MARKETING RESEARCH IMT03

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MARKETING RESEARCHIMT-03

• FACULTY Dr.R.P.SAXENA

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UNIT - 1NATURE AND SCOPE OF M.R.NEED TO KNOW
THE CUSTOMER

• What is Marketing ?
• Why to know the Customers ?

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WHAT IS MARKETING ?

• ANY INTERPERSONAL AND INTERORGANISATIONAL
  RELATIONSHIP INVOLVING AN EXCHANGE IS MARKETING .
• WILLIAM J.STANTON

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WHAT IS MARKETING ?

• The essence of Marketing is a transaction - an
  exchange- intended to satisfy human needs and
  wants.There are three elements in the marketing
  process
• (A) MARKETERS
• (B) WHAT IS BEING MARKETED
• (C) TARGET MARKET

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WHAT IS MARKETING ?

• Marketing is a social process by which
  individuals and groups obtain what they need and
  want through creating and exchanging products and
  value with others
• PHILIP KOTLER
• This definition includes following core concepts
  NEEDS ,WANTS and DEMANDS --- PRODUCTS------VALUE
  SATISFACTION---EXCHANGE TRANSACTION---MARKETS
  MARKETERS

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WHAT IS MARKET ?

• A market consists of all the potential customers
  sharing a particular need or want who might be
  willing and able to engage in exchange to satisfy
  that need or want.

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WHAT IS MARKETING ?

• Marketing is the management process which
  identifies, anticipates, and supplies customer
  requirements efficiently and profitably.
• In other words, it is the process of
  understanding, creating, and delivering
  profitable value to targeted customers better
  than the competition.

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WHAT IS MARKETING ?

• Its aim is to establish, maintain, enhance long
  term relationship with customers at a profit so
  that the objectives of the parties involved are
  met.
• In short marketing consists of attracting,
  developing, and retaining profitable customers.

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WHAT IS THE PURPOSE OF BUSINESS ?

• Peter Drucker says
  ---The purpose of the business is to
  create customers.
  
• This statement can be made more explicit by
  stating
  ---The purpose of business is to
  create long-term profitable customers.

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BUSINESS IS MARKETING

• Marketing can not be considered as a separate
  function , it is the whole business, seen from
  the point of view of its final results............
  .....that is profit,through customer satisfaction
  

PETER DRUCKER
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WHAT IS MARKETING MANAGEMENT ?

• Marketing Management is the analysis, planning,
  implementation and control of programs designed
  to create, build and maintain beneficial
  exchanges and relationships with target markets
  for the purpose of achieving Organisational
  objectives.

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MARKETING CONCEPT

• LOVE THE CUSTOMER , NOT THE PRODUCT

Learn what they want(MR)
Produce it
Consumers
Market it
Sell what they want(Satisfy needs of customers)
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THE MARKETING CONCEPT

• The key to achieving organizational goals consist
  in determining the needs and wants of target
  markets and delivering the desired satisfactions
  more effectively and efficiently than
  competitors.
• And build profit through customer satisfaction
  and loyalty.

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MARKETING SYSTEM

• Marketing is concerned with the flow of goods and
  services from the points of production to the
  points of consumption. There is a systematic
  arrangement of these functions of marketing to
  move the goods and services to the needy persons.
  This system is essential to the creation of time,
  place and possession utilities.

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MARKETING SYSTEM

• A dynamic marketing system must be willing to
  undertake the following specific activities
  
  1. Define market area.
  2. Research consumer wants
  and needs.
• 3. Develop and redevelop product / service.
  4. Select,train,motivate and control
  human
  resources.
  
• 5. Develop sales approach and advertising
  support.
  

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GOALS OF THE MARKETING SYSTEM

• (1) MAXIMIZE CONSUMPTION
• (2) MAXIMIZE CONSUMER SATISFACTION
• (3) MAXIMIZE CHOICE
• (4) MAXIMIZE LIFE QUALITY

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THREE BASIC PRINCIPLES OF MARKETING

• The essence of marketing can be summarized in
  three great principles. The first identifies the
  purpose and task of marketing, the second the
  competitive reality of marketing and third the
  principal means for achieving the first two.

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THREE BASIC PRINCIPLES OF MARKETING

• (1) . The Customer Value and Value
  
• Equation
• VB/P Where VValue
• B Perceived
  Benefits
• P Price
• (Value is increased by increasing the numerator
  and/or reducing the denominator)

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THREE BASIC PRINCIPLES OF MARKETING

• (2).Competitive or Differential Advantage
• The total offer must be more attractive than
  that of the competition in order to create a
  competitive advantage.
• (3).Focus or the Concentration of
  
• Attention The task of creating
• Customer Value at a Competitive advantage.

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VALUE MAP
Value Disadvantaged Area
VEL
C
Perceived Price
E
B
D
A
Value Advantaged Area
Customer Perceived Benefits
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CUSTOMER AS THE CONTROLLING FUNCTION
Production
Finance
CUSTOMER
Personnel
Marketing
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MARKETING AS THE INTEGRATIVE FUNCTION
Production
Marketing
CUSTOMER
Finance
Personnel
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INTEGRATIVE FUNCTIONS OF MARKETING

• The companys assets have little value without
  existence of customers.
• The key company task is therefore to attract and
  retain customers.
• Customers are attracted through competitively
  superior offers and retained through satisfaction.

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INTEGRATIVE FUNCTIONS OF MARKETING

• Marketings task is to develop superior offer and
  deliver customer satisfaction.
• Customer satisfaction is affected by the
  performances of the other departments.
• Marketing needs to influence these other
  departments to co-operate in delivering customer
  satisfaction.

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CHARACTERISTICS OF A MARKET ORIENTED COMPANY

• A set of beliefs that puts the customers
  interest first.
• The ability of the organization to generate,
  disseminate, and use superior information about
  customers and competitors.
• The coordinated application of inter-functional
  resources to the creation and delivery of
  superior customer value.

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MARKET- DRIVEN AND MARKET- DRIVING COMPANY

• Market-driven companies focus on researching
  current customers to identify their problems,
  gather new ideas, develop products that result in
  incremental improvements, not radical
  innovations.
• Market-driving companies generate significantly
  new products, services, business formats and
  raise our sights and our civilization.
  These companies are
  much more than customer-led. They lead customer
  where they want to go, but dont know yet.

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BROAD OBJECTIVE OF MARKETING

• To grow the business by adapting it to changes in
  the environment
  -by
  monitoring
  . Changes in
  customer needs
  . Changes in competition
  . Changes in
  the companys own skills/resources
  -looking for
  opportunities threats that arise from
  
  these changes
  -initiate
  tactical actions that fit the companys
  offering to these opportunities/threats.

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BUILDING A MARKETING STRATEGY

• Generic Strategies For DIFFERENTIAL
  ADVANTAGE .......Product Differentiation
  ....... Cost Leadership
  ..........Special Market Focus

• Selection Of
• TARGET
• MARKET
• and development of a
• POSITIONING
• STRATEGY

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BUILDING A MARKETING STRATEGY

• For attaining organizational goals and fulfilling
  objectives, managers need information from their
  final consumers, in order to be able to satisfy
  their wants and needs, and to design effective
  marketing programs, while still earning a profit.

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KNOWING THE CUSTOMER IS MUST

• At least five such information topics are of
  great interest to marketing managers, for that
  knowing the customer is must.
• (1) TARGET MARKET
• What is the best target market for the products
  or services offered by the organization ?
• How large is the target market and how can it be
  described ?
• What are the attitudes, opinions, preferences,
  life styles, and so on of its members ?

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KNOWING THE CUSTOMER IS MUST

• (2) PRODUCTS/SERVICES
• How satisfied or dissatisfied is the target
  market with what is currently available ?
• What product features and benefits do those
  consumers desire ?
• How do they compare the companys product with
  those offered by competitors ?

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KNOWING THE CUSTOMER IS MUST

• (3) PRICE
• How much value does the target market place on
  the product in question ?
• How customers will react to the price change ?
• What substitutes, at what prices are available to
  customers ?

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KNOWING THE CUSTOMER IS MUST

• (4) PLACE/DISTRIBUTION
• What distribution channel is the target market
  most likely to use ?
• What place utility the customers expect ?
  (from the company and product in question)
• (5) PROMOTION
• What appeals most to the target market ? (what
  message, which media, what type of promotion, how
  to gain competitive advantage ? etc. etc.)

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DEFINITION AND MEANING OF M.R.

• What is Marketing Research ?
• Purpose of Marketing Research
• To facilitate the decision making process
• To reduce the risk associated with the decision
  making process
• To help firms in discovering new opportunities,
  which can be profitably exploited

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DEFINITIONS TO M.R.

• According to American Marketing
  Association -
• M.R. is the systematic gathering, recording
  and analyzing of data about problems related to
  the marketing of goods and services.

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ACCORDING TO TULL AND HAWKINS

• M.R. is systematic and objective search to
  analysis of situation relevant to the
  identification and solutions of any problem in
  the field of marketing. The decision making
  process becomes much easier by M.R. (i.e.
  PROBLEM IDENTIFICATION PROBLEM SELECTION
  PROBLEM SOLUTION)

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ACCORDING TO GLASSER

• M.R. is the application of scientific methods to
  the study of factors that affect buying decisions
  in a given market and profitability of the
  business concerned.

ACCORDING TO WENTZ

• M.R. is the gathering and analysis of
  information to be used by the manager to make
  marketing decisions. These decisions involve
  manipulation of firms promotion, pricing,
  distribution and product variable.

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ACCORDING TO PHILIP KOTLER

• M.R. is systematic problem analysis, model
  building and fact building for the purpose of
  better decision making and control in the
  marketing of goods and services.
• The dictionary meaning of research is to study or
  to investigate in a field of knowledge i.e.
  systematic and careful study.
• M.R. is the application of scientific techniques
  to problem and helps in better decision making
  for a marketing manager.

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WHEN TO USE M.R. (Common Situations)

• when the organization lacks information needed to
  make a marketing decision.
• when it is evaluating alternatives and is not
  sure which one to use.
• when there is a conflict within the organization
  over some policy, objective or strategy.
• when symptoms of a problem such as declining
  market share or weakening distribution have been
  detected.

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WHEN TO USE M.R. (Common Situations)

• When a marketing program is going well and
  company wants to know Why, so that it can
  maximize opportunity.
• When a new program or policy has been undertaken
  i.e. new product, revised price, a new
  distribution channel, a new package, new
  advertising campaign, or a new target market.

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APPLICATIONS OF M.R. (MANAGEMENT USE OF M.R.)

• A. In different stages of Administration Process
• B. In different areas of Marketing.
• ROLE OF M.R.
• The role of M.R. in a firm is determined by - 1.
  Nature of the business, 2. Size of the business,
  3. Attitude of top management towards the
  marketing functions (i.e. Philosophy adopted by
  them)

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UNIT - 2M.R. PROCESS

• Defining the Problems and Research Objectives
• Developing the Research Plan
• Collecting the Information
• Analyzing the Information
• Presenting the Findings

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SCIENTIFIC METHOD

• SCIENTIFIC METHOD is characterized by two
  traits Validity and Reliability
• Validity is the characteristic used to describe
  research, which measures what it claims to
  measure.
• Reliability is the characteristic of research
  methodology which allows it to be repeated again
  and again by the same and by different
  researchers, but always with the same results.
  Scientific method can minimize elements of
  uncertainty. It reduces the danger of making a
  wrong choice between alternative course of
  action.

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SCIENTIFIC METHOD

• Scientific method in physical sciences and
  marketing ?
• Specific characteristics of the scientific method
  
• I. Objectivity of the investigator
• II. Accuracy of Measurement
• III. Continuing the exhaustive nature of
  investigation.

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7 Steps Involved in Scientific Method

• 1) Observation of Phenomenon (observation Of
  facts)
• 2) Framing of Hypothesis (supposition made at
  reasoning)
• 3) Setting objectives
• 4) Experimentation
• 5)Observation and recording
• 6) Analysis
• 7) Result or principle or theory

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DEVELOPING THE RESEARCH PLAN

• Calls for decisions on
• Type of Research Design (Exploratory or
  Conclusive) and Research Approach (which specific
  method)
• Data Required (Primary data and Secondary Data)
• Data Sources ?
• Data Collection Methods Observation
• 
  Survey
• 
  Experimentation
• 
  (Contd.)

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DEVELOPING THE RESEARCH PLAN

• Specific Research Instruments
• Observation Method Camera,
• 
  Voice recorder,
• 
  Tally sheets
• Survey Method - Questionnaire
• (Structured/Unstructur
  ed)
• (Disguised/Nondisguise
  d)
• (Open ended/Closed
  ended)
• Experimentation - Lab/Field
• (Mechanical
  Instruments)

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DEVELOPING THE RESEARCH PLAN

• Sampling Plan
• Sampling Unit (Who is to survey?)
• Sampling Size (How many to survey?)
• Sampling Procedure (How to select?)
• Probability or Non-probability Method
• (which specific method
  ?)
• Sampling Media (How to reach to your
• 
  respondents?)
• Telephone/Mail/Personally

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MARKETING DECISION SUPPORT SYSTEM

• A growing number of organizations are using a
  marketing decision support system to help their
  marketing managers make better decisions.
• A MDSS is a coordinated collection of data,
  systems, tools and techniques with supporting
  software and hardware by which an organization
  gathers and interprets relevant information from
  business and environment and turns it into a
  basis for marketing action.

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MARKETING INFORMATION SYSTEM (MIS)

• Consists of people, equipment, and procedures to
  gather, sort, analyze, evaluate, and distribute
  needed, timely, and accurate information to
  marketing decision makers.
• The role of the MIS is to assess the managers
  information needs, develop the needed
  information, and distribute that information in a
  timely fashion.
• The information is developed through internal
  accounting records, marketing intelligence
  activities, marketing research, and marketing
  decision support analysis.

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INTERNAL RECORD SYSTEM AND MARKETING INTELLIGENCE
SYSTEM

• The internal records system supplies results data
  (i.e. reports on orders, sales prices, costs,
  inventory levels, receivables, payables etc.)
• The marketing intelligence system supplies
  happenings data. This system is a set of
  procedures and sources used by managers to obtain
  everyday information about developments in the
  marketing environment. (Sales representatives are
  the companys eyes and ears, they are
  positioned to pick up information missed by other
  means.

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MARKETING RESEARCH SYSTEM

• Marketing Research is the systemic design,
  collection, analysis and reporting of data and
  findings relevant to a specific marketing
  situation facing the company.
  (Philip Kotler)
• According to American Marketing Association M.R.
  is the systemic gathering, recording and
  analyzing of data about problems related to the
  marketing of goods and services.

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UNIT - 8SEGMENTING THE MARKET

• Instead of trying to market what is easiest for
  us to market, we must find out much more what the
  consumer is willing to buy .. We must apply
  our creativeness more intelligently to people,
  and their wants and needs, rather than to
  products.
• (Charles G. Mortimer)
• A marketer should have deeper understanding of
  markets, which are the starting point for all
  marketing planning and control.

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MARKETS EXHIBIT VAST DIFFERENCES

• A marketer should have deeper understanding of
  markets, which are the starting point for all
  marketing planning and control.
• To understand a particular market, one should
  first have a working knowledge of the important
  institutional characteristics of five types of
  markets

Reseller Market
Consumer Market
Producer Market
COMPANY (PRODUCT)
Govt. Market
International Market
(Buying motives are different in each market,
therefore different selling techniques will be
used for gaining success in each market)
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STUDY OF CONSUMER BEHAVIOUR

• Because markets are complex , we need to develop
  some common framework for grasping a markets
  essentials.
• The marketer should approach the study of a new
  market by asking 4 questions
• 1. What does the market buy ? Objects Of
  Purchase
• 2. Why does it buy ? Objectives of purchase
• 3. Who buys ? Organization of purchase
• 4. How does it buy ? Operations of
  purchasing organization
• ( FOUR Os OF A MARKET )

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6 Os OF A MARKET

• The 4 Os of a market (Objects, Objectives,
  Organization and Operations) should be grasped
  before one contemplates the 4 Ps of the marketing
  mix.
• Two further questions of a more descriptive
  nature can also be asked of a market
• 5.When does it buy ? Occasions for purchase
• 6. Where does it buy ? Outlets for purchase

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A SIMPLE MODEL OF CONSUMER BEHAVIOUR
OUTPUT
INPUT
PROCESS
External Influences
Consumer Decision Making
Consumer Decisions and Actions
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MARKETS DIFFER IN THEIR DEGREE OF HETEROGENEITY

• consumers are numerous and they behave
  differently to different product offers and in
  different situations.
• Markets differ in their degree of HETEROGENOITY.
  At one extreme they are HOMOGENEOUS (similar) and
  at the other extreme they are HETEROGENIOUS
  (substantially different).

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MARKETS DIFFER IN THEIR DEGREE OF HETEROGENEITY

• Most markets are too large for an organization to
  provide all the products or services needed by
  all the buyers in that market.
• Some division of market is necessary for the sake
  of EFFICIENCY and because of LIMITED RESOURCES.

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MARKET SEGEMENTATION

• Rather then trying to compete in an entire
  market, each company must identify the parts of
  the market that it can serve best. (MARKET
  SEGEMENTATION).
• Every company must make a determination not only
  of what needs to serve, but also WHOSE NEEDS.
• Sellers have not always practiced this
  philosophy. Their thinking has passed through
  three stages
• Mass marketing
• Product variety Marketing
• Target Marketing

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TARGET MARKETING

• Today, most of the companies are moving towards
  target marketing.
• Target marketing can help sellers in a better way
  to understand and find their marketing
  opportunities.
• Sellers can develop the right product for each
  target market and adjust their prices,
  distribution channels and advertising to reach
  the target market efficiently.
• They can focus on the buyers who have greater
  purchase interest. (TARGET MARKET SELECTION).

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TARGET MARKET

• A TARGET MARKET consists of a set of buyers who
  share common needs or characteristics that the
  company decides to serve.
• A firm can adopt one of the three market coverage
  strategies Un-differentiated , Differentiated,
  Concentrated Marketing.

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BASES FOR SEGMENTING MARKETS(MAJOR VARIABLES
USED FOR SEGMENTATION)

• BUYERS CHARACTERISTICS
• GOEGRAPHIC Region, country size, city size,
  Density (Urban, Rural), climate (Northern,
  Southern)
• DEMOHRAPHIC(Age, Gender, Family Size, Family
  Life Cycle, Income, Religion, Race)
• PHYCHOGRAPHIC (Social Class, Lifestyle and
  Personality)

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BASES FOR SEGMENTING MARKETS

• BUYERS RESPONSE
• BEHAVIOURAL (Purchase Occasion, benefits
  Sought, User Status, Usage Rate, Loyalty Status,
  Readiness Stage, Attitude toward product).
• Segmentation requires the use of a dependent
  variable as well as independent variables. The
  independent variables seek to explain the
  elasticity in the base or dependent variable and
  is called descriptors.

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RESEARCH DESIGN FOR SEGMENTATION MODELS

• There are three major approaches RESEARCH
  DESIGNS to identify and measure differences
  between market segments.
• A PRIORI SEGMENTATION
• CLUSTER BASED SEGMENTATION
• COMBINATION OR PRIORI AND CLUSTER MODEL

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(1) A PRIORI SEGMENTATION

• This is the first and oldest approach which
  starts by selecting the basis for segmentation
  using such variables as demographics, and then
  proceeds to collect data such as product usage,
  or ownership, media habits and attitudes.
• The results show how the segments vary with
  respect to such variables.
• This model selects in advance both the basis for
  segmentation and the set of descriptors to be
  used. Thus the number and type of segments are
  predetermined.
• Studies require large samples.

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(2) CLUSTER BASED SEGMENTATION

• In this kind of segmentation model, the number
  and type of segments are not known in advance.
• Respondents are clustered on the basis of their
  similarities with regard to a selected set of
  variables such as benefits wanted, life style and
  attitude. In a manner similar to a priori
  studies, the size and other market
  characteristics are then obtained.

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CLUSTER BASED SEGMENTATION

• In its simplest form cluster-based segmentation
  represents a reversal of a priori approach.
• For example, in a study concerned with usage
  rates, clusters of heavy and light buyers of
  selected products were formed, followed by a
  description of each in terms of their
  demographics.

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(3) A COMBINATION OF PRIORI AND CLUSTER BASED
MODEL (HYBRID MODEL)

• This segmentation model combines the two
  approaches. The sample could be divided on the
  basis of certain demographic characteristics,
  such as age, and gender, then the respondents in
  each segment clustered on some other basis, such
  as benefits wanted or needs.
• Very large sample sizes are needed.

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BENEFIT SEGMENTATION (NEW APPROACH)

• Segmentation is based on the benefits wanted from
  a product.
• A score is obtained by scaling the extent to
  which each brand is perceived as possessing
  certain characteristics and the importance
  attached to each by the consumer. Based on the
  scores for each brand, a prediction is made of
  the individuals preference ranking.
• In its complete form such a segmentation model
  will show the consumers ideal combination of
  product characteristics.

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SEGMENTATION AND THE RESEARCH PROCESS

• Marketing research can make valuable
  contributions to the determination of a segments
  attractiveness.
• Most segmentation studies involve complex designs
  . revolving around several hybrid bases for
  segmentation. however , because one cannot know
  in advance which basis for segmentation will lead
  to the identification of meaningful segments,
  segmentation studies should be flexible, allowing
  diverse analysis aimed at the identification of
  relevant segments.

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UNIT - 3TYPES OF RESEARCH DESIGNS

• Research Design is the specification of methods
  and procedures for acquiring the information
  needed to structure or to solve problems.
• The main characteristics of R.D. may be summed up
  in two words - Anticipation and specification.
• The researcher anticipates the needs and the
  circumstances of the proposed study, and
  specifies in advance what to obtain and what to
  do , in broader form.

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TYPES OF RESEARCH DESIGNS

• Research Design establishes the relationship
  between Causal variable (action) and Effect
  variable (outcome).
• Types of Research Designs
• (1) Exploratory
• (2) Conclusive -
  (a) Descriptive
  (b) Experimentation

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EXPLORATORY RESEARCH DESIGN

• Main purpose is identification of problems, more
  precise formulation of problems, identifying the
  relevant variable and the formulation of new
  alternative courses of action.
• Main objective of exploratory RD is to find tune
  the broad problem into specific problem statement
  and generate possible hypotheses.

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EXPLORATORY RESEARCH DESIGN

• Gives useful direction for further research.
• Establishes research priorities.
• Gives the researcher a feel of the problem
  situation and familiarizes him with the problem.
• Qualitative in nature.
• A new hypothesis is developed when a researcher
  has a tentative answer to a question, it is
  called a hypothesis)

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EXPLORATORY RESEARCH DESIGN

• Seeks to discover a new relationships.
• Hypothesis is developed on the basis of
  influencing variables which are available.
• Suggests possible solutions to the given problem.
• Provides sharper focus to the situation and a
  clearer definition of the problem at hand.
• Design of the study is highly flexible and
  informal.

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EXPLORATORY RESEARCH DESIGN

• Rarely formal design exists.
• Formal and standardized questionnaires are
  replaced by judgement and intuitive inference
  drawing on the basis of collected data.
• Convenience sampling rather than probability
  sampling characterizes exploratory design.

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EXPLORATORY RESEARCH DESIGN

• Primarily develops and understands new hypotheses
  to cover all the possible outcomes.
• The researcher develops new hypotheses on the
  basis of his prior knowledge, probing of
  executives and getting familiar with the related
  marketing conditions.

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EXPLORATORY RESEARCH DESIGN

• Exploratory research lays the foundation of a
  good research design which would satisfy the
  research objectives.
• Exploratory research is generally to be followed
  by conclusive research. Sometimes, the
  exploratory research itself may be enough to
  solve the problems.
• Imagination of the researcher is the key factor.
  The researcher may be constantly changing his
  focus of investigation as new possibilities come
  to his attention.

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METHODS USED IN EXPLORATORY RESEARCH

• The generally used methods in exploratory
  research are
• A. Search of Secondary Data.
• B. Survey of Experts.
• C. Case study method.

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METHODS USED IN EXPLORATORY RESEARCH

• A. Search of Secondary Data
• Internal sources,
• External sources.
• Example
• A company would like to launch fresh orange
  juice, with no preservatives an no artificial
  flavours, as a new product in the soft drink
  segment. Currently, there is no fresh orange
  juice which is available from the organized
  sector. The only juice that is available is
  either from road side vendors or canned juice.

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A. Search of Secondary Data

• An exploratory survey would be required to
  understand the consumer attitudes towards this
  concept as also to assess the availability of raw
  materials i.e. oranges.
• The secondary data may be obtained through
  contacting various sources like
  1.Fruit Merchant Associations.
• 2.Pusa Institute, Delhi.
• 3.Ministry of Food Processing.
• 4.Ministry of Agriculture.
• 5.All India Food Preservers Association.
• 6.Natural Horticulture Board.
• 7.The consumption pattern of other soft
  drink options, the rules and regulation with
  respect to this product must also be studied.

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A. Search of Secondary Data

• Various tables can be formed and secondary data
  can be analyzed for developing various new
  hypotheses, such as
• Table 1 Orange availability statistics (Area
  covered, production growth rate, yield etc.)
• Table 2 Orange Producing States (State, Main
  Districts, Volume etc.)
• Table 3 Economics for owning an orchard, how
  many oranges are required for making 1 ltr.
  Juice, the pack size, the price per pack, the
  Indian middle class segment, demographic
  characteristics etc., consumption pattern, demand
  level, consumer acceptance of the new concept etc.

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A. Search of Secondary Data

• Advantages
• Least expensive
• Quickest way to find possible hypotheses.
• Limitations
• The data available may not be reliable.
• The data may be designed for other specific
  purpose and use.
• Sometimes, it may be very time consuming to find
  the right data or identify the right source
• Survey of secondary data is not useful if it is
  not organized.
• Lack of objectivity because of investigators bias
  during collection and analysis phases

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METHODS USED IN EXPLORATORY RESEARCH

• B. Survey of Experts (Survey of Individuals with
  Ideas)
• Clue to solving many a marketing problems can
  be had by talking to individuals who have
  expertise and ideas about the research subject.
  These individuals could be top executives, sales
  managers, salesman and channel members who handle
  the product or related products and consumers or
  potential consumers etc. The information
  collection exercise does not involve a
  scientifically designed survey, it is merely an
  attempt gather all possible information about the
  subject of research from people who have specific
  knowledge about it.

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B. Survey of Experts (Survey of Individuals with
Ideas)

• There are two methods available and commonly used
  to survey individuals. With ideas. These are
• 1. In-depth interviews (Individual interviews and
  projective techniques)
• 2.Focus groups interviews

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Survey of Experts (Survey of Individuals with
Ideas)

• (1) In depth Interviews are generally used when
  the product concept is new or when motivations of
  consumers towards buying are sought or in cases
  of industrial goods/services when the number of
  end users are few, measuring consumer attitude
  and preferences etc. This technique is used to
  get a better focus on the environment of the
  product and this enables the researcher to
  formulate meaningful hypotheses to be tested.

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In depth Interviews

• Advantages
• Respondent is free to express his views and it is
  left to the skill of the researcher to develop
  new hypotheses related to the subject.
• Information which might be difficult to obtain by
  asking simple structured questions, can easily be
  obtained by depth interviews.
• Since the objective of exploratory R.D. is to
  find new ideas, this can be fulfilled by the
  depth interview method by giving greatest
  possible freedom of response to respondents.
• No formal questionnaire is used and interviewer
  has an outline in mind. In this method
  interviewer has a great deal of flexibility.

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In depth Interviews

• Limitations
• They are time consuming.
• There is excessive reliance on the skill of the
  interviewer.
• They do not facilitate the comparison between two
  interviews.
• The interpretation of the interviewer is final
  which may be biased and lacks the objectivity.
• Sample is small, generalization is not possible.

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In depth Interviews

• Example
• In depth interviews may be conducted on the
  ministry of agriculture using the following
  questions
• Why is it that no fruit juices are being marketed
  ?
• Which are the popular flavours ? Why they are
  popular ?
• What are the food standards for this product ?
• What is the volume of exports ? etc.

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Survey of Experts (Survey of Individuals with
Ideas)

• (2) Focus Group Interviews usually consists of
  6-12 individuals, brought together at one place
  to discuss a topic of interest. The purpose
  would depend on the objective of the research
  study. It could be discussing a new product
  concept, reactions to a new advertising campaign,
  reaction to the price orange, life style and
  preferences etc.

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Focus Group Interviews

• Advantages
• More useful in generating new ideas after long
  discussion and countering various ideas i.e.
  positive and negative ideas of each aspect can be
  noticed during the discussion.
• Bringing out the inner motivations of consumers.
• Letting the researcher have a first hand
  experience of the consumer reactions

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Focus Group Interviews

• Limitations
• Excessive reliance on the skills of the
  interviewer/moderator.
• Wrong combination of consumers in focus groups,
  resulting in non-tangible output.
• Using qualitative discussions quantitatively
  without checking them out.
• Usually more than one focus group is used to get
  a clear and unbiased understanding o the target
  market behavior and attitudes.
• One or few of the members in a group may dominate
  the discussion and their views may be taken as
  the group response

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Focus Group Interviews

• Example
• The product, fresh orange juice, with no
  preservatives was a new product concept in the
  soft drink market. The researcher was interested
  in probing the consumer about who would be more
  likely to consume the drink and on what
  occasions. The focus group may have three
  housewives belonging to upper income group, 3
  working females, three or four college
  going/growing children, younger unmarried working
  women etc.

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Focus Group Interviews

• Moderator may get the desired information if
  discussion is based on following points.
• What do you take as a breakfast drink ?
• Do you like the taste of orange juice and would
  you like to take it regularly ?
• When would you most prefer to have the orange
  juice, what would you prefer to give to children,
  to visitors and guests etc.
• The views obtained by the focus group, as well as
  the secondary data collected and in depth
  interviews with knowledgeable persons, led the
  researcher to formulate new hypotheses.

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Focus Group Interviews
Such as following Hypotheses

• consumption of orange juice as a breakfast

drink depends on the age of the consumers.

• The cost of the juice being high, it might be

beyond the reach of over the middle class.

• The product concept of fresh orange juice is

mainly to be taken only occasionally
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METHODS USED IN EXPLORATORY RESEARCH

• C. Case study method
• The problems where it is often difficult to
  single out a list of independent factors of study
  where complex into-relationships exist and also
  where the sources of information are very few are
  studied in complete detail, for all the possible
  alternatives. All the selected cases would have
  to be studied in detail considering three
  important factors (Contd.)

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Case study method

• features which are common to all cases in general
  groups
• features which are not common to all cases but
  are common to certain sub groups
• features which are unique to a case
• Observations can be used to define the research
  problem to test the significance of the common
  features as well as differences.

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Case study method

• This method involves intensive study of one or a
  relatively small number of situations such as few
  consumers, few retailers, few sales personnel,
  few markets etc. Where understanding the
  individual factor is difficult, understanding of
  the relationships of factors is essential to
  defining the problem. Example - In one study to
  improve the productivity of sales force of a
  particular company, the investigator studied
  intensively two or three of the best salesman and
  two or three of the worst. The study was based
  on finding all common features and various
  differences and unique features. This method is
  very much relevant in case of industrial products
  where the end-use industry might be just a single
  one or very few.

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Case study method

• Advantages
• Inferences are made on the entire picture and not
  some of its parts.
• A case study is a description of a real event or
  situation.
• All the people actually concerned with the
  problem are contacted and the data is obtained
  informally as well.

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Case study method

• Limitations
• Time consuming procedure.
• Heavy reliance on investigators.
• Absence of formal information gathering
  techniques resulting in very generalized and
  random information which might not be useful at
  all.

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Case study method

• Examples
• A study of 5-6 exporters of different products
  was carried out to give a complete view of
  packaging profile of horticulture and
  floriculture products. Product export packaging
  profile.
• Table 1 Product Flowers
• Export to countries UK, USA, Japan, Italy
• Model of transport --- Air, -- Sea
• Problem Areas High freight, or high taxes etc.
• Current Packaging
• Concept used
• Future requirements
• Table 2 - Product Mushrooms etc.

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CONCLUSIVE RESEARCH DESIGN

• This essentially follows exploratory research or
  after the hypotheses have been designed.
• Quantitative in nature.
• Aims at testing the hypotheses which already
  exist.
• Helps in making decisions.
• It establishes relationships between variables
  and gives a complete account of the strength of
  these relationships.

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CONCLUSIVE RESEARCH DESIGN

• Can be classified into two categories
• (a) Descriptive Research
• Statistical Methods
• Case Methods
• (b) Experimentation
• Lab Experiments
• Field Experiments

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(A) DESCRIPTIVE RESEARCH

• This method describes a particular situation and
  the influencing variables in that situation e.g.
  the relationship between age, income level and
  sales. How these variables and related is
  studied in Exploratory Research but how much
  change in income gives how much change in sales
  is studied in conclusive research.

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DESCRIPTIVE RESEARCH

• A descriptive study must collect data for a
  definite purpose. It should obtain a complete
  and accurate description of a situation.
• The advantage of descriptive research lies in the
  formality it offers with respect to data
  collection and analysis.
• On the other hand, if the study is not designed
  well, it results in biases.

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DESCRIPTIVE RESEARCH

• Two types of descriptive research studied are
  commonly used, namely statistical method and
  case study method.
• (i) Statistical Method
• Statistical techniques are used to study a large
  number of respondents over a variety of factors
  stated in the hypotheses.

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DESCRIPTIVE RESEARCH

• (ii) Case-Study Method
• Techniques are similar to those used in
  exploratory research.
• When case method is used in exploratory research,
  the objective is to discover new ideas about
  relationship which are them tested by conclusive
  research under descriptive research.
• Under descriptive research, the procedure of case
  study method may be more or formalized, so that
  the points to be investigated are definitely
  known.

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DESCRIPTIVE RESEARCH

• There are two differences between statistical
  method and case study method, used under
  Descriptive Research (Conclusive Research).

Statistical Method
Case Study Method
1. Number of cases studied
More in number
Fewer
2. Detailed study of each case
Only a few factors
More complete
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DESCRIPTIVE RESEARCH

• From the descriptive statistics, researchers hope
  to gain ideas about cause and effect
  relationships which will provide help in planning
  marketing programs. This is usually done by
  designing a system of classification and
  cross-classification.
• For example the hypothesis established by
  exploratory research states that water coolers
  can be sold to factories having over 1000
  workers.

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100
1000
100
It is quite clear from the above table No. 2,
that most factories having over 1000 workers
own water coolers.
Cross classification is useful in indicating
possible relationship but it can not prove cause
and effect relationships.
Statistical designs must be such as to permit the
cross classification, which are very
important to the analysis.
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DESCRIPTIVE RESEARCH

• Advantages of statistical method
• 1. A large number of observations are made.
• 2. The statistical techniques yield reliable and
  valid results i.e. the results would hold true
  for a similar set of respondents during the same
  period or for any other researcher carrying out
  the same analysis on the earlier set of
  respondents.
• 3. Studies are very structured therefore rare
  chances for the researcher to manipulate the data
  intentionally or interpret the responses
  incorrectly.

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DESCRIPTIVE RESEARCH

• Disadvantages of statistical method
• Studies being inflexible once they are already in
  progress.
• Not able to prove cause and effect relationships.
  Also the direction of the relationship is not
  always very clear in statistical techniques e.g.
  between sales and advertising which causes which
  is not very important.
• The assumptions under which certain statistical
  models hold true may be difficult to fulfill in a
  practical situation

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DESCRIPTIVE RESEARCH

• Example
• The earlier taken example of fresh orange juice
  by using exploratory research established three
  hypotheses. Now those are to be tested. The
  information requirements were met by collecting
  data from over 50 respondents belonging to the
  upper income group, different age groups etc. A
  statistical frequency analysis and cross
  classification analysis will reveal the
  appropriate results.

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DESCRIPTIVE RESEARCH

• For example
• Age wise consumption of breakfast drink
• Respondents age Milk Orange juice Tea/coffee Total
  
• lt30 13 07 10 30
• gt30 04 02 14 20
• Total 17 09 24 50
• Income wise consumption
• Profession wise consumption

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(B) EXPERIMENTATION

• An experiment may be defined as the actual trial
  of a proposed course of action or other
  hypothesis under consideration, so conducted that
  its effects can be observed (measured)objectively
  and distinguished from the effects of extraneous
  variables. In this method real markets are used
  as subjects. Certain factors in the marketing
  situation are controlled to see the effect on
  certain other factors and establish a cause
  effect relationship.

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EXPERIMENTATION

• There are three important things to be
  considered.
• 1. Experimental Unit (e.g. Consumers, sales
  personnel etc.)
• 2. Experimental variable (Casual factor)
• 3. Dependent variable (Effect factor)

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EXPERIMENTATION

• TWO TYPES OF MARKETING EXPERIMENTATION
• 1. Lab experiments
• Provide higher level of internal validity
• Respondents can be carefully controlled and / or
  manipulated
• Cost is generally much less
• But it may not depict accurately the real world
  environment

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EXPERIMENTATION

• 2. Field experiments
• A number of experimental designs are used
  depending upon the requirements of the situation.
• 1. After Only Design
• 2. Before-After Design
• 3. Before-After with Control Group Design
• 4. Four Group Six Study Design
• 5. After Only with Control Group Design
• 6. Ex post Facts Design
• 7. Continuous Diary Panel Design
• 8. The Latin Square Design

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1. After only Design

• Difference between the experimental groups
  response before and after the experiment
• This is the simplest of all experimental designs.
  This design consists of measuring the dependent
  variable after and only after the experimental
  variable has been exposed to the experimental
  subjects.
• Experimental variable introduced Yes
• After Measurement Yes (X1)
• Effect of Experimental Variable X1 implicit
  before measurement

Experimental Group
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After only Design

• Mostly used in the measurement of advertising
  recall, day after recall etc. or measurement of
  increase in sales after a sales promotion scheme.
• This design has one important weakness, i.e. it
  does not consider the actual Before measure and
  therefore, this method is mostly used for new
  products, where the Before measure is Zero. In
  case this design is used for already established
  products, the measure is based on the past
  experience and judgement of the executives.

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2. Before After Design

• The experimental groups reaction is first
  measured before and after the experimental
  variable is introduced to them to check out the
  differences in behavior.
• Before measurement Yes (X1)
• Experimental Variable introduced Yes
• After measurement Yes (X2)
• Effect of Experimental Variable X2 X1

Experimental Group
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Before After Design

• For example a situation can be imagined A
  consumer entering a departmental store, may be
  asked his brand preference of detergent. The
  salesman at the store would be instructed to
  influence the choice towards a particular brand
  of detergent. The brand purchased by the
  consumer finally would indicate whether the sales
  people have been successful in influencing the
  brand choices of the consumer. A consumers
  intention to purchase earlier is compared with
  any changes at the time of final purchase on
  account of external stimuli like an advertisement
  or influence of the dealer etc.

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Before After Design

• Shortcomings of this design
• The longer the time gap between X1 and X2, the
  greater the danger that other variables will
  affect the results.
• Biological and Psychological changes may also
  effect the results.
• If the experimental unit is told in advance what
  is being measured, it will have an impact on
  results.
• These problems can be over come by introducing a
  control group.

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3. Before-After with Control Group Design

• The design consists of having a control group
  which is not subjected to the variable, versus
  the experimental group which is subjected to the
  variable. The difference of their differences
  would give an idea of the extent of
  uncontrollable variables present.

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Before-After with Control Group Design
Experimental Group
Control Group
Before Measurement Yes (X1) Yes
(Y1)
Experimental Variable Yes
No
After Measurement Yes (X2)
Yes (Y2)
Effect of Experimental Variable (X2-X1) -
(Y2-Y1)
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Before-After with Control Group Design

• The experimental and control groups are similar.
  The only difference is that the control group is
  not exposed to the experimental variable and
  therefore (Y2-Y1) is the result of other
  uncontrolled variables. For example the
  situation imagined in design No. 2 (i.e. before
  after design), this design can be used to study
  the effect of other variables. In the same
  situation described earlier, there could be
  consumers to whom the sales man does not
  deliberately push a particular brand. This would
  constitute the control group.

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Before-After with Control Group Design

• The differences between the purchase behavior of
  the control group and the experimental group
  would indicate whether uncontrollable variables
  had caused the change in behavior.
• Shortcomings
• 1. It is not possible to completely match the
  experimental and control groups.
• 2. Bias may be present in the results if the two
  groups are in different locations or measured at
  different times.

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4.FOUR GROUP SIX STUDY DESIGN

• To remove the bias which exists on account of the
  before measurement four groups are made, two as
  in the before after with control group (design
  No. 3) when the before measurement is not made.
  In addition to above two groups one control group
  and the other experimental group is also made.
  Theoretically, it will be the solution of four
  unknown quantities to find their differences.

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FOUR GROUP SIX STUDY DESIGN
Experimental Group Control Group
1 2
1 2
Before Measurement
Yes (X1) No Yes (Y1) No
Experimental Variable
Yes Yes No
No
After Measurement
Yes (X2) Yes (X3) Yes (Y2) Yes (Y3)
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FOUR GROUP SIX STUDY DESIGN

• All the four groups are selected in such a way
  that they are equivalent. Therefore it is
  presumed that the two before measurement will
  be approximately same (X1 Y1)
• Group Measured
• Exp. Group 1 (X2-X1)
• Exp. Group 2 (X3- ½ (X1Y1)
• Cont. Group 1 (Y2-Y1)
• Control Group 2 Y3- ½ (X1Y1)

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FOUR GROUP SIX STUDY DESIGN

• The disadvantages of Before After with control
  Group design can be removed by using four
  groups and doing proper calculations accordingly.
• The experiments of four groups six study design
  are difficult to set up and difficult to
  interpret and have little practical application
  although they are the ideal.
• Moreover it would be a very expensive method. It
  also creates statistical difficulties in testing
  the significance of results.

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5.AFTER ONLY WITH CONTROL GROUP DESIGN

• This is a logical modification of the previous
  design. In this case no before measurement is
  made but only the after measurement is made on
  the experimental group. The difference between
  the two would indicate the effect of the
  experimental variable.

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AFTER ONLY WITH CONTROL GROUP DESIGN
Experimental Group Control Group
Before Measurement
No
No
Experimental Variable
Yes
No
After Measurement
Yes (X1)
Yes (Y1)
Effect of Experimental Variable
X1 - Y1

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AFTER ONLY WITH CONTROL GROUP DESIGN

• This is the most widely used design. As compared
  to the four group six study design, this two
  group two study design is much simpler to
  administer and much less expensive. This design
  is generally used to test promotional devices.
• For example
• The experimental group may be sent certain
  privileged discount coupons for a sale, whereas
  the control group is not. The results of the
  sale would indicate whether the discount coupons
  are indeed useful in increasing the sales of the
  product.

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6.EX POST FACTS DESIGN

• This design is simply the variation of the after
  only with control group design. The only
  difference is that experimental and control
  groups are selected after the experimental
  variable is introduced. Advantages
• Test subjects cant be influenced in favor or
  against the subject because they do not know that
  they are being bested.
• This design permits the experiment to introduce
  the experimental variable at his will and to
  control only observations. This is useful in
  advertising tests which use commercial media.

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7.CONTINUOUS DIARY PANEL DESIGN

• The subjects are selected by some sampling
  procedure. In some cases, information is
  obtained continuously or at intervals over a
  period of time. The selected sample is known as
  panel.
• Experimental Group
• First measurement Yes (X1)
• Second Yes (X2)
• First Experimental Variable Yes
• Third Measurement Yes (X3)
• Second Experimental Variable Yes
• Fourth Measurement Yes (X4)
• And so on
• Measurements are taken at intervals and
  experimental variables are introduced when
  designed. This desired can be used to establish
  trends.
• This design is also weak because the sample is
  likely to get affected by uncontrolled variables.

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8.THE LATIN SQUARE DESIGN

• If the effect of a single variable is to be
  studied over different time periods and different
  geographic regions a design which takes into
  account possible combinations is made and the
  differences arising on account of either the
  geographic region or the time period are studied.

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THE LATIN SQUARE DESIGN

• For Example
• Suppose the owner of franchised outlets, say
  Bata, would like to know whether there is a
  difference in sales occurring on account of
  differences in three types of display used by
  three similar Bata stores, situated at different
  locations in Bombay for a period of three months.
• The design could be
• Month 1 2 3
• Bata store location
• Bandra Market A B C
• Linking Road C B A
• Andheri B A C
• Latin square designs are extensively used to
  establish cause-effect relationships in marketing
  situations

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Disadvantages of Experimentation Methods

• 1. The lapse of time between the before and
  After might be too long for the experiment to
  yield any significant results.
• 2. The experimental and control groups are not
  easily available and may not be very cooperative.
• 3. Experiments are short term affairs and do not
  suggest long term relationships between variables
  as a descriptive research would.
• 4. May be more expensive.
• 5.Competitors can easily get an idea of the
  activities of the company when experiments are
  conducted openly in the market.
• 6. Good for immediate results