{"id":7136,"date":"2016-09-29T17:02:12","date_gmt":"2016-09-29T17:02:12","guid":{"rendered":"https:\/\/courses.lumenlearning.com\/masterybusiness2xngcxmasterspring2016\/?post_type=chapter&#038;p=7136"},"modified":"2024-05-03T15:43:33","modified_gmt":"2024-05-03T15:43:33","slug":"the-marketing-research-process","status":"publish","type":"chapter","link":"https:\/\/courses.lumenlearning.com\/wm-introductiontobusiness\/chapter\/the-marketing-research-process\/","title":{"raw":"The Marketing Research Process","rendered":"The Marketing Research Process"},"content":{"raw":"<div class=\"textbox learning-objectives\">\r\n<h3>Learning Outcomes<\/h3>\r\n<ul>\r\n \t<li>Explain the process and goal of market research<\/li>\r\n \t<li>Explain how market research helps marketers validate their target markets<\/li>\r\n<\/ul>\r\n<\/div>\r\nMarketing research is a useful and necessary tool for helping marketers and an\u00a0organization's executive leadership make wise decisions. Carrying out marketing research can involve highly specialized skills that go deeper than the information outlined in this module. However, it's important for any marketer to be familiar with the basic procedures and techniques of marketing research.\r\n\r\nIt's very likely that at some point a marketing professional will need to supervise an internal marketing research activity or to work with an outside marketing research firm to conduct a research project. Managers who understand the research function can do a better job of framing the problem and critically appraising\u00a0the proposals made by research specialists. They are also in a better position to evaluate their findings and recommendations.\r\n\r\nPeriodically marketers themselves need to find solutions to marketing problems without the assistance of marketing research specialists inside or outside the company. If you are familiar with the basic procedures of marketing research, you can supervise and even conduct a reasonably satisfactory search for the information needed.\r\n\r\n[caption id=\"attachment_13750\" align=\"aligncenter\" width=\"750\"]<a href=\"https:\/\/s3-us-west-2.amazonaws.com\/courses-images\/wp-content\/uploads\/sites\/3006\/2016\/09\/31230442\/TheMarketingResearchProcess.png\" target=\"_blank\" rel=\"noopener\"><img class=\"wp-image-13750\" src=\"https:\/\/s3-us-west-2.amazonaws.com\/courses-images\/wp-content\/uploads\/sites\/3006\/2016\/09\/31230435\/TheMarketingResearchProcess.jpg\" alt=\"Steps of the Marketing Research Process: 1. Identify the problem (this includes identifying the problem to solve, project objectives, and research questions). 2. Develop the research plan (What information is needed? What research &amp; sales methods will you use? Who are the responsible parties?). 3. Conduct research (this includes a secondary data review, primary data collection, and using suitable methods and techniques. 4. Analyze and report findings (this includes data formatting and analysis, interpretation of results, and reports and recommendations. 5. Take action (this includes thought and planning, evaluation of options, course adjustment and execution.\" width=\"750\" height=\"442\" \/><\/a> Click on the image for a larger view.[\/caption]\r\n<h2>Step 1: Identify the Problem<\/h2>\r\nThe first step for any marketing research activity is to clearly identify and define the problem you are trying to solve. You start by stating the marketing or business problem you need to address and for which you need additional information to figure out a solution. Next, articulate the objectives for the research: What do you want to understand by the time the research project is completed? What specific information, guidance, or recommendations need to come out of the research in order to make it a worthwhile investment of the organization's time and money?\r\n\r\nIt's important to share the problem definition and research objectives with other team members to get their input and further refine your understanding of the problem and what is needed to solve it. At times, the\u00a0problem you really need to solve is not the same problem that appears on the surface. Collaborating\u00a0with other stakeholders helps refine your understanding of the problem, focus your thinking, and prioritize what you hope to learn from the research. Prioritizing your objectives is particularly helpful if you don't have\u00a0the time or resources to investigate everything you want.\r\n\r\nTo flesh\u00a0out your understanding of the problem, it's useful to begin brainstorming actual\u00a0research questions you want to explore. What are the questions you need to answer in order to get to the\u00a0research outcomes? What is the missing information that marketing research will help you find? The goal at this stage is to generate a set of preliminary, big-picture questions that\u00a0will frame your research inquiry. You will revisit these research questions later in the process, but when you're getting\u00a0started, this exercise helps clarify the scope of the project, whom you need to talk to, what information may already be available, and where to look for the information you don't yet have.\r\n<div class=\"textbox examples\">\r\n<h3>Marketing Research for Bookends<\/h3>\r\n<div class=\"wp-nocaption wp-image-2804 aligncenter\"><img class=\"aligncenter wp-image-2804\" src=\"https:\/\/s3-us-west-2.amazonaws.com\/courses-images-archive-read-only\/wp-content\/uploads\/sites\/903\/2015\/12\/23225634\/930136784_ab4699e678_b-1024x768.jpg\" alt=\"A man sitting in a bookstore\" width=\"451\" height=\"338\" \/><\/div>\r\nYour uncle\u00a0Dan owns an independent bookstore called Bookends, and it's not doing very well. (That\u2019s you in the picture.) The store's sales are down, and the rent is going up. Dan has turned to you for help, since you know a thing or two about marketing.\r\n\r\nYou need a lot of information if you're going to help your uncle\u00a0turn things around, so marketing research is a good idea. You begin\u00a0by identifying the problem and then work to set down your research objectives and initial research questions:\r\n<div class=\"aligncenter\">\r\n<table><caption>Identifying Problems, Objectives, and Questions<\/caption>\r\n<tbody>\r\n<tr>\r\n<th scope=\"row\">Core business problem Dan needs to solve<\/th>\r\n<td style=\"width: 70%;\">How to get more people to spend more money at Bookends<\/td>\r\n<\/tr>\r\n<tr>\r\n<th scope=\"row\">Research objectives<\/th>\r\n<td>1) Identify promising target audiences for Bookends; 2) Identify strategies for rapidly increasing revenue from these target audiences<\/td>\r\n<\/tr>\r\n<tr>\r\n<th scope=\"row\">Initial research questions<\/th>\r\n<td>Who are Bookends' current customers? How much do they spend? Why do they come to Bookends? What do they wish Bookends offered? Who isn't coming to Bookends, and why?<\/td>\r\n<\/tr>\r\n<\/tbody>\r\n<\/table>\r\n<\/div>\r\n<\/div>\r\n<h2>Step 2:\u00a0Develop a Research Plan<\/h2>\r\nOnce you have a problem definition, research objectives, and a preliminary set of research questions, the next step is to develop a research plan. Essential to this plan is identifying precisely what information you need to answer your questions and achieve your objectives. Do you need to understand customer opinions about something? Are you looking for a clearer picture of customer needs and related behaviors? Do you need sales, spending, or revenue data? Do you need information about competitors' products, or insight about what will make prospective customers notice you? When do you need the information, and what's the time frame for getting it?\u00a0What budget and resources are available?\r\n\r\nOnce you have clarified\u00a0what kind of information you need and the timing and budget for your project, you can develop\u00a0the research design. This details\u00a0how you plan to collect and analyze the information you're after. Some types of information are readily available through\u00a0<em>secondary research<\/em> and <em>secondary data<\/em> sources. Secondary research analyzes information that has already been collected for another purpose by a third party, such as a government agency, an industry association, or another company. Other types of information need to come from talking directly to customers about your research questions. This is known as <em>primary research<\/em>, which collects<em> primary data<\/em> captured expressly for your research inquiry.<em>\u00a0<\/em>Marketing research projects may include\u00a0secondary research, primary research, or both.\r\n\r\nDepending on your objectives and budget, sometimes a small-scale project will be enough\u00a0to get\u00a0the insight and direction you need. At other times, in order to reach the level of certainty or detail required, you may need larger-scale research involving participation from hundreds or even thousands of individual consumers. The research plan lays out the information your project will capture\u2014both primary and secondary data\u2014and describes what you will do with it to get the answers you need. (Note: You'll learn more about data collection methods and when to use them later in this module.)\r\n\r\nYour data collection plan goes hand in hand with your analysis plan. Different types of analysis yield different types of results. The analysis plan should match the type of data you are collecting, as well as the outcomes your project is seeking and the resources at your disposal. Simpler research designs tend to require simpler analysis techniques. More complex research designs can yield powerful results, such as understanding causality and trade-offs in customer perceptions. However, these more sophisticated designs can require more time and money to execute effectively, both in terms of data collection and analytical\u00a0expertise.\r\n\r\nThe research plan also specifies who will conduct the research activities, including data collection, analysis, interpretation, and reporting on results. At times a singlehanded marketing manager or research specialist runs the entire research project.\u00a0At other times, a company may contract with a marketing research analyst or consulting firm to conduct the research. In this situation, the marketing manager provides supervisory oversight to ensure the research delivers on expectations.\r\n\r\nFinally, the research plan indicates\u00a0who will interpret the research findings and how the findings\u00a0will be reported. This part of the research plan should consider the internal audience(s) for the research and what reporting format will be most helpful. Often,\u00a0senior executives are primary stakeholders, and they're anxious for marketing research to inform and validate their choices. When this is the case, getting their buy-in on\u00a0the research plan is\u00a0recommended to make sure\u00a0that they are comfortable with the approach and receptive to the potential findings.\r\n<div class=\"textbox examples\">\r\n<h3>A Bookends Research Plan<\/h3>\r\nYou talk over the results of your problem identification work with Dan. He thinks you're on the right track and wants to know what's next. You explain that the next step is to put together a detailed plan for getting\u00a0answers to the research questions.\r\n\r\nDan is enthusiastic, but he's also short on money. You realize that such a financial constraint\u00a0will limit what's possible, but\u00a0with Dan's help you can do something worthwhile. Below is the research plan you sketch out:\r\n<div class=\"aligncenter\">\r\n<table><caption>Identifying Data Types, Timing and Budget, Data Collection Methods, Analysis, and Interpretation<\/caption>\r\n<tbody>\r\n<tr>\r\n<th scope=\"row\">Types of data needed<\/th>\r\n<td style=\"width: 75%;\">1) Demographics and attitudes of current Bookends customers; 2) current customers' spending patterns; 3) metro area demographics (to determine types of people who aren't coming to the store)<\/td>\r\n<\/tr>\r\n<tr>\r\n<th scope=\"row\">Timing &amp; budget<\/th>\r\n<td>Complete project within 1 month; no out-of-pocket spending<\/td>\r\n<\/tr>\r\n<tr>\r\n<th scope=\"row\">Data collection methods<\/th>\r\n<td>1) Current customer survey using free online survey tool, 2) store sales data mapped to customer survey results, 3) free U.S. census data on metro-area demographics, 4) 8\u201310 intercept (\"man on the street\") interviews with non-customers<\/td>\r\n<\/tr>\r\n<tr>\r\n<th scope=\"row\">Analysis plan<\/th>\r\n<td>Use Excel or Google Sheets to tabulate data; Marina (statistician cousin) to assist in\u00a0identifying data patterns that could become market segments<\/td>\r\n<\/tr>\r\n<tr>\r\n<th scope=\"row\">Interpretation and reporting<\/th>\r\n<td>You and Dan will work together to comb through the data and see what insights it produces. You'll use PowerPoint to create a report that lays out significant results, key findings, and recommendations.<\/td>\r\n<\/tr>\r\n<\/tbody>\r\n<\/table>\r\n<\/div>\r\n<\/div>\r\n<h2>Step 3:\u00a0Conduct the Research<\/h2>\r\nConducting research can be a fun and\u00a0exciting part of the marketing research process. After struggling with the gaps in your knowledge\u00a0of market dynamics\u2014which led you to embark on a marketing research project in the first place\u2014now things are about to change. Conducting research begins\u00a0to generate information that helps answer your urgent marketing questions.\r\n\r\nTypically data collection begins by reviewing any existing research and data that provide some information or insight about the problem. As a rule, this is secondary research. Prior research projects, internal data analyses, industry reports, customer-satisfaction survey results, and other information sources may be worthwhile to review. Even though these resources may not answer your research questions fully, they may further illuminate the problem you are trying to solve. Secondary research and data sources are\u00a0nearly always cheaper than capturing new information on your own. Your marketing research project should benefit from prior work wherever possible.\r\n\r\nAfter getting everything you can from secondary research, it's time to shift attention to primary research, if this is part of your research plan. Primary research involves asking questions and then listening to and\/or observing\u00a0the behavior of the target audience you are studying. In order to generate reliable, accurate results, it is important to use proper scientific methods for primary research data collection and analysis. This includes identifying the right individuals and number of people to talk to, using carefully worded surveys or interview scripts, and capturing data accurately.\r\n\r\nWithout proper techniques, you may inadvertently get\u00a0bad data or discover bias in the responses that distorts the results and points you in the wrong direction. The module on Marketing Research Techniques\u00a0discusses these issues in further detail, since the procedures for getting reliable data vary by research method.\r\n<div class=\"textbox examples\">\r\n<h3>Getting the Data on Bookends<\/h3>\r\nDan is on board with the research plan, and he's excited to dig into the project. You start with secondary data, getting a dump of Dan's sales data from the past two years, along with related information: customer name, zip code, frequency of purchase, gender, date of purchase, and discounts\/promotions (if any).\r\n\r\nYou visit the U.S. Census Bureau Web site to download demographic data about your metro area. The data show\u00a0all zip codes in the area, along with population size, gender breakdown, age ranges, income, and education levels.\r\n\r\nThe next part\u00a0of the project is customer-survey data. You work with Dan to put together a short survey about customer attitudes toward Bookends, how often and why they come, where else they spend money on books and entertainment, and why they go other places besides Bookends. Dan comes up with the great idea of offering a 5 percent discount coupon to anyone who completes the survey. Although it eats into his profits, this scheme gets more people to complete the survey and buy books, so it's worth it.\r\n\r\n<img class=\"alignright wp-image-3823\" src=\"https:\/\/s3-us-west-2.amazonaws.com\/courses-images\/wp-content\/uploads\/sites\/143\/2016\/09\/21232425\/19313315520_2e9781f93a_k-1024x576.jpg\" alt=\"decorative image\" width=\"299\" height=\"168\" \/>For a couple of days, you and Dan take turns doing \"man on the street\" interviews (you interview the guy in the red hat, for instance). You find people who say they've never been to Bookends and ask them a few questions about why they haven't visited the store, where else they buy books and other entertainment, and what might get them interested in visiting Bookends sometime. This is all a lot of work, but for a zero-budget project, it's coming together pretty well.\r\n\r\n<\/div>\r\n<h2>Step 4:\u00a0Analyze and Report Findings<\/h2>\r\nAnalyzing\u00a0the data obtained in a market survey involves transforming the primary and\/or secondary data into useful information and insights that answer the research questions. This information is condensed into a format to be used by managers\u2014usually\u00a0a presentation or detailed report.\r\n\r\nAnalysis starts with formatting, cleaning, and editing the data to make sure that it's\u00a0suitable for whatever analytical techniques are being used. Next, data are tabulated to show what's happening: What do customers actually think? What's happening with purchasing or other behaviors? How do revenue figures actually add up? Whatever the research questions, the analysis takes source data and applies analytical techniques\u00a0to provide a clearer picture of what's going on. This process may involve simple or sophisticated techniques, depending on the research outcomes required. Common analytical techniques include\u00a0regression analysis to determine correlations between factors; conjoint analysis to determine trade-offs and priorities; predictive modeling to anticipate patterns and causality; and analysis of unstructured data such as Internet search terms or\u00a0social media posts to provide context and meaning around what people say and do.\r\n\r\nGood analysis is important because the interpretation of research data\u2014the \"so what?\" factor\u2014depends on it. The analysis combs through data to paint a picture of what's going on. The interpretation goes further to explain what the research data mean and make recommendations about what managers need to know and do based on the research results. For example, what is the short list of\u00a0key findings and takeaways that managers should remember from the research? What are the market\u00a0segments you've identified, and which ones should you target?\u00a0\u00a0What are the primary reasons your customers choose your competitor's product over yours, and what does this mean for future\u00a0improvements to your product?\r\n\r\nIndividuals with a good working knowledge of the business should be involved in interpreting the data because they are in the best position to identify significant insights and make\u00a0recommendations from\u00a0the research findings.\u00a0Marketing research reports incorporate both analysis and interpretation of data to address the project objectives.\r\n\r\nThe final report for a marketing research project may be in written form or slide-presentation format, depending on organizational culture and management preferences. Often a\u00a0slide presentation is\u00a0the preferred format for initially sharing research results with internal stakeholders. Particularly for large, complex projects, a written report may be\u00a0a better format for discussing detailed findings and nuances in the data, which managers can study and reference in the future.\r\n<div class=\"textbox examples\">\r\n<h3>Analysis and\u00a0Insights for Bookends: Target market validation<\/h3>\r\nGetting the data was a bit of a hassle, but now you've got it, and you're excited to see what it reveals. Your statistician cousin, Marina, turns out to be a whiz with both the sales data and the census data. She identified\u00a0several\u00a0demographic profiles in the metro area that looked a lot like lifestyle segments. Then she mapped Bookends' sales data into those segments to show who is and isn't visiting Bookends. After matching customer-survey data to the sales data, she broke down the segments further based on their spending levels and reasons they visit\u00a0Bookends.\r\n\r\nGradually\u00a0a clearer picture of Bookends' customers is beginning to emerge: who they are, why they come, why they don't come, and what role Bookends plays in their lives. Right away,\u00a0a couple of higher-priority segments\u2014based on their spending levels, proximity, and loyalty to Bookends\u2014stand out. The research has succeeded in segmenting the market into manageable targets. You and your uncle\u00a0are definitely seeing some possibilities for making the bookstore a more prominent part of their lives. You capture these insights as \"recommendations to be considered\" while you evaluate the right marketing mix for each of the\u00a0new segments you have now validated.\r\n\r\n<\/div>\r\n<h2>Step 5:\u00a0Take Action<\/h2>\r\nOnce\u00a0the report is complete, the presentation is delivered, and the recommendations are made, the marketing research project is over, right? Wrong.\r\n\r\nWhat comes next is arguably the most important step of all: taking action based on your research results.\r\n\r\nIf your project has done a good job interpreting the findings and translating them into recommendations for the marketing team and other areas of the business, this step may seem relatively straightforward. When the research results validate a path the organization is already on, the \"take action\" step can galvanize the team to move further and faster in that same direction.\r\n\r\nThings are not so simple when the research results indicate\u00a0a new direction or a significant shift is advisable. In these cases, it's worthwhile to spend time helping managers understand the research, explain why it is wise to shift course, and explain how the business will benefit from the new path. As with any important business decision, managers must\u00a0think deeply about the new approach and carefully map strategies, tactics, and available resources to plan\u00a0effectively. By making the results available and accessible to managers and their execution teams, the marketing research project can serve as an ongoing guide and touchstone to help the organization plan, execute, and adjust course as it works toward desired goals and outcomes.\r\n\r\nIt is worth mentioning\u00a0that many marketing research projects are never translated into management action. Sometimes this is because the\u00a0report is too technical and difficult to understand. In other cases, the research conclusions fail to provide useful insights or solutions to the problem, or the report writer fails to offer\u00a0specific suggestions for\u00a0translating the research findings into management strategy. These pitfalls can be avoided by paying due attention to the research objectives throughout the project and allocating sufficient time and resources to do a good job interpreting research results for those who will need to act on\u00a0them.\r\n<div class=\"textbox examples\">\r\n<h3>Bookends' New Customer Campaign<\/h3>\r\nYour research findings and recommendations identified three segments for\u00a0Bookends to focus on. Based on the\u00a0demographics, lifestyle, and spending patterns found during your\u00a0marketing research, you're able to name them: 1) Bored Empty-Nesters, 2) Busy Families, and 3) Hipster Wannabes. Dan has a decent-sized clientele across all three groups, and they are pretty good spenders when they come in. But until now he hasn't done much to purposely attract any of them.\r\n\r\nWith newly identified segments in focus, you and Dan begin brainstorming about a marketing mix to target each group. What types of books and other products would appeal to each one? What activities or events would bring them into the store? Are there promotions or particular messages that would induce them to buy at Bookends instead of Amazon or another bookseller? How will Dan reach and communicate with each group? And what can you do to bring more new customers into the store within these target groups?\r\n\r\nEven though Bookends is a real-life project with\u00a0serious consequences for your uncle Dan, it's also a fun laboratory where you can\u00a0test\u00a0out some of the principles you're learning in your marketing class. You're figuring out quickly what it's like to be a marketer.\r\n\r\nWell done, rookie!\r\n\r\n<\/div>\r\n<div class=\"textbox tryit\">\r\n<h3>Practice Questions<\/h3>\r\nhttps:\/\/assess.lumenlearning.com\/practice\/45c4d1be-17df-4976-b470-4ab9445b7620\r\n\r\nhttps:\/\/assess.lumenlearning.com\/practice\/ccfac18f-dd0c-4350-93d8-b744bc8301e1\r\n<\/div>","rendered":"<div class=\"textbox learning-objectives\">\n<h3>Learning Outcomes<\/h3>\n<ul>\n<li>Explain the process and goal of market research<\/li>\n<li>Explain how market research helps marketers validate their target markets<\/li>\n<\/ul>\n<\/div>\n<p>Marketing research is a useful and necessary tool for helping marketers and an\u00a0organization&#8217;s executive leadership make wise decisions. Carrying out marketing research can involve highly specialized skills that go deeper than the information outlined in this module. However, it&#8217;s important for any marketer to be familiar with the basic procedures and techniques of marketing research.<\/p>\n<p>It&#8217;s very likely that at some point a marketing professional will need to supervise an internal marketing research activity or to work with an outside marketing research firm to conduct a research project. Managers who understand the research function can do a better job of framing the problem and critically appraising\u00a0the proposals made by research specialists. They are also in a better position to evaluate their findings and recommendations.<\/p>\n<p>Periodically marketers themselves need to find solutions to marketing problems without the assistance of marketing research specialists inside or outside the company. If you are familiar with the basic procedures of marketing research, you can supervise and even conduct a reasonably satisfactory search for the information needed.<\/p>\n<div id=\"attachment_13750\" style=\"width: 760px\" class=\"wp-caption aligncenter\"><a href=\"https:\/\/s3-us-west-2.amazonaws.com\/courses-images\/wp-content\/uploads\/sites\/3006\/2016\/09\/31230442\/TheMarketingResearchProcess.png\" target=\"_blank\" rel=\"noopener\"><img loading=\"lazy\" decoding=\"async\" aria-describedby=\"caption-attachment-13750\" class=\"wp-image-13750\" src=\"https:\/\/s3-us-west-2.amazonaws.com\/courses-images\/wp-content\/uploads\/sites\/3006\/2016\/09\/31230435\/TheMarketingResearchProcess.jpg\" alt=\"Steps of the Marketing Research Process: 1. Identify the problem (this includes identifying the problem to solve, project objectives, and research questions). 2. Develop the research plan (What information is needed? What research &amp; sales methods will you use? Who are the responsible parties?). 3. Conduct research (this includes a secondary data review, primary data collection, and using suitable methods and techniques. 4. Analyze and report findings (this includes data formatting and analysis, interpretation of results, and reports and recommendations. 5. Take action (this includes thought and planning, evaluation of options, course adjustment and execution.\" width=\"750\" height=\"442\" \/><\/a><\/p>\n<p id=\"caption-attachment-13750\" class=\"wp-caption-text\">Click on the image for a larger view.<\/p>\n<\/div>\n<h2>Step 1: Identify the Problem<\/h2>\n<p>The first step for any marketing research activity is to clearly identify and define the problem you are trying to solve. You start by stating the marketing or business problem you need to address and for which you need additional information to figure out a solution. Next, articulate the objectives for the research: What do you want to understand by the time the research project is completed? What specific information, guidance, or recommendations need to come out of the research in order to make it a worthwhile investment of the organization&#8217;s time and money?<\/p>\n<p>It&#8217;s important to share the problem definition and research objectives with other team members to get their input and further refine your understanding of the problem and what is needed to solve it. At times, the\u00a0problem you really need to solve is not the same problem that appears on the surface. Collaborating\u00a0with other stakeholders helps refine your understanding of the problem, focus your thinking, and prioritize what you hope to learn from the research. Prioritizing your objectives is particularly helpful if you don&#8217;t have\u00a0the time or resources to investigate everything you want.<\/p>\n<p>To flesh\u00a0out your understanding of the problem, it&#8217;s useful to begin brainstorming actual\u00a0research questions you want to explore. What are the questions you need to answer in order to get to the\u00a0research outcomes? What is the missing information that marketing research will help you find? The goal at this stage is to generate a set of preliminary, big-picture questions that\u00a0will frame your research inquiry. You will revisit these research questions later in the process, but when you&#8217;re getting\u00a0started, this exercise helps clarify the scope of the project, whom you need to talk to, what information may already be available, and where to look for the information you don&#8217;t yet have.<\/p>\n<div class=\"textbox examples\">\n<h3>Marketing Research for Bookends<\/h3>\n<div class=\"wp-nocaption wp-image-2804 aligncenter\"><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter wp-image-2804\" src=\"https:\/\/s3-us-west-2.amazonaws.com\/courses-images-archive-read-only\/wp-content\/uploads\/sites\/903\/2015\/12\/23225634\/930136784_ab4699e678_b-1024x768.jpg\" alt=\"A man sitting in a bookstore\" width=\"451\" height=\"338\" \/><\/div>\n<p>Your uncle\u00a0Dan owns an independent bookstore called Bookends, and it&#8217;s not doing very well. (That\u2019s you in the picture.) The store&#8217;s sales are down, and the rent is going up. Dan has turned to you for help, since you know a thing or two about marketing.<\/p>\n<p>You need a lot of information if you&#8217;re going to help your uncle\u00a0turn things around, so marketing research is a good idea. You begin\u00a0by identifying the problem and then work to set down your research objectives and initial research questions:<\/p>\n<div class=\"aligncenter\">\n<table>\n<caption>Identifying Problems, Objectives, and Questions<\/caption>\n<tbody>\n<tr>\n<th scope=\"row\">Core business problem Dan needs to solve<\/th>\n<td style=\"width: 70%;\">How to get more people to spend more money at Bookends<\/td>\n<\/tr>\n<tr>\n<th scope=\"row\">Research objectives<\/th>\n<td>1) Identify promising target audiences for Bookends; 2) Identify strategies for rapidly increasing revenue from these target audiences<\/td>\n<\/tr>\n<tr>\n<th scope=\"row\">Initial research questions<\/th>\n<td>Who are Bookends&#8217; current customers? How much do they spend? Why do they come to Bookends? What do they wish Bookends offered? Who isn&#8217;t coming to Bookends, and why?<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n<\/div>\n<h2>Step 2:\u00a0Develop a Research Plan<\/h2>\n<p>Once you have a problem definition, research objectives, and a preliminary set of research questions, the next step is to develop a research plan. Essential to this plan is identifying precisely what information you need to answer your questions and achieve your objectives. Do you need to understand customer opinions about something? Are you looking for a clearer picture of customer needs and related behaviors? Do you need sales, spending, or revenue data? Do you need information about competitors&#8217; products, or insight about what will make prospective customers notice you? When do you need the information, and what&#8217;s the time frame for getting it?\u00a0What budget and resources are available?<\/p>\n<p>Once you have clarified\u00a0what kind of information you need and the timing and budget for your project, you can develop\u00a0the research design. This details\u00a0how you plan to collect and analyze the information you&#8217;re after. Some types of information are readily available through\u00a0<em>secondary research<\/em> and <em>secondary data<\/em> sources. Secondary research analyzes information that has already been collected for another purpose by a third party, such as a government agency, an industry association, or another company. Other types of information need to come from talking directly to customers about your research questions. This is known as <em>primary research<\/em>, which collects<em> primary data<\/em> captured expressly for your research inquiry.<em>\u00a0<\/em>Marketing research projects may include\u00a0secondary research, primary research, or both.<\/p>\n<p>Depending on your objectives and budget, sometimes a small-scale project will be enough\u00a0to get\u00a0the insight and direction you need. At other times, in order to reach the level of certainty or detail required, you may need larger-scale research involving participation from hundreds or even thousands of individual consumers. The research plan lays out the information your project will capture\u2014both primary and secondary data\u2014and describes what you will do with it to get the answers you need. (Note: You&#8217;ll learn more about data collection methods and when to use them later in this module.)<\/p>\n<p>Your data collection plan goes hand in hand with your analysis plan. Different types of analysis yield different types of results. The analysis plan should match the type of data you are collecting, as well as the outcomes your project is seeking and the resources at your disposal. Simpler research designs tend to require simpler analysis techniques. More complex research designs can yield powerful results, such as understanding causality and trade-offs in customer perceptions. However, these more sophisticated designs can require more time and money to execute effectively, both in terms of data collection and analytical\u00a0expertise.<\/p>\n<p>The research plan also specifies who will conduct the research activities, including data collection, analysis, interpretation, and reporting on results. At times a singlehanded marketing manager or research specialist runs the entire research project.\u00a0At other times, a company may contract with a marketing research analyst or consulting firm to conduct the research. In this situation, the marketing manager provides supervisory oversight to ensure the research delivers on expectations.<\/p>\n<p>Finally, the research plan indicates\u00a0who will interpret the research findings and how the findings\u00a0will be reported. This part of the research plan should consider the internal audience(s) for the research and what reporting format will be most helpful. Often,\u00a0senior executives are primary stakeholders, and they&#8217;re anxious for marketing research to inform and validate their choices. When this is the case, getting their buy-in on\u00a0the research plan is\u00a0recommended to make sure\u00a0that they are comfortable with the approach and receptive to the potential findings.<\/p>\n<div class=\"textbox examples\">\n<h3>A Bookends Research Plan<\/h3>\n<p>You talk over the results of your problem identification work with Dan. He thinks you&#8217;re on the right track and wants to know what&#8217;s next. You explain that the next step is to put together a detailed plan for getting\u00a0answers to the research questions.<\/p>\n<p>Dan is enthusiastic, but he&#8217;s also short on money. You realize that such a financial constraint\u00a0will limit what&#8217;s possible, but\u00a0with Dan&#8217;s help you can do something worthwhile. Below is the research plan you sketch out:<\/p>\n<div class=\"aligncenter\">\n<table>\n<caption>Identifying Data Types, Timing and Budget, Data Collection Methods, Analysis, and Interpretation<\/caption>\n<tbody>\n<tr>\n<th scope=\"row\">Types of data needed<\/th>\n<td style=\"width: 75%;\">1) Demographics and attitudes of current Bookends customers; 2) current customers&#8217; spending patterns; 3) metro area demographics (to determine types of people who aren&#8217;t coming to the store)<\/td>\n<\/tr>\n<tr>\n<th scope=\"row\">Timing &amp; budget<\/th>\n<td>Complete project within 1 month; no out-of-pocket spending<\/td>\n<\/tr>\n<tr>\n<th scope=\"row\">Data collection methods<\/th>\n<td>1) Current customer survey using free online survey tool, 2) store sales data mapped to customer survey results, 3) free U.S. census data on metro-area demographics, 4) 8\u201310 intercept (&#8220;man on the street&#8221;) interviews with non-customers<\/td>\n<\/tr>\n<tr>\n<th scope=\"row\">Analysis plan<\/th>\n<td>Use Excel or Google Sheets to tabulate data; Marina (statistician cousin) to assist in\u00a0identifying data patterns that could become market segments<\/td>\n<\/tr>\n<tr>\n<th scope=\"row\">Interpretation and reporting<\/th>\n<td>You and Dan will work together to comb through the data and see what insights it produces. You&#8217;ll use PowerPoint to create a report that lays out significant results, key findings, and recommendations.<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n<\/div>\n<h2>Step 3:\u00a0Conduct the Research<\/h2>\n<p>Conducting research can be a fun and\u00a0exciting part of the marketing research process. After struggling with the gaps in your knowledge\u00a0of market dynamics\u2014which led you to embark on a marketing research project in the first place\u2014now things are about to change. Conducting research begins\u00a0to generate information that helps answer your urgent marketing questions.<\/p>\n<p>Typically data collection begins by reviewing any existing research and data that provide some information or insight about the problem. As a rule, this is secondary research. Prior research projects, internal data analyses, industry reports, customer-satisfaction survey results, and other information sources may be worthwhile to review. Even though these resources may not answer your research questions fully, they may further illuminate the problem you are trying to solve. Secondary research and data sources are\u00a0nearly always cheaper than capturing new information on your own. Your marketing research project should benefit from prior work wherever possible.<\/p>\n<p>After getting everything you can from secondary research, it&#8217;s time to shift attention to primary research, if this is part of your research plan. Primary research involves asking questions and then listening to and\/or observing\u00a0the behavior of the target audience you are studying. In order to generate reliable, accurate results, it is important to use proper scientific methods for primary research data collection and analysis. This includes identifying the right individuals and number of people to talk to, using carefully worded surveys or interview scripts, and capturing data accurately.<\/p>\n<p>Without proper techniques, you may inadvertently get\u00a0bad data or discover bias in the responses that distorts the results and points you in the wrong direction. The module on Marketing Research Techniques\u00a0discusses these issues in further detail, since the procedures for getting reliable data vary by research method.<\/p>\n<div class=\"textbox examples\">\n<h3>Getting the Data on Bookends<\/h3>\n<p>Dan is on board with the research plan, and he&#8217;s excited to dig into the project. You start with secondary data, getting a dump of Dan&#8217;s sales data from the past two years, along with related information: customer name, zip code, frequency of purchase, gender, date of purchase, and discounts\/promotions (if any).<\/p>\n<p>You visit the U.S. Census Bureau Web site to download demographic data about your metro area. The data show\u00a0all zip codes in the area, along with population size, gender breakdown, age ranges, income, and education levels.<\/p>\n<p>The next part\u00a0of the project is customer-survey data. You work with Dan to put together a short survey about customer attitudes toward Bookends, how often and why they come, where else they spend money on books and entertainment, and why they go other places besides Bookends. Dan comes up with the great idea of offering a 5 percent discount coupon to anyone who completes the survey. Although it eats into his profits, this scheme gets more people to complete the survey and buy books, so it&#8217;s worth it.<\/p>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"alignright wp-image-3823\" src=\"https:\/\/s3-us-west-2.amazonaws.com\/courses-images\/wp-content\/uploads\/sites\/143\/2016\/09\/21232425\/19313315520_2e9781f93a_k-1024x576.jpg\" alt=\"decorative image\" width=\"299\" height=\"168\" \/>For a couple of days, you and Dan take turns doing &#8220;man on the street&#8221; interviews (you interview the guy in the red hat, for instance). You find people who say they&#8217;ve never been to Bookends and ask them a few questions about why they haven&#8217;t visited the store, where else they buy books and other entertainment, and what might get them interested in visiting Bookends sometime. This is all a lot of work, but for a zero-budget project, it&#8217;s coming together pretty well.<\/p>\n<\/div>\n<h2>Step 4:\u00a0Analyze and Report Findings<\/h2>\n<p>Analyzing\u00a0the data obtained in a market survey involves transforming the primary and\/or secondary data into useful information and insights that answer the research questions. This information is condensed into a format to be used by managers\u2014usually\u00a0a presentation or detailed report.<\/p>\n<p>Analysis starts with formatting, cleaning, and editing the data to make sure that it&#8217;s\u00a0suitable for whatever analytical techniques are being used. Next, data are tabulated to show what&#8217;s happening: What do customers actually think? What&#8217;s happening with purchasing or other behaviors? How do revenue figures actually add up? Whatever the research questions, the analysis takes source data and applies analytical techniques\u00a0to provide a clearer picture of what&#8217;s going on. This process may involve simple or sophisticated techniques, depending on the research outcomes required. Common analytical techniques include\u00a0regression analysis to determine correlations between factors; conjoint analysis to determine trade-offs and priorities; predictive modeling to anticipate patterns and causality; and analysis of unstructured data such as Internet search terms or\u00a0social media posts to provide context and meaning around what people say and do.<\/p>\n<p>Good analysis is important because the interpretation of research data\u2014the &#8220;so what?&#8221; factor\u2014depends on it. The analysis combs through data to paint a picture of what&#8217;s going on. The interpretation goes further to explain what the research data mean and make recommendations about what managers need to know and do based on the research results. For example, what is the short list of\u00a0key findings and takeaways that managers should remember from the research? What are the market\u00a0segments you&#8217;ve identified, and which ones should you target?\u00a0\u00a0What are the primary reasons your customers choose your competitor&#8217;s product over yours, and what does this mean for future\u00a0improvements to your product?<\/p>\n<p>Individuals with a good working knowledge of the business should be involved in interpreting the data because they are in the best position to identify significant insights and make\u00a0recommendations from\u00a0the research findings.\u00a0Marketing research reports incorporate both analysis and interpretation of data to address the project objectives.<\/p>\n<p>The final report for a marketing research project may be in written form or slide-presentation format, depending on organizational culture and management preferences. Often a\u00a0slide presentation is\u00a0the preferred format for initially sharing research results with internal stakeholders. Particularly for large, complex projects, a written report may be\u00a0a better format for discussing detailed findings and nuances in the data, which managers can study and reference in the future.<\/p>\n<div class=\"textbox examples\">\n<h3>Analysis and\u00a0Insights for Bookends: Target market validation<\/h3>\n<p>Getting the data was a bit of a hassle, but now you&#8217;ve got it, and you&#8217;re excited to see what it reveals. Your statistician cousin, Marina, turns out to be a whiz with both the sales data and the census data. She identified\u00a0several\u00a0demographic profiles in the metro area that looked a lot like lifestyle segments. Then she mapped Bookends&#8217; sales data into those segments to show who is and isn&#8217;t visiting Bookends. After matching customer-survey data to the sales data, she broke down the segments further based on their spending levels and reasons they visit\u00a0Bookends.<\/p>\n<p>Gradually\u00a0a clearer picture of Bookends&#8217; customers is beginning to emerge: who they are, why they come, why they don&#8217;t come, and what role Bookends plays in their lives. Right away,\u00a0a couple of higher-priority segments\u2014based on their spending levels, proximity, and loyalty to Bookends\u2014stand out. The research has succeeded in segmenting the market into manageable targets. You and your uncle\u00a0are definitely seeing some possibilities for making the bookstore a more prominent part of their lives. You capture these insights as &#8220;recommendations to be considered&#8221; while you evaluate the right marketing mix for each of the\u00a0new segments you have now validated.<\/p>\n<\/div>\n<h2>Step 5:\u00a0Take Action<\/h2>\n<p>Once\u00a0the report is complete, the presentation is delivered, and the recommendations are made, the marketing research project is over, right? Wrong.<\/p>\n<p>What comes next is arguably the most important step of all: taking action based on your research results.<\/p>\n<p>If your project has done a good job interpreting the findings and translating them into recommendations for the marketing team and other areas of the business, this step may seem relatively straightforward. When the research results validate a path the organization is already on, the &#8220;take action&#8221; step can galvanize the team to move further and faster in that same direction.<\/p>\n<p>Things are not so simple when the research results indicate\u00a0a new direction or a significant shift is advisable. In these cases, it&#8217;s worthwhile to spend time helping managers understand the research, explain why it is wise to shift course, and explain how the business will benefit from the new path. As with any important business decision, managers must\u00a0think deeply about the new approach and carefully map strategies, tactics, and available resources to plan\u00a0effectively. By making the results available and accessible to managers and their execution teams, the marketing research project can serve as an ongoing guide and touchstone to help the organization plan, execute, and adjust course as it works toward desired goals and outcomes.<\/p>\n<p>It is worth mentioning\u00a0that many marketing research projects are never translated into management action. Sometimes this is because the\u00a0report is too technical and difficult to understand. In other cases, the research conclusions fail to provide useful insights or solutions to the problem, or the report writer fails to offer\u00a0specific suggestions for\u00a0translating the research findings into management strategy. These pitfalls can be avoided by paying due attention to the research objectives throughout the project and allocating sufficient time and resources to do a good job interpreting research results for those who will need to act on\u00a0them.<\/p>\n<div class=\"textbox examples\">\n<h3>Bookends&#8217; New Customer Campaign<\/h3>\n<p>Your research findings and recommendations identified three segments for\u00a0Bookends to focus on. Based on the\u00a0demographics, lifestyle, and spending patterns found during your\u00a0marketing research, you&#8217;re able to name them: 1) Bored Empty-Nesters, 2) Busy Families, and 3) Hipster Wannabes. Dan has a decent-sized clientele across all three groups, and they are pretty good spenders when they come in. But until now he hasn&#8217;t done much to purposely attract any of them.<\/p>\n<p>With newly identified segments in focus, you and Dan begin brainstorming about a marketing mix to target each group. What types of books and other products would appeal to each one? What activities or events would bring them into the store? Are there promotions or particular messages that would induce them to buy at Bookends instead of Amazon or another bookseller? How will Dan reach and communicate with each group? And what can you do to bring more new customers into the store within these target groups?<\/p>\n<p>Even though Bookends is a real-life project with\u00a0serious consequences for your uncle Dan, it&#8217;s also a fun laboratory where you can\u00a0test\u00a0out some of the principles you&#8217;re learning in your marketing class. You&#8217;re figuring out quickly what it&#8217;s like to be a marketer.<\/p>\n<p>Well done, rookie!<\/p>\n<\/div>\n<div class=\"textbox tryit\">\n<h3>Practice Questions<\/h3>\n<p>\t<iframe id=\"assessment_practice_45c4d1be-17df-4976-b470-4ab9445b7620\" class=\"resizable\" src=\"https:\/\/assess.lumenlearning.com\/practice\/45c4d1be-17df-4976-b470-4ab9445b7620?iframe_resize_id=assessment_practice_id_45c4d1be-17df-4976-b470-4ab9445b7620\" frameborder=\"0\" style=\"border:none;width:100%;height:100%;min-height:300px;\"><br \/>\n\t<\/iframe><\/p>\n<p>\t<iframe id=\"assessment_practice_ccfac18f-dd0c-4350-93d8-b744bc8301e1\" class=\"resizable\" src=\"https:\/\/assess.lumenlearning.com\/practice\/ccfac18f-dd0c-4350-93d8-b744bc8301e1?iframe_resize_id=assessment_practice_id_ccfac18f-dd0c-4350-93d8-b744bc8301e1\" frameborder=\"0\" style=\"border:none;width:100%;height:100%;min-height:300px;\"><br \/>\n\t<\/iframe>\n<\/div>\n\n\t\t\t <section class=\"citations-section\" role=\"contentinfo\">\n\t\t\t <h3>Candela Citations<\/h3>\n\t\t\t\t\t <div>\n\t\t\t\t\t\t <div id=\"citation-list-7136\">\n\t\t\t\t\t\t\t <div class=\"licensing\"><div class=\"license-attribution-dropdown-subheading\">CC licensed content, Original<\/div><ul class=\"citation-list\"><li>Revision and Adaptation. <strong>Authored by<\/strong>: Lumen Learning. <strong>License<\/strong>: <em><a target=\"_blank\" rel=\"license\" href=\"https:\/\/creativecommons.org\/licenses\/by\/4.0\/\">CC BY: Attribution<\/a><\/em><\/li><li>Practice Questions. <strong>Authored by<\/strong>: Robert Danielson. <strong>Provided by<\/strong>: Lumen Learning. <strong>License<\/strong>: <em><a target=\"_blank\" rel=\"license\" href=\"https:\/\/creativecommons.org\/licenses\/by\/4.0\/\">CC BY: Attribution<\/a><\/em><\/li><\/ul><div class=\"license-attribution-dropdown-subheading\">CC licensed content, Shared previously<\/div><ul class=\"citation-list\"><li>Chapter 3: Marketing Research: An Aid to Decision Making, from Introducing Marketing. <strong>Authored by<\/strong>: John Burnett. <strong>Provided by<\/strong>: Global Text. <strong>Located at<\/strong>: <a target=\"_blank\" href=\"http:\/\/solr.bccampus.ca:8001\/bcc\/file\/ddbe3343-9796-4801-a0cb-7af7b02e3191\/1\/Core%20Concepts%20of%20Marketing.pdf\">http:\/\/solr.bccampus.ca:8001\/bcc\/file\/ddbe3343-9796-4801-a0cb-7af7b02e3191\/1\/Core%20Concepts%20of%20Marketing.pdf<\/a>. <strong>License<\/strong>: <em><a target=\"_blank\" rel=\"license\" href=\"https:\/\/creativecommons.org\/licenses\/by\/4.0\/\">CC BY: Attribution<\/a><\/em><\/li><li>Urban life (Version 2.0). <strong>Authored by<\/strong>: Ian D. Keating. <strong>Located at<\/strong>: <a target=\"_blank\" href=\"https:\/\/www.flickr.com\/photos\/ian-arlett\/19313315520\/\">https:\/\/www.flickr.com\/photos\/ian-arlett\/19313315520\/<\/a>. <strong>License<\/strong>: <em><a target=\"_blank\" rel=\"license\" href=\"https:\/\/creativecommons.org\/licenses\/by\/4.0\/\">CC BY: Attribution<\/a><\/em><\/li><\/ul><\/div>\n\t\t\t\t\t\t <\/div>\n\t\t\t\t\t <\/div>\n\t\t\t <\/section>","protected":false},"author":26,"menu_order":12,"template":"","meta":{"_candela_citation":"[{\"type\":\"cc\",\"description\":\"Chapter 3: Marketing Research: An Aid to Decision Making, from Introducing Marketing\",\"author\":\"John Burnett\",\"organization\":\"Global Text\",\"url\":\"http:\/\/solr.bccampus.ca:8001\/bcc\/file\/ddbe3343-9796-4801-a0cb-7af7b02e3191\/1\/Core%20Concepts%20of%20Marketing.pdf\",\"project\":\"\",\"license\":\"cc-by\",\"license_terms\":\"\"},{\"type\":\"original\",\"description\":\"Revision and Adaptation\",\"author\":\"Lumen Learning\",\"organization\":\"\",\"url\":\"\",\"project\":\"\",\"license\":\"cc-by\",\"license_terms\":\"\"},{\"type\":\"cc\",\"description\":\"Urban life (Version 2.0)\",\"author\":\"Ian D. 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