Chapter 8

Marketing: Turning Marketing Information into Action
 

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AFTER READING THIS CHAPTER
YOU SHOULD BE ABLE TO:
  • •Identify a five-step marketing research approach leading to marketing actions.
•
  • •Describe how secondary and primary data are used in marketing, including the uses of questionnaires, observations, experiments, and panels.
 
  • •Understand how information technology enables information systems to be used to link massive amounts of marketing information to meaningful marketing actions.
  • •Recognize alternative methods to forecast sales and use the lost-horse and linear trend extrapolation methods to
    make a simple forecast.

 

TURNING MARKETING INFORMATION INTO ACTION
TEST SCREENINGS:  LISTENING
TO CONSUMERS TO REDUCE MOVIE RISKS.
  • •What’s in a Movie Name?
  • •How Filmmakers Try to Reduce Risk
 

 

FIGURE 8-1  Marketing research questions asked in test screenings of movies . . .

THE ROLE OF
MARKETING RESEARCH
  • •A Means of Reducing Risk and Uncertainty
  • •Why Good Marketing Research is Difficult
 

 

Marketing Research
Marketing research is the process of defining a marketing problem and opportunity, systematically collecting and analyzing information, and recommending actions to improve an organization’s marketing activities.

 

 

THE ROLE OF
MARKETING RESEARCH
§1.  Define the problem
§2.  Develop the research plan
§3.  Collect relevant information
§4.  Develop findings
§5.  Take marketing actions
 

 

 

Decision
A decision is a conscious choice from among two or more alternatives.

 

 

FIGURE 8-2  Five-step marketing research approach leading to marketing actions

Concept Check
1.  What is marketing research?
A:  The process of defining a marketing problem and opportunity, systematically collecting and analyzing information, and recommending actions to improve an organization’s marketing activities.
 

2.  What are the five steps marketing research uses to help lead to marketing?

 
A:  (1) Define the problem, (2) Develop the research plan, (3) Collect relevant information, (4) Develop findings, and (5) Take marketing actions.
 

 

 

STEP 1:  DEFINE THE PROBLEM
  • •Identify Possible Marketing Actions
 

 

 

Objectives
Objectives are specific, measurable goals the decision maker seeks to achieve in solving a problem.

 

 

Measures of Success
Measures of success are criteria or standards used in evaluating proposed solutions to the problem.
 

 

STEP 2:  DEVELOP THE RESEARCH PLAN
  • •Identify Data needed for Marketing Actions
  • •Determine How to Collect Data
•       Concepts
•       Methods
 
 

 

Constraints
The constraints in a decision are the restrictions placed on potential solutions by the nature and importance of the problem.
 
 

 

Probability Sampling
Probability sampling involves using precise rules to select the sample such that each element of the population has a specific known chance of being selected.
 

 

Nonprobability Sampling
In nonprobability sampling researchers do not know the chances of selecting a particular element.
 
 

 

Statistical Inference
The method of statistical inference involves drawing conclusions about a population from a sample.
 
 

 

Concept Check
1.  How do research objectives relate to marketing actions?
 
A:  Research objectives are specific, measurable goals the decision maker seeks to achieve in solving a problem.  Once the problem is well defined, a marketing researcher can develop the research plans, collect relevant information, develop findings, and take marketing actions to resolve these problems.
 
2.  What does constraints mean?
A: Constraints are restrictions placed on potential solutions by the nature and importance of the problem.  Common constraints are time, money, and human limitations.
 

3.  What is the difference between concepts and methods?

 
A:  Concepts are conjectures or ideas about the relationship of two or more factors that may be potential solutions to a marketing problem, whereas methods are approaches that can be used to collect data to solve all or part of a problem.
 
 

 

STEP 3:  COLLECT
RELEVANT INFORMATION

FIGURE 8-3  Types of Marketing Information

STEP 3:  COLLECT
RELEVANT INFORMATION
•Secondary Data
  • •Internal Secondary Data
  • •External Secondary Data
  • •Advantages and Disadvantages
    of Secondary Data
•Primary Data
  • •Panels and Experiments
  • •Advantages and Disadvantages
    of Primary Data
 

 

Secondary Data
Secondary data are facts and figures that have already been collected before the project at hand. Data are the facts and figures pertinent to the problem.
 
 

 

Primary Data
Primary data are facts and figures that are newly collected for the project at hand. Data are the facts and figures pertinent to the problem.

 

 

Observational Data
Facts and figures obtained by watching, either mechanically or in person, how people actually behave are observational data. 

 

 

Questionnaire Data
Questionnaire data are facts and figures obtained by asking people about their attitudes, awareness, intentions, and behaviors.
 

 

 

 

Concept Check
1.  What are methods?
 
A: Methods are the approaches that can be used to collect data to solve all or part of a problem.
 

2.  What is the difference between secondary and primary data?

 
A:  Secondary data are facts and figures that have already been recorded before the project at hand, whereas primary data are facts and figures that are newly collected for the project.
 

3.  What are some advantages and disadvantages of secondary data?

 
A:  Advantages include time savings, low cost, and sometimes a greater level of detail.  Disadvantages include possibly being out of date, inappropriate definitions and categories, and not being specific enough for the project. 

 

 

 

 

 

 

FIGURE 8-4  Nielsen ratings of the top 10 national television programs from Jan 28, 2002 to Feb 3, 2002

FIGURE 8-5  Nielsen//NetRatings of the top 10 Internet Websites in January, 2002

FIGURE 8-6  Typical problems in wording questions

FIGURE 8-7a  Sample questions from Wendy’s survey

FIGURE 8-7b  Sample questions
from Wendy’s survey

Concept Check
1.  A mail questionnaire asks:  “Do you eat pizza?”  What kind of question is this?
A:  Assuming the answer is either “yes” or “no”, it is a dichotomous question.
 
2.  Which survey provides the greatest flexibility for asking probing questions:  mail, telephone, or personal interview?
 
A:  Personal interview surveys.
 
3.  What is the difference between a panel and an experiment?
 
A:  A  panel is a sample of consumers or stores from which researchers take a series of measurements.  An experiment involves obtaining data by manipulating factors under tightly controlled conditions to test cause and effect.  Specifically, will changing one of the independent variables, (a cause), change the behavior of the dependent variable that is studied (the effect)?
 
 

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