Introduction to marketing research • IBM: • In the year 2008 revenues of $103.6 billion, conducts international tracking study twice a year in 14 different languages across 27 different countries in Europe, North and South America and Asia to capture trend data on main frame computing. The result of such a study allows IBM to see how successful it is in penetrating key industries and how IBM equipment is used in large and small businesses.
• Recipo: • An application service provider, it gives its clients the ability to view customer feedback the second it is entered on their website, to capture true word and emotion of the consumer. “Live” marketing research.
• Portico research: • It specializes in observing individuals recording them on videos and selling these tapes for tens of thousands of dollars to its major clients such as Honda, Delta, Lipton and P&G. For Lipton: to determine people’s attitudes towards tea.
• P&G • It created a website www.toejam.com to target teens. Company improved products also based on feedbacks and chats.• Marketing research has become global (IBM) and real time (Recipo), is being conducted in a specialized manner (Portico) and has become much more integrated with marketing (P&G)
Definition: • According to the American Marketing Association: • “Marketing research is the function that links the consumer, customer and public to the marketer through information – information used to identify and define marketing opportunities and problems; generate, refine, and evaluate marketing actions; monitor marketing performance; and improve understanding of marketing as a process.” • “Marketing research is the systematic and objective identification, collection, analysis, dissemination and use of information for the purpose of improving decision making related the identification and solution of problems and opportunities in marketing.”
Classification of Marketing Research: • To identify: • Problem identification research ▪ Market Potential research ▪ Market Share research ▪ Image research ▪ Market characteristics Research ▪ Sales analysis Research ▪ Forecasting Research ▪ Business trends Research• To solve: • Problem solving Research ▪ Segmentation Research ▪ Product Research ▪ Pricing research ▪ Promotion Research ▪ Distribution research
• A survey of companies conducting marketing research indicates that 97% of those who responded were conducting market potential, market share and market characteristics research• About 90% also reported that they were using other types of problem identification research. • Table 1.1: Problem solving research
• However problem identification and problem solving research go hand in hand as shown by Kellogg’s example in the case “Crunchy nut Red adds color to Kellogg’s sales” • Problem identification and problem solving research not only go hand in hand as shown by the Kellogg’s Example, but they also follow a common marketing research process.
• Marketing Research Process: • It is a set of six steps that defines the tasks to be accomplished in conducting a marketing research study. These include problem definition, development of an approach to the problem, research design formation, field work, data preparation and analysis, and report preparation.
• STEP 1: • Problem definition: ▪ Purpose of study ▪ The relevant background information ▪ The information needed. How it will be used in decision making.• STEP 2: • Development of an approach to the problem: ▪ An objective or theoretical framework ▪ Analytical methods ▪ Research questions ▪ Hypotheses ▪ Identify the information needed.
• STEP 3 : • Research design Formulation: ▪ Research design is a blue print or a framework for conducting the Marketing research Project. It involves following steps: ▪ Definition of the information needed ▪ Secondary data analysis ▪ Qualitative research ▪ Methods of collecting quantitative data (survey, observation and experimentation) ▪ Measurement and scaling procedures ▪ Questionnaire design ▪ Sampling process and sample size ▪ Plan of data analysis
• STEP 4: • Field work or Data Collection• Step 5: • Data Preparation and analysis. ▪ Editing ▪ Coding ▪ Transcription and verification of data• STEP 6: • Report preparation and presentation ▪ Addressing the specific research ▪ Questions identified ▪ Describing the approach ▪ The research design ▪ Data collection ▪ Data analysis procedure adopted ▪ Results and major findings
• The nature of marketing research: • Fig: 1.2: The role of marketing research • Case study: Johnson and Johnson introduced gentle aspirin for babies which failed in the market.
• Marketing research suppliers and services: • Fig: 1.3: Marketing research suppliers and services:
• The role of MR in MIS and DSS • MIS: Marketing information system: A formalized set of procedures for generating, analyzing, storing and distributing pertinent information to marketing decision makers on an ongoing business. • DSS: Decision support systems: Information systems that enable decision makers to interact directly with both databases and analysis models.
• MIS • Structured problems • Use of reports • Rigid structures • Information displaying restricted • Can improve decision making by clarifying the raw data • DSS • Unstructured problems • Use of models • User friendly interactions • Adaptability • Can improve decision making by using “what if” analysis.
International Marketing Research: • Some Facts: • US accounts for only 39% of the MR expenditure worldwide. • 40% of MR is conducted in western Europe. • 9% of MR is conducted in Japan • Most of European research is done in Germany, UK, France, Italy and Spain.
CHAPTER 2• Defining the marketing research problem and developing an approach • Harley goes Whole Hog: ▪ Comeback in 2000s- so that there was a long waiting list to get a bike ▪ In 2001, HD’s revenue exceeded $3.3 billion. ▪ Distributors urged HD to build more motorcycles but the company was skeptical about investing in new production facilities. ▪ The management decision problem was “should HD invest to produce more motorcycles?”• Importance of defining a problem: • Problem definition: A broad statement of the general problem and identification of the specific components of the marketing research problem. All efforts, time , money spent will be wasted if the problem is misunderstood or ill defined.
• The process of defining the problem and developing an approach: • Fig: 2.1• Tasks Involved: • Discussions with decision makers. • Interviews with industry experts • Secondary data analysis • Qualitative research• Environmental context of the problem: • Past information and forecasts • Resources and constraints • Objectives • Buyer behavior • Legal environment • Economic environment • Marketing and technological skills.
• Management decision problem and marketing research problem • Defining marketing research problem: • Broad statement - specific components • Components of the approach: • Objective / theoretical framework • Analytical model • Research questions • Hypotheses: ▪ An unknown statement or proposition about a factor or phenomenon that is of interest to researcher. • Specification of information needed.
• Cases: • 1.1 Life in fast lane: fast food chains race to be number one. • 1.2 Nike sprints ahead of the competition, yet has a long way to run. • 1.3 Lexus Imparting value to luxury and luxury to value. • Video Cases: • Burke: Learning and growing through MR (www.burke.com) • Accenture: the accent is in the name (www.accenture.com)
Research Design formulation• A research design is formulated after: • The problem has been defined • The approach developed
Research design• Types of research design: • Exploratory • Conclusive ▪ Descriptive ▪ Causal• At a broad level two main types of research designs are employed in marketing research: • Exploratory • conclusive
• Exploratory research involves sec0ndary data and qualitative research.• Descriptive research makes use of survey and observation methods• The major methodology used in causal designs is experimental
Example• In a study of cause related marketing, exploratory research in the form of secondary data analysis and focus groups was conducted to identify the social causes that American businesses should be concerned about. As a result the following causes were identified as salient : • Child care, drug abuse, public education, hunger, crime, environment, medical research and poverty.
• Then conclusive research in the form of a descriptive cross sectional survey was undertaken to quantify how and why causes related marketing influences, consumer’s perception of the company and brands to determine the relative salience of the causes identified in exploratory research.• A random sample of 2,000 Americans was surveyed by telephone. About 61% of the respondents said that when price and quality are equal, they would switch brands or stores to companies that support good causes that help in the local or national level.
• The survey also revealed that 68% of the consumers would pay more for a product that is linked to a good cause. Company support of good causes produces a more positive image and greater trust of the company according to 66% of those surveyed.
• In keeping with these findings, Starbucks wants to help the environment by providing a new “eco-friendly” coffee cup. The company also has initiatives to help small coffee bean farmers, local community programs and charitable giving. There are even employee incentives and awards for volunteering for these causes.
Research design: Definition • A research design is a framework or blueprint for conducting the marketing research project. It specifies the details of the procedures necessary for obtaining the information needed to structure and / or solve marketing research problems.
• Typically a research design involves the following components or tasks: • Define the information needed. • Define the exploratory , descriptive and/or causal phases of the research. • Specify the measurement and scaling process and procedures. • Construct and pretest a questionnaire (interview form) or an appropriate form for data collection. • Specify the sampling process and sample. • Develop a plan of data analysis.
Research Design : Classification Research Design Exploratory Conclusive Descriptive Causal Cross Sectional Longitudinal Single cross Multiple Cross sectional sectional
• Exploratory Research: • One type of research design, which has as it’s primary objective the provision of insights into, and comprehension of the problem situation confronting the researcher. • The primary aim of the exploratory research is to provide insights, into, and an understanding of, the problem confronting the researcher. • Exploratory research is used in cases when you must define the problem more precisely, identify relevant courses of action, or gain additional insights before an approach can be developed. The information needed is only loosely defined at this stage, and the research process that is adopted is flexible and unstructured. For example: personal interviews with the industry experts. Primary data is qualitative but small and non representative in nature. So findings are tentative and can be an input for further research.
• Conclusive Research: • Research designed to assist the decision maker in determining, evaluating and selecting the best course of action to take in a given situation. • Conclusive research is typically more formal and structured then exploratory research. • It is based on large representative samples and the data obtained are subjected to quantitative analysis. The findings from this research are considered to be conclusive in nature in that they are used as input into managerial decision making. • Conclusive research decisions can be either descriptive or causal and descriptive research designs may be either cross sectional or longitudinal.
Differences Between Exploratory and Conclusive Research Exploratory ConclusiveObjective: To Provide insights and To test hypothesis and understanding. examine relationships.Characteristics: Information needed is Information needed is defined only loosely. clearly defined. Research process is Research process isFindings/ results: Tentative. Conclusive.Outcome: Generally followed by Findings used as input further exploratory or into decision making. conclusive research.
A comparison of the basic research designs Exploratory Descriptive CausalObjective: Discover ideas and Describe market Determine the insights characteristics or cause and effect functions. relationships.Characteristics: Flexible, Marked by the Manipulation of Versatile, Often prior formulation one or more the front end of of specific independent the total design hypothesis. variables. ControlMethods: Expert Surveys, Secondary Data, Experiments. Pilot Surveys, Surveys, Panels, Secondary Data, Observational and Qualitative other data.
Exploratory Research• Objective is to explore or search through a problem or situation to provide insights and understanding. • Purpose: • Formulate a problem or define a problem more precisely. • Identify alternative courses of action. • Develop hypothesis. • Isolate key variables and relationships for further examination. • Gain insights for developing an approach to the problem. • Establish priorities for further research.
• The creativity and ingenuity of the researcher plays a major role in exploratory research. Researchers are alert to new ideas and insights as they proceed. Once a new idea or insight is discovered, they may redirect their exploration in that direction.• Yet the ability of the researcher are not the sole determinations of good exploratory research. Exploratory research can generally benefit from the use of following methods: • Survey of experts. • Pilot Surveys • Secondary data analyzed in a qualitative way. • Qualitative research.
Descriptive Research• A type of conclusive research that has as its major objective the description of something- usually market characteristics or functions.• It assumes that the researcher has much prior knowledge about the problem situation.• It is preplanned and structured.• A descriptive design requires a clear specification of the who, what, when, where, why and way of the research.
• Purpose: • To describe the characteristics of relevant groups, such as consumers, salespeople, organizations, or market areas. • To estimate the percentage of units in a specified population exhibiting a certain behavior. • To determine the perceptions of product characteristics. • To determine the degree to which marketing variables are associated. • To make specific predictions.
• Descriptive research, in contrast to exploratory research is marked by a clear statement of the problem, specific hypotheses, and detailed information needs. • Market studies. • Market share studies. • Sales analysis studies. • Image studies. • Product usages studies. • Distribution studies. • Pricing studies. • Advertising studies.
Methods of Descriptive Research• Secondary data analyzed in a quantitative as opposed to a qualitative manner.• Surveys.• Panels.• Observational and other data.
Cross-sectional Designs• Involves the collection of information from any given sample of population elements only once. • In single cross-sectional designs, there is only one sample of respondents and information is obtained from this sample only once.• In multiple cross-sectional designs, there are two or more samples of respondents, and information from each sample is obtained only once. Often, information from different samples is obtained at different times. • To predict changes • Find trends • Cohort analysis consists of a series of surveys conducted at appropriate time intervals, where the cohort serves as the basic unit of analysis. A cohort is a group of respondents who experience the same event within the same time interval.
Consumption of Various Soft Drinks by Various Age Cohorts Table 3.3 Percentage consuming on a typical dayAge 1950 1960 1969 19798-19 52.9 62.6 73.2 81.020-29 45.2 60.7 76.0 75.8 C830-39 33.9 46.6 67.7 71.4 C740-49 23.2 40.8 58.6 67.8 C650+ 18.1 28.8 50.0 51.9 C5 C1 C2 C3 C4C1: cohort born prior to 1900 C5: cohort born 1931-40C2: cohort born 1901-10 C6: cohort born 1940-49C3: cohort born 1911-20 C7: cohort born 1950-59C4: cohort born 1921-30 C8: cohort born 1960-69
Longitudinal Designs• A fixed sample (or samples) of population elements is measured repeatedly on the same variables• A longitudinal design differs from a cross-sectional design in that the sample or samples remain the same over time. In other words, the same people are studied over time and the same variables are measured. • How did the American people rate the performance of George w. Bush immediately after the war in Afghanistan? ▪ Cross sectional design • How did the American people change their view of Bush’s performance during the war in Afghanistan? ▪ Longitudinal design
Relative Advantages and Disadvantages of Longitudinal and Cross-Sectional Designs Table 3.4Evaluation Cross-Sectional Design LongitudinalCriteria DesignDetecting Change - +Large amount of data collection - +Accuracy - +Representative Sampling + -Response bias + - Note: A “+” indicates a relative advantage over the other design, whereas a “-” indicates a relative disadvantage. “A major advantage of longitudinal design over the cross sectional design is the ability to detect change as a result of repeated measurement of the same variables on the same sample.”
• Another advantage of the panels is that relatively large amount of data can be collected, because panel members are usually compensated for their participation, they are willing to participate in lengthy and demanding interviews.• Panel data can be more accurate than cross sectional data. • The main disadvantage of panels is that they may not be representative because: • Refusal to cooperate (40% or more) • Mortality (20% a year) • Payment
Causal Research• A type of conclusive research where the major objective is to obtain evidence regarding cause-and-effect (causal) relationship.• It requires a planned and structured design.• A relatively controlled environment is one in which the other variables that may affect the dependent variable are controlled or checked as much as possible. The effect of manipulation on one or more dependent variables is then measured to infer causability. • In a departmental store, the presence and helpfulness of salespeople (causal variable) will influence the sales of housewares(effect variable). • MeadWestvaco Experiment ▪ Does merchandise display affect sales?
Uses of Casual Research• To understand which variables are the cause (independent variables) and which variables are the effect (dependent variables) of a phenomenon.• To determine the nature of the relationship between the causal variables and the effect to be predicted.• METHOD: Experiments
Relationship among Exploratory,Descriptive and Causal Research• When little is known about the problem situation, it is desirable to begin with exploratory research. Exploratory research is appropriate when the problem needs to be defined more precisely, alternative courses of action identified, research questions or hypotheses developed.• Exploratory research is the initial step in the overall research design framework. It should, in most instances, be followed by descriptive or causal research.
Citicorp Banks on Exploratory, Descriptive, and Causal ResearchMarketing Research at Citicorp is typical in that it is used to measure consumerawareness of products, monitor their satisfaction and attitudes associated withthe product, track product usage and diagnose problems as they occur. Toaccomplish these tasks Citicorp makes extensive use of exploratory,descriptive, and causal research. Often it is advantageous to offer specialfinancial packages to specific groups of customers. In this case, a financialpackage is being designed for senior citizens.The following seven-step process was taken by marketing research to help inthe design.
Citicorp Banks on Exploratory, Descriptive, and Causal Research1) A taskforce was created to better define the market parameters to include allthe needs of the many Citicorp branches. A final decision was made to includeAmericans 55 years of age or older, retired, and in the upper half of thefinancial strata of that market.
Citicorp Banks on Exploratory, Descriptive, and Causal Research2) Exploratory research in the form of secondary data analysis ofthe mature or older market was then performed and a study ofcompetitive products was conducted. Exploratory qualitativeresearch involving focus groups was also carried out in order todetermine the needs and desires of the market and the level ofsatisfaction with the current products. In the case of senior citizens, a great deal of diversity was found in the market. This was determined to be due to such factors as affluence, relative age, and the absence or presence of a spouse.
Citicorp Banks on Exploratory, Descriptive, and Causal Research3) The next stage of research was brainstorming. This involved theformation of many different financial packages aimed at the target market.In this case, a total of 10 ideas were generated.
Citicorp Banks on Exploratory, Descriptive, and Causal Research4) The feasibility of the 10 ideas generated in step 3 was then tested.The ideas were tested on the basis of whether they were possible inrelation to the business. The following list of questions was used as aseries of hurdles that the ideas had to pass to continue on to the nextstep.• Can the idea be explained in a manner that the target market will easily understand?• Does the idea fit into the overall strategy of Citicorp?
Citicorp Banks on Exploratory, Descriptive, and Causal Research • Is there an available description of a specific target market for the proposed product? • Does the research conducted so far indicate a potential match for target market needs, and is the idea perceived to have appeal to this market? • Is there a feasible outline of the tactics and strategies for implementing the program? • Have the financial impact and cost of the program been thoroughly evaluated and determined to be in line with company practices? In this study, only one idea generated from the brainstorming session made it past all the listed hurdles and on to step 5.
Citicorp Banks on Exploratory, Descriptive, and Causal Research 5) A creative work-plan was then generated. This plan was to emphasize the competitive advantage of the proposed product as well as better delineate the specific features of the product. 6) The previous exploratory research was now followed up with descriptive research in the form of mall intercept surveys of people in the target market range. The survey showed that the list of special features was too long and it was decided to drop the features more commonly offered by competitors.
Citicorp Banks on Exploratory, Descriptive, and Causal Research 7) Finally, the product was test marketed in six of the Citicorp branches within the target market. Test marketing is a form of causal research. Given successful test marketing results, the product is introduced nationally.
Potential Sources of Error in Research Designs Fig. 3.2 Total Error Random Non-sampling Sampling Error Error Response Non-response Error Error Researcher Interviewer Respondent Error Error ErrorSurrogate Information Error Respondent Selection Error Inability ErrorMeasurement Error Questioning Error Unwillingness ErrorPopulation Definition Error Recording ErrorSampling Frame Error Cheating ErrorData Analysis Error
Errors in Marketing Research• The total error is the variation between the true mean value in the population of the variable of interest and the observed mean value obtained in the marketing research project. • Random sampling error is the variation between the true mean value for the population and the true mean value for the original sample. • Non-sampling errors can be attributed to sources other than sampling, and they may be random or nonrandom: including errors in problem definition, approach, scales, questionnaire design, interviewing methods, and data preparation and analysis. Non-sampling errors consist of non-response errors and response errors.
Errors in Marketing Research• Non-response error arises when some of the respondents included in the sample do not respond. • Response error arises when respondents give inaccurate answers or their answers are misrecorded or misanalyzed.
Budgeting and scheduling theproject• Management tools needed to help ensure that the marketing research project is completed within the available resources-financial, time and manpower etc.• Once a research design, appropriately controlling the total error, has been specified, the budgeting and scheduling decision should be made• CPM- critical path method. • Management technique of dividing a research project into component activities, determining the sequence of these components and the time each activity will require.• PERT- Program evaluation and review techniques. • A more sophisticated critical path method that accounts for the uncertainty in project completion times.• GERT- graphical evaluation and review techniques. • A sophisticated critical path method that accounts for both the completion probabilities and the activity costs.
Marketing Research Proposal• The official layout of the planned marketing research activity for management.• It describes the research problem, the approach, the research design, data collection methods, data analysis methods, and reporting methods. • Once the research design has been formulated and budgeting and scheduling of the project accomplished, a written research proposal should be prepared.• The marketing research proposal contains the essence of the project and serves as a contract between the researcher and the management.
Marketing Research Proposalcontains:• Executive Summary• Background• Problem Definition/Objectives of the Research• Approach to the Problem• Research Design • Kind of information to be obtained • Methods of administrating the questionnaire. • Scaling techniques. • Nature of the questionnaire. • Sampling plan and sample size.• Fieldwork/Data Collection• Data Analysis• Reporting• Cost and Time• Appendices
Chapter FourExploratory Research Design: Secondary Data
Primary vs. Secondary Data• Primary data are originated by a researcher for the specific purpose of addressing the problem at hand. The collection of primary data involves all six steps of the marketing research process.• Secondary data are data which have already been collected for purposes other than the problem at hand. These data can be located quickly and inexpensively. s Censu Data
A Comparison of Primary & Secondary Data Table 4.1 Primary Data Secondary DataCollection purpose For the problem at hand For other problemsCollection process Very involved Rapid & easyCollection cost High Relatively lowCollection time Long Short
Uses of Secondary Data• Identify the problem• Better define the problem• Develop an approach to the problem• Formulate an appropriate research design (for example, by identifying the key variables)• Answer certain research questions and test some hypotheses• Interpret primary data more insightfully
Criteria for Evaluating Secondary Data• Specifications: Methodology Used to Collect the Data • Error: Accuracy of the Data • Currency: When the Data Were Collected• Objective(s): The Purpose for Which the Data Were Collected• Nature: The Content of the Data• Dependability: Overall, How Dependable Are the Data
Criteria for Evaluating Secondary Data Table 4.2Criteria Issues RemarksSpecifications & Data collection method, response rate, Data should be reliable,Methodology quality & analysis of data, sampling valid, & generalizable to the technique & size, questionnaire problem. design, fieldwork. Error & Accuracy Examine errors in approach, Assess accuracy by research design, sampling, data comparing data from collection & analysis, & reporting. different sources. Currency Time lag between collection & Census data are updated by Objective publication, frequency of updates. syndicated firms. Why were the data collected? The objective determines Nature the relevance of data. Definition of key variables, units of Reconfigure the data to measurement, categories used, increase their usefulness. Dependability relationships examined. Expertise, credibility, reputation, & Data should be obtained trustworthiness of the source. from an original source.
A Classification of Secondary Data Fig. 4.1 Secondary Data Internal ExternalReady to Requires Published Computerized SyndicatedUse Further Materials Databases Services Processing
Internal Secondary DataDepartment Store ProjectSales were analyzed to obtain:• Sales by product line• Sales by major department (e.g., mens wear, house wares)• Sales by specific stores• Sales by geographical region• Sales by cash versus credit purchases• Sales in specific time periods• Sales by size of purchase• Sales trends in many of these classifications were also examined.
Type of Individual/Household Level Data Available from Syndicated FirmsI. Demographic Data - Identification (name, address, telephone) - Sex - Marital status - Names of family members - Age (including ages of family members) - Income - Occupation - Number of children present - Home ownership - Length of residence - Number and make of cars owned
Type of Individual/Household Level DataAvailable from Syndicated FirmsII. Psychographic Lifestyle Data - Interest in golf - Interest in snow skiing - Interest in book reading - Interest in running - Interest in bicycling - Interest in pets - Interest in fishing - Interest in electronics - Interest in cable televisionThere are also firms such as Dun & Bradstreet and American BusinessInformation which collect demographic data on businesses.
A Classification of Published Secondary Sources Fig. 4.2 Published Secondary Data General Business Government Sources SourcesGuides Directories Indexes Statistical Census Other Data Data Government Publications
A Classification of Computerized Databases Fig. 4.3 Computerized Databases Online Internet Off-LineBibliographic Numeric Full-Text Directory Special-Databases Databases Databases Databases Purpose Databases
Published External Secondary SourcesGuides• An excellent source of standard or recurring information• Helpful in identifying other important sources of directories, trade associations, and trade publications• One of the first sources a researcher should consultDirectories• Helpful for identifying individuals or organizations that collect specific data• Examples: Consultants and Consulting Organizations Directory, Encyclopedia of Associations, FINDEX: The Directory of Market Research Reports, Studies and Surveys, and Research Services DirectoryIndices• Helpful in locating information on a particular topic in several different publications
Classification of ComputerizedDatabases• Bibliographic databases are composed of citations to articles.• Numeric databases contain numerical and statistical information. • Full-text databases contain the complete text of the source documents comprising the database. • Directory databases provide information on individuals, organizations, and services. • Special-purpose databases provide specialized information.
Syndicated Services• Companies that collect and sell common pools of data of known commercial value designed to serve a number of clients.• Syndicated sources can be classified based on the unit of measurement (households/consumers or institutions). • Household/consumer data may be obtained from surveys, diary panels, or electronic scanner services. • Institutional data may be obtained from retailers, wholesalers, or industrial firms.
A Classification of SyndicatedServices Fig. 4.4 Unit of Measurement Households/ Institutions Consumers
Syndicated Services: Consumers Fig. 4.4 cont. Households / Consumers Panels Electronic scanner services Purchase Media Surveys Volume Scanner Diary Scanner Diary Tracking Data Panels Panels with Cable TVPsychographic Advertising& Lifestyles General Evaluation
Overview of Syndicated Services Table 4.3Type Characteristics Advantages Disadvantages UsesSurveys Surveys conducted at Most flexible way of Interviewer errors; Market regular intervals obtaining data; respondent errors segmentation, information on advertising theme underlying motives selection and advertising effectivenessPurchase Households provide Recorded purchase Lack of Forecasting sales,Panels specific information behavior can be representativeness; market share and regularly over an linked to the response bias; trends; establishing extended period of demographic/ maturation consumer profiles, time; respondent psychographic brand loyalty and asked to record characteristics switching; evaluating specific behaviors as test markets, they occur advertising, and distributionMedia Panels Electronic devices Same as purchase Same as purchase Establishing automatically panel panel advertising rates; recording behavior, selecting media supplemented by a program or air time; diary establishing viewer profiles
Overview of Syndicated Services Table 4.3 cont.Type Characteristics Advantages DisadvantagesScanner Volume Household purchases Data reflect actual Data may not beTracking Data are recorded through purchases; timely data, representative; errors in electronic scanners in less expensive recording purchases; supermarkets difficult to link purchases to elements of marketing mix other than priceScanner Diary Panels Scanner panels of Data reflect actual Data may not bewith Cable TV households that purchases; sample representative; quality subscribe to cable TV control; ability to link of data limited panel data to household characteristics
Overview of Syndicated Services Table 4.3 cont.Audit services Verification of product Relatively precise Coverage may be Measurement of movement by information at the incomplete; matching consumer sales and examining physical retail and wholesale of data on competitive market share, records or performing levels activity may be competitive activity, inventory analysis difficult analyzing distribution patterns; tracking of new productsindustrial products Data banks on Important source of Data are lacking in Determining marketsyndicated services industrial information on terms of content, potential by geographic establishments created industrial firms, quantity, and quality area, defining sales through direct inquiries particularly useful in territories, allocating of companies, clipping initial phases of the advertising budget services, and corporate projects reports
Single-Source DataSingle-source data provide integrated information onhousehold variables, including media consumption andpurchases, and marketing variables, such as productsales, price, advertising, promotion, and in-storemarketing effort. • Recruit a test panel of households and meter each homes TV sets.• Survey households periodically on what they read. • Grocery purchases are tracked by UPC scanners. • Track retail data, such as sales, advertising, and promotion.
A Classification of International Sources Fig. 4.5 International Secondary DataDomestic Organizations International Organizations inin the United States Organizations in the Foreign Countries United StatesGovernment Nongovernment International TradeSources Sources Governments Organizations Associations
Chapter FiveExploratory Research Design:Qualitative Research
A Classification of Marketing Research Data Fig. 5.1 Marketing Research Data Secondary Data Primary Data Qualitative Data Quantitative Data Descriptive CausalSurvey Observational ExperimentalData and Other Data Data
Qualitative vs. Quantitative Research Table 5.1 Qualitative Research Quantitative Research To gain a qualitative To quantify the data andObjective understanding of the generalize the results from the underlying reasons and sample to the population of motivations interest Small number of non- Large number of representativeSample representative cases cases Unstructured StructuredData Collection Non-statistical StatisticalData Analysis Develop an initial Recommend a final course ofOutcome understanding action
A Classification of Qualitative ResearchProcedures Fig. 5.2 Qualitative Research Procedures Direct (Non Indirect disguised) (Disguised) Projective TechniquesFocus Groups Depth Interviews Association Completion Construction Expressive Techniques Techniques Techniques Techniques
Characteristics of Focus Groups Table 5.2 Group Size 8-12 Group Composition Homogeneous, respondents, prescreened Physical Setting Relaxed, informal atmosphere Time Duration 1-3 hours Recording Use of audiocassettes and videotapes Moderator Observational, interpersonal, and communication skills of the moderator
Key Qualifications of Focus Group Moderators1. Kindness with firmness: The moderator must combine a disciplined detachment with understanding empathy so as to generate the necessary interaction.2. Permissiveness: The moderator must be permissive yet alert to signs that the group’s cordiality or purpose is disintegrating.3. Involvement: The moderator must encourage and stimulate intense personal involvement.4. Incomplete understanding: The moderator must encourage respondents to be more specific about generalized comments by exhibiting incomplete understanding.
Key Qualifications of Focus Group Moderators5. Encouragement: The moderator must encourage unresponsive members to participate.6. Flexibility: The moderator must be able to improvise and alter the planned outline amid the distractions of the group process.7. Sensitivity: The moderator must be sensitive enough to guide the group discussion at an intellectual as well as emotional level.
Procedure for Planning and Conducting Focus Groups Fig. 5.3 Determine the Objectives and Define the Problem Specify the Objectives of Qualitative Research State the Objectives/Questions to be Answered by Focus Groups Write a Screening Questionnaire Develop a Moderator’s Outline Conduct the Focus Group Interviews Review Tapes and Analyze the Data Summarize the Findings and Plan Follow-Up Research or Action
Variations in Focus Groups • Two-way focus group. This allows one target group to listen to and learn from a related group. For example, a focus group of physicians viewed a focus group of arthritis patients discussing the treatment they desired. • Dual-moderator group. A focus group conducted by two moderators: One moderator is responsible for the smooth flow of the session, and the other ensures that specific issues are discussed. • Dueling-moderator group. There are two moderators, but they deliberately take opposite positions on the issues to be discussed.
Variations in Focus Groups • Respondent-moderator group. The moderator asks selected participants to play the role of moderator temporarily to improve group dynamics. • Client-participant groups. Client personnel are identified and made part of the discussion group. • Mini groups. These groups consist of a moderator and only 4 or 5 respondents. • Tele-session groups. Focus group sessions by phone using the conference call technique. • Online Focus groups. Focus groups conducted online over the Internet.
Disadvantages of Focus Groups1. Misuse2. Misjudge3. Moderation4. Messy5. Misrepresentation
Depth Interview Techniques: LadderingIn laddering, the line of questioning proceeds from product characteristics to user characteristics. This technique allows the researcher to tap into the consumers network of meanings. Wide body aircrafts (product characteristic) I can get more work done I accomplish more I feel good about myself (user characteristic) Advertising theme: You will feel good about yourself when flyingour airline. “Youre The Boss.”
Depth Interview Techniques: Hidden Issue Questioning In hidden issue questioning, the focus is not on socially shared values but rather on personal “sore spots;” not on general lifestyles but on deeply felt personal concerns. fantasies, work lives, and social lives historic, elite, “masculine-camaraderie,” competitive activities Advertising theme: communicate aggressiveness, high status, and competitive heritage of the airline.
Depth Interview Techniques: Symbolic Analysis Symbolic analysis attempts to analyze the symbolic meaning of objects by comparing them with their opposites. The logical opposites of a product that are investigated are: non-usage of the product, attributes of an imaginary “non-product,” and opposite types of products. “What would it be like if you could no longer use airplanes?” “Without planes, I would have to rely on letters and long distance calls.” Airlines sell to the managers face-to-face communication. Advertising theme: The airline will do the same thing for a manager as Federal Express does for a package.
Definition of Projective Techniques• An unstructured, indirect form of questioning that encourages respondents to project their underlying motivations, beliefs, attitudes or feelings regarding the issues of concern. • In projective techniques, respondents are asked to interpret the behavior of others. • In interpreting the behavior of others, respondents indirectly project their own motivations, beliefs, attitudes, or feelings into the situation.
Word Association In word association, respondents are presented with a list of words, one at a time and asked to respond to each with the first word that comes to mind. The words of interest, called test words, are interspersed throughout the list which also contains some neutral, or filler words to disguise the purpose of the study. Responses are analyzed by calculating: (1) the frequency with which any word is given as a response; (2) the amount of time that elapses before a response is given; and (3) the number of respondents who do not respond at all to a test word within a reasonable period of time.
Word AssociationEXAMPLE STIMULUS MRS. M MRS. C washday everyday ironing fresh and sweet clean pure air soiled scrub dont; husband does clean filth this neighborhood dirt bubbles bath soap and water family squabbles children towels dirty ash w
Completion Techniques In Sentence completion, respondents are given incomplete sentences and asked to complete them. Generally, they are asked to use the first word or phrase that comes to mind. A person who shops at Sears is ______________________ A person who receives a gift certificate good for Saks Fifth Avenue would be __________________________________ J. C. Penney is most liked by _________________________ When I think of shopping in a department store, I ________ A variation of sentence completion is paragraph completion, in which the respondent completes a paragraph beginning with the stimulus phrase.
Completion Techniques In story completion, respondents are given part of a story – enough to direct attention to a particular topic but not to hint at the ending. They are required to give the conclusion in their own words.
Construction Techniques With a picture response, the respondents are asked to describe a series of pictures of ordinary as well as unusual events. The respondents interpretation of the pictures gives indications of that individuals personality. In cartoon tests, cartoon characters are shown in a specific situation related to the problem. The respondents are asked to indicate what one cartoon character might say in response to the comments of another character. Cartoon tests are simpler to administer and analyze than picture response techniques.
A Cartoon Test Figure 5.4 Sears Let’s see if we can pick up some house wares at Sears
Expressive Techniques In expressive techniques, respondents are presented with a verbal or visual situation and asked to relate the feelings and attitudes of other people to the situation. Role playing Respondents are asked to play the role or assume the behavior of someone else. Third-person technique The respondent is presented with a verbal or visual situation and the respondent is asked to relate the beliefs and attitudes of a third person rather than directly expressing personal beliefs and attitudes. This third person may be a friend, neighbor, colleague, or a “typical” person.
Advantages of ProjectiveTechniques • They may elicit responses that subjects would be unwilling or unable to give if they knew the purpose of the study. • Helpful when the issues to be addressed are personal, sensitive, or subject to strong social norms. • Helpful when underlying motivations, beliefs, and attitudes are operating at a subconscious level.
Disadvantages of Projective Techniques• Suffer from many of the disadvantages of unstructured direct techniques, but to a greater extent. • Require highly trained interviewers. • Skilled interpreters are also required to analyze the responses. • There is a serious risk of interpretation bias. • They tend to be expensive. • May require respondents to engage in unusual behavior.
Guidelines for Using Projective Techniques• Projective techniques should be used because the required information cannot be accurately obtained by direct methods.• Projective techniques should be used for exploratory research to gain initial insights and understanding.• Given their complexity, projective techniques should not be used naively.
Comparison of Focus Groups, Depth Interviews, and Projective Techniques Table 5.3Criteria Focus Depth Interviews Projective Groups Techniques1. Degree of Structure Relatively high Relatively medium Relatively low2. Probing of individual Low High Medium respondents 3. Moderator bias Relatively medium Relatively high Low to high4. Interpretation bias Relatively low Relatively medium Relatively high5. Uncovering Low Medium to high High subconscious information 6. Discovering innovative information High Medium Low7. Obtaining sensitive information Low Medium High8. Involve unusual behavior or questioning No To a limited extent Yes9. Overall usefulness Useful Highly useful Somewhat useful
Advantages of Online FocusGroups • Geographical constraints are removed and time constraints are lessened. • Unique opportunity to re-contact group participants at a later date. • Can recruit people not interested in traditional focus groups: doctors, lawyers, etc. • Moderators can carry on side conversations with individual respondents. • There is no travel, video taping, or facilities to arrange; so the cost is much lower.
Disadvantages of Online Focus Groups • Only people that have access to the Internet can participate. • Verifying that a respondent is a member of a target group is difficult. • There is lack of general control over the respondents environment. • Only audio and visual stimuli can be tested. Products can not be touched (e.g., clothing) or smelled (e.g., perfumes).
Chapter SixDescriptive Research Design: Survey and Observation
A Classification of Survey Methods Fig. 6.1 Survey Methods Telephone Personal Mail Electronic In-Home Mall Computer-Assisted Internet E-mail Intercept Personal InterviewingTraditional Computer-Assisted Mail MailTelephone Telephone Interview Panel Interviewing
Some Decisions Related to the Mail Interview Package Table 6.1Outgoing EnvelopeOutgoing envelope: size, color, return addressPostage Method of addressingCover LetterSponsorship Type of appeal PostscriptPersonalization SignatureQuestionnaireLength Size Layout FormatContent Reproduction Color Respondent anonymityReturn EnvelopeType of envelope PostageIncentivesMonetary versus non-monetary Prepaid versus promised amount
Criteria for Evaluating Survey MethodsFlexibility of Data Collection• The flexibility of data collection is determined primarily by the extent to which the respondent can interact with the interviewer and the survey questionnaire. Diversity of Questions• The diversity of questions that can be asked in a survey depends upon the degree of interaction the respondent has with the interviewer and the questionnaire, as well as the ability to actually see the questions. Use of Physical Stimuli• The ability to use physical stimuli such as the product, a product prototype, commercials, or promotional displays during the interview.
Criteria for Evaluating Survey MethodsSample Control• Sample control is the ability of the survey mode to reach the units specified in the sample effectively and efficiently.Control of the Data Collection Environment• The degree of control a researcher has over the environment in which the respondent answers the questionnaire. Control of Field Force• The ability to control the interviewers and supervisors involved in data collection. Quantity of Data• The ability to collect large amounts of data.
Criteria for Evaluating Survey MethodsResponse Rate• Survey response rate is broadly defined as the percentage of the total attempted interviews that are completed. Perceived Anonymity• Perceived anonymity refers to the respondents perceptions that their identities will not be discerned by the interviewer or the researcher. Social Desirability/Sensitive Information• Social desirability is the tendency of the respondents to give answers that are socially acceptable, whether or not they are true.
Criteria for Evaluating Survey Methods Potential for Interviewer Bias • The extent of the interviewers role determines the potential for bias. Speed • The total time taken for administering the survey to the entire sample. Cost • The total cost of administering the survey and collecting the data.
A Comparative Evaluation of Survey Methods Table 6.2 Mall-Criteria Phone/ In-Home Intercept Mail Mail CATI Interviews Interviews CAPI Surveys Panels E-Mail InternetFlexibility of data Moderate High High Moderate Low Low Low Moderatecollection to high to high to highDiversity of questions Low High High High Moderate Moderate Moderate Moderate to highUse of physical stimuli Low Moderate High High Moderate Moderate Low Moderate to highSample control Moderate Potentially Moderate Moderate Low Moderate Low Low to to high high to high moderateControl of data collection Moderate Moderate High High Low Low Low Lowenvironment to highControl of field force Moderate Low Moderate Moderate High High High HighQuantity of data Low High Moderate Moderate Moderate High Moderate ModerateResponse rate Moderate High High High Low Moderate Low Very LowPerceived anonymity of Moderate Low Low Low High High Moderate Highthe respondentSocial desirability Moderate High High Moderate Low Low Moderate Low to HighObtaining sensitive High Low Low Low to High Moderate Moderate Highinformation moderate to HighPotential for interviewer Moderate High High Low None None None NonebiasSpeed High Moderate Moderate Moderate Low Low to High Very to high to high moderate highCost Moderate High Moderate Moderate Low Low to Low Low to high to high moderate
Observation Methods Structured versus Unstructured Observation • For structured observation, the researcher specifies in detail what is to be observed and how the measurements are to be recorded, e.g., an auditor performing inventory analysis in a store. • In unstructured observation, the observer monitors all aspects of the phenomenon that seem relevant to the problem at hand, e.g., observing children playing with new toys.
Observation Methods Disguised versus Undisguised Observation • In disguised observation, the respondents are unaware that they are being observed. Disguise may be accomplished by using one-way mirrors, hidden cameras, or inconspicuous mechanical devices. Observers may be disguised as shoppers or sales clerks. • In undisguised observation, the respondents are aware that they are under observation.
Observation Methods Natural versus Contrived Observation • Natural observation involves observing behavior as it takes places in the environment. For example, one could observe the behavior of respondents eating fast food in Burger King. • In contrived observation, respondents behavior is observed in an artificial environment, such as a test kitchen.
A Classification of Observation Methods Fig. 6.3 Classifying Observation Methods Observation Methods Personal Mechanical Audit Content TraceObservation Observation Analysis Analysis
Observation Methods Personal Observation• A researcher observes actual behavior as it occurs. • The observer does not attempt to manipulate the phenomenon being observed but merely records what takes place. • For example, a researcher might record traffic counts and observe traffic flows in a department store.
Observation Methods Mechanical Observation Do not require respondents direct participation. • the AC Nielsen audimeter • turnstiles that record the number of people entering or leaving a building. • On-site cameras (still, motion picture, or video) • Optical scanners in supermarkets Do require respondent involvement. • eye-tracking monitors • pupilometers • psychogalvanometers • voice pitch analyzers • devices measuring response latency
Observation Methods Audit• The researcher collects data by examining physical records or performing inventory analysis. • Data are collected personally by the researcher. • The data are based upon counts, usually of physical objects.
Observation Methods Content Analysis• The objective, systematic, and quantitative description of the manifest content of a communication. • The unit of analysis may be words, characters (individuals or objects), themes (propositions), space and time measures (length or duration of the message), or topics (subject of the message). • Analytical categories for classifying the units are developed and the communication is broken down according to prescribed rules.
Observation Methods Trace AnalysisData collection is based on physical traces, or evidence, of pastbehavior. • The selective erosion of tiles in a museum indexed by the replacement rate was used to determine the relative popularity of exhibits.• The number of different fingerprints on a page was used to gauge the readership of various advertisements in a magazine.• The position of the radio dials in cars brought in for service was used to estimate share of listening audience of various radio stations. • The age and condition of cars in a parking lot were used to assess the affluence of customers.• The magazines people donated to charity were used to determine peoples favorite magazines.• Internet visitors leave traces which can be analyzed to examine browsing and usage behavior by using cookies.
A Comparative Evaluation of Observation Methods Table 6.3Criteria Personal Mechanical Audit Content Trace Observation Observation Analysis Analysis AnalysisDegree of structure Low Low to high High High MediumDegree of disguise Medium Low to high Low High HighAbility to observe High Low to high High Medium Lowin natural settingObservation bias High Low Low Medium MediumAnalysis Bias High Low to Low Low Medium MediumGeneral remarks Most Can be Expensive Limited to Method of flexible intrusive commu- last resort nications
Relative Advantages ofObservation• They permit measurement of actual behavior rather than reports of intended or preferred behavior. • There is no reporting bias, and potential bias caused by the interviewer and the interviewing process is eliminated or reduced. • Certain types of data can be collected only by observation. • If the observed phenomenon occurs frequently or is of short duration, observational methods may be cheaper and faster than survey methods.
Relative Disadvantages of Observation • The reasons for the observed behavior may not be determined since little is known about the underlying motives, beliefs, attitudes, and preferences. • Selective perception (bias in the researchers perception) can bias the data. • Observational data are often time-consuming and expensive, and it is difficult to observe certain forms of behavior. • In some cases, the use of observational methods may be unethical, as in observing people without their knowledge or consent. It is best to view observation as a complement to survey methods, rather than as being in competition with them.
A Comparative Evaluation of Survey Methods for International Marketing Research Table 6.4Criteria Telephone Personal Mail ElectronicHigh sample control + + - -Difficulty in locating + - + +respondents at homeInaccessibility of homes + - + +Unavailability of a large + - + +pool of trained interviewersLarge population in rural areas - + - -Unavailability of maps + - + +Unavailability of current - + - +telephone directoryUnavailability of mailing lists + + - +Low penetration of telephones - + + -Lack of an efficient postal system + + - +Low level of literacy - + - -Face-to-face communication culture - + - -Poor access to computers & Internet ? + ? -Note: A (+) denotes an advantage, and a (–) denotes a disadvantage.
Chapter SevenCausal Research Design: Experimentation
Concept of Causality A statement such as "X causes Y " will have the following meaning to an ordinary person and to a scientist. ____________________________________________________ Ordinary Meaning Scientific Meaning ____________________________________________________ X is the only cause of Y. X is only one of a number of possible causes of Y. X must always lead to Y The occurrence of X makes the (X is a deterministic occurrence of Y more probable cause of Y). (X is a probabilistic cause of Y). It is possible to prove We can never prove that X is a that X is a cause of Y. cause of Y. At best, we can infer that X is a cause of Y. ____________________________________________________
Conditions for Causality• Concomitant variation is the extent to which a cause, X, and an effect, Y, occur together or vary together in the way predicted by the hypothesis under consideration. • The time order of occurrence condition states that the causing event must occur either before or simultaneously with the effect; it cannot occur afterwards. • The absence of other possible causal factors means that the factor or variable being investigated should be the only possible causal explanation.
Evidence of Concomitant Variation between Purchase of Fashion Clothing and Education Table 7.1 Purchase of Fashion Clothing, Y High Low Education, X High 363 (73%) 137 (27%) 500 (100%) Low 322 (64%) 178 (36%) 500 (100%)
Purchase of Fashion Clothing By Income and Education Low Income High Income Purchase Purchase High Low High Low High 122 (61%) 78 (39%) 200 (100%) High 241 (80%) 59 (20%) 300 EducationEducation 171 (57%) 129 (43%) 300 (100%) Low 151 (76%) 49 (24%) 200 Low
Definitions and Concepts• Independent variables are variables or alternatives that are manipulated and whose effects are measured and compared, e.g., price levels. • Test units are individuals, organizations, or other entities whose response to the independent variables or treatments is being examined, e.g., consumers or stores. • Dependent variables are the variables which measure the effect of the independent variables on the test units, e.g., sales, profits, and market shares. • Extraneous variables are all variables other than the independent variables that affect the response of the test units, e.g., store size, store location, and competitive effort.
Experimental Design An experimental design is a set of procedures specifying • the test units and how these units are to be divided into homogeneous subsamples, • what independent variables or treatments are to be manipulated, • what dependent variables are to be measured, and • how the extraneous variables are to be controlled.
Validity in Experimentation• Internal validity refers to whether the manipulation of the independent variables or treatments actually caused the observed effects on the dependent variables. Control of extraneous variables is a necessary condition for establishing internal validity.• External validity refers to whether the cause-and- effect relationships found in the experiment can be generalized. To what populations, settings, times, independent variables and dependent variables can the results be projected?
Extraneous Variables• History refers to specific events that are external to the experiment but occur at the same time as the experiment.• Maturation (MA) refers to changes in the test units themselves that occur with the passage of time. • Testing effects are caused by the process of experimentation. Typically, these are the effects on the experiment of taking a measure on the dependent variable before and after the presentation of the treatment. • The main testing effect (MT) occurs when a prior observation affects a latter observation.
Extraneous Variables• In the interactive testing effect (IT), a prior measurement affects the test units response to the independent variable. • Instrumentation (I) refers to changes in the measuring instrument, in the observers or in the scores themselves. • Statistical regression effects (SR) occur when test units with extreme scores move closer to the average score during the course of the experiment. • Selection bias (SB) refers to the improper assignment of test units to treatment conditions. • Mortality (MO) refers to the loss of test units while the experiment is in progress.
Controlling Extraneous Variables• Randomization refers to the random assignment of test units to experimental groups by using random numbers. Treatment conditions are also randomly assigned to experimental groups.• Matching involves comparing test units on a set of key background variables before assigning them to the treatment conditions. • Statistical control involves measuring the extraneous variables and adjusting for their effects through statistical analysis.• Design control involves the use of experiments designed to control specific extraneous variables.
Limitations of Experimentation• Experiments can be time consuming, particularly if the researcher is interested in measuring the long- term effects.• Experiments are often expensive. The requirements of experimental group, control group, and multiple measurements significantly add to the cost of research.• Experiments can be difficult to administer. It may be impossible to control for the effects of the extraneous variables, particularly in a field environment. • Competitors may deliberately contaminate the results of a field experiment.
ChapterScaling: Fundamentals and ComparativeMeasurement and EightScaling
Measurement and Scaling Measurement means assigning numbers or other symbols to characteristics of objects according to certain prespecified rules. • One-to-one correspondence between the numbers and the characteristics being measured. • The rules for assigning numbers should be standardized and applied uniformly. • Rules must not change over objects or time.
Measurement and Scaling Scaling involves creating a continuum upon which measured objects are located. Consider an attitude scale from 1 to 100. Each respondent is assigned a number from 1 to 100, with 1 = Extremely Unfavorable, and 100 = Extremely Favorable. Measurement is the actual assignment of a number from 1 to 100 to each respondent. Scaling is the process of placing the respondents on a continuum with respect to their attitude toward department stores.
Primary Scales of Measurement Figure 8.1ScaleNominal Numbers Finish Assigned 7 8 3 to RunnersOrdinal Rank Order Finish of Winners Third Second First place place placeInterval Performance Rating on a 8.2 9.1 9.6 0 to 10 ScaleRatio Time to Finish, in 15.2 14.1 13.4 Seconds
Primary Scales of Measurement Nominal Scale• The numbers serve only as labels or tags for identifying and classifying objects. • When used for identification, there is a strict one-to-one correspondence between the numbers and the objects. • The numbers do not reflect the amount of the characteristic possessed by the objects. • The only permissible operation on the numbers in a nominal scale is counting. • Only a limited number of statistics, all of which are based on frequency counts, are permissible, e.g., percentages, and mode.
Primary Scales of Measurement Ordinal Scale• A ranking scale in which numbers are assigned to objects to indicate the relative extent to which the objects possess some characteristic. • Can determine whether an object has more or less of a characteristic than some other object, but not how much more or less. • Any series of numbers can be assigned that preserves the ordered relationships between the objects. • In addition to the counting operation allowable for nominal scale data, ordinal scales permit the use of statistics based on centiles, e.g., percentile, quartile, median.
Primary Scales of Measurement Interval Scale• Numerically equal distances on the scale represent equal values in the characteristic being measured. • It permits comparison of the differences between objects. • The location of the zero point is not fixed. Both the zero point and the units of measurement are arbitrary. • Any positive linear transformation of the form y = a + bx will preserve the properties of the scale. • It is meaningful to take ratios of scale values. • Statistical techniques that may be used include all of those that can be applied to nominal and ordinal data, and in addition the arithmetic mean, standard deviation, and other statistics commonly used in marketing research.
Primary Scales of Measurement Ratio Scale• Possesses all the properties of the nominal, ordinal, and interval scales.• It has an absolute zero point. • It is meaningful to compute ratios of scale values. • Only proportionate transformations of the form y = bx, where b is a positive constant, are allowed. • All statistical techniques can be applied to ratio data.
Primary Scales of Measurement Table 8.1Scale Basic Common Marketing Permissible Statistics Characteristics Examples Examples Descriptive InferentialNominal Numbers identify Social Security Brand nos., store Percentages, Chi-square, & classify objects nos., numbering types mode binomial test of football playersOrdinal Nos. indicate the Quality rankings, Preference Percentile, Rank-order relative positions rankings of teams rankings, market median correlation, of objects but not in a tournament position, social Friedman the magnitude of class ANOVA differences between themInterval Differences Temperature Attitudes, Range, mean, Product- between objects (Fahrenheit) opinions, index standard momentRatio Zero point is fixed, Length, weight Age, sales, Geometric Coefficient of ratios of scale income, costs mean, harmonic variation values can be mean compared
A Classification of Scaling Techniques Scaling Techniques Comparative Noncomparative Scales ScalesPaired Rank Constant Q-Sort and Continuous ItemizedComparison Order Sum Other Rating Scales Rating Scales Procedures Semantic Stapel Likert Differential
A Comparison of ScalingTechniques• Comparative scales involve the direct comparison of stimulus objects. Comparative scale data must be interpreted in relative terms and have only ordinal or rank order properties. • In noncomparative scales, each object is scaled independently of the others in the stimulus set. The resulting data are generally assumed to be interval or ratio scaled.
Relative Advantages of Comparative Scales• Small differences between stimulus objects can be detected.• Same known reference points for all respondents. • Easily understood and can be applied. • Involve fewer theoretical assumptions.• Tend to reduce halo or carryover effects from one judgment to another.
Relative Disadvantages of ComparativeScales• Ordinal nature of the data • Inability to generalize beyond the stimulus objects scaled.
Comparative Scaling Techniques Paired Comparison Scaling• A respondent is presented with two objects and asked to select one according to some criterion. • The data obtained are ordinal in nature. • Paired comparison scaling is the most widely used comparative scaling technique.• With n brands, [n(n - 1) /2] paired comparisons are required• Under the assumption of transitivity, it is possible to convert paired comparison data to a rank order.