RELEVANCE & SCOPE OF RESEARCH IN MANAGEMENT Definition of Marketing Research: “ Systematic design, collection, record, analysis and reporting of data for aid in making business decisions.”
Literally Research means to “search again”. It connotes scientific investigation wherein the researcher takes another, more careful look at the data to discover all that can be known about the subject of study
If information generated or data collected and analyzed are to be accurate, researcher must have an objective, without engaging in a biased attempt to prove preconceived ideas.
Objective is to facilitate the managerial decision making process for all aspect of business: Finance, Marketing, Personal and so on.
RELEVANCE & SCOPE OF RESEARCH IN MANAGEMENT …contd
RELEVANCE & SCOPE OF RESEARCH IN MANAGEMENT …contd Who constitutes the buyers ? Why do some people buy and some don’t? What are the market share of the respective brands? Market & Sales Research From which outlet are the product bought ? What drives a consumer to buy a brand ? Which alternative packaging is most preferred ? What features /attributes of product is important Product Research 3 suresh
RELEVANCE & SCOPE OF RESEARCH IN MANAGEMENT …contd What are the responses to various price levels ? To what extent is sales affected by price? What pricing policy should be adopted for new product introduction ? Price Research Which is the most effective advertising mix ? How successful are discounts coupons, lucky draws ? What advertising theme, appeal, slogan to use ? Promotion(Advertising) Research What product features should be emphasized ? 4 suresh
RELEVANCE & SCOPE OF RESEARCH IN MANAGEMENT …contd What channels should be used ? What type of stores display the product and in what quantity? Where and what volumes should the product be stocked ? Place (Distribution) Research
RELEVANCE & SCOPE OF RESEARCH IN MANAGEMENT …contd Four stages of decision making process: Identifying problems or Opportunities: Organization must determine where it wants to go and how it will get there. E.g.: Develop package for a new brand Increase the amount of repeat purchasing Allocate advertising budget geographically. Diagnosing and assessing problems or opportunities: Manager need to gain insights about the underlying factors causing the situation Selecting and implementing a course of action: Research is often conducted to obtain specific information that will aid in evaluating the alternatives and in selecting the best course of action 6 suresh
RELEVANCE & SCOPE OF RESEARCH IN MANAGEMENT …contd Evaluating the course of action: Objective measurement and the appraisal of extent to which a given activity, project or program has achieved its objective 7 suresh
RELEVANCE & SCOPE OF RESEARCH IN MANAGEMENT …contd Determining when Research should be conducted: Time Constraint Availability of Data Nature of decision Benefit v/s cost Is sufficient time available before managerial decision must be made ? Is the information already on hand, inadequate for making the decision ? Is the decision of considerable strategic or tactical importance ? Does the value of the research information exceed the cost of conducting Research ? YES YES YES YES NO NO NO NO Research should not be conducted Conduct Research 8 suresh
STEPS INVOLVED IN THE RESEARCH PROCESS Decision making: Process of resolving a problem or choosing among alternative opportunities . Decision making situation ranges from complete certainty to absolute ambiguity Complete Certainty Uncertainty Absolute Ambiguity
Decision maker has all the information and exact nature of business problem.
Research may be a waste of time, however can be attractive for decision makers
STEPS INVOLVED IN THE RESEARCH PROCESS …contd Problem discovery Problem discovery and definition Selection of exploratory research technique Experience survey Case study Secondary (historical data) Pilot study Problem definition (statement of research objective) Planning the research design Selection of basic research method Secondary data study Observation Survey Experiment 10 suresh
STEPS INVOLVED IN THE RESEARCH PROCESS …contd Sampling Selection of sample design Nonprobability sampling Probability sampling Collection of data (fieldwork) Data gathering Editing and coding data Data processing and analysis Data processing and analysis Interpretation of findings Drawing conclusion and preparing report Report 11 suresh
Problem discovery Problem definition (statement of research objective) “The formulation of a problem is often more essential than its solution” - Albert Einstein Introduce new product Design a test market to assess the likely acceptance of the new product Adopt pricing strategy for a new product Assess the potential levels of demand associated with various price levels General statement Specifically identified Develop package for a new product Evaluate effectiveness of alternate package design Allocate advertising budget geographically Determine current level of market penetration in the respective areas 12 suresh
Eg. What are the10 most important variable consumers use to decide while buying TV? (ABSOLUTE AMBIGUITY)
* Degree of uncertainty of a research problem determines the research methodology 13 suresh
Selection of exploratory research technique Secondary (historical data) 14 suresh Data gathered and recorded by someone else prior to the current needs of the researcher. Secondary data are usually historical.
Objective for Secondary data:
Fact Finding: Eg. Sales, Market share of a product.
Population, age, gender (Census data)
Model Building: Specifying relationship between two or more variables.
Eg. Used to estimate growth, inflation for financial research Used to calculate market potential (population X per capita income)
Selection of exploratory research technique Secondary (historical data) 15 suresh …contd
Classification of Secondary data:
Internal and Proprietary data: E.g.. Purchase/sales volume of products for a Shopping Mall
Books and Periodicals: E.g.. Journal of Marketing research, Business week, Financial Analyst journal
Government Sources: E.g.. Census Data (No. of members in family, gender, age etc). Economic data series like GDP, balance of Payment
Regional Publications: E.g.. Publications generated by different banks
Metro political planning agencies of the city provides about population, economies, transportation
Selection of exploratory research technique Secondary (historical data) 16 suresh …contd
Classification of Secondary data:
Media Sources: E.g.. TV channel viewership data
Market Share data: Retail sales volume data based on product movement.
Consumer attitude and public opinion research: Syndicated service for report findings from attitude research and opinion poll
Selection of exploratory research technique Pilot study 17 suresh Pilot study generates primary data usually for qualitative analysis. It serve as a guide for the larger study. Include focus group interviews, projective techniques and depth interviews
Focus Group Interview (FGD):
Selection of exploratory research technique Pilot study 18 suresh …contd
Focus Group Interview (FGD):
Moderator (interviewer) and 6-10 participants.
Moderator introduces the topic and encourages the group members to discuss.
Often used for concept and refinement . (E.g.. New name or attribute for a product)
Videoconferenced focus group allows managers to send messages to moderator
Quickly analyzed and less expensive, however small discussion group will rarely be representative sample.
Selection of exploratory research technique Pilot study 19 suresh …contd
Projective Techniques: Questioning that enable to “project” belief and feeling of a person onto a third party, which otherwise is not expressed. Objective is to discover an individual’s attitude, motivation.
Word Association: Frequently used in testing potential brand names.
Sentence Completion: Respondents are required to complete a number of partial statements. E.g.:
High salary will help me purchasing ___________________ Brand A is better than B because_____________________
Selection of exploratory research technique Pilot study 20 suresh …contd
Respondents are asked why a third person (e.g. a neighbor) does what he does or thinks what he thinks about a brand, company or a concept. (Providing a mask is a basic idea)
Thematic Apperception Test (TAT): Consist of pictures or cartoon in which the Research topic is centre of attention
Selection of exploratory research technique Pilot study 21 suresh …contd Respondent to tell what's happening in the picture and what the people might do next
Selection of exploratory research technique Pilot study 22 suresh …contd Or respondent to construct a story looking at series of pictures with continuity
Selection of exploratory research technique Pilot study 23 suresh …contd
Interview is extensive, unstructured and undisguised (not direct questions).
Respondent is free to respond the way he/she likes
Interpretation of such data is highly subjective
Selection of exploratory research technique Experience survey 24 suresh
Issues and ideas are discussed with those having experience in subject on which Research is being done.
Interview is done with small no. of knowledgeable people.
The purpose is to help formulate the problem and clarify the concept.
Exploratory information from an Experience survey is not expected to be conclusive.
Selection of exploratory research technique Case study 25 suresh
Purpose is to obtain information from one or a few situation that are similar to researcher’s problem situation.
Selection of descriptive/ causal research Survey 26 suresh Defined as a method of gathering primary data based on communication with representative sample. Most surveys are descriptive but they can be also be designed to provide causal explanation Ways to carry out a Survey:
Door-to-Door Personal Interview: Personal interview conducted at the respondents home or the place of business
Mall Intercept Personal Interview: Personal interview conducted in shopping malls
Telephone Interviews: Contacting respondents by telephone to gather responses to survey questions.
Mail Survey: A self-administered questionnaire sent through the mail to respondent.
Internet Survey: A self-administered questionnaire posted on a web site
Selection of descriptive/ causal research Survey suresh Mall Intercept PI Mail Survey Door to Door PI Telephone Interview Interview Survey Slow Speed of data collection Instantaneous Fast Very Fast Moderate Moderate Varies Moderate to Low Good Respondent cooperation Excellent Varies Questionnaire length Moderate Moderate to long Moderate Long High High Low Average Possibility of respondent misunderstanding Low None None High Moderate High Degree of interviewer influence on ans. Lowest Low Moderate to high Low to moderate Highest Cost 27
Selection of descriptive/ causal research Survey 28 suresh Classification of Survey on Temporal Basis Cross Sectional Studies Longitudinal Studies
Selection of descriptive/ causal research Observation 29 suresh Business Researchers can observe people, objects, events or other phenomena by assigning the task to human observer or by using machines designed for specific observation tasks.
Selection of descriptive/ causal research Observation 30 suresh Human behavior or action Selection of products from a shelf Verbal behavior Communication of an employee with subordinates and boss Expressive behavior Facial expression, tone of voice while seeing demo of a consumer durable Temporal patterns Time taken to complete a task Physical patterns Footfall recorded in a shopping mall on weekend Verbal and pectoral record Number of illustrations in a text book
Selection of descriptive/ causal research Observation 31 suresh
Television Monitoring: Eg. ‘PeopleMeter’ used to obtain ratings of television program.
Monitoring website traffic: Recording no. of people visiting a particular website
Eye tracking monitor: Measures unconscious eye movement, used in recording the pattern of a hoarding or print ad being noticed
Voice Pitch analysis: Measures emotional reaction as reflected in physiological changes in persons voice
Optical scanner and bar codes: Used in providing sales information for particular a product
Selection of sample design 32 suresh Sampling: The process of using a small number of items or part of a large population to make conclusion about the whole population. Sampling Probability Non Probability Technique in which units of sample are selected on the basis of personal judgment or convenience. Types:
Simple random: Each possible sample has an equal probability of being included in the sample. Each member of sample is assigned a number and sample unit is selected by random method.
Eg. Random digit dialing for Telephone interviews or random selection of respondents from census data.
Systematic: Elements are selected from population at a uniform interval that is measured in time or order.
Eg. Mall Intercept PI conducted every Wednesday in Bigbazaar or 2 houses skipped after every door to door interview.
Selection of sample design Probability 34 suresh
Stratified: Population divided into relatively homogeneous group, called strata. From each stratum, a specified no. of elements corresponding to the proportion of that stratum in the population is selected by simple random sampling. Eg. Out of an entire population of 50,000 of an area, if people from age group 20-24 yrs are 10,000, then after a sample of, say 200 is achieved by simple random sampling, the number people between that age group will be more or less 40.
Cluster: Population is divided into groups or cluster. Eg. Survey to be conducted in North and West.
*In Stratified, each group has small variation within itself but wide variation between groups. There is considerable variation within each group but the groups are similar to each other.
Selection of sample design Non Probability 35 suresh
Quota: Various subgroup in a population are represented by sample to the exact extent that the researcher desires. Eg. Out of an entire population of 50,000 of an area, if people from age group 20-24 yrs are 10,000, then
a Quota of 40 people should be achieved in that age group if the sample size is selected as 200. Purpose is to ensure various subgroups in a population are represented by the sample. Quota sampling have a tendency to include people who are easily found within the Quota (unlike Stratified in which strata are formed and people are selected by simple random sampling)
Selection of sample design Non Probability 36 suresh
Judgment/purposive : Experienced researcher selects the sample based on his/her judgment about some characteristics required of the sample member. Eg. For a telecom company study, the proportion of people to be studied for a sample of 1000 are:
600 (60%) those who presently use company’s sim card 250 (25%) those who have never used company’s sim card 150 (15%) those who switched after using company’s sim card The above proportion of sample may be less than fully representative of population
Selection of sample design Non Probability 37 suresh
Convenience : Refers to sampling by obtaining people who are most conveniently available. Eg. News reporters present reviews of a movie from people coming out of theatre, who are presumed to reflect public opinion
Snowball : Sampling procedure in which initial respondents are selected by probability method and additional respondents are obtained from information provided by the initial respondents.
Types of question 38 suresh
Open-ended and Closed-ended :
What do u like about Surf detergent: Cleaning power Fragrance Dissolve easily Any other (please specify)______________
Dichotomous Questions: Two alternatives given to choose
Ranking: Rank the following brand on their ability to clean clothes: (1=best, 2=next best etc.)
Scales used in questionnaire 41 suresh Scales Nominal Ordinal Scale Interval Ratio Variables used to compute statistical measures (avg, std deviation)
1.Rating given to attributes of products
1. Mode 2. Median 3. Mean 4. Std deviation
Test of Significance:
1. z-test 2. t-test 3. F-test Number are only used as labels
1.Bank Account No. 2.No. of element in each category
1. Mode 2. No. of element in each category
Test of Significance:
Chi Square All arithmetic operations are possible on a ratios scale.
1.Age 2. Income 3. Weight
1. Mode 2. Median 3. Mean 4. Std deviation
Test of Significance:
All Variable have meaningful orders
1.Ranking of products
1. Mode 2. Median 3. Percentile
Test of Significance:
1. Non parametric statistical test 2. Sign test
CASE 42 suresh Background Rockledge Corporation shows its presence in various sectors: Steel, Telecom, Banking, and Automobile. The company has decided to diversify its portfolio by getting in Consumer durable sector, beginning with manufacturing of TV. Need Entering in TV industry
Analyzing competition on various parameters….contd
Testing data by Anova at 5% significance level, there is a significant difference in rating given to brands for “Latest Model”. No significant difference shown on Further analysis of Sony and Samsung on mean rating given for “latest Technology” at 5% significance, using 2 sample hypothesis concept