Introduction to Marketing Research

Definition:

The American Marketing Association defines marketing research as:

“Marketing research is the function that 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;
monitor marketing performance; and improve understanding of marketing as a process.

Marketing research specifies the information required to address these issues, designs the
method for collecting information, manages and implements the data collection process,
analyses the results, and communicates the findings and their implications.”

Marketing Research

Problem Problem-Solving
Identification Research
Research

Market Potential Research  Segmentation Research

Market Share Research  Product Research

Image Research  Pricing Research

Market Characteristics Research  Promotion Research

Sales Analyses Research  Distribution Research

Forecasting Research

Business Trends Research

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The Marketing Research Process: It consists of six steps:

1. Problem Definition
The first step is to define the problem. In defining the problem, the researcher should take
into account the purpose of the study, the relevant background information, the
information needed, and how it will be used in decision making. Problem definition
involves discussion with the decision makers, interviews with industry experts, analysis
of secondary data, and, perhaps, some qualitative research, such as focus groups. Once
the problem has been precisely defined, the research can be designed and conducted
properly.

2. Development of an Approach to the Problem

Development of an approach to the problem includes formulating an objective or
theoretical framework, analytical models, research questions, and hypotheses and
identifying the information needed. This process is guided by discussions with
management and industry experts, analysis of secondary data, qualitative research, and
pragmatic considerations.

3. Research Design Formulation

A research design is a framework or blueprint for conducting the marketing research
project. It details the procedure necessary for obtaining the required information, and its
purpose is to design a study that will test the hypotheses of interest, determine possible
answers to the research questions, and provide the information needed for decision
making. Considering exploratory research, precisely defining the variables, and designing
appropriate scales to measure them are also part of the research design. The issue of how
the data should be obtained from the respondents (for example, by conducting a survey or
an experiment) must be addressed. It is also necessary to design a questionnaire and a
sampling plan to select respondents for the study. More formally, formulating the
research design involves the following steps:

o Definition of the information needed

o Secondary data analysis
o Qualitative research
o Methods of collecting quantitative data (survey, observation and experimentation)
o Measurement and scaling procedures
o Questionnaire design
o Sampling process and sample size
o Plan of data analysis

4. Fieldwork or Data Collection

Data collection involves a field force or staff that operates either in the field, as in the
case of personal interviewing (in-home, mall intercept, or computer assisted personal
interviewing), from an office by telephone (telephone or computer-assisted telephone
interviewing), through mail (traditional mail and mail panel surveys with pre-recruited
households), or electronically (e-mail or internet). Proper selection, training, supervision
and evaluation of the field force help minimize data-collection errors.

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 5. Data Preparation & Analysis
Data preparation includes the editing, coding, transcription, and verification of data. Each
questionnaire or observation form is inspected or edited and, if necessary, corrected.
Number or letter codes are assigned to represent each response to each question in the
questionnaire. The data from the questionnaires are transcribed or keypunched onto
magnetic tape or disks, or input directly into the computer. The data are analyzed to
derive information related to the components of the marketing research problem and, thus
to provide input into the management decision problem.

6. Report Preparation & Presentation

The entire project should be documented in a written report that addresses the specific
research questions identified; describes the approach, the research design, data collection,
and data analysis procedures adopted in a comprehensible format so that management can
readily use them in the decision-making process. In addition, an oral presentation should
be made to management using tables, figures, and graphs to enhance clarity and impact.
The internet is also being used to disseminate marketing research results and reports,
which can be posted on the Web and made available to managers on a worldwide basis.

The Role of Marketing Research in Marketing Decision Making:

Customer Groups
 Consumers
 Employees
 Shareholders
 Suppliers

Controllable Uncontrollable
Marketing Variables: Environment Factors:

 Product  Economy
 Pricing MARKETING  Technology
 Promotion RESEARCH  Competition
 Distribution  Laws & Regulations
 Social & Cultural factors
 Political Factors

Assessing Providing Marketing

Information Information Decision
Needs Making

Marketing Managers
 Market Segmentation
 Target Market Selection
 Marketing Programs
 Performance and Control 3
Marketing Research and Competitive Intelligence:

Competitive intelligence (CI) may be defined as the process of enhancing marketplace

competitiveness through a greater understanding of a firm’s competitors and the
competitive environment. This process involves the legal collection and analysis of
information regarding the capabilities, vulnerabilities, and intentions of business
competitors, conducted by using information databases and other ‘open sources’ and
through ethical marketing research inquiry.

CI enables senior managers in companies of all sizes to make informed decisions about
everything from marketing, R & D, and investing tactics to long-term business strategies.
Effective CI is a continuous process involving the legal and ethical collection of
information, analysis that does not avoid unwelcome conclusions, and controlled
dissemination of actionable intelligence to decision makers. CI is a crucial part of the
emerging knowledge economy. By analyzing rivals’ moves, CI allows companies to
anticipate market development rather than merely react to them.

The Decision to Conduct Marketing Research:

Marketing research is quite useful in a variety of situations, but the decision to conduct
research is not automatic. Rather, this decision should be guided by a number of
considerations, including the costs versus the benefits, the resources available to conduct
the research, the resources available to implement the research findings, and
management’s attitude toward research. Marketing research should be undertaken when
the expected value of information it generates exceeds the costs of conducting the
marketing research project. In general, the more important the decision confronting
management and the greater the uncertainty or risk facing them, the greater the value of
information obtained. Formal procedures are available for quantifying the expected value
as well as the costs of a marketing research project. Although in most instances the value
of information exceeds the costs, there are instances when the reverse may be true.

Resources, especially time and money, are always limited. However, if either time or
money is not available in adequate amounts to conduct a quality project that project
probably should not be undertaken. If management does not have a positive attitude
toward research, then it is likely that the project report will gather dust after the project is
conducted.

There are other instances that may argue against conducting a marketing research project.
If the required information is already available within the organization, or the decision for
which the research is to be conducted has already been made or the research is going to
be used for gaining political ends, then the value of information generated is greatly
reduced and the project is generally not warranted. However, if the decision is made to
conduct marketing research, then management may also rely on marketing research
suppliers and services to obtain the specific information needed.

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Marketing Information System (MIS):

MIS is a formalized set of procedures for generating, analyzing, storing, and distributing
pertinent information to marketing decision makers on an ongoing basis.

Decision Support Systems (DSS):

DSS are the information systems that enable decision makers to interact directly with
both databases and analysis models. The important component of a DSS includes
hardware and a communications network, database, model base, software base, and the
DSS user (decision maker).

MIS DSS

 Structured problems  Unstructured problems

 Use of reports  Use of models
 Rigid structure  User-friendly interaction
 Information displaying restricted  Adaptability
 Can improve decision making by  Can improve decision making by using
clarifying raw data ‘What If’ analysis

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 Defining a Marketing Research Problem & Developing an Approach:

Problem definition involves stating the general problem and identifying the specific
components of the marketing research problem. Only when the marketing research
problem has been clearly defined can research be designed and conducted properly. All
the efforts, time, and money spent from this point on will be wasted if the problem is
misunderstood or ill defined.

The Process of Defining a Marketing Research Problem & Developing an

Approach:

Tasks Involved

Discussions with Interviews Secondary Data Qualitative Research

Decision Makers with Experts Analysis

Environmental Context of the Problem

Step I: Problem Definition

Management Decision Problem

Marketing Research Problem

Step 2: Approach to the Problem

Objective/ Analytical Model: Research Hypotheses Specification

Theoretical Verbal, Graphical, Questions of information
Foundations Mathematical needed

Step 3: Research Design

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Tasks Involved:

Discussions with Decision Makers:

The decision maker needs to understand the capabilities and limitations of research.
Research provides information relevant to management decisions, but it cannot provide
solutions require managerial judgment. Conversely, the researcher needs to understand
the nature of the decision manager face and what they hope to learn from the research.
The problem audit provides a useful framework for interacting with the DM and
identifying the underlying causes of the problem. The problem audit is a comprehensive
examination of a marketing problem with the purpose of understanding its origin and
nature. The problem audit involves discussions with the DM on the following issues:

1. The events that led to the decision that action is needed, or the history of
the problem.
2. The alternative courses of action available to the DM.
3. The criteria that will be used to evaluate the alternative courses of action.
4. The potential actions that are likely to be suggested based on the research
findings.
5. The information that is needed to answer the DM’s questions.
6. The manner in which the DM will use each item of information in making
the decision.
7. The corporate culture as it relates to decision making.

A problem audit, which involves extensive interaction between the DM and the
researcher, can greatly facilitate problem definition by determining the underlying causes.
In order to be fruitful, the interaction between the DM and the researcher should be
characterized by the seven Cs:

1. Communication
2. Cooperation
3. Confidence
4. Candor
5. Closeness
6. Continuity
7. Creativity

Interviews with Industry Experts:

Interviews with industry experts, individuals knowledgeable about the firm and the
industry, may help formulate the marketing research problem. These experts may be
found both inside and outside the firm. Typically, expert information is obtained by
unstructured personal interviews, without administering a questionnaire. It is helpful,
however, to prepare a list of topics to be covered during the interview. The order in which
these topics are covered and questions to ask should not be predetermined but decided as

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the interview progresses. This allows greater flexibility in capturing the insights of the
experts.

Secondary Data Analysis:

Secondary data are data collected for some purpose other than the problem at hand.
Primary data, on the other hand, are originated by the researcher for the specific purpose
of addressing the research problem. Secondary data include information made available
by business and government sources, commercial marketing research firms, and
computer databases. Secondary data are an economical and quick source of background
information. Analysis of available secondary data is an essential step in the problem
definition process: Primary data should not be collected until the available secondary data
have been fully analyzed.

Qualitative Research:

An unstructured, exploratory research methodology based on small samples intended to

provide insight and understanding of the problem setting. It may utilize popular
qualitative techniques such as focus groups (group interviews), word association (asking
respondents to indicate their first responses to stimulus words), and depth interviews
(one-by-one interviews that probe the respondents’ thoughts in detail). Other exploratory
research techniques, such as pilot surveys and case studies, may also be undertaken to
gain insights into the phenomenon of interest. Pilot surveys: tend to be less structured
than large-scale surveys in that they generally contain more open-ended questions and the
sample size is much smaller. Case studies: involve an intensive examination of a few
selected cases of the phenomenon of interest. Cases could be customers, stores, or other
units.

Environment Context of the Problem:

To understand the background of a marketing research problem, the researcher must

understand the client’s firm and industry. In particular, the researcher should analyze
factors that have an impact on the definition of the marketing research problem. These
factors, encompassing the environmental context of the problem, include past information
and forecasts pertaining to the industry and the firm, resources and constraints of the firm
objectives of the decision maker, buyer behavior, legal environment, economic
environment, and marketing and technological skills of the firm.

Management Decision Problem:

Management decision problem is the problem confronting the decision maker. It asks
what the decision maker needs to do.

Marketing Research Problem:

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A problem that entails determining what information is needed and how it can be
obtained in the most feasible way.

Management Decision Problem Marketing Research Problem

It asks what the decision maker needs to do Asks what information is needed and how
it should be obtained

Action oriented: Information oriented:

• Should a new product be introduced? • To determine consumer preferences and

• Should the advertising campaign be purchase intentions for the proposed new
changed? product.
• Should the price of the brand be • To determine the effectiveness of the
increased? current advertising campaign.
• To determine the price elasticity of
demand and the impact on sales and
profits of various levels of price
changes.
Focuses on symptoms Focuses on the underlying causes

Defining the Marketing Research Problem:

The general rule to be followed in defining the marketing research problems is that the
definition should, (1) allow the researcher to obtain all the information needed to address
the management decision problem, and (2) guide the researcher in proceeding with the
project.

Broad Statement: The initial statement of the marketing research problem that provides
an appropriate perspective on the problem.

Specific Components: The second part of the marketing research problem definition. The
specific components focus on the key aspects of the problem and provide clear guidelines
on how to proceed further.

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Components of the Approach:

Objective/Theoretical Framework: A conceptual scheme based on foundational

statements, or axioms, that are assumed to be true. Objective evidence (Unbiased
evidence that is supported by empirical findings) is gathered by compiling relevant
findings from secondary sources.

Analytical Model: An analytical model is an explicit specification of a set of variables

and their interrelationships designed to represent some real system or process in whole or
in part.
• Verbal models are analytical models that provide a written representation of the
relationships between variables.
• Graphical models are analytical models that provide a visual of the relationships
between variables.
• Mathematical models are analytical models that explicitly describe the
relationships between variables, usually in equation form.

Research Questions: Research questions are refined statements of the specific

components of the problem.

Hypotheses: A hypothesis is an unproven statement or proposition about a factor or

phenomenon that is of interest to the researcher. Hypotheses go beyond research
questions because they are statements of relationships or propositions rather than merely
questions to which answers are sought. Whereas research questions are interrogative,
hypotheses are declarative and can be tested empirically. An important role of a
hypothesis is to suggest variables to be included in the research design.

Specification of Information Needed: By focusing on each component of the problem and

the analytical framework and models, research questions, and hypotheses, the researcher
can determine what information should be obtained in the marketing research project. It
is helpful to carry out this exercise for each component of the problem and make a list
specifying all the information that should be collected.

Ethics in Marketing Research:

Ethical issues arise if the process of defining the problem and developing an approach is
compromised by the personal agendas of the client (DM) or the researcher. This process
is affected when the DM has hidden objectives such as gaining a promotion or justifying
a decision that has already been made. The DM has the obligation to be candid and
disclose to the researcher all the relevant information that will enable a proper definition
of the marketing research problem. Likewise the researcher is ethically bound to define
the problem so as to further the best interest of the client, rather than the interest of the
research firm. At times this may mean making the interest of the research firm
subservient to those of the client, leading to an ethical dilemma.
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Research Design

A research design is a framework or blueprint for conducting the marketing research

project. It specifies the details of the procedures necessary for obtaining the information
needed to structure and/or solve marketing research problem. Typically, a research design
involves the following components, or tasks:

• Design the exploratory, descriptive, and/or causal phases of the research.

• Define the information needed.
• Specify the measurement and scaling procedures.
• Construct and pretest a questionnaire or an appropriate form for data collection.
• Specify the sampling process and sample size.
• Develop a plan of data analysis.

Research Design: Classification

Research Design

Exploratory Research Conclusive Research

Design Design

Descriptive Causal
Research Research
 Cross-sectional Longitudinal
Research Research

Single Multiple
Cross-sectional Cross-sectional
Research Research

Exploratory Research: A type of research design, which has as its primary objective the
provision of insights into and comprehension of the problem situation confronting the
researcher. As its name implies, the objective of exploratory research is to explore or
search through a problem or situation to provide insights and understanding. Exploratory
research could be used for any of the following purposes:

• Formulate a problem or define a problem more precisely.

• Identify alternative courses of action.
• Develop hypotheses.
• Isolate key variables and relationships for further examination.
• Gain insights for developing an approach to the problem.
• Establish priorities for further research.

Conclusive Research: Research design to assist the decision maker in determining,

evaluating, and selecting the best course of action to take in a given situation.

Difference between exploratory and conclusive research

Exploratory Conclusive

Objective:  To provide insights and  To test specific

understanding hypotheses and examine
relationship.
Characteristics:  Information needed is defined  Information needed is
only loosely. clearly defined.
 Research process is flexible  Research process is formal
and unstructured. and structured.
 Sample is small and non-  Sample is large and
representative. representative.
 Analysis of primary data is  Data analysis is
qualitative. quantitative.
Findings/Results:  Tentative.  Conclusive.
Outcome:  Generally followed by further  Findings used as input into
exploratory or conclusive decision making.
research.

Descriptive research: A type of conclusive research that has as its major objective the
description of something – usually market characteristics or functions. Descriptive
research is conducted for the following reasons:

• To describe the characteristics of relevant groups e.g. heavy users

• To estimate the percentage of units in a specific population exhibiting certain
behaviour e.g. the percentage of heavy users of Big Bazaar who also patronize Dollar
Shop.
• To determine the perceptions of product characteristics e.g. how do household
perceive the various departmental stores in terms of salient factors of the choice
criteria?
• To determine the degree to which marketing variables are associated e.g. to what
extent is shopping at department stores related to eating out?
• To make specific predictions e.g. what will be the retail sales of a specific store
for specific product category in a specific region?

A descriptive design requires a clear specification of: the who, what, when, where, why,
and in what way (the six W’s) of the research. In brief, descriptive research, in contrast to
exploratory research, is marked by a clear statement of the problem, specific hypotheses,
and detailed information needs. Other examples of descriptive research are: Market
studies, Market Share studies, Sales analysis studies, Image studies, Product usage
studies, Distribution studies, Pricing studies, Advertising studies etc.

A Comparison of Basic Research Designs

Exploratory Descriptive Causal

Objective:  Discover ideas and  Describe  Determine
insights. market cause and effect
characteristics or relationships.
functions.
Characteristics:  Flexible  Marked by the  Manipulatio
 Versatile. prior formulation n of one or
 Often the front end of specific more
of total research hypotheses. independent
design.  Preplanned variables.
and structured  Control of
design. other mediating
variables.
Methods:  Expert surveys  Secondary  Experiments.
 Pilot surveys data: analyzed
  Secondary data: quantitatively.
analyzed  Surveys
qualitatively.  Panels
 Qualitative  Observational
Research. and other data.

Cross-sectional Design: A type of research design involving the collection of information

from any given sample of population elements only once.

Single Cross-sectional Design: A cross-sectional design in which one sample of

respondents is drawn from the target population and information is obtained from this
sample once.
Multiple Cross-sectional Design: A cross-sectional design in which there are two or more
samples of respondents, and information from each sample is obtained only once. One
type of multiple cross-sectional design of special interest is cohort analysis.

Cohort Analysis: A multiple cross-sectional design consisting of a series of surveys

conducted at appropriate time intervals, where the cohort serves as the basic unit of
analysis. The cohort refers to the group of respondents who experience the same event
within the same time interval. For example, a birth (or age) cohort is a group of people
who were born during the same time interval, such as 1951 through 1960.

Longitudinal Design: A type of research design involving a fixed sample of population

elements that is measured repeatedly on the same variables. The sample remains the same
over the time, thus providing a series of pictures which, when viewed together, portray a
vivid illustration of the situation and the changes that are taking place over time.

Sometimes, the term panel is used interchangeably with the term longitudinal design. A
penal is a sample of respondents who have agreed to provide information at specified
intervals over an extended period.

Relative Advantages and Disadvantages of Longitudinal and Cross-sectional Designs:

Evaluation criteria Cross-sectional Design Longitudinal Design

Detecting changes - +
Large amount of data - +
Accuracy - +
Representative sampling + -
Response bias + -

Note: A + indicates a relative advantage over the other design, whereas a – indicates a
relative disadvantage.

The main disadvantage of panels is that they may not be representative because of:
 • Refusal to cooperate – panel members may refuse to cooperate and may not wish
to be bothered
• Mortality – panel members may move away or lose interest
• Payment – certain types of people may become members of panel for payment
making group of people unrepresentative.

Causal Research: A type of conclusive research where the major objective is to obtain
evidence regarding cause-and-effect (causal) relationships. Marketing managers
continually make decisions based on assumed causal relationships. These assumptions
may not be justifiable, and the validity of the causal relationships should be examined via
formal research. Causal research is appropriate for the following purposes:

• To understand which variables are the causes (independent variables) and which
variables are the effects (dependent variables) of a phenomenon.
• To determine the nature of the relationship between the causal variables and the
effect to be predicted.

Relationships among exploratory, descriptive and causal research: The distinctions

among these classifications are not absolute. The following guidelines are useful for
choosing research designs:

• When little is known about the problem situation, it is desirable to begin with
exploratory research.
• Exploratory research is the initial step in the overall research design framework. It
should, in most instances, be followed by descriptive or causal research.
• It is not necessary to begin every research with exploratory research. It depends
upon the precision with which the problem has been defined and the researcher’s
degree of certainty about the approach to the problem. A research design could well
begin with descriptive or causal research.
• Although exploratory research is generally the initial step, it need not be.
Exploratory research may follow descriptive or causal research.

Potential Sources of Error: Several potential sources of error can affect a research design.
The total error is the variation between the true mean value in the population of the
variable of interest and the observed mean value obtained in the marketing research. The
total error is composed of:

• Random Sampling Error: the error due to the particular sample selected being an
imperfect representation of the population of interest. It may be defined as the
variation between the true mean value for the sample and the true mean value of the
population.
• Non-sampling Error: these are the errors that can be attributed to sources other
than sampling, and they can be random or nonrandom.
 • Non-response Error: A type of non-sampling error that occurs when some of the
respondents included in the sample do not respond. This error may be defined as the
variation between the true mean value of the variable in the original sample and the
true mean value in the net sample.
• Response Error: A type of non-sampling error arising from respondents who do
respond, but give inaccurate answers or their answers are misrecorded or
misanalyzed. It may be defined as the variation between the true mean value of the
variable in the net sample and the observed mean value obtained in the marketing
research project.

Errors made by the researcher include:

• Surrogate Information Error: It may be defined as the variation between the

information needed for the marketing research problem and the information sought by
the researcher.
• Measurement Error: It may be defined as the variation between the information
sought and the information generated by the measurement process employed by the
researcher.
• Population Definition Error: It may be defined as the variation between the actual
population relevant to the problem at hand and the population as defined by the
researcher.
• There are still more types of errors:
- Sampling Frame Error
- Data Analysis Error
- Respondent Selection Error
- Questioning Error
- Recording Error
- Cheating Error
- Inability Error
- Unwillingness Error

Budgeting and Scheduling the Project: These are the management tools needed to help
ensure that the marketing research project is completed within the available resources. A
useful approach for managing a project is the critical path method (CPM). It is a
management technique of dividing a research project into component activities,
determining the sequence of these components and the time each activity will require.
An advanced version of CPM is the program evaluation and review technique
(PERT), which accounts for the uncertainty in project completion times. An even more
advanced scheduling technique is the graphical evaluation and review technique
(GERT) in which both the completion probabilities and the activity costs can be built
into a network representative.

Marketing Research Proposal: It is the official layout of the planned marketing research
activity for management. It describes the research problem, the approach, and the
research design, data collection methods and reporting method. Normally, it contains the
following elements:
1. Executive Summary: summary of the major points from each of the other sections,
presenting an overview of the entire proposal.

2. Background: includes discussion of the environmental context.

3. Problem Definition / Objective of the Research: Normally, a statement of the

problem, including the specific components, should be presented. If this statement
has net been developed (as in the case of problem identification research), the
objectives of the marketing research project should be clearly specified.

4. Approach to the Problem: a review of the relevant academic and trade literature
should be presented. Research questions and hypotheses should be included, if they
are identified.

5. Research Design: information should be given on the type of research design that
should be adopted. Other information that should be adopted include: (i) kind of
information to be obtained, (ii) method of administering the questionnaire, (iii)
Scaling techniques, (iv) nature of the questionnaire (type of questions asked, length,
average interviewing time0, and (v) sampling plan and sample size.

6. Field Work / Data Collection: the proposal should discuss how the data will be
collected and who will collect it. Control mechanisms to ensure the quality of data
collected should be described.

7. Data Analysis: the kind of data analysis that will be conducted and how the results
will be interpreted should be described.

8. Reporting: the proposal should specify whether intermediate reports will be

presented and at what stages, what will be the form of the final report, and whether
a formal presentation of the results will be made.

9. Cost and Time: the cost of the project and a time schedule, broken down by phases,
should be presented. A CPM or PERT chart might be included.

10. Appendices: any statistical or other information that is of interest only to a few
people should be contained in appendices.

Ethics in Marketing Research: rights of the respondents must be respected. While

adopting the type of research design, certain ethical issues are involved: a research firm
that has not conducted many longitudinal studies may try to justify the use of cross-
sectional design. The researcher must ensure that the research design utilized will provide
the information needed to address the marketing research problem that has been
identified. The client should have the integrity not to misrepresent the project and should
describe the constraints under which the researcher must operate and not make
unreasonable demands. If time is an issue, or if customer contact has to be restricted, the
client should make these constraints known at the start of the project. Finally, the client
should not take undue advantage of the research firm to solicit unfair concessions for the
current project by making false promises of future research contracts.

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Exploratory Research Design: Secondary Data

Primary Data:

Data obtained by the researcher for the specific purpose of addressing the research
problem.

Secondary Data:

Data collected for some purpose other than the problem at hand.

A Comparison of Primary and Secondary Data:

Primary Data Secondary Data

Collection purpose For the problem at hand For other problems

Collection process Very involved Rapid and easy
Collection cost Relatively high Relatively low
Collection time Relatively long Relatively short

Advantages and Uses of Secondary Data: Rich dividends obtained by the general rule
regarding secondary data – “examination of available secondary data is a prerequisite to
the collection of primary data. Start with secondary data. Proceed to primary data only
when the secondary data sources have been exhausted or yield marginal returns.
Secondary data can help the researcher:

• Identify the problem.

• Better define the problem.
 • Develop an approach to the problem.

• Formulate an appropriate research design (e.g. for identifying key variables)

• Answer certain research questions and test some hypotheses.
• Interpret primary data more insightfully.

Disadvantages of Secondary Data: Because secondary data have been collected for
purpose other than the problem at hand, there are certain disadvantages associated:

• Usefulness is limited.
• Limited relevance

• Lack accuracy
• Need to be evaluated before use

Criteria for Evaluating Secondary Data

Criteria Issues Remarks

Specifications/ Data collection method Data should be reliable, valid, and

Methodology Response rate applicable to the problem at hand
Quality of data
Sampling technique
Sample size
Questionnaire design
Fieldwork
Data analysis
Error/ Examine errors in: approach, Assess accuracy by comparing
Accuracy research design, sampling, data data from different sources.
collection, data analysis, reporting
Currency Time lag between collection and Census data are periodically
publication. Frequency of updates updated by syndicated firms.
Objective Why were the data collected? The objective will determine the
relevance of the data.
Nature Definition of key variables Reconfigure the data to increase
Unit of measurement their usefulness, if possible.
Categories used
Relationships examined
Dependability Expertise, credibility, reputation, Data should be obtained from an
and trustworthiness of the source original rather than an acquired
source.

Classification of Secondary Data: Secondary data can be classified as internal data are
those available within the organization for which the research is being conducted and
external data that originate from external sources to the organization. Internal data can be
further classified into - ready to use data and data that requires further processing.
External data can have further classification based on the source viz. published data,
computerized data or syndicated data. Published external sources may be broadly
classified as general business sources are comprised of guides, directories, indexes, and
statistical data. Government sources may be broadly categorized as census data, and other
publications.

Computerized Databases: Databases (bibliographic, numeric, full-text, directory, and

special purpose), stored in computers, which require a telecommunications network to
access

Internet Databases: Internet databases can be accessed, searched, and analyzed on the
internet. It is also possible to download data from the internet and store it in the computer
or an auxiliary storage device.

Offline Databases: Databases those are available on diskette or CD-ROM

Syndicated Sources of Secondary Data: Information services offered by marketing

research organizations that provide information from a common database to different
firms that subscribe to their services.

Overview of Syndicated Services: Surveys: conducted at regular intervals, advantages:

most flexible way of obtaining data; information on underlying motives. Disadvantages:
interviewer errors; respondent errors. Uses: market segmentation, advertising theme
selection, and advertising effectiveness.

Purchase Panels: households provide specific information regularly over an extended

period of time; respondents asked to record specific behaviours as they occur.
Advantages: recorded purchase behaviour can be linked to the
demographic/psychographic characteristics. Disadvantages: lack of representatives;
response bias; maturation. Uses: forecasting sales, market share, and trends; establishing
consumer profiles, brand loyalty, and switching; evaluating test markets, advertising, and
distribution.

Media Panels: electronic devices automatically recording behaviour, supplemented by a

diary. Advantages: same as purchase panels. Disadvantages: same as purchase panels.
Uses: establishing advertising rates; selecting media program or air time; establishing
viewer profiles.

Scanner Volume Tracking Data: household purchases recorded through electronic

scanners in supermarkets. Advantages: data reflect actual purchases; timely data; less
expensive. Disadvantages: data may not be representative; errors in recording purchases;
difficult to link purchases to elements of marketing mix other than price. Uses: price
tracking, effectiveness of in-store modeling.

Scanner Panels with Cable TV: scanner panels of households that subscribe to cable TV.
Advantages: data reflect actual purchases; sample control; ability to link panel data to
household characteristics. Disadvantages: data may not be representative; quality of data
limited. Uses: promotional mix analyses, copy testing, new-product testing, positioning.

Audit Services: verification of product movement by examining physical records or

performing inventory analysis. Advantages: relatively precise information at the retail
and wholesale levels. Disadvantages: coverage may be incomplete; matching of data on
competitive activity may be difficult. Uses: measurement of consumer sales and market
share, competitive activity, analyzing distribution patterns: tracking of new products.

Industrial Product Syndicated Services: data banks on industrial establishments created

through direct inquiries of companies, clipping services, and corporate reports.
Advantages: important source of information in industrial firms, particularly useful in
initial phases of the projects. Disadvantages: data are lacking in terms of content,
quantity, and quality. Uses: determining market potential by geographic area, defining
sales territories, allocating advertising budget.

Syndicated Data from Households:

Surveys: interviews with a large number of respondents using a pre-designed

questionnaire

Psychographics: quantified psychological profiles of individuals

Lifestyles: distinctive pattern of living that is described by the activities people engage in

Purchase panels: data-gathering technique in which respondents record their purchases

online or in a diary

Media Panels: data-gathering technique that is comprised of samples of respondents

whose television viewing behaviour is automatically recorded by electronic devices,
supplementing the purchase information recorded online or in a diary

Scanner Data: data obtained by passing merchandise over a laser scanner that reads the
universal product code (UPC) from the packages

Volume Tracking Data: data collected from check-out scanner tapes that provide
information on purchases by brand, size, price, and flavour

Scanner Panels: scanner data where panel members are identified by an ID card allowing
each panel member’s purchases to be stored with respect to the individual shopper

Scanner Panels with Cable TV: the combination of a scanner panel with manipulations of
the advertising that is being broadcast by cable television companies

Syndicated Data from Institutions:

Retailer and Wholesaler Audits: a data collection process derived from physical records
or by performing inventory analysis.

Industry Services: provide syndicated data about industrial firms, businesses, and other
institutions

Combining Information from Different Sources:

Single-source Data: An effort to combine data from different sources by gathering

integrated information on household and marketing variables applicable to the same set
of respondents.
Computer Mapping: maps that solve marketing problems are called thematic maps. They
combine geography with demographic information and a company’s sales data or other
proprietary information and are generated by a computer.
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Exploratory Research Design: Qualitative Research

Like secondary data analysis, qualitative research is a major methodology used in

exploratory research. Researchers undertake qualitative research to define the problem or
develop an approach by generating hypotheses and identifying variables.

Qualitative Versus Quantitative Research:

Qualitative Research Quantitative Research

Objective To gain a qualitative To quantify the data and generalize
understanding of the underlying the results from the sample to the
reasons and motivations population of interest
Sample Small number of non- Large number of representative
representative cases cases
Data collection Unstructured Structured
Data analysis Non-statistical Statistical
Outcome Develop an initial understanding Recommend a final course of action

Rationale for using Qualitative Research:

There are several reasons to use qualitative research. It is not always possible or desirable
to use fully structured or formal methods to obtain information from respondents. People
may be unwilling or unable to answer certain questions. People are unwilling to give
truthful answers to questions that invade their privacy, embarrass them, or have a
negative impact on their ego or status.

A Classification of Qualitative Research Procedures:

Direct Approach: purposes of the project are disclosed to the respondents or are obvious,
given the nature of the interview
Indirect Approach: the purposes of the project are disguised from the respondents.

Focused Group: an interview conducted by a trained moderator among a small group of

respondents in an unstructured and natural manner

Characteristics of Focus Groups

Group size 8 to 12
Group composition Homogeneous: respondents prescreened
Physical setting Relaxed, informal atmosphere
Time duration 1 to 3 hours
Recording Use of audiocassettes and videotapes
Moderator Observational, interpersonal, & communication skills of the
moderator
Procedure for Planning and Conducting Focus Groups:

• Determine the objectives of the marketing research project and define the
problem.
• Specify the objectives of qualitative research.
• State the objectives / questions to be answered by focus groups.
• Write a screening questionnaire.
• Develop a moderator’s outline.
• Conduct the focus group interviews.
• Review tapes and analyze the data.
• Summarize the findings and plan follow-up research or action.

Variations in Focus Groups:

Two-way Focus Group: This allows one target group to listen to and learn from a related
group. In one application, physicians viewed a focus group of arthritis patients discussing
the treatment they desired. A focus group of these physicians was then held to determine
their reactions.

Dual-moderator group: This is a focus group interview conducted by two moderators.

One moderator is responsible for the smooth flow of the session, and the other ensures
that specific issues are discussed.

Dueling-moderator Group: Here also there are two moderators, but they deliberately take
opposite positions on the issues to be discussed. This allows the researcher to explore
both sides of controversial issues.

Respondent-moderator Group: In this type of focus group, the moderator asks selected
participants to play the role of moderator temporarily to improve group dynamics.
Client-participant Group: Client personnel are identified and made part of the discussion
group. Their primary role is to offer clarifications that will make the group process more
effective.

Mini Groups: These groups consist of a moderator and only 4 to 5 respondents. They are
used when the issues of interest require more extensive probing than is possible in the
standard group of 8 to 12.

Telesession Groups: Focus group sessions by phone using the conference call technique.

Advantages of Focus Groups:

• Synergism: produce wider range of information

• Snowballing: one person’s comment triggers a chain reaction
• Stimulation: level of excitement over the topic increases
• Security: participants feel secure and express their ideas and feelings
• Spontaneity: responses are spontaneous and unconventional
• Serendipity: ideas more likely to arise out of the blue
• Specialization: large number of participants justifies use of highly trained, but
expensive interviewer
• Scientific scrutiny: the group interview allows close scrutiny of the data collection
process
• Structure: allows for flexibility in the topics covered and depth with which they
are treated
• Speed: number of individuals are being interviewed at the same time, data
collection and analysis proceed relatively quickly

Disadvantages of Focus Groups:

• Misuse: focus groups can be misused or abused by considering the results as

conclusive rather than exploratory

• Misjudge: results can be more easily misjudged than the results of other data-
collection techniques

• Moderation: difficult to moderate. Moderators with all the desired skills are rare.

• Messy: the unstructured nature of responses makes coding, analysis, and

interpretation difficult.

• Misrepresentation: results are not representative of the population and are not
projectable.
Applications of Focus Groups: Focus groups can be used to address substantive issues
such as:

1. Understanding consumers’ perceptions, preferences, and behaviour concerning a

product category
2. Obtaining impressions of new product concepts
3. Generating new ideas about older products
4. Developing creative concepts and copy material for advertisements
5. Securing price impressions
6. Obtaining preliminary consumer reaction to specific marketing programs

The methodological applications include:

1. Defining a problem more precisely

2. Generating alternative courses of action
3. Developing an approach to a problem
4. Obtaining information helpful in structuring consumer questionnaire
5. Generating hypotheses that can be tested quantitatively
6. Interpreting previously obtained quantitative results

Online Versus Traditional Focus Groups

Characteristics Online Focus Group Traditional Focus Group

Group size 4-6 8 – 12
Group composition Anywhere in the world Drawn from the local area
Time duration 1 – 1.5 hours 1 – 3 hours
Physical setting Researcher has little control Under control of the researcher
Respondent identity
Difficult to verify Can be easily verified
Respondent Respondents can engage in Attentiveness can be monitored
attractiveness other tasks
Respondent Easier; can be recruited online, Recruited by traditional means
recruiting by e-mail, panel, or by (telephone, mail, mail panel)
traditional means
Group dynamics Limited Synergistic, snowballing effect
Openness of Respondents are more candid Respondents are candid, except
respondents due to lack of face-to-face for sensitive topics
contact
Nonverbal Body language cannot be Body language and emotions
communication observed; emotions expressed observed
by using symbols
Use of physical Limited to those that can be A variety of stimuli (products,
stimuli displayed on the internet advertising, demonstrations,
etc.) can be used.
Transcripts Available immediately Time consuming and expensive
to obtain
Observers’ Observers can communicate Observers can manually send
communication with with the moderator on a split notes to the focus group room.
moderator screen.
Unique moderator Typing, computer usage, Observational
skills familiarity with chat room
slang.
Turnaround time Can be set up and completed in Takes many days for setup and
a few days completion
Client travel costs None Can be expensive
Basic focus group Much less expensive More expensive due to facility
costs rental, food, video/audio taping,
and transcript preparation

Depth Interviews: An unstructured, direct, personal interview in which a single

respondent is p-robed by a highly skilled interviewer to uncover underlying motivations,
beliefs, attitudes, and feelings on a topic.

Depth Interview Techniques: Three techniques are popular – laddering, hidden issue
questioning, and symbolic analysis.

Laddering: A technique for conducting depth interviews in which a line of questioning

proceeds from product characteristics to user characteristics

Hidden Issue Questioning: A type of depth interview that attempts to locate personal sore
spots related to deeply felt personal concerns.

Symbolic Analysis: A technique for conducting depth interviews in which the symbolic
meaning of objects is analyzed by comparing them with their opposites.

Advantages of Depth Interviews:

• Can uncover greater depth of insights than focus group
• Attribute the responses directly to the respondent
• Result in free exchange of information

Disadvantages of Depth Interviews:

• Skilled interviewers capable of conducting interviews are expensive and difficult
to find
• Lack of structure makes the results susceptible to the interviewer’s influence
• Quality and completeness heavily depend upon interviewer’s skills
• Data obtained are difficult to analyze and interpret and requires services of skilled
psychologists
• The length of the interview combined with high costs means that the number of
depth interviews in a project will be small.

Applications of Depth Interviews: As with focus groups, the primary use of depth
interviews is for exploratory research to gain insights and understanding. However,
unlike focus groups, depth interviews are used infrequently in marketing research.
Nevertheless, depth interviews can be effectively employed in special situations, such as
follows:
• Detailed probing of the respondents
• Discussion of confidential, sensitive, or embarrassing topics
• Situations where strong social norms exist and the respondent may be easily
swayed by group response
• Detailed understanding of complicated behaviour
• Interviews with professional people
• Interviews with competitors, who are unlikely to reveal the information in a group
setting
• Situations where the product consumption experience is sensory in nature,
affecting mood states and emotions

Projective Techniques: An unstructured and indirect form of questioning encourages the

respondents to project their underlying motivations, beliefs, attitudes, or feelings
regarding the issues of concern. These techniques are classified as association,
completion, construction, and expressive.

Association Techniques: A type of projective technique in which the respondent is

presented with a stimulus and asked to respond with the first thing that comes to mind. A
projective technique in which respondents are presented with a list of words, one at a
time is called word association. After each word, they are asked to give the first word
that comes to mind.
Completion Techniques: A projective technique that requires the respondent to complete
an incomplete stimulus situation. Common completion techniques in marketing research
are sentence completion and story completion.
Construction Techniques: A projective technique in which the respondent is required to
construct a response in the form of a story, dialogue, or description. The two main
construction techniques are picture response and cartoons.
Expressive Techniques: Projective techniques in which the respondent is presented with a
verbal or visual situation and asked to relate the feelings and attitudes of other people to
the situation. The two main expressive techniques are role playing and third-person
technique.

Advantages of Projective Techniques:

• They may elicit responses that subjects would be unwilling or unable to give if
they knew the purpose of study.
• Validity of responses is greater when purpose of projective technique is disguised.
This is particularly true when the issues to be addressed are personal, sensitive, or
subject to strong social norms.
• Helpful when underlying motivations, beliefs, and attitudes are operating at a
subconscious level.

Disadvantages of Projective Techniques:

• Require highly trained interviewers for personal interviews.
 • Skilled interpreters are also required to analyze the responses. Hence they tend to
be expensive.
• There is serious risk of interpretation bias.
• With the exception of word association, all techniques are open ended, making the
analysis and interpretation difficult and subjective.
• Some techniques like role playing require respondents to engage in unusual
behaviour. in such cases, the researcher may assume that respondents who agree to
participate are themselves unusual in some way. Therefore, they may not be
representative of the population interest.

Application of Projective Techniques: Projective techniques can be used in a variety of

situations. The usefulness of these techniques is enhanced when the following guidelines
are observed:
• Projective techniques should be used because the required information cannot be
accurately obtained by direct methods.
• Projective techniques should be used for exploratory research to gain initial
insights and understanding.
• Given their complexity, projective techniques should not be used naively.

A Comparison of Focus Groups, Depth Interviews, and Projective Techniques:

Criteria Focus Groups Depth Interviews Projective Techniques

Degree of structure Relatively high Relatively medium Relatively low

Probing of individual Low High Medium
respondents
Moderator bias Relatively medium Relatively high Relatively high
Interpretation bias Relatively low Relatively medium Relatively high
Uncovering Low Medium to high High
subconscious
information
Discovering High Medium Low
innovative information
Obtaining sensitive Low Medium High
information
Involve unusual No To a limited extent Yes
behaviour/ questioning
Overall usefulness Highly useful Useful Somewhat useful

Analysis of Qualitative Data: Compared to quantitative research, where numbers and

what they stand for are the units of analysis, qualitative data analysis uses words as the
units of analysis and is guided by fewer universal rules and standard procedures. The goal
in qualitative research is to decipher, examine, and interpret meaningful patterns or
themes that emerge out of the data. The meaningfulness of patterns and themes is
determined by the research question at hand. There are three general steps that should be
followed when analyzing qualitative data:

Data Reduction: In this step, the researcher chooses which aspects of the data are
emphasized, minimized, or set aside for the project at hand.
Data Display: In this step, the researcher develops a visual interpretation of the data with
the use of such tools as a diagram, chart, or matrix. The display helps to illuminate
patterns and interrelationships in the data.
Conclusion Drawing and Verification: In this step, the researcher considers the meaning
of analyzed data and assesses its implications for the research question at hand.

Software Packages: Software packages are available that can be used to assist the
analysis of qualitative data. There are six main types: word processors, word retrievers,
text-base managers, code-and-retrieve programs, code-based theory builders, and
conceptual network builders. It is important to remember that although these packages
may help in the manipulation of relevant text segments, they cannot determine
meaningful categories for coding or define important themes and factors; these steps are
the responsibility of the researcher. The specific things that various programs can do are:
coding, memoing / annotation, data linking, search and retrieval, conceptual / theory
development, data display, graphics editing etc.
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