Understanding and Using Market Research Data

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Understanding and Using Market Research Data

• Anita Kantak, Ph.D.
• Applied Research West, Inc.
• 11021 Winners Circle, Suite 208
• Los Alamitos, CA 90720
• [phone]

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Understanding Market Research Data

• What is Market Research?
• Market Research is the collection and analysis of
  information intended to assist management in
  decision making.
• Process includes Identification of objectives
  Determination of what information is known and
  what is needed Design of a survey instrument
  Design of an appropriate sample Data Collection
  Data Analysis Report Findings
• Process Includes Both Qualitative and
  Quantitative Methods

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Goals and Objectives of Qualitative Research

• Qualitative Research focuses on individual
  consumers in order to gain an understanding of
  their opinions and perceptions regarding various
  issues.
• Qualitative Research Frequently Involves the Use
  of
• In-depth Interviews
• Focus Groups

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Qualitative Research

• In-depth Interviews
• Usually conducted in a one-on-one setting
• Telephone Interviews
• Online (Chat Room) Format
• Convenience Sampling
• Focus Groups
• Group setting moderated by a trained professional
• Traditional Format
• High-Tech Alternatives

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Benefits Drawbacks of Qualitative Research

• Benefits
• Interviewers can modify or redirect the process,
  which often generates far more detailed
  information from respondents than other survey
  instruments (such as questionnaires or
  self-administered surveys).
• Intended to provide detailed information about
  individual consumers and their motivations and
  preferences.
• Drawbacks
• The results are not based on scientific or
  statistical methods.
• Large amounts of information must be considered,
  which may be more time consuming if looking for
  specific details or immediate results.

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Quantitative Research

• Statistical Analysis can assist managers with
  decision making in a variety of ways.
• Most important areas include
• Market Segmentation
• Can help to answer important questions such as
  What are the market segments for the product or
  service? How large are the segments? How much
  does each one spend?
• Positioning
• What are customers perceptions of a product or
  service in given market segments relative to the
  competition?
• Product Attributes
• What do people prefer in a product or service and
  why? How important are the product features?

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Quantitative Research

• Pricing Strategies
• What combination of price and features generates
  the greatest demand for products? At what
  price/feature combination is profit maximized?
• Promotion
• What messages will motivate people to purchase
  products or services? Which types of promotion
  (advertising, personal selling, public relations,
  sales promotion, etc.) are likely to work best?
  Which media will most likely reach the target
  market(s)?
• Customer Satisfaction
• What are the key dimensions of quality for the
  product or service as perceived by customers? How
  satisfied are they? How can customer satisfaction
  be increased?

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Common Statistical Techniques Used In Market
Research

• Perceptual Mapping
• Used to determine the factors that discriminate
  between one product and another, and where a
  company is positioned relative to its competition
  on each of the factors.
• Conjoint Tradeoff Analysis
• Used to determine what features a new or existing
  product should have, what price should be
  charged, and what demand can be expected given
  various tradeoffs.

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Common Statistical Techniques

• Factor Analysis
• Assists in determining the fundamental reasons
  for consumer motivation to purchase certain
  products. This technique is often used to
  construct a companys advertising to reach its
  markets in a more direct and effective manner.
• Regression Analysis
• Used to determine the relationship between one
  variable and others. The nature of a relationship
  is expressed as a mathematical formula that may
  be used to predict a result.

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Segmentation Research

• Segmentation Research
• Market Segmentation assists in tailoring
  marketing efforts to specific groups of
  consumers, who can choose from a variety of
  alternatives in the marketplace.
• Segmentation involves dividing markets into
  segments of customers or potential customers who
  have similar characteristics, and who are likely
  to display similar purchasing behavior.
• Ensures that marketing efforts are reaching the
  target markets effectively and efficiently.

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Segmentation Research

• Based on Understanding Consumer Decision- Making
  Process
• Individual Needs and Motivation
• Demographics
• Product Awareness
• Purchasing Habits

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Consumer Decision-Making Process
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Segmentation Research Important Considerations

• Homogeneity within the segment Ensure that
  consumers in specific market segments have
  similar characteristics- this indicates the
  likelihood that they will exhibit similar
  purchasing behavior.
• Heterogeneity between segments Are the segments
  distinct from one another, and do they have their
  own unique characteristics?
• Segmentation Do not over-segment a market, which
  is costly and often ineffective it may be
  necessary to combine smaller market segments in
  order to effectively market products or services
  to a specific population.
• Meaningful Data Research is very important, but
  the goal is to ensure that the data can be
  implemented into marketing strategy.

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Market Segmentation Physical Attributes

• Physical Attributes
• GeographyGlobal region division by state, city,
  country or rural, population density
  climate-related factors or Census Information.
• Demographics Statistics of a given population,
  such as income number of individuals in a
  household age gender marital status and
  ethnic background.
• Socioeconomics Characteristics such as education
  level occupation household income type of
  dwelling length of residence, etc. Somewhat
  distinct from demographics, in that these are
  more complex factors.

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Market Segmentation Behavioral Attributes

• Behavioral Attributes
• Psychographics Often described as lifestyle
  characteristics, especially pertaining to
  attitudes, feelings and personality type.
• Product Usage Heavy Users vs. Light Users
  Manner in which the product is being used.
• Benefits Who can most benefit from the product,
  and what are the wants and needs of certain
  individuals?
• Other Elements Including media exposure
  marketing mix or perceptions and preferences.

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Applying Findings Derived From Research to the
Real World

• A study was conducted in 2004 to
• Define the category for water purification
  products
• Define what customers want from water
  purification products
• Understand the current perception of water
  quality and safety
• Determine the characteristics of specific
  demographic groups, and how marketing can be
  tailored to better suit the needs of different
  groups of consumers
• Identify the messages that will cause consumers
  to purchase water purification products
• Determine Product Usage Habits

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Applying Findings Derived From Research to the
Real World

• Industry-Specific Information
• Properly identify the category so that consumers
  know what the products are and how they can
  benefit from them
• Determine the amount consumers are willing to
  spend on these types of products
• Installation and feature preference
• Channels of product information
• How to better define the category to the
  consumer, leading to greater understanding and
  market acceptance
• Identification of key messages that will attract
  users to the category and motivate them to buy

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Applying Findings Derived From Research to the
Real World

• Specific Questions Pertaining To
• Overall perception regarding drinking water
  quality
• Awareness and perception of water supply source
• Sources of Information About Household Water
  Supply Quality
• Reasons for Concern Regarding Water Quality
• Willingness to Pay More for Higher Quality Water
• Awareness of Water Treatment Methods
• Product Usage and Evaluation
• Future Interest in Water Treatment Products

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Conclusions Information is a Necessity In
Todays Environment

• Answers to the previous questions and many others
  regarding the Water Quality Industry are
  available in the 2004 National Consumer Water
  Quality Research report, available from the
  National Water Quality Association.

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Conclusions Information is a Necessity In
Todays Environment

• In the Information Age, Market Research is
  becoming increasingly important for all
  businesses.
• Market Research is vital for companies in order
  for them to stay competitive in todays business
  environment.
• Market Research is available and affordable for
  all types of businesses, regardless of what types
  of goods or services they produce.

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Thank You for Your Attention

• Questions/Comments