Marketing Research6
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Transcript of Marketing Research6
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Classification of Marketing Research
Product Research Pricing Research
Advertising Research
Motivation Research
Sales Research
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Product Research
Component of market research whereby the characteristic of a good or service,
that will satisfy a recognized need or want, are identified. Developing anddesigning great products are keys to success in business. Anything less than an
excellent product strategy can be destructive to a firm. Top companies' focus on
few products and concentrate on maintaining a high level of quality for those
products to maximize the potential for success. For instance Honda's focus is
engines. Virtually all of Honda's sales e.g. autos, motorcycles, generators, lawn
mowers, are based on its excellent engine technology. Likewise, Intel's focus ison computer chips, while Microsoft's is on PC software.
However, most products have a limited and even predictable life cycle and
companies must be constantly looking for new products to design, develop and
take to market. Good operations managers insist upon strong communication
between customer, product, processes, and suppliers that results in a high
success rate for their new products. One product strategy is to build particularcompetence in customizing goods or services. This approach allows the
customer to choose product variations while reinforcing the organization'sstrength.
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Dell Computers, for example, has built a huge market by delivering computers with
the exact hardware and software desires by the end user. And Dell does it fast - it
understands that speed to market is imperative to gain a competitive edge. Many
service firms also refer their offerings as products. So while the term products mayoften refer to tangible goods, it also refers to offerings by service organizations. An
effective product strategy links product decisions with investment, market share,
product life cycle, and breadth of the product line.
The objective of the product decision is to develop and implement a product strategy
that meets the demands of the market place with a competitive advantage.
Goods and services selection is very important. How management selects those?
Marketers see product research as the first stage in Product Life Cycle Management.
Product research is a business and engineering term which describes the complete
process of bringing a new product to market. There are two parallel aspects to this
process:
1. Product engineering.2. Marketing analysis.
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Many organizations have product research methodologies that provide a standard framework
for planning and managing development efforts. If your organization doesn't have one, you
should consider using something like this one.
There are several stages in the product research process: -
Idea GenerationThe ideas for new products obtained from customers, R&D department, competitors, focus
groups, employees, or trade shows. The formal idea generating techniques include attribute
listing, forced relationships, brainstorming, morphological analysis, problem analysis and early,
rapid prototyping.
Idea Screening
This involves eliminating unsound concepts. One must ask three questions:1. Will the target market benefit from the product ?
2. Is it technically feasible to manufacture the product?
3. Will the product be profitable ?
Concept Development and Testing
This step includes developing the marketing and engineering details:1. Who is the target market ?
2. What benefits will the product provide ?
3. How will consumers react to the product ?
4. How will the product be produced ?
5. What will it cost to produce it ?
One should also test the concept by asking a sample of prospective customers what they think
of the idea.
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Pricing ResearchPricing research has been proven to be highly valuable in helping many
companies determine when the price is right. And when the price is
right, profit soars. Virtually all pricing research designs fall into one ofessentially three types: monadic measurement, comparativemeasurement, and declarative measurement.
Monadic Measurement- Each respondent reacts to one, and only one,
price point.
Comparative Measurement- Each respondent reacts to two or more
price points
Declarative Measurement- Each respondent volunteers a maximum (or
acceptable)price.
Pricing research will help you understand what your customers are
willing to pay up front, and you can make more profit table design
decisions.
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Monadic measurement is, however, a statistical luxury. It requires a larger sample
and thus, a larger budget. And where the universe of decision-
makers is relatively small, monadic designs are, frankly, not an option, even where
money is no object. Because monadic samples tend to be smaller, the result is an
increase in the sampling error around our estimates and reduction in statistical
reliability. In fact, monadic designs can produce what look like irrational price
curves because of slight response variations across groups that are attributable to
sampling error.
In monadic designs, each respondent is exposed to one, and only one, price point
for any given product. In comparative designs, each respondent is asked to react totwo or more prices. And in declarative designs, each respondent is asked (for one or
more than one product) to volunteer his or her own price --one that is maximum
and/or reasonable, acceptable, etc. Note that comparative testing is not to be
confused with a design that asks customers to choose between Product A at one
price and Product B at another.
The following are the price testing techniques to cater to the specific needs.
Gabor Granger
Customers are asked if they would buy a product at a particular price. The
respondents are exposed to the price in a randomized manner and are again asked
if they would buy or not. The technique helps understand the price elasticity for the
product by working out what levels of demand would be expected at each pricepoint price .
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Sensitivity Monitor (PSM)This technique helps one identify the acceptable range
of prices in the minds of the consumer and determine whether the price is set too
low (creating suspicion about quality) or too high (offering poor value for money).
Conjoint Analysis
Conjoint Analysis is a technique that allows one to understand how people make
trade-offs between different products and services and the values they place on
different features. By understanding precisely how people make decisions and
what they value in a product or service, one can work out the optimum level of
features (including price) and services that balance value to the customer against
cost to the company.
Brand Price Trade-Off (BPTO)
BPTO is a variation of the Conjoint Technique, where several brands are shown atonce and the customer chooses the preferred option. The BPTO determines the
impact of price increases and decreases on the sales of the brand. It is also
capable of providing the response to competitors' changes in price and provides
an analysis of gains and losses. The BPTO technique also helps in understanding
how much premium a brand can charge.
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Motivation Research
Motivational research is a type of marketing research that attempts to explain why
consumers behave as they do. The application of the knowledge and techniques
of the social sciences, especially psychology and sociology, to understandingconsumer attitudes and behavior: used as a guide in advertising and marketing.Motivational research seeks to discover and comprehend what consumers do not
fully understand about themselves. Implicitly, motivational research assumes the
existence of underlying or unconscious motives that influence consumer behavior.
Motivational research attempts to identify forces and influences that consumers
may not be aware of (e.g., cultural factors, sociological forces).
Typically, these unconscious motives (or beyond-awareness reasons) are
intertwined with and complicated by conscious motives, cultural biases, economic
variables, and fashion trends (broadly defined).
Motivational research attempts to sift through all of these influences and factors to
unravel the mystery of consumer behavior as it relates to a specific product orservice, so that the marketer better understands the target audience and how to
influence that audience.
Motivational research is most valuable when powerful underlying motives are
suspected of exerting influence upon consumer behavior. Products and services
that relate, or might relate, to attraction of the opposite sex, to personal adornment,
to status or self-esteem, to power, to death, to fears, or to social taboos are alllikely candidates for motivational research.
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For example, why do women tend to increase their expenditures on clothing and
personal adornment products as they approach the age of 50 to 55? The
reasons relate to the loss ofyouths beauty and the loss of fertility, and to related
fears of losing their husbands' love. It is also a time of life when discretionary
incomes are rising (the children are leaving the nest).
Other motives are at work as well (women are complicated creatures), but a
standard marketing research survey would never reveal these motives, because
most women are not really aware of why their interest in expensive adornments
increases at this particular point in their lives.
Even benign, or low-involvement, product categories can often benefit from the
insights provided by motivational research. Typically, in low-involvement product
categories, perception variables and cultural influences are most important. Our
culture is a system of rules and regulations that simplify and optimize our
existence.
Cultural rules govern how we squeeze a tube of toothpaste, how we open
packages, how we use a bath towel, who does what work, etc. Most of us are
relatively unaware of these cultural rules. Understanding how these cultural rules
influence a particular product can be extremely valuable information for the
marketer.
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The three major motivational research techniques are observation, focus groups,
and depth interviews. Observation can be a fruitful method of deriving
hypotheses about human motives. Anthropologists have pioneered the
development of this technique. All of us are familiar with anthropologists living
with the natives to understand their behavior. This same systematic observationcan produce equally insightful results about consumer behavior.
Observation can be accomplished in-person or sometimes through the
convenience of video. Usually, personal observation is simply too expensive, and
most consumers dont want an anthropologist living in their household for a
month or two.It is easier to observe consumers in buying situations than in their homes, and
here the observation can be in-person or by video cameras. Generally, video
cameras are less intrusive than an in-person observer.
Finding a representative set of cooperative stores, however, is not an easy task,
and the installation and maintenance of video cameras is not without its
difficulties. In-store observers can be used as well, so long as they have somecover that makes their presence less obvious. But, observation by video or
human eye cannot answer every question. Generally, observation must be
supplemented by focus groups or depth interviews to fully understand why
consumers are doing what they do.
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The Focus Group
The focus group in the hands of a skilled moderator can be a valuable
motivational research technique. To reach its full motivational potential, the
group interview must be largely nondirective in style, and the group must
achieve spontaneous interaction. It is the mutual reinforcement within the group
(the group excitement and spontaneity) that produces the revelations and
behaviors that reveal underlying motives. A focus group discussion dominated by
the moderator will rarely produce any motivational insights. A focus group
actively led by the moderator with much direct questioning of respondents willseldom yield motivational understanding. But the focus group is a legitimate
motivational technique.
The Depth Interview
The heart and soul of motivational research is the depth interview, a lengthy (oneto two hours), one-on-one, personal interview, conducted directly by the
motivational researcher. Much of the power of the depth interview is dependent
upon the insight, sensitivity, and skill of the motivational researcher. The
interviewing task cannot be delegated to traditional marketing research
interviewerswho have no training in motivational techniques
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Advertising Research
This type of research allows companies and advertising agencies to evaluate
many advertising creative concepts at different stages before production in order
to identify a winning concept and prevent the investment of many man-hours andproduction resources in ineffective advertisements.
This kind of research can also be used at the early stages of Web site
development when the concept of the graphic design for the home page is
emerging.
Benefits of Advertising Research
Asses an ads ability to create awareness, generate leads, and increase
conversion
Measure how effective different ads are at drawing attention, build brand image,
elicit emotion, communicate a message, etc.
Pinpoint weak elements within an ad and how to improve its performance
Identify elements that can be part of an integrated ad campaign using differentmedia
Provide a framework for the creative/design team, allowing them to create
effective ads
Allow to explore different creative concepts before production
Indicate which creative elements and content appeal to different target segments
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Need for Advertising Research
The role of research in advertising can be seen in various stages of
advertising planning. First what should be the objectives of advertising.
Research would enable the company to be clear in its objectives of
advertising. Second advertising research should be used for developing
a strategy for marketing the product in question.
The selection of the target audience can be facilitated by advertising
research. Another aspect where research can be useful is the selection
of message that an advertisement should carry and through what media
it should be conveyed.
Research has to concern itself with the evaluation of advertising in order
to find out whether the expenditure on advertising has been justified or
not.
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We combine qualitative and quantitative research methods to capture
brand awareness, advertising awareness, brand recognition, slogan
recognition, brand image, unaided and aided message recall, brand
purchase behavior, media usage, and the impact of design and graphic
elements when appropriate.
When several creative concepts are tested we can identify not only the
most preferred ad, but also the one with the greatest potential to capture
the audiences attention in a crowded media environment. It is called an
adsshock value.
An advertising research study dealing with Santoor a brand of toilet soap
was done by Ravi Menon and Ashotosh Sinha. Simulated Test Marketing
(STM) methods were used to choose between two alternative advertising .
Santoor was launched in 1986. In early 1989 a relaunch of the brand was
being contemplated.
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The advertising agency Ulka came up with two alternative appeals for
advertising:
Young Skin: to have youthful skin. Three alternative ads the were developed for
the youngskin concept. Of the three alternative ads foryoungskin, one ad(i.e.
bookshop) was found most appealing.
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Sales Research
Analysis of actual sales results. Sales research enables a company to
identify the areas where its sales performance has been good ormediocre, customers who have bought in bulk, products with high and
low sales volume etc. A systematic comprehensive periodic sales
analysis will be helpful to a company to reinforce its sales effort where it
is most needed.
Sales Research by Product
Sales Research by Customers
Sales Research by size of Order
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Future of Market Research in India
The market research industry is 35 years old and its turnover is
about Rs 325 crore. In the last few years, the market has beengrowing at about 10%. However, with the liberalization of more
industry sectors, this growth rate will accelerate. Market
research in India has been focused more on fast movingconsumer goods (FMCG) and consumer behavior. There has
been growth beyond the traditional FMCG research (though it stillaccounts for the big chunk of research expenditure). In my view,
outside of the traditional packaged-goods business, the most
significant growth area for the market research industry in India
in the last few years is the media measurement business. Next
would be auto, telecom and healthcare sectors that have started
spending much more on market research in recent times. The
durable industry is also increasing spend. Lastly, customer
satisfaction in all industry sectors is a growing segment for
market research.
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India is falling behind is in the area of use of technology for data
collection. That is because most of the technologies used for data
collection in the advanced world today are internet and telephone
based. With low internet penetration and teledensity we have no choicebut to continue to do face-to-face interviewing along with paper and
pencil method of data collection.
The market research in India is having a bright prospect because of the
competition among the marketers and manufacturers. There are a lot of
companies coming in India to establish a business because of the huge
potential in Indian market due to its consumption theory. So there are
more requirements of Healthcare Research Services in India in coming
days. But the future of the market research could restrict on the
databases and social media. Most of the companies are today
demanding for the databases of the target customers so that they
directly approach them.Growth rate of Smart phones and Tablets Smart phones and Tablets
will be used in greater proportion than desktop devices by consumers
in 2013.
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Direct consumer communications and advertising via mobile devices will
continue to grow rapidly and will often utilize social media and location-based
services. High-margin revenue generation will occur in this segment of themarketing industry because of huge demand upon consumer engagement, and
for market research.
Growth rate in market research industry in India - Quantitative Research in India
and Secondary Research Services in India can witness a growth rate of more
than 12% in 2013, irrespective of global recession.