ch 4.sol capala

TOP 10 Learning Concepts

Ch 4: Conducting Marketing Research And Forecasting Demand

Mirasol Capala

September 2011

http://solcapala.blogspot.com/

Concept Outline

http://solcapala.blogspot.com/9/8/2011 2

7. Forecasting and Demand Measurement- Why Study Demand? 8. Types of Market Demands9. Company Demand10. Estimating Current and Future Demand

1. Effective Marketing Research System for Large and Small companies 2. Effective Marketing Research Follows the 6 Marketing Research Steps3. Choosing the Research Approaches for your Marketing Research

4. Different Types of Research Instruments 5. Sampling Plan6. Contact Methods

Effective Marketing Research System for Large Companies


Zpryme, a leading global research firm, today announced its latest

market research practice launch, China Insights, service

focused on the China consumer and business marketplace.

Custom marketing research firm

Syndicated-service research firm

Specialty-line marketing research firm

Firms that gather consumer and trade information, which they sell for a fee.

http://zpryme.com/

http://zpryme.com/practices/china-insights.html

Example of Marketing Research for Large Companies


•Streaming video is an indication of the future of consumer entertainment

•Research used by Microsoft (MSFT) and Sony(SNE)- reason why they focus on the game console.

97% of smart phones should come touch screens by 2016

Syndicated Research

Effective Marketing Research System for Small Companies


Crowdcasting Using the Internet Checking out rivals

Research conducted in creative and affordable ways.

Example of Marketing Research for Small Companies


Using the Internet

•Small companies use Twitter to create niche markets•Twitter is a great place to look at what people are discussing, buying, suggesting and current overall trends.

Use the Top 50 of All Time,

Tweetstatsto see fresh,

relevant and current

trends for free.

Effective Marketing Research Follows the 6 Marketing Research Steps


•Firms should set specific research objectives.

•Firms must decide whether to collect their own data or use data that already exist.

•They must also decide which research approach, which research instruments to use.

•They must decide on a sampling plan and contact methods.

Example of Company following the 6 Steps of Marketing Research Process


Step 1: P&G wanted to enter the Chinese market with a sound strategy after Chinese experts warned the company that

nobody in China could afford Head & Shoulders.

Step 2: P&G developed a research plan to know the common problem among

Chinese consumers.

Step 3: P&G collected information through online

research, surveys and telephone interviews.

Step 4: They have analyze the information and did several

analysis to test the strength of the conclusions.

Step 5: The company's market research revealed that though there were several

shampoo marketers in China, there was no shampoo that could remove dandruff from

the scalp. Dandruff was a common hair problem among the Chinese consumers.

Step 6: P&G hence launched Head & Shoulders, a brand that was known

for its anti-dandruff properties. Within three years of its launch,

Head & Shoulders became China's bestselling shampoo, even though it was priced three times higher than

the local brands.

Choosing the Research Approaches for your Marketing Research


Observation Behavioural Data Experiments

Focus Group Discussion Surveys

Example of Use of Different Marketing Research Approaches


Focus Group Discussion

Findings: Dinner party guests were bringing their host

flowers instead of chocolate, in a nod to current concerns over

obesity & health.

Surveys

Survey Reveals: Online Coupon Sites Remain Top

Consumer Choice for Deals

68 % of daily deal users reported using daily deal sites

for impulse rather than planned purchases.

Different Types of Research Instruments


Questionnaire

Technological Devices

Qualitative Research

Example of Use of Different Research Instruments


Qualitative Research •Mapping Bush and Kerry to well-known product and corporate brands reveals how each candidate is viewed and suggests brand strategies each can employ to potentially sway the critical undecided voter group.

•Bush is associated with the positive attributes of established mainstay brands like Bud Light, IBM and Ford ("reliable", "humble", "heritage", "solid"); Kerry is associated with the positive attributes of premium brands like Heineken, Apple, and BMW ("high-quality", "high-performance", "hip", "young")

•To win undecided voters, Kerry must prove that he has substance, that he's not all flash and marketing. Bush, on the other hand, must focus on emphasizing that his strengths – stability and reliability – are more important than being ultra-modern or progressive

Sampling Plan


Sampling UnitWho should we survey?

Sampling SizeHow many people should we survey?

Sampling ProcedureHow should we choose the

respondents?

Example of Sampling Plan


When times are tough, Pinoys commute

Sampling Unit: The survey focused on the travelhabits of commuters on the Metro Rail Transit (MRT)and Light Rail Transit (LRT) systems.

Sample Size: Nielsen conducted interviews with 500 MRT3 passengers, 250 LRT1 passengers and 250 LRT2 passengers in February 2009.

Sample Procedure: The survey used random sampling methods and has a 5 percent margin of error.

With Nielsen's survey findings proving that

consumers spend more time outside the home, it is a go

signal for more advertisers to invest in "out-of-home"

advertisements.

What this means

for advertisers?

Contact Methods


Mail Questionnaire Personal Interview

Telephone Interview

Online Interview

Example of Contact Methods in Conducting Marketing Research


Ground coffee reviewCHOICE’s expert tasters find some of the best brews at very affordable prices.

Personal Interview

Tester brews each coffee in the same way using a Breville ESP8B Café Roma espresso machine. Three experts rate the coffees, giving them scores for the colour and thickness of the crema, aroma, flavour, mouthfeel and aftertaste.

Forecasting and Demand MeasurementWhy Study Demand?


FINANCE OPERATIONS PURCHASING HR MARKETING

The cash that is required for operations and investments

To establish capacity and output levels

To get the right amount of supplies

To get the right number of workers

To prepare sales forecasts

Example of Wrong Sales Forecast


Xerox commissioned three independent consultants to explore the opportunity for a copier. Two consultants advised against the launch and the third consultant forecast sales of 8,000 units over 6 years.

Xerox chose to ignore the recommendations of the consultants, launched the copier and installed 80,000 machines within just 3 years.

The market research had underestimated demand as respondents were unable to provide their views on a new product that they had never experienced.

Types of Market Demands


PotentialMarket

Available Market Target

Market

Penetrated Market

Consumers have income, access to

product

Consumers have interest, income and access to

product

Qualified available

market the company decides to

pursue

Sets of customers who are buying

company’s products

Example of Market Research for Different Market Demands


A researcher at 3M was eager to create the world's best glue, but actuallyended up creating one of the worst glues ever – one that didn't stick – whichnevertheless ended up as one of 3M's most successful products: that of theubiquitous Post-it notes.

Potential Market

Company Demand


It is the company’s estimated share of market demand at alternative levels of company marketing effort at a given time period.

Sales Forecast

Is the expected level of company sales based on a chosen marketing plan and an assumed marketing

environment.

Sales Potential

Is the sales limit approached by company demand as company marketing effort increases relative to that

of competitors.

Example of Sales Forecast


Christmas Sales Forecast Gets More GrimBuyers expected to stay frugal through

holiday season

Of those consumers who normally give gift cards but won't this

year, 64.4 % will give money instead

Seventy percent of consumers said that they stayed within their budgets, an indicator of this year's disciplined shopper.

Of those consumers who will give fewer gift cards, over a

third say that there is a chance they

could give nothing at all.

Only 35.6 percent said they would give gifts

instead,

Example of Sales Potential


Retail sales rise 3.6% during holidays Romance novels embrace Christmas spirit and sales

potential

Estimating Current Demand


Practical methods for estimating current market demand

Total Market Potential Maximum amount of sales that might be

available to all firms in an industry during a period of time.

Area Market Potential Maximum amount of sales that might be

available in different cities, states, and nations.

Example of Estimating Current Demand


Understand the total market potential of infant car seats in both units and Pesos.

Baby Car Seat Manufacturer

If two million babies are expected in a year, the market for infant seats is 2m units.

However some of the households may be two car households and decide to buy two seats. If 50% of the households buy two seats, then the market is

really 3m units.

Estimating Future Demand


All forecasts are built on one of 3 information bases: what people say, what people do, or what people have done. Good forecasting is a key factor in success of the

companies.

Survey of Buyer’s Intention

Useful in estimating demand for industrial products,

consumer durables and new products.

Expert OpinionObtain forecasts from

experts, including dealers, distributors, suppliers,

marketing consultants, and trade associations.

Past- Sales AnalysisFirms can develop sales

forecasts on the basis of past sales.

Example of Estimating Future Demand


Farmers' intentions regarding fertilizer usage

In the fertilizer business it is possible to assess farmers' intentions through retailers. Many retailers are located

in villages and are in daily touch with farmers.

It should be possible to ascertain from each retailer directly or through a large sample, the likely fertilizer

demand. Through enquiry from their own outlets, marketing organisations can produce a fairly accurate

sales forecast.

Being close to the scene of action, they have a good assessment of produce price trends, available

purchasing power, likely crop shifts, etc.

Survey of Buyer’s Intention

TOP 10 Learning Concepts

Ch 4: Conducting Marketing Research And Forecasting Demand

Mirasol Capala

September 2011

http://solcapala.blogspot.com/

ch 4.sol capala

Business