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Chapter

Module 4 Notes

9 Pages
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Department
Marketing
Course Code
MKT 100
Professor
Paul Finlayson

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Module 4: Understanding Buyer Behaviour
Section 1: Researching Customers
Microeconomics, Private Information: states that a firm profits from unique
information and insights it has about production techniques and trade secrets
Info about customer behaviour can be a powerful driver of competitive success and
profitability
Most important consumer research activity of a current business si to track customer
staisfation and dissatisfaction
Tracking returns and customer complaints
Firms also undertake special consumer research studies to test product concepts in
new product development, global markets
Market research process:
oProblem Definition/ Question to be Answered
oResearch Design
oData Collection
oData Analysis and Interpretation
oPresentation of Results
Types of Research
Exploratory research: undertaken when the problem or research question is still
fuzzy and management want additional information before undertaking further
research
oUses internal records, customer complaints
Descriptive survey research: used to describe customers, either small numbers of
customers in-depth or large numbers of customers by survey research
oAnswers who, what, here, when, and why
Cross-sectional research: studies a cross sectional sample of customer responses
at a specific point in time
www.notesolution.com
Longitudinal research: involves the repeated measurement of the same customer
and addresses customer responses over a period of time
Cause and effect research: used to explore the question Does X cause Y?
Section 2: Qualitative Consumer Research
Qualitative
oObservation
oIn-depth Interviews with customers, supplier and middlemen
Ethnography: The way of life with people
Sometime voice of customer separate from decisions, organization less market
oriented
Customer Visits
Dont confuse customer visit with a sales call
Dont go behind back of sales
10 to 20 randomly chosen customers
Listen to customer
Avoid changing subject
Observe product in use in every usage situation
2 or 3 team members make the visit together
Focus Group Research
Most common market research method used today
Consists of 6 to 12 carefully selected people who focus on a particular question or
issue in a free-wheeling discussion for about 2 hours
Involve an independent moderator
Steps to remember
oIdentify who you want to talk to (expect to pay 50-100 a person)
www.notesolution.com
oChoose a moderator that will relate to focus group people
oDebrief mod
oLook at body language as well
oHave management in attendance
oConduct focus group until no new insights surface
oRun focus groups with experts
Section 3: Survey Consumer Research
Descriptive research far more common in business than cause and effect
experimental research
To see the whole population, can use a sample
Probability Sampling
Probability sample: sample where all the respondents in the population or
segment to be studied have a known (non-zero) chance of being chosen to be in the
sample from the population/ segment being studied
Are profitable customers satisfied?
Generated through computer programs
400-1000 participants
Advantage, reduce the potential for sampling error showing up in the results
Increased precision larger sample gives
Takes four times the sample size to double the precision
Draw random sample from customer database
Generally, use a market research company panel mix of users and non-users
Omnibus survey: where several firms participate in a survey
Convenience sample: sample that is gathered from a convenient pool of customers
or potential customers
Sampling Problems
www.notesolution.com

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Description
Module 4: Understanding Buyer Behaviour Section 1: Researching Customers • Microeconomics, Private Information: states that a firm profits from unique information and insights it has about production techniques and trade secrets • Info about customer behaviour can be a powerful driver of competitive success and profitability • Most important consumer research activity of a current business si to track customer staisfation and dissatisfaction • Tracking returns and customer complaints • Firms also undertake special consumer research studies to test product concepts in new product development, global markets • Market research process: o Problem Definition/ Question to be Answered o Research Design o Data Collection o Data Analysis and Interpretation o Presentation of Results Types of Research • Exploratory research: undertaken when the problem or research question is still fuzzy and management want additional information before undertaking further research o Uses internal records, customer complaints • Descriptive survey research: used to describe customers, either small numbers of customers in-depth or large numbers of customers by survey research o Answers who, what, here, when, and why • Cross-sectional research: studies a ‘cross sectional’ sample of customer responses at a specific point in time www.notesolution.com • Longitudinal research: involves the repeated measurement of the same customer and addresses customer responses over a period of time • Cause and effect research: used to explore the question “Does X cause Y?” Section 2: Qualitative Consumer Research • Qualitative o Observation o In-depth Interviews with customers, supplier and middlemen • Ethnography: The way of life with people • Sometime voice of customer separate from decisions, organization less market oriented Customer Visits • Don’t confuse customer visit with a sales call • Don’t go behind back of sales • 10 to 20 randomly chosen customers • Listen to customer • Avoid changing subject • Observe product in use in every usage situation • 2 or 3 team members make the visit together Focus Group Research • Most common market research method used today • Consists of 6 to 12 carefully selected people who focus on a particular question or issue in a free-wheeling discussion for about 2 hours • Involve an independent moderator • Steps to remember o Identify who you want to talk to (expect to pay 50-100 a person) www.notesolution.com o Choose a moderator that will relate to focus group people o Debrief mod o Look at body language as well o Have management in attendance o Conduct focus group until no new insights surface o Run focus groups with experts Section 3: Survey Consumer Research • Descriptive research far more common in business than cause and effect experimental research • To see the whole population, can use a sample Probability Sampling • Probability sample: sample where all the respondents in the population or segment to be studied have a known (non-zero) chance of being chosen to be in the sample from the population/ segment being studied • Are profitable customers satisfied? • Generated through computer programs • 400-1000 participants • Advantage, reduce the potential for sampling error showing up in the results • Increased precision larger sample gives • Takes four times the sample size to double the precision • Draw random sample from customer database • Generally, use a market research company panel mix of users and non-users • Omnibus survey: where several firms participate in a survey • Convenience sample: sample that is gathered from a convenient pool of customers or potential customers Sampling Problems www.notesolution.com • Risk of non-response error or participation bias • Participation bias: occurs when a particular customer group is under or overrepresented in a sample • General problem, household are tired of being duped by sales pitches that pretend to be a market research study • Sugging: selling under the guise of research Online Research • Customer review sites and across social networking sites • Third of all market research online o Increases quality of research (taking right from web, no errors in the data) o Reduced the cost of research 20-50 % o Sped up the market research process o Open ended responses online more detailed than the ones in mail or telephone • 20% of Canadians do not use internet • Must control who participates in online research, question checks (so child won’t be doing something for the head of a household) Section 4: Cultural and Social Influence • Cultures: the sum total of the ways living built up by a group of human beings and transmitted from one generation to another, behaviours and beliefs of a particular social, ethnic, or age group Canadian Culture • Canada embraces multiculturalism and rejects cultural homogeneity • Canada is a large country comprised of distinct ethnic and geographical markets • Asian Canadians are the fastest growing visible ethnic minority in Canada • Most obvious and unique regional market in Canada is found in Quebec www.notesolution.com • The most unemployment in Jan 2009 found in the Maritimes Drivers of Cultural Change • “Openness to foreign ideas is the single most important source of new technology and skills in developing countries’ • Nostalgia for the old culture can be used by marketers (ex at xmas time, happy memories) • Major agent of change in North American Family, employment and social emancipat
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