Marketing Research Essentials: Concepts, Definitions, and Functions
I
NTRODUCTION
TO
M
ARKETING
R
ESEARCH
C
ONCEPT
O
F
M
ARKETING
R
ESEARCH
According
to
Henry Mintzberg
,
a manager
performs
interpersonal, informational &
decision
making
or disturbance handling
roles. But in
absence
of
exact
accurate information, there
are
all
the
more
chances to have taken
a
wrong
decision.
“ It
takes years to get
a
customer
and it
takes
second to lose
one.
”
In
Second words of
marketing research means
gathering,
recording,
collecting,
analyzing and
interpreting the data collected
are
the
activities
done
in marketing
research.
Definitions:
Marketing
is
the activity, set of
institutions
and
process for creating that have
value
for
customers, client, partners
and
society.
The
word ‘Re’
in
search suggests the
continuity
required
for
research
effort,
as market
evolves, changes, discards,
adopts, newer
futures
in
the product offerings, answering customers choices
is again a
task of
marketing research
IMRB
international,
TNS India and
Synovate
India are
some of the top
market research
companies.
Marketing wants precise answers
&
emerging
trends
on
1.
Who
(
The target customer
)
2.
Why
( Features,
decision process,
role
of
influencers & information
)
3.
What
( Product
choices, element
of
individuality &
loyalty
)
4.
Where
(
Distribution channel
made
use of,
impact
of relations etc.
)
5.
When
(
Trends in
purchase pattern
–
seasonality, cyclicality,
irregularity
or festival
impact
of social events
)
6.
How (
Choices of
all
four
Ps
)
F
UNCTIONS
O
F
M
ARKETING
S
EARCH
.
It
enables getting
information
for effective
decision
making.
It
helps
in
preserving historical
records and
marketing
knowledge.
Managing
research
process
in
totality.
Becoming
light bearer
in
terms of
market
expenditure.
Making
market intelligence available
to
all
the
departments
as a
central
resources.
Ensuring
research
design to be
in
line
with
research
objectives.
Integrating
research
activities, so that
all
the
departments can
avail
crucial
relevant
information
F
EATURES
O
F
M
ARKETING
R
ESEARCH
Features
of marketing
research are as
follows.
Variety
of
methods.
Art-Science Scientific basis of
collection
and
individual
ability or
art in
finding
solutions.
Applied
research.
A
Package.
Phases.
Process cum
tool.
Fills
and
links the
market
gaps.
Advantage
:
Company
–
Consumer.
Strategy or
Trade
Secret.
No
Auto mode –
Self
corrections.
New
borne
–
Wide
acceptance.
Systematic,
Objective
&
accurate.
I
MPORTANCE
O
F
M
ARKETING
R
ESEARCH
Large
spending
&
inbuilt expectation of return on
investment
expenditure
Confident step
forward
Meeting
marketing
objectives
Helps
in
decision
making
Finding
solution to
marketing
problems
New
markets
or
avenues
Key
questions
get
answered
S
COPE
O
F
M
ARKETING
R
ESEARCH
Scope of
marketing research is very
wide
&
broad.
Sales
Research.
Market
Research.
International
Marketing
Research.
Product
Research.
Pricing
Research.
Distribution
Research.
Advertising
Research.
Media
Research
Consumer
Research
Packaging
Research
Motivation
research
Policy
research
Sales
Research:
Data compared between inter-territorial
zones &
intra-territorial
zones. Its
shows change
in
tastes
and
preferences of
customer.
Survey
of
Sales people
and
future demand,
change
required in
selling
method
etc. can be
known through such
research.
o
Market
research:
A
firm operates
in a market
environment which
consist of competition. Different prices, strategies
of competitor
& result impact in
sales etc.
are
assessed through
market research.
Sales
territories,
sales
quotas and
sales targets can be fixed with such
research.
International Marketing research:
Opportunity
in
one country
may
die down,
whereas the same product
in
other country can be
high demand. Environmental threats
and
opportunity profile can be
created and
SWOT
analysis for entering
various
global
markets
can be
prepared.
The
decision can be
achieved
through
international
marketing research by
studying
consumption patterns abroad, competition,
consumers from foreign countries, governmental
role and impact
on sales,
alliances
or full fledged
operations.
Product
Research:
It
studies the impact of change
in
product
design, colour, size, shape,
quality,
packaging,
brand
name,
price sensitivity, accessories,
attachments
and
price of product on
sales.
Innovation, modification, product life cycle
based strategies, classification of products
as
per
BCG
matrix facilitated through product
research.
o
Pricing
Research:
It is
studies of pricing of product.
It
selects
a
suitable
method
of pricing.
It
fix the price of the
product.
It
compares the company’s product price
with price of competitor's.
It
also fixes the discount
&
commission which
are
given to
middlemen.
Distribution
Research:
It includes
answers of
questions
such
as
1.
How
the product reaches to the customer
?
2.
Are
there
region
wise prefers
?
3.
Do they prefer to
purchase
products from
retailer
or do they go for online purchase
or
do they have
any
prefers for distributors
?
o
Advertising
Research:
it is
studies
about
advertising of the product.
It
fixes the
advertising
objectives.
It
also fixes the
advertising
budget.
It
decides
about
advertising
message, layout, copy,
slogan
,
headline
etc.
It
selects
a
suitable
media
for
advertising
Media
Research:
In media research Ad.
budget, campaigns,
promotional strategies
& its impact
on sales
is
assessed of
media
like
TV, Radio,
Newspaper,
Magazines,
Internet
etc. Media cost,
media
planning
and
sales promotional planning
are
facilitated with
it.
Effectiveness of
media,
timing of
advertising
are
answered with this
research.
o
Consumer
Research:
Consumer’s
needs
changes
in
them cyclicality,
seasonality,
irregularity,
like-dislike,
awareness
level,
interest &
desire
in
purchase action,
purchasing
attitude, impact
of demographics like
age,
gender,
income,
location, buying
motives
etc.
Packaging
Research:
Ease, attractiveness,
level of value
creation, packaging
cost and
relevant packaging
material
gets decide
due
to
packaging
research. The
packaging should
be for
better
handling
or
storage. Customer prefers
packaging for
ease
and its
attractiveness.
o
Motivation
Research:
Buying motives, rationale
behind buying influence
and impact of
sales
promotion on
sales
is
measured
through
marketing
research.
o
Policy
Research:
marketing
polices, inventory polices, sales
policies, distribution policies, pricing policies etc
allows a
company to from streamlined
policies
M
ARKETING
R
ESEARCH
P
ROCESS
.
Define
the
Problem.
Primary
Survey
Fi
n
a
l
is
i
n
g
Objective
Sou
r
cing
out
Data
Re
search
Design
Preparing
Questi
onn
a
ire
Sample
R
e
spondents
Data
Collection
Data
Proc
e
ssing
Analysis
of
Data
Drafting
Research
Report
Presenting
finding for
decision,
following
Define the
problem:
The first step
in a
marketing
research
process
is
to identify
the problem or opportunity. The problem
may
be
about
decrease
in
sales,
increase in
competition,
expansion
of
market, etc.
Primary
Survey:
It makes a
point
to ask a
question, whether the problem
is an
outcome
or is it a cause.
even
if it
being
a cause its aggravation
could
be
due to
several
other
serve
factors.
Stopping
at out
comes
does not help
in
digging out the
exact
problem
or
concerns.
Finalising objective:
After
the survey, the researcher comes to
know
the cause
behind the situation.
In
this stage
its
like
a
flow chart which
is
finding result of
various
causes
and its
varying
level
of impact
leading
to
problem.
Sourcing
out
data:
The researcher
first collects secondary data.
This
is
because
it is
easily
available and
less costly.
It is
collected by Desk Research. Desk Research can be
internal
for e.g. collected from company's records or
external
i.e. acquired
from libraries, trade journals,
government sources, etc.
If
the secondary
data is
not
sufficient to solve the
marketing
problem, then
primary data
is
wheeled
.
Collecting primary data
is
very costly
and
time
consuming.
It
can be collected by using survey
methods, i.e.
by doing personal interviews,
telephone
interviews and mail
surveys.
It
can
also
be collected by using observational
method and
experimentation
method.
Research
Design:
Research
design
is a
plan for
conducting
a research. It
guides the
researcher in
data
collection.
It
gives proper
direction to the
research.
Preparing
Questionnaire:
In
this stage, primary data
is
collected with the
help of
a
questionnaire. So the
researcher
has to
prepare
a questionnaire. A questionnaire is a
list of
questions.
These questions are
asked to the
respondents for
collecting data.
The questionnaire
must
be suitable so that
the
require
data
is
collected
easily,
quickly and
correctly.
It is
used for
conducting person
interview,
telephone interviews
and mail
survey.
The researcher must
decide
about
the type of the
information required,
the type of
questioned
to be
asked,
the wordings of the
questionnaire, its
order,
etc.
Sample
Respondents:
Ensuring
no
lapses
in
structure or wording of
questionnaire, a
dry
run
or
rehearsal is
attempted.
This
stage
is
also known
as
pilot
survey.
Data
Collection:
Data can be collected such
as mail
survey
method,
with help
of
trained interviewers
in
case of
personal
interview method.
Collected data should
be
reliable, magnifiable,
sufficient
&
complete.
Data Processing:
collected data
is
processed for drawing out
larger picture. Classification of data, scrutiny of
data, editing, coding etc
are
done
in
this stage.
It is
arrangement &
processing of data for
analysis.
Analysis and
interpretation of
data:
In
this stage, the researcher
analyzes and
interprets
the data.
That is,
he studies the data
very
careful
and
draws conclusions from
it. These
conclusions
are
then used to solve the
marketing
problem.
Drafting Research
report:
In this
stage,
the researcher prepares the final
research
report. This report
contains
a
title
of
the
report, method
used,
findings,
conclusions
and
suggestions about
how
to
solve the marketing problem.
The language of
the
report must not be very difficult. The report must
be
submitted to
the marketing executives
for
recommendations and
implementation.
o
Presenting finding
for
decision,
following:
Finally,
the last step
in a marketing research process is
to do a
follow
up.
In this
stage, the
marketing
executive makes changes
in
the
product, price, marketing policies,
etc.
as
per the
recommendations of
the
report. Here,
the
researcher
should
find
out, whether
his
recommendations
are
implemented properly or not. He
should also
figure-out,
whether
the marketing
problem
is
solved
or
not.
L
IMITATIONS
O
F
M
ARKETING
R
ESEARCH
.
Limitations of Marketing Research are as
follows:
No
Auto mode or readymade
solution.
Not
a
one size
fits
all.
Data
dependent.
Not Dynamic
as
the
world out
there
is.
Can avoid a risk,
but
not without a
cost
.
Not
an
effective
prediction.
Dependence
on skilled
researcher.
Customers
and
competitors
make
the
environment
Applicability is
the
key.
Old data
=
No
data.
Communication
is
Important
Urban
– Rural
disparity
Back
to square
one
Managing
Marketing Information
Systems
and
Marketing
Research
Why
Small Businesses Need Marketing
Information
System?
The
advantages
of
having
an
effective
information
system
are
1.
Organized
collection
and
storage
of
data
in
the
Organization
2.
Reduced
information searching
time
and
cost
3.
Speed up
obtaining
relevant
information
sufficiently
to make
decisions
4.
Ability
to forecast
future
market
status
5.
Provides
a
competitive
advent
What
is an Information
System
(IS)?
An
information
system
is
a
set
of
interrelated
components
that
collect, process,
store
and
disseminate
information
to
the
parties
who
make
decisions
regarding
the
business.
A
marketing information
system
is a kind
of
information
system
which
gathers
and
stores
data
on
marketing
.
A
Marketing Information
System
(MKIS)
is a
collection of
people,
equipment's,
and
procedures
to
collect,
sort,
analyze, evaluate
and
distribute needed information
in
timely and
accurate
manner
to
the
marketing
decision
makers
(Kotler
&
Armstrong,
2013).
This
consist
four
steps.
•
Access
information
needs
•
Develop
needed
information
•
Analyze
information
•
Distribute information
for
decision
makers
Marketing
Information
System
(MKIS)
In
a
small business
organization,
the
records are
kept
about
•
Orders
•
sales
prices
of
the
products
•
customer
complaints
•
r
e
c
ei
v
ables
f
r
o
m
de
b
t
o
r
s
and
p
a
y
able
t
o
the
creditors.
These
records
are
called
as
internal
records
.
These
records
can
be
maintained
either manually
or
using
computer
data
bases.
Internal
Records
System
Ex-:You
may have seen small grocery shops
maintain
small invoice
books
as record of
sales.
That is one
example for maintenance of an internal record in a
small
business.
Internal
records
system
provides
data for day today
decision
making.
But a
Marketing intelligence
system
provides
predictive
data
relating
to
a
particular
situation.
It is
defined
as a
system
which
produces
everyday
information
about
the
changes in the
marketing
environment
.
the sources
of
marketing intelligence
system
Newspapers
Magazines
trade
publications
talking
to
customers
suppliers
and
distributors
A
small business
organization
can
keep
manual
records
of
data
generated
through
this type
of
system
for effective
decision
making
.
Marketing
Intelligence
System
The
next component
of
MKIS
is
“
Marketing
Decision
Support
Analysis
”.
These
are tools
which
can
be
used
to analyze to make
effective
marketing
decisions
.
Marketing
decision support analysis
tools
include
computer software
like
Geographic Information
System
(GIS)
to
track
inventory
details
of
the product dealers.
Further,
this includes
statistical tools
like
time
series sales
modes,
linear
programming, elasticity
models
(price,
incomes, demand,
supply,
etc.),
spreadsheet 'what if
models’.
These
information
help
marketers to make
decisions
on
market
segmentation,
pricing policies, budgeting
,
etc.
Marketing
Decision
Support
Analysis
The
purpose
of conducting
a
marketing research
is
to
gather
information
regarding
a specific
marketing
problem
of the
business
.
•
An
organization
can conduct research by using
a
research team
in
the
organization
itself
or
outsourcing
it
to
the
research
firm.
Marketing
Research
System
Marketing
Research
Process
Marketing
research
is
a
process
of
systematic
design, collection, analysis and
reporting
of
data
relevant
to
a specific
marketing
situation
.
According
to
Kotler
and
Armstrong
(2014)
marketing research
process
has
four
steps
which
can
be
briefly
discussed
as
follows.
•
Defining
the problem
and
research
objectives
•
Developing
the research
plan
to
collect information
•
Implementing the research
plan -
collecting
and
analyzing
the
data
•
Interpreting
and
reporting the
findings
01.Defining
the
problem
and
research
objectives
This
is
the
first
and
most
often
the
hardest
step
in
the
marketing
research
process.
Most often
the business
owners may be aware
that
something is
wrong
,
but
they
may
fail
to
know the
exact
cause
for
the
problem
.
For
example
,
Would
a
10
percent
decrease
in
the
price
of
a
product
result in
attraction
of
more
customers
to
offset
the impact
of price
reduction
?
The
r
e
f
o
r
e
,
i
n
suc
h
a
s
i
tu
a
t
i
o
n
t
h
e
d
e
t
er
m
in
a
t
ion
o
f
r
es
e
a
r
c
h
p
r
o
b
l
em
and
objectives will guide the
entire
process
.
It is
very important
to
identify
the
real problem
apart
from
symptoms of
the
problem.
02.Developing
the research plan to
collect
information
•
This plan should basically outline
the
sources
of
information, contact
methods, sampling
methods and
the
tools that
should
be
used
to
gather
new
data.
When
c
ollecting
i
n
f
orm
a
tion,
busines
s
es
c
an
r
e
f
e
r
bot
h
p
rima
r
y
and
secondary
data
sources.
•
Primary
data
includes the
information
collected for
a
specific
purpose
at
hand
whereas.
•
secondary
data
includes
information that
has
been
already
collected for
any
other
purpose
.
survey method,
observation,
interviewing
customers,
mystery
shopping are
the methods
used
to
collect
primary
data
.
•
The secondary
data
can
be
collected
via
referring
paper
articles,
magazines,
data
from
department
of
census
and
statistics, central
bank
reports,
trade
journals,
etc.
03.Implementing
the
research plan - collecting
and
analyzing
the
data
•
This
is the
stage
in
which
the
research
plan
is
actually
put
into
action
where
the
actual
data collection
and
analysis
would
take
pace.
•
In
this
step
the
organizations
will
be
able
to
uncover
some of
the
problems
that might
have
happened
in the previous
stage
such
as
problems
of
interacting
with the
respondents, quality
of
participants’ responses,
mistakes
happened
in the
interviews
etc.
Accordingly,
after
analyzing the
collected data
the business
owners
will
be
able
to
identify
and
isolate important insights
which will
be
helpful in decision
making.
04.Interpreting
and
reporting
the
findings
•
Interpretation
of
the findings is
an
important
but
tricky
task
.
•
This
is
mainly because
the
interpretation
of
the
analysis will
depend on
a
number
of
factors
such
as the
knowledge
of
the
interpreter regarding
the
subject
and the
accuracy
and
relevance
of
information
.
•
Thus, it is
advisable
to
take
the advice
of the
experts
in
interpreting
the
results
and
drawing
conclusions
based on
them
.
Obstacles
of
Maintaining
an
Effective
Marketing
Information
System
in a
Small
Business
But
maintaining
an
effective
information
system
in a
small-scale
business
is
not
an
easy
task
due
to many
reasons.
•
Lack of knowledge on importance of
MKIS among
small
business
owners
•
Lack of human
resources
to
maintain
an
effective
MKIS
system
•
Short term business
focus
.
•
Lack of
awareness
on
how
to
maintain
a MKIS
system.
Promotional
Mix
41
Integrated Marketing Communications
Personal
selling
Public
relations
Direct
marketing
Sales
promotion
Advertising
BASIC
42
ADAPTABLE
A
d
v
e
rt
i
s
i
n
g
Advertising
P
e
rs
o
n
a
l
Selling
P
e
rs
o
n
a
l
Selling
Sales
P
r
o
m
o
t
i
o
n
Sales
P
r
o
m
o
t
i
o
n
Public
R
e
la
t
i
o
n
s
Public
R
e
la
t
i
o
ns
Direct
M
a
r
k
e
t
i
n
g
Direct
M
a
r
k
e
t
i
ng
Reach Many Buyers, Repeat
Message Many Times,
Impersonal,
Expensive
Reach Many Buyers, Repeat Message
Many Times, Impersonal,
Expensive
Personal Interaction, Relationship
Building, Most Expensive Promo
Tool
Personal Interaction, Relationship
Building, Most Expensive Promo
Tool
Wide
Assortment
of
Tools,
Rewards Quick
Response,
Efforts
Short-Lived
Wide
Assortment
of
Tools, Rewards
Quick
Response,
Efforts
Short-Lived
Very Believable,
Dramatize a
Company
or
Product,
Underutilized
Very Believable,
Dramatize a
Company
or
Product,
Underutilized
Nonpublic, Immediate,
Customized,
Interactive
Nonpublic, Immediate, Customized,
Interactive
Setting the Promotion
Mix
43
Factors
in
Setting Promotion
Mix
44
Buyer
State
Liking, Preferences, and
Conviction
Purchase
Product-Life-Cycle Stage
Introduction
Growth
Mature
Decline
Advertising
45
Advertising is
Any
Paid
Form of
Nonpersonal
Presentation
and
Promotion of Ideas, Goods, or
Services
by an Identified
Sponsor.
Its function is to
inform
consumers about product
differences,
new
products
and
application possibilities.
46
Advertising
Advertising
47
It plays a role
in the competitive
process by firstly bringing
differences in
products or
services to the attention
of
the
consumer.
Secondly, it
persuades consumers
to prefer
on company’s product
to
those
of
another.
Thirdly, It
creates value
by its
communication
strategy.
Main Advertising
Objectives
48
Informative
Advertising
Persuasive
Advertising
Reminder Advertising
Characteristics
of
Advertising
49
One
way
communication
It
deals with
thousands of
consumers and
each
one
receives
the same
mesage.
Depends on symbols: brand
logos
Low-cost mass communication
Persuasive communication
Advertising
media
50
Newspapers
Magazines
Television
Direct
Radio
Etc…
Personal
Selling
51
Involves Two-Way,
Personal
Communication Between
Salespeople
and Individual
Customers:
face
to
face,
by
telephone,
through video
conferencing,
or by other
means
Personal
Selling
52
A personalized form of
communication in
which a seller
presents the features
and
benefits
of a product
to
a buyer
for
the
purpose of making a
sale
Personal
Selling
53
Roles:
Increase marketing intelligence
Locating and maintaining
customers
Generating sales at point
of
purchase
Relationship
marketing
Provide detailed
and
up-to-
date information to the travel
trade
Personal
Selling
54
Objectives
Sales
volume
Cross-selling, Up-selling,
and
Second- chance
selling
Marketing share
Product-specific
objectives
Personal
Selling
55
Cross-selling
offering a customer
the
opportunity
to
purchase
allied
products that
go
beyond
the
obvious
core
products
Up-selling
upgrading price and
profit
margins
by
selling higher-priced products
Second-chance
selling
trying to sell additional services to a customer
who
has
already
booked
services
P
e
r
s
o
n
a
l
S
e
l
l
i
n
g
:
S
a
l
e
s
m
a
n
a
g
e
m
e
n
t
56
The
management
of the
sales
force
and
personal
selling efforts
to
achieve desired sales
objectives
Roles include:
recruiting
training
motivating/rewarding
sales planning
evaluating sales performance
Personal Selling
disadvantages
57
Can only deal
with
a small
number
of
potential
customers.
More
costly
on a
per-
customer
basis.
A bad salesperson can
damage
a
relationship
Sales
Promotion
58
Sales
Promotion
consists
of
short-
term incentives to
encourage
the purchase
or sales
of a
product.
Sales
Promotion
59
It’s
a
blend
of
marketing activities
and
material
that
are designed
to
intensify the
efforts of the
company’s salesforce,
induce
intermediaries
to
stock
and
sell the company’s product,
and/or persuade
consumers to
buy
the
product
limited
in
time
period
Sales
Promotion
60
A technique used
to
increase the
value of its product by offering an
extra incentive to purchase the
product
Short-term incentives to encourage
the
purchase or sales of product or
service
Directed at consumer (samples,
coupons, rebates, contests,
demonstrations)
and
trade (free
goods, contests, family
trips)
Sales
Promotion
61
Increase short-term sales or help build
long-term market share.
Get consumers to try a new product
Attract customers away from a competitor
In general, sales promotion should focus on
consumer relationship building
.
Sales
Promotion
62
Sales
promotion
methods are
aimed
at
three target
groups,
namely
consumers
(consumer
promotion),
salespeople
(salesforce
promotion) and
intermediaries (trade
promotion)
2
3
Effective sales
promotion
64
Short duration
Dificult to imitate
by
competitors
Difficult to
predict
Directed
at and
restricted to
specific
segments
Effective sales
promotion
65
Short duration: customers must
not be able to postpone buying
decisions . If the promotion is too
long, customers will also perceive it
as part of the standard price.
Effective sales
promotion
66
Difficult to imitate
by
competitors
–
for
example airlines
that
arranege
co-operative
promotions
linking
a
particular
hotel,
car rental
company or
restaurant…
Effective sales
promotion
67
Difficult to
predict –
if
customers
can
predict
sales
promotions, they may
simply
postpone
their
buying decision.
Effective sales
promotion
68
Directed at and restricted to specific
segments – this is to avoid
the
diluition
of total sales revenue which occurs if
unnecessary incentives are offered to all
customers, some
of
whom intended
to
buy without the
added
incentive. For this
reason airlines that offer sales
promotions on overseas trips would
specify a
minimum
stay
at
the
destination (often 7 days or more), to
avoid having business travellers using
the
promotion.
Public
Relations
69
Public
Relations
Involves
Building
Good
Relations With
the
Company’s
Various Publics
by
Obtaining Favorable Publicity, Building
Up a Good
Corporate
Image, and
Handling
or
Heading
Off
Unfavorable Rumors,
Stories,
and
Events.
Public
Relations
70
The
activities
that a
tourism
or
hospitality organization uses to maintain
or
improve
its relationship with
other
organizations
or
individuals
Public
Relations
71
Functions
of
PR
Departments
72
Establishing
corporate
identity
Government
relations
Crisis
management
Internal
communications
Customer relations
Press Relations
Product
Publicity
Corporate Communication
Lobbying
Counseling
Public
Relations
73
Build
Awareness, comprehension,
positive attitude.
Build
Credibility
Stimulate the Sales Force and
Channel Intermediaries
Sales-and-Profit Contribution
Public Relations Techniques Available to the Tourism
and
Hospitality
Industry
74
Public
Relations
75
Read Public relations
text….
Direct
Marketing
76
It’s
the use of
advertising
methods
(for
example, mail,
mass
media, telephone
or
intecative devices) to handle all
or some
portion
of the
selling
process
handked
by
personal,
face
to
face
contact.
Consider
Internet
Impact
Direct
Marketing
77
Direct marketing is
an
interactive
system
of
marketing which uses
one
or more
advertising media to
effect a
measurable
response
and/or
transaction at
any
location.
Mass Marketing
and Direct
Marketing
Most Mass
Marketing Involves
One-Way
Communications
Aimed
At
Consumers.
Direct Marketing
Involves
Two-
Way
Interactions
With
Customers.
78
Advantages
of Direct
Marketing
79
Precision targeting
Personalization
Flexibility
Privacy
Measurability
Low cost
Detailed
knowledge of
consumers
Fast
or
immediate
response
D
irec
t
Kiosk
M
ar
k
eti
n
g
Online
M
ar
k
eti
n
g
Telemarketing
D
irect
-
R
es
pon
s
e
TV
Marketing
C
atal
o
g
F
ace
-
t
o-
F
ac
e
Selling
Forms
of
Direct
Marketing
80
Direct
Marketing
81
Read direct marketing
text….
Learn about the significance and functions of marketing research, understand the core concepts, definitions, and features of this crucial business activity. Discover how marketing research helps in making informed decisions and enhancing market intelligence.
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INTRODUCTION TO MARKETING RESEARCH
CONCEPT OF MARKETING RESEARCH According to Henry Mintzberg, a manager performs interpersonal, informational & decision making or disturbance handling roles. But in absence of exact accurate information, there are all the more chances to have taken a wrong decision. It takes years to get a customer and it takes second to lose one. In Second words of marketing research means gathering, recording, collecting, analyzing and interpreting the data collected are the activities done in marketing research.
Definitions: Marketing is the activity, set of institutions and process for creating that have value for customers, client, partners and society. The word Re in search suggests the continuity required for research effort, as market evolves, changes, discards, adopts, newer futures in the product offerings, answering customers choices is again a task of marketing research IMRB international, TNS India and Synovate India are some of the top market research companies.
Marketing wants precise answers & emerging trends on 1. Who ( The target customer ) 2. Why ( Features, decision process, role of influencers & information ) 3. What ( Product choices, elementof individuality & loyalty ) 4. Where ( Distribution channel made use of, impact of relations etc. ) 5. When ( Trends in purchase pattern seasonality, cyclicality, irregularity or festival impact of social events ) 6. How ( Choices of all four Ps )
FUNCTIONS OF MARKETING SEARCH. It enables getting information for effective decision making. It helps in preserving historical records and marketing knowledge. Managing research process in totality. Becoming light bearer in terms of market expenditure. Making market intelligence available to all the departments as a central resources. Ensuring research design to be in line with research objectives. Integrating research activities, so that all the departments can avail crucial relevant information
FEATURES OF MARKETINGRESEARCH Features of marketing research are as follows. Variety of methods. Art-Science Scientific basis of collection and individual ability or art in finding solutions. Applied research. A Package. Phases. Process cum tool. Fills and links the market gaps. Advantage : Company Consumer. Strategy or Trade Secret. No Auto mode Self corrections. New borne Wide acceptance. Systematic, Objective & accurate.
IMPORTANCE OF MARKETINGRESEARCH Large spending & inbuilt expectation of return on investment expenditure Confident step forward Meeting marketing objectives Helps in decision making Finding solution to marketing problems New markets or avenues Key questions get answered
SCOPE OF MARKETING RESEARCH Scope of marketing research is very wide & broad. Sales Research. Market Research. International Marketing Research. Product Research. Pricing Research. Distribution Research. Advertising Research.
Media Research ConsumerResearch PackagingResearch Motivationresearch Policy research
Sales Research: Data compared between inter-territorial zones & intra-territorial zones. Its shows change in tastes and preferences of customer. Survey of Sales people and future demand, change required in selling method etc. can be known through such research. o Marketresearch: A firm operates in a market environment which consist of competition. Different prices, strategies of competitor & result impact in sales etc. are assessed through market research. Sales territories, sales quotas and sales targets can be fixed with such research.
International Marketing research: Opportunity in one country may die down, whereas the same product in other country can be high demand. Environmental threats and opportunity profile can be created and SWOT analysis for entering various global markets can be prepared. The decision can be achieved through international marketing research by studying consumption patterns abroad, competition, consumers from foreign countries, governmental role and impact on sales, alliances or full fledged operations.
Product Research: It studies the impact of change in product design, colour, size, shape, quality, packaging, brand name, price sensitivity, accessories, attachments and price of product on sales. Innovation, modification, product life cycle based strategies, classification of products as per BCG matrix facilitated through product research. o PricingResearch: It is studies of pricing of product. It selects a suitable method of pricing. It fix the price of the product. It compares the company s product price with price of competitor's. It also fixes the discount & commission which are given to middlemen.
Distribution Research: It includes answers of questions such as 1. How the product reaches to the customer ? 2. Are there region wise prefers ? 3.Do they prefer to purchase products from retailer or do they go for online purchase or do they have any prefers for distributors ? Advertising Research: it is studies about advertising of the product. It fixes the advertising objectives. It also fixes the advertising budget. It decides about advertising message, layout, copy, slogan , headline etc. It selects a suitable media for advertising o
Media Research: In media research Ad. budget, campaigns, promotional strategies & its impact on sales is assessed of media like TV, Radio, Newspaper, Magazines, Internet etc. Media cost, media planning and sales promotional planning are facilitated with it. Effectiveness of media, timing of advertising are answered with this research. o Consumer Research: Consumer s needs changes in them cyclicality, seasonality, irregularity, like-dislike, awareness level, interest & desire in purchase action, purchasing attitude, impact of demographics like age, gender, income, location, buying motives etc.
Packaging Research: Ease, attractiveness, level of value creation, packaging cost and relevant packaging material gets decide due to packaging research. The packaging should be for better handling or storage. Customer prefers packaging for ease and its attractiveness. o Motivation Research: Buying motives, rationale behind buying influence and impact of sales promotion on sales is measured through marketing research. o Policy Research: marketing polices, inventory polices, sales policies, distribution policies, pricing policies etc allows a company to from streamlined policies
MARKETING RESEARCH PROCESS.
Data Collection Define the Problem. Data Processing Sample Respondents Primary Survey Analysis of Data Finalising Objective Drafting Preparing Questionnaire Research Report Presenting finding for decision, following Sourcing out Data Research Design
Define the problem: The first step in a marketing research process is to identify the problem or opportunity. The problem may be about decrease in sales, increase in competition, expansion of market, etc. Primary Survey: It makes a point to ask a question, whether the problem is an outcome or is it a cause. even if it being a cause its aggravation could be due to several other serve factors. Stopping at out comes does not help in digging out the exact problem or concerns. Finalising objective: After the survey, the researcher comes to know the cause behind the situation. In this stage its like a flow chart which is finding result of various causes and its varying level of impact leading to problem.
Sourcing out data: The researcher first collects secondary data. This is because it is easily available and less costly. It is collected by Desk Research. Desk Research can be internal for e.g. collected from company's records or external i.e. acquired from libraries, trade journals, government sources, etc. If the secondary data is not sufficient to solve the marketing problem, then primary data is wheeled. Collecting primary data is very costly and time consuming. It can be collected by using survey methods, i.e. by doing personal interviews, telephone interviews and mail surveys. It canalso be collected by using observational method and experimentation method.
Research Design: Research design is a plan for conducting a research. It guides the researcher in data collection. It gives proper direction to the research. Preparing Questionnaire: In this stage, primary data is collected with the help of a questionnaire. So the researcher has to prepare a questionnaire. A questionnaire is a list of questions. These questions are asked to the respondents for collecting data. The questionnaire must be suitable so that the require data is collected easily, quickly and correctly. It is used for conducting person interview, telephone interviews and mail survey. The researcher must decide about the type of the information required, the type of questioned to be asked, the wordings of the questionnaire, its order, etc.
Sample Respondents: Ensuring no lapses in structure or wording of questionnaire, a dry run or rehearsal is attempted. This stage is also known as pilot survey. Data Collection: Data can be collected such as mail survey method, with help of trained interviewers in case of personal interview method. Collected data should be reliable, magnifiable, sufficient & complete.
Data Processing: collected data is processed for drawing out larger picture. Classification of data, scrutiny of data, editing, coding etc are done in this stage. It is arrangement & processing of data for analysis. Analysis and interpretation of data: In this stage, the researcher analyzes and interprets the data. That is, he studies the data very careful and draws conclusions from it. These conclusions are then used to solve the marketing problem.
Drafting Research report: In this stage, the researcher prepares the final research report. This report contains a title of the report, method used, findings, conclusions and suggestions about how to solve the marketing problem. The language of the report must not be very difficult. The report must be submitted to the marketing executives for recommendations and implementation. o Presenting finding for decision, following: Finally, the last step in a marketing research process is to do a follow up. In this stage, the marketing executive makes changes in the product, price, marketing policies, etc. as per the recommendations of the report. Here, the researcher should find out, whether his recommendations are implemented properly or not. He should also figure-out, whether the marketing problem is solved or not.
LIMITATIONS OF MARKETING RESEARCH. Limitations of Marketing Research are as follows: No Auto mode or readymade solution. Not a one size fits all. Data dependent. Not Dynamic as the world out there is. Can avoid a risk, but not without a cost .
Not an effective prediction. Dependence on skilled researcher. Customers and competitors make the environment Applicability is the key. Old data = No data. Communication is Important Urban Rural disparity Back to square one
Managing Marketing Information Systems and Marketing Research
Why Small Businesses Need Marketing Information System? The advantages of having an effective information system are 1. Organized collection and storage of data in the Organization 2. Reduced information searching time and cost 3. Speed up obtaining relevant information sufficiently to make decisions 4. Ability to forecast future market status 5. Provides a competitive advent
What is an Information System (IS)? An information system is a set of interrelated components that collect, process, store and disseminate information to the parties who make decisions regarding the business.
Marketing Information System (MKIS) A marketing information system is a kind of information systemwhich gathers and stores data on marketing. A Marketing Information System (MKIS) is a collection of people, equipment's, and procedures to collect, sort, analyze, evaluate and distribute needed information in timely and accurate manner to the marketing decision makers (Kotler & Armstrong, 2013). This consist four steps. Access information needs Develop needed information Analyze information Distribute information for decision makers
Internal Records System In a small business organization, the records are kept about Orders sales prices of the products customercomplaints receivables the creditors. These records are called as internal records. from debtors and payable to These records can be maintained either manually or using computer data bases. Ex-:You may have seen small grocery shopsmaintain small invoice books as record of sales. That is one example for maintenance of an internal record in a small business.
Marketing Intelligence System Internal records system provides data for day today decision making. But a Marketing intelligence system provides predictive data relating to a particular situation. It is defined as a system which produces everyday informationaboutthe changes in the marketingenvironment. the sources of marketing intelligence system Newspapers Magazines trade publications talking tocustomers suppliers and distributors A small business organization can keep manual records of data generated through this type of system for effective decision making.
Marketing Decision Support Analysis The next component of MKIS is Marketing Decision Support Analysis . These are tools which can be used to analyze to make effective marketing decisions. Marketing decision support analysis tools include computer software like Geographic Information System (GIS) to track inventory details of the product dealers. Further, this includes statistical tools like time series sales modes, linear programming, elasticity models (price, incomes, demand, supply,etc.), spreadsheet 'what if models . These information help marketers to make decisions on market segmentation, pricing policies, budgeting, etc.
Marketing Research System The purpose of conducting a marketing research is to gather information regarding a specific marketing problem of the business. An organization can conduct research by using a research team in the outsourcing it to the research firm. organization itself or
Marketing Research Process Marketing research design, collection, analysis and reporting of data relevant to a specific marketing situation. is a process of systematic According to Kotler and Armstrong (2014) marketing research process has four steps which can be briefly discussed as follows. Defining the problem and researchobjectives Developing the research plan to collect information Implementing the research plan - collecting and analyzing thedata Interpreting and reporting the findings
01.Defining the problem and research objectives This is the first and most often the hardest step in the marketing research process. Most often the business owners may be aware that something is wrong, but they may fail to know the exact cause for the problem. Forexample, Would a 10 percent decrease in the price of a product result in attraction of more customers to offset the impact of pricereduction? Therefore, in such a situation the determination of research problem and objectives will guide the entire process. It is very important to identify the real problem apart from symptoms of the problem.
02.Developing the research plan to collect information This plan should basically outline the sources of information, contact methods, sampling methods and the tools that should be used to gather new data. When collecting information, businesses can refer both primary and secondary data sources. Primary data includes the information collected for a specific purpose at hand whereas. secondary data includes information that has been already collected for any other purpose. survey method, observation, interviewing customers, mystery shopping are the methods used to collect primary data. The secondary data can be collected via referring paper articles, magazines, data from department of census and statistics, central bank reports, trade journals, etc.
03.Implementing the research plan - collecting and analyzing the data This is the stage in which the research plan is actually put into action where the actual data collection and analysis would take pace. In this step the organizations will be able to uncover some of the problems that might have happened in the previous stage such as problems of interacting with the respondents, quality of participants responses, mistakes happened in the interviews etc. Accordingly, after analyzing the collected data the business owners will be able to identify and isolate important insights which will be helpful in decisionmaking.
04.Interpreting and reporting the findings Interpretation of the findings is an important but tricky task. This is mainly because the interpretation of the analysis will depend on a number of factors such as the knowledge of the interpreter regarding the subject and the accuracy and relevance of information. Thus, it is advisable to take the advice of the experts in interpreting the results and drawing conclusions based on them.
Obstacles of Maintaining an Effective Marketing Information System in a Small Business But maintaining an effective information system in a small-scale business is not an easy task due to many reasons. Lack of knowledge on importance of MKIS amongsmall business owners Lack of human resources to maintain an effective MKIS system Short term business focus . Lack of awareness on how to maintain a MKIS system.
Integrated Marketing Communications Personal selling Advertising Sales promotion Public relations Direct marketing BASIC ADAPTABLE 42
Setting the Promotion Mix Reach Many Buyers, Repeat Message Many Times, Impersonal, Expensive Reach Many Buyers, Repeat Message Many Times, Impersonal, Expensive Personal Interaction, Relationship Building, Most Expensive Promo Tool Wide Assortment of Tools, Rewards Quick Response, Efforts Short-Lived Very Believable, Dramatize a Company or Product, Underutilized Nonpublic, Immediate, Customized, Interactive Advertising Advertisin g Persona l Selling Sales Promotio n Public Relation s Direct Marketin g Personal Selling Sales Promotion Public Relations Direct Marketing Personal Interaction, Relationship Building, Most Expensive Promo Tool Wide Assortment of Tools, Rewards Quick Response, Efforts Short-Lived Very Believable, Dramatize a Company or Product, Underutilized Nonpublic, Immediate, Customized, Interactive 43
Factors in Setting Promotion Mix Buyer State Liking, Preferences, and Conviction Purchase Product-Life-Cycle Stage Introduction Growth Mature Decline 44
Advertising Advertising is Any Paid Form of Nonpersonal Presentation and Promotion of Ideas, Goods, or Services by an Identified Sponsor. 45
Advertising Its function is to inform consumers about product differences, new products and application possibilities. 46
Advertising It plays a role in the competitive process by firstly bringing differences in products or services to the attention of the consumer. Secondly, it persuades consumers to prefer on company s product to those of another. Thirdly, It creates value by its communication strategy. 47
Main Advertising Objectives Informative Advertising Persuasive Advertising Reminder Advertising 48
Characteristics of Advertising One way communication It deals with thousands of consumers and each one receives the same mesage. Depends on symbols: brand logos Low-cost mass communication Persuasive communication 49
Advertising media Newspapers Magazines Television Direct mail Radio Etc 50
