Ii mm.04.10


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Ii mm.04.10

  1. 1. Marketing Management MBA CP 205
  2. 2. Conducting Marketing Research
  3. 3. <ul><li>Learning Objectives: </li></ul><ul><li>Know what constitutes good marketing research. </li></ul><ul><li>Know what are good metrics for measuring marketing productivity. </li></ul><ul><li>Know how companies can more accurately measure and forecast demand. </li></ul>Conducting Marketing Research
  4. 4. Conducting Marketing Research Marketing Research Market research may be defined as the systematic design, collection, analysis and reporting of data and findings relevant to a specific marketing situation facing the company.
  5. 5. Conducting Marketing Research Markets Market research Market entry strategy Product strategy Pricing strategy Distribution strategy Communication strategy
  6. 6. Types of Marketing Research firms Conducting Marketing Research Syndicated- service Custom Specialty- line
  7. 7. The Marketing Research Process Conducting Marketing Research Define the problem Develop research plan Collect information Analyze information Present findings Make decision
  8. 8. <ul><li>Step one: </li></ul><ul><li>Define the problem: The problem should not be defined too narrowly or too broadly. </li></ul><ul><li>Specify the decision alternatives: The purpose of research is to generate meaningful information that will help in taking effective decisions. </li></ul><ul><li>State research objectives: The marketing researcher should then set specific objectives of the study. </li></ul>Conducting Marketing Research
  9. 9. Step Two: Data Sources Contact Methods Research Instruments Sampling Plan Research Approaches Research Plan Conducting Marketing Research
  10. 10. Research approaches: Observation Focus Group Survey Behavioral Data Experimentation Conducting Marketing Research
  11. 11. A focus group in session with marketing people observing through a one way mirror Conducting Marketing Research
  12. 12. Research Instruments Conducting Marketing Research <ul><li>Questionnaires </li></ul><ul><li>Qualitative Measures </li></ul><ul><li>Mechanical Devices </li></ul>
  13. 13. Questionnaire Dos and Don’ts <ul><li>Ensure questions are free of bias </li></ul><ul><li>Make questions simple </li></ul><ul><li>Make questions specific </li></ul><ul><li>Avoid jargon </li></ul><ul><li>Avoid sophisticated words </li></ul><ul><li>Avoid ambiguous words </li></ul><ul><li>Avoid negatives </li></ul><ul><li>Avoid hypotheticals </li></ul><ul><li>Avoid words that could be misheard </li></ul><ul><li>Use response bands </li></ul><ul><li>Use mutually exclusive categories </li></ul>Conducting Marketing Research
  14. 14. <ul><li>Question types: </li></ul><ul><li>Dichotomous: A question with two possible answers. </li></ul><ul><li>In arranging this trip, did you personally phone Air India? </li></ul><ul><li>Yes No </li></ul><ul><li>Multiple choice: A question with three or more answers. </li></ul><ul><li>Likert scale: A statement with which the respondent shows the amount of agreement/disagreement. (Scale 1-5). </li></ul><ul><li>Semantic differential: A scale connecting two bipolar words. The respondent selects the point that represents his or her opinion. </li></ul>Conducting Marketing Research
  15. 15. <ul><li>Importance scale: A scale that rates the importance of some attribute. </li></ul><ul><li>Rating scale: A scale that rates some attribute from ‘poor’ to ‘excellent’. </li></ul><ul><li>Intention to buy scale: A scale that describes the respondent’s intention to buy. </li></ul><ul><li>Completely unstructured: A question that respondents can </li></ul><ul><li>answer in an almost unlimited number of ways. </li></ul><ul><li>Sentence completion: An incomplete sentence is presented and respondents complete the sentence. </li></ul>Conducting Marketing Research
  16. 16. <ul><li>Story completion: An incomplete story is presented, and the respondents are asked to complete it. </li></ul><ul><li>Picture: A picture of two characters is presented, with one making a statement. Respondents are asked to identify with the other and fill in the empty call out. </li></ul><ul><li>Thematic Apperception Test (TAT): A picture is presented and respondents are asked to make up a story about what they think is happening or may happen in the picture. </li></ul>Conducting Marketing Research
  17. 17. Qualitative measures Shadowing Behavior mapping Consumer journey Camera journals Extreme user interviews Storytelling Unfocused groups Conducting Marketing Research
  18. 18. <ul><li>Qualitative measures </li></ul><ul><li>Shadowing: Observing people using products, shopping, visiting hospitals or using cell phones. </li></ul><ul><li>Behavior mapping: Photographing people within a space, say a hospital waiting room, for two/three days. </li></ul><ul><li>Consumer journey: Keeping track of all the interactions a consumer has with a product, service, or service. </li></ul>Conducting Marketing Research
  19. 19. <ul><li>Camera journals: Asking consumers to keep visual diaries of their activities and impressions relating to a product. </li></ul><ul><li>Extreme user interviews: Talking to people who really know – or know nothing – about a product and evaluating their experience using it. </li></ul><ul><li>Story telling: Prompting people to tell personal stories about their consumer experiences. </li></ul><ul><li>Unfocused group: Interviewing a diverse group of people. </li></ul>Conducting Marketing Research
  20. 20. Mechanical devices Galvanometers Techistoscope Eye cameras Audiometers Conducting Marketing Research
  21. 21. <ul><li>Mechanical devices </li></ul><ul><li>Galvanometers : To measure the interest or emotions aroused by exposure to a specific ad or picture. </li></ul><ul><li>Techistoscope: It flashes an ad to a subject with exposure interval of 1/100 th of a second to several seconds. After every exposure the respondent describes what he/she recalls. </li></ul><ul><li>Eye cameras: These study the respondents eye movements to see where the eyes land first, how long they linger on an item. </li></ul><ul><li>Audiometers attached to TVs can record when the set is on and to which channel it is tuned in. </li></ul>Conducting Marketing Research
  22. 22. <ul><li>Sampling Plan </li></ul><ul><li>It calls for three decisions </li></ul><ul><li>Sampling unit: who is to be surveyed? </li></ul><ul><li>Sample size: How many people should be surveyed? Large samples give more reliable results. </li></ul><ul><li>Sampling procedure: How should the respondents be chosen? </li></ul><ul><li>Probability (simple random, stratified random or cluster area) or Non-probability (convenience, judgment or quota) samples. </li></ul>Conducting Marketing Research
  23. 23. Contact methods: Mail Questionnaires Personal Interview Telephone Interviews Online Interview Conducting Marketing Research
  24. 24. <ul><li>The data collection phase of the market research is the most expensive and the most prone to error. </li></ul><ul><li>Analyzing the information involves extracting findings from the collected data. </li></ul><ul><li>The concluding steps are presenting the findings and making the decision. </li></ul><ul><li>Marketing decision support system (MDSS) is being used increasingly to make better decisions. </li></ul>Conducting Marketing Research
  25. 25. Measuring Marketing Productivity Conducting Marketing Research Marketing Metrics <ul><li>Internal </li></ul><ul><li>Awareness of goals </li></ul><ul><li>Commitment to goals </li></ul><ul><li>Active support </li></ul><ul><li>Resource adequacy </li></ul><ul><li>Staffing levels </li></ul><ul><li>Desire to learn </li></ul><ul><li>Willingness to change </li></ul><ul><li>Freedom to fail </li></ul><ul><li>Autonomy </li></ul><ul><li>External </li></ul><ul><li>Awareness </li></ul><ul><li>Market share </li></ul><ul><li>Relative price </li></ul><ul><li>Number of complaints </li></ul><ul><li>Customer satisfaction </li></ul><ul><li>Distribution </li></ul><ul><li>Total number of customers </li></ul><ul><li>Loyalty </li></ul>
  26. 26. Tools to measure Marketing Plan Performance Sales Analysis Financial Analysis Marketing Expense to Sales Analysis Market share Analysis Conducting Marketing Research
  27. 27. Sales Analysis Conducting Marketing Research Micro- Sales Analysis Sales- Variance Analysis
  28. 28. <ul><li>Sales analysis involves comparing actual sales in relation to goals. </li></ul><ul><li>Two specific tools are used: Sales variation analysis and Microsales </li></ul><ul><li>analysis . </li></ul><ul><li>Sales variation measures relative contribution of various factors to a </li></ul><ul><li>gap in sales performance. </li></ul><ul><li>Microsales analysis looks at specific products, territories that failed </li></ul><ul><li>to produce expected sales. </li></ul><ul><li>Market share can be measured in three ways: Overall market share , </li></ul><ul><li>Served market share and Relative market share . </li></ul>Conducting Marketing Research
  29. 29. <ul><li>One way to analyze market share movements is in terms of four </li></ul><ul><li>components. </li></ul><ul><li>Overall Market share is product of Customer penetration , </li></ul><ul><li>Customer loyalty , Customer selectivity and Price selectivity . </li></ul><ul><li>Customer penetration: Percentage Customers who buy from the </li></ul><ul><li>company. </li></ul><ul><li>Customer loyalty: Purchases from the company by its customers </li></ul><ul><li>expressed as a percentage of their total purchases from all </li></ul>Conducting Marketing Research
  30. 30. <ul><li>all suppliers of the same products. </li></ul><ul><li>Customer selectivity: Size of the average customer purchase from </li></ul><ul><li>the company expressed as a percentage of the size of the average </li></ul><ul><li>customer purchase from an average company. </li></ul><ul><li>Price selectivity: Average price charged by the company expressed </li></ul><ul><li>as a percentage of the average price charged by all companies. </li></ul><ul><li>Marketing expense to sales analysis involves making sure that the </li></ul><ul><li>company is not over spending to achieve its marketing goals. It </li></ul><ul><li>requires monitoring sales force to sales, advertising to sales, sales </li></ul><ul><li>promotion to sales, marketing research to sales and sales </li></ul><ul><li>administration to sales ratios. </li></ul>Conducting Marketing Research
  31. 31. . . . . . India Ninety Types of demand Measurement (6X5X3) Conducting Marketing Research Forecasting Demand
  32. 32. The measures of Market Demand Potential Market Penetrated Market Target Market Available Market Conducting Marketing Research Forecasting Demand
  33. 33. <ul><li>Potential market , set of consumers who have sufficient interest in </li></ul><ul><li>the market offer. However, it is not enough to define a market. </li></ul><ul><li>Available market , set of consumers who have sufficient interest, </li></ul><ul><li>income and access to a particular offer. </li></ul><ul><li>Target market , part of the available market the company decides </li></ul><ul><li>to pursue. </li></ul><ul><li>Penetrated market , set of consumers who are buying the </li></ul><ul><li>company’s product. </li></ul>Conducting Marketing Research
  34. 34. <ul><li>The key concepts in demand measurement are market demand and </li></ul><ul><li>company demand . Within each, one has to distinguish among a </li></ul><ul><li>demand function , a sales forecast and a potential . </li></ul><ul><li>Market demand for a product is the total volume that would be </li></ul><ul><li>bought by a defined customer group in a defined geographical area, </li></ul><ul><li>time period, marketing environment and under a marketing plan. </li></ul><ul><li>Market demand is not a fixed number but is a function of stated </li></ul><ul><li>conditions. These may include industry marketing expenditures in a </li></ul><ul><li>given time period. Thus it can be called a demand function . </li></ul>Conducting Marketing Research
  35. 35. Market Demand Function Conducting Marketing Research
  36. 36. Market Demand Function Conducting Marketing Research
  37. 37. <ul><li>Only one level of industry marketing expenditure will occur. The </li></ul><ul><li>demand corresponding to this level is called the market forecast . It </li></ul><ul><li>shows expected market demand. </li></ul><ul><li>The market potential is the limit approached by market demand as </li></ul><ul><li>industry expenditures approach infinity for a given marketing </li></ul><ul><li>environment. </li></ul><ul><li>Distinction must be made between the position of the market </li></ul><ul><li>demand function and movement along it. The position depends on </li></ul><ul><li>the marketing environment. Particular location on the demand </li></ul><ul><li>function depends on the expenditure company decides to incur. </li></ul>Conducting Marketing Research
  38. 38. <ul><li>Company demand is the company’s estimated share of market </li></ul><ul><li>demand at alternative levels of company marketing effort in a given </li></ul><ul><li>time period. </li></ul><ul><li>The company’s share of market demand depends on how its </li></ul><ul><li>products, services, prices and communications are perceived by </li></ul><ul><li>consumers relative to the competition. </li></ul><ul><li>If other things are equal, the company’s market share will depend </li></ul><ul><li>on the size and effectiveness of the of its marketing expenditures </li></ul><ul><li>relative to competitors. </li></ul>Conducting Marketing Research
  39. 39. <ul><li>The marketer’s next task is to choose a level of marketing effort. </li></ul><ul><li>The company Sales forecast is the expected level of company sales </li></ul><ul><li>based on a chosen marketing plan in a given marketing </li></ul><ul><li>environment. </li></ul><ul><li>Sales quota is the sales goal set for a product line, company division </li></ul><ul><li>or a sales representative. It is a managerial tool to stimulate sales </li></ul><ul><li>effort and is usually set slightly higher than sales forecast. </li></ul><ul><li>Company sales potential is the sales limit approached by company </li></ul><ul><li>demand as company marketing effort increases relative to that of </li></ul><ul><li>competitors, the absolute limit being market potential. </li></ul>Conducting Marketing Research
  40. 40. <ul><li>Recap: </li></ul><ul><li>Know what constitutes good marketing research. </li></ul><ul><li>Know what are good metrics for measuring marketing productivity. </li></ul><ul><li>Know how companies can more accurately measure and forecast demand. </li></ul>Conducting Marketing Research