CHAPTER 2

Defining the Marketing Research Problem and Developing an Approach

TASKS INVOLVED
i. Discussions with decision makers
 understand the capabilities and limitations of the research.
 Understand that research doesn’t provide solution.
 Require considerable skill to the researcher.
TASKS INVOLVED
ii. Interviews with Industry Experts
 May help to formulate the research problem
 Preferred way to collect data from experts is personal interview.
 Two potential difficulties may arise while interviewing experts
1. some claim to be knowledgeable.
2. Difficult to locate and obtain help from experts from outside experts.
TASKS INVOLVED
iii. Secondary data analysis
 Primary data vs. secondary data

Secondary data is
 economical and
 Source of background information.
TASKS INVOLVED
iv. Qualitative Research
 Is unstructured
 Is exploratory
 Provides in-depth understanding

Some popular qualitative techniques are

 Focus group
 Depth interview
 Case studies
ENVIRONMENTAL CONTEXT OF THE PROBLEM
• Understand the client’s firm and industry
• Analyze the relevant factors
• Environment context may include
ENVIRONMENT CONTEXT OF THE PROBLEM
ENVIRONMENTAL CONTEXT OF THE PROBLEM
i. Past information and forecasts
 Analyze the trends of sales, market share, profitability, technology and lifestyle
 May uncover potential opportunities

ii. Resources and Constraints

 Analyze the resources available
 Evaluate the potential constraints
ENVIRONMENTAL CONTEXT OF THE PROBLEM
iii. Objectives
 Understand the organizational objectives
 Discern the personal objectives of the decision maker

iii. Buyer Behavior

 Factors that should consider:
 The number and geographical location of the customers
 Demographic and psychographic characteristics
 Product consumption habits
 Price sensitivity
 Buyer preferences
ENVIRONMENTAL CONTEXT OF THE PROBLEM
iv. Legal Environment
 Includes public policies, laws, government agencies and pressure groups
 Includes areas, for instance, patents, trademarks, trade agreements, taxes and tariffs.
v. Economic Environment
 Comprises purchasing power, gross income, savings and credit availability.
ENVIRONMENTAL CONTEXT OF THE PROBLEM
v. Marketing and Technological Skills
 Influence marketing programs and strategies
MANAGEMENT DECISION PROBLEM VS.
MARKETING DECISION PROBLEM

Management Decision Problem Marketing Decision Problem

• Asks what the decision maker needs • Asks what information is needed and
to do how it should be obtained
• Action oriented • Information oriented
• Focuses on symptoms • Focuses on the underlying causes
MANAGEMENT DECISION PROBLEM VS.
MARKETING DECISION PROBLEM (EXAMPLE)

Management Decision Problem Marketing Decision Problem

I. Should a new product be I. To determine consumer preferences
introduced? and purchase intentions for the
proposed new product
II. To determine the effectiveness of the
current advertising campaign
II. Should the advertising campaign be
III. To determine the price elasticity of
changed?
demand and the impact of price
changes
III. Should the price of the brand be
increased?
COMPONENTS OF THE APPROACH
I. Objective/theoretical Framework
II. Develop Model
III. Research Questions
IV. Hypotheses
V. Specification of the information needed
COMPONENTS OF AN APPROACH
i. Objective/theoretical Framework: Research should be based on objective evidence and
supported by the theory.

a. Conceptualizing and identifying key variables

b. Operationalizing key variables
c. Selecting a research design
d. Selecting a sample
e. Analyzing and interpreting data
f. Integrating findings
COMPONENTS OF AN APPROACH
ii. Develop Model: Three types of model are used:
a. Verbal model: The variables and their relationships are stated in prose form.
b. Graphical model: They are visual. They isolate variables and suggest directions of the
relationships.
c. Mathematical model: They specify relationships among variables, usually in equation
form.
COMPONENTS OF AN APPROACH
 Research Questions are the refined statements of the specific components of the problem
 Hypothesis is an unproven statement that is an interest to the researcher. Most often,
hypothesis is a possible answer to the research question
 RESEARCH QUESTIONS AND HYPOTHESES

RQ1: Do the customers of Sears exhibit brand loyalty?

This research question can be broken into:-

H1: Store loyal customers are less knowledgeable about the

shopping environment
H2: Store loyal customers are more risk averse than non-loyal
customers
RESEARCH QUESTIONS AND HYPOTHESES
RQ1: Can the motorcycle buyers be segmented based on psychographic characteristics?

H1: There are distinct segments of motorcycle buyers.

H2: Each segment is motivated to own a Harley for a different reason.
H3: Brand loyalty is high among Harley-Davidson customers in all segments.