Unit v – Marketing Research

some basic questions ..

• What kind of business should I do?
• What is the demand for my business?
• Who are my customers?
• What are the market forces that will affect my
business?
• Where should I locate my business?
• How much profit can I get at different
locations and times?
• Who are my competitors and what kind of
product, price and service they offer?
• How I differentiate my business from my
competitors?
• What types of service do my customer prefer?
• What types of advertising attract my
customers?
• What is the market price and how I can
change my price accordingly?
 Marketing research
• The process of
planning, collecting,
and analyzing data
relevant to a marketing
• decision.

• The systematic design, collection,

analysis and reporting of data and
findings relevant to a specific marketing
situation facing the organisation
• Market Research Researching the immediate competitive
environment of the marketplace, including
customers, competitors, suppliers,
distributors and retailers
• Marketing Research Includes all the above plus: - companies
and their strategies for products and
markets - the wider environment within
which the firm operates (e.g. political,
social, etc)
 Marketing Research ...
• How to collect certain information about your
customers, market and competitors.
• This information tells you about your potential
market, prices, trends, competition, target
customer, its preferences, income, habits,
accessibility, convenient time and plans.
• This information should be accurate, and
reliable to help you make the right business
decision.
 Marketing Research

The critical task of the Marketing

Manager is DECISION MAKING.
Marketing Research helps provide
good information to help in decision
making.
 Marketing Research
The information gathered during
Marketing Research can help:
• develop sales forecasts
• design new products, based on customer opinion
• create attractive packaging

• guide advertising plans

 Reason to use MR
• Improve the quality of decision making
• Trace problems
• Focus on keeping existing
customers
• Understand the ever-changing
marketplace
 Advantages of Market Research
– Helps focus attention on objectives
– Aids forecasting, planning and strategic development
– May help to reduce risk of new product development
– Communicates image, vision, etc.
Disadvantages of Market Research
– Information only as good as the methodology used
– Can be inaccurate or unreliable
– Results may not be what the business wants to hear!
– May stifle initiative and ‘gut feeling’
– Always a problem that we may never know enough to be
sure!
 Research
“The quality of marketing planning decision
depends on the quality of the information on
which they are based”

Garbage In = Garbage Out

good market info = good marketing planning
good market info = good marketing planning

There are many sources of Market Info

•customer complaints
•sales-force reports
•government statistics
•industry reports … and ...
 Define
problem
Plan /
design
Follow up
primary
data
Steps in
research
Prepare
process Specify
present sampling
report procedure

Collect
Analyze data
data
 Stage 3
Hypothesis
“A tentative explanation about the
relationship between variables as a
starting point for further testing.”

The way of thinking about how something works -

and using your original “guess” as a starting point
for further investigation
 Collecting Data
The Data Collection Instrument
or, … “getting the info”
“Most of the work in Data Collection depends
on the use of a good questionnaire”
• has to ask questions referring to specific
objectives
• should be pre-tested, if it is new, so you can
make any changes to the questions
 Collecting Data Stage 5

Primary Data
Data being collected for the first time.

Secondary Data

Previously produced or published matter.

 Collecting Data
Primary Data
Data being collected for the first time.
1. Observation
2. Survey
• Telephone
• Mail
• Personal Interview
3. Controlled Experiment
 Collecting Data
Primary Data
Data being collected for the first time.
1. Observation
• overt - watching how customers shop, what they look at, the features
they like, counting cars

• covert (technical eg. Hidden camera)

 Collecting Data
Primary Data
Data being collected for the first time.
2. Survey
• Telephone - inexpensive and fast
- they are the majority of primary marketing research used by big
marketing research companies
• Mail - costs less, and more detailed questions can be asked, can
be used in geographic segments
• Personal Interview - the best method, but most expensive
 Collecting Data
Primary Data
Data being collected for the first time.
3. Controlled Experiment
- not used very often due to costs, but sometimes done by people who
need to answer difficult questions
- the most common method is test marketing a target market segment,
then look at the results and see what works, and what didn’t work
 Collecting Data
Advantages of Secondary Data

1. less expensive
2. less time
SAMPLING TECHNIQUES ..
 Sampling techniques
• Whole population-census method
• Probability sampling
• Non-probability sampling
 Sampling Methods

Probability Nonprobability
sampling sampling
 Types of Sampling Methods
Probability Non- probability
• Simple random • Convenience sampling
sampling • Judgment sampling
• Systematic random • Quota sampling
sampling
• Stratified random
sampling
• Cluster sampling
Sampling Techniques
Census
• if the total group is contacted, the results are known as a census
Sampling Techniques
Probability Sample
• a sample in which every member of the population has a known
chance of being selected
Sampling Techniques
Nonprobability Sample
• a sample chosen in an arbitrary way so that each member of the
population does not have a representative chance to be selected.
Sampling Techniques
Convenience sampling attempts to obtain a sample
of convenient elements. Often, respondents are
selected because they happen to be in the right place
at the right time.
use of students, and members of social
organizations
mall intercept interviews without qualifying the
respondents
department stores using charge account lists
“people on the street” interviews
•a sample chosen according to the convenience of the researcher.
•eg. “sun TV on the street interviews”
Sampling Techniques
Judgmental sampling is a form of convenience
sampling in which the population elements are selected
based on the judgment of the researcher.

•test markets
•purchase engineers selected in industrial marketing
research
•expert witnesses used in court
•eg. “CityTV on the street interviews” of people that DO NOT have
political party affiliation - to determine how they voted, and who would
win the election
Sampling Techniques

Quota Sample
In quota sampling, the population is first segmented into mutually
exclusive sub-groups, . Then judgment is used to select the subjects
or units from each segment based on a specified proportion
Probability sampling
Sampling Techniques
Cluster Sample
• a probability sample that is used in groups
• used when it is difficult to ask everybody, so they pick some areas
and ask everybody in that area (cluster)
Sampling Techniques
Simple Random Sample

• a probability sample in which everybody has an equal opportunity of

being selected.
•Each element in the population has an equal probability of selection AND
each combination of elements has an equal probability of selection
• Names drawn out of a hat
• Random numbers to select elements from an ordered list.
• Each element in the population has a known and equal probability of
selection.
•Each possible sample of a given size (n) has a known and equal probability
of being the sample actually selected.
•This implies that every element is selected independently of every other
element.
Sampling Techniques
Systematic Sample
• every 5th, or every “n”th person is selected. An example is market
research people who call every 10th person in the phone book to get
an opinion.
•The sample is chosen by selecting a random starting point and then
picking every ith element in succession from the sampling frame.
•The sampling interval, i, is determined by dividing the population size N
by the sample size n and rounding to the nearest integer.
• When the ordering of the elements is related to the characteristic of
interest, systematic sampling increases the representativeness of the
sample.
•If the ordering of the elements produces a cyclical pattern, systematic
sampling may decrease the representativeness of the sample.
For example, there are 100,000
elements in the population and a sample of 1,000 is desired. In this case
the sampling interval, i, is 100. A random number between 1 and 100 is
selected. If, for example, this number is 23, the sample consists of
elements 23, 123, 223, 323, 423, 523, and so on.
 Stratified sampling
• A two-step process in which the population is
partitioned into subpopulations, or strata.
• The strata should be mutually exclusive and
collectively exhaustive in that every population
element should be assigned to one and only one
stratum and no population elements should be
omitted.
• Next, elements are selected from each stratum by
a random procedure, usually SRS.
• A major objective of stratified sampling is to
increase precision without increasing cost.
Marketing Control
 Marketing control
• There r 4 types of marketing control is there.
• Annual plan control
• Profitability control
• Efficiency control
• Strategic control
 ANNUAL PLAN CONTROL
• is to ensues that the company achieves the
sales, profit and other goals established in its
annual plan
• The heart of annual plan control is
management by objectives
Management by objectives
 Annual plan control
• Managers use various tools to check on plan
performance
• sales analysis,
• market share analysis ,
• marketing expense to share analysis
• customer attitude tracking
• Sales Analysis: It measures & evluates actual sales in
relationship to sales goals.
• Market share Analysis:. If the company ‘s market share
goes up. The company is gaining on competitors; if it goes
down, the company is losing relative to competitors.
• Marketing Expense to Sales Analysis: the company is not
overspending to achieve its sales goals..
• 1) sales force to sales
• 2) Advertising to sales
• 3) marketing research to sales
• 4)sales administration to sales.
• 5)Distribution and sales promotion to sales
• D) Customer Satisfaction: tracking alert
consumer set up systems to monitor the
attitude and satisfaction of customers,
• The main customer satisfaction tracking
system are:-
• 1.complaint and suggestion system
• 2.customer panel
• 3.customer surveys
 PROFITABILITY CONTROL

• Besides annual-plan control companies need

to measure the profitability of their various
products, territories, customer groups, trade
channels and orders sizes.
• This information will help management
determine whether any products of marketing
activities should be expanded, reduced or
eliminated.
 Efficiency control
• A profiability analysis reveals the company is
earning profits in certain products , territories,
or markets.
• The purpose is to check the efficiency of the
marketing department
Checking-------
• Sales force efficiency
• Advertising efficiency
• Sales promotion efficiency
 Strategic Control
• Organisations should examine critically their
policies, objectives, marketing strategy, and
competitive advantage and growth
opportunities regularly so that their direction
and growth and overall marketing
effectiveness is not impaired or reduced.
• The scanning of marketing environment has
become much more relevant and significant in
view of uncertain’ economic conditions, fast
changing technology, customer life-style,
demographic changes etc.
 Marketing Audit ..
• It is a comprehensive , systematic ,
independent & periodic examination of a
company’s or business unit’s marketing
environment ,objectives , strategies &
activities , with a view to determining
problem areas & opportunities &
recommending a plan of action to improve the
company ‘s marketing performance .