Mma6e Chapter 04 - Final 186604

Marketing Management:
An Asian Perspective,
6th Edition
Instructor Supplements
Created by Geoffrey da Silva
Conducting Marketing Research
3 Pearson Education South Asia Pte Ltd 2013. All rights reserved
4
Learning Issues for Chapter Four
1. What constitutes good marketing research?
2. What are the best metrics for measuring marketing

productivity?
3. How can marketers assess their return on investment of

marketing expenditures?
Importance of Market Information and Research
Good marketers need insights to help them interpret past

performance as well as plan future activities.
To make the best possible tactical decisions in the short run

and strategic decisions in the long run, they need timely,
accurate, and actionable information about consumers,
competition, and their brands.
Discovering a consumer insight and understanding its

marketing implications can often lead to a successful product
launch or spur the growth of a brand.
The Marketing Research System
Marketing managers often commission formal marketing

studies of specific problems and opportunities.
Marketing insights provide diagnostic information about

how and why we observe certain effects in the marketplace,
and what that means to marketers.
Good marketing insights often form the basis of successful

marketing programs.
Gaining marketing insights is crucial for marketing success.
Definition of Marketing Research
We define marketing research as the systematic design,

collection, analysis, and reporting of data and findings
relevant to a specific marketing situation facing the company.
Most large companies have their own marketing research

departments, which often play crucial roles within the
organization.
Small Companies and MR
Small companies can hire the services of a marketing research

firm or conduct research in creative and affordable ways, such
as:
Engaging students or professors to design and carry out
projects
Using the Internet
Checking out rivals
Tapping into partner expertise
Types of Marketing Research Firms
1. Syndicated-service research firmsThese firms gather

consumer and trade information, which they sell for a fee.
Example: A.C. Nielsen Media Research.
2. Custom marketing research firmsThese firms are hired to

carry out specific projects. They design the study and report the
findings.
3. Specialty-line marketing research firmsThese firms provide

specialized research services. The best example is the field-
service firm, which sells field interviewing services to other
firms.
Marketing Research Hindustan Unilever
Managers at Hindustan Unilever have direct contact with consumers to find out their perceptions of
their products. This led to a repositioning of Lifebuoy as a family soap.
Example of a Research Brief
Japan Airlines (JAL) is looking for new ways to serve its passengers. It
is reviewing many new ideas, especially to cater to its first-class
passengers on very long flights, many of whom are businesspeople
whose high-priced tickets pay for most of the freight. Among these
ideas are (1) an Internet connection with access to Web pages and
email messaging; (2) 24 channels of satellite cable TV; and (3) a 50-
CD audio system that lets each passenger create a customized playlist
of music and movies to enjoy during the flight. The marketing
research manager was assigned to investigate how first-class
passengers would rate these services and how much extra they would
be willing to pay if a charge was made. He was asked to focus
specifically on the Internet connection.
Example of a Research Brief
One estimate says that airlines might realize revenues of $70 billion
over the next decade from in-flight Internet access, if enough first-
class passengers would be willing to pay $25 for it. JAL could thus
recover its costs in a reasonable time. Making the connection available
would cost the airline $90,000 per plane.
The Marketing Research Process
Effective marketing research involves six steps:
Step 1: Define the Problem, the Decision
Alternatives, and the Research Objectives
Marketing management must be careful not to define the
problem too broadly or too narrowly for the marketing
researcher.
An airline looking to add in-flight Internet service would need to conduct careful
consumer research.
Nature of Research Objectives and Tasks
Some research is exploratoryits goal is to shed light on

the real nature of the problem and to suggest possible
solutions or new ideas.
Some research is descriptiveit seeks to quantify demand.
Some research is causalits purpose is to test a cause-and-

effect relationship.
Step 2: Develop the Research Plan
The second stage of marketing research is where the

researcher will develop the most efficient plan for gathering
the needed information at a given cost.
To design a research plan, the researcher needs to make

decisions about the data sources, research approaches,
research instruments, sampling plan, and contact methods.
Step 2: Develop the Research Plan
Research
Data Sources
Approach
Research
Sampling Plan
Instruments
Contact
Methods
Data Sources
The researcher can gather secondary data, primary data, or

both.
Secondary data are data that were collected for another

purpose and already exist somewhere.
Primary data are data freshly gathered for a specific

purpose or for a specific research project.
Research Approaches
Observation
Observation
Ethnographic
Ethnographic
Focus
Focus Group
Group
Survey
Survey
Behavioral
Behavioral Data
Data
Experimentation
Experimentation
Observational Research
Fresh data can be gathered

by observing the relevant
actors and settings.
Consumers can be
unobtrusively observed as
they shop or as they
consume products.
Observational Research
Fisher-Price set up an observation lab in which it could observe the reactions of little tots to new
toys.
Ethnographic Research
Is a particular observational research approach that uses

concepts and tools from social sciences to provide deep
understanding of how people live and work.
The goal is to immerse the researcher into consumers lives to

uncover unarticulated desires that might not surface in any
other form of research.
Focus Group Research
A focus group is a gathering

of 6 to 10 people carefully
selected based on certain
demographic, psychographic,
or other considerations and
brought together to discuss
various topics of interest at
length.
Unlike paper-and-pencil surveys, focus-group interviews allow participants

to discuss freely their thoughts and feelings. In Asia, researchers need to
be mindful of cultural nuances such as deference to seniority. In more
conservative Asian countries, men and women attend separate focus
groups.
Focus Group Methods:
A professional research moderator provides questions and

probes based on the marketing managers discussion guide or
agenda.
Moderators try to discern consumers real motivations and

why they say and do certain things.
The sessions are typically recorded.
Challenges of Focus Group Research in Asia
In Asia, some cultural sensitivities may require that focus

group sessions be segregated between male and female
participants, or even by age.
Older participants may find it offensive to be in the same

group as younger participants, while younger participants
may defer in their opinions to those of the older participants.
See Marketing Memo: Conducting Informative Focus Groups

for practical tips to improve the quality of focus groups.
Survey Research
Companies undertake surveys

to learn about peoples
knowledge, beliefs, preferences,
and satisfaction, and to
measure these magnitudes in
the general population.
Behavioral Data Research
Customers leave traces of their purchasing behavior in store

scanning data, catalog purchases, and customer databases.
Much can be learned by analyzing these data.
Actual purchases reflect consumers preferences and often are

more reliable than statements they offer to market
researchers.
People may report preferences for popular brands, and yet

the data show them actually buying other brands.
Behavioral Data Research: Store Scanners
Store-scanner data can

provide rich information
about brand preferences,
competitive promotional
effects, and customer
profile.
More importantly, they

reveal behavioral rather
than attitudinal responses
Experimental Research
The most scientifically valid research is experimental

research.
Designed to capture cause-and-effect relationships by

eliminating competing explanations of the observed findings.
Experiments call for:

i. Selecting matched groups of subjects.
ii. Subjecting them to different treatments.
iii. Controlling extraneous variables.
iv. Checking whether observed response differences are
statistically significant.
Research Instruments
Marketing researchers have a choice of three main research

instruments in collecting primary data:
questionnaires,
qualitative measures, and
mechanical devices.
Questionnaires
A questionnaire consists of a set of questions presented to

respondents.
Because of its flexibility, is by far the most common instrument used

to collect primary data.
Questionnaires need to be carefully developed, tested, and debugged

before being administered.
i. The researcher carefully chooses the questions, wording, and
sequence.
ii. The form of the question can influence the response.
iii. Marketing researchers use both closed-ended and open-ended
questions.
Questionnaires
Dos and Donts
Qualitative Measures
Some marketers prefer more qualitative methods for gauging

consumer opinions because consumer actions do not always
match their answers to survey questions.
Qualitative research techniques are relatively unstructured

measurement approaches that permit a range of possible
responses.
Qualitative Measures (continued)
Qualitative research techniques are a creative means of

ascertaining consumer perceptions that may otherwise be
difficult to uncover.
Because of the freedom it affords both researchers in their

probes and consumers in their responses, qualitative research
can often be an especially useful first step in exploring
consumers brand and product perceptions.
Drawbacks of Qualitative
Marketers must temper the in-depth insights that emerge

with the fact that the samples are often very small and may
not necessarily generalize to broader populations.
And different researchers examining the same qualitative

results may draw very different conclusions.
Qualitative Research Approaches
Some other popular qualitative research approaches to get

inside consumers minds and find out what they think or feel
about brands and products include:
a. word associations
b. projective techniques
c. visualizations
d. brand personification
e. laddering
See Marketing Insight: Getting into Consumers Heads with

Qualitative Research
Technological Devices
Technological devices are occasionally used in marketing

research.
i. Galvanometers
ii. Tachistoscope
iii. Audiometers
Technology has now advanced to such a degree that

marketers can use devices such as skin sensors, brain wave
scanners, and full body scanners to get consumer responses.
Technological Devices (continued)
Technology has replaced the diaries that participants in media

surveys used to keep. Audiometers attached to television sets
in participating homes now record when the set is on and to
which channel it is tuned.
Use of Technology in Customer Feedback
Changi Airport Singapore targets airline passengers to rate its public restrooms. It installed touch
screens at its restrooms for feedback.
Marketing Insight: Understanding Brain Science
Using neuroscience or neuromarketing, a term used to

describe brain research on the effect of marketing stimuli.
Sampling Plan
After deciding on the research approach and instruments, the

marketing researcher must design a sampling plan. This calls
for three decisions:
a. Sampling unit: Whom should we survey? Define the target
population that will be sampled.
b. Sample size: How many people should be surveyed? Large

samples give more reliable results than small samples.
c. Sampling procedure: How should we choose the

respondents? Probability sampling allows the calculation of
confidence limits for sampling error.
Challenges of Sampling: Using Probability Sampling
in China
Probability sampling is difficult to achieve in some countries like
China.
This follows from Chinas large size and the time, cost, and
difficulty of accessing respondents in all parts of the country
due to lack of communication, transportation, and other
infrastructural set-ups.
Regional variations in cultural traditions and the economic
situation present additional problems, particularly as economic
development has been accompanied by increasing diversity
across the country.
The frequent need to obtain authorization from the relevant
authorities when undertaking surveys.
Contact Methods
Mail Once the sampling plan has been

Questionnaire determined, the marketing researcher
must decide how the subject should be
contacted: mail, telephone, personal, or
online interview.
Telephone
Interview
Personal
Interview
Online
Interview
Mail Contacts
The mail questionnaire is one way to reach people who would

not give personal interviews or whose responses might be
biased or distorted by the interviewers.
i. Mail questionnaires require simple and clearly worded

questions.
ii. The response rate is usually low and/or slow.
Telephone Contacts
Telephone interviewing is the best method for gathering information

quickly; the interviewer is also able to clarify questions if
respondents do not understand them.
The response rate is typically higher than in the case of mailed

questionnaires.
The main drawback is that the interviews have to be short and not
too personal.
Telephone interviewing is getting more difficult because of

consumers growing antipathy toward telemarketers calling them in
their homes and interrupting their lives.
Personal Contacts
Personal interviewing is the most versatile method.
The interviewer can ask more questions and record additional

observations about the respondent, such as dress and body
language.
At the same time, personal interviewing is the most

expensive method and requires more administrative planning
and supervision than the other three.
It is also subject to interviewer bias or distortion.
Two Approaches to Personal Interviewing
Personal interviewing takes two forms.
In arranged interviews, respondents are contacted for an

appointment, and often a small payment or incentive is offered.
Intercept interviews involve stopping people at a shopping

mall or busy street corner and requesting an interview.
Intercept interviews can have the drawback of being non-

probability samples, and the interviews must not require too
much time.
Online Contacts
The Internet offers many ways to do research.
A company can embed a questionnaire on its Web site and

offer an incentive to answer it, or it can place a banner on a
frequently visited site such as Yahoo!
Online product testing is also growing and providing

information much faster than traditional new-product
marketing research techniques.
A questionnaire can be embedded on a corporate
Web site to get visitors to participate.
InterContinental Hotel Groups
This hotel chain uses both surveys
and communities to gather data on
customer satisfaction. Online
surveys provide actionable and
speedy results to correct customer
service issues; the online
community provides a sounding
board for more in-depth, longer-
term research objectives.
Some Methods of Online Contacts
Marketers can also host a real-time consumer panel or virtual

focus group or sponsor a chat room, bulletin board, or blog
and introduce questions from time to time.
They can ask customers to brainstorm or have followers of

the company rate an idea on Twitter.
Online communities and networks of customers serve as a

resource for a wide variety of companies.
Advantages of Online Research
1. Online research is inexpensive.
2. Online research is fast.
3. People tend to be honest and thoughtful

online.
4. Online research is versatile.
Disadvantages of Online Research
1. Samples can be small and skewed.
2. Online panels and communities can suffer from excessive

turnover.
3. Online market research can suffer from technological

problems and inconsistencies.
Step 3: Collect the Information
The data collection phase of marketing research is generally the

most expensive and the most prone to error.
Marketers can also host a real-time consumer panel or virtual

focus group or sponsor a chat room, bulletin board, or blog and
introduce questions from time to time.
They can ask customers to brainstorm or have followers of the

company on Twitter rate an idea.
Internationally, one of the biggest obstacles to collecting

information is the need to achieve consistency.
Step 4 : Analyze the Information
The next-to-last step in the process is to extract findings from

the collected data.
The researcher tabulates the data and develops frequency

distributions.
Averages and measures of dispersion are computed for the

major variables.
Step 4 : Analyze the Information
The researcher will also apply some advanced statistical

techniques and decision models in the hope of discovering
additional findings.
Step 5: Present the Findings
The researcher presents findings relevant to the major

marketing decisions facing management.
Step 6: Make the Decision
The managers who commissioned the research need to weigh

the evidence.
Good research should provide clear insights into the research

problem.
See Table 4.2: The Seven Characteristics of Good

Marketing Research
Characteristics of Good Marketing Research
Marketing Decision Support System
Some organizations are using a marketing decision support

system to help marketing mangers make better decisions.
A marketing decision support system (MDSS) is defined

as a coordinated collection of data, systems, tools, and
techniques with supporting software and hardware, by which,
an organization gathers, interprets relevant information from
business and environment, and turns it into a basis for
marketing action.
Overcoming Barriers to the Use of Marketing
Research
In spite of the rapid growth of marketing research, many
companies still fail to use it sufficiently or correctly.
They may not understand what marketing research is capable

of and not provide the researcher the right problem and
information from which to work.
They may also have unrealistic expectations about what

researchers can offer. Failure to use marketing research
properly has led to numerous errors in marketing decisions.
Marketing Research in Asia
Key Challenges
The conduct of marketing research in Asia presents its own

unique set of challenges.
1. Much data on Asian markets particularly less

economically developed countries is non-existent,
unreliable, or very costly to collect.
2. There are also problems with secondary data in the

region either in terms of reliable or currency.
Key Challenges
3. There are also few comparable databases available.
4. The collection of primary data is also saddled with

problems. Survey research suffers from a lack of
sampling lists, few or unqualified interviewers, poor
language translation of questions, respondent
refusals to be interviewed, metric equivalence, or less
than truthful responses.
Problems with Questionnaires
Asians are more prone to yea-

saying.
Hence, having an odd-numbered

scale may lead to more mid-
point responses when customers
do not want to give an
unfavourable response.
Companies may consider using

even-numbered scale in their
Asian questionnaire.
Key Challenges
5. Additionally, researchers should bear in mind the
connotations Asians associate with certain product
features. For example, when asking Asians for their
reactions toward price, many Asians tend to equate
high price with high quality.
6. Researchers must also be aware of the cultural

variations in Asian countries. For example, it may be
decided that the wife be interviewed. However, in
some Muslim countries, men have several wives. Who
is to be interviewed?
Key Challenges
7. In many countries, the researcher cannot send a mailed
questionnaire because of low population literacy or poor
postal service; and telephone interviews are not feasible
where telephone ownership or service is poor. This means
that researchers must rely primarily on personal
interviewing, focus group interviewing, and observational
research.
8. Asian countries also vary in their research capabilities. Hong

Kong, Japan, the Philippines, and Singapore have fairly
advanced research industries; while those in China and
Indonesia are more limited, although improving.
Summing Up Challenges Faced by Companies
Conducting Research in Asia
Thus, companies going abroad face a problem: they need
reliable data because they know little about other countries
cultures, distribution, and economics; yet the data often are
poor for making key decisions.
Researchers should also be attuned to the high rate of change

in the Asian region. Information may thus be out-dated very
quickly.
Marketing research is most useful insofar as it can forecast

patterns of behavior.
Possible Solutions
1. It may be unwise to develop one marketing research study for all of

Asia. Rather, a sequence of piloting, adaptation, and rollout may be
preferable.
2. External validation among data sources is also advised.
3. Standardized question structure, back-translation, and logic checks

of questions may also be useful research strategies. It has also
been recommended that samples be based on future demographic
profiles to account for Asias high rate of change.
4. Finally, as more companies enter Asia, the marketing research

capabilities and infrastructure in the region will improve.
Translation of Questionnaires
Because of Asias varied languages, some questionnaires come

in multiple languages to minimize misunderstanding of what
was surveyed.
Measuring Marketing Productivity
Marketers are facing increased pressure to provide clear,

quantifiable evidence to senior management as to how their
marketing expenditures help the firm to achieve its goals and
financial objectives.
An important task of marketing research is to assess the

efficiency and effectiveness of marketing activities.
Measuring Marketing Productivity
Marketing research can help address this increased need for

accountability.
Two complementary approaches to measure marketing

productivity are:
a. Marketing metrics to assess marketing effects.
b. Marketing-mix modeling to estimate causal relationships and how

marketing activities affects outcomes.
Marketing dashboards are a structured way to disseminate the

insights gleaned from these two approached within an
organization.
Marketing Metrics
Marketing metrics is the set of measures that help firms to

quantify, compare, and interpret their marketing
performance.
Marketing metrics can be used by brand managers to design

marketing programs and by senior management to decide on
financial allocations.
Five Key Questions in Measuring Marketing
Performance
1. Do you routinely research consumer behavior (retention,
acquisition, usage, etc.) and why consumers behave that way
(awareness, satisfaction, perceived quality, etc.)?
2. Are the results of this research routinely reported to the board in a
format integrated with financial marketing metrics?
3. In those reports, are the results compared with the levels
previously forecasted in the business plans?
4. Are they also compared with the levels achieved by your key
competitor using the same indicators?
5. Is short-term performance adjusted according to the change in
your marketing-based asset(s)?
Table 4.3: Sample Marketing Metrics
Marketing Mix Modeling
Marketing-mix models analyze data from a variety of sources,

such as retailer scanner data, company shipment data,
pricing, media, and promotional spending data.
Although marketing-mix modeling helps to isolate effects, it is

less effective at assessing how different marketing elements
work in combination.
Three Main Shortcomings for Marketing Mix
Modeling
1. Marketing-mix modeling focuses on incremental growth
instead of baseline sales or long-term effects.
2. The integration of important metrics such as customer

satisfaction, awareness, and brand equity into marketing-mix
modeling is limited.
3. Marketing-mix modeling generally fails to incorporate metrics

related to competitors, the trade, or the sales force (the
average business spends far more on the sales force and
trade promotion than on advertising or consumer promotion).
Marketing Dashboards
Firms are also employing organizational processes and systems to

make sure they maximize the value of all these different metrics.

Management can assemble a summary set of relevant internal and
external measures in a marketing dashboard for synthesis and
interpretation.
Some companies are also appointing marketing controllers to review

budget items and expenses.
Increasingly, these controllers are using business intelligence

software to create digital versions of marketing dashboards that
aggregate data from disparate internal and external sources.
Marketing DashboardsTwo Key Scorecards
A customer-performance scorecard records how well the

company is doing year after year on such customer-based
measures as those shown in Table 4.4. Management should set
norms for each measure and take action when results get out of
bounds.
A stakeholder-performance scorecard tracks the satisfaction of

various constituencies who have a critical interest in and impact on
the companys performance: employees, suppliers, banks,
distributors, retailers, and stockholders. Again, management should
take action when one or more groups register increased or above-
norm levels of dissatisfaction.
Table 4.4: Sample Customer Performance Scorecard
Measures
Marketing Effectiveness and Efficiency
Example of a Marketing Dashboard
Schema for Chapter Four
Thank you

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Marketing Management:

1. What constitutes good marketing research?

2. What are the best metrics for measuring marketing

3. How can marketers assess their return on investment of

Good marketers need insights to help them interpret past

To make the best possible tactical decisions in the short run

Discovering a consumer insight and understanding its

Marketing managers often commission formal marketing

Marketing insights provide diagnostic information about

Good marketing insights often form the basis of successful

Gaining marketing insights is crucial for marketing success.

We define marketing research as the systematic design,

Most large companies have their own marketing research

Small companies can hire the services of a marketing research

Using the Internet

Checking out rivals

Tapping into partner expertise

1. Syndicated-service research firmsThese firms gather

2. Custom marketing research firmsThese firms are hired to

3. Specialty-line marketing research firmsThese firms provide

Effective marketing research involves six steps:

Some research is exploratoryits goal is to shed light on

Some research is descriptiveit seeks to quantify demand.

Some research is causalits purpose is to test a cause-and-

The second stage of marketing research is where the

To design a research plan, the researcher needs to make

The researcher can gather secondary data, primary data, or

Secondary data are data that were collected for another

Primary data are data freshly gathered for a specific

Fresh data can be gathered

Is a particular observational research approach that uses

The goal is to immerse the researcher into consumers lives to

A focus group is a gathering

Unlike paper-and-pencil surveys, focus-group interviews allow participants

A professional research moderator provides questions and

Moderators try to discern consumers real motivations and

The sessions are typically recorded.

In Asia, some cultural sensitivities may require that focus

Older participants may find it offensive to be in the same

See Marketing Memo: Conducting Informative Focus Groups

Companies undertake surveys

Customers leave traces of their purchasing behavior in store

Much can be learned by analyzing these data.

Actual purchases reflect consumers preferences and often are

People may report preferences for popular brands, and yet

Store-scanner data can

More importantly, they

The most scientifically valid research is experimental

Designed to capture cause-and-effect relationships by

Experiments call for:

Marketing researchers have a choice of three main research

qualitative measures, and

A questionnaire consists of a set of questions presented to

Because of its flexibility, is by far the most common instrument used

Questionnaires need to be carefully developed, tested, and debugged

Some marketers prefer more qualitative methods for gauging

Qualitative research techniques are relatively unstructured

Qualitative research techniques are a creative means of

Because of the freedom it affords both researchers in their

Marketers must temper the in-depth insights that emerge

And different researchers examining the same qualitative

Some other popular qualitative research approaches to get

See Marketing Insight: Getting into Consumers Heads with