Ch5 Marketing Research and Market Demand and Forecasting
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Transcript of Ch5 Marketing Research and Market Demand and Forecasting
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Toward Marketing Planning:Marketing Research and Forecasting Demand
Chapter 3&4
Ch.3, p.108-113
Ch.4, p. 119-121; 136-138
Lecture 3 , Part 1
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Marketing Research: Tasks
1. To capture the marketing insights, provide diagnostic informationabout the marketplace.( pages 119-121).
2. to support The Marketing Plan Development
Analyzing the macro/microenvironment Forecasting and demand Measurement
Measuring Marketing Productivity.
3. To assess the efficiency and effectiveness of marketing activities :marketing metrics , marketingmix modeling and developingmarketing dashboards ( pages 136-138).
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Marketing Research Defined:
The systematic design, collection, analysis,
and reporting of data and findings relevant to
a specific marketing situation facing thecompany.
Budgeted at 1-2% of company sales In-house/ or subcontracted
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The Marketing Research Process: 11 Steps
Step One: Establishing the Need for MarketingResearch
Step Two: Defining the Problem Step Three: Establishing Research Objectives
Step Four: Determining Research Design
Step Five: Identifying Information Types and
Sources Step Six: Determining Methods of Accessing
Data
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The Marketing Research Process: 11 Steps
cont
Step Seven: Designing Data Collection Forms
Step Eight: Determining Sample Plan and Size Step Nine: Collecting Data
Step Ten: Analyzing Data
Step Eleven: Preparing and Presenting the Final
Research Report/ Recommendation
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The Marketing Research ProcessStep One: Establish the Need for Marketing Research
When Marketing Research is not needed
The information is already available Decisions need to be made now
We cant afford research
Costs outweigh the value of the research
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The Marketing Research ProcessStep Two: Define the Problem
The most important step in the marketingresearch process is defining the problem.
Not to be broad or narrow
Mkt Manger and the researcher agree on the
problem.
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The Marketing Research ProcessStep Three: Establish Research Objectives
What information is needed in order to solve theproblem?
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The Marketing Research ProcessStep Four: Determine Research Design/Plan
We need to make decisions about:
1.Research approaches: observational,ethnographic, focus group, survey,behavioral data (scanner, database), orexperimental (treatments).
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The Marketing Research ProcessStep Five: Identify Information Types and Sources
Secondary Data:information that has
been collected for some other purposeother than the research at hand.
Primary Data:information that has beengathered specifically for the research
objectives at hand.
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The Marketing Research ProcessStep Six: Determine Methods of Accessing Data
Secondary Data:accessing data through
sources such as governmental sources ,the Internet and library, syndicated bodies.
Primary Data:collecting data throughmethods such as telephone, mail, online,
and face-to-face (quantitative) andobservation studies and focus groups(qualitative).
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The Marketing Research ProcessStep Seven: Design Data Collection Forms
The design of the data collection form that isused to ask and record information in marketing
research projects is critical to the success of theproject. It is easy to write a set of questions butvery difficult to construct a questionnaire.
Questionnaires ( Scaled questionnaires)
Qualitative studies ( unstructured ) Technological Devices
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Instruments of collecting data: Scaledquestionnaires, non structured or qualitativemeasures ,technological devices .
galvanic skin response
pupil dilation
eye tracing/Brain waves
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The Marketing Research ProcessStep Eight: Determine Sample Plan and Size
Sample plan:refers to the process used to selectunits from the population to be included in the
sample Sample size:refers to determining how many
elements of the population should be included inthe sample
Contact method:Mail, Telephone, in person, oronline.
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The Marketing Research ProcessStep Nine: Collect Data
Data collection is very important because,
regardless of the data analysis methods used,data analysis cannot fix bad data. 12
Nonsampling errors may occur during data
collection. These are related to poor designand/or execution of the data gathering.
Sampling errors may occur based purely onchance
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The Marketing Research ProcessStep Ten: Analyze Data
Data analysis:involves entering data intocomputer files, inspecting data for errors, and
running tabulations and various statistical tests
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The Marketing Research ProcessStep Eleven: Prepare and Present the Final
Research Report/ and Make the decision
The last step is one of the most important phasesof marketing research.
Its importance cannot be overstated because it isthe report, or its presentation, that properlycommunicates the results to the client.
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References
ChapterFile Format: Microsoft Powerpoint 97 - View as HTML2. The Marketing. Research Process. The MarketingResearchProcess: 11 Steps. StepOne: Establishing the Need for MarketingResearch. ... The
MarketingResearch Process. ...homepages.wmich.edu/~lindquis/marketing%20research%20ppt/bbch2.ppt.ppt - Similar pages
Date : 12th, January 2004
http://homepages.wmich.edu/~lindquis/marketing%20research%20ppt/bbch2.ppt.ppthttp://66.102.7.104/search?q=cache:9dHb8AOudaIJ:homepages.wmich.edu/~lindquis/marketing%2520research%2520ppt/bbch2.ppt.ppt++%22marketing+research+%22+filetype:ppt&hl=en&lr=lang_en&ie=UTF-8http://www.google.com/search?hl=en&lr=lang_en&ie=UTF-8&oe=UTF-8&as_qdr=all&q=related:homepages.wmich.edu/~lindquis/marketing%2520research%2520ppt/bbch2.ppt.ppthttp://www.google.com/search?hl=en&lr=lang_en&ie=UTF-8&oe=UTF-8&as_qdr=all&q=related:homepages.wmich.edu/~lindquis/marketing%2520research%2520ppt/bbch2.ppt.ppthttp://66.102.7.104/search?q=cache:9dHb8AOudaIJ:homepages.wmich.edu/~lindquis/marketing%2520research%2520ppt/bbch2.ppt.ppt++%22marketing+research+%22+filetype:ppt&hl=en&lr=lang_en&ie=UTF-8http://homepages.wmich.edu/~lindquis/marketing%20research%20ppt/bbch2.ppt.ppt -
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Measuring Marketing ProductivityPages136-138
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Marketing Metrics
A set of measures relative to marketingperformance.
Example of the matrix for a website:
1- Visitor number( measure exposure),2-Number of visits by individuals suggest loyalty ),
3-How deep into the site visitors go
4-How long visitors stay on the site,
5-Subscription numbers (express commitment tothe site)
6- promotions acted one.g. discount coupons
downloaded.
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Online sales matrix
1- sales volumeincome measure
2- Sales trend time of day/week/ month/year/
geographic
3- Average order size (bigger order values suggestcustomer satisfaction).
4- conversion rate ( sales per site visits) .
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Developing a Marketing Dashboards(Scorecard).
A system of identified objectives, target andindexes.
To monitor the marketing performance while
setting control.
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Forecasting and Demand Measurement
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Topics on this part:
Market Demand
Company Demand
Method of measuring Demand
Forecasting demand
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Why measuring and forecasting demand
Identifying market opportunities .
Measuring market size, growth and profitpotential of each market opportunity.
Selection of an opportunity that match theorganization resources or mission.
Sales forecast support allocating the resources
for purchasing, operation and marketing, forinstance.
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Market Demand Defined
"A market demand is the total volume of a product that
consumer would buy in a defined target segment ,
defined time, defined area, defined marketenvironment, and defined marketing program".
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Which market to measure? VocabulariesCase study: Motor Cycle Market
.
Market PotentialActual + Prospects
Available Market
Qualified Market Serviced Market(TMs)
PenetratedMarket
have Interest, Income and Access
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Market Potential
.
Mkt min
Mkt forecast
Mkt potential
Industry Marketing Expenditure
Market potential is the limit approached by market demand asindustry marketing expenditure approach infinity for a givenmarketing environment.
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Measuring Marketing Share ( Company demand)
Company demand is a function of the companymarketing effort under assumed marketingenvironment.
Company use this forecast for preparing amarketing plan and establishing the salesquotas and sales budget.
Absolute : measured as percentage of its salesexpressed as a percentage of total industrysales in unite sales or dollar sales) or relative.
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Methods of measuring demand
1-Total market Potential Measurement
Total market potential is the maximum amount ofsales that might be available to all the firms in an
industry during a given period ,under a givenlevel of industry marketing effort andenvironmental conditions.
Q= nqp
Q( Total Market Potential)
N( number of buyers)
Q( quantity purchase by average buyer)
P( price)
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Methods of measuring Company demand( Company Sales
Forecast)
Chain Ratio method ( Multiplicative Model)
It involves multiplying a base number by severaladjusting percentages .
Example :
Total estimated prospective buyers 1 million( Base Number)
Target market(25% of total buyers) x25%
Distribution /communication coverage
(.75% of target market ) x.75 Annual purchase rate (20unites per year) x20
Average offering unite price ($10) x $10
Demand ( or sales) measured $37.5 Millions
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Area Market Potential( cities, states,nations)
1- Marketbuildup Method (To measure areasales potential)
Calls for identifying all the potential buyers in eachmarket and estimating their potential purchases(e.g. wood lathes in an area).
2- Multiple Factor index Method
Used in consumer market .
% of population in area; % of disposable income;% of retail sales are weighted
[0.5(2.5)+0.3(2)+0.2(1.7)]= 2.19 % of the nation
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Estimating Future Demand (Forecasting)
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Qualitative Techniques :
1. Survey of buyers intentions undertaken by marketing researches.
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2. Composite of sales force opinion as they have better
insight on trends in the market.
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3. Expert opinion ( from dealers, distributors, suppliers,
marketing consultants ( Delphi method).
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A) Time Series analysis/ Past Sales Analysis
QuantitativeTechniques
Usage
-Existing of data for a long period provided stability and exclusion of drastic factors
-More convenient for short term forecast
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B) Market testing Method
Usage :
When buyers do not plan their purchases carefully. When experts are not available or reliable
To forecast new product sales in a new distributionchannel or territory.
The new Fried Bologna Biscuit by Hardees
E d