Marketing Research Study Material
Marketing Research Study Material
Marketing Research Study Material
The main idea of marketing research is to know more about the consumers,
dealers, and the products. As the business grows, the distance between the
manufacturer and consumers also widens. The management depends upon the
marketing research as a tool in solving the marketing problems. It helps in taking
a fruitful and efficient decision as to the flow of goods and services in the hands
of the customers.
4. Analysis of the market size according to age, sex, income, profession, standard
of living etc.
5. Geographic location of customers.
13. To study the nature of the market, its location and its potentialities.
7. It helps a dealer to find out the best way of approaching potential buyers.
8. It helps to find out defects in the products and take corrective steps to improve
the product.
18. It helps the firm in knowing general conditions prevailing in the market.
2. Research on Sales:
It covers sales forecasting, quota selling, sales territory design and other sales
related activities. It analyses sales volume, salesman performance data, new
product performance in test markets, opinion on customer-related product data
etc.
3. Research on Product:
It involves new product development, brand image, concept tests, product tests,
test marketing of new product etc. It analyses the strength and weakness of
present products in relation to diversification, simplification etc.
2. Descriptive
3. Casual, and
4. Predictive.
1. Exploratory Research:
Exploratory research gives valuable insight, generates ideas and hypotheses
rather than measuring or testing them. “Exploratory research is concerned with
identifying the real nature of research problems and perhaps of formulating
relevant hypotheses for various tests”. Crimp stated that the researcher undertakes
exploratory research in order to generate an adequate basis for designing research
and it includes searching for data that are already available both within the
company and from external sources, consulting experts, conducting observational
studies, getting feedback from market place and surveys.
A marketing researcher uses this type of research when very little is known about
the problem being examined. The major benefit is that it is less expensive and
less time-consuming. For example, if a researcher is interested in finding out
“Which features or factors are vital in a purchase decision? and “What will be the
best mode of communication to reach the consumers? For all these purposes,
exploratory research gives an insight into the problem.
2. Descriptive Research:
Descriptive research is concerned with measuring and estimating the frequencies
with which things occur or the degree of correlation or association between
various variables. It has been seen that market research reports are often
descriptive and they measure market size, market structure, and the behaviour
and attitudes of consumers in the marketplace. In general as the data obtained by
descriptive research is put to various statistical analysis, it is very necessary to
make a list of the variables to be investigated and how these variables will be
measured.
3. Causal Research:
Causal research is basically concerned with establishing cause and effect
relationship and an attempt to explain why things happen. For example, to what
extent the price elasticity of demand or the degree to which advertising campaigns
have affected the sales may be explained by causal research.
An event may be considered as the cause of another event, if its occurrence is the
necessary and sufficient condition for the latter event to take place. A necessary
condition means that the caused events cannot occur in the absence of the
causative event. A sufficient condition means the causative event is all that is
needed to bring about the caused event.
4. Predictive Research:
The main purpose of predictive research is to arrive at a forecast or prediction or
some measurement of interest to the researcher. The ultimate target may be the
future sales level of the firm. Other goals of predictive research may involve
industry sales level, projection or growth or defining of firm’s product line and
the use of a test market to predict the likely success of a new product.
2. Market Intermediaries:
Market intermediaries are in integral link between the producers and the final
buyers. Selling a product requires a channel for bringing it to the market and
distributing it to the final buyers. Marketing research helps a manufacturer to
select a right kind of channel.
3. Business Firms:
Every business concern is interested in improving its position in the market
by:
(i) Increasing its market share, and
(ii) Increasing its profitability. In these cases, marketing research is essential and
highly useful tool that is used while taking a decision.
5. Government:
Research in various areas is also done by Government. For example: Price
indices. Per capita income etc.
6. Producers:
A competitive market is flooded with new products, new brands, and new
substitutes almost every day. The threat of cut-throat competition is always there.
He finds that the strategies that worked in the past but are no longer workable.
Here, MR helps in the analysis of the situations.
After identifying the problem, the researcher formulates a plan when the problem
is defined. The purpose of the project determines the nature of the problem and
the ways to solve it. When the researcher gets a clear idea of the problem, he
analyses the situation and understands more about the problem. He analyses the
company, its markets, its competition etc. The informal investigation or
preliminary exploration consists of getting background information relating to the
problem.
2. Determining the Information Needed:
The researcher must consider the information and decide which is relevant and
which is irrelevant to the study. In determining the kind of information needed,
the objectives of the research must be borne in mind. The information should be
necessary and relevant. If the available data are insufficient, fresh data have to be
collected.
The mean or median classifies the nature of the average respondent, and the
standard deviation shows how far respondents are dispersed around the average.
Tests of significance are useful in measuring whether two occurrences are related
to each other. It is important, for example, to know whether a price decrease
caused an increase in sales, or whether the two events just happened
simultaneously.
6. A table of contents, along with charts and diagrams followed in the report.
9. Appendices.
7. Follow up study:
Follow up will ensure the implementation of recommendations made by the
marketing researchers. Otherwise, the report may be left unopened.
2. External sources.
The internal sources mean and include a company’s profit and loss account,
balance sheet, sales figures, sales reports, inventory records, registers, documents
etc. A proper analysis of these records will reveal the degree of efficiency of the
business. The collection of information from internal sources is inexpensive.
When information cannot be collected from the internal sources, or when
available information is irrelevant and insufficient, then one will have to depend
upon the external resources-facts collected from outside the company.
1. Primary Data:
Primary data are those which are collected for the first time and they are original
in character. These are collected by the researcher himself to study a particular
problem.
2. Secondary Data:
The secondary data are those which are already collected by someone for some
purpose and are available for the present study. For instance, the data collected
during census operations are primary data to the department of census and the
same data, if used by a research worker for some study, are secondary data.
2. Observation method
3. Survey method
1. Experimental Method:
“This method of gathering primary data involves the establishment of a scale
model or a controlled experiment which stimulates the real market situation as
much as possible. The theory is that the small-scale experiment will furnish
valuable information in designing a large-scale marketing programme.” Under
this experimental approach, the producer carries out a small-scale experiment,
tries to get valuable information, which can be of great help in designing large-
scale marketing programme.
Merits:
1. This method is more realistic and gives best results.
2. This approach is more effective and profitable.
Demerits:
1. This method is expensive.
4. The test markets selected for the experiments must posses the same
characteristics, which is difficult.
2. Observation Method:
In Observation method, the data are collected by observing some action of the
respondent. No questions are asked in data collection. No interview is made. The
actions or behaviour of the customers are watched personally or mechanically.
Buyers may be observed personally by the observer while making purchases. The
observer or researcher poses as a customer, and observes the marketing situations.
A buyer is unaware that he is being observed and acts in his usual way. The
observer, posing as a customer, knows the ability of salesmen and the brand that
is being pushed through and also the motivating factors of the purchasers.
Merits:
1. It is more accurate.
Demerits:
1. The method is expensive.
3. Survey Method:
A survey consists of gathering data by interviewing a limited number of people
(a sample) selected from a larger group. A survey has the advantage of getting to
the original source of information. In this method, the researcher obtains
information from the respondents by interviewing them. This is the most common
method of getting primary data. This method is more effective than the
experimental and observation approach.
In the factual survey, respondents are asked to report actual facts, as exemplified
by questions such as: What brand of cigar do you smoke? How many persons live
in your house? Opinion survey is designed to gather expressions of personal
opinions, to record evaluations of different things or to report thinking on
particular matters.
For instance: How do you feel about this new cordless electric shaver? In the
interpretative survey the respondent acts as an interpreter as well as a reporter.
Interpretative data are gathered by using such questions as: Why do you use brand
‘A’ of the product in your house? What feature of the new pack of this product
appeals to you most?
The survey can also be conducted in two ways: sampling survey and census
survey. Under census survey, the marketer conducts surveys covering the entire
market. The data are collected from each and every person in the market. But
under sampling survey, only a part of the whole group will be studied. We may
study a sample drawn from the large group and if the sample is adequately
representative of the group, we should be able to arrive at valid conclusions. As
such, sampling survey is widely accepted.
Merits:
1. Original (first hand information) data are collected.
Demerits:
1. It is unsuitable where the area is large.
Suitability:
This system is more suitable, where the area to be studied is large. It is adopted
when direct information cannot be obtained. This system is generally adopted by
governments.
Merits:
1. It is simple and convenient.
Demerits:
1. Absence of direct contact is there; the information cannot be fully relied upon.
4. The careless attitude of the informant will affect the degree of accuracy.
To get quick and better response, the return postage expense is borne by the
investigator, by sending a self-addressed and stamped envelope. This method is
adopted by research workers, private individuals, non-official agencies and State
and Central Governments.
Merits:
1. Of all the methods, the mailed questionnaire method is the most economical.
Demerits:
1. In this method, there is no direct contact between the investigator and the
respondent. Therefore we cannot be sure about the accuracy and reliability of the
data.
2. This method is suitable only for literate people. In many countries, there are
illiterates who cannot understand and reply the questionnaire.
4. People may not give the correct answer and this leads to false conclusion.
6. Sometimes the informant may not be willing to give written answers, apart
from causing delay.
17.Framing a Questionnaire:
The questionnaire is the medium of communication between the investigator and
the respondent. The success of an investigation depends on the framing of the
questionnaire. As such, utmost care and caution are essential for designing or
drafting the questionnaire. In addition, it requires skill, wisdom, efficiency and
experience.
There are no hard and fast rules to be followed but the following general
points may be borne in mind:
1. The Questionnaire should be brief.
Merits:
1. The cost is less.
4. It is flexible.
Demerits:
1. Persons who have no phone connection are omitted.
Sampling:
Only a part of the whole group population will be studied in the case of sample
enquiry. According to Croxton and Cowdon, “It may be too expensive or too
time-consuming to attempt either a complete or a nearly complete coverage in a
statistical study. Further to arrive at valid conclusions, it may not be necessary to
enumerate all or nearly all of a population.
We may study a sample drawn from the large population and, if that sample is
adequately representative of the population, we should be able to arrive at valid
conclusions.” The results obtained form sample study can be applied to the whole
universe or population. We can study the characteristics of the population or
universe from the sampling. A study of a sample will give a correct idea of the
universe or population.
A truck load of product is accepted or rejected on the evidence gained from testing
only a few items. A physician makes inferences about a patient’s blood through
the examination of a single drop. Samples are devices for learning about large
masses by observing a few individuals.
Merits:
1. It saves time because fewer items are studied.
5. It is more scientific.
18.Methods of Sampling:
There are many methods of sampling. The choice of method will be determined
on the purpose of sampling.
Merits:
1. It is a scientific method.
Demerits:
1. This method requires a complete list of the population.
2. If the size of the sample is small, then it will not be a representative of the
population.
There are two types of stratified random sampling. They are proportional and
non-proportional. In the proportional sampling, equal and proportionate
representation is given to sub-groups or strata. If the number of items is large in
the population, the same will have a higher size and vice versa.
Merits:
1. It is more representative.
Demerits:
1. To divide the population into homogeneous strata, it requires more money,
time and statistical experience which is a difficult one.
2. If proper stratification is not done, the sample will have an effect of bias. If
different strata of population overlap, such sample will not be representative one.
k = N/n
k = Sampling interval
N = Size of universe
n = Sample size
In the above example k = 150/15 = 10.10 is the sampling interval. Every 10th
student will be taken as sample i.e., 10th, 20th, 30th and so on (OR) 1st, 11th,
21st and so on. (OR) 6th, 16th, 26th and so on.
Merits:
1. This is simple and convenient.
Demerits:
1. It may not represent the whole population.
Merits:
1. It introduces flexibility in the sampling method.
Demerit:
It is less accurate than other methods.
Merits:
1. It is a simple method.
3. It is very helpful to make public policies, decisions etc. The executives and
public officials use this method for their urgent problem
Demerit:
1. Due to individual bias the sample may not be representative one.
3. It must be random.
4. It must be adequate.
5. It must be proportional.
2. Libraries.
Without knowing the meaning and limitations, we cannot accept the secondary
data. Bowley points out. “It is never safe to take published statistics at their face
value without knowing their meaning and limitations, and it is always necessary
to criticize arguments that can be based on them.”
There are no clear cut solutions to the problem of budget to be fixed. It is difficult
to assess the expenditure of the research and the value of the result of a research
project. Costs will be more as the precision increases. Nature of the research work
and the size of the firm will decide the amount to be spent for the marketing
research.
3. If the researcher is biased to the problem, the results will be unsatisfactory and
misleading.
5. It is not an end itself. It presents the correct information for decision making.
Unless the information is used by a qualified manager, the study will be of no
use.
6. By the time the results are ready, the circumstances might have changed; and
then the whole study will be valueless.
10. Its use and effectiveness largely depends upon the ability of executives to get
the most value of it.
Thus day to day changes take place in the market. Changes may occur in the
market because of technological progress, expansion of markets, complexity
growth of market, changes in the consumption pattern etc. The changes that take
place in the markets must be understood by the management.
For this, the management must depend upon the marketing research as a guide. It
is an aid to the management. It places all necessary facts before the management,
who can shape the solution to the problems. Marketing research plays an
important role in decision-making.
4. It will not only increase sales, but also cut down the unnecessary expenses.
5. It will guide to achieve consumer satisfaction and sales profitability.
3. The management thinks that the amount to be spent on marketing research can
be used profitably for expansion and improvements of the products.
But marketing research in India will certainly in the long run, increase the profits,
eliminate the wastes, fetch consumer satisfaction, guide progress etc.