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Marketing research: Definition, steps, uses & advantages

What is marketing research?

Marketing research is defined as any technique or a set of practices that companies use to collect information to understand their target market better. Organizations use this data to improve their products, enhance their UX, and offer a better product to their customers. Marketing research is used to determine what the customers want, and how they react to products or features of a product.

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Four standard marketing research methods

The four most common marketing research methods are surveys, interviews, customer observations, and focus groups. You can research various ways without limiting yourself to just one way. Let’s dive deeper into each of these marketing research techniques.

Researchers collect responses by deploying surveys and managing data via online questionnaires or on-screen surveys at the POS. These surveys contain closed-ended and open-ended questions. They are popular and are the most widely used research techniques.

Why are online surveys popular?

Surveys are inexpensive, simple to set-up, deploy, and gather responses. It gets easy to collect multiple answers from a tailored audience group using surveys. Researchers rely on quantitative data, and online surveys provide quick responses compared to the more traditional offline methods. You can collect large amounts of data within minutes from anywhere in the world.

2. Interviews

Face-to-face or personal interviews are a more traditional way of doing marketing research. It is a slow and more expensive way of collecting responses. Researchers doing large scale marketing research do not prefer this method to collect a large number of responses. Interviews are conducted both in-person and on the telephone (CATI). 

Why are interviews important?

Personal interviews may not be widely used but play a significant role in understanding precisely what the respondent feels. You can record more than just verbal responses and understand the customer better. Often, when two humans interact with each other, more information is shared because of the dialogue. Personal interviews are useful in small-scale studies, where the researcher wants to interview a specific group of local respondents. CATI’s are helpful when the respondent base is more expansive.

3. Focus groups

Focus groups or online focus groups involve several respondents who participate in discussions about a particular topic. A researcher conducts focus groups to obtain richer information. The main reason for a focus group is to hold a dialogue between various people on a particular topic of interest. Unlike interviews, focus group members are allowed to interact with each other and influence one another.

Why are focus groups impactful?

It is no secret that focus groups are hugely impactful in decision making. Researchers gain a lot of information by organizing focus groups. Often, focus groups bring up issues not foreseen by researchers. Online or video focus groups have a broad reach, and many organizations have now started creating and nurturing research communities for better respondent handling and data gathering. Direct interaction of business groups and customers positively impacts users because they feel that their voices are heard.

4. Observation

Observation, though not popular and widely used, gives intuitive feedback. Research companies organize customer observation sessions to gather information on how they engage with the product or service (or a similar competitor product or service). Feedback from people’s behavioral attitudes is a powerful tool for researchers looking to improve their products and services.

What makes observation so powerful?

Observational market research is an excellent alternative to focus groups. It’s not only an inexpensive research tool, but you will also witness people interacting with and using your product in a natural environment. The downside is that you will have to make inferences about their feelings and reactions.

LEARN ABOUT: market research trends

How to conduct marketing research

Follow these four marketing research steps to help you understand what your users think and feel about your product, service, or business.

LEARN ABOUT: Behavioral Research

1. Create simple user personas

A user persona is nothing more than a fictional character that represents a user or a customer. Understanding user personas will help you gauge how different persons react to other products and services to understand their needs. To create a persona, your questions must answer these types questions about the user or customer:

• Who are they?
• What’s their primary goal?
• What stops them from achieving that goal?

2. Conduct observational research

Use both overt and covert observation methods to observe and take notes while users use your products or a similar one.

Overt vs. covert observation

• Overt observation asks users if they will allow you to watch them use your product. 
• Covert observation studies users in a natural environment without them knowing. This type of observation generally works only if you sell a product that consumers buy and use regularly. It brings in the purest observational research data as people act naturally while using the products. 

3. Conduct personal interviews

One-on-one conversations with your target population allow you to explore and dig deep into their concerns, revealing answers to many questions. Here are a few tips for conducting personal interviews.

• Be a journalist and not a salesperson. Ask users about their frustrations, needs, and areas where they think they need an improvement in the product. 
• Pose the ‘why’ question to dig deeper. Dive into the details to know more about their past behavior.
• Recording the conversation helps you focus on it rather than take notes simultaneously.

4. Analyze the data

The idea of conducting lean marketing research is to receive quick, actionable insight data. Analyze the information you have collected using various techniques to draw patterns into what customers like and dislike, what they want, and what they do not need. Create a simple visual representation of how people will interact with each other and the product to assess their needs in a better way.

LEARN ABOUT: Marketing Insight

Why is research so valuable?

Without research, it is impossible to gauge and understand your customers. Of course, you will have an idea of what they need and who they are and, but you must dive deeper to win their loyalty. Here is why marketing research matters:

• Attract potential customers: The primary aim of marketing research is to find ways to attract potential customers. It also helps to keep current happy and coming back for more. Understanding your customers entirely is the only way to progress. You’ll lose potential customers if you stop caring about improving your user experience.
• Answer the why’s: Marketing research gives you the answer to the ‘why.’ Make use of user analytics, big data, and reporting dashboards in marketing research to tell you what your users are thinking and why they think and act that way. For example, only marketing research can explain why customers leave you.
• Data-backed decisions: Research beats trends, assumptions, and so-called best business practices. Bad decisions are often taken due to emotional reasoning and guesswork. Focusing on customer experience by listening to your customers directs you in the right direction.
• Better planning: Research keeps you from making absurd decisions by planning in a vacuum. You might not fully gauge what your customers experience and feel while using your product. Customers may use products in a way that surprises you, and they may get confused by features that seem obvious to you. Conducting too much planning but not testing your assumptions will waste your money, time, efforts, and resources. Research helps you save up on all these factors.

LEARN ABOUT: 12 Best Tools for Researchers

Advantages of MKT research

Marketing research and user experience (UX) design help you continuously improve your product by acting on your feedback. Here are the advantages of conducting marketing research:

• Improved efficiency: Efficiency draws you closer to your users. You can improve the efficiency of delivering the product to the market and also increase its usability.
• Cost-effective: Marketing research helps you make the right decisions based on consumer demand, thus saving you costs in creating something that customers do not like or want.

LEARN ABOUT:  Test Market Demand

• Competitive edge: Quicker, more robust insights can help you place your services and products strategically, gaining a competitive advantage over others.
• Build strategies: You can quickly build, alter, or design new approaches to attract your users and consumers.
• Improved communication: Bridge the communication gap by interacting with consumers and hearing them out. This helps consumers feel wanted and special.
• LEARN ABOUT: Market research vs marketing research

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Marketing Research: Types, Process, Models

Let’s learn about Marketing Research, its types, processes, steps, and models.

Meaning of Marketing Research

Marketing research specifies the information, manages and implements the data collection process, analyzes the results, and communicates the findings and implications. To offset unpredictable consumer behavior, companies invest in marketing research.

Increased customer focus, resource productivity demands, and domestic and international competition have prompted an increased emphasis on marketing research.

Managers cannot always wait for information to arrive in bits and pieces from marketing departments. They often require formal studies of specific situations. This official study is called marketing research, whether performed internally or externally.

As stated earlier, marketing research is generally considered part of an MIS.

Marketing research is the systematic and scientifically unbiased data collection and analysis, preparing information relevant to a particular problem or opportunity.

It may also be defined as the systematic collection of information for decision-making. A firm gets and tests ideas through marketing research.

You should know that marketing research is not a part of the marketing mix but rather an aid to management in making decisions about the company’s marketing mix and the target market.

It is a process, not an institution; as such, it is a part of virtually all aspects of the research process, from data collection to information transmission .

Marketing research processes are almost always used to collect data for recurring and unique decision-making.

For data evaluation, research methods are commonly used to determine the error factors in collected data when certain sampling techniques ( e.g., purposive samples) are used.

Similarly, data transformation occurs mostly through statistical testing methods normally used in marketing research.

We first define and discuss what marketing research refers to.

Marketing Research Definition

Marketing research is the systematic and objective identification, collection, analysis, and dissemination of information about issues relating to marketing products and services for the sole purpose of assisting management in decision-making related to the identification and solution of problems and opportunities in marketing.

Marketing research aims to identify and assess how changing elements of the marketing mix impact customer behavior.

The term is commonly interchanged with market research; however, expert practitioners sometimes draw a distinction.

Market research is concerned specifically with markets, while marketing research is concerned with marketing processes.

Marketing research is partitioned into two sets of categorical pairs:

• Consumer marketing research
• Business-to-business (B2B) marketing research

Consumer Marketing Research

Consumer marketing research is a form of applied sociology that concentrates on understanding consumers’ preferences, attitudes, and behaviors in a market-based economy. It aims to understand the effects and relative success of marketing campaigns.

Arthur Nielsen pioneered consumer marketing research as a statistical science by founding the AC Nielsen Company in 1923.

Marketing managers make numerous strategic and tactical decisions in identifying and satisfying customer needs.

They make decisions about potential opportunities, target market selection , market segmentation, planning and implementing marketing programs, marketing performance, and control.

Traditionally, marketing researchers provided relevant information, and the managers made marketing decisions.

However, the roles are changing, marketing researchers are becoming more involved in decision-making, and marketing managers are becoming more involved with research.

DECIDE Model in Marketing Research

The role of marketing research in managerial decision-making is explained further using the framework of what is known as the DECIDE model . The structure of the model is as follows:

• D: Define the marketing problem;
• E: Enumerate the decision factors;
• C: Collect relevant information;
• I: Identify the best alternative;
• D: Develop (and implement) a marketing plan;
• E: Evaluate the decision and the decision-making process.

The DECIDE model conceptualizes managerial decision-making as a set of six steps. The decision process begins by defining the problem, opportunity, objectives, and constraints.

Next, the possible decision factors that make up the alternative courses of action (controllable factors) and uncertainties (uncontrollable factors) are enumerated.

Then, relevant information on the alternatives and possible outcomes is collected. The next step is to select the best option based on chosen criteria or measures of success.

Then a detailed plan to implement the alternative selected is developed and put into effect. Lastly, the outcome of the decision and the decision process itself is evaluated.

A specialized form of marketing research is the so-called advertising research. The sole purpose of conducting this research is to improve the efficacy of advertising.

It may focus on a specific ad or campaign or be directed at a more general understanding of how advertising works or how consumers use the information in advertising.

It can entail various research approaches, including psychological, sociological, economic, and other perspectives.

Another component of marketing research is product research

Product research looks at what products can be produced with available technology and what new product innovations near-future technology can develop .

Business-to-business (B2B) Marketing Research

There are several ways in which a company can obtain marketing research. The company may have a marketing research department.

The person in charge of this department plays a multidimensional role, such as a study director, administrator, company consultant, and advocate who usually reports to the company’s marketing head.

If the company cannot afford to maintain a separate marketing research department or the services of marketing research firms, it has other affordable options.

They are as follows:

• It can engage students and professors to design and carry out marketing research projects in their favor. This is the most cost-effective way of marketing research activities, and even small companies may afford it.
• The other option is to use online information services where business information may be collected at a meager cost. There are many online services available nowadays on the internet. Browsing the internet may help a company get much-needed information quickly and economically.
• Checking out competitors is another option that small companies may exploit nicely. A regular visit to competitors’ business premises may help the company get many important tips that may be utilized later.
• Taking help from Syndicated Service Research firms is another good option. This type of firm gathers different information on trade and consumers and offers them for sale to interested companies. Information may be gathered at a relatively low cost from syndicated research firms.
• Custom marketing research firms may be hired for some specific projects. This type of firm, if given responsibility, designs the study, conducts it, and reports to the clients on findings. But, it is interesting to note that the study results become the property of the appointing firm.
• Specialty-line marketing research firms may also be hired to get some specialized research services. One of the example of such firms is a field interviewing service firm. This type of firm only provides field interviewers.

Types of Marketing Research

All marketing research activities are not the same and are different in many respects. They may differ in objectives, research design, covered area, depth, data analysis method , presentation, etc.

Research activities may be classified as exploratory, aimed at a specific problem, or used to provide routine feedback. Now let us look at each of them in the following section.

Exploratory Research

Exploratory research is conducted when the problem is generally known, but its nature and causes are not or partially known.

For example, if a company experiences no change in sales even after aggressive promotion, it may conduct exploratory research in this situation.

Because the problem is known here, but its nature and causes are unidentified. What is the problem here?

The problem is sales have not increased despite aggressive sales promotion activities .

Specific Research

This is another type of research. When a problem has been defined, a different type of information input is needed to enable management to make decisions concerning alternative ways of solving the problem.

Specific questions that might be posed include:

• What changes should be made in the marketing mix ?
• Is the product positioned properly?

Questions such as these lead to specific research. Specific research generally involves larger samples and is more costly than exploratory research.

While exploratory research aims to suggest hypotheses, specific research enables management to accept or reject hypotheses with a predetermined confidence level.

Routine Feedback

It attempts to continuously monitor certain development variables such as sales, market share, or consumer sentiment.

Firms with well-operating marketing information systems would receive such information through the marketing intelligence subsystem . Firms without such sophisticated means of conducting routine feedback research have two options.

The first is to utilize the marketing research department to gather and assess routine feedback. Companies without the necessary internal resources may avail themselves of commercial services offered by the different outside research organizations.

What is the primary purpose of marketing research?

Marketing research is the systematic and objective identification, collection, analysis, and dissemination of information about issues relating to marketing products and services to assist management in decision-making related to problems and opportunities in marketing.

How is marketing research different from market research?

Market research is specifically concerned with markets, while marketing research is concerned with marketing processes.

What are the two main categories of marketing research?

The two main categories of marketing research are Consumer marketing research and Business-to-business (B2B) marketing research.

What is the difference between secondary and primary data in research?

Secondary data are data that have already been collected for some other purpose, while primary data are collected by the researcher from the source specifically for the particular purpose of the study.

7 Steps of Marketing Research Process

Most marketing managers delegate the detailed design and implementation of research projects to specialists either within or outside their organizations.

The principal reason for such delegation is that most marketing managers do not have the time or the expertise to engage in market research activities. They must, to a greater or lesser extent, depend on the efforts of others.

Therefore, it is most important that managers know enough about the research process , design, and methods of implementing research to be effective in commissioning research and appraising the quality and cost-effectiveness of its results.

Because marketing research is an element vital in an MIS , it must be conducted systematically and unbiasedly. The information it generates is too important to be haphazardly collected, analyzed, and disseminated.

The methodology can be elaborate and comprehensive, depending on the significance of the problem or opportunity needing study.

Underlying any research study, then, is the need to obtain the best information possible, given environmental and company limitations (e.g., time and money).

But the more scientifically based, the more expensive and time-consuming the marketing research process will be.

Although there is always a risk of collecting and processing useless data, the seven-step research process described below and in the following exhibit will minimize these risks:

• Determine the needed information.
• Conduct a preliminary investigation.
• Weigh the costs and benefits of formal research.
• The research design-how data will be collected.
• Develop the questionnaire or other data collection forms.
• Conduct a formal study.
• Analyze the data and report the results.

Step-1: Determining the Needed Information/Problem Definition

The best research on the wrong study is as useless as conducting the worst research on the right study. If we fail to do a thorough job at this stage, no sophisticated research will save us.

Often, the rush for answers leads to research based on vaguely defined objectives and unspecified information needs. When this happens, decision-makers typically receive only part of the information they actually must have. The research tends to take longer and costs more to collect than is necessary.

The process begins with clearly defined objectives.

• What is the research supposed to accomplish?
• Why is a study going to be made?

Although research studies are conducted for various reasons, the most common ones determine if a problem or opportunity exists or obtain information pertinent to a problem or opportunity.

Whatever the reason, there must be a purpose involved – research is too costly to conduct for idle curiosity. When objectives are clearly defined, specific informational needs can be determined.

Step-2: Conduct a Preliminary Investigation

A preliminary investigation is necessary before any formal data collection is actually undertaken. This investigation tends to be informal, relatively inexpensive, and beneficial for three reasons.

First, the activities in step two define the objectives of the study and the informational needs.

Second, a preliminary investigation sometimes provides the decision-maker with enough information, making further study necessary.

Third, preliminary investigations help familiarize the researchers with the issues involved.

Researchers often are not experts in the fields they study, and they need to develop a feel for the problems or opportunities if they are to prepare and conduct a useful study.

Whatever the reasons, researchers frequently make preliminary investigations, using various sources to obtain the data they need.

The most likely sources used in this particular collection process are secondary data sources, interviews with people inside the firm, and observations of, or interviews with, people outside the firm.

Sources of data

Public institutions and private agencies collect a tremendous amount of data that can frequently prove useful to a researcher. Data that have already been collected for some other purpose are known as secondary data.

That which is collected by the researcher from the source for the particular purpose of the study is called primary data. Quite obviously, secondary data are usually easier, quicker, and cheaper to obtain than primary data.

Unfortunately, secondary data are not always readily available and desirable. Data may be free or for sale, handily indexed and in a useable form, or buried within volumes of other extraneous data.

The accuracy of secondary data frequently cannot be assessed. Information on how they were collected might not be available, so the researcher will never really know if they were obtained systematically and unbiasedly.

Despite these problems, secondary data are still generally preferred because of time, trouble, and cost savings. Among the more important and useful sources of secondary data are:

Internal Company Records

The company’s own records are one of the best sources. Data on sales volume, market shares, competitive tactics, etc., are nearly always maintained.

Government Documents

Certainly, the largest single source of secondary data is the government.

Marketing Research Firms

Several private businesses collect and analyze market data and sell them to other firms. Also, several firms known for their public opinion surveys can provide specialized types of market data.

Trade and Professional Associations

Local and national associations frequently collect and publish data about their particular trades and professions. Since these associations so closely match their industries, they are usually good sources of information.

Advertising Agencies and Media Firms

Advertising agencies, television stations, and large newspapers and radio stations often collect data on the market areas they serve. Researchers may take help from such data in the course of their research.

University Research Centers

Many of the larger universities have developed research bureaus providing published data useful to marketing researchers.

Published Sources

Various business and trade publications are accessible, inexpensive, and usually very timely.

The primary data can be obtained mainly from two sources. Now we shall mention these two sources/ways of collecting primary data:

Interviews with People Inside the Firm

Marketing researchers frequently turn to knowledgeable people within the firm during a preliminary investigation. Salespeople and sales managers, brand managers, senior marketing executives, and other top marketing and nonmarketing personnel have considerable experience and vast amounts of expertise.

Interviews with People Outside the Firm

Researchers prefer not to go outside the firm to conduct interviews unless they find it necessary. This process is more time-consuming and expensive, but these interviews can alert customers and competitors to problems and opportunities within the firm.

Despite these drawbacks, present and potential customers, suppliers, and even competitors undoubtedly can provide valuable data for the preliminary investigation. The most frequently used methods to collect these data are informal interviews and observation.

Informal interviews are more popular because they are simpler. They are used like interviews conducted with people inside the firm to obtain various people’s attitudes and opinions. The other method, observation, will be discussed later in this lesson.

Step-3: Weigh the Costs and Benefits of Formal Research

Very few issues are destined to be the subject of formal data collection. The researcher must determine whether further research is necessary or justified.

Step two may yield enough information for the executive to make the decisions without more formal research.

When enough information is not available, the researcher must determine whether the added study’s benefits would justify the costs.

A formal study’s costs must be determined, including data collection, data analysis , data interpretation, and report preparation and presentation. If the researcher believes that decision-makers could use additional information, the value of better information must be estimated.

Admittedly, the process of weighing the costs and benefits is somewhat subjective. It depends heavily on the estimates of the executive and researcher.

Step-4: Develop the Research Design

Once it has been decided that a formal research study is needed, detailed plans can be developed.

Among the most important questions are the following;

• How will the data be collected?
• How will respondents be selected? How many respondents will data be collected from?

Answers to these questions form the research design – the formal plans for the conduct of the study.

How will data be collected?

The initial decision in the development of a research design is the choice of a data collection method . Researchers usually use the survey, observational, or experimental method. Each approach has unique strengths and weaknesses.

Survey Method

Here researcher gathers data from only a portion of all the people it would be appropriate to collect data from. Those included in the survey are known as the sample, and the entire group is called the population.

Three specific techniques are used to collect data – personal, telephone, and mail interviews. Personal interviews involve a direct interface between the researcher and the interviewee or respondent.

Telephone interviews are another technique providing direct interaction between the researcher and the respondent, although telephone contact is only vocal.

Although rapport is harder to build over the telephone, it is still better than a mail survey. It also tends to be fairly inexpensive to administer since no travel is involved, and even long-distance calls are relatively cheap compared to personal interviews .

Finally, the telephone survey has the special advantage of speed, making it most appropriate when short.

Mail surveys are also popular in business research . Researchers send respondents printed questionnaires to complete and return within a specified period of time.

This technique is very efficient when respondents are dispersed geographically, as in a national survey.

Observation Method

This method allows the researcher to watch the actions (or listen to the words) of people or events to obtain the desired data. Normally, this is done within the people’s own environment without their knowledge.

Trained observers are needed here to ensure that the data is collected accurately and that people’s actions are properly interpreted. Additionally, the events they monitor have to occur with sufficient frequency to make this method feasible.

Finally, there are some ethical considerations for monitoring people without their knowledge or consent.

Experimental Method

Historically, this method has been used mostly in the natural sciences and not in business. With this method, the researcher tries to determine causes and effect relationships. By controlling some variables and varying others, the results can be measured and relationships identified.

Sample Size Determination

Deciding on sample size is one of the more important issues in the research design.

Although a census – interviewing all population members – is always preferable from an accurate viewpoint, it is usually not feasible. The costs involved and the difficulty in reaching everybody are just too great. Executives and researchers must trade accuracy for cost savings.

Most nonresearchers mistakenly believe that the sample size depends on the size of the sample population. Actually, the main determinant of sample size is how the sample population varies on the issues under study. The more they vary, the greater the sample size needed to obtain accurate data.

There are several formulas researchers use to determine sample size. One of the simplest is:

Sample Selection

Once the sample size has been determined, the researcher can plan for the sample selection.

This is an especially important element in the research design since the people selected might significantly impact the research results. The researcher’s objective is to make the sample just like the sample population in terms of its mean, median, and mode.

However, it is tough to obtain a sample that is a perfect miniature of the sample population.

The researcher has to select a sample that is as close as possible, given time and cost limitations. The researcher must decide between probability or nonprobability sampling plans as a method in selecting the sample.

Probability Samples

In a probability sampling plan , chance determines whether an individual member of the population is included or excluded from the sample.

The basic probability sampling plan is known as the simple random sample . Here, each sample population member has a known and equal chance of being included in the sample.

This plan is called simple, but it is not always so.

In fact, researchers frequently find it very difficult or expensive to obtain a full list of the population from where the sample is drawn. To reduce some of the problems associated with a simple random sample , an area cluster sample is often used, where a population is grouped into smaller units (clusters).

Then, some of those units are selected in a purely random manner. Finally, some of the members of the selected units are also chosen in a purely random fashion.

Although both the simple random and area cluster sampling plans are commonly used, neither can assure the researcher that the sample selected will represent the population.

To maximize the likelihood of obtaining a representative sample, a stratified sampling plan should be used.

In a stratified sampling plan, the population is grouped based on characteristics relevant to the study. Based on the size of each group, specified numbers will be randomly selected from each.

Nonprobability Samples

Although probability samples can be more exact because they eliminate interviewer bias in selecting respondents, they frequently are either too costly or impossible to use.

In those instances, researchers turn to nonprobability sampling plans, where they or others select the final sample instead of it being done on a random-chance basis.

The easiest nonprobability sampling plan for a researcher to use is a convenience sample. The researcher may choose people closest to each other or a group gathered in one place. No consideration is given to whether the sample group reflects the entire sample population.

To refine this method, a researcher will sometimes use a judgment sample, choosing respondents who are thought to match the population.

The most sophisticated nonprobability plan is the quota sample, similar to the stratified sample. The researcher identifies the population’s relevant characteristics and tries to select a roughly proportional sample.

If, for example, it is known that 51 percent of the population are men, the researcher would make sure that 51 percent of the sample selected are men.

Step-5: Develop the Questionnaire or Other Data Form

Although not all marketing research involves surveys, much of it does. Accordingly, the process of survey research will be described here. Developing a good data collection instrument or questionnaire is one of the more difficult tasks.

There are many different types of questionnaires . Initially, the researcher must decide whether to use one that is structured or unstructured.

If a personal or telephone interview is used, the most common is the structured questionnaire, where every question is worded and sequenced, and the interviewer does not depart from it at all. No other questions can be asked, nor different sequences be used.

An unstructured questionnaire contains a limited number of questions allowing the interviewer to vary the wording after the sequence or probe for more data based on the respondent’s answers.

The advantage is that the additional questions may obtain some valuable data.

Now we shall present some of the important issues in this regard;

Question Design

Each question must be carefully prepared, whether it is in a structured or unstructured questionnaire.

Most importantly, questions must be appropriately formed and worded for the specific data being sought. The researcher can use open-ended, dichotomous choice, or multiple-choice questions.

Open-ended questions allow the respondent to answer in their own words so that exact data can be collected. Dichotomous choice questions limit respondents to two choices – yes or no, agree or disagree, etc.

Multiple-choice questions force respondents to select one of several pre-established answers.

Question Sequencing

A questionnaire is not simply an assortment of questions that happened to be grouped. If they are improperly ordered, respondents may not answer any of the questions or not answer them accurately.

The questions are interrelated but must be sequenced logically to flow together, assisting the respondent in answering correctly and truthfully.

In general, questions should be ordered in the following manner :

• from easy to difficult
• from general to specific
• from insensitive to sensitive (or confidential)
• in groups by topical area
• with demographic questions toward the end

Questionnaire Design

A questionnaire consists of four parts: the introduction, the set of instructions to the interviewer and respondent, the set of questions, and the closing.

The introduction is especially important because it helps the interviewer gain rapport with the respondent. It also gives the respondent some general information on what the study is about and why it is being conducted.

Inexperienced researchers often ignore instructions . Interviewers and respondents need to know how the interview will proceed and how responses are recorded on the questionnaire.

The questions were discussed earlier, but a courteous closing is called for in deference to the respondent’s cooperation after the questions.

The physical layout is a final consideration in the questionnaire design. Proper use of white space, quality printing, and paper are all important.

Location and spaces for responses to the questions are also a concern and should be arranged to simplify transferring the data to punch cards or tape.

Step-6: Conduct the Formal Study

The formal study is a three-phase process.

• First, the questionnaire must be pre-tested to ensure that it is defect-free.
• Second, trained interviewers are needed to collect the data properly.
• Finally, the formal study can be conducted, but only after the first two phases have been completed.

Even the most experienced researcher pretests the questionnaire before using it in a formal study.

Omitting an important question, wording a question ambiguously, or making some other mistake is very easy. As a safeguard, the questionnaire is tested on a relatively small group of people.

When the questionnaire has been finalized, the interviewers – if they are using a personal or telephone survey – must be familiarized with the questionnaire and the overall study.

Interviewers need to know the type of people they will meet and the questionnaire they will use.

Finally, the beginning and end dates for the study must be established and adhered to.

Step-7: Analyze the Data and Report the Results

Once the data has been collected, the researcher can begin making an analysis. For relatively large studies, the data will be transferred from the questionnaires directly into a computer or recorded on punch cards or tape.

With small studies, it is common for the data to be tallied by hand, although this method is becoming less frequent.

The particular analysis conducted on the data depends on the study’s objectives.

The analysis will most often begin with a simple tabulation of the mean, median, mode, and frequencies. Although this is certainly the least sophisticated step, it frequently provides valuable information.

If a probability sampling plan has been used, further analysis through some of the higher-level statistical tests can be conducted, such as regression analysis, chi-square, correlation analysis, and analysis of variance.

Most of the quantitative analyses have been computerized to complete the actual computations quickly and easily.

Before the information obtained from the data analysis is sent to an executive, it is usually translated into a more useful form for decision­making purposes. The value of the entire project depends on how well the executive understands and uses the results.

Reports are usually prepared to describe the purpose, methodology, limitations, analysis, and study findings. Many executives demand the full report and an “Executive Summary” capsulizing the study in one or two pages.

Final Words

From time to time, marketers may be required to undertake marketing research to collect information on the market.

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Market Research: A How-To Guide and Template

Discover the different types of market research, how to conduct your own market research, and use a free template to help you along the way.

MARKET RESEARCH KIT

5 Research and Planning Templates + a Free Guide on How to Use Them in Your Market Research

Updated: 02/21/24

Published: 02/21/24

Today's consumers have a lot of power. As a business, you must have a deep understanding of who your buyers are and what influences their purchase decisions.

Enter: Market Research.

Whether you're new to market research or not, I created this guide to help you conduct a thorough study of your market, target audience, competition, and more. Let’s dive in.

Table of Contents

What is market research?

Primary vs. secondary research, types of market research, how to do market research, market research report template, market research examples.

Market research is the process of gathering information about your target market and customers to verify the success of a new product, help your team iterate on an existing product, or understand brand perception to ensure your team is effectively communicating your company's value effectively.

Market research can answer various questions about the state of an industry. But if you ask me, it's hardly a crystal ball that marketers can rely on for insights on their customers.

Market researchers investigate several areas of the market, and it can take weeks or even months to paint an accurate picture of the business landscape.

However, researching just one of those areas can make you more intuitive to who your buyers are and how to deliver value that no other business is offering them right now.

How? Consider these two things:

• Your competitors also have experienced individuals in the industry and a customer base. It‘s very possible that your immediate resources are, in many ways, equal to those of your competition’s immediate resources. Seeking a larger sample size for answers can provide a better edge.
• Your customers don't represent the attitudes of an entire market. They represent the attitudes of the part of the market that is already drawn to your brand.

The market research services market is growing rapidly, which signifies a strong interest in market research as we enter 2024. The market is expected to grow from roughly $75 billion in 2021 to $90.79 billion in 2025 .

Free Market Research Kit

• SWOT Analysis Template
• Survey Template
• Focus Group Template

You're all set!

Click this link to access this resource at any time.

Why do market research?

Market research allows you to meet your buyer where they are.

As our world becomes louder and demands more of our attention, this proves invaluable.

By understanding your buyer's problems, pain points, and desired solutions, you can aptly craft your product or service to naturally appeal to them.

Market research also provides insight into the following:

• Where your target audience and current customers conduct their product or service research
• Which of your competitors your target audience looks to for information, options, or purchases
• What's trending in your industry and in the eyes of your buyer
• Who makes up your market and what their challenges are
• What influences purchases and conversions among your target audience
• Consumer attitudes about a particular topic, pain, product, or brand
• Whether there‘s demand for the business initiatives you’re investing in
• Unaddressed or underserved customer needs that can be flipped into selling opportunity
• Attitudes about pricing for a particular product or service

Ultimately, market research allows you to get information from a larger sample size of your target audience, eliminating bias and assumptions so that you can get to the heart of consumer attitudes.

As a result, you can make better business decisions.

To give you an idea of how extensive market research can get , consider that it can either be qualitative or quantitative in nature — depending on the studies you conduct and what you're trying to learn about your industry.

Qualitative research is concerned with public opinion, and explores how the market feels about the products currently available in that market.

Quantitative research is concerned with data, and looks for relevant trends in the information that's gathered from public records.

That said, there are two main types of market research that your business can conduct to collect actionable information on your products: primary research and secondary research.

Primary Research

Primary research is the pursuit of first-hand information about your market and the customers within your market.

It's useful when segmenting your market and establishing your buyer personas.

Primary market research tends to fall into one of two buckets:

• Exploratory Primary Research: This kind of primary market research normally takes place as a first step — before any specific research has been performed — and may involve open-ended interviews or surveys with small numbers of people.
• Specific Primary Research: This type of research often follows exploratory research. In specific research, you take a smaller or more precise segment of your audience and ask questions aimed at solving a suspected problem.

Secondary Research

Secondary research is all the data and public records you have at your disposal to draw conclusions from (e.g. trend reports, market statistics, industry content, and sales data you already have on your business).

Secondary research is particularly useful for analyzing your competitors . The main buckets your secondary market research will fall into include:

• Public Sources: These sources are your first and most-accessible layer of material when conducting secondary market research. They're often free to find and review — like government statistics (e.g., from the U.S. Census Bureau ).
• Commercial Sources: These sources often come in the form of pay-to-access market reports, consisting of industry insight compiled by a research agency like Pew , Gartner , or Forrester .
• Internal Sources: This is the market data your organization already has like average revenue per sale, customer retention rates, and other historical data that can help you draw conclusions on buyer needs.
• Focus Groups
• Product/ Service Use Research
• Observation-Based Research
• Buyer Persona Research
• Market Segmentation Research
• Pricing Research
• Competitive Analysis Research
• Customer Satisfaction and Loyalty Research
• Brand Awareness Research
• Campaign Research

1. Interviews

Interviews allow for face-to-face discussions so you can allow for a natural flow of conversation. Your interviewees can answer questions about themselves to help you design your buyer personas and shape your entire marketing strategy.

2. Focus Groups

Focus groups provide you with a handful of carefully-selected people that can test out your product and provide feedback. This type of market research can give you ideas for product differentiation.

3. Product/Service Use Research

Product or service use research offers insight into how and why your audience uses your product or service. This type of market research also gives you an idea of the product or service's usability for your target audience.

4. Observation-Based Research

Observation-based research allows you to sit back and watch the ways in which your target audience members go about using your product or service, what works well in terms of UX , and which aspects of it could be improved.

5. Buyer Persona Research

Buyer persona research gives you a realistic look at who makes up your target audience, what their challenges are, why they want your product or service, and what they need from your business or brand.

6. Market Segmentation Research

Market segmentation research allows you to categorize your target audience into different groups (or segments) based on specific and defining characteristics. This way, you can determine effective ways to meet their needs.

7. Pricing Research

Pricing research helps you define your pricing strategy . It gives you an idea of what similar products or services in your market sell for and what your target audience is willing to pay.

8. Competitive Analysis

Competitive analyses give you a deep understanding of the competition in your market and industry. You can learn about what's doing well in your industry and how you can separate yourself from the competition .

9. Customer Satisfaction and Loyalty Research

Customer satisfaction and loyalty research gives you a look into how you can get current customers to return for more business and what will motivate them to do so (e.g., loyalty programs , rewards, remarkable customer service).

10. Brand Awareness Research

Brand awareness research tells you what your target audience knows about and recognizes from your brand. It tells you about the associations people make when they think about your business.

11. Campaign Research

Campaign research entails looking into your past campaigns and analyzing their success among your target audience and current customers. The goal is to use these learnings to inform future campaigns.

• Define your buyer persona.
• Identify a persona group to engage.
• Prepare research questions for your market research participants.
• List your primary competitors.
• Summarize your findings.

1. Define your buyer persona.

You have to understand who your customers are and how customers in your industry make buying decisions.

This is where your buyer personas come in handy. Buyer personas — sometimes referred to as marketing personas — are fictional, generalized representations of your ideal customers.

Use a free tool to create a buyer persona that your entire company can use to market, sell, and serve better.

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How to do market research in 4 steps: a lean approach to marketing research

From pinpointing your target audience and assessing your competitive advantage, to ongoing product development and customer satisfaction efforts, market research is a practice your business can only benefit from.

Learn how to conduct quick and effective market research using a lean approach in this article full of strategies and practical examples. 

Last updated

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A comprehensive (and successful) business strategy is not complete without some form of market research—you can’t make informed and profitable business decisions without truly understanding your customer base and the current market trends that drive your business.

In this article, you’ll learn how to conduct quick, effective market research  using an approach called 'lean market research'. It’s easier than you might think, and it can be done at any stage in a product’s lifecycle.

How to conduct lean market research in 4 steps

What is market research, why is market research so valuable, advantages of lean market research, 4 common market research methods, 5 common market research questions, market research faqs.

We’ll jump right into our 4-step approach to lean market research. To show you how it’s done in the real world, each step includes a practical example from Smallpdf , a Swiss company that used lean market research to reduce their tool’s error rate by 75% and boost their Net Promoter Score® (NPS) by 1%.

Research your market the lean way...

From on-page surveys to user interviews, Hotjar has the tools to help you scope out your market and get to know your customers—without breaking the bank.

The following four steps and practical examples will give you a solid market research plan for understanding who your users are and what they want from a company like yours.

1. Create simple user personas

A user persona is a semi-fictional character based on psychographic and demographic data from people who use websites and products similar to your own. Start by defining broad user categories, then elaborate on them later to further segment your customer base and determine your ideal customer profile .

How to get the data: use on-page or emailed surveys and interviews to understand your users and what drives them to your business.

How to do it right: whatever survey or interview questions you ask, they should answer the following questions about the customer:

Who are they?

What is their main goal?

What is their main barrier to achieving this goal?

Pitfalls to avoid:

Don’t ask too many questions! Keep it to five or less, otherwise you’ll inundate them and they’ll stop answering thoughtfully.

Don’t worry too much about typical demographic questions like age or background. Instead, focus on the role these people play (as it relates to your product) and their goals.

How Smallpdf did it: Smallpdf ran an on-page survey for a couple of weeks and received 1,000 replies. They learned that many of their users were administrative assistants, students, and teachers.

Next, they used the survey results to create simple user personas like this one for admins:

Who are they? Administrative Assistants.

What is their main goal? Creating Word documents from a scanned, hard-copy document or a PDF where the source file was lost.

What is their main barrier to achieving it? Converting a scanned PDF doc to a Word file.

💡Pro tip: Smallpdf used Hotjar Surveys to run their user persona survey. Our survey tool helped them avoid the pitfalls of guesswork and find out who their users really are, in their own words. 

You can design a survey and start running it in minutes with our easy-to-use drag and drop builder. Customize your survey to fit your needs, from a sleek one-question pop-up survey to a fully branded questionnaire sent via email. 

We've also created 40+ free survey templates that you can start collecting data with, including a user persona survey like the one Smallpdf used.

2. Conduct observational research

Observational research involves taking notes while watching someone use your product (or a similar product).

Overt vs. covert observation

Overt observation involves asking customers if they’ll let you watch them use your product. This method is often used for user testing and it provides a great opportunity for collecting live product or customer feedback .

Covert observation means studying users ‘in the wild’ without them knowing. This method works well if you sell a type of product that people use regularly, and it offers the purest observational data because people often behave differently when they know they’re being watched. 

Tips to do it right:

Record an entry in your field notes, along with a timestamp, each time an action or event occurs.

Make note of the users' workflow, capturing the ‘what,’ ‘why,’ and ‘for whom’ of each action.

Don’t record identifiable video or audio data without consent. If recording people using your product is helpful for achieving your research goal, make sure all participants are informed and agree to the terms.

Don’t forget to explain why you’d like to observe them (for overt observation). People are more likely to cooperate if you tell them you want to improve the product.

💡Pro tip: while conducting field research out in the wild can wield rewarding results, you can also conduct observational research remotely. Hotjar Recordings is a tool that lets you capture anonymized user sessions of real people interacting with your website. 

Observe how customers navigate your pages and products to gain an inside look into their user behavior . This method is great for conducting exploratory research with the purpose of identifying more specific issues to investigate further, like pain points along the customer journey and opportunities for optimizing conversion .

With Hotjar Recordings you can observe real people using your site without capturing their sensitive information

How Smallpdf did it: here’s how Smallpdf observed two different user personas both covertly and overtly.

Observing students (covert): Kristina Wagner, Principle Product Manager at Smallpdf, went to cafes and libraries at two local universities and waited until she saw students doing PDF-related activities. Then she watched and took notes from a distance. One thing that struck her was the difference between how students self-reported their activities vs. how they behaved (i.e, the self-reporting bias). Students, she found, spent hours talking, listening to music, or simply staring at a blank screen rather than working. When she did find students who were working, she recorded the task they were performing and the software they were using (if she recognized it).

Observing administrative assistants (overt): Kristina sent emails to admins explaining that she’d like to observe them at work, and she asked those who agreed to try to batch their PDF work for her observation day. While watching admins work, she learned that they frequently needed to scan documents into PDF-format and then convert those PDFs into Word docs. By observing the challenges admins faced, Smallpdf knew which products to target for improvement.

“Data is really good for discovery and validation, but there is a bit in the middle where you have to go and find the human.”

3. Conduct individual interviews

Interviews are one-on-one conversations with members of your target market. They allow you to dig deep and explore their concerns, which can lead to all sorts of revelations.

Listen more, talk less. Be curious.

Act like a journalist, not a salesperson. Rather than trying to talk your company up, ask people about their lives, their needs, their frustrations, and how a product like yours could help.

Ask "why?" so you can dig deeper. Get into the specifics and learn about their past behavior.

Record the conversation. Focus on the conversation and avoid relying solely on notes by recording the interview. There are plenty of services that will transcribe recorded conversations for a good price (including Hotjar!).

Avoid asking leading questions , which reveal bias on your part and pushes respondents to answer in a certain direction (e.g. “Have you taken advantage of the amazing new features we just released?).

Don't ask loaded questions , which sneak in an assumption which, if untrue, would make it impossible to answer honestly. For example, we can’t ask you, “What did you find most useful about this article?” without asking whether you found the article useful in the first place.

Be cautious when asking opinions about the future (or predictions of future behavior). Studies suggest that people aren’t very good at predicting their future behavior. This is due to several cognitive biases, from the misguided exceptionalism bias (we’re good at guessing what others will do, but we somehow think we’re different), to the optimism bias (which makes us see things with rose-colored glasses), to the ‘illusion of control’ (which makes us forget the role of randomness in future events).

How Smallpdf did it: Kristina explored her teacher user persona by speaking with university professors at a local graduate school. She learned that the school was mostly paperless and rarely used PDFs, so for the sake of time, she moved on to the admins.

A bit of a letdown? Sure. But this story highlights an important lesson: sometimes you follow a lead and come up short, so you have to make adjustments on the fly. Lean market research is about getting solid, actionable insights quickly so you can tweak things and see what works.

💡Pro tip: to save even more time, conduct remote interviews using an online user research service like Hotjar Engage , which automates the entire interview process, from recruitment and scheduling to hosting and recording.

You can interview your own customers or connect with people from our diverse pool of 200,000+ participants from 130+ countries and 25 industries. And no need to fret about taking meticulous notes—Engage will automatically transcribe the interview for you.

4. Analyze the data (without drowning in it)

The following techniques will help you wrap your head around the market data you collect without losing yourself in it. Remember, the point of lean market research is to find quick, actionable insights.

A flow model is a diagram that tracks the flow of information within a system. By creating a simple visual representation of how users interact with your product and each other, you can better assess their needs.

You’ll notice that admins are at the center of Smallpdf’s flow model, which represents the flow of PDF-related documents throughout a school. This flow model shows the challenges that admins face as they work to satisfy their own internal and external customers.

Affinity diagram

An affinity diagram is a way of sorting large amounts of data into groups to better understand the big picture. For example, if you ask your users about their profession, you’ll notice some general themes start to form, even though the individual responses differ. Depending on your needs, you could group them by profession, or more generally by industry.

We wrote a guide about how to analyze open-ended questions to help you sort through and categorize large volumes of response data. You can also do this by hand by clipping up survey responses or interview notes and grouping them (which is what Kristina does).

“For an interview, you will have somewhere between 30 and 60 notes, and those notes are usually direct phrases. And when you literally cut them up into separate pieces of paper and group them, they should make sense by themselves.”

Pro tip: if you’re conducting an online survey with Hotjar, keep your team in the loop by sharing survey responses automatically via our Slack and Microsoft Team integrations. Reading answers as they come in lets you digest the data in pieces and can help prepare you for identifying common themes when it comes time for analysis.

Hotjar lets you easily share survey responses with your team

Customer journey map

A customer journey map is a diagram that shows the way a typical prospect becomes a paying customer. It outlines their first interaction with your brand and every step in the sales cycle, from awareness to repurchase (and hopefully advocacy).

The above  customer journey map , created by our team at Hotjar, shows many ways a customer might engage with our tool. Your map will be based on your own data and business model.

📚 Read more: if you’re new to customer journey maps, we wrote this step-by-step guide to creating your first customer journey map in 2 and 1/2 days with free templates you can download and start using immediately.

Next steps: from research to results

So, how do you turn market research insights into tangible business results? Let’s look at the actions Smallpdf took after conducting their lean market research: first they implemented changes, then measured the impact.

Implement changes

Based on what Smallpdf learned about the challenges that one key user segment (admins) face when trying to convert PDFs into Word files, they improved their ‘PDF to Word’ conversion tool.

We won’t go into the details here because it involves a lot of technical jargon, but they made the entire process simpler and more straightforward for users. Plus, they made it so that their system recognized when you drop a PDF file into their ‘Word to PDF’ converter instead of the ‘PDF to Word’ converter, so users wouldn’t have to redo the task when they made that mistake. 

In other words: simple market segmentation for admins showed a business need that had to be accounted for, and customers are happier overall after Smallpdf implemented an informed change to their product.

Measure results

According to the Lean UX model, product and UX changes aren’t retained unless they achieve results.

Smallpdf’s changes produced:

A 75% reduction in error rate for the ‘PDF to Word’ converter

A 1% increase in NPS

Greater confidence in the team’s marketing efforts

"With all the changes said and done, we've cut our original error rate in four, which is huge. We increased our NPS by +1%, which isn't huge, but it means that of the users who received a file, they were still slightly happier than before, even if they didn't notice that anything special happened at all.”

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Market research (or marketing research) is any set of techniques used to gather information and better understand a company’s target market. This might include primary research on brand awareness and customer satisfaction or secondary market research on market size and competitive analysis. Businesses use this information to design better products, improve user experience, and craft a marketing strategy that attracts quality leads and improves conversion rates.

David Darmanin, one of Hotjar’s founders, launched two startups before Hotjar took off—but both companies crashed and burned. Each time, he and his team spent months trying to design an amazing new product and user experience, but they failed because they didn’t have a clear understanding of what the market demanded.

With Hotjar, they did things differently . Long story short, they conducted market research in the early stages to figure out what consumers really wanted, and the team made (and continues to make) constant improvements based on market and user research.

Without market research, it’s impossible to understand your users. Sure, you might have a general idea of who they are and what they need, but you have to dig deep if you want to win their loyalty.

Here’s why research matters:

Obsessing over your users is the only way to win. If you don’t care deeply about them, you’ll lose potential customers to someone who does.

Analytics gives you the ‘what’, while research gives you the ‘why’. Big data, user analytics , and dashboards can tell you what people do at scale, but only research can tell you what they’re thinking and why they do what they do. For example, analytics can tell you that customers leave when they reach your pricing page, but only research can explain why.

Research beats assumptions, trends, and so-called best practices. Have you ever watched your colleagues rally behind a terrible decision? Bad ideas are often the result of guesswork, emotional reasoning, death by best practices , and defaulting to the Highest Paid Person’s Opinion (HiPPO). By listening to your users and focusing on their customer experience , you’re less likely to get pulled in the wrong direction.

Research keeps you from planning in a vacuum. Your team might be amazing, but you and your colleagues simply can’t experience your product the way your customers do. Customers might use your product in a way that surprises you, and product features that seem obvious to you might confuse them. Over-planning and refusing to test your assumptions is a waste of time, money, and effort because you’ll likely need to make changes once your untested business plan gets put into practice.

Lean User Experience (UX) design is a model for continuous improvement that relies on quick, efficient research to understand customer needs and test new product features.

Lean market research can help you become more...

Efficient: it gets you closer to your customers, faster.

Cost-effective: no need to hire an expensive marketing firm to get things started.

Competitive: quick, powerful insights can place your products on the cutting edge.

As a small business or sole proprietor, conducting lean market research is an attractive option when investing in a full-blown research project might seem out of scope or budget.

There are lots of different ways you could conduct market research and collect customer data, but you don’t have to limit yourself to just one research method. Four common types of market research techniques include surveys, interviews, focus groups, and customer observation.

Which method you use may vary based on your business type: ecommerce business owners have different goals from SaaS businesses, so it’s typically prudent to mix and match these methods based on your particular goals and what you need to know.

1. Surveys: the most commonly used

Surveys are a form of qualitative research that ask respondents a short series of open- or closed-ended questions, which can be delivered as an on-screen questionnaire or via email. When we asked 2,000 Customer Experience (CX) professionals about their company’s approach to research , surveys proved to be the most commonly used market research technique.

What makes online surveys so popular?  

They’re easy and inexpensive to conduct, and you can do a lot of data collection quickly. Plus, the data is pretty straightforward to analyze, even when you have to analyze open-ended questions whose answers might initially appear difficult to categorize.

We've built a number of survey templates ready and waiting for you. Grab a template and share with your customers in just a few clicks.

💡 Pro tip: you can also get started with Hotjar AI for Surveys to create a survey in mere seconds . Just enter your market research goal and watch as the AI generates a survey and populates it with relevant questions. 

Once you’re ready for data analysis, the AI will prepare an automated research report that succinctly summarizes key findings, quotes, and suggested next steps.

An example research report generated by Hotjar AI for Surveys

2. Interviews: the most insightful

Interviews are one-on-one conversations with members of your target market. Nothing beats a face-to-face interview for diving deep (and reading non-verbal cues), but if an in-person meeting isn’t possible, video conferencing is a solid second choice.

Regardless of how you conduct it, any type of in-depth interview will produce big benefits in understanding your target customers.

What makes interviews so insightful?

By speaking directly with an ideal customer, you’ll gain greater empathy for their experience , and you can follow insightful threads that can produce plenty of 'Aha!' moments.

3. Focus groups: the most unreliable

Focus groups bring together a carefully selected group of people who fit a company’s target market. A trained moderator leads a conversation surrounding the product, user experience, or marketing message to gain deeper insights.

What makes focus groups so unreliable?

If you’re new to market research, we wouldn’t recommend starting with focus groups. Doing it right is expensive , and if you cut corners, your research could fall victim to all kinds of errors. Dominance bias (when a forceful participant influences the group) and moderator style bias (when different moderator personalities bring about different results in the same study) are two of the many ways your focus group data could get skewed.

4. Observation: the most powerful

During a customer observation session, someone from the company takes notes while they watch an ideal user engage with their product (or a similar product from a competitor).

What makes observation so clever and powerful?

‘Fly-on-the-wall’ observation is a great alternative to focus groups. It’s not only less expensive, but you’ll see people interact with your product in a natural setting without influencing each other. The only downside is that you can’t get inside their heads, so observation still isn't a recommended replacement for customer surveys and interviews.

The following questions will help you get to know your users on a deeper level when you interview them. They’re general questions, of course, so don’t be afraid to make them your own.

1. Who are you and what do you do?

How you ask this question, and what you want to know, will vary depending on your business model (e.g. business-to-business marketing is usually more focused on someone’s profession than business-to-consumer marketing).

It’s a great question to start with, and it’ll help you understand what’s relevant about your user demographics (age, race, gender, profession, education, etc.), but it’s not the be-all-end-all of market research. The more specific questions come later.

2. What does your day look like?

This question helps you understand your users’ day-to-day life and the challenges they face. It will help you gain empathy for them, and you may stumble across something relevant to their buying habits.

3. Do you ever purchase [product/service type]?

This is a ‘yes or no’ question. A ‘yes’ will lead you to the next question.

4. What problem were you trying to solve or what goal were you trying to achieve?

This question strikes to the core of what someone’s trying to accomplish and why they might be willing to pay for your solution.

5. Take me back to the day when you first decided you needed to solve this kind of problem or achieve this goal.

This is the golden question, and it comes from Adele Revella, Founder and CEO of Buyer Persona Institute . It helps you get in the heads of your users and figure out what they were thinking the day they decided to spend money to solve a problem.

If you take your time with this question, digging deeper where it makes sense, you should be able to answer all the relevant information you need to understand their perspective.

“The only scripted question I want you to ask them is this one: take me back to the day when you first decided that you needed to solve this kind of problem or achieve this kind of a goal. Not to buy my product, that’s not the day. We want to go back to the day that when you thought it was urgent and compelling to go spend money to solve a particular problem or achieve a goal. Just tell me what happened.”

— Adele Revella , Founder/CEO at Buyer Persona Institute

Bonus question: is there anything else you’d like to tell me?

This question isn’t just a nice way to wrap it up—it might just give participants the opportunity they need to tell you something you really need to know.

That’s why Sarah Doody, author of UX Notebook , adds it to the end of her written surveys.

“I always have a last question, which is just open-ended: “Is there anything else you would like to tell me?” And sometimes, that’s where you get four paragraphs of amazing content that you would never have gotten if it was just a Net Promoter Score [survey] or something like that.”

What is the difference between qualitative and quantitative research?

Qualitative research asks questions that can’t be reduced to a number, such as, “What is your job title?” or “What did you like most about your customer service experience?” 

Quantitative research asks questions that can be answered with a numeric value, such as, “What is your annual salary?” or “How was your customer service experience on a scale of 1-5?”

 → Read more about the differences between qualitative and quantitative user research .

How do I do my own market research?

You can do your own quick and effective market research by 

Surveying your customers

Building user personas

Studying your users through interviews and observation

Wrapping your head around your data with tools like flow models, affinity diagrams, and customer journey maps

What is the difference between market research and user research?

Market research takes a broad look at potential customers—what problems they’re trying to solve, their buying experience, and overall demand. User research, on the other hand, is more narrowly focused on the use (and usability ) of specific products.

What are the main criticisms of market research?

Many marketing professionals are critical of market research because it can be expensive and time-consuming. It’s often easier to convince your CEO or CMO to let you do lean market research rather than something more extensive because you can do it yourself. It also gives you quick answers so you can stay ahead of the competition.

Do I need a market research firm to get reliable data?

Absolutely not! In fact, we recommend that you start small and do it yourself in the beginning. By following a lean market research strategy, you can uncover some solid insights about your clients. Then you can make changes, test them out, and see whether the results are positive. This is an excellent strategy for making quick changes and remaining competitive.

Net Promoter, Net Promoter System, Net Promoter Score, NPS, and the NPS-related emoticons are registered trademarks of Bain & Company, Inc., Fred Reichheld, and Satmetrix Systems, Inc.

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Module 6: Marketing Information and Research

The marketing research process, learning objectives.

• Identify the steps of conducting a marketing research project

A Standard Approach to Research Inquiries

Marketing research is a useful and necessary tool for helping marketers and an organization’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 is important for any marketer to be familiar with the basic procedures and techniques of marketing research.

It is 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 the proposals made by research specialists. They are also in a better position to evaluate their findings and recommendations.

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.

Step 1: Identify the Problem

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’s time and money?

It’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 problem you really need to solve is not the same problem that appears on the surface. Collaborating with 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 the time or resources to investigate everything you want.

To flesh out your understanding of the problem, it’s useful to begin brainstorming actual research questions you want to explore. What are the questions you need to answer in order to get to the research 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 will frame your research inquiry. You will revisit these research questions later in the process, but when you’re getting started, 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.

Applied Example: Marketing Research for Bookends

To illustrate the marketing research process, let’s return to Uncle Dan and his ailing bookstore, Bookends. You need a lot of information if you’re going to help Dan turn things around, so marketing research is a good idea. You begin by identifying the problem and then work to set down your research objectives and initial research questions:

Step 2: Develop a Research Plan

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’ products, or insight about what will make prospective customers notice you? When do need the information, and what’s the time frame for getting it? What budget and resources are available?

Once you have clarified what kind of information you need and the timing and budget for your project, you can develop the research design. This details how you plan to collect and analyze the information you’re after. Some types of information are readily available through  secondary research and secondary data 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 from talking directly to customers about your research questions. This is known as primary research , which collects primary data captured expressly for your research inquiry.   Marketing research projects may include secondary research, primary research, or both.

Depending on your objectives and budget, sometimes a small-scale project will be enough to get the 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—both primary and secondary data—and 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.)

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 expertise.

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. At 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.

Finally, the research plan indicates who will interpret the research findings and how the findings will 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, senior 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 the research plan is recommended to make sure that they are comfortable with the approach and receptive to the potential findings.

Applied Example: A Bookends Research Plan

You 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 answers to the research questions.

Dan is enthusiastic, but he’s also short on money. You realize that such a financial constraint will limit what’s possible, but with Dan’s help you can do something worthwhile. Below is the research plan you sketch out:

Step 3: Conduct the Research

Conducting research can be a fun and exciting part of the marketing research process. After struggling with the gaps in your knowledge of market dynamics—which led you to embark on a marketing research project in the first place—now things are about to change. Conducting research begins to generate information that helps answer your urgent marketing questions.

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 nearly always cheaper than capturing new information on your own. Your marketing research project should benefit from prior work wherever possible.

After 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 the 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.

Without proper techniques, you may inadvertently get bad data or discover bias in the responses that distorts the results and points you in the wrong direction. The module on Marketing Research Techniques discusses these issues in further detail, since the procedures for getting reliable data vary by research method.

Applied Example: Getting the Data on Bookends

Dan 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).

You visit the U.S. Census Bureau Web site to download demographic data about your metro area. The data show all zip codes in the area, along with population size, gender breakdown, age ranges, income, and education levels.

The next part of 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.

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.

Step 4: Analyze and Report Findings

Analyzing the 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—usually a presentation or detailed report.

Analysis starts with formatting, cleaning, and editing the data to make sure that it’s suitable 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 to 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 regression 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 social media posts to provide context and meaning around what people say and do.

Good analysis is important because the interpretation of research data—the “so what?” factor—depends 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 key findings and takeaways that managers should remember from the research? What are the market segments you’ve identified, and which ones should you target?  What are the primary reasons your customers choose your competitor’s product over yours, and what does this mean for future improvements to your product?

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 recommendations from the research findings. Marketing research reports incorporate both analysis and interpretation of data to address the project objectives.

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 slide presentation is the preferred format for initially sharing research results with internal stakeholders. Particularly for large, complex projects, a written report may be a better format for discussing detailed findings and nuances in the data, which managers can study and reference in the future.

Applied Example: Analysis and Insights for Bookends

Getting 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 several demographic 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 Bookends.

Gradually a 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, a couple of higher-priority segments—based on their spending levels, proximity, and loyalty to Bookends—stand out. You and your uncle are 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 new segments you’d like to focus on.

Step 5: Take Action

Once the report is complete, the presentation is delivered, and the recommendations are made, the marketing research project is over, right? Wrong.

What comes next is arguably the most important step of all: taking action based on your research results.

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 “take action” step can galvanize the team to move further and faster in that same direction.

Things are not so simple when the research results indicate a 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 think deeply about the new approach and carefully map strategies, tactics, and available resources to plan effectively. 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.

It is worth mentioning that many marketing research projects are never translated into management action. Sometimes this is because the report 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 specific suggestions for translating 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 them.

Applied Example: Bookends’ New Customer Campaign

Your research findings and recommendations identified three segments for Bookends to focus on. Based on the demographics, lifestyle, and spending patterns found during your marketing 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.

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?

Even though Bookends is a real-life project with serious consequences for your uncle Dan, it’s also a fun laboratory where you can test out some of the principles you’re learning in your marketing class. You’re figuring out quickly what it’s like to be a marketer.

Well done, rookie!

Check Your Understanding

Answer the question(s) below to see how well you understand the topics covered in this outcome. This short quiz does  not  count toward your grade in the class, and you can retake it an unlimited number of times.

Use this quiz to check your understanding and decide whether to (1) study the previous section further or (2) move on to the next section.

• Revision and Adaptation. Authored by : Lumen Learning. License : CC BY: Attribution
• Chapter 3: Marketing Research: An Aid to Decision Making, from Introducing Marketing. Authored by : John Burnett. Provided by : Global Text. Located at : http://solr.bccampus.ca:8001/bcc/file/ddbe3343-9796-4801-a0cb-7af7b02e3191/1/Core%20Concepts%20of%20Marketing.pdf . License : CC BY: Attribution
• Urban life (Version 2.0). Authored by : Ian D. Keating. Located at : https://www.flickr.com/photos/ian-arlett/19313315520/ . License : CC BY: Attribution

• Site Building
• Quick Reads
• About Academy
• Perspectives
• Introduction to Market Research: When and How to Start

• Introduction to Market Research: What It Is and Why You Need It
• Conducting a Situation Analysis: The SWOT Analysis
• Using Your SWOT Analysis to Drive Your Market Research
• Conducting Competitor Research 
• Resource List for Secondary Market Research
• Conducting Primary Market Research
• Creating a Killer Market Research Survey
• Using In-Depth Interviews and Focus Groups for Your Market Research
• Best Practices for Moderating and Analyzing Interviews and Focus Groups
• Conducting Observational Research for Your Business

Welcome back to our introduction to market research! As you probably remember, we first introduced the idea of market research by comparing it to solving a mystery. Though the end results are different (we imagine your market research won’t conclude with someone shouting “Mr. Green, in the Library, with the Candlestick!”), the basic processes are the same:

• First, you’ll need to identify the question (or questions) you need answered
• Then, methodically gather the clues you need
• Finally, compile what you’ve learned to form the entire picture

In part one, we discussed what market research is, and why it’s so vital to steering a successful business, launching a new product, and staying a step ahead of your competition. Now, let’s talk about the importance of timing, and give you an overview of the process—the “when” and the “how.”

When should you start researching your market?

One way to answer this question is to simply say: “At every stage of your business journey.” However, the answer should be more complex than that, and it’s always useful to have examples. Maybe you’ll recognize your current stage of business and think, Now is my moment .

Before you open your business

It’s incredibly helpful to do market research before even launching your business. It will help you answer some fundamental questions, like, “is there even a market available for my product?” or “is this market big enough to sustain my business over the long haul?”

Doing market research in the early stages also helps you establish “the four Ps”:

• Product: Gather clear data on customer pain points, needs, and buying habits. This consumer information will help you consider aspects of functionality, features, appearance, and more to produce the most valuable and desirable products or services for your target market.
• Price: Carefully consider the price point of your product or service here. Through market research, you should gather data on factors like competitors’ prices, common profit margins, and knowledge of what your market is willing to pay. This way, you can make informed decisions not only on your product price, but also on things like shipping and handling fees, returns, and financing options.
• Place: You’ll need to consider place in regards to many areas of business. After all, you’ll have to decide where your product will be manufactured, where it’ll be stored before it sells, where you’ll set up points of sale (online, retail, wholesale), where you’ll advertise, and even where the product will be placed in a merchandise or webpage display. Sounds exhausting, right? Don’t worry—market research will help you decide each of these things.
• Promotion: Finally, market research will help you determine the most effective strategies for advertising, marketing, and sales to drive traffic to your business. It will clarify, for instance, whether you should invest in promoting your products on social media, or can rely on organic traffic. It will give you insight into which channels to utilize to reach your market segments, and what language and tone to use in your promotions.

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As your business grows

After you’ve launched your business, you’ll want to do market research as frequently as possible—or at least, as frequently as is valuable. Continual research will keep your finger on the pulse of your industry, so you can recognize shifts and changes before your competition does. Consumer demand isn’t static, and neither is our economy or your competitors’ marketing strategies, products, or financial numbers. Staying in the know will keep your business agile and ready for any changes.

Market research will also help you answer the questions that come up as your business matures:

• What’s current the perception of our customer service right now, and how could it be improved?
• How can we earn brand loyalty and repeat business from new customers?
• What opportunities do I have to increase sales with existing customers?

Research before you pivot

Finally, it’s essential to conduct market research any time you’re considering making a change in your business. Whether you’re…

• Considering introducing a new service or offering a new product
• Opening an online store or a new brick-and-mortar location
• Changing your prices
• Launching a new ad campaign
• Redesigning your logo and branding
• Increasing production levels
• Choosing new vendors for your shipping
• …Or embarking on any number of other changes to your business or products

The bottom line is the same: Market research will help you anticipate whether the proposed change is truly a viable opportunity for your business.

The “how” of market research: phases and methods

Now that you know a bit about what market research is, why you should use it, and when it’s important, you’re ready for the real action: how you can actually do it. We’ll cover the basics here, and then really dig into the details in the rest of this guide.

As we see it, there are four steps to conducting market research:

• Make a plan . To get an answer, you’ll need to start with a question. Formulate the questions you need answered so you know what you’re looking for.
• Determine your data sources . Once you have your questions, you’ll know who to ask, or where to look, for the answers. Determine what sources and methods you can use to gather the information you need.
• Collect the data . Whether you’re sending out surveys , interviewing top consumers, or studying a competitor, be methodical and be precise. Record everything you learn and organize your data to be sure you get the whole picture.
• Analyze the data. Once you have the facts, analyze what you’ve learned and draw your conclusions. You have your answer now, so go ahead and act on it!

Of course, this is a cyclical process. The questions you formulate in your market research plan this month might be very different from the ones you formulate six months down the road to optimize a different aspect of your business.

Getting the data you need

Our third step here—data collection—will be the most time-consuming phase of your research. Your methods of data collection (and your data sources) are probably many. Don’t worry, because we’ve got more information and advice for you about data collection later on in this guide.

There are hundreds of types of market research out there, but the most common methods fall into these categories:

• In-depth interviews
• Focus groups
• Observation
• Secondary research (including competitor research )

The first four items on that list are all different forms of primary research . We’ll dive into more detail about each of them soon.

Where to start

The complexity and depth of your own research efforts will depend on many factors, including (but not limited to):

• What questions you want answered
• The type of business you run
• The nature of your industry and market
• Whether your business model is complex or straightforward
• How much time, effort, and money you can spend on your research

If you own a restaurant, for example, you’d probably want to start researching the quality of your food, your customer service, and the special options you offer, all in comparison with your local competitors. On the other hand, a software company will have a very different focus in their research.

Our final recommendation before diving in is that you don’t just do market research because you think you have to. Research your market because it will help you refine your business strategies, maximize the potential of your current activities, and create a plausible, data-driven roadmap for future growth. But most of all, do it because you care about your audience and your customers, because you want to learn more about them, and because you want to serve them better.

If you do your research well, with both kinds of care (concern for your prospects and attention to the process), your ROI will far surpass the expenses of the research itself.

The most valuable thing you can do for your business before diving into market research is to take an honest look at where you are—where you’re succeeding and where you could improve. Then, set your goals based on this candid assessment. In our next section, we’ll show you how to conduct a situation analysis to prepare for the first phase of market research.

Lydia Melby

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2 (page 16) p. 16 Marketing research

• Published: February 2021
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This chapter examines marketing research, one of the most engaging parts of marketing, as it is the opportunity for organizations to evaluate marketing performance, uncover customer behaviours, and explore their preferences. Marketing research covers a range of activities which may be positioned as either problem-identification research or problem-solving research. Sources of data and information for marketing research include secondary or desk research; primary or field data; quantitative data; and qualitative data. Meanwhile, marketing research methods are reviewed including surveys and questionnaires; focus groups and interviews; experiments and observations; and neuromarketing. The chapter then considers how sampling is widely used in primary research. It also looks at customer insights and big data.

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Home » Marketing Management » Marketing Research – Definition, Importance and Process

Marketing Research – Definition, Importance and Process

Definition of marketing research.

Marketing research is a key to the evolution of successful marketing strategies and programmes. It is an important tool to study buyer behavior, changes in consumer lifestyles and consumption patterns, brand loyalty and forecast market changes. Research is also used to study competition and analyze the competitor product’s positioning and how to gain competitive advantage . Recently, marketing research is being used to help create and enhance brand equity .

According to Philip Kotler , Marketing research is systematic problem analysis, model building and fact finding for the purposes of important decision making and control in the marketing of goods and services.

The important decision making related to market strategy and other tasks related to marketing depends on findings or marketing research. Marketing research process reduces the chances of errors, miss conceptions and uncertainty from decision making process . It is therefore very important to conduct marketing research to identify any changes in market environment, and understand customers and market. It means that this is the process of strategically importance.

Importance of Marketing Research

Marketing research is a systematic collection and analysis of data about market and the important quality of market. Therefore, Market research is an extremely part of any business that wants to offer products or service that are focused and well targeted. It also affects the profit of a business and makes the best return on marketing investment. For example, a product’s price elasticity research can help you to find out the true or correct information that impact of an increased price on the sales and the profits of a product. This special importance give on profitability also helps the company’s focus to shift from widen the sales to increase the profits of a company and helps the company to survive longer.

Research is about finding and gathers the information to learn about something that is not fully known. Marketing research is allows company to discover the facts whether customers or consumers is satisfy with it. And it also provides crucial information that may be affecting the business. In addition, Market research will also minimize the risk as it can help to shape a new product or service, and identifying what is needed and ensure that the development of a product is high level focused towards needs and wants.

Furthermore, market research also helps to identify opportunities. For example, if there is a plan to operate a new service and would like to have enough information or experience of the people’s attitudes then the market research can give not only evaluating new idea but also identify the areas where a marketing needs to develop and improve. To survive in competition of markets is not easily especially markets has been throughout the world. Marketing research helps to find out the true or correct information and understand the competitor such as their identity, the marketing network, what is customer focus on and the range of level operations. Other than that, with market research can also helps to understand the consumer needs that have not been met. Target markets is also one of the important points that marketers should take notes with, from marketing research it helps to decide the target markets and provide customer information in terms of their location, age, gender and buying behavior.

Besides that, marketing research helps to create benchmarks and prepare the plans carefully and take necessary measures and give opinion of the amount, value or quality for its performance. Moreover, marketing research is system that has been give devise more effective strategies. The most useful of marketing research is help to identify the potential problems and give ample time to discover the facts and to calculate an effective solution.

Marketing Research Process

There are seven steps in marketing research process: define the research problem, determine the research design, choose the method for collecting primary data, design the sample, collect the data, analyze and interpret the data, prepare the research report. Though those steps, marketers will make conversant decisions or reduce the risk of their decisions.

1. PROBLEM DEFINITION

This is the starting point in the marketing research exercise. Invariably, in any enterprise, there are several marketing issues that may require examination, and invariably every decision maker perceives his information need as being the most important. In problem definition it is important to be specific, avoiding ambiguities and generalities. Care should also be taken, not to define problems in too narrow a field as that may distract the researcher’s perspective. This may even affect creativity in the research.

2. RESEARCH OBJECTIVES

Once the problem is defined, the next logical step is to state what the researcher wants to achieve. This statement is called objectives. To be meaningful and help focus the researcher’s attention, these objectives should be specific, attainable & measurable. The purpose of these objectives is to act as a guide to the researcher and help him in maintaining a focus all through the research.

3. RESEARCH DESIGN

The third stage in the marketing research process is deciding on the research design. There are three types of research designs, namely:

• Exploratory: This kind of research is conducted when the researcher does not know how & why a certain phenomenon occurs, for example, how does the consumer evaluate the quality of a bank or a hotel or an airline? Since the prime goal of an exploratory research is to know the unknown, this research is unstructured. Focus groups, interviewing key customer groups, experts and even search for printed or published information are some common techniques.
• Descriptive: This research is carried out to describe a phenomenon or market characteristics. For example, a study to understand buyer behavior & describe characteristics of the target market is a descriptive research. Continuing the above example of service quality, a research done on how consumers evaluate the quality of competing service institutions can be considered as an example of descriptive research.
• Causative:  This kind of research is done to establish a cause and effect relationship, for example the influence of income & lifestyle on purchase decision. Here the researcher may like to see the effect of rising income & changing lifestyle on consumption of select products.

4. SOURCES OF DATA

Once the research design has been decided upon, the next stage is that of selecting the sources of data. Essentially there are two sources of data or information- secondary & primary

• Secondary data: This refers to the information that has been collected earlier by someone else. Often this includes printed or published reports, news items, industry or trade statistics etc. this also includes internal documents like invoices, sales reports, payment history of customers etc. these are important to the researcher as they provide an insight to the problem. Often the preliminary investigation is restricted to secondary data.
• Primary data: To overcome the limitations of incompatibility, obsolescence and bias, the researcher turns to the primary data. This is also resorted to when the secondary data is incomplete. Primary sources refer to data collected directly from the market place- customers, traders & suppliers often are the major sources. They are often reliable data sources and help in overcoming limitations of secondary data. The problem in primary data is its cost, both In terms of money & time, and often a researcher bias also creeps in.

5. DATA COLLECTION

The researcher is now ready to take the plunge. But still he or she needs to be clear about the following.

Procedure for data collection.

Data can be collected through any or combination of the following techniques.

• Observation: This technique involves observing how a customer behaves in the shopping area, how he or she dresses up & what does the customer say when he or she sees the product.
• Experimentation: This is a technique that involves experimenting new product ideas, advertising copies & campaigns, sales promotion ideas & even pricing & distribution strategies with the target customer group. These experiments can be conducted in an uncontrolled environment or in a controlled & simulated market environment.

Tools for data collection

The researcher has to decide on the appropriate tool for data collection. These tools are:-

• Questionnaire — used for the survey method
• Interview schedule — used mainly for exploratory research
• Association test — primarily used in qualitative research, also called as TAT (Thematic   Apperception Test)

6. DATA ANALYSIS

The next stage is that of data analysis .It is important to understand raw data has no usage in marketing research .hence appropriate analytical tools must be used. The most elementary is the arithmetic analysis using percentile and ratios. Statistical analysis like mean, median, mode, percentages, standard deviation and coefficient of correlations should be used wherever applicable

7. REPORT & PRESENTATION

The last stage is that of writing out a report and making a presentation to the Decision —maker. It is important that the report has summary, called the executive summary, giving a bird’s-eye view of the research. This is because most senior managers have little time for going through the entire report in depth. The executive summary can direct the reader’s attention to specific issues by turning to the relevant sections in the report and should not exceed thousand words.

The report should be structured and pages chronologically numbered generally, the structure of a good repot is somewhat like the following:

• Introduction to the problem
• Marketing research finding or survey findings
• Interpretation of research finding
• Policy implications

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What is a Marketing Research Report and How to Write It?

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Enjoy reading this blog post written by our experts or partners.

If you want to see what Databox can do for you, click here .

There is nothing more embarrassing for a marketer than to hear a client say “…this doesn’t quite address the business questions that we need to answer.” And unfortunately, this is a rather common occurrence in market research reporting that most marketers would care to admit.

So, why do most market research reports fail to meet client expectations? Well, in most cases, because there is more emphasis on methodology and analytic techniques used to craft the report rather than relying on data visualization, creative story-telling, and outlining actionable direction/steps.

Now, our next big question is, how do you avoid your client’s dreaded deer-in-the-headlights reaction when presenting such a report? This blog post will answer this and much more, as we go through the following:

What Is a Market Research Report?

Why is market research important, differences between primary and secondary market research, types of market research, market research reports advantages and disadvantages, how to do market research, how to prepare a market research report: 5 steps, marketing research report templates, marketing research reports best practices, bring your market research reports a step further with databox.

The purpose of creating a market research report is to make calculated decisions about business ideas. Market research is done to evaluate the feasibility of a new product or service, through research conducted with potential consumers. The information obtained from conducting market research is then documented in a formal report that should contain the following details:

• The characteristics of your ideal customers
• You customers buying habits
• The value your product or service can bring to those customers
• A list of your top competitors

Every business aims to provide the best possible product or service at the lowest cost possible. Simply said, market research is important because it helps you understand your customers and determine whether the product or service that you are about to launch is worth the effort.

Here is an example of a customer complaint that may result in more detailed market research:

Suppose you sell widgets, and you want your widget business to succeed over the long term. Over the years, you have developed many different ways of making widgets. But a couple of years ago, a customer complained that your widgets were made of a cheap kind of foam that fell apart after six months. You didn’t think at the time that this was a major problem, but now you know it.

The customer is someone you really want to keep. So, you decide to research this complaint. You set up a focus group of people who use widgets and ask them what they think about the specific problem. After the conducted survey you’ll get a better picture of customer opinions, so you can either decide to make the changes regarding widget design or just let it go.

PRO TIP: How Well Are Your Marketing KPIs Performing?

Like most marketers and marketing managers, you want to know how well your efforts are translating into results each month. How much traffic and new contact conversions do you get? How many new contacts do you get from organic sessions? How are your email campaigns performing? How well are your landing pages converting? You might have to scramble to put all of this together in a single report, but now you can have it all at your fingertips in a single Databox dashboard.

Our Marketing Overview Dashboard includes data from Google Analytics 4 and HubSpot Marketing with key performance metrics like:

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• New Contacts from Sessions . How well is your campaign driving new contacts and customers?
• Marketing Performance KPIs . Tracking the number of MQLs, SQLs, New Contacts and similar will help you identify how your marketing efforts contribute to sales.
• Email Performance . Measure the success of your email campaigns from HubSpot. Keep an eye on your most important email marketing metrics such as number of sent emails, number of opened emails, open rate, email click-through rate, and more.
• Blog Posts and Landing Pages . How many people have viewed your blog recently? How well are your landing pages performing?

Now you can benefit from the experience of our Google Analytics and HubSpot Marketing experts, who have put together a plug-and-play Databox template that contains all the essential metrics for monitoring your leads. It’s simple to implement and start using as a standalone dashboard or in marketing reports, and best of all, it’s free!

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Marketing research requires both primary and secondary market research. But what does that mean and what are the main differences?

Primary market research takes in information directly from customers, usually as participants in surveys. Usually, it is consisted of:

• Exploratory Primary Research – This type of research helps to identify possible problem areas, and it’s not focused on discovering specific information about customers. As with any research, exploratory primary research should be conducted carefully. Researchers need to craft an interviewing or surveying plan, and gather enough respondents to ensure reasonable levels of statistical reliability.
• Specific Primary Research – This type of research is one of the best ways to approach a problem because it relies on existing customer data. Specific research provides a deeper, more thorough understanding of the problem and its potential solutions. The greatest advantage of specific research is that it lets you explore a very specific question, and focus on a specific problem or an opportunity.

Secondary market research collects information from other sources such as databases, trend reports, market or government statistics, industry content, etc. We can divide secondary market research into 3 categories:

• Public market data – Public sources range from academic journals and government reports to tax returns and court documents. These sources aren’t always easy to find. Many are available only in print in libraries and archives. You have to look beyond search engines like Google to find public source documents.
• Commercial data – Those are typically created by specialized agencies like Pew, Gartner or Forrester. the research agencies are quite expensive, but they provide a lot of useful information.
• Internal data – Your organization’s databases are gold mines for market research. In the best cases, your salespeople can tell you what they think about customers. Your salespeople are your direct sources of information about the market. Don’t underestimate your internal data.

In general, primary research is more reliable than secondary research, because researchers have to interview people directly. But primary research is expensive and time-consuming. Secondary research can be quicker and less expensive.

There are plenty of ways to conduct marketing research reports. Mostly, the type of research done will depend on your goals. Here are some types of market research often conducted by marketers.

Focus Groups

Product/service use research, observation-based research, buyer persona research, market segmentation research, pricing research, competitive analysis research, customer satisfaction and loyalty research, brand awareness research, campaign research.

An interview is an interactive process of asking and answering questions and observing your respondent’s responses. Interviews are one of the most commonly used tools in market research . An interview allows an organization to observe, in detail, how its consumers interact with its products and services. It also allows an organization to address specific questions.

A focus group is a group of people who get together to discuss a particular topic. A moderator leads the discussion and takes notes. The main benefit of focus groups is that they are quick and easy to conduct. You can gather a group of carefully-selected people, give them a product to try out, and get their feedback within a few hours/days.

Product or service use research helps you obtain useful information about your product or service such as:

• What your current customers do with the product/service
• Which features of the product/service are particularly important to your customers
• What they dislike about the product/service
• What they would change about the product/service

Observation-based research helps you to observe your target audience interacting with your product or service. You will see the interactions and which aspects work well and which could be improved. The main point is to directly experience the feedback from your target audience’s point of view.

Personas are an essential sales tool. By knowing your buyers’ pain points and the challenges they face, you can create better content, target messaging, and campaigns for them. Buyer persona research is based on market research, and it’s built around data that describes your customers’ demographics, behaviors, motivations, and concerns. Sales reporting software can significantly help you develop buyer personas when you gain insights after you collected all information.

Market segmentation research is carried out to better understand existing and potential market segments. The objective is to determine how to target different market segments and how they differ from each other. The three most important steps in writing a market segmentation research report are:

• Defining the problem
• Determining the solution [and]
• Defining the market

Related : 9 Customer Segmentation Tips to Personalize Ecommerce Marketing and Drive More Sales

A price that is too high, or too low, can kill a business. And without good market research, you don’t really know what is a good price for your product. Pricing research helps you define your pricing strategy.

In a competitive analysis, you define your “competition” as any other entity that competes with you in your market, whether you’re selling a widget or a piece of real estate. With competitive analysis research, you can find out things like:

• Who your competitors are
• What they’ve done in the past
• What’s working well for them
• Their weaknesses
• How they’re positioned in the market
• How they market themselves
• What they’re doing that you’re not

Related : How to Do an SEO Competitive Analysis: A Step-by-Step Guide

In today’s marketplace, companies are increasingly focused on customer loyalty. What your customers want is your product, but, more importantly, they want it delivered with a service that exceeds their expectations. Successful companies listen to their customers and respond accordingly. That’s why customer satisfaction and loyalty research is a critical component of that basic equation.

Related : 11 Tactics for Effectively Measuring Your Customer Service ROI

Who you are, what you stand for, what you offer, what you believe in, and what your audience thinks of you is all wrapped up in brand. Brand awareness research tells what your target audience knows about your brand and what’s their experience like.

A campaign research report is a detailed account of how your marketing campaign performed. It includes all the elements that went into creating the campaign: planning, implementation, and measurement.

Here are some of the top advantages and disadvantages of doing market research and crafting market research reports.

• Identify business opportunities – A market research report can be used to analyze potential markets and new products. It can give information about customer needs, preferences, and attitudes. Also, it compare products and services.
• A clear understanding of your customers – A market report gives company’s marketing department an in-depth picture about customers’ needs and wants. This knowledge can be used to improve products, prices, and advertising.
• Mitigates risks – 30% of small businesses fail within the first two years. Why is this so? The answer is that entrepreneurs are risk takers. However, there are risks that could be avoided. A good marketing research will help you identify those risks and allow you to mitigate them.
• Clear data-driven insights – Market research encompasses a wide range of activities, from determining market size and segment to forecasting demand, and from identifying competitors to monitoring pricing. All of these are quantified and measurable which means that gives you a clear path for building unique decisions based on numbers.

Disadvantages

• It’s not cheap – Although market research can be done for as little as $500, large markets like the United States can run into millions of dollars. If a research is done for a specific product, the budget may be even much higher. The budget also depends on the quality of the research. The more expensive it is, the more time the research will take.
• Some insights could be false – For example, if you are conducting a survey, data may be inadequate or inaccurate because respondents can, well, simply be dishonest and lie.

Here are the essential steps you need to take when doing market research:

Define your buyer persona

Identify a persona group to engage, prepare research questions for your market research participants, list your primary competitors, summarize your findings.

The job of a marketing persona is to describe your ideal customer and to tell you what they want, what motivates them, what frustrates them, and what limits them. Finding out these things means you have a better chance of designing your products, services, marketing messages, and brand around real customers. There is no one right way to create a buyer persona, though.

For example, if you’re in an industry focused on education, you could include things like:

• Educational level
• Education background

It’s recommended that you create 3-5 buyer personas for your products, based on your ideal customer.

This should be a representative sample of your target customers so you can better understand their behavior. You want to find people who fit both your target personas and who represent the broader demographic of your market. People who recently made a purchase or purposefully decided not to make one are a good sample to start with.

The questions you use determine the quality of your results. Of course, the quality of your results also depends on the quality of your participants.

Don’t ask questions that imply a yes or no answer. Instead, use open questions. For example, if you are researching customers about yogurt products, you could ask them: „ What have you heard about yogurt ?” or “ What do you think of yogurt ?“.

Avoid questions that use numbers, such as “ How many times a week do you eat yogurt ?”

Avoid questions that suggest a set of mutually exclusive answers, such as “ Do you like yogurt for breakfast, lunch, or dinner ?”

Avoid questions that imply a scale, such as “ Do you like chocolate-flavored yogurt ?”

Market researchers sometimes call one company the top competitor, another middle competitor, and the third one small competitor. However you classify them, you want to identify at least three companies in each category. Now, for each business on your list, list its key characteristics. For example, if your business sells running shoes, a key characteristic might be the product’s quality.

Next, make a list of your small business’s competitive advantages. These include the unique qualities or features of your business that make it the best choice of customers for the products or services it offers. Make a list of these competitive advantages and list them next to the key characteristics you listed for your business.

You have just finished writing your marketing research report. Everything is out there quantified or qualified. You just have to sum it up and focus on the most important details that are going to make a big impact on your decisions. Clear summary leads to a winning strategy!

Related : How to Prepare a Complete Marketing Report: The KPIs, Analysis, & Action Plan You Need

Here’s how to prepare a market research report in 5 simple steps:

Step 1: Cluster the data

Step 2: prepare an outline, step 3: mention the research methods, step 4: include visuals with narrative explanations, step 5: conclude the report with recommendations.

Your first step is to cluster all the available information into a manageable set. Clustering is the process of grouping information together in a way that emphasizes commonalities and minimizes differences. So, in market research, this will help to organize all the information you have about a product, service, or target market and identify your focus areas.

A marketing research report should be written so that other people can understand it:

• Include background information at the beginning to explain who your audience is and what problem you are trying to solve for them.
• In the body of the report, include a description of the methodology – Explain to the reader how your research was done, what was involved, and why you selected the methodology you used.
• Also in the body of the report, include the results of your market research. These may be quantitative or qualitative, but either way they should answer the questions you posed at the beginning.
• Include the executive summary – A summary of the entire report.

The market research methodology section includes details on the type of research, sample size, any limitations of the studies, research design, sample selection, data collection procedures, and statistical analyses used.

Visuals are an essential part of the presentation. Even the best-written text can be difficult to understand. Charts and graphs are easier to understand than text alone, and they help the reader see how the numbers fit the bigger picture.

But visuals are not the whole story. They are only one part of the presentation. Visuals are a cue for the reader. The narrative gives the story, not just the numbers.

Recommendations tend to follow logically from conclusions and are a response to a certain problem. The recommendation should always be relevant to the research rationale, that is, the recommendation should be based on the results of the research reported in the body of the report.

Now, let’s take a look at some dashboard reporting templates you could use to enhance your market research:

• Semrush (Position Tracking) Report

Brand Awareness Report

Sales pipeline performance report, customer success overview report, stripe (mrr & churn) report, semrush (position tracking) report template.

This free SEMRush dashboard template will help you monitor how your website’s search visibility on search engines evolves on a monthly basis. This dashboard contains all of the information you need to make changes and improve the ranking results of your business in Google Search.

This Brand Awareness Report will help you to get a sense of your brand awareness performance in Google Analytics, Google Organic Search, and Facebook. Use this dashboard to track brand awareness the same way you track other marketing campaigns.

Are your sales and marketing funnel healthy and growing? How is your sales and marketing funnel performing? What are the key conversion rates between your lifecycle stages? With a pipeline performance dashboard , you’ll get all of the answers quickly.

This Customer Success Overview Dashboard allows you to analyze how your customer service team’s responsiveness impacts your business. Use this dashboard to assess the correlation between your customer service performance and churn rate. 

This Stripe dashboard tracks your churn rate and MRR growth in real-time and shows you which customers (and how many of them) you have at any given point in time. All you have to do to get started is to connect your Stripe account.

As we said earlier, there are no strict rules when it comes to writing marketing research reports. On the other hand, you must find your focus if you want to write a report that will make a difference. Here are some best practices you should keep in mind when writing a research report.

• Objectives – The objective of a market research report is to define the problems, identify key issues, and suggest recommendations for further research. If you answer them successfully, you’re on the right way.
• Don’t worry about the format – Be creative. The report could be in a form of a PowerPoint presentation, Excel sheet, interactive dashboard or even a video. Use the format that best fits your audience, but make sure to make it easy to read.
• Include an executive summary, scorecard , or a dashboard – This is really important because time is money, and most people don’t have time to waste. So, how to put everything important in a short role? Address all of the objectives and put them in a graphic dashboard or scorecard. Also, you can write an executive summary template (heart of the report) that can be easily updated and read by managers or CEOs.
• Use storytelling –  A good story always makes a great point because it’s so memorable. Your research report results can double the effect with a catchy story.
• Keep it short – It’s not a secret that we are reading so little in the digital era. Use a lot of white space and bullet points. Too much text on a page means less focus for the reader.
• Be organized – Maintain the order of information. It’s important for the reader to navigate through the report easily. If they want to find some details or specific information it would be great to divide all sections with appropriate references.
• Methodological information – Methodological details could be boring. Include only the most important details that the reader needs to know to understand the big picture.
• Use images (or other visualizations) whenever you can – A good picture speaks for 1.000 words! If you can communicate the point visually, don’t hesitate to do it. It would be a lot easier for those who don’t like a lot of text to understand your results. But don’t push them where you can’t.
• Create readable graphs – The crown of marketing research reports is a comprehensive graph. Make sure to design precise and attractive graphs that will power up and round your story.
• Use the Appendix  – You can include all secondary information such as methodological details and other miscellaneous data in the Appendix at the end of the report.

Market research reports are all about presenting your data in an easy-to-understand way and making calculated decisions about business ideas. But this is something easier said than done.

When busy stakeholders and executives grab a report, they need something that will give them an idea of the results – the big picture that addresses company wide-business goals.

Can a PowerPoint presentation or a PDF report meet those expectations? Most likely not. But a dashboard can.

Keep in mind that even with the best market analysis in the world, your market research report won’t be actionable if you don’t present the data efficiently and in a way that everyone understands what the next steps are. Databox is your key ally in the matter.

Databox dashboards are designed to help you present your market research data with clarity – from identifying what is influencing your business, and understanding where your brand is situated in the market, to gauging the temperature of your niche or industry before a new product/service launch.

Present your research results with efficient, interactive dashboards now by signing up for a free trial .

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Notes on Marketing: Complete Notes, Lecture Notes, Short Notes and Study Notes

Complication of Notes on Marketing: Complete Notes, Lecture Notes, Short Notes, Study Notes and Introduction to Marketing Notes!

Complete Study and Lecture notes on marketing especially compiled for BBA, BCom, MCom and MBA students. This article aims to give you an in-depth overview on some of the most important topics relating to marketing and marketing management.

Study Notes as an Introduction on Marketing

• Notes on Personal Selling

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Notes on introduction to marketing # 1. introduction to marketing :.

Till 1950, marketing was usually sales-oriented and the selling concept stressed the need of high pressure salesmanship and advertising to secure maximum sales volume. Since 1950, we have customer-oriented marketing plans and programmes and this customer-orientation is called the marketing concept.

The essence of marketing concept is that customer and not the product shall be the centre or the heart of the entire business system. It emphasizes customer-oriented marketing process. All business operations revolve around customer satisfaction and service. Marketing plans, policies and programmes are formulated to serve efficiently customer demand.

Marketing research and marketing information service is expected to provide adequate, accurate and latest information regarding target markets and current consumer wants as well as dealer wants to the marketing managers and on the basis of such realistic information, they will take sound decision on any marketing problem. The entire marketing mix will be formulated on the basis of marketing research.

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Two radical changes were brought about when the marketing concept was introduced after 1950 in the process of marketing:

1. We have a steady shift from the product-oriented or sales-oriented business enterprise to the customer-oriented business enterprise. Marketing and innovation are now the distinguishing features of a business organization from those of other types of social institution

2. We have also a gradual shift from caveat emptor (buyer beware) to caveat vendor (seller beware). This has clearly emphasized the social responsibility of business towards consumer and the need for consumer protection in the market place.  

According to American Marketing Association, “Marketing is the process of planning and executing the conception, pricing, promotion and distribution of ideas, goods and services to create exchanges that satisfy individual and organizational goals”.

According to the Marketing Guru, ‘Philip Kotler’, “Marketing is typically seen as the task of creating, promoting, and delivering goods and services to consumers and businesses; it is defined as a societal process by which individuals and groups obtain what they need and want through mating, offering, and freely exchanging products and services of value with others.”

Sometimes, marketers confuse marketing with selling, since they consider marketing as an art of selling products. However, marketing is different from selling in many ways.

Short Notes on Marketing # 2. Market Segmentation :

The total market for many of the products is not homogeneous but too much heterogeneous because people have different needs and wants and therefore, marketer cannot derive maximum benefit from an analysis of marketing as a whole. For example, there may be total market for textiles, electrical appliances, refrigerators, etc., but within the total for each of these products, there might actually exist many sub-markets which differ virtually from each other.

Under textile markets, in one section of the population, there might be huge demand for cotton textile, in another for synthetic fibre textiles and yet in another for pure silk garments. This diversity may be due to differences in income of the people, taste, fashion buying habits or motives, etc. Further no two customers are identical in their demand.

Therefore, to take advantage of this situation, the marketers may divide the total market into smaller groups of consumers on the basis of significant difference in buyer characteristics or buyer responses to marketing programs.

By tailoring product designs, pricing policies, promotion and distribution channels to meet the needs of these small groups’ marketers often gain a competitive advantage. This kind of marketing strategy is also consistent with the marketing concept, which requires the identification of the consumer wants and needs and development of marketing programs to satisfy them.

According to Stanton, “Market segmentation consists of taking the total heterogeneous market for a product and dividing it into several sub-markets or segments each of which tends to be homogeneous in all significant aspects.”

Market segmentation is the process of dividing a potential market into distinct sub-markets of consumers with common needs and characteristics. Market segmentation is the starting step in applying the marketing strategy. Once segmentation takes place, the marketer targets the identified customer groups with proper marketing-mix so as to position the product/band/company as perceived by the target segments.

From the perspective of the marketing manager, market segmentation involves two closely related areas. First, the total market for any product can be sub-divided or segmented into groups of potential customers who are homogeneous with respect to certain wants or desires. Second, it might be advantageous to the organisation to serve one or more of these market segments.

Market segments are large identifiable groups like customers interested in personal computer, laptop, tablet, etc. It is possible that a market creates a niche. Niche is a narrowly defined group of customers that have a distinct and complex set of needs.

Thus, in Cycle Industry, there might be segments like cycle for regular users, sports, adventure, racing, kids, girls, etc. Niche is created when cycle is required for health clubs, physically handicapped with left and right hand working, etc. In the niches, there are few or no competitors and the product might command a premium price.

Complete Notes on Marketing # 3. Multi-Level Marketing:

Multi-level marketing (MLM) is a mode of direct marketing followed by a producer or marketer. Multi-level marketing, pioneered by Amway, consists of recruiting independent business persons who act as distributors of company’s product. Each distributor can further engage other sub distributors and so on. The distributor’s compensation includes a percentage of sales of those engaged by the distributor as well as earnings (margins) on direct sales to the customers.

Under multi-level or network marketing, the product reaches the customers from the manufacturer via distributors, sub-distributors, sub-sub distributors and sub-sub-sub distributors. The distributors are organised in the form of hierarchy, i.e., level I, level II, level III and so on. Each of the distributors is also a customer. The products are always sold directly to the customers. The conventional retail route is completely by-passed.

In multi-level marketing (MLM), individuals become associated with the parent company in an independent contractual relationship. They are compensated based on their sales of company’s products or services, as well as the sales of those they bring into the business. Multi-level marketing has a recognised image problem because of difficulties in making a clear distinction between legitimate network marketing and illegal “pyramid schemes” or Ponzi schemes.

Due to this image problem, many new MLM network marketing firms do not use the words “multi-level marketing” or “network marketing” and instead use terms like “affiliate marketing”, “home-based business franchising” etc. Under this arrangement, commissions are only earned on the sale of products or services to the end consumer who, in many cases, is also a distributor. No money is earned on a “sign-up fee” or for recruiting distributors alone.

The companies which are using MLM include Amway Corporation (household goods, personal care and nutritional products); Avon Products (cosmetics, jewellery, home furnishing, and baby care products); Brite Music Enterprises (children’s song books, CDs, DVDs, etc.), and Discovery Toys (educational toys, books, and games).

Limitations of Network Marketing :

The limitations of multi-level or network marketing are as follows:

(i) Sales forecasting is difficult. This might result in under or over stocking of various items.

(ii) Customer relationships are at the mercy of the distributors or sub­distributors.

(iii) Brand-building is very difficult without sales promotion and advertising.

(iv) Distributors may become large customers and hence take over control of the company.

(v) The company cannot control its sales team’s actions because of its excessive dependence on the network of distributors and sub­distributors.

Lecture Notes on Marketing # 4. Organization Structure:

Inside any company, a large number of activities are carried out by big groups of individuals, spread across multiple departments (e.g. Production, Sales, Marketing, Purchase, Human Resources, Administration, Inventory (Stock), IT Systems, Accounts etc.).

The activities within these departments must be properly coordinated such that every employee understands his responsibilities. Also, the employees need to understand the protocol for their communication and coordination within the department and also across various departments.

Ideally, each department must be supervised by one single person, and the team within that department must report to her. That person remains responsible for the day-to-day decisions and performance of that department. This ensures a single line of command. Without a single command line, employee coordination is very difficult.

If everybody takes decisions about everything, a lot of confusion and communication gaps may arise. In such cases, nobody will be responsible when things go wrong. This is usually observed in organizations which have grown without putting proper systems and processes in place.

Of course, if the organization is very small where only one business leader takes care of all the activities, only he is the single command, but division of activities within the team is essential and applicable in such cases also.

The tool to graphically represent the relationships and responsibilities within a company is called an Organization Structure.

It is a tree-like graphical representation of the organization, starting from the head of the organization at the top and the hierarchy below him shown downwards.

As the name suggests, it is used to properly communicate the work and reporting relationships within the company in an organized and structured manner.

Everybody on the roll of the company must be represented in the organization structure.

In an organization structure, the person shown above is responsible for guiding and supervising the person(s) below her.

The persons below are responsible to fulfill the work given to them and report the status to the person above.

The reporting relationships must be determined very carefully. People’s seniority, experience etc. must be considered while deciding these relationships. If proper care is not taken in deciding the reporting structure, it may give rise to a lot of conflicts within the team.

Ideally, every employee in the company must have one position in the organization structure. This means that there should be only one boss for every employee. Nobody in the company should have more than one reporting boss. If it is so, it creates a lot of confusion.

If functionally a person performs multiple duties which fall under two or more departments, she may have functional reporting to more than one bosses, but her administrative boss must be only one. This administrative boss should be the one who may grant her various permissions like leaves, reimbursement of expenses etc.

The senior positions must be given to the persons with leadership and people skills along with the requisite technical skills and relevant experience. If the persons at higher positions lack leadership and people skills, they will eventually be ineffective in those supervisory roles. If these skills are not possessed, we must try to develop the same in them through proper training and coaching.

The organization structure must be revised as and when the manpower changes occur within the company.

Notes on Marketing # 5. Channels of Distribution :

A channel of distribution refers to a path or route that a good or service takes in order to reach the hands of the ultimate consumer. In other words, it is a chain of businesses or intermediaries through which a good or service passes until it reaches the end consumer. Distribution channels in marketing are a key element in the entire marketing strategy. It helps the business in expanding its reach and grows its revenue.

Some important definitions of channels of distribution:

A channel of distribution or marketing channels are the distribution networks through which producers’ products flow to the market. — Cundiff, Still and Govoni

This is a route taken by the title to the goods as they move from producer to the ultimate consumers or industrial users. —William J. Stanton

There are various functions of distribution channels:

(i) Transfer of title of the goods involved.

(ii) Physical movement from the point of production to the point of consumption.

(iii) Storage function.

(iv) Communication of information concerning the availability, characteri­stics and price of the goods in transit, inventory and on purchase.

(v) Most of the utilities of products are created by performing the function of physical distribution promptly and efficiently.

(vi) Transactional function like buying from the manufacturer and selling to the consumer.

(vii)Storing the goods and sorting them into quantities desired by customers.

(viii) Channels of distribution also conduct marketing research and gather data on market conditions, expected sales, consumer’s trends, competition etc. Thus giving valuable information to the manufacturer.

(ix) Distribution channels help in maintaining the price too. By stocking the goods, a constant flow of goods to the market is assured. This equalizes the demand and supply factors which stabilize prices.

Channels of distribution are very important for any firm because of the following:

(i) Distribution channel is an important element of marketing mix of a firm and other elements are closely related with interdependence on the distribution channel. Other marketing decisions like pricing, promotion and physical distribution are highly affected by this.

(ii) A sound distribution channel enables the firm to cut down cost and maximize its sales volume.

(iii) The cost involved in the use of distribution channels adds up into the price of the product that the ultimate customer has to pay. Thus it is important to choose the distribution channel wisely.

(iv) A product or service is really useful to the consumer only when it is available at the right time and at the right price. Distribution channels ensure this.

(v) Due to right distribution channels fluctuations in the production can be reduced which ensures steady employment and proper budgetary control.

Notes on Marketing # 6. Direct Marketing :

Direct marketing refers to an element of marketing communication that facilitates organizations to reach their customers directly without any intermediary. This element of marketing communication involves sending direct mails through the Internet and providing catalogs and coupons to customers.

It also includes telemarketing that requires calling customers through telephones. This type of marketing does not necessarily involve face-to-face interaction with customers. Direct marketing proves to be an extremely effective element of marketing communication process that practices a targeted marketing approach to lure customers. It helps in creating valuable and lasting relationships with customers in the long run.

Oriflame Cosmetics is one of the best examples of an organization practicing direct marketing. The organization sells cosmetic products all over the world (62 countries). The customers of Oriflame themselves act as consultants by taking its membership to sell products to other customers with the help of a catalog.

Direct marketing is generally an unsolicited practice and can be seen as a nuisance by people as they do not like to be disturbed by sales representatives. The practices of direct marketing, such as telemarketing, e-mailing, and junk mailing are generally not entertained by customers. These practices distract the routine of customers. Thus, the tools of direct marketing need to be used with caution.

Significance of Direct Marketing :

Direct marketing facilitates an organization to target a specific segment of customers. It assists the customers in making purchase decisions by showing them product demonstrations. An organization can design a number of suitable ways to serve its customers as per their unique needs and make more efficient and effective marketing efforts. Direct marketing is a relatively cheaper way to reach out to a huge number of customers at a personal level. Thus, it helps an organization to build a relationship with customers.

Advantages and Disadvantages of Direct Marketing :

Following are the advantages of direct marketing:

a. Involves high conversion and success rate as customers can be approached directly

b. Serves as a basis for testing the chances of success of new products in the market

c. Facilitates rapid delivery of products.

Following are the disadvantages of direct marketing:

a. Evokes the resistance of customers when extra persuasion is used to sell the products

b. Having less sales orientation and more customer-relationship orientation

c. Pestering customers by sending bulk mails and making telemarketing calls.

Notes on Marketing # 7. Marketing Orientations :

An orientation, in the marketing context, relates to a perception or attitude a firm holds towards its product or service, essentially concerning consumers and end-users. The marketing orientation evolved from earlier orientations namely the production orientation, the product orientation and the selling orientation.

Product Orientation :

The industrial revolution of the 17 th century brought about the production era, which continued till the late 1920’s. Up to 1950s firm focused on a production orientation specializes in producing as much as possible of a given product or service. Thus, this signifies a firm exploiting economies of scale, until the minimum efficient scale is reached.

A production orientation may be deployed when a high demand for a product or service exists, coupled with a good certainty that consumer tastes do not rapidly alter. Companies focused on manufacturing processes and they looked for ways and means to produce the goods faster, more efficiently and at low prices. Product features were not given any importance because it was felt that customers were concerned only about the availability of the product, and not about its features.

Sales Orientation :

The sales era began in early 1960s. A firm employing a product orientation is primarily concerned with the quality of its own product. A firm would also assume that as long as its product was of a high standard, people would buy and consume the product. Manufacturers believed that the success of their business depended on outselling the competition. Companies realized the need for product promotion and distribution. In this era, marketers focused their efforts only on selling their products to the customers.

Companies realized that they could increase their demand by promotional methods like advertising, product promotion etc.

Marketing Orientation:

1970’s to present day, the marketing orientation is perhaps the most common orientation used in today’s marketing. It involves supplying products and services according to consumer tastes. Marketers wants to know their customers in better way, by the R&D they develop a product attuned to the revealed information, and then utilize promotion techniques to ensure persons know the product exists. During the sales era, companies ignored consumer wants and needs. They focused simply on selling their products. Critics of sales era believed that products in sales era were sold without looking at consumer needs and wants.

At this stage, companies focused on marketing, rather than on selling; they also embraced the concept of coordinated marketing management, which was directed toward the twin goals of customer orientation and profitability. Companies are now shifting their focus towards customer relationship, and began attempting to fulfill customers’ needs according to their preferences.

Notes on Marketing # 8. Marketing Environment:

A company’s ability to develop and maintain successful transactions with its target customers is affected by company’s marketing environment. Marketing environment consists of the forces close to the company that affect its ability to serve and satisfy its customers in the context of their needs and requirements.

All firms must identify, analyse and monitor external forces and assess their potential impact on their goods and services. Although external forces are outside the marketing manager’s control, they must be considered together with the variables of the marketing mix (i.e., product, price and promotion) in developing marketing plans and strategies. An attempt has been made to study the impact of various kinds of external environmental variables on the decisions to be taken by marketing managers.

The term ‘marketing environment’ denotes all the external factors and forces that affect a firm’s ability to develop and maintain successful transactions and relationships with the target customers. Thus, marketing environment includes all forces that affect marketing policies, decisions and operations of a firm.

The external forces which constitute uncontrollable environment include (a) micro factors such as suppliers, customers, intermediaries, competitors and general public; and (b) macro factors such as demographic, economic, natural/physical, technological politico-legal and socio-cultural factors.

The internal environment of a firm which is controllable includes product design, packaging, pricing, promotion, and distribution policies of the firm. As a matter of fact, these forces constitute the marketing mix of a firm.

What Is Marketing Environment?

“A company’s marketing environment consists of the actors and forces outside marketing that affect management’s ability to build and maintain successful relationships with target customers.” —Philip Kolter

A few examples of external forces having influence on a business are as follows:

(i) Rapid technological changes as in computer industry—introduction of new models.

(ii) Changes in government economic policies, e.g., licensing policy, import-export policy, taxation policy, etc.

(iii) Political uncertainty, e.g., unstable government, change of finance minister or industry minister of the nation, etc.

(iv) Social changes, e.g., demand for reservation in jobs for minorities and women.

(v) Changes in fashion and tastes of consumers, e.g., preference for Khadi garments in place of synthetic garments, dislike of oils containing unsaturated fats.

(vi) Labour unrest leading to industrial conflicts—demand for higher wages and bonus, better working conditions, etc.

(vii) Increased competition in the market with the entry of multinational corporations (MNCs).

Notes on Marketing # 9. Societal Marketing :

The philosophy of marketing has been continuously changing with the emerging new social values and trends. Marketing is a societal activity to meet consumption needs for human welfare and existence. The societal marketing concept is a management orientation that holds that the key task of the organisation is to determine the needs, wants, and interests of target markets and to adopt the organisation for delivering the desired satisfactions more effectively and efficiently than its competitors in a way that preserves or enhances the consumer’s and society’s wellbeing.

Societal marketing management considers four basic elements while taking decisions viz., consumer needs, consumer interests, company interests and society interests. The wave of consumerism; pioneered by Ralph Nader in the late 1960s, which aims at protecting the consumers’ interests because they are the king; has a strong impact over societal marketing concept.

In the social responsibility era, the businessman should bear the social cost of its antisocial conduct as quid pro quo. The business is compelled to be socially responsible for its own survival and growth. A query arises why should business markets bother at all about society? This enigma can be judged by two arguments, viz. argument of survival and argument of social cost.

The true marketing believes, consumer is pivotal and does not ask, ‘what do we want to sell?’ but asks ‘what does the consumer what to buy?’ The modern concept supports to provide high customer welfare and satisfaction. This includes satisfying the personal consumer needs and considering social good and environment.

The product is not only an item of purchase and sell but also affects the whole society. If we consider the same example of Pillsbury Company U.S.A., it has changed its goal. Now Pillsbury is emphasising the national value of its product. Social marketing is new sense of social responsibility for everyday business activity.

Notes on Marketing # 10. Marketing Mix:

Marketing mix is the combination to various elements which are available at the disposal of a marketer, it consist of essential variable factors which influence success of marketing. Marketing variables are changing with the expectation, need and desire of customers, increasing competition in market and consumer awareness also impact on marketing mix strategies.

Marketing mix is the set of marketing tools that the firm uses to pursue its marketing objectives in the target market. Marketing mix decisions must be made to influence the trade channels as well as the final consumers. Marketing mix elements remain in control of a business firm, marketers can make changes according to change in business environment and marketing policy of a firm.

According to American marketing association “A marketing mix is nothing but a judicious blending of the various ingredients available at the disposal of a marketer”.

In the early 1960s, Professor Neil Borden at Harvard Business School identified a number of company performance actions that can influence the consumer decision to purchase goods or services. Borden suggested that all those actions of the company represented a “Marketing Mix”. Professor E. Jerome McCarthy, at the Michigan State University in the early 1960s, suggested that the Marketing mix contained 4 elements—product, price, place and promotion.

The product aspects of marketing deal with the specifications of the actual goods or services and how it relates to the end-user’s needs and wants. The scope of a product generally includes supporting elements such as warranties, guarantees, and support.

This refers to the process of setting a price for a product, including discounts. The price need not be monetary; it can simply be what is exchanged for the product or services, e.g. time, energy or attention. Methods of setting prices optimally are in the domain of pricing science.

Place (or Distribution):

This refers to how the product gets to the customer; for example, point-of-sale placement or retailing. This third P has also sometimes been called Place, referring to the channel by which a product or service is sold (e.g. online vs. retail), which geographic region or industry, to which segment (young adults, families, business people), etc. also referring to how the environment in which the product is sold in can affect sales.

This includes advertising, sales promotion, promotional education, publicity, and personal selling. Branding refers to the various methods of promoting the product, brand, or company.

These four elements are often referred to as the marketing mix, which a marketer can use to craft a marketing plan – The four Ps model is most useful when marketing low value consumer products. Industrial products, services, high value consumer products require adjustments to this model.

(i) List price

(ii) Discounts

(iii) Allowances

(iv) Payment period

(v) Credit terms

(i) Sales promotion

(ii) Advertising

(iii) Sales force

(iv) Public relations

(v) Direct marketing

(i) Channels

(ii) Coverage

(iii) Assortments

(iv) Locations

(v) Inventory

(vi) Transport

(i) Product variety

(ii) Quality

(iii) Design

(iv) Features

(v) Brand name

(vi) Packaging

(vii) Sizes

(viii) Services

(ix) Warranties

(x) Returns

In order to recognize the different aspects of selling services, as opposed to Products, a further three Ps were added to make a range of Seven Ps for service industries:

i. Process—the way, in which orders are handled, customers are satisfied and the service is delivered.

ii. Physical Evidence—is tangible evidence of the service customers will receive (for example, a holiday brochure).

iii. People—the people meeting and dealing with the customers.

Notes on Marketing # 11. Product :

The product is the most tangible and important single component of the marketing programme. Product is the vehicle by which a company provides consumer satisfaction. It is the engine that pulls the rest of the marketing programme. The product may be goods, a service, a goods plus service, or just an idea. A product is all things offered to a market.

Those things include physical objects, design, brand, package, label, price, services, supportive literature, amenities, and satisfaction, not only from physical product and services offered but also from ideas, personalities and organisations. In short, a product is the sum total of physical, economic, social and psychological benefits.

Marketers must define their market in terms of product functions — what the customer expects from the product. Buyers are not interested in the composition of a product. They are concerned only with what the product does, what the product means to them and to what extent it satisfies their social and psychological needs. The needs will vary between one customer category and another. The needs and expectations are also changing.

A product is any tangible offering that might satisfy the need or aspiration of a consumer. A product is a set of attributes assembled in an identifiable form. There are three attributes for a product- (a) Any product should have a physical form, (b) it should offer some utility to serve the purpose, and (c) it should give satisfaction to the customer. Example- Ball-point pen, shape of the pen serves as a physical form, ink inside the pen serves as a utility, and smooth writing leads to consumer satisfaction.

A manufacturer of cosmetics said- “In the factory we make mascara and skin cleaner, but in the store we sell hope and beauty.” Toothpaste may be a product to the producer. To the consumer it means whiter and cleaner teeth, pleasant taste, fewer cavities, stronger gums and sweet-smelling breath.

The consumer buys these hopes and expectations, and not the toothpaste. These expectations of benefits are called market offerings and they act as the selling points of a product. If the performance of the product is on par with expectations, the customer will be satisfied and the seller’s mission is fulfilled.

What marketers are selling in a product is the capacity and competence of the product to offer expected use, performance and satisfaction. The concept of product as a bundle of utilities, satisfaction, and benefits cannot be overstressed.

Notes on Marketing # 12. Retail Audit:

Audit means verification or checking. Retail audit means verification or checking performance of a retail organisation.

Retail Audit can be defined as systematic examination and evaluation of firms retailing efforts it is investigation of retailer’s objectives, strategy implementation and organisation.

Such audit may be undertaken by a company audit specialist or be a company department manager or outside auditor.

Retail audit reviews basically a firm’s strategy and its operations to identify its areas of strength and neatness.

There are basically two types of audit:

(a) Horizontal.

(b) Vertical.

A Horizontal retail audit undertakes evaluation of overall performance that is organisations, goals, customer satisfaction, retail marketing mix and its implementation.

A Vertical audit analyses firms performance in one specific area e.g. Customer service, Merchandise assortment interior display etc.

Whereas Vertical audit concentrates in one area Horizontal audit undertakes evaluation of functioning performance of entire retail operation. The purpose of such audit is to find out limitations in functioning of retail operations and suggests necessary remedies for its improved performance.

Retail audit provides gather information on a brands sales volume, sales trends, stock level effectiveness of in-store display and promotion efforts and other associated aspects.

Retail audit also called store audit. The measurement of products sales in a store for a time. It verifies movement of a product. What factors influence movement of a product, like price, advertisement, the salesman, visual display etc. Retail Audit helps to evaluate existing marketing programme. If the present marketing tactics are not yielding results, it guides new strategies.

Notes on Marketing # 13. Marketing Ethics:

Marketing ethics goes beyond legal issues though the distinction between ethical and legal issues often gets ignored in decision making. Ethics are standards of moral conduct. To act in an ethical fashion is to conform to an accepted standard of moral behaviour.

It is easy to be ethical when no hardship is involved—when a person is winning and life is going well. The test comes when things are not going well —when pressures build. These pressures arise in all walks of life, and marketing is no exception.

Marketing executives face the challenge of balancing their own best interests in the form of recognition, pay and promotion, with the best interests of consumers, their organisations, and society into a workable guide for their daily activities. In any situation they must be able to distinguish what is ethical from what is unethical and act accordingly, regardless of the possible consequences.

An ethical issue in marketing arises whenever consumers feel manipulated or cheated.

Main ethical issues in marketing are given below:

(i) Product issues – Failure to disclose risks associated with the product, use of inferior materials or components to reduce costs.

(ii) Price issues – Price fixing, predatory pricing failure to disclose the full price associated with a product.

(iii) Promotion issues – False and misleading advertising, deceptive or manipulative sales promotion, use of bribery in personal selling.

(iv) Distribution issues – Manipulating suppliers to distributors, coercing middle men.

Methods to Create Ethical Relationships in Marketing:

(i) Listen and learn – Recognize the problems that confront your company, team or unit. Do not argue, criticize or defend yourselves, keep listening and reviewing until you are sure that you understand others.

(ii) Identify the ethical issues – Examine how the co-workers and consumers are affected by the situation or decision at hand. Examine how you feel about the situation and understand the view point of those who are involved in the decision or the consequences of the decision.

(iii) Create and analyze options – Try to put aside strong feelings.

Marketing is Highly Influential in Nature:

If used unwisely, it can have harmful implications like:

(i) Marketers can take undue advantage of vulnerable groups such as children. They can take advantage of impulsive or less sophisticated buyers specially the elderly by hiding the information or by making false promises.

(ii) They can sell outdated or useless products to inner-city rural people due to lack of knowledge.

(iii) They can promote potentially harmful products, e.g., Baby food products are generally accused of adding sugar in the powder since they know that generally mothers are used to tasting the food although it is not necessary for the baby.

(iv) Invasion of privacy-Almost every time a consumer orders a product by mail or telephone, his name, address and telephone number is added to the company’s database. This information is generally used for further sale and can also be sold to other companies.

(v) Irritation-Direct marketing or tele-marketing generally irritates people who are not interested in the product.

Thus a marketer must take care of all of the above problems arising out of his deeds and should act ethically.

Notes on Marketing # 14. International Marketing Channels:

International marketing channels, also called world market penetration policies, could be defined as those different company structures that perform or facilitate, totally or partially, the undertakings implied by the internationalization of a company.

A company internationalization implies a gradual and constant assumption of commitments of different kinds (financial, human, productive, among others), which allows a progressive connection with external markets, and which promotes the generation of commercial agreements in the medium and long term. The concept of internationalization can be thought of from the exporting as well as from the importing operation point of view.

Selection of International Marketing Channels:

A small and medium-sized organization entrepreneur who wants to have access to international markets with his or her product has to know that there is not only one standardized way to gain access. There are different factors that should be assessed in order to enter a product in the global markets, which will directly affect the selection of the access channel.

Among the most important there are:

i. Kind of product commercialized in the internal market (differentiated or undifferentiated product, industrial or for ultimate consumers, etc.).

ii. Market knowledge degree the company that wants to have access to the world market possesses (in some cases, it is even unknown which the most convenient market for a product is).

iii. Level of knowledge of the different aspects of international marketing- export operations, management of international commercial documents and means of payment, insurance and carriage hiring, and detection of business opportunities.

iv. Competitive environment features of the destination market. That is, how concentrated competition is, what the number of competitors is, and what their distribution participation in the market is.

v. The existence of strong tariff (taxation on imports) or paratariff barriers (quota for imports; bureaucratic, customs, packing, commercial documentation and quality regulations), that hinder access to the market through exportation.

vi. Market size and its features- Market size, as well as its cultural, political and economic features that make it different from the market of origin, will have to be analyzed.

vii. The degree of risk (closely related to the levels of income yield capacity that each operation may render) the company is willing to accept in internationalization. There are channels like direct investment or product manufacturing in the destination market, which carry a higher risk for the operator that enters international markets. However, other channels such as trading companies that buy the product directly to the manufacturer in order to export it later at their own risk, represent less risk for entrepreneurs.

viii. Number of resources (financial, human, productive, etc.) that the company devotes to international activity.

ix. Degree of control that the organization wants to keep over the international marketing process.

x. Internationalization stage of the company.

Notes on Marketing # 15. Virtual Marketing :

The World-Net and Electronic Marketing:

The development of new digital or virtual channels gives rise to new business models called “virtual businesses”. One of main qualities of the Internet is the hypertext. It allows to move from one datum to another in non-synchronic jumps, simultaneously and multimedially, generating a great variety of text, image, and sound links in a server-client relationship.

Virtual marketing is based on the structure developed by Internet an information highway. Internet is part of the www (World Wide Web), which expands as a world-net, linking every sector of the planet through information highways.

Electronic trade, in the strict sense, can be assimilated to the business and information exchange developed through the net, but, in a wider sense, it includes other ways of electronic marketing (automatic teller machines, electronic machines, etc.) so, it originated before Internet trade.

The European Union includes those transactions and businesses in which information or communication technologies are used in electronic trade. The following words, related to the Internet commercial channels, are going to be considered as synonyms in order to simplify criteria for the development of this topic- electronic trade, e-commerce, virtual marketing, and digital marketing.

Main Features of Electronic Marketing:

Electronic trade is based on the development of websites and webpages that can be visited by any potential consumer of the global market, and on the management of electronic trade or e-mail (in the last case, a more limited electronic trade).

Electronic trade implies, among other issues:

i. The existence of adequate hardware (PC, modems, etc.), that is, the physical infrastructure to develop the virtual platform.

ii. Advanced Controllable Variables of the Commercial Mix 277

iii. Software adequate to develop the different virtual processes efficiently (treatment of graphs, data filing, etc.).

iv. Virtual space where the page will be located. This means hiring the services of an Internet provider (ISP or Internet Service Provider). Those services may be varied and include- page design, surfing service, technical support and maintenance, site content updating. This may vary according to the space granted to the page, number of mail boxes in use, maximum amount of monthly data to update the site, hours of surfing, speed connection, among other variables.

v. Virtual commercial approach complementation with real complementing service such as distribution and personal handing of the acquired products.

Notes on Marketing # 16. Marketing Information System:

Marketing information system usually abbreviated as MkIS, is the major tool used by marketing management for problems solving and decision-making. The concept of marketing information system can be understood easily by earlier examination of three separate words: marketing, information and system. Marketing information includes all the facts, estimates and opinions etc.

That affect the quality of decisions for firm’s survival and growth. Marketing information system is an interacting, continuing, future-oriented structure of people, equipment and procedures designed to generate and process an information flow to aid managerial decision-making in a company’s marketing programme.

According to Philip Kotler, “A marketing information system is a continuing and interacting structure of people, equipment and procedures designed to gather, sort, analyse, evaluate and distribute pertinent, timely and accurate information for use by marketing decision makers to improve their marketing planning, execution and control”.

Marketing information system is a systematised method for providing information flow on a regular basis – the right information, for the people, at the right time. MkIS is a very broad term. Even it includes such diverse elements such as weather reports and forecasts which may affect the agricultural commodity prices.

After the problem definition, the marketing information are collected through internal or external sources. The collected data are carefully interpreted and used. Finding the conclusive truth from data analysis highly depends on the dynamic thinking capacity and creative, logical mind of the marketer.

After data interpretation, the marketing information must be communicated and disseminated to the ready parties. Effective management not only makes systematic analysis but also dissemination of that at different organisational levels should also be cared. The decision making authority must communicate his opinion to the man of action’, so that ‘doing and thinking man’ can be combined.

A MkIS, to some extent, resembles a military or diplomatic intelligence operation. It gathers, processes and stores potentially useful information that currently, exists in inside or outside the company. However, in MkIS we could not suggest the industrial espionage or hiring the competitors’ personnel to say their secrets.

Frequently they are valueless or counter-productive. Moreover, the information a company needs is usually available by socially acceptable means, if the firm will just establish a reasonably simple marketing information system.

Notes on Marketing # 17. Market Research:

The term market research encompasses a number of activities that are designed to connect marketers to consumers through information gathering and evaluation. Market research provides businesses with information about their customers, their competitors, and their overall industry.

It is commonly used to identify marketing problems and opportunities, as well as to develop and evaluate the effectiveness of marketing strategies. Small business owners, because of their usually limited financial resources, have a particular need for adequate, accurate, and current information to aid them in making decisions.

Market research can help entrepreneurs evaluate the feasibility of a start-up venture before investing a great deal of time and capital, For example- as well as assist them in effectively marketing their goods and services.

Employing such marketing strategies as market segmentation and product differentiation would be nearly impossible without first conducting market research. Market research is often needed to ensure that we produce what customers really want and not what we think they want.

Market research refers to organized use of sample surveys, polls, focus groups, and other techniques to study market characteristics (e.g., ages and incomes of consumers; consumer attitudes) and improve the efficiency of sales and distribution.

Development of new products, opening of new markets, measurement of advertising effectiveness, and knowledge of business competitors are among its basic aims. Developed in the United States in the early 20th cent., the field expanded rapidly after World War II, spreading to Europe and Japan.

Market Research is the collection and analysis of information about consumers, competitors and the effectiveness of marketing programs. Small business owners use market research to determine the feasibility of a new business, test interest in new products or services, improve aspects of their businesses, such as customer service or distribution channels, and develop competitive strategies.

In other words, market research allows businesses to make decisions that make them more responsive to customers’ needs and increase profits. While market research is crucial for business startup, it’s also essential for established businesses. It’s accurate information about customers and competitors that allows the development of a successful marketing plan.

While it’s common for businesses to hire market research companies to conduct market research for them, it is possible for small business owners to do their own. For an explanation of the basics of market research and tips on designing your own market research surveys and questionnaires. Scientific discovery methods applied to marketing decision making is known as market research.

Market Research is a systematic, objective collection and analysis of data about a particular target market, competition, and/or environment. It always incorporates some form of data collection whether it be secondary research (often referred to as desk research) or primary research which is collected direct from a respondent.

The purpose of any market research project is to achieve an increased understanding of the subject matter. With markets throughout the world becoming increasingly more competitive, market research is now on the agenda of many organisations, whether they be large or small.

Market Research is broader in scope and examines all aspects of a business environment. It asks questions about competitors, market structure, government regulations, economic trends, technological advances, and numerous other factors that make up the business environment.

Sometimes the term refers more particularly to the financial analysis of companies, industries, or sectors. In this case, financial analysts usually carry out the research and provide the results to investment advisors and potential investors.

Study of the requirements of specific markets, the acceptability of products, and methods of developing and exploiting new markets. Various strategies are used for market research- past sales may be projected forward; surveys may be made of consumer attitudes and product preferences; and new or altered products may be introduced experimentally into designated test-market areas.

Formal market research dates back to the 1920s in Germany and the 1930s in Sweden and France. After World War II, U.S. firms led in the use and refinement of market-research techniques, which spread throughout much of Western Europe and Japan.

Gathering, analyzing, and interpreting data concerning market conditions are known as Market Research.

Example- Market research typically includes a detailed data collection phase, whereas market analysis focuses principally on interpreting data that have already been collected.

Although market research can be costly, it is often even more costly to make erroneous decisions based upon bad or inadequate information. In fact, an average business spends between 25 and 50 percent of its annual marketing budget on research activities. Conducting large-scale market research in-house is not possible for many small businesses, since it requires a comprehensive understanding of the problem to be addressed, the market, and the application of research procedures.

But there is a great deal of helpful information available to entrepreneurs who know where to look, and there are many consultants, advertising firms, and market research specialists who offer their services to small businesses for a fee.

The information gathered through market research can be divided into two main categories- The first category- primary information- generally does not exist in a coherent form before the marketer gathers it in response to a particular question or problem. The most common methods of gathering primary market research information are through direct mail, telemarketing, and personal interviews.

The other category-secondary information-has already been compiled and organized by a source other than the marketer. Rather than looking at a specific marketing problem faced by an individual company, secondary information generally tracks trends within a market, an industry, a demographic group, or a geographic region.

A great deal of valuable secondary information is available to small business owners at little or no cost. Some possible sources of secondary market research information include government reports, trade association records, newspaper and magazine surveys, university-sponsored research, local chamber of commerce records, on-line services, and competitors’ annual reports.

Market research can provide small business owners with the information they need to answer a wide range of questions, including: Who are my customers? Where are they located? How much and how often will they buy? And what product attributes.do they prefer? Given the importance of market research – and its potential cost- experts recommend that businesses follow a step-by-step approach in order to gain the most benefits from their research activities.

The first step in the market research process is to define the marketing problem to be addressed. Next, a marketer should determine what information is needed to solve the problem, as well as what sources should be used to acquire the information.

Many businesses make a preliminary investigation at this early stage in order to give their definition of the problem more focus and to develop tentative answers that can be tested during the next stage of the process. The third step involves planning the research.

This step includes selecting the techniques to be used for gathering data and deciding on an appropriate group, or sample, to be included in the research. Fourth, a marketer actually gathers the necessary data.

The fifth step involves analyzing and interpreting the information that has been gathered. Finally, the marketer reaches a conclusion about the marketing problem and translates the findings into changes in the firm’s overall marketing strategy.

There are three general types of market research suppliers that can assist small businesses with one or more steps in the above process. Some firms specialize in conducting overall market research that they release to a variety of clients for a fee.

This type of firm includes syndicated services such as A.C. Nielsen and Company, which provides viewership ratings for national television programs. There are also custom market research firms that handle all aspects of the process, from defining the marketing problem and designing research techniques to evaluating results and formulating new marketing strategies.

In contrast, smaller, specialty line suppliers usually concentrate on one aspect of the process. Marketers who wish to secure the services of a market research firm usually obtain bids from a number of suppliers. The following sections provide more information about the various types of market research that such suppliers perform.

The purpose of market research is to gather facts about markets and the forces operating therein.

The areas of market research broadly include:

i. Study of the market size/potential

ii. Study of the market profile

iii. Market share analysis

iv. Study of market segments

v. Market trends

vi. Sales forecasting

vii. Study of seasonal trends.

Notes on Marketing # 18. Advertising Research :

Advertising research is a prerequisite for developing advertisement as well as assessment of effectiveness of the advertisement. It is necessary to understand thoroughly the product profile in terms of its physical properties and composition to enable to develop a meaningful and factual copy.

The organizational profile needs to be understood clearly for linking the product with the organization and its brand. It is a must to conduct buyer behavior survey to know the perceptions of the viewers and the potential response. The advertisement pre-testing results also need to be analyzed and used for modifying the copy and presentation style.

The media effectiveness may be studied for any advertisement by conducting the viewership survey, media vehicle response, and advertisement scheduling results, frequency and reach assessment and the impact of the previous advertisement. The effectiveness of any advertisement can be measured at two different levels – pre-insertion and post-insertion of the advertisement in the media.

The concept of the advertisement can be measured in a pre-testing campaign, by viewing or presenting to sample viewers and getting free association of the consumers and merchants while developing the same. The specific and non-specific themes may be tested with specially identified viewers. The reach and status of the media is to be assessed before insertion of the advertisement.

The copy research can be assessed using the following approaches:

i. Consumer jury.

ii. Matched samples.

iii. Portfolio test or message recall efficiency.

iv. Storyboard test or image retention through video clipping.

v. Other mechanical devices.

The assessment of the effectiveness of the advertisement in the post-insertion stage needs to be done on the basis of audience exposure, attitude and change in attitude and turnover effect in terms of sales volume. The controlled field experiments may also be conducted to assess the attention on the advertisement, comprehensiveness of the message, technical execution of the advertisement and the overall impact.

Effectiveness in Advertising :

Print advertising typically tends to work more slowly than television or radio. Therefore, an especially long period of time (or an especially heavy media schedule) is required to fully evaluate the total effects of print advertising. Advertising for new products is more effective than advertising for established products. It’s easier to create effective advertising for new products, in other words, than it is for established products.

The inherent ‘news value’ of new products is the principal reason new product advertising is more effective. Given the greater effectiveness of new product advertising, one of the most common marketing mistakes is failure to take advantage of this inherent advantage (i.e., to underspend on introductory advertising for new products).

The persistently high advertising failure rate results primarily from lack of an accurate feedback mechanism, a lack of testing and evaluation. If an agency doesn’t know when its advertising is bad or why it is bad, how can the agency possibly improve its advertising? Marketing research can provide this feedback, but it is too expensive for the typical advertisement or commercial.

The degree of sales effectiveness can vary greatly from one commercial to the next. One commercial might be several times more effective than another. This indicates that the quality of advertising tends to be more important than the quantity of advertising. Nevertheless, the quantity of advertising (i.e., the media weight) must achieve a threshold level for the advertising to have any positive effects.

Limited telephone tracking research (and this can be done with small budgets) can monitor the cumulative effects of advertising upon awareness, brand image, and consumer attitudes, and is one of the simplest and most effective ways to make sure that your advertising is doing its job. Message recall is a positive factor, but its importance should not be overstated.

Brand registration, however, is always important (as opposed to message/element recall). If consumers don’t remember the brand name, the effectiveness of the advertising is correspondingly reduced. Failure to register the brand name is one of the most common weaknesses of the commercials. When next you review your advertising, just make sure that the brand name is clearly stated and clearly shown in the commercial.

Advertising effectiveness cannot be determined by any one measure, such as persuasion or recall. Recall is a good measure for some commercials, but not for others. Persuasion scores don’t work very well for brands with high market shares, and cannot be relied upon for brands in poorly defined product categories. Purchase intent works reasonably well for new products, but poorly for established products.

A large number of important variables must be examined to judge the potential effectiveness of advertising. The commercials on AM/FM radio can be as effective, or more effective, than television commercials on the basis of sales return per dollar of media. Typically, production budgets of commercials for radio are much less than television and radio commercials are rarely submitted to the rigors of marketing research evaluation.

Notes on Marketing # 19. Integrated Marketing C ommunication (IMC):

As per American Association of Advertising Agencies, Integrated Marketing Communication (IMC), is a concept of marketing communication planning that recognises the added value of & comprehensive plan that evaluates the strategic roles of a variety of communication disciplines (advertising, sales promotion, public relation, personal selling and publicity etc.) and combines the disciplines to produce clarity, consistency and maximum communication impact.

The purpose of IMC is to unify the company’s brand images and messages and communicate a common theme and positioning. AMC helps the company to build a strong brand identity in the market-place.

All kinds of promotion play the role of communication channels between the marketer (the source and the sender of message) and the consumer (the receiver of the message). Promotion as an element of marketing-mix has three broad objectives- (a) information, (b) persuasion, and (c) reminding. The overall objective of promotion is, of course, influencing the buyer behaviour and his pre-dispositions (needs, attitudes, goals, beliefs, values, and preferences).

The promotion-mix elements have a definite role in all stages of the selling process. Publicity is more effective in the awareness stage. Advertising gradually becomes less and less effective over a time-span. Hence, reminder advertisement it necessary.

Personal selling becomes more and more effective as interpersonal interaction assumes increasing importance. Closing of sales needs not only personal selling but also sales promotion tools at the point of purchase, in order to provide additional incentives for buyer’s action.

All these tools have one common objective i.e., communicating a message to the customer. For communication to be effective, the receiver has to understand the contents of the message. The message is based on unique features of the product, features that are appealing to the consumers, comparison of brands, competition, and the position of the product in the minds of the customer.

Very often, companies make use of different promotion media and methods to pass on the message about products and services to consumers. Lack of clarity and consistency in the message from different sources may lead to confusion in the mind of the target audience. To avoid such a problem, companies are now following the concept of IMC. IMC involves co­ordination and integration of all marketing communication tools and resources within a company that minimises the impact on target consumers.

The participants in IMC process include the company (the advertiser), Advertising agency, Media organisations and communication specialist. Example- Companies such as Xerox, IBM, and Motorola have initiated IMC by bringing together people from advertising, personal selling, public relations and publicity to ensure consistency and uniformity in the messages about product and services.

IMC is based on master marketing plan. The marketing plan makes effective use of marketing-mix including promotion efforts. Promotion is a form of communication with an additional element of persuasion. Marketing communication may be distorted particularly when a message passes through a number of channels and may lead to confusion in the mind of the consumers.

Therefore, there is a need for co-ordination and integration of all communication tools and resources to maximise the impact on consumers in a cost effective manner.

Notes on Marketing # 20. Rural Marketing:

Rural markets in India are fascinating and challenging. They offer a large scope on account of their sheer size and demand base. However, they pose many complex problems like poor communication and distribution facilities, low literacy level, thinly populated and scattered markets, poor standard of living and socio-economic and cultural backwardness.

Rural marketing problems arise out of peculiar dynamics of the rural markets in India. Uniqueness of the rural consumer, uniqueness of the structure of the rural markets and the peculiarities of the distributional infrastructure in rural areas are some of the pertinent issues to be dealt with.

Practically, in every aspect of marketing, rural markets pose certain special problems, but the following points are found to be important from the Marketing Management point of view:

i. Distribution logistics, storage, transport and handling;

ii. Location and degree of concentration of demands;

iii. Dealers’ attitude and motivation;

iv. Consumer motivation and buying habits;

v. Mass communication media, their reach and influence; and

vi. Organisational alternatives.

For any marketer to cover the 5.76 lakh villages is a formidable as well as a mysterious task. There are many villages which are not connected by rail or road. Rural markets bristle with many variety of problems and for a successful footing, a marketer has to grasp these problems and provide innovative solutions to them.

“The Rural Society is urbanising gradually with the increase in literacy rates and exposure to global trends”.

The given statement is in line with the current marketing scenario because of the following various reasons:

(i) Marketers are realising the importance of rural marketing. They consider rural areas as untapped and new markets with lots of opportunities. Thus they themselves advertise their products in the villages making people aware about the global trends.

(ii) Due to land acquisition policies of development authorities, villagers are getting richer day by day. Thus villagers are also now looking for comfort and luxury.

(iii) Because of infrastructure development, government reforms in education sector and availability of funds, more and more children of rural areas are coming to the Metros for getting an education.

When these children get exposed to global trends and technological advancements, they educate their parents, neighbourhoods and other people in rural areas thereby making them aware of the urban lifestyle.

Notes on Marketing # 21. Advertising:

As the marketing environment, advertising also works in an environment that may be understood by studying the conditions under which it functions.

The environmental factors affecting advertising are given below:

i. Social and cultural factors,

ii. Market competition related factors,

iii. Legal factor, and

iv. Economic factors related to business and consumer.

These factors nurture advertising and as well as other related functions like marketing. The environment helps planners to asses the extent of the investment needed and to accordingly decide the advertising strategies. Environmental conditions provide a base for formulating the advertising policy and to provide magnitude and direction. The contemporary advertising system is an example of a “free enterprise” environment.

The socio-cultural environment comprises of shared beliefs, social values, customs, life styles, ethics and community behavior. These components play a major role in shaping the behavior of consumer. Thus advertising should keep to the social cultural standards and if failing to do so, the consumer should resolve not to buy the advertised product.

A competitive environment provides more options to influence the consumer. Hence, to plan strategies for effective advertising, there is a need to look into the product policies, distribution approaches, pricing mechanism and promotional strategies with reference to competitive products and their sustainability in the market. The legal environment consists of enforced regulation under which advertising has to be developed and exposed.

Business fluctuations, the broad economic framework for establishing business at the embryonic stage, prospects and political stability form the economic environment for developing advertising plans. Thus, it is difficult for any advertiser to ignore these factors while planning advertising within the given economy of the country or region.

There are many other factors which have stake in the advertising environment and play a significant role in determining policies for effective advertising as a communication and marketing tool.

These factors are:

i. Technology development,

ii. Growth in per capita income,

iii. Increase in disposable income,

iv. Higher purchasing power of consumer,

v. Growth of popular consumer clusters,

vi. Development of infrastructure,

vii. Increase in education standards of consumer,

viii. Specialization in advertising techniques,

ix. Use of research and development results,

x. Growth of brands and variety of trade,

xi. Growth of service sector, and

xii. Growth in marketing finance.

The scope of the advertising is very wide and leads to an integrated impact on the planning process.

The Advertising Process :

Advertising is closely associated with marketing variables. Hence, the process of advertising depends largely on the market environment. The marketing plans enables the advertiser to set objectives, the advertising budget and the time plan for scheduling the advertisement. In an advertising process the important determinants are communication strategy and media strategy.

The strategy for communication includes the type of message to be released, its length, contents, audience interest, product characteristics and frequency of message dissemination. The message tactics also need to be developed in accordance with the media and media watchers. An appropriate media strategy is selected by analyzing media responses carefully. On selection of appropriate media, an operational plan putting the advertisements through needs to be developed.

The whole advertising process results in the exposure of the advertising product as an output that needs to be evaluated for its effectiveness in a given marketing situation. The media consultants, media representatives, and advertising agencies form the organizational structure and within its frame the process of advertising is made functional. The response analysis of advertisement shows mixed impacts.

Sometimes the advertisements receive a very positive response from consumer, augmenting the market for the product, while at the same time negative responses also distort the product market. Such cases need to be subjected to research on the improved communication styles and the media vehicle in order to recharge the advertising planning process with new inputs.

Advertising Categories:

Advertising is a creative task and varies according to the need and taste of the target group. It can be categorized into audiences, types of advertiser, mass media and functions. There are three sets of audience in advertising-business, professionals and consumers. The business-to-business advertising is directed towards processors, wholesalers and professionals.

An advertisement carrying a message for raw materials, business machines or services to the manufacturing units are categorically of a business-to-business nature and can be termed as industrial advertising. Similarly when an advertisement is directed towards a group of professional like engineers, doctors, it is called professional advertising.

The advertising audience may also be categorized as a mass or a class. An example of advertising for biscuits may be planned for the mass audience while a rich processed and canned food may be directed towards high-class audience.

The volume of the business of a company and the geographical coverage of the product would be another consideration for classifying advertising strategies. The countrywide coverage of a product such as automobiles, television sets, refrigerators and the like is called general advertising.

Advertising for a product limited to regional markets for local consumption is defined as local advertising. Advertising can be also classified with reference to the medium used to deliver the message like national TV network, cable TV network, radio, newspaper and magazines of national and regional status.

The functional classification of advertising is of an illustrative and symbolic nature.

The advertising classification according to functions is given under:

i. Product advertising,

ii. Non-product or institutional advertising,

iii. Primary advertising,

iv. Selective advertising,

v. Direct action advertising, and

vi. Indirect action advertising.

Product advertising emphasizes the characteristics of the product and other related issues while the institutional image is build up by non-product advertising. The brand of the company, its public relation aspects and regulations is based on the theme of the advertising in this category.

For example, we have the Tata Steel Company which prefers institutional advertising, highlighting the biographical excerpts of the founder veteran or emphasizing the development nurtured by the company in rural housing, education, health and sports. Such advertising mentions the product of company as a secondary message.

Primary advertising attempts to promote a market for indigenous products which are largely unbranded while selective advertising is done for the products that are branded or that fall in line with related brands. Selective advertisement is used by individual companies to stimulate a market for their products after the demand has been established.

Direct action advertising generates instant demand for the product and is found to be an effective stimuli for short-run sale campaigns. The art of abstract communication is called indirect advertising which does not seek immediate attention of the mass audience. However, this type of advertising is appreciated by the class audience to some extent.

Notes on Marketing # 22. Service Marketing Mix:

The services marketing-mix consists of eight elements which are essential in the functioning of services. These elements are product, price, place, promotion, people, pace, process and physical evidence. In the mix each element is governed by various attributes. The product in reference to services may be defined as the package of services offered to the users.

The length and width of services define the product line and the life cycle of services. The price component of the services marketing-mix includes various pricing approaches and the extent of customization. The services are delivered in retail and on centralized basis directly to the customers either directly by the agency or by the franchisees.

The promotion of the services include communication and advertising approaches, direct marketing, public relations and personalized approaches. The participants for the services are internal and external customers, vendors of the services and animators. The services need to be evaluated periodically and improved accordingly.

The competitive strategies, brand positioning approaches, technological intervention, etc., will drive the company to sustain in the market and pace through competition in the services market. The services are delivered after the core and supporting processes and the documentation. The service providing companies may also work out the risk chart in delivery of services to meet the inadvertent situations to provide the clear status of delivery and intactness of the services to the customers.

It is important to understand the Service Life Cycle (SLC) as it provides insights on the competitive dynamics of the service being marketed. The SLC also exhibits the distinct stages in the sales history of a service. The SLC comprises four stages known as introduction, growth, maturity and decline. In the stage of introduction of the service in the segmented market the profit remains almost non-existent and service sales also remain slow.

However, the expenditure in pushing the service into the market is found heavy for the marketing firm. The service passes into the next stage of SLC – growth, with improved sales and profit conditions, observing the rapid acceptance of the service in the market. The service remains in the growth stage till the competition increases and pulls back the sales of the existing service.

At this juncture the service moves into the stage of maturity where it faces setback on the volume of sales but succeeds in sustaining the profit level. While passing into the stage of decline the service faces downward trend in both the volume of sales and profit.

Hypothetically, all the services in the market moves through these stages of life cycle but there could be some exceptions always. Some of the services get out of the market in the stage of introduction itself while few are thrown out of competition at the growth stage. At the stage of maturity the strategy for service diversification begins and some services fall out of the main stream of the service categories in the market.

Thus, the marketer should develop sustainable marketing strategies to survive his services at each stage of the SLC. The service requires high promotion at the time of introduction but the price of the service should be kept low as compared to its competing brands. Such strategy is known as high penetration strategy.

Once the brand becomes popular in the market, the expenditure on the promotion may be reduced and the service can be pulled to high price-low promotion bracket following the low skimming strategy.

A marketer has to make more crucial decisions at the growth stage of the service.

The major strategies to be drawn at this stage to provide adequate support to the service in the market are as under:

i. Rationalizing the service line and width.

ii. Innovative promotional approaches.

iii. Identifying new market segments.

iv. Evolving comprehensive distribution policy.

v. Changing the strategy of service awareness advertising to the service preference advertising and launching advertising campaigns accordingly.

It is essential at this stage of SLC to rationalize the service portfolio in the company and develop strategies to promote only such categories of service, which had gained considerable response from the consumers. Such service categories need to be promoted through innovative promotion approaches and giving more emphasis on the service preference based advertisements and advertising campaigns. However, the possibilities of exploring new market segments and comprehensive coverage of distribution need also to be worked out in the same stage of SLC.

The stage of maturity is the sustainable stage in the SLC. As there will not be encouraging growth in the profit through the service marketing, there exists enormous scope for developing the business relationships and renovating the service attributes. At the last stage of SLC, i.e., stage of decline, the strategies are built to re-launch the service in the same or new market segments. The more important need at this stage of SLC is to sustain the brand image and to the extent possible rebuild the same through service and institutional advertising.

Notes on Marketing # 23. Retailing:

The word retailing has its origins in the French verb retaillier, which means to cut a piece or to break a bulk. This refers to one of the fundamental retailing activities- to buy in larger quantities and sell in smaller quantities. For example, a convenience store would buy dozens of boxes of soaps but would sell in single units. However, a retailer is not the only type of business entity to “break bulk.” Wholesalers also buy in larger quantities and sell to their customers in smaller quantities.

Hence, it is basically the type of customer that actually distinguishes a retailer from other distributive traders and not the activity. The distinction here is that a retailer sells to final consumers, unlike a wholesaler who sells to a retailer or other business organizations. Thus, the definition of a retailer is “any establishment that is engaged in selling merchandise for personal or household consumption and rendering services incidental to the sale of such goods.”

The retailing business we see today is not the same as it was in the past. It has gone through the several stages of evolution in the way retailing is done. Retail business is still undergoing a rapid transformation in its marketing practices. Until a few years ago, we bought most items of daily use from small shops in our neighborhood (mom-and-pop store) or a market close by.

These shops such as Kirana stores or general stores or clothing and apparel shops are owned by individuals, who usually run the shop themselves and sell their goods with the help of a few assistants. Gradually, the department stores came into being due to the growing sophistication of this sector. This was the beginning of the organized sector. In the last few years, however, the concept of large departmental stores and shopping malls changed the face of retailing.

Today, the traditional formats like grocers, hawkers, and other mom- and-pop stores coexist with modern formats like departmental stores, supermarkets, hypermarkets, shopping malls, and non-store retailing units such as teleshopping and multilevel marketing.

On the other hand, with the advancement of information technology (IT) and communication, electronic retailing, which is also called as e-retailing or e-tailing, is a burgeoning phenomenon and has drastically changed the way the business of retailing is done. The growth of e-commerce has radically changed the way world does business in every conceivable aspect.

Today, the consumers can buy the products online from their electronic devices such as computers and laptops from the virtual marketplace from anywhere and at any time. The products are displayed on the shopping portal of the e-retailer and payments can be made through online payment systems like e-banking or by payment in cash on delivery (COD) of the merchandise at the place where the delivery is required.

In addition, there exist many businesses that carry out retailing activity and are not in themselves classified as retailers. For example, a factory may engage in retailing activity by selling its products in their own shop located in their manufacturing premises. The term “retailing” applies not only to the selling of tangible products, such as apparel, electronic goods, or pairs of shoes, but also to the selling of services.

The consumption of the service offered coincides with the retailing activity itself. Companies that provide food items, traveling services and aromatherapy sessions are all essentially retailers, as they sell to the final consumer, and yet customers do not receive goods from these retailers in a shopping bag.

Thus, this article will mainly focus on introduction to the business of retailing, its significance, and the emergence of various formats in retailing. Hence, this article mainly deals with the understanding of the concept of retail business and functions performed by a retailer.

It will also cover the analysis of retail sector industry in India and implications of the recent foreign direct investment (FDI) policy in retail sector of India. We will also try to understand the legal framework and provisions, regulatory environment, and strengths, weaknesses, opportunities, and threats (SWOT) in the context of changing dynamics of Indian retail landscape.

Notes on Marketing # 24. Strategic Marketing:

The strategic marketing delineates 3Rs emphasizing the right products for right growth markets at right time. These issues are also highlighted in the marketing management but from a different perspective. The resources of the firm are identified as uncontrollable variables of the marketing mix in the process of marketing management while the strategic marketing systematically defines all the variables and examines its necessary inputs to maximize the corporate performance.

Strategic marketing is a plan of all aspects of the strategy of an organization in the market place unlike a simple marketing plan that deals with so-called marketing mix. Strategic marketing differs from marketing management in many areas like orientation, core philosophy, approach, and relationship of business organization with various environmental variables. One of the prominent differences between the strategic marketing and marketing management is the temporal framework.

The strategic marketing deals with long range planning and the decisions thereof would have long-term implications. The inductive and intuitive attributes dominate the strategic marketing process while marketing management is largely oriented towards analytical examination of the associated marketing factors and its implementation.

The strategic marketing advocates the democratic decision-making process which is defined as bottom-up approach while in the marketing management the flow of directions are from top-down to make decisions.  In the strategic management process environment is considered as ever changing and dynamic.

On the contrary the marketing management assumes that the environment is constant for effective implementation. However, occasional changes are noted in the marketing management. The continuous search of opportunities is one of the major focuses of strategic marketing and is aimed to explore the opportunities for optimizing its business goals in the long run.

However, an ad-hoc search is conducted in the marketing management process to find new opportunities. The marketing management has a narrow profit center approach while the strategic marketing pursues broad objectives of achieving synergy between different components of organization, both horizontally and vertically.

The strategic marketing activity requires high degree of creativity and originality in the approach. The implementation, control and monitoring skills are preferred in the marketing management activity unlike the strategic marketing. Strategic marketing needs a proactive perspective and the marketing management requires the reactive perspectives for effective leadership.

A division of Cargill Corp. developed its strategic direction that would take it from a commodity type business of egg production to a value-added, broader definition:

We will be a leading marketer of quality, value-added egg based food products serving primarily the food service industry. We will be a least-cost producer and a leader in developing and implementing innovative products and processes to meet the needs of an evolving marketplace.

The statement reflects a clear and pragmatic vision that moved the division away from its orientation of just dealing with fresh egg production to one of going to the next step by preparing and packaging ready-to-use egg-based products for all types of institutions. These statements are no more word play.

Rather they have a practical application in creating a workable mental set whereby managers can envision how a product line or business might expand over the next three to five years. In turn, the statements help shape objectives, strategies, and a portfolio of products and markets.

If you view the basic product as railroad cars traveling on parallel tracks down a path, the result is a shortsighted business condition that, in turn, confines products, services, and market development on a narrow dimensions.

Redefined as a transportation company, however, the strategic vision includes transportation of all types – air, water, space, and diverse forms of transportation still unknown. Since Railroads Company owns land on either side of the tracks, a transportation viewpoint can conceivably include laying underground pipe to transport food, fluids, chemicals, and power lines.

This type of expansive strategic thinking is not limited to the private sector of profit-making corporations. It applies equally well to the public sector. Consider the March of Dimes Defect Foundation, an organization that was originally dedicated to the cure of Polio. Fortunately, polio is no longer a serious threat.

Does that situation mean that March of Dimes is out of business and can serve no useful functions? Not at all. By redefining its mission or strategic direction as birth defects, the organization is alive and well, using its skills and resources in a broader mandate to serve societies needs.

Even companies with strong positions in the market place and with profitable businesses are redefining mission statements to embrace the inevitable movement towards new technologies. For example, consider GTE Directories Corp., the producer of the familiar telephone directories known as Yellow Pages. Its basic business consists of selling advertising space, the volumes, and distributing the directories.

At one point GTE defined its business purpose and developed the following mission:

A worldwide integrated and marketing corporation of directional hard copy and electronic advertising media and informational services.

Does the mission specifically state that the company is the producer of the Yellow Pages? Not at all. Does the statement include that product? Yes, by using the phrase “directional hard copy”, it includes the product line of Yellow Pages.

Yet the clear implication is that the manager can think expansively of new products that may take different forms. Now consider the phrase “electronic advertising media”. Taking into account the evolving use of the Internet and the yet-to-be developed technology, GTE can link up to new media that can augment its Yellow Pages or, in time, even displace it.

This portion of the mission permits managers at all levels of the company to open their minds to new possibilities, while still remaining consistent with GTE’s basic business. Finally, the phrase “information services” opens the window into expansion areas as developed countries move increasingly towards service economies and information transfer, thus building “a worldwide integrated publishing and marketing corporation”.

Yet, how far should thinking go towards a market-driven orientation? It is the best to initially think as far toward that orientation as possible, and then come back to a more comfortable position somewhere between the two extremes of a product-driven and a market-driven orientation.

That position is usually based on the following factors:

i. The culture of the organization, with the broad range of behaviors exhibited as conservative to aggressive.

ii. The availability of human, material, and financial resources for maintaining existing business functions and for investing in future growth.

iii. The amount of risk that the management is willing to assume in going into debt.

iv. The degree of environmental change that is anticipated in market behavior.

v. The threat of competitive activities and their impact on survival and growth.

Even surrounded by these factors, think as expansively as possible. On the other hand, staying rooted to a product-driven orientation ultimately bogs you down in mature and then declining business. If you hold responsibility for company, business unit, or product line, then responsibility for conceptualizing a mission or strategic direction begins with you-regardless of level in the organization.

As such, you are no longer a victim of a narrow focus that ends up with mature products, price wars, and other competitive conflicts. The broader market-driven viewpoint permits you to think more expansively about business, market, and customer needs-not just products.

Notes on Marketing # 25. Demand Forecasting:

Marketing information system including marketing research, gives an insight into available market opportunities. It is very essential for a company to understand the quantum of demand in the market. The assessment of demand leads to plan the finances, manufacturing, purchases and human resources.

Demand forecasting is a quantitative estimation of the demand of a product or service by customers during some defined future period. The demand forecasting can be done either for the industry or for a company or its individual products.

For example – Demand forecasting can be done for Soaps on the whole and then it can be done for say, Hindustan Unilever Limited (HUL) and then it can be done for an individual brand say, Lux.

Demand forecasting for a multinational corporation like Tata Group companies say Tata Motors can also be done at global, country, region, state and district level. Again the forecasting will be different for various products / services and its different brands and its variants.

Right from Jaguar, Land Rover (JLR) to Tata Motors’ commercial vehicles to passenger vehicles will all form the complete picture. Thus, right from Tata Nanos to Tata Arias to Tata Trucks and Buses to Jaguars and Land Rovers will complete the picture of Tata Motors.

Demand forecasting can be done either for short term, say a quarter or three to six months or it can be done for medium term between one to three years or it can be done for a long period say five to ten years. The duration also varies depending upon the nature of the business. Generally core infrastructural sector’s time frame will be much longer than say a FMCG company.

Although the long term demand forecasting is very important from the business planning, financial planning and manpower planning purposes, yet with the dynamic business environment today, a company needs to keenly watch and plan for short term as well as medium term requirements.

With volatility in the business environment today, coupled with technological and other changes; a company needs to look out for short as well as medium term forecasting. In the short term, a company may gain form planning for the right manufacturing schedule, right purchasing schedule, right financial schedule and realistic sales targets.

Notes on Marketing # 26. Business Markets:

In Business market, the buying and selling takes place among businesses. According to Dwyer and Tanner, ‘It include companies that consume products or services, government agencies (Local, State and National), institutions (Schools, Hospitals, Nursing Homes, Churches, Charities) and resellers.’

It is also known as industrial marketing or business to business (B2B) marketing or Organisational Marketing.

Webster and Wind has defined organisational buying as the decision making process by which formal organisations establish the need for purchased products and services and identify, evaluate and choose among alternative brands and suppliers.

As far as size of the business market is concerned, ‘Business marketers serve the largest market of all; the dollar volume of transactions in the industrial or business market significantly exceeds that of the ultimate consumer market.’ For example, companies such as GE, DuPont and IBM spend more than $60 million a day on purchases to support their operations.

Dwyer and Tanner has also stated that the purchases made by companies, government agencies and institutions ‘account for more than half of the economic activity in industrialized countries such as the United States, Canada and France.’

Although the business market is bigger than the consumer market, yet only consumer market is seen and heard by you. It is because consumer market rely more on advertising and promotions to reach to its millions of consumers. While, in business markets, the number of buyers and sellers are quite small with respect to consumer market. For example – If you take into account the tyre suppliers to an automobile company like Maruti Suzuki in India.

Then Maruti Suzuki will source five tyres (four for the car and one for the reserve stepney) for every car, it manufactures. The sourcing of tyres can be done from any one of the six leading manufacturers of tyres (Apollo, Bridgestone, Goodyear, JK, Ceat and MRF). On the whole, there are just 16 leading car manufacturing companies (Hindustan Motors, Maruti Suzuki, Hyundai, Chevrolet, Tata Motors, Ford, Skoda, Mahindra & Mahindra, Renault, Fiat, Volkswagen, Nissan, Honda, Toyota, Mercedes and BMW) in India. The business market equation is 16 automobile companies sourcing tyres from 6 tyre manufacturers.

In this respect, the market becomes quite small to be targeted easily on a company to company basis. In turn, it also nullifies the need for advertising and promotions. That’s why business market is not seen and heard, yet it generates more business than the consumer market. In the same tyre market, all the tyre companies need to advertise and promote their product heavily for the replacement market of the tyres, which is also called aftermarket.

Notes on Marketing # 27. Rural Marketing Mix:

a. Products:

The product’s attributes should match with the need and requirements of rural people. Some of the products can be offered in the same way as to urban consumers, but smaller pack size, can make the unit price affordable to common customers. Products for the rural markets will have to simple and easy to use and maintenance. Product packaging need to be functional and capable of dispensing smaller units of the products, for example, sachet packaging of Shampoo, coffee, tooth paste etc. Brand identity may be created through the visual logos and pictures. Products should be customized to suit the socio cultural and rural economic environment.

For example, Philips has come out with smokeless chulhas for rural market. There are possibilities of solar powered electronic products due to frequent power cuts in rural areas. Companies should sell high value brands not cheap brands. The urban buyers may look for low price but they are brand conscious.

There are problems in transportation and warehousing in rural marketing due to poor transportation network. These constraints can affect the maintenance and after sales services of a company. The physical distribution costs in rural areas are higher as compared to urban areas. By facilitating product delivery, companies can make direct contact with rural consumers. The weekly rural market Haat is an effective distribution point firms can link with different villages through its van.

The prices of products and services should be affordable by rural peoples as the average income level is low as compare to urban people. Rural consumer is price sensitive. They can offer smaller units or packs at a lower price. It does help to design specific products at specific price points for the rural market. Firms may benefit by offering distinctive payment in terms for the rural market. Some buyers need credit which can be extended till harvest time. Companies may go for common pricing strategy for rural and urban market. There is a good scope for occasional pricing especially at the time of marriage, festivals and harvest seasons.

c. Promotion:

The characteristics of rural segment are different as compare to urban segment, the literacy rate is low, and the marketing communication should be in local idiom. The target audiences in rural areas are fragmented location wise and media habits. Therefore media mix should the carefully designed. Visual copy has a much greater appeal than just audio and print media, wall paintings, posters and advertising at point of purchase like stickers and shelf display are effective tools of promotion.

The radio is a well-established medium of communication in rural area. Audio Visual van is an effective tool in rural promotion. It can easily cover the scattered rural population. There is need for specialization in developing and delivering the message, the copy, language and the delivery must be according to the rural context. The large scale communication programme in which team of communicators meet rural audience in interactive sessions and also carry out demonstration would be an effective technique.

Unique Selling Propositions should be adopted by the marketers which involve presenting a theme with the product to attract the client to buy that particular product. For examples, some of famous Indian Farm equipment manufacturers have coined catchy themes, which they display along with the products, to attract the target client that is the farmers.

d. Sales Force Management:

Rural marketing involves more intensive personal selling efforts. Salesmen must be able to guide dealers and consumers in the choice of products. They must be well-acquainted with the rural cultural aspects it is better employ those people who feel happy in working in the village environment. Scattered location of retail outlets is a constraint in rural marketing. Sale force management in the rural context is indeed a difficult task it require high motivation and positive attitude.

Notes on Marketing # 28. Brand Positioning:

Brand positioning is a marketing strategy which aims to make a brand occupy a distinct position, relative to competing brand, in the mind of the customer. Once a brand is positioned, it is very difficult to reposition it without destroying its credibility.

Brand positioning simply means target consumers’ reason to buy a particular brand in preference to others. It is an activity of creating a brand in such a manner that it occupies a distinctive place and value in the target customer’s mind.

It involves identifying and determining points of similarity and difference to ascertain the right brand identity and to create a proper brand image. Kotler defines brand positioning as the act of designing the company’s offering and image to occupy a distinctive place in the mind of the target market.

In other words, brand positioning describes how a brand is different from its competitors and where or how it sits in the minds of the customers. Hence a good brand positioning strategy involves creating brand associations in customers’ minds to make them perceive the brand in a specific way.

Brand Positioning ensures that all brand activity has a common aim, is guided, directed and delivered by the brand’s benefits/reasons to buy.

BP must be able to answer the questions:

i. Is it unique/distinctive w.r.t., Competitors?

ii. Is it significant and encouraging to the niche market?

iii. Is it appropriate for the targeted geographic markets and businesses?

iv. Is it helpful to the organisation in achieving its financial goals?

v. Is it able to support and boost-up the organization in terms of sales?

vi. Is it sustainable? etc.

BP involves identifying and delivering points of similarity and difference to ^ ascertain the right brand identity and to create a proper brand image.

Notes on Marketing # 29. Online Retailing:

Online retailing is going through a negative phase since the crash of most of the dot-com companies in recent years. However, it is not the end of online retailing in India, simply because net access and PC use is growing by leaps and bounds.

The e-commerce scenario has not been too bad in India. In retail banking, Indian banks have been pretty successful in adapting the technology to provide customers with facilities like real-time account status, transfer of funds, bill payment and so on.

The future does look bright for online retailing in India and the areas expected to-grow include financial services, travel, entertainment and groceries. For those considering opening a virtual storefront, the forthcoming technology and agreements on standards will not only make setting up web-sites easier, they will also safeguard them against payment fraud.

On the downside, some experts feel that it will be increasingly difficult for smaller sites and the online version of mom and pop shops to attract customers. On the other hand, big stores and larger organizations with established brand names and deep pockets may do well.

Retailing has been defined as business activity in selling goods and services to consumers for their personal, family or household use. Although retailing has been around for millennia, the twentieth century has witnessed a lot of change in the retail sector, especially in the developed countries.

Indian retailing is undergoing a process of evolution and is poised to undergo dramatic transformation. Today, more prospects are generated in e-business because of lower costs and increase in revenue. The enhancement in productivity and a response to new customer and competitive demands is also one of the reasons for e-commerce. E-business involves careful planning, preparations, development, execution and refinement. E-business should complement your traditional business strategy.

The success of the online retailing or e-tailing remains of five different rules that are:

1. The product or service must be ideally suited to the existing market and to what people want, need and are willing to pay for.

2. There must be a company-wide focus on marketing, sales and revenue generation.

3. Efficient internal system of book-keeping, accounting, inventory management and cost control must exist.

4. There must be a clear sense of direction and a high level of synergy and teamwork among managers and staff in organization.

5. The company should never stop learning, growing, innovating and improving.

The future does look bright for online retailing in India and the areas expected to grow include financial services, travel, entertainment and groceries. For those considering opening a virtual storefront, the forthcoming technology and agreement on standards will not only make setting up web-sites easier, they will also safeguard them against payment fraud.

The recent development of sending e-greetings has helped customers get into the habit of using the Internet. Another area of development is bill presentment and e-ticketing. Retail banking and related services through the Internet are also being promoted and a good deal of transaction takes place through the Net. Shopping robots on the Net help instant price comparisons to enable customers make purchase decisions.

The key success factor for online retailing is efficient logistics to ensure that the right product is delivered to the right customer at the right time. The supply chain network is triggered in an automatic fashion, meeting promised delivery dates. There is good scope for promoting on-site products merchandised and sold online.

The site itself can host links of products/services offered by other companies for a fee. There is a lot of opportunity to create customer stickiness by constantly communicating with them through e-mail. Personalized offerings can be made to individual customers based on individual’s shopping characteristics.

The major pitfalls of e-tailing are as follows:

No Theatrical Ambience – The online retailing site does not have a theatrical ambience that can be felt by the customer.

Intangible Merchandise – The customer cannot hold, smell, feel or try the product.

No emotional experience – There is no emotional shopping experience that the customer can get in e-tailing as he would in a brick and mortar environment.

Security Issues – Customers online are relevant to part with their credit card details on the net, fearing they may be misused.

Impersonal customer service – Indian customers are used to tangible personalized customer service which online retailing cannot provide.

As in brick and mortar retailing, online retailing too has its thin challenges.

(i) Getting clicks which is equivalent to footfalls in physical store retailing.

(ii) Conversions into buying from among the clicks, which is equivalent to conversion from footfalls.

The advantages of online retailing are as follows:

i. An opportunity to move from physical space to cyberspace.

ii. No location boundaries.

iii. Wider spectrum of customers.

iv. Non-geocentric buying habits of customers.

Online Store Front — Creating a Look and Feel – Every e-tailing site has a storefront with an identifying, image and positioning. The online storefront has its signature identified with features that trigger off browsing and persuade customers to buy its product offerings.

Visual Density – Online retailers use visual density very effectively to promote offerings and sell merchandise.

Online Merchandising – One of the major advantages of online merchandising is that the site can have an unlimited number of SKUs on display.

Expenses being low, there is potential for high margins in e-tailing. Online Pricing – Prices of merchandise online are competitive compared to brick and mortar stores. This is because operating expenses saved by working through the Internet are generally passed on to the consumer.

The online retail segment is buzzing again with the entry of sound business with estimated business 300 $ billion in this year and + 427 $ billion by 2010.

Today, the buzzword across the world in retailing is diversifying. Currently, it is estimated to be contributing 23% to the B2C market and is expected to account for nearly 60% of the B2C market in the near future. With Indian Railways and domestic airlines conducting the online sale of tickets, this segment is expected to grow at a phenomenal rate of 140%.

Recent Trends of E-Tailing in India :

The recent development of sending e-greetings and e-ticketing has helped customers get into the habit of using the Internet. The railways and airways are providing tickets through the Net which is very convenient to the customer. Another area of development is bill presentation.

Retail banking and related services through the Internet is also being promoted and a good deal of transactions takes place through the Net. Shopping robots on the Net help instant price comparisons to enable customers make purchase decisions. Storing merchandise in satellite warehouses enables timely delivery in operations that are spread over a wide area.

There is good scope for promoting on-site products merchandised and sold online. The site itself can host links of products/services offered by other companies for a fee. Banners, crawlers, browser buttons, URL Links etc. can be put on other non-competing sites.

There is a lot of opportunity to create customer stickiness by constantly communicating with them through e-mail. Personalized offerings can be made to individual customers based on individual’s shopping characteristics.

Some instances of Indian companies doing business on the Net:

i. Rediff(dot)com does a good deal of merchandising on its site with innovative product offerings and prices.

ii. Indiatimes(dot)com is a popular internet selling site with multifaceted merchandise offerings.

iii. Bazee(dot)com is a site very widely known in India for its ‘bidding sale’.

iv. Fabmart(dot)com does food relating.

v. Playwin is an online lottery that is catching on with the masses.

The e-commerce scenario has not been too bad in India. In retail banking, Indian banks have been pretty successful in adopting the technology to provide customers with facilities like real-time account status, transfer of funds, bill payment and so as.

The future does look bright for online retailing in India and the areas expected to grow include financial services, travel, entertainment and food groceries. For those considering opening a virtual storefront, the forthcoming technology and agreements on standards will not only make setting up web-sites easier, they will also safeguard them against payment fraud.

Notes on Marketing # 30. Personal Selling:

Personal selling involves face-to-face contact between the seller and the prospective customer with an intention of selling some product. Salesmanship is the art of presenting an offering that the prospect appreciates the need for it’s and ultimately buys the product. The purpose of personal selling is winning a regular customer.

Personal selling is the process of assisting and persuading a prospective buyer to buy a product in a face-to-face situation. It involves direct and personal contact between the seller or his representative with the prospective buyer. It is one of the most effective methods of selling the products. Personal selling is by far the major promotional method used to increase profitable sales by offering want-satisfying products to the customers.

According to Pederson and Wright, “Salesmanship is the process whereby the seller ascertains and activates the needs or wants of the buyer and satisfies the needs or wants to mutual continuous advantage of both the buyer and the sellers.” Salesmanship or personal selling involves face-to-face contact between the seller and the prospective customer with an intention of selling some products. Salesmanship is the art of so representing an offer that the prospect appreciates the need for it and that a mutually satisfactory sale follows.

What is Personal Selling?

i. “Salesmanship is the process whereby the seller ascertains and activates the needs or wants of the buyer and satisfies the needs or wants to mutual continuous advantage of both the buyer and the seller.” —Pederson and Wright

ii. “Personal selling consists of winning the buyer’s confidence for seller’s house and goods thereby winning a regular and permanent customer” —G. Blake

Personal selling is pervasive in nature. It results in many benefits to the seller and also the buyer. Aggressive salesmanship or selling by pressurising the customers can pay only in the short-run. Aggressive selling is ethically not good. A good salesman should assist the prospect or customer in satisfying his needs by the purchase of products or services according to his capacity. Thus, modern salesmanship is creative in approach. The salesman should use problem-solving approach to ensure customer satisfaction.

Related Articles:

• Difference between Marketing and Selling
• Industrial Marketing Research: Concept and Nature and Scope| Business Marketing
• Marketing Functions: 12 Essential Functions of Marketing – Discussed!
• 4 Ps of Marketing Mix | Marketing Management

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What is brand research?

Providing objective evidence to harness abstract concepts for leveraging brand strength and persuading customers to curry favour., what is brand market research.

Brands are not defined just by their products or services.  A brand is made up of much more; it has its own personality (contributed to by its employees), its own mission statement, its own goals, its own ethos, even its own humour (see Innocent drinks for an example).  However, a brand’s perception is not owned by the brand itself, rather it is owned by the customer, based on how they see and feel it.

A clever brand will spend time understanding how its communications and messaging alter brand perception, and much of this is done via communication with its customers.

Brand marketing research aims to provide a form of conversation:

Conversation is not simply a two-way process, but also a continuous process.  Brand research enables brands to ask the questions and listen to their customers, allowing them to keep their finger on the pulse and adapt appropriately.

Brand research definition

Brand research specifically assists in the creation and curation of strong, distinctive brands.

Brand market research helps achieve competitive advantage through objective, insight based ideas and recommendations on product, service or customer service strategies. 

Marketers, planners and strategists are then able to make confident, informed judgements on the endless decisions around target markets, pricing, positioning, distribution, partnerships and so on.

What is brand analysis? 

Brand analysis specifically focuses on understanding what drives business and brand value, hence it’s often a potentially wide sphere of activity.

Manufacturing or product driven companies will often start the value creation process from a functional or physical stand point, viewing life through the lens of ‘ how can we apply what we have ?’. Marketing or service driven companies will start from the opposite end of the spectrum viewing life through the lens of ‘ what do customers want, how can we deliver it? ’.  Traditional marketing text books tend to favour the former approach, but a surge of more customer-centric activities are currently taking place in the real world.

Inevitably both outlooks will meet in the middle somewhere, talking of brand identity, value or equity. Most organisations want to overcome the barriers of negative perceptions or leverage the positives they have, whether it’s for survival or ambitious growth. Or they might simply want to keep checking they’re projecting an authentic, consistent image and manage risks .

What’s the difference between a brand audit and brand analysis?

The comprehensive, systematic and independent review of a brand can also be called a brand audit and typically has the aim of assessing the equity of a brand. Brand audits shouldn’t be confused with marketing audits though.  The latter tends to be an internally focused exercise, while a brand audit is more externally, customer focused, even if it incorporates the review of financial metrics too.

The analysis itself is the process of developing appropriate strategies, evaluations and metrics for managing and measuring a brand’s success.

Fundamentally each brand analysis or audit exercise needs its own objectives (e.g. to drive loyalty vs change positioning etc.) and can choose to use the scope (e.g. current vs non customers) and emphasis that best suit it.

Brand analysis is most commonly executed once a brand is established. Although marketing research can of course be used to inform brand values from the off.

What is a brand association, attribute or perception?

We’ve already come across a number of interchangeable or similar terms used in the world of marketing and brands, so it’s probably worth having a look at what some commonly used branding stages and phrases mean.

What’s more important, understanding the tangible or intangible elements of a brand?

While many brand attributes are tangible such as the name, logo, features, customer touchpoints etc. it’s how they come together to create psychological triggers or stimulus that create the brand value. On the way to doing this many intangible assets or situations are created.

It can be argued that these intangible brand elements such as relevance to the customer, preference, recognition, loyalty or brand promise are the most important as they drive brand reputation and perception. 

Tangible assets are more readily identified in general, and by the brand owners specifically.  However, external expertise can be invaluable in defining and evaluating the intangible aspects, particularly when reviewing the less familiar territories of non-customers or new geographies.

The importance of brand perception

Given that brand perception is owned by the customer (or conscious non-customer) and not the brand, it’s pertinent to make an effort to appreciate what’s going on there. Brands rarely exist in isolation, so measuring the brand perception of your competitors can help you understand where strengths and weaknesses lie.

Brand perception is how consumers think, feel, and respond to a brand as a result of their interactions and experiences with it. A brand experience can encompass everything from talking to a family member, reading online reviews, to seeing a magazine advertisement. Gossip and reputation is a very powerful thing, the University of Chicago even have a study to prove the correlation.

Once a brand has an understanding of their own perception, they can drive changes in brand positioning, leading to increased brand loyalty and a more relevant brand identity and improved brand equity.

Understanding and measuring brand perception

We can either view brand perceptions in terms of:

1. Brand sentiment :

• Positive:  due to positive experience with the brand it has become a preferred choice for the consumer
• Negative:  negative experiences have led to negative perceptions, which in turn leads to an avoidance or dislike of the brand itself
• Neutral:  the consumer has not had an emotional experience or response to the brand, and thus feelings are indifferent

 or in terms of

2. Brand visualisation maps:

Brand perception mapping identifies the closest competition and their differentiating factors. It also measures positive and negative brand perceptions and associations. More details about the consumer or B2B brandmaps can be found here .

When reviewing the perception maps (or any feedback for that matter) it’s important to be open to the definition of the attributes identified, as what a phrase means to you may be completely different to customers.    Download Brand Map Explainer

There is a growing social science movement concerning the interpretation and use of signs and symbols within marketing called Semiotics .  As a brief introduction you might want to think of it as three main layers of brand meaning, starting from the outside and working in. Each layer infiltrates the ones inside it and can influence or be influenced by the others.

• Cultural Meaning : This is the broad context in which customers come to appreciate what a brand stands for and respond to it, either influencing or responding to popular culture, for example
• Community Meaning : This doesn’t just denote a local community, but any group of associated people: colleagues, family, people who support the same club or pursue the same hobbies and interests. Corporate culture can be a manifestation of this.
• Individual Meaning : This is probably far more motivating than the collective meaning and it drives the growth in personalisation. A few small differences can be notable enough for someone to choose the brand and pay a premium. That meaningful difference may be something so small or immaterial that even the person purchasing the brand doesn’t fully acknowledge it.

Why it’s important to focus on the relevant audience

It’s not just about what people are saying and thinking about the brand, but also who is saying it. Established, new, lost or potential customers, old or young will all have a different perspective.

Make sure you understand who your audience  is, or could be, both in terms of demographics and drivers when scoping brand analysis.

Brand research methods

There’s a variety of ways to measure the relationship between brand name and specific concepts. They fall into two main techniques: scaling and sorting:

• Customer surveys, which might include perception maps
• Customer SATisfaction surveys
• Net Promotor Scores (NPS)
• Product surveys
• Social media listening
• Website traffic
• Google analytics

How to do brand analysis

Although the customer holds the balance of power in terms of perception, brands can take steps to leverage brand perception more effectively. Here are six steps to follow when assessing, measuring and adapting brand perception:

• Identify the right project objectives and metrics for measuring brand perception in your target audience
• Understand internal brand perceptions within the organisation and how they may be translating externally
• Learn more about customers and the customer experience through tailored research
• Understand perceptions through each stage of the customer journey: awareness, trial, consideration, purchase, favourite, and loyalty
• Compare performance and brand perceptions in the competitive space to better position strategies
• Learn to adapt to changes in brand perception when they arise by frequently assessing brand performance and allocating marketing spend more effectively

And of course you could think truly long term and integrate marketing research, investment, market and financial metrics into a single insightful model to track performance over time and against competitors. Download Brand Map Explainer

In conclusion…

“We don’t see things as they are. We see them as we are.” – Anais Nin

Perception is reality.  Consumer purchasing decisions are significantly impacted by perceptions of brands and their competitors.  It’s no good sticking your head in the sand, or a finger in the air – strategic and well thought out analysis is required to ensure brands are on top of their game.

Undertaking brand analysis is a key tool in the armour of managing your brand positioning. You can be left behind quickly when you’re not part of the conversation.

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MKT-630 1-2 Short Paper Roles and Benefits of Marketing Research

• NOC:Marketing research and analysis (Video) 
• Co-ordinated by : IIT Roorkee
• Available from : 2017-06-08
• Intro Video
• Introduction to Marketing Research
• Defining Research Problem
• Developing Research Approach & Developing Research Design: Non- Conclusive
• Research Design: Conclusive
• Qualitative Research: Nature and Approaches
• Qualitative Research: Depth Interview, Focus Group Discussion
• Projective Technique, Case Study
• Case Study, Descriptive Research Design & Research Errors
• Primary & Secondary Data, Research Error
• Measurement & Scaling: Comparative & Non-comparative Scaling
• Scale Development Process
• Questionnaire & Form Design
• Causal Research & Types
• Experimental Design & Sampling
• Sampling Design & Procedure
• Sampling & Sample Size Determination
• Hypothesis Development: Null & Alternate, Type I & Type II Errors
• Data Preparation
• Hypothesis Testing: T-Test, Z-Test
• T, Z & F Test
• Hypothesis Testing: Anova & Manova
• Cross Tabulation & Chi Square Test
• Correlation & Regression
• Factor Analysis
• Factor Analysis.
• SEM & CFA-1
• SEM & CFA-2
• SEM & CFA-3
• Cluster Analysis- I
• Cluster Analysis- II
• Discriminant Analysis
• Discriminant Analysis-1
• Researching Rural Market
• International Marketing Research
• Ethics in Marketing Research
• Ethics in Marketing Research-1
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Marketing Research Notes, PDF, Syllabus I MBA, BBA, BCOM 2024

• Post last modified: 5 April 2022
• Reading time: 9 mins read
• Post category: MBA Study Material / BBA Study Material / BCOM Study Material

Download Marketing Research Notes , PDF, Books, Syllabus for MBA, BBA, BCOM 2024. We provide a complete marketing research pdf. Marketing Research study material includes marketing research notes, book, courses, case study, syllabus, question paper, MCQ, questions and answers and available in marketing research pdf form.

Marketing Research subject is included in MBA so students are able to download marketing research notes for MBA, BBA, BCOM 2nd year and marketing research notes for MBA, BBA, BCOM 4th semester.

Table of Content

• 1 Marketing Research Syllabus
• 2 Marketing Research Notes PDF
• 3 Marketing Research Notes
• 4 Marketing Research Questions and Answers
• 5 Marketing Research Question Paper
• 6 Marketing Research Books

Marketing Research Notes can be downloaded in marketing research pdf from the below article.

Marketing Research Syllabus

A detailed marketing research syllabus as prescribed by various Universities and colleges in India are as under. You can download the syllabus in marketing research pdf form.

Introduction to marketing Research – marketing research as a tool of Management – relevance of marketing research in the Indian Context.

Basic concepts – Scientific method – Types of Research – basic method of collection data – Secondary Data – The Marketing research process – planning the research project.

The data collection forms – attitude measurement.

Introduction to sampling – applications of sampling methods of marketing problems.

UNIT V Data collection and the field force – tabulation of collected data – analysis techniques – research report presentations.

Marketing Research Notes PDF

Marketing research notes.

Market research is defined as the process of evaluating the feasibility of a new product or service, through research conducted directly with potential consumers. This method allows organizations or businesses to discover their target market, collect and document opinions and make informed decisions.

Marketing Research Questions and Answers

If you have already studied the marketing research notes, then it’s time to move ahead and go through previous year marketing research question papers.

• What is primary data?
• What is secondary data?
• What are the classical methods of collecting primary data?
• Mention some important sources of economic data.
• Distinguish between primary and secondary data.
• Distinguish between cross section and time-series data.
• Distinguish between qualitative and quantitative data
• What is a sampling frame?
• What is a complete enumeration?
• Define sampling.
• Write a note on simple random sampling
• Write a note on stratified random sampling.
• Write a note on systematic sampling.
• Write a note on multi-stage sampling.
• Write a note on sequential sampling.

Marketing Research Question Paper

If you have already studied the marketing research notes, then it’s time to move ahead and go through previous year marketing research question paper.

It will help you to understand the question paper pattern and type of marketing research question and answer asked in MBA 2nd year marketing research exam. You can download the syllabus in marketing research pdf form.

Marketing Research Books

Below is the list of marketing research books recommended by the top university in India.

• Boyd, Harper W. Jr., Westfall, Ralph and Stasch, Stanley, Marketing Research: Text and Cases, Richard D. Irwin Inc., Homewood, Illinois.
• Green, P. E. and Tull, D. S., Research for Marketing Decisions, 5th edition, Prentice-Hall of India, New Delhi.
• Luck D. J., Wales, H.G., Taylor, D. A. and Rubin R. S., Marketing Research, 7th Edition, Prentice-Hall of India, New Delhi.
• Tull, D. S. and Hawkins D. I., Marketing Research : Measurement and Method, 6th Edition, Prentice-Hall of India, New Delhi.

In the above article, a student can download marketing research notes for MBA, BBA, BCOM 2nd year and marketing research notes for MBA, BBA, BCOM 4th semester. Marketing Research study material includes marketing research notes, marketing research books, marketing research syllabus, marketing research question paper, marketing research case study, marketing research questions and answers, marketing research courses in marketing research pdf form.

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What Is Market Segmentation?

• How It Works
• Determining Your Market Segment
• Limitations
• Market Segmentation FAQs

The Bottom Line

• Marketing Essentials

Market Segmentation: Definition, Example, Types, Benefits

Yarilet Perez is an experienced multimedia journalist and fact-checker with a Master of Science in Journalism. She has worked in multiple cities covering breaking news, politics, education, and more. Her expertise is in personal finance and investing, and real estate.

Market segmentation is a way of aggregating prospective buyers into groups or segments, based on demographics, geography, behavior, or psychographic factors in order to better understand and market to them.

Key Takeaways

• Market segmentation seeks to identify targeted groups of consumers to tailor products and branding in a way that is attractive to the group.
• Markets can be segmented in several ways such as geographically, demographically, or behaviorally.
• Market segmentation helps companies minimize risk by figuring out which products are the most likely to earn a share of a target market and the best ways to market and deliver those products to the market.
• With risk minimized and clarity about the marketing and delivery of a product heightened, a company can then focus its resources on efforts likely to be the most profitable.
• Market segmentation can also increase a company's demographic reach and may help the company discover products or services they hadn't previously considered.

Investopedia / Matthew Collins

Understanding Market Segmentation

Companies can generally use three criteria to identify different market segments:

• Homogeneity , or common needs within a segment
• Distinction , or being unique from other groups
• Reaction , or a similar response to the market

For example, an athletic footwear company might have market segments for basketball players and long-distance runners. As distinct groups, basketball players and long-distance runners respond to very different advertisements. Understanding these different market segments enables the athletic footwear company to market its branding appropriately.

Market segmentation is an extension of market research that seeks to identify targeted groups of consumers to tailor products and branding in a way that is attractive to the group. The objective of market segmentation is to minimize risk by determining which products have the best chances of gaining a share of a target market  and determining the best way to deliver the products to the market. This allows the company to increase its overall efficiency by focusing limited resources on efforts that produce the best return on investment (ROI).

Market segmentation allows a company to increase its overall efficiency by focusing limited resources on efforts that produce the best return on investment (ROI).

Types of Market Segmentation

There are four primary types of market segmentation. However, one type can usually be split into an individual segment and an organization segment. Therefore, below are five common types of market segmentation.

Demographic Segmentation

Demographic segmentation is one of the simple, common methods of market segmentation. It involves breaking the market into customer demographics as age, income, gender, race, education, or occupation. This market segmentation strategy assumes that individuals with similar demographics will have similar needs.

Example: The market segmentation strategy for a new video game console may reveal that most users are young males with disposable income.

Firmographic Segmentation

Firmographic segmentation is the same concept as demographic segmentation. However, instead of analyzing individuals, this strategy looks at organizations and looks at a company's number of employees, number of customers, number of offices, or annual revenue .

Example: A corporate software provider may approach a multinational firm with a more diverse, customizable suite while approaching smaller companies with a fixed fee, more simple product.

Geographic Segmentation

Geographic segmentation is technically a subset of demographic segmentation. This approach groups customers by physical location, assuming that people within a given geographical area may have similar needs. This strategy is more useful for larger companies seeking to expand into different branches, offices, or locations.

Example: A clothing retailer may display more raingear in their Pacific Northwest locations compared to their Southwest locations.

Behavioral Segmentation

Behavioral segmentation relies heavily on market data, consumer actions, and decision-making patterns of customers. This approach groups consumers based on how they have previously interacted with markets and products. This approach assumes that consumers prior spending habits are an indicator of what they may buy in the future, though spending habits may change over time or in response to global events.

Example: Millennial consumers traditionally buy more craft beer, while older generations are traditionally more likely to buy national brands.

Psychographic Segmentation

Often the most difficult market segmentation approach, psychographic segmentation strives to classify consumers based on their lifestyle, personality, opinions, and interests. This may be more difficult to achieve, as these traits (1) may change easily and (2) may not have readily available objective data. However, this approach may yield strongest market segment results as it groups individuals based on intrinsic motivators as opposed to external data points.

Example: A fitness apparel company may target individuals based on their interest in playing or watching a variety of sports.

Other less notable examples of types of segmentation include volume (i.e. how much a consumer spends), use-related (i.e. how loyal a customer is), or other customer traits (i.e. how innovative or risk-favorable a customer is).

How to Determine Your Market Segment

There's no single universally accepted way to perform market segmentation. To determine your market segments, it's common for companies to ask themselves the following questions along their market segmentation journey.

Phase I: Setting Expectations/Objectives

• What is the purpose or goal of performing market segmentation?
• What does the company hope to find out by performing marketing segmentation?
• Does the company have any expectations on what market segments may exist?

Phase 2: Identify Customer Segments

• What segments are the company's competitors selling to?
• What publicly available information (i.e. U.S. Census Bureau data) is relevant and available to our market?
• What data do we want to collect, and how can we collect it?
• Which of the five types of market segments do we want to segment by?

Phase 3: Evaluate Potential Segments

• What risks are there that our data is not representative of the true market segments?
• Why should we choose to cater to one type of customer over another?
• What is the long-term repercussion of choosing one market segment over another?
• What is the company's ideal customer profile, and which segments best overlap with this "perfect customer"?

Phase 4: Develop Segment Strategy

• How can the company test its assumptions on a sample test market?
• What defines a successful marketing segment strategy?
• How can the company measure whether the strategy is working?

Phase 5: Launch and Monitor

• Who are key stakeholders that can provide feedback after the market segmentation strategy has been unveiled?
• What barriers to execution exist, and how can they can be overcome?
• How should the launch of the marketing campaign be communicated internally?

Benefits of Market Segmentation

Marketing segmentation takes effort and resources to implement. However, successful marketing segmentation campaigns can increase the long-term profitability and health of a company. Several benefits of market segmentation include;

• Increased resource efficiency. Marketing segmentation allows management to focus on certain demographics or customers. Instead of trying to promote products to the entire market, marketing segmentation allows a focused, precise approach that often costs less compared to a broad reach approach.
• Stronger brand image. Marketing segment forces management to consider how it wants to be perceived by a specific group of people. Once the market segment is identified, management must then consider what message to craft. Because this message is directed at a target audience, a company's branding and messaging is more likely to be very intentional. This may also have an indirect effect of causing better customer experiences with the company.
• Greater potential for brand loyalty. Marketing segmentation increases the opportunity for consumers to build long-term relationships with a company. More direct, personal marketing approaches may resonate with customers and foster a sense of inclusion, community, and a sense of belonging. In addition, market segmentation increases the probability that you land the right client that fits your product line and demographic.
• Stronger market differentiation. Market segmentation gives a company the opportunity to pinpoint the exact message they way to convey to the market and to competitors. This can also help create product differentiation by communicating specifically how a company is different from its competitors. Instead of a broad approach to marketing, management crafts a specific image that is more likely to be memorable and specific.
• Better targeted digital advertising. Marketing segmentation enables a company to perform better targeted advertising strategies. This includes marketing plans that direct effort towards specific ages, locations, or habits via social media.

Market segmentation exists outside of business. There has been extensive research using market segmentation strategies to promote overcoming COVID-19 vaccination hesitancy and other health initiatives.

Limitations of Market Segmentation

The benefits above can't be achieved with some potential downsides. Here are some disadvantages to consider when considering implementing market segmentation strategies.

• Higher upfront marketing expenses. Marketing segmentation has the long-term goal of being efficient. However, to capture this efficiency, companies must often spend resources upfront to gain the insight, data, and research into their customer base and the broad markets.
• Increased product line complexity. Marketing segmentation takes a large market and attempts to break it into more specific, manageable pieces. This has the downside risk of creating an overly complex, fractionalized product line that focuses too deeply on catering to specific market segments. Instead of a company having a cohesive product line, a company's marketing mix may become too confusing and inconsistently communicate its overall brand.
• Greater risk of misassumptions. Market segmentation is rooted in the assumption that similar demographics will share common needs. This may not always be the case. By grouping a population together with the belief that they share common traits, a company may risk misidentifying the needs, values, or motivations within individuals of a given population.
• Higher reliance on reliable data. Market segmentation is only as strong as the underlying data that support the claims that are made. This means being mindful of what sources are used to pull in data. This also means being conscious of changing trends and when market segments may have shifted from prior studies.

Examples of Market Segmentation

Market segmentation is evident in the products, marketing, and advertising that people use every day. Auto manufacturers thrive on their ability to identify market segments correctly and create products and advertising campaigns that appeal to those segments.

Cereal producers market actively to three or four market segments at a time, pushing traditional brands that appeal to older consumers and healthy brands to health-conscious consumers, while building brand loyalty among the youngest consumers by tying their products to, say, popular children's movie themes.

A sports-shoe manufacturer might define several market segments that include elite athletes, frequent gym-goers, fashion-conscious women, and middle-aged men who want quality and comfort in their shoes. In all cases, the manufacturer's marketing intelligence about each segment enables it to develop and advertise products with a high appeal more efficiently than trying to appeal to the broader masses.

Market segmentation is a marketing strategy in which select groups of consumers are identified so that certain products or product lines can be presented to them in a way that appeals to their interests.

Why Is Market Segmentation Important?

Market segmentation realizes that not all customers have the same interests, purchasing power, or consumer needs. Instead of catering to all prospective clients broadly, market segmentation is important because it strives to make a company's marketing endeavors more strategic and refined. By developing specific plans for specific products with target audiences in mind, a company can increase its chances of generating sales and being more efficient with resources.

What Are the Types of Market Segmentation?

Types of segmentation include homogeneity, which looks at a segment's common needs, distinction, which looks at how the particular group stands apart from others, and reaction, or how certain groups respond to the market.

What Are Some Market Segmentation Strategies?

Strategies include targeting a group by location, by demographics—such as age or gender—by social class or lifestyle, or behaviorally—such as by use or response.

What Is an Example of Market Segmentation?

Upon analysis of its target audience and desired brand image, Crypto.com entered into an agreement with Matt Damon to promote their platform and cryptocurrency investing. With backdrops of space exploration and historical feats of innovation, Crypto.com's market segmentation targeted younger, bolder, more risk-accepting individuals.

Market segmentation is a process companies use to break their potential customers into different sections. This allows the company to allocate the appropriate resource to each individual segment which allows for more accurate targeting across a variety of marketing campaigns.

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Provides entrepreneurs with an understanding of how to use market research and market information to test the validity of a business concept and to refine a business plan. Introduces the key…

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Provides entrepreneurs with an understanding of how to use market research and market information to test the validity of a business concept and to refine a business plan. Introduces the key questions entrepreneurs should consider, the techniques entrepreneurs could use to gather information to address those questions, and the practical considerations for collecting and interpreting data.

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What the data says about crime in the U.S.

A growing share of Americans say reducing crime should be a top priority for the president and Congress to address this year. Around six-in-ten U.S. adults (58%) hold that view today, up from 47% at the beginning of Joe Biden’s presidency in 2021.

We conducted this analysis to learn more about U.S. crime patterns and how those patterns have changed over time.

The analysis relies on statistics published by the FBI, which we accessed through the Crime Data Explorer , and the Bureau of Justice Statistics (BJS), which we accessed through the  National Crime Victimization Survey data analysis tool .

To measure public attitudes about crime in the U.S., we relied on survey data from Pew Research Center and Gallup.

Additional details about each data source, including survey methodologies, are available by following the links in the text of this analysis.

With the issue likely to come up in this year’s presidential election, here’s what we know about crime in the United States, based on the latest available data from the federal government and other sources.

How much crime is there in the U.S.?

It’s difficult to say for certain. The  two primary sources of government crime statistics  – the Federal Bureau of Investigation (FBI) and the Bureau of Justice Statistics (BJS) – paint an incomplete picture.

The FBI publishes  annual data  on crimes that have been reported to law enforcement, but not crimes that haven’t been reported. Historically, the FBI has also only published statistics about a handful of specific violent and property crimes, but not many other types of crime, such as drug crime. And while the FBI’s data is based on information from thousands of federal, state, county, city and other police departments, not all law enforcement agencies participate every year. In 2022, the most recent full year with available statistics, the FBI received data from 83% of participating agencies .

BJS, for its part, tracks crime by fielding a  large annual survey of Americans ages 12 and older and asking them whether they were the victim of certain types of crime in the past six months. One advantage of this approach is that it captures both reported and unreported crimes. But the BJS survey has limitations of its own. Like the FBI, it focuses mainly on a handful of violent and property crimes. And since the BJS data is based on after-the-fact interviews with crime victims, it cannot provide information about one especially high-profile type of offense: murder.

All those caveats aside, looking at the FBI and BJS statistics side-by-side  does  give researchers a good picture of U.S. violent and property crime rates and how they have changed over time. In addition, the FBI is transitioning to a new data collection system – known as the National Incident-Based Reporting System – that eventually will provide national information on a much larger set of crimes , as well as details such as the time and place they occur and the types of weapons involved, if applicable.

Which kinds of crime are most and least common?

Property crime in the U.S. is much more common than violent crime. In 2022, the FBI reported a total of 1,954.4 property crimes per 100,000 people, compared with 380.7 violent crimes per 100,000 people.  

By far the most common form of property crime in 2022 was larceny/theft, followed by motor vehicle theft and burglary. Among violent crimes, aggravated assault was the most common offense, followed by robbery, rape, and murder/nonnegligent manslaughter.

BJS tracks a slightly different set of offenses from the FBI, but it finds the same overall patterns, with theft the most common form of property crime in 2022 and assault the most common form of violent crime.

How have crime rates in the U.S. changed over time?

Both the FBI and BJS data show dramatic declines in U.S. violent and property crime rates since the early 1990s, when crime spiked across much of the nation.

Using the FBI data, the violent crime rate fell 49% between 1993 and 2022, with large decreases in the rates of robbery (-74%), aggravated assault (-39%) and murder/nonnegligent manslaughter (-34%). It’s not possible to calculate the change in the rape rate during this period because the FBI  revised its definition of the offense in 2013 .

The FBI data also shows a 59% reduction in the U.S. property crime rate between 1993 and 2022, with big declines in the rates of burglary (-75%), larceny/theft (-54%) and motor vehicle theft (-53%).

Using the BJS statistics, the declines in the violent and property crime rates are even steeper than those captured in the FBI data. Per BJS, the U.S. violent and property crime rates each fell 71% between 1993 and 2022.

While crime rates have fallen sharply over the long term, the decline hasn’t always been steady. There have been notable increases in certain kinds of crime in some years, including recently.

In 2020, for example, the U.S. murder rate saw its largest single-year increase on record – and by 2022, it remained considerably higher than before the coronavirus pandemic. Preliminary data for 2023, however, suggests that the murder rate fell substantially last year .

How do Americans perceive crime in their country?

Americans tend to believe crime is up, even when official data shows it is down.

In 23 of 27 Gallup surveys conducted since 1993 , at least 60% of U.S. adults have said there is more crime nationally than there was the year before, despite the downward trend in crime rates during most of that period.

While perceptions of rising crime at the national level are common, fewer Americans believe crime is up in their own communities. In every Gallup crime survey since the 1990s, Americans have been much less likely to say crime is up in their area than to say the same about crime nationally.

Public attitudes about crime differ widely by Americans’ party affiliation, race and ethnicity, and other factors . For example, Republicans and Republican-leaning independents are much more likely than Democrats and Democratic leaners to say reducing crime should be a top priority for the president and Congress this year (68% vs. 47%), according to a recent Pew Research Center survey.

How does crime in the U.S. differ by demographic characteristics?

Some groups of Americans are more likely than others to be victims of crime. In the  2022 BJS survey , for example, younger people and those with lower incomes were far more likely to report being the victim of a violent crime than older and higher-income people.

There were no major differences in violent crime victimization rates between male and female respondents or between those who identified as White, Black or Hispanic. But the victimization rate among Asian Americans (a category that includes Native Hawaiians and other Pacific Islanders) was substantially lower than among other racial and ethnic groups.

The same BJS survey asks victims about the demographic characteristics of the offenders in the incidents they experienced.

In 2022, those who are male, younger people and those who are Black accounted for considerably larger shares of perceived offenders in violent incidents than their respective shares of the U.S. population. Men, for instance, accounted for 79% of perceived offenders in violent incidents, compared with 49% of the nation’s 12-and-older population that year. Black Americans accounted for 25% of perceived offenders in violent incidents, about twice their share of the 12-and-older population (12%).

As with all surveys, however, there are several potential sources of error, including the possibility that crime victims’ perceptions about offenders are incorrect.

How does crime in the U.S. differ geographically?

There are big geographic differences in violent and property crime rates.

For example, in 2022, there were more than 700 violent crimes per 100,000 residents in New Mexico and Alaska. That compares with fewer than 200 per 100,000 people in Rhode Island, Connecticut, New Hampshire and Maine, according to the FBI.

The FBI notes that various factors might influence an area’s crime rate, including its population density and economic conditions.

What percentage of crimes are reported to police? What percentage are solved?

Most violent and property crimes in the U.S. are not reported to police, and most of the crimes that  are  reported are not solved.

In its annual survey, BJS asks crime victims whether they reported their crime to police. It found that in 2022, only 41.5% of violent crimes and 31.8% of household property crimes were reported to authorities. BJS notes that there are many reasons why crime might not be reported, including fear of reprisal or of “getting the offender in trouble,” a feeling that police “would not or could not do anything to help,” or a belief that the crime is “a personal issue or too trivial to report.”

Most of the crimes that are reported to police, meanwhile,  are not solved , at least based on an FBI measure known as the clearance rate . That’s the share of cases each year that are closed, or “cleared,” through the arrest, charging and referral of a suspect for prosecution, or due to “exceptional” circumstances such as the death of a suspect or a victim’s refusal to cooperate with a prosecution. In 2022, police nationwide cleared 36.7% of violent crimes that were reported to them and 12.1% of the property crimes that came to their attention.

Which crimes are most likely to be reported to police? Which are most likely to be solved?

Around eight-in-ten motor vehicle thefts (80.9%) were reported to police in 2022, making them by far the most commonly reported property crime tracked by BJS. Household burglaries and trespassing offenses were reported to police at much lower rates (44.9% and 41.2%, respectively), while personal theft/larceny and other types of theft were only reported around a quarter of the time.

Among violent crimes – excluding homicide, which BJS doesn’t track – robbery was the most likely to be reported to law enforcement in 2022 (64.0%). It was followed by aggravated assault (49.9%), simple assault (36.8%) and rape/sexual assault (21.4%).

The list of crimes  cleared  by police in 2022 looks different from the list of crimes reported. Law enforcement officers were generally much more likely to solve violent crimes than property crimes, according to the FBI.

The most frequently solved violent crime tends to be homicide. Police cleared around half of murders and nonnegligent manslaughters (52.3%) in 2022. The clearance rates were lower for aggravated assault (41.4%), rape (26.1%) and robbery (23.2%).

When it comes to property crime, law enforcement agencies cleared 13.0% of burglaries, 12.4% of larcenies/thefts and 9.3% of motor vehicle thefts in 2022.

Are police solving more or fewer crimes than they used to?

Nationwide clearance rates for both violent and property crime are at their lowest levels since at least 1993, the FBI data shows.

Police cleared a little over a third (36.7%) of the violent crimes that came to their attention in 2022, down from nearly half (48.1%) as recently as 2013. During the same period, there were decreases for each of the four types of violent crime the FBI tracks:

• Police cleared 52.3% of reported murders and nonnegligent homicides in 2022, down from 64.1% in 2013.
• They cleared 41.4% of aggravated assaults, down from 57.7%.
• They cleared 26.1% of rapes, down from 40.6%.
• They cleared 23.2% of robberies, down from 29.4%.

The pattern is less pronounced for property crime. Overall, law enforcement agencies cleared 12.1% of reported property crimes in 2022, down from 19.7% in 2013. The clearance rate for burglary didn’t change much, but it fell for larceny/theft (to 12.4% in 2022 from 22.4% in 2013) and motor vehicle theft (to 9.3% from 14.2%).

Note: This is an update of a post originally published on Nov. 20, 2020.

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John Gramlich is an associate director at Pew Research Center

8 facts about Black Lives Matter

#blacklivesmatter turns 10, support for the black lives matter movement has dropped considerably from its peak in 2020, fewer than 1% of federal criminal defendants were acquitted in 2022, before release of video showing tyre nichols’ beating, public views of police conduct had improved modestly, most popular.

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Emerson Electric (EMR) Ascends But Remains Behind Market: Some Facts to Note

The most recent trading session ended with Emerson Electric ( EMR Quick Quote EMR - Free Report ) standing at $109.89, reflecting a +0.26% shift from the previouse trading day's closing. This move lagged the S&P 500's daily gain of 1.02%. On the other hand, the Dow registered a gain of 0.4%, and the technology-centric Nasdaq increased by 2.03%.

Shares of the maker of process controls systems, valves and analytical instruments have depreciated by 3.37% over the course of the past month, underperforming the Industrial Products sector's loss of 3.17% and the S&P 500's loss of 3.15%.

The investment community will be closely monitoring the performance of Emerson Electric in its forthcoming earnings report. The company is scheduled to release its earnings on May 8, 2024. The company is expected to report EPS of $1.26, up 15.6% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $4.29 billion, up 14.2% from the prior-year quarter.

For the full year, the Zacks Consensus Estimates project earnings of $5.40 per share and a revenue of $17.55 billion, demonstrating changes of +21.62% and +15.73%, respectively, from the preceding year.

Investors might also notice recent changes to analyst estimates for Emerson Electric. These latest adjustments often mirror the shifting dynamics of short-term business patterns. Consequently, upward revisions in estimates express analysts' positivity towards the company's business operations and its ability to generate profits.

Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.

The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 0.05% upward. Right now, Emerson Electric possesses a Zacks Rank of #3 (Hold).

Valuation is also important, so investors should note that Emerson Electric has a Forward P/E ratio of 20.29 right now. This denotes a discount relative to the industry's average Forward P/E of 20.83.

It is also worth noting that EMR currently has a PEG ratio of 1.9. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. Manufacturing - Electronics stocks are, on average, holding a PEG ratio of 1.98 based on yesterday's closing prices.

The Manufacturing - Electronics industry is part of the Industrial Products sector. This industry, currently bearing a Zacks Industry Rank of 152, finds itself in the bottom 40% echelons of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.

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San Francisco Retail Market Report | Spring 2024

How is the City's retail market faring 4 years post-pandemic?

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