1. Conducting Marketing
Research and
Forecasting Demand
Donna Sia, Rhea Jardin, Shelle Caiga
MBA Standard
April 7, 2012
yourwebsite.com
www.

2. Outline: Conducting Marketing
Research and Forecasting
Demand
1. Defining Marketing Research
2. Developing the research plan
3. Metrics for measuring good
marketing productivity
4. Assessing ROI of marketing
expenditures
5. Measuring and Forecasting Demand
yourwebsite.com
www.

3. Marketing research is…
important because it…
Why?
– Can lead to the success of a brand or a
product.
How?
– By producing insight into the
customer’s attitudes and buying
behavior
yourwebsite.com
www.

4. Marketing Research is the…
Systematic design Collection Analysis Reporting of
data and
findings
relevant to a specific marketing situation facing the company.
yourwebsite.com
www.

5. Marketing Research Process
involves…
1.Defining the 2.Developing the 3.Collecting 4.Analyzing
problem research plan information the information
& objectives
5.Presenting the findings 6.Making the decision
www.yourwebsite.com

6. Developing the Research Plan
1. Data Sources
2. Research instruments
3. Research approach
4. Sampling plan
5. Contact methods
yourwebsite.com
www.

7. Developing the Research Plan
Researchers can gather:
Primary Data
– Data freshly gathered for a specific purpose or
for a specific research project
Secondary Data
– Collected for another purpose and
already exist somewhere
yourwebsite.com
www.

8. Developing the Research Plan
Marketing Research can be approached in many ways:
Observation Focused Group Survey Research
Behavioral Data Experimentation
www.yourwebsite.com

9. Developing the Research Plan
The following research instruments are used
to collect data:
Questionnaires
Qualitative Measures
Technological Devices
www. yourwebsite.com

10. Step 2:
Developing the Research Plan
Some popular Qualitative Research approaches are…
Word association Projective techniques
.
Laddering
Brand Personification Visualization
www. yourwebsite.com

11. Developing the Research Plan
Sampling Plan decisions:
1) Sampling plan unit: Who should we
survey?
2) Sample size: How many people should we
survey
3) Sampling procedure: How should we
choose the respondents?
yourwebsite.com
www.

12. Step 2:
Developing the Research Plan
Probability and Non probability Samples:
Probability Sample Non probability Sample
1) Simple random 1) Convenience
sample sample
2) Stratified random 2) Judgment sample
sample 3) Quota sample
3) Cluster Sample
yourwebsite.com
www.

13. Developing the Research Plan
Contact Methods:
Telephone Interview Personal Interview
Online Interview Mail Questionnaire
yourwebsite.com
www.

14. Characteristics of good
marketing research
Research Multiple Interdependence of
Scientific Method creativity methods models and data
Value and cost Healthy skepticism Ethical marketing
of information
www.yourwebsite.com

15. Measuring Marketing
Productivity
-Marketing Metrics
External
Awareness Market share Relative price Consumer
Satisfaction
& Loyalty
Number of Distribution Total number of customers
complaints
www.yourwebsite.com

16. Marketing Mix Model
Internal
Awareness &
Active support Resource adequacy
commitment to goals
Willingness Freedom
Desire to learn to change Autonomy
to fail
www.yourwebsite.com

17. Marketing Dashboards to
improve effectiveness and
efficiency
Customer Metrics Unit Metrics Cash-flow Brand
www.yourwebsite.com

18. Marketing Measurement
Pathway
Technically Sound but Ad-hoc Efforts
Across Multiple Measurement Silos
Customer Unit Cash-Flow Brand Metrics
Metrics Metrics Metrics Metrics
Hierarchy Products/ Program & Brand Imagery/
of Effects Category Sales Company ROI Attributes
Satisfaction/ Marketing Cost/ Media Mix Equity Drivers
Experience Unit Models
Attitude/Behavior Margin Initiative Portfolio Financial
Segment Margin
Optimization Optimization Valuation
www. yourwebsite.com

19. Marketingbut Ad-hoc Efforts
Technically Sound
Measurement
Pathway Measurement Silos
Across Multiple
Customer Unit Cash-Flow Brand Metrics
Metrics Metrics Metrics Metrics
Hierarchy Products/ Result: Program & Brand Imagery/
of Effects Category Sales Company ROI
Hundreds of reports but very Attributes
Little knowledge integration or learning
Satisfaction/ Marketing Cost/ Media Mix Equity Drivers
Experience Unit synthesis Models
Attitude/Behavior Margin Initiative Portfolio Financial
Segment Margin
Optimization Optimization Valuation
www.yourwebsite.com

20. Forecasting Demand and
Measurement
Purpose:
– Identify market opportunities
How:
– Measure and forecast size, growth
and profit potential of market opportunities
Who:
– Marketers are responsible for preparing sales
forecast which are based on estimates of demand.
yourwebsite.com
www.

21. Major Concepts in Demand
Measurement
1. Market Demand
2. Company Demand
• Demand function
• Sales forecast
• Potential
yourwebsite.com
www.

22. Ninety Types of Demand
Measurement
yourwebsite.com
www.

23. The Measures of Market
Demand
Ways to break down the market:
1. Potential Market
2. Available Market
3. Target Market
4. Penetrated market
yourwebsite.com
www.

24. Market Forecast and Market
Potential
Market Forecast
– Market demand corresponding to the level of
Industry marketing expenditure.
Market Potential
– Is the limit approached by the market demand as
an industry marketing expenditures approach
infinity for a given marketing environment.
www.yourwebsite.com

25. Marketing Demand as a
function of Marketing
Expenditure
Market Demand in the Specific Period
Market
potential, Q2
Market
forecast, QF
Planned expenditure
Market
minimum, Q1
Industry Marketing Expenditure
yourwebsite.com
www.

26. Marketing Demand as a
function of Marketing
Expenditure
Market Demand in the Specific Period
Market
Potential
(prosperity)
Prosperity
Market
Recession
Potential
(recession)
Industry Marketing Expenditure
yourwebsite.com
www.

27. Market Demand and Company
Demand
Market Demand
– total volume that would be bought ….
A defined Marketing Program
by a defined in a defined in a defined in a defined
customer group geographical area time period marketing
environment
www.yourwebsite.com

28. Market Demand and Company
Demand
Company Demand
– Is the company’s estimated share of market
demand at alternative levels of company
marketing effort at a given time period
www.yourwebsite.com

29. Company Sales Forecast a
nd Sales Potential
Company Sales Forecast
– Is the expected level of company sales based on a
chosen marketing plan and an assumed target
market
Company Sales Potential
– is the sales limit approached by company demand
as a company marketing effort increases relative
to that of competitors
www.yourwebsite.com

30. Estimating Current Demand
Marketing executives would like to
estimate..
1. Total Market Potential
2. Area Market Potential
3. Total Industry Sales and Market share
yourwebsite.com
www.

31. Estimating Current Demand
Total Market Potential is the
Marketing effort and environment
maximum available to all the during a given
amount of sales firms in an industry period
yourwebsite.com
www.

32. Estimating Current Demand
Area Market Potential
Estimating market potential of
different
Marketing effort and environment
during a given
maximum
in an area (city, state or nation) period
amount of sales
www.yourwebsite.com

33. Estimating Current Demand
The 2 Major Methods of assessing
area market potential are…
1. Market-Build-up Method
– Identify all the potential buyers in
each market and estimate their potential
purchases
2. Multiple-Factor Index Method
-assigning weights to different factors (income, sales,
population, buying power)
yourwebsite.com
www.

34. Estimating Current Demand
Calculating the Brand Development
Index:
Territory Percent of Percent of BDI
US Brand US Category
Sales Sales (a/b) x100
Seattle, CA 3.09 2.71 114
Portland, OR 6.74 10.41 65
Boston, MA 3.49 3.85 91
Toledo, OH 0.97 0.81 120
Chicago, IL 1.13 0.81 140
Baltimore, 3.12 3.00 104
MD
www. yourwebsite.com

35. Estimating Current Demand
Industry Sales and Marketing Shares
– identifying competitors and estimating their sales
– Derive data from: industry trade association
– Buy reports from marketing research (E.g.
Nielsen)
– Industry Data, Competitors Data
– Over-all or Brand by Brand
www.yourwebsite.com

36. Estimating Future Demand
Good forecasting is a key factor in
success
Macro
econo
mic
Industry
Company
Forecast
yourwebsite.com
www.

37. Estimating Future Demand
All forecasts are built on one of the
three information bases:
1. What people say. (Survey)
2. What people do (Test Market)
3. What people have done. (Buying History)
yourwebsite.com
www.

38. Estimating Future Demand
Survey of Buying Intentions
Forecasting
– Is the art of anticipating what buyers are likely to
do under a given set of conditions.
Do you intend to buy a car in the next 6 months?
Purchase probability scale
0.00 0.20 0.40 0.60 0.80 1.00
No Chance Slight Fair Good High Certain
Possibility Possibility Possibility Possibility
www. yourwebsite.com

39. Estimating Future Demand
Composite of Sales Force Opinion
– Sales representatives
Expert Opinion
– dealers, distributors, suppliers, marketing
consultants and trade associations
Past-sales Analysis
– Time series analysis, Exponential smoothing,
Statistical demand analysis (causal factors),
Econometric Analysis
Market-Test Method
www.yourwebsite.com

40. Summary:
1.Defining the
problem
& objectives
Sample plan, Sources, Contact Methods, Instruments
2.Developing the
research plan
3.Collecting Sales Force, Experts, History and Market Sales
information
Market and company Demand
4.Analyzing
Total and Area Market Potential, industry sales & market share the information
5.Presenting the findings
Customer is happy The brand is profitable Employees are satisfied 6.Making the decision
www. yourwebsite.com

41. Conducting Marketing
Research and
Forecasting Demand
Donna Sia, Rhea Jardin, Shelle Caiga
MBA Standard
April 7, 2012
yourwebsite.com
www.

42. Conducting Marketing
Research and
Forecasting Demand
Donna Sia
MBA Standard
April 7, 2012
yourwebsite.com
www.

43. Outline: Conducting Marketing
Research and Forecasting
Demand
1. Defining Marketing Research
2. Developing the research plan
3. Metrics for measuring good
marketing productivity
4. Assessing ROI of marketing
expenditures
5. Measuring and Forecasting Demand
yourwebsite.com
www.

44. Marketing research is…
important because it…
Why?
– Can lead to the success of a brand or a
product.
How?
– By producing insight into the
customer’s attitudes and buying
behavior
yourwebsite.com
www.

45. Marketing Research is the…
Systematic design Collection Analysis Reporting of
data and
findings
relevant to a specific marketing situation facing the company.
yourwebsite.com
www.

46. Marketing Research Process
involves…
1.Defining the 2.Developing the 3.Collecting 4.Analyzing
problem research plan information the information
& objectives
5.Presenting the findings 6.Making the decision
www.yourwebsite.com

47. Developing the Research Plan
1. Data Sources
2. Research instruments
3. Research approach
4. Sampling plan
5. Contact methods
yourwebsite.com
www.

48. Developing the Research Plan
Researchers can gather:
Primary Data
– Data freshly gathered for a specific purpose or
for a specific research project
Secondary Data
– Collected for another purpose and
already exist somewhere
yourwebsite.com
www.

49. Developing the Research Plan
Marketing Research can be approached in many ways:
Observation Focused Group Survey Research
Behavioral Data Experimentation
www.yourwebsite.com

50. Developing the Research Plan
The following research instruments are used
to collect data:
Questionnaires
Qualitative Measures
Technological Devices
www. yourwebsite.com

51. Step 2:
Developing the Research Plan
Some popular Qualitative Research approaches are…
Word association Projective techniques
.
Laddering
Brand Personification Visualization
www. yourwebsite.com

52. Developing the Research Plan
Sampling Plan decisions:
1) Sampling plan unit: Who should we
survey?
2) Sample size: How many people should we
survey
3) Sampling procedure: How should we
choose the respondents?
yourwebsite.com
www.

53. Step 2:
Developing the Research Plan
Probability and Non probability Samples:
Probability Sample Non probability Sample
1) Simple random 1) Convenience
sample sample
2) Stratified random 2) Judgment sample
sample 3) Quota sample
3) Cluster Sample
yourwebsite.com
www.

54. Developing the Research Plan
Contact Methods:
Telephone Interview Personal Interview
Online Interview Mail Questionnaire
yourwebsite.com
www.

55. Characteristics of good
marketing research
Research Multiple Interdependence of
Scientific Method creativity methods models and data
Value and cost Healthy skepticism Ethical marketing
of information
www.yourwebsite.com

56. Measuring Marketing
Productivity
-Marketing Metrics
External
Awareness Market share Relative price Consumer
Satisfaction
& Loyalty
Number of Distribution Total number of customers
complaints
www.yourwebsite.com

57. Marketing Mix Model
Internal
Awareness &
Active support Resource adequacy
commitment to goals
Willingness Freedom
Desire to learn to change Autonomy
to fail
www.yourwebsite.com

58. Marketing Dashboards to
improve effectiveness and
efficiency
Customer Metrics Unit Metrics Cash-flow Brand
www.yourwebsite.com

59. Marketing Measurement
Pathway
Technically Sound but Ad-hoc Efforts
Across Multiple Measurement Silos
Customer Unit Cash-Flow Brand Metrics
Metrics Metrics Metrics Metrics
Hierarchy Products/ Program & Brand Imagery/
of Effects Category Sales Company ROI Attributes
Satisfaction/ Marketing Cost/ Media Mix Equity Drivers
Experience Unit Models
Attitude/Behavior Margin Initiative Portfolio Financial
Segment Margin
Optimization Optimization Valuation
www. yourwebsite.com

60. Marketingbut Ad-hoc Efforts
Technically Sound
Measurement
Pathway Measurement Silos
Across Multiple
Customer Unit Cash-Flow Brand Metrics
Metrics Metrics Metrics Metrics
Hierarchy Products/ Result: Program & Brand Imagery/
of Effects Category Sales Company ROI
Hundreds of reports but very Attributes
Little knowledge integration or learning
Satisfaction/ Marketing Cost/ Media Mix Equity Drivers
Experience Unit synthesis Models
Attitude/Behavior Margin Initiative Portfolio Financial
Segment Margin
Optimization Optimization Valuation
www.yourwebsite.com

61. Forecasting Demand and
Measurement
Purpose:
– Identify market opportunities
How:
– Measure and forecast size, growth
and profit potential of market opportunities
Who:
– Marketers are responsible for preparing sales
forecast which are based on estimates of demand.
yourwebsite.com
www.

62. Major Concepts in Demand
Measurement
1. Market Demand
2. Company Demand
• Demand function
• Sales forecast
• Potential
yourwebsite.com
www.

63. Ninety Types of Demand
Measurement
yourwebsite.com
www.

64. The Measures of Market
Demand
Ways to break down the market:
1. Potential Market
2. Available Market
3. Target Market
4. Penetrated market
yourwebsite.com
www.

65. Market Forecast and Market
Potential
Market Forecast
– Market demand corresponding to the level of
Industry marketing expenditure.
Market Potential
– Is the limit approached by the market demand as
an industry marketing expenditures approach
infinity for a given marketing environment.
www.yourwebsite.com

66. Marketing Demand as a
function of Marketing
Expenditure
Market Demand in the Specific Period
Market
potential, Q2
Market
forecast, QF
Planned expenditure
Market
minimum, Q1
Industry Marketing Expenditure
yourwebsite.com
www.

67. Marketing Demand as a
function of Marketing
Expenditure
Market Demand in the Specific Period
Market
Potential
(prosperity)
Prosperity
Market
Recession
Potential
(recession)
Industry Marketing Expenditure
yourwebsite.com
www.

68. Market Demand and Company
Demand
Market Demand
– total volume that would be bought ….
A defined Marketing Program
by a defined in a defined in a defined in a defined
customer group geographical area time period marketing
environment
www.yourwebsite.com

69. Market Demand and Company
Demand
Company Demand
– Is the company’s estimated share of market
demand at alternative levels of company
marketing effort at a given time period
www.yourwebsite.com

70. Company Sales Forecast a
nd Sales Potential
Company Sales Forecast
– Is the expected level of company sales based on a
chosen marketing plan and an assumed target
market
Company Sales Potential
– is the sales limit approached by company demand
as a company marketing effort increases relative
to that of competitors
www.yourwebsite.com

71. Estimating Current Demand
Marketing executives would like to
estimate..
1. Total Market Potential
2. Area Market Potential
3. Total Industry Sales and Market share
yourwebsite.com
www.

72. Estimating Current Demand
Total Market Potential is the
Marketing effort and environment
maximum available to all the during a given
amount of sales firms in an industry period
yourwebsite.com
www.

73. Estimating Current Demand
Area Market Potential
Estimating market potential of
different
Marketing effort and environment
during a given
maximum
in an area (city, state or nation) period
amount of sales
www.yourwebsite.com

74. Estimating Current Demand
The 2 Major Methods of assessing
area market potential are…
1. Market-Build-up Method
– Identify all the potential buyers in
each market and estimate their potential
purchases
2. Multiple-Factor Index Method
-assigning weights to different factors (income, sales,
population, buying power)
yourwebsite.com
www.

75. Estimating Current Demand
Calculating the Brand Development
Index:
Territory Percent of Percent of BDI
US Brand US Category
Sales Sales (a/b) x100
Seattle, CA 3.09 2.71 114
Portland, OR 6.74 10.41 65
Boston, MA 3.49 3.85 91
Toledo, OH 0.97 0.81 120
Chicago, IL 1.13 0.81 140
Baltimore, 3.12 3.00 104
MD
www. yourwebsite.com

76. Estimating Current Demand
Industry Sales and Marketing Shares
– identifying competitors and estimating their sales
– Derive data from: industry trade association
– Buy reports from marketing research (E.g.
Nielsen)
– Industry Data, Competitors Data
– Over-all or Brand by Brand
www.yourwebsite.com

77. Estimating Future Demand
Good forecasting is a key factor in
success
Macro
econo
mic
Industry
Company
Forecast
yourwebsite.com
www.

78. Estimating Future Demand
All forecasts are built on one of the
three information bases:
1. What people say. (Survey)
2. What people do (Test Market)
3. What people have done. (Buying History)
yourwebsite.com
www.

79. Estimating Future Demand
Survey of Buying Intentions
Forecasting
– Is the art of anticipating what buyers are likely to
do under a given set of conditions.
Do you intend to buy a car in the next 6 months?
Purchase probability scale
0.00 0.20 0.40 0.60 0.80 1.00
No Chance Slight Fair Good High Certain
Possibility Possibility Possibility Possibility
www. yourwebsite.com

80. Estimating Future Demand
Composite of Sales Force Opinion
– Sales representatives
Expert Opinion
– dealers, distributors, suppliers, marketing
consultants and trade associations
Past-sales Analysis
– Time series analysis, Exponential smoothing,
Statistical demand analysis (causal factors),
Econometric Analysis
Market-Test Method
www.yourwebsite.com

81. Summary:
1.Defining the
problem
& objectives
Sample plan, Sources, Contact Methods, Instruments
2.Developing the
research plan
3.Collecting Sales Force, Experts, History and Market Sales
information
Market and company Demand
4.Analyzing
Total and Area Market Potential, industry sales & market share the information
5.Presenting the findings
Customer is happy The brand is profitable Employees are satisfied 6.Making the decision
www. yourwebsite.com

82. Conducting Marketing
Research and Forecasting
Demand
Donna Sia
MBA Standard
April 7, 2012
yourwebsite.com
www.

83. Conducting Marketing Research &
Forecasting Demand
Marketing Management
Submitted to Prof. de Ungria
Shelle Caiga
04.27.2012
yourwebsite.com
www.

84. yourwebsite.com
www.

85. Data Research
Sources Approach
Research Sampling
Instruments Plan
Contact
Methods
yourwebsite.com
www.

86. Etnographic
Focus Group
Behavioral
Data
yourwebsite.com
www.

87. Questionnaires: DO’s
Ensure questions are FREE of BIAS
K.I.S.S. (Keep It Short & Simple)
Make it SPECIFIC
No to JARGONS
No to SOPHISTICATED words
No to AMBIGUOUS words
www.yourwebsite.com

88. Questionnaires: DON’Ts
No negatives
No hypothetical
No words that could be misheard
Use response bands
Use mutually exclusive categories
Allow for “other” in fixed response questions
www. yourwebsite.com

89. Word Association
Projective Techniques
Visualization
Brand Personification
Laddering
yourwebsite.com
www.

90. Sampling Unit
Sample Size
Sampling Procedure
yourwebsite.com
www.

91. PROBABILITY NON-PROBABILITY
Sample Sample
 Involve random selection x Doesn’t involve random selection
yourwebsite.com
www.

92. MAILS FACE-TO-FACE PHONE ONLINE
QUESTIONNAIRES INTERVIEW INTERVIEW INTERVIEW
yourwebsite.com
www.

93. yourwebsite.com
www.

94. Distribution
Awareness Number of complaints
Relative price Market share
Total # of customers Customer satisfaction
Loyalty
yourwebsite.com
www.

95. Awareness of goals
Commitment of goals
Active support Desire to learn
Staffing levels Freedom to fail
Willingness to change
Resource adequacy
Customer satisfaction
Autonomy
www. yourwebsite.com

96. An EXEMPLARY
MARKETING RESEARCH
will definitely result to an
EXCELLENT CUSTOMER SATISFACTION
Nobody counts the number of ads you run; they just remember the impression you make.
– Bill Bernbach, advertising pioneer and founder of DDB
www. yourwebsite.com

97. Marketing Research
and Forecasting
Demand
MARKMA
Submitted to Prof. de Ungria
Rhea G. Jardin
April 27, 2012
yourwebsite.com
www.

98. 1. Marketing Research
Characteristics of good Marketing Research
1. Scientific method
2. Creativity
3. Multiple research methods
4. Accurate model building
5. Cost-benefit analysis
6. Healthy skepticism
7. Ethical focus
yourwebsite.com
www.

99. 2. Marketing Metrics
A. Short-term results
1. Sales turnover
2. Shareholder value
B. Changes in brand equity
1. Customer awareness, attitudes and behaviors
2. Market share
3. Price premium
4. Number of complaints
5. Distribution and availability
6. Total number of customers
7. Perceived quality, loyalty and retention
www.yourwebsite.com

100. Marketing Metrics
Short term
Sales turnover Shareholder value
yourwebsite.com
www.

101. Marketing Metrics
Brand Equity
Distribution and
availability
Price premium
Customer
awareness, attitudes
and behaviors
Number of complaints
Total number of customers
Market
share
do-RE-mi..
so-la-TI - ON
Perceived quality, loyalty and retention
www. yourwebsite.com

102. Marketing Research
and Forecasting
Demand
MARKMA
Submitted to Prof. de Ungria
Rhea G. Jardin
April 27, 2012
yourwebsite.com
www.