A Decision Making Perspective on Marketing Research

1. A Decision Making Perspective on Marketing Research

2. Why study Marketing Research • Careers • Research Organizations (e.g. A.C. Nielsen, J.D. Power Associates, IRI, etc.) • Marketing & Business Consultancies (e.g. Arthur Andersen, Price Waterhouse, McKinsey & Co, etc.) • Marketing Departments of Businesses • Academia

3. Example: MR organizations in Charlotte N.C. • Leibowitz Market Research-GroupNet Charlotte • Blumenthal Qualitative Research • FacFind, Inc. • KPC Research • 20/20 Research  • Marketing Analysts, Inc.(Branch) • MarketWise, Inc. • Metromark Focus Research (Branch) • AOC Marketing Research

4. Situations where MR knowledge is essential • Your boss wants to introduce a new product and calls you for advice. • Your ad agency wants your business to buy an expensive ad campaign. • Your MR consultants present their findings about why your sales are falling. Do you accept their reasons? • Your boss wants to reduce prices and calls you for your thoughts.

5. Why study Marketing Research • Increase chances of taking the right decision • Increase confidence in your recommendations • Quantitative research: • Universal belief – numbers don’t lie

6. What is Marketing Research?Examples Pain Relievers Gentleness • Tylenol Effectiveness • Bayer • Advil • Private-label Aspirin • Nuprin • Anacin • Excedrin

7. Definition of Marketing Research • Marketing research is the • systematic (pre-planned) and objective (measurable) • identification, collection, analysis, and dissemination of information (information collected by organization from market) • for the purpose of improving decision making (providing factual basis for taking a decision) • related to the identification of opportunities and solution of problems in marketing.

8. Role of Marketing Research in Managerial Decision Making Four Stages of Market Planning Situation analysis Process Strategy development Marketing program development Implementation

9. Situation Analysis • The analysis of the environment in which the business operates • Market (sector-specific e.g. demand and supply, production, etc.) • Economy (e.g. money supply, inflation, BOP, interest rates, etc.) • Consumer and society (buyer behavior, societal trends) • Technology (obsolescence, innovations, inventions) • Legal (laws regulating business) • Political (govt. attitudes to business and specific sectors) • Natural (effect of natural resources on business) • Usually focus on trends which impact the marketing situation

10. For Toyota Motor CompanyIdentify the business environment • Depletion of oil reserves • Increasing GDP in China and India • Tough vehicle emission laws in California • Fed drops interest rates by a quarter of a point • Dow Jones rises by 100 points • Consumers prefer a hassle-free, no-bargaining car buying experience • Volatile gas prices • Breakthrough technologies in hybrid cars • Increased duties on cars imported from Europe

11. Case: Starbucks • Identify at least one aspect of the external environment Starbucks would be interested in researching: • Economic • Technological • Buyer behavior • Market • Legal

12. Situation Analysis – Common Marketing Research Questions Describing the market: • How big is the existing market? • How big is the potential market? • How fast is the market growing? • How brand loyal is the market? • What competitive products exist? • What is the supply situation in the market?

13. Situation Analysis – Common Marketing Research Questions Describing an organization’s market position: • What market share does the company hold? • What market segments exist and which do we serve? • What new emerging segments do we observe

14. Situation Analysis – Common Marketing Research Questions Describing buyer behavior: • Who are our customers? (i.e., demographic, geographic, psychographic segments) • How do buyers perceive our brand and competing brands? • What is the repurchase rate for our brand and competing brands? • How satisfied are customers with our brand? • Where do customers buy? When do they buy? Why do they buy? • How much do buyers like our brand?

15. Role of Marketing Research in Managerial Decision Making Four Stages of Market Planning Situation analysis Process Strategy development Marketing program development Implementation

16. Strategy Development Market Research Provides Information to Assist Management With Three Critical Decisions • What business should we be in? • How will we compete? • What are the objectives for the business?

17. Strategy development – Common Marketing Research Questions • What business should we be in: • What products should we offer (e.g. Why did Apple get into the music business?) • What technologies should we use (e.g. Should the TV industry go the plasma monitors way or the LCD way? BluRay discs or HD DVDs?) • What market segments should we target (e.g. BMW – families with kids or wealthy yuppies?) • What distribution channels should we use (e.g. Cars – dealerships or Internet or Walmart?)

18. Strategy development – Common Marketing Research Questions • How will we compete • How do we differentiate ourselves / our product from competition (e.g. State Farm is the “good neighbor”, Allstate puts you “in good hands”, GEICO “saves you 15% or more”?) • What attributes do consumers consider to be important (e.g. cars – fuel economy or acceleration?) • How do we compare to competition (e.g. FedEx and UPS – what are our market shares?)

19. Strategy development – Common Marketing Research Questions • What should be our business objectives • Sales / Profits • Market share • Customer satisfaction (self-survey or actual complaints) • Attitudes, etc. • Which objective is a better indicator of our health

20. Role of Marketing Research in Managerial Decision Making Four Stages of Market Planning Situation analysis Process Strategy development Marketing program development Implementation

21. Common Questions • Segmentation – which segment to target (e.g. Ferrari – should they introduce a minivan?) • Product – How should the product be positioned (Should Rolex be a premium brand or a mass market brand?) • Distribution – exclusive / mass distribution (Dell computers – should they be sold direct or even retail?) • Advertising – what appeals should be used (e.g. Axe pefumes – should they use over-the-top sex appeal in their ads?)

22. Common Questions • Personal selling – which customers should be approached personally (Customer Lifetime Value) • Price – what price should be charged (e.g. should Starbucks drop their prices?) • Branding – how can brand loyalty be increased (e.g. should Morton salt institute a customer rewards program?) • Customer satisfaction – how satisfied are our customers?

23. Role of Marketing Research in Managerial Decision Making Four Stages of Market Planning Situation analysis Process Strategy development Marketing program development Implementation

24. Common questions - Implementation • Did the marketing program achieve its objectives (e.g. did the Aflac duck campaign improve TOMR? Attitudes?) • Should the marketing program be modified, continued or terminated (e.g. The GEICO apes – should the company pull the campaign?)

25. Factors Influencing Marketing Research Decisions Yes Yes Yes Yes Availability of Data Is the information on hand inadequate? Nature of Decision Is the decision of considerable importance? Time Constraints Is sufficient time available? Benefits vs. Costs Does the value of the research exceed the cost? Conduct Marketing Research No No No No Do not conduct marketing research!