costly for the low
end Indian market, P&G sent a team of
ethnographers to study Indian men shaving.
Ethnography
Ethnographic methods –
Depth interviews
Observations of rural men shaving
Shop-alongs as men bought shaving products
Home visits to see shaving & shaving facilities
Test shaves with possible new razors
• >1,000 hrs conducting the research.

Ethnography
Findings:
Ethnography
Findings:
• Rural Indian men typically shave outdoors - squatting

down, with a hand-held cup of cold water, a small
mirror, & a double-bladed razor invented 100 years
ago.
• Typically do not shave everyday & shaving the stubble

in this way results in frequent cuts.
• Shaving indoors - dim lighting.
• Great pride in getting a good shave despite these less

than ideal shaving circumstances.
Ethnography
Solution (Part 2 of your group project!)
Product
Gillette Guard - a simple 3piece plastic razor
Has a large safety comb to prevent nicks
Easy to clean with little water
Price
Costs - only 3% of manufacture cost of Fusion ProGlide.
Price - Rs.15 with replacement cartridges selling for Rs.5
~ 1 rupee (2 US cents) per shave
Distribution
Made entirely in India.
October 2010 - Gillette introduced the Guard in millions of small shops
Promotion
Advertised it using Bollywood actors.
Ethnography
Result P&G : Gillette in India
Within 6 months, 50% market share
Future
In near future Gillette will be rolling out the Guard in China &
Africa, with other emerging markets to follow.
In the long term, the company plans to bring the product to North
America where it will compete with the Fusion ProGlide.
This reverse path of innovation will provide a hedge against being
beaten out by a competitor's disruptive technology.
Ethnography
P&G : Gillette Venus
Shaving
Razing
Gliding
Package Instructions
Usage guidelines – no clue about shaving
procedure
Consumer behavior among certain religious

sects
Bill & Melinda Gates Foundation: Breaking India's dirty habit of open defecation
Low-cost Dry-toilet by UNICEF
• In 40% households that have toilets, at least one person

regularly defecates in the open.
• <50% of people who own a govt toilet use it regularly.
Appreciated by water-scarce
regions in Rajasthan
Opposed in rural areas not facing

availability problem
MANAGEMENT DECISION PROBLEM

RESEARCH PROBLEM
Segmentation/ Targeting problem

Distribution problem
Image problem
Communication problem
Pricing problem
…
??
Video UNICEF Total Sanitation TVC Ghunghat
Men were being let off scot-free, as communication focused

on women and children
Previous communication narratives were around:

• Rational benefits – explaining the ill effects of open
defecation, spread of disease, affecting/stunting the growth
of children.
• Emotional appeals used "safety of women"; "protect
family health" to encourage toilet construction.
• There wasn't any communication that addressed men who
were accustomed to open defecation.
• Emotional narrative/ Health scares/preachy tone used was
found to be patronising in tone by men
Solution (Part 2 of your group project!)

Promotion Mix
https://www.warc.com/content/article/warc-prize-
asia/bill_amp;_melinda_gates_foundation_breaking_indias_dirty_habit_of_open_defecation/111808
How P&G Brought the Diaper Revolution to China
MANAGEMENT PROBLEM
When P&G set out to sell Pampers in China a decade ago, it

faced a daunting marketing challenge
P&G didn't just have to persuade parents that its diapers were the
best.
It had to persuade them that they needed diapers at all.
The disposable diaper — a throwaway commodity in the West —

just wasn't the cultural norm in Chinese nursery
Babies wore cloth diapers

EXPLORATORY RESEARCH
CULTURAL CONTEXT
Babies sleep between parents
Joint families
A society obsessed with academic achievement
One-child policy
Hygiene concept – western vs. Chinese
Potty training begins as early as 6 months (vs 22–

30 months for western infants) - children
wear kaidangku — colorful open-crotch pants that
let them squat & relieve themselves in open areas
RESEARCH INSIGHT
Customer Problem
Good sleep for kid’s brain development

Another round of Exploratory Research!
A new CUSTOMER PROBLEM
A good night’s sleep
“Moms say the same things over and over - We want

more sleep”
Are the parents ready to forego the next day’s

breakfast (comparable cost) for a comfortable sleep?
FAILED SOLUTION
(Part 2 of your group project!)
Watered-down product; strategy of making a

cheaper version of their Western product
Less soft; product was perceived as plastic

and irritating
SOLUTION (Part 2 of your group project!)
PRODUCT STRATEGY
Delight, don’t dilute
The diaper needed to be cheap
But it also had to do what other cheap

diapers didn’t — keep a baby dry for 10
hours & be as comfortable as cloth
2006: revised product - Pampers Cloth

Like & Dry
SOLUTION (Part 2 of your group project!)

PROMOTION STRATEGY
“Golden Sleep” campaign - mass carnivals & in-store

campaigns in China’s urban areas.
Viral campaign on Pampers Chinese website asked
parents to upload photos of their sleeping babies to
drive home the study’s sleep message.
Ad campaign boasted “scientific” results, such as

“Baby Sleeps with 50% Less Disruption” & “Baby
Falls Asleep 30% Faster.”
INDIA
P&G tweaks the sales pitch to fit different markets
In India, the convenience of disposable diapers doesn’t

resonate with parents.
Many Indian mothers think that only lazy moms put their
babies in disposable diapers that last a full night.
Had to change that mindset & educate that using a diaper

is not about convenience for you — it’s about your baby’s
development.

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Introduction to Marketing Research

The American Marketing Association (AMA)

The function that links the consumer, the

Marketing research is the systematic and objective

For the purpose of improving decision making related to the

 Determine the basis of segmentation

Optimal promotional budget

Session 1 Step 1: Defining the Problem

Session 2 Step 2: Developing an Approach to the Problem

Step 4: Doing Field Work or Collecting Data

Statistics Step 5: Preparing and Analyzing Data

Step 6: Preparing and Presenting the Report

Discussion Interviews Secondary Qualitative

Environmental Context of the Problem

Step I: Problem Definition

Management Decision Problem

Marketing Research Problem

Step II: Approach to the Problem

Analytical Model: Specification

Step III: Research Design

Marketing Research Problem

Management Decision Problem Research Problem

Management Decision Problem Research Problem

Discussion Interviews Secondary Qualitative

Environmental Context of the Problem

Step I: Problem Definition

Management Decision Problem

Marketing Research Problem

Step II: Approach to the Problem

Analytical Model: Specification

Step III: Research Design

• Research questions (RQs) are

Research Question Hypotheses

3. What age group of purchasers of The age group 35–44 is the

Discussion Interviews Secondary Qualitative

Environmental Context of the Problem

Step I: Problem Definition

Management Decision Problem

Marketing Research Problem

Step II: Approach to the Problem

Analytical Model: Specification

Step III: Research Design

Defining the Problem

DM: We have seen a decline in the patronage of our

Management Decision Problem

What should be done to improve

• Relative strengths & weaknesses relative to

Marketing Research Problem

To determine the relative strengths &

Marketing Research Problem

• too broad, vague, or general

• Such errors can be reduced by

• To find the answers to each component of the problem, it

Research Problem into components

Specifically, research should provide information pertaining to

Research Problem into components

Specifically, research should provide information pertaining to