MARKETING RESEARCH

Chapter 1: INTRODUCTION TO MARKETING RESEARCH

I (a) Basic or Pure Research: The

research which is done for knowledge enhancement, the research which does not have immediate commercial potential, the research which is done for human welfare, animal welfare and plant kingdom welfare is the basic or pure research.

Government of India, through Census, does research on population count to identify total population of India, no. of male, female, no. of families, no. of voters, etc. One of the major findings of census is, some rural areas, proportion of female is 10% less as compared to male. In some metros and mini metros, female count is marginally less than male. This situation might create problems in future. Govt. responded quickly to this trend and have implemented ad-campaign having punch line „a world without women‟.

Discovery TV channel highlights the basic research done by Australia and US Governments towards animal welfare and plant kingdom welfare. Some of the documentaries on animal rescue operations are quite remarkable. Sometimes social research may have commercial intention. Example: Jaago Re Campaign Objective- one billion voters by 2015. Intention is to get 4 million youth registered across 35 cities before general elections in 2009&one billion by next elections in 2015. The young coordinator of the campaign Mr Jasmine Shah,along with 11 people approach voters at crowded places&appeals to get registered as voter&also says to use helpline www.jaagore.com for any assistance.Tata Tea has sponsored some part of this campaign. (Taaza tea)This is a successful campaign because within 7 weeks of its launch,the website has managed to register 70,000younsters. (b) Applied Research: The research which has immediate commercial potential is called applied research. Applied research can

http://www.jaagore.com/

further be classified as problem oriented and problem solving research. Problem Oriented Research – This type of research is done by Industry Apex Body for sorting out problems faced by all the companies. For example NASSCOM regularly conducts problem oriented research for the benefit of all software companies. Similarly CII does the research for all types of companies. At global level, WTO does problem oriented research for developing countries. In India, APEDA (Agriculture and Processed Food Export Development Authority) conducts regular research for the benefit of agro industry. Problem solving Research – This type of research is done by an individual company for the problem faced by it. For example if Videocon International conducts research to study customer satisfaction level, it will be problem solving research. The findings of problem solving research are unique and only true for that company which does the research and cannot be generalized. Whereas findings of the problem oriented research could be generalized.

Market Research and Marketing Research are the applied research. II NATURE OF MARKETING RESEARCH The nature of marketing research is very much linked with marketing as such. It deals with each and every decision which marketing also deals with. In nut and shell marketing research involves research related to nature and range of products, demand for the products, pricing, distribution and promotion, etc.; virtually every aspect of serving customer or clients right from idea generation till delivery, recovery of payment, installation and training. III OBJECTIVES OF MARKETING

RESEARCH

(a) To generate, refine, evaluate marketing plan.e.g bottled water.

CURRENT MARKETING SITUATION( Bislerry)

(i) Market Size : Rs. 1700 Cr (2007) (ii) Growth Rate : 17-20% P.A. (iii) Target Market : Health conscious consumers (iv) Product Situation : Current and projected profits loss statement 0-7-8 08-09 (a) Industry Sales 1700 Cr 2000 Cr (b) Parle‟s market share 25% 425 Cr (c) Average Price per Unit MRP / Stokists / Retailer 1200 ml 10 7 8 500 ml 6 4.50 5 (d) Average cost per unit 1200 ml 5.60 500 ml 3.60 (e) Gross contribution (c-d) 1.4/0.90 % 20% (f) Sales volume in units : 56.6 Cr 500 ml 60% 500 ml + 40% 1200 ml 24.2 Cr 1200 ml

(g) Total Gross Margin 20% 85 Cr (h) Depreciation, Interest & Tax 50% of GM 42.5 Cr (i) Net profit (g-h) 42.5 Cr (10%) (j) Advertising & Promotion cost 3% of sales 10.5 Cr (k) Sales Force management & Distribution cost 6% 21 Cr (l) Marketing Research expenses 0.1% 3.15 Cr (m) Net operating profit (i-j-k-l) Amount 7.85 Cr % 1.84%

(b) Monitor marketing performance and

improve impact of marketing programme. (Example of launching of Hum Tum movie)

(c) To identify market potential [Case study of Reliance Petroleum for identifying market potential for petrol (8 million ton) diesel (40 million ton)

and launching of value added petrol pumps] d)Stress on innovation for market growth&profitability.

The most innovative firms define “innovation”

broadly. They believe that innovation is not just

about developing new products and services but,

more fundamentally, about discovering new ways to

create value. At Marico, for example, innovation is

referred to as “uncommon sense”. According to

Marico’, “Uncommon sense is a mindset that seeks to

create and unlock new value by challenging

prevailing rules of the market. According to ICIC:

Innovation is the ability to identify opportunity and

seek new growth horizons continually using people,

processes and delivery mechanisms as the platform.

A broad definition of innovation helps companies to

think beyond R & D and to move to the next level of

innovation: creating new processes, new distribution

channels, new business models and new ventures. THE MARICO WAY

A FOUR-PRONGED STRATEGY FOR GROWTH

Strengthen existing brands like Parachute and Saffola by adding new brand extension, adding

value by adopting a health positioning, and

launching more variations. Example: Saffola

atta mixes and Parachute gels

Expand the international consumer business with key acquisitions in geographies like South

8881007

1144

1557

1907

0

500

1000

1500

2000

2500

2003-04 2004-05 2005-06 2006-07 2007-08

CAGR 21 per cent

Africa and Egypt. Also eying the booming

African markets and strengthening its position

in Bangladesh and West Asia.

A focus on health and wellness, with close to 65 Kaya Clinics. Kaya has got into the weight-

loss space with kaya Life Clincs

Develop new products by prototyping them in small markets

MARICO – Successful FMCG company

Fast Mover

The growth just keeps coming.

Sales and Services

5970

87

113

169

0

20

40

60

80

100

120

140

160

180

2003-04 2004-05 2005-06 2006-07 2007-08

CAGR 30 per cent

6574

98

150

205

0

50

100

150

200

250

2003-04 2004-05 2005-06 2006-07 2007-08

CAGR 33 per cent

Profit before tax

Net profit

During the year, Kaya clocked revenues of RS. 100

crore. But more than its increasing contribution to

group revenues, Kaya holds the promise of boosting

the company’s bottom lines, thanks to its distinct

service model. Typically, kick-starting a Kaya a

clinic takes Rs. 1-1.3 corre (including technology

investments and interiors) in a metro city. The clinic

breaks even in about nine months in ametro and

takes a little bit longer in smaller cities.

To boost its product revenue stream, Kaya began

prototyping its “shop-in-shop” model through kiosks

at malls. “We are now present in about 36 locations

like Shoppers’ Stop, Hypercity and Lifestyle.

Hair Apparent

Parachute is a leader, and Marico is sitting pretty in

the branded coconut oil segment

Presence in

Hair Care

space

Estimated

Market

Size (Rs.

Crore)

Keybrands Market

share

(%)

Closet

Competitor

Value-added

coconut oil

200 Parachute

advansed

Jasmine

85 Clinic

11.79

13.53

4.07

-9.71

-7.92

-15

-10

-5

0

5

10

15

Car Jeep Truck Auto rickshaw Motor Bike

Amla oil 350 Shanty

Badam Amla

10 Dabur,

bajaj

Non-sticky

hair oil

250 Hair and

care

18 Keo

Karpin

Bajaj

Post-wash

conditioner

50 Silk-n-Shine 30 Sunsilk,

Livon

Hair gel and

creams

80 Parachute

after shower

30 Brylcreem

Hair fall NA Parachute

Hair

Therapy

NA NA

e)To research trends. Trends in vehicle

Vehicles sales 07-08

cars 1203531

U.V. 344454

C.M. 486817

Two.W. 7248600

Three.W. 364703

Total 9648105

Most Trusted Brands, Top 10

2008 Company 2007 2006 2005 2004

1 Nokia 4 44 71 -

2 Colgate 1 1 1 1

3 Tata Salt 13 5 5 6

4 Pepsodent 8 15 11 5

5 Ponds 9 4 6 3

6 Lux 3 2 2 4

7 Britannia 5 8 8 7

8 Dettol 6 3 4 2

9 Lifebuoy 7 13 13 11

10 vicks 2 7 9 13

IV IMPORTANCE OF MARKETING

RESEARCH Marketing Research helps the marketer in following decision areas:

(a) Target Market To understand taste, preferences and choices of consumers, to understand market size, to measure market potential, to interpret consumer

behavior, to study influence of life style on target market behavior.

(b) Products / Services To identify customer satisfaction, to identify customer service levels, to study and to augment product features, attributes as well as to identify service gaps

(c) Price To study price affordability of target market, to study competitive pricing structure, etc.

(d) Distribution To identify prevailing channels of distribution, emerging channels, channels of distribution by competitors and modification to be done in channels structures as per market requirement. (P&G introduce master wholesaler between stockiest and retailer to augment service level)

(e) Promotion To design promotion mix, to identify promotion mix of competitors, to study emerging promo tools (road shows, pops and kiosks)

V BENEFITS OF MARKETING RESEARCH

(a) Conducting Marketing Management to identify strength and weaknesses of the marketer as well as the competitors.Also to research market shares.Example of HUL.

HUL as Winner in the Market? Category: Fabric Wash Market Size: Rs. 8875 Crore

Company Quarter ended 2007

Mar. June Sept. Dec.

HUL 35.2 36.5 37 37.5 P&G 7.5 7.4 7.7 7.4

Nirma 13.4 13.1 13.2 13.6

Category: Shampoo Market Size: Rs. 2141 Crore

Company Quarter ended 2007

Mar. June Sept. Dec. HUL 46.9 47.5 47.7 47.8

P&G 25 24.8 24.3 23.7

CavinKare 12.6 12.4 12.4 12

Category: Personal Wash Market Size: Rs. 6553 Crore

Company Quarter ended 2007

Mar. June Sept. Dec. HUL 55.3 54 53.2 54.3

Santoor 6.2 6.6 6.9 7.5 Nirma 7 6.6 6.7 5.7

Category: Skin Care Market Size: Rs. 2758 Crore

Company Quarter ended 2007 Mar. June Sept. Dec.

HUL 54.8 55.1 55 54.5

Boroplus 5 5 5 5.1

Vicco Turmeric

3.1 3.1 3.1 3.1

Category: Packaged Tea Market Size: Rs. 4396 Crore

Company Quarter ended 2007

Mar. June Sept. Dec. HUL 21.9 22.3 23.4 22.7

Tata Tea 18.9 19 20.2 20.8 Wagh 4 3.8 3.6 4.2

Bakri

HUL as second-best in a couple of segments Category: Toothpaste Market Size: Rs. 2733 Crore

Company Quarter ended 2007

Mar. June Sept. Dec. Colgate 48.2 48.5 48.2 48.8 HUL 30 30 30 29.5

Category: Ketchups Market Size: Rs. 271 Crore

Company Quarter ended 2007

Mar. June Sept. Dec. Maggi 32.2 30.9 30.9 30.3 HUL 26 25.5 26.9 28.1

(b) Determining whether economics of

scale and economics of scope (e.g. retailing, insurance and telecom can be clubbed by organized retailer like Shopper‟s stop, ICICI, etc.)

(c) Understanding needs wants and demands of target customers in India and abroad.

(d) To formulate sales and distributions strategies

(e) To avoid business recession by timely launching brand extension and or product variants (detail study of PLC or BCG matrix)

VI SCOPE OF MARKETING RESEARCH

(a) Type of consumers that comprise present and potential markets.

(b) Buying habits and pattern of consumption

(c) Size and location of different markets, not only in India but overseas also.

(d) The prospects for growth or contraction for the current markets

being served.( dVD vsVCD, CDVs Flopy)

(e) New mantras of emerging segments. (f) The marketing and manufacturing

capabilities of competitors. (g) Most suitable entry timing (h) The current and prospective

competitive position w.r.t. price, quality, reputation, etc.

(i) Chances of improvement of current channels

(j) Optimum use of promo-tools (k) The macro environmental factors like

changes in government regulations, effect of technological innovations, urbanization, etc. that will have any effect on the market for the product under consideration. For example FDI in Retail Trade. The Govt. rules are as follows.

(l) Govt. allows FDI upto 51% with prior approval in retail trade of Single Brand products.This is aimed at attracting investment in production &marketing,improving the availabilityof such goods for consumers,encouraging increased sourcing of goods from

India&enhancing competitiveness of Indian enterprises through access to global designs,technologies&management practices.

2) FDI upto 51% in retail of SINGLE BRAND products only. ---- Products should be sold under same brand interbationally. --- Single brand product retailing would cover only products which are branded during manufacturing. 3) Cash&Carry- This is B2B format,where the retailer sells to shopping establishments&large institutional customers.Metro in Bangalore is cash-n-carry

VII LIMITATIONS OF MARKETING

RESEARCH / OBSTACLES IN ACCEPTANCE OF MARKETING RESEARCH

(1) In corporate India total number of

companies could be more than 10,000 whereas companies engage in conducting marketing research, in organize sector are around 10 to 15 and unorganized around

32 to 50; of which the major are leading marketing research companies and their sales turnover is as follows:

Marketing Research Company

Services offered

Sales turnover for the year 2005 (Rs. In

Crores) ORG-MARG People meter,

retail audit 100

MRAS Test marketing 25

MBA Opinion polls 10

RCG Perceptual maps 12 STANDARD RESEARCH

Customer satisfaction surveys

10

IMRB Advertising testing research

75

Total 232 Corporate India‟s turnover is few billion $ whereas sales turnover of all marketing research companies (organize and unorganized) does not exceed more than Rs. 500 crores. This indicates that marketing research is not very popular with corporate India.

The big shots in consumer non-durables i.e. HLL and ITC hardly spend around Rs. 25 crores and 20 crores respectively annually on marketing research, which is not even 1 per cent of their sales turnover. This fact confirms unpopularity of marketing research with corporate world. The reasons for unpopularity could be as follows: (2) Narrow conceptions: MR is perceived as

data collection activity only i.e. a clerical job. This is because the marketer never comes in forward of respondents and explains to him the objectives of research or purpose of research. E.g. Times of India and Indian Express conduct research for estimating readership and viewership every six months. The boys recruited are under-graduates who do not know the purpose of the study. They judge jott down the answers on structured questionnaires and say that they are doing marketing research. Hence the respondents form perception that marketing research is clerical job.

(3) Improper orientation of the investigators – data collection activity is normally enthrusted to first year management

students without imparting any training to them. The respondents are just given quota i.e. they have to complete say 100 surveys in one week‟s time and submit 100 questionnaires. Normally, the interviewer is not able to complete this work in one week‟s time and to fulfill the quota on his own he fills up the questionnaire. This hampers the accuracy of the survey.

(4) Late results - well design and plan survey which is to be completed by conducting personal interviews might take 4 to 6 months time. In marketer‟s opinion, the survey should not take more than one month‟s time since he perceives it as clerical job. As such the report submitted by marketer may not be attended by the sponsors.

(5) Conditional findings – MR companies normally want to play safe i.e. due to volatile Indian markets, they never recommend any marketing strategy. In place they normally recommend conditional strategies i.e. if this happen, this marketing strategy will work. Such conditional marketing plans are not

acceptable to the marketer because marketer can hardly control the conditions.

(6) Cost affair – Field research is always very costly because the expenses like traveling, conveyance, lodging, meals, communication, etc. to be incurred e.g. a survey done for nation wide market for consumer non-durable like toothpaste might require few crore rupees. However, marketers opinion is it should not take more than few thousand since he perceives MR as clerical job.

(7) Biasness – Research may have biased due to (a) Improper research techniques (b) Inadequate skill of investigator (c) Researcher inclined towards pre-

determined results. vIII Definitions of MR 1 MR is a tool for a study ---------

To measure →needs, wants, demands. To evaluate →consumer attitudes To interpret →consumer behavior Of various target markets.

2 MR is the systematic gathering recording &analyzing of data about problems relating to the marketing of goods &services. 3 MR is the objective & formal process of systematically obtaining, analyzing &interpreting the marketing data for actionable decision making. IX MR &market research.

Chapter II. Sources & collection of Marketing data

SOURCES OF SECONDARY DATA Government Sources

Name of the Source Information provided

1) Directorate General of Supplies & Disposal (DGS&D)

Installed manufacturing capacities & actual utilized capacities for all manufacturers 2) Directorate General of

Trade & Disposal

3) Reserve Bank of India (RBI)

Availability of foreign currencies.

4) Directorate General of Commercial Intelligence & Statistics

Import-Export statistics

5) Centre for monitoring Indian Economy (CMIE)

Economic Growth, GDP

6) Census Population, no. of families, no.of voters

7) Geographic Survey of India

Regionwise production of agri-produce

8) Horticulture Board of India

Value-added fruits, vegetables & flowers and markets

Name of the Source Information provided

9) Directorate General of Foreign Trade (DGFT)

Import Export Regulations

10) Exim Bank Creditworthiness of importers and countries.

11) Export Credit Guarantee Corporation of India (ECGC)

Insurance covers and financial guarantees available to exporters.

12) Agriculture & Processed Food Export Development Authority(APEDA)

High Tech Agri Farming, technology tie-ups, seed capital, inspection, etc.

13) Central Statistical Organisation (CSO)

Industry Economics

14) National Sample Survey (NSS)

Per Capita consumption & monthly per capita income, literacy per state, employment across male & female etc.

Non-Government Sources

1) Org Marg

TRP ratings, Retail Store Audit

2) INSDOC (private Library)

Any publication after 1970

3) Path Finder

Household disposable income & consumer behaviour.

4) University Public Relation Offices

Various courses, fees, duration and eligibility.

5) Yellow Pages & Ask Me

Classified information

6) Internet Sites Classified information

7) Indian Association of No.of Retailers, their

Retailers classification, types, etc.

8) J.D.Power Asia Pacific

Customer satisfaction Index Survey

9) Technopak } Retailing in India 10) A.T.Kearney }

• THE NATURE OF SECONDARY DATA • Secondary data is available from

publications, in-house databases, research agencies etc. It constitutes readymade information that can be used for research purpose with minimal analysis. However, the researcher should bear in mind that secondary data is published for purposes other than the current research.

• Collecting primary data involves field work and further analysis on the data collected to arrive at a conclusion. For instance, a marketer who wants to launch a particular product may be interested in collecting data regarding the buying habits of consumers in that particular region. The marketer can conduct field surveys to collect the relevant data, which, in turn, can be analyzed to arrive at a proper conclusion. But at the same time, he can refer to any published material that has already done an analysis. While the first method is tedious, time consuming, and expensive, the second

method, which is collecting secondary data, is fast and inexpensive.

• 2.2 ADVANTAGES OF SECONDARY

DATA • One of the main advantages of

secondary data is that it is quite inexpensive. A small start-up company study the market to launch a product may not be able to afford to do primary research. By getting hold of good reports and articles, such small organizations will be able to do the study cost effectively.

• Secondary data helps researchers save time. While primary research takes a considerable amount of time in the form of collecting and analyzing the data, secondary data offers readymade solutions.

• If the demographics of a particular region have to be studied, the researcher has to collect the statistics of the population. It is impossible for any organization to conduct such a census study. Here too, secondary data published by a government organization will be of considerable

use. Moreover, data collected and published by the government will be less biased.

• 2.3 DISADVANTAGES OF SECONDARY DATA

• The major disadvantages of secondary data are

• Relevance • Accuracy • Sufficiency • Availability Methods of data collection in field research

Element of differentiation

Personal interview method

Mail method Telephone interview method

No of samples Not very high due time constraint

Large no samples can be contacted

Much more sample can be contacted as less time required

Time Is used when adequate time is available

Used when considerable time is available

Used when very short is available

Cost Highest Lowest Moderately high as compared to

MM

Accuracy Highest due to personal interaction and data recording with right understanding

Not very high due to a. Response rate not more than 20 to 25% b. Wrong interpretation of Qus. can not be sorted out.

Fairly high but depends on skill of interviewer in sorting out misinterpretation of Qus.

Use Not much useful when large geographic area is to be cover due to cost constraint

For geographically scattered samples this is best suited

For outstation samples the cost could be prohibitive hence useful local surveys only.

Infrastructure Huge infrastructure in form of project leader, research officer and investigators required

Almost negligible

In terms of skilled telephone operator and data base

Type of samples

Useful for ignorant and illiterate

Suitable for samples who can read and

Suitable if samples can properly

samples write communicate

Questionnaire Samples loose interest with lengthy questionnaire

lengthy questionnaire is no prob. bcoz Sample feel it at his convenient time

Legthy questionnare wont do bcoz sample is not directly seen

Interviewer Skilled Interviewer

can improve accuracy

Skilled o not skilled

Interviewer r does not

affect accuracy

Skilled Interviewer can improve

accuracy

Type of Qus Suitable for spontaneous

Ans since samples do

not like to tax their

memories

Suitable for spontaneous

as well as well thought

Ans

Suitable only for

Spontaneous Ans

Drawbacks/Limitations If investigators are not trend,

he himself might fill up

Questionnaire

Questionnaire might not be filled up by intended person

It is impossible to judge person contacted is

desired person as

such the 1st name of

sample must be known

Internet Interviewing

Web interviewing Email survey • Applications All type of

Exam marketing surveys

• • CAT • Admissions •

Advantages of Internet interviewing

• Fast set up, Execution and completion • Visual stimuli can be evaluated ( in case of

web cap) • Stimuli presentation can be controlled allowing for pre and post questions unlike

traditional mail. • Question presentation is consistent and

eliminates interviewer's bias • Questionnaire skip pattern can be

controlled • Less instructive process, allowing

respondents to ans as per their convenience

• Accurate responses possible since it is self administered.

• Eliminates cost of an interviewer • Permits real time data

• Much cheaper than traditional research procss.

Sampling

• Web interviewing can be generated provided sample are accessible. Hence

samples to b chosen from a. Visitors to a website

b. E-commerce customers c. Users of certain compuer hardware or

software d. Employees of a company that provides

web access for 24 hours e. Regular web surfers at net cafes

f. Wap users

Survey design characteristics

• Screen look and feel • Question layout

• Word dynamics for onscreen questionnaires‟

• Placement of graphics • Randomization of ans or stimuli • Richer open end responses

Applications

• Study of competitor's product where

PI/MM/TI may not be possible due to cost, time Ect.

• Marketer can heir a .com company to study competitor's actions

Limitations

• No. of PC owner/internet users are limited • This type of survey can not be for masses

but for classes • Sampling is complex due to problems in

identifying in sample frame.

Illustration A food product company wants to launch fresh orange juice as new product concept in soft drink markets. Suggest what data should it collect and how. The fresh orange juice is to be launched as new product hence the feasibility must be studied as follows:

(I) Information to be collected from Secondary Sources

(a) Orange availability statistics:

India Brazil West-Indies

Tanzania

i) area covered acres

600 1300 100 400

ii) volume grown in million

2 18 0.5 1.2

iii) Growth rate percentage

3-4% 6-8% NIL 1-2%

iv) Yield tons per hectare

3 14 0.75 1.5

Source: HBI/APEDA (b) Orange Producing states in India

States Main districts

i) Karnataka Curg, Hasan

ii) Maharashtra Nagpur, Vardha, Amravati

iii) Orissa Puri

Source: Geographic Survey of India

(c) Economic of Production i) How many trees can be planted at

one acre. ii) How many fruits are possible on

one tree per season. iii) How much time is required by a

tree to start delivering fruits. iv) What is average life of a tree. v) The cost of seeds ad maintaining

the farm.

vi) How many fruits will make one litre of juice.

vii) The popular pack sizes of serving juices

viii) The market price of popular pack size

(II) Information to be collected from primary sources, either by personal interview with questionnaire or by telephone interview.

(a) Information required for

launching i) What do you take as breakfast

drink. Milk/Tea/Fruit juice ii) Do you like taste of orange

juice. Yes/No iii) Would you like to offer orange

juice to your guests Yes/No iv) Would you like to offer orange

juice to your children. Yes/No v) What is your concept of orange

juice. Nutritive/low Calorie juice / Status Symbol / Feminine drink.

vi) Who in your opinion would be benefited most by having fresh

orange juice : Children / teen agrees / youngers / folders

vii) What price would you like to pay for say pack size of 250 ml of orange juice Rs. 10/-, Rs. 13/-, Rs. 15/-

(b) Information required for marketing i) Per capital consumption of

oranges and orange juice. ii) Prevailing brands, market

shares with high-light on investment done, years of existence.

iii) Type of distribution system in force

iv) Type of sales-promotional schemes launched.

v) Shelf life of the juice and packaging material being used.

From above information total costs and total revenues can be calculated and feasibility can be accessed.

Illustration : Marketing, Data Collection

Placement committee of a Management Institute intends to provide 100% jobs of their management students. Which information to be collected and how?

(a) List the management institutes in the region and classify them age wise.

(b) Get the „placement broacher‟ of atleast 10 institutes, so as to get idea on which corporate visited last year for placement.

(I) Top 15 Recruiters of choice

1) McKinsey & Co. 2) HLL 3) BCG 4) ITC 5) Citi Bank 6) HSBC 7) P&G 8) Infosys 9) HDFC Bank 10) Lehman Brothers 11) IBM 12) Olam International 13) Amex 14) Microsoft 15) ICICI Bank (Source:ET/BI/BL/BT)

(II) Ranking as per no. of students recruited by Industry sector 1) Management Consultant 7.87% 2) FMCG 6.77% 3) Software-IT consultancy 5.66% 4) Foreign Banks 5.19% 5) Financial Institutions 4.25% 6) Telecom 2.67% 7) Automobile 2.51% 8) Consumer Durables 2.36% 9) Retailing 2.35% 10) Insurance 2.35% 11) Pharmaceutical 2.35% 12) Advertising / MR 2.35% 13) Entertainment / Media 2.30%

14) Diversified companies 51.02%

(III) Management Institute should interact with Industry sector to understand traits expected by them through PI/TI/MM/Internet Interviewing.

Make available this information to Internal and External faculties as well as to students. Conduct training programme to develop respective skills.

(IV) Communicate respective industries on available skills

(V) Wait for call or generate the requirement through aggressive marketing.

MMM (Semester-II) Examiantion – 2006

Marketing Research Time : 3 Hours Max. Marks : 70 Instructions:

(1) Attempt any five questions. (2) All questions carry equal marks.

Q.1 Discuss some of the major uses of

Marketing Research in today‟s Corporate Environment of India. [14]

Q.2 (a) What are the major components of a

Marketing Research Report? [07] (b) Discuss the distinct coverage of each

major component of a written report. [07]

Q.3 Write short notes on ANY THREE: [14] (a) Consumer Panels (b) Retail Store Audit (c) National Readership Survey (d) Data Collection Methods (e) Semantic Differential Scale (f) Rating and Ranking Scales Q.4 (a) What general guidelines should one

follow in designing a questionnaire? [07]

(b) List the merits and demerits of multiple choice questions. Under what conditions multiple choice questions be inappropriate. [07]

Q,5 (a) Outline a suitable Likert Scale to

examine the corporate image of a bank measured by its location, number of branches, timings, service quality, behaviour of staff, etc. [07]

(b) For the same problem in Q.5 (a) construct a suitable semantic differential scale. [07]

Q.6 (a) Why is sampling used in Marketing

Research? [07] (b) What factors would you consider in

determining the sample size for a Marketing Research study? [07]

Q.7 State and explain various Limitations of

Market Research. [14]

PU, MMM, MR, MAY 2006 Q.5 (a) Outline a suitable Likert Scale to

examine the corporate image of a bank measured by its location, number of branches, timings, service quality, behaviour of staff, etc.

Assumptions: (i) The bank considered, say,

HDFC Bank (ii) Those corporates

considered, how have current accounts with HDFC Bank in Pune like Tata Motors, Thermax and Alpha Laval Ltd.

Solution: Likert Scale is about intensity of Agreement on a scale of +2 to -2 (5 point scale)

Attributes +2 strongly agree

+1 agree

0 Neither

Agree Nor disagree

-1 Disagree

-2 Strongly disagree

(1) Location

(2) No. of branches

TML Th ALL

(3) Work timings

(4) Service-Quality

(5) Behaviour of Staff

Scores TML = Tata Motors Ltd. = +2+2+2+2+2 = 10 Th = Thermax Ltd. = +1-1+0+1+1 = +2 ALL = Alpha Laval Ltd. = 0 -2+1+2+2 = +3

Q.5 B) Construct Semantic differential scale for Q. 5 A bank.

Attributes +3 +2 +1 0 -1 -2 -3

(1) Location

(2) No. of branches

(3) Work timings

(4) Service-Quality

(5) Behaviour of Staff

TML Wipro IIMP

Scores TML = +3+3+3+3+3 = 15 Wipro = +2+3+2+3+2 = 12 IIMP = +1+2+1+2+2 = 8

CH 3 SPECIALISED TECHNIQUES OF

MARKETING RESEARCH (I) NATIONAL READERSHIP SURVEY (NRS)

Objective of NRS is to provide such information which is simultaneously acceptable to media owners (DD, ET, etc.) Advertises (HLL, P&G, Godrej, etc.) and advertising agencies (JWT, O&M, etc.). It normally provides following information:

(1) The readership of 535 publications (230 dailies and 305 magazines) as follows: (A) Readership of Business

Magazines

S. No.

Name Readership (2006)

Readership (2005)

Readership growth (%)

1 Business world

680,000 523,077 (+)30

2 Business Today

676,000 757,000 \(-)11

3 Business India

450,000 371,901 (-) 21

4 B&E 253,000 NA --

(B) Readership of National Dailies

S. No. Title Readership 1 Dainik Jagran 5,36,00,000 2 Dainik Bhaskar 3,58,00,ooo

3 Eenadu 13,800,000

4 Lokmat 2,29,oo,ooo

5 AmarUjala 10,800,000

6 Hindustan(hindi+eng) 2,96,oo,ooo

7 Daily Thanthi 10,400,000 8 Dinakaran 9,639,000

9 Rajastan Patrika 9,391,000

10 Malayala Manorama 8,409,000

(2) Cinema and TV viewership and radio

listener sip as follows: (A) In India everyday, one crore

people watch cinema. In South India, people watch regional movies whereas in North India, people watch Hindi movies.

(B) TV viewer ship: India has 125 million TV homes, of which 68 million are C&S homes. From this, TV viewer ship can be calculated by multiplying number of people (5 per home) to TV homes.

(C) Radio Listernship : Indian radio reach – 95 percent population of India listens Vividh Bharati. Only 3 percent population listen private radio i.e. FM (say Radio Mirchi).

India has 190 radio centres with 324 channels. Prime time ad tariff for Vividh Bharati is Rs. 2000/- for 10 second ad and Rs. 1000/- for non-prime time. Similar figures for FM are Rs. 1600/- / 800/-.

(3) Reach of Indian Post Indian post has 1.56 lakhs post offices in 470 cities, 6,34,321 villages in 29 states. Total number of postman 3,59,685, area covered by each post office 21.13 sq.km., population served per post 6602. Everyday Indian post receives and distributes 0.35 crores mails, the configuration of which is as follows:

Service Subsidy per unit (in Rs.)

Traffic (in million)

Total deficit

(in Rs. Cr.) Post Card 6.1 255.1 156.6

Printed post card 0.7 43.6 2.9

Letter cards 4.1 327.5 135.4

Registration 16.0 223.3 357.9

Money Order 28.5 116.5 331.5 Reg. Newspaper (single)

7.9 59.3 46.6

Reg. Newspaper 12.2 3.6 4.4

(bundle)

Printed Books 9.2 2.5 2.3

Parcel 12.1 5.3 6.5

Others NA NA 160.0

Total 1203.0

(4) The degree of duplication among various publications and between the different media. For e.g. how many readers read same ad in two print media (Business Magazine and Economic Times) as well how many readers see the ad say in Economic Times and TV.

(5) Socio-economic characteristics of readers of various publications like dailies and magazines with respect to income level, educational background, profession, etc. Consumer profile for Dainik Jagaran is as follows:

(a) 4.3 million graduates and above

(b) 48% belong to SECA households

(c) 49% belong to 15,000 + income group

(d) 45% of readers have refrigerators

(e) 38% of readers have TV sets (f) 48% have washing machine

and ACs (g) 46% have four wheelers (h) 38% have motor cycles

Consumer profile for The Hindu is as

follows: (a) Two lakhs of readers belong

to SEC A1 (b) 19 lakhs belong to age 20+ (c) 12 lakhs belong to graduate

level education (d) More than 8 lakhs belong to

income Rs. 5000+ (e) Five lakhs have profession

like Executive, Business class, etc.

(II) Retail Stores Audit It is a method of quantitative feedback from the market on consumer buying habits. It is the exclusive service provided by ORG – MARG to Indian FMCG industry. The basic

objective of retail stores audit is to observe or count the movements of the products off the retailers shelves to the consumers. The procedure adopted is as follows:

(a) A list of retail outlets in India for a particular city is prepared by using data from Indian retailers Association. Based on the sales turnover, the retail outlets are classified as small, medium and large.

(b) The representative of ORG-MARG calls on all listed retailers to us their concurrence for providing information. Only those are visited who express willingness to cooperate.

(c) The teams are sent to different areas already planned in advance and with the guidelines on collection of data

(d) The team visit retail outlets twice in a month, once in first week of month (assuming retailer fills up inventory in the beginning of month) and during last week of month. The stop position is

actually counted for all the commodities, brands stock by retailer. The month-end inventory is subtracted from month-beginning inventory. The difference is the movement of goods of the retailer shelves.

(e) For recording the data, special booklets are prepared in which the team records the entries.

(f) The data from all the retail outlets is compiled and then systematically analyzed. The analysis provides following useful information:

(i) Total sales for product type (ii) Total sales for different

brands and thereby market share

(iii) Total sales for different pack sizes

The above information is very useful for marketing planning, packaging decisions and promotion decisions.

The main disadvantage of this method is Brand Loyalty can not be studied, for which next tool Consumer Panels is followed.

(III) Consumer Panels Retail Store Audit is quantitative tool whereas Consumer Panels is qualitative tool which focuses on Brand Loyalty. Such panels can be set up by manufacturing companies like HLL or Research Agencies like ORG-MARG or by Advertising Agencies like JWT. Sometimes Government also might formulate consumer panels for studying impact of budget on consumers, etc. The size of total number of panels depends on total population to be covered. For example, for consumer goods, to collect data from population of 27 crores consumers (USA) around 5,000 panels are required. From this formula, if we calculate for Indian markets, total 18,000 panels will be required for collecting the data.

The procedure of data collection is as follows: (a) The panel members are allotted a fix

area like one society having fifty apartments. So, in specified area, the societies are selected which have minimum fifty households. A panel consists of two people, essentially matured husband and wife.

(b) Panel members are asked to maintain purchase records in the registers provided by sponsor. The details to be recorded are as follows: Brand purchased, Number of units bought, Price paid, Pack size, Place of purchase and reason for purchase.

(c) Panels are advised to visit households on week-end days.

(d) The registers from panel members are collected at the end of the month and then the data is analyzed for complete city. After tabulating the information, it provides following valuable information: (i) Number of families purchasing not

only sponsors brand but competitor‟s brands also

(ii) Trends in retail sales: composition of India`s total Retail market is as follows:, Food&grocery 75%,Clothing&textile 7%, Consumer durables 4%,Jewelery&watches 4%Home décor&furnishing 3%,Beautycare 2%,Misc 5% (iii) Purchases by new customers V/s

Purchases by old customers (iv) Evidence of Brand Loyalty (Why

same product is purchased repeatedly or why product is purchased from a specific retailer or broker)

(v) Market share The major limitation of consumer panels study is its costliness. Panel members expect handsome honorarium which is as follows Rs. 50/- per entry per family per week. Hence for a month the total cost for nation wide survey works out to be – 18,000 x Rs. 50/- x 4 x 50 = 1,80,00,0000

(IV) TEST MARKETING

Basic objective of test marketing is to safeguard the investment risk before initiating commercial production. Test marketing could be done at one city at one time or many cities at same time. The criteria for selecting the test area i.e. the city is the profile of resident of city must match with target consumers‟ profile. The test marketing can be done in either of the following way: (i) Before the product formulation but

after branding, packaging, positioning, etc. has been finalized, to test expectations of consumers about product features. (examples – HLL‟s Closeup, HLL‟s Liril, M&M‟s Bijali, P&G‟s Pantene,

(ii) After the product is finalized but before introducing to markets, to test reactions of marketing middlemen, customers on brand name, style, looks, etc. (example – Tata Motors Indica, Bajaj Eliminator and Movies)

Whether marketer follow (a) type of test marketing or (b) type, he has to work out the market acceptance by using anyone of following methods are used to project estimate of national sales based on test area sales of test marketing: (a) Buying Income Method

Total Income of Country Estimate of national sales = --------------------------------- x Test Area Sales Test Area income

(b) Sales Ratio Methods

National sales of other product Estimate of national sales = ------------------------------------------------- x Test Area * Test area sales of this other product Sales of Test product

* This other product means similar products. For example, if test marketing of say semi-automatic washing machine is done then all sized semi-automatic washing machine are considered.

(c) Share of market method Test area sales of new brand

Estimate of national sales = ------------------------------------- x National sales of ** Test Area sales of this whole category

Whole product category

** Whole product category means entire product range. For example, if test marketing of washing machine is being done then entire home appliances are considered.

(V) RESEARCH IN ADVERTISING

DECISIONS At the end of the year, top management always ask the brand manager, a simple question like have you wasted money or have you invested money. This question could be replied by undertaking research in advertising as follows: The objectives for such research could be

(a) To identify target markets, their buying behavior, their perception on price and value of a product or service

(b) Ad copy testing for its effectiveness

(c) Media research and selection .Effective use of publicity to arrange company`s name always in news.

The companies in more News

India‟s Biggest News-Makers company

Rank 07

Automotive 1) Tata Motors

2) Mahindra & mahindra 3) Maruti Suzuki India 4) General Motors India 5) Hyundai Motor India 6) Ford India 7) DaimlerChrysler 8) Honda Siel 9) Toyota 10) BMW

11) Tata Motors 12) Mahindra & mahindra 13) Maruti Suzuki India 14) General Motors India 15) Hyundai Motor India 16) Ford India 17) DaimlerChrysler 18) Honda Siel 19) Toyota 20) BMW

1) Baja Auto 2) Hero Honda Motors 3) TVS Motor Company 4) Yamaha Motors Escorts 5) Kinetic Motor 6) Honda Motorcycle &

Scooter 7) Hero Cycles

1) Kingfisher Airlines 2) Jet Airways 3) Air India 4) Air Deccan (Deccan) 5) Indian 6) spiceJet 7) air Sahara (jtLite) 8) goAir

9) British Airways 10) Singapore Airlines

1) ICICI Bank 2) State Bank of India 3) Standard Chartered

bank 4) HDFC Bank 5) HSBC 6) ABN AMRO 7) YES bank 8) Union Bank of India 9) Punjab National bank 10) Axis Bank

1) ACC 2) Ambuja Cement 3) Holcim 4) India Cement 5) Ultra Tech Cement 6) Madras Cement 7) JK Cement 8) Dalmia Cement 9) Grasim 10) Prsim Cement

1) Ernst & Young 2) Pricewaterhouse

Coopers 3) McKinsey 4) KPMG 5) Accenture 6) Capgemini 7) ACNielsen 8) Boston Consulting

Group 9) Hewitt Associates 10) Deloitte

(d) To study image of company as well of the product

(e) To study effectiveness of ad agency

The procedure adopted is as follows: (A) Recognition test

(i) The respondents or samples are shown different advertisements of same product which appear in print or audio visual media and they are asked to recognize which one they have seen earlier, in which media, did they like it, if any. (ii) After masking brand name as well as sponsor‟s name, samples are asked to recall name of sponsors, name of brand and sometimes, name of ad agency too.

(B) Recall test (i) Respondents or samples are asked to recall all advertisements for a particular product. For example, “which advertisements have you seen recently for skin

moisturizers and in which media”. This is called as un-aided recall test. (ii) Samples are asked to recall a particular advertisement for a specific brand. For example “Do you remember having seen Shahrukhan with Lux soap, if yes, in which media”. This is called as aided recall test.

(VI) MARKETING AUDIT Definition: A systematic, comprehensive, independent and periodic examination of companies business unit‟s marketing problem areas and opportunities and to recommend an action plan to improve marketing effectiveness.

Marketing Audit (1) Marketing Environment Audit (2) Marketing Strategy Audit

(3) Marketing Organization Audit (4) Marketing System Audit

The frequency of conducting the exercise of marketing audit depends on type of products. For example, in case of consumer non durables the exercise might have to be

done twice in a year whereas for home appliances once in a year could be OK. (VII) DATABSE MARKETING Definition: Marketing Database system is an organize collection of comprehensive data about individual customers, prospects or even suspects (suspects can be converted into customers), i.e. current, accessible and actionable for marketing purpose such as lead generation and sales of a product or service or maintenance of customer relationships. Effective database marketing might start with employees itself (case study of Alpha Laval and Mrs. Poonawala to be discussed). For consumer durables, database marketing could be done as follows: All the dealers could be enlightened to ensure that the customers who walk in the shops to be converted into buyers. For this purpose, whosoever just enquires his name, address, contact nos. to be taken down and to be followed at regular interval till he is converted as buyer?

(VIII) FOCUS GROUP INTERVIEW

TECHNIQUE This is also known as indirect interviews. A group of eight to ten samples jointly participate in an unstructured interview conducted by a moderator. The samples selected have similar background or use experience related to the problem being research. The moderator in informal way goes on asking unstructured questionnaire and recording the data in two-in-one tape recorder. This information later on analyzed for decision making. Advantage: The data can be collected in shortest possible time, say, a day or two. Disadvantage: Since sample size is very small, accuracy could be doubtful. Moreover, in one focus group if a dominant personality is one of the sample then other samples gets carried away with his views even though they want to say something different. Case study of Sweden, car maker to be discussed. Assignment for students:

CONSTRUCT A FOCUS GROUP STUDY TO ANALYSE THE ISSUE “DO WE REALLY NEED INTERNET?”.

CHAPTER 4 SAMPLING QUESTIONNAIRE AND

SCALING TECHNIQUES Basic Terms in Sampling

i. Sample Population: It is pre-defined set of potential respondents (elements) in a specific geographic area where research is intended. For example: All mothers in Pune city who buy branded baby products. All teenagers in Mumbai who love watching MTV

ii. Sample Frame: It is a sub-set of the defined target population, from which researcher can select a sample for collection of data. Sample frame is usually a partial list of population. For Example: Telephone directory of Pune List of income tax payers in Pune

iii. Sample: It is the test unit, which provide information or data to the researcher. Alternatively, samples are the respondents who represent the characteristics of the target population and drawn from sample frame. Sample Size Calculation ZS

2

n = ------- e where n = sample size, Z = standard normal distribution for certain confidence level, e.g. Z95% = 1.96 & Z90% = 1.645, Z99 = 2.58 S = Population Standard Deviation Maximum value – minimum value = -------------------------------------------- 6 e = Tolerable error in estimating the variable

Illustration: Whirlpool intends to research customer satisfaction level for washing machine. Customer satisfaction level is to be measured on a scale 1 to 10 where 1 means not at all satisfactory and 10 means full satisfaction. Value of Z is 1.96. What should be sample size if tolerable error is 0.5? Solution: First compute S i.e. Population standard deviation

maximum value – minimum value S = -------------------------------------------- 6 10 – 1 9 = -------- = --- = 1.5 6 6 Substituting value in the formula 1.96 x 1.5

2

n = ------------- = 35 0.5 Whirlpool should interview 35 samples for the intended research. -------------------------------------------------- Sample Unit – a) Household – you & me i.e. end users (b) Industrial – manufacturers, wholesalers, retailers, etc.

Consideration Design Type

Probability Non-Probability

Cost More Costly

Less Costly

Accuracy More Accurate Less Accurate

Time More Time Less Time

Acceptance of Universal Reasonable

results acceptance acceptance

Generalisability of results

Good Poor

5.8 SAMPLING TECHNIQUES

Probability Sampling Non-probability Sampling

1) Each sampl4e unit in sample frame has equal or know chance of being included as sample

1) The chance of each sample unit from sample frame being included as sample cannot be estimated.

2) Samples are selected at random from sample frame.

2) Samples are selected w.r.t. prior Experience or judgement of the researcher

3) Whenever large sample size is involved, this method is used.

3) For accessing small sample size this method is used.

4) When highly accurate decisions of known errors are intended regardless of cost, this method is useful.

4) Whenever time and cost constraints are inevitable (like exploratory Research), this method is used.

5) Normally used for consumer goods survey.

5) Normally used for industrial goods survey.

5.9 ILLUSTRATION Emami wants to launch „Madhuri‟ and „Ishwarya‟ range beauty ayurvedic creams, say in Pune. How should it do sample design. Solution: Sample Population: All women in Pune using Skin creams as beauty-aid.

Sample Frame: All women of PUNE using Beauty ayurvedic creams between age group 10-50 Sampling Method: Stratified. Sampling Plan “Sample frame is divided into 4 groups as follows: Group 1 – School-going girls between 10-16 Group 2 – College –going girls between 17-23 Group 3 – Working ladies between 24 – 35 Group 4 – Housewives and working ladies between 36-50. Samples can be drawn from schools, colleges, offices, societies, etc. Justification : Beauty ayurvedic creams are costly and hence stratified sampling will ensure the income i.e. affordability. It is seen that at higher secondary school level, the girls are more cautious about looks. Hence, the age limit begins with 10. At the age 50, the ladies might value natural beauty. Four groups are formed to understand in depth the consumer profile and its preferences.

Sample size: 1%of frame&equally distributed over each group. (Sample frame for Pune contains 8 lacs ladies) Sampling Methods For probability sampling technique (i) Random Sampling (ii) Systematic Sampling (iii) Stratified Sampling (iv) Multistage Sampling (v) Area Sampling For non-probability technique (i) Purposive Sampling (ii) Quota Sampling Questionnaire Design and Drafting Following elements in balance manner make good questionnaire (i) The questions must be relevant to subject

matter and a set of questions must be able to cover the entire topic of the research (illustration of Chaitanya Health Clubs questionnaire)

(ii) The question should not indicate specific answers. (example of Amul‟s Masti curd and HLL‟s study on Surf Wash Boosters)

(iii) Lengthy and difficult questions would lose customer attention and hence short and easy questions to be posed.

(iv) Each and every question should create interest in the minds of samples so that samples also feel importance of question being asked and hence likely to give accurate answers seriously.

(v) Double-baralled Questions to be avoided. Inexperienced questionnaire designers have a tendency to combine two questions into a single question, such as: Are you happy with the price and quality of brand Y? Yes No

This is not a good question to ask, because the answer will be ambiguous, whether it is yes or no. It would not be clear whether the respondent has said yes for price alone, quality alone, or for both. The same problem exists for a „no‟ answer. It is better to rephrase the question and provide for different answer categories for each attribute or ask two separate questions,

one for price and one about quality. Then the interpretation of answer becomes far easier.

Appropriate Layout

Questionnaire Do‟s and Don‟ts Ensure questions are free of bias

Make questions simple Make questions specific

Avoid sophisticated words Avoid ambiguous words

Avoid negatives

Avoid hypotheticals

Information Needed (Secondary or Primary data)

Method of data collection, PI, TI or Observation

Sampling technique and

methods

Questionnaire Layout Design

Decide on content of each question Decide on type of questions

Decide on wording or questions Decide sequence of questions

Decide pre-testing of questionnaire

Final testing of revised questionnaire

Avoid words that could be misheard Use mutually exclusive categories Allow for “other” in fixed response

questions

Types of Questions (1) Open-ended question What do you think of the test of brand X cola?OR what is your opinion on ------- ? (2) Dichotomous questions (a) Are you user of X toilet soap? Yes / No. OR Do u have mobile phone ? Y /N (3) Multiple Choice questions

Which of the following factors made you by this brand of car: (a) Reasonable price (b) Great looks (appearance) (c) Fuel economy (d) Easy availability of service (e) Any other, please specify.

(4) Ratings or Rankings Rating questions (a) Please rate the following detergent on

A scale of 1- 7 in their ability to clean clothes

Brand A 1 2 3 4 5 6 7 Brand B 1 2 3 4 5 6 7 Brand X 1 2 3 4 5 6 7 OR Indian Airlines‟ food service is _____. Excellent

Very good Good Fair Poor

(b) Please rank for following detergents

on their ability to clean the clothes Brand A 1 2 3 4 5 6 7 Brand B 1 2 3 4 5 6 7 Brand X 1 2 3 4 5 6 7 (1 means best, 2 means better, 3 Means good, -------, 7 means worse)

(5) Indirect questions (a) Most of the people in India smoke

Non-Filter Cigarettes because ----------------

(b) Jo Bibi Se kare pyar wo -------- se kaise kare inkar?

(6)Likert scale Do u agree that we offer the best services? a) Strongly agree b) agree c) neither agree nor dis agree d) dis agree e) strongly dis agree OR Indicate your level of agreement with the following statement: Small airlines generally give better service than large ones. Strongly disagree Disagree Neither agree nor disagree Agree Strongly agree

(7) Semantic scale How do u think our service is?

a) excellent ------ worst b) better ----- very poor c) good ----- poor d) average OR Indian Airlines is Large ………………………………...…………….Small Experienced………………….………….Inexperienced Modern………………………..………….Old-fashioned

(8)Importance scale In flight, food service is _____ to me. Extremely important

Very important Somewhat important Not very important Not at all important (9)Intention to Buy Scale How likely are you to purchase tickets on Go-Airlines if in-flight Internet access were available? Definitely buy Probably buy Not sure Probably not buy Definitely not buy 11) Probability Scale Do you intend to buy an automobile (say, car) within the next 6 months? 0.00 No 0.20 Slight possibilities 0.40 Fair possibilities 0.60 Good possibilities

0.80 High possibilities 1.00 Certain

Illustration: Construct a questionnaire for understanding buyer behavior in Selection of television set for household segment Objectives: (i) What features buyers are looking for in a TV set (ii) How important the price to the buyer (iii) What are the methods of payment? (iv) The selection process of the buyer Questionnaire: (1) a. Do you own a television? Yes / No b. If yes, which brand / company name c. If no, go to question 7. (2) While buying a TV what are the features

you look for?

(3) Given below some of the features of the TV. How important is each one to you, please tick mark.

Features Extremely important

Important Some what important

Not very important

Not important at all

(i) Looks (ii) Portability (iii) Cabinet - Moulded - Wooden (iv) Size of the screen (v) No. of channels (vi) No. of speakers (vii) Auto control monitor (viii) Manufactures reputation (ix) Video adaptability (x) Integral DVD (xi) Foreign collaboration (xii) Guarantee offered (xiii) Servicing arrangement (xiv) Price (xv) Child lock (xvi) Games

(4) a. If a price of TV is classified as high,

medium And low then where your TV model belongs to?

c. How do you judge price of a TV with respect to the features of a TV?

d. Which payment option do you prefer? Cash / Installment

(5) At the time making brand choice decision, from whom among other following sources did you take the advice?

Family members Friends / neighbors Dealers

Advertisement Any other source, please specify (6) A set of statements are given below.

Please indicate your opinion, to be recorded a scale ranging from strongly agree to strongly disagree

Statements Strongly

Agree Agree Can‟t say Dis-agree Strongly

disagree

(i) Possessing TV set is a status symbol (ii) Observing TV is passing time (iii) DDs TV programmes are dull whereas C & S‟s

programmes are attractive (iv) TV affects children education (v) Indian TV programmes are educative (vi) TV is best source of entertainment (vii) TV is low cost entertainment (viii) Government‟s decision on expanding TV network through DTH and dish TV is appreciable (ix) TV is best gift item (x) people are confined to homes due to TV viewing

(7) Classified data (a) Age (b) Education (c) Occupation (d) Annual income of the family

SCALING TECHNIQUES 7.7 ILLUSTRATIONS

(1) Construct following scales of attitude measurement (i) Nominal (ii) Ordinal (iii) Interval (iv) Ratio (v) Thurstone

(i) Nominal Scale: Symbols or numbers are assigned to brand names, geographic territory, sex, user status, etc. Illustration: (a) Nominal scale to identify potential of cellular phone (WLL) w.r.t. territory

Following data is provided on WLL Mobile Telephone Users – city wise

City Mobile Telephone

Users

Symbol City Mobile Users

Symbol

1. Pune 80000 W 7. Puri 50000 E

2. Mumbai

300000 W 8. Hyderabad

180000 S

3. Nasik 50000 W 9. Bangalore

270000 S

4. Delhi 250000 N 10. Chennai

275000 S

5. Lucknow

60000 N 11. Cochin 40000 S

6. Calcutta

200000 E 12. Punjim 50000 W

We can put the respective city in respective region like west, east, south and north and put the first word of region against each city name. We now add potential users under W,E,S & N and represent as follows:

North Territory

West Territory

South Territory

East Territory

310000 480000 725000 250000

Conclusion: - Attitude formed is, south territory has highest potential.

Illustration (b) Godrej Agrovet have provided following data for it‟s „cattle feed‟ product Brand „Milk More‟. Construct Nominal scale.

District Region Sales per day in

Qtl.

District Region Sales per day in

Qtl.

1. Nagpur Vidharbha 300 7. Solapur

South Maharashtra

260

2. Akola Do 200 8. Baramati

Do 340

3. Wardha Do 400 9. Sangli Do 280

4. Aurangabad

Marathwada 150 10. Pune

Wet Maharashtra

500

5. Jalna Do 105 11. Nasik

Do 380

6. Parbhani Do 125 12. Satara

Do 400

Let us regroup region wise sales and rank them

Sr. No.

Regiona Total sale in Qtls. Per

day

Rank

1 Vidharbha 950 II

2 Marathwada 380 IV

3 South Maharashtra

880 III

4 West Maharashtra

1330 I

Conclusion: Attitude formed is Western Maharashtra Region is having highest sales potential.

(ii) Ordinal Scale: In marketing research, ordinal scales are used to ascertain consumer‟s perception on a brand, service, etc. Illustration a) Mobile user‟s brand preference for handset manufacturers Attribu

tes Light

weight

Price

Design / style

High technology

Battery life

Durability

Reliability

Voice

quality

Caring

company

Total

score in %

Nokia 99%

Sony Ericson

99%

Motorola

97%

LG 93%

Samsung

82%

Panasonic

80%

Philips 68%

Siemens

66%

Mitsubhishi

30%

Alcatel 13%

TCL 5%

Illustration (b): Microwave ovens manufactures wants to know the brand ranking perceived by customers. Design ordinal scale.

Attributes Price(10) Weight (10)

Antibacterial properties

(10)

Nutritive food (10)

After sales

service (10)

Total service out of

50

Rank

LG 9 9 10 10 10 48 1

BPL 8 8 8 8 8 40 4

Kenstar 10 10 7 8 10 45 3

Samsung 8 8 10 10 10 46 2

Electrolux 6 9 9 8 6 38 5

Panasonic 6 8 8 8 6 36 6

National 7 7 7 7 7 35 7

Whirlpool 7 7 7 7 7 35 7

Bajaj 8 7 10 10 10 45 3

(iii) Interval scale: In marketing research, this scale is used to measure intensity by which attitude towards a brand varies on any marketing stimuli. Illustration: (a) Mobile telephone users may express Nokia brand in follows: Global brand Nokia cellular is liked by me the most, I neither like nor dislike Nokia cellular, I dislike Nokia cellular, I dislike Nokia cellular the most. Illustration (b) Consumers want to express the tastes (likes / dislikes) of Pizzas and burgers supplied by Pizza Hut, McDonalds and domino Pizza. Design Interval Scale.

Attributes Like the most

Like Neither like nor Dislike

Dislike Dislike the most

P D M P D M P D M P D M P D M

Taste

Cheese Quality

Briskness

Thickness

Spice

Price

Conclusion: McDonald‟s Burgers is liked by most of the consumers. (Amul Pizza is not considered because only in Gujarat, it is served in ready to eat fashion whereas in other part of the country it is served in frozen condition, which requires further processing). (iv) Ratio scale: This scale is used to measure attitude on quantity sold, number of consumers, profitability, probability of purchase, etc. Illustration: (a) IT customers handled by the Telecom companies. – Number of IT consumers handled by Tata Indicom is one tenth of that handled by Reliance Infocom. Illustration (b) A automobile dealer wants to get knowledge on profitability on consumer base of hero Honda and TVS Victor. Design ratio scale:

Vehicle Quantity sold in

one year

Price /each in

Rs.

Total sale Rs.

Commission earned per

vertical

Total profit Rs.

Hero Honda Passion

230 46000 10580000 4000 920000

TVS Victor GL 205 45000 9525000 4500 922500

Conclusions:

(1) No. of consumers handled by Hero Honda Dealer are 1.12 times more than TVS victor dealer (2) Total profitability of TVS Victor dealer is 1.0027 times more than Hero Honda Dealer.

(v) Thurston scale: This is eleven point scale to express varying degree of attitude from unfavorable to favorable. B A F K C D E G H I J Unfavorable Neutral Favorable

Illustration (a) supposes a statement is made like, „Enron Power Project is beneficial to India‟; the response from the consumers, politicians and govt. could vary from 100% unfavorable to 100% favorable. Illustration (b) Design Thurston scale for „Saas-Bahu‟ TV serials being run on most of the prime channels (SCMHRD May 2005) Solution: Following statements (from A to K) could be made.

(a) All these Saas-Bahu serials build up negative value system by depicting disputes in the family.

(b) All Saas-Bahu serials portray an irrational depiction of characters.

(c) Telecast time of Saa-Bahu serials clashes with important programmes like News, etc.

(d) All Saas-Bahu serials are monotonous. (e) Most of the Saas-Bahu serials are complete

waste of time. (f) I have no positive or negative feelings about

Saas-Bahu serials, (g) Saas-Bahu serials provide good entertainment

after a hard days work.

(h) Most of the key characters of Saas Bahu serials become trend setters in respect to clothings, jewelry and other accessories.

(i) Most of the Saas Bahu serials bring the whole family together

(j) Saas-Bahu serials help to understand, analyse and solve the domestic crisis.

(k) The Saas-Bahu serials are a good ways to instill family values in terms of obedience& respect

(2) Compare rating and ranking scales (SCMHRD Dec. 2005) Solutions:

Rating Scale Ranking Scale

1. Attitude is measured from the point of view of intensity of the likes and dislikes

1. Attitude is measured from the point of view of intensity of preferring one product over other.

2. Interval data is needed 2. Ordinal data is needed

3. It is absolute 3. It is relative

4. Examples – Interval Scale 4. Example – Ordinal scale, Semantic differential scale

(3) Construct Likert Scale, Perceptual Map and Semantic Differential Scale (i) Likert Scale to study consumer satisfaction with tyre-brands

Score out of

+2 +1 0 -1 -2

Attributes Strongly Agree

Agree Neither agree nor Disagree

Disagree Strongly disagree

Cost friendly

Grip

Wear & tear

Rubber – quality

longevity

Brand Sign Score MRF 2+2+2+2+2 = 10 JK 2+1+2+1+2=8 Apollo 2+1+0+0+0=3 (ii) Semantic differential scale to understand the images in the mind of consumers for washing machine manufacturers

Remark Excellent

Better

Good

Average

Poor

More poor

Worst

Score +3 +2 +1 0 -1

Attributes W V LG Attributes

Progressive

Traditional

Reliable Unreliable

Strong Weak

Cust-focused

Non cust-focused

Responsive

Non response

Brand Sign Score Whirlpool W +3+2+2+3+2 = 12 Videoon V +2+2+3+2+2=11 LG LG +3+2+2+2+2=11 (iii) Following data is given for three Telecom companies. Prepare Semantic Differential Scale

Attributes Reliability Tangibility Responsiveness Assurance Empathy

RIM +3 +2 +1 +1 +1

BHARATI +3 +2 +2 +3 +3

TATA -2 -3 0 +1 +1

Solution :

+3 +2 +1 0 -1 -2 -3

Reliability

Tangibility

Responsiveness

Assurance

Empathy

Brand Sign Score RIM BA +3+2+1+1+2 = 9 Bharati BH +3+2+2+3+3=13 Tata TA -2-3+0+1+1=-3

Construct Semantic Differential scale for Management Institutes (Leading) in India

Attributes Excellent

Better

Good

Average

Poor

Very poor

Worst

+3 +2 +1 0 -1 -2 -3

Reputation

Success of placement

Quality of Placement

Infrastructure

Faculty

Teaching Methodology

Special Units

Admission eligibility

1) Reputation: High rank, tie up with foreign

Universities / Instt., admission tests are toughest, have international recognition, best aluminus

2) Success of placement: 100% placement, multiple placement option

3) Quality of placement: Abroad placement with MNCs, Average salary best among top „B‟ schools

4) Infrastructure: provides financial aids, convenient location, high standard hostel & mess, high speed internet facility, all class room with LCD, high class book library

5) Faculty: Well trained faculty, research done by faculties, visiting faculties from Industries

6) Teaching Methodology: Good counseling, student faculty ratio 1:1, industry interaction as part of syllabus

7) Special units: Known for marketing programme, known for mass media and finance programme

8) Admission eligibility: Students with work experience, only engineers

Scores for Leading Management Institutions: IIM = +3+2+2+2+2+2+1+1 = 15 ISB = +2+2+3+3+2+2+3 = 17 ICFAI = +2+1+2+2+2+1+2+1 = 13 SYMBI = 2 X 8 = 16 INDIRA = +1+2+1+2+2+2+1+0 = 11 (iv) Perceptional Map Following data is given on Indian Refrigerator Industry (Size 165 lit. to 180 lit.)

Brand Technology Price :Rs.

BPL Direct cool 9290

Godrej Do 8000

Kelvinator Do 9990

Samsung Do 8490

Whirlpool Do 9100

LG Do 9000

Electrolux Frost free 11000

Videocon Direct cool 8890

Allwyn Do 8290

Voltas Do 8110

Daewoo Frost free 10500

Prepare Perceptual map. Solution: Construction of Perceptual Map

LAST CHAPTER – APPLICATIONS OF MARKETING RESEARCH

Kelvinator

High price (Rs.)

Frost free Direct cool

Low Price

8000

8500

9000

9500

10500 #

11000 $

11500

12000

LG

BPL

Voltas

Samsung

Alwyn

Whirlpool

Gordrej

I. PRODUCT RESEARCH Product research areas

Marketing research techniques

(1) Formulating new product

Regression Technique, Benefit Analysis

(2) Product Line Extension / Brand Extension

Perceptual Map

(3) Test Marketing of new product

Experimental research design

(4) Re-launching of declining product

Qualitative Research or Perceptual mapping

CASE STUDY EXAMPLES

(a) Apartment on wheels (b) Makeup room on wheels (c) Hotel apartment (d) McKinney Electronic Toll Collection

Pass (ETCP) Product research would be also applicable to find out the reactions of consumers to manual cameras vs automatic cameras. In addition to

specific likes or dislikes of each product category, brand preferences within the category could form a part of the research. The objectives may be to find out what type of camera to launch and how strong the brand salience for the sponsor‟s brand is. Another product of research could be to find out from existing users of photocopiers (commercial and corporate), whether after sales service is satisfactory, whether spare parts are reasonably priced and easily available and any other service improvement ideas for instance, service contract, leasing options or buy-backs. II. PRICE RESEARCH Price research is done in following two situations

(B) When competitors product is available for comparison of the price. Coca cola, though startgin offering 300 ml at Rs. 7 as against Pepsi‟s 200 ml for Rs. 6, returned back to Rs. 5 for 200 ml to attract target market which was college going youth.

(C) Well competitors product is not available for comparison Dabour India Ltd. Launch lime juice (Lemoned). During launching similar product was not available for price comparison that is why it contacted target customer (50 housewives, 50 working women and 50 cooks)

(D) When price is the only benefit you are offering to targets, do not hide but hammer it. Cadbury Shweppes while launching sports cola and Canada dry offered 300 ml bottle at price Rs. 6 and communicated as follows:

Yehi hai Right Price Baby – Just 6 bucks Nothing expensive about it – Just 6 bucks

(E) International Distillers & Vinters Research wine and alcoholic beverage market and realize that 90% of the market exists below Rs. 250/-

price segment. As such it launch two pack sizes with brand names Green Lable & Old Gold price at Rs. 175 and Rs. 225 for 125 ml (these brands belong to green lable visky

Lesser if you cannot identify affordability (as done by coca cola and dabur) you may adopt the second route – largest possible customer segment.

III Distribution Research

Decision area Marketing research technique to be adopted

1) Selecting suitable channel option from two alternatives like direct Dsitribution or Indirect distribution

Indepth interviews, focus group studies, exploratory research

2) Performance Appraisal of two horizontal channel

Cluster analysis

partners (retailer vs retailer)

3) Encouraging or motivating channel members

Qualitative research or focus group studies

CASE STUDY EXAMPLE

(A) Nagaland Govt. Labhlaxmi Lottery (B) Playwin (C) Sundaram Fastners (D) Rebok India (E) How Bollywood producers invented 7

th

8th and 9

th channel of distribution for the

films * Application of Research to Bollywood. Why and how Bollywood producers invented new

channels of distribution for selling the films? a) Till 1992, if a movie was to recover just cost of

production + distribution + marketing; it would have stayed in theatres for 50 days. (Minimum 3 show per day, all over India)

b) The revenue earning ability of movies was not great because overall affordability of the society was weak. The balcony ticket during 1960-70 was Rs.1.50, which increased to Rs. 2.00 during 1970-80. It became Rs.20 by 1995 and then to Rs. 50 by 2005 for single screen cinema.

c) Given below production + marketing cost for a movie, decade-wise, as well as the revenue per territory for different viewerships.

(1) Production +Marketing cost for a movie – decade wise

Sr. No.

Decade Production + Marketing cost in Rs.

Cr.

Hit movies

1 60-70 Upto Rs.0.50 cr.

Dosti, Jangali Kasmir ki Kali, Aaradhana, Daag, Aarjoo, Farz, Suraj, Sangam, Upkar

2 70-80 Upto Rs. 0.75 cr.

Bombay to Goa, Janjeer, Bobby Hathi Mere Sathi, Amare Prem, Kati Patang, Deewar, Roti, Trishul, Don, Shole, Roti kapada Aur Makan, Pyarab-Paschim

3 80-90 Upto Rs. 1.25 Cr

Karma, Ram-Lakhan, Tejab, Dostana, Aakhir Rasta, Himmatwala, Tohafa

4 2001-2008

Upto Rs. 50 Cr.

Laggan, Koi Mil Gaya, Krish, Devdas, OSO, Welcome, K3G

(2) India‟s movie market is distributed in 6 territories.

Total 13,000 single screen theatres, in 6 territories entertain Indian Public. Till 1992, the revenue from movies was as follows:

Sr. No.

Decade Balcony ticket

Movie cost

Revenue (all India) Movie stays for

50 days

100 days

175 days

1 60-70 Rs. 1.50 Rs. 0.50 Cr.

0.48 0.65 0.80

2 70-80 Rs. 2.00 Rs.0.75 Cr.

0.74 0.90 1.10

3 80-90 Rs. 5.00 Rs.1.25 1.25 1.50 1.75

Cr.

4 90-2000 Rs.20.0 Rs.2.0 Cr.

2.05 2.35 2.60

5 2000-2008 Rs.50.0 Rs.10.0 Cr

100.0 170.0 250.0

(3) Comparison of Revenues before and after 1992

Revenue per week (fig. in Rs. Cr.)

Before 1992

After 1992 to 2000

Movie (single screen)

Various Rights

Total

50% viewership

0.035 0.29 0.15 0.44

90% viewership

0.070 0.60 0.15 0.75

d) Bollywood invented new channels of distribution, since 1992

Year Invention Example

1992 Music right Khalnayak - 0.75 cr), K.K.H.H. - 2.25, Mohabbatai – 7 Cr., Devdas -12 Cr.

1995 Export Rights

K.K.H.H. – 11.37 cr., Mohabbataien – 6.5 Cr., Dil to Pagal Hai – 6.4, Hum Aap Ke Hai Kaun, 4 Cr., Kaho Na Pyar Hai – 3.21 Cr., Laggan – 2.87 Cr., Mansoon Wedding – 60 Cr., Devdas – 12 Cr., Koi Mil Gaya & Krish – 10 Cr.

1997 DVD & Satellite

Kaho Na Pyar Hai – 2 Cr., Karan-Arjun – 0.50 cr., Krish & Koi Mil Gaya – 12 Cr., Murder – 20 Lakhs

e) Alter 2000, Multiplex mushroomed in India. As on

today i.e. June 2008, total 360 screens through 90 multiplexes are available for show-business. Now a movie can recover production + marketing cost in a week. Example: Movie Jannat released in June 2008,Singh is King,Rab Ne Bana Di Jodi&Gajni.

Cost All India Revenue in one week Remark

Single screen cinema

Multiplex Total

Jannat 5 cr. 14 cr. 2 cr. 16 Super Hit

IV ADVERTISING RESEARCH

Decision area Marketing research technique

1) Determining ad-objectives (which objective should be chosen)

Focus group interview, qualitative research

2) Evaluating ad-copy and ad-effectiveness

Experimental research deisgn

3) Deciding media Qualitative research 4) Advertising budgets Opinion poll,

qualitative research

In attention, advertising research is revolving around

(1) Copy (2) Media

CASE STUDY EXAMPLES

(A) Sales Promotion Campaign by Asian Paints

(B) Sales Promotion Campaign by BT, BW, A&M

V. CONSUMER BEHAVIOUR RESEARCH Consumer Behaviour and the factors that affect consumer buying behaviour can be very well studied through HYPOTHESIS TESTING. Following illustrations will focus on consumer behaviour and applications of marketing research: Illustration 1 Consumer Behaivour and Brand Extnesion Hypothesis Hypothesis 1 H0: The hypothesis of the study is that cultural differences do not have an impact on brand

extension across countries as well as states within a country like India. For example, people in the state of Tamil Nadu may have different consumer profile compared to that of Punjab and but might perceive and accept brand extensions in a similar way. Cultural differences do not have an impact on brand extensions. H1 : The alternative hypothesis is that cultural difference do have an impact on brand extensions and is very relevant in the Indian scenario. In fact, brand extensions judged to be a poor fit by U.S. respondents, such as Coke. Indian respondents perceived popcorn and McDonald‟s chocolate bars, much more positively. Hypothesis 2 Cultural differences will exist to the level of importance attached to individual product attributes. The hypothesis 1 and 2 were based upon the observation that, within a product category, different brands and/or products featuring

specific attributes often carry significantly different tags. Objective The objective of this study is to examine whether cross-cultural difference exist in consumer perceptions of the various attributes in brand extensions. Also we try to examine whether cultural differences will be stronger with extensions that are further away from the parent brand, which was referred to as “low fit” extensions. The brand extension selected were Coke Popcorn, McDonald‟s chocolate bar, Mercedes-Benz watch and Kodak greeting cards. To find out whether cultural differences will exist in the amount consumers would expect to pay for each product / brand extensions and the frequency of their buying. Another objective was to check whether cultural differences will exist in the level of importance attached to individual product attributes, like colour, taste, etc. Research methodology

A survey was conducted to study the impact of cultural differences on brand extensions in the Indian scenario. This was done by carrying out a market research on consumer responses to the various brands along with their extensions (listed) and which are parts of the FMCG sector. List

Kellogg‟s Bisucits / Kellogg‟s Cereals

Lux Soap / Lux Liquid Soap

Maggi Noodels / Nestle Chocolate

Nirma Detergent / Nirma Soap

Lipton Tea / Lipton Ice Tea Exploratory Research design was constructed to learn various stated and unstated needs of people w.r.t. brand and brand extensions. The questionnaire was formulated after interviewing 15 samples. The sample size selected for the main survey was a total of 90 respondents considering the time duration fo the project and it was felt that the sample size of 90 was substantial enough to represent the universe. The respondents

were typically the existing users of either of the various brands being mentioned. Almost 45% of Mumbai‟s population comprises of Maharashtra (the second most being Gujaratis) so care has taken to see that the sample comprises of similar percentage of maharashtrians. Hence the Western region sample size is more than 55% of the total sample size. Although the type of sampling used was convenience sampling, care was taken to ensure that the example was as diverse and representative a s possible by targeting respondents across the various cultures, income levels, education backgrounds, etc. so care was taken to ensure that people from different regions or states were considered. Similarly the survey had a greater mix of families, rather than individuals since they are more often the decision makers when it comes to buying such commodities. Analysis and Findings After collecting the data from the respondents, the data was complied and the analysis was done using SPSS. PREFERENCE OF

INDIAN AND FOREIGN BRANDS IN VARIOUS REGIONS. Independent sample test to check for variation in responses for preferred brands (Indian or Foreign) based on region and the significance level to be 0.05. it was found that the significance was observed to be greater than 0.05 thus proving that variation exists in the responses of consumers of various regions for Indian and Foreign brand preference. 75% of the respondents preferred buying Indian brands to foreign brands and this was seen on an overall basis even though, brands mentioned except Nirmal are foreig