Chapter 1

Introduction and Early Phases of Marketing Research

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Redefining 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

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Redefining Marketing Research Used to identify and define market opportunities and problems Generate, refine, and evaluate marketing performance Monitor marketing performance Improve understanding of marketing as a process
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Definition of 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
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Market Research

Specifies the information necessary to address these issues Manages and implements the data collection process Analyzes the results Communicates the findings and their implications Helps managers use this information to make decisions
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Classification of Marketing 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. Examples: market potential, market share, image, sales analysis, forecasting, and trends research. Problem-Solving Research Research undertaken to help solve specific marketing problems. Examples: segmentation, product, pricing, promotion, and distribution research.
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A Classification of Marketing Research

Fig. 1.1

Marketing Research

Problem Identification Research Market Potential Research Market Share Research Sales Analysis Research Forecasting Research Business Trends Research
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Problem-Solving Research Segmentation Research Product Research Pricing Research Promotion Research Distribution Research 1-7

Problem-Solving Research
Table 1.1 SEGMENTATION RESEARCH Determine the basis of segmentation Establish market potential and PRODUCT RESEARCH Test concept responsiveness for various segments Select target markets Determine optimal product design

Package tests Create lifestyle profiles: demography, media, and Product modification product image characteristics Brand positioning and repositioning
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Test marketing

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Problem-Solving Research
Table 1.1 cont. PROMOTIONAL RESEARCH Optimal promotional budget Sales promotion relationship Optimal promotional mix Copy decisions Media decisions Creative advertising testing PRICING RESEARCH Product line pricing Price elasticity of demand Initiating and responding to price changes
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Evaluation of advertising effectiveness Importance of price in brand selection

$ALE
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Problem-Solving Research
Table 1.1 cont. DISTRIBUTION RESEARCH

Determine Types of distribution Attitudes of channel members Intensity of wholesale & resale coverage Channel margins Location of retail and wholesale outlets

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Marketing Research Process

Step 1 Step 2 Step 3 Step 4 Step 5 Step 6

: Problem Definition : Development of an Approach to the Problem : Research Design Formulation : Fieldwork or Data Collection : Data Preparation and Analysis : Report Preparation and Presentation

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Marketing Research Process

Step 1: Defining the Problem Step 2: Developing an Approach to the Problem Step 3: Formulating a Research Design Step 4: Doing Field Work or Collecting Data Step 5: Preparing and Analyzing Data Step 6: Preparing and Presenting the Report
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The Role of Marketing Research

Fig. 1.2
Customer Groups Consumers Employees Shareholders Suppliers

Controllable Marketing Variables Product Pricing Promotion Distribution

Uncontrollable Environmenta l Factors Economy Technology Laws & Regulations Social & Cultural Factors Political Factors

Marketing Research

Assessing Marketing Providing Information Decision Information Making Needs

Marketing Managers Decisions for marketing mgrs s complicated by Controlling variables

Market Segmentation Target Market Selection Marketing Programs Performance & Control
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Power Decisions Methodology

Fig. 1.3
Opportunity scan

Solve Problem

Option generation Refine options Decision

Client Needs

Fin d

Seek

Pla n

Act

Achieve Goal

Advise Market ResearchEvaluate Clarify How We Assist Plan Decisions Analysis Interpret Recommend Research Execution Facilitate Help

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Marketing Research Suppliers & Services

Fig. 1.4

INTERNAL
Mktg research depts in the firm

RESEARCH SUPPLIERS

EXTERNAL
Co's hired to supply data

FULL SERVICE
Syndicat e Services Standardize d Services Internet Service s Customiz ed Services

LIMITED SERVICE
Field Service s Focus Groups and Qualitative Services Other Service s Technical and Analytical Services
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Firms
U.S. Rank U.S. 2007 2006 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 1 2 3 5 4 6 7 8 9 10 11 13 12 14 15 The Nielsen Co. IMS Health Inc. Kantar Group* Westat Inc. IRI TNS U.S. Arbitron Inc. GfK AG USA Ipsos Synovate Maritz Research J.D. Power and Associates* Harris Interactive Inc. The NPD Group Inc. Opinion Research/ Guideline Group Opinion Research Corp. New York Norwalk, Conn. Fairfield, Conn. Rockville, MD Chicago New York New York Nuremberg, Germany New York London Fenton, Mo. Westlake Village, Calif. Rochester, N.Y. Port Washington, N.Y. Omaha, Neb. Princeton, N.J. nielsen.com imshealth.com kantargroup.com westat.com infores.com tnsglobal.com arbitron.com gfk.com ipsos-na.com synovate.com maritzresearch.com jdpower.com harrisinteractive.com npd.com infousa.com opinionresearch.com $2,173.0 801.0 526.8 467.8 441.0 379.8 338.5 319.7 281.2 250.4 187.4 184.5 161.0 160.4 124.7 97.5 $4,220.0 2,192.6 1,551.4 467.8 702.0 2,137.2 352.1 1,603.00 1,270.30 867.0 223.3 260.5 227.0 211.1 206.7 179.5 48.5% 63.5 66.0 37.2 82.2 3.9 80.1 77.9 71.1 16.1 29.2 29.1 24.0 39.7 45.7 Organization Headquarters Website U.S. Global
Revenue, $, in millions Revenue, $, in millions Revenue

Non-

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Firms
U.S. Rank U.S. 2006 2007 38 16 17 18 20 20 37 18 19 17 19

(Cont)
Organization Headquarters Website U.S. Global Non-

Guideline Inc. comScore Inc. Market Strategies Inc. Market Strategies Inc. Flake-Wilkerson Market Insights Lieberman Research Worldwide Abt Associates Inc.

New York Reston, Va. Livonia, Mich. Livonia, Mich. Little Rock, Ark. Los Angeles Cambridge, Mass.

guideline.com comscore.com marketstrategies.com markestrategies.com fw-mi.com Irwonline.com abtassociates.com

26.8 77.0 75.7 53.4 22.3 71.0 55.1

26.8 87.2 80.4 58.1 22.3 87.4 55.1

11.7 5.8 8.1 18.8

Abt Associates Inc. 41 20 21 22 23 23 25 26 23 21 22 26 25 24 40 Abt SRBI Inc. OTX Burke Inc. MVL Group Inc. Knowledge Networks Inc. National Research Corp. Directions Research Inc. Phoenix Marketing International

Cambridge, Mass. New York Los Angeles Cincinnati Jupiter, Fla. Menlo Park, Calif. Lincoln, Neb. Cincinnati Rhineback, N.Y.

abtassociates.com srbi.com otxresearch.com burke.com mvlgroup.com knowledgenetworks.com nationalresearch.com directionsresearch.com phoenixmi.com

33.0 22.1 50.8 47.0 42.3 37.3 37.3 37.2 33.5

33.0 22.1 54.5 53.1 42.3 37.3 41.3 37.2 34.9

6.8 11.5 9.7 4.0

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Firms
U.S. Rank U.S. 2006 2007 27 34 28 27 29 28 30 33 31 36 32 39 33 32 34 31 35 44 36 34 37 38 42 39 43 40 47 41

(Cont)
Organization Headquarters Website U.S. Global Non-

Lieberman Research Group ICR/Int'l Communications Research Morpace Inc. MarketCast Data Development Worldwide C&R Research Services Inc. Informa Research Services Inc. National Analysts Worldwide Service Management Group Market Probe Inc. Hitwise Walker Information KS&R Inc. Bellomy Research Inc.

Great Neck, N.Y. Media, Pa. Farmington Hills, Mich. Los Angeles New York Chicago Calabasas, Calif. Philadelphia Kansas City, Mo. Milwaukee New York Indianapolis Syracuse, N.Y. Winston-Salem, N.C. Cincinnati Alexandra, Va.

liebermanresearch.com icrsurvey.com morpace.com marketcastonline.com datadw.com crresearch.com informars.com nationalanalysts.com servicemanagement.com marketprobe.com hitwise.com walkerinfo.com ksrinc.com bellomyresearch.com marketvisionresearch.com pos.org

30.1 28.8 28.7 25.1 25.0 23.6 23.5 23.3 22.4 21.7 21.6 21.2 17.1 16.7 16.4 15.5

30.1 29.7 33.2 25.1 25.3 23.6 23.5 23.3 23.0 41.4 49.9 25.5 21.0 16.7 16.4 15.5

3.0 13.6

1.2 2.6 47.6 56.7 16.9 18.6

46 MarketVision Research Inc. Inc. Copyright 2010 Pearson Education, 42 28 Public Opinion Strategies

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U.S. Rank Non-U.S. 2007 2006 43 44 45 46 47 48 49 50 45 48 49 50

Firms

(Cont)
Organization Headquarters Website U.S. Global

Compete Inc. Savitz Research Companies RDA Group Inc. Gongos Research Inc. Q Research Solutions Inc. Marketing Analysts Inc. RTi Market Research & Brand Strategy The Link Group

Boston Dallas Bloomfield Hills, Mich. Auburn Hills, Mich. Old Bridge, N.J. Charleston, S.C. Stamford, Conn. Atlanta

compete.com savitzresearch.com rdagroup.com gongos.com whoisq.com marketinganalysts.com rtiresearch.com the-link-group.com

14.9 14.8 13.7 13.3 13.0 12.8 12.2 11.9

14.9 14.8 16.8 13.3 13.2 13.6 12.2 13.3

18.5 1.5 5.9 10.5

Total All other (150 CASRO companies not included in the Top 50)

$7.828.7

$17,638.0

55.6%

$774.3

$870.1

11.0%

Total (200 companies)

$8,603.0

$18,508.1

53.5%

*Estimated by Top 50.

U.S. and worldwide revenue may include nonresearch activities for some companies that are significantly higher. Rate of growth from year to year has been adjusted so as not to include revenue gains or losses from acquisitions or divestitures. Total revenue of 150 survey research companies that provide financial information on a confidential basis to CASRO.

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Selected Marketing Research Career Descriptions

Fig. 1.5
Vice President of Marketing Research: The senior position in marketing research. The vice president (VP) is responsible for the entire marketing research operation of the company and serves on the top management team. This person sets the objectives and goals of the marketing research department. Research Director: Also a senior position. The research director has the general responsibility for the development and execution of all the marketing research projects. Assistant Director of Research: Serves as an administrative assistant to the director and supervises some of the other marketing research staff members. (Senior) Project Manager: Has overall responsibility for design, implementation, and management of research projects. Statistician/Data Processing Specialist: Serves as an expert on theory and application of statistical techniques. Responsibilities include experimental design, data processing, and analysis.
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Selected Marketing Research Career Descriptions

Fig. 1.5 cont. Vice President of Marketing Research
Part of companys top management team Directs companys entire market research operation Sets the goals & objectives of the marketing research department

Research Director
Also part of senior management Heads the development and execution of all research projects

Assistant Director of Research

Administrative assistant to director Supervises research staff members

Senior Project Manager

Responsible for design, implementation, & research projects

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Selected Marketing Research Career Descriptions

Fig. 1.5 cont. Senior Analyst
Participates in the development of projects Carries out execution of assigned projects Coordinates the efforts of analyst, junior analyst, & other personnel in the development of research design and data collection Prepares final report

Analyst

Handles details in execution of project Designs & pretests questionnaires Conducts preliminary analysis of data

Statistician/Data Processing

Junior Analyst

Serves as expert on theory and application on statistical techniques Oversees experimental design, data processing, and analysis

Secondary data analysis Edits and codes questionnaires Conducts preliminary analysis of data
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Fieldwork Director

Handles selection, training, supervision, and evaluation of interviewers and field workers
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Marketing 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
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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? Has the firm had experience with projects similar to this one? 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.
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Careers in Marketing Research

Career opportunities are available with marketing research firms (e.g., AC Nielsen, Burke) Careers in business and non-business firms and agencies with in-house marketing research departments (e.g., Procter & Gamble, Coca-Cola, the Federal Trade Commission, United States Census Bureau) Advertising agencies (e.g., BBDO International, Ogilvy & Mather, J. Walter Thompson) Positions: VP of marketing research, research director/assistant director, project manager, field work director, statistician/data processing specialist, senior/junior analyst, and supervisor

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A Sample of Marketing Research Jobs

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Preparation for a Career in Marketing Research

Take all the marketing courses you can. Take courses in statistics and quantitative methods. Acquire Internet and computer skills. Knowledge of programming languages is an added asset. Take courses in psychology and consumer behavior. Acquire effective written and verbal communication skills. Think creatively. Creativity and common sense command a premium in marketing research.

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