Chapter Three: The Marketing Research Process
Chapter 3
The Marketing Research Process
AT-A-GLANCE
I. Introduction
II. Decision Making and Marketing Research
A. Certainty
B. Ambiguity
C. Classifying decision situations
III. Types of Marketing Research
A. Exploratory research design
2. Exploratory research and problem solving
B. Descriptive research
C. Causal research
1. Causality
2. Degrees of causality
3. Experiments
D. Uncertainty influences the type of research
IV. Stages in the Research Process
A. Alternatives in the research process
B. Defining the research objectives
2. Exploratory research
3. Stating research objectives
4. What is a theory?
5. What is a hypothesis?
C. Planning the research design
2. The “best” research approach
D. Planning a sample
E. Collecting data
1. Editing and coding
Chapter Three: The Marketing Research Process
F. Analyzing Data
G. Drawing conclusions
V. The Research Program Strategy
LEARNING OUTCOMES
1. Apply marketing research in making better marketing decisions.
3. List the major stages of the marketing research process and the steps within each.
5. Know the difference between a research project and a research program.
CHAPTER VIGNETTE: The Changing Educational Market
Students seeking a higher education enjoy many more choices than did their parents. It isn’t
simply the fields of study that may be new, but also the manner of study. Options for non-
traditional students who have difficulty attending day classes or devoting years of study to
obtaining a degree have grown exponentially. Some institutions cater to these needs (e.g.,
SURVEY THIS!
Now that students have been through the survey, they can use it to help better learn course
RESEARCH SNAPSHOTS
➢ Heard it Through the Grapevine
Exploratory research helps firms to develop innovative products and marketing techniques
that have a chance to be successful because they were researched in advance. General Electric
Chapter Three: The Marketing Research Process
➢ Feel the Power
Large amounts of quantitative data can only go so far in giving a firm a complete picture of
consumer desires. Increasingly, marketing researchers are turning to “thick” data, which is
generated from descriptive studies. Samsung used this approach and discovered that
consumers prefer television sets that look good even when turned off. As a result, Samsung
➢ A Winning Theory?
When a problem crops up in an industry, managers need to understand how the problem
developed in order to know how to solve it. Theory plays a major role in this process. The
U.S. gambling industry has begun to decline, and one theory to explain this decline is that
TIPS OF THE TRADE
➢ Diagnostic analysis can help distinguish symptoms from problems.
➢ Use exploratory research tools in the interviews with managers to help establish research
objectives.
➢ Ambiguous decision making situations, particularly in opportunity seeking, usually call for
exploratory research. With more certainty, very specific research questions will often call for
a causal design. For example:
▪ In what ways can Digitex leverage its brand name into new industries? Because this
is a broad and relatively vague question, discovery oriented exploratory research
➢ Don’t overlook the first stage of the research process—defining research objectives. The
deliverables can be the most important part of a research proposal.
▪ Good deliverable: Provide a measure of consumer shopping value perceptions for
Chapter Three: The Marketing Research Process
OUTLINE
I. INTRODUCTION
A. Researchers contribute to decision making in several key ways:
1. Helping to better define the current situation
3. Defining the firm’s meaning—how consumers, competitors, and employees view
the firm
5. Testing ideas that will assist in implementing marketing strategy including
innovations
6. Examining how well a marketing theory describes marketing reality
II. DECISION MAKING AND MARKETING RESEARCH
A. Decision making is the process of developing and deciding among alternative ways
of resolving a problem or choosing from among alternative opportunities.
B. A market opportunity is a situation that makes some potential competitive
advantage possible.
C. A market problem is a situation that makes some significant negative consequence
more likely.
D. Problems are inferred from observable symptoms, which are observable cues that
serve as a signal of a problem because they are caused by that problem.
E. Certainty
2. Perfect certainty, especially about the future, is rare.
4. Predictions about forces that shape future events are educated guesses.
6. Marketing decisions generally involve uncertainty, particularly when seeking
different opportunities.
F. Ambiguity
1. Ambiguity means that the nature of the problem itself is unclear.
3. The most difficult decision situation, but perhaps the most common.
G. Classifying Decision Situations
1. Exhibit 3.1 depicts decision situations characterized by the nature of the decision
and the degree of ambiguity.
a. Under problem-focused decision making, as ambiguity is lessened, the
Chapter Three: The Marketing Research Process
III. TYPES OF MARKETING RESEARCH
A. Marketing research can be classified on the basis of technique or purpose.
B. Classifying marketing research on the basis of its purpose, it can be broken into three
categories: (1) exploratory, (2) descriptive, and (3) causal.
C. Exploratory research
2. Not intended to provide conclusive evidence from which to determine a
particular course of action
4. Innovation and exploratory research
5. Exploratory research and problem solving
a. Problems are not always obvious.
b. Researchers infer problems from symptoms, which are observable cues that
send a signal of some problem.
c. Example: a drop in market share is a symptom of a problem.
d. Exploratory research can help identify what is causing the symptom, so that
the problem can be solved.
D. Descriptive Research
1. Describes characteristics of objects, people, groups, organizations or
environments
3. Often helps describe market segments
5. Conducted with a considerable understanding of the situation being studied
7. Diagnostic analysis seeks to diagnose reasons for market outcomes and focuses
8. Sometimes provides an explanation by diagnosing differences among
competitors, but it does not provide direct evidence of causality
E. Causal Research
1. Allows causal inferences to be made
3. When something causes an effect, it means it brings it about or makes it happen;
the effect is the outcome.
5. Can take a long time to implement and often involves intricate designs that can
be very expensive
6. Causality
a. Causal research attempts to establish that when we do one thing, another
thing will follow – a causal inference is just such a conclusion.
b. A causal inference can only be supported when very specific causal evidence
exists, and the three critical pieces of causal evidence are:
Chapter Three: The Marketing Research Process
i. Temporal Sequence – deals with the time order of events; having an
appropriate causal order of events means the cause must occur before the
effect
ii. Concomitant Variation – occurs when two events “covary,” meaning
they vary systematically and when a change in the cause occurs, a
change in the outcome also is observed
(a) Correlation is often used to represent this.
iii. Nonspurious Association – any covariation between a cause and an
effect is true and not simply due to some other variable
(a) Even though the previous two conditions exist, a causal inference
cannot be made because both the cause and effect have some
common cause.
7. Degrees of Causality
a. Absolute causality means the cause is necessary and sufficient to bring
about the effect. This is impractical to establish in the behavioral sciences.
8. Experiments
a. A carefully controlled study in which the researcher manipulates a proposed
cause and observes any corresponding change in the proposed effect.
b. An experimental variable represents the proposed cause and is controlled
by the researcher by manipulating it.
F. Uncertainty Influences the Type of Research
1. Exhibit 3.4 contrasts the types of research with respect to:
a. Amount of uncertainty characterizing the decision situation
b. Key research statement (i.e., research questions or research hypothesis)
Chapter Three: The Marketing Research Process
IV. STAGES IN THE RESEARCH PROCESS
A. Marketing research often follows a general pattern of stages:
2. Planning a research design
4. Collecting data
6. Formulating conclusions and preparing a report
B. Conceptualized as a cyclical or circular-flow process (see Exhibit 3.5) because
conclusions from research studies can generate new ideas and knowledge that can
lead to further investigation.
C. Management is at the center of the process because the research objectives cannot be
properly defined without managerial input.
D. Stages overlap somewhat from a timing perspective, and later stages sometimes can
be completed before earlier ones.
E. Alternatives in the Research Process
2. Exhibit 3.6 shows the decisions that researchers must make in each stage.
F. Defining the Research Objectives
1. Beginning of the research process
3. In consulting, the term deliverables is often used to describe the objectives to a
research client.
4. In applied, or market research, the objectives cannot be listed until there is an
6. Defining the Managerial Decision Situation
a. An orderly definition of the research problem lends a sense of direction to the
7. Exploratory Research
a. Can be used to help identify the decisions that need to be made
b. Once done, the researcher should know exactly which data to collect during
formal phases of the project and how to conduct the project.
c. Can employ techniques from four basic categories to obtain insights and gain
Chapter Three: The Marketing Research Process
ii. Common in applied market research studies
iii. A fundamental requirement of a basic research report
f. Pilot Studies
i. Small scale research projects that collect data from respondents similar to
8. Stating Research Objectives
a. After identifying and clarifying the problem, the researcher must formally
9. What Is a Theory?
10. What Is a Hypothesis?
a. A hypothesis is a formal statement explaining some outcome.
b. Must be testable, so it must be written as a proposition
f. When the data are consistent with a hypothesis ► hypothesis is supported.
g. When the data are inconsistent with a hypothesis ►hypothesis is not
supported.
G. Planning the Research Design
1. A research design is a master plan that specifies the methods and procedures for
2. The researcher also must determine the sources of information, the design.
3. Selection of the Basic Research Method
Chapter Three: The Marketing Research Process
© 2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, in whole or in
part, except for use as permitted in a license distributed with a certain product or service or otherwise on a
password-protected website for classroom use.
a. Exhibit 3.6 shows four basic design techniques for descriptive and causal
research: surveys, experiments, secondary data, and observation.
b. Determination of which method should be chosen depends on:
i. Objectives of the study
ii. Available data sources
c. Most common method is the survey.
i. A survey is a research technique in which a sample is interviewed in
some form or their behavior is observed and described in some way.
ii. A researcher’s task is to find the most appropriate way to collect the
needed information (i.e., by telephone, mail, Internet, or in person).
4. The “Best” Research Approach
a. There is no single best research design.
H. Planning a Sample
1. Sampling involves any procedure that draws conclusions based on measurements
of a portion of the population (i.e., a subset from a larger population).
3. When errors are made (e.g., not using a representative sample), samples do not
give reliable estimates of the population.
4. Sampling decisions include:
a. Who is to be sampled? ► identification of a target population
I. Collecting Data
2. May be gathered by human observers or interviewers or may be recorded by
machines (e.g., scanner data)
4. However the data are collected, it is important to minimize errors in the process.
5. Editing and Coding
a. The data must be converted into a format that will answer the marketing
manager’s questions.
J. Analyzing Data
2. The appropriate analytical technique is determined by:
Chapter Three: The Marketing Research Process
© 2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, in whole or in
part, except for use as permitted in a license distributed with a certain product or service or otherwise on a
password-protected website for classroom use.
a. Management’s information requirements
b. Characteristics of the research design
c. Nature of the data gathered
3. Three general categories of statistical analysis (discussed in later chapters):
a. Univariate analysis
K. Drawing Conclusions
1. Consists of interpreting the research results, describing the implications and
drawing the appropriate conclusions for managerial decisions
3. A researcher should consider the varying abilities of people to understand the
research results.
V. THE RESEARCH PROGRAM STRATEGY
A. Research project – researcher has only one or a small number of research objectives
QUESTIONS FOR REVIEW AND CRITICAL THINKING/ANSWERS
1. List five ways that marketing research can contribute to effective business decision making.
Researchers contribute to decision making in several key ways. These include:
2. Define market opportunity, market problem and symptoms. Give an example of each as it
applies to a university business school.
A market opportunity is a situation that makes some potential competitive advantage possible. An
example of this for a university business school is technology, which could make distance
learning possible for students who otherwise would not be able to get an education. A market
Chapter Three: The Marketing Research Process
Declining enrollment in a university can be a symptom of a demographic trend in which the 18-
22 age segment is declining, or it could be caused by students selecting another university.
3. Consider the following list, and indicate and explain whether each best fits the definition of a
problem, opportunity, or symptom:
a. A 12.5 percent decrease in store traffic for a children’s shoe store in a medium-sized city
mall.
b. The number of recent graduates joining the business school alumni club has dropped 50
percent from 8 years ago.
This is an example of a symptom, which is an observable cue that serves as a signal of a problem
because it is caused by that problem.
c. A furniture manufacturer and retailer in North Carolina reads a research report indicating
consumer trends toward Australian Jara and Kari wood. The export of these products is
very limited and very expensive.
This could be viewed as a market opportunity because it is a situation that makes some potential
competitive advantage possible. That is, if this manufacturer can secure these types of wood at a
d. The number of cigarette smokers in sub-Saharan Africa is expected to increase
dramatically over the next decade.
This represents a market opportunity for because it is a situation that makes some potential
completive advantage possible.
e. A local fine-dining establishment cannot find enough applicants with sufficient skills to
learn how to deliver the quality of service its customers expect.
f. Next winter is expected to bring record-setting cold to most of the United States.
Depending on the business, this could be either a market problem or a market opportunity. For
heating oil companies, for instance, this would be a market opportunity. For retail businesses that
rely on customers to visit physical stores, this could be a market problem, as fewer people are
willing to brave the cold to go shopping.
4. What are the three types of marketing research? Indicate which type each item in the list
Chapter Three: The Marketing Research Process
The three types of marketing research are exploratory, descriptive, and causal. Exploratory
research is conducted to clarify ambiguous situations or discover ideas that may be potential
a. Establishing the relationship between advertising and sales in the beer industry.
Causal research. Establishing the functional relationship between advertising and sales is the
b. Identifying target market demographics for a shopping center located in Omaha,
Nebraska.
c. Estimating the 5-year sales potential for fMRI machines in the Ark-La-Tex (Arkansas,
Louisiana and Texas) region of the United States.
Descriptive Research. This research attempts to describe a market size.
d. Testing the effect of the inside temperature of a clothing store on sales of outerwear.
Causal research. This research can manipulate the temperature inside of a clothing store and
measure the impact on sales of outerwear.
Causal research. This research is attempting to demonstrate that online ordering would cause
Publix’s business performance to increase.
5. What is diagnostic analysis?
6. Describe the type of research evidence that allows one to infer causality.
change in the outcome also is observed. Nonspurious association means any co-variation between
a cause and effect is true and not simply due to some other variable. Often, a causal inference
cannot be made even though the other two conditions exist because both the cause and effect have
some common cause; that is, both may be influenced by a third variable.
Chapter Three: The Marketing Research Process
What is an experimental manipulation?
7. Describe how a literature search is useful in marketing research.
Before launching an exhaustive study, the researcher can first look through research journals and
8. Do the stages in the research process seem to follow the scientific method?
9. Why is the “define research objectives” of the research process probably the most important
stage?
10. Suppose Auchan (http://www.auchan.fr), a hyper-market chain based out of France, was
considering opening three hypermarkets in the midwestern United States. What role would
theory play in designing a research study to track how the shopping habits of consumers from
the United States differ from those in France and from those in Japan? What kind of
hypothesis might be examined in a study of this topic?
Chapter Three: The Marketing Research Process
c. A major music producer wonders how buzz initiated through Facebook might affect the
online revenue for new artists.
d. A food company researcher is interested in knowing what types of food are carried in
brown-bag lunches to learn if the company can capitalize on this phenomenon.
e. A researcher wishes to explore the feasibility of a casino in a community where gaming
had previously been banned.
unflattering videos of political opponents go viral on the web.
RESEARCH ACTIVITIES
1. Look up information about the online MBA programs at the University of Phoenix
(http://business.phoenix.edu/business/graduate.aspx). Compare it to the traditional MBA
program at your university. Suppose each was looking to expand the numbers of students in
their programs. How might the research design differ for each?
2. Visit the Gallup Organization’s home page (http://www.gallup.com). The Gallup home page
changes regularly. However, it should provide an opportunity to read the results of a recent
poll. For example, one poll showed Americans level of concern or lack of concern with
global warming. Summarize your opinion of the poll. Do you believe it is accurate? What
Chapter Three: The Marketing Research Process
companies or organizations might benefit from this data? Gallup provides a basic description
3. Any significant business decision requires input from a research project. Write a brief essay
either defending this statement or refuting it.
The need for research depends on the situation. Situations can be characterized by complete
4. What is a peoplemeter? Describe how it works and what data it provides. Suppose you were
asked by a supervisor to prepare a blog entry describing your opinion of its validity. What would
be your position and how would you defend it?
CASE 3.1 A New “Joe” on the Block
Joe Brown, a 30-year veteran market researcher, is ready to enter the coffee shop business. He
has some key research questions:
• What markets in the United States hold the most promise for a new coffee shop?
• What type of location is best for a coffee shop?
• What is it that makes a coffee shop popular?
• What coffee do Americans prefer?
• How would consumers respond to coffee delivery?
Chapter Three: The Marketing Research Process
Questions
1. What are the top three key decisions faced by Joe?
Joe has many decisions to make, and students’ responses will vary. One is the decision regarding
where to locate his business, and once that is decided, he must determine the type of outlet (i.e.,
2. What are the key deliverables that an outside researcher should produce to help Joe with the
key decisions?
3. How relevant are the coffee taste studies cited above? Explain.
The relevance of the coffee taste studies cited depends on how Joe will position his coffee shop.
Does he intend to compete head-to–head with Starbucks? McDonald’s? Dunkin’ Donuts? One key
4. What flaws in the coffee taste studies should Joe consider in trying to weigh the merits of
their results?
The sample used in each study is important. How large is it? Who are the respondents? Are they
representative of his target market? Questions like these need to be addressed to determine if the
5. Try to do a quick search to explore the question: “Are American consumer preferences the
same all across the United States?”
Students’ responses will vary, but merely searching “US coffee consumption” in Google provides
considerable information. For example, one source indicated that over half of the U.S. population
