Marketing Research

M a r ke t Se g m e n t a t ion & Br a n d Posit ion in g Market Segmentation is the process by which the total heterogeneous market is sub divided into several sub-markets or segments  Each segment is homogeneous in all major aspects & is different from the other 

1

Bases for Market Segmentation Demographic- Region, States, Districts, City Size, Density, Climate, Age, Sex, Family Size, Income, Occupation, Education, Religion, Social Status  Psychographic- Life Style, Personality  BehaviouristicUser Status, Usage Rate, Benefits Sought, Readiness Stage  Brand-related AttitudeBrand Perceptions, Brand Preferences 

2

Requirements of Effective Market Segmentation 1. The bases for segmentation 2. It is necessary that market segment is available 3. The market should be segmented such that the segment is large enough for the company to have adequate sales & profits

3

Target Marketing 1.Differentiated 2.Concentrated 3.Undifferentiated

4

Brand Positioning deals with measuring the perceptions that buyer hold about alternative offerings.  Reflects the essence of a brand as perceived by the target consumer in relation to other brands.  Components of positioning

It

1. The product class or structure of the market in which a company s brand will compete 2. Consumer segmentation 3. Consumer perception of the brand in relation to the competitors brand 5 4. Benefit offered by the company’s brand

Techniques for perpetual mapping 1.Image Profile analysis 2.Factor Analysis 3.Cluster Analysis 4.Multidimensional Scaling

6

Image Profile Analysis Cleaning Abilit y

5

1

Color Prot ect ion

Reasonable Price

7

Integration of market Segmentation & brand positioning

8

Multivariate Analysis It is the analysis of the simultaneous relationships among three or more phenomena  The focus shifts from paired relationships to the more complex simultaneous relationships among phenomena. 

9

Multivariate AnalysisClassification  Inter-dependence

› › › ›

Methods

Factor Analysis Cluster Analysis Multidimensional Scaling Conjoint Analysis

 Dependence

Methods

› Multiple Linear Regression › Non-Linear Regression › Discriminant Analysis

10

Factor Analysis 

Objectives1. It simplifies the data by reducing a large number of variables to a set of small number of variables 2. It analyses the interdependence of interrelationship among a total set of variables



Usefulness›

›

Bring out the hidden dimensions relevant in the relationship among product preferences. Sometimes, the product characteristics influencing the consumer preferences are not clear . In such cases, factor analysis can be helpful by revealing more important characteristics of the product To find out certain relationships among observed values which , though exit, are obscure. 11

Applications of Factor Analysis  Data

Reduction  Structure Identification  Scaling

12

Example of Factor Analysis  Coffee-

To Identify major factors for determining consumers evaluation of a brand of coffee. (14 taste attributes)

13

Limitation of Factor Analysis 1.Not strongly supported by statistical methods 2.The different result can be obtained by loading factors in different manners 3.A large number of attributes required to study factor analysis 4.Sometimes complex factors are used which respondents find difficult to understand 14

Cluster Analysis

Vacation Days

.. . .

.. . . .. . .

Expenditure on Vacations

15

Matching Measures

Object A B

Attributes 1 2 1 0 1 0

3 0 1

4 1 1

5 0 1

SAB = M/N SAB= Similarity between A&B M= # of common attributes N= Total # of attributes

16

Uses of Cluster Analysis 1. Market Segmentation 2. Better understanding of Buying Behaviour 3. Development of new product 4. To identify homogeneous test market 5.

17

Methods of Cluster Analysis 1. Hierarchical Method (Unstable & unreliable) › ›

Top Down Bottom-up

2. Non-hierarchical Method (Reliable but difficult) 3.

18

Con-Joint Analysis It is concerned with the measurement of the joint effect of two or more attributes that are important from view point of the consumer  Involves three steps

› Identification of the relevant product

or service attributes-- Direct interviews, Ascertaining data from knowledgeable person › Collection of data- Trade-off approach or full profile approach (rank) › Estimation of part-worthy utility function – statistical method, computerized 

E.g. Airline

19

Multi dimensional Scaling (MDS)

20

Test Marketing  It

is a controlled experiment, done in a limited but carefully selected part of market place, whose aim to predict the sales or profit consequences, either in absolute or relative terms, of one or more proposed marketing actions. It is essentially the use of the marketplace as a laboratory & of a direct sales measurement which differentiates this test from other types of MR 21

Uses of Test Marketing 1.Test marketing as a Managerial tool › Pilot Operation › Improves mechanics of the operation › E.g. storage, handling, stocking 2.Test marketing as a Predictive Research Tool › Intro of New Product › Evaluation of alternative marketing

variables

22

Test Marketing for new product or brand  To

know expected sales & profits 1.Buying Income method  Estimate of national sales= (Total country income/Test area income)x Test area sales

2.Sales ratio Method Estimate of national sales= (National sales of other product/Test area sales of this other product)x Test area sales of test product

3.The share-of-market method Estimate of national sales= (Test area sales of new brand / Test area sales of this whole product 23

Evaluation of alternative marketing variables  To

find whether a new media pattern is better than the existing one

24

When to test Market 1. A product with low cost & risk do not need it 2. Investment in plant 3. Responsiveness of the competitors 4. Considering the impact of test market failure

25

Guidelines for designing Market Test

1.Test market should be representative of whole 2.Time at least one year 3.Market must be carefully controlled 4.Ensure that it will give accurate result- measurement & methods 5.Advisable to test one variable at a time 6.Projections made should be realistic 7.Desirable to undertake basic MR 

26

Overseas Marketing Research  Why

› › › › › › ›

Export-

Surplus Capacity Home market saturation Home market competition Improve Quality To become multinational Tax exemption New product development to suite export 27

Problems of Export Marketing Research 1.Need to Analyze several markets rather than one market 2.Reliability of secondary data 3.Collection of primary data 4.If survey need to cover 2-3 countries then it is difficult compare data 5.Availability of Media 6.Religious & cultural customs vary from country to country 28

Organizing Export MR  Own

Staff  Importing Agents  Domestic marketing research company  Service of various research agencies

29

Information Requirement of International Marketers  Market

Information  Product Information  Promotional Information  Distribution Information  Price Information  Environment Information  General Research Information› General- community, business

condition, lifestyle, economic condition › Industry Info › Study related Info 30

 Use

of secondary data- WTO, World Bank Periodicals  Collection of Primary Data (Field Survey)› Product Oriented › Market Oriented › Need for personal visit

31

Error in International Surveys  Definitional  Instrument  Frame

Error  Selection Error  Non-response error  Sampling error

32

Advertisement Research  Need

–

› To decide clear objective of › › › ›

advertisement To develop marketing strategy Selection of Target audience Evaluation of advertising It can be instrumental in increasing the efficiency of ad

33

Media Research 

Main Issues› How to choose amongst media types? › How to decide on a specific insert within

particular media type



To answer this following type of data is required› Media Vehicle Distribution– e.g. Circulation › Media Vehicle Audience- # of people › › › ›

exposed Advertising Exposure Ad perception Ad communication Sales Response

34

Media Audiences  Media

Research comprises , inter alia, the measurement of the size & break up of individual vehicle audiences. These can be discussed under two heads › Print Media › Radio & Television Coincidental MethodDirect Telephone Calling ( Quick & Economical) Roster Recall– personally asked Diary Method-The Audimeter 35

Copy Testing  The

word ‘copy’ is used to denote an entire advertisement  Methods of Copy testing › Before Test Methods › After Test Methods

36

Before Test Methods 1. Consumer Jury– Rough ads shown to consumer & asked about feedbacks 2. Rating Scales- rated on scale value 3. Portfolio tests– Placed in dummy magazine & recalling will be asked 4. Psychological tests- Interview & story telling to respondent through psychologists 37

5. Laboratory testing– Mechanical device to measure respondent's psychological response to a given ad 6. Inquiry tests- same offer, different ad (copy), different issues 7. Simulated sales tests- two similar store, two alternative copy display at POP. 8. Day-after recall tests 9. 38

After Tests Methods  Recognition

Tests– For print media, respondents are asked about the ad. Response is measured in Noted, seen associated & Read Most  Recall Tests  Sales Tests

39

Multidimensional Scaling  It

is the class of procedure for representing perceptions & preferences of respondents by means of visual display.  Uses› The number & nature of dimensions

consumers use to perceive different brands in the market place › The position of current brands on these dimensions › The position of consumers’ ideal brand on these dimensions 40

Approaches to Multidimensional Scaling  Attribute

Based  Non-attribute Based

41

Non-attribute Based Preferred Brand Surf Sunlight Gnat Key

Preferred To Surf -25 10 0

Sunlight 25 -15 5

Gnat 40 35 -20

Key 50 45 30 --

42

 Converted

to matrix of similarity using

formula  Sij = (Rij x Rji) / N › where Sij= Matrix of similarity between i & j brands › Rij = number of respondents preferred brand i over j › Rji = number of respondents preferred brand j over I › N= total respondent › › 43

S=

S=

Surf Sunlight Gnat Key

Surf Sunlight Gnat Key

Surf -----

Surf -----

Sunlight 12.5 ----

Sunlight 1 ----

Gnat 8 10.5 ---

Gnat 4 3 ---

Key 0 4.5 12.0 --

Key 6 5 2 --

44

Limitation of MDS 1. The concept of similarity & preferences are not very clear. As such the respondents perception of both factors may vary 2. There are empirical limitationsattributes are subjective to respondents 3. Difficult to interpret results

45