AE 802 Marketing Research Methods

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AE 802 Marketing Research Methods

• Week 1

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AE 802Marketing Research Methods

• Courses (BSc part III)
• Food Marketing Economics
• Food Science, Food Economics Marketing
• Agricultural Economics
• Rural Resource Management
• Module convenor Dr. Mario Mazzocchi
• Module contributor Dr. Hal MacFie
• Where and when Wednesday 9-11 room AG GU04
• Lab sessions in room AG GL20 (weeks 15, 17, 19)

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Communication tools

• Web page www.rdg.ac.uk/aes02mm/
• Contacts
• Room 310 Extension 6484
• M.Mazzocchi_at_reading.ac.uk
• Do use e-mail!
• FAQ section on the web page

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Web page www.personal.rdg.ac.uk/aes02mm/MarResMe
tUG.htm
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Intended outcome

• Knowledge of a selection of the techniques used
  by marketing researchers in order to improve the
  quality of information used in decision making
• To understand the suitability of different
  methods as tools for solving marketing problems
  commonly encountered with food products

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Outline content

• A range of research approaches to solve specific
  marketing problems is presented and discussed.
• The marketing research process
• Questionnaire development and field work
• Survey methods and sampling techniques
• Data base management and descriptive statistics
  (SPSS tutorial)
• Factor analysis and cluster analysis
• Preference mapping
• Correlation, regression and advertising analysis
• Conjoint analysis

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Course plan
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Textbook

• There is no official textbook.
• These recent books can be very helpful
• Malotra, N.K. (1999) Marketing Research An
  Applied Orientation, 3rd Edition. Upper Saddle
  River (NJ) Prentice Hall.
• Churchill, G.A., Iacobucci, D. (2002). Marketing
  Research Methodological Foundations. Harcourt
  College Publishers

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Suggested Readings (2)

• Most of marketing research textbooks available in
  the library cover the topics of this module
• For some topics (indicated during the course) it
  may be useful to read
• East, R. (1997). Consumer Behaviour. London
  Prentice Hall.
• (this textbook was also recommended for the
  Consumer Behaviour and Food Marketing course).
• Technical and frontier articles can be found on
  the
• Journal of Marketing
• Journal of Marketing Research
• Journal of Consumer Research
• Marketing Science

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Module assessment

• Coursework Assignment Final Exam
• Next week you will receive an assignment
  consisting in
• A specific research problem
• A SPSS data set
• You will be required to write a marketing
  research report (individual work) consisting of
• Analysis of the data provided
• A strategy for refining primary data collection
  (survey method, sample and questionnaire)
• Deadline for delivery is 17 March 2004

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Marketing research report

• You will be given (at the end of next lecture) a
  marketing research problem, an SPSS data set
  provided by your customer and a budget constraint
  and will be asked to
• Choose a technique to analyse data
• Provide results and comments
• SPSS Output
• Marketing advice
• Suggest how to improve/refine the method of data
  collection
• Questionnaire (max 1 page)
• Survey method
• Sampling method

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What is Marketing?

• A wide range of definitions
• Marketing is the management process which
  identifies, anticipates, and supplies customer
  requirements efficiently and profitably
• (Chartered Institute of Marketing, www.cim.co.uk)
• The achievement of corporate goals through
  meeting and exceeding customer needs better than
  the competition (Jobber, 1998)
• Is there any way I can increase profits?

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What isMarketing Research?

• 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 and improve our understanding
  of marketing as a process(American Marketing
  Association, www.ama.org)

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Information

• The key variable in marketing research is
  information. A marketing researchers must be able
  to identify the best way to
• Collect and organise information
• Analyse information
• Summarise information and make it operational
• These tasks vary according to the customer
  objectives

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Essential characteristics of marketing research

• It must be systematic (organised and planned)
• It must be objective (avoid biases, do not
  anticipate conclusions)

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The Marketing Mix(the four Ps)

• Is the set of controllable variables that the
  firm decision-maker can control
• Product (range, features, quality, packaging)
• Price (level, discounts, credit policy)
• Promotion (advertising, sales promotion)
• Place (channels of distribution, stock levels,
  delivery)
• Borden, N.H. (1965), The concept of Marketing
  Mix. In Schwartz G. (ed.), Science in marketing.
  New York John Wiley

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Product
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Price
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Promotion
1901
2002
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Place
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The marketing Research Process

• Formulate problem
• Determine research design
• Design data-collection method and forms
• Design sample and collect data
• Analyse and interpret the data
• Prepare the research report

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An example of MR process

• FLOP Inc. is a local music publishing company
  that has just signed a new rock boy band. It was
  the most expensive contract of their short
  history and it is a sort of bet on their future
  development. They have little money left in their
  budget, but they will spend most of it on the
  marketing side, as they can not afford to fail
  this attempt.

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The Flop Music Inc.

• The band is very well known and appreciated
  locally, but Flop needs to expand his market at
  least nationally.
• The band needs a new name, but as the components
  did not agree, Flop will take the decision

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The band
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1. The MR problem for Flop

• Objectives
• Identify the target customer
• Decide the band name among 3 alternatives
• Chose an advertising channel (Flop can just
  afford one)

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2. Determine research design

• Secondary data on records sales in UK are
  available, with a set of characteristics that
  influence sales. They say that the following
  factors boost sales
• Scandal stories about sexual behaviours the
  bands components
• Tragic death of the band leader or the whole
  group
• Promo video broadcasted on MTV

They are not famous enough to be considered in
tabloids.
Too risky and legal expenses might be too high
for Flop. And it just works in the short term
Too expensive channel
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3. Design data-collection method and forms

• The marketing consultant decides to start a
  primary data collection and decides
• To make interviews to music shop customers
• To draw the questionnaire asking for
• Customer characteristics (age, tastes)
• Purchasing frequency and behaviour
• Favoured source of news about music
• Multiple choice question on bands name

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4. Design sample and collect data

• Statistics say that about 71 millions of single
  records where sold in 1995
• Sampling frame Roughly the target customer will
  be above 15 years old and below 45 years old.
  This means a population of 21.5 millions people
  in the UK
• Sampling method A stratified sample. Strata are
• Geographical location of the shop
• Age class of the respondent
• Size of the sample given the time budget
  constraint, the overall sample size will be 900
  interviews outside shops

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5. Analyse and interpret the Data

• Data are edited, coded and tabulated
• A preference mapping analysis helps identifying
  the target consumer and the target media for
  advertising
• A model for sales response to advertising (on
  secondary data) helps choosing the investment in
  ads
• A cross-tabulation analysis for the target
  consumer allows to choose a name for the band

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6. The research report

• Finally, a research report is provided. Results
  are summarised and conclusions are drawn. The
  target consumer is identified as being aged
  between 20 and 30, living in cities, often with a
  degree and using pc a lot
• The advertising tools will consist in a short TV
  ad, and a highly detailed web site
• The name of the band will be

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Exploratory vs. conclusive research

• Exploratory research
• Insights and understanding of the research
  problem
• Loose definition of information needed
• Flexible (unstructured) research process
• Small and nonrepresentative samples
• QUALITATIVE analysis of primary data
• Preliminary to further research

• Conclusive research
• Test specific hypothesis and examine
  relationships
• Clear definition of informational need
• Formal and structured research process
• Representative and large samples
• QUANTITATIVE data analysis
• Conclusive results for decision making

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Primary vs Secondary data

• Primary data Data originated by a researcher for
  the specific purpose of addressing the problem at
  hand
• Secondary data Data collected for some purpose
  other than the problem at hand

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A comparison of primary and secondary data
Source Malhotra, 1999
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Qualitative research methods

• Qualitative research is a form of exploratory
  research which
• Provides an understanding of the problem and its
  underlying factors
• Is unstructured and flexible
• Based on small samples

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Against

• QUALITATIVE RESEARCH
• Results cannot be uses as conclusive
• Results cannot be generalised to any population
• QUANTITATIVE RESEARCH
• Then thousand times nothing is still nothing

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Situations where Qualitative R. is useful

• Impossible to use quantitative research (e.g.
  some situations in Developing Countries)
• People unable/unwilling to answer questions
• Need for emotional or affective information

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Preparing a Research Proposal

• The Research Problem
• Purpose of the research project
• Data sources and methodology
• Time, personnel and costs

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The Research Problem

• It is crucial to give a clear definition
• It is useful to identify its specific components
• How to define the problem
• Discussion with the decision maker (final user)
• Interview with experts in the topic
• Secondary analysis
• Qualitative research (e.g. Focus Groups)

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Objectives the research questions

• They are detailed statements of the specific
  components of the problem
• Research questions depend on
• Problem definition
• Theoretical framework
• Analytical model adopted
• For conclusive research, it is very helpful to
  reach a further detail and formulate hypotheses,
  i.e. unproven statements about a factor or a
  phenomenon of interest

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Data sources

• Explore available secondary data sources
• Primary data collection
• Exploratory research
• Qualitative research
• Survey plan
• Identification of the reference population
• Definition of the research questions
• Choice of sampling criteria
• Definition of the estimation methodology for
  making inference on the surveyed parameters
• Choice of sample size
• Choice of the data-collection method (method of
  administration)
• Questionnaire design
• Costs evaluation

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Methodology of analysis

• Data preparation coding
• Cleaning and consistency checks
• Select a data analysis strategy
• Statistical techniques
• Univariate techniques
• Multivariate techniques

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Univariate techniques
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Multivariate techniques

• Cross-tabulation
• Correlation
• Analysis of variance
• Multiple regression
• Discriminant analysis
• Conjoint analysis
• Factor analysis
• Cluster analysis
• Multidimensional scaling

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Time, personnel and costs

• Provide time estimates for each phase of the
  research
• Specify personnel required and their rates of pay
• Calculate nonpersonnel cost (such as printing,
  mailing)
• Travels

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The Research Report

• Title page
• Table of contents
• Executive summary
• Introduction
• Results
• Conclusion
• Recommendations
• 4. Introduction
• 5. Body
• Methodology
• Results
• Limitations
• 6. Conclusions and recommendations
• 7. Appendix
• Questionnaire
• Sampling methodology and definition
• Other tables not in the report
• Bibliography

• Completeness
• Accuracy
• Clarity

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The SPSS package

• Tutorials will provide a basic understanding of
  the software functioning
• An SPSS example will be given for most of the
  topics covered in this course. You are expected
  to be able
• To repeat the exercise
• To understand the SPSS output for each topic