Marketing Research, Applications of Product Development and Test Marketing, Sale forecasting and Ethical Issues in Marketing Research

1. Presented by,
Saneem Nazim,
S4 MBA,
Roll No: 12
CHMM College

2. “Marketing research is the systematic gathering,
recording and analyzing of the data about the
marketing problems towards the end of providing
information useful in marketing decision making.”
-Still and Cundiff
Definition

3. Research includes:
Sales research
Product research
Advertising research
Motivation research
Service marketing research
Micro environmental research

4. Product Research
Product market research serves several goals: new product
design and market validation research, or assessing
existing product strength and line extension potential.
Concept Testing
Concept testing research evaluates advertising concepts, ad
theme concepts and appeals, new product concepts,
pricing, brand concepts, brand names, and positioning
strategy concepts.
Applications of Market Research

5. Branding Research
Branding decisions drive branding marketing research
strategy. Brand Management and Research services help
to understand the brand's value, strengths and
vulnerabilities and increase the brand position
Brand Equity Research
Brand equity research measures the breadth and depth of
brand power in the target markets. A key to research
design is the goal of a brand equity measurement study.

6. Advertising Research
Advertising research design is determined by specific
advertising goals and the stage of ad development, or
campaign.
Pricing Research
Various types of research used to explore the role of price,
optimal pricing, and pricing demand curves
Sales Analysis
An analysis of sales by period or year to project trends,
identify problems and measure a retailer's performance

7. Positioning Research
Studies designed to help identify the optimal positioning for
a brand or service
Market Segmentation
Market segmentation is a process by which market
researchers identify key attributes about customers and
potential consumers that can be used to create distinct
target market groups
Customer Satisfaction Research
It is area of marketing research which focuses on customers'
perceptions with their shopping or purchase experience.

8. I. Defining the problem and setting the objectives:
The definition of the problem helps in determining the
techniques to be used, the extent of information to be
collected. After defining the basic problem, the researcher
must specify the objective of the study.
II. Conducting situational analysis:
It means collecting the information about the business
environment.
Marketing Research Process

9. III. Conducting an informal investigation:
The researcher must conduct an informal investigation with
the people outside the company, like wholesalers,
advertising agencies, consumers etc.
IV. Planning and conducting a formal investigation:
It includes
a) Selecting the source of information
b) Deciding methods of data collection
c) Preparing frames and forms
d) Pre-testing the forms
e) Planning the samples
f) Collecting the data

10. V. Analyzing and Interpreting data:
Data analysis and interpretation is the process of assigning
meaning to the collected information and determining
the conclusions, significance, and implications of the
findings.
VI. Preparing a written report
Making the written report clearly presented and
highlighting the findings and the decision maker
should be able to take decision effectively after going
through the findings and recommendations.

11. Research is not guarantee of success
Lack of adequate knowledge of marketing research
Research is based on sample and sampling research lacks the
complete accuracy
Trained personnel and a lot of time is required for marketing
research
It is difficult to evaluate the economic benefits derived by
marketing research
Limitation of Marketing Research

12. It can't give 100% accurate results
It provides suggestions and not solutions.
Marketing research is a costly affair.
It can't predict consumer behaviour.(changing the
behaviour of consumers)
Long time is required in the marketing research
procedures

13. PREPARED BY:
SREEJA

14. Introduction
 Market research is the process by which businesses find out
about customers' needs, wants and desires. It makes
possible the successful development of new products.
 New product development should start with an insight
based on consumer needs.
 Throughout the NPD process and test marketing, market
research is a valuable tool to check viability and minimize
the risk of the product launches.

15. PRODUCT DEVELOPMENT
NEW PRODUCT PLANNING PROCESS
 The new product planning is the function of the top
management personnel & specialists drawn from sales &
marketing, research & development, manufacturing &
finance.
PHASES OF NEW PRODUCT DEVELOPMENT
 Idea generation:- The first stage is on searching for new
product ideas. An important source of new product
ideas is customers.
 Screening of ideas:- It means critical evaluation of
product ideas generated. The main objective of
screening is to abandon those ideas which are
inconsistent with the product policy of the firm.

16.  Concept testing:- At this stage the product concept itself
is tested. It helps the company to choose the best among
the alternative products.
 Market analysis:- Estimates of sales, costs & profits are
important components of market analysis.
 Product development:- The product is shaped
corresponding to the needs & desire of the buyers.
 Test marketing:- By test marketing we mean, by trial &
error method when a product is introduced into the
market.
 Commercialization:- At this stage production starts,
marketing programme begins to operate & products are
into the market for sale.

17. CONSIDER THE FOLLOWING BEFORE LAUNCHING
A PRODUCT:-
 Effective market research
 Ensure product policy
 Identification of consumer needs
 Effective promotion
 Proper distribution system
 Correct pricing strategy

18. TEST MARKETING
 Test marketing is an application of a controlled
experiment, done in limited but carefully selected
parts of the marketplace called test markets.
Test marketing procedures may be classified as follows:-
 Standard test market:- In standard test market the
products are sold through regular distribution channels.
 Controlled test market:- In controlled test market the
entire test-marketing program is conducted by an outside
research company. The research company guarantees
distribution of the product in retail outlets that represent a
percentage of the market.

19. Application of market research in product
development and test marketing
 Market research involves the systematic
gathering, recording and analyzing of data about
customers, competitors and the market. This links
marketers to consumers by supplying essential information
to solve marketing challenges and help with marketing
decisions. Market research helps a company create and
develop an up-to-date and relevant portfolio of products

20. Identifying consumer insights and
product needs - where to start?
 Market research should start with the consumer and
serves two purposes:
 1) To inform companies about consumer needs and
desires. What are the trends in the market? What do
consumers want?
 2) To give consumers the opportunity to talk to the
providers of products and services so that their views
are taken into account.

21. Turning consumer insights into
product concepts
 The team generated ideas on how to address the
consumer need. From these ideas the marketing team
created 'product concepts'. These describe the product
benefits and how they will meet the consumer needs.
Several concepts were written in different ways. These
explained and expressed unique product attributes

22. APPLICATION OF TEST MARKETING
How large a plant is needed for national sales?
Which cities should be selected to run the test?
What should be the optimum expenditure on
production?
What would be the return on investment?
What time period is required to run the test?
What specific information should be collected during
the test?
What action should be taken after the test?

23. SEGMENTATION
 The process of dividing the market into homogeneous
markets with similar characteristics is called market
segmentation.
CRITERIA FOR MARKET SEGMENTATION
 Identity :- There must be clear differences between
segments. Members of such segments can be
identified by common characteristics which display
similar behavior.
 Accessibility :- It must be possible to reach the
different segments in regard to both promotion &
distribution.

24.  Responsiveness:- A clearly defined segment must react
to changes in any of the elements of the marketing
mix.
 Size:- The segment must be reasonably large enough to
be a profitable target.
 Nature of demand:- It refers to the different quantities
demanded by various segments.
 Measurability:- The purpose of segmentation is to
measure the changing behavior pattern of consumers.

25. EXAMPLE
Refrigerators: The market can be segmented on the
basis of:-
 Geographical:- North India,South India,East India
 Size of refrigerators:-65 Litres,90 Litres,165 Litres
 Nature of consumers:- Households, Indusrial

26. Prepared By:-
Sreeji.J.R

27. Sales Forecasting
 Sales forecasting is a difficult area of management. Most
managers believe they are good at forecasting. However,
forecasts made usually turn out to be wrong!
Market Forecast refers to the estimates of future sales of a
company’s products in the market.
Sales forecasting is very popular in industrially advanced
countries where demand conditions are always uncertain than
the supply conditions.

28. Reasons for undertaking Sales Forecast
Businesses are forced to look well ahead in order to
plan their investments, launch new products, decide
when to close or withdraw products and so on.
The sales forecasting process is a critical one for most
businesses.
Key decisions that are derived from a sales forecast
include:-
- Employment levels required
- Promotional mix
- Investment in production capacity

29. Types Of Forecasting
There are two major types of forecasting, which can be
broadly described as macro and micro:
 Macro forecasting is concerned with forecasting markets
in total. This is about determining the existing level of
Market Demand and considering what will happen to
market demand in the future.
 Micro forecasting is concerned with detailed unit sales
forecasts. This is about determining a product’s market
share in a particular industry and considering what will
happen to that market share in the future.

30. Selection Of Forecasting
 The selection of which type of forecasting is used
depends on the several factors which can be described
as:
(1) The degree of accuracy required – if the
decisions that are to be made on the basis of the
sales forecast have high risks attached to them,
then it stands to reason that the forecast should
be prepared as accurately as possible. However,
this involves more cost

31. (2) The availability of data and information - in some
markets there is a wealth of available sales information
(e.g. clothing retail, food retailing); in others it is hard to
find reliable, up-to-date information.
(3) The time horizon that the sales forecast is intended to
cover. For example; forecasting next weeks’ sales, or
trying to forecast what will happen to the overall size of
the market in the next five years?
(4) The position of the products in its life cycle.
For example, for products at the “introductory” stage of
the product life cycle, less sales data and information
may be available than for products at the “maturity”
stage when time series can be a useful forecasting
method.

32. A common method of preparing a sales forecast
has three stages
1) Prepare a macroeconomic forecast – what will
happen to overall economic activity in the relevant
economies in which a product is to be sold.
2) Prepare an industry sales forecast – what will
happen to overall sales in an industry based on the
issues that influence the macroeconomic forecast.
3) Prepare a company sales forecast – based on
what management expect to happen to the
company’s market share.

33. Forecasting Process
Forecast Objective
Evaluate Result versus
forecast
Determined
independent and
dependent
variables
Total forecast
Procedure
Select forecast
Analysis method
Develop Forecast
Procedure
Gather & analyze
data
Present assumption
about data
Make & finalize
forecast

34. METHODS OF FORECASTING.
Some of the methods used in forecasting are:
 user expectations
 sales force composite
 jury of executive opinion
 Delphi technique
 market test
 Time series analysis method

35. Purposes Of Forecasting
 Appropriate production scheduling
 Reducing cost of purchasing raw materials
 Determining appropriate price policy
 Setting sales targets and establishing controls and incentives
 Evolving a suitable promotional program
 Forecasting short-term financial requirements
 Planning of a new unit or expansion of an existing unit
 Planning of long-term financial requirements
 Planning of man-power requirements

36. Prepared by:
Ismayil Khalam

37. What are Ethics?
 Ethics are a collection of principles of right conduct
that shape the decisions that people or organizations
make.
 Practicing ethics in marketing means deliberately
applying standards of fairness, or moral rights and
wrongs, to marketing decision making, behavior, and
practice in the organization.

38. What is marketing research?
 Marketing Research is the systematic and objective
identification,collection,analysis,and use of
information for the purpose of improving decision
making related to the identification and solution of
problems and opportunities in marketing.

39. Importance of ethics in research:
 Promote the aims of researcher
 Promote values
 Accountable to public
 Public support

40. Types of organization
 Ethical Base-
when an organization behaves ethically, customers
develop more positive attitudes about the firm, its
products, and its services.
 Non-Ethical Base-
Not employing ethical marketing practices may lead
to dissatisfied customers, bad publicity, a lack of trust,
lost business, or, sometimes legal action.

41. Problems:
 Three key areas where problems often arise in
marketing research:
1. In the relationship between the researcher and the
client
2. Between the researcher and the research subject
3. Between the researcher and the marketing research
industry

42. Ethical principles:
 Honesty
 Objectivity
 Integrity
 Carefulness
 Openness
 Respect for intellectual prosperity
 Confidentiality
 Social responsibility

43. Ethics and Marketing Research
• AMA Code of Ethics
• Prohibiting and selling (sugging) or fund
raising (frugging) under the guise of
conducting research
• Maintaining research integrity by avoiding
misrepresentation and omission of pertinent
research data
• Treating others (buyers and suppliers) fairly

44. Ethical Issues in Marketing
Research
 Marketing ethics
 The application of morals to behavior related to the
exchange environment.
 Moral standards
 Principles that reflect beliefs about what is ethical
and what is unethical.
 Ethical dilemma
 A situation in which one chooses from alternative
courses of actions, each with different ethical
implications.

45. Ethical Issues in Marketing
Research (cont’d)
 Relativism
 A term that reflects the degree to which one rejects
moral standards in favor of the acceptability of some
action.
 This way of thinking rejects absolute principles in
favor of situation-based evaluations.
 Idealism
 A term that reflects the degree to which one bases
one’s morality on moral standards.
 example: the Golden Rule

46. Ethical Issues in Marketing Research
Excessive interviewing
Lack of consideration
Abuse of respondents
Delivering sales pitches
under the guise of
marketing research

47. Ethical Issues in Marketing Research
Incomplete reporting
of results
Misleading reporting
of results
Nonobjective research
Use of data and the
confidentiality of information
collected

48. THANKYOU