pob stage 2 lecture 3 students

Principles of Business: Stage 2

Lecture 3: Market Research and Planning

Overview

2

One of the most important elements of marketing isunderstanding your customers’ needs and wants.However, in the complex world we live in it is easiersaid than done. In this lecture, we will explore theworld of marketing research and how we can create aconsumer insight. Thereafter, we will look at theplanning process that enables an organisation to takean insight and turn it into a strategy to beimplemented.

We will start of by evaluating the role of marketingresearch and look at the various techniquesresearchers have at their disposal. Thereafter, we willmove onto the role of strategic planning. This willinvolve looking at the steps organisations take todevelop and execute a plan.

Learning Outcomes

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• Determine the importance of carrying out market research.

• Describe the main qualitative and quantitative research methods.

• Determine the marketing planning process based on market and customer insight.

Market Research

Money won’t buy you happiness but it will pay

the salaries of a large research staff to study the

problem.

If you steal from one author it’s plagiarism; if you steal from many it’s research.

Overview of Market Research

Marketers make many decisions in their role within a business, and

to do so effectively, they need to have the

most current and accurate data possible.

They analyze demographic data and use the information to create detailed reports.

In turn, they use these reports to identify

which products and services to focus on,

what advertising steps to take, and what

decisions should be made—or completely

rejected.

The Importance of Market Research: 5 Reasons

Market research

centers your business on

your consumers.

It keeps the business

focused on what will make it

successful.

It allows the business to pursue the

most lucrative growth

strategy.

It keeps you relevant and

future focused.

Improves decision-making

capabilities and reduces

risk.

What is Market Research?

Marketing research is defined as the systematic design, collection, analysis and reporting of data and findings relevant to a

specific marketing situation facing the company.

View Video:

www.youtube.com/watch?v=cjk0dbB0uMw

Uncovers insights about a

situation.

Validates a hypothesis.

Enables robust

decision-making; no assumptions

Collecting data: What sources would you use?

Google

Talk to others

Collect new

insights

Expert Opinion

Evaluate past data

Collecting data: Where can you go?

View video: https://www.youtube.com/watch?v=Urrc95jrQcU&list=PLR7PU0468uL-7cZ3IGqyiN-onrRcbksVf

Market Research System and Process

Syndicated-service research firms

Custom marketing research firms

Specialty-line marketing research firms

Source: Bovee, et al 2013

Define the problem

• Define the problem

• Specify decision alternatives

• State research objectives

For example

In the highly competitive mobile communications

industry, marketing research is focusing on which new

services customers might be willing to pay extra for, such

as television viewing and music downloading.

Source: Kotler, et al 2013

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Develop the research plan

Data sources

Contactmethods

Researchinstruments

Samplingplan

Research approach

Source: Kotler, et al 2013

Primary and Secondary Research

Primary research consists of a collection of original

primary data collected by the researcher. It is often undertaken after the

researcher has gained some insight into the issue by

reviewing secondary research or by analyzing previously

collected primary data. It can be accomplished through

various methods, including questionnaires and telephone

interviews in market research, or experiments and

direct observations in the physical sciences, amongst

others.

Secondary research (also known as desk research) involves

the summary, collation and/or synthesis of existing research rather than primary research,

where data is collected from, for example, research subjects or

experiments.[1]

Sometimes secondary research is required in the preliminary

stages of research to determine what is known already and what

new data is required, or to inform research design. At other

times, it may be the only research technique used.

Primary and Secondary Research

Source: Kotler, et al 2013

Traditional Approach

The traditional marketing research approach means that desk research comes first,

providing information for the qualitative research, which in turn feeds into the

quantitative work.

View video: www.youtube.com/watch?v=GQfvocbRV3E

Research Methods

QuestionnairesQualitative Techniques

Technological

Consider open vs closed questions

Respondents’ answers are limited to a fixed set of

responses. Most scales are closed ended. Other types of

closed ended questions include:Yes/no questions - The

respondent answers with a "yes" or a "no".

Multiple choice - The respondent has several option

from which to choose.Scaled questions - Responses are graded on a continuum

(example : rate the appearance of the product on a scale from 1 to 10, with 10 being the most

preferred appearance).

No options or predefined categories are suggested. The respondent supplies their own

answer without being constrained by a fixed set of

possible responses. Examples of types of open ended questions

include:Completely unstructured - For example, "What is your opinion

on questionnaires?"Word association - Words are presented and the respondent mentions the first word that

comes to mind.

Closed Questions Open Questions

Do’s and Do not’s of Questionnaires

• Ensure questions are free of bias

• Make questions simple

• Make questions specific

• Avoid jargon

• Avoid sophisticated words

• Avoid ambiguous words

• Avoid negatives

• Avoid hypotheticals

• Avoid words that could be misheard

• Use response bands

• Use mutually exclusive categories

• Allow for ‘other’ in fixed response questions

Source: Kotler, et al 2013

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Qualitative Research Approaches

Observation

Focus group

Interviews

Ethnographic

Ethnographic Approach

Source: Kotler, et al 2013

Deep Dive into Ethnography

View video: https://www.youtube.com/watch?v=9tHgNXzS2EY

Technology Based Techniques

Galvanometers

Tachistoscope

Eye cameras

Audiometers

GPS

Source: Kotler, et al 2013

Lets move into strategic planning

Planning at 3 levels

Strategic planning meshes

the company’s capabilities and

resources to what is happening in the marketplace. This planning helps the company decide—

over the long term—how it wants

to act, where it wants to be, and

what it wants to do. Without strategic

planning, a company would be directionless and

ineffective.

Operational planning

focuses on deciding how the company will implement the

functional plans. For example, what are the specifications of the three products

that will be developed to support the

functional and strategic

objectives?

Functional planningEach functional area in a company develops its functional plans, not just the marketing department. For example, if one of the strategic plans is to grow revenue by 5% in five years, then a functional plan supporting that goal might be to develop three new products to increase revenue.

Consider how you would use market research in each of these areas

What does it involve?

Planning in 3 Steps

Analyse the market &

environment

Set the marketing objectives

Develop marketing strategies

Analyse the market and environment

Source: Kotler, et al 2013

Setting Marketing Objectives

After performing the SWOT analysis, the next step is to use that information to help set the marketing objectives.

Analyzing the implications of the SWOT analysis is what drives the objectives and strategies. After the marketing managers have a good understanding of the internal and

external environment, they will begin to develop marketing objectives and strategies.

Possible objectives:

• Growing market share

• Growing revenues or sales

• Increasing brand awareness

• Developing a certain number of new products

• Increasing referral rates

• Increasing levels of customer satisfaction

Source: Kotler, et al 2013

Objective Coordination & Budgets

Strategic objective coordination

Keep in mind that possible objectives must be

coordinated with the overall strategic objectives but should be specific to the marketing

department. For example, if the strategic

objective of the company is to increase profitability by 15% in the next three years, then the marketing department’s objective might be to reduce sales and marketing costs by

5% as a way to help contribute to meeting that

goal.

Marketing budget

As part of this process a marketing budget is also

developed, that details revenues, including how many units are

forecast to be sold at what price, market shares, distribution, and

promotions costs.

Source: Kotler, et al 2013

Developing Marketing Strategies

Essential work for next week

• Please consult the OLE for details of:– Essential readings*

– Seminar/workshop preparation work*

– Recommended further readings

– Any additional learning

* Essential readings and preparation work must always be completed in time for the next session.

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Appendix – Sources for illustrations

Slide 4:www.wikipedia.org

Slide 5:www.marketingprofs.com

Slide 8:www.artslide.com

Slide 16:www.emeraldinsight.com

End of presentation

© Pearson College 2013