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Defining the Marketing Defining the Marketing Research Problem and Research Problem and

Developing an ApproachDeveloping an Approach

Bambang WihartoBambang Wiharto

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IntroductionIntroduction

Defining the problemDefining the problem is the most important step, because only when a problem has been clearlyclearly and accuratelyaccurately identified can a research project be conducted properlyproperly.

Defining the marketing research problemmarketing research problem setssets the course of the entire project.

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Importance of Defining the Importance of Defining the ProblemProblem

• Problem definitionProblem definition involves statingstating the general marketing research problemmarketing research problem and identifyingidentifying its specific components.

• Only when marketing research problem has been clearly definedclearly defined can research be designed and conducted properly.

• InadequateInadequate problem definition is a leadingleading cause of failure of marketing research project.

• Better communication and moremore involvement in problem definitionproblem definition are the most frequently mentioned ways of improvingimproving the usefulness of research.

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The Process of Defining the Problem The Process of Defining the Problem and Developing an Approachand Developing an Approach

• Tasks InvolvedTasks Involved Discussions with Decision Maker(s)Discussions with Decision Maker(s) Interviews with ExpertsInterviews with Experts Secondary Data AnalysisSecondary Data Analysis Qualitative ResearchQualitative Research

• Environmental Context of the ProblemEnvironmental Context of the Problem

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Discussions with the Decision Discussions with the Decision MakerMaker

• Discussions with the decision maker (DM) are extremely importantextremely important.

• The DM needs to understandunderstand the capabilities and limitations of research.

• ResearchResearch provides informationinformation relevantrelevant to management decisions, but it cannotit cannot provide solutionssolutions, because solutions requirerequire managerial judgment.

• Conversely, the researcher needs to understandto understand the nature of what decisions managers face - the the management problemmanagement problem - and whatwhat they hope to learn from the research

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Problem AuditProblem Audit

• The problem auditproblem audit provides a useful frameworka useful framework for interacting with the DM and identifyingidentifying the underlying causes of the problem.

• The problem auditproblem audit, is a comprehensivea comprehensive examination of a marketing problem with the goal of understanding its origin and nature.

• It is important to perform a problem audit because the DM, in most cases, has only a vague ideahas only a vague idea of what the problem is.

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Problem AuditProblem Audit

• The problem audit involvesinvolves discussions with the DM on the following issues: The eventsevents that led to the decision that action is needed, or

the historythe history of the problem. The alternative alternative courses of action available to the DM The criteriacriteria that will be used to evaluateto evaluate the alternative

courses of action. The potential actionspotential actions that are likely to be suggestedto be suggested based on

the research findings. The information information that is neededis needed to answer the DM’s questions. The manner manner in which the DM will usewill use each item of information

in making the decision. The corporate culturecorporate culture as it relatesit relates to decision making.

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Interaction Between the DM and the Researcher Should Be Characterized by:

• CommunicationCommunication (free exchange ideas)• CooperationCooperation (marketing research is a team project)• ConfidenceConfidence (mutual trust)• CandorCandor (an attitude of openness, no hidden

agenda)• ClosenessCloseness (feeling of warmth and closeness,

between the DM and the researcher)• ContinuityContinuity (must interact continually)• CreativityCreativity (the interaction between the DM and the

researcher should be creative rather than formulaic)

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Interviews with Industry ExpertsInterviews with Industry Experts

• Interviews with industry expertsindustry experts, individuals knowledgeable about the firm and the industry, may may helphelp formulate the marketing research problem.

• These expertsexperts may be found both insideinside and outsideoutside the firm.

• Typically, expert information is obtained by unstructuredunstructured personal interviews, without administering a formal questionnaire.

• The purpose of interviewing experts is to helpto help define the marketing research problemmarketing research problem rather than to to developdevelop a conclusive solution.

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Two Potential Difficulties of Two Potential Difficulties of Seeking Advice from ExpertsSeeking Advice from Experts

1. Some individuals whowho claim to be knowledgeable and are eager to participate may notmay not really posses expertiseexpertise.

2. It may be difficultdifficult to locate and obtain the help from experts who are outsideoutside the client organization.

For these reasons, interviews with experts are

moremore usefuluseful in conducting marketing researchmarketing research for industrial firms and for product of a technical nature, where it is relatively easy to identifyidentify and approach the experts.

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Secondary Data AnalysisSecondary Data Analysis

• Primary dataPrimary data, are collected or produced by the researcher for the specific purposethe specific purpose of addressing the research problem.

• Secondary data are:• data collected for some purpose other than the problem

at hand. • include information made availablemade available by business and

government sources, commercial marketing research firms and computerized databases.

• an economicalan economical and quickquick source of background information.

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Qualitative ResearchQualitative Research

• Sometimes qualitative researchqualitative research must be undertaken to gainto gain an understanding of the problemproblem and its underlying factorsunderlying factors.

• Qualitative research is unstructuredunstructured, exploratoryexploratory in nature, based on smallsmall samples, and may utilize popularpopular qualitative techniquesqualitative techniques such as• focus groupfocus group (group interviews), • word associationword association (asking respondents to indicate

their first response to stimulus words), and • depth interviewsdepth interviews (one-on-one interviews that

probe the respondents’ thought in detail).

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Environmental Context of the Environmental Context of the ProblemProblem

• To understand the background to a marketing marketing research problemresearch problem, the researcher must understand the client’s firm and industry.

• In particular, the researcher analyze the factors that have an impact on the definition of the marketing marketing research problemresearch problem such as: • past information and forecast pertaining to the industry and the

firm; • resources and constraints of the firm; • objective of the decision maker; • buyer behavior; • legal environment; • economic environment; and • marketing and technological skills of the firm.

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Management Decision Problem Management Decision Problem and Marketing Research Problemand Marketing Research Problem

• The management decision problemThe management decision problem asks what the DM needsneeds to do, whereas the marketing research problem ask what information is neededis needed and howhow it can best be obtained.

• ResearchResearch can provide the necessarythe necessary information to make a sound decision.

• The management decision problem is action The management decision problem is action orientedoriented. It is concerned with the possiblethe possible actions the DM could take. • How should the loss of market share be arrested?How should the loss of market share be arrested?• Should the market be segmented differently?Should the market be segmented differently?

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Management Decision Problem Management Decision Problem and Marketing Research Problemand Marketing Research Problem

• The marketing research problem is information The marketing research problem is information oriented.oriented. It wants to determine what information is neededneeded to make the best decision.

• It involves determiningdetermining what information is needed and how that information can be obtainedcan be obtained effectively and efficiently.

• Whereas the management decision problem focuses on symptomssymptoms, the marketing research problem focuses on underlying causescauses.

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Management Decision Problem Management Decision Problem versus Marketing Research Problemversus Marketing Research Problem

Marketing research Marketing research problemproblem

• Asks what information is needed and how it should be obtained

• Information oriented• Focuses on the

underlying causes

Management decision Management decision problemproblem

• Asks what the decision maker needs to do

• Action oriented• Focuses on symptoms

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Management Decision Problem Management Decision Problem versus Marketing Research versus Marketing Research Problem ExamplesProblem Examples

Management decision Management decision problemproblem

• Should a new product be introduced?

• Should the advertising campaign be changed?

Marketing research Marketing research problemproblem

• To determine consumer preferences and purchase intentions for the proposed new product.

• To determine the effectiveness of the current advertising campaign

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Defining the Marketing Research Defining the Marketing Research ProblemProblem

• The general rule to be followed in definingdefining the research problemresearch problem is that the definition should:

1. Allow the researcher to obtainto obtain all the information needed to address the management decision problem.

2. Guide the researcher in proceedingproceeding with the project.

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Defining the Marketing Research Defining the Marketing Research ProblemProblem (Cont) (Cont)

• Two common errors in problem definition: too too broadlybroadly definition and too narrowlytoo narrowly definition.

• A broad definition does notdoes not provide clear guidelinesclear guidelines for the subsequentsubsequent steps involve in the project.

• A narrow focus may precludepreclude consideration of some courses of action, particularly those that are innovative and may notmay not be obvious.

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The Broad Statement and The The Broad Statement and The Specific ComponentSpecific Component

• The Broad StatementThe Broad Statement provides perspectiveperspective on the problem and actact as a safeguard against committing the second type of error (define the marketing research problem too narrowly).

• The Specific componentThe Specific component focusfocus on the key key aspects of the problemaspects of the problem and provide clearclear guidelines on how to proceed further, thereby reducing the likelihood of the first type of error.

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Components of the ApproachComponents of the Approach

• In the process of developing an approach, we must not lose sight of the goal - the outputsoutputs.

• The outputs outputs of the approach development process should include the following components:• Objective/theoretical framework Objective/theoretical framework • Analytical modelsAnalytical models• Research QuestionsResearch Questions• Hypotheses, andHypotheses, and• Specification of Information Needed.Specification of Information Needed.

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Objective/Theoretical FrameworkObjective/Theoretical Framework

• In general, research should be basedshould be based on objective objective evidenceevidence and supported by theorysupported by theory.

• A theorytheory is conceptual scheme based on foundational statements called axioms, which are assumed to be true.

• Objective evidenceObjective evidence (that is unbiased and supported by empirical findings) is gathered by compiling relevant findings from secondary sources.

• The researcher should relyshould rely on theorytheory to determine which variables should be investigated.

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The Role of Theory in Applied The Role of Theory in Applied Marketing ResearchMarketing Research

• Conceptualizing and identifying key variables Conceptualizing and identifying key variables (IV and DV). (IV and DV).

• Operationalizing key variables.Operationalizing key variables.• Selecting a research design.Selecting a research design.• Selecting a sample.Selecting a sample.• Analyzing and interpreting data.Analyzing and interpreting data.• Integrating findings.Integrating findings.

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Analytical ModelAnalytical Model

• Analytical modelAnalytical model. An explicit specificationspecification of a set of variables and their relationshipsrelationships designed to represent some real system or process in whole or in part. Models can have many different forms such as: verbal, graphical, an mathematical structure.

• Verbal modelVerbal model. Analytical models that provide a a written representationwritten representation of the relationships among variables.

• Graphical modelGraphical model. Analytical models that provide a a visual picturevisual picture of the relationships among variables.

• Mathematical modelMathematical model. Analytical models that explicitly describe the relationships among variables, usually in equation formin equation form.

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Research QuestionsResearch Questions

• Research questionsResearch questions are refinedrefined statements of the specific components of the problem.

• The components of problemcomponents of problem definedefine the problem in specific terms, but further detail may be needed to develop an approach.

• Each component of the problem, may havemay have to be broken down into subcomponent or research research questionsquestions.

• Research questionsResearch questions ask what specific information is requiredrequired with respect to the problem components.

• Information obtained using research questionsresearch questions should aid the decision maker.

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Research Question and Research Question and Theoretical FrameworkTheoretical Framework

• The formulation of the research questionsresearch questions should should be guidedbe guided not only by the problem definition, but also by the theoretical framework and the analytical model adoptedadopted.

• The theoretical frameworktheoretical framework and the analytical analytical modelmodel playplay a significant role in the operationalization and measurementmeasurement of variables specified by the research questionsresearch questions.

• The research questionsresearch questions were further refined by precisely defining the variables and determining howhow they were to be operationalized.

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HypothesesHypotheses

• A hypothesishypothesis (H) is an unproven statementan unproven statement or propositionproposition about a factor or phenomenon that is of interest to the researcher.

• It may be a tentativetentative statement about relationship between two or more variables as stipulated by the theoretical framework or the analytical model.

• Often, a hypothesishypothesis is a possible answera possible answer to the research question.

• An important role of a hypothesishypothesis is to suggestsuggest variables to be included in the research designresearch design.

HypothesesHypotheses Vs Research Vs Research QuestionQuestion

Hypotheses go beyond research questions because they are statement of relationships or propositions rather than merely questions to which answers are sought.

Where are research questions are interrogative, hypotheses are declarative and can be tested empirically.

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HypothesesHypotheses

RQ: Do Customers of Sears exhibit store loyalty?H: Customers of Sears are loyal.• Hypotheses are an important part of the approach to

the problem.

Components of theMarketing Research Problem

Components of theMarketing Research Problem

Research QuestionsResearch Questions

HypothesesHypotheses

Objective/TheoreticalFramework

AnalyticalModel

Developmentof ResearchQuestionsandHypotheses

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Specification of Information Specification of Information Needed Needed

• By focusing on each component of the problem and the analytical framework and models, research questions, and hypotheses, the researcher can determinedetermine what informationinformation should beshould be obtained in the marketing research project.

• It is helpful to carry out this exercise for each component of the problem and make a list specifying all the information that should be collected.

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Internet and Marketing Research Internet and Marketing Research ProblemProblem

• Discussion with decision makerDiscussion with decision maker, anywhere at any time.

• Interviews with industry expertsInterviews with industry experts. The Internet can be searched to find industry experts outside the client’s organization.

• Internet search engine can be used to collect secondary data quickly and economically.

• Environmental Context of the problemEnvironmental Context of the problem. Past information and forecasts of trends can be found by searching for the appropriate information with the search engine.