Marketing Research Methods

Nishan Navaratne
Definition

– Marketing research is the systematic design,

collection, analysis and reporting of data and
findings relevant to a specific marketing
situation facing the company.”
– Marketing research is the process of designing,
gathering, analyzing, and reporting
information that may be used to solve a specific
marketing problem.

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Learning Outcomes

 To learn the steps in the marketing

research process.
 To understand how the steps in the
marketing research process are
interrelated and that the steps may not
proceed in order.
 To be able to know when market
research may be needed and when it
may not be needed.
 To know which step is the most
important in the marketing research
process.
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Why Marketing Research
• Why do businesses need accurate and up-to-date
information?

– To undertake marketing effectively

– Changes in technology
– Changes in consumer tastes
– Market demand
– Changes in the product ranges of competitors
– Changes in economic conditions
– Distribution channels

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Why Marketing Research

• Gain a more detailed understanding of

consumers’ needs:
– e.g., views on products’ prices, packaging, recent
advertising campaigns
• Reduce the risk of product/business failure:
– there is no guarantee that any new idea will be
a commercial success
– Can help to achieve commercial success
• Forecast future trends:
– it can also be used to anticipate future customer needs

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Uses

• Identify marketing opportunities and

problems
• Generate, refine, and evaluate potential
marketing actions
• Monitor marketing performance
• Improve marketing as a process
• Reduces uncertainty
• Reduces risk
• Helps focus decision making
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The Marketing research process

• Define the problem

• Define research objectives
• Choose data sources
• Choose research methods
• Construct sample
• Set budget and deadlines
• Undertake research
• Analysis and evaluation
Comments
 Few comments about the process:
1. It is rare in practice a research project
follows all the exact steps.
 Research is an interactive process where a
researcher by discovering something may move
forward or backwards in the process.
2. May not involve every step shown
 The research problem may be resolved, for
example by a review of secondary data, thereby
eliminating the need to determine a sample plan
or size.
3. What’s important is although every
research project is different, there are
enough commonalities to follow the
steps of marketing research.

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Define the problem
 Defining the problem is the single most
important step in the marketing research
process.
 Often studies are commissioned without a
clear understanding of the problem that
needs to be addressed.
 Exploratory research is needed to define the
problem so research may be conducted.
 Problem definition involves:
1. Specifying the symptoms
2. Itemising the possible causes of the symptoms
3. Listing the reasonable alternative courses of action
that the marketing manager can undertake to solve
the problem.

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Define Research Objectives

 Research objectives identify what

specific pieces of information are
necessary to solve the problem at
hand.
 Research objectives step is the
specification of the specific types
of information useful to the
managers as they grapple for a
solution to the marketing problem
at hand.

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Methods of collecting data

• Desk Research- in which secondary data is

collected. Secondary data is defined as the
reusing of data that already exists.
• Field Research- collecting original data known
as primary data.
• Data collecting is only one stage in the
process.
• The has to be analysed and evaluated.
• Conclusions and recommendations have to be
drawn.
Choose data sources

Basically two types of data information

available to a marketing researcher:
A. Secondary data – as it name
implies, refers to information that
has been collected for some other
purpose.
B. Primary data - refers to
information that has been gathered
specifically to serve the research
objectives at hand.

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Determine sample plan and size

 A sample plan identifies who is to be

sampled and how to select them for study.
 A sample element refers to a unit of the
entity being studied.
 A sample Frame is a list from which the
sample elements are drawn for the sample.
 A sample plan specify how to draw the
sample elements from the sample plan.
 Methods are available to help the researcher
determine the sample size required for the
research study.

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Collect Data
 Data collection is usually done by trained
interviewers who are employed by field data
collection companies to collect primary data.
 Being ware of errors that may occur is
important.
 Non-sampling Errors are attributable to
factors other than sampling errors.
 Wrong sample elements to interview
 Securing participants who refuse to participate
 Not a home
 Interviewing subjects who give the wrong information.
 Hiring interviewers who cheat and fill out fictitious
survey questionnaires.

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Quantitative Research

• Statistical basis
• Gathers statistically valid, numerically
measurable data
• Usually related to the data on the market-size,
growth and market shares
• Sampling plays a key role
• Data obtained through surveys
• Conducted with obtaining hard data
Qualitative Research

• Subjective and personal

• Concerned with finding out soft information
• Main purpose is to understand consumer
behavior, attitudes and perceptions
• Obtained by methods designed to get detailed
responses e.g. interviews, focus groups
• Research topics are usually explored in some
depth
 Secondary data sources

1. Internal 2. External
• Sales figures • Competitor
• Customer information
reports • Government
• Trend data publications

• Sales report • Commercial

publications
• Cost data
• Trade association
• Company data
reports
• Retail audits
Field research to collect primary data

Quantitative
• Experiments
• Observations
• Surveys
• Interviews
Qualitative
• Focus groups
• Panels
• In-depth Interviews
 Field Research
Methods

Experiments Observation Surveys panel

under watching and interview
controlled behavior asking people
conditions
Experiments

• A method of obtaining primary research data.

• The aim is measure and evaluate customers’
reactions to changes in the marketing mix.
• Can be done under controlled conditions or in
the field.
• Examples: test markets, simulated test market,
extended user test, blind test.
• Pilot trials of new products are a common use
of experiments as it provides a chance to test
how things work out before a large scale roll-
out. It reduces risk and uncertainty.
Observation

• A data gathering approach in which information

is collected without questions being asked.
• Involves watching people behave, noting and
analysing their reactions.
• It is useful to find out how people buy products,
where they shop, what appears to interest
them.
• Can be carried out under controlled
(laboratory) conditions or in real life
situations(on field)
• Common methods: traffic audits, TV and radio
panels and retail audits.
Observation: Strengths

• What people do rather than say

• Carried out without customers’ knowledge
• Does not rely on memory or honesty of
respondents
• Potential for bias is reduced
• Counters the refusal rate associated with some
methods of MR
Observation: Weaknesses

• Time consuming and costly

• Does not answer the why question
• Tells nothing about motivation
• Easy to misinterpret behaviour
• Only gives partial information
Surveys

• The key research method to obtain information

from large samples
• Wide range of users: to ascertain facts, beliefs,
opinions, attitudes
• Various methods to complete surveys:
interviews, telephones, face to face, postal,
online
Postal surveys: Strengths

• Wide coverage
• Low cost
• No interviewer bias
• Respondents convenience
• Lack of embarrassment
• Piggybacking
• Avoids travel costs
Postal surveys: Weaknesses

• Low response rate

• Lack of control of respondent
• Limited scope for open ended questions
• Limited to short questionnaires
• Long response time
• Biased response
• Misinterpretation of questions
Telephone surveys: Strengths

• Saves time
• Higher response rate
• Greater control over respondent than with
postal surveys.
• Sample less likely to be biased
• Cost limited to time spent on phone
• Avoids cost of travel
• Allows probing
Telephone surveys: Weaknesses

• Questions may be more limited than with

postal surveys
• Respondent has little time to consider
questions
• Data may not be available easily
• Intrusion into privacy
• Can be time consuming
Face to face interviews: Strengths

• Interviewer can prompt the respondent

• Can see the respondents reaction
• Respondent have more time to think
• Detailed responses
• Can get opinions
• Respondents give full attention
• Flexible
• Allows probing
• Trust can be built up to get more reliable data
Face to face interviews: Weaknesses

• High cost
• Time consuming
• Risk of bias
• Requires interview skills
Comparison of survey methods
Method Response Cost Time Non
rate response
bias
Face to face High High Slow Low

Postal Low Low Slow High

Phone Moderate Moderate Fast Moderate

Electronic Moderate Low Fast High

Focus groups

• Used for quantitative data gathering

• Usually consists of 8-10 respondents and a
moderator
• Moderator introduces the topic and guides the
conversation
• The aim is to seek opinions and find out
attitudes
• Composition of the group should reflect target
audience
Focus groups: Strengths

• Fairly Costly
• Quick
• Range of attitudes
• Detailed qualitative information obtained
• Flow of discussion encourages ideas and
participation
Focus groups: Weaknesses

• Need to build rapport

• Discussions must stay focused
• Needs good control by the moderator
• Some members may be inhibited
• Time consuming
• Opinion Leader dominance
Panels

• Continuous rather than ad hoc

• Useful in assessing shifts of attitude and
opinions over time
• A consumer panel consist of a representative
sample of people
• Panel members are usually induced to be
permanently available by means of small
payments or free samples
Panels: Strengths

• A good trend indicator

• Useful for analysing changes
• More probing
Panels: Weaknesses

• Fairly Costly
• Bias sample of people
• Panelists may adopt uncharacteristic behaviour
during panel sessions
• Panels have to be replaced periodically
• When novelty wears off members become
less-co-operative
Electronic/online surveys: Strengths

• Cheap compared to other methods

• No internal boundaries
• Versatile
• Quick
Electronic/online surveys: Weaknesses

• Incomplete directory of names

• Unrepresentative sample
• Brevity of e-mail responses can be a problem
• Respondents select themselves
• Little control over sample
Summary
 Virtually all market research projects are
different.
 Some are limited to review of secondary
data; others require complex designs
involving large scale collection of primary
data.
 Understand the eleven steps of the research
process.
 Steps can give researchers an overview of
the entire research process.
 Gives researchers a procedure to follow and
a framework.
 Many steps outlined are interactive and the
researcher may decide which ones to use.

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Thank You

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