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Chapter 02 – Marketing Research: Process and Systems for Decision Making

Chapter 2

Marketing Research: Process and Systems

for Decision Making

High-Level Chapter Outline

I. The Role of Marketing Research

II. The Marketing Research Process

A. Purpose of the Research

B. Plan of the Research

Primary versus Secondary Data

Qualitative versus Quantitative Research

Company versus Contract Research

C. Performance of the Research

D. Processing of Research Data

E. Preparation of the Research Report

F. Limitations of the Research Process

III. Marketing Information Systems

Detailed Chapter Outline

I. The Role of Marketing Research

Marketing research is the process by which information about the environment is

generated, analyzed, and interpreted for use in marketing decision making.

Marketing research does not make decisions, but it can substantially increase the chances

that good decisions are made.

Marketing managers should recognize that:

oEven the most carefully executed research can be fraught with errors

oMarketing research does not forecast with certainty what will happen in the future

oThey should make decisions in light of their own knowledge and experience, since no

marketing research study includes all of the factors that could influence the success

of a strategy

Although marketing research does not make decisions, it can reduce the risk associated

with managing marketing strategies.

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Chapter 02 – Marketing Research: Process and Systems for Decision Making

It is vital for investigating the effects of various marketing strategies after they have been

implemented.

Today, many marketing researchers work hand-in-hand with marketing managers

throughout the research process and have responsibility for making strategic

recommendations based on the research.

II. The Marketing Research Process

Marketing research can be viewed as the systematic process for obtaining information to

aid in decision-making.

There are many types of marketing research.

The five Ps of the research process are (Figure 2.1):

oPurpose of the research

oPlan of the research

oPerformance of the research

oProcessing of research data

oPreparation of research report

A. Purpose of the Research

The first step in the research process is to determine explicitly why the research is

needed and what it is to accomplish.

Quite often a situation or problem is recognized as needing research, yet the nature of

the problem is not clear or well defined nor is the appropriate type of research evident.

Managers and researchers need to discuss and clarify the current situation and develop

a clear understanding of the problem.

Managers and researchers should agree on:

oThe current situation involving the problem to be researched

oThe nature of the problem

oThe specific question or questions the research is designed to investigate

This step is crucial since it influences the type of research to be conducted and the

research design.

B. Plan of the Research

A research plan spells out the nature of the research to be conducted and includes an

explanation of such things as the sample design, measures, and analysis techniques to

be used.

Three critical issues influence the research plan are:

oWhether primary or secondary data are needed

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Chapter 02 – Marketing Research: Process and Systems for Decision Making

oWhether qualitative or quantitative research is needed

oWhether the company will do its own research or contract with a marketing

research specialist

Primary versus Secondary Data

Primary data are the data collected specifically for the research problem under

investigation.

Secondary data are the data that have previously been collected for other purposes

but can be used for the problem at hand.

Secondary information has the advantage of usually being cheaper than primary

data, although it is not always available for strategy- specific research questions.

There are many types of secondary data that could be useful for understanding a

market and for answering a particular research question.

Some of these data can be found from sources internal to the organization such as

sales invoices, quarterly sales reports, and marketing research done by the

organization.

Other secondary data must be obtained from sources external to the organization

and include information such as syndicated data providers and by the government,

such as U.S. census data.

Figure 2.2 lists the common types of information that is available in a secondary

data research.

Qualitative versus Quantitative Research

Qualitative research typically involves face-to-face interviews with respondents

designed to develop a better understanding of what they think and feel concerning

a research topic.

The two most common types of qualitative research are focus group and long

interviews.

oFocus groups typically involve discussions among a small number of

consumers led by an interviewer and are designed to generate insights and

ideas about products and brands.

oLong interviews are conducted by an interviewer with a single respondent

for several hours.

Quantitative research involves more systematic procedures designed to obtain and

analyze numerical data.

There are four common types of quantitative research in marketing are

observation, surveys, experiments, and mathematical modeling.

oObservational research involves watching people and recording relevant

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Chapter 02 – Marketing Research: Process and Systems for Decision Making

facts and behaviors.

oSurvey research involves the collection of data by means of a questionnaire

either by mail, phone, online or in person.

oExperimental research involves manipulating one variable and examining

its impact on other variables.

oMathematical modeling research often involves secondary data. It is useful

because it provides an efficient way to study problems with extremely large

secondary data sets.

Company versus Contract Research

Most large consumer goods companies have marketing research departments that

can perform a variety of types of research.

In addition many marketing research firms, advertising agencies, and consulting

companies do marketing research on a contract basis.

C. Performance of the Research

Performance of the research involves preparing for data collection and actually

collecting them.

In terms of actual data collection, a cardinal rule is to obtain and record the maximal

amount of useful information, subject to the constraints of time, money, and

respondent privacy.

Failure to obtain and record data clearly can obviously lead to a poor research study,

while failure to consider the rights of respondents raises both practical and ethical

problems.

Thus, both the objectives and constraints of data collection must be closely monitored.

D. Processing of Research Data

Processing research data includes the preparation of data for analysis and the actual

analysis of them.

The appropriate analysis techniques for collected data depend on the nature of the

research questions and the design of the research.

Qualitative research data consist of interview records that are content analyzed for

ideas or themes.

Quantitative research data may be analyzed in a variety of ways depending on the

objectives of the research.

A critical part of this stage is interpreting and assessing the research results.

Marketing researchers should always double-check their analysis and avoid

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Chapter 02 – Marketing Research: Process and Systems for Decision Making

overstating the strength of their findings.

E. Preparation of the Research Report

The research report is a complete statement of everything in a research project and

includes a write-up of each of the previous stages as well as the strategic

recommendations from the research.

Figure 2.4 lists the types of questions marketing researchers and managers should

discuss prior to submitting the final research report.

Research reports should be clear and unambiguous with respect to what was done and

what recommendations are made.

Researchers should work closely with managers to ensure that the study and its

limitations are fully understood.

F. Limitations of the Research Process

Many problems and difficulties must be overcome if a research study is to provide

valuable information for decision making.

The major goal of most test marketing is to measure new product sales on a limited

basis where competitive retaliation and other factors are allowed to operate freely.

Problems that could invalidate test marketing study results are listed below.

oTest market areas are not representatives of the market in general in terms of

population, characteristics, competition, and distribution outlets.

oSample size and design are incorrectly formulated because of budget constraints.

oPretest measurements of competitive brand sales are not made or are inaccurate,

limiting the meaningfulness of market share estimates.

oTest scores do not give complete support to the study, such that certain package

sizes may not be carried or prices may not be held constant during the test

period.

oTest-market products are advertised or promoted beyond a profitable level for

the market in general.

oThe effects of factors influence sales, such as the sales force, season, weather

conditions, competitive retaliation, shelf space, and so forth, are ignored in the

research.

oThe test-market period is too short to determine whether the product will be

repurchased by customers.

Careful research planning, coordination, implementation, and control can help reduce

such problems and increase the value of research for decision making.

III. Marketing Information Systems

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Chapter 02 – Marketing Research: Process and Systems for Decision Making

Most marketers use computer-based systems to help them gather, sort, store, and distribute

information for marketing decisions.

A popular form of marketing information system is the marketing decision support system,

which is a coordinated collection of data, tools, and techniques involving both computer

hardware and software by which marketers gather and interpret relevant information for

decision making.

These systems require three types of software:

oDatabase management software for sorting and retrieving data from external and

internal sources.

oModel base management software for manipulating data in ways that are useful for

marketing decision making.

oA dialog system that permits marketers to explore data base and use models to

produce information to address their decision-making needs.

Marketing decision support systems are designed to handle information from both internal

and external sources.

External information is gathered from outside the organization and concerns changes in the

environment that could influence marketing strategies.

KEY TERMS

Experimental research: Experimental research involves manipulating one variable and

examining its impact on other variables.

Focus groups: A type of qualitative research that typically involves discussions among a small

number of consumers led by an interviewer and designed to generate insights and ideas about

products and brands.

Long interviews: A type of qualitative research conducted by an interviewer with a single

respondent for several hours and designed to find out such things as the meanings various

products and brands have for the person or how a product influences the person’s life.

Marketing research: Marketing research is the process by which information about the

environment is generated, analyzed, and interpreted for use in marketing decision making. Most

often consumers or organizational buyers are the subject of the research.

Mathematical modeling: Mathematical modeling involves developing equations to model

relationships among variables to investigate the impact of various strategies and tactics on sales

and brand choices.

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Chapter 02 – Marketing Research: Process and Systems for Decision Making

Observational research: Observational research involves watching people and recording

relevant facts and behaviors.

Primary data: Primary data are data collected specifically for the research problem under

investigation.

Qualitative research: Qualitative research typically involves face-to-face interviews with

respondents designed to develop a better understanding of what they think and feel concerning a

research topic, such as a brand name, a product, a package, or an advertisement.

Quantitative research: Quantitative research involves more systematic procedures designed to

obtain and analyze numerical data.

Secondary data: Secondary data are those that have previously been collected for other

purposes but can be used for the problem at hand.

Survey research: Survey research involves the collection of data by means of a questionnaire

either by mail, phone, or in person.

Test marketing: The major goal of most test marketing is to measure new product sales on a

limited basis where competitive retaliation and other factors are allowed to operate freely. In this

way, future sales potential can often be estimated reasonably well.

ADDITIONAL RESOURCES

Burns, Alvin C. and Ronald Bush. Marketing Research, 7th ed. Upper Saddle River, NJ:

Prentice-Hall, 2014.

Churchill, Gilbert A., Jr.; Tom J. Brown; and Tracy A. Suter. Basic Marketing Research. 8th ed.

Mason, OH: Thomson South-Western, 2014.

Hair, Joseph F., Jr., Robert P. Bush, and David J. Ortinau. Marketing Research. 4th ed. Burr

Ridge, IL: McGraw Hill/Irwin, 2009.

Iacobucci Dawn, and Gilbert A. Churchill, Jr. Marketing Research: Methodological

Foundations. 10th ed. Mason, OH: Thomson South-Western, 2010.

Molhatra, Naresh K. Marketing Research. 6th ed. Upper Saddle River, NJ: Pearson Education,

2010.

Zikmund William G., and Barry J. Babin. Essentials of Marketing Research. 5th ed. Mason, OH:

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Chapter 02 – Marketing Research: Process and Systems for Decision Making

Thomson South-Western, 2013.

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