Page 123 - Marketing Management

100 PART 2 CAPTURING MARKETING INSIGHTS

An airline looking to add in-flight
Internet service would need
to conduct careful consumer
research.

include business class, and possibly economy class? (3) What price(s) should we charge? (4) On
what types of planes and lengths of trips should we offer the service?
Now management and marketing researchers are ready to set specific research objectives:
(1) What types of first-class passengers would respond most to using an in-flight Internet
service? (2) How many first-class passengers are likely to use the Internet service at different
price levels? (3) How many extra first-class passengers might choose American because of this
new service? (4) How much long-term goodwill will this service add to American Airlines’
image? (5) How important is Internet service to first-class passengers relative to other services,
such as a power plug or enhanced entertainment?
Not all research projects can be this specific. Some research is exploratory—its goal is to shed
light on the real nature of the problem and to suggest possible solutions or new ideas. Some re-
search is descriptive—it seeks to quantify demand, such as how many first-class passengers would
purchase in-flight Internet service at $25. Some research is causal—its purpose is to test a cause-
and-effect relationship.

Step 2: Develop the Research Plan
The second stage of marketing research is where we develop the most efficient plan for gathering
the needed information and what that will cost. Suppose American made a prior estimate that
launching in-flight Internet service would yield a long-term profit of $50,000. If the manager
believes that doing the marketing research will lead to an improved pricing and promotional plan
and a long-term profit of $90,000, he should be willing to spend up to $40,000 on this research. If
the research will cost more than $40,000, it’s not worth doing. 10
To design a research plan, we need to make decisions about the data sources, research
approaches, research instruments, sampling plan, and contact methods.

DATA SOURCES The researcher can gather secondary data, primary data, or both. Secondary
data are data that were collected for another purpose and already exist somewhere. Primary data
are data freshly gathered for a specific purpose or for a specific research project.
Researchers usually start their investigation by examining some of the rich variety of low-cost
and readily available secondary data, to see whether they can partly or wholly solve the problem
without collecting costly primary data. For instance, auto advertisers looking to get a better return
on their online car ads might purchase a copy of J.D. Power and Associates’ semiannual Power Auto
Online Media Study, a survey that gives insights into who buys specific brands and where on the
Web advertisers can find them. 11
When the needed data don’t exist or are dated, inaccurate, incomplete, or unreliable, the
researcher will need to collect primary data. Most marketing research projects do include some
primary-data collection.