MARKETING RESRACH AND CONSUMER BUYER BEHAVIOUR
WHAT IS MARKETING RESEARCH? Marketing Research is ‘The systematic gathering, recording, and analysing of data about problems relating to the marketing of goods and services’ (The American Marketing Association)
MARKETING RESEARCH SECONDARY DATA PRIMARY DATA MARKETING RESEARCH INFORMATION IS COMPOSED OF “PRIMARY DATA’ AND ‘SECONDARY DATA’
SECONDARY DATA Secondary data refers to "Off the shelf' information which already exists and which was collected for some other specific purpose. The collection of secondary data is often referred as ‘desk research ’.
SOURCES OF SECONDARY DATA a) Internal Sources of Secondary Data: • Accounting records • Sales force reports • Internal Data bases and records • Reports from previous marketing research studies • Budgets • Profit and loss statements b) External Sources of Secondary Data: • Computerized databases • Trade publications • Market research reports • Journals • Government data/statistics • Central bank • Websites, social media feeds and blogs • Other publishing sources
ADVANTAGES OF SECONDARY DATA There are several advantages of getting secondary data in comparison to collecting primary data. They are: • Relatively cheaper to gather secondary data since it is already available. • Relatively quicker to extract • One would not require too much of an expertise in extracting secondary data • In many situations multiple sources are available to collect and to verify it. • It provides historic or comparative data
PROBLEMS ENCOUNTERED WITH SECONDARY DATA • Relevance – it is not related to the research problem • Sufficiency - At times secondary data may be available, relevant and accurate, but still may not be sufficient to meet the data requirements for the problem being researched. • Validity - The collected information may be out dated and will therefore be redundant.
PRIMARY DATA Primary Data is data collected for the first time for the specific purposes of the particular marketing research study being conducted. The collection of primary data is often referred as ‘ field research ’ . Primary data is generally collected after a thorough analysis of secondary research, when information collected from the latter is insufficient for marketing decision making.
SOURCES OF PRIMARY DATA Observational Experimentation Survey Research – Mail, email, telephone, personal Depth Interviews/Focus groups
ADVANTAGES IN COLLECTING PRIMARY DATA There are several advantages in collecting primary data. They are as follows: • Relevance: A marketer could collect data, which is relevant and specific to the information requirement. • Sufficient : Sufficient amount of information could be collected.
DISADVANTAGES IN COLLECTING PRIMARY DATA • Time Consuming • Cost • Expertise
QUANTITAIVE & QULATITATIVE RESEARCH QUALITATIVE RESEARCH The collection of data that are open to interpretation, for instance on attitudes, value judgments, motivations and subjective opinions that might not be able to validate statistically. (depth interviews, focus group, observation) As the term implies, qualitative marketing research involves the collection of data (qualitative data) which is difficult or impossible to quantify. (Questions in terms of “why”) . The results of qualitative research are descriptive.
QUANTITATIVE RESEARCH The collection of quantified data, for example sales figures, demographic data, purchase frequency, etc, that can be subjected to statistical analysis and can be expressed numerically. (Quantitative data collection methods include various forms of surveys – online surveys, face-to-face interviews, telephone interviews, Quantitative research, on the other hand, involves the collection of data (quantitative data) which can be measured. (Questions in terms of “How many”) . Findings may be expressed numerically.
CONSUMER BUYER BEHAVIOUR
CONSUMER BUYING BEHAVIOUR Consumer Market All the individuals and households who buy or acquire goods and services for personal consumption. (Philip Kotler) Consumer Buying Behaviour The buying behavior of final consumers – individuals and households who buy goods and service for personal or household consumption . (Philip Kotler) Buying behaviour is the decision process and actions of people involved in buying and using products. (Michael J Baker)
CONSUMER NEEDS A human need is a state of felt deprivation of some basic satisfaction. People require food, clothing, shelter, safety, belongingness, esteem, and a few other things for survival. These needs are not created by society or by marketers; they are part of the human makeup. (marketers could trigger a need)
CONSUMER NEEDS, WANTS AND DEMAND Desired state Need Current state The degree of difference between the two states is what determines the level of motivation the person feels to do something about the problem.
CONSUMER WANTS Wants are specific items or objects that might satisfy the need. It is a means of expressing a need. A need may be satisfied by any one of a large number of alternatives. The availability of alternatives means of satisfying a need constitutes choice. For example, Mr. Perera is hungry and needs food. Thus, to satisfy his hunger, Mr. Perera could order pizza, burger, rice and curry, fried rice, noodles etc. Mr. Perera decides to order a rice and curry to satisfy his hunger. In this instance the rice and curry was an expression or the means of satisfying the need for hunger.
DEMAND Demands are wants for specific products backed by an ability to buy (purchasing power). Many people want a Mercedes; only a very few are able to buy one. Organisations must measure not only how many people want their products, but also how many would actually able to buy it. Thus, the demand for a given product is therefore a function of need, want and the ability to buy.
KEY STAGES OF CONSUMER BUYING DECISION PROCESS
NEED/PROBLEM RECOGNITION For the decision process to begin, a potential consumer/buyer must first recognize a problem or need. The problem or need can be triggered by: INTERNAL STIMULI or drive: A person’s normal needs – hunger, thirst - rises to a level high enough to become a drive. EXTERNAL STIMULI or drive: A person passes a bakery and sees freshly baked bread that stimulates his hunger; he watches a television advertisement for a vacation in Singapore or he admires a friend’s new smartphone. Marketers need to identify the circumstances that trigger a particular need. By gathering information marketers can identify the most frequent stimuli or drive that spark an interest to develop appropriate marketing strategies to trigger consumer interest .
INFORMATION SEARCH There are two aspects to information search, such as: Internal Search : Involves remembering previous experience of the product category (search their memory for information) External Search : Obtaining information from sources such as newspapers, catalogues, TV advertisements, friends/colleagues, sales force and of course the internet. An organisation must design its marketing mix strategies to make prospects aware of and knowledgeable about its brand. It should carefully identify consumers’ sources of formation and the importance of each source.
EVALUATION OF ALTERNATIVES This stage involves the buyer establishing a set of attributes or criteria against which to compare the products/brands under consideration. Hotels: Location, cleanliness, environment, price Cameras: Picture sharpness, camera speeds, camera size, warranty, price. Smartphones: Camera pixels, storage, battery, warranty, price Marketers should understand how consumers actually evaluate brand alternatives. If they know what evaluative processes go on, marketers can take steps to influence the buyer’s decision.
PURCHASE DECISION The purchase stage, when the consumer chooses which product or brand to purchase, is mainly the outcome of the consumer’s evaluation of alternatives & information collected. Generally, the consumer ’s purchase decision will be to buy the most preferred brand, but two factors can come between the purchase intention and the purchase decision. Attitude of others - If someone important to you thinks that you should buy the lowest- priced car, then the chances of you buying a more expensive car are reduced. Unexpected situational factors - unexpected events may change the purchase intention. For example, the economy might take a turn for the worse, a close competitor might drop its price, or a friend might report being disappointed in your preferred car or the attitude of the sales people, not accepting credit cars, delivery etc Thus, preferences and even purchase intentions do not always result in actual purchase choice.
POST – PURCHASE BEHAVIOUR/EVALUATION • The satisfaction or dissatisfaction that the consumer feels about the purchase • Relationship between: – Consumer’s expectations – Product’s perceived performance • The larger the gap between expectation & performance, the greater the consumer’s dissatisfaction • Cognitive dissonance is the discomfort caused by a post-purchase conflict Marketers task is to mange cognitive dissonance
KEY/FACTORS/INFLUENCES ON CONSUMER BUYING PROCESS
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