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CAPTURING

PART. CAPTURING. 2. MARKETING INSIGHTS. Chapter. CONDUCTING. 4. Marketing Research and Forecasting Demand. In this chapter, we address the following questions:. What constitutes good marketing research? What are good metrics for measuring marketing productivity?

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CAPTURING

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  1. PART CAPTURING 2 MARKETING INSIGHTS Marketing Management - An Asian Perspective 4th Edition

  2. Chapter CONDUCTING 4 Marketing Research and Forecasting Demand Marketing Management - An Asian Perspective 4th Edition

  3. In this chapter, we address the following questions: • What constitutes good marketing research? • What are good metrics for measuring marketing productivity? • How can marketers assess their return on investment of marketing expenditures? • How can companies more accurately measure & forecast demand? Marketing Management - An Asian Perspective 4th Edition

  4. Marketing Research and Forecasting Demand LG Telecom- differentiated service - each group - research on customer value & profitability Marketing Management - An Asian Perspective 4th Edition

  5. The Marketing Research System Good marketing research is characterized by scientific method, creativity, multiple research methods, accurate model building, cost-benefit analysis, a healthy skepticism & an ethical focus Marketing Management - An Asian Perspective 4th Edition

  6. The Marketing Research System 3 categories Market Research Firms • Syndicated-service • Custom marketing • Specialty-line market Other ways to conduct research • Engage students • Use the Internet • Check out rivals Marketing Management - An Asian Perspective 4th Edition

  7. The Marketing Research Process Define problem& research objective, Develop research plan, Collect information, Analyze information, Present findings to management & Make decision Marketing Management - An Asian Perspective 4th Edition

  8. Figure 4.1 The Marketing Research Process Marketing Management - An Asian Perspective 4th Edition

  9. The Marketing Research Process Step 1: Define Problem, Decision Alternatives & Research Objectives • Marketing- studies to researcher • Define problem carefully • Survey, forecast, ad evaluation • Marketing researcher - insight - customer’s attitudes & buying behavior Marketing Management - An Asian Perspective 4th Edition

  10. The Marketing Research Process Step 2: Develop the Research Plan • Develop efficient plan - gather information • Design research plan calls for: • Data sources • Research approaches • Research instruments • Sampling plan • Contact methods Marketing Management - An Asian Perspective 4th Edition

  11. The Marketing Research Process Step 2: Develop the Research Plan - DATA SOURCES Secondary data • Collected for other purpose & already exist • Low cost & ready availability Primary data • Data freshly gathered for specific purpose • Procedure - interview people – their feeling on topic - develop instrument & proceed Marketing Management - An Asian Perspective 4th Edition

  12. The Marketing Research Process Step 2: Develop the Research Plan – RESEARCH APPROACHES Primary data collected in 5 ways • Observation • Focus groups • Surveys • Behavioral data • Experiments Marketing Management - An Asian Perspective 4th Edition

  13. The Marketing Research Process A focus group Marketing Management - An Asian Perspective 4th Edition

  14. The Marketing Research Process Step 2: Develop the Research Plan – RESEARCH INSTRUMENTS • Marketing researchers - 3 main research instruments to collect primary data: • Questionnaires • Qualitative measures • Mechanical devices Marketing Management - An Asian Perspective 4th Edition

  15. Table 4.1Types of Questions Marketing Management - An Asian Perspective 4th Edition

  16. Table 4.1Types of Questions Marketing Management - An Asian Perspective 4th Edition

  17. Questionnaire Dos & Don’ts • Ensure questions - not biased • Make questions simple & specific • Avoid jargon • Avoid uncommon or ambiguous words • Avoid questions with a negative • Avoid hypothetical questions • Avoid words that could be misheard • Desensitize questions - use response bands • Ensure fixed responses don’t overlap • Allow for “other” in fixed response questions Marketing Management - An Asian Perspective 4th Edition

  18. The Marketing Research Process Step 2: Develop the Research Plan – RESEARCH INSTRUMENTS Qualitative research techniques • Unstructured measurement approaches • Range of responses Marketing Management - An Asian Perspective 4th Edition

  19. The Marketing Research Process Step 2: Develop the Research Plan – RESEARCH INSTRUMENTS Understand customer experience 7 techniques • Shadowing • Behavior mapping • Consumer journey • Camera journals • Extreme user interviews • Storytelling • Unfocus groups Marketing Management - An Asian Perspective 4th Edition

  20. Getting into Consumers’ Headswith Qualitative Research • Common qualitative research approaches: • Word associations • Projective techniques • Visualization • Brand personification • Laddering Marketing Management - An Asian Perspective 4th Edition

  21. The Marketing Research Process Step 2: Develop the Research Plan – SAMPLING PLAN After research approach & instruments, design sampling plan Decide on: 1. Sampling unit 2. Sample size 3. Sampling procedure Marketing Management - An Asian Perspective 4th Edition

  22. Table 4.2 Probability & Non-probability Samples Marketing Management - An Asian Perspective 4th Edition

  23. The Marketing Research Process Step 2: Develop the Research Plan – CONTACT METHODS Once sampling plan is determined, decide how to contact subject: • Mail Questionnaire • Telephone Interview • Personal Interview • Online Interview Marketing Management - An Asian Perspective 4th Edition

  24. Pros and Cons of Online Research Advantages • Inexpensive • Faster • People - more honest online than - personal or telephone interviews • More versatile Disadvantages • Samples - small & skewed • Prone to technological problems & inconsistencies Marketing Management - An Asian Perspective 4th Edition

  25. The Marketing Research Process Step 3: Collect the Information • Data collection – expensive, prone to error • Get right respondents - critical • Data collection improve - technology • Protect personal data of respondents Marketing Management - An Asian Perspective 4th Edition

  26. The Marketing Research Process Step 3: Collect the Information 4 surveys problems: • Respondents not home • Respondents refuse to cooperate • Respondents – biased/dishonest answers • Interviewers biased or dishonest Marketing Management - An Asian Perspective 4th Edition

  27. The Marketing Research Process Step 4: Analyze the Information • Extract findings from collected data • Tabulate & develop frequency distribution • Averages & dispersion computed - variables • Advanced statistical techniques & decision models Marketing Management - An Asian Perspective 4th Edition

  28. The Marketing Research Process Step 5: Present the Findings • The researcher present findings relevant to major marketing decisions facing management Marketing Management - An Asian Perspective 4th Edition

  29. The Marketing Research Process Step 6: Make the Decision Marketing decision support system (MDSS) Collection of data, systems, tools & techniques With software & hardware by which organization gathers & interprets relevant information from business & environment & used for marketing action Marketing Management - An Asian Perspective 4th Edition

  30. Table 4.37 Characteristics - Good Marketing Research Marketing Management - An Asian Perspective 4th Edition

  31. The Marketing Research Process Overcoming Barriers to the Use of Marketing Research • Many fail to use marketing research sufficiently or correctlyWHY? • Narrow conception of research • Uneven caliber of researchers • Poor framing of problem • Late & occasionally erroneous findings • Personality & presentational differences Marketing Management - An Asian Perspective 4th Edition

  32. The Marketing Research Process Failure to use marketing research properly led to numerous gaffes: Eg: Star Wars • Researcher predicted science fiction film fail • America - realism over science fiction • “War” in title - America would stay away • He gave information, not insight • Failed to study script - human story - against space backdrop Marketing Management - An Asian Perspective 4th Edition

  33. Marketing research in Asia challenging WHY? Unreliable/no secondary data Databases not comparable cross-nationally Poor research infrastructure Cultural differences in response Variations in research capabilities High rates of change in marketplace Marketing Research in Asia Marketing Management - An Asian Perspective 4th Edition

  34. Solutions: Sequence piloting, adapting & rollout of surveys regionally External validation of data sources Use samples on future demographic profiles Invest on research capabilities & infrastructure Marketing Research in Asia Marketing Management - An Asian Perspective 4th Edition

  35. Measuring Marketing Productivity • Marketers accountable for investments • Justify marketing expenditures Measure Marketing Productivity 2 WAYS: • Marketing metrics • Marketing mix modeling Marketing Management - An Asian Perspective 4th Edition

  36. Measuring Marketing Productivity- Marketing Metrics Marketing metrics • set of measures - to quantify, compare & interpret marketing performance • customer/company-level concerns • Eg: 3M tracks sales % from recent innovation • Processes - maximize metrics value • Measures - marketing dashboard - synthesis & interpretation Marketing Management - An Asian Perspective 4th Edition

  37. Table 4.4Sample marketing metrics Marketing Management - An Asian Perspective 4th Edition

  38. Measuring Marketing Productivity 2 scorecards - Performance & warning signals: • Customer-performance scorecard • Annual performance - customer-based measures • Stakeholder-performance scorecard • Tracks satisfaction of those with critical interest in & impact on performance Marketing Management - An Asian Perspective 4th Edition

  39. Table 4.5 Sample Customer-Performance Scorecard Measures Marketing Management - An Asian Perspective 4th Edition

  40. Measuring Marketing Productivity- Measuring Marketing Plan Performance • 4 tools to check on plan performance: • Sales analysis • Market share analysis • Marketing expense-to-sales analysis • Financial analysis Marketing Management - An Asian Perspective 4th Edition

  41. Measuring Marketing Productivity- Measuring Marketing Plan Performance SALES ANALYSIS • Measure & evaluate actual sales - goals 2 tools: • Sales-variance analysis - relative contribution of factors to gap in sales performance • Microsales analysis - products, territories that failed to produce expected sales Marketing Management - An Asian Perspective 4th Edition

  42. Measuring Marketing Productivity- Measuring Marketing Plan Performance MARKET SHARE ANALYSIS Market share measured in 3 ways: • Overall market share: • sales as % of total market sales • Served market share: • sales as % of sales to served market • always > overall market share • Relative market share: • market share in relation to largest competitor Marketing Management - An Asian Perspective 4th Edition

  43. Measuring Marketing Productivity- Measuring Marketing Plan Performance MARKET SHARE ANALYSIS Assumptions (not true/valid always): • Outside forces affect firms- same way • Performance - against average of industry • New firm- industry– each firm’s market share falls • Market share decline - deliberate - profits • Market share - fluctuate - many minor reasons Marketing Management - An Asian Perspective 4th Edition

  44. Measuring Marketing Productivity- Measuring Marketing Plan Performance Marketing Management - An Asian Perspective 4th Edition

  45. Measuring Marketing Productivity- Measuring Marketing Plan Performance MARKETING EXPENSE-TO-SALES ANALYSIS • Annual-plan control - company not overspend -achieve sales goals • Key ratio - marketing expense-to-sales • Find how & where company makes money • Abnormal fluctuations - cause for concern • Period-to-period fluctuations tracked - control chart Marketing Management - An Asian Perspective 4th Edition

  46. Figure 4.2 The Control-Chart Model Marketing Management - An Asian Perspective 4th Edition

  47. Measuring Marketing Productivity- Measuring Marketing Plan Performance FINANCIAL ANALYSIS • Find profitable strategies beyond sales • Factors - rate of return on net worth Return on net worth = return on assets x financial leverage • To improve return on net worth • Increase net profits to assets ratio • Increase assets to net worth ratio Marketing Management - An Asian Perspective 4th Edition

  48. Figure 4.3 Financial Model of Return on Net Worth Marketing Management - An Asian Perspective 4th Edition

  49. Measuring Marketing Productivity- Measuring Marketing Plan Performance FINANCIAL ANALYSIS Return on assets = profit margin xasset turnover Improve performance - HOW?2 ways: • Increase profit margin • increase sales/cut costs • Increase asset turnover • increase sales/reduce assets for given sales level Marketing Management - An Asian Perspective 4th Edition

  50. Deep financial analysis – benefits firm Determine if any product/marketing activity- expanded, reduced or removed Analyze profitability of: Products, territories, customer groups, segments, trade channels, order sizes Measuring Marketing Productivity- Profitability Analysis Marketing Management - An Asian Perspective 4th Edition

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