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Transcript of Lecture 1
AD 446 Marketing Research-The Nielsen
CompanyFall 2012-13
Özlem HESAPÇI (office:IB 514) [email protected]
Analysis...Synthesis...All punished!Either exiled or executed
Socrates (470-399 BC)The Greek philosopher. His students included Plato and Aristotle
Plato (428-347 BC)The Greek philosopher He believed that a philosophical compartment toward life would lead one to being just and ultimately happy
Aristotle (384-322 BC)The Greek philosopher and tutor to Alexander the Great.
Nicolas Copernicus (1473-1543)A Polish astronomer, proposed the heliocentric model that all the planets, including the earth orbited the sun.
Galileo Galilei (1564-1642)The Italian mathematician, constructed the first telescope and confirmed Copernicus’s view of universe.
Are you aware that we are all surrounded
by researches?
Consider Relevant Information
“The truly successful managers and leaders of the [twenty-first]
century will…be characterized not by how they can access
information, but how they can access the most relevant
information and differentiate it from the exponentially
multiplying masses of non-relevant information.”
P.Drucker
Department Store
“One day I received a phone call from a research analyst.
He was working for a department store chain and wanted help analyzing the data he had collected while conducting a marketing research study”.
What is the problem?
I found that much of the data collected was not relevant to the problem. The whole study was a waste of resources. A new study had to be designed and implemented to address the problem defined.
Then
?
WHAT IS RESEARCH?
Process of
organized, systematic, controlled, empirical, critical
investigation into a specific problem with the objective of finding answers or solutions
Characteristics of Research Methodology
1. Research requires a specific plan of action (or procedures)
2. Research originates with a question – problem
3. Research is guided by the research question(s) and often by hypotheses
4. Research usually divides the principal problem into more manageable subproblems.
5. Research demands a clear articulation of a goal
6. Research is based on facts called data
7. Research requires measurable data in attempting to resolve the problem initiated by the research.
HALLMARKS of SCIENTIFIC RESEARCH
Purposiveness: having a definite aim and purpose
Testability: applicability of testing methods
Replicability: consistent findings when repeated
Precision and Confidence: closeness to reality and probability of being correct
Generalizability: scope of applicability in different settings
Parsimony: Simplicity in explaining
Research Expenditures
Delay of Marketing Decision
Possible Disclosure of Information to Rivals
Possible Erroneous Research Results
Lack of resources to conduct quality research
Research findings cannot be implemented
Research objectives are unclear
Research question cannot be answered
Knowledge already exists
Decision has already been made
Decreased Certainity
Increased Likelihood of a Correct Decision
Improved Market Performance and Resulting Higher Profits
VALUE
COST
WHAT IS THE “VALUE” ofRESEARCH?
The difference between expected value with informationand expected value without information
WHEN TO CONDUCT RESEARCH ?
In general, research should be conducted only when the benefits exceed the costs!
Determining When to Conduct Marketing Research
Is sufficient time available before
a managerial decision must be made?
Is the information already on handinadequate for
makingthe decision?
Is the decision of considerable
strategicor tactical
importance?
Does the value of the
research informationexceed
the cost ofconducting research?
ConductMarketingResearch
Do Not Conduct Marketing Research
Time Constraints Availability of Data Nature of the Decision Benefits vs. Costs
Yes YesYesYes
No No No No
RESEARCH IS LIKE INSURANCE!
Both involve paying a fee to reduce risk...
Neither one prevents disaster!
TYPES OF RESEARCH
"Basic research "seeks to expand our knowledge of
fundamental relationships, with no specific application in mind.
"Applied research" seeks to address a specific, immediate
problem.
Most research conducted in the market is applied!
Research
Problem Identification Research
Problem Solving Research
Market Potential ResearchMarket Share Research
Market Characteristics ResearchSales Analysis Research
Forecasting ResearchTrends Research
Segmentation Research
Product Research
Promotion Research
Distribution Research
Pricing Research
PRODUCT RESEARCH
Test concept
Determine optimal product design
Test marketing
Package tests
Product modification
Brand positioning and repositioning
SEGMENTATION RESEARCHDetermine the basis of segmentationCreate lifestyle, demography, media usage profilesEstablish market potential and responsiveness for various segmentsSelect target markets
PRICING RESEARCH
Pricing policies
Product line pricing
Price elasticity of demand
Initiating and responding to price changes
PROMOTIONAL RESEARCH
Optimal promotional budget
Optimal promotional mix
Copy decisions
Media decisions
Creative advertising testing
Evaluation of advertising effectiveness
DISTRIBUTION RESEARCH
Determine…
Types of distribution channel
Location of retail and wholesale outlets
Attitudes of channel members
RESEARCH PROCESS
1- Establish a need for information 2- Specify Research Objectives, Decision Problems , Research Problems3- Specify Information Needs and the Associated Research Design4- Determine Sources of Data5- Develop Data Collection Forms 6- Design the Sample 7- Collect, Process, and Analyse the Data 8- Present the Results
RESEARCH PROCESS1-Establish a need for information
What is the purpose of the study?to identify a problem / opportunity?
to solve a problem?
What information is needed to make the decision?
Should research be conducted?
Intuition-Centered Decision Making
Research-CenteredDecision Making
Continuum of Marketing Research Sophistication
CHARACTERISTICS OF VALUABLE INFORMATION
CHARACTERISTICS OF VALUABLE INFORMATION
REDUCES UNCERTAINTY HELPS FOCUS DECISION MAKING
RELEVANCE
QUALITY
TIMELINESS
COMPLETENESS
RESEARCH PROCESS
1- Establish a need for information 2- Specify Research Objectives, Decision Problems , Research Problems3- Specify Information Needs and the Associated Research Design4- Determine Sources of Data 5- Develop Data Collection Forms 6- Design the Sample 7- Collect, Process, and Analyse the Data 8- Present the Results
2-Specify Research Objectives, Decision Problems , Research Problems
A problem simply indicate an interest in an issue where finding the right answers might help to improve situations.
It does not necessarily mean that something is seriously wrong with a current situation!
“The formulation of the problem is
often more essential than its solution”
Albert Einstein
PROBLEM DEFINITION
Before defining the problem you should be able to answer the following questions:
What is the purpose of the research?How much is already known?Is additional background information necessary?What is to be measured ? How?Can the data be made available?Can a hypothesis be formulated?
The problem statement should be expressed as a problem--a matter of doubt, difficulty, or dissatisfaction the answer or solution to which is not immediately evident.
The problem should be stated in a way that convinces the researcher that its solution will leave the world a better place in which to live.
The statement of the problem should clearly describe the problem that will be addressed by the proposed study
It should be clear as to what is included in the problem and what is not included in the problem.
The Problem Statement
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.
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.
.
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Decision Problem vs.
Research Problem
Should the advertising campaign
be changed
Should a new product be
introduced?
To determine the effectiveness of the
current advertising campaign
To determine consumer preferences
and atitudes for the proposed
new product
Proper Definition of the Research Problem
Research Problem
Broad Statement
Specific Components
Look at the migros case in
1st lecture!
RESEARCH PROCESS
1- Establish a need for information 2- Specify Research Objectives, Decision Problems , Research Problems3- Specify Information Needs and the Associated Research Design4- Determine Sources of Data 5- Develop Data Collection Forms 6- Design the Sample 7- Collect, Process, and Analyse the Data 8- Present the Results
TYPES of DATA
Secondary Data
Primary Data
SECONDARY DATA
HISTORICAL ALREADY ASSEMBLED NEEDS NO ACCESS TO SUBJECTS
Classification of Secondary Data
Secondary Data
Ready to Use
Requires Further
Processing
PublishedMaterialsLiterature
Computerized Databases
Syndicated Services
Internal External
INTERNAL DATA as Secondary Source
ACCOUNTING INFORMATION SALES INFORMATION BACKORDERS CUSTOMER COMPLAINTS DATA WAREHOUSE
etc...
EXTERNAL DATA as Secondary Source
CREATED, RECORDED, OR GENERATED BY AN ENTITY OTHER THAN THE RESEARCHER’S ORGANIZATION
Published/Online Secondary Data –How to find?
Books, journals( published – online)
bookstores, libraries, e bookshttp://www.ideefixe.com/vitrin/default.asphttp://www.amazon.com http://library.bilgi.edu.tr/http://www.mediacatonline.comhttp://www.marketingturkiye.com
Census (Government Statistical Instititute – TUIK)http://www.tuik.gov.tr/http://www.worldbank.org/data/
Chambers of Commerce http://www.tr-ito.com/ITOPortal/mainIE.html
Directories of Trade Associationshttp://www.arastirmacilar.org/http://www.rv.org.tr/http://www.rd.org.tr/
Databaseshttp://globaledge.msu.edu/ibrd/ibrd.asp
National - local newspapers
http://radikal.com.trhttp://milliyet.com.tr
International newspapers http://www.washingtonpost.com/http://www.nytimes.com/ etc........
Evaluating Secondary DataEvaluating Secondary Data
Does the data help to answer questions
set out in the problem definition?
Does the data apply tothe time period of
interest?
Does the data apply tothe population of
interest?
Applicabilityto projectobjectives
Do the other terms and variable
classifications presented apply?
Are the units ofmeasurement comparable?
If possible, go to the original source of the
data?
Evaluating Secondary Data (continued)Evaluating Secondary Data (continued)
Applicabilityto projectobjectives
Accuracy & costof the data
Is the cost of dataacquisition worth it?
Accuracyof the data
Is there a possibility of bias?
Can the accuracy of data collection
be verified?
Evaluating Secondary Data (continued)Evaluating Secondary Data (continued)
STRENGTHS of
SECONDARY DATA (vs. primary)
cheaper
available quickly
easy to obtain
Possible Disadvantages
ofSECONDARY DATA
it may be:
Not Available; no prior study on this topic
Not Relevant; data may not fit current study different units of measurement different class boundaries or summarization out of date
Not Accurate; data may simply be wrong
COMMON RESEARCH OBJECTIVES FOR COMMON RESEARCH OBJECTIVES FOR SECONDARY DATA STUDIESSECONDARY DATA STUDIES
Fact Finding - Identifying consumption patterns- Tracking trends
Model building - Estimating market potential- Forecasting sales- Selecting trade areas and sites
Data Base Marketing - Development of Prospect Lists - Enhancement of Customer Lists
Literature survey!
Why Literature Survey is conducted?
In order not to ignore the important variables related with the problem concerned
Testability and replicability of the findings of the current research is enhanced.
Avoid the risk of “reinventing the wheel”
Significancy and relevancy of the problem investigated is revealed to the scientific community.
What variables to consider (parsinomy), why they are important. This helps to construct theoretical framework and develop the hypothesis for testing.
How to make use of Literature Survey?
Theoryvariable- hypothesis
Theory is a set of (network of) general propositions used to explain the relationships among certain phenomena
Theoryvariable- hypothesis
Hypothesis is a proposition that is empirically testable.
Empirical means that something is verifiable by research.
Theoryvariable- hypothesis
You need variables for stating propositions and then developing theories. A variable (or construct) is:generalized idea about a class of objects, attributes, occurrences, processes, behavior, attitude
eg; Package design, quality, brand image, taste of a product, school failure, achievement, inflation, strike, internet usage, reinforcement, productivity, aggressiveness, conformity, honesty, anxiety, brand equity
VARIABLE
A variable is anything that can take on differing, varying values
For.ex- exam score: from ‘0’ to ‘100’
For.ex- motivation: from ‘not at all’ to ‘very high motivation’
Exercise
Decision Problem: Develop a social environment for Bilgi Students
Research Problem: Analyse Life Styles
Variable / LS: AIO (Activities, Interests, Opinions) I like a lot of variety in my life.
Mostly disagree Somewhat disagree Somewhat agree Mostly agree
I follow the latest trends and fashions.Mostly disagree Somewhat disagree Somewhat agree Mostly agree
I often crave excitement.Mostly disagree Somewhat disagree Somewhat agree Mostly agree
Hypothesis: Class Level, Gender, Faculty, Department ~ AIO
TYPES of VARIABLES
Dependent VariableIndependent VariableMediating VariableIntervening Variable
DEPENDENT VARIABLE
It is the primary interest of the researcher.
The researcher’s goal is to explain the variability in the dependent variable.
DEPENDENT VARIABLEExample
A manager is concerned that the sales of a new product launched is not as high as expected.
The dependent variable is sales.
INDEPENDENT VARIABLE
It is the one that influences the dependent variable in either a positive or a negative way
INDEPENDENT VARIABLEExample
Dependent variable sales
Independent variable(s) IMC budget price of product package design of product etc....
MEDIATING VARIABLE
Presence of a third variable modifies the originally expected relationship between the dependent and independent variables
MEDIATING VARIABLEExample
Dependent variable sales
Independent variable(s) IMC budget
Mediating variable media used for advertisement
INTERVENING VARIABLE
It is one that surfaces between the time the independent variables operate to influence the dependent variable and their impact on the dependent variable
INTERVENING VARIABLEExample
Dependent variable sales
Independent variable(s) IMC budget
Mediating variable media used for advertisement
Intervening variable public reaction to the newly announced pollution created by the production process of the product
HYPOTHESIS DEVELOPMENT
Once the variables are identified, a logical reasoning must be done about the relationship among variables. And then this relation must be tested scientifically.
Formulating such testable statements is called hypothesis development
HYPOTHESIS DEVELOPMENT Example
H: There is no significant relationship between the imc budget spent for launching the new product and its sales
Exercise Solution
Dependent Dependent Variable:Variable:
sales sales
IndependenIndependent t
Variable(s):Variable(s):• IMC budget• price of product• package design of product
Mediating Mediating Variable:Variable: Media for Media for
advertisementadvertisement
Intervening Variable: Intervening Variable: public reaction to the newly announced pollution created by the production process of the product
EXERCISE
A soft drink firm will launch a new brand of beverage in two years time.
In a short time they plan to capture a significant portion of the market and they wonder about the factors of brand loyalty in soft drinks market.
Decision Problem: whether to launch a new brand of beverage.
Research Problem: the factors of brand loyalty in soft drinks market.
The research company finds out through the literature that taste, package design, price and availibility are the factors that increase loyalty.
And they also read in the literature that “recommendation of friends- word of mouth-” strengthens this relation.
VARIABLES
INDEPENDENT VARIABLES
-Taste
-package design
- price
-availibility
DEPENDENT VARIABLE
Loyalty to soft drinks
MEDIATING VARIABLE
WOM
Hypothesis
There is a significant relationship between loyalty to soft drinks and package design
There is a significant relationship between loyalty to soft drinks and price There is a significant relationship between loyalty to soft drinks and taste
There is a significant relationship between loyalty to soft drinks and availibility
There is a significant relationship between loyalty to soft drinks and WOM
EXERCISE 2
A Cosmetic Company wants to start a PR campaign in one month time. A celebrity woman will make testimonials with different products of the firm and will make speeches. To make sure of the effectiveness of the campaign they want to frame the content of speeches.
So company aims to learn the most important points to convince the customers prefer their brand.
Decision Problem: whether to start a PR campaign
Research Problem: the points of brand preference in cosmetic sector.
The research company finds out through the literature that easy pronounciation of brand name, price, fragrance and color of package
are the factors that influence brand preference.
And they also read in the literature that, education level of consumers, affect the priority of factors.
Besides the attractivenessof celebrity has high impact
VARIABLES
INDEPENDENT VARIABLES
•Easy pronunciation of brand name
•Price•Fragrance
•Color of pack
DEPENDENT VARIABLE
Brand preference in cosmetics
MEDIATING VARIABLE
Education
MEDIATING VARIABLE
Attractiveness of celebrity
INDEPENDENT VARIABLE(s)
-Demographic variables -Location of internet usage -# of hours/ week spent over Internet-Reason of Internet use-Other media consumption
MEDIATING VARIABLE
Gratification of internet use
DEPENDENT VARIABLE
Internet Addiction
EXERCISE
INDEPENDENT VARIABLE(s)
MEDIATING VARIABLE
DEPENDENT VARIABLE
Attitudes Towards an Ad
EXERCISE
Ruling out chance as an explanation
When a variable appears to have an effect on another variable, it is very important to be able to state with confidence that the effect was really due to the variable and not just due to chance.
RESEARCH PROCESS
1- Establish a need for information 2- Specify Research Objectives, Decision Problems , Research Problems3- Specify Information Needs and the Associated Research Design4- Determine Sources of Data 5- Develop Data Collection Forms 6- Design the Sample 7- Collect, Process, and Analyse the Data 8- Present the Results
Research Design: Definition
A research design is a framework or blueprint for conducting the research project.
It details the procedures necessary for obtaining the information needed to structure or solve research problems.
CRITERIA FOR SELECTING the RESEARCH DESIGN
What is the reason of the research? To what extent the result will affect your decision? Will it be used for a critical decision? (eg.like investment decision)What is the required degree of precision and confidence?Extent of generalization required. Is there sufficient time available for such a research?What is the budget allocated for the research?
A Classification of Research Designs
Research Design
Conclusive Research Design
Exploratory Research Design
Descriptive Research
Causal Research
EXPLORATORY RESEARCHwhen we don't know what is happening?
DESCRIPTIVE RESEARCHto learn about what is happening
CAUSAL RESEARCHto learn why something is happening
....
a given research project may contain elements of all three types of research designs !
Along with research design, the research process must be designed
setting, location for the study, unit of analysis, time horizon
SETTING & LOCATION
Natural setting; where events normally occurContrived setting; artificial
And the location specifically?
Unit of analysis
IndividualsDyadsGroupsOrganisationsCultures
TIME HORIZON
Cross Sectional
Longitudinal