Marketing Research:

Module II : The research Process.

Facilitator: Prof: Sreekumar Pillai.
For MBA Batch 6.
Semester 4.

The types of Marketing

researches:

Basic Research or pure fundamental research.

Research conducted to extend the horizons in knowledge having no
identified problem for solving. Finding the effect of globaisation
on rural markets etc.

Applied research.
Applying the various marketing techniques that have been
established due to basic research in order to solve marketing
problems.

Designated fact gathering.

This is an exercise for gathering predetermined data which is
important for marketing decisions. Eg checking brand recall or
market share.

Steps in Marketing research:

1.Problem Definition.

2.Research Design

3.Field work

4.Data Analysis and interpretation.

5.Report presentation.

Problem Definition:
This first step is critical for the success of
the MR process.
A problem well designed is half solved.
Problem should be described and defined
clearly.
The right problem should be sought out.
The type of research to be used must
be compatible for solving the problem.

Visible symptoms.
Eg: falling
sales,low profits

Real hidden
problems.
eg

Ice-berg principle

Inefficient sales
force,falling
quality,lack of
adaptation.

Key questions to be asked in problem identification

Can the problem and /or opportunity be resolved

using only subjective information?
Does the problem/opportunity situation have
strategic or tactical importance?
Does adequate information for addressing the
defined problem already exist within the
companys internal record systems?
Is there enough time to conduct the research
before the final management decision must be
made?
Is money budgeted for doing the formalised
research ?
Do the benefits of having the additional
information outweigh the costs of gathering the
information?

Type of information: can the decision problem/

opportunitybe resolved using
only subjective information?
(Decision makers responsibility)
No

Nature of Decision: Is the

problem/opportunity situation of
strategic or tactical importance?
(Decision makers responsibility?

Yes

Do not undertake the information

Research process.

No
Yes

The decision maker should bring in the researcher

Availability of Data: Is the existing secondary

Information inadequate for solving the
Problem situation?
(Decision makers responsibility with researchers advice)

No

Yes
Time constraints:Is there a sufficient time frame available
for gathering the information before the final managerial
Decision must be made?

No

(Decision makers responsibility with researchers advice)

Yes
Resource requirements:Are there sufficient levels
of money,staff,and skills to meet the costs and marketing
Research requirements?
(Decision makers responsibility with researchers advice)

No

Yes
Benefits versus costs: Does the expected value of the
information exceed the costs of conducting the research?
(Decision makers responsibility with researchers advice)
Yes
Move onto phase 1
of the research

No

Steps in the Research process

Problem definition:
1)Identify and clarify information needs.
2)Specify the research questions and
define the research problem.
3)Confirm the research objectives and
assess the value of information.
Research Design:
1) Determine the research design and data
sources.
2) determine the sample plan and sample
size.

Remaining Steps in the Research process

3)Assess measurement issues and

scales.
4) Pretest the questionnaire.
Field Work:
1) collect and prepare data.
Data analysis and interpretation:
1) analyse the data.
2) Transform data structures into
information.
Report presentation:
1)Prepare and present the final
report to the management.

Problem identification:
Situational analysis: This is the analysis of
the environment(both internal and
external) of the organisation which seeks
to identify the problem.
Information regarding a) the product
b) the company, industry and competition.
c)The market d) The channel of
distribution e) the sales organisation
f)The advertising and sales promotion.. are
all vital for arriving at the true nature of
the problem.

Situational analysis:

Understand the complete problem situation.(The

decision makers needs,the complexity of the
problem situation,the types of factors involved).
Identify and separate out measurable symptoms.
Determine the unit of analysis (individuals /
organisations/departments /geographical areas
etc)
Determine the relevant variables to the situation.
(independant/dependant variables)

Some preliminary steps to understand the

problem better:

Informal investigation:
This is the next step and refers to
the discussions with a few selected
customers,dealers,top management
personnel of the company and any
other party who may have
association with the problem to be
identified.

The pilot study: for problem

identification..

The informal investigation is also referred

to as the pilot study. Here the problem and
the proposed techniques to solve it are
thoroughly discussed with a panel of
experts and respondents.The informal
investigation serves three purposes:
1) To develop and select the hypothesis to
be used in the final study.
2)to estimate the complexity of the market
and environment.
3)Confirm the research objectives and
assess the value of the information.

Research design.
Research design:
Once the problem has been defined the
next step ie research design becomes
easier.This is the basic framework which
provides the guidelines for the rest of the
research process.this is the map or blue
print based on which the research is to be
conducted.The research design specifies
the methods of data collection and data
analysis.

Main outcome from the research design:

Determine the blue print of the

research and the data sources.
Develop sampling design and sample
size.
Assess measurement issues and
scales.
Pretest the questionnaires.

Exploratory research

This type of research is to explore or search

through a problem or situation to provide insights
and understanding.This type of research is used
mainly :
To formulate a problem or define a problem more
precisely.
To identify alternate courses of action.
Develop hypothesis.
Isolate key variables and relationships fr further
examination.
Gain insights for developing an approach to the
problem.
Establish priorities for further research.

Exploratory Research:
Objective:
Discover ideas and insights.
Characteristics:
Flexible,versatile often the front end of
the total research design.
Methods:
Expert surveys,pilot surveys,secondary
data,qualitative research.

Descriptive research

This is the type of research that uses

a set of scientific methods and
procedures to collect raw data and
create data structures that describe
the existing characteristics of a
defined target population or market
structure.

Descriptive research:
Objective: to describe market
characteristics and effect relationships.
Characteristics:
Marked by the prior formulation of
Specific hypothesis.Preplanned and
structured design.
Methods:
Secondary data analysed quantitatively.
Surveys, Panels,Observational and other
data.

Causal research

This is research designed to collect raw

data and create data structures and
information that will allow the researcher
to model cause and effect relationships
between independent and dependent
variables. Causal research can be used to
understand the causal factors and the
outcome predicted.
Mainly
used
to
test
If-then
characteristics of marketing factors.

Causal Research:
Objective:
Determine cause and effect
relationships.
Characteristics:
Manipulation of one or more
independent variables.Control of
other mediating variables.
Methods:
Experiments.

Data collection methods:

This refers to the collection and

preparation of data.
There are two types of data,
Secondary data
&
Primary Data

Secondary Data:

This is data that :

1) Already exists in some type of a
recognisable format.
2)The data has been aleady been fully or
partly interpreted by somebody.
3) the data is understandable and useful
for the researcher.
Examples are libraries,internet,research
agencies selling market information.

Primary data:

Primary data represents first hand

Raw data and data structures that
have not had any type of meaningful
interpretation.primary data are the
result of conducting some type of
Exploratory,descriptive or casual
research that employs either surveys
or observation to collect the data.

Methods of collecting primary data:

1) Observation:
In this method we directly observe the
actions of the respondents either directly
mixing with them or indirectly without
getting mixed up with them.In direct
observation method the purpose of our
study is known to the respondents and in
indirect observation it is not.

Methods of collecting primary data

Experimentation:
This method emphasises the creation of a
controlled environment where some
variables are allowed to vary and the
cause and effect relationship is studied. eg
effect of advertising on an FMCG item by
testing it on three markets(doubling the
budget in one market,halving in the
second and maintaining the same in the
third).

Methods of collecting primary data

Surveys:
One of the mosy common and widely used
methods of primary data collection.By
using surveys we can gather a wide range
od valuable information on overt
behaviour of the
customer..attitudes,motives and
opinions.The survey may be undertaken
any any component of the channel of
distribution of a consumer item.

Research instruments;
For the observation method:
cameras,tape recorders,video
recorders.
For the experimentation method:
Same as above.
For the Survey method:
Questionnaire,personal interviews with
recording,telephone interview with or
without recording.

Sampling plan.
The sampling plan is based on the
following factors:
What sampling unit should be studied?
The sampling unit is the entity on which the
research will be based on.
Eg.. For a survey on the consumer attitude
survey for soaps, husbands,wives,children
or a combination of the three may be
used.

Sampling plan.

What should be the sample size?

The whole of the universe cannot be studied in a
single research project.
A relevant fraction of the universe which is
representative of the entire universe must be
selected.Generally in explorative study a sample
which is about 1% of the universe is sufficient if
the sample has been selected properly.In
motivation research a sample of around 30 is
sufficient to reveal significant attitudes.However it
is thought that sample size must not be more
than 10 % of the universe.

Syndicated data (Commercial data)

Data that have been compiled

according to some standardised
procedure .This type of data often
provides customised data for
companies such as market share,ad
effectiveness and sales tracking.
Major data collection methods are
1)Consumer panels 2) Store audits
and 3) Optical scanner technology.

Consumer Panels

These are large samples of

households that provide specific
detailed data for an extended period
of time.
Data provided by these panels
usually consist of product purchase
information or media habits.
Panels are designed and developed
by marketing research firms.

Benefits of consumer panels;

Lower costs than primary data

collection .
Rapid availability and timeliness.
Accurate reporting of socially
sensitive expenditure.
(alcohol,cigarettes etc)
High level of sensitivity( actual vs
intention).

Weaknesses in Consumer panel data:

Sampling errors possible as most

consumer panels underrepresent
minorities.
Turnover: As there is no obligation
for members to stay for the entire
duration.
Response bias: Most panel
respondents have a tendency to
answer questions in a socially
desirable manner knowing that their
purchases will be scrutinised.

Some examples of Consumer

panel data sources:

National family opinion(NFO) in the U.S.

has panels of more than 450,000
households and collects data on
brands,awareness,usage .
The NPD group in the US releases data
from 14,000 households in the form of the
Consumer report on eating share
trends(CREST) which is a powerful source
of food and beverage eating habits.

The Indian panels;

The organisations such as M.A.R.G

and O.R.G have around 50,000
households each to collect data on
product usage and media
preferences of the Indian consumer.

Store audits:

This is the formal examination and

verification of how much of a particular
product or brand has been sold at the
retail level.
This activity is based on a collection of
participating retailers (discount
stores,supermarkets,drugstores).
Audits are performed on product or brand
movement in return for detailed activity
reports and cash compensation to the
retailer.

Benefits of store audits:

The main benefits are that they are

timely and accurate(precision).
This system eliminates the bias of
respondents.
The sales and sales promotion
methods of all the brands are
available from each source.

Weaknesses in the store audit system ;

In reality this is not an audit as
100% stores cannot be
incuded(max75%).
It is possible that very small sales
figures in each store or stores which
sell very less may be avoided.
This will spoil the national average .
Possible that the sample may not be
homogenous.

Data collection: The survey method.

The survey research method is a

procedure for collecting large
amounts of raw data using questionand-answer formats.

Advantages of the survey method:

Can accommodate large sample sizes and
generalise the results.
Can distinguish small differences and
Regional preferences.
Ease of administering and recording
questions and answers.
Ability to use advanced statistical analysis.
Factors and relationships not directly
measurable can be studied(attitudes ,
feelings and preferences.)

Disadvantages of the survey method:

Difficulty of developing accurate survey

questionnaires.
Limits to the in-depth detail of the data.
Limited control over timeliness and
potentially low response rates.
Evaluating whether respondents are
responding truthfully.
Misinterpretation of data and inappropriate
use of analysis procedures.

Types of Errors in Survey methodology:

The errors can be primarily divided into two:

Sampling Errors: This is the statistically

measured difference between the actual sample
results and the true population results.This can
be avoided by choosing appropriate sampling
methods and/or by increasing the sample size.
Systematic errors(Non-sampling errors):
this constitutes all errors that can enter the
survey research design that are not related to the
sample method or sample size.

Systematic errors:

The systematic errors can be divided

into the following types:

Respondent errors.
Measurement/design errors.
Faulty problem definition.
Project administration errors.

Respondent errors:
Respondent errors can be classified as under.
Nonresponse errors: this is a systematic bias that occurs
when the final sample differs from the planned sample.
like not at home,wrong postal,e-mail address,refusal.

Response errors.
a)Deliberate falsification
hostility,social desirability error,auspices error(Ego
enhancing),yea and nay saying(guessing).
b)Unconscious misrepresentation:
extremity error(faulty memory),mental set,acquisence
error(newly acquired attitudes),prestige.

Measurement/design errors.

Construct development errors.

This refers to the error in identifying data requirement.
Scale measurement errors.
lack of precision,ambiguity,inappropriate use of scales.
Survey instrument design errors.
Leading questions,improper sequence of questions,lack of
instructions, lenghty questionnaire.
Data analysis errors.
Inappropriate analysis technique.
Misinterpretation errors.
Interpretive bias, selective perception.

Problem definition errors:

Please refere importance of problem

identification and definition.

Researchers administrative errors.

Data processing errors:

Data coding errors,data entry
errors,data editing errors.
Interviewer errors:
recording error,cheating,unconscious
misinterpretation.

Types of Survey research methods:

Person administered.
In-home interview,executive interview,
mall-intercept interview,purchase
intercept interview.
Telephone administered.
Telephone interview,Computer
assisted telephone interview(CATI),
Completely automated telephone
survey(CATS),mobile phone survey.

Types of survey research:

Self administered:
Mail Panel survey,drop off survey,mail
survey.

Computer assisted(on-line survey).

Fax survey,E-mail survey,internet
survey.

Experiments in marketing research:

Experiments are used mainly for

Causal research.It is important to
know the two main components vital
for experimental research;
1) Variables.
2) Functional relationship.

Variable:

A variable is any observable and

measurable element or attribute of
an item or event.They are the
qualities the researcher
specifies,studies and draws
conclusions about. Eg; the
brand,colour,fuel type,engine
capacity of a car.

Functional relationship:

This is an observable and systematic

change in one variable as another
variable changes.

Eg the time taken for an order to be

served at a fast food restaurant
depends on the quantity ordered.

Variables in Experimental design:

There are four types of variables:

1) Independent.
2)Dependent.
3)Control.
4)Extraneous.

Independent variable:

This is a variable whose values are

directly manipulated by the
researcher.This is also called the
predictor or treatment variable(X).
The independent variable is assumed
to be the causal factor of a functional
Relationship with a dependent
variable.

Dependent variable:

This is the observable measure or

effect or outcome that occur during
the experiment or measures of
change in the conditions that exist
after the experiment is completed.
Eg of dependent variables are unit
sales,profit levels and market shares.

Control variables:
These are variables that the researcher
does not allow to vary freely or
systematically with independent
variables.Control variables should not
change as the independent variable is
manipulated.
Though it is impossible to control all
Conditions the researcher must however
control as many as he/she can.

Extraneous variables:
Variables that cannot be controlled
by researchers but that should
average out over different trials and
thus not systematically affect the
results of the experiment.
Eg weather,health of the shoppers,
Economic environment,shopping
ambience etc.

Role of theory in experimental research

Theory is a large body of

interconnected propositions about
how some portion of a certain
phenomenon operates.Theory is the
basis on which hypotheses are
developed.Thus hypotheses are
smaller versions of theories.

Experimental research:
An emprical investigation that tests
for hypothesised relationships
between dependent variables and
manipulated independent variables.
Experimental research is mainly a
hypothesis testing method and is
classified as a deductive research.

Deductive research:

Experimental investigations that are

undertaken to test hypothesised
relationships.Researchers derive a
hypothesis from a theory ,design an
experiment,and gather data to test
the hypothesis.

Inductive research:
An investigation that uses casual
design procedures to generate and
test hypotheses that creates new
theories or extends existing theories.
The need for inductive research is
often identified because of new data
that comes available from deductive
research.

Validity:

This is the extent to which the

conclusions drawn from the
experiment match the truth of real
life situations.
The main factor that affect validity is
the presence of numerous
extranneous variables which may
contaminate the functional
relationship.

Types of validity:

Validity needs to be verified in

relation with three factors:

Internal validity.

External validity.

Construct validity.

Internal Validity:

This refers to the extent to which the

research design actually defines
causal relationships.Thus internal
validity exists when the researcher
can rule out other explanations for
the observed conclusions about the
functional relationships.
Eg: the experiment on buyers
preference for highly frosted cakes.

External validity:

This is the extent to which the causal

relationship found in a study can be
expected to be true for the entire
target population. Numerous
extranneous variables can affect the
validity of the experiment so that the
external validity is adversely
affected.

Construct validity:

The extent to which the variables

under investigation are completely
and accurately identified prior to
hypothesising any functional
relationship.

Types of experimental research

designs.

To understand experimental research design one

should first of all understand the symbols that
represent the design:
X=this refers to the exposure of an independent
variable to a group of test subjects for which the
effects are to be determined.
O= the process of observation or measurement of
the dependant variable(outcome) on the test
subjects,
[R]= The random alignment of test subjects to
separate treatment groups.

Symbols:

EG= The experimental group of test

subjects.
CG= control group of test subjects.
=A movement through time
,-normally displayed as left to right
movement.

Types of experimental designs.

Experimental designs are of three

types.
1)Pre-experiments.
2)True experiments.
3)Quasi-experiments.

Pre-experimental design.
This category has three types:
1) One-shot study.
(EG) = X
O
2) One group pretest-posttest.
(EG)= O
X
O
3)Static group comparison.
(EG): X
O
(CG) :
O

Types of experimental research designs.

True experimental designs:

True experimental designs are characterised by
the random assignment to the groups both
experimental as well as the control.
There are two types of experimental design in this
category.
Randomised pre-test-posttest control group.
(EG ): [R] O
X
O
(CG) : [R] O
O

The treatment effect(TE) of the experiment

manipulation being:
TE=(O -O) (O -O).

True experimental design.

Posttest-only Control group.

This is similar to the first type except

that pretest measures of the
dependant variables is absent:
(EG): [R] X
(CG): [R]

O
O.

True experimental design:

Solomon four group.
This is a combination of the pretestposttest control group and the posttest
only control group experimental design.
Design 1:
(EG): [R] O
X
O
(CG): [R] O
O
Design 2:
(EG): [R]
X
O
(CG) :[R]
O6

Quasi experimental designs:

This type of experiment design is

appropriate when the researcher is
able to control some variables like
price level,package design etc but
Cannot establish equal experimental
and control groups
based on
randomisation.

Types of quasi-experimental design:

Non equivalent control groups.

Group 1 (EG): O
X
O.
Group 2 (CG): O
O
Separate-Sample
Sample 1 O
Sample 2

Pretest-Posttest.
(X)
(X)
O

Field experiments:

These are Causal research designs

That manipulate the independent
variables in order to measure the
dependent variable in a natural
setting of the test.
A perfect example of this method is
test marketing.