Video Case 5.1
Dunkin’ Donuts: Dunking the Competition
1.
Marketing research can help Dunkin’ Donuts determine what consumers are looking for
in a coffee and donut shop. For example, Marketing research in the form of focus groups and
survey research revealed that customers select a coffee and donut shop based on five factors:
accessibility, quality, variety, image, and affordability. This helped Dunkin’ Donuts formulate
sound marketing strategies to make improvements on all these factors. To illustrate, in order to
improve accessibility, Dunkin’ Donuts has opened locations in Home Depot, Wal-Mart, 7-11,
and Stop & Shop stores to add to the convenience that customers’ desire. Every location is
strategically placed and designed with these customer preferences in mind.
2.
The management decision problem is: What can Dunkin’ Donuts do to further expand in
the US in a profitable manner?
3.
The marketing research problem is to determine consumer preferences for coffee and
donut shops. Specifically, research should provide answers to the following questions:
a.
What criteria do consumers use in selecting a coffee and donut shop?
b.
How do consumers evaluate Dunkin’ Donuts and its competitor’s based on the
identified choice criteria?
c.
What is the potential demand for coffee and donut shops?
d.
What is the demographic and psychographic profile of consumers who prefer
Dunkin’ Donuts to competitors?
4.
Students should search an Internet database using the key words “coffee”, “donut,”
“coffee shops”, “coffee consumption”, etc. to identify the relevant data. They should also visit
Dunkin’ Donuts web site (http://www.dunkindonuts.com).
5.
Dunkin’ Donuts can benefit from a variety of syndicate data. Psychographic and lifestyle
data, such as those provided by the Yankelovich Monitor, can help the company discern trends
affecting consumers’ patronage of coffee and donut shops. Purchase panel data, such as those
provided by NPD, can help determine consumer patronage and expenditures on coffee and donut
shops. Firms like Nielsen Media research can provide data on media consumption habits
enabling Dunkin’ Donuts to target the right consumers. Finally, scanner data can provide
information on coffee and donut consumption.
6.
Both focus groups and depth interviews can be useful. Focus groups can generate new
insights and ideas, while depth interviews can uncover hidden motives, values, and beliefs. For
example, using qualitative research, the company found that quality translates to freshness in the
donut business, therefore, Dunkin’ Donuts makes donuts at least four times a day. The coffee is
brewed and then allowed to sit for no more than 18 minutes in all the locations. After the 18minute time window, the coffee is poured out, and a fresh pot is brewed. This commitment to
quality was made as a result of qualitative and survey research showing what the customer
desired in a cup of coffee.
7.
Personal interviews at representative coffee shop locations of Dunkin’ Donuts and other
chains could be used to determine the preference coffee shop goers have for the new pastries.
Sampling control will be a key factor. Only coffee shop goers should be included in the sample.
Use of physical stimuli is another key consideration. Respondents can taste the new pastries at
these locations and then respond to the survey questionnaire. Other advantages are complex
questions can be asked, very good control of the data collection environment, and there is a very
good response rate.
VC5 - 1
8.
Students should be asked to download the KitKat Taste Test from the Web site of this
textbook and use it as a guide to develop a script for testing for preference between two coffee
brands: Dunkin’ Donuts and Starbucks. Make sure the coffees are warmed to the same
temperature, and poured in three groups of identical cups. Each person will select a cup from the
first group, taste the coffee, eat a cracker, and take a swallow of water. This will be repeated for
each person when tasting from the second, and the third groups, also. (The first group might be
Dunkin’ Donuts, the second group Starbucks, and the third group Dunkin’ Donuts). After tasting
from each of the three coffee sample groups, have the respondents complete the survey form the
students create (similar to that in the KitKat document.) To avoid a biasing effect from the order
of presentation of the samples, it will be important for half of the respondents to have a rotated
order of presentation: (The first group Starbucks, the second group Dunkin’ Donuts, and the third
group Starbucks). The taste test should be conducted on 30 respondents/students.
9.
Questionnaire for assessing consumer preferences for coffee shops:
COFFEE SHOP QUESTIONNAIRE
PART A
Q1. How often do you visit a coffee shop?
a. One a month or less often
____
b. 2 or 3 times a month
____
c. Once or twice a week
____
d. Three or more times per week
____
Q3. Please rate the importance of the following factors in your selection of a coffee shop.
Not at all
Very
Important
Important
a. Quality
1
2
3
4
5
b. Image
1
2
3
4
5
c. Variety
1
2
3
4
5
d. Price/affordability
1
2
3
4
5
e. Convenience of location
1
2
3
4
5
Q4. Please rate your preference for the following coffee shops.
Not at all
Preferred
a. Krispy Kreme
1
2
3
4
b. Dunkin’ Donuts
1
2
3
4
c. Starbucks
1
2
3
4
d. Caribou Coffee’
1
2
3
4
e. Aurora Coffee
1
2
3
4
Q5. Please rate the following coffee shops in terms of Quality.
Poor
VC5 - 2
Very Much
Preferred
5
5
5
5
5
Excellent
Quality
a.
b.
c.
d.
e.
Krispy Kreme
Dunkin’ Donuts
Starbucks
Caribou Coffee’
Aurora Coffee
Quality
1
1
1
1
1
2
2
2
2
2
3
3
3
3
3
4
4
4
4
4
Q6. Please rate the following coffee shops in terms of Variety.
Poor
Variety
a. Krispy Kreme
1
2
3
4
b. Dunkin’ Donuts
1
2
3
4
c. Starbucks
1
2
3
4
d. Caribou Coffee’
1
2
3
4
e. Aurora Coffee
1
2
3
4
Q7. Please rate the following coffee shops in terms of Image.
Poor
Image
a. Krispy Kreme
1
2
3
4
b. Dunkin’ Donuts
1
2
3
4
c. Starbucks
1
2
3
4
d. Caribou Coffee’
1
2
3
4
e. Aurora Coffee
1
2
3
4
5
5
5
5
5
Excellent
Variety
5
5
5
5
5
Excellent
Image
5
5
5
5
5
Q8. Please rate the following fast food restaurants in terms of Price/Affordability.
Poor
Excellent
Price
Price
a. Krispy Kreme
1
2
3
4
5
b. Dunkin’ Donuts
1
2
3
4
5
c. Starbucks
1
2
3
4
5
d. Caribou Coffee’
1
2
3
4
5
e. Aurora Coffee
1
2
3
4
5
Q9. Please rate the following fast food restaurants in terms of Convenience of Location.
Poor
Excellent
Location
Location
a. Krispy Kreme
1
2
3
4
5
b. Dunkin’ Donuts
1
2
3
4
5
c. Starbucks
1
2
3
4
5
d. Caribou Coffee’
1
2
3
4
5
e. Aurora Coffee
1
2
3
4
5
VC5 - 3
Q10. Please indicate how frequently you eat in the following coffee shops.
Not at all
Very
Frequently
Frequently
a. Krispy Kreme
1
2
3
4
5
b. Dunkin’ Donuts
1
2
3
4
5
c. Starbucks
1
2
3
4
5
d. Caribou Coffee’
1
2
3
4
5
e. Aurora Coffee
1
2
3
4
5
Q11.
a.
b.
c.
d.
How often do you eat in Dunkin’ Donuts?
Once a month or less often
____
2 or 3 times a month
____
Once or twice a week
____
Three or more times per week
____
PART B
In this part, we would like to ask you some questions for classification purposes.
Q12.
Your Gender:
1. Male
2. Female
_____
_____
Q13.
Marital Status:
1. Currently Married
_____
2. Never Married
_____
3. Divorced/Separated/Widowed _____
Q14.
Family Size:
1. One
2. Two
3. Three
4. Four
5. Five or more
Q15. Your Age:
1. 18-24
2. 25-40
3. 41-60
4. 60+
Q16. Your Formal Education
1. Less than High School
2. High School Graduate
3. Some College
4. College Graduate
_____
_____
_____
_____
_____
_____
_____
_____
_____
_____
_____
_____
_____
VC5 - 4
Q17. What is Your Occupation?
____________________
Q18. What is the approximate combined annual income of your household before taxes?
1.
2.
3.
4.
5.
6.
$30,000 or less
$30,001 to 50,000
$50,001 to 75,000
$75,001 to 100,000
$100,001 to 150,000
$150,001 and over
_____
_____
_____
_____
_____
_____
Thank you for your participation.
____________________________________________________________________________
10.
Target population: Major coffee shop customers in Chicago in the current year
Sampling frame: List of coffee houses in Chicago
Sampling unit: Coffee houses in Chicago and then customers in the selected coffee
houses
Sampling technique: Quota sampling by age, gender, and income level
Sample size: 400
Execution: Visit the selected coffee houses and interview customers by quota.
VC5 - 5
Video Case 5.2
eGO: Electric Vehicles on the Go
1.
The company conducted exploratory research followed by descriptive research.
Exploratory research by way of pilot studies and informal qualitative research showed that
customers would like to test the cycle even though it was unavailable in many stores. A survey
of existing eGO owners revealed that the vehicle was used for commuting, recreation, business,
and errands.
2.
eGO can make use of a panel of owners and monitor their behavior over time to see how
the use of eGO changes over time.
3.
Students should search the Internet and the library’s online databases using key words
such as “electric vehicles,” “green marketing,” “environment friendly,” etc.
4.
Psychographic and lifestyle data such as those available from the Yankelovich Monitor
would be useful to eGO in projecting the future demand for its vehicles. Such data would
indicate whether and to what extent consumers are becoming more conscious of preserving the
environment and the size of the “green” segment.
5.
Depth interviews with women would be very useful. The one-on-one setting will permit
the probing of underlying emotions. This would be difficult to do in a focus group setting.
6.
The target population is the owners of eGO. The company will have the mailing
addresses of all owners because of product registration. Given the identification of the owners
with the product and the company, and the use of suitable, yet inexpensive, incentive should lead
to a good response rate to a mail survey. This would be the least expensive option for a company
concerned about profitability.
7.
Customer satisfaction survey questionnaire.
eGO SATISFACTION QUESTIONNAIRE
PART A
Q1. How often do you use your eGO?
a. One day a month or less often
b. 2 or 3 days a month
c. One or two days a week
d. Three or four days per week
e. More than four days per week
____
____
____
____
____
Q2. For what purpose do you use your eGO? Please check all that apply.
a. Recreation
_________
b. Commuting
_________
c. Business
_________
d. Errands
_________
e. Other (Please write in
_________
Q3. How satisfied are you with the performance of eGO?
Not at all
Satisfied
1
2
3
4
VC5 - 6
Very
Satisfied
5
Q4. How satisfied are you with the functionality of eGO?
Not at all
Satisfied
1
2
3
4
Very
Satisfied
5
Q5. How satisfied are you with the looks of eGO?
Not at all
Satisfied
1
2
3
4
Very
Satisfied
5
4
Very
Satisfied
5
4
Fully Met
My Expectations
5
Q6. How satisfied are you overall with eGO?
Not at all
Satisfied
1
2
3
Q7. To what extent has eGO met your expectations?
Not Met
My Expectations
1
2
3
PART B
In this part, we would like to ask you some questions for classification purposes.
Q8. Your Gender:
1. Male
2. Female
_____
_____
Q9. Marital Status:
1. Currently Married
_____
2. Never Married
_____
3. Divorced/Separated/Widowed _____
Q10. Family Size:
1. One
2. Two
3. Three
4. Four
5. Five or more
Q11. Your Age:
1. 18-24
2. 25-40
3. 41-60
4. 60+
_____
_____
_____
_____
_____
_____
_____
_____
_____
VC5 - 7
Q12. Your Formal Education
1. Less than High School
2. High School Graduate
3. Some College
4. College Graduate
_____
_____
_____
_____
Q13. What is Your Occupation?
____________________
Q14. What is the approximate combined annual income of your household before taxes?
1. $30,000 or less
_____
2. $30,001 to 50,000
_____
3. $50,001 to 75,000
_____
4. $75,001 to 100,000
_____
5. $100,001 to 150,000
_____
6. $150,001 and over
_____
Thank you for your participation.
____________________________________________________________________________
8.
Target population: owners of eGO in the current year.
Sampling frame: List of eGO owners available from registration records
Sampling unit: Names on the owners list
Sampling technique: Stratified sampling by duration of eGO ownership
Sample size: 400
Execution: Stratify the sample by duration of ownership. Use simple random sampling to
select the required number of owners in each stratum.
VC5 - 8
Video Case 5.3
Nextel’s Next Move: Expanding Its Customer Base
1.
Marketing research can help Nextel determine the factors that drive the loyalty of
business customers. It can help answer questions such as: How should the loyalty of business
customers to wireless service providers be defined? How does loyalty develop? What are the
factors that lead to loyalty? What marketing programs should be undertaken to enhance customer
loyalty?
2.
The management decision problem is: What must Nextel do to expand its customer
base?
3.
The marketing research problem is to understand how business customers select a
wireless service provider and determine their perceptions and preferences for Nextel and its
competitors. Specifically,
a.
What criteria do business customers use in selecting a wireless service provider?
b.
How do businesses evaluate Nextel and its competitors on the identified choice
criteria?
c.
Are there any wireless communication needs of businesses that are not being met
adequately?
d.
What are the factors that develop loyalty toward wireless service providers?
e.
What is best way to segment the business market for wireless services?
4.
The research design adopted should consist of an exploratory phase followed by a
descriptive phase. The purpose of the exploratory phase would be to understand the decision
making process of businesses for wireless services and determine the factors that lead to
customer satisfaction, retention and loyalty. This phase should include analysis of available
secondary data and depth interviews with businesses. The descriptive phase should involve a
cross-sectional survey of businesses to quantify the findings of exploratory research and to test
specific hypotheses.
5.
Firms such as D&B provide valuable information on businesses. This includes the type
of business (NAICS), the sales, number of employees, location, address, telephone, credit report,
etc. Such information can be useful in segmenting the marketing and understanding the wireless
needs of the different segments.
6.
Qualitative research can help Nextel to understand how loyalty develops and in
identifying the factors that drive loyalty of business customers toward wireless service providers.
Depth interviews with business customers would be very useful, as substantial probing would be
required.
7.
Sample control, i.e., the ability to identify and include the decision maker(s) in each
selected business in the survey, would be very important. This can be best done over the
telephone. The telephone survey also has the advantages of being fast, offering good control of
the field force, good response rate, and moderate cost.
8.
Ordinal Scale
Please rank order the following wireless service providers in terms of your preference for
doing business with them. Assign the rank of 1 to the most preferred provider and the
rank of 4 to the least preferred.
VC5 - 9
Wireless Service Provider
a. Cingular
b. Nextel
c. Verizon
d. T-Mobile
Rank
_____
_____
_____
_____
Interval Scale
Please rate the following wireless service providers in terms of your preference for doing
business with them using the seven-point scale, where 1 = no preference, and 7 = strong
preference.
No Preference
Strong Preference
a. Cingular 1
2
3
4
5
6
7
b. Nextel
1
2
3
4
5
6
7
c. Verizon
1
2
3
4
5
6
7
d. T-Mobile 1
2
3
4
5
6
7
Ratio Scale
How many dollars did you spend in the last fiscal year doing business with the following
wireless service providers?
Wireless Service Provider
Dollars Spent
a. Cingular
_____
b. Nextel
_____
c. Verizon
_____
d. T-Mobile
_____
9.
Likert scale:
Strongly Disagree Neutral Agree Strongly
Disagree
Agree
I like Nextel, overall
1
2
3
4
5
Nextel offers good value
1
2
3
4
5
Nextel has inferior technology
1
2
3
4
5
Nextel is competitive
1
2
3
4
5
Semantic differential scale: Nextel is:
Good overall -- -- -- -- -- -- -Good value
-- -- -- -- -- -- -Inferior technology -- -- -- -- -- -- -Competitive -- -- -- -- -- -- --
Stapel scale:
Nextel is:
+5
+4
+3
+5
+4
+3
+5
+4
+3
VC5 - 10
Not good overall
Not good value
Superior technology
Not competitive
+5
+4
+3
+2
+1
Good overall
-1
-2
-3
-4
-5
10.
+2
+1
Good value
-1
-2
-3
-4
-5
+2
+1
Inferior technology
-1
-2
-3
-4
-5
+2
+1
Competitive
-1
-2
-3
-4
-5
Target population: Businesses in the United States in the current year.
Sampling frame: List of telephone numbers of businesses
Sampling unit: telephone numbers
Sampling technique: Stratified random sampling. Strata based on NAIC and number of
employees.
Sample size: 500
Execution: Obtain a list of telephone numbers of businesses from D&B. Stratify the
businesses by NAIC and number of employees and then use systematic sampling to select
within each stratum.
11.
The sample size should be based on statistical consideration, as well as sample size used
in similar studies, cost, time, and research judgment. The sample size of 500 would be more
than adequate to yield percentage estimates that do not differ by more than plus or minus five
percent. It is the sample size that Nextel typically uses in its business surveys.
VC5 - 11
Video Case 5.4
The Snapple Story: (Un) Reliance on Marketing Research
1.
Students should search the Internet and the library’s online databases using key words such as
“iced tea,” “Snapple,” “Beverage,” etc.
2.
The research design adopted should consist of an exploratory phase followed by a descriptive
phase. The purpose of the exploratory phase would be to understand how consumers currently relate to
Snapple, how they perceive it as compared to other brands of iced tea and other beverages, and how
consumers select a brand of iced tea. This phase should include analysis of available secondary data,
focus groups and depth interviews with consumers. The descriptive phase should involve a crosssectional survey of consumers to quantify the findings of exploratory research and to test specific
hypotheses.
3.
To the extent the consumption of iced tea is influenced by age and other demographic
characteristics, secondary data related to demographic trends would be useful. Industry data related to
growth rates, market shares, and beverage industry trends would also be useful.
4.
Scanner (volume tracking and scanner panel) data would be useful in examining sales trends,
consumption patterns and loyalty factors. Purchase panel data, e.g., the beverage panel maintained by
NPD, can provide information on motivations, attitudes, and beliefs and their impact of beverage
purchases. Psychographic and lifestyle data can provide information on trends that will influence the
consumption of iced tea and other beverages.
5.
Both focus groups and depth interviews would be useful. Focus groups can generate new
insights and ideas, while depth interviews can uncover hidden motives, values, and beliefs. For
example, what is the personality of Snapple? Depth interviews would be very useful. The one-on-one
setting will permit the probing of underlying emotions, e.g., what emotional responses are elicited by
Snapple? This would be difficult to do in a focus group setting.
6.
Mall intercept interviews at representative locations could be used to determine the preference
that consumers have for bottled iced tea. Use of physical stimuli is a key consideration. Respondents
can taste various brands of iced tea and other beverages at these locations and then respond to the survey
questionnaire. Other advantages are complex questions can be asked, very good control of the data
collection environment, and very good response rate.
7.
The Posttest-Only Control Group Design is recommended. The control group will be exposed to
the current Snapple commercial and the test group to the new commercial. Post-exposure measure of
advertising effectiveness will be obtained for both groups. The simplicity of this design offers time,
cost, and sample size advantages. For these reasons, it is the most popular experimental design in
marketing research.
8.
A factorial design is recommended. There will be one factor with three treatment levels: current
commercial, new commercial 1, and new commercial 2. Respondents will be assigned randomly to the
three groups. Post-exposure measure of advertising effectiveness will be obtained for all the groups.
This design will allow a comparison of the three commercials in terms of advertising effectiveness.
9.
Ordinal Scale
Please rank order the following bottled iced tea brands in terms of your preference. Assign the rank of 1
to the most preferred and the rank of 3 to the least preferred brand.
VC5 - 12
Brand
a. Lipton
b. Snapple
c. Honest Tea
Rank
_____
_____
_____
Interval Scale
Please rate the following bottled iced tea brands in terms of your preference using the seven-point scale,
where 1 = no preference, and 7 = strong preference.
No Preference
Strong Preference
a. Lipton
1
2
3
4
5
6
7
b. Snapple
1
2
3
4
5
6
7
c. Honest Tea 1
2
3
4
5
6
7
Ratio Scale
How many dollars did you spend in the last two months on the following bottled iced tea brands?
Brand
Dollars Spent
a. Lipton
_____
b. Snapple
_____
c. Honest Tea
_____
10.
Likert scale:
I prefer Snapple iced tea
Strongly Disagree Neutral Agree Strongly
Disagree
Agree
1
2
3
4
5
Semantic differential scale: My preference for Snapple iced tea is:
Strong -- -- -- -- -- -- -Weak
Stapel scale:
My preference for Snapple iced tea is:
+5
+4
+3
+2
+1
Preference
-1
-2
-3
-4
-5
VC5 - 13
11.
A questionnaire for assessing consumer preferences for bottled iced tea.
BOTTLED ICED TEA QUESTIONNAIRE
PART A
Q1. How often do you drink bottled iced tea?
a. One a month or less often
____
b. 2 or 3 times a month
____
c. Once or twice a week
____
d. Three or four times per week
____
e. More than four times per week
____
Q3. Please rate the importance of the following factors in your selection of a brand of bottled iced tea.
Not at all
Very
Important
Important
a. Quality
1
2
3
4
5
b. Image
1
2
3
4
5
c. Variety
1
2
3
4
5
d. Price
1
2
3
4
5
e. Taste
1
2
3
4
5
Q4. Please rate your preference for the following brands of bottled iced tea.
Not at all
Very Much
Preferred
Preferred
a. Lipton
1
2
3
4
5
b. Snapple
1
2
3
4
5
c. Honest Tea
1
2
3
4
5
Q5. Please rate the following brands of bottled iced tea in terms of Quality.
Poor
Excellent
a. Lipton
1
2
3
4
5
b. Snapple
1
2
3
4
5
c. Honest Tea
1
2
3
4
5
Q6. Please rate the following brands of bottled iced tea in terms of Variety.
Poor
Excellent
a. Lipton
1
2
3
4
5
b. Snapple
1
2
3
4
5
c. Honest Tea
1
2
3
4
5
Q7. Please rate the following brands of bottled iced tea in terms of Image.
Poor
Excellent
a. Lipton
1
2
3
4
5
b. Snapple
1
2
3
4
5
c. Honest Tea
1
2
3
4
5
VC5 - 14
Q8. Please rate the following brands of bottled iced tea in terms of a value Price.
Poor
Excellent
a. Lipton
1
2
3
4
5
b. Snapple
1
2
3
4
5
c. Honest Tea
1
2
3
4
5
Q9. Please rate the brands of bottled iced tea in terms of Taste.
Poor
a. Lipton
1
2
3
4
b. Snapple
1
2
3
4
c. Honest Tea
1
2
3
4
Excellent
5
5
5
Q10. How often do you drink Snapple iced tea?
a.
Once a month or less often
____
b.
2 or 3 times a month
____
c.
Once or twice a week
____
d.
Three or four times per week
____
e. More than four times per week
____
PART B
In this part, we would like to ask you some questions for classification purposes.
Q11.
Your Gender:
1. Male
2. Female
_____
_____
Q12.
Marital Status:
1. Currently Married
_____
2. Never Married
_____
3. Divorced/Separated/Widowed _____
Q13.
Family Size:
1. One
2. Two
3. Three
4. Four
5. Five or more
Q14. Your Age:
1. 18-24
2. 25-40
3. 41-60
4. 60+
_____
_____
_____
_____
_____
_____
_____
_____
_____
VC5 - 15
Q15. Your Formal Education
1. Less than High School
2. High School Graduate
3. Some College
4. College Graduate
_____
_____
_____
_____
Q16. What is Your Occupation?
____________________
Q17. What is the approximate combined annual income of your household before taxes?
1.
2.
3.
4.
5.
6.
$30,000 or less
$30,001 to 50,000
$50,001 to 75,000
$75,001 to 100,000
$100,001 to 150,000
$150,001 and over
_____
_____
_____
_____
_____
_____
Thank you for your participation.
____________________________________________________________________________
12.
Target population: Mall shoppers in the United States in the current year
Sampling frame: List of Malls in the US
Sampling unit: Mall Shoppers
Sampling technique: Judgmental sampling
Sample size: 1000
Execution: Judgmentally select a set of shopping malls across the United States. Interview
shoppers using the mall-intercept method.
13.
This sample size of 1000 was selected based on qualitative considerations, such as the
importance of the decision, nature of the research, statistical analyses that would be required, resource
constraint, and the sample sizes used in similar studies Snapple had conducted in the past.
VC5 - 16
Video Case 5.5
Federated Says ‘I do’ to New Bridal Departments
1.
Federated Department Stores can use marketing research in several ways. Research can
help it to understand the attitudes and behaviors of the people as pertaining to department store
shopping. More specifically, what are consumers looking for in a department store? Marketing
research can also help the company develop appropriate positioning of its various stores,
determine the desirable product mix and quality, pricing and promotion strategies, advertising
campaigns, store locations, and a host of other marketing issues and strategies.
2.
Management Decision Problem: How can Federated Department Stores foster and build
the loyalty of its fans and continue to grow?
3.
The marketing research problem is to understand consumer behavior and loyalty for
Macy’s (Note that the problem has been narrowed to just one of the chains owned by Federated
Department Stores, i.e., Macy’s). More specifically,
a.
What factors are important in the consumers’ decision to patronize Macy’s?
b.
What factors result in repeat attendance and loyalty for Macy’s?
c.
What is the demographic and psychographic profile of consumers who are
loyal to Macy’s?
d.
What changes would the loyal fans like to see in Macy’s stores?
4.
An appropriate research design would be to conduct exploratory research first followed
by descriptive research. Exploratory research should include analysis of internal and external
secondary data, focus groups and depth interviews. The objective of exploratory research would
be to gain an understanding of how consumers select department stores for shopping and to
determine the factors that influence their patronage, repeat patronage, and loyalty patterns. The
exploratory phase would be followed by a descriptive phase consisting of a cross-sectional
survey. The objective of the descriptive phase would be to quantify the findings of the
exploratory phase and test specific hypotheses.
5. Federated can use Census 2000 data to analyze the changes in demographic profiles (e.g.,
age, income, race, marital status and gender) to see how these changes impact their loyal
customer base. They can also analyze the population growth rates of key segments and regions
to determine the impact of these factors on patronage and repeat patronage of Macy’s and other
Federated chains.
6. Syndicated survey data related to psychographics and lifestyles, such as the Yankelovich
Monitor, would be useful in discerning relevant trends that impact the patronage of department
stores. Advertising evaluation surveys and diary media panels such as the Nielsen TV Index can
guide Federated in the placement of its advertising. Scanner data pertaining to certain product
categories, such as consumer electronics, can also help in determining the appropriate product
mix.
7. One-on-one depth interviews enable us to understand consumers’ individual attachments and
associations to a department store. These are very personal and emotional experiences that can
best be uncovered in a one-on-one setting. Focus groups can help in identifying the choice
criteria consumers use in selecting a department store.
8. Mall-intercept personal interviews could be used because the interviewers can easily recruit
department store shoppers in the mall area, and it is more efficient for the respondent to come to
the interviewer than for the interviewer to go to the respondent. Moreover, this technique will
provide very good sample control and flexibility, and complex questions can be asked. Other
VC5 - 17
advantages include very good control of the data collection environment and very good response
rate. Should it be necessary to use any physical stimuli, mall-intercept interviews would be
desirable.
9.
Likert scale:
Strongly Disagree Neutral Agree Strongly
Disagree
Agree
I prefer to shop in Macy’s
1
2
3
4
5
Semantic differential scale: My preference for Macy’s is:
Strong -- -- -- -- -- -- -Weak
Stapel scale:
My preference for Macy’s is:
+5
+4
+3
+2
+1
Preference
-1
-2
-3
-4
-5
10.
See the questionnaire that follows.
DEPARTMENT STORE QUESTIONNAIRE
Q1. How often did you shop in department stores during the past year?
a. _____ 0-3 times
b. _____ 4-6 times
c. _____ 7-9 times
d. _____ 10-12 times
e. _____ More than 12 times
Q2. How much money did you spend in department stores during the past year?
a. _____ $0-$500
b. _____ $500-$1000
VC5 - 18
c. _____ $1000-$2000
d. _____ $2000-$3000
e. _____ More than $3000
Q3. Please rate the importance of the following factors in your selection of a department store.
a.
b.
c.
d.
e.
f.
g.
h.
i.
j.
Overall Value
Price
Variety
Reliability
Convenience
Customer Service
Advertising
Location
Promotion
Loyalty Program
Not at all
Important
1
1
1
1
1
1
1
1
1
1
2
2
2
2
2
2
2
2
2
2
3
3
3
3
3
3
3
3
3
3
4
4
4
4
4
4
4
4
4
4
Very
Important
5
5
5
5
5
5
5
5
5
5
Q4. Which of the following would strongly affect your shopping experience?
a.
b.
c.
d.
e.
f.
Poor Lighting
Bad Customer Service
Poor Selection
Unattractive Store
Store Temperature
Loud Music
No Effect
at All
1
1
1
1
1
1
2
2
2
2
2
2
3
3
3
3
3
3
4
4
4
4
4
4
Very Strong
Effect
5
5
5
5
5
5
Q5. Which of the following department stores have you shopped at during the last six months?
Please check all that apply.
a. _____ Macy’s
b. _____ Rich’s-Macy’s
c. _____ Lazarus-Macy’s
d. _____ Goldsmith’s-Macy’s
e. _____ Bloomingdale’s-Macy’s
f. _____ Burdines-Macy’s
g. _____ Bon-Macy’s
Q6. Please indicate your preference to shop in the following department stores using a seven
point scale, where 1 = Not at all Preferred, and 7 = Greatly Preferred.
Not at all
Greatly
Preferred
Preferred
a. Macy’s
1
2
3
4
5
6
7
b. Rich’s-Macy’s
1
2
3
4
5
6
7
VC5 - 19
c.
d.
e.
f.
g.
Lazarus-Macy’s
Goldsmith’s-Macy’s
Bloomingdale’s
Burdines-Macy’s
Bon-Macy’s
1
1
1
1
1
2
2
2
2
2
3
3
3
3
3
4
4
4
4
4
5
5
5
5
5
6
6
6
6
6
7
7
7
7
7
Q7. How many times have you shopped at Macy’s during the past year?
a. _____ 0-3 times
b. _____ 4-6 times
c. _____ 7-9 times
d. _____ 10-12 times
e. _____ More than 12 times
Q8. Please indicate your evaluation of Macy’s on the following factors using a seven- point
scale where 1 = Very Poor, and 7 = Very Good.
a.
b.
c.
d.
e.
f.
g.
h.
i.
j.
Overall Value
Price
Variety
Reliability
Convenience
Customer Service
Advertising
Location
Promotion
Loyalty Program
Very Poor
1
1
1
1
1
1
1
1
1
1
2
2
2
2
2
2
2
2
2
2
3
3
3
3
3
3
3
3
3
3
4
4
4
4
4
4
4
4
4
4
Very Good
5
5
5
5
5
5
5
5
5
5
PART B
In this part, we would like to ask you some questions for classification purposes.
Q9.
Your Gender:
1. Male
2. Female
_____
_____
Q10.
Marital Status:
1. Married
_____
2. Never Married
_____
3. Divorced/Separated/Widowed _____
Q11.
Family Size:
1. One
2. Two
3. Three
_____
_____
_____
VC5 - 20
4. Four
5. Five or more
Q12. Your Age:
1. 18-24
2. 25-40
3. 41-60
4. 60+
Q13. Your Formal Education:
1. Less than High School
2. High School Graduate
3. Some College
4. College Graduate
_____
_____
_____
_____
_____
_____
_____
_____
_____
_____
Q14. What is Your Occupation?
____________________
Q15. What is the approximate combined annual income of your household before taxes?
1. $30,000 or less
_____
2. $30,001 to 50,000
_____
3. $50,001 to 75,000
_____
4. $75,001 to 100,000
_____
5. $100,001 to 150,000
_____
6. $150,001 and over
_____
Thank you for your participation.
____________________________________________________________________________
11.
Convenience sampling could be used for mall-intercept interviews.
Target population: Mall shoppers in the United States in the current year
Sampling frame: Malls in the United States
Sampling unit: Malls and then shoppers
Sampling technique: Mall-intercept interviews (Convenience sampling)
Sample size: 500
Execution: Interview shoppers in the selected malls by intercepting them in key locations
in the mall. Note that imposing quotas is not necessary since the profile of the mall
shoppers closely matches that of target population.
12.
This sample size of 500 was selected based on qualitative considerations, such as the importance
of the decision, nature of the research, statistical analyses that would be required, resource constraint,
and the sample sizes used in similar studies Federated had conducted in the past.
13.
Because this is a personal interview, physical appearance and manners are important.
The individuals should have a pleasant appearance and appear and act professionally, thus they
should have at least a high school education. Experienced personal interviewers are needed
VC5 - 21
since they will tend to be more comfortable interviewing in the mall. Interviewers will need to
be personable in order to promote a relaxed atmosphere for the interview. They should have
effective speaking, listening and writing skills to successfully capture and record the information.
Training is needed in the following areas:
*
Making the initial contact - The initial contact is important to gain the
confidentiality and trust of respondents. Practice in approaching people should be
a part of the training, including an opening line.
*
Asking Questions - As always, field workers must ask the questions exactly as
worded in order to prevent interviewer bias. Field workers should be instructed to
abide by the guidelines listed in the text.
*
Probing - When respondents do not sufficiently answer the question, it is
necessary to motivate them to respond or clarify their answers. Training should
cover different techniques of probing so that field workers are comfortable with at
least one technique.
*
Recording answers - Field workers should be familiar with the survey form and
know how to mark responses on the form. The entire form should be reviewed in
detail. Recording answers to unstructured questions should be reviewed as well.
The guidelines listed in the text should be followed.
*
Terminating the interview - Field workers should be instructed to close each
interview in a polite and gracious manner after all the information has been
obtained.
14.
a.
Correlation between willingness to attend and each of five independent variables
Dependent variable: Willingness to shop in a department store
Independent variable: quality of merchandise, variety of merchandise, competitive
prices, in-store service, and convenience of location.
b.
Multiple regression of willingness to shop on all of five independent variables
Dependent variable: Willingness to shop
Independent variables: quality of merchandise, variety of merchandise,
competitive prices, in-store service, and convenience of location
c.
Hypothesis testing using t-test for paired samples (paired variables: evaluation of
Macy’s on quality of merchandise and evaluation of Macy’s on competitive
prices)
d.
Hypothesis testing using t-test for paired samples (paired variables: evaluation of
Macy’s on in-store service and evaluation of Nordstrom on in-store service)
e.
Hypothesis testing using t-test for two independent samples (Macy’s shoppers and
nonshoppers). Five t-tests will be conducted, one for each of the five independent
variables.
f.
Hypothesis testing using t-test for two independent samples (men and women)
with willing to shop at Macy’s as the dependent variable.
g.
ANOVA
Dependent variable: willingness to shop at Macy’s
Independent variable: age classified into four groups: less than 25, 26 to 45, 46 to
65, and 66 or older.
h.
Cross-Tabulation of willingness to shop at Nordstrom (unwilling, neutral, and
willing) with age (less than 25, 26 to 45, 46 to 65, and 66 or older).
VC5 - 22
i.
i.
j.
k.
ANOVA
Dependent variable: Willingness to shop at Macy’s
ndependent variable: Marital status (never married, currently married, and others)
Cross-Tabulation of willingness to shop at Nordstrom (unwilling, neutral, and
willing) with marital status (never married, currently married, and others).
Since 8 percent does not represent a large number of cases, throwing out these
respondents (i.e., casewise deletion) is an option. Pairwise deletion and substation
of the missing values with the variable mean should also be tried.
15.
The format suggested in Chapter 19 would be appropriate.
16.
NASCAR needs to address differences in the lifestyle/pastime and shopping behavior in
their marketing research. They also need to consider other socio-cultural factors such as family
dynamics and research methodology in Germany. In addition, economic/infrastructure factors,
marketing environment, government environment, legal environment, and information and
technological environment should be considered as well.
17.
With regard to the general public, ethical concerns revolve primarily around the methods
of generating and reporting research results. It is the joint responsibility of the researcher and the
client to ensure that the research findings are being disseminated accurately. In particular, care
should be taken by both the market researcher and the client to avoid incomplete reporting,
misleading reporting, and biased research.
It is the marketing researcher’s responsibility to protect the respondents from unethical
research practices. Two issues deserve special attention: conducting a survey as a guise to sell
products, and the invasion of the privacy of the respondent.
Given the complexity involved, it is not surprising that the ethical issues surrounding the
researcher-client relationship are somewhat numerous. Areas that deserve special attention from
an ethical standpoint are: abuse of position arising from specialized knowledge, unnecessary
research, an unqualified researcher, disclosure of identity, treating data as nonconfidential, and
misleading presentation of data.
The researcher (or the research firm) has the right to be treated ethically as well. Ethical
treatment by clients involves several issues: improper solicitation of proposals, disclosure of
proprietary techniques, and misrepresentation of findings.
VC5 - 23
Video Case 5.6
Motorola: Projecting the Moto Lifestyle
1.
Motorola can use marketing research in several ways. Research can help it to understand
the attitudes and behaviors of the people as pertaining to cellular phone usage. More
specifically, what are consumers looking for in a cellular phone handset? Marketing research
can also help the company develop appropriate positioning of its various handset models,
determine the desirable product mix and quality, pricing and promotion strategies, advertising
campaigns, and a host of other marketing issues and strategies.
2.
Management Decision Problem: What can Motorola do to build its market share and
continue to grow?
3.
The marketing research problem is to understand consumer behavior, preferences and
purchase of cellular handsets. More specifically,
a.
What factors are important in the consumers’ decision to buy a cellular handset?
b.
What factors result in the selection of a particular cellular handset model?
c.
What are consumers’ perceptions of Moto?
d.
What is the demographic and psychographic profile of consumers who are loyal to
the Motorola brand?
4.
In order to obtain the required information, three types of online searches can be utilized.
First, key words should be entered in standard search engines like www.google.com and
www.yahoo.com. The keywords should be descriptive of the type of information and attempt to
restrict the number of responses. Some of the keywords that could be used are: “Cell phones and
market share”, “Motorola and market share” and “Nokia and market share,” etc.
The second type of search that can be used is a database search. Through the library Web
site, students can search for articles in magazines, papers and periodicals like New York Times
and News Week concerning market share in the cellular handset industry. In addition, LexisNexis Academic Universe business and industry news database can be used to search for market
share statistics.
Finally, the Web sites of major handset manufacturers should be visited looking for press
releases that may contain the information needed.
5.
Syndicated survey data related to psychographics and lifestyles, such as the Yankelovich
Monitor, would be useful in discerning relevant trends that impact cell phone usage and the
purchase of cellular handsets. Advertising evaluation surveys and diary media panels such as the
Nielsen TV Index can guide Motorola in the placement of its advertising. Scanner data
pertaining to certain product categories, such as cellular handsets, can also help in determining
the appropriate product mix.
6.
One-on-one depth interviews enable us to understand consumers’ individual attachments
and associations to a cellular handset. These are very personal and emotional experiences that
can best be uncovered in a one-on-one setting. Focus groups can help in identifying the choice
criteria consumers use in selecting a cellular handset.
7.
Mall-intercept personal interviews could be used because the interviewers can easily
recruit cellular handset users and nonusers in the mall area, and it is more efficient for the
respondent to come to the interviewer than for the interviewer to go to the respondent.
Moreover, this technique will provide very good sample control and flexibility, and complex
questions can be asked. Other advantages include very good control of the data collection
VC5 - 24
environment, very good response rate. Since it was necessary to show respondents handset
models, mall-intercept interviews were desirable.
8.
Experiments can help Motorola to identify preferred features and the levels at which
specific features should be offered in the cellular handsets. Experiments can also help determine
preferred pricing and advertising levels. These factors can be systematically varied and
consumers’ response determined.
9.
See the questionnaire that follows.
CELLULAR HANDSET QUESTIONNAIRE
Q1. Do you own or personally use a cellular phone handset?
a. Yes ____
b. No ____
(IF NO, THANK THE RESPONDENT AND TERMINATE)
Q2. Since how long have you had your present cell phone handset?
_____ months and ____ years
Q3. Please rate the importance of the following factors in your selection of a cell phone handset.
Not at all
Very
Important
Important
a. Brand name
1
2
3
4
5
b. Appearance and Style
1
2
3
4
5
c. Features
1
2
3
4
5
d. My kind of a phone
1
2
3
4
5
Q4. Which of the following brands of cell phone handsets have you ever used? Please check all
that apply.
a. Nokia
b. Motorola
c. Samsung
d. Sony/Ericsson
Q5. Please indicate your preference for the following brands of cell phone handsets using a
seven point scale, where 1 = Not at all Preferred, and 7 = Greatly Preferred.
Not at all
Greatly
Preferred
Preferred
a. Nokia
1
2
3
4
5
6
7
b. Motorola
1
2
3
4
5
6
7
c. Samsung
1
2
3
4
5
6
7
d. Sony/Ericsson
1
2
3
4
5
6
7
VC5 - 25
Q6. Please rate the following cell phone handsets in terms of brand name.
Poor
a. Nokia
1
2
3
4
5
b. Motorola
1
2
3
4
5
c. Samsung
1
2
3
4
5
d. Sony/Ericsson
1
2
3
4
5
6
6
6
6
Excellent
7
7
7
7
Q7. Please rate the following brands of cell phone handsets in terms of appearance and style.
Poor
Excellent
a. Nokia
1
2
3
4
5
6
7
b. Motorola
1
2
3
4
5
6
7
c. Samsung
1
2
3
4
5
6
7
d. Sony/Ericsson
1
2
3
4
5
6
7
Q8. Please rate the following brands of cell phone handsets in terms of features.
Poor
a. Nokia
1
2
3
4
5
6
b. Motorola
1
2
3
4
5
6
c. Samsung
1
2
3
4
5
6
d. Sony/Ericsson
1
2
3
4
5
6
Excellent
7
7
7
7
Q9. Please rate the following brands of cell phone handsets in terms of a “my kind of a phone”.
Poor
Excellent
a. Nokia
1
2
3
4
5
6
7
b. Motorola
1
2
3
4
5
6
7
c. Samsung
1
2
3
4
5
6
7
d. Sony/Ericsson
1
2
3
4
5
6
7
PART B
In this part, we would like to ask you some questions for classification purposes.
Q10.
Q11.
Your Gender:
1. Male
2. Female
_____
_____
Marital Status:
1. Married
_____
2. Never Married
_____
3. Divorced/Separated/Widowed _____
VC5 - 26
Q12.
Family Size:
1. One
2. Two
3. Three
4. Four
5. Five or more
Q13. Your Age:
1. 18-24
2. 25-40
3. 41-60
4. 60+
Q14. Your Formal Education:
1. Less than High School
2. High School Graduate
3. Some College
4. College Graduate
_____
_____
_____
_____
_____
_____
_____
_____
_____
_____
_____
_____
_____
Q15. What is Your Occupation?
____________________
Q16. What is the approximate combined annual income of your household before taxes?
1. $30,000 or less
_____
2. $30,001 to 50,000
_____
3. $50,001 to 75,000
_____
4. $75,001 to 100,000
_____
5. $100,001 to 150,000
_____
6. $150,001 and over
_____
Thank you for your participation.
____________________________________________________________________________
10.
Convenience sampling could be used for mall-intercept interviews
Target population: Mall shoppers in the United States in the current year
Sampling frame: Malls in the United States
Sampling unit: Malls and then shoppers
Sampling technique: Mall-intercept interviews (Convenience sampling)
Sample size: 500
Execution: Interview shoppers in the selected malls by intercepting them in key locations
in the mall. Quotas may be imposed based on age and cell phone usage.
11.
a.
Correlation between preference rating and each of four independent variables.
Dependent variable: preference rating.
Independent variable: brand name, appearance and style, features, and “my kind
of a phone”. A positive relationship is expected.
VC5 - 27
b.
Multiple regression between preference rating and all four independent variables.
dependent variable: preference rating
four independent variables: brand name, appearance and style, features, and “my
kind of a phone”.
c.
Hypothesis testing using t-test for paired samples (paired variables: appearance
and style, and features).
d.
Hypothesis testing using t-test for two independent samples (users and nonusers
of Motorola).
e.
ANOVA
Dependent variable: Preference for Motorola
Independent variable: Product usage (heavy, medium, and light users).
12.
Cross-Tabulation (between preference rating for Yahoo! (disliked, neutral, liked) and
each of the six independent variables (poor, neutral, and good): brand name, appearance and
style, features, and “my kind of a phone”. Four Cross-Tabulations should be run.
13.
ANOVA
Dependent variables: Preference for Motorola
Independent variables: Each of the four categorical independent variables (poor, neutral,
and good): brand name, appearance and style, features, and “my kind of a phone”. Four
ANOVAs should be run.
14.
Pie Charts can be used to present percentage estimates. Histograms and bar charts, since
frequency counts, will be obtained for most of interval scaled variables. Line charts will not be
used, since the data are cross-sectional and pertain to a single point in time.
15.
Motorola needs to address differences in the lifestyle/pastime, cell phone usage, and
shopping behavior in their marketing research. They also need to consider other socio-cultural
factors, such as family dynamics and research methodology in Asia. In addition,
economic/infrastructure factors, marketing environment, government environment, legal
environment, and information and technological environment should be considered as well.
a.
With regard to the general public, ethical concerns revolve primarily around the
methods of generating and reporting research results. It is the joint responsibility of the
researcher and the client to ensure that the research findings are being disseminated
accurately. In particular, care should be taken by both the market researcher and the
client to avoid incomplete reporting, misleading reporting, and biased research.
It is the marketing researcher’s responsibility to protect the respondents from
unethical research practices. Two issues deserve special attention: conducting a survey
as a guise to sell products, and the invasion of the privacy of the respondent.
Given the complexity involved, it is not surprising that the ethical issues
surrounding the researcher-client relationship are somewhat numerous. Areas that
deserve special attention from an ethical standpoint are: abuse of position arising from
specialized knowledge, unnecessary research, an unqualified researcher, disclosure of
identity, treating data as nonconfidential, and misleading presentation of data.
The researcher (or the research firm) has the right to be treated ethically as well.
Ethical treatment by clients involves several issues: improper solicitation of proposals,
disclosure of proprietary techniques, and misrepresentation of findings.
VC5 - 28