Test on Chapter 5 – Flashcards

A. Marketing research is the systematic design, collection, interpretation, and reporting of information to help marketers solve specific marketing problems or take advantage of marketing opportunities. 1. It is a process for gathering information not currently available to decision makers. 2. The purpose of marketing research is to inform an organization about customers' needs and desires, marketing opportunities for particular goods and services, and changing attitudes and purchase patterns of customers. B. Marketing research can help a firm better understand market opportunities, ascertain the potential for success for new products, and determine the feasibility of a particular marketing strategy C. Marketing research is used by all sorts of organizations to help develop marketing mixes to match the needs of customers. D. Changes in the economy have changed marketers' decision making strategies to focus more on small-scale surveys and short-range forecasting. Businesses need speed and agility to survive and to react quickly to changing consumer behavior. E. The real value of marketing research is measured by improvements in a marketer's ability to make decisions. 1. Marketers should treat information in the same manner as other resources utilized by the organization, and must weigh the costs of obtaining information against the benefits derived. 2. Information should be judged worthwhile if it results in marketing activities which improve the organization's ability to satisfy its target customers, leads to increased sales and profits, or helps the organization achieve some other goal.

yields descriptive non-numerical information.

yields empirical information that can be communicated through numbers.

1. When marketers need more information about a problem or want to make a tentative hypothesis more specific, they conduct exploratory research. 2. More organizations are starting customer advisory boards, which are small groups of actual customers who offer insights into their feelings and attitudes toward a firm's products, promotion, pricing, and other elements of marketing strategy.

brings together multiple people to informally discuss a certain topic in a group setting led by a moderator. a. Focus groups allow customer attitudes, behaviors, lifestyles, needs, and desires to be explored in a flexible and creative manner. b. They can provide companies with ideas for new products or be used for initial testing of different marketing strategies for existing products. c. A current trend is online focus groups in which participants sign in to a website and type their comments and responses. (1) Online focus groups can gather data from large and geographically diverse groups in a less intensive manner than focus-group interviews. (2) This method makes it more difficult to ask participants about a product's smell or taste or observe the participants' nonverbal cues and body language. d. Focus groups do have a few disadvantages, including personality issues with participants and difficulties with motivating honest feedback. For these reasons, focus groups are best used to uncover issues that can then be explored using quantifiable marketing research techniques.

verifies insights through an objective procedure to help marketers make decisions; it is used when the marketer has in mind one or more alternatives and needs assistance in the final stages of decision making.

If marketers need to understand the characteristics of certain phenomena to solve a particular problem, descriptive research is a good aid. a. Descriptive studies can range from general surveys of customers' educations, occupations, or ages to specifics on how they use products or how often they purchase them. b. Descriptive studies generally demand in-depth knowledge and assume the problem or issue is clearly defined.

allows marketers to make causal deductions about relationships. a. Experiments involve manipulating an independent variable and measuring the resulting changes in a dependent variable. b. Experimental research can provide much stronger evidence of cause and effect than data collected through descriptive research.

To maintain the control needed to obtain accurate information, marketers approach marketing research as a process with logical steps. These steps should be viewed as an overall approach to conducting research rather than as a rigid set of rules to be followed in each project.

1. The first step in launching a research study is problem or issue definition, which focuses on uncovering the nature and boundaries of a situation or question related to marketing strategy or implementation. The first sign of a problem is typically a departure from some normal function, such as conflicts between or failures to attain objectives. 2. Marketing research often focuses on identifying and defining market opportunities or changes in the environment. When an organization discovers a market opportunity, it may need to conduct research to more precisely understand the situation so it can craft an appropriate marketing strategy. 3. To pin down the specific boundaries of a problem or an issue through research, marketers must define the nature and scope of the situation in a way which requires probing beneath superficial symptoms.

Once the problem or issue has been defined, the next step is research design, an overall plan for obtaining the information needed to address it. This step requires formulating a hypothesis and determining what type of research is most appropriate for testing the hypothesis.

a. A hypothesis is an informed guess or assumption about a certain problem or set of circumstances. b. The hypothesis is based on all available insight and knowledge about the problem or circumstances from previous research studies and other sources. c. Sometimes several hypotheses are developed during a research project; these accepted or rejected hypotheses become the study's chief conclusions

a. In designing research, marketing researchers must ensure that research techniques are both reliable and valid. b. A research technique has reliability if it produces almost identical results in repeated trials. c. To have validity, the method must measure what it is supposed to measure, not something else.

The next step in the marketing research process is collecting data to help prove or disprove the research hypothesis. The research design must specify the types of data to collect and how the data is collected.

a. Primary data are observed and recorded or directly collected from respondents. This type of data must be gathered through observation or by surveying people of interest. b. Secondary data are compiled inside and outside the organization for some purpose other than the current investigation.

a. Marketers often begin the data collection phase of the marketing research process by gathering secondary data b. Internal sources of secondary data can include the organization's own database, which may contain information about past marketing activities, as well as accounting records. c. External sources of data include periodicals, government publications, unpublished sources, online databases, or outside services. d. Technologies like TiVo and services provided on the Internet are challenging traditional sources of secondary data by offering year-round, up-to-the-minute data.

The collection of primary data is a more lengthy, expensive, and complex process than the collection of secondary data.

Because the time and resources available for research are limited, it is almost impossible to investigate all members of a target market or other population. (a) A population, or "universe," includes all the elements, units, or individuals of interest to researchers for a specific study. (b) Researchers can project the reactions of a total market or market segment by systematically choosing a limited number of units—a sample—to represent the characteristics of a total population.

is the process of selecting representative units from a total population. Most types of marketing research employ sampling techniques. There are two basic types of sampling: probability sampling and non-probability sampling.

every element in the population being studied has a known chance of being selected for study.

all the units in a population have an equal chance of appearing in the sample.

divides the population of interest into groups according to a common attribute, and then a random sample is chosen within each group.

is more subjective than probability sampling because there is no way to calculate the likelihood that a specific population element will be chosen. One type of non-probability sampling is quota sampling, in which researchers divide the population into groups and then arbitrarily choose participants from each group.

Marketing researchers often employ sampling to collect primary data through mail, telephone, online, or personal interview surveys (a) Selection of a survey method depends on the nature of the problem or issue, the data needed to test the hypothesis, and the resources, such as funding and personnel, available to the researcher. (b) Gathering information through surveys is becoming increasingly difficult because fewer people are willing to participate.

questionnaires are sent to respondents, who are encouraged to complete and return them. (a) Mail surveys are used most often when the individuals in the sample are spread over a wide area and funds for the survey are limited. (b) A mail survey is less expensive than telephone surveys, as long as the response rate is high enough to produce reliable results. (c) The main disadvantages of this method are the possibility of a low response rate and of misleading results if respondents differ significantly from the population being sampled. (d) Premiums or incentives which encourage respondents to return questionnaires have been effective in developing panels of respondents who are regularly interviewed by mail.

an interviewer records respondents' answers to a questionnaire. A telephone depth interview combines the traditional focus group's ability to probe with the confidentiality provided by a telephone survey. (a) Telephone surveys and interviews have some advantages over mail surveys, including higher rates of response, speed, and the ability to gain rapport with respondents and ask probing questions. (b) Telephone surveys and interviews have several disadvantages. (i) Few people like to participate in telephone surveys which limit participation and distort representation. (ii) Telephone surveys are limited to oral communication; visual aids or observation cannot be included. (iii)Interpreters of results must make adjustments for subjects who are not at home, do not have telephones, have unlisted numbers, or screen or block calls.

participants respond to questions face to face. (a) One such research technique is the in-home (door-to-door) interview, which takes place in the respondent's home. (b) Shopping mall intercept interviews involve interviewing a percentage of individuals passing by certain "intercept" points in a mall. (c) An on-site computer interview is a variation of the mall intercept interview, in which respondents complete a self-administered questionnaire displayed on a computer monitor.

questionnaires can be transmitted to respondents either through e-mail or through a website. (a) Because e-mail is semi-interactive, recipients can ask for clarification of specific questions or pose questions of their own. (b) The potential advantages of online surveys are quick response and lower cost than traditional mail, telephone, and personal interview surveys if the response rate is adequate.

Marketers can also use social networking sites and other digital media forums to identify trends in interests and consumption patterns. (a) Often consumers choose to go to a particular social media site or blog and then take the survey, which eliminates randomness and makes it more difficult to obtain a representative sample. (b) By "listening in" on these conversations, marketers may be able to identify new product opportunities and consumer needs. (c) This type of online data can be gathered at little incremental cost compared to alternative data sources. It is also important for organizations to harness all of their internal information, and internal social networks can be helpful.

takes tasks usually performed by a marketer or researcher and outsources them to a crowd, or potential market, through an open call. In the case of digital marketing, crowdsourcing is often used to obtain the opinions or needs of the crowd (or potential markets).

Marketing research is likely to rely heavily on online surveys in the future. here are some ethical issues to consider when using digital marketing research, such as unsolicited e-mail, privacy concerns, and obtaining a sample that is representative of the desired population.

(1) Questions must be clear, easy to understand, and directed toward a specific objective. (2) A common mistake in constructing questionnaires is to ask questions which interest researchers but yield no useful information to accept or reject a hypothesis. (3) Questions are usually of three kinds: open-ended, dichotomous, and multiple-choice. (4) Researchers must be careful not to ask questions which may be considered too personal or require an admission of activities likely to be condemned by others.

(1) researchers record individuals' overt behaviors, taking note of physical conditions and events. Direct contact with subjects is avoided. (2) Observation may include the use of ethnographic techniques, such as watching customers interact with a product in a real-world environment. (3) Observation may also be combined with interviews.

(a) An observer can be placed in a natural market environment, such as a grocery store, without biasing or influencing shoppers' actions. (b) If the presence of a human observer is likely to bias the outcome or if human sensory abilities are inadequate, mechanical means may be used to record behavior.

motivating respondents to state their true feelings or opinions. However, results tend to be descriptive

1. After collecting data to test hypotheses, marketers need to interpret research findings. 2. The first step in drawing conclusions from most research is displaying the data in table format. 3. Next, the data must be analyzed: statistical interpretation focuses on what is typical and what deviates from the average. 4. Data require careful interpretation by the marketer. 5. Managers must understand the research results and relate them to a context that permits effective decision making.

1. The final step in marketing research is to report the research findings. The marketer must take a clear, objective look at the findings to see how well the gathered facts answer the research question or support or negate the initial hypotheses. 2. The report of the research results is usually a formal, written document. 3. Bias and distortion can be a major problem if the researcher is intent upon obtaining favorable results. Marketing researchers must be very careful with their word choices.

A. Technology is making information for marketing decisions increasingly accessible. B. Consumer feedback is an important aspect of marketing research, and new technology such as digital media is enhancing this process. 1. In the case of negative feedback, marketers can communicate with consumers to address problems or complaints more easily than with traditional marketing channels. 2. Companies can understand what features of their product mixes should be promoted or modified.

1. A framework for the day-to-day management and the structuring of information regularly gathered from sources inside and outside an organization. It provides a continuous flow of information about prices, advertising, expenditures, sales, competition, and distribution expenses. 2. The main focus of the marketing information system is data storage and retrieval as well as computer capabilities and management's information requirements. 3. An effective marketing information system starts by determining the objective of the information by identifying decision needs which require certain information. The organization can then specify an information system for continuous monitoring to provide regular, pertinent information about external and internal environments.

Is a collection of information arranged for easy access and retrieval usually accessed through a computer system, allow marketers to tap an abundance of useful information to make marketing decisions. Databases may contain internal sales reports, newspaper articles, company news releases, government economic reports, bibliographies, and more. Marketing researchers can also use commercial databases developed by information research firms to obtain useful information for marketing decisions.

employs database marketing techniques to identify different types of customers and develop specific strategies for interacting with each customer. a. Identify and build a database of current and potential customers. b. Deliver differential messages according to each consumer's preference and characteristics through established and new media channels. c. Track consumer relationships to monitor the costs of retaining individual customers and the lifetime value of their purchases.

information provided by a single firm about household demographics, purchases, television viewing behavior, and responses to promotions, such as coupons and free samples.

1. involves massive data files that can be obtained from both structured and unstructured databases. Big data often consists of high volume data that marketers can use to discover unique insights and make more knowledgeable marketing decisions. Big data can include data collected from social networks, RFID, retail scanning, purchases, logistics, and production. 2. Big data is important because marketers can look at patterns of consumption behavior and discover trends that predict future buying behaviors. 3. Despite the benefits of big data to marketing research, the challenge for marketers is to figure out how to use pieces of data to develop more targeted marketing strategies. 4. Many consumers do not like to have their purchases or behaviors tracked, and sometimes using big data for marketing purposes creates conflict. 5. Big data is necessary to uncover valuable insights about customers, and marketing research firms are offering services to help organizations generate this complex information. Avoiding big data could cause a business to sacrifice a competitive advantage

customized computer software which helps marketing managers anticipate the effects of certain decisions.

1. It is essential that professional standards be established by which research may be judged reliable because marketing managers and other professionals increasingly rely on marketing research, marketing information systems, and new technologies to make decisions. 2. Organizations like the Marketing Research Association have developed codes of conduct and guidelines to promote ethical marketing research. 3. Consumer privacy has also become a significant issue as firms now have the ability to purchase and collect data on customer demographics, interests, and more personal matters. a. This information has allowed companies to predict customer behavior more accurately but also may infringe upon consumer privacy b. While such data enable companies to offer more personalized services, policy makers fear that it could also allow them to discriminate among consumers who do not appear "valuable" or use consumers' online behavior to identify them personally.

1. The marketing research process described in this chapter is used globally, but to ensure research is valid and reliable, data-gathering methods may be modified to allow for differences in sociocultural, economic, political, legal, and technological forces in different world regions. 2. Experts recommend a two-pronged approach to international marketing research. a. The first phase involves a detailed search for and analysis of secondary data to gain greater understanding of a particular marketing environment and to pinpoint issues that must be taken into account in gathering primary research data. b. The second phase involves field research using many of the methods described in the chapter, including focus groups and telephone surveys, to refine an organization's understanding of specific customer needs and preferences. (1) Specific differences among countries can have a profound influence on data gathering. (2) Primary data gathering may have a greater chance of success if the organization employs local researchers who better understand how to approach potential respondents in their own language.