What is Marketing Research?

The definition of marketing research recognizes the complexity of the process and the different activities that may be performed.

Marketing research links the consumer, the customer, and the public through information used to:

• Identify and define marketing opportunities.

• Generate, refine, and evaluate marketing actions.

• Monitor marketing performance.

• Improve understanding of marketing as a process.

Marketing research:

• Specifies the information required to address these issues.

• Designs the methods for collecting information.

• Manages and implements the data collection process.

• Analyzes the results.

• Communicates the findings and implications.

This definition emphasizes the generation of information that assists in managerial decision making. Marketing research is useful in planning, problem solving, and control. Marketers use marketing research to provide guidance in decision making. This enables them to spend their resources more effectively. Researchers must understand the research process, the marketing process, and the industries in which the firm operates. Take the research team for Stouffers, a national organization that manages private restaurants and clubs, for examples. Stouffers researchers must understand the growth and image objectives of the organization, besides identifying new market opportunities and conducting customer satisfaction surveys. Only by knowing the club business a meaningful research can be conducted to support the Stouffers organization. Pizza Hut now links its unit managers’ bonuses to the results of customer satisfaction surveys. Questions address satisfaction with service, food quality, and other issues.

Marketing research is often used to evaluate the characteristics and potential of markets prior to making decisions about product introductions and new-market entry. Research is helpful in evaluating new-product concepts and advertising campaigns under consideration. It is also used to monitor market performance and competitive reaction. Nielsen Inc., one of the oldest and largest marketing research firms, provides data to packaged-goods manufacturers like Coca-Cola and Nabisco about their product sales. Research is also used to identify and solve problems. Municipalities, for example, frequently conduct marketing research to identify citizens’ needs and methods for attracting shoppers to the area.

Most important, marketing research should support the firm’s overall market orientation. Research links marketers to markets through information and scientific study. It is used to explore opportunities and problems, monitor performance, refine marketing strategy, and improve understanding of marketing efforts and markets themselves. As such, research enhances a firm’s closeness with its customers and enables the marketer to anticipate latent unfulfilled needs and wants.

Kinds of questions marketing research can help answer:

1. Planning

1. What kinds of people buy our products? Where do they live? How much do they earn? How many of them are there?

2. Are the markets for our products increasing or decreasing? Are there promising markets that we have not yet reached?

3. Are the channels of distribution for our products changing? Are new types of marketing institutions likely to involve?

2. Problem solving

1. Product

1. Which of various product designs is likely to be the most successful?

2. What kind of packaging should we use?

2. Price

1. What price should we charge for our products?

2. As production costs decline, should we lower our prices or try to develop higher quality products?

3. Place

1. Where and by whom should our products be sold?

2. What kinds of incentives should we offer the trade to push our products?

4. Promotion

1. How much should we spend on promotion? How should it be allocated to products and to geographic areas?

2. What combination of media – newspapers, radio, television, magazines – should we use?

3. Control

1. What is our market share overall? In each geographic area? By each customer type?

2. Are customers satisfied with our products? How is our record for service? Are there many returns?

3. How does the public perceive our company? What is our reputation with the trade?

Comprehension questions:

1. What does marketing research recognize?

2. What information links the customer, the consumer and the public?

3. Where and why is marketing research useful?

4. What is research? What is research used to?

5. Can you name the questions marketing research help to answer?