Defining the Problem and Determining Research Objectives

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Defining the Problem and Determining Research
Objectives
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Differences Between Managers and Researchers

• Marketing managers and researchers see the world
  differently because they have different jobs to
  perform and their backgrounds differ markedly.

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Differences Between Managers and Researchers
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Define the Marketing Managers Problem Questions
Researchers Should Ask

• Discussions often take place between managers and
  researchers to determine the problem.
  Researchers should ask questions relating to
• Symptoms of the problem?
• Managers situation (history, products, mission,
  customer information, managers objectives,
  etc.)?
• Suspected causes of the problem?

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Define the Marketing Managers ProblemQuestions
cont.

• Possible solutions to the problem?
• Anticipated consequences of tentative solutions?
• Managers assumptions about existing conditions
  and what will take place if solution is carried
  out?
• Adequacy of info on hand to specify research
  objectives (quantity, quality of info)

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Decide When Marketing Research Is Warranted

• Four conditions when marketing research should
  likely be undertaken
• If it clarifies problems or investigates changes
  in the marketplace that can directly impact your
  product responsibility
• If it resolves your selection of alternative
  courses of marketing action to achieve key
  marketing objectives
• If it helps you gain a meaningful competitive
  advantage
• If it allows you to stay abreast of your markets

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Online Research and Problem Definition

• Managers sometimes must act fast, Online research
  could help
• Positive Outcome Online systems aid in the
  process because information systems speed
  information delivery
• Negative Outcomes
• 1. Information Overload or
• 2. Online environment also means that
  competitors and customers have better
  information

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Define the Marketing Management Problem and
Research Objectives

• Marketing Management Problem
• Symptoms of failure to achieve an objective are
  present. What should be done?
• Symptoms of the likelihood of achieving an
  objective are present (opportunity
  identification). What should be done?
• Marketing Research Objectives
• Providing relevant, accurate, and unbiased
  information that managers can use to solve their
  marketing management problems

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Defining the Marketing Management Problem

• Assess Managers Situation
• Background of the product/service company
  history, overall mission, marketing plans,
  managers objectives and her/his resources, etc.
• Clarify Symptoms
• Symptoms are changes in the level of key
  indicators of company success. Examples include
  changes in sales volume, market share, profits,
  or dealer orders, also complaints and/or
  competitor actions could be indicators

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Define the Marketing Managers Problemcont.

• Pinpoint suspected causes of the problem.
• Eliminating a symptom does not solve the problem.
• For every problem, an underlying cause can be
  found.
• A probable cause differs from a possible cause.
  Important to list all possibilities first.
• Specify actions that may alleviate the problem.
• Solutions include any marketing action that may
  resolve the problem.

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Define the Marketing Managers Problemcont.

• Speculate on anticipated consequences of the
  action.
• What will be the impact not only on the problem
  at hand but also throughout the marketing program
  if a specific marketing action is implemented?
• What additional problems will be created if a
  proposed solution to the current problem is
  implemented?

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Define the Marketing Managers Problemcont.

• Identify the managers assumptions about the
  consequences.
• Assumptions are beliefs that certain conditions
  exist or that certain reactions will take place
  if the considered actions are implemented.
• Assumptions are the glue that holds the decision
  problem parts together.
• Research may help eliminate or lessen a managers
  uncertainty.

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Define the Marketing Managers Problemcont.

• Assess the adequacy of information on hand to
  specify research objectives.
• Information State quantity and quality of
  evidence a manager possesses for each assumption
• Information Gaps discrepancies between the
  current information level and the desired level
  of information at which a manager feels
  comfortable resolving the problem at hand
• Manager and researcher come to agree on research
  objectives based on the information gaps.

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Examples

• MANAGEMENT PROBLEM
• New package design for an existing product
•  Increasing store traffic
•  
•  Launching a new product
•  
• Determining the position of Boyner department
  stores among its equivalents,
• Changing price strategy
• Should we launch a new advertising campaign?

• MARKETING RESEARCH PROBLEM
• Evaluating the effectiveness of alternative
  packages
• Measuring current store image
• Designing a test market
• SWOT analysis for Boyner,
• Determining the factors for leadership in
  the department stores sector
• Determining demand elasticity
• What is the impact of different prices on
  sales and profit?
• Determining the effectiveness of the current
  advertising programme

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Diagnosing the Problem

• CBWe are losing market share in corporate
  banking
• R Is it only happening in Istanbul?
• CB No, it isnt. But we are more concerned since
  it is the city we have the largest transaction
  volume.
• R Why do you think you are losing market share?
• CB I wish I had known.....
• R How are your competitors doing?
• CB The other banks have similar problems too.
  However, foreign banks are gaining more market
  share.
• R How do your clients evaluate the service
  quality?
• CB We are very proud of the ISO9000
  certificate that we recently got.
• R Very good. However, how do you evaluate your
  service quality compared to your competitors?

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Example (cont.)

• Specifically the following information is
  required
• 1. Which criteria the firms use when they are
  choosing a corporate finance banking service for
  the first time?
• 2. How do the firms allocate their financial
  service purchase among different banks?
• 3. Which services do the firms buy from local and
  European banks?
• 4.  How do the firms evaluate local and European
  banks service quality?
• 5. What is the market share of X bank in Ireland
  compared to its competitors?
• 6. What is the profile of X banks clients? How
  are they different from other banks clients?

 
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Analytic Model

• Analytic model defines the relationships among
  several variables as a process
• Or as parts of a bigger model,
• It can be verbal, mathematical or graphical
• They serve as a basis for the research design and
  used as a guide for the rest of the research

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Example
Behavioural Loyalty
Emotional Attachment
H5a
H3
H1a
H5b
Purchase/ Repurchase Intention
H2
Other Customers Effect
Corporate Image
H5c
Consumer-company Identification
Customer Extra-Role Behaviours
H4
H1b
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Figure 2.5 Development of research questions and
hypotheses
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The Role of Theory in Marketing Research
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Marketing Research QuestionsExamples

• Determining psychographic profile of department
  store customers
•  
• What is the level of store loyalty of customers?
  
• What sort of activities the customer engage in
  after the purchase?
• What shopping means to customers other than
  getting what is needed?

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Operationalized Definitions

• How can we understand when store cards or credit
  cards are used for transaction?
• Do the customers have store cards?
• How frequently do the customers use store cards?
• What is the amount of purchase with the store
  cards in a specific period of time?

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Hypotheses

• Hypothesis is a statement that asserts the
  assumed (but not supported in reality yet)
  relationships between the variables of interest
• Examples
• H1 The loyal customer are more aware than less
  loyal ones in terms of store atmosphere
  qualities.
• H2 The loyal customers are more willing to bare
  risk in purchase than less loyal ones. 

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Example

• The Factors Affecting Purchase Intention
• Brand awareness and Brand trust
• General Problem Definition-Aim of the Research
• What can affect purchase intention?
• ?
• Preliminary Literature Review
• ?
• Objectives
• ????
• ?
• Depth Literature Review
• Trust has two aspects
• Trust on the basis of prior knowledge
• Trust at the time of decision-making

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Main Variables

• Attitude Towards Brand
• Trust about the brand
• Attitude towards other brands
• Awareness about the brand
• Purchase intention

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Operationalised Definitions

• Brand awareness The degree of prior awareness
  while asserting a preference
• Trust The degree of self-assurance while
  evaluating the brand and other brands
• Attitude The degree of liking or satisfaction
  about the preferred brands
• Purchase intention The degree of likelihood of
  buying the same brand in the next ten shopping
  exercises.

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Hypotheses

• H1 The more the brand awareness, the more the
  prior-knowledge based trust about that brand.
• H2 The consumers positive attitude towards a
  brand is positively affected by brand awareness.
• H3 There is a positive relationship between
  purchase intention and prior-knowledge based
  trust
• H4 The purchase intention of a consumer is
  positively affected by attitude toward the brand
  but is negatively affected by the attitude
  towards competing brands

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The Invitation to Bid and the Marketing Research
Proposal

• A marketing research proposal flows from an
  invitation to bid (ITB) or request for
  proposal ( RFP)
• Both define the marketing management problem
• Both specify the research objectives
• The bid details the research method proposed by
  the researcher to accomplish the research
  objectives

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The Invitation to Bid and the Marketing Research
Proposal

• The problem statement for both identifies
• the company, division, or principals involved
• the symptoms
• the possible causes of the symptoms
• the anticipated uses of the research information
• The research proposal ensures that the researcher
  and the manager see the problem in the same way.

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The Invitation to Bid and the Marketing Research
Proposal

• The proposal itemizes the information objectives
  agreed by the manager and researcher.
• Constructs and operational definitions are
  specified.
• A construct is a marketing term or concept that
  is involved in the marketing management problem
  (e.g. brand awareness, product knowledge,
  attitude, loyalty, satisfaction).
• An operational definition describes how the
  researcher will measure a construct.

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Formulate the Marketing Research
ProposalTranslate the Research Objectives to Be
Researchablecont.

• Relationships are identified.
• A relationship is a meaningful link believed to
  exist between two constructs (lower price is
  related to greater sales, higher exposure is
  related to greater awareness, etc.).
• A model is decided.
• A model connects constructs with understandable
  logic

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The Invitation to Bid and the Marketing Research
Proposal

• The proposed research method identifies data
  collection mode, questionnaire design, sample
  plan, and other aspects of the anticipated
  marketing research.

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Figure 2.1 Components of the marketing research
brief
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The Marketing Research Report

• Executive summary
• Background
• Problem definition
• Research objectives
• Research design
• Fieldwork/data collection

• Data analyses
• Recommendations
• Cost and timetable
• Research organisation and researchers
• Appendices
• Agreement

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Research Design
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Research Design

• The research design is the master plan specifying
  the methods and procedures for collecting and
  analyzing the needed information.

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Types of Research Design

• Although every problem and research objective may
  seem unique, there are usually enough
  similarities among problems and objectives to
  allow decisions to be made in advance about the
  best plan to resolve the problem.
• There are some basic marketing research designs
  that can be successfully matched to given
  problems and research objectives.

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Types of Research Design

• Three traditional categories of research design
• Exploratory
• Descriptive
• Causal
• The choice of the most appropriate design depends
  largely on the objectives of the research and how
  much is known about the problem and these
  objectives.

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Research Design Some Observations

• The overall research design for a project may
  include one or more of these three designs as
  part(s) of it.
• Further, if more than one design is to be used,
  typically we progress from Exploratory toward
  Causal.

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Basic Research Objectives and Research Design
Research Objective Appropriate Design
To gain background information, to define terms,
to clarify Exploratory problems and develop
hypotheses, to establish research priorities,
to develop questions to be answered To describe
and measure marketing phenomena at a
point Descriptive in time To determine
causality, test hypotheses, to make if-then
Causal statements, to answer questions
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Research

• Quantitative research research involving the use
  of structured questions in which response options
  have been predetermined and a large number of
  respondents are involved
• Qualitative research collecting, analyzing, and
  interpreting data based on what people do and say
  with smaller samples
• Pluralistic research combination of both
  quantitative and qualitative research methods in
  order to gain the advantages of both

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Research Design Exploratory Research

• Exploratory research is most commonly
  unstructured, informal research that is
  undertaken to gain background information about
  the general nature of the research problem.
• Exploratory research is usually conducted when
  the researcher does not know much about the
  problem and needs additional information or
  desires new or more recent information.

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Research Design Exploratory Research

• Exploratory research is used in a number of
  situations
• To gain background information
• To define terms
• To clarify problems and hypotheses
• To establish research priorities

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Research Design Exploratory Research

• A variety of methods are available to conduct
  exploratory research
• Secondary Data Analysis
• Experience Surveys
• Case Analysis
• Focus Groups
• Projective Techniques

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Observation, Focus Groups, and Other Qualitative
Measures
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Observation Techniques

• Observation methods techniques in which the
  researcher relies on his or her powers of
  observation rather than communicating with a
  person in order to obtain information
• Types of observation (will explain later)
• Direct versus indirect
• Disguised versus undisguised
• Structured versus unstructured
• Human versus mechanical

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Observation Techniquescont. Direct versus
Indirect

• Direct observation observing behavior as it
  occurs
• Indirect observation observing the effects or
  results of the behavior rather than the behavior
  itself
• Archives (written records)
• Physical traces (erosion or accumulation/accretion
  )

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Observation Techniquescont. Disguised versus
Undisguised

• Disguised observation subject is unaware that he
  or she is being observed
• Undisguised observation respondent is aware of
  observation

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Observation Techniquescont. Structured versus
Unstructured

• Structured observation researcher identifies
  beforehand which behaviors are to observed and
  recorded
• Unstructured observation No restriction is
  placed on what the observer would note all
  behavior in the episode under study is monitored

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Observation Techniquescont. Human versus
Mechanical

• Human observation person or persons observe
  behavior (person hired by the researcher,
  clients, or perhaps the observer is the
  researcher)
• Mechanical observation human observer is
  replaced with some form of static observing
  device(audio and or visual recording)

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Observation Techniquescont. Appropriate
Conditions for the Use of Observation

• Short duration
• Public
• Faulty recall (difficult for person to remember
  accurately what was done) conditions
• Person is unaware of behavior

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Observation Techniquescont. Advantages of
Observational Data

• Insight into actual, not reported, behaviors
• No chance for recall error
• Better accuracy (versus self-reporting)
• Less cost

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When to Use?

• Limited information about the market conditions
• When new insights are needed
• To understand customer behaviour
• To understand what motivated customer
  satisfaction and
• to discover customer habits, jargon, myths,
  desires and
• expectations

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Examples

• Technology and media usage at home
• Setting a brand community
• Sub-cultural consumption habits and behaviours

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Activities Involved

• Dairy keeping
• Recording behaviour, daily routine and opinions
• Video and photographs
• Providing those to support their oral or
  behavioural actions
• Projective techniques
• Online observation

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Example

• Subject
• Hygenic and cosmetic products usage among
  Americans, English and Turks
• Sample characteristics Moderate and Intensive
  users
• Methodology
• Taking pictures of the products at their location
  and asking respondents to describe the photos
• Keeping dairy about their daily usage of these
  products
• Describing their shopping experience about those
  products in detail
• Keeping health and beauty advertisements content
  analysis
• Doing in-depth interviews on the following
  questions
• How do you define beauty?
• What motivates you for dermatological health
  care?
• If your most liked dermatological product
  disappears from the market how would you feel?
• How much time do you allocate for dermatological
  health care?
• Which brands do you like most? Why?

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Observation Techniquescont. Limitations of
Observational Data

• Small number of subjects
• Can only observe short-duration, frequently
  occurring events
• Subjective interpretations (by observer)
• Inability to understand what is beneath the
  behavior observed (why was the behavior carried
  out - motivations, attitudes, and other internal
  conditions are unobserved)

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Focus Groups

• Focus groups small group (6 12 people)
  discussions led by a trained moderator
  homogeneous group tightly bounded topic area
• Objectives
• Generate ideas
• Understand consumer vocabulary
• Reveal consumer benefits sought, needs, motives,
  perceptions, and attitudes on products and
  services
• Understand findings from quantitative studies

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Focus Groups Moderators Role and Responsibilities

• Focus group moderator a person who conducts the
  session and guides the flow of group discussion
  across specific topics
• Moderator characteristics
• Experienced
• Enthusiastic
• Prepared
• Involving
• Energetic
• Open-minded

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Focus Groups Reporting and Use of Focus Group
Results

• Factors to remember when analyzing data
• Some sense must be made by translating the
  qualitative statements of participants into
  categories and then reporting the degree of
  consensus apparent in the focus groups
• Demographics and buyer behavior characteristics
  of focus group participants should be judged
  against the target market profile to assess what
  degree the group(s) represent(s) the target
  market
• A focus groups analysis should identify major
  themes as well as salient areas of disagreement
  among the participants

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Focus Groups Online Focus Groups

• Online focus group one in which the respondents
  and/or moderator (and sometimes clients)
  communicate and/or observe by use of the
  Internet group members are at their own pc
• Advantages
• No physical setup is necessary
• Transcripts are captured on file in real time
• Participants can be in widely separated
  geographical areas
• Participants are comfortable in their home or
  office environments
• The moderator can exchange private messages with
  individual participants

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Focus Groups Online Focus Groupscont.

• Disadvantages
• Observation of participants body language is not
  possible
• Participants cannot physically inspect products
  or taste food items
• Participants can lose interest or become
  distracted

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Focus Groups In General

• Advantages
• Generation of fresh ideas
• Client interaction
• Versatility (many topics, other research
  techniques may be used, product tests, etc.)
• May tap special respondents (drs., lawyers )
• Disadvantages
• Representative of the population?
• Interpretation is subjective
• High cost-per-participant (150 - 200 each)

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Other Qualitative Research Techniques

• Depth interview a set of questions with probes,
  posed one-on-one to a subject by a trained
  interviewer to gain an idea of what the subject
  thinks about something or why he or she behaves a
  certain way
• Protocol analysis involves placing a person in a
  decision-making situation and asking him or her
  to verbalize everything he or she considers when
  making a decision (step-by-step)

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Other Qualitative Research Techniquescont.

• Projective techniques involve situations in
  which participants are projected into another
  person, an inanimate object, or a simulated
  activity, with the hope that they will divulge
  things about themselves that they might not
  reveal under direct questioning.
• Types include
• Word association test
• Sentence completion
• Picture test (may include headline or
  statement)
• Cartoon or balloon test
• Role-playing activity

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Physiological Measurements

• Physiological measurements monitoring a
  respondents involuntary responses to marketing
  stimuli via the use of eye cameras, salinity
  detectors, blood pressure sensors, and other
  devices
• Pupilometer (iris dilation/contraction)
• Eye-tracking
• Galvanometer
• Voice Print Analysis (VOPAN)

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Research Design Descriptive Research

• Descriptive research is undertaken to provide
  answers to questions of who, what, where, when,
  and how but not why.
• Two basic classifications
• Cross-sectional studies
• Longitudinal studies

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Research Design Descriptive Research Cross-sectio
nal Studies

• Cross-sectional studies measure units from a
  sample of the population at only one point in
  time.
• Sample surveys are cross-sectional studies whose
  samples are drawn in such a way as to be
  representative of a specific population.
• On-line survey research is being used to collect
  data for cross-sectional surveys at a faster rate
  of speed.

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Research Design Descriptive Research Longitudinal
Studies

• Longitudinal studies repeatedly draw sample units
  of a population over time.
• One method is to draw different units from the
  same sampling frame.
• A second method is to use a panel where the
  same people are asked to respond periodically.
• On-line survey research firms recruit panel
  members to respond to online queries.

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Research Design Descriptive Research Longitudinal
Studies

• Two types of panels
• Continuous panels ask panel members the same
  questions on each panel measurement.
• Discontinuous (Omnibus) panels vary questions
  from one time to the next.
• Longitudinal data used for
• Market tracking
• Brand-switching
• Attitude and image checks

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Research Design Causal Research

• Causality may be thought of as understanding a
  phenomenon in terms of conditional statements of
  the form If x, then y.
• Causal relationships are typically determined by
  the use of experiments, but other methods are
  also used.

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Experiments

• An experiment is defined as manipulating
  (changing values/situations) one or more
  independent variables to see how the dependent
  variable(s) is/are affected, while also
  controlling the affects of additional extraneous
  variables.
• Independent variables those over which the
  researcher has control and wishes to manipulate
  i.e. package size, ad copy, price.
• Dependent variables those over which the
  researcher has little to no direct control, but
  has a strong interest in testing i.e. sales,
  profit, market share.
• Extraneous variables those that may effect a
  dependent variable but are not independent
  variables.

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Experimental Design

• An experimental design is a procedure for
  devising an experimental setting such that a
  change in the dependent variable may be solely
  attributed to a change in an independent
  variable.
• Symbols of an experimental design
• O measurement of a dependent variable
• X manipulation, or change, of an independent
  variable
• R random assignment of subjects to experimental
  and control groups
• E experimental effect

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Experimental Design

• After-Only Design X O1
• One-Group, Before-After Design O1 X O2
• Before-After with Control Group
• Experimental group O1 X O2
• Control group O3 O4
• Where E (O2 O1) (O4 O3)

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How Valid Are Experiments?

• An experiment is valid if
• the observed change in the dependent variable is,
  in fact, due to the independent variable
  (internal validity)
• if the results of the experiment apply to the
  real world outside the experimental setting
  (external validity)

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Types of Experiments

• Two broad classes
• Laboratory experiments those in which the
  independent variable is manipulated and measures
  of the dependent variable are taken in a
  contrived, artificial setting for the purpose of
  controlling the many possible extraneous
  variables that may affect the dependent variable
• Field experiments those in which the independent
  variables are manipulated and measurements of the
  dependent variable are made on test units in
  their natural setting

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Test Marketing

• Test marketing is the phrase commonly used to
  indicate an experiment, study, or test that is
  conducted in a field setting.
• Two broad classes
• To test the sales potential for a new product or
  service
• To test variations in the marketing mix for a
  product or service

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Types of Test Markets

• Standard test market one in which the firm tests
  the product and/or marketing mix variables
  through the companies normal distribution
  channels
• Controlled test markets ones that are conducted
  by outside research firms that guarantee
  distribution of the product through prespecified
  types and numbers of distributors

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Types of Test Marketscont.

• Electronic test markets those in which a panel
  of consumers has agreed to carry identification
  cards that each consumer presents when buying
  goods and services
• Simulated test markets those in which a limited
  amount of data on consumer response to a new
  product is fed into a model containing certain
  assumptions regarding planned marketing programs,
  which generates likely sales volume

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Test Markets

• Test marketing is used in both consumer markets
  and industrial or B2B markets as well.
• Lead country test market test marketing
  conducted in specific foreign countries that seem
  good predictors for an entire continent

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Criteria for Selecting Test Market Cities

• Representativeness Do demographics match the
  total market?
• Degree of isolation Phoenix and Tulsa are
  isolated markets Los Angeles is not isolated.
• Ability to control distribution and promotion
  Are there preexisting arrangements to distribute
  the new product in selected channels of
  distribution? Are local media designed to test
  variations in promotional messages?

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Test Marketing

• Pros
• Allows most accurate method of forecasting future
  sales
• Allows firms the opportunity to pretest marketing
  mix variables
• Cons
• Does not yield infallible results
• Are expensive
• Exposes the new product or service to competitors
• Takes time to conduct