Chapter # 15

Marketing
Research
By: Abdul Jaleel Mahesar
 Outline
What is marketing research?
The scope of marketing research
The purpose of marketing research
Qualitative and Quantitative research
The research process
Techniques of field research
Sampling in marketing research
Sampling and non-sampling error
 What is Marketing Research?
Marketing Research
The systematic and the objective collection analysis and
evaluation of information relate to marketing and markets.
Market Research
Concerns the demands for the product (or service) in
terms of both its extent and the nature of the demand
(that is what type of people buy the product).
 The Scope of Marketing
Research
The marketing research can be divided into the following elements.
Market Research
Size of the market.
Geography of the market.
Customer profile.
Future potential market
Customer behavior.
Market segments.
Elements of Marketing Research
Product Research
Evaluation of strengths and weaknesses of existing products.
Investigation of new uses for existing products.
Product variations.
Packaging research.
Sales potential of new products.
Product development.
Research into pricing policies.
Elements of Marketing Research
Sales Research
Examination of selling activities by outlet, territory, agencies.
Evaluation of sales methods.
Measurement of the effectiveness of salespeople.
Planning of sales calls.
Analysis of distribution systems.
Identification of suitable outlets.
Elements of Marketing Research
Promotion Research
Analysis of the effectiveness of promotional activities.
Media research.
Copy research, formulation of advertising themes.
Business Economics
Research into the macro- and microeconomic
environment.
Elements of Marketing Research
Export Marketing Research
Application of domestic marketing research to foreign markets.
Motivation Research
Analysis of motives that condition customer responses.
Customer perception of value.
Competitor Research
Research into the activities of competitors
Market shares, trends, identification of unique selling price.
 The Purpose of Marketing
Research
Marketing research can be seen as risk-reducing activity.
Risks cannot be eliminated completely as they are inherent in a
dynamic market.
However, by intelligence gathering analysis and evaluation, it is
possible to devise strategies that increase the profitability of
success.
Sound marketing research will aid the development of successful
new products and the most effective way to market them.
Understanding what motives the customer to purchase can play a
major role in developing the product and devising the advertising
campaign.
 Qualitative Research and
Quantitative Research
Qualitative Research
It is in-depth research into the motivation behind
consumer behavior or attitudes. Consequently, it provides
information on consumers tastes, preferences, attitudes
and buying habits and although this is inevitably
subjective, it provides insights into consumer behavior to
complement the quantitative data
Qualitative research is conducted by the psychologists
working with the small groups of people within the target
market for the product.
 Qualitative Research and
Quantitative Research
Quantitative Research
Concentrates on factual information such as market share,
probable level of sales at given price and ways in which the
market can be segmented.
Quantitative research relates to who buys the product and how
much will they buy, whereas qualitative research is concerned
more with why people buy.
Techniques of quantitative research includes surveys (delivered
face to face, by post and by telephone).
 The Research Process
1. Definition of the Problem
. Before launching a research project, it is necessary to
clarify the type of information required, why it is required
and what questions it is designed to answer.
 1. Definition of the Problem
Internal
Secondary Data
External
Marketing
Reserach Data
Observational
(Brhavior)
Primary Data
Questionnaire
(asking people)
Types of Marketing Information
 2. Investigation of Secondary
Sources of Data
In fact, before a business collects primary data by undertaking
expensive field research, it should review secondary data
collected by means of desk research.
Primary Data
It is defined as data that originates as a result of that particular
investigation.
Secondary Data
Data involve the use and further analysis of data collected for
another purpose and found by means of desk research.
 3. Selection of Primary Data
Collection Methods
There are three basic techniques of field research to
collect primary data:
Surveys
Observation
Experiments
Each technique can be conducted in a variety of ways, to which
reference will be made later. The task for the researcher is to choose
the most appropriate method.
 4. Decide on Details of Research
Techniques
Included in this stage would be the formulation of
questionnaire and deciding on sampling methods.
 5. Analysis, Interpretation &
Evaluation of the data
After collecting the data, it is necessary to draw
conclusions from it that can be of value in designing
marketing strategies.
The analysis, Interpretation and evaluation of results
require an understanding of statistical theory.
Particular reference should be made to techniques that
test the significance of the findings.
 6. Recommendations for Action
The final part of research project consists of
recommending the strategy to be pursued in relation to
the product and the marketing effort.
Marketing research is not pure research undertaken for
its own sake.
It is designed to provide answers to commercially
important marketing questions.
 Techniques of Field Research
The collection of original data by means of surveys, experiments or
observations.
Primary data can be collected by means of three techniques of field
research:
1. Observations
. Market researchers can observe how people behave.
. The great advantage of this technique is that it avoids the subjective
element that is present when people are questioned.
. Observation is an expensive technique of the market research and
provides only limited information.
 Techniques of Field Research
2. Experiments
. Experiments are used to test and assess the response of
consumers to change in the marketing mix.
. This might involve changes in the product or packaging,
advertising, price and distribution arrangements.
Test Marketing
It has the advantage of reducing marketing costs and targeting a
particular area before the firm is committed to a national launch.
 Techniques of Field Research
3. Focus Groups
. This involves a group discussion in which people are encouraged
to freely express views and opinions on a selected subject.
4. Surveys
. Most marketing investigations use some form of survey of
customers opinions.
. The advantage of survey (over the two previous methods) is that it
is flexible, yields a wide range of data and generates information
on customers opinions.
 Techniques of Field Research
Surveys can be delivered in a number of ways:
Personal interviewing;
Postal survey;
Telephone survey;
Panel survey, in which the opinions and behavior of
representative group of people is obtained;
Group interviews to encourage free discussion and
provide a psychological insight into consumer motivation.
 Techniques of Field Research
5. Questionnaire Design
. Questionnaires are likely to play a key role in most market
research surveys.
. The types of questions posed vary from highly structured
questions, designed to attract limited range of responses
(closed questions).
. To unstructured questions, to which respondents are
invited to answer more freely (close questions).
 Techniques of Field Research
In designing a questionnaire it is important to follow these principles:
Clarify the purpose of the enquiry;
Devise clear, unambiguous questions;
Avoid leading questions;
Follow a logical sequence in questions;
Avoid questions that tax the memory too much
Do not use multiple choice questions where one of the offered
answers appears to confer some status on respondents;
 Techniques of Field Research
Avoid questions on topics that respondents will be
reluctant to answer;
Confine questions to the personal experiences of
respondents;
Introduce some control questions.
 Question Types
The main forms of open questions are:
Completely unstructured: what is your opinion of ford cars?
Word Association: what is the first word comes in your mind
when you think of ford cars?
Sentence Completion: the main factor I take into account
when buying a new car is_____.
Story Completion: an incomplete story is presented and
respondents are asked to complete it;
 Question Types
Picture completion: an example would be when
respondents are presented with a picture containing two
people, one complete and one with an empty speech
bubble, and they are then asked to fill in the empty
bubble;
Thematic appreciation test: picture is presented, for
example, and respondents are asked to make up a story
about what they think is happening or may happen in the
picture.
Dichotomous: yes/no questions where there are only two
possible answers.
 Question Types
Multiple choice: questions with three or more possible
answers, for which the chosen response is indicated by a
ticket box;
Likert scale: a statement is written out and the
respondent shows the degree of their
agreement/disagreement on a five-category scale running
from strongly agree to strongly disagree.
Semantic difference: here, a scale connects two
opposing words (large/small, modern/old-fashioned) and
the respondent selects the point that represents his/her
opinions.
 Question Types
Importance scale: a scale that rates the importance of
something from extremely important through very
important, somewhat important and not very important
to not important at all follows each question.
Rating Scale: a scale is used on which respondents rate
some attribute (quality of service) from excellent too
poor.
Intention to buy: a scale can be used that describes the
respondents intention from definitely buy through
probably by, not sure and probably not buy to
definitely not buy.
Sampling in Marketing Research
A survey consist of the whole population is known as a
census.
This is defined as a survey involving less than the whole
population and it has advantages (over a full census) in
that it:
Reduces costs;
Saves on time;
Requires fewer resources;
Is more reliable as there is a concentration on fewer units.
 Probability Sampling
Sample Survey: a survey is based on a portion of the population.
This contrasts with a census, which is the survey of whole population.
we can divide sampling methods into two broad types: probability (or
random) sampling and non-probability (or non-random sampling).
Probability Sampling: probability samples are so constructed that
every member of the population has a known probability (or chance)
of selection. As the name suggests, this method of sampling lends
itself to statistical analysis involving the determination of sampling
error expressed in mathematical terms.
 Probability Sampling
Here are the main techniques of probability sampling.
Simple random sample: this is a sample in which each
person or unit has an equal chance of being selected.
Systematic sample: this involves choosing a starting point in
a sample frame and then selecting every nth item thereafter.
Stratified sample: with this method, the population is divided
into subgroups and the sample reflects each subgroup in
proportion to their representation in the population as a whole.
 Non-Probability Sampling
In non-probability sampling methods individuals are
selected on the basis of one or more criteria determined
by the research.
The main techniques of non-probability sampling are as
follows, which is the best of the probability and non-
probability methods for particular kinds of population
being surveyed.
Cluster Sample: this involves making a random selection
from a frame listing not individuals, but groups of
individuals.
 Non-Probability Sampling
Quota sample: like a stratified sample, this method
involves dividing the population into subsets which quotas
attached that reflect accurately known population
characteristics in a variety of respects (age and sex
distribution, income, occupation and so on).
Multi-Stage sample: this consists of a series of samples
taken at successive stages, such as a region, then a town,
then a suburb, then a street.
Sampling & Non-sampling Error
The value of marketing research is dependent on the results from a
sample reflecting the population as a whole. The total survey error
is made up of two elements:
Non-sampling Error: this is the extent to which the mean
observed value for the respondent of a particular sample disagrees
with the mean true value for the particular sample of respondents,
and the size of the non-sampling error depends on:
Non-response error: differential response rates among various groups;
Response errors: such as giving an answer to please the researcher, giving a
socially acceptable answer or error caused by lack of knowledge of the
subject matter;
 Non-sampling Error
Sampling error: this is the difference between the estimate of a
value obtained from a sample and the actual value, so, for
example if a sample shows that the average yearly purchase of a
product is 30 per person, when in fact it is 32, then the sampling
error is 2.
 Sample size and confidence
limits
Statistical theory enables market researchers to express
statistically the confidence that they have in their findings.
This is based on the properties of a normal distribution in
which:
68% of values lie within one standard deviation of the mean;
95% of values lie within two standard deviations of the mean;
99% of values lie within three standard deviations.
The End