Marketing research (also called consumer research) is a form of business research. The field of marketing research as a statistical science was pioneered by Arthur Nielsen with the founding of the ACNielsen Company in 1923.
Marketing research is a systematic and objective study of problems pertaining to the marketing of goods and services. It is applicable to any area of marketing. Research is the only tool an organization has to keep in contact with its external operating environment. In order to be proactive and change with the environment simple questions need to be asked:
- What are the customer needs and how are they changing? How to meet these changing needs? What do the customers think about existing products or services? What more are they looking at?
- What are the competitors doing to retain customers in this environment? Are their strategies exceeding or influencing yours? What should you do to be more competitive?
- How are macro and micro environmental factors influencing your organization? How will you react to this environment?
Authors have defined Marketing Research in many ways:
- Kotler (1999) defines marketing research as ‘systematic problem analysis, model-building and fact-finding for the purpose of improved decision-making and control in the marketing of goods and services’.
- The American Marketing Association (AMA, 1961) defines it as ‘the systematic gathering, recording and analyzing of data relating to the marketing of goods and services’.
- Green and Tull have defined marketing research as the systematic and objective search for and analysis of information relevant to the identification and solution of any problem in the field of marketing.
The aim of marketing management is to satisfy the needs of the consumer. Marketing research helps in achieving this. Marketing research is a systematic and logical way of assessing ways of satisfying customer needs.
According to all the above definitions, Marketing Research starts by stating the problem or the issue to be investigated; indicate what kind of information is required to resolve the problem; identify where and how to get it; specify the methodology for analyzing the research findings; sum up the research findings and then suggest the best solution for marketing decision making.
Scope of marketing research:
Marketing research can be used in:
· Product Management: One of the major scope of marketing research is to manage the current products and new products. In product management Marketing Research is helpful in
- Competitive Intelligence – To understand the competitive product strategy.
- Prelaunch strategy for new products
- Test Marketing – To monitor the performance of the brand by launching in a select area and then taking it across the country. In other words it is a small-scale product launch used to determine the likely acceptance of the product when it is introduced into a wider market.
- Concept testing - to test the acceptance of a concept by target consumers.
· Sales analysis: Marketing research is used to study the sales trend and make suitable strategies when required. It is used to
- Assess market potential
- Estimation of demand for a product
- Market share estimation
- Study seasonal variation for a product
- Market segmentation studies
- Estimate size of the market
- Need analysis to find out where the product fits in
· Corporate Research: Marketing Research is used to analyze the corporate effectiveness. Some examples are:
- Assessing the image of the company
- Knowledge of the company activities
· Advertising Research: Advertising is an arena in which Marketing Research is extensively used. Some scope are:
- Readership feedbacks – Mainly carried out for newspapers and magazines
- Advertising Recall – To assess the recall of television or other advertising and thereby assess its effectiveness.
· Syndicated Research: This is compiled by agencies on a regular basis and sold to organizations on subscription basis.
All of these forms of marketing research can be classified as either problemidentification
research or as problem-solving research.
A similar distinction exists between exploratory research and conclusive research.
- Exploratory research provides insights into and comprehension of an issue or situation. It should draw definitive conclusions only with extreme caution.
- Conclusive research draws conclusions: the results of the study can be generalized to the whole population.
Research can also be:
- Primary Marketing Research: It is research conducted by an organization for its own purpose which addresses its requirements. It is generally expensive but is specific and objective to the organization’s requirement.
- Secondary Marketing Research: This is used if the organization is considering extending its business into new markets or adding new services or product lines. This type of research is based on informationobtained from studies previously performed by government agencies, chambers of commerce, trade associations and other organizations. This also includes Census Bureau information.
In other terms this is research published previously and usually by someone else. Secondary research costs less than primary research, but seldom comes in a form that exactly meets the needs of the researcher. It can cater to anyone who wishes to use the data.
This data can be found in local libraries or on the Web, but books and business publications, as well as magazines and newspapers, are also great sources.
Hence, Primary research delivers more specific results than secondary research, which is an especially important while launching a new product or service. In addition, primary research is usually based on statistical methodologies that involve sampling as small as 1 percent of a target market. This tiny representative sample can give an accurate representation of a particular market.
With the advance in technology a lot of software have been developed which help in primary market research online and offline thereby making analysis and interpretation easier.
The ideal way to conduct Marketing Research is to do secondary research first and then do the primary research for the data not available form secondary sources.
Hence, secondary research lays the groundwork and primary research helps fill in the gaps. By using both types of market research, organizations get a better picture of their market and have the information they need to make important business decisions.
