Transcript Marketing Research - AUEB e

INTERNATIONAL MARKETING
RESEARCH
LECTURE 1
AUEB PRIMA
Introduction
Panos Repoussis
Lecturer
Department of Marketing and Communication
AUEB
Assistant Professor
School of Business
Introduction

Welcome to IMR

Participant introductions
Brief CV





Dipl. in Chemical Engineering, National Technical
University of Athens
MSc. in Process Systems Engineering, Imperial
College London
PhD. in Management Science & Technology, Athens
University of Economics and Business
12 years experience in EU R&D and ICT projects
Areas of expertize:
 Freight
Transportation and Logistics
 Supply Chain Analytics
 Marketing and Retail Analytics
Purpose and Goals
Purpose of Course


As the complexity of the problems facing managers has
increased in recent years, so has the need for information –
about the business environment, the competition, and more
importantly, the customer.
As a marketing or general manager, you will frequently come
in close contact with market research throughout your career.
Purpose and Goals
Purpose of Course




This course is designed to equip you with the appropriate skills, so as
to become an intelligent user of international marketing research.
The goal is to provide you with a good understanding of the rational
of marketing research, by covering the various types of research
designs and stages of the marketing research process.
Particular emphasis will be placed on the role of marketing research
in facilitating decision making, through the use of applied case
studies in real business settings.
The ultimate purpose of this module is to give students the
opportunity to develop their skills in the use of various IT related
software packages (e.g., SPSS) for the analysis of consumer and
market research data.
Learning Objectives
Upon completion, students will specifically learn how to:




To understand the interplay between marketing management,
consumer behaviour and international marketing research.
To adequately define research problems and critically
evaluate alternative research designs.
To develop and implement a sound research plan (including the
selection of the appropriate research design, development of
the data collection instrument, sampling method, collection and
analysis of data, results reporting).
To understand the various data analysis procedures used in
international marketing research.
Course Syllabus
Course Material



Assigned Readings: Students should be prepared on each
reading assignment on the day it is to be discussed.
Lectures: Difficult and technical areas will be reviewed in class
to increase understanding. The lectures will build on literature
and theories in core areas of international marketing
research.
Applied Case Studies: A selection of cases applied in real
business settings will be discussed thoroughly in class sessions.
During these sessions, students will be called upon individually
to express their thoughts, analytical approaches, conclusions,
recommendations, etc. through an interactive dialogue with the
instructor.
Course Grading

Exam = 60%
 The
exam will be a comprehensive evaluation of the
students’ understanding of the various international
marketing research concepts covered in class, through
their application in real case scenarios.

Group Project = 40%
 Students
will form groups of 4-5 people and each
group will be asked to carry out an actual marketing
research project. All stages of the research process will
be involved, from problem definition to presentation of
the findings.
Other Course Aspects

Textbooks







Marketing Research: An International Approach (2006), Schmidt and
Hollensen, Pearson Education, (S&H)
International Marketing Research (2005), Craig and Douglas, John
Wiley & Sons, 3rd edition, (C&D)
International Marketing Research (2004), Birgelen and Beuckelaer,
European Commission, (B&B)
E-class
Library
In class material
Web sources
Contact Information

If you have questions, comments, or suggestions,
please feel free to write, call or send e-mail
 Dr.
Panagiotis Repoussis, [email protected] or
[email protected], appointment after phone or email.
Greece: Derigni 12, 5th floor, Office no.1 2108203437
and 6944794763
US: 201 216 3342 / 201 978 3741, Office 626,
Babbio Center, 4th Floor
Introduction
Globalization of markets
and international marketing research
What is marketing research?
The systematic and objective
process of generating information
for aid in making marketing
decisions
What is marketing research?

We can use Marketing Research to:
Identify
& Evaluate Opportunities
Analyze Market Segments
Select Target Markets
Plan & Implement Marketing Mixes
Analyze Marketing Performance
Performance
Monitoring Research
What is market intelligence?

Market intelligence (MI) is, “the process of
acquiring and analyzing information in order
to understand the market (both existing and
potential customers); to determine the current
and future needs and preferences, attitudes
and behavior of the market; and to assess
changes in the business environment that may
affect the size and nature of the market in
future.”
Spending on Market Research by Sector in the UK
Non-ad. research
agencies
Other
4% 5%
Ad. agencies
4%
Retailers and
wholesalers
9%
44%
13%
Public sector
21%
Service companies
Manufacturing
Companies
The Ten Most Common Market Research Activities
Activity
Percentage of companies doing
activity*
Directly
relevant to
NPD
Determination of market characteristics
97
Measurement of market potential
97
Market share analysis
97
Sales analysis
92
Studies of business trends
91
Short range forecasting
89
Competitive product studies
87
Long range forecasting
87
Pricing studies
Testing existing products
* based on research activities of 599 companies in the US
83
80
A more rigorous definition
Marketing research is a key element within the total
field of marketing information. It links the consumer,
customer and public to the marketer through
information which is used to identify and define
marketing opportunities and problems; to generate,
refine and evaluate marketing actions; and to
improve understanding of marketing as a process and
of the ways in which specific marketing activities can
be made more effective.
ESOMAR = European Society for Opinion and
Marketing Research

Potential Problems
Correctly Positioning New Products
 In China, PepsiCo was initially unsuccessful in
introducing its Frito-Lay brand of potato chips into
the market. Sales were particularly low in summer
months. Research revealed that Chinese shoppers
associated fried foods with yang, believed to
generate body heat in summer months (Fowler and
Setoodeh, 2004). As a result, Lay’s introduced a
‘cool lemon’ variety in pastel-colored packaging to
reflect yin, a cool feeling. The product subsequently
became Lay’s most successful in China.
Potential Problems
Avoiding Product Formulation Errors
 Research can also help in uncovering how to
reformulate products for local palates. HJ Heinz, for
instance, wanted to market its oat-based baby food
in China. Research showed that the Chinese were
not familiar with oats and hence it was unlikely to
be a popular food for babies (Fowler and
Setoodeh, 2004). On the other hand, whitebait, a
tiny fish, was discovered to be a staple food for
infants in China. Heinz reformulated its baby food
and produced a whitebait–oats combination.
Potential Problems
Sensitivity to Geographical Differences
 Microsoft launched Windows 95 in India with a
color-coded map that did not show the disputed
Jammu-Kashmir region as being part of India. As a
result, Windows 95 was banned throughout India,
leading to a substantial loss of sales. When Office
97 was launched, the color coding was eliminated
and the company sold 100 000 copies.
Potential Problems
Understanding Cultural Change
 Rapid changes around the world make it imperative
that firms understand what consumers are thinking
and how values are changing. To help its clients,
McCann Erickson, the large global advertising
agency, conducts marketing research in more than
40 countries simultaneously. Comparisons are made
between sets of countries.
Potential Problems
Identifying Appropriate Advertising Appeals
 The appropriateness of advertising appeals also
needs to be assessed through research. An
$800000 research project in Brazil helped Coke
identify a motherly female kangaroo as the
advertising device mostly likely to appeal to women
shopping for their families. Although there are no
kangaroos in Brazil, the animal tested well among
Brazilian women, who said they thought it
represented freedom, but at the same time
responsibility and care for children.
Potential Problems
Assessing Translation Errors
 Research can also aid in assessing the need for
translation. In entering Eastern Europe, Procter &
Gamble (P&G) translated its detergent labels into
Polish and Czech to adapt its products to the local
market. However, consumers reacted negatively,
perceiving this as an effort to dupe customers by
passing the company off as a local Polish firm.
Globalization

An international market researcher has to deal with
a number of countries that may differ considerably
in a number of important ways.
 cultural
dynamics on consumption and purchasing
patterns worldwide.
 International marketing decisions are concerned with
priorities and allocation of resources between countries.

Globalization is a factor of growing importance. It
represents the growing interdependence of national
economies – involving consumers, producers,
suppliers, and governments of different countries.
Globalization (cont.)

Information is a key ingredient in the development
of successful international marketing strategies.
 Information needs are changing and becoming
ever more complex and diverse. Timely and
relevant information is essential to provide on
adequate basis for day-to-day decision-making
Globalization (cont.)

Lack of familiarity with customers, competitors and
the market environment information, coupled with
the growing complexity and diversity of
international markets makes it increasingly critical to
collect information pertaining to these markets.
 The
speed of business, the flood of information
provided by new technologies, and flatter
organizational structures are driving this trend.
Information collection difficulty


Collecting information about international markets is
hard.
While numerous sources of secondary data for
international markets are readily available, issues
of comparability from one country to another and
reliability arise especially with regard to emerging
country markets.
Information collection difficulty


Primary data collection is also complex, since the
research design has to be adapted to different
cultural, linguistic, economic and social environments.
Often, exploratory research has to be conducted in
order to define the problem more clearly, to
determine precisely what should be investigated, as
well as by whom. Questionnaires have to be
translated and the research instrument adapted to
the new environment.
Market research interview
Cultural differences…
 The way in which respondents interact with
interviewers varies greatly. In some lesserdeveloped countries, there is a real desire to please
the interviewer. This, along with other cultural
differences, results in the variation in scaling.
Differences also exist between “no answer” and
“refused”.
Multinational vs global operation


Ethnocentrism: This is the lowest level of
international commitment. At this stage the firm is
mainly home-market oriented and it tries to dump
excess goods on occasional ad hoc export markets.
Polycentrism (multinational / multidomestic firm):
International marketing programmes are designed
independently to match the needs of each
individual country.
Multinational vs global operation


Regiocentrism: International marketing
programmes are designed independently to match
the needs of areas / regions (e.g. EU) that may
have similarities that transcend national boundaries.
Geocentrism: The global marketing programmes
are designed on the basis of the perception that the
world markets are progressing toward a converging
commonality and that the “Global marketing”
approach represents the prevailing trend in doing
business abroad.
Multinational vs global operation



Large companies are associated with geo- and
poly-centric strategies
Medium-sized companies are more related to
regiocentric strategy
Small companies are statistically unrelated to any
Complexity of International
Marketing

Diversity of the International Environment
 High-income
vs low income countries
 Level of literacy
 Linguistic heterogeneity

Continually Changing Environment of International
Markets
 Technology
diversity and new modes of communication
 Innovations are now spreading horizontally across
countries and societies. No sooner does a new trend or
fashion emerge in one country than it spreads rapidly
to another.
What information market research
can provide?



Information for International Market Entry
Information for Local Market Planning
Information for Global Rationalization
Information needed
Phase 1
Deciding whether to
internationalze
Phase 2
Deciding which markets
to enter
International
marketing
Research
Decision support
system
Phase 3
Deciding how to enter foreign
markets (market-entry strategies)
• Assessment of global market
opportunities (global demand) for the firm’s products
• Commitment and competences for internationalizing
• Market potential in regions/countries/segments
• Local competition
• Competitiveness of the firms compared to local and
international competitors
• Nature of the product (standard versus complex)
• Behaviour of potential intermediaries
• Behaviour of local competition
Phase 4
Designing the international
marketing programme (the 4Ps)
(standardisation or adaptation)
• Buyer behaviour (intermediaries and end-customers)
Phase 5
Implementing, coordinating, and
controlling the international
marketing programme
• Negotiation styles in different cultures
Phases in international marketing planning
Source: Hollensen: Marketing Management: A Relationship Approach, © Pearson Education Limited
• Competitive practice
• Available distribution channels
• Media and promotional channels
• Sales by product line, sales force, customer type and
country/region
• Contribution margins
Make or buy?


Some years ago, Philip Kotler observed "companies
tend to spend ½% on research and 99.5% on
promotion, when they would be better off spending
1.5 to 2% on research.“
Today's world, however, is more complex and fast
moving than it used to be. All firms must use their
marketing information more efficiently!
Make or buy?
Advantages (pros) of outsourcing:


Market research firms specialize in gathering, analyzing and
reporting information. They have a comparative advantage
and can probably do this type of job more efficiently than the
average corporation.
Market research companies have access to diverse
professional talent that few other firms have (statisticians,
psychologists, etc.). For full-scale consumer surveys, it is unlikely
that you have the personnel in-house or that you could divert
sufficient staff to do the job properly. Even if you could, you
might not want to spend the necessary time and money to train
them for a one-shot project. That is what the field staff of
market research firms is for.
Make or Buy?


Market research outfits have specialized facilities
and software, including focus group rooms with twoway mirrors and state-of-the-art taping capability,
electronic interviewing and data processing
capability and product test centers.
Anonymity and security. Reputable market research
companies never divulge the name of their client,
which protects you while simultaneously increasing
the validity of study findings by minimizing bias.
Make or Buy?


Objectivity, especially if emotions are running high,
the marketing issues have become politicized, or
there is internal disagreement among different
factions.
Market research companies have access to a wide
range of information and do business with clients in
many different industries. They know where to find
data. Good market research suppliers can apply
their knowledge and accumulated experience to
make a project run more efficiently and more
effectively.
Make or Buy?
Disadvantages (cons) of outsourcing:
 It is unlikely that a vendor will ever understand a
client's situation as well as that client's own
employees do. With outsourcing, you get a broad
range of experiences that are usually not available
internally. With internal work, you get a deeper
knowledge of your organization and its needs.
Make or Buy?
Disadvantages (cons) of outsourcing:
 Outsourcing means that, to some extent, you have
less control over the work than you would have with
your own internal staff doing the research. In
managing your own research staff, you have daily
input in such areas as project flow and sequencing,
delegation of tasks and scheduling. If you do a lot
of in-house research, you will probably strive to
develop uniform methods and improve the overall
capability of your "research team."
Make or Buy?
Disadvantages (cons) of outsourcing:
 Vendors usually have their own way of doing things.
As a result, they may be slow to adjust to your
needs or preferences or procedures.
 Less control…
Determining whether to conduct a
market research
Time Constraints
Availability of Data
Is sufficient
time
available?
Information
already on
hand
inadequate?
No
Yes
No
Nature of the Decision
Yes
Is the
decision of
strategic
or tactical
importance?
No
Do Not Conduct Marketing Research
Yes
Benefits vs. Costs
Does the
information Yes
value
exceed the
research cost?
No
Conduct
Marketing
Research
The Decision Whether to Conduct Market Research
Market Size
Small Profit Margin
Small Cost likely to be
greater than benefit;
e.g., eyeglasses
replacement screw
Large Benefits likely to be
greater than costs;
e.g., Stouffers frozen entries
Large Profit Margin
Possible benefits
greater than cost;
e.g., ultra expensive
sportswear
Benefits likely to be
greater than costs;
e.g.,medical equipment
The market research process
simplified


Define the Problem
Develop an Approach to the Problem
Type of Study? Exploratory, Descriptive, Causal?
 Mgmt & Research Questions, Hypotheses





Formulate a Research Design

Methodology

Questionnaire Design
Fieldwork
Prepare & Analyze the Data
Prepare & Present the Report
Figure 2.1
C. Samuel Craig & Susan P. Douglas, International Marketing Research, Third Edition
©2005 John Wiley & Sons, Ltd.
Information
for
Strategic
Decisions
Table 2.1
Information
for
Tactical
Decisions
Table 2.2