Introduction to Marketing Research

Lesson #01: An Overview of Marketing Research

Introduction
Marketers need information for decision making. They need information about consumers and
their reactions to various products, prices, distribution, and promotion strategies. They also need
information about competitors and other uncontrollable environmental factors. This information
should be gathered regularly from the internal and external sources. To ensure continuous
availability of information, an organization must establish an effective marketing information
system. Marketing Research is one of the most effective tools that help an organization to access
information that is vital for decision making. The primary objective of conducting marketing
research is to support marketing decisions. This opening lesson introduces you to the meaning of
marketing research and its importance. It also describes different types of marketing research and
its applications.

Learning Objectives
By the end of this lesson you should be able to:
Define Marketing Research
Explain the role of marketing research
Describe different types of marketing research
State the applications of marketing research

What is Marketing Research?

Marketing Research is the systematic and objective process of collecting, recording and
analyzing data to generate information relating to a specific functional area of marketing.

Marketing research is an essential problem solving and decision-making tool. It generates

information that can aid to solve marketing problems or make marketing decisions. It provides
information which reduces business risk.

Activity
In a group of five people think of marketing functions and identify the functional areas of
marketing that utilize Marketing Research?

Features of Marketing Research

 1) It is a process: It involves various steps for gathering, recording and analyzing of data
2) Search for data: It is a search for data which are relevant to problems of specific
functional areas of marketing. For example, consumer behaviour, product, sales,
distribution channel, pricing, and physical distribution.

3) It is systematic: All stages of the marketing research must be formalized and carried out
in a logical manner. For instance, one should, start with a concise statement of the
problem to be investigated; define the methods to be adopted to collect those data;
specify the relevant technique to be employed for analyzing the data; and finally state the
research findings and their specific implications for marketing decisions making.

4) It is objective and specific: The whole process should be planned with a clear objective.
Marketing research should be focused and conducted for specific issues.

Importance of Marketing Research

Scenario 1
Yesterday and Today is a studio album by the Beatles. In 1966, Capitol Records released the album
with the cover shown in figure 1. Do you think it was well received?
 Figure 1: The Original Album Cover released
in 1966 Figure 2: The New Album Cover
It was not. The public was shocked.
Capitol Records quickly realized it had made a mistake, recalled the albums, and pasted a different
cover over what became known as the butcher cover. shown in figure 2.
Source: Wikipedia.
Lesson: A little marketing research would
have helped.

Marketing research may be conducted for different purposes and is applicable to any area of
marketing. For example product management, sales, advertising research, etc. Marketing
research can help the business to:
1) Investigate the reasons for failure of a product in the market.
2) Identify opportunities in the market
3) Estimate the potential market for a new product to be introduced in the market.
4) Identify market segments for your product
5) Develop product ideas and designs

6) Assess the reactions of the consumers to a product already existing in the market.
7) Find out the general market conditions and tendencies.

8) Find out the better methods of distributing the products to consumers.

9) Know the types of consumers buying a product and their buying motives

10) Solicit consumers opinions about the product and to get their suggestions for
improvement

11) Measure the satisfaction of your customers

12) Test the effectiveness of a particular promotion campaign

13) Assess the strength and weakness of the competitors.

14) Estimate the market share of the business.

 15) Estimate future sales of a firm.

Circumstances under which Marketing Research may not be Necessary

a) If the information is available
b) If time is not sufficient
c) If resources are not available
d) If the cost exceeds value of the research
e) If the outcomes are known

Types of Marketing Research

Marketing Research can be classified into broad categories: Basic Research and Applied
Research.

a) Basic Marketing Research also known as pure research is the type of research
undertaken to generate or advance marketing knowledge in general. This type of research
reveals information that could be useful at a later date. For example, a company may
conduct basic research about consumer preferences for different beverage flavours.
Alternatively, the researcher may conduct basic research to identify the primary
consumers of a particular product or brand.
b) Applied Marketing Research is the type of research undertaken to seek solution to a
specific marketing problem. For example, a company may be losing customers but
managers are not sure why. Applied marketing research can be used to explore some of
the possible causes of customers. Understanding why individuals watch the Super Bowl
football game is another example of applied research.

Applications of Marketing Research

Marketing research plays a role in a number of marketing areas as follows:

1) Market segmentation and targeting: Marketing research provides essential

information for decisions on segmentation and targeting. It provides basic demographic,
geographic, psychographic, and behavioral information about specific target markets.
 2) Product Development: Marketing research is used in all stages of product development.
Research can be used in the concept stage to gather customer input on ideas for a new
product or modifications of a current product.

3) Marketing Communications and Media Selection: Marketing research can provide

valuable information concerning marketing communications and media selection. For
example, advertising effectiveness research examines the effectiveness of advertising and
marketing communications.

4) Market and Competitive Analyses: Marketing research provides essential information

about the current marketing situation faced by a company. It is also used to gather
information about competitors.

5) Pricing and Forecasting: Marketing research can provide valuable information that can
be used to evaluate the elasticity of price and the impact of price changes on demand.

6) Site Selection and Distribution: Marketing research provides essential information

that can be used to determine the best locations for business.

Review Questions

1) What is Marketing Research?

2) Why is marketing research necessary for a business company?

3) List down areas in marketing where Marketing Research would be helpful

4) What is the difference between pure and applied research? Can you give an example?

5) Under what circumstances marketing research may not be necessary?

 6) Can you provide five examples of marketing research?

Individual Assignment 1

Marketing research can help businesses to answer crucial questions relating to marketing. List
any ten (10) crucial questions that can be answered by utilizing marketing research.