Jewels of Marketing Research – The Path Unexplored
The purpose of this article is to provide better insights and
current trends happening in the world in terms of market research development.
The article would provide the understanding of nature and scope of market
research. The article will also discuss significant factors concerned in diverse
managerial decision problems and defining research objectives plus the
methodologies used in marketing research. The aim of this paper is to focus on
various techniques- qualitative as well as quantitative used in evaluating a
research plan and putting in shape. This article will take practitioners’ view
with an example of McDonalds in
understanding the complexities involved in whole process of market research.
Introduction
Since inception of
mankind, marketing research has continuously been influencing each and every
aspects of human life. To better understand the world, to explore the
opportunities and to make an edge over competitors could not have been possible
without efficient market research.
Market Research has
undergone unprecedented developments during last few decades. Last two decades
has experienced a drastic shift in the thought process involved in effective
market research on a global basis. Several organizations emerged and succeeded
due to efficient market research approach. These organizations have lived up to
the expectations of consumers and satisfying their needs and wants.
Forgotten roots of Marketing Research
Looking into the
annals of history, idea of marketing research was first conceptualized by
Daniel Starch by the use of advertising, as an offshoot of the innovation of
golden radio age in United States. Daniel emphasized that an effective
advertising should be seen, read, believed, remembered, communicated and then
acted upon.
People started
following this ideology and tried implementing in the daily life. Soon, this
definition took a broader perspective in terms of decisional issues, research
objectives and methods of research. Through “aided recall”, market research is
defined as the ways of quenching the needs and wants of consumers and
satisfying their expectations from the market.
Defining Marketing Research
“Market research is
the methodology of conveying the information about the consumer to the marketer
via collecting, analysing and processing information.”
Components of Market Research
Market research
primarily uses three broad components to address the management decision making
problems.
Example
Suppose McDonalds
India is thinking on launching a new product line in the beverages category and
improve the quality content of fast foods served to customers visiting or
ordering from McDonalds. This forms the management decision problem that
whether McDonalds should invest in new product line and what should be done to
improve the quality content of food served.
Market research
objectives would include as how much sales would be generated in introducing a
new product line, what would be the turnover, what consumers to target, how
promotion strategy for new product line be launched, how the trade off between
quality and taste should be maintained, how to gain an edge over competitors
who are there in the new product line since years.
Need and Importance of Market
research
Vital need of market
research approach could be easily witnessed in the interaction between
organization and its customers. Identifying the problems associated with
customers and then putting the solution could only be possible through
efficient and effective market research.
Market research has
got its wide importance in current market trends and exploring the needs of
customers.
1.
Provide better products and offerings through in-depth market
research and understanding the consumer needs.
2.
Launching of effective market plan to optimise the research and
its components.
3.
Explore the opportunities and gain the first mover advantage.
4.
Understanding reaction of customers with respect to change in
the price and quality of products.
5.
Feedback from customers to gain an edge over competitors.
6.
Satisfaction level of customers with the current offerings.
7.
Service representatives hearing from customers.
In the example
mentioned in the article, market research would be vital in capturing the
insights and feedback, responses for the new product line and what changes
should be introduced to improve the product and quality of food served.
Components of Market Research
Market research could
help organizations with its two strands:
1.
Problem Identification research
2.
Problem Solving research
Each of these strata
could be further categorized into several sub divisions which are shown below:
Under problem
identification comes:
-
Forecasting demand
-
Sales Analysis
-
Market potential
-
Share analysis
Under Problem Solving
comes:
-
Product research
-
Pricing research
-
Promotion research
-
Segmentation research
In the above mentioned
example, McDonalds should identify the critical areas before launching new
product line in any place. McDonalds should identify the potential of the
market, should put some stress testing to analyse the market. McDonalds should
setup price according to the purchasing power of the income group of that area.
Market Research process
After defining
research problem, exploratory research could be used to gain the insights of
consumers towards McDonalds fast food servicing. Causal research could be used
to determine the cause and effect of changing product or price of the food item
on the customer. Descriptive research through in store-surveys, test marketing,
pilot test could be conducted for getting an estimate of the customer visiting
McDonalds.
Hypothesis Design
Hypothesis is a
general assumption which could be validated after gaining the insight from
consumers and checking the level of confidence in the sample analyzed.
Hypothesises are checked against the alternative through various confidence
level techniques and normalization process.
In our example,
Hypothesis can be sales turnover would grow up with the introduction of new
product line during weekends with some confidence level. Other hypothesis could
be quality level would increase in production demand of McDonalds food products
at global level with 99 percent confidence level.
Sampling
McDonalds can use
stratified random sampling to focus on particular segment according to age
group, according to opening of new product line in metros and rural areas.
Scaling and Measurement
Scaling and
measurement could be carried out to determine the preference or propensity of
the customer towards particular items of market research. Various scales such
as nominal, ordinal, interval and few high precision scales Likert 5-pointer
and 7-pointer scales could be used.
In order to identify
and measure the response of customer towards quality content and new product
line introduction, McDonalds generally uses 7-pointer Likert scale and interval
scale.
Data Collection and Analysis
Various models of data
collection can be deployed to collect data. Data collection in form of
qualitative and collective measure can be used. Questionnaire design, face to
face interviews, mall interviews, focus group assessment could be the ways of
collecting data.
Data Analysis could be
done through various software packages to check the level of significance and
presence of outliers in the data. SPSS software, ANOVA, Chi-Square Test are the
options for carrying out fine tuning of data collected.
Final Report
Complete market
research report should be well documented and should have addressed all the
major areas related to issues.
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