Online Behavioral and Social Tracking and Targeting
Increasingly, online researchers are listening to and watching consumers by actively mining the
rich veins of unsolicited, unstructured, “bottom-up” customer information already available on
the Internet.
Use Marketing at Work 4.1 here.
Behavioral targeting is the practice of marketers using online data to target ads and offers to
specific consumers.
Sampling Plan
A sample is a segment of the population selected for marketing research to represent the
population as a whole.
Use Key Term Sample here.
Designing the sample requires three decisions.
1. Who is to be surveyed (what sampling unit)?
2. How many people should be surveyed (what sample size)?
3. How should the people in the sample be chosen (what sampling procedure)?
Table 4.3 describes different kinds of samples.
Use Table 4.3 here.
The two types of samples are:
probability samples and
nonprobability samples.
Research Instruments
The questionnaire is the most common data collection instrument.
Closed-end questions include all the possible answers, and subjects make choices among them.
Open-end questions allow respondents to answer in their own words.
Care should be given to the wording and ordering of questions.
Researchers also use mechanical instruments to monitor consumer behavior. Checkout scanners
are an example.
3. Implementing the Research Plan
This stage involves collecting, processing, and analyzing the information.
Researchers must process and analyze the collected data to isolate important information and
findings.
4. Interpreting and Reporting the Findings
Researchers should present important findings and insights that are useful in the major decisions
faced by management.
Use Critical Thinking Exercise 4-8 here.
Use Linking the Concepts here.
ANALYZING AND USING MARKETING INFORMATION
Customer Relationship Management (CRM)
Companies capture information at every possible customer touch point.
Customer relationship management (CRM) is used to manage detailed information about
individual customers and carefully manage customer touch points in order to maximize customer
loyalty.
Use Chapter Objective 4 here.
Use Key Term Customer Relationship Management (CRM) here.
CRM integrates everything that a company knows about individual customers to provide a
360-degree view of the customer relationship.
Big Data and Marketing Analytics
Today’s big data can yield big results. But simply collecting and storing huge amounts of data
has little value. Marketers must sift through the mountains of data to mine the gems—the bits
that yield customer insights.
As one marketing executive puts it, “It’s actually [about getting] big insights from big data. It’s
throwing away 99.999 percent of that data to find things that are actionable.”
Says another data expert, “right data trumps big data.” That’s the job of marketing analytics.
Marketing analytics consists of the analysis tools, technologies, and
processes by which marketers dig out meaningful patterns in big data to gain
customer insights and gauge marketing performance.
The most common mistake is to view CRM and marketing analytics as
technology processes only.
Use Online, Mobile, and Social Media Marketing here.
Use Marketing at Work 4.2 here.
Use Key Term Marketing Analytics here.
Use Discussion Question 4-5 here.
Distributing and Using Marketing Information
The marketing information system must make the information available to managers and others
who make marketing decisions or deal with customers.
Many companies use an intranet to facilitate information distribution. The intranet provides
ready access to data, stored reports, and so forth.
Companies are increasingly allowing key customers and value-network members to access
account and product information, along with other information. The systems that do this are
called extranets.
Use Linking the Concepts 2 here.
Use Chapter Objective 4 here.
OTHER MARKETING INFORMATION CONSIDERATIONS
Marketing Research in Small Businesses and Nonprofit Organizations
Managers of small businesses and nonprofit organizations can obtain marketing insights by
observing things around them.
Managers can conduct informal surveys using small convenience samples.
Small businesses can collect a considerable amount of information at very little cost online.
International Marketing Research
International marketing researchers follow the same steps as domestic researchers.
The international researcher may have a difficult time finding good secondary data.
International researchers often must collect their own primary data.
Reaching respondents is often not easy in other parts of the world.
Cultural differences from country to country cause additional problems for international
researchers.
Language is the most obvious obstacle.
Even when respondents are willing to respond, they may not be able to because of high
functional illiteracy rates.
Use Chapter Objective 5 here.
Public Policy and Ethics in Marketing Research
Intrusions on Consumer Privacy
Many consumers strongly resent or even mistrust marketing research.
Increasing consumer resentment has led to lower survey response rates in recent years.
The best approach is for researchers to ask only for the information they need, to use it
responsibly to provide customer value, and to avoid sharing information without the customer’s
permission.
Misuse of Research Findings
Many research studies appear to be little more than vehicles for pitching the sponsor’s products.
Several associations have developed codes of research ethics and standards of conduct.
Video Case: Nielsen
Most people know Nielsen as the TV ratings company. In reality, however,
Nielsen is a multiplatform market research company that has constantly
been evolving since 1923. Its goal is to measure and track a wide range of
consumer activity in order to establish a 360-degree view of individuals and
market segments. To accomplish this, Nielsen has to follow consumers
wherever they may be—watching TV, online, in their homes, or in stores.
How does Nielsen track all this activity? The veteran research firm has
established e.ective methods of recording consumer activity, from retail
scanner data to household panels to monitoring social networks. As data are
captured, they are transferred to a Nielsen data warehouse, where they are
matched to the right individual and added to the terabytes of information
Nielsen already possesses. Through data sorting and analytics, Nielsen cuts
through billions of daily transactions to deliver clear consumer insights to
clients.
After viewing the video featuring Nielsen, answer the following questions:
4-15. What is Nielsen’s expertise?
4-16. Providing a real-world example, describe how Nielsen might discover a
consumer insight.
4-17. What kinds of partnerships might Nielsen need to form with other
companies in order to accomplish its goals?
Company Cases
See Appendix 1 for cases appropriate for this chapter.
Case 4, Campbell’s: Watching What You Eat. The pillar of product
development at Campbell’s is deep dive research—-eld research where
observations lead to consumer insight.
Case 8, 3M: Where Innovation Is a Way of Life. Few companies provide
more support for research-based product development than 3M.
Case 14, Alibaba: The World’s Largest E-Tailer Is Not Amazon. The
largest customer base provides ecommerce giant with the largest database
and endless possibilities.</CS1>
MyMarketingLab If assigned by your instructor, complete these writing
sections from your Assignments in the MyLab.
4-18. What is neuromarketing and how is it useful in marketing research?
Why is this research approach usually combined with other approaches?
(AACSB: Communication)
4-19. Describe an example in which marketing research could cause harm to
participants. Many companies have a review process similar to that required
for following the government’s “Common Rule.” Write a brief report
explaining this rule and how you would apply it to your example. (AACSB:
Written and Oral Communication; ReGective Thinking)
GREAT IDEAS
Barriers to effective Learning
1. While today’s students have grown up with computers, the idea of an
“information system” may be very new to them. They typically will not have
had to do any research, and any jobs they’ve held to this point in their lives
will most likely have entailed very basic, entry-level type work. To get them
past this, you could talk about the type of information the university will hold
on each student—their major, the courses they’ve taken, the grades they’ve
earned, their current address, their home address, their parents’ names,
whether they are paying full tuition or are on any kind of scholarship, what
high school they attended and their grade point average there, what sports
they play or activities they participate in, and so forth. Then talk about how
the university might use that information to understand their current student
population to figure out how to target future students while they are still in
high school. This should help them grasp how data gets turned into
information, and from that point to knowledge.
2. Virtually no one in class will be at all familiar with the market research
process. They have not had to worry about collecting information in any
large-scale process, although they might have been involved with collecting
information from members of a student organization as to what activities the
members would like to participate in. One e.ective way of discussing this
issue is to talk about the course evaluations that are completed at the end of
the semester. Explaining that this is not to rate the instructors but to provide
valuable feedback to the university, the department, and the instructor on
course o.erings, content within the courses, and only lastly to get an idea of
the competence of instructors should help. Also, give examples of poorly
designed surveys, and show how they lead the respondent to answer in a
given way. Especially helpful are questionnaires that use leading or loaded
questions or double-barreled questions that are diKcult to answer.
3. A final barrier is the lack of understanding of commercial and/or online
databases. Showing a database in class, such as the U.S. Census data or
state information, both of which are available for free, will help them see the
amount of data that is available. If possible, it would then be helpful to “-nd
the story” in the data—that is, to apply the data to a small problem, such as
where to locate a new Starbucks outlet. Using the data to show population
clusters of mid- to upper-level income areas—the kind of consumer most
likely to pay a premium for co.ee—will help them internalize the power of
using e.ective and relevant data in marketing decision making.
Student Projects
1. Imagine some situations where your school might make good use of
exploratory research and/or descriptive research. Explain.
2. Secondary data consists of information that already exists, having been
collected for another purpose. What are some secondary data sources you
might take a look at if you were helping your school develop a recruitment
strategy?
3. Observational research involves gathering primary data by observing
people. Do you see any potential ethical conGicts with its use?
4. Why would you want to (or not want to) use a mail questionnaire to reach
Generation Y individuals? Give both pros and cons.
5. Focus group interviewing can be a most e.ective interview technique.
Under what situations does it make sense to use this technique?
Small Group Assignment
Form students into groups of three to -ve. Each group should read the
opening vignette to the chapter on LEGO Group. Each group should answer
the following questions:
1. What was the cause of LEGO losing favor with American kids?
2. What forms of research did LEGO Group undertake to determine the cause
of their problem?
3. Although they are once again wildly popular with children (and some
adults), do you see any problems that could potentially derail this
popularity?
Each group should then share its finding with the class.
Individual Assignment
Construct two simple (5 question) surveys that examine student’s attitudes
toward your school. One survey should contain open-end questions only and
the other only closed-end questions. Be careful of your wording. Which of the
two surveys do you believe would provide the greatest depth of information?
Why?
Think-Pair-Share
Consider the following questions, formulate answers, pair with the student on
your right, share your thoughts with one another, and respond to questions
from the instructor.
1. What are the four steps of the marketing research process?
2. What are the di.erences between causal, exploratory, and descriptive
research methods?
3. Why does it make sense to use secondary data before you turn to primary
data?
4. What are some of the more substantial drawbacks of observational
research?
5. The Internet is well suited for the collection of quantitative research. Why
is not too good for qualitative research?
Classroom Exercise/Homework Assignment
Using observational research, gather data on your roommate’s eating habits. What do your
findings tell you? More importantly, what do your findings NOT tell you about his/her eating
habits?
Classroom Management Strategies
This chapter will be a first introduction into managing any kind of information
for most students. It is also a very brief introduction to marketing research.
Figure 4-1 should figure prominently in the discussion about this chapter so
that students don’t lose track of all the varying sources of information
marketers need.
1. Only 5 minutes should be spent on Assessing Marketing Information
Needs. This is an introductory segment, and it also represents a
topic that is necessarily company-driven rather than generic.
2. The majority of the class, probably 40 minutes, should be spent on
Developing Marketing Information. This is the meat of the chapter,
and it not only covers information sources such as internal data and
marketing intelligence, but it also goes into some detail on
performing marketing research. Most of the key terms from
marketing research are defined and explained in this section.
3. The time remaining can be used to cover the last three sections of
this chapter: Analyzing Marketing Information; Distributing and
Using Marketing Information; and Other Marketing Information
Considerations. Customer Relationship Management is covered in
the first of these sections. Of the topics listed here, that will be the
most important for students to comprehend.
PROFESSORS ON THE GO
Managing Marketing Information to Gain Customer Insight
Key Concepts
Where to get marketing information
Marketing research
Assume that you are a regional marketing manager for a cellular phone company. List
at least three potential sources of internal data and discuss how these data would help
you create cellular services that provide greater customer value and satisfaction.
In this chapter we define primary data and secondary data. Once secondary data, such
as customer usage, is gathered and analyzed with the express purpose of making a
pricing decision, is it still called secondary data or is it primary data?
Imagine you are an owner of a small children’s clothing store that specializes in
upscale girl’s fashion from size 2 to 6. You have found a potential clothing line, but
you are unsure whether or not the line will generate the sales needed to be profitable.
Which type of research methodology (exploratory, descriptive, or causal) is best
suited to solve your research objective. Why?
Discuss why you would use a focus group to gather information, rather than
interviewing the same people individually.
Key Concepts
Analyzing marketing information and customer relationship marketing
Marketing research for small businesses and nonprofits
Ethics in marketing research
Small businesses and nonprofit organizations often lack the resources to conduct
extensive market research. Assume that you are the director of fundraising for a small
nonprofit that is focused on a social issue. List three ways, using limited resources,
that you could gather information about your primary donor group.
Find an example of a company that you believe uses customer relationship
management. Describe the process. Outline the “connections” created with customers,
suppliers, and publics.
Talk to students on campus from other countries about the uses of market research in
their countries. Is there a focus on market research there? How is it conducted? Are
there any taboos or social norms that need to be taken into consideration? Compare
answers in class from the different countries represented.
What do you think is the greatest problem today with respect to ethical business
practices on the Internet? What solution would you offer?