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Module 4 Notes

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MKT 100
Paul Finlayson

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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