Marketing research

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Marketing research
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Lecture Objectives

• After going through this chapter, you should be
  able to
• Explain the role marketing research plays in
  decision-making in the hospitality industry
• Identify sources of marketing information
  available to hospitality organizations
• Define secondary and primary data collection
• Explain the differences between qualitative and
  quantitative research methods
• Recognize how bias and sampling errors can
  distort marketing research findings
• Describe how hospitality organizations conduct
  online research.

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Introduction

• Managers are paid to make decisions.
• The purpose of marketing research is to inform
  and improve decision-making by reducing
  uncertainty.
• Marketing research can be defined as the
  systematic gathering and analysis of data to
  provide relevant information to aid
  decision-making.
• Marketing research is a planned process.
• Market research describes the investigation of
  consumer and organizational markets
• Marketing research includes research into all the
  marketing mix variables and the macro (PESTE) and
  micro-environments.

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International Marketing Research

• Presents unique problems because of the
  cultural and technological differences between
  countries
• Translation difficulties
• Variations in customer behaviour because of
  different cultural backgrounds
• Variations in customers product knowledge
• Difficulties in obtaining comparable samples
• Different cultural responses to market research
  surveys
• Differences in the infrastructure

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Marketing Information Systems

• Hospitality managers need relevant, accurate,
  current and reliable information to be able to
  make effective decisions that will influence the
  future of the business.
• Small, single-unit, owner-operated companies rely
  on informal approaches to data collection and
  interpretation.
• Larger organizations need to develop more
• sophisticated marketing information
  systems to ensure that corporate executives
  understand complex environment
• The marketing information system helps marketers
  to identify trends and plan for the future

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The hospitality marketing information system
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Sources of information - internal

• Internal information is held by the organization
• Accommodation businesses hold a wealth of
  information about customers because of legal
  requirements
• Information sources include
• Customer records
• Guest history
• Departmental reports
• Marketing and sales reports

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Sources of information - external

• External information can be collected via
  the Internet and publications including
• International and national government
  organizations
• Marketing research organizations
• Publicly quoted companies Annual Accounts
• Trade associations
• Hospitality industry trade press
• Financial press
• Universities and academic publishers

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Secondary (or desk) data collection

• Secondary (desk) data are data that have already
  been collected
• It is relatively easy to obtain secondary data
  since the information has already been published
• Limitations to secondary data include
• data have been collected and analysed by another
  organization
• some organizations may deliberately manipulate
  data
• other organizations may have inadvertently
  introduced bias
• information is generally available to competitors
• secondary data and analysis can often be dated
  because of the long time between carrying out the
  research and publishing
• the findings

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Primary data collection

• Primary data consist of original information
  collected by an organization for a specific
  purpose.
• The data have not been published before.
• The organization conducting or commissioning the
  research determines the research objectives and
  research questions.
• Data are collected directly to provide answers to
  those questions.
• Primary research is usually more costly than the
  secondary research.
• Advantages of primary research include the
  following
• The ability to frame the research questions to
  the needs of the organization
• Research is current and not dated
• Research is confidential
• Primary data can enable a hospitality company to
  gain competitive advantage if competitors are not
  carrying out similar research.

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Qualitative data

• Qualitative research aims to provide a deep
  understanding of peoples contextualized
  behaviour
• It aims to explain how and why people behave in
  certain ways
• Qualitative research in hospitality uses
• Observation
• in-depth interviews,
• focus groups (also known as group discussions)
• qualitative questions in surveys

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Quantitative data

• Quantitative research uses a wide range of
  methods to obtain and analyse numerical data
• Quantitative research counts numbers, in terms of
  either volume or value. For example
• the number of customers, passengers, residents,
  diners, room nights, room occupancy
• restaurant units sales or a hotel chains room
  sales.
• If data are numeric then the research is
  quantitative

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Quantitative research

• Quantitative research techniques are founded upon
  statistical theory
• Correct statistical methods are required to
  reduce possible error and bias
• Possible errors include
• Sampling errors
• Respondent errors
• Investigator errors
• Administrative errors
• In large surveys, statistical software packages
  are used to process the quantitative research
  data.

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Quantitative research methods

• exit surveys
• mystery customer audits
• telephone (including mobile phone) surveys
• online surveys
• omnibus surveys.

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Closed and open questions

• Closed questions provide a number of alternative
  answers from which the respondent chooses one
  answer, for example questions about
• respondents age, sex, employment, income
• Closed questions use a structured format which
  creates a data set that
• can be efficiently analysed using statistical
  methods.
• Closed questions are essential if a quantitative
  research method is used
• Open-ended questions allow respondents to provide
  their own answers,
• Examples include Where would you stay tonight if
  this hotel was fully booked? and How did you
  feel about the quality of service?
• Open question allows respondents to use their own
  words to describe their experience, feelings and
  opinions.
• Qualitative research findings using open
  questions provide rich data
• Researchers usually ask a combination of both
  closed and open questions
• and combine qualitative and quantitative
  analysis.
• Compare Le Meridien and Malmaison in-room
  customer questionnaires

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Le Meridien customer questionnaire
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Le Meridien customer questionnaire (2)
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Malmaison comment card
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Marketing research process

• There are six steps in the marketing research
  process
• Formulation of research objectives
• Development of a research plan
• Data collection
• Data analysis
• Assess the reliability and validity of data
• Presentation of findings

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Online research

• Advantages of online research include
• significant cost savings in the design and
  administration of questionnaires and discussion
  groups
• the ability to accurately target surveys to
  current, former or potential customers.
• Often, customers are incentivized to participate
  in online surveys
• Post- consumption e-surveys provide customers
  with a convenient tool to give feedback on
  service quality and customer satisfaction.
• Tools such as blogs and social networking sites
  are useful to obtain unsolicited such for
  customer- generated comment
• The Internet is available to all sizes of
  hospitality companies.

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Criticisms of Marketing Research

• Academics and practitioners have criticized
  modern marketing research for a number of reasons
• The focus on collecting data and performing
  statistical analysis, which does not provide new
  insights for the business or inform
  decision-making
• Flawed marketing research methodologies that
  introduce unacceptable levels of bias or error
• The emphasis on research stifles creativity in
  marketing
• Despite these criticisms, major hospitality
  companies recognize the importance of marketing
  research and carry out extensive customer and
  competitor research on a continuous basis

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References and Further Reading

• Altinay , L. , Paraskevas , A. ( 2008 ).
  Planning research in hospitality and tourism,
  Oxford, UK Butterworth-Heinemann .
• Bowie, D Buttle, F (2011), Hospitality
  Marketing Principles and Practice, Oxford, UK
  Butterworth-Heinemann
• Brown , S. ( 2001 ). Marketing The retro
  revolution . Sage .
• Chaffey , D. , Ellis-Chadwick , F. , Johnston ,
  K. , Mayer , R. ( 2009 ). Internet marketing
  strategy, implementation and practice ( 4th ed.
  ). Pearson Education .
• Daymon , C. , Holloway , I. ( 2002 ).
  Qualitative research methods in public
• relations and marketing communications .
  Routledge .
• Saunders , M. K. , Thornhill , A. , Lewis , P.
  ( 2009 ). Research methods for business students
  ( 5th ed.). Financial Times/Prentice Hall .
• Usunier , J. C. , Lee , J. ( 2009 ). Marketing
  across cultures ( 5th ed.). Financial
  Times/Prentice Hall .