marketing research and decision support systems

1. C H A P T E R
© 2007 The McGraw-Hill Companies, Inc. All rights reserved.McGraw-Hill/Irwin
Marketing
Research
and Decision
Support Systems
6

2. 6-2 © 2007 The McGraw-Hill Companies, Inc. All rights reserved.Bearden Marketing 5th Ed
Learning Objectives
After studying this chapter, you should be able to:
 Understand the purpose and functions of marketing
research.
 Be familiar with the stages of the marketing research
process.
 Discuss different types of research designs, data collection
methods, and sources of secondary and primary marketing
research data.
 Understand many of the major issues involved with survey
design and sampling.
 Appreciate the role of marketing research within decision
support systems.

3. 6-3 © 2007 The McGraw-Hill Companies, Inc. All rights reserved.Bearden Marketing 5th Ed
IMS Health
IMS Health is the second largest marketing
research firm in the United States and the
largest provider of research information to the
global pharmaceutical industry. IMS is expertly
positioned to supply data and business solutions
to organizations throughout the health care
environment.

4. 6-4 © 2007 The McGraw-Hill Companies, Inc. All rights reserved.Bearden Marketing 5th Ed
What is Marketing Research?
Marketing research links the consumer, the
customer, and the public through information
used to
 Identify and define marketing opportunities.
 Generate, refine, and evaluate marketing actions.
 Monitor marketing performance.
 Improve understanding of marketing as a process.

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Marketing Research
Marketing research:
 Specifies the information required to address these
issues.
 Designs the methods for collecting information.
 Manages and implements the data collection process.
 Analyzes the results.
 Communicates the findings and implications.

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Marketing Research Questions

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The New Millennium
Marketing Research in the New Millennium:
 Environmental Phenomena will affect the marketing
research industry in the next decade and beyond.
 The traditional time line of 4 to 6 weeks for the typical
research project will not be acceptable.
 Marketing research is becoming a part of the marketing
strategy development process.
 Interactivity, e-commerce, and the Internet are affecting
the practice of marketing research.
 How will data be managed?
 Marketing research industry itself is in transition

8. 6-8 © 2007 The McGraw-Hill Companies, Inc. All rights reserved.Bearden Marketing 5th Ed
Market Research Process
The exhibit below shows the stages of the
marketing research process. The sequence
begins with an understanding of the problem
and ends with analysis and interpretation. The
overall objective should be to generate useful,
timely, and cost-effective information.
Exhibit 6-2

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Problem Definition
Problem Definition:
 The first step in any marketing research project and is
critical to its success.
All parties involved must:
 Focus on the real research problem, not the symptoms.
 Anticipate how the information will be used.
 Avoid prescribing a specific study until the problem is fully
understood and defined.

10. 6-10 © 2007 The McGraw-Hill Companies, Inc. All rights reserved.Bearden Marketing 5th Ed
Research Designs
Descriptive
Research
Casual
Research
Normally directed by one or more formal
research questions or hypotheses.
1. Cross-sectional study
2. Longitudinal research
Experiments in which researchers manipulate
independent variables and then observe or
measure the dependent variable or variables
of interest.
Exploratory
Research
Typically carried out to satisfy the researcher’s
desire for better understanding, or to develop
preliminary background and suggest issues for
a more detailed follow-up study.

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Three General Research Designs
Marketing research designs are general
strategies or plans of action for addressing the
research problem and the data collection and
analysis process.

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Data Collection Methods & Examples
Marketing research information can also be
categorized as either primary data or secondary
data. Interrelationships among the different
types of data and the various data collection
methods are summarized below:

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Telephone
Surveys
Telephone interviews are relatively cost-
effective; a large number of them over a wide
geographical area can be conducted quickly
and efficiently. Many firms use telephone
interviews as their primary means of
conducting survey research.
Focus
Groups
The most common exploratory procedure is
the focus group. Focus groups usually
comprise 8 to 12 individuals led by a
moderator in a focused, in-depth discussion
on a specific topic.
more
Data Collection Methods

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Personal
Interviews
Personal interviews involve one-on-one
interactions between a consumer, customer,
or respondent and the researcher or some
field interviewer paid to conduct the
interviews.
Mail
Surveys
Mail surveys can obtain broad geographical
market coverage, are generally less
expensive per completed survey than other
methods, and can be used to collect data
rather quickly. Surveys can address a range
of issues in a single questionnaire.
more
Data Collection Methods (con’t)

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Internet
Surveys
The Internet is fast becoming a popular
means of conducting survey research, as are
modified focus group discussions. With
technology changing rapidly, the future of
Internet-based research is both promising
and hard to predict.
Mall
Intercepts
The shortcomings of personal interviews
have led to increased use of mall intercept
interviews. In a mall intercept, consumers
are approached and interviewed while on
shopping trips.
more
Data Collection Methods (con’t)

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Projective
Techniques
Projective techniques, such as word
association or sentence completion, allow a
researcher to elicit feelings that normally go
unexpressed. They may be particularly useful
in eliciting honest opinions about sensitive
subjects.
Data Collection Methods (con’t)
Observation
Observation research monitors customer
behavior by a researcher or by video camera.
Much can be learned by unobtrusively
observing how customers use a firm’s or its
competitor’s products.

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Data Collection Instruments
The collection of marketing research information
typically involves construction of a data collection
instrument called a survey or questionnaire.

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Five Errors in Question Design
Errors in question design include five types:
 Double-barreled wording: “How would you rate the
handling ability and gas economy of your new Toyota?”
(very good, good, fair, poor, very poor)
 Loaded wording: “Given the growing rate of product
recalls, how likely would you be to complain about
problems with a new car purchase?” (likely, unlikely)
 Ambiguous wording: “Have you purchased a home
appliance within the last six months?” (yes, no)
 Inappropriate vocabulary: “Do you feel the current
discount rate is too high?” (yes, no)
 Missing alternatives: “Which of the following includes your
age?” (25 and under, 26 to 49, and over 50)

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Sample Design
The decisions and sequences involved in sampling are
presented below. The particular purpose of any research
greatly influences the nature of the sampling process; of
course, the population or group to be studied is
determined by the issue of interest.
Exhibit 6-7

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International Considerations
Eight common errors in conducting an
international research proposal:
 Selecting a domestic research company to do
international research
 Rigidly standardizing methods across countries
 Interviewing in English around the world
 Implementing inappropriate sampling techniques
 Failing to communicate effectively with local research
companies
 Lack of consideration given to language

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Evaluating Marketing Research
A research proposal is often developed prior to conducting a
research study. These proposals outline the purpose of the
research, the activities of the project, the costs and time
constraints, and the likely implications or outcomes. The most
important questions to ask in evaluating a research design
prior to conducting research are presented below:
Exhibit 6-8

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Ethical Issues in Marketing Research
Questionable Tactics:
 excessive interviewing
 lack of consideration and abuse of respondents
 delivering sales pitches under the guise of marketing
research
Questionable Research Practices:
 incomplete reporting of results
 misleading reporting
 nonobjective research

23. 6-23 © 2007 The McGraw-Hill Companies, Inc. All rights reserved.Bearden Marketing 5th Ed
Marketing Decision Support Systems
Many firms view all marketing data and information as
part of a larger entity called a marketing decision
support system (MDSS). All activities and
computerized elements used to process information
relevant to marketing decisions are components.
Exhibit 6-9

24. 6-24 © 2007 The McGraw-Hill Companies, Inc. All rights reserved.Bearden Marketing 5th Ed
Marketing Decision Support Systems
Marketing decision support systems are
generally designed to:
 Support but not supplant management decision making.
 Apply to semistructured decisions of middle and upper
management, such as pricing, promotion, and location
decisions.
 Provide interaction between and among people and
systems.
 Center on a segment of related decisions (the allocation
of marketing effort and resources).
 Be user-friendly.

25. 6-25 © 2007 The McGraw-Hill Companies, Inc. All rights reserved.Bearden Marketing 5th Ed
Database Marketing
Data
Mining
Customer
Relationship
Management
The process by which customer
descriptions are derived from
databases by the use of analytical
procedures that discover patterns
One extension of the use of information
at the customer level has been the
evolution of customer relationship
management.
Database
Marketing
The collection and use of individual
customer-specific information to make
marketing more efficient.

26. 6-26 © 2007 The McGraw-Hill Companies, Inc. All rights reserved.Bearden Marketing 5th Ed
Summary
After studying this chapter, you should be able to:
 Understand the purpose and functions of marketing
research.
 Be familiar with the stages of the marketing research
process.
 Discuss different types of research designs, data collection
methods, and sources of secondary and primary marketing
research data.
 Understand many of the major issues involved with survey
design and sampling.
 Appreciate the role of marketing research within decision
support systems.