Certified Marketing Analyst CMA Module 5 The Basic of Market ...

By:

Suwiro Heriyanto

Certified Marketing Analyst

Module 5:

The Basic of Market Research

Market Research

• A systematic and organized effort to investigate a specific problem encountered in the work setting, which needs a

solution.

• It comprises a series of steps that are designed and executed with the goal of finding answers to the issues that are of

concern to the manager in the work environment.

− The first step in research is to know where the problem areas exist in the organization, and to identify as clearly and

specifically as possible the problems that need to be studied and resolved.

− Once the problem is clearly defined, steps can be taken to determine the factors that are associated with the problem,

gather information, analyze the data, develop an explanation for the problem at hand and then solve it by taking the

necessary corrective measures.

• The entire process by which we attempt to solve problems is called research. Thus, research involves a series of

well‐thought‐out and carefully executed activities that enable the manager to know how organizational problems can be

solved, or at least considerably minimized.

• In essence, research provides the necessary information that guides managers to make informed decisions to

successfully deal with problems.

• The information provided could be the result of a careful analysis of primary data gathered first‐hand or of secondary

data that are already available (in the company, industry, archives, etc.).

Business Research

10/14/2021 Please insert footnote2

Market Research

• A theory is any concept, instrument, model, or framework that helps them to think about or solve a problem, to describe

a phenomenon, or to better understand a topic of interest, such as competitive advantage, portfolio management, or

sociology.

• To a scientist, a theory explains a certain phenomenon, and the idea is that this explanation will hold in a wide range of

settings.

− For instance, expectancy theory proposes that people will choose how to behave depending on the outcomes they

expect as a result of their behavior.

− In other words, people decide what to do based on what they expect the outcome to be.

− At work, for example, it might be that people work longer hours because they expect an increase in pay.

• Like this, a theory may generate testable – and sooner or later, tested – predictions.

The role of theory and information in research


Market Research

Applied research: to solve a current problem faced by the manager in the work setting, demanding a timely solution.

For example, a particular product may not be selling well and the manager might want to find the reasons for this in

order to take corrective action.

Basic, fundamental, or pure research: to generate a body of knowledge by trying to comprehend how certain

problems that occur in organizations can be solved.

The findings of such research contribute to the building of knowledge in the various functional areas of business; they

teach us something we did not know before. Such knowledge, once generated, is usually later applied in

organizational settings for problem solving.

Types Of Business Research


Market Research

Managers with knowledge of research have an advantage over those without.

Research helps to understand, predict, and control events that are dysfunctional within the organization.

For example, a newly developed product may not be “taking off,” or a financial investment may not be “paying off ” as

anticipated.

Such disturbing phenomena have to be understood and explained.

Unless this is done, it will not be possible to predict the future of that product or the prospects of that investment, and

how future catastrophic outcomes can be controlled.

A grasp of research methods enables managers to understand, predict, and control their environment.

Why managers need to know about research


Market Research

Ethics in business research refers to a code of conduct or expected societal norms of behavior while conducting

research.

Ethical conduct applies to the organization and the members that sponsor the research, the researchers who

undertake the research, and the respondents who provide them with the necessary data.

The observance of ethics begins with the person instituting the research, who should do so in good faith, pay

attention to what the results indicate, and, surrendering the ego, pursue organizational rather than self‐interests.

Ethical conduct should also be reflected in the behavior of the researchers who conduct the investigation, the

participants who provide the data, the analysts who provide the results, and the entire research team that

presents the interpretation of the results and suggests alternative solutions.

The treatment of subjects and how confidential information is safeguarded are all guided by business ethics.

Ethics and Business Research


Market Research

1. Identify a broad problem area: A drop in sales, frequent production interruptions, incorrect accounting results,

low‐yielding investments, disinterestedness of employees in their work, customer switching, and the like, could attract the

attention of the manager and catalyze the research project.

2. Define the problem statement: Scientific research starts with a definite aim or purpose. To find solutions for identified

problems, a problem statement that includes the general objective and research questions of the research should be

developed.

3. Develop hypotheses: In this step, variables are examined to ascertain their contribution or influence in explaining why

the problem occurs and how it can be solved. The network of associations identified among the variables is then

theoretically woven, together with justification as to why they might influence the problem.

4. Determine measures: Unless the variables in the theoretical framework are measured in some way, we will not be able

to test our hypotheses. To test the hypothesis that unresponsive employees affect customer switching, we need to

operationalize unresponsiveness and customer switching.

5. Data collection: After we have determined how to measure our variables, data with respect to each variable in the

hypothesis need to be obtained. These data then form the basis for data analysis.

6. Data analysis: In the data analysis step, the data gathered are statistically analyzed to see if the hypotheses that were

generated have been supported.

7. Interpretation of data: Now we must decide whether our hypotheses are supported or not by interpreting the meaning

of the results of the data analysis.

The Hypothetico-Deductive Method


Market Research

• In the management and behavioral areas, it is not always possible to conduct investigations that are 100% scientific, in

the sense that, unlike in the physical sciences, the results obtained will not be exact and error‐free.

• This is primarily because of difficulties likely to be encountered in the measurement and collection of data in the

subjective areas of feelings, emotions, attitudes, and perceptions.

• These problems occur whenever we attempt to measure abstract and subjective constructs.

• Difficulties might also be encountered in obtaining a representative sample, restricting the generalizability of the

findings.

• Thus, it is not always possible to meet all the hallmarks of science in full.

• Still, to the extent that the research is designed to ensure purposiveness, rigor, and the maximum possible testability,

replicability, generalizability, objectivity, parsimony, and precision and confidence.

Some obstacles to conducting scientific research in the management area


Market Research

• View science and scientific research is seen as the way to get at the truth

• View that the world operates by laws of cause and effect that we can discern if we use a scientific approach to research.

• Concerned with the rigor and replicability of their research, the reliability of observations, and the generalizability of

findings.

• Use deductive reasoning to put forward theories that they can test by means of a fixed, predetermined research design

and objective measures.

• The key approach of positivist researchers is the experiment, which allows them to test cause‐and‐effect relationships

through manipulation and observation.

Alternative Approaches To Research: Positivism


Market Research

• Criticizes the positivist belief that there is an objective truth.

• View that namely that the world is fundamentally mental or mentally constructed.

• Constructionists do not search for the objective truth.

• Instead, they aim to understand the rules people use to make sense of the world by investigating what happens in

people’s minds.

• Emphasizes how people construct knowledge; it studies the accounts people give of issues and topics and how people

get to these accounts.

Alternative Approaches To Research: Constructionism


Market Research

A combination of the belief in an external reality (an objective truth) with the rejection of the claim that this external reality

can be objectively measured; observations (especially observations on phenomena that we cannot observe and measure

directly, such as satisfaction, motivation, culture) will always be subject to interpretation.

The critical realist is thus critical of our ability to understand the world with certainty.

The critical realist also believes that researchers are inherently biased.

Use triangulation across multiple flawed and erroneous methods, observations, and researchers as the approach to get a

better idea of what is happening around us.

Alternative Approaches To Research: Critical realism


Market Research

Focus on practical, applied research where different viewpoints on research and the subject under study are helpful

in solving a (business) problem.

Describes research as a process where concepts and meanings (theory) are generalizations of our past actions

and experiences, and of interactions we have had with our environment.

Views the current truth as tentative and changing over time.

Pragmatists stress the relationship between theory and practice: theory is derived from practice and then applied

back to practice to achieve intelligent practice.

Along these lines, pragmatists see theories and concepts as important tools for finding our way in the world that

surrounds us.

The value of research lies in its practical relevance; the purpose of theory is to inform practice.

Alternative Approaches To Research: Pragmatism


Market Research

• A “problem” does not necessarily mean that something is seriously wrong with a current situation that needs to be

rectified immediately.

• A problem could also indicate an interest in an issue where finding the right answers might help to improve an existing

situation.

• Thus, it is fruitful to define a problem as any situation where a gap exists between an actual and a desired ideal state.

• Examples of problems that the manager may encounter in the work setting are:

− Long and frequent delays lead to much frustration among airline passengers. These feelings may eventually lead to

switching behavior, negative word‐of‐mouth communication, and customer complaints.

− Staff turnover is higher than anticipated.

− The current instrument for the assessment of potential employees for management positions is imperfect.

− Minority group members in organizations are not advancing in their careers.

− The newly installed information system is not being used by the managers for whom it was primarily designed.

− The introduction of flexible work hours has created more problems than it has solved.

− Young workers in the organization show low levels of commitment to the organization

Defining and refining the problem


Market Research

• It is very important that symptoms of problems are not defined as the real problem.

• To avoid the depth of impact the issues caused to a company.

− For instance, a manager might have tried to decrease employee turnover by increasing wages, but with little success.

− Here the real problem may be something else such as the low motivation of employees who feel they do not have

enough control over their work.

− In the long run, a higher salary will not affect employees ’ intentions to leave.

• Finding the “right” answer to the “wrong” problem definition will not help.

• The approach to determine the problem-”the 5 whys”:

− Problem: My best employees are leaving the organization.

− Why? Because they are not satisfied with their jobs.

− Why? Because they do not find a challenge in their jobs.

− Why? Because they do not have control over their work.

− Why? Because they do not have a lot of influence over planning, executing, and evaluating the work they do.

− Why? Because we have been reluctant to delegate.

Problems versus symptoms of problems


Market Research

• isolate the key ideas in the first version of the problem statement.

• A broad, first statement of the problem often includes several words and/or phrases that need definition.

− For example: “Minority group members in organizations are not advancing in their careers.”

• To identify the key terms in your problem statement, look for:

− Subjects (careers),

− Verbs (advancing), and

− Objects (minority group members) in your statement.

• Definitions of key terms must be precise in order to identify the subject of the research and to gain access to relevant

academic literature.

Bringing clarity and focus to the problem


Market Research

Preliminary information gathering (or preliminary

research) will help us to make the necessary

transformations.

Preliminary information is conducted through three

initial stages of the research process and illustrates

how we get from a broad management problem to a

feasible topic for research.

Narrowing down our research


Market Research

• Preliminary research should help the researcher to find answers to questions such as:

− “What is the problem?”;

− “Why does the problem exist?”;

− “Is the problem important?”; and

− “What are the benefits of solving the problem?”

• Nature of the information needed

1. Information on the organization and its environment – that is, the contextual factors.

2. Information on the topic of interest.

Preliminary Research


Market Research

• A good problem statement includes both a statement of

the research objective(s) and the research question(s).

• The purpose or objective of the study thus explains why

the study is being done.

• The statement of the research objective(s) should be

brief, but nonetheless communicate clearly the focus of

the project.

• Examples of research objectives:

− To find out what motivates consumers to buy a product

online.

− To study the effect of leadership style on employees’

job satisfaction.

− To investigate the relationship between capital

structure and profitability of the firm.

• Once the purpose of the study has been identified, one

is able to formulate the research question(s) of the

study.

• They guide and structure the process of collecting and

analyzing information to help you to attain the purpose

of your study.

• In other words, research questions are the translation of

the problem of the organization into a specific need for

information.

Defining The Problem Statement


Problem Statement

Business Problem Research Objective Research Questions

Frequent and long delays may

translate into much frustration

among airline passengers, to

switching behavior, and to

negative word‐of‐mouth

communication. These feelings

and behaviors eventually have

negative effects on the

performance and the

profitability

of the firm.

The purpose of this study

is twofold: (1) to identify

the factors that influence

the passengers ’ waiting

experience and (2) to

investigate the possible

impact of waiting on

customer satisfaction and

service evaluations.

1. What are the factors that

affect the perceived

waiting experience of airline

passengers and

to what extent do these factors

affect the

perception of waiting times?

2. What are the affective

consequences of

waiting and how does affect

mediate the

relationship between waiting

and service

evaluations?

3. How do situational variables

(such as filled

time) influence customer

reactions to the

waiting experience?

Market Research

• A blueprint or plan for the collection, measurement, and analysis of data, created to answer your research questions.

• The research design discuss issues relating to decisions regarding:

− The Research Strategy (For Instance, Experiments, Surveys, Case Studies),

− The Extent To Which The Study Is Manipulated And Controlled By The Researcher (Extent Of Researcher

Interference),

− Location (I.E., The Study Setting),

− The Level At Which The Data Will Be Analyzed (Unit Of Analysis), And

− Temporal Aspects (The Time Horizon)

Research Design


Market Research

A research strategy will help you to meet your research objective(s) and to answer the research questions.

The choice for a particular research strategy will therefore depend on the research objective(s) and (the type of) research

questions of your study,

Also based on your viewpoint on what makes good research and on practical aspects such as access to data sources and

time constraints.

Research Strategies


Market Research

• Experiments: usually associated with a hypothetico‐deductive

approach to research.

− The purpose of an experiment is to study causal relationships

between variables.

− Experimental designs are less useful or appropriate for answering

exploratory and descriptive research questions.

− In an experiment, the researcher manipulates the independent

variable to study the effect of this manipulation on the dependent

variable.

• Survey Research

− A system for collecting information from or about people to

describe, compare, or explain their knowledge, attitudes, and

behavior.

− Popular in business research, because it allows the researcher to

collect quantitative and qualitative data on many types of research

questions.

− Commonly used in exploratory and descriptive research to collect

data about people, events, or situations.

− Survey instruments include questionnaires, interviews and

structured observation.

Elements of Research Design (Research Strategies)


• Ethnography

• Has its roots in anthropology.

• The researcher closely observes, records, and engages in the

daily life of another culture and then writes accounts of this

culture, emphasizing descriptive detail.

• Involves immersion in the particular culture of the social group

that is being studied observing behavior, listening to what is

said in conversations, and asking questions.

• It thus aims to generate an understanding of the culture and

behavior of a social group from an “insider’s point of view.”

• Participant observation is closely related to ethnography.

• Case Studies

− Focus on collecting information about a specific object, event or

activity, such as a particular business unit or organization.

− The case is the individual, the group, the organization, the event,

or the situation the researcher is interested in.

− To obtain a clear picture of a problem one must examine the

real‐life situation from various angles and perspectives using

multiple methods of data collection.

Market Research

• Grounded Theory

− A systematic set of procedures to develop an inductively derived theory from the data.

− Important tools of grounded theory are theoretical sampling, coding, and constant comparison.

− Theoretical sampling is the process of data collection for generating theory whereby the analyst jointly collects, codes, and

analyzes the data and decides what data to collect next and where to find them, in order to develop a theory as it emerges.

− In constant comparison you compare data (for instance, an interview) to other data (for instance, another interview).

• Action research

− Aimed at effecting planned changes.

− Begin with a problem that is already identified, and gathers relevant data to provide a tentative problem solution.

− This solution is then implemented, with the knowledge that there may be unintended consequences following such

implementation.

− The effects are then evaluated, defined, and diagnosed, and the research continues on an ongoing basis until the problem

is fully resolved.

− Thus, action research is a constantly evolving project with interplay among problem, solution, effects or consequences,

and new solution.

− A sensible and realistic problem definition and creative ways of collecting data are critical to action research.

Elements of Research Design (Research Strategies)


Market Research

• Correlational study is conducted in a natural environment (for instance, a supermarket or the factory floor) with

minimal interference by the researcher with the normal flow of events.

• Cause‐and‐effect relationships,

− The researcher tries to manipulate certain variables so as to study the effects of such manipulation on the dependent

variable of interest.

− The researcher deliberately changes certain variables in the setting

− Interferes with the events as they normally occur.

− Could be done on a laboratory setting

Elements of Research Design: Extent of researcher interference with the study


Market Research

• Exploratory and descriptive (correlational) studies are invariably conducted in noncontrived settings,

• Whereas most causal studies are done in contrived lab settings.

• Studies done in noncontrived settings are called field studies.

• Studies conducted to establish cause‐and‐effect relationships using the same natural environment in which the subjects

under study (employees, consumers, managers, and the like) normally function are called field experiments.

Elements of Research Design: Study setting


Market Research

• The unit of analysis refers to the level of aggregation of the data collected during the subsequent data analysis stage.

• Depend on the research objectives and research questions

− Individuals as the unit of analysis

− Dyads as the unit of analysis

− Groups as the unit of analysis

− Divisions as the unit of analysis

− Industry as the unit of analysis

− Countries as the unit of analysis

Elements of Research Design: Unit of Analysis


Market Research

• Cross-sectional (one-shot) studies: data are gathered just once, perhaps over a period of days or weeks or months,

in order to answer a research question.

• Longitudinal studies: data are gathered at more than one point in time.

− For instance, the researcher might want to study employees’ behavior before and after a change in the top

management, so as to know what effects the change accomplished.

− Help to identify cause‐and‐effect relationships.

− Experimental designs invariably are longitudinal studies, since data are collected both before and after a

manipulation.

− Field studies may also be longitudinal: If a manager wants to keep track of certain factors over a period of time to

assess improvements, or to detect possible causal connections

Elements of Research Design: Time horizon


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