Steps of Marketing Research

1. Identifying and formulating the problem/opportunity,

2. Planning the research design and gathering primary data,
3. Specifying the sampling procedures,
4. Collecting the data,
5. Analyzing the data,
6. Preparing and presenting the report, and
7. Following up
 Marketing research serves marketing management by providing information which is relevant
to decision making. Marketing research does not itself make the decisions, nor does it
guarantee success. Rather, marketing research helps to reduce the uncertainty surrounding
the decisions to be made.
Marketing decisions include promotion decisions which are important content of
the marketing mix in which different aspects of marketing communication occurs. The
information about the product is communicated with an objective to produce positive customer
response.
Here is why your company should conduct business market research: Identify the problem areas
in your business. Understand the needs of existing customers and why they chose your service
over competitors. ... Make well-informed market decisions about your services and develop
effective strategies.
Importance of Conducting Effective Research Leading to Good Decision Making. ... The
primary role of a management comprises of undertaking proper and effectivedecisions. A lack of
proper research and analysis about the existing as well as future situations could lead to
ineffective decision-making by the management.
Research is important for any organization to remain competitive in the market. The top function
of research is to supply a business with an outlet to correctly determine its customers. With the
help of surveys, an organization can analyze the preferences of its target consumers.
Consumer research was also used to measure product effectiveness versus competitors’ Products.

The marketing research problem is information oriented. It involves determining what information is needed
and how that information can be obtained efficiently and effectively. The marketing research objective, then,
is to provide insightful decision-making information. This requires specific pieces of information needed to
answer the marketing research problem. Managers must combine this information with their own
experience and other information to make a proper decision.

Whereas the marketing research problem is information oriented, the management decision problem is action
oriented. Management problems tend to be much broader in scope and far more general than marketing
research problems, which must be narrowly defined and specific if the research effort is to be successful.

Used to support business decisions, market research is used to identify the need for new
products and services. ... It can also help rejuvenate a product brand. Market research is used
to discover effective ways to protect consumers and identifies ways to offer more efficient and
customer-friendly services.

Marketing research also helps managers understand what is going on in the marketplace and take
advantage of opportunities.

A well-designed market research survey can help you determine whether you
need to:
1. Enter a new market.
2. Launch a new product or service.
3. Promote brand awareness.
4. Optimize your marketing campaign.
5. Improve customer service.
6. Change messaging perception of your product or service.
7. Adjust price points.

Secondary Data
A valuable tool throughout the research process, but particularly in the problem/opportunity identification
stage is secondary data—data previously collected for any purpose other than the one at hand. Secondary
information originating within the company includes documents such as annual reports, reports to
stockholders, product testing results perhaps made available to the news media, and house periodicals
composed by the company’s personnel for communication to employees, customers, or others. Often this
information is incorporated into a company’s internal database.

Secondary data can pinpoint the kinds of people to approach and their locations and serve as a basis of
comparison for other data. The disadvantages of secondary data stem mainly from a mismatch between
the researcher’s unique problem and the purpose for which the secondary data were originally gathered,
which are typically different.

The quality of secondary data may also pose a problem. Often, secondary data sources do not give
detailed information that would enable a researcher to assess their quality or relevance. Whenever
possible, a researcher needs to address these important questions: Who gathered the data? Why were
the data obtained? What methodology was used? How were classifications (such as heavy users versus
light users) developed and defined? When was the information gathered?

DSS in Marketing

Marketing decisions include promotion decisions which are important content of

the marketing mix in which different aspects of marketing communication occurs. The
information about the product is communicated with an objective to produce positive customer
response.

An analytical marketing plan begins by gaining insight into a business' customers.

Analytical strategists need to decide what they want to know from customers, manage and
organize the data, and create customer profiles to gain insight. Companies can then predict
consumers' behavior from their data.

A decision support system (DSS) is a computerized information system used tosupport

decision-making in an organization or a business. A DSS lets users sift through and analyze
massive reams of data and compile information that can be used to solve problems and make
better decisions.

In general, the decision making process helps managers and other business
professionals solve problems by examining alternative choices and deciding on the best
route to take. Using a step-by-step approach is an efficient way to make thoughtful,
informed decisions that have a positive impact on your organization’s short- and long-
term goals.
The business decision making process is commonly divided into seven steps. Managers
may utilize many of these steps without realizing it, but gaining a clearer understanding
of best practices can improve the effectiveness of your decisions.

Steps of the Decision Making Process

The following are the seven key steps of the decision making process.

 Identify the decision. The first step in making the right decision is recognizing
the problem or opportunity and deciding to address it. Determine why this
decision will make a difference to your customers or fellow employees.

 Gather information. Next, it’s time to gather information so that you can make a
decision based on facts and data. This requires making a value judgment,
determining what information is relevant to the decision at hand, along with how
you can get it. Ask yourself what you need to know in order to make the right
decision, then actively seek out anyone who needs to be involved.

 Identify alternatives. Once you have a clear understanding of the issue, it’s time
to identify the various solutions at your disposal. It’s likely that you have many
different options when it comes to making your decision, so it is important to
come up with a range of options. This helps you determine which course of
action is the best way to achieve your objective.

 Weigh the evidence. In this step, you’ll need to “evaluate for feasibility,
acceptability and desirability” to know which alternative is best, according to
management experts Phil Higson and Anthony Sturgess. Managers need to be
able to weigh pros and cons, then select the option that has the highest chances
of success. It may be helpful to seek out a trusted second opinion to gain a new
perspective on the issue at hand.

 Choose among alternatives. When it’s time to make your decision, be sure that
you understand the risks involved with your chosen route. You may also choose
a combination of alternatives now that you fully grasp all relevant information and
potential risks.

 Take action. Next, you’ll need to create a plan for implementation. This involves
identifying what resources are required and gaining support from employees and
stakeholders. Getting others onboard with your decision is a key component of
executing your plan effectively, so be prepared to address any questions or
concerns that may arise.

 Review your decision. An often-overlooked but important step in the decision

making process is evaluating your decision for effectiveness. Ask yourself what
you did well and what can be improved next time.
MARKETING RESEARCH AGGREGATORS
The marketing research aggregator industry is a $120 million business that is growing by about 6 percent a
year. Companies in this field acquire, catalog, reformat, segment, and resell reports already published by
large and small marketing research firms. Even Amazon.com has added a marketing research aggregation
area to its high-profile e-commerce site.

The role of aggregator firms is growing because their databases of research reports are getting bigger and
more comprehensive—and more useful—as marketing research firms get more comfortable using resellers
as a sales channel. Meanwhile, advances in Web technology are making the databases easier to search
and deliveries speedier. Research aggregators are also indirectly tapping new markets for traditional
research firms. By slicing and repackaging research reports into narrower, more specialized sections for
resale to small- and medium-sized clients that often cannot afford to commission their own studies or buy
full reports, the aggregators are nurturing a new target market for the information.

Planning the Research Design and Gathering Primary Data

The research design specifies which research questions must be answered, how and when the data will be
gathered, and how the data will be analyzed.

Typically, the project budget is finalized after the research design has been approved. Sometimes research
questions can be answered by gathering more secondary data; otherwise, primary data may be needed.
Primary data, or information collected for the first time, is used for solving the particular problem under
investigation. The main advantage of primary data is that they will answer a specific research question that
secondary data cannot answer.

Survey research
The most popular technique for gathering primary data, in which a researcher interacts with people to obtain
facts, opinions, and attitudes.

In-Home Personal Interviews

Although in-home personal interviews often provide high-quality information, they tend to be very
expensive because of the interviewers’ travel time and mileage costs.

Mall intercept interview

A survey research method that involves interviewing people in the common areas of shopping malls.
 Computer-assisted personal interviewing
An interviewing method in which the interviewer reads the questions from a computer screen and
enters the respondent’s data directly into the computer.

 Computer-assisted self-interviewing
An interviewing method in which a mall interviewer intercepts and directs willing respondents to
nearby computers where the respondent reads questions off a computer screen and directly keys
his or her answers into a computer.

Telephone Interviews
Compared to the personal interview, the telephone interview costs less, but cost is rapidly increasing due
to respondent refusals to participate.

 Central-location telephone (CLT) facility

A specially designed phone room used to conduct telephone interviewing.
Executive interviews
A type of survey that involves interviewing businesspeople at their offices concerning industrial products
or services.

Focus group
Seven to ten people who participate in a group discussion led by a moderator.
  Group dynamics
Group interaction essential to the success of focus-group research.

The Role of Consumer Generated Media in Marketing Research

Consumer generated media (CGM) is that media which consumers generate themselves and share among
themselves. Because it is consumer-based, it is trusted more than traditional forms of advertising and
promotion.32 CGM originates from:
☛ Blogs
☛ Message boards and forums
☛ Public discussions (Usenet newsgroups)
☛ Discussions and forums on large email portals (Yahoo!, AOL, MSN)
☛ Online opinion/review sites and services
☛ Online feedback/complaint sites
☛ Shared videos and photos
☛ Podcasts

When Should Marketing Research Be Conducted?

When managers have several possible solutions to a problem, they should not instinctively call for
marketing research. In fact, the first decision to make is whether to conduct marketing research at all.

Some companies have been conducting research in certain markets for many years. Such firms
understand the characteristics of target customers and their likes and dislikes about existing products.
Under these circumstances, further research would be repetitive and waste money. Procter & Gamble, for
example, has extensive knowledge of the coffee market. After it conducted initial taste tests with Folgers
Instant Coffee, P&G went into national distribution without further research. Consolidated Foods Kitchen
of Sara Lee followed the same strategy with its frozen croissants, as did Quaker Oats with Chewy
Granola Bars. This tactic, however, does not always work. P&G marketers thought they understood the
pain reliever market thoroughly, so they bypassed market research for Encaprin aspirin in capsules.
Because it lacked a distinct competitive advantage over existing products, however, the product failed
and was withdrawn from the market.

Managers rarely have such great trust in their judgment that they would refuse more information if it were
available and free. But they might have enough confidence that they would be unwilling to pay very much
for the information or to wait a long time to receive it. The willingness to acquire additional decision-
making information depends on managers’ perceptions of its quality, price, and timing. Of course, if erfect
information were available—that is, the data conclusively showed which alternative to choose— decision
makers would be willing to pay more for it than for information that still left uncertainty. In summary,
research should be undertaken only when the expected value of the information is greater than the cost
of obtaining it.

COMPETITIVE INTELLIGENCE
Derived from military intelligence, competitive intelligence is an important tool for helping a firm overcome
a competitor’s advantage. Specifically, competitive intelligence can help identify the advantage and play a
major role in determining how it was achieved.

Sources of Competitive Intelligence

The Internet and its databases are a great source of CI. CI researchers can use Internet databases to
answer these and other questions:
☛ What articles were written about this market?
☛ What companies are associated with this product group?
☛ What patents have been filed for this technology?
☛ What are the major magazines or texts in this industry?
☛ What are the chances that I will find something in print on the target company?
☛ How many companies are in the same industry as the target company?
☛ Who are the reporters studying this industry?
☛ How can I be updated on industry and company events without having to constantly request the
information?