Chapter 1: Research Fundamentals Chapter 2: Research Process

Chapter 2 - Research Process
Chapter 1 : Research Fundamentals
Chapter 2: Research Process
Prepared by Group 1
RICERCA
Chapter nos. Topics Page nos.

1 Research fundamentals
• Definition of research 01
• Basics vs applied research 03
• Market and marketing research 03
03
• Information systems, decision support
systems, and marketing research
• Advantages of MR 05
06
• Limitations of the MR
07
• Application of marketing research
2 Research process
18
• Steps in the process of research
• Problem discovery 19
• Problem definition 19
19
• Research objectives
• Developing hypothesis for a particular 20
problem
• Research design 21
21
• Research method 22
• Data collection – sources and tools
23
• Sampling methods 23
• Use of scales in research
24
• Data processing 24
• Data analysis 25
• Research report
1. RESEARCH FUNDAMENTALS
 MEANING OF RESEARCH
Research in common parlance refers to a search for knowledge. One can also define
research as a scientific and systematic search for pertinent information on a specific
topic. In fact, research is an art of scientific investigation. The Advanced Learner’s
Dictionary of Current English lays down the meaning of research as a careful
investigation or inquiry specially through search for new facts in any branch of
knowledge. Redman and Mory define research as a “systematized effort to gain new
knowledge.” Some people consider research as a movement from the known to the
unknown. It is actually a voyage of discovery. We all possess the vital instinct of
inquisitiveness for, when the unknown confronts us, we wonder and our
inquisitiveness makes us probe and attain full and fuller understanding of the
unknown. This inquisitiveness is the mother of all knowledge and the method, which
man employs for obtaining the knowledge of whatever the unknown, can be termed
as research.
Research is an academic activity and such a term should be used in a technical

sense. According to Clifford Woody research comprises defining and redefining
problems, formulating hypothesis or suggested solutions; collecting, organizing and
evaluating data; making deductions and reaching conclusions to determine whether
they fit the formulating hypothesis. D.Slesinger and M.Stephenson in the
Encyclopedia of Social Sciences define research as “the manipulation of things,
concepts or symbols for the purpose of generalizing to extend, corrector verify
knowledge, whether that knowledge aids in construction of theory or in the practise
of art.” Research is thus an original contribution to the existing stock of knowledge
making for its advancement. It is the pursuit of truth with the help of study,
observation, comparison and experiment. In short, the search for knowledge through
objective and systematic method of finding solution to a problem is research. The
systematic approach concerning generalization and the formulation of a theory is
also research. As such the term ‘research’ refers to the systematic method consisting
of enunciating the problem, formulating a hypothesis, collecting facts or data,
analyzing the facts and reaching certain conclusion either in the form of solutions
towards the concerned problem or in certain generalization for some theoretical
formulation.
 OBJECTIVE OF RESEARCH
The purpose of research is to discover answers through the application of

scientific procedures. The main aim of research is to find out the truth which is
hidden and which has not been discovered as yet. Though each research study has
its own specific purpose, we may think of research objectives as falling into number
of broad grouping:
• To gain familiarity with a phenomenon or to achieve new insights into it (studies
with this object in view are termed as exploratory or formulative research studies.
• To portray accurately the characteristics of a particular individual, situation

or a group (studies with this object in view are known as descriptive research
studies);
• To determine the frequency with which something occurs or with which it is
associated with something else (studies with this object in view are known as
diagnostic research studies).
• To test a hypothesis of a casual relationship between variables (such studies are known as
hypothesis-testing research studies).
 BASIC VS APPLIED RESEARCH
Research can either be applied (or action) research or fundamental (or basic or
pure) research. Applied research aims at finding a solution for an immediate
problem facing a society or an industrial/business organization, whereas
fundamental research is mainly concerned with generalizations and with the
formulation of a theory. “Gathering knowledge for knowledge’s sake is termed as
pure or ‘basic’ research”. Research concerning some natural phenomenon or relating
to pure mathematics are examples of fundamental. Similarly, research studies,
concerning human behavior carried on with a view to make generalizations about
human behavior, are also examples of fundamental research, but research aimed at
certain conclusions (say, a solution) facing a concrete social or business problem is
an example of applied research. Research to identify social, economic or political
trends that may affect a particular solution or the copy research (research to find out
whether certain communications will be read and understood) or the marketing
research or evaluation research are examples of applied research. Thus, the central
aim of applied research is to discover a solution for some pressing practical problem,
whereas basic research is directed towards finding information that has a broad base
of application and thus, adds to the already existing organized body of scientific
knowledge.
 INFORMATION SYSTEMS, DECISION SUPPORT SYSTEMS, AND

MARKETING RESEARCH
An information system (IS) is a continuing and interacting structure of

people, equipment, and procedures designed to gather, sort, analyze,
evaluate, and distribute pertinent, timely, and accurate information to
decision makers. While marketing research is concerned mainly with the
actual content of the information and how it is to be generated, the
information system is concerned with managing the flow of data from
many different projects and secondary sources to the managers who will
use it. This requires database to organize and store the information and
a decision support system (DSS) to retrieve data, transform it into usable
information, and disseminate to users.
Database
Information systems contain three types of information.

1. The first is recurring day-today information.
2. A second type of information is intelligence relevant to the future strategy of the
business.
3. A third input to the information system is research studies that are not of a
recurring nature. The potential usefulness of a marketing research study can be
multiplied manifold if the information is accessible instead of filed and forgotten.
However, the potential exists that others may use the study, although perhaps not
in the way it was originally intended.
Decision support system
Database have no value if the insights they contain cannot be retrieved. A decision
support system not only allows the manager to interact directly with the database to
retrieve what is wanted, it also provides a modeling function to help make sense of
what has been retrieved.
Application information system to marketing research
The information system serves to emphasize that marketing research should not
exist in isolation as a single effort to obtain information. Rather, it should be part of a
systematic and continuous effort by the organization to improve the decision-making
process.
MARKETING DECISION SUPPORT SYSTEMS
A typical marketing manager regularly receives some or all of the following data:
factory shipments or orders; consumer panel data; scanner data; demographic data;
and internal cost and budget data.
Managers don’t want data. They want, and need, decision-relevant information in
accessible and preferably graphical form for
(1) Routine comparison of current performance against past trends on each of the
key measures of effectiveness
(2) Periodic exception reports to assess which sales territories or accounts have not
matched previous tears’ purchases and
(3) Special analyses to evaluate the sales impact of particular marketing programs
and to predict what would happen if changes were made. In addition, different
divisions would like to be linked to enable product managers, sales planners,
market researchers, financial analysts and production schedules to share
information.
The purpose of a marketing decision support system (MDSS) is to combine
marketing data from diverse sources into a single database which line managers can
enter interactively to quickly identify problems and obtain standards, periodic reports,
as well as answers to analytical questions.
Characteristics of a MDSS
A good MDSS should have the following characteristics

1. Interactive. The process of interaction with the MDSS should be simple and
direct. With just a few commands the user should be able to obtain the results
immediately. There should be no need for a programmer in between.
2. Flexible. A good MDSS should be flexible. It should be able to present the
available data in either discrete or aggregate form. It should satisfy the
information needs of the managers in different hierarchical levels and functions.
3. Discovery oriented. The MDSS should not only assist managers in solving the
existing problems but should also help them to probe for trends and ask new
questions. The managers should be able to discover new patterns and be able to
act on them using the MDSS.
4. User friendly. The MDSS should be user friendly. It should be easy for the
managers to learn and use the system. It should not take hours just to figure out
what is going on. Most MDSS packages are menu driven and are easy to
operate.
A typical MDSS is assembled from four components
Manager
Modeling Display
Analysis Database
Manager
1. Database
2. Reports and displays
3. Analysis capabilities
4. Models
 ADVANTAGES OF MR
For decision makers, faced with the decisions and doubts described above, what
should be the benefits of having research conducted? The most universal and
usually most vital is this: reduction of uncertainty. If research findings contribute any
relevant knowledge of what exists, that the decision maker was ignorant of, or if it
provides new clues to what is likely in the future, they should enable a more accurate
conclusive decision to be reached.
Uncertainty can not be wholly eliminated with relevant research, but it may be
markedly reduced.
Research also may be of benefit in ways ordinarily thought of as uncertainty
reduction:
(1) Problems may come to light that otherwise would be not be known until they
became very serious or even insoluble
(2) Objectives may come under reevaluation when evidence indicates that
(a) they may be too high to be feasible under expected conditions or
(b) they should be higher due to overlooked opportunity
(3) Better alternatives may be revealed or their conception stimulated
(4) Marketing research may be useful as evidence in legal matters.
We would call attention to other benefits, such as the psychological one of making
the decision-maker feel more confident and willing to be decisive. Prejudice against
new ideas may be overcome by evidence from the market place. Sociologically,
research can keep the executives attuned to changing consumer needs and wants
and to the impacts of consumerism. Less laudable are political motives for marketing
research, like the executives who wants it to confirm some preconceived ideas and
overcome rivals in the organization (but would suppress if they fail to confirm).
 LIMITATIONS TO MR
Some of the limitations faced by the researchers in MR are:

1. The lack of scientific training in the methodology of research is a great
impediment for researchers in our country. There is paucity of competent
researchers. Many researchers take a leap in the dark without knowing research
methods. Most of the work, which goes in the name of research, is not
methodologically sound. Research to many researchers and even to their guides,
is mostly a scissors and paste job without any sight shed on the collated
materials. The consequence is obvious, viz, the research results, quite often, do
not reflect the reality or realities. Before undertaking research projects,
researchers should be well equipped with all the methodological aspects. As
such, efforts should be made to provide short-duration intensive courses for
meeting this requirement.
2. There is insufficient interaction between the university research departments on
one side and business establishments, government departments and research
institutions on the other side. A great deal of primary data of non-confidential
nature remain untouched/untreated by the researchers for want of proper
contacts. Efforts should be made to develop satisfactory liaison among all
concerned for better and realistic researchers. There is need for developing some
mechanisms of a university – industry interaction programme so that academics
can get ideas from practitioners on what needs to be researched and
practitioners can apply the research done by the academics.
3. Most of the business units in our country do not have the confidence that the
material supplied by them researchers will not be misused and as such they are
often reluctant in supplying the needed information to researchers. The concept
of secrecy seems to be sacrosanct to business organizations in the country so
much so that it proves an impermeable barrier to researchers. Thus, there is the
need for generating the confidence that the information/data obtained from a
business unit will not be misused.
4. Research studies overlapping one another are undertaken quite often for want of
adequate information. This results in duplication and fritters away resources. This
problem can be solved by proper compilation and revision, at regular intervals, of
a list of subjects on which and the places where the research problems in various
disciplines of applied science which are of immediate concern to the industries.
5. There does not exist a code of conduct for researchers and inter-university and
inter-departmental rivalries are also quite common. Hence, there is need for
developing a code of conduct for researchers which, if adhered sincerely, can win
over this problem.
6. Many researchers in our country also face the difficulty of adequate and timely
secretarial assistance, including computerial assistance. This causes
unnecessary delays in the completion of research studies. All possible efforts be
made in this direction so that efficient secretarial assistance is made available to
researchers and that too well in time. University Grants Commission must play a
dynamic role in solving this difficulty.
7. Library management and functioning is not satisfactory at many places and much
of the time and energy of researchers are spent in tracing out the books, journals,
reports, etc., rather than in tracing out relevant material from them.
8. There is also the problem that many of our libraries are not able to get copies of
old and new Acts/Rules, reports and other government publications in time. This
problem is felt more in libraries, which are away in places from Delhi and/or the
state capitals. Thus, efforts should be made for regular and speedy supply of all
governmental publications to reach our libraries.
 APPLICATION OF MARKETING RESEARCH
TRADITIONAL APPLICATION OF MARKETING RESEARCH
Traditionally, marketing decisions have been divided into 4P’s – product,

price, promotion and place decisions.
I. New-product research
New product development is critical to the life of most organizations as they adapt to
their changing environment. Since, by definition, new products contain unfamiliar
aspects for the organization, there will be uncertainty associated with new products.
New product can be divided into four stages
Concept Generation
Need Identification
Concept Identification
Concept Evaluation and

Development
Product Evaluation and

Development
Testing the Marketing

Program
1. Concept generation
There are two types of concept generation research. They are:

a. Need identification. The emphasis in need research is on identifying unfilled
needs in the market. Marketing research can identify needs in various ways.
Some are qualitative and others, such as segmentation studies can be
quantitative. Following are some examples:
i. Perceptual maps, in which products are positioned along the dimensions by
which users perceive and evaluate, can suggest gaps into which new
products might fit. Multidimensional scaling is used to generate these
perception gaps.
ii. Social and environment trends can be analyzed.
iii. An approach termed benefit structure analysis has product users identify the
benefits desired and the extent to which the product delivers those benefits,
for specification applications. The result is an identification of benefits sought
that current product do not deliver.
iv. Lead user analysis is the approach in which instead of just asking users what
they have done, their solutions are collected more formally. Lead users are
positioned to benefit significantly by solving problems associated with these
needs. Once a lead user is identified, the concepts that company or person
generates are tested.
b. Concept identification. During the new product development process there is
usually a point where a concept is formed but there is no tangible usable product
that can be tested. The concept should be defined well enough so that it is
communicable. There may be simply a verbal description, or there may be rough
idea for a name, a package, or an advertisement approach. The role of marketing
research at this stage is to determine if the concept warrants further development
and to provide guidance on how it might be improved and refined.
2. Product Evaluation and development
Product evaluation and development, or product testing, is very similar

to concept testing, in terms of both the objectives and the techniques.
The aim is still to predict market response to determine whether or not
the product should be carried forward.
a. Use testing. The simplest form of use testing gives users the product and after a
reasonable amount of time asks their reactions their intentions to buy it.
b. Predicting trial. Trial levels (the percentage of a sample of consumers who had
purchased the product at least once within 12 months after launch) were
predicted on the basis of three variables:
• Product class penetration (PCP)
• Promotional expenditure
• Distribution of the product
c. Pretest marketing. Two approaches are used to predict the new brand’s market
share.
• The first one is based on preference judgments. The preference data are used to
predict the proportion of purchases of the new brand that respondents will make
given that the new brand is in their response set.
• The second approach involves estimating trial and repeat purchase levels based
on the respondent’s purchase decisions and intentions-to-buy judgments.
3. Test marketing
Test marketing allows the researcher to test the impact of the total
marketing program, with all its interdependencies, in a market context as
opposed to the artificial, context associated with the concept and product
tests that have been discussed.
Test marketing has two primary functions.
• The first is to gain information and experience with the marketing program before
making a total commitment to it.
• The second is to predict the program’s outcome when it is applied to the total
market.
There are really two types of test markets:
1. Sell-in test markets are cities in which the product is sold just as it would be in a
national launch. In particular, the product has to gain distribution space.
2. Controlled-distribution scanner markets are cities for which distribution is
prearranged and the purchase of a panel of customers are monitored using
scanner data.
Really new product
Really new product normally take a long time (sometimes 15 to 20 years) from
conception to national introduction. Really new products (RNPs) are those that:
• Create or expand a new category, thereby making cross-category competition the
key (e.g., fruit teas versus soft drinks)
• Are new to customers, for whom substantial learning is often required (i.e., what it
can be used for, what it competes with, why it is useful).
• Raise broad issues such as appropriate channels of distribution and
organizational responsibility.
• Create (sometimes) a need for infrastructure, software and add-ons.
II. PRICING RESEARCH
Research may be used to evaluate alternatives price approaches for new products
before launch or for proposed changes in products already on the market.
There are two general approaches to pricing research.
1. The first is the well-established Gabor and Grainger method. In this method,
different prices for a product are presented to respondents (often by using test-
priced, with the corresponding number of affirmative purchase intentions is
produced.
2. In a second approach, respondents are shown different sets of brands in the
same product category, at different prices and are asked which they would buy.
This multibrand-choice method allows respondents to take into account
competitions’ brands as they normally would outside such a test. S such, this
technique represents a form of simulation of the point of sale.
Decisions regarding price ranges for new product have to be made early in the
development stage. A product concept cannot be tested fully, for example, without
indicating its price, so when the product is ready to be introduced, a decision must
be made about its specific price. Decisions on price changes-should we change the
price, and, if so, in which way and by how much? – will then need to be made over
the product’s life cycle.
Either of two pricing strategies can be followed.
1. Skimming strategy.
The skimming strategy is based on the concept of pricing the product at the point at
which profits will be the greatest until market conditions change or supply costs
dictate a price change. Under this strategy, the optimal price is the one that results in
the greatest positive difference between total revenues and total costs.
2. Share-penetration strategy
Penetration strategy is a strategy based on the concept that average unit production
costs continue to go down as cumulative output increases. Potential profits in the
early stages of the product life cycle are sacrificed in the expectation that higher
volumes in later periods will generate sufficiently greater profits to result in overall
profit for the product over its life.
III. Distribution research
Traditionally, the distribution decisions in marketing strategy involve the number and
location of salepersons, retail outlets, warehouses and the size of discount to be
offered. The discount to be offered to the members in the channel of distribution

usually is determined by what is being offered by existing or similar products, and
also whether the firm wants to follow a “push” or a “pull” strategy. Marketing
research, however, plays an important role in the number and location in decisions
about numbers and locations.
a. Warehouse and Retail Location Research
The essential questions to be answered before a location decision is

made are: “What costs and delivery times would result if we choose one
location over another?”
Simulation of scenarios is used to answer these questions. The simulation can be
relatively simple, paper-and-pencil exercise for the location of a single warehouse in
a limited geographic area, or it can be a complex, computerized simulation of a
warehousing system for a regional or national market.
i. Center of gravity simulation. The center for gravity method of simulation is
used to locate a single warehouse or retail site. In this method, the
approximate location that will minimize the distance to customers, weighted
by the quantities purchased, is determined. The more symmetry there is in
customer locations and weights, the more nearly the initial calculation
approximates the optimal location. The location indicated by the first
calculation can be checked to be determine if it is optimal (or near optimal) by
using a “confirming” procedure. If it in not optimal, successive calculations can
be made as necessary to “home in” on the best location.
ii. Computerized simulation models. The concept involved in simulations for this
purpose is quite simple. Data that describes the customer characteristics
(location of plants, potential warehouse and retail sites) and distribution costs
(costs per mile by volume shipped, fixed and variable costs of operating each
warehouse, the effect of shipping delays on and variable costs of operating
each warehouse, the effect of shipping delays on customer demand) are
generated and input into the computer. The computer is programmed to
simulate various combinations of numbers and locations of warehouses, and
to indicate which one(s) gives the lowest total operating cost. Effective results
have been achieved by using computer simulations to design distribution
systems.
iii. Trade area analysis. Formal models have been developed that can be used to
predict the trading area of a given shopping center or retail outlet based on
relative size, travel time, and image. A variety of other techniques can be used
to establish trading areas. An analysis of the addresses of the credit card
customers or license plates of the cars (by plotting the addresses of the car
owners) can provide a useful estimate of the trading area. Check-clearance
data can be used to supplement this information. The best, but also the most
expensive way of establishing trading area bound Aries is to conduct surveys
to determine them.
iv. Outlet location research. Individual companies and, more commonly, chains,
financial institutions with multiple outlets, and franchise operations must
decide on the physical location of their outlet(s). Three general methods
involves plotting the area surrounding the potential site in terms of residential
neighborhood, income levels, and competitive stores. Regression models

have been used for location studies for a variety of retail outlets, including
banks, grocery stores, liquor stores, chain stores and hotels. Data for building
the model and for evaluating new potential locations are obtained through
secondary data analysis and surveys.
b. Number and location of Sales Representatives
How many sales representatives should be in a given territory? There

are three general research methods for answering this question.
• The first, the sales effort approach, is applicable when the product line is first
introduced and there is no operating history to provide sales data.
• The second involves the statistical analysis of sales data and can be used after
the sales program is under way.
• The third involves a field experiment and is also applicable only after the sales
program has begun.
IV. Promotion research
It focuses on the decision that are commonly made when designing a promotion
strategy. The decision for the promotion part of a marketing strategy can be divided
in to (1) Advertising and (2) Sales promotion. Sales promotion affects the company in
the short term, whereas advertising decisions have long-term effects. Companies
spend more time and resources on advertising research than on sales promotion
research because of the greater risk and uncertainty in advertising research.
1. Advertising research
Most companies concentrate on advertising because advertising decisions are more

costly and risky than sales promotion decisions. Advertiseing reasearch typically,
involves generating information for making decisions in the awareness, recognition,
preference and purchasing stages.
What separates an effective advertisement from a dud? The criteria will depend, on
th brand involved and its advertising objective. However, four basic categories of
responses are used in advertising research in general and copy testing in particular:
a) Advertisement recognition
b) Recall of the commercial and its contents
c) The measure of commercial persuasion and the impact on purchase behavior.
• Purchase behavior
- Coupon stimulating purchasing
- Split-cables tests. Information Resources Inc’s (IRI) BehaviorScan is one of
several spilt-cable testing operations. BehaviorScan monitors the purchases of
panel members as well as in-store information such s special prices, features and
displays.
• Tracking studies
When a campaign is running, its impact often is monitored via a tracking study
Periodic sampling of the target audience provide a time trend of measures of
interest. The purpose is to evaluate and reassess the advertising campaign, and
perhaps also to understand why it is or is not working. Among the measures that
often are traced are advertisement awareness, awareness of elements of the
advertisement, brand awareness, beliefs about brand attributes, brand image,
occasions of use, and brand preference. Of particular interest is knowing how the
campaign is affecting the brand, as opposed to how the advertisement is
communicating the message.
• Diagnostics testing
A whole category of advertising research methods is designed primarily not to test
the impact of a total ad but rather to help creative people understand how the parts
of the ad contribute to its impact. Which are weak and how do they interact? Most of
these approaches can be applied to mock-ups of proposed ads as well as finished
ads.
• Copy test validity
This test refers to the ability to predict advertising response.
• Budget decision
Arriving at analytical, research-based judgments as to the optimal advertising budget
is surprisingly difficult. However, there are research inputs that can be helpful.
Tracking studies that show advertising is either surpassing or failing to reach
communication objectives can suggest that the budget should be either reduced or
increased.
• Media research
In evaluating a particular media alternative, it is necessary to know how many
advertising exposures it will deliver and what will be the characteristics of the
audience. A first cut of the vehicle’s value is the cost per thousand (circulation), the
advertisement insertion cost divided by the size of the audience.
2. Sales Promotion Research
There are three major types of sales promotion: consumer promotion, retailer
promotion and trade promotions.
In general, the consumer promotion, manufactures offer of all sales promotion
activities. In consumer promotion, manufacturers offer promotions promotions
directly to consumers, whereas retail promotions involve promotions by retailers to
consumers. Trade promotions involve manufacturers offering promotions to retailers
or other trade entities. Trade entities can also promote to each other. For example ,a
distributor can offer a steep temporary price cut to retailers in order to sell excess
inventory. We call trade promotions, since the recipient of the promotion is a
marketing intermediary.
Sometimes several manufacturers or several retailers combine in one promotion.
These are called cooperative promotions or promotion partnerships.
Manufacture
Trade
Trade promotions
Consumer Consumer Promotions

Retailer Promotions
CONTEMPORARY APPLICATIONS OF MARKETING RESEARCH
1. Competitive Advantage.
The notion that achieving superior performance requires a business to gain and hold
an advantage competitors is central to contemporary strategic thinking. Businesses
seeking advantage are exhorted to develop distinctive competencies at the lowest
delivered cost or to achieve differentiation through superior value. The assessing
competitive advantage can be done in number of ways. The methods can be broadly
classified as market-based and process-based assessment. Market-based
assessment is direct comparison with a few target competitors, whereas process-
based assessment is a comparison of the methods employed.
2. Brand Equity.
Brand equity is defined as a set of assets and liabilities linked to a brand that add to
or subtract from the value of a product or service to a company and/ or its
customers. The assets or liabilities that underlie brand equity must be linked to the
name and/or symbol of the brand. The assets and liabilities on which brand equity is
based will differ from context to context. However, they can be usefully grouped into
five categories:
a) Brand loyalty
b) Name awareness
c) Perceived quality
d) Brand association In addition to perceived quality
e) Other proprietary brand assets: patents, trademarks, channel relationships etc.
Brand loyalty Provides Value to

Customers by enhancing
Customer’s
• Interpretation/
processing of
Name awareness information
• Confidence in the
BRAND EQUITY
Perceived quality Name
Symbol
Provides Value to firm by
enhancing
• Efficiency and
Brand effectivesness
Association • Brand loyalty
• Prices/margins
• Brand extension
• Trade leverage
Other
proprietary
3. Customer satisfaction.
The measurement of customer satisfaction and its link to product/ service attributes
is the vehicle for developing a market-driven quality approach. This approach
requires a sequential research design that uses the results from each research
phase to build and enhance the value of subsequent efforts. During this process, it is
imperative to study customers who were lost, to determine why they left. This issue
must be addressed early in the system design. The steps involved in customer
satisfaction is
a) Define goals and how information will be used
b) Discover what is really important to customers and employees
c) Measure critical needs
d) Act on the information
e) Measure performance over time
f) Issues in questionnaire design and scaling in satisfaction research
4. Total quality management.
TQM is a process of managing complex changes in the organization with the aim of
improving quality.
The power of measurements is clearly visible in applications of quality function
deployment (QFD), a japanese import used to make product design better reflect
customer requirements. In QFD, a multifunctional team measures and analyzes in
great detail both customers attitudes and product attributes. Marketing research
plays a crucial role at this stage of the process. Then the team creates a visual mtrix
in order to find ways to modify product attributes (engineering characteristics) so as
to improve the product on the customer-based measures of product performance.
Along the way, the team must develop a series of measures of several different
types.
EMERGING APPLICATION OF MARKETING RESEARCH
1. Database marketing
A database is a customer list to which has been added information about the
characteristics and the transactions of these customers. Business use it to cultivate
customers – as they seek new customers.
Need
A database provides the means for research to support decisions. It enables profiling
of customers by searching for prospects who are similar to existing customers. It
provides the means for implementation of profitable programs of repeat business
and cross-selling. It assist in marketing planning and forecasting. Further a database
can:
• Match products or services to customers’ wants and needs
• Help select new lists or use new media that fit the profile of existing customers.
• Maximize personalization of all offers to each customer.
• Provide for ongoing interaction with customers and prospects.
• Pinpoint ideal timing and frequently for promotions
• Measure response and be accountable for results
• Help create the offers most likely to elicit responses from customers
• Help achieve a unique selling proposition (USP), targeted to appeal to your
customers.
• Integrate direct-response communication with other forms of advertising
• Demonstrate that customers are valuable asstes.
Types of database
1. Active customers
2. Inactive customers
3. Inquiries
Benefits of database marketing
a) Customers are easier to retain than acquire. The first reason is that it takes five
times the energy and budget to get new customer as it does to keep an existing
one. Also, a disproportionately small number of your customers generate a very
large proportion of your income.
b) Determine their “Lifetime Value”. Building a lasting relationship becomes the
obvious way to a prosperous and profitable future.
c) Developing relationships with customers. Understanding your customers’ tastes
and preferences on an individual basis is the foundation for relationship
marketing. Relationship marketing combines elements of general advertising,
sales promotion, public relations and direct marketing to create more effective
and more effective ways of reaching consumers. It centers on developing a
continuous relationship with consumers across a family of related products and
services.
2. Relationship marketing
The relationship marketing process incorporates three key elements:

1. Identifying and building a database of current and potential consumers, which
records and cross-references a wide range of demographic, lifestyle and
purchase information.
2. Delivering differential messages to these people through established and new
media channels based on the consumers’ characteristics and preferences.
3. Tracking each relationship to monitor the cost of acquiring the consumer and the
lifetime value of his or her purchases.
Marketing planning and information system

Planning system Information system
Strategic plans Database
Tactical plans DSS
Chapter 2.
1. Agree on Research Purpose
Problems or opportunities
Decision alternatives
Research users
2. Establish Research Objectives

Research questions
Hypotheses
Boundaries of study
RESEARCH PROCESS
 STEPS IN THE PROCESS OF
ESTIMATE RESEARCH
THE VALUE
OF DO NOT
INFORMATION CONDUCT MR
Is benefit > cost?
4. Design the research

Choose among alternative research approaches
Specify the sampling plan
Design the experiment
Design the questionnaire
5. Collect the data
6. Prepare and analyze the data
7. Report the research results and provide strategic

recommendations
1. PROBLEM DISCOVERY
It involves a search for causation among symptoms, problems, and decisions. A

symptom is a condition that indicates the existence of a problem, and we, must be
careful not to confuse this with a problem. Symptoms occupy an essential place in
the problem-solving process, for the underlying problem. A problem exists whenever
one faces a question whose answer – or a need whose fulfillment – involves doubt
and uncertainty. If there is no answer or solution, there is no problem (although the
consequences might be terrible); and if there is only a single possible answer or
solution, there is no problem. A decision is a determination or resolution of a
question. In the terms of a business executive, a decision is the determination of a
course of action to be taken. Many routines or repetitive decisions to which
marketing research is applied often invoke a complex of problems, and considerable
work is entailed in the choice of the best available course of action.
Business problems are not found by surprise or accidental circumstances. The
persons who find problems are sensitized to be on the alert and are prepared to find
them. Always there is evidence that the searching mind penetrates with insight. Our
abilities can go beyond intuition or a sixth sense. Fortunately, there are means
available to sharpen our capacities in problem discovery. First, an understanding of
the different types of difficulties or symptoms which may call for decisions is useful.
Second, provision of a marketing information system may often signify the existence
of the problem to a decision maker.
2. PROBLEM DEFINITION
The first step in any marketing research project is to define the problem. In defining
the problem, the researcher should take into account the purpose of the study, the
relevant background information, what information is needed, and how it will be used
in decision making. Problem definition involves discussion with the decision-makers,
interviews with industry experts, analysis of secondary data, and, perhaps, some
qualitative research, such as focus groups. Once the problem has been precisely
defined, the research can be designed and conducted properly.
3. RESEARCH OBJECTIVES
The research objective is a statement, in as precise terminology as possible, of what

information is needed. The research objective should be framed so that obtaining the
information will ensure that the research purpose is satisfied.
Research objectives have three components:
1. Research question: It specifies the information the decision maker needs. The
research question asks what specific information is required to achieve the
research. If the research question is answered by the research, then the
information should aid the decision maker.
2. Development of hypotheses: A hypotheses is a possible answer to a research
question. The research determines which of these alternative answers is correct.
There are three steps to develop the hypotheses
a. The researcher can draw on previous research to generate hypotheses for future
large-scale research efforts. The research purpose might be deciding whether to
conduct the large-scale studies.
b. Second source is theory from such disciplines as psychology, sociology,
marketing or economics. Thus, the economic theory might suggest the
importance of price in explaining a loss of retail sales.
c. The most important source of developing hypotheses is the manager’s
experience with related problems, coupled with knowledge of the problem
situation and the use of judgment.
3. Research boundaries: Hypotheses development helps make the research
question more precise. Another approach is to indicate the scope of the research
or the research boundaries. For example, is the interest in current customers
only or in all potential customers?
4. Hypotheses development model
Source
• Theory
• Management
experience
• Exploratory
Research Research Hypothesi Research

Purpose Question s design
Research
Objective
Development of an approach to the problem includes formulating an objective or

theoretical framework, analytical models, research questions, hypotheses, and
identifying characteristics or factors that can influence the research design. This
process is guided by discussions with management and industry experts, case
studies and simulations, analysis of secondary data, qualitative research, and
pragmatic considerations.
4. RESEARCH DESIGN
The research problem having been formulated in clear terms, the researcher will be
required to prepare a research design, i.e. he will have to state the conceptual
structure within which research would be conducted. The preparation of such a
design facilitates research to be as efficient as possible yielding maximal information.
But how all these can be achieved depends mainly on the research purpose.
Research purposes may be grouped into four categories, viz.,
(i) Exploration
(ii) Description
(iii) Diagnosis
(iv) Experimentation
A flexible research design, which provides opportunity for considering many different
aspects of a problem, is considered appropriate if the purpose of the research study
is that of exploration. But when the purpose happens to be an accurate description of
a situation or of an association between variables, the suitable design will be one
that minimizes bias and maximizes the reliability of the data collected and analyzed.
There are several research designs, such as, experimental and non-experimental
hypothesis testing. Experimental designs can be either informal designs (such as
before-and-after without control, after-only with control before-and-after with control)
or formal designs (such as completely randomized design, randomized block design,
Latin square design, simple and complex factorial designs), out of which the
researchers must select one for his own project.
The preparation of the research design, appropriate for a particular research
problem, involves usually the consideration of the following:
(i) the means of obtaining the information
(ii) the availability and skills of the researcher and his staff (if any)
(iii) explanation of the way in which selected means of obtaining information will
be organized and the reasoning leading to the selection
(iv) the time availability for research and
(v) the cost factor relating to research, i.e. the finance available for the purpose.
5. RESEARCH METHOD
In dealing with any real life problem it is often found that data at hand
are inadequate, and hence, it becomes necessary to collect data which
differ considerably in context of money costs, time and other resources
at the disposal of the researcher.
Primary data can be collected either through experiment or through survey. If the
researcher conducts an experiment, he observes some quantitative measurements,
or the data, with the help of which he examines the truth contained in his hypothesis.
But in the case of a survey, data can be collected by any one or more of the following
ways:
(i) By observation: This method implies the collection of information by way of
investigator’s own observation, without interviewing the respondents. The
information obtained relates to what is currently happening and is not
complicated by either the past behavior or future intentions or attitudes of
respondents. This method is no doubt an expensive method and the
information provided by this method is also very limited. As such this method
is not suitable in inquiries where large samples are concerned.
(ii) Through personal interviews: The investigator follows a rigid procedure and
seeks answers to a set of pre-conceived questions through personal
interviews. This method of collecting data is usually carried out in a structured
way where output depends upon the ability of the interviewer to a large extent.
(iii) Through telephone interviews: This method of collecting information involves
contacting the respondents on telephone itself. This is not a very widely used
method but it plays an important role in industrial surveys in developed
regions, particularly, when the survey has to be accomplished in a very limited
time.
(iv) By mailing of questionnaires: The researcher and the respondents do not
come in contact with each other if this method of survey is adopted.
Questionnaires are mailed to the respondents with a request to return after
completing the same. It is the most extensively used method in various
economic and business surveys. Before applying this method, usually a Pilot
Study for testing the questionnaire is conducted which reveals the weakness,
if any, of the questionnaire. Questionnaire to be used must be prepared very
carefully so that it may prove to be effective in collecting the relevant
information.
(v) Through schedules: Under this method the enumerators are appointed and
given training. They are provided with schedules containing relevant
questions. Data are collected by filling up the schedules by enumerators on
the basis of replies given by respondents. Much depends upon the capability
of enumerators so far as this method is concerned. Some occasional field
checks on the work of the enumerators may ensure sincere work.
The researcher should select one of these methods of collecting the data taking into
consideration the nature of investigation, objective and scope of the inquiry, financial
resources, available time and the desired degree of accuracy. Though he should put
attention to all these factors but much depends upon the ability and experience of
the researcher.
6. DATA COLLECTION
The research design has a wide variety of methods to consider either singly or in
combination. They can be grouped first according to whether they use secondary or
primary sources of data.
• Secondary data are already available, because they were collected for some
purpose other than solving the present problem.
• Primary data are collected especially to address a specific research objective. A
variety of methods, ranging from qualitative research to surveys to experiments,
may be employed.
7. SAMPLING METHODS
There are different types of sampling designs based on two factors viz., the
representation basis and the element selection technique. On the representation
basis the sample may be probability sampling or it may be non-probability sampling.
Probability sampling is based on the concept of random selection, whereas non-
probability sampling is ‘non-random’ sampling. On element selection basis, the
sampling is non-random sampling. On element selection basis, the sample may be
either unrestricted or restricted. When each sample element is drawn individually
from the population at large, then the sample so drawn is known as ‘unrestricted
sample’, whereas all other forms of sampling are covered under the term ‘restricted
sampling’. The following chart exhibits the sample designs
Representation basis
Element selection
technique Probability sampling Non-probability
sampling
Unrestricted sampling Simple random sampling Haphazard

sampling
or
convenience sampling
Restricted sampling Complex random sampling, Purposive sampling

(such
(such as cluster sampling, as quota sampling,
systematic sampling, judgment sampling)
Stratified sampling etc.)
1. Probability sampling
a. Simple random sampling.
b. Systematic random sampling.
c. Stratified random sampling
d. Cluster sampling
e. Multi stage sampling
2. Non-probability sampling
a. Judgment sampling
b. Quota sampling
c. Convenience sampling
8. USES OF SCALES IN RESEARCH
In research when the concepts to be measured are complex and abstract and we
don not possess the standardize measured tools. Alternatively, we can say that while
measuring attitude and opinions, we face the problem of their valid measurement. A
researcher may face similar problem. To avoid this problem the scaling technique is
used. Different types of scaling methods are:
1. Rating scales
a. The graphic rating scale
b. The itemized rating scale
2. Ranking scales
a. Method of paired comparison
b. Method of rank order
3. Arbitrary scale
4. Differential scale (Thrustone-type scale)
5. Summated scales (Likert scale)
9. DATA PROCESSING
Data processing’s total task in carrying out the analytical program is to

convert crude fragments of observation and responses into orderly
statistics for interpretation. The seven stages of data processing are
given below:
1. Data preparation. There are three preparation stages necessary in either
manual or computer processing: editing, classifying and coding. An additional
stage with computers is card punching.
2. Programming. Every data-processing job, whatever the method used, needs
preplanning that specifically lays out directions to the persons doing tabulating
(manually) or to the machinery (with computers). This describes specifically the
particular operations to take place, with what equipment, by whom, and so forth.
3. Sorting. All the bits of data have to be classified together with the other bits that
are of the same nature, by being sorted into groups.
4. Counting. When the preparatory work has been done, the individual
observations can be counted and accumulated in subtotals of the prescribed
classifications.
5. Summarizing. The various subtotals and totals are brought together and
summarized in tables that will exhibit the data in an informative manner.
6. Computations. When computers are employed, various calculations May be
performed with the data during the tabulation operations. When other methods
are utilized, the computations are performed as separate stages subsequent to
the preparation of tables.
7. Control. Means for making proper checks of the accuracy of the data processing
are practically essential. This includes examination of the coding and, if machines
are used, the card punching and programs. Also, a base total of the number of
questionnaire or other data forms being processed should be determined before
the processing begins, thereby providing a total with which to verify whether each
data breakdown, or analysis, totals to exactly this base figure.
10. DATA ANALYSIS
After the data have been collected, the researcher turns to the task of analyzing
them. The analysis of data requires a number of closely related operations such as
establishment of categories, the application of these categories to raw data through
coding, tabulation and then drawing statistical inferences. The unwieldy data should
necessarily be condensed into as few manageable groups and tables for further
analysis. Thus, researcher should classify the raw data into some purposeful and
usable categories. Coding operation is usually done at this stage through which the
categories of data are transformed into symbols that may be tabulated and counted.
Editing is the procedure that improves the quality of the data for coding. With coding
the stage is ready for tabulation. Tabulation is a part of the technical procedure
wherein the classified data are put in the form of tables. The mechanical devices can
be made use of at this juncture. Computers tabulate a great deal of data, especially
in large inquiries. Computers not only save time but also make it possible to study
large number of variables affecting a problem simultaneously.
Analysis work after tabulation is generally based on the computation of various

percentages, coefficients etc., by applying various well-defined statistical formulae.
In the process of analysis, relationships or differences supporting or conflicting with
original or new hypothesis should be subjected to tests of significance to determine
with what validity data can be said indicate any conclusions. For instance, if there
are two samples of weekly wages, each sample being drawn from factories in
different parts of the same city, giving two different values, then our problem may be
whether the two mean values are significantly different or the difference is just a
matter of chance. Through the use of statistical tests we can establish whether such
a difference is a real one or is the result of random fluctuations. If the difference
happens to be real, the inference will be that the two samples come from different
universes and if the difference is due to chance, the conclusion would be that the two
samples belong to the same universe. Similarly, the technique of analysis of variance
can help us in analyzing whether three or more varieties of seeds grown on certain
fields yield significantly different results or not. In brief, the researcher can analyze
the collected data with the help of various statistical measures.
11. RESEARCH REPORT
Finally, the researcher has to prepare the report of what has been done by him.
Writing of report must done with great care keeping in view the following:
(1) The layout of the report should be as follows:
(i) the preliminary pages.
(ii) the main text and
(iii) the end matter
In its preliminary pages the report should carry title and date followed by
acknowledgments and foreword. Then there should be a table of contents followed
by a list of tables and list of graphs and charts, if any, given in the report.
The main text of the report should have the following parts:
(a) Introduction: It should contain a clear statement of the objective of the research
and an explanation of the methodology adopted in accomplishing the research.
The scope of the study along with various limitations should as well as stated in
this part.
(b) Summary of findings: After introduction there would appear a statement of
findings and recommendations in non-technical language. If the findings are
extensive, they should be summarized.
(c) Main report: The main body of the report should be presented in logical sequence
and broken-down into readily identifiable sections.
(d) Conclusions: Towards the end of the main text, researcher should again put down
the results of his research clearly and precisely. In fact, it is the final summing up.
At the end of the report, appendices should be enlisted in respect of all technical
data. Bibliography, i.e., list of books, journals, reports etc., consulted, should also be
given in the end. Index should also be given specially in a published research report.
(2) Report should be written in a concise and objective style in simple language
avoiding vague expressions such as ‘it seems,’ ‘ there may be’, and the like.
(3) Charts and illustrations in the main report should be used only if they present the
information more clearly and forcibly.
(4) Calculated ‘confidence limits’ must be mentioned and the various constrains
experienced in conducting research operations may as well be stated.

Chapter 1: Research Fundamentals Chapter 2: Research Process

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Chapter 2 - Research Process

Chapter 1 : Research Fundamentals

Chapter 2: Research Process

Chapter nos. Topics Page nos.

Research is an academic activity and such a term should be used in a technical

The purpose of research is to discover answers through the application of

• To portray accurately the characteristics of a particular individual, situation

 BASIC VS APPLIED RESEARCH

 INFORMATION SYSTEMS, DECISION SUPPORT SYSTEMS, AND

An information system (IS) is a continuing and interacting structure of

Information systems contain three types of information.

Decision support system

Application information system to marketing research

MARKETING DECISION SUPPORT SYSTEMS

A good MDSS should have the following characteristics

A typical MDSS is assembled from four components

Some of the limitations faced by the researchers in MR are:

 APPLICATION OF MARKETING RESEARCH

TRADITIONAL APPLICATION OF MARKETING RESEARCH

Traditionally, marketing decisions have been divided into 4P’s – product,

Concept Evaluation and

Product Evaluation and

Testing the Marketing

There are two types of concept generation research. They are:

2. Product Evaluation and development

Product evaluation and development, or product testing, is very similar

Really new product

II. PRICING RESEARCH

III. Distribution research

offered. The discount to be offered to the members in the channel of distribution

a. Warehouse and Retail Location Research

The essential questions to be answered before a location decision is

neighborhood, income levels, and competitive stores. Regression models

b. Number and location of Sales Representatives

How many sales representatives should be in a given territory? There

IV. Promotion research

Most companies concentrate on advertising because advertising decisions are more

2. Sales Promotion Research

Consumer Consumer Promotions

CONTEMPORARY APPLICATIONS OF MARKETING RESEARCH

Brand loyalty Provides Value to

4. Total quality management.

EMERGING APPLICATION OF MARKETING RESEARCH

Benefits of database marketing

The relationship marketing process incorporates three key elements:

Marketing planning and information system

2. Establish Research Objectives

4. Design the research

5. Collect the data

6. Prepare and analyze the data

7. Report the research results and provide strategic

It involves a search for causation among symptoms, problems, and decisions. A

The research objective is a statement, in as precise terminology as possible, of what

Research Research Hypothesi Research

Development of an approach to the problem includes formulating an objective or

Unrestricted sampling Simple random sampling Haphazard

Restricted sampling Complex random sampling, Purposive sampling

8. USES OF SCALES IN RESEARCH

Data processing’s total task in carrying out the analytical program is to

10. DATA ANALYSIS

Analysis work after tabulation is generally based on the computation of various

11. RESEARCH REPORT