The Research Process
Outlets–the Place Decision
2
Section 6.1 – The Research
Process - Objectives
Define market
research
Explain how businesses
use market research
Identify the steps used
in the research process
3
Section 6.1 – The Research
Process
Research and Market Concept
Business must know their customers in order to be successful
Small business owners get to know their customers by reviewing sales
data and by talking to their customers. This process is called Market
Research
–
–
Market Research is the process of systematically collecting, recording,
analyzing, and presenting data related to marketing goods and services
Information generated by Market Research can benefit: product
development, pricing, promotional activities, distribution, and customer
satisfaction
Large companies use surveys and focus groups as part of their market
research in order to monitor the degree of customer satisfaction
4
Section 6.1 – The Research
Process
Steps in Research Process
1.
2.
3.
4.
5.
The five steps in the research
process are:
Identify the problem
Conduct secondary research
Select and design primary
research
Collect data
Report and analyze data
1.
• Identify the problem
2.
• Conduct secondary research
3.
• Select and design primary
research
4.
• Collect data
5.
• Report and analyze data
5
Section 6.1 – The Research
Process
Steps in Research Process
1. Identify the Problem
– Ask a question that
research can help answer
– Examples:
• How can you improve
your product and make it
stand out in the market?
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Section 6.1 – The Research
Process
Steps in Research Process
2. Conduct Secondary Research
– Secondary Research is published data that has been collected for some
other purpose
– Data are recorded facts and figures that are organized and analyzed in
some way
– Can include:
• Internal data from a company (sales report, merchandise returns)
• External data from sources such as books, magazines, the Internet or
companies that specialize in market research
– Some companies sell research reports based on product category
• American Sports Data, Inc. A.C. Nielsen
– U.S. Census can provide demographic information
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Section 6.1 – The Research
Process
Steps in Research Process
2. Conduct Secondary Research – cont.
– Secondary research is conducted before
primary research because secondary
data may actually answer all or part of a
research problem or question
– Research may provide background
information for the study
– Can lead to the type of questions needed
for Primary research
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Section 6.1 – The Research
Process
Steps in Research Process
3. Select and Design Primary Research
– Primary research is original research conducted for a specific
marketing situation
– Secondary research is not sufficient to answer the research
question
– Type of research depends on the objectives and subjects (members
of a population) who are to be studied
– The more specific the characteristics of the population, the easier it
is to select the primary research method
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Section 6.1 – The Research
Process
Steps in Research Process
3. Select and Design Primary Research – cont.
– Types of Research Methods:
• Experiment
• Observation
• Survey
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Section 6.1 – The Research
Process
Steps in Research Process
3. Select and Design Primary Research – cont.
– Experiment:
• Experimental design of research broken into independent and
dependent variables
• Independent Variable is the variable that is being manipulated, or
changed
• Dependent variable is the one that is affected by the change
made by the independent variable
– EX. Changing ticket prices to a baseball game (independent
variable) to see if sales increase (dependent variable)
• Experiments let you draw conclusions from the interaction of
variables
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Section 6.1 – The Research
Process
Steps in Research Process
3. Select and Design Primary Research – cont.
– Observation:
• Observation method is the watching of actual behavior and
recording it
• Includes some method of recording, which can include text,
audio, and/or video
• Allows freedom for interpretation
• Can not only record actions, but can also record their comments
and body language
• Because information is recorded, researchers can reexamine the
observations later to help answer the research question
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Section 6.1 – The Research
Process
Steps in Research Process
3. Select and Design Primary Research – cont.
– Survey:
• Asking questions of participants in a
study
• Can be basic or it could be specific to a
particular product or service
• Can be for a focus group/panel or part
of written/verbal questionnaire
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Section 6.1 – The Research
Process
Steps in Research Process
3.Select and Design Primary Research – cont.
Focus group
– Group or panel involves six to ten
participants who are brought
together to discuss their feelings
– Moderator asks questions and
seeks responses from participants
– Considered qualitative research:
data collected is subjective, so no
statistical analysis can be done
– Data collected may become basis
for later questionnaire
Questionnaire
– Written surveys that can be
administered in person, by
telephone, fax, mail, or online
– Data can be easily quantitative
– Quantitative research allows
for statistical analysis which
includes things such as
correlations and numerical
percentages
– Can compare data with
demographic data
Section 6.1 – The Research
Process
Steps in Research Process
4. Collect Data
– Data collection method depends on the survey tool and the
characteristics and needs of the population
– Examples: Asking every 10th person entering baseball game to take survey;
Conducting Mall intercept
• Many participants in various surveys do not expect to go out of
their way to complete the survey
• Many survey participants are compensated for their participation
• Each research method had advantages and disadvantages related
to time, cost, and accuracy of data collection
– Mail and fax questionnaires return rate
– Online duplication of responses by same participant
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Section 6.1 – The Research
Process
Steps in Research Process
4. Collect Data – cont.
– Census
• Population or subjects of the
study have to be determined
early in research planning
• If population that is being
surveyed is a small group, then a
census can be taken
• Census is a study that counts
everyone in the research
population
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Section 6.1 – The Research
Process
Steps in Research Process
4.Collect Data – cont.
Sample
– Used when a census is not
– You must also decide how to locate
possible to collect data
and select those people who are part
of your study’s population
– Sample is a number of people
who are representative of a
– Use Random Sample if you have a
study’s population
complete list of all members of
study’s population
– Focus groups can be used to
determine type of people that – If you do not have all of the members
should be sampled
of a study’s population, then you
need to use a Non-Random Sample
– Size of sample should be large
• Through Mall Intercept, ask qualifying
enough to represent the
questions first to determine if
population under study
candidate represents the population
you wish to study
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Section 6.1 – The Research
Process
Steps in Research Process
4. Collect Data – cont.
– Data Mining
• Process of collecting data from one
or more existing database and
looking for relationships among the
data
– Computer software is used to do
statistical analysis
• Used to find out and predict:
– Market Segmentation; Customer or client
profiling; Fraud detection; Success or
failure of promotion; Credit risk or
acceptability
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Section 6.1 – The Research
Process
Steps in Research Process
5. Report and Analyze Data
– In order for data collected to be useful, it needs to be
reported and analyzed
– It is important to be very specific and clear in report language
– Reporting Qualitative-Research Data (Subjective)
• Researched data is reported in Paragraph format
• No conclusions can be drawn, only interpretations drawn from
facts
• This data provides insight into a problem which researchers must
be able to detect if they hope to find answers to the research
question
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Section 6.1 – The Research
Process
Steps in Research Process
4. Report and Analyze Data – cont.
– Reporting Quanitative-Research Data
(Objective)
• Researched data can be reported in graph and
charts, with analysis, or interpretation,
written in accompanying paragraphs of text
• Link report information to the objective of the
study
• Since people are not consistent from day to
day, you can suggest or infer something, but
you cannot conclude anything about any given
data
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Section 6.2 – Outlets – The
Place Decision – Objectives
Explain how businesses
make the place
decision as part of the
marketing mix
Discuss direct and
indirect channels of
distribution
21
Section 6.2 – Outlets – The
Place Decision
Place of Decision
Price decisions involve how you get your product to the
customer
All four marketing-mix decisions must focus on the target
market
Determining the type of customer you have is the first
consideration about a product’s distribution
The intended use of the product determines the type of
customer:
–
–
Business Customers
Ultimate Customers
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Section 6.2 – Outlets – The
Place Decision
Place Decision
Business Customers
–
–
Organizational buyers
Purchase products for use in the operation of a business
Ultimate Consumers
–
–
Customers
Buy products for their own personal use
Reaching each type of customer requires a different channel of
distribution
–
Needs and shopping habits are completely different
How and where customers shop are important factors in deciding on a
channel of distribution
Section 6.2 – Outlets – The
Place Decision
Channels of Distrubition
The path a product takes from the producer or manufacturer to the
consumer
Direct Channels
– A Direct Channel of distribution is the path a product takes without the
help of any intermediaries between the producers and consumer
– Certain products require direct contact with customers for a sale to take
place
Distributing Services
– Services are distributed directly to customers
• EX. Personal trainers work directly with his or her clients
• Ex. Fantasy sports leagues provided by sports sites
Section 6.2 – Outlets – The
Place Decision
Channels of Distrubition
Direct Marketing
– Marketing activities to sell products directly to customers through the use
of a customer database
– Solicit business over telephone, fax, mail, or e-mail
Telephone Sales
• Selling activities in which a live person or a recording calls a number in
the database to inform the potential customer about a product or
service
• Businesses use telemarketing to get word out about a new product
offering
• Telemarketing can produce immediate sales
Section 6.2 – Outlets – The
Place Decision
Channels of Distrubition
Direct Marketing – cont.
Print
• Traditional way to apply direct-marketing techniques
• Can also be combined with other media for more marketing exposure
• Catalog companies can publish specialized versions of their catalogs
based on customers’ buying habits
• Advertising in magazines and on television can generate direct sales
through use of 800 number
Television
• Infomercials are 30-minute television advertisements of
an educational nature
• Products and services are available for purchase 24 hours
a day on TV networks like HSN
Section 6.2 – Outlets – The
Place Decision
Channels of Distrubition
Direct Marketing – cont.
E-mail and the Internet
• Benefits:
– Information can be obtained and purchases can be made without
having to leave home
– Purchases only need access to a computer with an internet
connection to make purchases anywhere around the world
• Customers are more likely to respond to e-mail solicitation if
they have requested this information themselves
• Spam, or unsolicited e-mail is one of the biggest concerns Web
users have today
Section 6.2 – Outlets – The
Place Decision
Channels of Distrubition
Indirect Channels
• The path that a product takes using intermediaries, or people or
services in the middle of a transaction, between the producer
and consumer
• Intermediaries include:
– Agents
– Wholesalers
– Retailers
Section 6.2 – Outlets – The
Place Decision
Channels of Distrubition
Indirect Channels
Agents
• Bring buyers and sellers together for a fee
• Can operate from multiple locations and manage sales
electronically
• Agents do not take ownership of the goods they sell
Wholesalers
• Resellers who buy goods, store them, and sell them in smaller
quantities to retailers or sports organizations
• Function helps reduce the number of sales contacts that a
manufacturer has to make in order to sell products
Section 6.2 – Outlets – The
Place Decision
Channels of Distrubition
Indirect Channels
Retailer
• Sell their goods directly to
the customer for their
personal use
• Purchase their products
form wholesalers and
manufacturers
Section 6.2 – Outlets – The
Place Decision
Channels of Distrubition
Multiple Channels
• The use of more than one type
of distribution channel to reach
customers
– Ex. Nike – Sells products
from own retail stores &
Website, but also to
retailers, who in turn sells
products to customers
• Use of multiple channels
increases product exposure and
provides an opportunity to
reach different parts of
consumer market
Trying It Out
• Businesses will start with one
distribution channel and
experiment with others until the
find the mix that lets their
business grow
• Businesses must research and
identify what to produce, for
whom, and what method of
delivery will get the product out
into the marketplace