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CHAPTER 14
Communicating the Research Results and Managing Marketing Research


LEARNING OBJECTIVES
1. To become aware of the primary purposes of a research report.

2. To learn how to organize and prepare a research report.

3. To learn how to make a personal presentation.

4. To understand the effective use and communication of marketing research information.

5. To understand what clients want from a marketing research supplier or department.

6. To learn some of the key managerial functions in running a marketing research supplier organization.

7. To see what marketing researcher departments are doing to gain a more strategic role in the
        organization.

8. To examine how corporations are measuring the contribution of marketing research to the
        organization.



KEY TERMS
Executive summary                                         Conclusions

Recommendations                                           Research management



CHAPTER SCAN
This chapter describes the importance of communicating the results of the marketing research project. It
also outlines the steps needed to do so effectively. Noise, attention span, and selective perception are all
barriers to effective communication that researchers must consider when considering the presentation of
the research results.

The research report is the written communication of every aspect of the study. It must communicate the
specifics of the project as well as act as a reference document and build credibility. The report is
organized into seven major areas, with 11 basic components. A recommended outline is given in the
chapter. When preparing the report, the researcher must remember to watch for several pitfalls,
including making the report too lengthy.

The oral presentation of the research results has changed greatly with the creation of presentation
software. The presentation can reacquaint the managers with the research objectives and highlight
research conclusions. The presenter should be prepared to provide copies of the presentation outline,
copies of the executive summary, and copies of the final report to the audience members.
Another aspect of communicating the research results is to get the manager to use the research
information. To do this, the report must be credible and useful, there must be good client/researcher
interaction, the top managers must be a proponent of research, and the key users must understand
research and have the seniority to use it.

Once a research report has been received, a manager must make the decision to use or not use a
research report. This is determined by the quality of the entire research process.



CHAPTER OUTLINE
1 The Research Report

        I. Research Report Objectives

                A. Research Report

                B. Organizing the Report

                C. Interpreting the Findings

                D. Format Presenting the Report

                E. Formulating Recommendations

2 The Presentation

        I. Presentation Materials.

                A. Two Aids for a Personal Presentation

                B. Making a Presentation

3 Presentations on the Internet

        I. Steps for Presentations on the Internet

4 Marketing Research Supplier Management

        I. What Do Clients Want?

                A. Top-10 List

                B. Communication

                C. Managing the Research Process

                D. Client Profitability Management

                F. Staff Management and Development

5 Managing a Marketing Research Department
I. Selecting the Right Marketing Research Suppliers

                A. Capabilities of Suppliers

        II. Moving Marketing Research into a Decision-Making Role

                A. Role of Marketing Research in the Managerial Decision-making Process

                B. Measuring Marketing Research‟s Return on Investment (ROI)

6 Summary



CHAPTER SUMMARY
OPENING VIGNETTE: Propane Education & Research Council (PERC)

Propane, the alternative to oil and gas, is a safe and cost effective fuel for reducing energy bills that has
not reached its full potential. The Propane Education & Research Council is making inroads in the effort to
increase awareness of propane as an alternative resource.

There is a lot riding on PERC‟s assessment of market potential, and providing funding for the right idea
could turn the tide for propane the way the light bulb did for electricity. PERC‟s challenge is to evaluate
the impact of each project on the propane market, prioritize it, and demonstrate its value to the propane
producers funding the organizations.

PREC had Osborn & Barr Communications develop a series of research projects that would eventually
help PERC prioritize and fund new technologies that would change the nature of farming.

A comprehensive, user-friendly research matrix now allows PERC to identify and quantify market potential
for new agricultural technologies such as thermal agriculture, crop drying, engines, food safety, waste
treatment, and other agriculture production areas.

When developing the report Jeff Whetstine of Osborn & Barr suggested that in the development of the
research report that did not aim to tell PERC where they should invest, but instead wanted to provide
them with the appropriate information to make the best decisions. W hat is the role of the report?
Whetstine says, “let the data speak for itself.” Should researchers go beyond this to making
recommendations? How do clients decide whether or not to use research reports?

Learning Objective 14.1
Review Question 14.1
Review Question 14.2
Learning Objective 14.2
Review Question 14.3


1 THE RESEARCH REPORT

        I. Research Report Objectives
A. Research Report

                          1. Explain why the research was done

                          2. State the specific research objectives

                          3. Explain how the research was done

                          4. Present the Findings of the Research

                          5. Provide conclusions and recommendations

               B. Organizing the Report

                          1. Title page–dominated by the name of the project–the name of the client
                                   organization, name o the research firm, and date of the report.

                          2. Table of contents–should not exceed one page and should list the major
                                  sections of the report with the page numbers.

                          3. Executive summary–most difficult part of the report to write–it must be
                                 succinct–cover the key findings and any recommendations that flow from
                                 the findings.

See Exhibit 14.1 Sample Bulleted List from Executive Summary (p 471)

                          4. Background–sets the context for the research and addresses such things as
                                 the overall goal of the research, the decisions that need to be made, the
                                 company‟s strength and weaknesses regarding the issue in question.

                          5. Methodology–how the research was done and why it was done that way.

                          6. Findings–the longest section of the report and should summarize results for
                                  almost every question on the survey.

                          7. Appendixes

                                  a. Copy of the questionnaire

                                  b. Cross-tabulations

                                  c. Other supporting material

               C. Interpreting the Findings

                          1. Executive Summary–the portion of a research report that explains why the
                                 research was done, what was found, what those findings mean, and
                                 what action, if any, management should undertake.

Learning Objective 14.3
Learning Objective 14.4
2. Conclusions–generalizations that answer the question raised by the research
                                 objectives or otherwise satisfy the objectives.

                                 a. The conclusion of a research report should be a statement or series of
                                         statements that communicate the results of the study to the
                                         reader but would not necessarily include any of the data derived
                                         from the statistical analysis.

               D. Format of the Report

                          1. Presentation Software

                                 a. Create bulleted charts using various font styles and sizes with bold,
                                         italicized and underlined text.

                                 b. Develop various styles of charts and graphs and to experiment with
                                         different types of graphs (pie, bar, line, and so on) in an attempt
                                         to find the most efficient way to display a particular research
                                         finding.

                                 c. Apply other kinds of special formatting and organize pages to most
                                         effectively tell the story.

See Exhibit 14.2 Sample Presentation of Customer Satisfaction Results (p 471)

                          2. Predominate Reporting Style Characteristics

                                 a. It minimizes the use of words

                                 b. It feeds information to clients in what might be termed graphical
                                          „minibites‟.

                                 c. Graphics, text boxes, bulleted lists, and the like are used to interpret
                                         the meaning of various graphs.

               E. Formulating Recommendations

                          1. Recommendations–conclusions applied to marketing strategies or tactics
                                 that focus on a client‟s achievement of differential advantage

2 THE PRESENTATION

       I. Presentation Materials

Learning Objective 14.5
Review Question 14.4

               Effective communication in the presentation is absolutely critical. This may be the only
                        exposure to the findings that some decision makers in the company will see.

               A. Two Aids for a Presentation
1. Visuals–The PowerPoint presentation–slides should be succinct and relevant–
                           format should follow that of the report.

                   2. Copies of the final report–report serves as physical evidence of the
                          research–comprehensive nature makes clear that it includes much detail
                          that was omitted in the presentation–available to interested parties at
                          the end of the presentation.

             B. Making a Presentation

                   1. Tailored to the Audience

                           a. Receivers‟ frame of reference

                           b. Attitudes

                           c. Prejudices

                           d. Educational background

                           e. Time constraints

                   2. Reason Presentation Can Be Inadequate
                           a. Lacks an understanding of the barriers to effective communication.

                                   1) Select words, concepts, and illustrative figures to which the
                                           audience can relate.

                           b. Speaker fails to recognize or admit that the purpose of many research
                                   reports is persuasion.

                                   1) Persuasion–using research findings to reinforce conclusions
                                          and recommendations.

                   3. Keep the following questions in mind when preparing for the presentation.

                           a. What do the data really mean?

                           b. What impact do they have?

                           c. What have we learned from the data?

                           d. What do we need to do, given the information we now have?

                           e. How can future studies of this nature be enhanced?

                           f. What could make this information more useful?

See Exhibit 14.3 Multiple Graphs on a Page Tell a Story (p 472)

See Exhibit 14.4 Graphs and Tables on the Sam Page Maximize Communication (p
473)
See Exhibit 14.5 Different Types of Graphs and Tables Convey a Lot of Information
Quickly (p 474)

See Exhibit 14.6 Multiple Measures on a Single Satisfaction Item Conveyed on a
Single Page (p 475)

Learning Objective 14.6

3 PRESENTATIONS ON THE INTERNET

       With PowerPoint, publishing presentations to the Web is easier than ever. Publication to the Web
       enables individuals to access the presentation, regardless of where they are or when they need
       to access it. In addition, researchers can present results at multiple locations on the Internet.

4 MARKETING RESEARCH SUPPLIER MANAGEMENT

       I. What Do Clients Want?

               A. Top Ten List

                          1. Maintains client confidentiality

                          2. Is honest

                          3. Is punctual

                          4. Is flexible

                          5. Delivers against project specifications

                          6. Provides high quality output

                          7. Is responsive to the client‟s needs

                          8. Has high quality-control standards

                          9. Is customer oriented in interactions with client

                          10. Keeps the client informed throughout a project.

               B. Communication

                          1. Key to Good Supplier-Client Relations–communication

                          2. Liaison–every project should have a liaison who serves as a communication
                                  link between the supplier and the client.

                                   a. Must communicate accurately honestly and frequently with the client.

                                   b. Should go over the project objectives, methodology, and timing with
                                           the client.
Review Question 18-5

                              c. Client should sign off on the questionnaire.

                              d. Ascertain how often the client wants progress reports–include status
                                      of the project, unusual problems encountered, and, if it is a cost-
                                      plus project, expenses incurred to date.

                                      1) Cost-plus–to actual costs plus an additional markup to cover
                                              overhead.

              C. Managing the Research Process

                       1. Research Management–overseeing the development of excellent
                              communication systems, data quality, time schedules, cost controls,
                              client profitability, and staff development.

                       2. Organizing the Supplier Firm–traditionally organized around functions–this
                              allows technical people to perform backroom tasks such as programming
                              and data analysis and the “people people” to hand project management
                              and client contact a. In response to some of the problems created by
                              this type of organization, some companies are organizing by teams–
                              breaking up functional department and organizing their staff into units
                              based around client groups or research types.

                       3. Data Quality Management

                              a. Integrity and Quality of Data–research management is to ensure
                                      this factor.

                              b. Procedures–to ensure the careful proofing of all text, charts, and
                                     graphs in written reports.

                       4. Time Management

                              a. Keep project on schedule

                              b. Two problems that can play havoc with time schedules

                                      1) Inaccuracies in estimates of the incidence rate–percentage
                                              of persons or households out of the general population
                                              that fit the qualifications to be interviewed in a particular
                                              study.

                                      2) Interview length

                              c. System to Control Schedules–system in place to inform management if
                                      project is on schedule or not.

                       5. Cost Management–procedures for cost control

                              a. Systems that accurately capture data collection and other costs
                                      associated with the project on a daily basis.
b. Daily reporting of costs to project managers.

                            c. Policies and practices to communicate the budget picture.

                            d. Policies and practices that quickly identify “over-budget” situations.

                            e. If the project is over budget, the client should be offered options early
                                     in the process regarding higher costs, smaller sample size,
                                     shorter interview or some combination of the three.

             D. Client Profitability Management

                    1. Old Adage–20 percent of the clients generate 80 percent of the profits‟

                            a. Example of Custom Research Incorporated experience with too many
                            clients and how they handled the situation.

See Exhibit 14.7 CRI’s Client Profitability Analysis (p 481)

See Exhibit 14.8 Screening Questions Used by CRI and the Rationale for Each
Question (p 481)

             E. Staff Management and Development

                    1. Primary asset of a marketing research firm–people

                    2. Suggestions for staff development in a research firm:

                            a. Create an environment that encourages risk taking, experimentation,
                                    and responsibility.

                            b. Foster recognition and accountability

                            c. Provide job autonomy

                            d. Attract and support people with entrepreneurial attitudes

                            e. Connect rewards to a business result

                            f. Open your financial books

                            g. Offer diversity within your organization

                            h. Provide clear promotional paths

5 MANAGING A MARKETING RESEARCH DEPARTMENT

      I. Selecting the Right Marketing Research Suppliers

             A. Steps in Selecting a Research Supplier
1. Determine the project‟s requirements–nature, scope, and objectives

                          2. Assess the capabilities of alternative suppliers

                                  a. Do the vendors have a particular area of specialization?

                                  b. Are the firms committed to a particular technique and/or data
                                           collection method?

Learning Objective 14.7
Review Question 14.8
Learning Objective 14.8
Review question 14.9

                          3. Consider the size of the firm–it is an important decision criterion–if a small
                                  firm they can be overwhelmed with an enormous project.

                          4. Establish up front the individual who will be managing the project.

                          5. Research department manager needs to become acquainted with the
                                  backgrounds of the potential vendors.

                          6. Questions should be asked to determine the stability of the company and its
                                  qualifications to complete the project, such as:

                                  a. How long has the vendor been in business?

                                  b. For what other companies has the vendor conducted research
                                          projects?

                                  c. What are the academic backgrounds and experience of those persons
                                          who will be working on the project?

                                  d. Does the success of the project depend on the capabilities of a
                                          subcontractor?

                          7. Review the quality control standards of each potential vendor.

                          8. The reputations of the firms must be considered in the decision.

                          9. Avoid letting price be the sole determining factor in the selection.

       II. Moving Marketing Research into a Decision-Making Role

               A. Role of Marketing Research in the Managerial Decision-making Process

                          1. The researcher‟s challenge is to shed their long-held traditional role as a
                                  support function, one that reacts to requests from project and new
                                  product development managers and then focuses on producing the
                                  numbers but not on their meaning to the business.

                          2. Researchers must move beyond the task of simply crunching numbers and
                                  churning out results; they need to understand the underlying business
issues at stake and adjust the information they gather and how they
                          analyze it. They must reach out to other departments, building
                          relationships and a better understanding of the issues companywide.

See Exhibit 14.9 A researcher’s Route to the Table (p 486)

             B. Measuring Marketing Research’s Return on Investment (ROI)

                   1. Marketing expenditures–investments, with performance measures which come
                           from finance–the approach being used is Return On Investment (ROI)

                   2. Arguments against the use of ROI

                          a. ROI is theoretically flawed because it divides the profit return by the
                                  expenditure instead of subtracting it.

                          b. ROI was invented to compare alternative uses of capital, based on
                                  their projected percentage return on that capital.

                          c. Improving ROI tends to suboptimize expenditure

                          d. ROI usually focuses on the short term and does not consider the
                                  effects on the marketing asset (brand equity) or the dynamic
                                  development of marketing over longer time periods.

                          e. Purpose of the ROI ratio it to compare alternative expenditures.

                   3. Examples of ROI Lite and ROI Complete

6 SUMMARY

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Communicating Marketing Research Results

  • 1. CHAPTER 14 Communicating the Research Results and Managing Marketing Research LEARNING OBJECTIVES 1. To become aware of the primary purposes of a research report. 2. To learn how to organize and prepare a research report. 3. To learn how to make a personal presentation. 4. To understand the effective use and communication of marketing research information. 5. To understand what clients want from a marketing research supplier or department. 6. To learn some of the key managerial functions in running a marketing research supplier organization. 7. To see what marketing researcher departments are doing to gain a more strategic role in the organization. 8. To examine how corporations are measuring the contribution of marketing research to the organization. KEY TERMS Executive summary Conclusions Recommendations Research management CHAPTER SCAN This chapter describes the importance of communicating the results of the marketing research project. It also outlines the steps needed to do so effectively. Noise, attention span, and selective perception are all barriers to effective communication that researchers must consider when considering the presentation of the research results. The research report is the written communication of every aspect of the study. It must communicate the specifics of the project as well as act as a reference document and build credibility. The report is organized into seven major areas, with 11 basic components. A recommended outline is given in the chapter. When preparing the report, the researcher must remember to watch for several pitfalls, including making the report too lengthy. The oral presentation of the research results has changed greatly with the creation of presentation software. The presentation can reacquaint the managers with the research objectives and highlight research conclusions. The presenter should be prepared to provide copies of the presentation outline, copies of the executive summary, and copies of the final report to the audience members.
  • 2. Another aspect of communicating the research results is to get the manager to use the research information. To do this, the report must be credible and useful, there must be good client/researcher interaction, the top managers must be a proponent of research, and the key users must understand research and have the seniority to use it. Once a research report has been received, a manager must make the decision to use or not use a research report. This is determined by the quality of the entire research process. CHAPTER OUTLINE 1 The Research Report I. Research Report Objectives A. Research Report B. Organizing the Report C. Interpreting the Findings D. Format Presenting the Report E. Formulating Recommendations 2 The Presentation I. Presentation Materials. A. Two Aids for a Personal Presentation B. Making a Presentation 3 Presentations on the Internet I. Steps for Presentations on the Internet 4 Marketing Research Supplier Management I. What Do Clients Want? A. Top-10 List B. Communication C. Managing the Research Process D. Client Profitability Management F. Staff Management and Development 5 Managing a Marketing Research Department
  • 3. I. Selecting the Right Marketing Research Suppliers A. Capabilities of Suppliers II. Moving Marketing Research into a Decision-Making Role A. Role of Marketing Research in the Managerial Decision-making Process B. Measuring Marketing Research‟s Return on Investment (ROI) 6 Summary CHAPTER SUMMARY OPENING VIGNETTE: Propane Education & Research Council (PERC) Propane, the alternative to oil and gas, is a safe and cost effective fuel for reducing energy bills that has not reached its full potential. The Propane Education & Research Council is making inroads in the effort to increase awareness of propane as an alternative resource. There is a lot riding on PERC‟s assessment of market potential, and providing funding for the right idea could turn the tide for propane the way the light bulb did for electricity. PERC‟s challenge is to evaluate the impact of each project on the propane market, prioritize it, and demonstrate its value to the propane producers funding the organizations. PREC had Osborn & Barr Communications develop a series of research projects that would eventually help PERC prioritize and fund new technologies that would change the nature of farming. A comprehensive, user-friendly research matrix now allows PERC to identify and quantify market potential for new agricultural technologies such as thermal agriculture, crop drying, engines, food safety, waste treatment, and other agriculture production areas. When developing the report Jeff Whetstine of Osborn & Barr suggested that in the development of the research report that did not aim to tell PERC where they should invest, but instead wanted to provide them with the appropriate information to make the best decisions. W hat is the role of the report? Whetstine says, “let the data speak for itself.” Should researchers go beyond this to making recommendations? How do clients decide whether or not to use research reports? Learning Objective 14.1 Review Question 14.1 Review Question 14.2 Learning Objective 14.2 Review Question 14.3 1 THE RESEARCH REPORT I. Research Report Objectives
  • 4. A. Research Report 1. Explain why the research was done 2. State the specific research objectives 3. Explain how the research was done 4. Present the Findings of the Research 5. Provide conclusions and recommendations B. Organizing the Report 1. Title page–dominated by the name of the project–the name of the client organization, name o the research firm, and date of the report. 2. Table of contents–should not exceed one page and should list the major sections of the report with the page numbers. 3. Executive summary–most difficult part of the report to write–it must be succinct–cover the key findings and any recommendations that flow from the findings. See Exhibit 14.1 Sample Bulleted List from Executive Summary (p 471) 4. Background–sets the context for the research and addresses such things as the overall goal of the research, the decisions that need to be made, the company‟s strength and weaknesses regarding the issue in question. 5. Methodology–how the research was done and why it was done that way. 6. Findings–the longest section of the report and should summarize results for almost every question on the survey. 7. Appendixes a. Copy of the questionnaire b. Cross-tabulations c. Other supporting material C. Interpreting the Findings 1. Executive Summary–the portion of a research report that explains why the research was done, what was found, what those findings mean, and what action, if any, management should undertake. Learning Objective 14.3 Learning Objective 14.4
  • 5. 2. Conclusions–generalizations that answer the question raised by the research objectives or otherwise satisfy the objectives. a. The conclusion of a research report should be a statement or series of statements that communicate the results of the study to the reader but would not necessarily include any of the data derived from the statistical analysis. D. Format of the Report 1. Presentation Software a. Create bulleted charts using various font styles and sizes with bold, italicized and underlined text. b. Develop various styles of charts and graphs and to experiment with different types of graphs (pie, bar, line, and so on) in an attempt to find the most efficient way to display a particular research finding. c. Apply other kinds of special formatting and organize pages to most effectively tell the story. See Exhibit 14.2 Sample Presentation of Customer Satisfaction Results (p 471) 2. Predominate Reporting Style Characteristics a. It minimizes the use of words b. It feeds information to clients in what might be termed graphical „minibites‟. c. Graphics, text boxes, bulleted lists, and the like are used to interpret the meaning of various graphs. E. Formulating Recommendations 1. Recommendations–conclusions applied to marketing strategies or tactics that focus on a client‟s achievement of differential advantage 2 THE PRESENTATION I. Presentation Materials Learning Objective 14.5 Review Question 14.4 Effective communication in the presentation is absolutely critical. This may be the only exposure to the findings that some decision makers in the company will see. A. Two Aids for a Presentation
  • 6. 1. Visuals–The PowerPoint presentation–slides should be succinct and relevant– format should follow that of the report. 2. Copies of the final report–report serves as physical evidence of the research–comprehensive nature makes clear that it includes much detail that was omitted in the presentation–available to interested parties at the end of the presentation. B. Making a Presentation 1. Tailored to the Audience a. Receivers‟ frame of reference b. Attitudes c. Prejudices d. Educational background e. Time constraints 2. Reason Presentation Can Be Inadequate a. Lacks an understanding of the barriers to effective communication. 1) Select words, concepts, and illustrative figures to which the audience can relate. b. Speaker fails to recognize or admit that the purpose of many research reports is persuasion. 1) Persuasion–using research findings to reinforce conclusions and recommendations. 3. Keep the following questions in mind when preparing for the presentation. a. What do the data really mean? b. What impact do they have? c. What have we learned from the data? d. What do we need to do, given the information we now have? e. How can future studies of this nature be enhanced? f. What could make this information more useful? See Exhibit 14.3 Multiple Graphs on a Page Tell a Story (p 472) See Exhibit 14.4 Graphs and Tables on the Sam Page Maximize Communication (p 473)
  • 7. See Exhibit 14.5 Different Types of Graphs and Tables Convey a Lot of Information Quickly (p 474) See Exhibit 14.6 Multiple Measures on a Single Satisfaction Item Conveyed on a Single Page (p 475) Learning Objective 14.6 3 PRESENTATIONS ON THE INTERNET With PowerPoint, publishing presentations to the Web is easier than ever. Publication to the Web enables individuals to access the presentation, regardless of where they are or when they need to access it. In addition, researchers can present results at multiple locations on the Internet. 4 MARKETING RESEARCH SUPPLIER MANAGEMENT I. What Do Clients Want? A. Top Ten List 1. Maintains client confidentiality 2. Is honest 3. Is punctual 4. Is flexible 5. Delivers against project specifications 6. Provides high quality output 7. Is responsive to the client‟s needs 8. Has high quality-control standards 9. Is customer oriented in interactions with client 10. Keeps the client informed throughout a project. B. Communication 1. Key to Good Supplier-Client Relations–communication 2. Liaison–every project should have a liaison who serves as a communication link between the supplier and the client. a. Must communicate accurately honestly and frequently with the client. b. Should go over the project objectives, methodology, and timing with the client.
  • 8. Review Question 18-5 c. Client should sign off on the questionnaire. d. Ascertain how often the client wants progress reports–include status of the project, unusual problems encountered, and, if it is a cost- plus project, expenses incurred to date. 1) Cost-plus–to actual costs plus an additional markup to cover overhead. C. Managing the Research Process 1. Research Management–overseeing the development of excellent communication systems, data quality, time schedules, cost controls, client profitability, and staff development. 2. Organizing the Supplier Firm–traditionally organized around functions–this allows technical people to perform backroom tasks such as programming and data analysis and the “people people” to hand project management and client contact a. In response to some of the problems created by this type of organization, some companies are organizing by teams– breaking up functional department and organizing their staff into units based around client groups or research types. 3. Data Quality Management a. Integrity and Quality of Data–research management is to ensure this factor. b. Procedures–to ensure the careful proofing of all text, charts, and graphs in written reports. 4. Time Management a. Keep project on schedule b. Two problems that can play havoc with time schedules 1) Inaccuracies in estimates of the incidence rate–percentage of persons or households out of the general population that fit the qualifications to be interviewed in a particular study. 2) Interview length c. System to Control Schedules–system in place to inform management if project is on schedule or not. 5. Cost Management–procedures for cost control a. Systems that accurately capture data collection and other costs associated with the project on a daily basis.
  • 9. b. Daily reporting of costs to project managers. c. Policies and practices to communicate the budget picture. d. Policies and practices that quickly identify “over-budget” situations. e. If the project is over budget, the client should be offered options early in the process regarding higher costs, smaller sample size, shorter interview or some combination of the three. D. Client Profitability Management 1. Old Adage–20 percent of the clients generate 80 percent of the profits‟ a. Example of Custom Research Incorporated experience with too many clients and how they handled the situation. See Exhibit 14.7 CRI’s Client Profitability Analysis (p 481) See Exhibit 14.8 Screening Questions Used by CRI and the Rationale for Each Question (p 481) E. Staff Management and Development 1. Primary asset of a marketing research firm–people 2. Suggestions for staff development in a research firm: a. Create an environment that encourages risk taking, experimentation, and responsibility. b. Foster recognition and accountability c. Provide job autonomy d. Attract and support people with entrepreneurial attitudes e. Connect rewards to a business result f. Open your financial books g. Offer diversity within your organization h. Provide clear promotional paths 5 MANAGING A MARKETING RESEARCH DEPARTMENT I. Selecting the Right Marketing Research Suppliers A. Steps in Selecting a Research Supplier
  • 10. 1. Determine the project‟s requirements–nature, scope, and objectives 2. Assess the capabilities of alternative suppliers a. Do the vendors have a particular area of specialization? b. Are the firms committed to a particular technique and/or data collection method? Learning Objective 14.7 Review Question 14.8 Learning Objective 14.8 Review question 14.9 3. Consider the size of the firm–it is an important decision criterion–if a small firm they can be overwhelmed with an enormous project. 4. Establish up front the individual who will be managing the project. 5. Research department manager needs to become acquainted with the backgrounds of the potential vendors. 6. Questions should be asked to determine the stability of the company and its qualifications to complete the project, such as: a. How long has the vendor been in business? b. For what other companies has the vendor conducted research projects? c. What are the academic backgrounds and experience of those persons who will be working on the project? d. Does the success of the project depend on the capabilities of a subcontractor? 7. Review the quality control standards of each potential vendor. 8. The reputations of the firms must be considered in the decision. 9. Avoid letting price be the sole determining factor in the selection. II. Moving Marketing Research into a Decision-Making Role A. Role of Marketing Research in the Managerial Decision-making Process 1. The researcher‟s challenge is to shed their long-held traditional role as a support function, one that reacts to requests from project and new product development managers and then focuses on producing the numbers but not on their meaning to the business. 2. Researchers must move beyond the task of simply crunching numbers and churning out results; they need to understand the underlying business
  • 11. issues at stake and adjust the information they gather and how they analyze it. They must reach out to other departments, building relationships and a better understanding of the issues companywide. See Exhibit 14.9 A researcher’s Route to the Table (p 486) B. Measuring Marketing Research’s Return on Investment (ROI) 1. Marketing expenditures–investments, with performance measures which come from finance–the approach being used is Return On Investment (ROI) 2. Arguments against the use of ROI a. ROI is theoretically flawed because it divides the profit return by the expenditure instead of subtracting it. b. ROI was invented to compare alternative uses of capital, based on their projected percentage return on that capital. c. Improving ROI tends to suboptimize expenditure d. ROI usually focuses on the short term and does not consider the effects on the marketing asset (brand equity) or the dynamic development of marketing over longer time periods. e. Purpose of the ROI ratio it to compare alternative expenditures. 3. Examples of ROI Lite and ROI Complete 6 SUMMARY