Page 525 - Encyclopedia of Business and Finance

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Marketing Research

Physical Distribution. How manufacturers store, handle, MARKETING RESEARCH
and move products to customers at the right time and at
Accelerating product cycles, easy access to information on
the right place is referred to as physical distribution. In products and services, highly discerning consumers, and
considering physical distribution, manufacturers need to fierce competition among companies are all a reality in the
review issues such as distribution objectives, product world of business. Too many companies are chasing too
transportation, and product warehousing. Choosing the few consumers. Therefore, knowing, understanding, and
mode of transportation requires an understanding of each responding to one’s target market is more important than
possible method: rail, truck, water, pipeline, and air. ever. And this requires information—good information.
Rail transportation is typically used to ship automo- Good information can lead to successful products and
biles, chemicals, farm products, minerals, and sand. Truck services. Good information is the result of market
transportation is most suitable for transporting clothing, research. Marketing gurus Kevin Clancy and Peter Krieg
gasoline and diesel fuel, food, and paper goods. Water in their book, Counterintuitive Marketing, wrote, “Mar-
transportation is good for oil, grain, sand, gravel, metallic keting research, we believe, poses many dangers and many
ores, coal, and other heavy items. Pipeline transportation opportunities. Bad research can, and often does, lead
companies in the wrong direction. Good research, on the
is best when shipping products such as oil or chemicals.
other hand, is the sine qua non of the counterintuitive
Air transport works best when moving technical instru-
approach to great marketing” (quoted in DeVries, 2005).
ments, perishable products, and important documents.
Product Distribution. Another issue of concern to manu- WHAT IS MARKETING RESEARCH?
facturers is the level of product distribution. Normally, According to the Marketing Research Association, “Mar-
manufacturers select from one of three levels of distribu- keting research is a process used by businesses to collect,
tion: intensive, selective, or exclusive. Intensive distribu- analyze and interpret information used to make sound
business decisions and successfully manage the business”
tion occurs when manufacturers distribute products
(2005). Marketing research is a $6-billion-a-year industry.
through all wholesalers or retailers that want to offer their
Marketing research provides, analyzes, and interprets
products. Selective distribution occurs when manufactur-
ers distribute products through a limited, select number of information for manufacturers on how consumers view
wholesalers and retailers. Under exclusive distribution, their products and services and on how they can better
meet consumer needs. The ultimate goal is to please the
only a single wholesaler or retailer is allowed to sell the
consumer in order to get, or keep, the consumer’s busi-
product in a specific geographic area.
ness.
SEE ALSO Marketing; Pricing; Promotion
HISTORY OF MARKETING
BIBLIOGRAPHY RESEARCH PIONEERS
Boone, Louis E., and Kurtz, David L. (2005). Contemporary Marketing research as an organized business activity began
marketing 2006 (11th ed.). Eagan, MN: Thomson South- between 1910 and 1920. The appointment of Charles
Western. Collidge Parlin as manager of the Commercial Research
Churchill, Gilbert A., Jr., and Peter, Paul J. (1998). Marketing: Division of the Advertising Department of the Curtis
Creating value for customers (2nd ed.). New York: Irwin Publishing Company in 1911 is generally noted to be the
McGraw-Hill.
beginning of marketing research. Parlin’s success led sev-
Farese, Lois, Kimbrell, Grady, and Woloszyk, Carl (2002). Mar- eral industrial firms and advertising media to establish
keting essentials (3rd ed.). Mission Hills, CA: research divisions. In 1915 the U.S. Rubber Company
Glencoe/McGraw-Hill.
hired Dr. Paul H. Nystrom to manage a newly established
Kotler, Philip, and Armstrong, Gary (2006). Principles of market- Department of Commercial Research. In 1917 Swift and
ing (11th ed.). Upper Saddle River, NJ: Pearson Prentice-
Company hired Dr. Louis D. H. Weld from Yale Univer-
Hall.
sity to become manager of their Commercial Research
Pride, William M., and Ferrell, O. C. (2006). Marketing concepts Department.
and strategies. New York: Houghton Mifflin.
In 1919 Professor C. S. Duncan of the University of
Semenik, Richard J., and Bamossy, Gary J. (1995). Principles of Chicago published Commercial Research: An Outline of
marketing: A global perspective (2nd ed.). Cincinnati: South- Working Principles, considered to be the first major book
Western.
on commercial research. In 1921 Percival White’s Market
Analysis was published; the first research book to gain a
Allen D. Truell large readership, it went through several editions. Market

502 ENCYCLOPEDIA OF BUSINESS AND FINANCE, SECOND EDITION