Marketers use market research to help them better understand customers and markets. These insights are the “how” and “why” certain things happen in the market. Market research is the systematic design, collection, analysis, and reporting of data and findings relevant to a specific marketing situation facing a company. For reference, over $31.2 billion was spent on marketing research globally in 2010.
Market Research Process
The market research process starts with defining the problem. It’s important to answer basic questions: Who, What, When, Why and Where. Then it’s crucial to develop a research plan. Research approaches can consist of observation, focus groups, surveys, behavioral data and/or experiments. Data sources can develop from secondary or primary sources. Researchers can also choose several research instruments such as questionnaires, qualitative interviews, or quantitative technology devices to get insights from consumers.
A marketer should develop a research plan and collect the proper information. While analyzing the information, a measuring system should be developed to compute averages and statistical data so decisions can be made. When conducting qualitative research, the question “why” should capture motivation. This can be done by using word associations, and by using projective techniques. For example, “what would John do?” Another technique is laddery. This method consists of ending every question with “why.”
Next a decision should be made about the defined problem. The data should transform raw data into insight and present the information to the team and client in a clear and compelling fashion. The insights research brings to a team has the power to help all members on a team think creatively to solve problems. In the final step, a decision should be made about the defined problem.
Characteristics of Good Marketing Research
1. Scientific method
2. Research creativity
3. Multiple methods
4. Interdependence of models and data
5. Value and cost of information
6. Healthy skepticism
7. Ethical marketing
Market research must be used properly by being designed for specific questions, specific audiences, and using specific tools. Many companies have taken advantage of the benefits market research provides. For example, Domino’s Pizza surveyed their customers to determine how their pizza was being consumed. They in turn used the results found through qualitative research to re-invent their crust and sauce. This increased their bottom line.
Procter & Gamble has also used research to better understand Generation Z. They found that more than 75% of teens own cellphones, according to Pew Internet & American Life Project research. iGeneration also own iPods (76%); hand-held gaming devices (66%); and laptop computers (29%), according to the Kaiser Family Foundation’s media study of 8-to-18-year-olds. This led marketers to find new ways to reach consumers. Procter & Gamble now focuses on entertaining their market through games and interactive media on iPads and mobile devices (Bulk, 2012).
Research should guide decisions, not be used to support decisions already made. Marketers face pressure to provide clear, quantifiable evidence as to how marketing expenditures (ads, promo, etc) are helping their firms be more profitable. Utilizing marketing metrics and techniques that help marketers quantify, compare, and interpret marketing performance result in rewarding work for both a client and a agency.
Bulk, B. (2011). The igeneration: There’s a market for that — and it’s a big, influential one, too. Ad Age, Retrieved from http://adage.com/article/news/igen-influential-peers-household-buying-decisions/230427/
Jugenheimer, D. W., Bradley, S. D., Kelley, L. D., & Hudson, J. C. (2010). Advertising and public relations
research. Armonk, New York: M.E. Sharpe, Inc.
Kotler, P., & Keller, K. (2011). Marketing management. (14 ed., pp. 1-657). Pearson College Div.Marketing