MNM3702 Marketing Research
Study Notes.
STUDY UNIT 1: THE ROLE OF MARKETING RESEARCH IN THE DECISION-MAKING
PROCESS
The Need for Marketing Information
Knowledge comes from information, which comes from data, which comes from marketing research. Marketing
information is therefore crucial for o...
,STUDY UNIT 1: THE ROLE OF MARKETING RESEARCH IN THE DECISION-MAKING
PROCESS
The Need for Marketing Information
Knowledge comes from information, which comes from data, which comes from marketing research. Marketing
information is therefore crucial for organisations. Marketing research serves two important purposes, namely:
• It provides the organisation with information about customer demand for products and services.
• It gives customers the opportunity to express their views and needs, and thus influence decision-making to
ensure they get the products and service they want.
Marketing management should be directed at the future and it must:
• Anticipate environmental changes.
• Predict the direction and impact of these changes.
• Plan accordingly.
Management needs information about all internal and external environmental factors that can influence marketing
efforts and results. The nature of these ever-changing conditions means that the organisation has to manage its
marketing information as effectively as possible. Marketing information is a prerequisite for effective information.
Changes in the internal and external environments that are putting pressure on the need for marketing information
are:
• Descriptive Research- this depicts a current situation. The focus is on providing the company with historical and
current data about the consumer, industry and environment, and the impact or relevance of this data to the
company in question.
• Diagnostic research- this diagnoses the cause and effects of a certain event in a given situation.
• Predictive research- this is used to predict or forecast the outcomes of new strategies being developed. The
focus is looking towards the future and identifying new opportunities to be taken advantage of.
Management has had to find ways to manage data due to the internet explosion. Thus, data management is
essential. It is important that managers can differentiate between relevant and irrelevant data. Data needs to be
available to the right decision makers, at the right place, at the right time and in the right form. The massive flow of
data must be filtered, analysed and stored- this is done by the marketing information system.
IMPORTANT TERMINOLOGY:
• DATA- this refers to all available statistics, opinions, facts and predictions.
• INFORMATION- anybody of facts in a format suitable for decision making or in a context that defines the
relationship between two or more pieces of data.
• CONCLUSION- a proposition that is arrived at after considering evidence, arguments or premises; the end of a
reasoning process involving data, evidence, or observations from an investigation.
• DEDUCTION- a form of logical reasoning that begins with a general assertion and then presents specific details
and examples in support of that generalisation. Deductive reasoning is a process that proceeds from the general
to the specific, from theory to empirical data.
• INDUCTION- the explanation of particular facts or instances to form a general principle. Induction argues from
specific cases or data to a general conclusion. It works in reverse to deduction by offering a number of examples
and then concluding with a general truth or principle.
,• HYPOTHESIS- an unproven statement or proposition about a factor or phenomenon that is of interest to the
researcher.
• THEORY- a set of systematically interrelated concepts, definitions, and propositions that are advanced to explain
and predict phenomena.
• KNOWLEDGE- a blend of information, experience, and insights providing a framework that can be thoughtfully
applied when assessing new information or evaluating relevant situations.
Definition and Scope of Marketing Research
Marketing Research Definition:
• Marketing research is defined as the systematic collection, analysis and interpretation of information about all
marketing problems by means of recognised scientific methods to provide information that marketing
management can use in the decision-making process.
Basic Research Versus Applied Research
• Basic marketing research is more general and simply aims to obtain and generate information about aspects of
the marketing system. Little emphasis is placed on how to use or apply this information is the marketing
management process. This type of research is based on a hypothesis and a theory and is carried out thoroughly
and fully.
• Applied research is aimed at helping management make better decisions about a specific aspect. This research is
conducted to solve a particular problem. And is more specific to the organisation. The information needs of the
decision maker largely determine the thoroughness with which applied research is carried out.
Scientific Method of Marketing Research
The basic steps of the scientific method are:
1. Identify a problem and formulate a hypothesis.
2. Design a study.
3. Conduct the research.
4. Test the hypothesis.
5. Report the results.
The scientific method is distinguished by two general characteristics:
• Validity
• Reliability
There are three elements that influence the validity and reliability of research, namely:
• Objectivity of the researcher.
• Accuracy of the measurement.
• Continuous and comprehensive research.
Factors contributing to the development of marketing research
• The shift from production- to marketing orientated economy and management philosophy.
• Changes in the cost structure of organisations.
• A shift in emphasis from price to non-price competition.
• Expansion of the production process.
• Increase in discretionary buying power.
• Increasing differentiation in supply.
• High cost of marketing.
• Emergence of the professional manager.
, Characteristics of Good Research
• A clearly defined research problem.
• A detailed description of the research methodology.
• A properly planned procedural design of the research.
• Honest researchers.
• Data analysis methods that reveal the significance of the collected data and that are appropriate for the type of
study undertaken.
• Research conclusions that are limited to the findings identified in the data analysis and that identify any
shortcomings in the research design.
Good researchers have to have the following qualities:
• A willingness to learn. • Curiosity.
• Technical Competence. • The ability to identify and ask important questions.
• Honesty. • Be able to see the bigger picture.
• Flexibility. • The ability to distinguish between relevant and
irrelevant information.
The Value and Limitation of Marketing Research
Research on its own cannot solve problems on its own, it only provides the information. The results from marketing
information must be interpreted and then managers will make decisions.
When is Marketing Research Necessary?
There are five key factors used to determine whether or not marketing research is required, namely:
• Time Limits – the amount of time that there is before the information is needed.
• Availability of Data- what data is available is determined and if this data is not sufficient, market research needs
to be conducted.
• Nature of Decision- decisions that are complex, and not routine may need more research.
• Advantages versus Cost- research should only be conducted if the return on investment justifies the expenditure,
the increased quality of the marketing decision justifies the expenditure and if the cost of the research
represents the best use of funds.
• Resources- the resources available need to be considered when conducting the research as well as implementing
the findings.
Marketing Research in Perspective
The task of marketing research is to provide information for decision-making purposes; thus, marketing research and
decision making are interdependent. The quality of decisions is heavily influenced by the quality of research which is
reliant on an accurate description of the problem that needs to be solved. It is up to the decision maker to
incorporate all sources of information and influences to make the most appropriate decision.
Contributions of marketing research to the decision-making process include:
• Identifying and defining a problem.
• Identifying possible explanations.
• Investigating various alternatives and eliminating improbable explanations.
• Predicting possible alternative directions.
• Final decision about the policy to be adopted.
• Implementing the decision.
Ethics and Marketing Research
Conducting research in an ethical manner is essential as a lack of ethical behaviour can harm people in the research
process. Other reasons why ethical research is important include:
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller LOVELY01. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $3.00. You're not tied to anything after your purchase.
