Marketing Research

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Marketing Research

• Dr. David M. Andrus
• Exam 2
• Lecture 2

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Themes of My Presentation

• Internal Suppliers of Marketing Research
• Marketing Research Industry Growth
• Marketing Research Proposals
• Business Ethics

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Who Uses Marketing Research?

• Company lacking information about its markets.
• AMA study revealed the average marketing research
  budget was 1.9 million for marketing research
  departments.
• Consumer and industrial manufacturers,
  advertising agencies, and retailers/wholesalers
  spend about 1.2 of sales on marketing research.
  Financial services, publishers/broadcasters,
  health services, and utilities spend about 0.6.
• Federal Agencies spend 4.5 billion per year on
  marketing research.

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Percentage of Companies with Marketing Research
Department

• Retailing/Wholesaling - 91
• Manufacturers of Consumer Products - 89
• Publishing and Broadcasting - 86
• Nonprofit Institutions - 85
• Advertising Agencies - 79
• Utilities - 79
• Financial Services - 76
• Manufacturers of Industrial Products - 66
• Health Services - 43

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Users of Marketing ResearchCompanies with Formal
Departments ()
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Top Ten Marketing Research Companies of the World
Research Company
Head Office
Global Revenues
1. VNU Inc. 3,429 Netherlands 2.
Taylor Nelson Sofries.
1,720 England 3. IMS Health Inc.
1,569 USA 4. The Kantar
Group 1,136 USA 5. GFK Group
835.5 Germany 6. Ipsos Group
753.2 France 7. Information Resources
572.8 USA 8. Synovate.
499.3 England 9. NOP World
407.1 England 10.Westat Inc. 397.8
USA
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Growth in Research Spending (US)
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Industry Growth and Trends

• 67 of Global Top 25 revenues were from outside
  the United States.
• Top 50 USA research firms had US-only revenues of
  6.3 billion in 2004.
• USA firms had worldwide revenues of 13.3 billion
  in 2004.
• The average annual real growth rate is 5.17 for
  the past 16 years.

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Top 10 Markets in Value of Marketing Research Data

• United States
• United Kingdom
• Germany
• France
• Japan
• Italy
• Canada
• Spain
• Brazil
• Australia

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Good Sources for Marketing Information

• The Arbitron Company
• Bureau of Labor Statistics
• Bureau of Transportation Statistics
• Census Bureau
• The Conference Board
• Donnelley Marketing
• Dun Bradstreet
• Hispanic Market Connections, Inc.

• Maritz Marketing Research, Inc.
• Nielsen Media Research
• J.D. Power Associates
• Roper Starch Worldwide
• SRI International
• Teenage Research Unlimited
• Total Research Corporation

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The New York Chapter of the AMA Publishes a
Directory of Marketing Research firms
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Survey of Buying Power

• Effective Buying Income (EBI) is income after
  taxes
• Buying Power Index (BPI)
• How to calculate BPI
• BPI (Population of Market Area A/Total U.S.
  Population 2)
• (EBI of Market Area A/Total U.S. EBI) 5
• (Retail Sales of Market Area A/Total U.S.
  Retail Sales) 3
• Demographics USA provides several other indices
  for measuring a markets buying power
• Hi-Tech BPI
• Manufacturing BPI
• BPIs for Premium, Moderate and Economy Priced
  products

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Statistical Product and Service Solutions (SPSS)

• Headquartered in Chicago.
• Has more than 40 offices, over 900 employees, and
  1999 revenues of 140 million.
• Claims to make marketing research easier by
  providing solutions that discover what customers
  want and predict what they will do.
• Products integrate and analyze marketing,
  customer, and operational data.
• Developed its own marketing research line of
  products called SPSS MR.
• SPSS MR provides users with a complete complement
  of integrated software solutions that cover the
  entire research process.

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SPSS Marketing Expertise Abilities

• Survey Design Creates questionnaires using a
  graphical interface and drag-and-drop techniques.
  Once data is gathered the results will be
  available almost instantaneously.
• Data Collection Can help gather data through
  either the Internet, computer-assisted telephone
  interviews, or computer-assisted personal
  interviews. After data collection is completed,
  it has software to input the data into the
  computer.
• Analysis Can turn data into information using
  software packages that tabulate and manipulate
  data, create tables, analyze and create
  statistical models, and data mine.
• Publishing Will turn traditional papers into
  multimedia presentations.

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Formulate the Marketing Research Proposal

• A marketing research proposal or ITB Invitation
  to Bid or RFP Request for Proposal
• defines the marketing management problem
• specifies the research objectives
• details the research method proposed by the
  researcher to accomplish the research objectives
• Summarizes major points in the study

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Define the Marketing Managers Problem

• Speculate on anticipated consequences of the
  action.
• What will be the impact on the problem at hand
  and 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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Formulate the Marketing Research ProposalDetail
the Proposed Research Method

• The proposed research method identifies
• data collection mode
• questionnaire design
• Sample plan
• Dummy tables
• Analysis techniques

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3 Functions of Proposal

• Descriptive
• Contractual
• Selling
• Outside clients require more detail

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Research Proposal Questions

• What are the research objectives? Always keep
  them in mind
• What are possible primary and secondary data
  sources?
• Which date collection method is best to test your
  ideas?
• What kinds of questions about consumer behavior
  do you want to ask your sample?
• How large a sample is needed and what statistics
  will you use to analyze the data?
• Set deadlines for completing each stage of the
  research process
• Always keep the cost of the study in mind
• Managers are usually interested in the first and
  last stages of the research process

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Ethics and Marketing Research

• AMA Code of Ethics
• Prohibiting selling (sugging) or fund raising
  (frugging) under the guise of conducting research
• Maintaining research integrity by avoiding
  misrepresentation and omission of pertinent
  research data
• Treating others (buyers and suppliers) fairly
• Buyers Being sold unnecessary research, supplier
  firms sharing buyers confidential information.
• Suppliers Being asked for phony RFPs, not being
  paid by buyers

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Do Marketing Researchers Havean Ethical
Responsibility?

• Ethics General nature of morals and of
  specific moral choices moral philosophy and the
  rules or standards governing conduct of a
  profession.
• Business ethics Moral principles and standards
  that guide behavior in business and good business
  values dictate..
• Social responsibility Obligation a business
  assumes toward society.
• Economic responsibilities Produce goods and
  services society needs and wants at a price that
  can perpetuate the business and satisfy its
  obligations to investors.

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Ethical Issues

• The Public Researchers are asked to conduct
  research on dangerous products.
• Research to increase tobacco product sales to
  kids?
• Research to increase bourbon consumption of teens?

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Ethical Issues

• Respondent refusal rates are climbing. Public is
  wary of losing privacy.
• Deception should not be used.
• Respondents should not be identified if they are
  promised anonymity/confidentiality
• Marketing research does invade privacy

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Invasion of Privacy

• SPAM sending unwanted email
• Industry currently debating opt-out v. opt-in
  standards (Opt-in much stricter)
• Online Survey Research Abused respondents via
  SPAM initially. Today, industry is a leader in
  anti-spam legislation. Researchers must have a
  preexisting relationship with potential online
  respondents
• Respondents must have a reasonable expectation
  they will be contacted via email.