CHAPTER 8

Marketing Research & Sales Forecasting

MARKETING RESEARCH FUNCTION

Focus on determining: – market potential– market share– market characteristics

Classification of market research companies

Syndicated services: give info to all customers

Full service suppliers: performs all research

Limited service suppliers: parts of research

MIS: Marketing Information Systems MDSS (Marketing Decision Support

System)– computer software that helps users obtain & use

info to make marketing decisions

6 Steps in Marketing Research

1. PROBLEM DEFINITION– is it a symptom or a problem?

Ex. Our sales are down.

“Well Defined Problem is Half Solved”

2. EXPLORATORY RESEARCH Investigate

3. FORMULATE HYPOTHESIS – tentative explanation for some event

4. RESEARCH DESIGN – Master plan to get a direct test of the hypothesis

5. DATA COLLECTION– Secondary Data: less time and money but

could be obsolete or irrelevant– Primary Data: detailed, exact, valid but costly

and time consuming

How to Collect Primary Data

1. Observational method: watch people2. Survey method

– Telephone interviews: cheap & convenient bias to people who have phones

– Mail surveys: cost effective & anonymous but returns are very low

– Fax surveys– Personal interviews: good method

most time consuming & expensive mall intercepts good alternative

– Computer interviews faster gathering & analysis of data respondents may be more truthful than face to face very biased to computer users

– Focus group interviews 8 to 12 people brought together to discuss a subject

of interest

SAMPLING TECHNIQUES

one of the most important aspects of marketing research, if sample wrong - results will be wrong

CLASSIFICATION OF SAMPLES

1. Probability Sample each member has an equal chance of being selected

2. Nonprobability Sample arbitrary ones not subject to statistical tests

6. Interpretation and Presentation– clear, concise reports directed to management,

not other researchers

QUALITATIVE FORECASTING– subjective sales forecasts - based on opinions

not historical fact

1. JURY OF EXECUTIVE OPINION-combines & avg outlooks of top company executives

2. DELPHI TECHNIQUE seeks opinion of experts outside the firm & used to

predict long-term issues

3. SALESFORCE COMPOSITE what do the salesforce believe (Bottom up

approach)

4. SURVEY OF BUYER INTENTIONS mail in questionaires, telephone polls, & personal

interviews

QUANTITATIVE FORECASTING– more scientific approach

1. MARKET TESTS gauge consumer responses to a new product

2. TREND ANALYSIS analyze historical relationship btw sales & time

3. EXPONENTIAL SMOOTHING– more sophisticated trend analysis that assigns a

weight factor to each year of sales data