MBA Marketing Research Practice


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The objective of this presentation is to demonstrate how well we understand the marketing research practices taught by Prof. David Rice at Schulich School of Business, York University in Toronto, Canada.

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  • Seniors make up the fastest growing age group and this trend is expected to continue for the next several decades due mainly to a decrease in the fertility rate, an increase in life expectancy, and the aging of the baby boomersThis has resulted in a powerful customer segment whose members are interested in buying products and services that they believe will keep them healthy and enable them to spend their increased leisure time partaking in new and interesting pursuits. The cumulative purchasing power of this growing consumer segment is creating an incentive for companies to develop new product and add new features to existing products that will make them easier for seniors to usea relatively low household penetration rate when compared with other wealthy industrial nations
  • - Most new mobile phones are targeted towards the youth market. Customers who want a minimal service plan and plain handset to make an occasional call don’t have many options.
  • From our exploratory research of in-depth interviews...- device would still need to have other basic features that any cell phone has such as programmability of numbers and volume adjustments
  • MBA Marketing Research Practice

    1. 1. New Mobile Phone Device for the Elderly Dec. 6, 2011 1
    2. 2. Agenda1. Background2. Proposal3. Marketing Research Technique4. Features Tested in the Study5. Conjoint Analysis Results6. Simulations (‘What-if’ Analysis)7. Product Features Recommendation8. Market Segmentation Analysis9. Target Market Recommendation 2
    3. 3. Background• July 2011: Japanese cell phone manufacturer, Kyocera, launched the “Mi-Look” in Japan  cell phone specifically designed for the elderly  GPS tracking system, movement sensor , emergency buzzer & notification system  highly visible large font sizes and easy to use color- coordinated buttons  Changing social conditions in Japan have created a need for this type of product - 23% of the total population over the age of 65 3
    4. 4. Background• Similar changing social conditions here in Canada  In 2006, a record 14% of the total population was over the age of 65  Seniors make up the fastest growing age group• High growth potential in the Canadian mobile phone market  The value of the mobile phone market increased by 16% from 2005 to 2009  The % of Canadian households that have mobile phones increased from 64% in 2005 to 79% in 2009 4
    5. 5. Proposal• We are proposing the introduction of a new mobile cell phone device for the elderly, similar to the Mi-Look  Mobile phones have become increasingly complex  Elderly people, especially those who live on their own, should be able to stay connected with their families/friends 5
    6. 6. Market Research Technique• To determine the optimal product with the best features/attributes, we used the conjoint analysis technique  A complete profile of 16 potential products (cards) was shown 1 at a time to respondents in a survey  Respondents were asked to rate their likelihood of purchase on a scale of 1 to 7• To determine our target market, we conducted a segmentation analysis  11 demographic type questions were asked at the conclusion of the survey• We conducted mall intercepts in order to administer the survey  a sample of 560 was received 6
    7. 7. Product Features Tested in the Study Features LevelsGPS Tracking Yes/NoEmergency Notification Buzzer Yes/NoMovement Sensor Yes/NoButton Type Keyboard Type/Touch ScreenBattery Life 18 hours/24 hoursVoice Recognition Yes/NoCall Functions Automatic answer with speakerphone/Must be physically answeredPrice $200/$250/$300 7
    8. 8. Conjoint Analysis Results Utilities• A measure of the relative value or worth that consumers place on a feature and level Feature Highest Utility Placed on... GPS Tracking Having GPS capabilities Emergency Notification Having an Emergency Notification Buzzer Buzzer Movement Sensor Having a Movement Sensor Button Type Having a Touch Screen Battery Life 24 hours (as battery life goes up, utility goes up) Voice Recognition Having Voice Recognition Call Functions Automatic answer with speakerphone Price $200 (as price goes up, utility goes 8 down)
    9. 9. Conjoint Analysis Results Importance Values• A larger range of utilities means that customers put more value on that feature Importance Values gps 22.3 emergency 13.9 movement 10.6 buttons 8.7 voice 9.6 call 9.3 battery 7.5 price 18.1• Higher value was given to those features that can ensure safety (GPS, emergency, movement) rather than those that are more there to make 9 the device “fancy” (buttons, voice, call)
    10. 10. Conjoint Analysis Results• A mean was calculated for each card  The card with the highest mean of 5.4 was: GPS Tracking: Yes Emergency Notification Buzzer Strap: Yes Movement Sensor: Yes Button Type: Keyboard type Battery Life: 18 hours Voice Recognition: Yes Call Functions: Automatic answer with speakerphone Price: $200• These combinations of features are not feasible at a price point of $200  this is the “Ideal” product choice• Therefore, simulations must be conducted to determine how changing different features of the device will affect demand – share-of- preference is calculated 10
    11. 11. Simulations (“What-If”) Analysis Base Case : Mid-Priced, Mid-FeaturedFeatures Base CaseGPS Tracking NoEmergency Notification YesMovement Sensor YesButton Type KeyboardBattery Life 18 hoursVoice Recognition NoCall Functions Physically AnsweredPrice $250 11
    12. 12. Simulations (“What-If”) Analysis Which single features increase demand? Share-of-prefernece % for Changes to a Single Feature Base Case 50% Call Functions 52.8% (+2.8%) Movement Sensor 47.4% (-2.6%)Emergency Notification Buzzer 47.4% (-2.6%) Battery Life 50.2% (+0.2%) Yes Button Type 50.7% (+0.7%) to No Voice Recognition 52.9% (+2.9%) GPS 59% (+9%) 0 10 20 30 40 50 60 70 • GPS increases demand most!! 12
    13. 13. Simulations (“What-If”) AnalysisWhich multiple combinations of features increase demand? • GPS + Touch Screen  Increases demand significantly • GPS + $300  People will pay more for the GPS capability • Voice Recognition + $300 People will pay more for the voice recognition function • Movement Sensor + $200 People prefer price that is $100 less vs. movement sensor function • Call Functions + $200  People prefer automatic answer function vs. a price that is $100 less 13
    14. 14. Simulations (“What-If”) Analysis Alternatives: Features Alternative 1 Alternative 2 Alternative 3 Premium Base Case Cost Leadership GPS Tracking Yes No Yes Emergency Yes Yes No NotificationMovement Sensor No Yes No Button Type Touch Screen Keyboard Touch Screen Battery Life 18 hours 18 hours 18 hoursVoice Recognition Yes No No Call Functions Automatic Physically Physically with Answered Answered speakerphone Price $300 $250 $200 14
    15. 15. Product Features Recommendation Features Alternative 1 • Market is not saturated Premium • Higher potential than in GPS Tracking Yes Emergency Yes Japan Notification • Create new niche marketMovement Sensor No • The features are consistent Button Type Touch Screen Battery Life 18 hours with the findings of theVoice Recognition Yes analysis Call Functions Automatic with speakerphone • Capture a large market share Price $300 • Charge the premium price 15
    16. 16. Market Segmentation AnalysisWhich group is more likely to purchase? • Men vs. Women?  There is no significant difference •1 or 2 person household vs. 3 or more person households?  1 or 2 person household – slightly • Young (<35) vs. Older (>35)?  Older people – slightly • Single vs. Married/common law?  Single people – slightly • Has an elderly person in their lives vs. does not?  With an elderly – tremendously • With elderly caregiver experience vs. with none?  With experience - moderately 16
    17. 17. Market Segmentation AnalysisWhich group is more likely to purchase? • Income: Low vs. Mid vs. High • Household: Small vs. Medium vs. Large • Age: Young vs. Mid-aged vs. Old 17
    18. 18. Market Segmentation AnalysisWhich group is more likely to purchase? • Income: Low (<$20K) vs. Mid vs. High Most Likely No Difference • Household: Small (1-2) vs. Medium vs. Large Most Likely No Difference • Age: Young vs. Mid-aged vs. Old (55+) No Difference Most Likely 18
    19. 19. Market Segmentation AnalysisWho are more likely to be what? Who Likely to1 Men Women Have caregiving experience2 Single Married Have caregiving experience3 Young Old Have a smartphone Have an elderly person in their4 Young Old lives 19
    20. 20. Target Market RecommendationRecommendation  Young people (less than 35) are more likely to have a smart phone  + older people are more likely to purchase the product  + don’t necessarily have a smart phone themselves = the device should be as simple and easy to use as possiblePrimary target: 35+ and FemaleSecondary target: People with caregiver experience 20
    21. 21. Thank You!Questions? 21