Chapter 07 – Marketing Research: From Customer Insights to Actions
7-1
CHAPTER CONTENTS
PAGE
POWERPOINT RESOURCES TO USE WITH LECTURES ……………………………………. 7-2
LEARNING OBJECTIVES (LO) …………………………………………………………………………….. 7-4
KEY TERMS …………………………………………………………………………………………………………… 7-4
LECTURE NOTES
• Chapter Opener: Hollywood Loves Marketing Research ……………………………………… 7-5
• The Role of Marketing Research (LO 7-1; LO 7-2) ……………………………………………. 7-6
• Step 1: Define the Problem ………………………………………………………………………………. 7-7
• Step 2: Develop the Research Plan ……………………………………………………………………. 7-8
APPLYING MARKETING KNOWLEDGE ……………………………………………………………. 7-34
BUILDING YOUR MARKETING PLAN ……………………………………………………………….. 7-38
VIDEO CASE (VC)
• VC-7: Carmex [A]: Leveraging Facebook for Marketing Research ………………………. 7-40
IN-CLASS ACTIVITIES (ICA)
• ICA 7-1: Interpreting Census Data …………………………………………………………………… 7-44
CONNECT EXERCISES ………………………………………………………………… 7-59
• Marketing Research Strategies at Frito-Lay Case Analysis
• Marketing Research Approach Click and Drag*
• Carmex: Leveraging Facebook for Marketing Research Video Case
• iSeeit! Video Case: Market Research Process Video Case
Chapter 07 – Marketing Research: From Customer Insights to Actions
7-2
Chapter 07 – Marketing Research: From Customer Insights to Actions
7-3
POWERPOINT RESOURCES TO USE WITH LECTURES
PowerPoint
Textbook Figures Slide
Figure 7-1 Five-step marketing research approach leading to marketing actions ………………………. 7-6
Figure 7-2 Types of marketing information ………………………………………………………………………… 7-11
Figure 7-3 Nielsen Television Index Rating Report for network primetime households ……………. 7-19
Figure 7-4A Different types of questions in a sample Wendy’s survey (Q1-Q5) …………………….. 7-25
Figure 7-4A (Q1) Open-ended question ……………………………………………………………………………… 7-26
Figure 7-4B Different types of questions in a sample Wendy’s survey (Q6-Q9) …………………….. 7-31
Figure 7-4B (Q6) Likert scale question ………………………………………………………………………………. 7-32
Figure 7-5 How marketing researchers and managers use information technology to turn
information into action ……………………………………………………………………………………. 7-41
Figure 7-6 Marketing dashboards present findings to Tony’s marketing manager that leads to
recommendations and actions ……………………………………………………………………………. 7-44
Figure 7-8 Linear trend extrapolation of sales revenues at Xerox, made at the start of 2000 ………. 7-48
Chapter 07 – Marketing Research: From Customer Insights to Actions
7-4
POWERPOINT RESOURCES TO USE WITH LECTURES
PowerPoint
Applying Marketing Metrics Slide
Are the Carmex Social Media Programs Working Well?: Conversation Velocity, Share of Voice,
and Sentiment ………………………………………………………………………………………………………………….. 7-37
Marketing Matters, Making Responsible Decisions
Marketing Matters: Online Databases and Internet Resources Useful to Marketers …………………… 7-16
Videos
7-1: Black Panther Movie Trailer ……………………………………………………….………………………………… 7-4
7-3: Trend Hunter Video ……………………………………………………………………………………………………. 7-22
In-Class Activities (ICA)
ICA 7-1: Interpreting Census Data ……………………………………………………………………………………… 7-58
ICA 7-3: Designing a Taste Test Survey for Howlin’ Coyote Chili …………………………………………. 7-62
Chapter 07 – Marketing Research: From Customer Insights to Actions
7-5
LEARNING OBJECTIVES (LO)
After reading this chapter students should be able to:
LO 7-1: Identify the reason for conducting marketing research.
LO 7-3: Explain how marketing uses secondary and primary data.
LO 7-5: Explain how data analytics, data mining, and predictive modeling lead to marketing
actions.
KEY TERMS
constraints
observational data
cross tabulation
primary data
data
questionnaire data
information technology
sales forecast
marketing research
secondary data
measures of success
Chapter 07 – Marketing Research: From Customer Insights to Actions
7-6
LECTURE NOTES
MARKETING RESEARCH GOES TO THE MOVIES
Some movies are blockbusters—Black Panther, Avatar, Titanic, Star Wars: The Last
Jedi—accounting for billions of dollars. Unfortunately, not all movies have such
favorable results.
How can studies try to reduce the risk that a movie will be a box-office flop? Marketing
research!
A. A Film Industry Secret
• Studio executives face risks including bad titles, poor scripts, competing movies,
and more.
a. As a form of marketing research to…
• Filmmakers want movie titles that:
a. Are concise. c. Capture the essence of the film.
• These are the same factors that make a good brand name.
a. Concept testing and script assessment.
• Used to assess early ideas for proposed new films.
[Video 7-1: Black Panther Movie Trailer]
b. Test (or preview) screenings.
• Obtain the key reactions of consumers likely to be in the target audience.
• Test screenings include 300 to 400 moviegoers recruited to attend a
c. Tracking studies.
Chapter 07 – Marketing Research: From Customer Insights to Actions
7-7
• Are conducted immediately before an upcoming film’s release to forecast
its opening week’s box-office revenue.
I. THE ROLE OF MARKETING RESEARCH [LO 7-1]
Marketing research in perspective: (1) what it is, (2) some difficulties in conducting it,
and (3) the five steps marketers use to conduct it.
A. What Is Marketing Research?
• Marketing research is the process of defining a marketing problem and
B. The Challenges of Doing Good Marketing Research
• Marketing researchers face difficulties in asking consumers questions about new,
unknown, or personal-type products.
a. How can marketing research determine if consumers will buy a product they
have never seen, and never thought about, before?
b. How can marketing research obtain answers that people know but are
reluctant to reveal?
c. How can marketing research help people accurately remember and report their
interests, intentions, and purchases?
C. Five-Step Marketing Research Approach [LO 7-2]
• A decision is a conscious choice from among two or more alternatives.
• [Figure 7-1] Marketers use a 5-step marketing research approach to collect
information from consumers to improve marketing decisions and actions.
Chapter 07 – Marketing Research: From Customer Insights to Actions
7-8
II. STEP 1: DEFINE THE PROBLEM
• LEGO Group’s definition of “toy” has changed dramatically in the last half century –
from interlocking plastic bricks to construction sets that create figures, vehicles,
buildings, and robots.
a. LEGO introduced MINDSTORMS® kit, a “toy” that integrates electronics,
• LEGO shows how to define the marketing problem and its two key elements:
a. Setting the research objectives.
• Identifying possible marketing actions.
A. Set the Research Objectives
• Research objectives are specific measurable goals the decision maker seeks to
B. Identify Possible Marketing Actions
• Effective decision makers develop specific measures of success, which are
criteria or standards used in evaluating proposed solutions to the problem.
• Different research outcomes—based on the measure of success—lead to different
marketing actions.
• Marketing researchers know that defining a problem is an incredibly difficult task.
• This is why marketing researchers:
Chapter 07 – Marketing Research: From Customer Insights to Actions
7-9
III. STEP 2: DEVELOP THE RESEARCH PLAN
The second step in the marketing research process involves:
A. Specify Constraints
• The constraints in a decision are the restrictions placed on potential solutions to a
problem.
• Common constraints in marketing problems are limitations on the time and
money available to solve the research problem.
• Examples of constraints set by LEGO:
B. Identify Data Needed for Marketing Actions
• Effective marketing research studies focus on collecting data that will lead to
effective marketing actions.
C. Determine How to Collect Data
Two key elements in deciding how to collect data are (1) concepts and (2) methods.
1. Concepts.
2. Methods.
a. Methods are the approaches that can be used to collect data to solve all or part
of a research problem.
b. A key issue in developing a marketing research plan: Is observing consumers’
behavior better than asking them questions?
Chapter 07 – Marketing Research: From Customer Insights to Actions
7-10
• Can we observe behavior without biasing the results?
c. Information on useful methods is available in tradebooks, textbooks, and
handbooks that relate to marketing and marketing research.
d. Some periodicals and journals summarize useful methods that solve marketing
problems. The American Marketing Association publishes the:
• Journal of Marketing.
e. Special methods vital to marketing research are:
• Sampling.
– Involves selecting representative elements from a population, such as
• Statistical inference. Involves drawing conclusions or generalizing the
Chapter 07 – Marketing Research: From Customer Insights to Actions
7-11
LEARNING REVIEW
7-1. What is marketing research?
7-2. What is the five-step marketing research approach?
Answer: The five-step marketing research approach provides a systematic checklist for
7-3. What are constraints, as they apply to developing a research plan?
Answer: Constraints in a decision are the restrictions placed on potential solutions to a
IV. STEP 3: COLLECT RELEVANT INFORMATION [LO 7-3]
• Collecting enough relevant information to make rational, informed marketing
decisions can entail collecting an enormous amount of information at great expense.
• Data are the facts and figures related to the project.
• [Figure 7-2] Data are divided into:
a. Secondary data are facts and figures that have already been recorded prior to the
project at hand.
b. Primary data are facts and figures that are newly collected for the project.
A. Secondary Data: Internal
a. Marketing input data.
• Relate to the effort expended to make sales.
• Are obtained from:
Chapter 07 – Marketing Research: From Customer Insights to Actions
7-12
b. Marketing outcome data.
• Relate to the results of the marketing efforts.
• Include:
– Billing records on shipments.
B. Secondary Data: External
• Published data from outside the organization are external secondary data.
• Includes data published by the U.S. Census Bureau:
a. Census 2010 was a count of the U.S. population in 2010.
• Is conducted every 10 years.
[Video 7-2: Census]
[ICA 7-1: Interpreting Census Data]
b. Recently, the Census Bureau began collecting data annually from a smaller
number of people through the American Community Survey.
c. The Census Bureau also publishes the Economic Census.
• Is conducted every five years.
Chapter 07 – Marketing Research: From Customer Insights to Actions
7-13
• Syndicated panels.
a. Consist of market research firms that pay households and businesses to…
b. Record all their purchases using a paper or electronic diary.
c. Allow researchers to economically obtain answers to questions:
d. Examples of data obtained from syndicated panels:
• Other data service firms:
a. Provide information on:
• Household demographics. • Media behavior.
b. Can collect, analyze, interrelate, and present all this information.
c. Include SymphonyIRI Group’s InfoScan.
d. Sales data are:
• Collected using scanners at checkout counters of supermarket, drug,
• Trade associations, universities, and business periodicals also provide detailed
data to market researchers and planners.
[ICA 7-2: Websites for Marketers]
Chapter 07 – Marketing Research: From Customer Insights to Actions
7-14
MARKETING MATTERS
Online Databases and Internet Resources Useful to Marketers
Marketers in search of secondary data utilize a variety of online databases and
Internet resources: articles in periodicals, statistical or financial data on markets, products,
and organizations and reports form information companies.
a. Sources of news and articles include:
b. Sources of statistical and financial data include:
• FedStats and the Census Bureau – information on U.S. business
C. Advantages and Disadvantages of Secondary Data
• Marketers generally obtain secondary data first and then collect primary data.
• Advantages of secondary data are:
a. Time savings, if the data:
b. Low cost, such as free or inexpensive Census reports.
c. Greater level of detail, especially in Census data.
• Disadvantages of secondary data are:
a. May be out of date.
b. The definitions or categories may not be quite right for the project.
c. The data are collected for another purpose and may not be specific enough for
the project.
Chapter 07 – Marketing Research: From Customer Insights to Actions
7-15
LEARNING REVIEW
7-4. What is the difference between secondary and primary data?
7-5. What are some advantages and disadvantages of secondary data?
Answer: Advantages of secondary data are the time savings, the low cost, and the
D. Primary Data: Watching People [LO 7-4]
• The two ways to collect new or primary data for a marketing study are by
(1) watching people and (2) asking them questions.
• Observational data:
1. Mechanical Methods.
a. [Figure 7-3] Nielsen Media Research national TV ratings are mechanical
observational data collected by a “people meter” that:
• Connects to a box attached to TV sets, DVRs, cable boxes, satellite dishes,
etc. in about 30,000 households across the country.
• Has a remote a viewer presses to begin and finish watching a TV program.
b. Nielsen introduced “cross–platform campaign ratings” that:
• Combine its existing TV ratings with its new online campaign ratings.
• Include consumer viewing of TV programs:
Chapter 07 – Marketing Research: From Customer Insights to Actions
7-16
c. On the basis of all these observational data, Nielsen then calculates the rating
and share of each TV program:
• With 119.6 million TV households in the U.S., a single ratings point
equals 1 percent, or 1,196,000 TV households.
• A share point is the percentage of TV sets in use tuned to a particular
program.
• A 1% change in a rating point:
• Broadcast and cable TV networks:
– May change the time slot or even cancel a TV program…
d. But TV advertisers today have a special problem:
• With about three out of four TV viewers skipping ads with a DVR or
TiVo, or channel surfing during commercials, how many people are
actually seeing the TV ad?
e. The data in Figure 7-3 include viewers who either or.
• Watched the programs live.
2. Personal Methods.
Watching consumers in person is another approach to collecting data.
a. Mystery shoppers.
• Pose as a customer and observe behaviors.
• Are paid by firms to check on:
• Provide clients with unique marketing research information that can be
obtained in no other way.
Chapter 07 – Marketing Research: From Customer Insights to Actions
7-17
b. Two other observational approaches:
• Watching consumers in person.
• Recording consumers with video cameras.
c. Ethnographic research.
• Is a specialized form of observational research.
• Occurs when trained observers:
d. Personal observation has advantages and disadvantages:
• Is useful and flexible.
• Can be costly and unreliable when different observers report different
conclusions in watching the same event.
3. Neuromarketing Methods.
a. Neuromarketing observes responses to non-conscious stimuli and is a new
field of studies that merges technology with understanding consumers.
b. Aradhna Krishna, one of the field’s experts, suggests that “many companies
are just starting to recognize how strongly the senses affect the deepest parts
E. Primary Data: Asking People
• Most people have filled out some kind of a questionnaire or received a telephone
or an e-mail to get their opinions about a particular product, service, or idea.
• Questionnaire data are facts and figures obtained by asking people about their
attitudes, awareness, intentions, and behaviors.
1. Idea Generation Methods—Coming Up with Ideas.
a. Individual interviews.
Chapter 07 – Marketing Research: From Customer Insights to Actions
7-18
• Involve a single researcher asking questions of one respondent.
• Has this advantage:
• Has this disadvantage: Is very expensive.
b. Depth interviews.
c. Focus groups.
• Are informal sessions of 6 to 10 past, present, or prospective customers:
– In which a discussion leader, or moderator, asks their opinions about…
• Are often video-recorded and conducted in special rooms with a one-way
mirror so that marketers can hear and watch consumer reactions.
• Can be effective in uncovering ideas that:
– Are often difficult to obtain with individual interviews…
– Due to the peer interaction of the members.
d. “Fuzzy front end” methods.
• Are attempts to identify elusive consumer tastes or trends.
• Are used by consumer product firms to find new product ideas.
• Example: Trend Hunter identifies “emerging shifts in social behavior,”
which are driven by changes in pop culture that can lead to new products.
[Video 7-3: Trend Hunter Video]
2. Idea Evaluation Methods—Testing an Idea.
a. In idea evaluation, the marketing researcher tests ideas to help the marketing
manager recommend marketing actions.
b. Idea evaluation often involves using these conventional questionnaire formats:
Chapter 07 – Marketing Research: From Customer Insights to Actions
7-19
• Personal interview.
c. These surveys are administered to a large sample of past, present, or
prospective consumers.
d. Researchers have to make important trade-offs to balance cost of a particular
survey method against the expected quality of the data obtained.
• Personal interview surveys.
– Are flexible in:
• Mail surveys.
– Are easy to conduct.
• Telephone interviews.
– Allow flexibility.
– Are efficient if computer-assisted telephone interviewing (CATI) is
• Online surveys.
– Consist of both e-mail and Internet surveys.
– Why? Because most consumers have an Internet connection and an
e-mail address.
– E-mail surveys.
Chapter 07 – Marketing Research: From Customer Insights to Actions
◊ See the survey directly or…
◊ Click on a link to access it from a website.
* Disadvantages of e-mail surveys. Some consumers:
◊ Have a “pop–up blocker” that…
◊ Prohibits a browser from opening a separate window that
contains the survey.
◊ Thus, these consumers won’t be able to participate in the
research.
invasion of privacy.
e. The foundation of all research using questionnaires is developing precise
questions that get clear, unambiguous answers very efficiently.
f. [Figure 7-4] Question formats as depicted in a Wendy’s survey that assessed
fast-food restaurant preferences among present and prospective consumers: