Marketing Research (Best Tutorial 2019)

Marketing Research

Introduction to Marketing Research

1.  Marketing research is the planned and systematic search for the truth on how to meet consumer desires and needs. Marketing started with a production concept where the goal was to make goods cheap and easy to purchase. Once a sufficient flow of consumer goods was being produced the emphasis switched to a sales approach.

 

Today research is necessary if any type of organization is going to follow the marketing concept of putting consumer needs and desires first. Communications technology and social media are presenting new opportunities for marketing research.

 

2. Marketing research can be defined as a means of gaining information on marketing problems and opportunities. Marketing research is used to answer organizational questions in an effort to reduce risk and therefore reduce expensive mistakes. Research can be used by large corporations, but also by small businesses and community organizations.

 

3. Marketing research developed as a separate professional field when businesses started to grow from local to national companies. Owners of larger businesses could no longer know their customers personally.

 

These business owners needed to use research to discover their customers’ needs and desires. Today, marketing research professionals can work in the marketing departments of large companies or specialized research firms.

 

4. The traditional process for developing a marketing plan lists marketing research as a distinct step. It is better to think of marketing research as a tool that is helpful in every step of the marketing process.

 

The research process creates data. It is the researcher’s responsibility to turn these data into useful information that provides the knowledge to solve problems.

 

5. Ethics form a system that helps to determine what is right and good from what is wrong and bad. When ethics are applied to daily life they can be used as guidelines on how to act. A code of conduct is a formal statement by an organization of which actions are allowed and which are prohibited.

 

Ethical standards are important in marketing research to protect the integrity of the field and also to protect participants, especially children, from harm. Social media present unique ethical issues that can be addressed by determining the age of respondents and the privacy of the information.

Marketing

Marketing is the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, and partners.

 

The definition describes marketing as an exchange that offers value for both the seller (organization) and the individual (buyer). Marketing is sometimes misunderstood as only selling, with the organization convincing the buyer to purchase something they don’t want or need.

 

While selling is an important part of the promotion, there would be no long-term gain for any organization to focus only on selling their product.

 

Even if they could use high-pressure sales techniques to convince buyers to purchase, business success relies on repeat customers. Such customers would most likely feel manipulated and be unlikely to purchase again.

 

The definition also states that an organization should only provide products that fulfill its goals. Thus the organization has a mission and a strategic plan and marketing exist to help the organization meet both, while at the same time meeting the needs of customers.

 

Therefore, marketing is much more than just the promotion of a product. The field can be described as a circle with the customer in the middle surrounded by the four ‘Ps’ of promotion, price, product, and place.

 

All four of these components of marketing must provide the customer with a wanted or needed a product at an acceptable price, in an appropriate place, and with the effective promotion. However, to accomplish this goal the organization must first listen to the customer’s wants and needs.

 

Technological developments have changed the way business is done both internally and between business and the consumer. Both marketing strategy and marketing research has been affected by the development of technology that allows rapid two-way communication between people across distance.

 

It is now much easier to hear from consumers if a product is meeting their expectations. In fact, consumers will not only let the company know; they will also let everyone else know by posting their opinions online.

 

Comments on social media allow market researchers to understand consumer preferences by reading reviewers, following bloggers and watching trends. Familiarity with the ever-evolving apps that people use to access and share product information is necessary.

 

There are so much data available that there is now data collection software that will search the social media landscape to find comments, both positive and negative, about a company’s products. As a result, the ability to analyze data is often now a required skill for market researchers.

 

Stages of marketing development

marketing development

Marketing has developed and evolved as social and business conditions have changed. An early approach to marketing was focused only on the production of goods. When consumer goods became more plentiful, the approach changed to selling as a means of convincing consumers to buy.

 

Although these two approaches still exist in some industries, the current recommended approach is the marketing concept that instructs companies to first focus on consumer wants or needs.

 

Companies using the production concept will emphasize the most efficient way to produce products that provide high quality and low price. When using this approach, companies see the marketplace of consumers as a single group with similar needs who will purchase any well-made, reasonably priced product.

 

When Isaac Singer invented the home sewing machine there was a great need for his product. Its successful introduction to the marketplace is an example of the production approach (see the case study below).

 

The problem with this approach today is that people can choose from so many products with high quality and low price. Therefore, consumers also want the products they purchase to provide additional benefits. The production approach does not address this issue. To determine what additional benefits are desired, it is necessary to conduct product research.

 

The sales concept focuses on using the right sales technique. When companies were able to produce more mass-produced goods than were immediately needed by consumers, they started to focus on how to sell products. A company using this approach will assume that customers will not purchase their product without considerable persuasion.

 

This approach is still used today in certain industries. For example, life insurance is a product that is needed but that consumers do not usually enjoy buying.

 

A salesperson needs considerable skill in sales techniques to overcome this resistance. If the sales concept is used consumer research is still needed to determine which approach will be most successful.

 

Even with research, the sales concept usually does not lead to repeat purchases and therefore is generally not recommended for consumer goods.

 

The marketing concept, which starts by taking into consideration what benefits consumers desire, is the approach recommended by most marketing experts. This approach is recommended because there are now so many products available in the marketplace that only those products that provide consumers with the benefits they desire will be purchased.

 

The marketing concept, where the needs and desires of the consumer are taken into consideration when the product is designed, is considered the best approach to marketing.

 

However, in order to follow this concept, an organization must know what consumers need and want. In fact, marketing research is needed equally by both those businesses that sell tangible goods and those companies that sell intangible services.

 

An example of how a financial institution can use research is given in the box below. Once again, the only way for companies to know what consumers desire is through marketing research.

 

For this reason, research can no longer be considered an optional activity in which the organization engages if it has the time and money. If research is not conducted, there is a good possibility that the time and money an organization does have will be wasted.

 

If the Car Drives Itself What is the Driver Going to Do?

New technology is going to affect how many existing products are used. For example, the age of self-driving cars is almost a reality. Over 50 percent of cars sold now have some driver assistance safety technology installed. Renault and Nissan are working on selling several models of totally self-driving cars by 2020.

 

Consumers are interested. Research has shown 32 percent would drive such vehicles on motorways and 18 percent in cities. Why are they interested? Forty-nine percent feel that they would help in traffic jams.

 

Consumers do have some concerns. According to the survey most do not trust the technology. A majority of drivers state that they would feel unsafe in a self-driving care. A third of respondents do not trust a self-driving car to avoid a collision.

 

These facts make the following participant response rather surprising. When asked what they would do in a self-driving car, 26 percent stated they would take a nap!

 

If cars are driving themselves, the experience of getting from place to place will change. The research will be needed to determine how consumers will use the time and what type of products they might need to fill the time while the car drives itself.

 

Question: How can you determine what behavior people will engage in, in a self-driving car?

 

Defining Marketing Research

Marketing Research

The official definition of marketing research, according to the American Marketing Association (AMA).

 

Marketing research is the function which links the consumer, customer, and public to the marketer through information – information used to identify and define marketing opportunities and problems; generate, refine and evaluate marketing actions; monitor marketing performance; and improve our understanding of marketing as a process.

 

Marketing research specifies the information required to address these issues, designs the method for collecting information, manages and implements the data collection process, analyzes the results, and communicates the findings and their implications.

 

This definition may be meaningful to a marketing professional but may be difficult for someone studying marketing to understand. The definition is easier to comprehend if the four ways research can be used are explained individually:

 

1. Identify and define marketing opportunities and problems’ means using research to explore the external environment.

 

2. Generate, refine and evaluate marketing actions’ means using research to determine whether the company is meeting consumer needs.

 

3. Monitor marketing performance’ means using research to confirm whether the company is meeting the goals it has set.

 

4. Understanding marketing as a process’ means using research to learn to market more effectively.

 

Although the AMA definition is a useful summary of all that marketing research can accomplish, a simpler definition can be constructed. According to the dictionary, the word ‘research’ means to search or investigate exhaustively or in detail.

 

The thesaurus gives as a synonym for ‘research’ the word ‘inquiry’, which means the act of seeking truth, information or knowledge. So market research can be defined as a detailed search for the truth.

 

Marketing has always had the function of connecting the internal structure of the organization with the external world. Marketing research is a formalization of this role.

 

Research that is conducted can be divided into two types. Basic, or pure research, is conducted to discover new knowledge. When the research is planned and conducted, its application or how the knowledge might be used is not of major importance. What is important is that new information is discovered.

 

After the research has been conducted, how the information can be used is then considered. Universities or very large corporations conduct most basic marketing research.

 

In applied research, the research is planned so that the findings can be used to solve a specific problem. This is the type of research conducted by marketing professionals working either within an organization or for an external marketing research provider.

 

After all, if a business is paying for research to be conducted, it needs results that will show how to solve a problem. Most businesses do not have the time or money to pay for basic research.

 

The important fact to remember about applied research is that the information gathered will be used to assist in making decisions. The decision might be critical and costly, such as which new product to introduce.

 

Or the decision might be of lesser importance, such as what color should be used in a brochure. Whatever the decision, the rationale of all applied marketing research is to help organizations to limit risk, because making mistakes is expensive.

 

Decisions that carry a great deal of risk, such as new product introductions, will require a great deal of research. Such projects may require a full-scale research project combining more than one research method and a large number of participants may be needed.

 

Conducting the research will be costly but the expense is acceptable because making the wrong decision will result in a very expensive mistake.

 

A small decision, such as what color to use in a brochure, still needs marketing research to eliminate risk – but the research can be on a much smaller scale because the risk, which there is only the cost of reprinting the brochures, is less.

 

The Development of Marketing Research as a Profession

Marketing Research

At the beginning of the twentieth century, there was a growth both in the number of universities and also in the number of academic fields being taught. These new academic subjects, including psychology and sociology, were interested in applying scientific methods to social problems in ways that would help to explain human behavior.

 

However, this interest in applying scientific methods did not apply to purchase behavior and there was, as yet, no academic area of study called ‘marketing’ or ‘marketing research’.

 

Yet during the same time span, in the business world marketing research became a recognized professional field. Throughout this period of economic history businesses were starting to grow from small local or regional companies to larger national companies.

 

Since they were now selling their products over a wider geographic area it became more difficult for companies to identify and understand their customers.

 

Such an early marketing problem was faced by auto manufacturers. Once people who had the desire and money to purchase cars had done so, the manufacturers needed to know how to use advertising to reach additional consumers.

 

As a result, the research method of surveying was borrowed from the social sciences. However, early research survey studies confronted the key problem of identifying the appropriate consumers to include as participants.

 

So once again, researchers turned to scientific methods and adopted sampling to identify the appropriate consumers to include in studies. This new method was useful when the potential consumer group was large in number, which was indeed the case for auto manufacturers.

 

However, the research conducted was limited to focusing on finding customers for existing products rather than finding out about consumer desire to improve products.

 

Market researchers soon discovered that besides surveying and sampling, they could also borrow additional techniques from the social sciences. In 1931 a manual for marketers, Marketing Research Technique, described not only how to use surveys but also discussed interviewing and focus groups as ways of conducting marketing research.

 

Because of the successful use of these new techniques, interest in marketing research continued to grow during the 1930s. After the end of World War II, there was a pent-up demand from people for the consumer goods they could not purchase during the war years.

 

However, once production caught up with demand, companies realized their need to learn sales techniques. When such sales techniques did not sell enough products, they then tried to find additional customers and so started to focus on meeting consumer desires for products.

 

Marketing research was now needed to determine these desires and specialized marketing firms evolved to provide marketing research services to companies. As a result, universities started to teach marketing research as an academic field to provide the necessary professionals.

 

Marketing research today

marketing research professionals

Students who have studied marketing research are often employed in the marketing departments of large companies. Specialized marketing research firms also employ marketing research professionals.

 

These firms contract to provide market research for businesses and nonprofit organizations that do not have the employees to conduct their own. The box below shows two job advertisements and what qualifications are needed.

 

I Want the Job!

Below are two job descriptions that give some idea of the range of duties and responsibilities that a market researcher may perform. The first is for a position that requires the traditional marketing research skills.

The second is for a position that reflects the need for the technical and analytic skills that are now sought.

 

Marketing Research Professional within a Corporate Marketing Department

The person will design and execute project plans for market research studies, including customer satisfaction and market awareness, design surveys, analyze results and prepare concise reports that communicate research findings.

 

They must also be able to conduct analyses, trending, and interpretation of data for use by the sales division.

 

He or she will work closely with the sales force to communicate critical market research findings. The person hired must have strong analytical and communications skills, and be skilled in quantitative and qualitative research methods, survey design, statistical analysis, and data collection techniques.

 

Marketing Research Planner in a Specialized Market Research Firm

The Customer Insights Manager combines analytical and technical skill leadership with strong management abilities to deliver valuable and actionable customer insights.

 

This position, along with a small team of analysts, is responsible for supporting the executive team and other key stakeholders across the organization on strategic decisions that will grow and retain customers with reporting and in-depth analysis of customer behavior and engagement. This position also focuses on optimizing the team’s technical environment and streamlining data processes.

 

Marketing research responsibilities with corporate marketing departments or with specialized firms include conducting studies using methods that gather statistical information (quantitative studies).

 

Other professionals conduct studies that gather verbal and other types of data (qualitative). Most marketing research jobs require skills in conducting both types of research.

 

Job responsibilities within a marketing research firm or department at the lowest level will include tabulating results and assisting in preparing final reports. Positions with more authority would include analysts who plan research projects, analyze data and write the reports.

 

 Specialized responsibilities would include people trained to conduct the research, such as focus group moderators and statisticians who can use computers to work with large volumes of data.

 

Above everyone would be a research director who would report to the client who hired the research firm or, if the research department is in a large firm, to upper management. However, today all business people should learn marketing research skills because they are critical to successfully managing a business.

 

Marketing Research and the Development of the Marketing Plan

 Marketing Plan

Research is too often thought of as only being useful in answering specific marketing questions. It is true that research is needed to answer such questions as what types of new products consumers might want, or what new market segments to target for an existing product.

 

However, it is better to conceptualize marketing research as a tool that should be used on a continual basis for finding new opportunities and solving problems. Marketing research needs to be regarded as an ongoing marketing activity.

 

Research plays a critical role in the development of a marketing plan for all types of businesses and organizations, both large and small and for-profit and nonprofit.

 

Marketing research has traditionally been seen as just one component in the marketing plan, but it is better to consider research as part of the entire process of developing the marketing plan and not as a single step In fact, the field of marketing research is being changed by new technologies.

 

The marketing researcher is now seen as a consultant who can either conduct the research themselves or help organizations learn how to use the new online tools so they can conduct their own research.

 

The ability to analyze and gain insights from consumer online comments is now an expected skill. Rather than see research as only one step in the process of developing a marketing plan, it should be seen as essential to the entire process.

 

After all, research is the only way a company can conduct environmental and competitor analysis. The research conducted may involve a large-scale study or be as simple as visiting a competitor’s store and reading the local business news. Research is also the only means marketers can use to understand buyer motivation.

 

This research may consist of a large formal survey, informal interviews, or both. First, the proper target market segment cannot be chosen without researching the demographics of the consumer marketplace.

 

Next, additional consumer research will be needed to determine what a target segment needs and wants. Finally, decisions about product, distribution, pricing, and promotion can only be successfully answered after conducting marketing research.

 

The researchers may find that there is a need for a new product category that was never thought of before.

 

The relationship between data, information, and knowledge

knowledge

The purpose of research is to provide the knowledge needed to solve a problem and not just to answer a question as to the cause of the problem. Too often researchers lose sight of this simple fact.

 

Instead, they view research simply as a means of collecting data. As a result, a complex research study is designed that gathers a great amount of data about a problem.

 

These data are then bound with a strikingly designed cover and given to management – along with a large bill for the service. It is then assumed that management will be able to turn such data into the answer they need to solve their problem.

 

While the research process might have been rewarding for researchers, those managing the organization will be left dissatisfied. Managers need more than raw data. They need information that explains the causes of a problem and then the knowledge that provides answers to the problem.

 

The relationship between data and knowledge

  • Data: Raw facts discovered by research
  • Information: What the facts mean to the organization
  • Knowledge: What the organization should do based on the information

 

It might be helpful to use physical illness and the patient-doctor relationship as an example in explaining the relationship between data, information, and knowledge. For example, a patient may go to the doctor because they are having a problem sleeping at night.

 

After questioning the patient, the doctor will order tests (research) to confirm the diagnosis. The doctor could then hand over the test results to the patient in raw data form as they were received from the lab, but this would be totally confusing to most patients and therefore of little assistance.

 

The doctor could go one step further and provide information to their patient by explaining the cause and diagnosis of the problem. The patient now has information and a name for what is wrong. However, what the patient really needs is the knowledge of how to solve the problem.

 

The patient needs to know more than what is wrong – he or she wants the answer to the question, ‘How can I get to sleep?’ Researchers should use their skill and experience to analyze the data to provide understandable information and then use the information to provide knowledge about the solution to the problem.

 

Ethics in Marketing Research

Ethics

Ethics provide a system that helps a person to determine what is right and good from what is wrong and bad. Ethics also provide an individual with guidelines that will help in making decisions.

 

The ethical system a person uses for making decisions in his or her personal life most likely is the result of family or educational influence, or both of these. However, the ethical behavior of people continues to be shaped by their environment, even as adults. This includes the environment in which they work.

 

An ethical system for employees of an organization is often called a code of conduct. If a company employs a researcher and does not have a code of ethical conduct, the researcher can use a code produced by a research association or society. A code of conduct is important because research is the search for true information.

 

To knowingly conduct research that is biased is harmful to both the individual researcher and the field of research as a whole. With the renewed emphasis on corporate ethics (or the lack of them), marketing research ethical issues should not be taken lightly.

 

It is sometimes said that any actions internal to a company that is not against the law should be allowed. However, just because something is legal does not make it ethical.

 

Ethical research issues

Ethical research

The first issue where a researcher may encounter an ethical dilemma is if the purpose of the research itself is unethical. It is the researcher’s responsibility to ensure that the research study is not designed to obtain predetermined results.

 

After all, by manipulating who is asked and the way questions are phrased, it is possible to design a study so that it will obtain predetermined answers. Sometimes the organization commissioning the research may have the desire to reach a particular outcome.

 

This can be communicated to the researchers by stressing that obtaining the contract for research may hinge on ensuring the desired research findings. It is better for the reputation of a researcher if the research is never undertaken than to report results that are knowingly misleading.

 

By participating in this study, not only is a researcher acting unethically, they are making all future research efforts suspect. Sometimes researchers will work with groups that are particularly vulnerable, such as children. Extra care must be taken that they are not harmed during the research process.

 

Another guideline in conducting research ethically is always to be honest with the participants. For this reason, research participants should always be told who is conducting the research, what methods will be used and the amount of time that will be necessary. Participants should also be informed of how the data collected will be used.

 

Finally, if deception is necessary as part of the study, the participants should be informed that the true topic of the research will not be revealed until after the research is conducted. After providing this information, the researcher should answer any questions the participants may have.

 

When conducting qualitative research, indirect methods are often used to obtain information, for example perhaps when conducting observational research at an airport, researchers may appear to be fellow travelers.

 

In focus groups, the clients commissioning the research may watch the participants from behind a screen or one-way window. Sometimes participants in an interview may be told that the subject to be discussed is different from the real topic.

 

Although some of this deception is necessary for the research process, this does not mean that the researcher does not need to consider ethical issues. If at all possible, researchers should present themselves accurately and be honest with participants as to the purposes and methods of the research

 

A third ethical issue relevant to market researchers is to avoid any harm to the participants. Market researchers may borrow research tools from the social sciences, such as the field of psychology, but are not trained as social scientists or psychologists.

 

Therefore, marketing researchers must be very careful not to cause participants any emotional distress.

 

A researcher for a product such as intruder alarms may legitimately want to know about how safe people feel in their own homes and what would make them feel safer. Factual questions such as ‘Has your home ever been broken into?’ are therefore a necessary part of finding and interviewing a potential target market segment.

 

However, market researchers must be extremely careful to avoid such questions as ‘Will you tell me how you felt when you were attacked?’ These questions can open a floodgate to emotions to which the researcher is not trained to respond.

 

The emotional wellbeing of participants in focus groups and interviews should also be respected. While follow-up questions are a legitimate part of the process, participants should not be pushed to respond to questions when they feel uncomfortable or evidence distress with the topic. Researchers cannot know the personal history of the participants.

 

A question about a flashlight or torch use may ask ‘How do you feel when the power fails and you are left in the dark?’ This might trigger an unpleasant or troubling memory for participants. A better question, which is designed to elicit facts and not emotions, would be ‘What do you do when the power fails?’

 

Conducting online research presents new ethical issues, One of the issues with the posting of surveys on social media sites is that children might respond without their parents’ knowledge. Since children cannot be involved in marketing research, even a survey that is not aimed at children should have age restrictions posted.

 

A second issue is observing comments and videos online. Such data can be very useful to marketers as they provide information on both product preference and product use.

 

If the comments and videos are on sites that are open to anyone, such as review sites or YouTube, the information can be used as research. If the site requires permission to enter, then the marketer should request to use the information for marketing purposes.

 

Guidelines for conducting ethical research

  • Never conduct research where the search for truth is compromised
  • Always be honest with research participants
  • At all times protect participants from harm

 

Below is an example showing the statement of ethical principles for the Market Research Society. Even for someone who does not belong to the Society, these are still excellent principles to follow.

 

Market Research Society: Ethical Principles

Market Research Society

The Market Research Society (MRS), with over 8,000 members in more than 50 countries, is the world’s largest international membership organization for professional researchers and others engaged or interested in the market, social and opinion research. Their code of conduct spells out that members must:

 

  • Ensure that research conforms to the national and international legislation relevant to a given project
  • Take reasonable steps to avoid conflicts of interest with clients or employers and must make prior voluntary and full disclosure to all parties concerned of all matters that might give rise to such conflict Act honestly in their professional activities

 

  • Take reasonable steps to ensure that others do not breach or cause a breach of this code
  • Not act in a way which might bring discredit on the profession, MRS or its members

 

  • Take all reasonable precautions to ensure that participants are not harmed or adversely affected by the member’s professional activities

 

Key Terms

applied research conducted to solve an immediate problem

code of conduct official list of standards of what is acceptable and unacceptable behavior

ethics set of beliefs used to distinguish what is right and good from wrong and bad and that result in a duty or obligation to act in a certain way

marketing concept philosophy that states the purpose of marketing is to provide consumers with products they either need or desire

 

marketing plan description of how a company plans to meet consumer needs by targeting a specific market segment with a needed product at the right price, sold at the correct place and promoted effectively

 

marketing research ongoing process of gathering accurate information from the external environment and consumers to assist the company in implementing the marketing concept

 

observational research methodology where information is gathered by watching participants and recording their actions

 

production concept marketing philosophy that states that the company’s decision on what to produce should be determined by what product can be produced best at the lowest price

 

qualitative research based on social science principles used when the problem is still vague or when information is sought on feelings, beliefs, and attitudes

 

quantitative research based on scientific principles used when proof of a fact is needed or when the research question deals in descriptive facts such as who or how many

the research proposal was written a plan of action that describes why and how the research will be conducted and also how the resulting information will be analyzed and reported

 

sales concept philosophy that states the most important function of marketing is sales and that consumers can be convinced to buy a product if the right sales strategy is followed

 

The Uses of Marketing Research

Uses of Marketing Research

Marketing research is used to answer fundamental questions that affect the future of an organization. Therefore, marketing research is a skill needed by all types of organizations, both large and small.

 

Small businesses, as well as large corporations, can benefit from the knowledge that research provides. In addition, community, arts, and other nonprofit organizations can also benefit.

 

Small businesses may believe that they do not have the resources to conduct marketing research. However, a small business usually operates on a narrow profit margin leaving it particularly vulnerable to competition.

 

Even losing a small percentage of customers can mean potential bankruptcy. Therefore, small businesses need to research what products and services customers want and need.

 

In addition, it is essential that they conduct research on a continual basis as to what products and services are being offered by competing businesses.

 

Nonprofit organizations may also feel that they do not have the time or money necessary to conduct research. Yet all types of nonprofit organizations can benefit from conducting research.

 

For example, community-based social service nonprofits could use research to determine what services are needed by the people they serve. Other nonprofits, such as arts organizations, face the challenge of finding audiences and can use research to help with segmentation and promotion decisions.

 

Large corporations often have internal marketing research departments. Even so, they sometimes hire specialized external marketing research firms to conduct research.

 

Marketing research is especially necessary when corporations develop new products or reposition current products. Research is needed to thoroughly analyze consumer needs, as a failed introduction or repositioning of a product can be a very costly mistake.

 

Marketing research and the organization

organization

A marketing department provides an organization’s connection between its internal structure and the external environment in which it exists. A company’s internal structure will consist of such departments as operations, human resources, production, finance and purchasing, while the external environment will consist of larger societal forces.

 

Research is the tool by which a marketing department can understand how the external environment will affect an organization’s strategy. A marketing department will also provide needed information to other company departments.

 

The external environment can be pictured as a sphere surrounding an organization. The components of the external environment include the economic, competitive, legal/political, social and technological.

 

It is the role of marketing departments to explore these environments and to look for problems and opportunities of which companies should be aware.

 

For example, marketing research can assist purchasing departments in answering the political question as to whether a government crisis in another country will affect the price of raw materials. Sales departments may need assistance in answering the economic question of how a decline in income will affect consumers’ purchasing habits.

 

Production departments may need help in answering legal questions, such as whether new governmental environmental regulations mean the redesign of product packaging. Marketing research should be used on an ongoing basis to answer these types of questions.

 

Aside from the external environment, a marketing department also needs to communicate between an organization and their consumers.

 

A marketing department needs to supply the organization with the information to help determine the right product, price, place and promotion that will motivate consumers to purchase. Unfortunately, some companies assume they know what consumers want.

 

Research issues

Research issues

There are a number of different issues that an organization can choose to research. Research on the consumer marketplace can be used to determine who is buying a specific product. Companies should also consider conducting research regarding competitors’ products and services as it can provide valuable information on how a business can improve.

 

For example, organizations should analyze their customers’ perception of competitors, as such research helps to determine whether companies should add to their own products any of the benefits provided by competing products.

 

Market research can determine the composition of the current customer segment. Consumer research can examine customers’ reasons for purchasing and is critical to both increasing the current market segment and finding new target markets.

 

Distribution research is conducted to determine if the product is being sold at the right locations. Organizations also need to use research to determine if a specific product has the benefits that consumers desire.

 

Another important area of research is determining if a product is being effectively promoted. Lastly, determining the correct price for a product can make the difference between a successful and unsuccessful product launch. Information gathered on all of these issues will help businesses to learn where and how they need to improve.

 

The Research Process

Research Process

Too often, when a company conducts research it begins without proper planning. However, the chances of finding the correct answer to a research question are greatly increased by following a specific six-step process. The process starts with determining what the organization needs to know and where it can find the information.

 

In addition, researchers must determine who will participate in the research and the number of participants that will be needed. Researchers must then decide what research approach is appropriate for the research question and must choose the most suitable research method.

 

They must then plan the process of conducting the research. After the research is conducted, the final step will be to analyze and report the findings and recommendations.

 

Determine the research question

The first step, designing the research question, is generally difficult and time-consuming. Because organizations are often in a hurry for answers, the temptation is to start the research process before determining what they really need to know. As a result, they may either ask a poorly defined research question or even the wrong question entirely.

 

To be effective, a research study must be both well designed and narrowly focused. If the research question is too broad, too much information will be obtained.

 

In addition, the large amount of resulting data will be difficult to analyze and, therefore, of little use to an organization. Even worse, if the wrong question is asked, the wrong information will be obtained and all the research effort will be wasted.

 

Sources of information

information

Researchers need to put considerable thought into planning the sources from which information can be obtained. The different sources for data are categorized as secondary (data that already exist because it has been collected by someone else) and primary (data that the researcher collects).

 

In addition, secondary data can be categorized as internal (which the company already has) and external (which must be gathered from other sources).

 

Sometimes, an organization may even have already collected enough data to answer their question. In other cases, the answer to a research question might already be available as a result of research conducted by other organizations. However, even if a research question is not answered, collecting secondary data can help with the design of a primary research method.

 

A researcher will collect primary data directly from participants to answer a specific research question. Primary data are usually collected from a group of participants called a ‘sample’. This sample consists of selected members from an entire group of individuals, which is called a ‘population’.

 

These selected members can be defined by demographic characteristics such as age, gender, or occupation. They also might be defined by psychographic characteristics such as lifestyle or opinions. In addition, they can be defined by their geographic location or product usage levels. A description of the individuals in the sample is called the ‘participant profile’.

 

The method used to choose the individuals that will be included in a sample will differ depending on what type of research methodology will be used. Probability sampling is used to randomly select the people in a sample. Nonprobability sampling is utilized when the judgment of a researcher is used to make the selection.

 

The population being studied could be current customers who frequently purchase a product with the purpose of determining how a company can improve that product’s design. Past customers could be included in the sample to find sources of consumer dissatisfaction or to determine what other competing products they also purchase.

 

Rather than current or past customers, potential market segments of interest to that company can also be studied. For example, research can be conducted to determine what type of promotion might motivate older consumers to purchase.

 

Another purpose of researching a sample of potential consumers is to determine how a product needs to be adapted to offer the features and benefits they desire.

 

For example, a company that produces camping equipment might include in their sample individuals who are interested in extreme sports in order to learn how to adapt their product to meet these consumers’ preferences.

 

Choose the research approach

Choose

The next step is to choose a research approach. The process of conducting primary research starts with deciding whether the research question calls for descriptive, exploratory or causal research. The choice will depend on whether or not a research question needs to be answered with quantifiable facts.

 

If a research question asks ‘How many?’ or ‘Which one?’, the descriptive or causal research will probably be used. If a research question asks the question ‘Why?’, then exploratory research will probably be used.

 

Understanding how an organization plans to use the information will also help in making an appropriate decision. If an organization wishes to prove a fact about the demographic composition of its customers, such as how many females as compared to males purchase a product, then a descriptive study would be appropriate.

 

If, on the other hand, an organization wishes to discover why sales are falling, it will need to conduct exploratory research. The causal research will help determine the effect of a proposed change.

 

Planning the research method

Planning

After choosing the research approach, researchers must design the research method. This will include the details of how the research will be conducted, including when, where and by whom.

 

The available research methods will include surveys, focus groups, interviews, projective techniques, observation, ethnography, and grounded theory. A research plan will include the timeline for the research, the people needed and the budget.

 

For example, this step may involve writing survey questions or the script to be used in a focus group. The more detailed the planning, the more smoothly the research will proceed. Therefore everything, from the layout of the survey form to who will be responsible for ensuring that the focus group participants arrive, should be considered.

 

Conducting research and reporting findings and recommendations

Finally, researchers will be ready to conduct the research. Once done, the final task is for researchers to analyze the data and report the findings and conclusions. Analysis requires repeatedly going over the collected responses to find common themes, patterns and connections. Reporting may be in the form of a written report, a verbal presentation, or both.

 

A written report presenting the results of a quantitative research study will usually have an introduction followed by a description of the methodology. It will also have a section with findings supported with statistics and charts.

 

These findings will be the basis of the recommendations given in the report. With quantitative research, someone who has not conducted the research can still write the report based on the findings.

 

A report for a qualitative research study will follow the same outline. However, because there are no statistics or charts different types of visuals will be used to help clients understand the findings.

 

Some tools that can be used include diagrams, quotes, photos, and even videos. With qualitative research, the person who conducted the research must be involved in the writing of the report.

 

Even Nonprofits Need to Conduct Marketing Research

Nonprofit organizations, whether they are social service agencies or museums, also should consider conducting marketing research. They often respond to this fact by explaining that doing so would be too difficult and too expensive. Here are two easy and inexpensive ideas that they could implement.

 

Observation Research:

Observation Research

Nonprofits can train their staff to talk to the public who come through their doors. How did they hear about the organization? What do they like about the services provided? Have they encountered any problems?

 

Mystery Shopper:

With this method, someone from outside the organization is asked to visit the organization. After the experience, they could be asked about the ease of making an appointment or buying a ticket, for example. They could also be asked how they would rate the customer service they received.

 

Using these simple methods can improve the service, which will result in happier clients and audiences!

Question: Can you think of another way that nonprofits can easily conduct research?

 

Research Approaches

Research Approaches

One of the questions that an organization must decide before conducting research in which research approach will be most appropriate. The approach chosen will depend on the research question and the type of information a company is seeking. As noted earlier, there are three general research approaches: descriptive, exploratory and causal.

 

Each can be considered as being similar to a different type of toolbox. Each approach ‘box’ contains certain tools or methods that are most useful with that approach. After deciding on the research approach, the company will choose the best method.

 

For example, if a car needs repair a person will open the automotive toolbox and perhaps select a wrench. If a house needs repair, a carpentry toolbox will be opened and a hammer may be selected as the needed tool. Each toolbox will have a choice of tools that will be needed for a specific type of job.

 

Descriptive research

A company will perform descriptive research when it needs to obtain specific details on its consumers and their purchasing behavior. Descriptive research is used when statistical data are needed on a fact.

 

The tool used to conduct descriptive research is almost always surveys. The advantage of a survey is that, if the number of people surveyed (the sample) is large enough, it can be said that a fact has been proved and is true of the entire group.

 

Descriptive survey data can give answers such as ‘37 percent of our customers are over the age of 55’ or ‘52 percent of our customers purchase four times a year’. If the number of people asked to complete the survey is large enough compared to the total population under study, the answer can even be said to have been proven.

 

Conducting descriptive research can be expensive and time-consuming. However, it is necessary if a company wants to prove a guess or hypothesis about consumers or their behavior.

 

For example, a descriptive study can be designed to prove that ‘10 percent of all current consumers will purchase the more expensive new product model’. This guess or hypothesis can be proved within a certain level of confidence that the answer obtained from the descriptive survey sample is true of the entire population.

 

However, descriptive research can also be used to obtain details without relying on statistical proof. Descriptive research is sometimes used to address issues that are just beginning to be explored, such as consumer preferences.

 

Many organizations have relied heavily on surveys as their only means of market research. This is unfortunate as the type of information that surveys can provide is limited. Yet another reason for rethinking this dependence on descriptive surveys is that it is increasingly difficult to find a sufficient number of people who are willing to respond.

 

Because people are often pressed for time, and also because of privacy issues, it is difficult to motivate people to respond to a survey. In an effort to make participation in a survey more convenient, email and social media are increasingly being used.

 

Exploratory research

Companies should use exploratory research when a research question deals with finding information on consumer attitudes, opinions, and beliefs. Such exploratory research can be useful even when there is no specific problem to investigate.

 

For example, a company might use exploratory research to look for marketing opportunities by researching trends or changes in consumer behavior. The research methods available to conduct exploratory studies include focus groups, interviews, projective techniques, observation, ethnography, and grounded theory.

 

All of these methods use a qualitative research approach. Exploratory research is designed to let participants provide their own answers. The research question, rather than asking for facts, focuses on a consumer’s needs, desires, preferences, and values.

 

Because so many different answers will result, statistically provable answers cannot be generated, but exploratory qualitative studies, is designed with considerable thought as to what information is wanted and how it is to be obtained, can provide invaluable information to a company.

 

Such a study may be large and complex or it can be conducted on a small scale. Either way, the consumer information received will provide details and insights that will help an organization adapt its product, price, promotion, and distribution to meet consumer desires.

 

When using exploratory research tools, the emphasis is not on the size of a sample. Instead, it is about choosing the correct participants and the analysis of the information they provide.

 

For example, if asked why they purchase a company’s product, even if each individual has a unique answer, common themes will almost always appear.

 

A researcher will analyze the responses and then group them by these common themes. One advantage of qualitative research is that it can also be approached in low-cost ways that are available to even small businesses.

 

Causal research

Causal research

If a company wants to study the effect a change in its product will have on consumer purchasing or the possible success of a new promotional campaign, it should use causal research. Causal research is conducted to discover whether the change a company is planning to make will have a positive or negative effect on consumers.

 

Research questions that require causal research have a cause and effect – for example, such questions as ‘Will a new promotion campaign using a celebrity increase purchases of books among young people?’

 

or ‘Will customers at the cinema purchase more refreshments if we have a new menu?’ These issues can also be explored using experimental research. Even the effect of intangible factors on sales, such as smell and sound, can be researched.

 

If the change has already happened, internal quantitative data might already exist to answer the question. For example, if a company wants to know whether their new menu has increased sales, it can look at the sales figures. However, this is an expensive way to learn whether a new menu has proved successful.

 

A better use of research would be to use qualitative research tools before implementing the change. 

 

For example, experimenting by trying the new menu on a small scale first, to see whether customer reaction will be positive or negative. Such experiments should be carefully designed using the proper subjects and an impartial research design so that the results will be accurate.

 

Research Methods

Research Methods

Once the general approach is understood, the next step will involve choosing a research method and then plan the research. Marketing research methods can be divided into two different types – quantitative and qualitative. For a small study, research methods of only one type might be used.

 

However, for some large-scale studies, both types of research may be needed. Quantitative research uses mathematical analysis to provide proof of a fact or a hypothesis (guess or assumption).

 

When properly implemented, quantitative research can answer questions such as ‘How many consumers prefer our new product?’ or ‘Which of these three packaging designs is most attractive to consumers?’

 

The standard tool used when conducting quantitative research is the survey. Survey questions give participants a selected number of responses such as yes/no or frequently/sometimes/never. The responses are then entered into a computer using a statistical software package.

 

The software will tabulate if there are enough responses to support a ‘proved’ fact. This proved fact is then said to be true of the group of consumers as a whole (population) even though only a selected number (sample) were asked.

 

Of course, it is impossible to ask all consumers. Therefore, it is necessary to determine how many people should participate in the quantitative survey to support this proof.

 

To determine the correct number, researchers use their knowledge of sampling and statistics to construct a sample that contains the required number and type of participants.

 

This proof of consumer behavior is important when a company is planning a major expenditure, such as the introduction of a new product or a new promotional campaign.

 

While quantitative studies can be expensive, because they must be conducted with a large enough sample, in some situations they are worth the cost. The cost is acceptable because if the wrong decision is made, even more, money could be lost.

 

Quantitative vs. qualitative research

qualitative

While quantitative studies are useful for answering questions such as ‘How many?’ and ‘What?’, they are not as useful when answering questions such as ‘Why?’ or ‘What if?’

 

A qualitative study is designed to uncover consumer attitudes, beliefs, and opinions rather than facts. Because it is difficult to know consumer preferences before the study is conducted, a quantitative survey form with predetermined answers can result in misleading results.

 

Instead, a wider variety of qualitative research tools, including interviews, focus groups, observation, and projective techniques, is available. These tools, when used by trained researchers, allow participants to fully express their opinions and beliefs.

 

Qualitative research uses fewer participants, who are not necessarily representative of all consumers in the population; sometimes they are chosen because they belong to a distinct segment, such as older or ethnic consumers.

 

The data that result from using a qualitative approach is not in the form of statistics but rather in ideas and quotes expressed by participants and researchers’ notes.

 

Interpretation of the data requires special skills but correctly analyzed qualitative data can provide a rich source of information for marketing ideas including new concepts for segmentation. Social media content can now be used as a data source for consumer research. The interpretation of these data requires special skills.

 

What Should You Write About?

Write

Content marketing provides information that is useful and interesting to a company’s target market in the hope that this will then generate interest in the product. But how do you know what your target market will find interesting?

 

One way to do this is to sign up for newsletters from your competitors to which your target market might subscribe, as these will let you know what they like to read.

 

If you are selling a pet care product, sign up for any animal-related newsletters. If you notice that many contain articles about pet food that is organic, then you have an idea for a subject on which you can write. Another way is to follow

 

Twitter users who are interested in a topic and watch to see what content they are sharing. By posting similar content with your company name attached there is a chance that it will also be shared.

 

Data collection methods

Once a research question has been decided upon and the research approach has been chosen, the next step is to choose a research method. Methods can include the traditional quantitative marketing survey used in descriptive research.

 

There are more research tools available for conducting qualitative exploratory research, including focus groups, interviews, projective techniques, observation, and netnography. 

 

Surveys

Surveys are written instruments that ask a series of predetermined questions. These questions can be answered by checking one of several suggested answers, or the questions might be open-ended and will allow participants to answer in their own words. Surveys can be administered in several ways including in person, over the phone, by mail or online.

 

The benefit of conducting a survey is that a researcher can tabulate and compare responses as the same questions are asked of each participant. Because the questions and answers are standardized, if enough survey responses are collected, it can be said the response is true of an entire group.

 

Technology has changed the way surveys are conducted, with an increasing percentage now being done on cell phones.

 

There are disadvantages to the survey method. A well-written survey will take time to develop as the questions must be carefully written so that there is no ambiguity as to what they mean.

 

To ensure this, a survey form must be tested on sample participants before it is widely distributed. If a large number of responses are received it will be necessary to use a computer database program to record the answers. In addition, it is becoming more difficult to motivate participants to complete a survey form.

 

Surveys Now Start on a Smartphone

Smartphone usage continues to grow. In fact, from 2015 to 2021 it is predicted that smartphone usage will double globally to 6.4 billion. It is not surprising that as the smartphone has become an indispensable tool for many people, researchers have wanted to understand how it could be used to conduct research.

 

It was found that of all online surveys, almost 30 percent were started on a smartphone. This means that any online survey must be created so that it can be easily assessed and responded to on a phone.

 

It was also found that people are more likely to open and complete a survey on their phone than when they are on their computer. But the survey must be designed with small screen use in mind.

 

Question: What design issues need to be considered for surveys being completed on a phone?

 

Focus group

Focus group

A focus group brings together a group of individuals, who are then encouraged to share their opinions and concerns.

By putting people together in a focus group, they can be encouraged to respond to each other’s comments and go beyond their initial response to a question. It is the focus group moderator’s responsibility to keep the discussion on track and encourage responses.

 

A formal focus group is usually conducted by an outside professional moderator. Using researchers who work for the organization as moderators are not considered a good idea, as they might introduce preconceived ideas into the focus group process.

 

Focus groups are a method that can be successfully used even by small businesses and nonprofit organizations. Even if they cannot afford a focus group that is planned and conducted by a professional researcher, an organization will still obtain valuable information by asking a few of its customers to participate in an informal focus group.

 

The person moderating the focus group does not need to be a professional marketing researcher but does need basic skills in listening and human relations. Often graduate students from a nearby university can be used for this purpose. The role of the moderator is to be noncommittal and objective and to listen and record what the participants say.

 

What is critical is that the moderator guides the conversation by encouraging the participants to keep their comments focused on the subject, while not guiding the opinions expressed.

 

Interviews

Interviews

Interviews can be one of three types – in-depth, intercept or expert. In-depth interviews are used to obtain information on how a participant feels about an issue. The advantage of this method is that the interviewer has time to explore an individual’s first response to a question with additional, probing, follow-up questions.

 

These allow the researcher to obtain more in-depth information. The follow-up questioning is necessary because when first asked a question many people will respond with what they believe to be the correct, or appropriate, answer. Also, most people want to be polite by answering in the affirmative and with positive praise whenever possible.

 

The disadvantage is that interviews take considerable time, and therefore money, to conduct. Also, since each interview takes time fewer can be conducted.

 

Intercept interviews are often called ‘person-on-the-street’ interviews. They are designed to be short, taking only three to five minutes, and are limited to a specific topic.

 

To conduct the interviews a researcher will go to a location where participants can be found. The advantage of intercept interviews is that many responses can be collected in a short period of time. The disadvantage is that the method leaves no time for probing follow-up questions.

 

In addition, a researcher can conduct expert interviews. The participants in these interviews are not potential or current consumers but rather individuals who have specific knowledge. This knowledge will involve the industry as a whole or knowledge about a company’s target market segment.

 

Projective techniques

Projective techniques can be incorporated in both interviews and focus groups to encourage communication or they can be used on their own. These are techniques that obtain information in ways other than a verbal response.

 

The technique is borrowed from psychology and is gaining increased use in consumer marketing. Some simple projective techniques include word association, sentence completion and cartoon tests. These are also tools that creative people working in marketing should enjoy using.

 

Word association is simply asking for a participant’s first response to a name, photo or event. The idea is to get emotional responses, rather than intellectual thoughts, about a company, brand name or product. Word association can be used in focus groups or interviews to get respondents to communicate on an emotional rather than intellectual level.

 

Observation

Another research method that can be used by all types of organizations is observation. This is an inexpensive qualitative method that can be easily adopted by small businesses and community nonprofits.

 

If a business wants to know how its customer service desk is being used, it can station researchers to watch and then note the behavior of customers as they seek assistance. A museum can use observational research to track the actions of specific groups of visitors.

 

For example, families or single people can be observed to help the museum to determine which galleries are most visited, the length of a stay and what displays attract the most attention.

 

This method will often give more accurate information than surveying, as most people do not keep track of what they do while shopping in a store or when visiting a museum.

 

Netnography

Ethnographic research studies the daily lives of participants. The research can be conducted where participants live, where they shop and where they work. Ethnographic research does not rely on people’s responses but instead studies what they actually do.

 

Ethnography requires researchers skilled in observing and interacting with people on a participant, rather than a research, level. Often such researchers have a background in anthropology, which helps them to understand and adapt to various cultures.

 

The ethnographic research study is designed to study actual product purchase or use experience. To do so, researchers will use photos, videos, journals or participant observation.

 

For example, they may record the actions of families as they prepare dinner. One insight that might be discovered is that some children may want to be involved in food preparation. From this insight might come a new promotional campaign showing children and adults cooking together.

 

One of the new uses of social media for research is netnography. Netnography is a new form of an ethnography where the researcher spends time embedded in the social and cultural world of those being studied. In ethnography, the researcher traveled to the location where the research was undertaken, often a distant part of the world with cultural differences.

 

Not only would individuals be studied but also the reactions between individuals and between individuals and the environment would be observed. With the development of technology, the idea of virtual ethnography, or netnography, has developed.

 

Rather than the research studying people who live in a specific location, the connection between individuals is studied while they are online, no matter their physical location.

 

While some details as to how people look and react are lost, other less obvious relations may become apparent. Netnography uses online technology to study relationships that take place only as virtual relationships.

 

Summary

1. Research can answer fundamental questions that affect the future of any organization. For this reason, even small businesses and nonprofit organizations should conduct research. It can answer questions about the external environment including consumer segments and competitors.

 

Of course, an organization should always research a consumer’s motivation for purchasing a product. The organization may also need to research the components making up the marketing mix, which includes product, promotion, price, and distribution.

 

2. Research is most successful when it is planned using the six steps in the research process. The process starts with determining the research question and deciding on the source of information and the sample.

 

Next, a researcher will choose the research approach and plan the research method. Finally, they will conduct the research and analyze and report the findings.

 

3. Descriptive, exploratory and causal research methods each have specialized uses. Descriptive is best when details are needed, exploratory when seeking insight, and casual when it is important to understand the effect of a change.

 

4. Quantitative and qualitative research approaches each have their uses. Quantitative research is based on scientific methods and can provide proof, while qualitative is based on social science methods and provides in-depth information on attitudes and beliefs.

 

The standard research tools are surveys, interviews, focus groups, projective techniques, observation and netnography. This blog has given a brief description of each of these, although in future chapters more detail will be provided.

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