>chapter 4

The Marketing Research Process: An Overview

>learningobjectives
After reading this chapter, you should understand . . . 1 Research is decision- and dilemma-centered. 2 The clarified research question is the result of careful exploration and analysis and sets the direction for the research project. 3 How value assessments and budgeting influence the process for proposing research and, ultimately, research design. 4 What is included in research design, data collection, and data analysis. 5 Research process problems to avoid.

>behindthescenes
We rejoin Visionary Insights Jason Henry as he works on the MindWriter CompleteCare customer satisfaction project. At this stage in the MindWriter research MindWriter process, Jason Henrys task is to help MindWriters project director, Myra Wines, define the correct information to collect. Henry and Wines have just spent the day at the CompleteCare facility in Austin and with other MindWriter managers who are influential to CompleteCares success. They spent much of their time with Gracie Uhura, MindWriters marketing manager.

On the return flight from Austin, Visionary Insights Jason Henry and MindWriters Myra Wines are discussing their trip. That went really well, she says. There are going to be a few problems, disagrees Jason. Gracie, like most marketing managers, wants the sun, the sky, and the moon. She wants to know the demographic characteristics of her users . . . their job descriptions . . . their salaries . . . their ethnicities . . . their education; wants to know their perception of MindWriter . . . of the quality of MindWriters specific models; wants to know their satisfaction with the purchase channel and with the CompleteCare service, too. And your point is? asks Myra. You and Gracie need to keep your eye on the bottom line. You can bet someone will want to know how you and Gracie can justify asking all these questions. They will ask, What is going to be the payoff in knowing the ethnicity of customers? And if you or Gracie cant explain the justification for needing the information, if one of you cant establish that the dollar benefit of knowing is at least as great as the dollar cost of finding out, the question will get struck from the developing research. Is there no way we can justify knowing everything Gracie wants to know? inquires Myra. We can draft a survey and do a pilot study of a few hundred customers and see if the ethnic background, or the salary level, or any other item that Gracie cares about is a good indicator of satisfaction, willingness to make a repeat purchase, postpurchase service satisfac-

tion, and so forth. If it is, maybe collecting that information can be justified. So you feel we need to propose a pilot study to whittle down the information needed to critical items, followed by a larger study later? A pilot study could help in other ways, too. Gracie wants to know the customers perception of MindWriters overall quality. But we have to ask ourselves, Are these customers really qualified to form independent opinions, or will they simply be parroting what they have read in the computer magazines or what a dealer told them? A pilot study of a few hundred users can help determine if it is really useful to ask them their overall impression of the product. However, with the repair problem we can be reasonably sure that the CompleteCare customers know their own minds when it comes to evaluating their firsthand experience with MindWriters service department. Todays tour of the CompleteCare facility really helped me understand the context of managements concerns, comments Myra. Did you or Sara have a chance to look over any of the customer letters from the service department? Jason digs into his briefcase and extracts a small sheaf of photocopies. Yes, and Sara reviewed transcriptions, too, on service center phone conversations. She pulled a few for us. One person writes, My MindWriter was badly damaged on arrival. I could not believe its condition when I unpacked it. And here, The service technicians seemed to be unable to understand

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>behindthescenescontd
my complaint, but once they understood it, they performed immediate repairs. You and I will collaborate to boil down these, and possibly dozens more like them, to a couple of representative questions that can be pilot-tested for clarity, consistency, and representativeness. You dont want MindWriter to pay for everything Gracie says she wants, just what she wants that has a payoff and is researchable.

> The Marketing Research Process

Writers usually treat the research task as a sequential process involving several clearly defined steps. No one claims that research requires completion of each step before going to the next. Recycling, circumventing, and skipping occur. Some steps are begun out of sequence, some are carried out simultaneously, and some may be omitted. Despite these variations, the idea of a sequence is useful for developing a project and for keeping the project orderly as it unfolds. Exhibit 4-1 models the sequence of stages in the research process. We refer to it often as we discuss each stage and step in subsequent chapters. Our discussion of the questions that guide project planning and data gathering is incorporated into the model (see the elements within the inverted pyramid in Exhibit 4-1 and compare them with the elements in Exhibit 4-2). Exhibit 4-1 also organizes this chapter and introduces the remainder of the book. The research process begins much as the opening vignette suggests. A management dilemma triggers the need for a decision. For MindWriter, a growing number of complaints about postpurchase service started the process. In other situations, a controversy arises, a major commitment of resources is called for, or conditions in the environment signal the need for a decision. For MindWriter, the critical event could have been a competitors introduction of new technology. Such events cause managers to reconsider their purposes or objectives, define a problem for solution, or develop strategies for solutions they have identified. In our view of the research process, the management question its origin, selection, statement, exploration, and refinementis the critical activity in the sequence. Throughout the chapter we emphasize problem-related steps. A familiar quotation from Albert Einstein, no less apt today than when it was written, supports this view:

research process various decision stages involved in a research project and the relationship between those stages.

The primary purpose of research is to reduce the level of risk of a marketing decision. Knowing that most new product introductions fail, this humorous ad from Greenfield Online suggests that not all new product ideas are worthy of consideration and that wellexecuted research can save a firm from a costly mistake. www.greenfieldonline.com

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> Exhibit 4-1 The Marketing Research Process

Clarifying the Research Question Discover the Management Dilemma Define the Management Question Define the Research Question(s) Exploration Refine the Research Question(s) Exploration Stage 1 Stage 2 Sampling Design Stage 4 Stage 6 Stage 5 Stage 3 Chapter 18 Chapters 1922 Chapter 23 Chapters 35

Research Proposal

Chapter 6

Research Design Strategy (type, purpose, time frame, scope, environment)

Chapters 717

Data Collection Design

Instrument Development & Pilot Testing

Data Collection and Preparation

Legend Research planning Data gathering Analysis, interpretation Reporting

Data Analysis and Interpretation

Research Reporting

Management Decision

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The formulation of a problem is far more often essential than its solution, which may be merely a matter of mathematical or experimental skill. To raise new questions, new possibilities, to regard old problems from a new angle requires creative imagination and marks real advance in science.1

Whether the researcher is involved in basic or applied research, a thorough understanding of the management question is fundamental to success in the research enterprise.

> Stage 1: Clarifying the Research Question

A useful way to approach the research process is to state the basic dilemma that prompts the research and then try to develop other questions by progressively breaking down the original question into more specific ones. You can think of the this process as the management-research question hierarchy. You can follow the research process as it develops for MindWriter in Exhibit 4-2. The process begins at the most general level with the management dilemma. This is usually a symptom of an actual problem, such as: Rising costs. The discovery of an expensive chemical compound that would increase the efficacy of a drug. Increasing tenant move-outs from an apartment complex. Declining sales. A larger number of product defects during the manufacture of an automobile. An increasing number of letters and phone complaints about postpurchase service (as at MindWriter). The management dilemma can also be triggered by an early signal of an opportunity or growing evidence that a fad may be gaining staying powerlike the growing interest in low-carbohydrate diets indicated by the number of broadcast news segments and print news stories over an extended period of time. Identifying management dilemmas is rarely difficult (unless the organization fails to track its performance factorslike sales, profits, employee turnover, manufacturing output and defects, on-time deliveries, customer satisfaction, etc.). However, choosing one dilemma on which to focus may be difficult. Choosing incorrectly will direct valuable resources (time, manpower, money, and equipment) on a path that may not provide critical decision-making information (the purpose of good research). As a marketing manager, only practice makes you proficient at identifying which are real problems and which are not, as well as correctly discerning the scope of the dilemma to be researched. For new managers, or established managers facing new responsibilities, developing several management-research question hierarchies, each starting with a different

management-research question hierarchy process of sequential question formulation that leads a manager or researcher from management dilemma to investigative questions. management dilemma the problem or opportunity that requires a marketing decision.

Why? is a question that drives many a company to do marketing research. Harris Interactive is promising that if this guy is your customer, youll actually understand what makes him tickdollar-sign medallion and allby the time Harris finishes your research project. 2004, Harris Interactive Inc. All rights reserved. www.harrisinteractive.com

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> Exhibit 4-2 Formulating the Research Question for MindWriter

To move from the management dilemma to the management question and subsequent research questions takes exploratory research. Such research may include examining previous studies, reviewing published studies and organizational records, and interviewing experts or information gatekeepers.

1 Discover Management Dilemma 1a Exploration An increasing number of letters and phone complaints about postpurchase service.
Stage 1: Pre-Austin 1. PC magazines annual survey of service, repair & tech support 2. Published customer satisfaction comparisons Stage 2: Austin Meeting 1. Production: 5,000/mo. 2. Distribution through computer superstores and independent mail order co. 3. CustomCare process Stage 3: Post-Austin: Brainstorming & company letters 1. Possible problems: (a) Employee shortages (b) Tech-line operator training (c) Uneven courier performance (d) Parts shortages (e) Inconsistent repair servicing (f) Product damage during repair (g) Product damage during shipping (h) Packaging and handling problems

2 Define Management Question What should be done to improve the CompleteCare program for MindWriter product repairs and servicing?

2a Exploration Interviews with Service manager Call center manager Independent package company account executive

3 Define Research Question(s)

Should the tech-support operator be

given more intensive training

Should ABC Courier Service be

replaced by an air-transport service

Should the repair diagnostic and

repair sequencing operations be modified Should the return packaging be modified to include premolded rigid foam inserts, or conforming-expandable foam protection Should metropolitan repair centers be established to complement or replace in-factory repair facilities

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>snapshot
A Love-Match between Lexus and Research
If your product earns rave reviews for dependability/reliability, quality workmanship, and manufacturer reputation, thats good, right? If your firm delivers on the promise of your long-held promotional taglinethe Pursuit of Perfectionthats great, right? Not good enough, claims Mark Miller, associate director of strategic planning, Team One Advertising, when Toyota is determined to infuse the Lexus brand with passion. Toyota faced some troubling statistics in the 19971999 model years. While the Lexus brand was setting sales records and overall the luxury coupe category was growing, its Lexus coupe sales were declining. And while Lexus scored well on the rational motivators, it lacked the emotional motivators deemed critical for luxury coupe success, especially against Corvette, Porsche, and Mercedes. Toyota engineers had developed a concept car in Japan, the SC 430. This car was Toyotas first luxury convertible and sported a technologically advanced, retractable hard top rather than the more usual soft rag top. Team One was charged with developing the communications program to launch the SC 430. Understanding that this car was and needed to be a departure from traditional Lexus brand imagery, Team One needed information to accomplish Toyotas more aggressive agenda: (1) evolve the Lexus brand using the SC 430 convertible as the emotional flagship, (2) stimulate desire for the Lexus brand, as well as desire for the SC 430 convertible, (3) make a connection with luxury convertible buyers beyond the rational, and (4) inject more passion into our Pursuit of Perfection. Using syndicated tracking studies by Allison-Fisher and innovative quantitative research by Diagnostic Research Inc., along with strategic marketing clinic research by the Lexus team, and data mining Toyotas Consolidated Dynamic Study, Team One created its innovative French-language American-aired campaign. The Cabriolet Nouveau campaign married the association of the French with seduction, love, and romance to the stylish, sophisticated, sexy Lexus SC 430. The results were award-winning in numerous ways, including earning the 2002 David Ogilvy Research Award in the durables category. Using the management-research question hierarchy, identify the management dilemma, management question(s), and research question(s) that would drive this research. Watch for the special icon that indicates a continuation of this research story example. www.lexus.com; www.teamoneadv.com; www.diagnostic.com; www.allison-fisher.com

management question the management dilemma restated in question format. research question(s) the hypothesis that best states the objective of the research.

dilemma, will assist in the choice process. In all figures related to the research process model, in this and subsequent chapters, we use an inverted pyramid to represent the management-research question hierarchy. Subsequent stages of the hierarchy take the marketer and his or her research collaborator through various brainstorming and exploratory research exercises to define the following: Management questiona restatement of the marketers dilemma(s) in question form. Research question(s)the hypothesis that best states the objective of the research; the question(s) that focuses the researchers attention.

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Investigative questionsquestions the researcher must answer to satisfactorily answer the research question; what the marketer feels he or she needs to know to arrive at a conclusion about the management dilemma. Measurement questionswhat participants in marketing research are asked or what specifically is observed in a research study. The definition of the management question sets the research task. So a poorly defined management question will misdirect research efforts. In Chapter 5, we explore this critical stage in more detail in our search to clarify the research question.

> Stage 2: Proposing Research

Resource Allocation and Budgets
Once the research question is defined, the manager must propose research in order to allocate resources to the project. While data collection requires substantial resources, it often takes no more than one-third of the total research budget. The geographic scope and the number of observations, surveys, or interviews required do affect the cost of a research project, but much of this cost is relatively independent of the size of the data-gathering effort. Thus, a guide might be that (1) project planning, (2) data gathering, and (3) analysis, interpretation, and reporting each shares about equally in the budget. Without budgetary approval, many research efforts are rejected for lack of resources (see Exhibit 4-3). A budget may require significant development and documentation as in grant and contract research, or it may require less attention as in some in-house projects or investigations funded out of the researchers own resources. The researcher who seeks funding must be able not only to persuasively justify the costs of the project but also to identify the sources and methods of funding. One author identifies three types of budgets in organizations where research is purchased and cost containment is crucial: Rule-of-thumb budgeting involves taking a fixed percentage of some criterion. For example, a percentage of the prior years sales revenues may be the basis for determining the marketing research budget for a manufacturer. Departmental or functional-area budgeting allocates a portion of total expenditures in the unit to research activities. Government agencies, not-for-profits, and the private sector alike will frequently manage research activities out of functional budgets. Units such as human resources, marketing, or engineering then have the authority to approve their own projects. Task budgeting selects specific research projects to support on an ad hoc basis. This type is the least proactive but does permit definitive cost-benefit analysis.2

Valuing Research Information

There is a great deal of interplay between budgeting and value assessment in any management decision to conduct research. The decision maker wants a firm cost estimate for a proposed project and an equally precise assurance that useful information will result from the study. In profit-making concerns, marketing managers are increasingly faced with proving that the research they initiate or purchase meets return-on-investment (ROI) objectives. If such proposed research fails to help managers avoid losses or discover opportunities that can increase sales or profits, such research may be considered wasteful and the proposed research rejected. Even if the researcher can give good cost and information estimates, the manager still must judge whether the benefits outweigh the costs. Conceptually, the value of marketing research is not difficult to determine. One source suggests that the value of research information may be judged in terms of the difference

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> Exhibit 4-3 Proposing Research

Research Question

Propose Research

Revise question Cost exceeds value Management Decision without Research Rejected

Budget and Value Assessment Value exceeds cost

Issue Request for Proposal Obtain Budget and Design Approval

Approved

Execute Research Design

We keep moving forward, opening new doors, and doing new things, because were curious and curiosity keeps leading us down new paths.

between the result of decisions made with the information and the result that would be made without it.3 While such a criterion is simple to state, its actual application presents difficult measurement problems. Not all marketing research is contracted by profitoriented enterprises or with profit-oriented objectives Walt Disney in mind. Churches, trade associations, and foundations are examples of nonprofits that do marketing research on a regular basis. This, however, does not eliminate the need for such organizations managers to prove the value of undertaking marketing research. Ultimately, a marketer will be making a decision that will rely on the insights extracted from the proposed research. The value of the decision with the research however it is measuredmust exceed the value of the decision without research.

Evaluation Methods
Option Analysis Some progress has been made in the development of methods for assessing the value of research when management has a choice between well-defined options. Managers can conduct a formal analysis with each alternative research project judged in terms of estimated costs and associated benefits and with managerial judgment playing a major role. If the research methodology can be stated clearly, one can estimate an approximate cost. The critical task is to quantify the benefits from the research. At best, estimates of benefits are crude and largely reflect an orderly way to estimate outcomes under uncertain conditions. To illustrate how the contribution of research is evaluated in such a decision situation, we must digress briefly into the rudiments of decision theory. Decision Theory When there are alternatives from which to choose, a rational way to approach the decision is to try to assess the outcomes of each action. The case of two

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>snapshot
WASSUP? from Donatos Pizza
In the food business, strategic windows remain open for limited periods of time. Restaurants are influenced by many factors. Some include product, message, weather, reputation, and competition, shared Donatos chief concept officer, Tom Krouse. In Donatos WASSUP? meetings, each employee brings knowledge of an element from popular culture and the group discusses its possible effect on the companys 184 restaurants. Exposure comes from articles, movies, books, TV, and daily living. Donatos filters this less formal exploration with syndicated research. By late July, we had research that showed 26 percent of adult eaters were carb-aware. And Donatos had evidence that adults were incorporating low-carb habits into their diets. In its own restaurants, diners were eating the toppings from their favorite meat-loaded pizza but leaving the crust behind. On this accumulated evidence, Donatos decided it wanted to own the low-carb position in pizza. Donatos first step was to compact its normal new product development process into less than six monthsto be ready for the traditional postholiday increase in dieting. Taste tests told Donatos that the low-carb crust options available sacrificed taste and choosing that route would have jeopardized its premium pizza flavor positioning, which was reinforced by its Edge-toEdge toppings. Instead, Donatos chose a more expensive, but true-to-positioning, product that incorporated protein crisps and tested well with pizza eaters. Following the discovery of a highheat-resistant paper that could serve as both baking and serving plate, the company did in-store trials in two restaurants. In-store postpurchase surveys of diners told Donatos its No Dough pizza was a winner. Donatos rolled out the No Dough pizza to its 184 restaurants in January 2004. The menu board now shows three crust versions: original crispy, traditional, or No Dough. Diners simply choose their favorite pizza toppings and choose the No Dough option. Increased visits from Atkins dieters and purchases from a hidden segment, gluten avoiders, propelled sales increases. Coverage in numerous local papers and TV segments, on the Today show, and in the New York Times helps Donatos own the low-carb position in pizza in its markets. www.donatos.com To learn more, read the case on your DVD: Donatos: Finding the New Pizza.

choices will be discussed here, although the same approach can be used with more than two choices. Youll find an example of decision theory on this books DVD. Two possible actions (A1 and A2) may represent two different ways to promote a company, support a cause, design a product, and so forth. The manager chooses the action that affords the best outcomethe action choice that meets or exceeds whatever criteria are established for judging alternatives. Each criterion is a combination of a decision rule and a decision variable. The decision variable might be new customers captured, contribution to profits, time required for completion of the project, and so forth. For MindWriter, the decision variable might be number of postservice complaints or the level of postservice satisfaction. Usually the decision variable is expressed in a quantifiable measure, often in dollars, representing sales, costs, or some form of profits. The decision rule may be Choose the course of action with the lowest loss possibility or, perhaps, Choose the alternative that provides the greatest number of retained customers. For MindWriter, the decision rule might be Choose the alternative that provides the highest level of postservice satisfaction. The alternative selected (A1 versus A2) depends on the decision variable chosen and the decision rule used. The evaluation of alternatives requires that (1) each alternative is explicitly stated, (2) a decision variable is defined by an outcome that may be measured, and (3) a decision rule is determined by which outcomes may be compared.

decision rule criterion for judging the attractiveness of two or more alternatives when using a decision variable. decision variable a quantifiable characteristic, attribute, or outcome on which a choice decision will be made.

Prior or Interim Evaluation Some research projects are sufficiently unique that managerial experience provides little aid in evaluating the research proposal. Additionally, the management information need may be so great as to ensure that the research is approved. In such cases, managers may decide to control the research expenditure risk by doing a study in stages. They can then review costs and benefits at the end of each stage and give or withhold further authorization. Ex Post Facto Evaluation If there is any measurement of the value of research, it is usually an after-the-fact event. Using an estimate of alternative decision choices, the

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preresearch likelihood that a decision choice would be selected, and a postresearch projection of the implemented decisions contribution to profitability (or some other decision variable), a researcher can estimate the contribution value of a research project. One such study using one manufacturers research activities reported that 40 percent of the research actually directed the manager to the appropriate decision. Using data on profitability contribution and on direct research costs only, the researcher calculated a 312-fold return on the manufacturers investment.4 While the postresearch effort at cost-benefit comes too late to guide a current research decision, such analysis may sharpen the managers ability to make judgments about future research proposals.

The Research Proposal

Exhibit 4-1 depicts the research proposal as an activity that incorporates decisions made during early project planning phases of the study, including the management-research question hierarchy and exploration. The proposal process thus incorporates the choices the investigator makes in the preliminary steps, as depicted in Exhibit 4-3. A written proposal is often required when a study is being suggested. This is especially true if an outside research supplier will be contracted to conduct the research. The written proposal ensures that the parties concur on the projects purpose, the proposed methods of investigation, the extent of analysis, and the timing of each phase as well as of delivery of results. Budgets are spelled out, as are other responsibilities and obligations. The proposal may serve the purpose of a legally binding contract. A research proposal also may be oral, where all aspects of the research are discussed but not codified in writing. This is more likely when a manager directs his or her own research or the research activities of subordinates. We describe detailed research proposals in Chapter 6, and youll find a sample proposal on your text DVD.

> Stage 3: Designing the Research Project

Research Design
research design the blueprint for fulfilling research objectives and answering questions.

The research design is the blueprint for fulfilling objectives and providing the insight to answer managements dilemma. The field of marketing research offers a large variety of methods, techniques, procedures, and protocols. For example, you may decide on reviewing published records (a secondary data study), or studying one particular example in great detail (a case study), or conducting a survey, an experiment, or a computer simulation. If a survey is selected, should it be administered by mail, computer, telephone, the Internet, or personal interview? Should all relevant data be collected at one time or at several different points in time? What kind of structure will the questionnaire or interview guide possess? What question wording should be employed? Should the responses be scaled (Please evaluate each of the following criteria for selecting a store for product X on a scale of 1 to 5, where 5 is critically important and 1 is not important.) or open-ended (What is most important to you when choosing a store for product X?)? How will you ensure that the data you collect will accurately and precisely answer the managers dilemma? Will characteristics of the interviewer influence responses to the measurement questions? What kind of training should the data collectors receive? Is a sample or a census to be taken? What types of sampling should be considered? These questions represent only a few of the decisions that have to be made when just one method is chosen. While selecting an appropriate design may be complicated by this range of options, the creative researcher actually benefits from this confusing array of options. The numerous combinations spawned by the abundance of tools may be used to construct alternative perspectives on the same problem. By creating a research project using diverse methodologies, researchers are able to achieve greater insight than if they adopted the most frequently

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>snapshot
Grilled Cheese Sandwiches and the Dairy Fairy
If you were Kraft and discovered that, while sales of sliced cheese were increasing, your brands sales were decreasing, you might turn to advertising to reverse the slide. But just what would you sayand how? Faced with this situation, Kraft sent ethnographers from Strategic Frameworking to talk with moms aged 25 to 64 who were fixing sandwiches in their kitchens. Focus groups then reinforced that moms feel good about giving their kids cheese because of its nutritional value. Focus groups also revealed that even though their kids preferred Kraft slices, a price difference could persuade moms to purchase a competitive brand. A subsequent phone survey by Market Facts revealed moms would buy the pricier Kraft slices due to extra calcium. Next came TV-commercial tests for two spots featuring the good-taste-plus-thecalcium-they-need message. A spot featuring a straightforward message didnt score as high as one featuring kids scarfing down gooey grilled cheese sandwiches, but the male-voice-delivered two-out-of-five-kids-dont-get-enough-calcium message generated guilt, not positive purchase intentions. A revised commercial featured the cheese-scarfing kids while the Dairy Fairy (an animated cow) delivered the calcium message. Subsequently, Millward Brown Group discovered through copy testing research that the dual message had finally gotten through. The TV commercial aired, delivering an 11.8 percent increase in sales and a 14.5 percent increase in base volume. Sixty-five percent of the growth in sales was attributed to the campaign. www.kraft.com; www.strategicframeworking.com; www.synovate.com; www.millwardbrown.com; www.jwt.com

used method or the method receiving the most attention in the media. Although pursuing research on a single research problem from a multimethod, multistudy strategy is not currently the norm, such designs are getting increasing attention from marketing researchers and winning numerous industry awards for effectiveness. The advantages and disadvantages of several competing designs should be considered before settling on a final one. Jasons preference for MindWriter is to collect as much information as possible from an exploration of company records, interviews with company managers of various departments, and multiple phone surveys with CompleteCare service program users. Financial constraints, however, might force MindWriter to substitute a less expensive methodology: a self-administered survey in the form of a postcard questionnaire sent to each CompleteCare service program user with his or her returned laptop, followed by phone contact only with those who dont return the postcard. We discuss identifying and classifying various research designs in Chapter 8, while in Chapters 9 through 15 we provide information on specific methodologies.

Sampling Design
Another step in planning the research project is to identify the target population (those people, events, or records that have the desired information and can answer the measurement questions) and then determine whether a sample or a census is desired. Taking a census requires that the researcher examine or count all elements in a target population. A sample examines a portion of the target population, and the portion must be carefully selected to represent that population. If sampling is chosen, the researcher must determine which and how many people to interview, which and how many events to observe, or which and how many records to inspect. When researchers undertake sampling studies, they are interested in estimating one or more population values (such as the percent of satisfied service customers who will buy new MindWriter laptops when the need arises) and/or testing one or more statistical hypotheses (for example, that highly satisfied CompleteCare service customers will be far more likely to repurchase the MindWriter brand of laptops). If a studys objective is to predict repeat purchase of laptop brands, then the target population might be defined as all laptop computer owners. In the MindWriter example, given the speed with which technology changes, terms like laptop would need to be defined. Would
census a count of all elements in a population. sample a group of cases, participants, events, or records constituting a portion of the target population, carefully selected to represent that population.

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>picprofile
The Bush and Kerry 2004 presidential campaigns had a potential new research source thanks to Motorola and Rock the Vote. Motorola, a $27.1 billion global company in the wireless, broadband, and automotive communications arenas, partnered with Rock the Vote, a nonprofit, nonpartisan organization designed to engage the youth segment in the political process, to create the Rock the Mobile Vote campaign. A significant element of this campaign was the polling of youths on their political awareness, knowledge, and position on political issues like education, war on terrorism, job creation, and so on. Biweekly, polling questions were sent to mobile handsets of youths 18 to 30 who opted in via the RocktheVote.org Web site to be part of the Get Loud aspect of the campaign. Approximately 50 percent of 18- to 30-year-olds own mobile handsets. The objective of the campaign was to drive 20 million youth voters to the polls. Freebees like ring tone and graphic downloads and contests encouraged participation. www.motorola.com; www.rockthevote.org

handheld and notebook computers be included or excluded? The researcher might also want to restrict the study to owners of the major laptop brands or to owners who reside in certain parts of the world. Because the research is designed to predict a population value from a sample of users, a probability sampling plan would need to be developed. If a probability sampling design is chosen, the process for choosing the sample must then give every person within the target population a known nonzero chance of selection. If there is no feasible alternative, a nonprobability sampling approach may be used. Jason knows that his target population comprises MindWriter customers who have firsthand experience with the CompleteCare laptop servicing program. Given that a list of CompleteCare program users (a sample frame) is readily available each month, drawing a probability sample is feasible. We describe types of samples, sample frames, how samples are drawn, and the determination of sample size in Chapters 16 and 17.

Pilot Testing
Given that thousands of dollars and hundreds of hours can be committed to a research project, the last step in research design is often a pilot test. The researcher may opt to skip pilot testing to condense the project time frame. A pilot test is conducted to detect weaknesses in research methodology and the data collection instrument, as well as to provide proxy data for selection of a probability sample. It should, therefore, draw subjects from the target population and simulate the procedures and protocols that have been designated for data collection. If the study is a survey to be executed by mail, in the pilot test the questionnaire should be mailed. If the design calls for human observation, then a trained observer should collect the data with the appropriate observation checklist. The size of the pilot group may range from 25 to 100 subjects, depending on the research method to be tested, but the participants do not have to be statistically selected. In very small populations or special applications, pilot testing runs the risk of exhausting the supply of respondents and sensitizing them to the purpose of the study. This risk is generally overshadowed by the improvements made to the design by a trial run. Pilot testing has saved countless survey studies from disaster by using the suggestions of the participants to identify and change confusing, awkward, or offensive questions and techniques. Using pilot testing in an interview study for EducTV, an educational television consortium, a disaster was averted. The pilot test revealed that the wording of nearly twothirds of the questions was unintelligible to the target group, later found to have a median eighth-grade education. The revised instrument incorporated the respondents own language and was successful. We discuss one of pilot testings most common variations, the pretesting of survey instruments, in Chapter 15 and Appendix 15b.

pilot test trial collection of data to detect weaknesses in the design or instrument and provide proxy data for probability sampling.

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> Stage 4: Data Collection and Preparation

The gathering of data may range from a simple observation at one location to a grandiose survey of multinational corporations at sites in different parts of the world. The method selected will largely determine how the data are collected. Questionnaires, standardized tests, and observational forms (called checklists) are among the devices used to record raw data. But what are data? In the previous chapter, we described the relationship of facts to conclusions. One writer defines data as the facts presented to the researcher from the studys environment. Data may be further characterized by their abstractness, verifiability, elusiveness, and closeness to the phenomenon.5 First, as abstractions, data are more metaphorical than real. For example, the growth in GDP cannot be observed directly; only the effects of it may be recorded. Second, data are processed by our sensesoften limited in comparison to the senses of other living organisms. When sensory experiences consistently produce the same result, our data are said to be trustworthy because they may be verified. Third, capturing data is elusive, complicated by the speed at which events occur and the time-bound nature of observation. Opinions, preferences, and attitudes vary from one milieu to another and with the passage of time. For example, during presidential elections the incumbent president is often scrutinized and voters favorability ratings are tracked with greater frequency. George W. Bush had the highest ratings ever recorded for a sitting president since Dwight Eisenhower immediately following the terrorist-retaliation bombing of Afghanistan.6 However, as events in Iraq progressed, and as the election campaign year of 20032004 got under way and voters began questioning the advisability of remaining in Iraq, his approval ratings started to fall.7 Finally, data reflect their truthfulness by closeness to the phenomena. Secondary data (data originally collected to address a problem other than the one that requires the managers attention at the moment) have had at least one level of interpretation inserted between the event and its use for marketing decision making. Primary data (data the manager collects to address the specific problem at handthe research question) are sought for their proximity to the truth and control over error. These cautions remind us to use care in designing data collection procedures and generalizing from results. We use a summary definition for data as information collected from participants, by observation, or from secondary sources. Data are edited to ensure consistency across respondents and to locate omissions. In the case of a survey, editing reduces errors in the recording, improves legibility, and clarifies unclear and inappropriate responses. Edited data are then put into a form that makes analysis possible. Because it is impractical to place raw data into a report, alphanumeric codes are used to reduce the responses to a more manageable system for processing and storage. The codes follow various decision rules that the researcher has devised to assist with sorting, tabulating, and analyzing. Personal computers have made it possible to merge editing, coding, and data entry into fewer steps even when the final analysis may be run on a larger system. We address data collection in detail in Part III.

secondary data data originally collected to address a problem other than the one that requires the managers attention at the moment. primary data data the researcher collects to address the specific problem at hand the research question. data information collected from participants, by observation, or from secondary sources.

A focus group is one data collection metholology. This group interview generates primary data.

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>snapshot
Taking the Mystery Out of Mystery Shopping
When a retail salesperson receives a visit from a mystery shopper, its all about processes. Amy Davidoff, president of MarketVoice Consulting, designs a mystery shopping study by starting with a clear understanding of the clients process priorities. Then she partners with the client to develop a shopper form, the detailed checklist of observations that will be recorded, as well as plenty of space for extensive written comments about the experience in general and for all items that received scores below a pre-specified level. While a shopper might target a particular sales associate within a retail environmentbased, for example, on an accumulation of consumer complaintsmore often a retail manager contracts for periodic shoppings over a specified time. For one food and entertainment facility, shares Davidoff, the shop form was 14 pages, covering a 2-hour shopping experience. (A more typical shop form is 5 to 7 pages.) The shop started when the shopper entered the door, included food purchases at two different locations within the facility, restroom checks, specific types of interactions with the facility staff and merchandise purchases. During the shop, the researcher will determine if dozens of processes took place and at what level each was performed against specification. In the overall evaluation, the shop can add weight to more critical processesthose that contribute most to the customer experience and enhance customer loyalty. Taking multiple measures over time reveals weaknesses in training, flaws in operations and sales processes, and the occasional employee theft. And if its done correctly, claims Davidoff, the sales associate may never know they participated in marketing research. Mystery shopping takes place in many different arenas including stores, restaurants, and catalog operations. College students are often employed as mystery shoppers.

> Stage 5: Data Analysis and Interpretation

data analysis editing, reducing, summarizing, looking for patterns, and applying statistical techniques to data.

Managers need information and insights, not raw data, to make appropriate marketing decisions. Researchers generate information and insights by analyzing data after their collection. Data analysis usually involves reducing accumulated data to a manageable size, developing summaries, looking for patterns, and applying statistical techniques. Researchers then interpret their findings in light of the managers research question or determine if the results are consistent with their hypotheses and theories. Increasingly, managers are asking research specialists to make recommendations based on their interpretation of the data. We address data analysis and interpretation in Chapters 18 to 22. A modest example involves a market research firm that polls 2,000 people from its target population for a new generation of wallet-sized portable telephones. Each respondent will be asked four questions: 1. Do you prefer the convenience of Pocket-Phone over existing cellular telephones? 2. Are there transmission problems with Pocket-Phone? 3. Is Pocket-Phone better suited to worldwide transmission than your existing cellular phone? 4. Would cost alone persuade you to purchase Pocket-Phone? The answers will produce 8,000 (2,000 4) pieces of raw data. Reducing the data to a workable size will yield eight statistics: the percentages of yes and no answers to each question. When the researcher adds a half-dozen demographic questions about the participants, the total amount of data easily triples. If the researcher scaled the four key questions (asking the participants to provide a number from 1 to 5 for each question) rather than eliciting yes-no responses, the analysis would likely require more powerful statistical analysis than summarization.

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> Stage 6: Reporting the Results

Finally, it is necessary to prepare a report and transmit the findings, insights, and recommendations to the manager for the intended purpose of decision making. The researcher adjusts the style and organization of the report according to the target audience, the occasion, and the purpose of the research. As a result, most marketing researchers emphasize the need to make the research report manager-friendly, avoiding technical jargon. The results of applied research may be communicated via conference call, letter, written report, oral presentation, Webcast, or some combination of any or all of these methods. Reports should be developed from the managers or information users perspective. The sophistication of the research design and sampling plan or the software used to analyze the data may help to establish the researchers credibility, but in the end the managers foremost concern is solving the management dilemma. Thus, the researcher must accurately assess the managers needs throughout the research process and incorporate this understanding into the final product, the research report. The management decision maker occasionally shelves the research report without taking action. Inferior communication of results is a primary reason for this outcome. With this possibility in mind, a research supplier should strive for: Insightful adaptation of the information to the clients needs. Careful choice of words in crafting interpretations, conclusions, and recommendations. Especially when research is contracted to an outside supplier, managers and researchers increasingly collaborate to develop appropriate reporting of project results and information. Occasionally, organizational and environmental forces beyond the researchers control argue against the implementation of results. Such was the case in a study conducted for the Association of American Publishers, which needed an ad campaign to encourage people to read more books. The research project, costing $125,000, found that only 13 percent of Americans buy general-interest books in stores. When the time came to commit $14 million to the campaign to raise book sales, the memberships interest had faded and the project died.8 We cover the research report in Chapter 23. At a minimum, a research report should contain the following: An executive summary consisting of a synopsis of the problem, findings, and recommendations. An overview of the research: the problems background, a summary of exploratory findings drawn from secondary data sources, the actual research design and procedures, and conclusions. A section on implementation strategies for the recommendations. A technical appendix with all the materials necessary to replicate the project.

> Research Process Problems

Although it is desirable for research to be thoroughly grounded in management decision priorities, studies can wander off target or be less effective than they should be. As research progresses through its various stages, the researcher needs to remain objective.

The Favored-Technique Syndrome

Some researchers are method-bound. They recast the management question so it is amenable to their favorite methodologya survey, for example. Others might prefer to emphasize the case study, while still others wouldnt consider either approach. Not all researchers are comfortable with experimental designs. Due to their wide range of experience and educational

>

It is the role of the manager sponsoring the research to spot an inappropriatetechnique-driven research proposal.

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training, researchers are rarely well versed in every possible methodology. Out of a need for control or comfort, some will rely only on methods with which they have experience. Persons knowledgeable about and skilled in some techniques but not in others may be blinded by their special competencies. Their concern for technique dominates the decisions concerning what will be studied (both investigative and measurement questions) and how (research design). The availability of technique is an important factor in determining how research will be done or whether a given study can be done. The marketing decision maker sponsoring the research should be wary of inappropriate-technique-driven research proposals. We discuss research techniques and when each is appropriate in Chapters 9 through 17. In the MindWriter research, for example, numerous, standardized customer satisfaction questionnaires are available to researchers. Jason may have done studies using these instruments for any number of his clients. Myra should be cautious. She must not let Jason encourage her acceptance of an instrument he has developed for another client, even though he might be very persuasive about its success in the past. Such a technique might not be appropriate for MindWriters search to resolve postpurchase service dissatisfaction.

Company Database Strip-Mining

>
We discussed decision support systems in Chapter 2.

The existence of a pool of information or a database can distract a manager, seemingly reducing the need for other research. As evidence of the research-as-expense-not-investment mentality mentioned in Chapter 1, managers frequently hear from superiors, We should use the information we already have before collecting more. Modern marketing information systems are capable of providing massive volumes of data. This is not the same as saying modern marketing information systems provide substantial knowledge or decision-making insights. Each field in a database was originally created for a specific reason, a reason that may or may not be compatible with the management question facing the organization. The MindWriter service departments database, for example, probably contains several fields about the type of problem, the location of the problem, the remedy used to correct the problem, and so forth. Jason and Myra can accumulate facts concerning the service, and they can match each service problem with a particular MindWriter model and production sequence (from a production database), and, using yet another database (generated from warranty registration), they can match each problem to a name and address of an owner. But, having done all that, they still arent likely to know how a particular owner uses his or her laptop or how satisfied an owner was with MindWriters postpurchase service policies and practices. Mining marketing information databases is fashionable, and all types of organizations increasingly value the ability to extract meaningful information. While such data mining is often a starting point in decision-based research, rarely will this activity answer all management questions related to a particular management dilemma. In this text, we emphasize research projects that tend to be nonroutine, nonrecurring, and complex, rather than those that rely solely on database management.

Unresearchable Questions
Not all management questions are researchable, and not all research questions are answerable. To be researchable, a question must be one for which observation or other data collection can provide the answer. Many questions cannot be answered on the basis of information alone. Unresearchable questions include those for which past experience of the researcher or experience of the greater research industry has revealed that the information does not exist or cannot be gathered. An example is a study in which purchase information dating back 30 or more years is needed and no such records exist. It is unrealistic to assume purchasers can recall purchase behavior that long ago with sufficient accuracy or in sufficient detail to be useful.

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Just as human memory can be faulty, when we seek motivations from participants, we may run into unresearchable questions. Sometimes customers and other participants simply dont know why they do what they do. Questions of value and policy often must be weighed in management decisions. The multiple facets of the deliberations make many such questions unresearchable. During the early and mid-1980s several product-tampering incidents of over-the-counter drug products resulted in deaths. Asking Should products be withdrawn if even one death is associated with its prescribed use, even if no fault for the tampered product accrues to the manufacturer? might qualify as an unresearchable question. While information can be brought to bear on this question, such additional considerations as safety to society or fairness to stockholders or an appropriate response to terrorist activity may be important value debates that add to the decision. While we might be able to estimate a companys reputation or standing among its stakeholders in a similar hypothetical situation, only after the fact could we determine what people really felt about a company that was not responsive. When the managers responsible for Tylenol faced such a question, even though they had feedback within 24 hours of the first reported death, it was impossible to predict peoples reaction to a second death until it was reported. Johnson & Johnsons decision to replace Tylenol capsules with solid Tylenol caplets ultimately was based on senior-level debate of such issues, not on direction provided by research that indicated that the public did not hold the manufacturer responsible for the dealths.9 Even if a question can be answered by facts alone, it might not be researchable because currently accepted and tested procedures or techniques are inadequate. The development of new techniques and methodologies is often the result of researchers frustration with unresearchable problems. Such problems become the motivation for innovation in methodology.

Ill-Defined Management Problems

Some categories of problems are so complex, value-laden, and bound by constraints that they prove to be intractable to traditional forms of analysis. These questions have characteristics that are virtually the opposite of those of well-defined problems. Solving welldefined problems involves navigating from a starting point to the solution using natural transitions in the problem sequence to shift from one problem state to another. An illdefined problem is one that addresses complex issues and cannot be expressed easily, concisely, or completely. Ill-defined problems pose a dilemma for researchers because a solution sequence cannot be plotted if little is understood about the path or the final outcome. Certain complex puzzles (see reference note 10) illustrate ill-defined problems when the components of their problem sequences are not fully specified, the problem description lacks concreteness, and the goal cannot be visualized.10 Ill-defined research questions in marketing are least susceptible to attack from quantitative research methods because such problems have too many interrelated facets for measurement to handle with accuracy.11 Moreover, there are some research questions of this type for which methods do not presently exist; even if the methods were to be invented, they still might not provide the data necessary to solve them.12 Novice researchers should avoid ill-defined problems. Even seasoned researchers will want to conduct a thorough exploratory study before proceeding with the latest approaches.

ill-defined problem one that addresses complex issues and cannot be expressed easily or completely.

Politically Motivated Research

It is important to remember that a managers motivations for seeking research are not always obvious. Managers might express a genuine need for specific information on which to base a decision. This is the ideal scenario for quality research. Sometimes, however, a research study may not really be desirable but is authorized anyway, chiefly because its presence may win approval for a certain managers pet idea. At other times, research may be authorized as a measure of personal protection for a decision maker in case he or she is criticized later. In these less-than-ideal cases, the researcher may find it more difficult to win the managers support for an appropriate research design.

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>summary
1 Research originates in the decision process. A manager needs specific information for setting objectives, defining tasks, finding the best strategy by which to carry out the tasks, or judging how well the strategy is being implemented. A dilemma-centered emphasisthe problems origin, selection, statement, exploration, and refinementdominates the sequence of the research process. A decision to do research can be inappropriately driven by the availability of coveted tools and databases. To be researchable, a problem must be subject to observation or other forms of empirical data collection. 2 How one structures the research question sets the direction for the project. A management problem or opportunity can be formulated as a hierarchical sequence of questions. At the most general level is the management dilemma. This is translated into a management question and then into a research questionthe major objective of the study. In turn, the research question is further expanded into investigative questions. These questions represent the various facets of the problem to be solved, and they influence research design, including design strategy, data collection planning, and sampling. At the most specific level are measurement questions that are answered by respondents in a survey or answered about each subject in an observational study. Exploration of the problem is accomplished through familiarization with the available literature, interviews with experts, focus groups, or some combination. Revision of the management or research questions is a desirable outcome of exploration and enhances the researchers understanding of the options available for developing a successful design. 3 Budgets and value assessments determine whether most projects receive necessary funding. Their thorough documentation is an integral part of the research proposal. Proposals are required for many research projects and should, at a minimum, describe the research question and the specific task the research will undertake. 4 Decisions concerning the type of study, the means of data collection, measurement, and sampling plans must be made when planning the design. Most researchers undertake sampling studies because of an interest in estimating population values or testing a statistical hypothesis. Carefully constructed delimitations are essential for specifying an appropriate probability sample. Nonprobability samples are also used. Pilot tests are conducted to detect weaknesses in the studys design, data collection instruments, and procedures. Once the researcher is satisfied that the plan is sound, data collection begins. Data are collected, edited, coded, and prepared for analysis. Data analysis involves reduction, summarization, pattern examination, and the statistical evaluation of hypotheses. A written report describing the studys findings is used to transmit the results and recommendations to the intended decision maker. By cycling the conclusions back into the original problem, a new research iteration may begin, and findings may be applied. 5 Several research process problems can diminish the value of research. Included in these are using a technique that is inappropriate for the information needed, just because it is familiar or the researcher has experience with it; attempting to substitute data mining for marketing research; focusing on an unresearchable question; failing to correctly define the management problem; and conducting politically motivated rather than management dilemmamotivated research.

>keyterms
census 87 data 89 primary data 89 secondary data 89 data analysis 90 decision rule 85 decision variable 85 ill-defined problem 93 investigative questions 83 management dilemma 80 management question 82 management-research question hierarchy 80 measurement questions 83 pilot test 88 research design 86 research process 78 research question(s) 82 sample 87

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>discussionquestions
Terms in Review 1 Some questions are answerable by research and others are not. Using some management problems of your choosing, distinguish between them. 2 Discuss the problems of trading off exploration and pilot testing under tight budgetary constraints. What are the immediate and long-term effects? 3 A retailer is experiencing a poor inventory management situation and receives alternative research proposals. Proposal 1 is to use an audit of last years transactions as a basis for recommendations. Proposal 2 is to study and recommend changes to the procedures and systems used by the shipping/receiving department. Discuss issues of evaluation in terms of: a Ex post facto versus prior evaluation. b Evaluation using option analysis and decision theory. Making Research Decisions 4 Believing that every employee contributes to marketing in an organization, the president of Oaks International Inc., when confronted by low productivity and rising customer complaints, is convinced by a research supplier to study job satisfaction in the corporation. What are some of the important reasons that this research project may fail to make an adequate contribution to the solution of management problems? 5 Based on an analysis of the last six months sales, your boss notices that sales of beef products are declining in your chains restaurants. As beef entre sales decline, so do profits. Fearing beef sales have declined due to several newspaper stories reporting E. coli contamination discovered at area grocery stores, he suggests a survey of area restaurants to see if the situation is pervasive. a What do you think of this research suggestion? b How, if at all, could you improve on your bosss formulation of the research question? Behind the Scenes 6 What are the benefits to MindWriter if they implement the pilot study Jason recommends? 7 How can MindWriters existing database be used to accumulate service problem information in advance of the proposed research? What information should be sought? From Concept to Practice 8 Using Exhibit 4-1 and case examples from marketing firms Web sites, discover how favored technique approaches to research design dominate many firms strategies. 9 Refer to stage in Exhibit 4-1, then find a research example where a clear statement of the management dilemma leads to a precise and actionable research question.

>wwwexercise
Learn more about business intelligence from industry leader MicroStrategy. Visit its Web site and participate in a free Web seminar on a current case study. (http://www.microstrategy.com/events/online_seminars/index.asp)

>cases*
Calling Up Attendance Donatos: Finding the New Pizza Goodyears Aquatred Inquiring Minds Want to KnowNow! KNSD, San Diego Mastering Teacher Leadership NCRCC: Teeing Up a New Strategic Direction Outboard Marine Corporation Ramada Demonstrates Its Personal Best State Farm: Dangerous Intersections

* All cases, both written and video, are on the text DVD. The film icon indicates a video case. Check the DVD Index to determine whether a case has data, the research instrument, or other supplementary material.