The process of marketing research includes the following steps: 1. Defining the Problem or Need 2. Determining who will do the Research 3. Picking out the Appropriate Methodology 4. Data Collection Process 5. Data Preparation, Tabulation and Analysis of Results 6. Presentation and Report Generation.
Marketing Research Process Steps
Marketing Research Process – 5 Steps (With Examples)
The marketing research process is a well-defined set of steps that, if followed, should yield invaluable information concerning a firm’s market. A systematic approach to marketing research follows a five-step process – (1) problem definition, (2) plan development, (3) data collection, (4) data analysis, and (5) taking action.
Sometimes marketers skip steps if they get an early solution to the problem, or go back to an earlier step to gather additional information or reanalyze data as needed.
Step 1 – Problem Definition:
Problem definition is the first step in the marketing research process. Often firms know that they have a problem but cannot precisely pinpoint or clearly define the problem. Clarifying the exact nature of the problem prevents the firm from wasting time, money, and human resources chasing the wrong data and coming up with the wrong solutions.
To begin, a firm should set specific research objectives. As with overall marketing objectives, research objectives should be specific and measurable. They represent what the firm seeks to gain by conducting the research.
To illustrate using our Fuze example, let’s assume that one of the beverages Fuze produces has seen its profits slip over the past year. In this case, Fuze’s defined problem would be to determine why the beverage business has lost profitability over the past year. To begin, the company might perform a situation analysis.
The situation analysis could include the composition of the target market, specifics of the marketing mix currently in use, economic factors such as employment and inflation, and the state of the competition.
For example, if the beverage market itself is becoming less profitable, the firm may not need to continue to research why the company’s profits have slipped. In that case, Fuze would go back and redefine the problem. If, however, the situation analysis reveals that other companies are still profitable, Fuze should seek possible root causes of the problem.
Let’s assume Fuze determines that consumers like the product, but the company’s promotional efforts are not producing results. Consequently, Fuze is losing market share. From there, Fuze sets its research objective – to determine what exactly about the promotional campaign is causing the company to lose market share.
With this objective in hand, the Fuze marketers can write a formal proposal to senior management outlining the research and seeking approval to develop a plan for the project.
Step 2 – Plan Development:
Plan development, sometimes called research design, involves identifying what data sources will be utilized, what specific type of research will be used, and what sampling methods will be employed. The first aspect of designing the research plan involves hypothesis development.
A hypothesis is an educated guess based on previous knowledge or research about the cause of the problem under investigation. In our beverage example, Fuze may develop a hypothesis that the target market has not been sufficiently exposed to the promotional campaign.
To test its hypothesis, Fuze must collect data. First, it must determine whether it should seek primary or secondary data. Primary data are collected specifically for the research problem at hand. In the case of Fuze’s product, such data might include how many people in the target market have been exposed to a particular advertisement, or how they’ve reacted to the advertisement.
Secondary data are collected for purposes other than answering the firm’s research questions. Often the company itself has collected this data from its day-to-day operations and can access it directly. Other times, it must go to another source.
For example, if Fuze wanted to know the size of its target market, it could go to the United States Census Bureau’s website (www(dot)census(dot)gov) to find out how many people belong to a particular demographic group, or how many people from a demographic group live in a certain geographic area.
While primary data are more expensive to collect than secondary data, firms generally find primary data more valuable because they are collected to answer a specific research question. In the case of Fuze, the nature of the research objective would likely lead the firm to seek primary data. Secondary data may not shed light on the connection between the firm’s promotional activities and the product’s falling market share.
Difference between Primary and Secondary Data:
1. Collection Method Examples:
i. Focus groups
iv. Data gathered by equipment (e.g., video)
v. In-depth personal interviews.
i. Pertains only to firm’s research
ii. May provide insight into why and how consumers make choices.
i. More expensive
ii. May be difficult to enlist customer participation
iii. May take excessive amount of time to collect.
4. Examples of Use:
i. To understand what motivates consumers
ii. To determine the effect of variables (e.g., price) on product choice
iii. To gain feedback on company’s existing and proposed products.
1. Collection Method Examples:
i. Literature reviews
ii. Online electronic searches
iii. Company records
iv. Marketing information systems
v. Private research companies
vi. Boundary spanners (e.g., salespersons).
i. Less expensive (often free)
ii. Information typically readily accessible.
i. Data may not be relevant
ii. Data may not be accurate
iii. Data may have been altered
iv. Data may contain bias.
4. Examples of Use:
i. To gather macroeconomic data
ii. To gather socioeconomic data
iii. To obtain information about competitors
iv. To gain insight into international cultures and markets.
Types of Research:
Next, Fuze marketers must decide what type of research they should use to collect the data.
The firm can choose from among the following three basic types of research:
1. Exploratory Research:
Exploratory research seeks to discover new insights that will help the firm better understand the problem or consumer thoughts, needs, and behavior. Exploratory research usually involves some type of face-to-face interaction between the person or persons collecting the data and the person or persons providing the data.
For example, Fuze could interview people to ask them questions about their beverage buying behaviors to understand how nutritional information affects consumer purchases.
2. Descriptive Research:
Descriptive research seeks to understand consumer behavior by answering the questions who, what, when, where, and how. Examples of descriptive information include a consumer’s attitude toward a product or company; a consumer’s plans for purchasing a product; specific ways that consumers behave, such as whether they prefer to shop in person or online; and demographic information like age, gender, and place of residence.
To conduct descriptive research, Fuze could conduct an in-store survey that asks consumers how they view the company and its beverage products.
3. Causal Research:
Causal research is used to understand the cause-and-effect relationships among variables. Causal research involves manipulating independent variables (the cause or source) to see how they impact a particular dependent variable (the effect or outcome).
Fuze could conduct an experiment, for example, that manipulates the packaging of its beverages (the independent variable) to see how different package styles affect sales (the dependent variable).
Fuze marketers will establish data collection procedures based on the type of research the company decides is most appropriate to achieve the research objective or objectives. Companies need not limit themselves to one type of research.
For example, Fuze may use exploratory methods to get a deeper understanding of what motivates people to buy a beverage product and causal techniques to analyze how changes to the product or price will affect sales.
It would be impossible—from both a budget and time perspective—for marketing professionals to obtain feedback from all the members of its target market. Instead, they must rely on sampling. Sampling is the process of selecting a subset of the population that is representative of the population as a whole.
How researchers conduct sampling is critical to the validity of the research findings. If the firm uses secondary data, the marketer must make sure that the population from which the data are taken relates to the research objective. For example, if Fuze uses archived data that the firm compiled itself, it must ensure that the data represent consumers from its target market.
Irrelevant data from another target market may lead to inaccurate conclusions. If the firm requires primary data, it can select a sample from which it can generalize findings. A sample is a representative subset of the larger population (in this case, beverage drinkers).
Sampling can be broken down into two basic types:
1. Probability and
1. Probability Sampling:
Probability sampling ensures that every person in the target population has a chance of being selected, and the probability of each person being selected is known. To conduct probability sampling, Fuze would need to structure its study so that it could calculate each beverage drinker’s probability of being included in the sample.
The most common example of probability sampling is simple random sampling. In simple random sampling, everyone in the target population has an equal chance of being selected. Implementing a simple random sample typically involves generating a table of random numbers and assigning one number to each potential participant.
The researcher then uses the number (or numbers) to select the members of the population to receive a survey. Simple random sampling is the equivalent of drawing names from a hat; every name in the hat has an equal chance of being chosen.
2. Nonprobability Sampling:
Nonprobability sampling, on the other hand, does not attempt to ensure that every member of the target population has a chance of being selected. Nonprobability sampling contains an element of judgment in which the researcher narrows the target population by some criteria before selecting participants.
Examples include quota sampling, in which the firm chooses a certain number of participants based on selection criteria such as demographics (e.g., race, age, or gender), and snowball sampling, in which a firm selects participants based on the referral of other participants who know they have some knowledge of the subject in question.
While probability sampling enables researchers to generalize findings from a portion of a target population, nonprobability sampling can generate findings that may be more appropriate to the research question.
Step 3 – Data Collection:
The third step of the marketing research process, data collection, begins with the firm’s decision to use secondary or primary data.
Secondary Data Collection:
Secondary data can come from two sources – internal and external. Internal data are collected by the company and can include things like sales by product, information about individual purchases from loyalty cards, previous research reports, accounting records, and market information from the sales force.
Companies often build large internal databases in which to store such data. Much of this information now comes from company websites, such as – Amazon’s database on individual customer purchases.
External secondary data can come from many sources. Governments compile a lot of data and make it available to the general public. U.S. government agencies like the Economics and Statistics Administration and the Census Bureau provide a great deal of useful secondary data in various publicly available reports.
Other sources of secondary data include trade associations, academic journals, business periodicals, and commercial online databases such as – LexisNexis. The Internet is a rich source of secondary information. Search engines like Google and Bing help researchers find secondary sources of information.
However, it is important to understand that information found on the Internet can be biased, inaccurate, and unsubstantiated. Researchers must always be cautious about using such information and verify its accuracy against known valid sources before using it.
Primary Data Collection:
Primary data collection may be necessary if secondary information cannot adequately answer the research question. Depending on the research design (exploratory, descriptive, or causal), the company can choose to use one of a variety of primary data collection methods. Primary data collection methods can be either qualitative or quantitative.
Qualitative research includes exploratory types of research such as:
i. Focus groups,
ii. Interviews, and
i. Focus Groups:
Focus groups are conducted by a moderator and involve a small number of people (usually 8-12) who interact with each other in a spontaneous way as they discuss a particular topic or concept. Researchers can hold focus groups either in person (e.g., in a special room in a shopping mall) or in an online format.
Fuze could use focus groups to better understand how consumers feel about its product versus other beverages. The interactive nature of this setting lends itself to drawing out opinions and generating insights into a marketing question. However, focus groups are expensive to perform and must be conducted by experienced people who know how to properly direct discussions in a way that elicits useful information from participants.
In an interview, the researcher works with one participant at a time. During the interview, the researcher asks open-ended questions about how the individual perceives and uses various products or brands.
For example, Fuze could ask participants what thoughts go through their heads when they see the beverage on the store shelf. Interviews can be useful in figuring out what people think but have the limitation of being very time-consuming.
Observation involves watching how people behave and recording anything about that behavior that might be relevant to the research objective. For example, Fuze could set up a mock store aisle full of beverages and watch how participants react to various types of packaging or where beverages are positioned in the aisle.
Companies often find such information useful, but participants may subconsciously try to please researchers and act as they think researchers expect them to. To combat this tendency, major consumer packaged goods companies like Procter & Gamble, Unilever PLC, and Kimberly-Clark are combining eye-tracking technology with computer simulations of products and store layouts to find out which of their designs get noticed in the first 10 seconds that a customer spends looking at a simulated store shelf.
While observation allows researchers to see how people behave, it is not useful in determining why they behave that way. Firms often use observation in conjunction with other techniques that help researchers identify the motivation behind particular behaviors.
Beyond these traditional qualitative methods, the Internet is giving rise to a new form of qualitative research called neurography, which involves observing the behavior of online communities that have been organized around a particular consumer interest.
Often the members of such communities are first movers, that is, consumers who take the lead in adopting new products and are dedicated to the product. The researcher enters the online forums to gather data and then uses the community members to verify his or her findings.
Qualitative methods like interviews and focus groups can provide researchers a great deal of insight, but they don’t always allow researchers to draw generalized conclusions about the larger consumer population. To collect the necessary data to achieve their research objective, companies often turn to quantitative research.
Quantitative research includes:
ii. Experiments, and
iii. Mathematical modelling.
Surveys or questionnaires pose a sequence of questions to respondents. They provide a time-tested method for obtaining answers to who, what, where, why, and how types of questions and can be used to collect a wide variety of data. In addition, they help determine consumer attitudes, intended behavior, and the motivations behind behavior.
Surveys often employ multiple-choice questions, making them appropriate for gathering feedback from a large number of participants. They can be administered by mail, at shopping malls, on the telephone, or online. Fuze could use a survey to gather data from a large population about which of the company’s promotions consumers have seen and their reactions to those promotions.
Experiments are procedures undertaken to test a hypothesis. They allow researchers to control the research setting so that they can examine causal relationships between variables. Fuze could undertake an experiment in which researchers change the color of the product’s packaging (an independent variable) and observe how often consumers look at the product (the dependent variable) on a simulated store shelf in a laboratory.
Researchers perform field experiments in natural settings like stores or malls. While field settings offer an element of realism, they are also more difficult to control, which can lessen the validity of the experiment.
Some companies use neuromarketing techniques that measure brain activity when a participant is subjected to a particular stimulant to understand how consumers feel about products, packaging, and advertisements. One neuromarketing study compared the brain scans of participants tasting Pepsi and Coke.
In this experiment, taste was the stimulant. Based on the part of the brain activated during the tasting session, the researchers found that participants in the study were buying Coke for reasons related less to their taste preferences and more to their experience with the Coke brand. This type of finding could be used to develop advertisements that relate a product to the type of thought processes that people use to choose products.
iii. Mathematical modeling:
Another type of causal research involves mathematical modeling, in which equations are used to model the relationships between variables. For example, Fuze could use mathematical modeling to investigate the effect on sales if the firm were to increase or decrease the price of the product.
As with secondary data, the Internet can be leveraged as a tool for collecting primary data. Once data have been collected, the marketing researcher moves on to the next step – data analysis.
Step 4 – Data Analysis:
The purpose of data analysis is to convert the data collected in Step 3 into information the firm can use to solve the marketing problem originally identified. Analysis of the data should allow marketers to accept or reject the research hypothesis or hypotheses. If it doesn’t, more research might be necessary.
i. Analyzing Qualitative Data:
Data analysis can be challenging, particularly when applied to qualitative data. For example, interviews can be directed in a way that takes participants away from what they were thinking and toward what the researcher wants to hear. Results may be difficult to measure objectively and in ways that help marketers formulate a marketing strategy.
Additionally, due to the time-consuming nature of qualitative research, sample sizes can be very small and therefore may not represent the general population of the target market. Poor interpretation presents another challenge to data analysis. Qualitative data, which often involves open-ended questions, can include subtleties that a marketer might miss.
For example, if the researcher fails to notice that the participant pauses when trying to recall details of one advertisement but quickly gives accurate descriptions of another advertisement, a significant finding—that the second advertisement may be more effective than the first—would be lost.
Alternately, marketers could misunderstand respondents’ feedback or allow their own bias to influence their interpretation. One way that researchers check their interpretations is to review their findings with research participants to make sure that they understood what the participant actually meant.
Despite its drawbacks, researchers can gain substantial insight from qualitative research. Qualitative data gathering and analysis can give researchers ideas about the subject that can later be tested through quantitative research. Because there are no predetermined sets of responses (e.g., multiple-choice answers), the participant can open up to the interviewer and cover things that the researcher may not have thought of previously.
Also, the researcher can probe the subject in greater detail and with much more flexibility, and therefore may come up with more details concerning consumer motivations and behaviors than quantitative methods can reveal.
ii. Analyzing Quantitative Data:
Quantitative methods for collecting and analyzing data can often be done quickly, at low cost, and may help researchers understand cause-and-effect patterns in consumer behaviors.
However, as with qualitative data, there are drawbacks. While statistical analysis of quantitative data might give marketing professionals’ insight into consumer behavior, whether or not the results should be accepted depends on how well the sample represents the general population.
This can be determined using statistical software. The representative nature of the statistics may impact whether or not the marketing team ultimately accepts the original hypothesis. For example, Fuze would need to confirm that the results of a survey related to the firm’s promotional materials represent the behaviors and attitudes of the overall beverage market, with no bias toward one group of consumers through sampling errors.
Data analysis can involve other issues. Validity concerns how well the data measure what the researcher intended to measure. Often validity is called into question because of poorly worded questions that can be interpreted by the participant in several ways. To prevent this, researchers often pretest the questions before using them to evaluate how well people filling out the survey understand them.
In addition, quantitative data suffers from issues related to participation. Surveys often have low response rates, and it can be difficult to determine why some people have not responded to a survey. Respondents who select to participate may exhibit a bias stemming from their willingness to provide feedback.
Other problems with quantitative methods include the restrictive nature of surveys that do not give respondents an opportunity to explain or further elaborate on their answers. For these reasons, marketing professionals must understand the potential pitfalls of a research project and work together with the researcher to avoid as many as possible.
In our beverage example, Fuze hypothesized that the decrease in profits stemmed from the fact that the target market had not been sufficiently exposed to the promotional campaign. Let’s assume this hypothesis was accepted based on data showing that much of the firm’s target market had not seen the firm’s latest television ad.
Once marketers have interpreted the data and feel confident about the findings, they can move to the final step of the process – taking action.
Step 5 – Taking Action:
The culmination of the marketing research process is a formal, written report to decision makers. The report typically includes a summary of the findings and recommended actions to address the problem. Usually, an oral report on the project is presented along with a written one. Both reports should communicate any limitations of the research.
Limitations could include a variety of things, including inadequate sample sizes or samples that do not adequately represent the population under study. It is important that marketers honestly discuss the limitations of the research. Such limitations should be considered before the firm makes any final decisions based on the research.
Research report findings should be presented in a clear and understandable manner and include appropriate visual data, such as – figures and tables, to support the findings and recommendations. The research report should allow the marketing manager to solve the marketing problem.
For example, let’s say that the results of Fuze’s research indicate that its consumers spend their time on the Internet watching videos and streaming shows and movies rather than watching cable TV. This finding might prompt the marketing department to develop a new promotional campaign that includes YouTube videos and ads on services like Hulu, potentially increasing market share and profitability.
As we’ve seen, information about what consumers need and want and what motivates their buying behaviors is available, but it must be collected and analyzed effectively.
List of Steps Involved in Marketing Research Process – Discussed!
Every research, in order to yield reliable and valid result must be conducted following a well-established plan over a period of time. Researchers in discipline of marketing and other social sciences have prescribed a sequential, interrelated and coordinated set of activities to conduct research on marketing. These activities together make marketing research process.
Detail description of each step of marketing research process is given below:
1. Formulating Research Problem:
i. It is the first and foremost step in Research Process.
ii. Research Problem refers to a difficulty, which a manager experiences pertaining to a theoretical or practical situation that he faces and wants to obtain a solution for the same. Managers share these managerial problems with researcher who translates them into a research problem.
iii. There are two types of Research problems –
(a) Related to Nature (Market Study or Consumer Study)
(b) Related to Variables (Scientific, Mathematic or Statistical)
iv. Researcher must check the feasibility of a particular solution before formulating the problem.
v. Two steps are involved in formulating the research problem –
(a) Understanding the problem thoroughly and
(b) Re-phrasing the same into meaningful terms.
vi. Problem well defined is half solved. For example problem of limited profit may sometimes be wrongly understood as problem of inadequate sales and the actual problem may be due to pricing or cost.
vii. Need analysis for problem solution –
(a) First of all they it is to be decide whether conduction of research for solving problems is really needed or existing information with the executives is ample to make decision.
(b) If information is needed then Market Researcher should design a Research Problem keeping in mind the following points –
(1) To meet the decision maker’s (i.e. executives) requirement of information that is needed for making decision.
(2) To know the resources available.
(3) To know the objectives or goals of decision maker which he wants to accomplish.
(4) To find the alternative courses of actions – Alternatives could be the various course of action that could be adopted under a given situation. The researcher’s responsibility is to understand the problem comprehensively and put forth all possible alternatives. Further he should generate information that allows decision maker to select one of these alternative that serves his purpose best. For example Dhara Vegetable oil marketed by Mother Dairy Ltd. wants to change its containers then alternative courses of actions can be –
(i) Adopt the new container nationally as soon as possible.
(ii) Stay with the present container.
(iii) Convert production of one of the company’s plant to new container and watch the response.
(c) To evaluate the outcomes of each alternative courses of action and select one to concentrate and focus research effort. It is like setting direction of research work.
2. Review the Literature:
Once the problem is formulated then a brief summary of it should be written down. Researcher should undertake extensive literature survey connected with the problem. For this purpose one must go through Journals, published and unpublished bibliographies, Government reports or Books.
3. Formulation of Hypothesis:
i. Researcher should state in clear terms the Working Hypothesis.
ii. Working Hypothesis is tentative assumption made in order to draw out and test its logical or empirical (Observations) consequences.
iii. In making statistical decisions, we make certain assumptions or guesses about the population involved in our marketing research problems. These assumptions are known as statistical hypotheses. Whether, these assumptions are true or false are tested during the research.
iv. The researcher sees if the research out comes (statistic) differs from the formulated hypothesis. After noting the difference between the statistic and hypothesis, the researcher decides as to whether or not difference is significant. If the difference happens to be is significant, the hypothesis is rejected.
On the other hand, the hypothesis stands accepted if the difference is insignificant. Owing to this reason, we call this process as test of hypothesis in marketing research.
v. In developing hypothesis the researcher’s first task is to set up two statements. The first one of these two statements is called null hypothesis (Ho). The null hypothesis is a statement of no true difference in the sample and population parameter in a particulars study. Hence the name given is null means invalid, void or amounting to nothing.
Any difference found is due to fluctuations of sampling. The null hypothesis must be developed in such a way that its rejection leads to the acceptance of other statement called alternative hypothesis (Ha).
The alternative hypothesis is different from the null hypothesis. The two hypotheses are constructed in such a manner that if one is true, the other has to be false and vice versa.
vi. For example in Science we assume that the weight of human being increases with the increase in age.
In Business Management the demand of Luxury Goods increases with the increase in per capita income and frequency of advertisements.
vii. Hypothesis should be very specific and limited to the objective of research because it has to be tested.
viii. Hypothesis can be developed through –
(a) Discussions with colleagues and experts.
(b) Examination of Records.
(c) Review of Similar Studies.
(d) Personal investigations.
4. Research Design Development:
i. Research design is a preparation of blue print of intended research.
ii. Research design is a guideline for rest of Research process.
iii. Function of Research design is to provide the collection of relevant evidence with minimal expenditure of effort, time and money.
iv. Research design describes the methods for data collection and data Analysis.
v. Research design determines the sample design and report presentation.
Sample is a relevant fraction of population, which will represent the entire population or Universe.
The Researcher must decide the way of selecting the sample design. A Sample design is a definite plan to determine before any data are actually collected for obtaining a sample from a given population.
In short Research design means to know the sample unit, sample size, sample procedure and to decide the sampling method i.e. probability or non-probability sample. Here we also come to know the limitations and scope of sampling.
Research design also includes the method adopted for collection of data generally referred as observation design. In order to conduct good and meaningful research a sound in method and sources of data is required.
There are generally two types of data:
(i) Secondary Data – Are those data, which are collected for some earlier research work and can be used in studying the research, which the researcher has presently taken.
(ii) Primary Data – Are those data, which are to be collected freshly. Primary data can be collected by researcher or his agents and serves as first hand data to the researcher. Since a large number of research on marketing involves collections of data directly from consumers, retailers, distributors etc., researcher has to mostly deal with primary data. Few common methods of collecting primary data are as follows –
(a) By Observation Method – We observe the action of respondent either directly mixing with them or indirectly observing them. Research instrument for observation method can be cameras, tape recorders, VCRs, CDs or Tally sheets.
(b) Through Personal Interviews.
(c) Through Telephone Interviews.
(d) Through Mailing of Questionnaire.
(e) Through Interview Schedules.
5. Field Work and Collection of Data:
(i) Conduct the research using the instrument and data collection method already decided.
(ii) Adjust the problems of no-at-home, refusal to co-operate, biasness of interviewers, and biasness of respondents.
6. Analysis and Interpretation of Data:
i. Data Analysis is to extract meaningful information from the collected data.
ii. Data are first Edited, Coded and Tabulated for the purpose of analysis, hypothesis testing and interpretation.
(a) Editing is the activity of Inspecting, Correcting and Modifying the collected data. Editing consists of two stages –
(i) Field Editing – Refers to data which are collected during personal interviews, since during interview this movement interviewer does not have much time to fill-up the entire questionnaire so interviewer usage short terms or symbols for recording the answers and after the interview is over interviewer completes the entries. He also checks the responses that are incomplete or have in consistency and get them eliminated then and there.
(ii) Office Editing – Refers to editing of data which are collected through mail questionnaire and not through personal interviews because data collected through personal interviews may be edited infield but data collected through mail questionnaire can only be edited in the office.
(b) Coding is the process of assigning number or symbols. For example the gross income like 9,885 or 9,875 of the respondent can be coded and grouped in the following manners –
Less than – Rs. 10,000
Rs. 10, 000 to 15,000
Rs. 15,000 to 20,000
Gender of respondent May be added on ‘0’ and ‘1’ for male and Female respectively.
(c) Tabulating is combining and representing the collected data in rows and columns. Data is analyzed by diagrams, graphs, charts, pictures and by using correlation / regression analysis techniques or any other suitable statistical technique.
(d) Under Hypothesis Testing Researcher tests the hypothesis, which he had formulated earlier. Various tests can be applied for hypothesis testing such as Chi-Square test, T test or F test etc.
Advance multivariate techniques could also be used to solve marketing related problems and testing hypothesis such as conjoint analysis for attribute development of products, cluster analysis for segmentation, multi dimension scaling for perceptual mapping of consumers and positioning.
(e) Generalization and Interpretation After hypothesis is tested the Researcher arrives at conclusion. Generalization of conclusion is a step towards building theory. In daily course of business one cannot develop Hypothesis and conduct research every time, hence managers depend on generalised conclusions reported by various researches to take decisions.
However they must remain cautious while referring outcomes of other research. They should always interpret the findings of other research keeping in mind their own business circumstances.
7. Presentation and Reporting:
i. After data is Analyzed and Interpreted then researcher presents results of research in a systematically typed research report.
ii. Get report typed and bound as per requirements.
iii. Give the copies of the report to the concerned authority and discuss research results.
Now a days technology and software like SPSS, SAS, MINTAB etc. has made marketing research quite sophisticated and yield quick results that are quite accurate and reliable. Marketing research has become indispensable part of marketing.
6 Steps Involved in Rural Marketing Research Process
Marketing research like any other research involves a sequence of steps aimed at exploring and validating a hypothesis. Most of the steps undertaken for rural marketing are almost the same as followed in conventional or urban marketing research.
Let’s understand these steps in brief and relate them to rural marketing research:
Step 1 – Problem Definition:
The term “problem”, means a question or issue, which has to be examined. This is a very critical step. Hence, it is often said that identification of the real problem is half the job done. The problem can be seen from the perspective of the decision maker and from the perspective of the market researcher.
The problem from the perspective of decision maker is the Management decision problem. When there is a gap between the actual situation and the desired situation, we say that a Management decision problem exists.
For example, when actual sales of a company marketing agricultural pumps for irrigation purposes, drops below the previous year’s sales we see it as a problem. Even, when the company has experienced a healthy growth and has a satisfactory market share, we may say a problem exists if the company has not capitalized on the opportunities.
The problem from the Market researcher’s perspective is to identify information which has to be collected to help the decision maker take an informed choice. Thus, in the above situation the market research problem could be to frame hypothesis which explain drop in sales and collect information which provides insights into possible causes.
For example, the sales could have declined due to a fall in farmers’ purchasing power because of a bad monsoon and resulting crop failure or could have been due to increased competitor activities. The understanding of causes for drop in sales will help the decision maker take appropriate corrective action.
Step 2 – Research Budget:
Managers are willing to pay for marketing research when the data obtained from the internal reporting system and marketing intelligence system fails to provide adequate information. The budget decision involves two steps – (a) specifying the approximate value of information, (b) determining the maximum amount that can be spent.
Step 3 – Research Design:
A research design is the program that guides the investigators in the process of collecting, analysing and interpretation of observations. It is a logical and systematic plan prepared for directing a research study. A research design includes choosing the approach to research, selecting the data collection methods, determining the sample and selecting the data analysing techniques.
Choosing the Research Approach:
There are broadly three approaches of research – exploratory, descriptive and causal.
Exploratory research helps in identifying the various variables which can be measured within the study to give the better understanding of the research problem. Exploratory research helps in formulating a problem which can be researched as well as hypotheses which can be tested.
Descriptive research helps us to describe the market and marketing mix characteristics. Thus, it may suggest alternative ways in which products can be distributed in various rural markets, list and compare the quality and features of competitive products available in the market.
Descriptive research involves understanding the association between two or more variables. The major difference between exploratory and descriptive research is that, in the case of descriptive research, specific research question have been formulated before the research is undertaken. It is possible to formulate such specific research questions in a descriptive research because of the earlier exploratory research study which help the researcher to identify research issues, variables which need to be measured and approaches to measure them.
In causal research, the researchers try to find out the answer for the “why” questions. When the researcher wants to find out the impact of change in one variable on another variable then she may use causal research. For, example the researcher can study the impact of usage of different varieties of fertilizers on rice productivity in a region, using causal research approaches. Causal research can also be used to demonstrate the effect of using pesticides to restrict crop damage due to insects. Causal research is also called as experimental research.
Researchers have been concentrating more on qualitative research in the rural markets on areas like- market feasibility, use of different innovative promotion and communication channels etc. Quantitative research is less popular in rural markets due to low penetration and consumption of most of the products.
Step 4 – Research Proposal Preparations:
The research proposal provides the researcher with a blue print for conducting and controlling the research project. It facilitates meaningful exchange of thoughts and opinions between researcher and the decision maker. A good research proposal includes abstract/Executive summary, introduction, hypotheses/objectives of the research, methodology and estimated time frame.
Step 5 – Data Collection:
Data collection presents a unique challenge in rural setting. A detailed plan should be prepared in advance covering number of supervisors and field investigators, schedule of data collection and budget. The investigators have to be briefed about the challenges involved in conducting rural market research and provided suitable training in research methods.
Rural researcher needs to understand the local dialects to be effective communicator. He should be able to discern between sensitive and non-sensitive issues and tackle them carefully. Since he cannot write down everything especially in front of rural people, he needs to have good memory to remember all the relevant information.
Rural people are suspicious about researchers, so the researchers have to win their confidence by taking care of following:
i. They should wear simple clothes and speak in local language.
ii. They need patience to build rapport with villagers to get the desired information. Interviewee should be made feel important. Researcher even has to listen to irrelevant talks.
iii. Interviewee should be told about the purpose of the research and how valuable are his/her responses to the company in bringing out new product as per their (villagers) need.
iv. Male researcher has to respect the customs of the areas. They should reach out to woman respondents through their husbands.
v. Researcher may have to gather information in a group instead of one-to-one interview, as rural people like to interact with strangers in a crowd.
Researcher should interview both husband and wife for daily consumed goods because wife may be the user but buying decision for the product may be made by the husband. Researcher should also choose appropriate time for getting the information it can be either morning before going to fields or in the evening after the people returned home from fields.
A person who is familiar with rural language, customs and traditions should interview rural people without hurting their sentiments. Researcher can also take help of NGO workers or Aaganwadi workers, who understand rural people better. Government officials may not be the right people for research since they have been seen as the grant providers or officials who may put tax or other hurdles for the villagers.
Step 6 – Data Analysis:
A large number of data collected by the researcher makes no sense if it is not properly analyzed. Analysis has to be unbiased and inference should be drawn carefully without any prejudices.
Typical Marketing Research Process Depicted Stage-Wise
The marketing research process involves a round of separate stages of data interpretation, organization and collection. These stages could be considered as a benchmark of market research, but it depends on an organization how they have encapsulated their strategies to follow this process. Hence some of the interlinked stages could be conducted repeatedly and some of the stages can also be omitted.
Given below is a typical marketing research process which is depicted stage-wise:
1. Defining the Problem or Need:
The starting phase is always identifying the reason or problem for which research is to be conducted. This includes collecting of relevant initial information and how this information will affect decision making process. It also includes defining problems after discussing with decision makers of the organization. Once the problem is defined precisely and the need of research is discussed, the further process could be conducted in an efficient manner.
2. Determining who will do the Research:
Once the initial stage of defining the problem and the need of research is done, it is important to determine who will do the research and what will be the approaches to resolve these problems. This involves creating a problem solving framework and analytical models after discussing it organization experts. In this sample case studies are created according to the defined framework by enforcing the relevant information and secondary data.
3. Picking out the Appropriate Methodology:
A specific methodology is entailed by the research professional after identifying the specific needs and exploring the case studies. It may include a combination of specific approaches like telephone survey web or email survey, one-to-one interviews, secondary research etc.
This methodology acts as a blueprint of research process and following basic steps:
i. Methods for collecting and preparing quantitative information.
ii. Determining the need of this information.
iii. Scaling and measuring procedures.
iv. Designing sample Questionnaire.
v. Formulating case studies and sampling process.
vi. Planning information analysis.
4. Data Collection Process:
This process includes field work and desk work for collecting all relevant data and information. Field work includes interviewing the personals by interacting them face to face by visiting them in home or offices or arranging group meetings at any preferred place. Desk work includes contacting personals over telephone or via series of emails and web meetings. This could take comparatively more time as compared to the field work. Involving experienced and trained executive for this helps in reducing data collection errors.
5. Data Preparation, Tabulation and Analysis of Results:
After the data collecting stage the collected data is edited, corrected if required and validated. This process is the most important process in the research as the results are generated on the basis of data preparation. So it is required for an organization to verify the authenticity of the collected data and edit or correct it if needed. The final data is then segmented according to the business standards and inserted into the CRM database in a more tabulated form so that search or combination could be made easily.
6. Presentation and Report Generation:
The entire process is properly documented with respect to organizational standards so that it can be referred in future for decision making process or to change or modify any specific process or module. This document contains overall architecture of the project depicting all the processes with the help of tables, graphs and figures to provoke impact and clarity.
Market Research undeniably plays a vital role in exploring the business. The above process if conducted in an efficient manner could help predicting and correlating customer needs and then modeling or modifying the business strategies accordingly.
Steps Followed while Conducting Marketing Research Process
Marketing Research is the project specific systematic gathering of data in the search scanning mode. Marketing research can be taken up in-house team of the global firm or outsourced to outside firms specialized in marketing research.
The following steps are followed while conducting marketing research:
1. Problem Definition – The purpose of the study, background and required information, and decision making usage of the information is detailed. Defining the research problem to be addressed is the most important step because all other steps will be based on this definition.
2. Developing an Approach to the Problem – A broad specification of how the problem will be addressed is developed to allow the researcher to break the problem into salient issues and manageable pieces. Required information is identified. This step is guided by discussions with decision makers, industry experts, along with secondary data analysis, qualitative research and pragmatic considerations.
3. Research Design Formulation – Framework/blueprint for conducting the Marketing Research project is prepared. The design can be descriptive, experimental, observational or simulation. International research is of a descriptive nature or observational. The ability to conduct simulations or experiments depends on the sophistication of the market and the research facilities available.
4. Fieldwork or data collection – A properly selected and trained field force gathers project data through personal interviewing, telephone, mail or electronically.
5. Data preparation and analysis – Data collected is edited, coded, transcribed and verified to allow researchers to derive meaning from the data.
6. Report preparation and presentation – The research findings are documented and presented to decision makers through written reports and presentations. The report should address the specific research questions identified, describe approach, research design, adopted data collection and data analysis procedures and conclude the results and major findings.
7 Important Steps Involved in Carrying out Marketing Research Process
The important steps involved in carrying out research are as follows:
1. Definition of the problem.
2. Conducting of a situational analysis.
3. Conducting of an informal study.
4. Formulation of the research design.
5. Collection of information.
6. Analysis and interpretation of data.
7. Presentation of research findings.
1. Definition of the Problem:
The first step in the marketing research project is the definition of the research problem. This means that the objective or purpose of the research study should be clearly laid down. This is necessary to give a clear direction to research and avoid confusion. This is necessary to help collect the required information, avoid gathering irrelevant information, analyse and interpret data in the proper perspective and to make the best use of the time and other resources.
2. Situational Analysis:
The situational analysis is particularly important when marketing research is conducted by an outside agency, because the situational analysis is meant to familiarise the researcher with the company and its environment and thereby make the problem more clear to the researcher. The researcher analyses the situation by obtaining the relevant information about the company, its competitors and other relevant environmental factors.
Situational analysis may help to define the research problem more clearly. It may also enable the formulation of the research hypothesis. A hypothesis is a tentative supposition or conclusion which will be tested by research. For example, the situational analysis may give an indication that the reason for the failure of a new product is the ineffectiveness of promotion (the target consumers might not have got the full message of the product).
A hypothesis may then be formulated that the reason for the product failure is the program promotion and this hypothesis may be tested by research. The research findings may prove or disprove the hypothesis.
3. Informal Investigation:
This step is indeed an extension of the previous step. While the situational analysis was largely confined to information from company sources (and also library where needed), in this stage, the researcher gather information from external sources such as – competitors, middlemen, advertising agencies, customers etc.
In the case of some research problems, the needed information will be obtained by this step so that it will not be necessary to continue the research. If the informal investigation reveals the need for a further investigation, the next step will have to be taken, i.e., formulating a research design.
4. Research Design:
“A research design is the specification of methods and procedures for acquiring the information needed. It is the overall operational pattern of framework of the project that stipulates what information is to be collected from which sources and by what procedures. If it is a good research design, it will ensure that the information obtained is relevant to the questions and that it was collected by objective and economical procedures.”?
A research design, thus, specifies:
i. The type of information required.
ii. The sources of the information.
iii. The methods or techniques of data collection broadly, there are two sources of information, viz. –
a. Secondary sources, and
b. Primary sources.
Secondary data are data which have already been gathered by somebody else and are available to others for use. Such data may be available in published or unpublished form. Books, journals, periodicals, newspapers, reports, theses, dissertations, term papers, papers presented in the seminars and symposia, etc., are sources of secondary data.
A researcher should first try to find out whether reliable and sufficient secondary data are available. If reliable and sufficient secondary data are available, there is no need to collect primary data. Secondary data are normally quick and cheap whereas primary data are time-consuming and costly to collect.
Primary data, as the term indicates, are first-hand data collected by the researcher (or his assistants). It may be noted that even some of the primary data may be unreliable.
5. Collection of Data:
The research design specifies the data requirements, sources of- methods of data collection and the sampling technique and the sample size. After these things have been specified, it may be necessary to prepare data collection forms like questionnaires/schedules. It may also be necessary to pre-test the questionnaire before the data collection starts in real earnest to ensure that the questions are clear and do not cause embarrassment to the respondents.
6. Processing, Analysis and Interpretation of Data:
The raw data have to be processed and presented in an appropriate form like tables to make them easily amenable to analysis. Analysis should be followed by interpretation which includes expressing the findings in more meaningful terms like percentages and drawing useful inferences from them. However, perfect the data collection maybe, they will not be of any-significant use unless they are properly analysed and interpreted.
7. Presentation of Findings:
The research findings should be presented in an appropriate form (like a report, for example). The type of presentation to be made depends on a number of factors like the nature of research, its purpose and use, the persons who use them, etc. The findings should be presented in a form and language that will be easily understood by the people who use them. If the research report is very lengthy, a summary of the report should also be included in the report.
Principal Steps to be Taken in Marketing Research Process
Mere collection of information does not complete marketing research. The information must be collected and processed in a scientific manner to make it more meaningful and useful. It is here that marketing research is applied and it calls for a high degree of competence and training.
There are seven principal steps that are to be taken in this process:
1. Problem Formulation:
The precise definition of the problem helps in determining the techniques to be used, the extent of information to be collected, etc. Simply stated, one should be clear in his mind what is exactly required. Marketing elements of the problem should be isolated and identified in most precise terms.
2. Decision on Fact-Gathering Procedure:
After defining the problem the second step is to find out the best procedure for getting the information. In technical language, this is known as planning the research technique.
The procedure requires the following steps:
(a) Establishing the facts that are available at present and the additional facts required;
(b) Determining the reliable data; and
(c) Setting an organisation for the collection of additional information required.
3. Data Collection:
When the available data are insufficient, fresh data have to be collected. Usually ‘Survey’ techniques are used for gathering information. It need not be an elaborate survey, for a sample survey would be quite sufficient. This is the method of obtaining information from a sample of respondents (groups). The sample is supposed to represent a larger group of people, i.e., the universe, sometimes all the people.
4. The Marketing Sample:
The sample is a small group taken from the total group. The total may be a city, a State, a nation or the whole world. Sampling is essential to substantiate and interpret the data.
5. Data Evaluation:
Locating the source and collecting the information is only a part of the job. The data collected cannot be simply accepted because they might contain unnecessary and/or over or under-emphasised facts. The remark “Figures do not lie, but liars figure” is apt here. For, from the same set of facts, different interpreters will draw different conclusions, depending upon their individual viewpoints, their interests and their individual biases.
6. Interpreting the Data:
This is an important stage in the process of research. Correct interpretation of data makes the research meaningful and purposeful. It is at this level that unorganised and unscientific research fails. The best fact-finding study would become useless by wrong or improper interpretation of facts. Technical competence, broad understanding, intimate knowledge of the problem at hand are some of the prerequisites for the correct interpretation of the data.
7. Report Preparation:
The final step in marketing research is summarising the result of research and making a report. The findings and recommendations are put in such a manner that the recipient of the report can understand them clearly enough to use them effectively.
In general, the reports are classified into four kinds:
i. Executive Report – This report is meant for an executive to carry out the plan as quickly as possible. He need not interpret the facts once again and make a thorough study of it.
ii. Technical Report – Such a report will contain the statement of the problem, the methods used in the research (methodology, the proof of the findings, etc.). The sole purpose of the technical report is to collect and present necessary technical information.
iii. Data Report – It is a peculiar report for it does not contain any interpretation. It merely presents the findings in tables and charts, but does not seek to interpret what these findings or data mean. For example, it may give the sales volume in a particular area for different periods without adding any reason for their fluctuations.
iv. Popular Report – It is also known as persuasive report. It is non-technical and hence of no value in commercial field. Narration of an incident is a kind of persuasive report.