NOTE-9

Term-III
Course: Market Research

A case

Dr. V.K.Agarwal (VKA) is a 50 plus Engineer from IIT, Delhi and a Ph.D. in
Management from University of Pennsylvania, USA.

After his formal education in India and USA, as a non-resident Indian, he had worked in
several USA-based companies with branches in different countries, spread all over the
globe.

For the last 10 years of his tenure in USA, he had worked as a Senior Project Manager in
Mackenzie International (M.I.), where he had handled a large number of research
assignments emanating from different parts of the Universe, as a top level Management
Consultant – and a problem solver and decision maker.

In early 1990 A.D., he was sent back to India, based at Mumbai, as the then Country
Head.

VKA appreciated that, like any country’s macro and micro environments, India too had a
great, time-honoured overall “Indian culture” with its own specific sub-cultures of
beliefs, perceptions, attitudes and regional behavioural patterns, which ranged from
extreme non-rational and emotive base to completely rational basis for forming, for
example, specific buying patterns.

Obviously, economics-social-cultural-political-legal-technological consideration too

played very important parts.

VKA had specialized in:

1. Conducting Market Surveys, where data were generated, recorded, tabulated

and given to final customers without any depth analysis. In India, ORG-
MARG had specialized in large scale retail surveys, often based on broad-
based consumer panels. Depth analysis was not needed here, except to record,
say, weekly sales fluctuations.
2. Market Research: This type of study mostly ranged from exploratory base
(Identification of variables, attributes and their probable association for
hypotheses building) to descriptive and quantitative demand estimates and
potential assessment for known product-service lines in defined geographical
zones, subject to the known or probable marketing mix parameters (Product,
price, place, promotion, process, people) – based on known / projected
forecasts, at pre-specified time periods. These were often a combination of
quantitative, as well as qualitative assessments.
 Longer the time period for forecasts, greater the probability for errors, since
both independent and intermediate variables, and their magnitudes, changed
over time.

Broad “Variables” were identified, recorded and tabulated, based on generated

data or information or both, so asto arrive at pre-specified objectives like, to
mention a few:

- Present demand of known product: service lines

- Probable future potential
- Present “Company Image”
- Assessment of “Competitive strengths, weaknesses”.
- Market share assessment – now and in the near future etc.

However, the “Cause and effect relationship” ie the “Why” factor was not
explored in depth.

3. Marketing Research was far more generic, broad-based as well as in-depth

studies, where the “Cause-effect” aspects were explored in depth, after
considering all relevant macro, as well as micro variables affecting marketing
issues.

This type of causal study was not only deterministic in nature, but also created
a firm base for reliable forecasting and projections, provided reliable, valid,
substantial and consistent data base could be generated from past and present
sources.

These were also very costly and time-consuming studies.

Examples:

McDonald, like many foreign firms who tried to launch their existing product lines in
India, failed miserably, to start with, and had to beat a hasty retreat. They re-entered
India only after detailed:

- First level exploratory studies to identify those variables, typically Indian in

nature, which influenced large number of Indian buyers-users’ taste and
eating- out habits, and formed “Loose” probable association, yet to be tested
in the market, which too was very widely fragmented, taste-wise
- Then, a series of “Cause and effect” studies were organized, all over the
country – only after which they re-entered India with a totally Indianised
business strategy. [Use of samples was often resorted to (Aided research)].
Second example:

Before ‘90s, Castrol was forced out of India, primarily due to a macro-level
Governmental decision.

When they re-entered India, after getting a reprieve from the Government, Castrol’s total
business strategy, to start with, was re-designed, completely different from their earlier
first-level corporate strategy.

To combat Indian Oil’s “Servo”, the major industrial lubricant marketer and still the
market leader in terms of market share, growth rate, profitability and an overall Indian
spread, Castrol’s pro-active Management studied, once again, the relevant Indian market
via series of deterministic studies, followed by the “Why” factor regarding, for example:

- Segmental analysis of list of user relevant criteria, their prioritization, vis-à-

vis different competitive offers (An in-depth analysis of HOW end customers
react and to what extent each buyer-user segment is “Satisfied or dis-satisfied”
– why?)
- “Gap” analysis, segment-wise [Gap: Users’ expectations vs. actual offers]
- Castrol’s re-positioning strategy was then formulated – professionally and
scientifically.

The early’90s market re-entry strategy of Castrol, after they received the market-based
reports, besides previous Indian experience, was, broadly:

- Castrol’s planned low profile(s) on major, bulk buyers, who “Preferred” to

buy in bulk from IOCL – at that point of time
- Major emphasis was on the “Bazar sector” ie. small scale buyers-users, via
small-scale dealers, retailers, spread all over the country.

IOCL’s strength was on “Bulk” supplies, supported by a rigid, unwavering internal

logistics system.

Castrol, scientifically, focused their major attention on very large number of small
buyers-users, who were serviced by a large number of distribution channel members, who
ensured prompt, regular availability at acceptable quality - price levels. Top level back-
up service was provided via innumerable garages, mechanics, car repair centres and the
like.

Record 18% market share, at that point of time, could be achieved by Castrol against the
mammoth IOCL with its well-established manufacturing centres, all over India and that
too in a short span of time.

Dr. Agarwal was very well aware – thanks to his in-depth, top quality education,
experience, expertise that research decisions depended on few basic parameters like:
 - Why any research is called for at all? What are the relevant “SWOT”,
symptoms, problem formulation to identification – for which any study,
expensive and time consuming, is necessary?

Using well-known conceptual framework, the “Study background”

highlighting the “Problems”, needs to be clearly stated, to justify any study.

- Often, “Objectives” of any research are unclear, even in the minds of the
concerned decision-making unit (DMU) members. To start with, these MUST
be fully clarified by the Analysts, based on:

• Clear problem identification

• In-depth discussions with relevant DMU(s), who are expected to “Brief”
the researchers.
• Simultaneously, study the firm’s past, present achievements and failures.

Hence, both problem identification and objective clarity need to be clearly stated and
recorded. Statements like “In 2010-2011”, increase sales revenue by 10%” will never be
enough, unless sub-issues, like the following, are first diagnosed and recorded:

- Why this objective is relevant?

- Clear firm-level “Diagnosis-prognosis” is called for, alongwith the practicality
of achieving it ie. clear “Constraints” statement
- Competitive inroads
- “Strengths-weaknesses” of the firm ie. its resources, technological base etc
- Relevant macro and micro-level influences.

Dr. Agarwal was clear that for each project, the above are FIRST needed to be clearly
explained. Then only, methodological aspects (Enclosure-I: format for Research
Proposal) will have to be designed, one by one.

During his first in-depth internal training for his 50 local Indian Researchers, he gave a
hypothetical project profile (See below). In groups of 25 Analysts / group, the 50 odd
research staff were asked to come out with a full Research Proposal, starting with:

- Study background
- Research objectives
- Constraints

First, these were organized by each group (Two separate groups were formed).

The research profile (Hypothetical study)

Please study given “Excerpts” from a real life Indian assignment, with hypothetical data
base: Enclosure-II
Assignment for each study group (Section-wise): Two groups per section

1. How will you form “Study objectives”? You can use:

- Face-to-face discussions / interviews

- Hypothesize the objectives, based on, say, past experience
- Role-play [One group: client. Second group: Researchers).
- Observations; past data, if any
- Any others?

2. Same goes for constraint identification

3. Methodology:

- Activity sequence (PERT-CPM for very large projects)

- Sampling (Vs. Universe)
- Survey methods
- Research Instruments
[Design these like, say, structured questionnaire]

- Broad plan for analysis

- Reporting format
- Study team
- Cost-time estimate vs. activity plan: form a tabular chart
- Presentation plan
- Finally relevant annexures.

Top-up: Short executive summary (2-3 pages).

Suggestion:

Two groups (In each section) can share the full workload and work as a team. Groupwise
presentation will have to be organized.

Individual assessment, however, will be done.

Focus: workload / group / section

Based on data provided (Study six tables), working backwards, each group will prepare a
14-step Research Report and present it over 50 minutes [Use tables, graphs etc] – to be
followed by 25 minute long involved discussions. A short but specific report is solicited
from each group, where, in the “Executive summary”, basic emphasis will be on”:
 - Findings (Partly provided: 6 enclosures)

Prepare - Conclusions
yours
group’s - Specific recommendations to Management
of Philivision.

Assume:

If called for and state your logic clearly.

 Annexure-I
Structure of a Research Proposal:

14 “PARTS”

- Background to each study: Why this study? Use SWOT

- Clearly defined study objectives

- Limitations / constraints

- Methodology:

• Project activity flow

• Sampling (Vs. Universe)

• Survey methods

• Research Instruments

• Plan for analysis

• Report preparation

• Audio-visual presentations

Related components:

• Study team

• Time, cost estimates

• Back-up annexures

Most important: Practical output [Executive summary]

Start with this in the report.
 Annexure-II

ASSIGNED RESEARCH TEAM

Dr.(Ms.) L.Mitter, M.Sc. (Stat.), Ph.D (South

Carolina University, USA)
Project Director

Project Ms.D.Ghosh, MA, B.Ed.

Controller [Total time-cost (Budgetary)
control and field control]

Two
Research
Executives

Mr. B.Biswas
MA (Eco.), MBA
And Mr.Anjan Chakraborty
MA (Eco.), MBA

Four field persons

A B C D
(All B.Com with field experience)

In-house functions Recording

At Tabulation
Kolkata Analysis
Interpretation
Report writing
Dr. Mitter Ms.Ghosh
A typical example
Raw data
TABLE-1
NO. OF B/W TV SETS SOLD
AND EXPECTED TO BE SOLD IN 1988-91
Names of manufacturing Yearly sales in units
companies
1988-1989 1989 – 1990 1990 – 1991

14” 20” 14” 20” 14” 20”

Keltron (1) 50 40 30 20 20 15

Onida (8) 1475 640 1525 650 1605 660

Philips (35) 6796 1597 6916 1757 7659 1876

BPL (3) 150 20 150 20 160 20

Videocon (6) 425 496 495 496 560 535

Crown (2) 250 100 250 100 270 100

Uptron (14) 2350 620 2365 625 2545 625

Salora 150 60 150 60 150 60

Panorama (2) 720 94 720 94 725 104

Webel-Nicco (18) 2279 643 2289 638 2375 663

Bush (6) 640 389 670 389 695 405

Solidaire 12) 200 90 210 90 215 85

Oscar (12) 1516 320 1541 305 1670 380

Beltrek (5) 492 135 532 105 550 115

Televista 48 24 48 24 55 25

Orson (14) 1496 467 1496 462 1580 539

ET & T 77 77 77

EC (1) 65 15 90 24 90 30

Sonodyne (19) 2108 846 2150 857 2310 905

Telerama (17) 2487 923 2397 997 2397 1023

NELCO 36 36 40

Atari 186 196 206

( ) This denotes number of dealers dealing with the particular brand.
 TABLE-2

NO. OF COLOUR TV SETS (TOTAL) SOLD AND TO BE SOLD

IN 1988 – 91 (BOTH REMOTE AND NON REMOTE CONTROL)

Names of manufacturing Yearly sales in units

companies
1988-1989 1989 – 1990 1990 – 1991

14” 20” 14” 20” 14” 20”

Philips (37) 5126 5126 5795
Salora (1) 80 100 100
Weston (3) 72 80 85
Atari (3) 168 184 196
Videocon (29) 7442 7707 8330
BPL (14) 1795 2050 2200
Crown ( 2) 150 150 170
Bush (17) 231 800 286 800 296 810
NELCO (13) 1026 1026 1098
Optonica (10) 810 830 850
Solidaire (5) 430 410 440
Keltrone (1) 48 48 48
W.Nicco (15) 1308 1308 1308
Sonodyne (17) 1560 1674 1868
Beltek (5) 500 500 520
ET & T (1) 80 100 100
EC (1) 72 72 72
Oscar (11) 30 1320 1320 1320
Sears Elcot (1) 48 48 48
Onida (7) (14”) 752 6045 839 6410
(20) (20”)
Orson (12) 882 917 937
Telerama (10) 1309 1309 1389
Uptron (11)

( ) Denotes number of dealers selling the particular brand

Eg. Out of 50 dealers interviewed, 37 dealers sell Philips Colour T.V.

TABLE-3
 BREAK UP (RC/NON RC) OF COLOUR TV SETS OLD
AND TO BE SOLD IN 1988-91

Name of companies Yearly sales in units

1988-1989 1989 – 1990 1990 – 1991

20” 20” 20”

RC NON-RC RC NON-RC RC NON-RC

Philips (2) 235 480 235 480 275 615

Videocon (5) 1440 2290 1500 2390 1610 2600

BPL (3) 105 470 125 575 145 600

Bush (2) 15 180 25 225 30 230

NELCO (2) 120 405 120 405 120 425

Optonica (1) 80 300 80 300 80 300

Solidaire (2) 80 370 90 390 100 400

Sonodyne (1) 70 150 80 160 80 170

Beltek (1) 70 200 70 200 80 210

Oscar (2) 200 670 220 690 220 700

Onida (6) 1405 1780 1450 1890

Orson (3) 110 450 120 475 140 500

Telerama (1) 130 420 130 420 160 450

Uptron (3) 150 320 150 320 175 335

( ) This denotes number of dealers, who could give the break up for RC/NON RC TV sets.

Eg. Out of 37 Philips dealers only 2 dealers could give the break up.

[R/c: Remote Control]

Study present and expected sales patterns

 TABLE-4

RANKING OF COMPANIES BASED ON

DEALER NETWORK AND ANNUAL SALES

Brand Ranking Ranking Annual sales

(Dealer network) Sales (Annual)

B/W
Colour B/W 14” 20” Colour TV
Philips (1) 1 1 1 3

Videocon (2) 8 13 8 1

Onida (3) 6 8 5 2

Sonodyne (4) 2 5 3 5

Bush (5) 7 11 9 12

Webel-Nicco (6) 3 4 4 8

BPL (7) 4

NELCO (8)

Orson (9) 5 7 7 9

Uptron (10) 3 6

Oscar (10) 6 10 7

Optonica (10) 11 10

Telerama (11) 4 2 2 6

Salora (11)

Beltek (12) 12 11 13

Solidaire (12) 15 14 11

Panorama 10

Crown 14 12 15

Atari 14

TABLE-5
 VIEWS OF DEALERS
[A FREQUENCY DISTRIBUTION TABLE]

Sr. Brands Picture quality After sales Maximum Supply schedule MaximumAd
Nos and south service commission support

1*1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4
5
1 Philips (32) 21 7 4 5 22 5 5 5 18 7 6 3 3 22 10 4 1 20 6 4
3

2 BPL (14) 3 5 5 1 3 3 3 3 2 1 2 3 2 6 2 2 3 7 1 2 4 5
2

3 Videocon (25) 5 14 6 4 5 16 6 2 11 12 6 11 12 3 2 1 11 16 2

4 Onida (20) 11 21 2 3 12 5 3 13 6 1 12 5 3 13 6 1

5 Sonodyne(17) 2 6 2 7 1 4 3 2 7 2 3 3 8 8 4 5 2 5 5 2
3

6 Orson (12) 1 7 4 2 3 3 4 2 4 3 3 3 3 4 2 2 4
3

7 Webel 2 3 5 5 2 3 5 5 3 4 4 4 1 3 4 7 3 2 4
Nicco (15) 6

8 Bush (17) 1 3 8 2 3 1 4 5 3 3 2 3 3 3 6 1 1 7 5 3 2 1 6 7
1

9 Oscar (11) 1 3 3 4 2 2 5 2 1 1 2 4 3 2 2 2 5 1 2 2 3
3

10 Uptron (11) 2 3 3 3 4 3 1 3 2 4 5 5 3 3 2 1 3
5

11 Telerama (10) 1 1 1 6 1 3 1 2 1 3 2 4 4 1 1 6 2 1 6 2
1

12 Nelco (13) 3 2 4 4 3 3 4 3 1 3 3 3 3 1 2 2 4 4 1 2 4 6

13 Optinica (10) 3 3 2 2 1 3 3 3 4 2 2 2 2 2 2 2 2 3
2 4

An explanation: *1 For No.1 → top quality: views of 21 dealers (Picture quality and sound) out of
37dealers (Multiple responses were also recorded)

BPL TV, for example, was catered to by only 14 dealers.

[1, 2, 3, 4, 5: Out of best 5 manufacturers of TV].

 TABLE-6

BRAND RANKING (VIEWS OF DEALERS) – BEST 5 ONLY

1 2 3 4 5

Picture quality
&
Sound Philivision Onida BPL Videocon Bush

After sales Onida Philivision Videocon BPL Telerama

service

Maximum Onida Videocon Philivision Optonica Nelco

commission

Good supply Onida Philivision Videocon Webel-Nicco Orson

schedule

Maximum Av. Onida Philivision Videocon Telerama Orson

support

Key: 1. Best
2. Second best
3. Third best
4. Fourth best
5. Fifth best.