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Chapter 2. Marketing research. Lecture Objectives. After going through this chapter, you should be able to: Explain the role marketing research plays in decision-making in the hospitality industry Identify sources of marketing information available to hospitality organizations

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Chapter 2

Marketing research

lecture objectives
Lecture Objectives

After going through this chapter, you should be able to:

  • Explain the role marketing research plays in decision-making in the hospitality industry
  • Identify sources of marketing information available to hospitality organizations
  • Define secondary and primary data collection
  • Explain the differences between qualitative and quantitative research methods
  • Recognize how bias and sampling errors can distort marketing research findings
  • Describe how hospitality organizations conduct online research.
  • Managers are paid to make decisions.
  • The purpose of marketing research is to inform and improve decision-making by reducing uncertainty.
  • Marketing research can be defined as the systematic gathering and analysis of data to provide relevant information to aid decision-making.
  • Marketing research is a planned process.
  • Market research describes the investigation of consumer and organizational markets
  • Marketing research includes research into all the marketing mix variables and the macro (PESTE) and micro-environments.
international marketing research
International Marketing Research

Presents unique problems because of the cultural and technological differences between countries:

  • Translation difficulties
  • Variations in customer behaviour because of different cultural backgrounds
  • Variations in customers’ product knowledge
  • Difficulties in obtaining comparable samples
  • Different cultural responses to market research surveys
  • Differences in the infrastructure
marketing information systems
Marketing Information Systems
  • Hospitality managers need relevant, accurate, current and reliable information to be able to make effective decisions that will influence the future of the business.
  • Small, single-unit, owner-operated companies rely on informal approaches to data collection and interpretation.
  • Larger organizations need to develop more

sophisticated marketing information systems to ensure that corporate executives understand complex environment

  • The marketing information system helps marketers to identify trends and plan for the future
sources of information internal
Sources of information - internal
  • Internal information is held by the organization
  • Accommodation businesses hold a wealth of information about customers because of legal requirements
  • Information sources include:
    • Customer records
    • Guest history
    • Departmental reports
    • Marketing and sales reports
sources of information external
Sources of information - external

External information can be collected via the Internet and publications including:

  • International and national government organizations
  • Marketing research organizations
  • Publicly quoted companies “Annual Accounts”
  • Trade associations
  • Hospitality industry trade press
  • Financial press
  • Universities and academic publishers
secondary or desk data collection
Secondary (or desk) data collection
  • Secondary (desk) data are data that have already been collected
  • It is relatively easy to obtain secondary data since the information has already been published
  • Limitations to secondary data include:
    • data have been collected and analysed by another organization
    • some organizations may deliberately manipulate data
    • other organizations may have inadvertently introduced bias
    • information is generally available to competitors
    • secondary data and analysis can often be ‘dated’ because of the long time between carrying out the research and publishing
    • the findings
primary data collection
Primary data collection
  • Primary data consist of original information collected by an organization for a specific purpose.
  • The data have not been published before.
  • The organization conducting or commissioning the research determines the research objectives and research questions.
  • Data are collected directly to provide answers to those questions.
  • Primary research is usually more costly than the secondary research.
  • Advantages of primary research include the following:
      • The ability to frame the research questions to the needs of the organization
      • Research is current and not dated
      • Research is confidential
  • Primary data can enable a hospitality company to gain competitive advantage if competitors are not carrying out similar research.
qualitative data
Qualitative data
  • Qualitative research aims to provide a deep understanding of people’s contextualized behaviour
  • It aims to explain how and why people behave in certain ways
  • Qualitative research in hospitality uses:
    • Observation
    • in-depth interviews,
    • focus groups (also known as group discussions)
    • qualitative questions in surveys
quantitative data
Quantitative data
  • Quantitative research uses a wide range of methods to obtain and analyse numerical data
  • Quantitative research counts numbers, in terms of either volume or value. For example:
    • the number of customers, passengers, residents, diners, room nights, room occupancy;
    • restaurant unit’s sales; or a hotel chain’s room sales.
  • If data are numeric then the research is quantitative
quantitative research
Quantitative research
  • Quantitative research techniques are founded upon statistical theory
  • Correct statistical methods are required to reduce possible error and bias
  • Possible errors include:
    • Sampling errors
    • Respondent errors
    • Investigator errors
    • Administrative errors
  • In large surveys, statistical software packages are used to process the quantitative research data.
quantitative research methods
Quantitative research methods
  • exit surveys
  • mystery customer audits
  • telephone (including mobile phone) surveys
  • online surveys
  • omnibus surveys.
closed and open questions
Closed and open questions
  • Closed questions provide a number of alternative answers from which the respondent chooses one answer, for example questions about:
    • respondent’s age, sex, employment, income
  • Closed questions use a structured format which creates a data set that

can be efficiently analysed using statistical methods.

  • Closed questions are essential if a quantitative research method is used
  • Open-ended questions allow respondents to provide their own answers,
  • Examples include ‘Where would you stay tonight if this hotel was fully booked?’ and ‘How did you feel about the quality of service?’
  • Open question allows respondents to use their own words to describe their experience, feelings and opinions.
  • Qualitative research findings using open questions provide ‘rich’ data
  • Researchers usually ask a combination of both closed and open questions

and combine qualitative and quantitative analysis.

Compare Le Meridien and Malmaison in-room customer questionnaires

marketing research process
Marketing research process

There are six steps in the marketing research process:

  • Formulation of research objectives
  • Development of a research plan
  • Data collection
  • Data analysis
  • Assess the reliability and validity of data
  • Presentation of findings
online research
Online research
  • Advantages of online research include:
    • significant cost savings in the design and administration of questionnaires and discussion groups
    • the ability to accurately target surveys to current, former or potential customers.
  • Often, customers are incentivized to participate in online surveys
  • Post- consumption e-surveys provide customers with a convenient tool to give feedback on service quality and customer satisfaction.
  • Tools such as blogs and social networking sites are useful to obtain unsolicited such for customer- generated comment
  • The Internet is available to all sizes of hospitality companies.
criticisms of marketing research
Criticisms of Marketing Research
  • Academics and practitioners have criticized modern marketing research for a number of reasons
    • The focus on collecting data and performing statistical analysis, which does not provide new insights for the business or inform decision-making
    • Flawed marketing research methodologies that introduce unacceptable levels of bias or error
    • The emphasis on research stifles creativity in marketing
  • Despite these criticisms, major hospitality companies recognize the importance of marketing research and carry out extensive customer and competitor research on a continuous basis
references and further reading
References and Further Reading
  • Altinay , L. , & Paraskevas , A. ( 2008 ). Planning research in hospitality and tourism, Oxford, UK : Butterworth-Heinemann .
  • Bowie, D & Buttle, F (2011), Hospitality Marketing: Principles and Practice, Oxford, UK : Butterworth-Heinemann
  • Brown , S. ( 2001 ). Marketing: The retro revolution . Sage .
  • Chaffey , D. , Ellis-Chadwick , F. , Johnston , K. , & Mayer , R. ( 2009 ). Internet marketing: strategy, implementation and practice ( 4th ed. ). Pearson Education .
  • Daymon , C. , & Holloway , I. ( 2002 ). Qualitative research methods in public
  • relations and marketing communications . Routledge .
  • Saunders , M. K. , Thornhill , A. , & Lewis , P. ( 2009 ). Research methods for business students ( 5th ed.). Financial Times/Prentice Hall .
  • Usunier , J. C. , & Lee , J. ( 2009 ). Marketing across cultures ( 5th ed.). Financial Times/Prentice Hall .