MR CH 2 SUMMARY

Defining the Marketing Research Problem

➢ The first step in conducting a marketing research project is defining the marketing research problem.
➢ It is important to define the marketing research problem appropriately because it serves as a guideline to the researcher for conducting
the rest of the marketing research project.
➢ Thus, in absence of a well-defined problem, the data collected may be worthless to the decision maker.
➢ In marketing research, problems and opportunities are treated interchangeably.
➢ Problem definition involves stating the general problem and identifying the specific components of the marketing research problem.
➢ Only when the marketing research problem has been clearly defined can research be designed and conducted properly. even though the
research will be wasting resources. the researcher needs to understand the nature of both the problem or the decision which management
faces in order to determine the underlying information needs. Sometimes discussions with industry experts, analysis of secondary data,
and preliminary research are required to identify the factors that must be considered for the proper identification of the decision problem.
The final step is to translate the decision problem into a research problem.
As we mentioned above, the tasks involved in problem definition consist of:
1- discussions with the decision makers,
2- interviews with industry experts and other knowledgeable individuals,
3- analysis of secondary data,
4- and sometimes qualitative research.

These tasks help the researcher to understand the background of the problem by analyzing the environmental context.
Understanding the environmental context facilitates the identification of the management decision problem. Then the management decision
problem is translated into a marketing research problem.

Exploratory research
• may be conducted to obtain greater understanding of a concept or to defining a problem. It is also used to identify important
variables to be studied. Exploratory research is preliminary research.
• Exploratory research can take several forms: pilot studies, experience surveys, secondary data analysis, pilot studies case analysis,
and focus groups.
Experience surveys
• involve talking with knowledgeable individuals, both inside (e.g marketing manager or production manager) and outside (supplier
or distributors or economists) the organization, they are persons who may provide insights into the problem.
• Rarely do experience surveys include a formal questionnaire. Instead, the researcher may simply have a list of topics to be
discussed. The survey, then, is much like an informal discussion.

Sources of collecting information about marketing research problem:

1- Discussions with decision makers (DM) are extremely important.
• The first main source of collecting information about marketing research problem.
• the researcher must communicate with the DM in order to understand the nature of the problem the DM faces and what he hopes to
learn from the research. And to know the events that led to the need for making a decision. Such an understanding will help the
researcher in gathering information relevant to the problem faced by the decision maker.
• Whenever possible, top management should be involved in defining the problem. A systematic approach to working with the DM is
the problem audit. It enables the researcher to get beyond the mere symptoms to understand the causes of the problem.

The problem audit provides a useful framework for interacting with the DM and identifying the underlying causes of the problem. The
problem audit, like any other type of audit, is a comprehensive examination of a marketing problem with the purpose of understanding its
origin and nature.

Difference Between Problem and Its Symptoms

• It is important to perform a problem audit because the DM, in most cases, has only a vague idea of what the problem is.
• The researcher should treat the underlying causes, not merely address the symptoms. For example, the DM may know that the firm
is losing market share but may not know why, because DMs tend to focus on symptoms rather than on causes.
• loss of market share may be caused by a superior promotion by the competition, inadequate distribution of the company’s products,
or any number of other factors. Only when the underlying causes are identified can the problem be successfully addressed,

These are examples of symptoms (indicators that there is a problem) and symptoms which are the real causes of the symptoms)
Symptom Problems
Heavy turnover in Sales force - Lack of proper sales incentives
- Improper allocation of territories
- Unrealistic sales quotas
Declining market share - Outdated product
- New competition
- Shifting demographics
- Inappropriate pricing
High sales force turnover - Inappropriate incentives
- Inappropriate work load

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By Dalia Elaraby PPT by DR. Ola El Azzazy
 MR CH 2 SUMMARY
Management Decision Problem And Marketing Research Problem
Once the true management decision problem has been identified, it must be converted into a marketing research problem.
➢ A marketing research problem specifies what information is needed to solve the problem and how that information can be
obtained efficiently and effectively. The marketing research objective, then, is the goal statement, defining the specific
information needed to solve the marketing research problem.
➢ In contrast to the marketing research problem, the management decision problem is action oriented. Management decision
problems tend to be much broader in scope and far more general than marketing research problems, which must be narrowly
defined and specific if the research effort is to be successful. Sometimes several research studies must be conducted to solve a broad
management decision problem.

Management Decision Problem Marketing Research Problem

Should a new product be introduced? To determine consumer preferences and purchase intentions for the
proposed new product
Should the advertising campaign be changed? To determine the effectiveness of the current advertising campaign
Should the price of the brand be increased? To determine the price elasticity of demand and the impact on sales
and profits of various levels of price changes
Should the price be cut in response to a price-cut by a competitor? Determine the buyer- behavior at various price levels.
What should be done to increase the relative market share of Determine the strengths and weaknesses of ‘Y’ vis-à-vis those of
product ‘Y’? the competitors

Management decision problem Marketing research problem

Asks what the decision maker needs to do Asks what information is needed and how it should be obtained.
Action oriented Information oriented
Focuses on symptoms Focuses on the underlying causes

➢ Once the management decision problem has been formulated, the last step in the process is to translate it into a marketing research
problem.
➢ After interviewing DM The researcher may also hold interviews with industry experts, analyze secondary data, and conduct
preliminary research to properly identify the management decision problem.

2- Interviews with Industry Experts:

• Interviews with industry experts, individuals knowledgeable about the firm and the industry, may help formulate the marketing
research problem. (They can be found inside or outside the firm).
• Note that industry experts can provide useful information about the prevailing market conditions. They can be especially useful in
the case of industrial marketing research where technical knowledge is required. Regarding secondary data, it is important to
provide economical and quick information that can be useful in understanding the problem clearly. Sometimes focus groups are
used to provide information that is then used in refining the problem.

Focus Groups
- Focus groups are in-depth discussions, usually consisting of 8 to 12 participants, which are led by a moderator and are generally limited
to one particular concept, idea, or topic. The general idea is to have thoughts and comments by others. That is, the interplay of responses
will yield more information than if the same number of persons had contributed in individual interviews.
- Focus groups are probably the most popular form of exploratory research.

3- Secondary data analysis:

• Secondary data are data collected for some purpose other than the problem in hand.
• They include information made available by business and government sources, commercial marketing research firms and
computerized databases.
• Analysis of available secondary data is an essential step in the problem definition process

4- Qualitative research
• It is an unstructured, exploratory research methodology based on small samples intended to provide insight and understanding of the
problem setting and may utilize popular qualitative techniques such as focus groups and depth interviews.
• Emphasize that the purpose of qualitative research is to get a feel for the situation rather than a conclusive result. Such research can
and should play a useful role in helping the researcher to understand the problem more clearly. Techniques such as focus group
interviews, pilot surveys, and in-depth interviews are often used to find the opinion of the consumers.
• After determining the research problem, research question is basically formulated to find an answer to a specific issue. Then A
hypothesis is a possible answer to the research question that can be empirically tested. For example, a research question may be
framed as: “How does the age of a consumer affect the purchase of a car?” A possible hypothesis is, “People in the age group 45–55
tend to buy upscale cars.”

Based on the definition of the marketing research problem, an appropriate approach is developed.

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By Dalia Elaraby PPT by DR. Ola El Azzazy