Chapter review concepts and key themes

Marketing Research Questions

1. Describe the typical steps in the market research process

Market research is the systematic process of collecting, analyzing and interpreting data pertaining to market conditions (Clow & James, 2013). It comprises of five steps. The first of these is the problem definition, which involves clarifying the overarching opportunity or problem, such as why a product is losing market share or the best strategy for launching a new product to a target population (Clow & James, 2013). In the problem definition step, the researcher carries out focus group discussions, interviews, estimations, simple observation, and physical assessments to ascertain that a problem exists and needs to be addressed. By the end of step one, the researcher has identified that a problem exists, developed the research objectives, and formulated hypotheses.

The second step involves determining the methods and techniques to be used in gathering relevant data that will provide answers to the research questions (Clow & James, 2013). This step involves developing the research design, and has to do with determining what type of data to collect (primary or secondary), methods of collecting data (surveys, interviews, observation), sampling procedures, sample size, and designing the questionnaire or interview guide (Clow & James, 2013). The plan developed in this step sets out the research techniques that will be used to answer the research question.

The third step is data collection, which is the actual collection of research data using the tools and techniques identified and developed in the preceding step. The researcher will collect either quantitative or qualitative data, depending on the research objectives. Quantitative data is in the form of numbers, while qualitative data is descriptive and observational (Clow & James, 2013). A common technique of collecting market data is interviewing customers, either face-to-face or by phone to obtain their views on say, the pricing or quality of a certain product or the unmet needs in a certain market (Clow & James, 2013). Alternatively, the researcher could distribute questionnaires to customers, which they would fill and give back to the researcher. Data collection is crucial as it informs the generation of insights on a company’s marketing strategy (Clow & James, 2013).

The fourth step is the analysis of the collected data. This step involves organizing, reviewing, verifying, and interpreting data (Clow & James, 2013). The researcher, focuses on identifying trends and patterns in the data, and then using these to answer the research questions. Market research often involves collecting a large amount of data and as such, analysis requires the use of software that can easily depict patterns and trends in the data (Clow & James, 2013).

The last step is the development of a report (Clow & James, 2013). The report plays a two-fold role: a) summarizing the research findings and b) developing action plans in view of the findings (Clow & James, 2013). Market research is conducted with a certain goal in mind. For instance, a company may conduct market research to determine why a certain product is losing its market share. From the analyzed data, it may emerge that the product faces stiff competition from substitute products that are more affordable. In the report, the researcher will summarize these findings and recommend strategies (action plans) for improving market share, such as price reductions or advertising that emphasizes the quality of the product.

2. Identify and describe the two approaches for creating a perceptual map

In basic terms, a perceptual map could be conceptualized as a representation (visual) of customer discernment regarding the various aspects, characteristics, or features of a product or service. The map could make it possible for one to assess how strong competing products are from the perspective of customers. Essentially, perceptual maps could be created using two approaches, i.e. the attribute-based approach and the attribute-free approach. In as far as the attribute-based approach is concerned, respondents are called upon to assess certain attributes of a selected brand or product. On the other hand, the attribute-free approach, as Blythe (2013) point out, calls upon respondents to “provide an overall evaluation of each brand, which is used to derive spatial positions in a multidimensional space that reflect these perceptions” (p. 119).

Each of the two approaches has its unique strengths and weaknesses. For instance, although the attitude-based approach could come in handy in competitive analysis, it requires greater effort on the part of the respondent and could be confusing in those scenarios whereby there are many attributes to be taken into consideration. On the other hand, when it comes to the attribute-free approach, respondents are not necessarily called upon to deploy a great deal of effort as only overall brand perception is required. However, in this case, it is difficult to establish the specific attributes that are behind the evaluations of respondents.

3. Explain the purpose of a conjoint study

A conjoint analysis is a form of statistical analysis in market research that focuses on determining how customers value different attributes of a service or product (Clow & James, 2013). For instance, a company could conduct an analysis to determine the extent to which customers value the benefits, function, or features of a product (Clow & James, 2013). Customers may prefer one product for its function, and another for its features (such as the color). Thus, a conjoint analysis is a statistical technique for measuring the value that customers place on the attributes of a product. Its core purpose is to help companies understand how customers value different components of their services or products so as to know where their competitive advantage lies. Further, conjoint analysis helps to inform a company’s research and development plans, sales and marketing efforts, and pricing strategy (Clow & James, 2013). For instance, insights obtained from conjoint analysis can be used to determine what new features could be added to a product or service to make it more appealing and how to organize advertisements to emphasize the attributes that customers value most.

4. Explain the difference between internal and external validity and identify what types of studies have advantages for each one

Internal validity is the confidence that the results of a study are attributable to the independent variable and not some other rival explanations. In other words, internal validity is the extent to which changes in the dependent variable are caused by the independent variable and not some other external factors (Alexander, 1992). Internal validity is a result of the processes undertaken in carrying out research. External validity, on the other hand, is the extent to which the findings of a research study can be generalized to the whole population. Experimental studies carried out in laboratory settings are high in internal validity because the researcher is able to manipulate the independent variable to minimize the effect of external factors (Alexander, 1992). However, empirical studies carried out in the real world setting have higher external validity because they take into account the external factors that, although are not included in the study, influence the dependent variable. As such, the findings from these studies are more generalizable to the population.