market research
Content
MARKET RESEARCH Market Research is the process of collecting infor-mation and data about a firms customers, the market place the firm operates within (sells to), and the ac-tivities of competitors within that marketplace. Market research involves study of ; the size of the market in terms of numbers of customers and value of sales, the niches or segments that exist within the market how competitor firms behave the demographic make-up of the consumers i.e. how old they are, sex mix, incomes etc. the emotional and rational ties that customers have with the firms¶ products and competitor products. The objective of market research is therefore, to gain detailed knowledge about the market that exists for the firms current or future products, so that the firm can be as confident as possible that each marketing and product development £ spent, has been a £ well spent.
Themes of market research.
Market research focuses on three main themes. These are: The market The product Activities of competition.
MARKET RESEARCH PROCESS
STEPS
Define the problem or Study objective
CONSIDERATIONS
What are the 2-3 main things that need answered? How will you make a decision?
Clarify schedule and cost constraints
When do you need to deliver to decision-makers?
Outline Research Design Develop Data Collection Instrument(s) Create Sample Plan
How will you answer the key research questions? What type of analysis is needed? Will you use telephone surveys, mail surveys, internet surveys, personal interviews, focus groups, or a combination? Who should participate? What are barriers to reaching them?
Have other similar studies been done? Do you want to track or trend data over time? Are you comparing to national studies? Do you need a screener / do you have skip patterns? What analysis do you intend to conduct?
What population are you trying to describe ? Do you need/want to represent certain sub -groups within that population? Create sample frame / selection process / sample size / acquire sample
Outline Analysis Plan
Match survey questions to the future analyses you intend to conduct Outline expected relationships, group differences, etc.
Pretest Collect Data
Internally with work colleagues first Externally with 1-2 actual respondents Test flow / timing / interpretations
Cleaning, Coding, Editing
Often the longest step in the process ± allow for ample data collection time in your schedule
Analysis / Interpretation Investigate Conflicting /
A market research vendor will clean data, code open ended questions, provide data tabulations and raw data
Tools ± Data collection :
Data collection is the most expensive step in Marketing research and is very much prone to errors. However, data collection methods are improving day by day due to computerization of all the related activities. Some of the common techniques / tools used in data collection are listed below:
1. Experimentation :
This is used to test/assess the effect of some elements in the marketing mix. Two main types of experiments are ± field experiments and lab experiments.
2. Observation:
Selective methods to describe people or physical phenomenon. There exists no interview or response bias. This can be of the following types ± people observing people, mechanical devices observing people (eye camera, tape recorders), physical phenomena observed by people and physical phenomena observed by mechanical devices.
3. Questionnaires:
This is one of the most common methods of data collection. It can be conducted by mail, telephone or personal interviews. It should use simple, direct, unbiased wording and should be pre-tested with a sample of respondents.
4. Surveys:
Surveys can be of the following types - postal surveys, telephone surveys, personal interviews etc., Postal surveys are low cost but there is no control over the person actually filling in the questionnaire. This is useful when time is short but has the disadvantage that questions which require some time to answer wont be effective. Personal interviews require some preparation in the form of pilot visits to test out the questionnaire.
5. Motivational research techniques:
It is used for discovering the underlying motives, desires and emotions of consumers that influence their behaviour. Techniques used are ± depth interviewing, group interviewing and projective techniques.
ANALYSIS OF DATA AND INFERENCES
After data collection process is complete, the researcher has to extract findings and inferences. For this, the researcher tabulates the data and performs frequency distribution calculations and measures mean dispersions etc., He may also use statistical techniques and decision models to obtain additional inferences. Some of the tools used by the researchers are:
A. Statistical tools
1.Multiple regression:
For finding best fitting equations of a dependant variable which varies with changing values in a number of independent variables. The inference obtained can estimate how unit sales are influenced by changes in the level of company advertising expenditures sales force size and price.
2.Cluster analysis:
A statistical technique used for separating objects into a specified number of manually exclusivel groups. For eg: This can be used to classify a set of cities into a definite number of groups.
3. Factor analysis:
It is used for determining a few underlying factors of a larger set of interrelated variables.
B. Models 1. Markov-process model: This model shows the probability of moving from a current state to any future state. 2. Queuing model:
This model shows the waiting times and the queue lengths that can be expected in any systems given the arrival and service times and the number of service channels. This can be used to determine the waiting times involved in queues given the number of service channels and service speeds.
3. Sales response model:
This is a set of models to estimate functional relationship between one or more marketing variables.
APPLICATIONS OF MARKETING RESEARCH
The main areas of applications of marketing research are sales and market analysis, product research, advertising, business economics and corporate research, and corporate responsibility.
1. Sales and market analysis
This is conducted for: a) b) c) d) e) f) g) h) Determination of market potential Determination of market share Sales forecasting Design of market segmentation studies Test market Distribution channel Determination of market characteristics Determination of competitive information
2. Product Research
This is used for making the following inferences: a) b) c) d) Evaluation of new product ideas Testing of a new product acceptance Testing package design Testing product positioning
3. Business Economics and Corporate Research
The following research works are carried out for: a) b) c) d) e) Study of bysiness trends Pricing studies Diversification studies Product-mix-studies Plant and warehouse location studies.
4. Advertising Research
The following are obtaining from advertisement research: a) Audience measurement b) Determining the most cost effective media plan c) Determining advertising effectiveness. 5. Consumer behaviour research The following inferences are derived from customer behaviour researches: a) The target customer b) Location of the target customer c) Motivation of the customer to buy a brand
d) The busying behaviour pattern e) Post purchase satisfaction levels. The best way to use collect datas for the implementation is through questionnaire.
Themes of market research.
Market research focuses on three main themes. These are: The market The product Activities of competition.
MARKET RESEARCH PROCESS
STEPS
Define the problem or Study objective
CONSIDERATIONS
What are the 2-3 main things that need answered? How will you make a decision?
Clarify schedule and cost constraints
When do you need to deliver to decision-makers?
Outline Research Design Develop Data Collection Instrument(s) Create Sample Plan
How will you answer the key research questions? What type of analysis is needed? Will you use telephone surveys, mail surveys, internet surveys, personal interviews, focus groups, or a combination? Who should participate? What are barriers to reaching them?
Have other similar studies been done? Do you want to track or trend data over time? Are you comparing to national studies? Do you need a screener / do you have skip patterns? What analysis do you intend to conduct?
What population are you trying to describe ? Do you need/want to represent certain sub -groups within that population? Create sample frame / selection process / sample size / acquire sample
Outline Analysis Plan
Match survey questions to the future analyses you intend to conduct Outline expected relationships, group differences, etc.
Pretest Collect Data
Internally with work colleagues first Externally with 1-2 actual respondents Test flow / timing / interpretations
Cleaning, Coding, Editing
Often the longest step in the process ± allow for ample data collection time in your schedule
Analysis / Interpretation Investigate Conflicting /
A market research vendor will clean data, code open ended questions, provide data tabulations and raw data
Tools ± Data collection :
Data collection is the most expensive step in Marketing research and is very much prone to errors. However, data collection methods are improving day by day due to computerization of all the related activities. Some of the common techniques / tools used in data collection are listed below:
1. Experimentation :
This is used to test/assess the effect of some elements in the marketing mix. Two main types of experiments are ± field experiments and lab experiments.
2. Observation:
Selective methods to describe people or physical phenomenon. There exists no interview or response bias. This can be of the following types ± people observing people, mechanical devices observing people (eye camera, tape recorders), physical phenomena observed by people and physical phenomena observed by mechanical devices.
3. Questionnaires:
This is one of the most common methods of data collection. It can be conducted by mail, telephone or personal interviews. It should use simple, direct, unbiased wording and should be pre-tested with a sample of respondents.
4. Surveys:
Surveys can be of the following types - postal surveys, telephone surveys, personal interviews etc., Postal surveys are low cost but there is no control over the person actually filling in the questionnaire. This is useful when time is short but has the disadvantage that questions which require some time to answer wont be effective. Personal interviews require some preparation in the form of pilot visits to test out the questionnaire.
5. Motivational research techniques:
It is used for discovering the underlying motives, desires and emotions of consumers that influence their behaviour. Techniques used are ± depth interviewing, group interviewing and projective techniques.
ANALYSIS OF DATA AND INFERENCES
After data collection process is complete, the researcher has to extract findings and inferences. For this, the researcher tabulates the data and performs frequency distribution calculations and measures mean dispersions etc., He may also use statistical techniques and decision models to obtain additional inferences. Some of the tools used by the researchers are:
A. Statistical tools
1.Multiple regression:
For finding best fitting equations of a dependant variable which varies with changing values in a number of independent variables. The inference obtained can estimate how unit sales are influenced by changes in the level of company advertising expenditures sales force size and price.
2.Cluster analysis:
A statistical technique used for separating objects into a specified number of manually exclusivel groups. For eg: This can be used to classify a set of cities into a definite number of groups.
3. Factor analysis:
It is used for determining a few underlying factors of a larger set of interrelated variables.
B. Models 1. Markov-process model: This model shows the probability of moving from a current state to any future state. 2. Queuing model:
This model shows the waiting times and the queue lengths that can be expected in any systems given the arrival and service times and the number of service channels. This can be used to determine the waiting times involved in queues given the number of service channels and service speeds.
3. Sales response model:
This is a set of models to estimate functional relationship between one or more marketing variables.
APPLICATIONS OF MARKETING RESEARCH
The main areas of applications of marketing research are sales and market analysis, product research, advertising, business economics and corporate research, and corporate responsibility.
1. Sales and market analysis
This is conducted for: a) b) c) d) e) f) g) h) Determination of market potential Determination of market share Sales forecasting Design of market segmentation studies Test market Distribution channel Determination of market characteristics Determination of competitive information
2. Product Research
This is used for making the following inferences: a) b) c) d) Evaluation of new product ideas Testing of a new product acceptance Testing package design Testing product positioning
3. Business Economics and Corporate Research
The following research works are carried out for: a) b) c) d) e) Study of bysiness trends Pricing studies Diversification studies Product-mix-studies Plant and warehouse location studies.
4. Advertising Research
The following are obtaining from advertisement research: a) Audience measurement b) Determining the most cost effective media plan c) Determining advertising effectiveness. 5. Consumer behaviour research The following inferences are derived from customer behaviour researches: a) The target customer b) Location of the target customer c) Motivation of the customer to buy a brand
d) The busying behaviour pattern e) Post purchase satisfaction levels. The best way to use collect datas for the implementation is through questionnaire.
