Multimedia Marketing/Marketing.iso/market/chapter4.4p

Text File | 1996-08-22 | 12KB | 272 lines

SECTION 4.4  Marketing Research

INSTRUCTIONS Try to conceive of the ways that the MIS differs from marketing
research. Then go into this section to discover just what marketing research consists of.

EXAMPLE

A producer of frozen french fries for institutions (schools,
hospitals, and the like) conducted a research project to
determine what kinds of french fries college students preferred.
They varied the compositon, degree of crispness, color, and
other variables and had college students taste test the various
combinations. The research showed that students preferred serrated
(Z shaped) fries over straight ones and that shape was very
important in appealing to students. The company followed up on
the recommendations of the study and was able to penetrate the
college market very effectively.

DETAILS

While a well-conceived MIS can provide an invaluable data base
for decision making, the data collected is not always sufficient
to solve particular decision problems and additional data
collection is required. A chemical company, for instance, learned
from research that many consumers objected to the smell of
ammonia contained in the popular glass-cleaning products. Following
this opportunity, the company developed and introduced a vinegar-
based glass cleaner.

The MIS is an ongoing system. It operates on a full time basis,
gathering, processing, storing, and disseminating information. The
idea is that of a continuous flow. Conversely, marketing research
is intermittant. If problems with the sales force develop, researchers
may be called in to seek solutions. Once the project is completed,
the research stops. Later the company will begin other research
projects. Each one is oriented toward a specific detailed need of
one or more decision makers.

In between major projects, marketing researchers may be called upon
to analyze routine data. They may do environmental screening work,
analyze secondary data in search of trends, and look for areas where
useful marketing research could be conducted. These in-between tasks
are normally dropped for the time being when a marketing research
study is needed.

PROBLEM 1

A glass producer has a MIS but still conducts marketing research.
It is necessary to do research because the MIS:

A. Does not collect timely information.
B. Collects information from too many sources.
C. Does not collect information that is sufficiently specific.
D. Does not collect detailed information.

WORKED

A glass producer has a MIS but still conducts marketing research.
It is necessary to do research because the MIS does not collect
information that is sufficiently specific. The MIS collects a
variety of information that may be useful to a number of executives,
whether they are responsible for pricing, product development,
channels of distribution, transportation, advertising, sales, or
other functions. From time to time it will be necessary to make
decisions that require very specific information, however, such
as how customers feel about a particular company product. In this
case, the needed information may not be forthcoming from the MIS

ANSWER  C
INSTRUCTIONS Try to conceive of the ways that the MIS differs from marketing
research. Then go into this section to discover just what marketing research consists of.

EXAMPLE

A producer of frozen french fries for institutions (schools,
hospitals, and the like) conducted a research project to
determine what kinds of french fries college students preferred.
They varied the compositon, degree of crispness, color, and
other variables and had college students taste test the various
combinations. The research showed that students preferred serrated
(Z shaped) fries over straight ones and that shape was very
important in appealing to students. The company followed up on
the recommendations of the study and was able to penetrate the
college market very effectively.

DETAILS

Whenever information is collected and analyzed for a particular
decision problem, the process is termed "marketing research",
which is part of a MIS.

Marketing research consists of planning for, obtaining, analyzing,
and interpreting all the facts necessary to make an intelligent
decision concerning a particular problem. It involves systematically
obtaining and analyzing information about a market, such as what
buyers want, need, think, and feel.

While the involvement in this function varies from one company
to another, practically all firms of any size do some marketing
research. Typically, management budgets around one percent of
sales for this activity, and about 60 percent of all companies
have formal marketing research departments.

Other companies rely on consultants, advertising agencies, and
independent research agencies to conduct research for them. Even
those companies with formal research departments spend, on average,
about half their budgets on contracted work.

PROBLEM 2

A producer of chocolate chip cookies is a heavy user of marketing
research. This involves obtaining, analyzing, and intrepreting facts
necessary to make an intelligent decision about a particular:

A. Product.
B. Segment of the company.
C. Problem.
D. Marketing Function.

WORKED

If a producer of chocolate chip cookies uses marketing research, it
obtains, analyzes, and interprets facts necessary to make an
intelligent information about a particular problem. The company
uses research to help solve problems in product planning, pricing,
promotion, and distribution. The firm should conduct research
only when a problem surfaces.

ANSWER  C
INSTRUCTIONS Try to conceive of the ways that the MIS differs from marketing
research. Then go into this section to discover just what marketing research consists of.

EXAMPLE

A producer of frozen french fries for institutions (schools,
hospitals, and the like) conducted a research project to
determine what kinds of french fries college students preferred.
They varied the compositon, degree of crispness, color, and
other variables and had college students taste test the various
combinations. The research showed that students preferred serrated
(Z shaped) fries over straight ones and that shape was very
important in appealing to students. The company followed up on
the recommendations of the study and was able to penetrate the
college market very effectively.

DETAILS

Some problems are obvious, as when company advertising efforts
annoy target customers. Others are less obvious, as when sales
representatives are not making presentations in the ways in which
they were trained. Still other problems consist of lost opportunities.
If the company fails to take advantage of opportunities, it is
suffering losses that are really no different than obvious problems.
Failure to grasp opportunities is one of the hallmarks of an
unsuccessful company.


By itself, simply spending money on research is no guarantee of
useful results. Some studies merely verify the obvious; others
are performed haphazardly. Sometimes they are undertaken by personnel
who lack expertise. There are individuals who feel that anyone can
do marketing research--all it requires is to write up a questionnaire,
administer it to a sample of respondents, and calculate the results.
This is a very naive position.

If a company desires to do research, but its personnel lack the
training and background to do the work, it is a good idea to
retain a consulting firm, advertising agency, or research company.
These firms have individuals with the needed expertise to produce
quality results. Before retaining an outside party, it is advisable
to obtain references from other marketers who have employed them
in the past. Anyone can claim to be a consultant, and some of those
who self-designate themselves in this way are not qualified to assist
most marketers.

Whether the research is done internally or contracted from outside
sources, it is management's responsibiliy to be in a position to
assess a research project's usefulness and to judge whether or not
it represents a quality piece of work. This is accomplished by
understanding the nature of objectivity and the scientific method.

PROBLEM 3

Which of the following practices of a dishwashing liquid manufacturer
constitues a mistake in marketing research.

A. Assuming that specialized skills are not needed.
B. Requiring that all research work be objective.
C. Requiring that all research work use the scienific method.
D. Assuming that spending money on research is a guarantee of
   useful results.


WORKED

If a dishwashing liquid manufacturer assumes that specialized skills
are not needed in marketing research, this is a major mistake. It
is unwise to assign responsibility for this function to those who
have not been trained in the field and lack experience. Skilled
specialists are needed by the company to frame objectives, isolate
problems, design research projects, analyze the results of the
projects, and interpret what has been analyzed. These tasks are
likely to be mishandled by the uninitiated.

ANSWER  A

INSTRUCTIONS Try to conceive of the ways that the MIS differs from marketing
research. Then go into this section to discover just what marketing research consists of.

EXAMPLE

A producer of frozen french fries for institutions (schools,
hospitals, and the like) conducted a research project to
determine what kinds of french fries college students preferred.
They varied the compositon, degree of crispness, color, and
other variables and had college students taste test the various
combinations. The research showed that students preferred serrated
(Z shaped) fries over straight ones and that shape was very
important in appealing to students. The company followed up on
the recommendations of the study and was able to penetrate the
college market very effectively.

DETAILS

Quality research yields results that are both valid and reliable.
Validity refers to the extent to which a study measures that which
is intended. Reliability, in contrast, refers to its repeatability;
whether or not the results are from random fluctuations or if, in fact,
they are consistent with the underlying phenomena being measured.

If a study is conducted at one time, but is not acted upon until later,
it may lack validity, because it no longer matches market conditions
at the time  when management takes action. It may lack reliability
if the responses from the members of the sample do not remain stable,
even over a short time period.

The best way to assure valid and reliable results is to follow the
scientific method, which is a systematic and objective procedure.
The scientific method involves a sequence of activities which,
when combined, produces what is called the marketing research process:
initial observation, hypotheses formulation, determining needed
information, developing a data collection plan, data acquisition,
analysis, and interpretation.

PROBLEM 4

The producer of an acid blocker for heartburn conducts unreliable
research when it:

A. Asks consumers when they experience pain, but it really wants
   to measure discomfort, not pain.
B. Asks consumers for their image of the company product, but this image
   varies considerably from one minute to the next.
C. Asks consumers why they use acid blockers but consumers interpret
   this question as meaning when do they use acid blockers.
D. Asks consumers for their evaluation of the product, but many
   consumers are really evaluating the package.

WORKED

If the producers of an acid blocker ask consumers for their image
of the product but this image varies considerably from one minute
to the next, the research lacks reliability. A reliable measure is
stable--it remains the same with the passage of time and is
repeatable. On the other hand, an unreliable measure changes with
changes in the consumer's mood, the weather, etc.

ANSWER  B