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RESEARCH
METHODOLOGY OF MR
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MARKETING RESEARCH
WHAT IS MARKETING?
For this process, marketing dept. Needs continuous information about environment consisting
of customers, competition and forces at market place.
Marketing research provides this information. Hence marketing research can be defined as:
Today’s manager needs to know more than any manager in the past because of:
Globalization of organizations.
Complexity of business and high cost of wrong decision.
Customer is becoming affluent, sophisticated & knowledgeable.
Availability of computers.
RESEARCH PROCESS:
Many a time’s management sees the symptoms & not the problem.
For e.g. management problems would be:
Declining sales
Increasing employee turnover
Large no. of product complaints
These are symptoms. The researcher’s role is to help management to identify the problem and
give solutions.
Following methods are used to convert management decision problem into research problem:
• Discussion with decision makers
• Interviews of industry experts
• Secondary data analysis
• Qualitative research
Research problem should be broken down into more specific questions for which data is to be
obtained. Such fractionization helps in:
1. Designing questionnaire
2. Selecting method of administering questionnaire
3. Calculating sample size
4. Selecting sampling method
5. Selecting data analysis techniques
Example 1:
Management problem : A magazine publishing company was keen to know what changes
could be incorporated to improve its appeal to readers.
Broad research problem: To gather0 information about magazine subscribers
Specific components:
1. Demographics of subscribers
2. Psychological characteristics of subscribers like travel, credit card use, consumer
electronics, investments, property etc.
3. Readership of magazine covering time spent to read the magazine, articles read etc.
Example 2:
Management problem : How to increase sales of dept store ‘A’?
Broad research problem : To find out relative strength and weakness of department store
‘A ‘vis-à-vis store ‘B’.
Specific components:
1. What criteria do households use while selecting a department store?
2. How do households evaluate stores ‘A’ and ‘B’ in terms of criteria identified in 1 above?
3. Are specific stored preferred while shopping specific product categories?
4. % market share of each store
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5. What is the demographic and psychological profile of customers of store ‘A’? Does it
differ from profile of customers of ‘B’?
While determining research problem often two types of errors occur. They are:
1. Defined problem is too broad which does not provide clear guideline
2. Defined problem is too narrow
Exploratory designs are useful when researcher lacks clear idea in carrying out the
research whereas conclusive research is conducted for arriving at the final conclusion.
Conclusive research begins where exploratory research ends.
RESEARCH DESIGNS
EXPLORATORY CONCLUSIVE
Exploratory research designs are useful when researcher does not have enough
understanding to proceed with research project.
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I. EXPLORATORY RESEARCH:
It is conducted to:
1. Formulate a problem more precisely
2. Develop hypothesis
3. Identify key variables & relationships for further examination
4. Gain insights for developing approach to the problem.
SECONDARY DATA:
Data
Primary Secondary
The researcher originates primary data whereas secondary data is collected for purpose other
than the researcher’s problem. Classification of secondary data:
1. Internal secondary data
2. External secondary data
Internal data: internal secondary data is the data generated in the organization. It is readily
available with less cost e.g. Sales by region, outlets, cash/credit and products etc.
External data: external data consists of following sources:
1. General business data: Published through directories, guides, indexes, journals, and
periodicals etc.
2. Govt. Sources: Like census data, RBI bulletin and economic surveys etc.
3. Syndicated sources: This data is collected by an organization & shared by no. of clients.
Such data is collected through:
• ‘Household surveys’ which involve interviews with large no. Of respondents using
pre-designed questionnaire.
• ‘Diary panels’ which involve collecting information from sample of respondents who
provide specified information at regular intervals over a period of time.
• ‘Wholesalers & retailers’ who record their purchases, sale & inventory every month.
Such data is called ‘audit data’.
Advantages Disadvantages
o most flexible way of obtaining data o Response bias
from respondents o Errors in questionnaire design,
communication, recording of data
Diary panels:
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Advantages Disadvantages
o provide more & higher quality data o Low representation of sample
than surveys
Audits:
Advantages Disadvantages
o provides relatively accurate o All markets not covered
information on movement of large no.
of products at wholesale / retail outlet.
QUALITATIVE RESEARCH:
I. Direct approach:
1. Focus group:
It is an overview of small group of people conducted by a trained moderator in
unstructured way.
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The value of the technique lies in the unexpected findings often obtained from a
free-flowing group discussion, spontaneous responses and interaction among
members.
Characteristics of focus groups:
Group size : 8 - 12
Group composition : homogeneous, respondents pre-
screened
Physical setting : relaxed, informal atmosphere.
Time duration : 1 - 3 hours
Recording : use of audiocassettes, videotapes.
Moderator : trained & skilled.
Group size less than 8 fails to generate momentum in discussion & more than 12 is a
crowd.
Respondents are pre-screened to ensure that they have adequate experience with the
object or issues being discussed.
We should have more than one focus group since outcome of one group may
not be representative.
Advantages Disadvantages
• Produce wider range of information, insights, • Can be misused by
ideas than individual responses obtained considering the results as
privately (synergy) conclusive than
exploratory (misuse)
• One person’s comment triggers a chain reaction
from other participants (snowballing) • Difficult to moderate
(moderation)
• Since participants are not required to answer
specific questions, their responses can be • Results are more
spontaneous & unconventional and should susceptible to misjudge
therefore give accurate idea of their views (misjudge)
(spontaneity)
• Unstructured nature of
• Data collection is quick since number of responses make coding,
individuals are interviewed at a time (speed) analysis & interpretation of
data difficult (messy)
• Since participant’s feelings are similar to those of
other participants he feels comfortable in
expressing his ideas & feelings (security)
Compared to individual interviews that aim to obtain individual attitudes, focus group obtains
multiplicity of views & interaction between group members.
Findings of focus groups are not conclusive since sample of participants is small, hence, it
does not represent population.
Compared to individual interviews which aim to obtain individual attitudes, focus group obtains
multiplicity of views & group interaction
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E.g. Before Plymouth breeze car was introduced in ’96, extensive focus group discussions
were conducted. The discussions revealed that the purchasing criteria for automobile change
with different stages in life. This finding has helped in formulating following hypotheses:
• As people’s lifestyle & needs change, so does their preference for car.
• As people make more money, they are willing to pay higher price for car.
• People have negative perception of the sales pressure involved in car buying process.
2. Depth interviews:
In depth interview, interviewer’s role is superior. He has to establish rapport with the
respondent. He should:
• Avoid appearing superior
• Put respondent at ease
• Be objective
• Ask questions in an informative manner
• Not accept brief ‘yes’, ‘no’ answers.
Advantages Disadvantages
• Can uncover greater depth than focus • Need of skilled interviewer
group
• Lack of structure makes results
• Responses can be attributed to susceptible to interviewer’s influence
specific respondent unlike focus group
• Free exchange of information that may • Obtained data is difficult to analyze &
not be possible in focus group interpret. Services of psychologist are
needed.
In this technique, respondents are asked to interpret the behaviour of others. In interpreting the
behaviour of others, respondents indirectly project their own feelings. In clinical psychology it is
established that more the ambiguous situation, respondents project their true emotions.
1. Association technique:
In ‘Association Technique’ the respondent is presented with a
stimulus & asked to respond with the first thing that comes to his mind. ‘word association’ is
the best known of these techniques. In ‘word association’ technique respondent is
presented with a list of words, one at a time, & asked to respond to each with the first thing
that comes in his mind. The words of interest, called test words, are interspersed
throughout the list, which also contains to disguise the purpose of study. The underlying
assumption is that association allows the respondents to reveal their inner feelings
associated with each word. Responses are analyzed by calculating:
2. Completion technique:
The respondent is asked to complete an incomplete stimulus
situation. Common completion techniques are ‘sentence completion’ & ‘story completion’
3. Construction technique:
In this technique, the respondent is asked to construct a story,
dialogue or description for a stimulus shown to him. Main construction technique is
picture/cartoon response. A picture/cartoon is shown to the respondent & he is asked to
build up a story based on the picture/cartoon.
4. Expressive technique:
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a) Role playing: in role playing, respondents are asked to play the roles or
assume the behaviour of someone else. The assumption is that the
respondent will project his own behaviour through the role.
1. Cross-sectional designs: This design involves collection of information from any given
sample or population only once. In ‘single’ cross-sectional design, information is
obtained only once from one sample whereas in ‘multiple’ cross-sectional design
information is obtained only once from more than one sample.
2. Longitudinal designs: In this design data is collected from same sample(s) repeatedly
over a time period. Such sample is also called ‘panel’.
Relative advantages & disadvantages of cross-sectional and longitudinal designs are shown
below:
Cross-sectional Longitudinal
Detecting change - +
Large volume of data collection - +
Accuracy - +
Representative sample + -
Survey method and observation methods are two descriptive research designs methods.
1. Survey method:
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Survey methods
Telephone interview:
Advantages:
Respondents can be contacted faster.
Economical.
Disadvantages:
Persons with telephone connection can only be contacted.
Cannot show sample products, pictures, visual aids etc.
Personal interview:
Advantages:
Respondent develops highest trust in interviewer.
Can show sample products, pictures, visual aids etc.
Longer interviews are possible.
Disadvantage:
Expensive.
Mail interview:
Advantages:
People give more honest answers when answering on computer followed by mail
survey.
Economical.
Can show sample products, pictures, visual aids etc.
Useful for sensitive issues.
Respondent can answer at his leisure time.
Disadvantages:
Takes longer time to get responses.
Follow-up is required.
Lower response rate that may lead to biased sample.
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Electronic interview:
Advantages:
Respondent gives most honest answers.
Speed.
Online updating of database.
Can attach picture and sound files.
Disadvantages:
Respondent must have access to computer.
No control over responses that may lead to biased sample.
Few respondents can respond several times.
2. Observation method:
Observation methods can be classified by mode of administration & they are as follows:
observation methods
Personal mechanical
Observation observation
In mechanical observation, mechanical devices, rather than human observers, record the
observation. Various mechanical devices are as follows:
Use of mechanical devices assumes that physiological reactions are associated with specific
cognitive responses.
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The most serious disadvantages of observation method is that little is known about the
underlying motives, beliefs of a particular behaviour. E.g. Customer may be purchasing a
brand for his neighbour. Other disadvantages are these methods are expensive, difficulty in
observing & interpreting some form of behaviour.
While survey & observation methods provide valuable information, it does not allow the
researcher to do experiments that will lead to find cause-effect relationship.
E.g. Researcher is interested to find out whether there is a relationship between discount given
& sales generated. For this purpose he would offer discount coupons of varying % and record
sales. Such data will help him to find out if any relationship exists between discount offered
and sales generated. Here he has experimented with ‘discount’ variable to find cause-effect
relationship.
Marketing effects (sales in above example) are caused by multiple variables (one of them is
discount in above example). Hence cause-effect relationship tends to be probabilistic and not
deterministic.
Before making causal inference, three conditions must be satisfied & they are:
‘Concomitant variation’ is the extent to which cause, x, & effect, y, varies together. Such
variation can be assessed by qualitative or quantitative data.
For e.g., in qualitative case, suppose it is observed that the sale of a restaurant offering more
variety in food is high compared to the one offering less variety. Hence there is a concomitant
variation in sale (effect ‘y’) and variety of food (cause ‘x’). Such situation makes hypothesis of
‘more variety more sale’ tenable, but it does not prove it. This is because there could be a
factor, other than variety in food that has an impact on sales.
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In quantitative case, suppose we have the following data of 1000 respondents on purchase of
fashion garments and education of purchaser:
Purchase of fashion
Education garments
High Low
High 363 (73%) 137 (27%)
Low 322 (64%) 178 (36%)
Above data shows that effect ‘purchase of fashion garments’ and cause ‘education’ move in
the same direction. It leads to a tenable hypothesis that ‘as education level goes high so the
purchase of fashion garments’. However, it does not prove the hypothesis since income of
purchaser could also be a factor affecting the sale.
‘Time order of occurrence of events’ means cause should occur before or at least with
the effect. It cannot occur after the effect.
‘Elimination of effects of other causal factors’ means the effects of other causal factors
not being studied should be either eliminated or controlled. For e.g. while understanding
cause-effect relationship between education and purchase of fashion clothing, effect of income
on purchase of fashion clothing should be eliminated or controlled.
Independent variables (treatments): These are the variables that are manipulated (i.e. Levels
of such variables are changed by the researcher to test causal relationship). In above
examples they are ‘variety of menu’ and ‘education’
Control group: It is the group in which independent variables are not manipulated.
Test units: These are individuals, organizations or other entities whose response to the
independent variables is examined. In above example test units are ‘individuals’.
Dependent variables: these are the variables that measure the effect of independent variables
on test units. In above examples they are ‘sale’ of restaurant and of fashion garments.
Extraneous variables (confounding variables): these are variables other than independent
variables that affect the response of test units. Since such variables confound (confuse) the
researcher, they are also called ‘confounding variables’. In above example such variable is
‘income’.
There are four ways in which the effect of extraneous variables can be controlled. They are:
• Randomization
• Matching
• Statistical control
• Design control
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‘Randomization’ means test units are assigned to treatments on a random basis by using
random numbers so that we can reasonably assume that extraneous causal factors affecting
dependent variable will be represented equally in each treatment condition.
‘Matching’ means the test units are matched on key variables and matched units are assigned
to different treatments. The goal is to make sure that there are no significant differences
between characteristics of respondents assigned to various treatments.
‘Statistical control’ means measuring the effect of extraneous variables and adjusting for their
effects through statistical analysis. The statistical techniques used are analysis of variance
(ANOVA) or analysis of covariance (ANCOVA).
‘Design control’ means using specialized statistical designs, which control effects of specific
extraneous variables.
Validity in experiments:
• Draw valid conclusions about effect of independent variables on test units (internal
validity)
• Make valid generalizations to population (external validity)
‘Internal validity’ refers to whether observed effect on test units could have been caused by
variables other than treatment i.e. by extraneous variables. Controlling the effect of extraneous
variables can increase internal validity.
‘External validity’ refers to whether cause-effect relationship found in the experiment can be
extended to population?
It is desirable to have both internal & external validity to an experiment. However, if internal
validity is increased, external validity declines. For e.g. Controlling effects of extraneous
variables can increase internal validity. But external validity would decline because effect of
extraneous variables cannot be controlled fully in population.
Hence any experiment should balance both validities.
Field experiments are less common in marketing research because they are time consuming,
expensive and difficult to administer.
For analysis of any data, whether quantitative or qualitative, it has to be converted into
numbers. Hence we will first study primary scales of measurement and then find out how they
can be used for capturing different types of data.
• Nominal scale
• Ordinal scale
• Interval scale
• Ratio scale
In ‘Nominal scale’ numbers are assigned to identify objects uniquely. For e.g. Vehicle nos.,
account nos., credit card nos., roll nos. The only permissible operation on such numbers is
counting. %, mode, chi-square and binomial tests can be performed on such data.
In ‘Ordinal scale’ numbers are assigned to objects to indicate the extent to which the objects
possess some characteristics. This scale allows to determine whether an object has more or
less of a characteristic than some other object, but not how much less or more. This means we
cannot conclude about difference between values of two objects. We can calculate median,
quartiles, deciles, percentiles & rank order correlation.
In ‘Interval scale’ we can conclude about differences of values of two objects but not about the
ratios. This means interval scale contains all the information of ordinal scale and allows us to
compare difference of values of two objects but not ratios.
For e.g.
1 26
2 32
3 38
4 44
Difference difference
in x in y
2-1 = 1 32-26 = 6
3-2 = 1 38-32 = 6
4-3 = 1 44-38 = 6
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Ratio in x ratio in y
From above it can be seen that difference of 1 in x is equivalent to difference of 6 in y. But this
is not true for ratio of 2 in x. In first case, ratio of y is 1.230 and in second case it is 1.375.
Hence difference is valid but not ratios.
Such relation will exist between y and x if y = a + bx where a is not equal to zero.
Values of c values of f
10 50
20 68
30 86
40 104
Difference difference
In c in f
20-10 = 10 68-50 = 18
30-20 = 10 86-68 = 18
40-30 = 10 104-86 = 18
Ratio in c ratio in f
Above example shows that difference is valid whether temperature is measured in f or c, but
not ratio.
The equation in f & c can be obtained by putting a = 32 and b = 9/5 in
generalized equation given above viz. Y = a + bx
In example (1) above, y = 6x. We will now calculate values of y for same values of x
Values of x y = 6x
1 6
2 12
3 18
4 24
Difference difference
in x in y
2-1 = 1 12- 6 = 6
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3-2 = 1 18-12 = 6
4-3 = 1 24-18 = 6
Ratio in x ratio in y
2/1 = 2 12/ 6 = 2
4/2 = 2 24/12 = 2
Now the relation between x and y exists for difference as well as ratios. Such data is said to be
in ratio scale.
In general if y = bx where b is positive then such scale is said to be ratio scale. E.g. are
consumption of product, income, and distance etc.
We can perform four basic mathematical operations of +, -, * and / on ratio scale data.
SCALING TECHNIQUES:
In ‘Comparative Scale’ (also called as non-metric scale), direct comparison of objects is done.
For e.g. Respondents are asked to compare ‘LG’ TV with ‘Samsung’ TV and tell which brand
he would prefer. Comparative scale data is always in ordinal scale. The benefits of
comparative scaling are:
Comparison is between the selected objects only. If new object is introduced, fresh
exercise needs to be done.
No. Of pairs become too high if no. Of objects to be compared is high.
In ‘Non Comparative Scale’ (also called as monadic or metric scale), each object is scaled
separately. For e.g. LG and Samsung TVs may be evaluated on 7 point preference scale,
where 1 = not preferred at all and 7 = preferred very much. Non-comparative scales are widely
used in marketing research.
Scaling techniques
Rating Rating
1. Paired comparison:
A respondent is presented two objects & he is asked to select one according to some criterion.
If there are ‘n’ objects to be compared there will be {n(n-1)/2} pairs.
The column total shows the number of times the brand is preferred.
This technique is useful when no. Of objects is limited. Its advantage is that it brings out even
the smallest difference between two brands.
2. Rank order:
Respondents are presented all the objects simultaneously and asked to rank them according
to some criterion.
When no. Of brands to be compared is high, rank order is preferred to paired comparison.
3. Constant sum:
In constant sum scaling, score is given to each object on the basis of some criterion. The sum
of scores is constant.
The main advantage of this scale is that it allows for fine discrimination among objects without
spending too much time.
• Sum of scores given by each respondent should be same. This needs to be checked
every time.
• If no. Of objects is too small or too large, giving score would be difficult.
In non-comparative scaling, objects are not compared with each other, but each object is
evaluated at a time independently. Hence non-comparative scale is also called ‘monadic
scale’.
• Continuous
• Itemized.
In ‘continuous scale’ (also called graphic rating scale), respondents rate objects by placing
mark at the appropriate place on the line that runs from one extreme of the criterion variable to
other extreme. Thus respondents are not restricted to marks set in advance by the researcher.
These scores are treated in interval scale.
Economical---------x-----------------------------------------expensive
Continuous rating scale is easy to construct. However scoring is cumbersome. Hence their use
in practice is limited. In practice, itemized rating scale is frequently used, which is described
below.
In ‘Itemized rating scale’, respondents are provided with a scale that has numbers or brief
descriptions. These numbers or descriptions are called ‘items’. Respondent is requested to
give his response for each criterion variable by using the numbers or brief descriptions given.
a) Likert scale
b) Semantic differential scale
c) Stapel scale
a) Likert scale:
Rensis Likert developed this scale. Each criterion variable has five responses viz. ‘strongly
disagree’, ‘disagree’, ‘neither disagree nor agree’, ‘agree’ and ‘strongly agree’. Numbers 1, 2,
3, 4, 5 or –2, -1, 0, 1, 2 are assigned five responses.
Numbers given above facilitate researcher to analyze data. Data analysis can be performed for
each criterion (profile analysis) or total (summated analysis).
In profile analysis, average score is calculated for each criterion and compared.
In summated analysis, total of scores is computed and analyzed. While giving score, most
favourable score will get score 5 and most unfavourable will get score 1. This is explained
below:
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Note the scores given to second and fifth criteria. Total score will be 19.
Since summated approach is frequently used, Likert scale is also called ‘summated scale’.
Likert scale is easy to construct and administer. However, it takes a longer time to administer
because respondent has to read each statement.
It is a seven point scale with end points associated with bipolar labels like weak/strong,
unreliable/reliable.
E.g. Rate ‘IFB’ washing machine on following criteria:
Note that favourable attributes
Strong--: --: --: --: --: --: --: delicate
can be on left as well as on right
poles.
Expensive --: --: --: --: --: --: --: economical
Individual items can be scored on
Durable --: --: --: --: --: --: --: non-durable
either –3 to +3 or 1 to 7 scale.
The resulting data is commonly
Good --: --: --: --: --: --: --: bad
analyzed through profile analysis.
Performance performance
Mean or median is computed for
profile analysis
Old fashioned--: --: --: --: --: --: --: modern
c) Stapel scale:
Jan Stapel developed this scale. It is a unipolar scale with 10 categories numbered from –5 to
+5, without 0. Higher the number, more accurately the term describes the object.
For e.g. ‘shoppers stop’ is:
+1 +1
High price wide variety
-1 -1
-2 -2
-3 -3
-4 -4
-5 -5
QUESTIONNAIRE DESIGN :
There are no scientific principles that guarantee optimal or ideal questionnaire. Hence
questionnaire design is a skill that can only be mastered by experience.
• Avoid leading questions. Leading questions are those that use negative phraseology.
For e.g. ‘wouldn’t you like to receive free gift from us?’
• Avoid such questions that respondent may not remember its answer:
E.g. Do you think fast food is tasty & provides nourishment? (incorrect
since double-barreled)
• Make sure that respondent has sufficient knowledge of the subject & he/she is the right
candidate as a respondent. For this purpose, use filter questions about familiarity with
the subject, product use, past experience etc before questions on research subject.
• In case of objection from respondent on the purpose of information, convince him that
information sought has a legitimate purpose.
For e.g. ‘will you accept corruption?’ will not produce variable response.
• Tendency to crowd question to make the question look shorter should be avoided. For
e.g.
--- below 1 lac --- 1 to 2 lacs --- 2 to 3 lacs --- 3 to 4 lacs --- 4 to 5 lacs ---
above 5 lacs.
• Transition between questions should be smooth. Grouping questions that are similar will
make questionnaire easier to complete.
• Leave some space at the end of questionnaire. Sometimes respondents give valuable
feedback which can be recorded here.
Use different colour papers for each category of respondent, if need be. For e.g.
Different questionnaires for public sector & private sector
• Do not print a question such that part of its content including response categories is
carried on next page.