3.1Marketing Research & MIS

8/8/2019 3.1Marketing Research & MIS

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What is Marketing Research ?What is Marketing Research ?

The marketing research is the process of systematic identification,design, collection, analysis and reporting of data and findings

relevant to specific marketing situation facing the company.

To assess their own past performance as well as

To acquire good understating of their own market e.g. HUL

How to gain and retain competitive advantages-

To monitor changing environment.

-e.g.Parles Goldspot, Limca, Thumps up

Objective of Marketing Research

To study buyer behavior, change in consumer lifestyle,

To forecast the volume of future sales or expected market share

consumption patterns, brand loyalty and forecasting demand in

change market condition.

Failure of MR- e.g. NDA , Coke 7X


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Features of Marketing ResearchFeatures of Marketing Research

It is a systematic process It has to be carried out in astepwise and systematic manner and the whole process need

to be planned with a clear objective.

It should be objective- It is important that the methodsemployed and interpretations are objective.

It is multi-disciplinary Market research draws concepts from

other disciplines such as Statistics for obtaining reliable data

and from Economics, Psychology and sociology for better

understanding of buyers.

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Marketing Research ProcessMarketing Research ProcessDefine the problem and

research objectives

Develop the ResearchPlan & Design

Collect the information

Analyze theinformation

Present the findings

Make the decision4


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StepStep--1:Defining Research Problem1:Defining Research ProblemDefine the Problem- It is very important to define theproblem properly as being the first step in the process, any errorin this can mislead the entire study towards in correct result.

A careful and precise definition of marketing problem will lead touseful and relevant results which can solve marketing problem.

But it should not define the problem in too narrow.e.g. Introduction of Internet facility to jet airways can create profit.

Use probing technique to achieve a consensus on problemdefinition. Ask question like -

How do you explain it? How important it is? Should it offer in all

the flight, class, route ? Why does it should happen?What will be the price? What if the price is ?

When did it last happen? Who are the other competitor ?

Tell me more!

How important is it to be first in the market and how long can theCo. sustain its lead. The Researcher has to be good listener.


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StepStep--1:Defining Research Problem1:Defining Research Problem

Situation Analysis-

It is important that researcher conducts a situationanalysis at this stage to examine the how, why, when andwhere of the problem.

Literature Review-

It is necessary that the researcher examines company

Records , industry data, competition data to arrive at acorrect assessment of the situation.

Internet, Intranet,

Once the problem is identified it is important tounderstand exactly what needs to be examined i.eResearch Objective.


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StepStep--I:Defining Research ObjectiveI:Defining Research ObjectiveD

efining Research Objectives-Once the problem is defined,the researcher wants to achieve the solution for the identified

problem which should be specific, attainable and measurable.

e.g.

-To determine the market penetration of the company in

metros and other urban cities

-To determine the ratio of brand sales to industry sales.

-To assess motivation level of channel members and to

evolve an incentive plan for enhancing it.

The purpose of the objective is to act as guide to the

researcher and help him focus throughout the research.


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StepStep--II Develop the Research DesignII Develop the Research DesignThere are three type of Research Design-

A) Exploratory When researcher does not know how and why acertain phenomena has occur. Its goal is to highlight the real natureof the problem and to suggest possible solutions or new ideas. Thisresearch is unstructured. Focus group interviewing, experts, andeven search for printed or published info. are common technique.

e.g. To evaluate the quality of bank, hotel or airlines. While in the mfc.

Co. we can know this on the basis of tangible features like warranty.B) Descriptive-It seeks to quantify demand, descriptive research is

carried out when the researcher understands the behavioralcharacteristics.

e.g. TV viewing habits, How many first class passenger would

purchase in-flight internet services at Rs500/- extra.

C) Causative research is done to establish a cause and effectrelationship. e.g. influence of income and lifestyle on purchasedecision. Hypothesis are tested.

A hypothesis is a statement, idea or suggestion based on knownfacts and is used as a basis for further investigation


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StepStep--II Development of Research PlanII Development of Research PlanA research plan is the framework within which collection andanalysis of data is undertaken. This steps involves -

The Date Sources

Research Approaches

Research Instruments

Sampling Plan andContact Method

The Date Sources:

Researcher has to decide which data source is to use - Secondary

data, Primary data or both.

Secondary data are the data which were collected for other purposeor for commercial purpose for selling and already exist.

Primary data are the data freshly gathered for a specific researchproject. Researchers usually look for secondary data to see whetherthe research problem can be partly or fully solved w/o prim.data.


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StepStep--II Sources of Secondary DataII Sources of Secondary Data

Sources ofSecondary Data collected earlier by someoneelse. e.g printed, published reports, news items, industry ortrade statistics. These are important to researchers as theyprovide an insight to the problem. Often preliminaryinvestigation is restricted to the secondary data.

NRS(National Readership Review), NCAER (National Council ofApplied Economics Research), CMIE(Centre for MonitoringIndian Economy), ET Research Bureau, BT, BW, BI, BS, A&Metc.

New age ofSecondary Information-

World wide web like - Census of India. www.censusindia.net

Internet search www.google.com

Online Newsgroup, Discussion group-

Marketing Research company-

Database on CD ROM

Geographical Information System


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Sources of Secondary DataSources of Secondary DataInternal Data - With increasing complexity in the marketplace due to enhanced competition companies need to takefaster decision.

For this purpose most companies have today created DBMS.

It has two component Data warehouse & data retrievalsystem.

DBMS involves recording data in the computer, organizing itfor effective use, updating and maintaining it and retrievingthe information for decision making. Generally this data is on

customer territories and brands.

Internal document like invoices, sales call report, salesterritory report, payment history, dispatch records. Presentinformation on customer preferences, loyalty,


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Secondary Data SourceSecondary Data Source --DatabaseDatabase

MarketingMarketing

Database Marketing can assist in

-Identification of most and least profitable customer

-Identification of attractive market segments & target

Customer .-Evaluation of Sales territories

-Identification of new market opportunities

-Evaluation or modification of Marketing programs.

-Database marketing can help customize the marketingeffort. E.g Shopper stop, Jet airways, City bank,Vodafone etc applying this approach.


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Secondary Data SourcesSecondary Data Sources

Advantages-Saves time and cost

May provide direction to thinking,

Can help, clarify redefined the problem.

May provide necessary background, add creativity for the

research report

Limitation ofSecondary Data-

Lack of availability, relevance, inaccuracy and inefficiency.

e.g. company specific or brand specific consumer responsesare not within the domain of secondary data.

Inaccuracy is created by factors like source and purpose of

data, time when data was collected, methodology deployed


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Researchers collect primary data directly from the marketplace, customers, traders and suppliers. These are reliable

data source and help in overcoming the limitation of

secondary data.

More than the 90% of marketing research involves one or the

other part of primary data search. The problem in primary

data is cost both in terms of money and time.

It can be done in following ways

Observation Research-

Focus Group Research-

Census Research

Survey Research-

Behavioral Research-

Experimental Research-


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Research ApproachesResearch Approaches

Primary Data sourcePrimary Data source Observational Research- Fresh data can be collected Observing

how customer behaves while shopping or consumer behaving

while consuming product. Closed video monitoring, hold informal

interview sessions at caf or Bar are some of the useful technique

in tracking a brand movement. Photograph can also provide detail

information to the researchers. E.g. Market Researcher meander on business class of Jet airways

to hear how travelers talk about different carriers and their

features.

Researcher for Kingfisher fly on Jet Airways flight to observe the

in-flight services.

Nokia has launch their handset with devnagri lipi.

Motorola has launch a handset on which one can write

Chinese character on the keypad.

Idea has launch language convertible concept.15


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Research ApproachesResearch Approaches

PrimaryD

ata sourcePrimaryD

ata source Survey Research-The most common research procedure is the

Survey. This is carried out opinions polls involving customers,

sales person, dealers, traders and experts. The methods are

postal, telephone, online surveys, or personal contact. e.g.

Cable TV , ICICI bank on wait time.

Behavioral Data- Customer leave their purchasing behavior in

store, scanning data, customer database.

e.g. A grocery shopping data reveal that the high-income

people dont necessarily buy more expensive brands, contrary

to what they might state in the interviews. And many low income

group people buy expensive brands.

Experimental Research- This is most scientifically valid

research design to capture cause and effect relationship .

e.g. Charging of internet services in-flight alternate weeks. 17


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Research InstrumentsResearch Instruments

There are mainly two types of Research Instrument: Questionnaire

Qualitative Measure

Technological / Mechanical Devices

A Questionnaire consist of a set of questions presented torespondent. Because of its flexibility it is by far the most

common instrument used to collect primary data.

Researchers need to carefully develop, test and debug

questionnaire before administering them on a large scale.

The form, wording, and sequence of the question can allinfluence the response.

Close-end questions and Open-end question.

Close end questions are specify all the possible answers

and provide answers that are easier to interpret and

tabulate 18


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Research InstrumentsResearch Instruments--CloseClose

end Questionsend Questions A Question with two possible answer Yes / No

A Questions with multiple choice-

A statement with which the respondent shows the amount

of agreement / disagreement

A scale connecting two bipolar e.g LargeSmall,

e.g. Experienced Inexperienced, Modern-Old fashioned

A scale that rate some attribute from excellent to poor.

An scale that rate the importance of some attribute i.e

extremely important, very important, somewhat important,Not very important, Not at all important.

A scale that describes respondent intention to buy e.g.

Definitely buy, Probably buy, Not sure, Probably not Buy,

Definitely not buy.

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Research InstrumentsResearch Instruments--QualitativeQualitative

Open end questions allow the respondent to answer in their

own words and often reveal how people think

Completely Unstructured- What is your opinion about the

quality of service by ICICI, M&M, Vodafone.

Word association-What is the first word that comes to your

mind when you hear the following 4 wheeler ------

Tata Motors---

Travel------------

Sentence Completion: e.g. When I chose a shoe the most

important consideration in my decision is _____________

Story completion-

Picture Completion with the statement-

Thematic Appreciation Test- A picture is presented and the

respondent asked to make up a story about what they think.20


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Research InstrumentsResearch Instruments--

Technological DevicesTechnological Devices Mechanical / Technological devices such as Eye camera,

Galvanometers, Audiometer are used to measure the

interest or emotions aroused by exposure to an advtg.

Eye cameras study respondents eye movement to see

which part of an ad attracted attention first and how longthey pay attention to a single item.

Audiometer can be attached to the TV set- when the set is

on and which channel is tuned is known.(TAR)

Skin sensors, Brain wave scanner to get consumerresponse.

Eye movement and Brain activity of web surfers to see

which add grab their attention.

Online Research- 21


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Sampling PlanSampling PlanAfter deciding on the Research Instrument the marketing researcher

must design and prepare a sampling plan which outlines

Who should be surveyed (Sampling Unit),

How many should be surveyed (Sampling Size)

How should they be selected for the survey (Sampling

Procedure)Sampling Unit Researcher must define the element of the target

population by whom information shall be collected. E.g.

housewife or a youth between 16-25 years or an office located at

Nariman point. It refers to a pie taken from a population. If this pie

is drawn carefully, conclusions can be define to the entirepopulation and generalization can be made.

Sampling Size Large sample provides more reliable result than

smaller samples. But normally sample size is decided based on

nature of the study and variance in population, level of accuracy

desired and above all the money available for research 22


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Sampling procedure -Two types of methods are available for selecting the samples-

Probability sampling & non probability sampling procedure

i) Probability sampling method refers to collect data where each

element has an equal chance of getting selected. Three

comonly used sampling method are Simple Randomsampling, Stratified random sampling and Cluster sampling.

e.g Researcher may decide to collect information from every

third person he meets at Mumbai VT station. This method

helps in eliminating researcher bias and any other

respondent bias which may lead to an error in conclusion.

The problem with this method is that it is not necessary that

every third person is the target customer for the firms

product and hence the responses may be in coherent and

not useful


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Non Probability Sampling methodNon Probability Sampling method--

In Non Probability method the respondents are chosen on thebasis of researchers convenience or judgment and this method

does not allow the sampling error to be measured. In spite of thismany researchers use this method due to time and cost constraint.

Three commonly used Non probability method are

i) Convenience sample- MR selects of the most accessiblepopulation members.

ii) Judgemental- Researchers selects population member who aregood for accurate information. Or decides on who meets the targetmarket s definition and then collects the data.

Many a time the researcher may have to use his judgment inselecting a respondent. e.g though he might have been asked toknock at the 2nd flat of the 2nd floor of every alternate bldg on the leftof the road, He may find that there are not enough bldgs. on the leftbut there are plenty on the right of the road, in such a case he useshis judgment and consider the purpose of the research and target

market definition, such a sample then is called a purposive.


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Contact MethodsContact MethodsNow the researcher has to decide how the respondent should be

contacted. The different methods are-

Mail Questionnaire This is the best way to reach people who

may not give personal interview. The questionnaire should be

simple and clearly worded so that respondent can fillup the

answer without any assistance. Telephone interview - interactive, very quick, should be short. In

India it is difficult as people do not like to answer to stranger.

Personal Interview face to face interaction, most versatile, it is

most expensive and also time consuming. Mall intercept methd.

Online Interview Through Internet, Inexpensive, very fast,people tend to be honest, Versatile.

Disadvantage of Online interview limited reach, samples can

be small & result can be skewed Online market research is

prone to technological problem.25


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StepStep--III Procedure of Data CollectionIII Procedure of Data CollectionAfter designing the research instrument the researcher should now

actually contact the respondent and collect information. At this stageit is very important to keep the quality of the data under control by

ensuring acurate unbiased answers.

Experimentation- Experimenting with new product ideas,

advertising copies and campaigns, sales promotion ideas, and even

pricing and distribution strategies with the target customer group.

These experiment can be conducted in an uncontrolled environment

Uncontrolled Environment Test marketing where a firm may test

its new product and marketing strategy in a market environment with

all uncontrollable elements playing their roles. Major external

elements like competition have a critical role to play

Controllable experimentationA fair/ Game is used to ask all the

question from select customer group

Survey-Opinion poll involving customer, sales person, dealers,

traders and experts, Methods are postal, telephonic, Personal survey.

Focus group- a small group (10-12)of expert discuss about the

topic.


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Tools for Data CollectionTools for Data CollectionQuestionaire used for the survey method

Steps in Questionaire design- Close endedQuestions.The questions in such a way that customer finds easy to understand

Are the Question clear to the respondents?

Is the researcher getting answer to the questions?

Are there any term or words requiring explanation?

Are there any questions which respondent feel uncomfortable with

and with not would not want to respond to?

Interview schedule- used mainly for exploratory research. The

purpose of this schedule is to study in depth an object, event or a

group of people. The limitation of an interview schedule is that it

doesnot lend itself to tabulation and generally analysis of respondentsare difficult.

Association tests- used in Qualitative research(Human behavior)

these tests are believed to reveal the customers perception of a

product, brand or firms image.


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StepStep--IV Data AnalysisIV Data AnalysisIt is important to understand that raw data has no meaning in the

marketing research. Hence appropriate tools must be used tointerpret this data. The most basic method is arithmetic analysis

using percentile and ratios.

Statistical analysis like mean, median, mode, percentage,

standard deviation and co-efficient of co relation should be used

wherever applicable.

Advanced statistical tools like test of significance, factor analysis,

Discriminate analysis, regression analysis, cluster analysis etc

can also be used only if the student has an access to a computer.

Latest technique is MDSS (Marketing Decision Support System)It helps managers to make better decisions,

MDSS is a system that consist of data collection and tools and

technique for analysis with supporting software and hardware


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StepStep--VI Make the decisionVI Make the decision The managers who commissioned the research need to

weigh the evidence. If their confidence is low then they

may decide to study further and do more research.

Organizations are using MDSS( marketing decision

support system) to help their marketing manager make

better decisions.

MDSS is coordination of collection of data, system, toolsand technique, with supporting software and hardware by

which an organization able to make marketing decisions

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Marketing Information SystemMarketing Information SystemMarketing department need to develop Marketing Information

Systems that provide them information about buyer wants, behavior,

preferences, and also about competition.

MIS is a set of procedure to collect, analyze, and distribute accurate

prompt and appropriate information to different levels of marketing

decision makers.

Philips Kotler defines MIS as a system that consists of people,equipment and procedure to gather, sort, analyze, evaluate and

distribute needed timely and accurate information to marketing

decisions makers.

Characteristics of MIS :-

Planned system to facilitate the continuous flow of info.

Provide to the point info. collected from internal & external source

Provides right info. at the right time to the right person

Continously monitors Mkt. Env. both inside & outside of Org.


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Marketing Information SystemMarketing Information SystemCompanies organize the database such as customer database

product database and field sales data combined them to be

stored in a huge database called Data Warehousing

It consists of a set of programs that extract data from

operational point of view like Sales call, Branch & Regional

performance, customer complaints, service call, brand

movement etc.

The process of searching information in data warehousing that

guide decision making is called Data Mining. Info / knowledge

extraction to get an idea about neglected customer segment,

recent customer trends and other useful information.

e.g. ICICI track the customer ways of banking with it. Whetherat ATM, bank branches or Online banking helps to design their

marketing strategy.

Data mining & CRM allows user to analyze large database to

solve business decision problem. Latest Trend Online Data

Mining & Web Mining.


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Benefits of Marketing Information SystemBenefits of Marketing Information System

Allows Marketing Manager to analyze, plan, implement and

control responsibilities more effectively.

Ensures effective tapping of marketing opportunities and enables

the company to develop effective safeguard against emerging

marketing threats.

Provides marketing intelligence to the firm and helps in early

spotting of changing trends.

Helps the firm to come up with the product and services to the

needs and tastes of the customer.

MIS helps in improving the quality of decision making.

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Types of Marketing informationTypes of Marketing information

Recurrent information- if the data that MIS provides periodically

at weekly, monthly, quarterly, or annual interval. Data such assales, Mkt. share, sales call reports, inventory levels, payables

and receivables etc

Monitoring Information-is the data obtained from regular

scanning of certain sources such as trade journals and otherpublication. Here the external environment is captured to

monitor changes and trend related to mktg. situation. E.g. data

about the competitor, data purchased from com. Source such

as MR agencies and Govt. sources.

Customized Information- is developed in response to some

specific requirement related to a mktg. problem or any particular

prob. Requested by the manager. E.g. info reqd. rgd. The

target customer for the dev. Of new product to be launch. MR

Study process. 34


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Component of MISComponent of MIS

Internal Recording System, Marketing intelligence, MR, AMS.

a) Order generation, processing, delivery and payment cycle

b) Sales management information- giving details of firms sale,

market share, profitability, and trends in each market.

c) Payment history

d) Order lost / won

e) Brand monitor

f) Distribution audit reports

g) Service monitor reports h) Products performance report

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3.1Marketing Research & MIS

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