Ch 4Managing Marketing Insights to Gain

Customer Information
04/17/2015
Customer Insight
Fresh understanding of customer and the market derived
from marketing information
Used to develop competitive advantage
Market Information System (MIS)
Consists of people and procedures to:
o Assess info needs
o Develop needed info
o Help decision makers to use the info to generate and
validate actionable customer and market insights
Assessing Marketing Info Needs
A GOOD MIS balances info users would like to have against:
o What they really need
o What is feasible to offer
Obtaining, analyzing, storing and delivering information using an
MIS is expensive
o Worth the cost?
Developing Marketing information
Obtained from
o Internal databases
o Competitive marketing intelligence Marketing Research
Internal Databases
Electronic collections of consumer and market information
within a companys network

Advantage: Information can be accessed quickly and economically

Disadvantage:
o Data ages rapidly and can be incomplete
o Maintenance and storage of data is expensive
Competitive Marketing Intelligence
Systematic collection and analysis of information
o About consumers, competitors and developments in the
marketing environment
Techniques:
o Observing consumers
o Quizzing employees
o Benchmarking competitors products
Advantages:
o Gain insights about consumer opinions and association with
the brand
o Gain early warning of competitor strategies, new product
launches, and potential competitive strengths and
weaknesses
o Help firms to protect their own information
Disadvantages:
o May involve ethical issues
Marketing Research
Systematic design, collection, analysis and reporting of data
Approaches followed by firms:
o Use own research departments

o Hire outside research specialists

o Purchase data collected by outside firms
The Marketing Research Process

Defining the Problem & Research Objectives (1)

Exploratory Research
o Gather preliminary info
o Helps define problems and suggest hypotheses
Descriptive Research
o Used to better describe the market potential for a product or
the demographics and attitudes of consumers
Causal Research
o Used to test hypotheses about cause-and-effect relationships
Research Plan (2)
Outlines sources of existing data
Spells out:
o Specific research approaches
o Contact Methods
o Sampling Plans
o Instruments that researchers will use to gather new data
Should be presented in a written proposal
Topics covered in a research plan:

o Management probs and research objectives

o Info to be obtained
o How the results will help managements decision making
o Estimated research costs
o Type of data required
Secondary Data
Information that already exists that was collected for
another purpose
Sources: Companys internal database or purchases from outside
suppliers
Advantages:
o Can be obtained quickly and at low costs
o Can provide data that an individual company cannot collect on
its own
Disadvantages:
o Researchers may not get all data needed
o Info may not be very usable
Primary Data
Information collected for the specific purpose at hand
Planning Primary Data Collection

Research Approaches
Observational Research
o Gather primary data by observing relevant people, actions
and situations

o Ethnographic Research
Sending trained observers to watch and interact with
consumers in their natural environments
Survey Research
o Asking people questions about their knowledge, attitude, and
preferences and buying behavior
o Flexible
Experimental Research
o Selecting matched groups of subjects, giving them different
treatments, controlling related factors, and checking for
differences in group responses
o Best for gathering causal info
Contact Methods:
Mail questionnaires are used to collect large amounts on info at a
low cost per respondent
o Pro: Response rate
o Con: Flexibility
Telephone interview gathers info quickly, while providing
flexibility
o Pro: Control of sample
o Con: Response Rate
Personal Interviewing:
o Individual interviewing
Talking with people in their homes or offices (Flexible,
but costly)
o Group interviewing (Focus group)
6-10 people meet with trained moderator to talk about
a product
Online Marketing Research

Primary data is collected through

o Online Surveys
Quickest collection and compilation
o Online Focus Groups: Focus group interviewing conducted
online
o Web-based experiments
o Tracking consumers online behavior
Online Behavioral & Social Tracking and Targeting
Online listening
o Provides the passion and spontaneity of unsolicited consumer
opinions
Behavioral targeting
o Uses online consumer tracking data to target advertisements
and marketing offers to specific consumers
Social targeting
o Mines individual online social connections and conversations
from social networking sites
Sampling Plan
Sample: Segment of the population selected to represent the
population as a whole
Decisions required for sampling design:
o Sampling UnitPeople to be studied
o Sample sizeNumber of people studied
o Sampling ProcedureMethod of choosing people to be studied
Types of Samples
Probability Samples

o Simple random sample

Everyone has equal chance of selection
o Stratified random sample
Divided into mutually exclusive groups and samples
drawn from each group
o Cluster sample
Divided into mutually exclusive groups and researcher
draws a sample of the groups to interview
Nonprobability samples
o Convenience sample
Selects easiest population to obtain info from
o Judgment sample
Uses judgment to select people good for accurate info
o Quota sample
Interviews prescribed number of people in each of
several categories
Research Instruments
Questionnaires can be administered in person, by phone, email or
online
o Closed-end questions
Limited answers; easier to interpret
o Open-end questions
What people think; useful in exploratory research
Mechanical instruments for research include:
o People meters

o Checkout scanners
o Neuromarketing
Measuring brain activity to learn how consumers feel
and respond
Implementing the Research Plan (3)
Data collection
o Researchers should guard against various probs
Interacting with respondents
Quality of responses
Interviewer mistakes or shortcuts taken
Processing the data
o Check for accuracy
o Code for analysis
Analyzing the data
o Tabulate results
o Compute statistical measures
Interpreting and Reporting Findings (4)
Responsibilities of the market researcher:
o Interpret findings
o Draw conclusions
o Report findings to management
Responsibilities of managers and researchers

o Work together closely when interpreting research results

o Share responsibility for the research process and resulting
decisions
Customer Relationship Management (CRM)
Managing detailed info about individual customers
Carefully managing customer touch points to maximize customer
loyalty
Consists of software and analytical tools that:
o Integrate customer info from all sources
o Analyze data in depth
o Apply the results
Marketing Research in Small Business and NGOs
Obtaining good marketing insights
o Secondary data collection
o Observation
o Surveys
o Experiments
International Marketing Research
Problems faced include:
o Diverse markets
o Finding good secondary data in foreign markets
o Developing good samples
o Reaching respondents

 The cost of research is high but cost of not doing it is higher

Intrusions on Consumer Privacy
Failure to address privacy issues results in:
o Angry, less cooperative consumers
o Increased government intervention
Best approach:
o Ask only for info needed
o Using the info responsibly to provide customer value
o Avoiding sharing the info w/o customers permission
Misuse of Research Findings
Few advertisers rig their research designs or deliberately
misrepresent the findings
Solutions:
o Development of codes of research ethics and standards of
conduct
o Companies must accept responsibility to protect consumers
best interests and their own