Application of Marketing Research

Application of marketing research can be divided into two broad areas

• Strategic
• Tactical

Among the strategic areas, marketing research applications would be demand forecasting, sales forecasting, segmentation studies, identification of target markets for a given product, and positioning strategies identification.

In tactical application, we would have applications such as product testing, pricing research, advertising research, promotional research, distribution and logistics related research. In other words, it would be include research related to all the P’s of marketing: how much to price the product, how to distribute it, whether to package it in one way or another, what time to offer a service, consumer satisfaction with respect to the different element of the marketing mix (product, price, promotion, distribution), and so on. In general, we would find more tactical application than strategic applications because these areas can be fine-tuned more easily based on the marketing research findings. Obviously, strategic changes are likely to be fewer than tactical changes. Therefore, the need for information would be in proportion to the frequency of changes

The following list is a snapshot of the kind of studies that have actually been done in India.

• A study of consumer buying habits for detergents-frequency, pack size, effect of promotion, brand loyalty and so forth.
• To find out the potential demand for ready-to-eat chapattis in Mumbai City.
• To determine which of the three proposed ingredients- tulsi, coconut oil or neem, the consumer would like to have in toilet soap.
• To find the effectiveness of the advertising campaign for a car brand.
• To determine brand awareness and brand loyalty for a branded PC.
• To find the customer satisfaction level among consumers in choosing a brand cellular phone handset.

As the list shows, marketing research tackles a wide variety of subjects. The list is only indicative, and the applications of marketing research in reality can be useful for almost any major decision related to marketing.

Some Other Application of Marketing Research

Concept Research: During a new product launch, there would be several stages-for example, concept development, concept testing, prototype development and testing, test marketing in a designated city or region, estimation of total market size based on the test marketing, and a national rollout or withdrawal of the product based on the results.

The first stage is the development of a concept and its testing. The concept for a new product may come from several sources

The idea may be from a brain-storming session consisting of company employees, a focus group conducted among consumers, so the brainwave of a top executive. Whatever may be its source; it is generally researched further through what is termed as concept testing.

A concept test takes the form of developing a description of the product, its benefits, how to use it, and so on, in about a paragraph, and then asking potential consumers to rate how much they like the concept, how much they would be wiling to pay for the product if introduced, and similar questions.

Product Research: Apart from product concept, research helps to identify which alternative packaging is most preferred, or what drives a consumer to buy a brand or product category itself, and specifics of satisfaction or dissatisfaction with elements of a product. These days, service elements are as important product features, because competition is bringing most products par with each other.

An example of product research would be to find out the reactions of consumers to manual cameras versus automatic cameras. In addition to specific likes or dislikes for each product category, brand preference within the category could form a part of the research. The objective may be to find out what type of camera to launch and how strong the brand salience for the sponsor’s brand is.

The scope of product research is immense, and includes products or brands at various stages of the product life cycle – introduction, growth, maturity and decline. One particularly interesting category of research is into the subject of brand positioning. The most commonly used technique for brand- positioning studies (though not the only one) is called Multidimensional Scaling.

Pricing Research: Pricing is an important part of the marketing plan. In the late nineties in India, some interesting changes have been tried by marketers of various goods and services. Newer varieties of discounting practices including buy-backs, exchange offers, and straight discounts have been offered by many consumer durable manufacturers. Most FMCG manufacturers/ marketers of toothpaste, toothbrush, toilet soap, and talcum powder have offered a variety of price-offs or premium-based offers which affect the effective consumer price of a product.

Price research can delve into questions such as appropriate pricing levels from the customers’ point of view, or the dealer’s point of view. It could try to find out how the current price of a product is perceived, whether it is a barrier for purchase, how a brand is perceived with respect to its price and relative to other brands’ prices (price positioning). An interesting area of research into pricing has been determining price elasticity at various price points for a given brand through experiments or simulations.

Distribution Research: Most marketing research focuses on consumers or buyers. Sometimes this extends to potential buyers or those who were buyers but have switched to other brands. But right now there is a renewed interest in the entire area of logistics, supply chain and customer service at dealer locations. There is also increasing standardization from the point of view of brand building, in displays at the retail level, promotions done at the distribution of products including service levels provided by current channels, Frequency of salespeople visits to distribution points, routing/ transport related issues for deliveries to and from distribution points throughout the channel, testing of new channels, channel displays, linkages between displays and sales performance.

Advertising Research

The two major categories of research in advertising are:

• Copy
• Media

Copy Testing: It include research into all aspects of advertising-brand awareness, brand recall, copy recall (at various time periods such as say after recall, week after recall), recall of different parts of the advertisement such as the headline for prints ads, slogan for TV ads, the star in an endorsement and so on. Other application include testing alternative ad copies (copy is the name given to text or words used in the advertisement, and the person in the advertising agency responsible for writing the words is known as the copy writer) for a single ad, alternative layouts ( a layout is the way all the element of the advertisement are laid out in a print advertisement) with the same copy, testing of concepts or storyboards ( a storyboards is a scene-by-scene drawing of a TV commercial which is like a rough version before the ad is actually shot on film) of TV commercials to test for positive /negative reactions, and many others.

A particular class of advertising research is known as Tracking Studies. When advertising campaign is running, periodic sample surveys known as tracking studies can be conducted to evaluate the effect of the campaign over a long period of time such as six month or one year, or even longer. This may allow marketers to alter the advertising theme, content, media selection or even longer. This may allow marketers to alter the advertising theme, content, media selection or frequency of siring /releasing advertisement and evaluate the effects. As opposed to a snapshot provided by a one-time survey, tracking studies may provide a continuous or near continuous mechanism. But here, one should be careful in assessing the impact of the advertising on sales, because other factors could change along with time.

Media Research: The major category under this category is research into viewership of specific television programmes on various TV channels. There are specialize agencies like A.C. Nielsen worldwide which offer viewer ship data on a syndicated basis (i.e., to anyone who wants to buy the data). In India, both ORG-MARG and IMRB offer this service. Research could also focus on print media and their readership. Here again, readership surveys such as the National Readership Survey (NRS) and Indian Readership survey (IRS) provided syndicated readership data.

Media research can also focus on demographic details of people reached by each medium, and also attempt to correlate consumption habits of these groups with their media preference. Advertising research is used at all stages of advertising, from conception to release of ads, and thereafter to measure advertising effectiveness based on various parameters.

Limitation of Marketing Research

Now let’s have a look on the limitation of marketing research. You would be surprised that how a helping hand has limitations. As marketing research can be extremely rewarding to a firm, it is wise to know that it is subject to certain limitations. One must be aware of these limitations in advance so that one is clear about what marketing research can and cannot do.

• Marketing research tends to be fragmentary in its approach as a result of which it becomes difficult to have an overall perspective in which a marketing problem is to be viewed and studied.
• Marketing research is criticized on the ground that it becomes too superficial and faculty in industry. While the principles of marketing research are good and based on scientific lines, in industry, marketing research is very often used by those who have had no formal training in the subject. Such person avoids using detailed investigations and sophisticated techniques which require both time and patience on the part of marketing researchers.
• There is an absence of a meaningful dialogue between the marketing management and the marketing research team. As a result, marketing researchers get divorced form the main stream of marketing. This denies them any opportunity to test their finding in the practical marketing situation.
• Marketing research is not an exact science. There are several imponderables which come in the way of getting accurate results. For example, consumer behaviour is an area which is rather elusive and the theory does not go very far in disclosing it very precisely. Analytical tools of marketing research are still deficient and cannot give us a precise idea, especially on the behavioural aspects.