Chapter Four

1. Chapter Four Research Design and Implementation Essentials of Marketing Research Kumar, Aaker, Day

2. Marketing Research Process – Part 2 Some time ago, IBM sold of their PC division to a Chinese firm called Lenovo. The Chinese company is now offers laptop computers to the US market (originally sold by IBM under the ThinkPad name). Lenovo has a choice: • Using the original Think Pad logo or • Using a newly designed logo. As a market research firm, please create a research design for helping the company take a decision. Essentials of Marketing Research Kumar, Aaker, Day

3. Background Questions • Problem: • Which logo should Lenovo use? • Decision alternatives: • Should Lenovo go ahead with a new logo or use the Think Pad logo • Research Objective • To determine which logo enjoys the most positive associations • To determine which logo causes the greatest willingness to buy Essentials of Marketing Research Kumar, Aaker, Day

4. Research design • Detailed blueprint used to guide the research study to its objectives • Defines research approach to be used for obtaining information Essentials of Marketing Research Kumar, Aaker, Day

5. RESEARCH DESIGN PROCESS Research Approach Exploratory Descriptive Causal Research Design Choice of data collection method Secondary, standardized, qualitative, Surveys, experiments Role of research supplier Project design Raw data collection Research Tactics Develop measures, Questionnaire, Design experiments, design sampling plan, anticipate analysis Essentials of Marketing Research Kumar, Aaker, Day

6. Categories of Research Approaches Exploratory Causal Descriptive Each element plays a distinct and complementary role! Essentials of Marketing Research Kumar, Aaker, Day

7. Exploratory Research • Used when seeking insights • Into the general nature of the problem • The decision alternatives • The variables to be included • The questions – “why” and “how” are important • The probe Essentials of Marketing Research Kumar, Aaker, Day

8. Lenovo case • Research Objective: • How do consumers perceive the Think Pad logo and the new logo? • Research Approach: • Exploratory research to understand all associations the two logos throw up • Choice of data collection method: • Qualitative: Focus groups, in-depth interviews Essentials of Marketing Research Kumar, Aaker, Day

9. Exploratory Research – Another Example • Case 2: Levis is considered by many to be a fading brand. The company wants to revitalize it and would like to understand why Levis does not appeal to its target demographic Essentials of Marketing Research Kumar, Aaker, Day

10. Limitations of Exploratory Research • No hypothesis or vague or ill-defined hypothesis • Not possible to confirm / disconfirm • No firm preconceptions of what will be found • Biased – relies too much on the interpretation of the researcher • Inaccurate recording and reporting • Technology overcomes this to a large extent • Limited generalizability (external invalidity) Essentials of Marketing Research Kumar, Aaker, Day

11. Descriptive Research • Most marketing research falls in this category • Greatest application: describe a marketing situation • Hypothesis exist but may be tentative and speculative • Can only show if two variables are associated • May precede causal research Essentials of Marketing Research Kumar, Aaker, Day

12. Limitations of Descriptive Research • Does not focus on the ‘why’ – understanding phenomena • Cannot be used for prediction and control Essentials of Marketing Research Kumar, Aaker, Day

13. Lenovo Case • Now that we know what associations do the two logos throw up, what is our next step? • Research Objectives: • Find out the degree of closeness of these associations with the logos • Find out how favorably each association is perceived • Find out which logo do consumers prefer • Find out if their preferences are related to their willingness to buy Essentials of Marketing Research Kumar, Aaker, Day

14. Lenovo Case • Why not collect this data during exploratory research? • What would this information be useful for? Essentials of Marketing Research Kumar, Aaker, Day

15. Lenovo case • Research Approach: • Descriptive Research • Choice of data collection method: • Surveys • Which variables do we measure? • Closeness of association with logo • Favorability of association • Preferences for logo • Willingness to buy Essentials of Marketing Research Kumar, Aaker, Day

16. Descriptive Research examples • Owners who like SUVs are the most vocal about high gas prices • Americans who frequently travel abroad are more accepting of higher gas prices • What is the market size of regular coffee drinkers? • What are the preference levels for coffee and tea? Essentials of Marketing Research Kumar, Aaker, Day

17. Lenovo case • Now that we know the preferences for each logo, and their willingness to buy, what should our next step be? • Research Objective: • Confirm that it is the preference for the brand logo ONLY that causes the willingness to buy • Hypothesis: • Consumer preference for the Think Pad logo is positively related to their willingness to buy the product Essentials of Marketing Research Kumar, Aaker, Day

18. Some more causal research Hypotheses • Attitude to SUVs is negatively related to high gas price acceptability • Greater frequency of travel abroad is positively related to acceptability of high gas prices • Greater awareness of American culture is positively related to Starbucks acceptability Essentials of Marketing Research Kumar, Aaker, Day

19. Causal Research • Shows that one variable causes or determines the value of another variable • Hence controlling one variable can help control the other • Causality can be inferred only if: 1. Evidence of a strong association between the predictor and dependent variables 2. The predictor variable precedes the dependent variable in time 3. Other rival explanations are ruled out • Hypothesis stated very specifically in terms of variables and quantity or direction Essentials of Marketing Research Kumar, Aaker, Day

20. Exploratory / Descriptive / Causal Essentials of Marketing Research Kumar, Aaker, Day

21. Experimental Designs • Designs to infer causality • Aid understanding (“why”) of phenomena • Allows prediction and control • The observation – “O”; and exposure or manipulation – “X” • If “X” really does cause “O” then the experiment has internal validity • If there is a question then we may have Plausible Rival Explanations (PRE) Essentials of Marketing Research Kumar, Aaker, Day

22. Some PRE for the Lenovo case • Pre-existing knowledge of company and its country of origin may influence willingness to buy • The product design (looks/feel) may influence willingness to buy • Consumers knowledge of computers / computing may influence willingness to buy • Consumers attitude to computers may influence willingness to buy • Consumers ease with computers may influence willingness to buy Essentials of Marketing Research Kumar, Aaker, Day

23. Example – Exp. Designs • Carnival Cruise Lines known for its “party” image wants to attract the family crowd and makes a new commercial showing good, clean fun for families. • Assume we want to measure the impact of the commercial on a subject’s attitude to Carnival Cruise lines • Basic experimental design: X O Essentials of Marketing Research Kumar, Aaker, Day

24. Some problems with the X O design • Subject’s pre-existing attitude towards Carnival CL may have influenced the subject (History effects) • The subject may have matured since the manipulation (Maturation effects) – especially important for quasi-experiments • Some subjects may be afraid of sailing and water (Selection effects) Essentials of Marketing Research Kumar, Aaker, Day

25. An improvement over the X O design • O X O • Which effects have been controlled? • History effects • Continued Problems • The subject may have matured between the two observations (Maturation Effects) – important in quasi experiments • Some subjects still afraid of water (selection effects) Essentials of Marketing Research Kumar, Aaker, Day

26. An improvement over the OXO design • O X O O O • Which additional effects have been controlled here? • Maturation effects • Continued Problems • Selection effects: the subjects in one group may be more afraid of water than the other group Essentials of Marketing Research Kumar, Aaker, Day

27. More improvement… • Further improvement O X O RA O O • Random Assignment (RA) neutralizes selection effects • The design now controls history, maturation and selection effects Essentials of Marketing Research Kumar, Aaker, Day

28. Lenovo Case • What experimental design best controls for the PRE’s? • RA • Design now controls for History, Maturation and selection effects O1 X O1 Laptop with Think Pad logo O2 X O2 Laptop with new logo Oc Oc Laptop with no logo Essentials of Marketing Research Kumar, Aaker, Day

29. Exploratory/Descriptive/Causal? Choice of data collection method? • Case 1: To understand what do consumers think about BMW the brand • Case 2: To understand if Vioxx really increases the risk of heart attacks • Case 3: To understand if consumers read nutrition labels on foodstuffs Essentials of Marketing Research Kumar, Aaker, Day

30. Exploratory/Descriptive/Causal? Choice of data collection method? • Case 4: To understand if an ad has the desired effect • Case 5: To know what is the size of the coffee market in the US • Case 6: To know if the drop in prices has increased sales • Case 7: To know what people understand by “convergence of technologies” Essentials of Marketing Research Kumar, Aaker, Day