Marketing managers often commission formal marketing studies of specific problems and opportunities. They may request a market survey, a product preference test, a sales forecast by region, or an advertising evaluation. It is the job of the marketing researcher to produce insight into the customer’s attitudes and buying behavior. We define marketing research as the systematic design, collection, analysis, and reporting of data and findings relevant to a specific marketing situation facing the company. Marketing research is now about a $16.5 billion industry globally, according to ESOMAR, the world association of Opinion and Market Research professionals.
Procter & Gamble
P&G’s large market research function is called Consumer & Market knowledge (CMK). Its goal is to bring consumer insight to decision making at all levels. Dedicated CMK groups work for P&G businesses around the world, including global Business Units (GBU), which focus on long term brand equity and initiative development, and Market Development organizations (MDO), which focus on local market expertise and retail partnerships. There is also a relatively smaller, centralized corporate CMK group which, in partnership with the line businesses, focuses on three kinds of work:
1.Proprietary research methods development,
2.Expert application of, and cross-business learning from, core research competencies, and
3.Shared services and infrastructure.
CMK leverages traditional research basics such as brand tracking. CMK also finds, invents, or co-develops leading-edge research approaches such as experiential consumer contacts, proprietary modeling methods, and scenario-planning or knowledge synthesis events. CMK professionals connect market insights from all these sources to shape company strategies and decisions. They influence day-to-day operational choices, such as which product formulation are launched, as well as long-term plans, such as which corporate acquisitions best round out the product portfolio.
Yet, marketing research is not limited to large companies with big budgets and marketing research departments. At much smaller companies, marketing research is often carried out by everyone in the company — and by customers, too.
Karmaloop bills itself as an online urban boutique, and it has built its reputation as a top shop for fashions because of its relentless tracking of trendsetters. The five-year-old Boston Company has made street wear fashion a science by keeping tabs on young tastemakers’ buying habits. In addition to its crew of 15 moonlighting artists, DJs, and designers, Karmaloop recruits street team members to ferret out new trends and to spread the word about Karmaloop brands. The street teams, which now boast 3,000 reps, pass out fliers and stickers at nightclubs, concerts, and on the street, but also report on what they see at events, in the way of trends.
Companies normally budget marketing research at 1 to 2% of company sales. A large percentage of that is spent on the services of outside firms. Marketing research firms fall into three categories:
Syndicated-service research firms: These firms gather consumer and trade information, which they sell for a fee. Examples: Nielsen Media Research, SAMI? Burke.
Custom marketing research firms: These firms are hired to carry out specific projects. They design the study and report the findings.
Specialty line marketing research firms: These firms provide specialized research services. The best example is the field service firm, which sells field interviewing services to other firms.
A company can obtain marketing research in a number of ways. Most large companies have their own marketing research departments, which often play crucial roles within the organization.