Chapter 5

Research Design
 Research Design

• A research design is a set of advance decisions

that makes up the master plan specifying the
methods and procedures for collecting and
analyzing the needed information.
 Types of Research Design

• Although every problem and research objective

may seem totally unique, there are usually
enough similarities among problems and
objectives to allow decisions to be made in
advance about the best plan to resolve the
problem.
• There are some basic marketing research designs
that can be successfully matched to given
problems and research objectives.
 Types of Research Design

• Three traditional categories:

• Exploratory
• Descriptive
• Causal
• The choice of the most appropriate design
depends largely on the objectives of the research
and how much is known about the problem and
research objectives.
 Research Design: A Caution

• Research design should not be viewed as a step-

by-step process.
• Research may begin with any one of the three
types of research designs.
 Basic Research Objectives and Research
Design

Research Objective Appropriate Design

To gain background information, to define terms, to clarify Exploratory

problems and hypotheses, to establish research
priorities

To describe and measure marketing phenomena at a point Descriptive

in time

To determine causality, to make “if-then” statements Causal

 Research Design: Exploratory Research

• Exploratory research is most commonly

unstructured, informal research that is
undertaken to gain background information about
the general nature of the research problem.
• Exploratory research is usually conducted when
the researcher does not know much about the
problem and needs additional information or
desires new or more recent information.
 Research Design: Exploratory Research

• Exploratory research is used in a number of

situations:
• To gain background information
• To define terms
• To clarify problems and hypotheses
• To establish research priorities
 Research Design: Exploratory Research

• A variety of methods are available to conduct

exploratory research:
• Secondary Data Analysis
• Experience Surveys
• Case Analysis
• Focus Groups
• Projective Techniques
 Research Design: Descriptive Research

• Descriptive research is undertaken to describe

answers to questions of who, what, where, when,
and how.
• Two basic classifications:
• Cross-sectional studies
• Longitudinal studies
 Research Design: Descriptive Research
Cross-sectional Studies

• Cross-sectional studies measure units from a

sample of the population at only one point in
time.
• Sample surveys are cross-sectional studies
whose samples are drawn in such a way as to be
representative of a specific population.
• On-line survey research is being used to collect
data for cross-sectional surveys at a faster rate of
speed.
AT&T used cross-sectional, descriptive research to determine
which type of corporate brand signatures would be less
confusing to consumers (The one on the left was best).
Affinnova conducts cross-sectional surveys allowing
consumers to design products online
 Research Design: Descriptive Research
Longitudinal Studies

• Longitudinal studies repeatedly measure the

same sample units of a population over a period
of time.
• Researchers must have access to the same
members of a sample (a panel) to take repeated
measures.
• On-line survey research firms recruit panel
members to respond to online queries.
Online research firms use online panels to
collect information
 Research Design: Descriptive Research
Longitudinal Studies

• Two types of panels:

• Continuous panels ask panel members the
same questions on each panel measurement.
• Discontinuous panels vary questions from
one panel measurement to the next.
• Longitudinal data are used for:
• Market tracking studies
• Brand-switching studies
(See Pooch Plus Example)
 Changes from Two Cross-sectional Studies
Survey 1 to Survey 2

• Pooch Plus dropped from 100 to 75 families

• Beggar’s Bits remained the same at 200
• Milk Bone increased from 200 to 225

Conclusion: Pooch Plus is losing market share

to Milk Bone. Target Milk Bone with a
strategy to win back market share!
 Longitudinal Data Analysis

• Pooch Plus kept 50 families and lost 50

families to Beggar’s Bits!
• Pooch Plus gained 25 former Beggar’s
Bits families
• Milk Bone gained 25 former Beggar’s
Bits families
Conclusion: Beggar’s Bits is the
competition..Not Milk Bone!!!
 Research Design: Causal Research

• Causality may be thought of as understanding a

phenomenon in terms of conditional statements
of the form “If x, then y.”
• Causal relationships are determined by the use of
experiments.
• Experiments can be conducted using online
research.
 Experiments

• An experiment is defined as manipulating an

independent variable to see how it affects a dependent
variable, while also controlling the affects of additional
extraneous variables.
• Independent variables: variables over which the
researcher has control and wishes to manipulate I.e.
package size, ad copy, price.
• Dependent variables: those over which the
researcher has little to no direct control, but has a
strong interest in manipulating I.e. sales, profit,
market share.
• Extraneous variables: variables that may effect a
dependent variable but are not independent variables.
 Experimental Design

• An experimental design is a procedure for

devising an experimental setting such as a change
in a dependent variable that may be attributed
solely to a change in an independent variable.
• Symbols of an experimental design:
• O = measurement of a dependent variable
• X = manipulation, or change, of an independent
variable
• R = random assignment of subjects to
experimental and control groups
• E = experimental effect
 Experimental Design

• After-Only Design: X O1
• One-Group, Before-After Design: O1 X O2
• Before-After with Control Group:
• Experimental group: O1 X O2
• Control group: O 3 O4
• Where E = (O2 – O1) – (O4 – O3)
 How Valid Are Experiments?

• An experiment is valid if:

• the observed change in the dependent variable
is, in fact, due to the independent variable
(internal validity)
• if the results of the experiment apply to the
“real world” outside the experimental setting
(external validity)
 Types of Experiments

• Two broad classes:

• Laboratory experiments: those in which the
independent variable is manipulated and
measures of the dependent variable are taken
in a contrived, artificial setting for the purpose
of controlling the many possible extraneous
variables that may affect the dependent
variable
• Field experiments: those in which the
independent variables are manipulated and
measurements of the dependent variable are
made on test units in their natural setting
 Test Marketing

• Test marketing is the phrase commonly used to

indicate an experiment, study, or test that is
conducted in a field setting.
• Two broad classes:
• To test the sales potential for a new product or
service
• To test variations in the marketing mix for a
product or service
 Types of Test Markets

• Standard test market: one in which the firm tests

the product and/or marketing mix variables
through the companies normal distribution
channels
• Controlled test markets: ones that are conducted
by outside research firms that guarantee
distribution of the product through prespecified
types and numbers of distributors
 Types of Test Markets…cont.

• Electronic test markets: those in which a panel of

consumers has agreed to carry identification
cards that each consumer presents when buying
goods and services
• Simulated test markets: those in which a limited
amount of data on consumer response to a new
product is fed into a model containing certain
assumptions regarding planned marketing
programs, which generates likely sales volume
 Test Markets

• Test marketing is used in both consumer markets

and industrial or B2B markets as well.
• Lead country test market: test marketing
conducted in specific foreign countries that seem
good predictors for an entire continent
 Criteria for Selecting Test Market Cities

• Representativeness: Do demographics match the

total market?
• Degree of isolation: Phoenix and Tulsa are
isolated markets; Los Angeles is not isolated.
• Ability to control distribution and promotion: Are
there preexisting arrangements to distribute the
new product in selected channels of distribution?
Are local media designed to test variations in
promotional messages?
 Test Marketing

• Pros:
• Allows most accurate method of forecasting
future sales
• Allows firms the opportunity to pretest
marketing mix variables
• Cons:
• Does not yield infallible results
• Are expensive
• Exposes the new product or service to
competitors
• Takes time to conduct