Research Priests and the Low-Budget Manager - Marketing Research

Many managers with limited research experience hold misperceptions about marketing research. These misperceptions can be traced to the marketing research community, which has created a forbidding mystique about its own profession and its products. Marketing researchers have developed their own jargon, their own reverence for the most sophisticated approaches, and their own propaganda that implies that only those who are properly trained—the research priests—can conduct valid, reliable marketing research.

In some cases, they are correct. Professionals should be the prime sources of research on such sensitive topics as drugs and sex or of research designed to tap complex or deeply rooted mental processes. Professionals must also be used when results have to be projected with a high degree of accuracy to a general population base or to some distant future period. They must also be used where the research is likely to be subject to close outside scrutiny, for example, by the government or the courts. And when a lot is riding on the outcome of a decision or set of decisions that must be based on research, paying for the very best professional work is clearly justified.

But many, many marketing decisions could benefit significantly from marketing research that would not involve a high level of sophistication or expenditure levels that mortgage the organization’s future. There are a great many research alternatives that can easily
be designed and implemented by any minimally knowledgeable manager or his or her staff. This book is designed to encourage and instruct these people to try their hand at marketing research. It is designed to give the neophyte manager-researcher the basic knowledge necessary to permit frequent and sensible use of a wide range of low-cost marketing research tools.

Many managers are intimidated about carrying out their own marketing research because of myths that have developed over the years. If this book is really to be helpful to its readers, we must first bring these myths into the open and confront them directly.

“I’m Already Doing Enough Research”

Many managers believe they already have enough marketing research information as a by-product of their organization’s accounting and control activities. They point to stacks of performance data, profitability analyses, and so forth as proof of their contention. Although such information may be useful as research, the odds are very good that it is both too much and too little. The problem typically is that no one has ever really sat down and tried to specify just what kind of information the manager should have for day-to-day marketing decisions or long-range strategic planning. Thus, the manager is offered only what is available and often in overwhelming abundance. Too much of the wrong kind of data can swamp what is really important. The manager is often left to find the proverbial needle in the haystack.

Data overkill, by its sheer bulk, can intimidate many managers from looking for these needles, while at the same time convincing them that the company is already doing enough marketing research. Certainly the prospect of going into the field and generating even more new and different data will seem highly unpalatable to the overwhelmed manager.

And, of course, the available data may also be too little. As long as the manager keeps making decisions that could have been significantly helped by a few modest additional research projects, we must conclude that the existing information is clearly inadequate.
It is Gresham’s Law applied to marketing research: bad data drive out good data. An overabundance of useless data is bound to quash any modest ambitions to collect more.

The only way to deal with the problem of data overkill is to systematically identify the organization’s long-run research needs and ask whether existing data meet these needs. In most cases, they will not, and the researcher will have to build a research program to
meet those needs and find ways of turning off the supply of useless, inhibiting data. Simply hoping that existing data will be adequate is not enough. If existing data are not carefully designed to help make both short- and long-term decisions, they are probably just accounting or output data and should not be classified as research.

“Research Is Only for Big Decisions”

Many managers in small businesses or nonprofit organizations suffer from misplaced modesty. They feel that their decisions are small potatoes compared to those of Procter & Gamble or General Motors. They feel they cannot justify the level of expenditures they
think any serious marketing research undertaking will require. This kind of thinking has two major flaws. First, there are many circumstances in both small and large companies where relatively trivial decisions can be significantly improved by a little bit of marketing
research and where the research is well worth doing because of its modest cost.

Second, despite what many managers think, there are many situations, even in very large organizations, where marketing research is not justified, even though substantial amounts of resources are at risk. The reason a lot of big decisions do not require research expenditures is that management already has little uncertainty about what to do. By contrast, as we will see in Chapter Three, it is in cases where managers simply do not know which way to turn (even where the stakes are relatively modest) that research can be most helpful. The dollars at risk will, of course, determine the upper limit of the
research budget, and therefore, other things equal, bigger decisions will permit more research. But even where relatively modest amounts are involved, if the situation is one of high uncertainty as to what to do, there is usually some level of research expenditure that a manager should accept because it is very likely to tip the balance one way or another.

In many situations with large amounts of money at risk, managers will order research even though it is not justified rationally. Managers often want to feel better about a major decision they are about to make. They may want backup in case the decision is later questioned. In both cases, the manager should recognize that funds allocated to unjustified self-protection are funds that probably should be used to provide information in other contexts that now require management by the seat of the pants.

“Losing Control”
The lost-control myth in part reflects the deeply rooted perceptions of many managers that marketing research is really some arcane religion to which only a very few priests are admitted. They believe that they cannot acquire the level of sophistication needed to do the research alone or specify what research needs to be bought from outside sources. If managers feel they must go outside for any research, many will refrain from going ahead because they feel that they dare not rely on others to gather and analyze data about their decisions. They feel they will have committed a part of their organization’s destiny to an outsider who may or may not understand the situation or the realities of its unique political and market environment. In a sense, the managers feel they have lost control.

This would explain why many managers who recognize possibilities for research do not simply hire smart M.B.A.s to do in-house studies or hire outside contractors to fill in critical information gaps. The manager fears losing control. If new information is allowed to become important to decision making and only certain people (not the manager) have access to this specialized information, then they, not the manager, may really have the control. The manager will be beholden to them.

This fear keeps managers from engaging in research and then from using the results of research when it is (grudgingly) carried out. This is especially the case if the research results run counter to the manager’s own views. Most of us are reluctant to accept new information, and the problem is significantly exaggerated when managers feel that agreeing with unexpected research results and acting on them means giving up real control of their function.

Understandably, this fear of loss of control is a particular problem for middle managers and those in small or nonprofit businesses. Personal survival is very important to them, and they often feel they dare not give others the control of their personal organizational fate.

They may also feel that the entire organization is at risk. Organizational fragility is a real and understandable concern of small businesses. If one believes that research is hard to understand and requires a translation to be used effectively, certainly one will be reluctant to delegate one’s very livelihood to outside specialists. The outside researcher may not work as hard on the project or on the analysis and interpretation as the manager would like. Worse still, busy outsiders may unwittingly bias the results, understate or neglect key issues, or suppress important reservations.

Finally, many managers worry that outside researchers will be on some theoretical or academic plateau far above the practical realities facing the organization. This will be especially so if the manager has glanced recently at specialized journals in the marketing research field with their articles talking of “part-worth’s” “canonical coefficients,” “Cronbach’s Alpha,” or “Durbin-Watson statistics.”

These fears are not easily reduced. However, this book is designed to make the manager a more savvy research user, one who knows when to hire outsiders and when to go it alone. It introduces a number of very good but not fancy research techniques that the cautious manager can order from outside or do in-house without fear of being unknowledgeable or unprepared. Should the manager have to go outside, the book also describes (in Chapter Four) an excellent technique that can ensure that what is done is on target and highly useful.

“Market Research Is Survey Research”

Just as many no marketing people tend to think that marketing is just advertising, so do many managers tend to think of survey research and marketing research as being virtually the same thing. There is a great range of research techniques that use simple observation, archival analysis, and low-cost experimentation rather than surveys.

“Market Research Is Too Expensive”

This is the major straw-man myth that this book is designed to knock down. It exists, in part, because of myth 4. If one equates marketing research with surveys with their large samples, substantial field costs, complicated computer analyses, and so on, it is inevitable to assume that research has to be expensive. Surveys based on careful probability sampling are expensive, but there are many alternatives to survey research that can adequately meet management’s information needs at low cost. Furthermore, there are many ways in which the cost of survey research itself can be significantly reduced.

“Most Research Is a Waste”

Research can turn out to be wasteful for many reasons. This book is expressly designed to make sure managers avoid such a fate.

There can be many culprits behind wasted research. Sometimes research is wasted because the manager has personal motives for not effectively using the research after it is done. Inexperience, time pressure, or relying too much on the research supplier can also lead to miscommunication that will virtually ensure that the research cannot be useful. Often the researcher is an equally guilty culprit. Some research specialists keep a distance from management simply to protect their own special status. Sometimes the researcher, whether by training or inclination, is not adequately concerned about making the research
project managerially relevant. This is especially common among academics and freshly graduated Ph.D.s. The researcher may be so caught up in the world of research sophistication that he or she may not really understand, or may have strange ideas about, managerial relevance. It is not uncommon to hear researchers talk about the quality of the design itself or the statistical significance of the results as the true test of whether research was good, rather than how relevant it was to the manager who asked for it.

Finally, the problem may simply not be the fault of anybody or caused by a lack of trying. In many cases where both sides really want to make the research managerially useful, the parties do not have a procedure that can make a piece of research managerially relevant and useful. Chapter Four specifically sets out a procedure that can go a long way toward ensuring a productive manager researcher collaboration.

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