Strategic planning & marketing

MARKETING
MANAGEMENT
prashant kumar
galgotia business school
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Unit 2 (Contd.) –
Strategic Planning
&
Marketing
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Strategic Planning
• Strategic Planning involves a thorough
appraisal of the external environment
and an internal appraisal of the
corporation and its businesses.
• It involves bringing the corporation’s
ambitions to the fore, identifying its
competitive advantages, deciding the
businesses in which it should stay, the
businesses it should quit and the ones it
should enter anew.

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Why is Strategic Planning needed?
Environment keeps changing and it makes
strategic planning necessary for the business firm.
The inventor of the Walkman did not anticipate a
computer company like Apple to come up with
iPods and iTunes.

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HUL to erase 'Ice Cream' word from Kwality
Walls advertisements (Slide 1)
• India's advertising regulator has told consumer goods major
Hindustan Unilever to stop mentioning its Kwality Walls brand
as 'ice cream' in certain advertisements.
• Kwality Walls is frozen dessert, which looks and tastes like ice
cream but is made with vegetable fat and not milk fat.
• Under Indian laws, it does not qualify as ice cream.
• The consumer complaints council, the sub division of
Advertising Standards Council of India, the self-regulatory
body of advertising industry has concluded that the mention of
Kwality Walls as an ice cream is misleading.
• The advertisements in question are in the form of advertorials.

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• HUL published three print advertorials, each featuring a
celebrity talking about Kwality Walls brand.
• HUL has now agreed to replace the word 'ice cream' with
'frozen dessert' in the ads.
• The ice cream-plus-frozen desserts market in India is
estimated at about 1,700 crore, with market leader Amul
holding about 40% share.
• Other big players include Kwality Walls, Ahmedabad-based
Vadilal, NDDB's Mother Dairy and Ravi Jaipuria group's Cream
Bell.

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Questions
Q1. What are the options available with HUL
now?
Q2. What are the challenges the company might
face to sustain the consumers’ trust in the
company?
Q3. Should HUL think of making ice cream with milk
fat? What would be the strategy of HUL in
marketing such a product?
Q4. Why do you feel HUL is misleading consumers
by masquerading frozen dessert as ice cream?

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How does Strategic Planning help the firm?
• Provides direction to the firm and serves as a
road map

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• Prepares the firm to face the future

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• Enables the firm take all long-term decisions
• Lays down growth objectives of the firm and
provides strategies
• Serves as a hedge against uncertainty arising
from environmental turbulence
• Helps the firm understand trends
• Provides the best possible fit between the firm
and the environment
• Helps acquire competitive advantages
• Ensures optimum utilization of the resources
among the product market opportunities

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“Strategic decisions” vs “Administrative &
Operational decisions”
• Strategic decisions pertain to connecting with
the external environment; administrative and
operational decisions are concerned with day-to-
day operational and administrative matters.
• Strategic decisions have a long-range focus;
administrative and operational decisions accept
the firm’s businesses, products, etc, as they are.
• Strategic decisions are the responsibility of the
top management; administrative and operational
decisions are taken by the middle and lower level
management.

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Tasks involved in Strategic Planning
• Clarifying the mission of the
corporation
• Defining the business
• Surveying the environment
• Internal appraisal of the firm
• Setting the corporate objectives
• Formulating the corporate strategy

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Clarifying the mission of the corporation
What is a Mission?
The mission is an expression of the
corporate intent. It gives a clear overview of
the company’s values and ideals. It conveys
the company’s business purpose and
reason for existence. It subtly indicates the
businesses the firm will pursue and
the customer needs it will seek to
satisfy.

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What does mission do?
• Mission directs entire planning and guides
objectives
• Profitability, not a major subject in mission
• Mission expands and changes as the firm
grows

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Examples of Mission Statements
means quality: this is our promise. Our reputation
is built upon quality: our commitment to
continuous improvement will ensure that our
promise is delivered.

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“To organise the world's information and make it
universally accessible and useful.”

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“We meet everyday needs for nutrition, hygiene
and personal care with brands that help people feel
good, look good and get more out of life.”

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“To become a world class automotive engineering
and product development centre, and enable
Tata Motors
to become a world class automotive company.”

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Defining the business (Slide 1)
• What business are we in?
• What customer needs do we intend to serve?
• In what other ways can we meet this need?
• What could be the nature of this business in
the future?
• What are our basic strengths and distinctive
capabilities to operate in this business?

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Defining the business (Slide 2)
• Defining business today is difficult.
• Still a business definition is needed, a pithy,
clear-cut statement of the business.
• There is great need to look beyond the product,
the natural boundaries and ranks of one’s
competitors of today.

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Examples of Business Definitions
Nokia
“We are a technology company providing products and solutions
in the area of mobile communications that gives people unique
experiences. That happens through the lifestyle, through the
design, through the consumer experience, elements that we
have embedded in the products. It would be wrong to say, for
instance, that we are a consumer electronics company. That does
not tell the full story.”

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Examples of Business Definitions
Kingfisher Airlines
“We are in the aviation hospitality
business.”

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Surveying the environment
Techniques used in Environment Analysis
• Econometric models
• Trend analysis
• Regression analysis
• The Delphi Technique
• Benchmarking
• Espionage/spying
• Executive opinion/expert opinion
• Sales force estimates
• User expectations
• Market survey
• MIS of the firm

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Internal appraisal of the firm
The firm determines if there is a good fit between
the spotted opportunities and its own capabilities.
• Assessment of the strengths and weaknesses
in different functions
• Appraisal of the health of the individual
businesses
• Assessment of the competitive advantage
and core competencies

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Setting the corporate objectives
• Opportunities in the environment
indicates “what the firm might
do.”
• The firm decides “what it could
do,” after it assesses its internal
strengths.
• “What the firm would do,”
eventually depends on its basic
posture and values.

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Setting the corporate objectives
Areas where corporate objectives are set:
• Growth
• Profitability
• Market share & competitive position
• Productivity
• Technology & R&D
• Flexibility of business portfolio
• Human resources
• Corporate image
• Social responsibility

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What do we want to achieve?
“Objectives”
How will we go about achieving our desired
results?
“Strategy”
• Strategy is about direction
• Strategy is about choices
• Strategy is about differentiation

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What is Strategy?
• A strategy is a comprehensive action plan that
identifies long-term direction and guides
resource utilisation to accomplish organisational
goals with sustainable competitive advantage.
• Strategy is the way a firm reacts to its business
environment, deploying its resources and
marshalling its efforts for achieving its goals.

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Formulating the Corporate Strategy
Corporate strategy is about the overall
organisation’s purpose, the mission of the
company and the vision of what such will
look like.
Corporate strategy has to specify, through
which businesses and through what kind of
product-market exposure, is the growth
objective going to be achieved.

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Business strategy defines where and how to
compete in each chosen market and specifies the
business model and resources needed.
Marketing strategy defines how brands, products,
channels and communications must be developed
and deployed to achieve success.

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Build?
Maintain?
Harvest?
Divest?
To what extent?
At what pace?
The firm decides the businesses to be cultivated,
held, phased out and the new businesses to be
taken up for meeting the growth needs.

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Beauty business set to boom (Slide 1)
• Beauty consciousness has dawned on rising affluence.
• More households are upgrading to a higher consumption
lifestyle; there is an explosive growth in the Indian beauty
space.
• Living Standard Measurement (LSM) is being considered the
new socio-economic classification to gauge consumption
patterns: LSM 1-4 is the lowest level and LSM 8-plus is the top
end.
• There has been an 80-fold jump in growth in the consumption
of beauty products and services.
• Hindustan Unilever (HUL) is now speeding up to open a Lakme
salon a week.
• Jawed Habib Hair & Beauty (JHHB), which has grown from 37
salons in 2006 to around 225 at the end of November 2010, is
also eyeing a similar growth.
• And the foreign chains like the contemporary French beauty
salon, Jean-Claude Biguine, with annual revenues of 150
million euros, are setting up salons to groom the Indian
consumers.

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• The mushrooming of branded chains is expected to change
the landscape completely, ushering in a new era of trained
salon personnel, global insights and latest technologies.
• Lakme has dramatically stepped up investment, innovation
and its market capabilities.
• With close to 150 salons at present, HUL is scaling up rapidly,
setting up one Lakme salon per week. The ambition is
audacious.
• Currently, Indian hair and beauty industry is seeing a per
capita annual spend of only $1.2, which is far lower than world
standards. This number is expected to grow to $5 by 2015.
• The beauty market roughly estimated at Rs 7,000 crore
consisting of organized and unorganized hair and beauty
industry, is growing at the CAGR of 35%. At this rate, it has the
potential to become a Rs 30,000 crore business by 2015.
• Lakme has realized that the traditional methods of running an
FMCG company would not apply here.
• The company has set up a 100% subsidiary, looked after by a
dedicated team having a separate CEO.

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• In addition, HUL has now launched a beauty academy with the
objective to provide in house training to stylists.
• For this, HUL has forged an alliance with Pivot Point, a leading
beauty training company in the US.
• The company has created a Lakme brand council which will
advise on product innovation.
• HUL has already launched Unilever's global professional
product brand TIGI and hopes to build the salon brand in a
major way.
• It has tied up with global partners, Toly in Malta for packaging
structures, Fiabila in France for Nail Enamel, Schwann Stabilo
in Germany for all pencils and applicators and Intercos in Italy
for lipsticks, eye shadow and face make up.
• Perhaps the government needs to set up a regulatory system.

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• Questions
• With national players expanding their base, will the unorganized
market eventually be devoured?
• Why not?
• What should now be the strategy of predominantly unorganized
locally run beauty salon market which is at an inflection point?
• What are the environmental factors that will fuel the growth of
beauty industry?
• Why do you think that there is really room for so many players
in the Indian beauty space?
• What is crucial for any business model is the right return on
capital, the right cost structure and the right people. What are
the factors that can decelerate the growth?
• Why is the regulatory system needed in the beauty industry?

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Strategic Business Unit (SBU)
An SBU is a group of related businesses that can
be treated as a unified entity for the purpose of
strategic planning.
The principle underlying the SBU grouping is that
all related products, related from the standpoint of
function, should fall under one SBU.
In basic factors, mission, objectives, competition
and strategy, one SBU will be distinct from another.

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Kirloskar Oil Engines
Kirloskar Oil Engines makes different varieties of
engines – large engines, medium-sized engines
and small engines.

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Titan Industries
Titan Industries has four SBUs – Watches,
Jewellery business, Eye wear and Precision
engineering.

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Titan Industries
Tanishq offers a premium range of innovatively created gold
jewellery. Under Eye wear, Titan Industries offers sunglasses
under its Fastrack brand.
The Precision Engineering division of Titan Industries
supplies precision components to the aviation and the
automotive industry.

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The BCG Model
BCG matrix is often used to prioritise which products within
the company product mix get more funding and attention. The
BCG matrix is a portfolio planning model developed by Bruce
Henderson of the Boston Consulting Group in the early
1970’s. The basic idea behind it is that bigger the market
share a product has or faster the product's market grows the
better it is for the company.

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The BCG Model
Stars (high growth, high market share)
A Star needs a good deal of investment support as
it operates in a high-growth market. It normally
does not bring in immediate profits but holds great
potential for the future.
Cash Cows (low growth, high market share)
A Cash Cow brings in a lot of cash to the company.
It does not need heavy investment; being in a low-
growth market, expansion possibility and hence
investment needs of a Cash Cow, are minimal.

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The BCG Model
Dogs (low growth, low market share)
Dogs being businesses with weak market shares in
low-growth markets, are generally a drag on a
company and its resources. They are actually cash-
traps.
Question Marks (high growth, low market share)
Question Marks are net users of resources. But
unlike the Stars, their future is uncertain. In
addition, they are in the high-risk category while
Stars are in the medium-risk category.

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The BCG Model
Limitations of the BCG Matrix
• How we define market and how we get data
about market share.
• High market share does not lead to
profitability at all times.
• Market growth is not the only indicator for
attractiveness of a market.
• Low share or niche market can be profitable
too.
• The model employs only two dimensions.
• The model neglects the effect of synergy
between business units.

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Balanced Product Portfolio
A high-growth product takes some effort
and resources.
A low growth product is an established
product known by the market.

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Options for assessing growth opportunities
• Intensive growth opportunities
• Integrative growth opportunities
• Diversification growth opportunities

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Intensive growth opportunities
Ansoff’s Product-Market Expansion Grid

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• The world’s second-largest personal computer-maker,
Lenovo is sprinting fast in India.
• In the government and education sector, the company is
number one. There is an ambition to reach 30% market
share and to build a lead of about 6-7% over the number 2
player.
• In consumer market, Lenovo has a market share of about
10-11%. There, it wants to move to about 15% share.
• In small and medium business, it has 5 -5.5% market share
and that is where it wants to reach double digits.
• In India’s PC market, Lenovo is number two.

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• The rural India growth story is spreading with governments’
stimulating measures and increasing reach of marketers.

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Google developed a new browser Chrome for the
existing internet users.
McDonald’s is always coming out with new
burgers.

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Recognising that software as a service can be a
potent market penetration tool, Dell is assembling a
services portfolio that now includes e-mail disaster
recovery, spam/virus filtering and archiving via its
MessageOne acquisition.

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GlaxoSmithKline was the first one to launch
Sensodyne toothpaste in the tooth sensitivity, in the
pain relief category to take on the oral care giant
Colgate who launched Sensitive Pro-Relief toothpaste
subsequently.

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Canon diversified from a camera-making company
into producing whole new range of office
equipment.

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Bata India
Bata India, a Swiss multinational, was reeling under
continuous losses that peaked in 2004 to Rs 62 crore on a
turnover of Rs 725 crore and steadily grew thereafter till 2010,
when the company registered net profit of Rs 95 crore on a
turnover of Rs 1277 crore.
What did Bata do?
• Bata stores would remain closed on Sundays and most
would down shutters by 6 pm. The company ensured
that the stores remain open every day for 12 hours.

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Bata India
• In footwear, higher display tends to drive
higher sales. So the company plans to
increase the average store size to 5000sq ft.
• Bata is considering a proposal to start
franchisee operations in smaller cities where
setting up company-owned outlets may not
be viable.
• The company has launched a website for
online sales which is growing @ 200% and
already has about four lakh visitors since its
launch about a year back.
• Bata customizes the designs for India. For
instance, Indian women prefer small-sized
heals and there is a growing demand for
closed shoes.

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Coca-Cola
• Sales of soft drinks have long been stymied by erratic
power supply in markets deep in the hinterland.
• Coca-Cola has developed a chest cooler, “eKOCool,” that
operates exclusively through solar energy. It has a capacity
to store two crates which contains 48 bottles of 300ml each.
• The innovation gives Coca-Cola a competitive edge to tap
new rural markets and ramp up sales of a product which is
always best served chilled.

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Integrative Growth Opportunities
• The company can increase sales and profits through
backward, forward or horizontal integration.
• When the company acquires one or more of its
suppliers, it is called backward integration. The goal
of backward integration is for the company to
increase its purchasing power while diminishing that
of its suppliers.
• Forward integration means that the company enters
into distribution, wholesale or retail business. Doing
so ensures the company has a tighter rein over the
supply chain where the sale takes place.
• Horizontal integration happens when the company
acquires one or more of its competitors.

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Diversification Growth Opportunities
• Concentric diversification – The company seeks
new products that have technological or
marketing synergies with existing product lines
appealing a new group of customers.
• Horizontal diversification – The company
develops new products that are technologically
unrelated to its current products and appeals to
its current customers.
• Conglomerate diversification – The company
seeks new opportunities that have no relation
with its current technology, products or markets.

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Vertical Integration
• In the competitive world, companies do whatever
it takes to secure their stature in the marketplace.
• One of the most effective means is vertical
integration, which takes on two forms: forward
integration and backward integration.
• Businesses that practice vertical integration
control every facet of production, from obtaining
the necessary materials to selling the finished
product.

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Vision & Mission
Vision is the art of seeing into future.
What exactly are a mission and a vision?
• A mission is what an organization does, its action; a
vision is what an organization would like to happen as
a result of the action that it does.
• Mission describes what the organization is now; vision
describes what the organization would like to become.
Do we need both a mission and a vision?
• Vision without action is merely a dream. Action without
vision just passes the time.
• A vision statement describes how the future will look if
the organization achieves its mission.
• A mission gives the overall purpose while a vision
describes a picture of the "preferred future."

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The Marketing Mix & 4 Ps
What is marketing?
• Putting the right product in the right place, at the
right price, at the right time.
Understanding the Tool
• "Marketing mix" is a general phrase used to
describe the different kinds of choices
organizations have to make in the whole process of
bringing a product or service to market.
• The 4 Ps is one way, probably the best-known way,
of defining the marketing mix.

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The 4Ps are:
• Product (or Service)
• Place
• Price
• Promotion

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Product/Service
• What does the customer want from the
product/service?
• What features does it have to meet these needs?
• Are you including costly features that the customer
will not actually use?
• How and where will the customer use it?
• What does it look like? How will customers
experience it?
• What size(s), colour(s) and so on, should it be?
• What is it to be called?
• How is it branded?
• How is it differentiated from your competitors?
• What is the most it can cost to provide and still be
sold sufficiently profitably?

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Place
• Where do buyers look for your product or service?
• If they look in a store, what kind of store is it?
• How can you access the right distribution
channels?
• Do you need to use a sales force?
• What do you competitors do?

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Price
• What is the value of the product or service to the
buyer?
• Are there established price points for products or
services in this area?
• Is the customer price sensitive?
• What discounts should be offered to trade
customers or to other specific segments?
• How will your price compare with your competitors?

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Promotion
• Where and when can you get across your marketing
messages to your target market?
• Will you reach your audience by advertising in the
press or on TV or radio or on billboards?
• When is the best time to promote?
• How do your competitors do their promotions?

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• Another marketing mix model is 7Ps, sometimes
called the extended marketing mix, which include
the first 4 Ps, plus people, processes and physical
layout decisions.
• Another marketing mix approach is 4Cs. It is made
up of Customer needs and wants (the equivalent of
product), Cost (price), Convenience (place) and
Communication (promotion).

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Marketing Information System (MIS)
• Marketing Information System (MIS) is a system
that analyses and assesses marketing information,
gathered continuously from sources inside and
outside an organisation.
• Market Information System is a set of procedures
and practices employed in gathering, analyzing,
and assessing information about a firm’s market
environment comprised of competitors,
customers, suppliers, distribution intermediaries,
and sales personnel.
• Timely market information provides basis for
monitoring and estimating emerging market
trends. This is also called market intelligence
system.

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Marketing Information System (MIS)
Developing an MIS
A system is created in three phases:
• understanding of the information needs
• locating relevant data and transforming this into
usable information
• making this information available to managers
Locating data and developing information
• The information needed by marketing managers
comes from internal company records, marketing
intelligence and marketing research.

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Shoppers Stop
• Shoppers Stop offers shoppers a membership card, called
First Citizen at Rs 200.
• The card entitles shoppers to discounts on items, but also
provides valuable information to the chain.
• Since Shoppers Stop encourages customers to use their
card with each purchase, it can track what customers buy,
where and when.
• Using this information, it can track the effectiveness of
promotions, traces customers who have defected to other
stores and keep in touch with them if they relocate.
• Information from internal records is usually quicker and
cheaper to get than information from other sources.

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Marketing Intelligence
• Marketing Intelligence gives everyday
information about developments in changing
marketing environment that helps managers
prepare marketing plans.
• Some companies set up an office to collect
and circulate marketing intelligence. The staff
scans relevant publications, summarize
important news and send news bulletins to
marketing managers.

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Marketing Information System
• A marketing information system (MIS) is
intended to bring together disparate items of
data into a coherent body of information.
• A marketing information system is a
continuing and interacting structure of people,
equipment and procedures to gather, sort,
analyse, evaluate, and distribute pertinent,
timely and accurate information for use by
marketing decision makers to improve their
marketing planning, implementation and
control.

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Marketing Information System

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Internal Reporting Systems
• All enterprises which have been in operation for
any period of time have a wealth of information.
• The internal records that are of immediate value
to marketing decisions are: orders received,
stockholdings and sales invoices.
 Product type, size and pack type by industry
 Product type, size and pack type by customer
 Average value and/or volume of sale by territory
 Average value and/or volume of sale by type of account
 Average value and/or volume of sale by industry
 Average value and/or volume of sale by sales person

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Marketing Models used in MIS
• Time series sales modelling techniques
• Brand switching models
• Linear programming
• Elasticity models
• Regression and correlation models
• Analysis of Variance (ANOVA) models
• Sensitivity analysis
• Discounted cash flow

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Management Information System
• A management information system (MIS) is a system
that provides information needed to manage
organizations effectively.
• Management information systems involve three
primary resources: technology, information, and
people.
• The term "MIS" arose to describe information about
sales, inventories et al that would help in managing
the enterprise.
• Today, the term is used broadly and includes
decision support systems, resource and people
management applications, Enterprise Resource
Planning (ERP), Supply Chain Management (SCM),
Customer Relationship Management (CRM), project
management and database retrieval applications.

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Marketing Research
• Often a firm needs specific
information for solving a specific
marketing problem.
• When a firm carries out proper
marketing research before
undertaking any marketing
programme, its success rate
increases and risk rate reduces.

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Toyota
The market research included:
• Definition of the territory of a dealer
• Timing and frequency of orders
• Delivery and lead time for the arrival of
the vehicles

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Toyota
• Dealer margins and incentives offered
by the manufacturer
• Extent of down payment by customers
while ordering a car
• Advertising and sales promotions by
dealers
• Facilities sought by the manufacturer
from the dealer
• Capital support by the manufacturer
• Cash support for sales promotion
• Assistance in training of personnel

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Toyota
• Number of service staff
• Labour rates/salary structure
• Space available for service work
• Number of cars serviced per month
Toyota gained the knowledge that the
dealer network is the key to success in a
car venture in India.

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Marketing Research defined
Marketing research is defined as the
systematic gathering, recording and analyzing
of data about problems related to the
marketing of goods and services.
Marketing research reduces uncertainty in
decision-making.
The information collected by conducting
marketing research is used for problem
solving and decision making in various areas
of marketing.

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Marketing Research Applications
Subject Area of Application
Research on consumer
Consumer behaviour
Changes in consumer tastes
Consumer profile
Shifts in consumption patterns
Research on market/demand
Market size
Market potential
Market growth
Market share
Demand measurement and sales
forecasting
Seasonal trends
Research on product/brand
Product design/features/quality
Product usage
Brand preference
Packaging
Service requirement

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Marketing Research Applications
Subject Area of Application
Research on competition
Competitor’s products, prices,
promotion, channels, et al
Research on distribution
Effectiveness of different
marketing intermediaries
Warehousing efficiency
Distribution cost analysis
Research on price
Pricing pattern
Price elasticity of demand
Research on
advertising/promotion
Media research
Effectiveness of ad campaigns
Effectiveness of sales
promotions
Research on sales methods
Analysing selling problems
Sales territories analysis
Measuring effectiveness of sales
force
Study of sales compensation

Marketing Research
can help the marketing manager to:
• identify and define marketing
problems and opportunities
accurately
• understand markets and customers
and offer reliable prediction about
them
• develop marketing strategies and
actions to provide a competitive edge
and refine and evaluate them
• facilitate efficient usage of funds
• monitor marketing performance
• improve the understanding of
marketing as a process
is important because
of
• rapidly changing
marketing
environment
• need for up-to-
date information
for strategically
important areas
• importance of
research as an
integral part of
better operation
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Marketing Research may not be necessary
Marketing research may not be necessary if:
• information is available
• insufficient time
• non-availability of resources
• cost vs value of the research prohibitive
• outcomes known
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The Marketing Research Process
Define the
Problem, the
decision
alternatives
and
research
objectives

Define the research problem
• A research problem must be accurately
and precisely defined.
• Nature of the problem determines the type
of study to be conducted.
• Marketing problems may be difficulty-
related or opportunity-related.
• Conduct situation analysis. It provides the
basic motivation and momentum for
further research.
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Define the research problem
• What exactly does the firm want to know?
• How to know that there is a problem?
• In the initial stage, a problem may be recognized in
a very broad and general form only.
• Both the researcher and the marketing manager
need to work together to formulate the problem
into a precise and definite statement.
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Establish Research Objectives
Research objectives are related to and determined by
the problem definition.
In establishing research objectives, the researcher
must answer the following questions:
• What specific information should the project
provide?
• If more than one type of information will be
developed from the study, which is the most
important?
• What are the priorities?
• When specifying research objectives, development
of hypotheses might be very helpful.
• When achieved, objectives provide the necessary
information to solve the problem.
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Define the
Problem, the
decision
alternatives
and
research
objectives
Develop
the
research
plan and
collect the
information

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Develop the Research Plan
Development of a research plan involves making a
Research Design for carrying out the study.
– There are a number of alternative research
designs. The choice will largely depend on the
research purpose.
EXPLORATORY
Focus Group;
Observation;
Others.
QUALITATIVE RESEARCH
DESCRIPTIVE
Survey research
CAUSAL
Laboratory Experiment
Field Experiment
QUANTITATIVE RESEARCH
MARKETING RESEARCH

92
Qualitative Vs Quantitative Research
• Qualitative research involves collecting,
analyzing and interpreting data by observing
what people say or do.
• Quantitative research is the traditional
mainstream of marketing research.
– It is also called “survey research.”
– Its purpose is very specific.

93
Exploratory
Research
Descriptive
Research
Causal
Research
•Test hypotheses about cause-
and-effect relationships.
•Gathers preliminary information
that will help define the problem
and suggest hypotheses.
•Describes things such as consumers’
attitudes and demographics
or market potential for a product.

94
Experimental Research
Observational Research
Gathering data by observing people,
actions and situations
(Exploratory)
Survey Research
Asking individuals about
attitudes, preferences or
buying behaviors
(Descriptive)
Using groups of people to
determine cause-and-effect
relationships
(Causal)

95
Define the
Problem, the
decision
alternatives
and
research
objectives
Develop
the
research
plan and
collect the
information
Analyse
the
information
and
present
the findings

96
Collect the information
After defining the
problem the
researcher must
determine what kind
of information will
best meet the
research objectives.
– Secondary
information
– Primary
information
Marketing research
information may be
collected in many ways:
– via mail, telephone,
fax, Internet, or
personal interview.
– using consumer
panels, consisting of
individuals who have
agreed to provide
purchasing and
media viewing
behavior.

97
Secondary Primary
Collect the information
Determine the specific information needed
Information collected
for the specific purpose
at hand
Both must be:
Relevant
Accurate
Current
Impartial
Information that has
been previously
collected

• Questionnaires are an inexpensive way to gather
data.
• A questionnaire should be viewed as a multi-
stage process beginning with definition of the
aspects and ending with interpretation of the
results.
• Every step needs to be designed carefully
because the final results are only as good as the
weakest link in the questionnaire process.
Questionnaires
98

• The Sample - Who are you going to ask?
• The Method - How are you going to ask
them?
• The Questions - What are you going to ask
them?
• The Results - What will you do with the
information?
• The Cost - How much do you want to
pay for the answer?
• The Time - By when do you need the
Scale information?
Crucial Questions
99

• Structured non-disguised questionnaire
• Structured disguised questionnaire
• Non-structured non-disguised questionnaire
• Non-structured disguised questionnaire
Types of Questionnaire
100

101
Define the
Problem, the
decision
alternatives
and
research
objectives
Develop
the
research
plan and
collect the
information
Analyse
the
information
and
present
the findings
Make the
decision

Analyse the information and present the findings
• The researchers apply some advanced statistical
techniques and decision models, test different
hypotheses and theories, apply sensitivity
analysis to test assumptions.
• The major findings are presented to the
management.
Make the decision
• Depending on the confidence in the findings, the
management decides to use it, discard it or carry
out more research.
Make the decision
102

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