MAR 3023 FSU Brady Exam 2 with Complete Solutions

Market Research - ANSWER-process of designing, gathering, analyzing, and reporting information that may be used to understand customers and solve a marketing problem. ● The foundation of marketing Customer satisfaction assessments - ANSWER-JD power customer satisfaction ○ Teaching Evaluations at FSU Net Promoter Score (NPS) - ANSWER-How likely is it that you would recommend us to family, friends, colleagues etc.? ■ 11 point scale (including zero) ○ Companies care a lot about this number, constantly monitoring ○ Measures quality perceptions, value, satisfaction, etc New Product design - ANSWER-Minivans and ketchup packets developed based on focused groups and interactions with moms and their wants and needs ■ Solved frequent problems moms have with their kids ○ Starbucks used My starbucks idea platform and took customer ideas to start using different types of milk in their drinks 1980's ● TQM movement (Deming & Juran) - ANSWER-Customer orientation: It became apparent that companies needed to put customers and customer satisfaction at the forefront of their assessments ■ Research to find customer reaction to product ■ Research to compare product to competitors' ■ Research to find problems with product BIG Data - ANSWER-Customer Orientation: retailers and other companies have access to all kinds of data from the point of sale → captures 200 TB of weblog data everyday ■ Predict customer behavior ■ Profile/map entire customer journey ● Before, while and after they purchase ■ Personalize and customize product experiences WHY IS BIG DATA IMPORTANT? - ANSWER-Loyal customers are 5 times as likely to repurchase, 5 times as likely to forgive, 7 times as likely to try new offerings and 4 times as likely to refer ● One unhappy customer tells 9-12 others; one happy customer tells 1-5 ● Its five times as costly to attract new customers than it is to retain old ones ● The probability of selling to an existing customer is 14 times higher than a new one Cluster analysis - ANSWER-statistical analysis technique that identifies customer segments MDS - ANSWER-statistical analysis technique that creates perceptual maps based on similarity data Companies use the marketing mix in order to move their brands around the perceptual space to put it in a lucrative marketing segment Conjoint Analysis - ANSWER-statistical technique that gives price sensitivity information ○ How do company's price product ○ Creating different derivations of products and ask people how much their willing to pay for it ○ Companies are maximizing the configuration for anything their offering - they know exactly the needs and how to attract different market segments in real time Applied research - ANSWER-research designed to solve a specific problem - usually for a specific company (e.g., consulting) a. They would come to you and say in a specific segment, sales are way down and we need you to figure out how to solve it Basic Research - ANSWER-researched designed to extend knowledge of marketing phenomena Generalizable - ANSWER-the best and most important type of research because it can be applicable to lots of companies Marketing Research process - ANSWER-1. Problem definition 2. Research design 3. Sampling 4. Data gathering 5. Data analysis 6. Report preparation Problem Definition - ANSWER-"A problem well defined is Half solved ● Symptoms vs problems ○ Sales are down ○ Decreased foot traffic Exploratory research (qualitative research) - ANSWER-helps in problem solving as it allows the researcher to better define the problem by getting a look at it first-hand Possible tasks involved in exploratory research - ANSWER-Manager interviews ○ Expert interviews ○ Secondary data ○ Qualitative research ■ All inform the researcher what the real problem is through triangulations Secondary data - ANSWER-information that has been collected for a purpose other than the research at hand a. example) ACSI - american customer satisfaction index i. Website that houses customer satisfaction data since 1994 ii. Owner of site created a stock portfolio full of companies that are known for customer satisfaction and has become super wealthy b. What's the problem with it? i. You have to trust that the data gathered by someone else for something else is accurate Primary Data - ANSWER-information that has been gathered specifically for the research objectives at hand a. Your gathering this data yourself Information: three different kinds of data IN STAGES - ANSWER-Exploratory - focus groups, observation studies, secondary source ○ Descriptive - cross-tabs, regression ■ Survey data ○ Causal - Experiments Exploratory - ANSWER-describes less structured data collection methods ● Used in the design to clarify the problem ○ Secondary information ○ Qualitative research Focus groups - ANSWER-most common market research technique A flexible, group discussion of a product, ad or concept Descriptive - ANSWER-describes the characteristic of a population Generally associated with surveys: who buys, what they buy, when, where & how much Online - respondents answer questionnaire via email or website, most popular ■ Sona ○ Mail - very rare these days ○ Telephone - mostly political surveys, but ACSI is done this way ○ Personal interview surveys - participants respond to survey questions face to face Qualtrics - ANSWER-provider of subscription software for collecting and analyzing data for market research. Used for: ● Customer satisfaction and loyalty studies ● Product and concept beta testing ● Employee evaluations ● Website feedback ● Cofounded by a marketing professor at BYU, very wealthy now Amazon Mechanical-Turk ("M-Turk") - ANSWER-a crowdsourced marketplace where anyone can request, and pay for, individuals to complete tasks that computers are unable to do. ● Most closely associated with survey completion ● E.g., you offer 75 cents in return for a completed survey ● Named after "the Turk," an 18th-century chess-playing automaton that toured Europe, beating both Napoleon and Ben Franklin ○ It was later revealed that the "machine" was really a human chess master hidden in the cabinet beneath the board Causal - ANSWER-identifies cause and effect between variables ● Experiments ○ Controlling for all variables except what your interested in and the dependant variable that you want to measure ● Correlation and causation ○ Correlation doesn't necessarily mean causation, things have nothing to do with each other but they can move in the same direction at the same time (there is no causation) ○ Eliminate spurious correlation Basic Research -- example - ANSWER-Chick fil a and In-N-Out Burger- if they screw up they are more likely to be forgiven / be better off because of their religious affiliation Frontline technology - ANSWER-Wanted to look at the effects of frontline technology on customer satisfaction - when your interacting with the cashier at the grocery store ● Results suggest countervailing effects ○ If your having a positive experience then the technology detracted from the experience, a negative encounter with the cashier then technology it moves it up Situational Influence - ANSWER-example) around halloween consumers are exposed to black and orange, and gravitate towards things that have this color pattern (sales of reese's cups goes through the roof around halloween) Visual arrays - ANSWER-can influence variety and uniqueness seeking behaviors Endowment effect - ANSWER-People value objects they own more than the same object if they don't own it ○ Even if the purchase was made minutes ago ○ Emotional attachment ○ Also shows up in rewards cards ■ People buy more with 2/10 punch card than 0/8 punch card Anchoring - ANSWER-Price anchors are powerful mental shortcuts that restrict how much companies can charge for similar products ■ Ex) Candy bars are all priced similar despite how well selling they are ○ The only way of the anchoring effect is to make the product sufficiently different so that it breaks the anchored price ■ Ex) Red Bull was able to break away from the soft drink anchor, $20 for a case vs $5 for a case → led to a lot of soft drink companies creating their own energy drink because the margins were so high for redbull ● This explains starbucks and craft beer as well (they were able to separate from their normal anchors) Involvement - ANSWER-High-involvement products ■ Purchased only after careful consideration ■ Tend to be visible to others, risky, and/or expensive (like cars or skydiving) ○ Low-involvement products ■ Products that tend to be less expensive and have less associated risk ■ Like socks, paperclips, gum, toothpaste → this is where brand name becomes very important ○ Involvement 4x4 graphic Consumer buying behavior - ANSWER-different types of purchases that are based on different types of problems that consumers face: ■ Routinized response (cost) ■ Limited problem solving (search effort) ■ Extended problem solving (time spent) ■ Impulse buying (brand preference) ○ Ties to involvement levels Routinized/habitual decision making - ANSWER-Choices made with little to no conscious effort ○ People tend to be attracted to whatever brand they know, and move on instead of spend time thinking of other options ■ Brands drive purchase behavior Limited Problem Solving - ANSWER-Requires a moderate amount of time for information gathering ■ Familiar with the product class but not the brand ■ Restaurants, clothes ● Searching for "The Best Of" Extended Problem solving - ANSWER-The consumer tries to gain as much information up front as possible from both internal (memory) and external (advertising) sources ○ The decision is made by considering all of the attributes and considering how each brand rates on each attribute. ■ Picking the college you want to go to, what car to get, etc THE CONSUMER BUYING DECISION PROCESS - ANSWER-1. Problem recognition 2. Information search 3. Evaluation of alternatives 4. Purchase 5. Post Purchase evaluation PROBLEM RECOGNITION - ANSWER-Occurs when a buyer becomes aware of a difference between a desired state and an actual condition