Management research

National Institute of
Business Management
Master of Business
Administration (MBA)
Management Research

Chapter Title Page No.
I MARKETING RESEARCH 5
II DATA COLLECTION 52
III SAMPLING 68
IV CONCEPTS OF MEASUREMENT AND SCALING 83
V DATA PREPARATION AND PROCESSING 94
VI ANALYSIS OF DATA 108
VII INTERPRETATION AND REPORT WRITING 119
CONTENTS
CONTENTS
CONTENTS
CONTENTS
CONTENTS

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CHAPTER - I
MARKETING RESEARCH
OBJECTIVE
Marketing research is a form of business research. and Business-to-Business (B2B)Marketing
Research, or Business Marketing Research, previously known as Industrial Marketing Research.B2B
Marketing Research investigates the markets for products sold by one business to another, rather
than to consumers.
Consumer Marketing Research is a form of applied sociology which concentrates on
understanding the behaviours, whims and preferences, of consumers in a market-based economy.
Market research is the process of systematic gathering, recording and analyzing of data about
customers, competitors and the market. Market research can help create a business plan, launch a
new product or service, fine tune existing products and services, expand into new markets etc. It can
be used to determine which portion of the population will purchase the product/service, based on
variables like age, gender, location and income level. It can be found out what market characteristics
your target market has. With market research, companies can learn more about current and potential
customers.
The purpose of market research is to help companies make better business decisions about
the development and marketing of new products. Market research represents the voice of the consumer
in a company.
A list of questions that can be answered through market research:
• What is happening in the market? What are the trends? Who are the competitors?
• How do consumers talk about the products in the market?
• Which needs are important? Are the needs being met by current products?
Marketing is very much concerned with satisfaction of customer needs through better
products and services. Marketing starts with the customer needs and ends with products to satisfy
these needs. Unless these needs and wants of the customers are assessed, products cannot be designed
to suit the requirements and ultimately to the satisfaction of the customers.
Manufacturers of all products are running their own race, a race that never seems to end.
Now a day, markets are flooded with different products and services from a large number of

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companies. The buyers have become choosy. In this dynamic environment, the company has to
continuously change its plans and strategies to suit the changes taking place in the environment.
Thus, the evolution of marketing research is brought about by two factors:
1. The suppliers of products and services need to have information about final customers in order
to market their products and services more effectively.
2. As a company grows and starts distributing its products in a number of different markets, the
managers of the company find themselves more separated from the final customers of their
products. This is because many of the manufacturers distribute their products through their
own sales personnel to wholesalers, who in turn sell it to retailers, who then pass it on to the
final customers.
Marketing manager needs information on various topics like target market, product / services,
price distribution, promotion, etc. Marketing management functions like planning, implementation and
control relating to marketing mix are also performed in an effective manner only when information on
marketing mix elements (product, place, price and promotion) and environmental forces (customer
needs and activities, marketing structure and reactions, competitor’s strategies, dealer demands, supplier
policies, etc) are made available to marketing executives at various levels of management.
The first evidence of formal techniques of marketing research could be traced back to the
year 1824. For almost one century thereafter, marketing research developed rather slowly and it was
only from 1990 onwards that it made rapid strides. The growth of marketing research since 1880
can be classified into six stages.
1880-1920 – The industrial statistics phase.
1920-1940 – The phase of random sampling, questionnaire and behavioral measurement
development.
1940-1950 – The management awareness phase.
1950-1960 – The experimentation phase.
1960-1970 – The computer analysis and quantitative methods phase.
1970 onwards – The consumer theory development phase.

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Marketing Research Defined
One of the most powerful tools available to marketers is marketing research, which was
traditionally defined as the systematic gathering, recording and analyzing of information to help managers
make marketing decisions. This definition implies that the marketing research professionals play only
a supporting role in the marketing process.
But marketing research in 1990s has become an integral part of decision making process.
So the definition has expanded.
The American Marketing Association defines Marketing Research as:
Thefunctionthatlinkstheconsumer,customerandpublictothemarketerthroughinformation–
information used to identify and define marketing opportunities and problems; generate, refine and
Customers
Economic
Technological Social
Product
Policies
Dealers’
Demands
Suppliers’
and activities
MarketingEnvironment
Customer needs
Promotion Price
Place
Competitors Strategies Market structure
& reactions
Psychological Legal

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evaluatethemarketingactions;monitormarketingperformanceandimproveunderstandingofmarketing
asaprocess.Marketingresearchspecifiestheinformationrequiredtoaddresstheseissues;designsthe
methodsforcollectinginformation;managesandimplementsthedatacollectionprocess;analyzesthe
results;andcommunicatesthefindingsandtheirapplications.
Criteria for Good Research
Whatever may be the type of research works and studies, one important feature is that they
all meet on the common ground of scientific method employed by them. One expects a scientific
research to satisfy the following criteria:
1. The purpose of the research should be clearly defined and common concepts be used.
2. The research procedure used should be described in sufficient detail to permit another
researcher to repeat the research for further advancement, keeping the continuity of what
has already been attained.
3. The procedural design of the research should be carefully planned to yield results that are as
objective as possible.
4. The researcher should report with complete frankness, flaws in procedural design and estimate
their effects upon their findings.
5. The analysis of data should be sufficiently adequate to reveal its significance and the methods
of analysis used should be appropriate. The validity and reliability of the data should be checked
carefully.
6. Conclusions should be confined to those justified by the data of the research and limited to
those for which the data provide an adequate basis.
7. Greater confidence in research is warranted if the researcher is experienced, has a good
reputation in research and is a person of integrity.
The qualities of a good research can be stated as follows:
1. Good research is systematic – It means that the research is structured with specified steps
to be taken in a specified sequence with well defined set of rules. Systematic characteristic
of research does not rule out creative thinking.
2. Good research is logical – Research is guided by the rule of logical reasoning and the logical
process of induction and deduction is of great value in carrying out research. Induction is the
process of reasoning from a part to the whole whereas deduction is the process of reasoning
from such premise to a conclusion which follows from that very premise. Logical reasoning
makes research more meaningful in the context of decision making.

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3. Good research is empirical – It implies that research is related basically to one or more
aspects of a real situation and deals with concrete data that provides a basis for external
validity to research results.
4. Good research is replicable – This characteristic allows research results to be verified by
replicatingthestudyandtherebybuildingasoundbasisfordecisions.
Marketing Information System and Marketing Research
Prudent managers have to anticipate the changes in the environment, have to assess the
direction and extend of these changes and reconcile their marketing planning to suit these changes.
To fulfill these functions, effective management of information is needed. Information may be available
both internally and externally. Marketing Information System sorts out this information and puts it to
effective use. This system is an aid to managers in decision making. Marketing Information System is
comprehensive and includes marketing research as one of the components.
Marketing Information System is required for the following reasons:
1. Fast decisions: - Executives are expected to react fast to changes and manage new product
launches.
2. Complexity of marketing: - Marketing has become more comprehensive and broader. Hence,
it requires a good information system.
3. Era of shortages: - Shortages of resources like energy and other raw materials make it
compulsory for management to keep only viable products in the product line.
4. Consumer awareness: - Since consumer expectations are high and to live up to it, managers
need information.
5. Information explosion: - Makes it necessary to process it so that best use is made out of it.
Marketing Information System is an interacting, continuing, future-oriented structure of people,
equipment and procedures. It is designed to generate and process information and to ensure flow of
it to aid decision making in a company’s marketing problems.
The various elements of Marketing Information System are inputs from the macros, micros
and internal environment. These inputs are processed to generate output in the form of periodic reports
and special reports.

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Processing
The System has to decide
(1) What are needed?
(2) How to gather this data?
It then processes this data:
(i) By making use of quantitative/ analytical technique
(ii) By using computers.
MIS is future oriented and continuous. The information stored can be used to cure present
problems and also to prevent future problems.
Benefits of Marketing Information Systems
1. It provides effective use of information gathered.
2. It provides faster, less expensive and more complete information flow.
3. Executives receive reports more often and in detailed form.
4. Makes feasible retrieval of data.
5. Constant monitoring of marketing mix possible.
Marketing Decision Support System (MDSS)
Marketing Decision Support System (MDSS) is a computerized system of accessing and
handling MIS data and other data so that marketers can apply analysis and modeling methods and
immediately see the results. The advantages of MDSS are:
Macro
Environment
Internal
Environment
Micro
Environment
Processing Special
Report
Periodic
Reports
Output
Input

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1. The flexibility of combining large quantities of data drawn from variety of sources.
2. Evaluation of large number of scenarios is possible in a short time using a wide spectrum of
methods.
3. Immediate answers to questions because the data and the analysis methods are computerized
and readily available.
Advantages and Limitations of Marketing Research
Marketing research forms an inevitable part of any marketing process. This is because it
possesses the following advantages.
1. Marketing research makes situational analysis and thus puts the problem in a proper
perspective.
2. Marketing research begins the marketing activity by assessing consumer needs and aspirations.
It further assists product development right from concept testing to test marketing.
3. Marketing research helps to formulate hypotheses for further research.
4. Qualitative marketing research throws open consumer’s innermost motivations.
5. Marketing research is predictive.
6. Marketing research helps advertising process in the following areas:-a) Identification of target
audience b) Identification of theme c) Pre-testing of copy d) Post- testing of copy e) Media
effectiveness.
7. Marketing research helps the formulation of marketing strategies.
But there are certain limitations too.
1. Marketing research is not an exact science and cannot claim the accuracy of the physical
sciences.
2. Marketing research is conducted in a market place where several variables are at work. The
conditions are not controlled as in the laboratory experiments.
3. Since marketing research deals with human beings, it cannot rule out an element of artificial
response from them when they are subjected to the process of marketing research.
4. Marketing research findings are difficult to verify. They may be subjective too.
5. Marketing research becomes outdated by the time the project is over because the market
situation is dynamic.
6. Marketing research findings may be biased on account of the research workers or on account
of the respondents.

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7. Lack of training to the researchers may generate faulty marketing research findings. Many
times research problems and objectives are not properly defined. Due to resource crunch
(money and time) good marketing research may not be possible. Many researchers may not
be computer literate. Certain pre-conceived notions are to be supported by the research data.
Applications of Marketing Research
Marketing research is a key element throughout the marketing process. There are different
situations in which the marketing research finds its application. A few of them are:-
— Marketers rely on research when they set goals for market share, product profitability or a
program’s sales results.
— They also use marketing research when developing new products, when identifying profitable
target markets and when planning future marketing programs.
— During a marketing campaign, marketers use research to monitor the program’s effectiveness
by answering such questions such as how many consumers are using a product and how many
consumers buy a product more than once.
— Marketers use marketing research to keep an eye on competition.
— Understanding customer satisfaction is another application of marketing research.
When considering the marketing mix elements, the different areas where marketing research finds its
applicationaregivenbelow:
Product or Service Research
Studies conducted regarding concepts and positioning of the products. Some examples are:
— Customer acceptance of proposed new products.
— Comparative study of competitive products.
— Market testing of proposed product.
— Study of customer satisfaction with the product.
— Product line research.
— Packaging and design research.
— Research on present and potential customers of company’s products and services.
— Research on customer images, attitudes, wants and needs to improve the quality of the product.
MARKET RESEARCH
A study of size, location, nature and characteristics of markets i.e., research on market place.
Examples are:-

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— Analyzing market potential for existing product.
— Estimating demand by sales forecasting.
— Studies on market trends.
Research on Promotional Policies
Research on all promotional policies which include personal selling research, advertising
research, public relations research and sales promotion research.
Examples are:
— Measurement of advertising effectiveness.
— Advertising and sales promotion strategies.
— Selection of advertising media.
— Designing advertising copy and testing.
— Evaluating present and proposed sales methods.
— Evaluating promotional tools.
— Evaluating effectiveness of salesmen and estimating quota for them.
— Study of competitors promotional mix.
Research on Distribution Policies
It includes studies related to location and design of distribution outlets, transportation and
logistics surveys, dealer surveys etc. Examples are:
— Design of distribution channels.
— Location of warehouses.
— Cost analysis of various distribution mix like warehousing, transportation, inventory control
and material handling.
— Dealer supply and storage requirements.
— Study of functions to be preformed by middlemen.
Research on Pricing Policies
It includes pricing studies about elasticities, marginal analysis, cost analysis and perception
regarding prices. Examples are:
— Research on discounts, allowances.
— Research on pricing strategies.

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— Research on new product pricing.
— Pricing policies for different stages of product life cycle.
Consumer Research
Such aspects like who is the target audience, what do they expect, how do the customers
behave and why do they behave like that, are answered by consumer research studies. Few examples
are:
— Study of consumer attitudes.
— Study of consumer preference to the company’s product.
Corporate Responsibility Research
The company might be interested to see whether the consumers are unintentionally harmed
by the company by adding to the pollution of the environment, adding to the social cost, excessive
expenditure on packaging and promotion, not allowing consumers to know about the product quality
and manufacturing etc. This area of research is gaining significance because of increasing consumer
awareness.
Miscellaneous Research Activities
All researches which cannot be included in any of the above heads come under miscellaneous
research activities. Examples are:
— Research on diversification.
— Satisfaction and motivations of sales personnel.
— Government attitude to corporate sector.
— International marketing and research
The Application of Marketing Research at Different phases of the Administrative
Proces.
There are four phases at which a marketing research finds its application. They are:
1. Setting goals and establishing strategies:-
Useful information can be obtained on a variety of topics when managers attempt to select
a new strategy to pursue. Changes in size or trend of demand – or changes in the structure or
composition of the market – may suggest that a new strategy is appropriate. Changes in media trends
(for eg:- growth of cable television) may signal the emergence of an opportunity that might be exploited
with certain new strategies. Needs, wants and/ or dissatisfactions in relevant market segments may
suggest that a problem exists, waiting to be solved and hence the right strategy can be identified.

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2. Developing a marketing plan:-
When developing marketing plans, managers often use marketing research to identify key
market segments. By measuring this attitudes and opinions towards the features of available products
and how these products are used, managers can identify important product and advertising
considerations to include in their plans. Marketing research can also be used to test how appealing
certain proposed product attributes and advertise-ments are to the target market.
3. Putting the plan into action:-
When a plan is put into action, management must monitor the effects of the plan to see if it
is achieving its objectives. For this, marketing research is used.
4. Evaluating the plan’s effectiveness:-
At the end of the operating period, the management will want to re-appraise the plan and
compare results with the objectives. Such a re-appraisal will involve an aggregation and compilation
of most of the information obtained during the planning and action phases, with a special emphasis on
sales, market share, marketing cost and contribution to profit etc.
Marketer and the Marketing Research
Marketing research helps to take guesswork out of marketing decisions, but it is also
important for marketers to use their own experience and common sense when they plan and apply
marketing research. When people rely on experience, personal knowledge and feelings about a subject,
they are using intuition.
The design and execution of the actual marketing research must be based on the scientific
method, a process of systematically collecting, organizing and analyzing data in unbiased objective
way. One of the considerations in applying the scientific method to marketing research is whether the
research will have reliability which means the same study could be repeated over and over again and
produce the same results each time. The research should also have validity that is the research must
actually measure what it was designed to measure, telling researcher what he exactly needs to know.
In business, several decisions are to be taken under uncertainty. Greater the uncertainty, the
more difficult it is to take the decision. If the management is supported by a good marketing team
and an information system, the degree of uncertainty can be reduced. Only when research is both
valid and reliable, marketers can trust the results and use them as the basis for decision marketing.
When management gathers information it incurs some cost. It is therefore necessary to
consider both the cost and advantage or value of Information to be collected. As long as the value
of information exceeds the cost of its collection, the management may decide to go ahead. When the
cost of information equals its value, there is no advantage to be gained in collecting the same. The
cost of obtaining information normally increases with the period of research after a certain time whereas
if the period of research is very long, then the value of information collected starts declining. The net

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value indicates the difference between the value and cost of information and varies from point to point.
At one point of time, the difference will be maximum.
The increasing importance of marketing research both as an activity and also as use of funds
suggests the need to evaluate more careful method of making marketing research decision a success.
Scientific Method of Research
It is the function of marketing research to reduce the degree of uncertainty in a decision.
Whenever managers use research, they are applying the methods of science to the art of marketing.
Scientific method, more than any other procedure, can minimize these elements of uncertainty which
result from lack of information. As seen earlier, validity and reliability are two traits that characterize
the scientific method.
Scientific Method in the Physical Science and Marketing
The scientific method as a method of reducing uncertainty stemming from a lack of information,
has been developed primarily in the physical sciences. A centuries old tradition of careful problem
definition, combined with the use of measuring instruments proved through many tests to accurately
measure specific characteristics, provides validity for most physical science research.
Such marketing research also has good validity, but validity questions can be quite subtle.
Measuring instruments used in marketing (e.g. questionnaire) do not provide clear definition of what
is measured as in the case of thermometers and balances. Consumers must interpret questions and
find ways to express answers both of which are imprecise and in marketing, it is very difficult to know
whether the sample drawn is a true representation of the population that the researcher desires to
study.
Cost
Value
Cost and value
Monetary Units
Maximum difference
Time
Period of study

17
In the case of reliability, the physical sciences appear significantly more ‘scientific’ than
marketing. In most physical sciences, the reproducible experiment is the accepted scientific method.
In chemistry, normally experiments are conducted under controlled conditions and variables such as
temperature, pressure and quantities of chemicals are carefully measured and if the experiments are
repeated, any number of times the results arrived will be the same.
In marketing, it is difficult to control all the conditions surrounding a research project and if
the research project is repeated for the second time, the results may be different. Most marketing
research projects are carried out by private firms as one time projects and no attempt is made to test
the validity or reliability of the results.
Distinction between scientific and non- scientific method
Certain criteria distinguish scientific method from other methods. The major differences are:-
The objectivity of the investigator
Researchers must base their judgment on facts, not on preconceived notions or intuition, if
the work is to be scientific. If scientific methods are not used, executives can put pressure on the
researcher to find results that confirm their views.
Accuracy of measurement
The scientific method attempts to obtain the most accurate measurements possible. As the
factors to be measured and the measuring devices available differ from one field of study to another,
the accuracy of measurements differs widely. However, if the measuring methods used in any research
is considered as the best available for that purpose, then, that method may be considered as scientific.
Continuing and exhaustive nature of investigation
A scientific investigation considers all facts pertinent to the problem at hand. No bit of
evidence is passed over because it fails to hit a previously established pattern. Many projects are
independent of previous work. But the best research is done by those who record carefully what
was learnt in one project and used it as a base for the next.
Difficulties in Applying Scientific Method
But in all cases, scientific method cannot be used. Certain general problems are encountered
such as:
1. Investigator involved in use of results
Marketing researchers are involved in the sales of these results either directly (as in the case
of commercial research firm) or indirectly (as in the case of marketing research department of a
manufacturing company). Marketing research data are usually sought for specific decisions that must
be made promptly. Researchers are anxious to see that the marketing organization prospers and as a
result their career. They are therefore anxious for their results to be accepted. This may encourage

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some researcher to find data that support the views of their clients or superiors either by consciously
or unconsciously fudging the data obtained in the research or by drawing conclusions from limited
data.
2. Imprecise measuring devices
As marketing is concerned with people, much of the information collected in marketing
research is obtained by interview which is partially a subjective procedure and it rarely produces precise
measurements. Much of the information relates to opinions and attitudes that at best can be reduced
to quantitative terms in only rough approximation. For Eg. – the strength of an individual’s liking for a
brand of soft drink can be measured only in a relatively crude way when natural science is considered.
All such imprecise measuring methods contribute to lack of reliability in marketing research.
3. Influence of measurement process on results
In marketing research process, it is difficult to obtain the same result when the measurement
is repeated on another time. This is mostly because when humans recognize that they are being
measured, they frequently change. The fact that measuring human attitudes and actions can change
them, results in a lack of reliability and validity in research results. Measurements at other times and
by other researchers may lead to other results and may actually measure something different. Decisions
made with such data cannot be made with complete confidence because of the interaction between
attitudes and the measuring process.
4. Time pressure for results
Marketing research is particularly subject to the pressure of time. For example, in the case
of a new product introduction, marketing research has to be done within a limited time span. As a
result, most marketing research suffers from reliability because it does not benefit from the continuing
and exhaustive study that characterizes the scientific method.
5. Difference in using experiments to test hypothesis
Experimentation is valuable as a research tool because it helps to identify cause and effect
relationships more clearly than any other research design. Unfortunately, the use of experimentation
in marketing research is often impractical or even impossible. It is impossible to control all the factors
affecting product sale. For Eg.- customer attitudes, weather and competitive sales strategies. Therefore,
it is impossible to reproduce the same experiment time after time, and as experimentation is not
completely available to marketing research, lack of reliability becomes inevitable. Experiments are
partially available because methods of statistical control have been developed that permit many useful
marketing experiments.
6. Great complexity of subjects
The most important determinant of marketing activity is the reaction of people to the given
stimuli or more exactly the anticipated reaction of people to stimuli. Thus marketing research is
concerned with individuals who in themselves and in their activities are more complex than the subjects
of the physical scientist.

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The Marketing Research Process
Marketers plan and conduct marketing research by the following five basic steps. They
define the problem, formulate a hypothesis, design the research, collect the data and interpret the
findings for presentation to the management.
Thiscouldbeindicatedbythefigurebelow:
1. Define the problem
A clear description of the marketing problem being researched is the first step. When a
marketing research is undertaken, the researcher knows that there is a problem that must be solved.
But the focus should be narrowed. Each problem definition would lead the researcher to design
the marketing research with a different focus. Therefore, problem definition is an important road
map, showing the direction to conduct the marketing research.
2. Formulate a hypothesis
After defining the problem, the researcher formulates a hypothesis, which is a tentative
explanation about the solution of the problem, which will be proved or disproved by the marketing
research. So hypothesis could be defined as the marketer’s interested assumption about the probable
solution of the marketing problem. Sometimes more than one hypothesis can be developed on a
given problem.
Example
Suppose an electric appliance manufacturer Mr. X saw that the hairdryer sales was
dropping rapidly. To uncover the reason for falling sales, Mr. X decided to conduct marketing
research. He might define the problem in several ways. He might ask ‘what is wrong with the
advertising for my hairdryers?’ or he might ask ‘what is wrong with my packagings’. It can be seen
that, each problem definition would lead him to design the marketing research with a different focus.
And if the packaging was not a problem, but advertising was at fault, he might never uncover this if
the problem definition did not include advertising.
If the problem definition was ‘what’s wrong with my advertising for the hairdryers?’ then
Mr. X would come out with a hypothesis such as “the advertising message is not effective for my
target audience’. As a result of developing this hypothesis, he might come up with another that
Define the
problem
Formulate a
hypothesis
Design the
research
Collect
the data
Analyze,
Interpret &
present the
findings

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could be proved or disproved at the same time such as ‘the advertising is appearing in the wrong
magazine’. The second hypothesis derives from the first and there is a clear relationship between the
two hypothesis and problem definition. But this hypothesis formulation was possible only because the
problem definition was precise.
3. Design the research
Now after the problem has been defined and the hypothesis formulated, the design of the
actual marketing research could be done. This includes three parts:
(i) Determining the type of research
(ii) Identifying the sources of data
(iii) Designing the sample.
(i) Determining the type of research
The type of research naturally depends upon what is expected out of the project. When the
researcher first sets out and needs to get a better picture of the situation, the preliminary research is
generally exploratory, which is a qualitative type of research. On the other hand, once the objectives
have been more precisely defined, the researcher uses either descriptive or causal research or a
combination to collect data because these methods are more qualitative than quantitative.
The types of research would be dealt in detail in the next section.
(ii) Identify sources of data
Once the type of research has been determined, the next step is to pinpoint the sources of
data. The two kinds of data normally used are – secondary data and primary data. Data that have
been collected for the purposes, not specifically for the research being conducted is called as secondary
data. Data that are gathered directly from the subjects or through on site research for a specific
marketing research program is called primary data.
(iii) Design the sample
In this phase of the marketing research process, the researcher starts by identifying the
appropriate population which includes all the people, places or things that are of interest in particular
study. To define the population the researcher needs to know not only who or what you want to
study, but also where and when. Sometimes, it would be difficult to conduct a census. Census is a
survey of every member of the research population. Since a census incurs large cost if the population
is large, usually researchers select a sample which is a portion or a subset of the population that
represents the whole in a research study. It is important to select the right sample because it will be
used to project the reactions, attitudes and behaviors of the entire population and because marketers
will make decisions on the basis of this projection. That is why marketers look at the sampling error,
the difference between the results of surveying a sample of the population and the results that would
have expected if a census of the entire population had been conducted. The term error refers to the
level of precision in using a sample instead of taking a census.

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Samples can’t be expected to yield exactly the same results as a census and some sampling
techniques have higher sampling errors than others. In general, larger the sample, the lower the sampling
error and greater the precision.
When choosing the type of sample to use, the researcher should look at the size of the
possible sampling error, the feasibility of each sampling technique and the cost of conducting the
research. Sampling techniques fall into different categories – probability and non – probability samples.
These are dealt in detail later.
4. Collect data
Next is the collection of data in order to evaluate the hypothesis. Primary data can be
collected either by observation, by surveys and by experimentation. The various methods that are
used to collect data are described later.
5. Analyze, interpret and present the findings
The fifth step in the marketing research process is to analyze, interpret and present the findings
to the management. This is the moment of truth for the researcher - How the study produced the
information needed to prove or disprove the hypothesis and help management make the marketing
decision.
Analysis and interpretation
There is a lot of data available waiting to be turned into information. The researcher starts
by tabulating data, calculating the responses question by question and summarizing. Then the data is
analyzed in a variety of ways using software packages. The analysis helps to understand the relationship
between factors in the research. It also helps to identify patterns and details that provide clues to the
truth of the hypothesis.
When analyzing the results marketers use statistical interpretation which is the use of statistical
methods to learn how some data differ from the study’s averages, how some data are similar to the
study’s averages and the reasons for the deviations. Depending on the problem and the method, there
are numerous techniques to analyze the results. This would be discussed in a separate chapter.
Presentation
The last step in the process is also the one that determines the next step management will
take in making the marketing decision. Hence the findings should be presented in a concise, complete
way that is understandable to the people who must make the decision. Whether made in person or in
written form, the report should explain clearly what the results showed and should draw conclusions
about the meaning and most important the report should tell management the implications of the
research and make specific recommendations to enable the management to arrive at an appropriate
decision.

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Problems Faced by the Researcher During the Research Process
When requesting a research project, a manager may hope that the survey will show results
favourable to the manager’s personal inclinations or intentions. In such situations the manager probably
has a good idea about the intention of the research but may not disclose it expecting a favourable
research findings to support his decision. There is a good chance that the manager will not provide
the researcher a clear statement of the real problem.
The best way to identify specific research objectives is to put them in a written form. The
manager and the researcher can then discuss the written statement modifying it wherever necessary
much of the responsibility for specifying the research objectives necessarily lies with the manager.
Researcher may not be knowing the objectives of the study unless it is made clear to him by the
manager.
The manager is expected to give an idea about the different courses of action he has for
different findings of the research. It may be of very useful information to the researcher in gathering
information. In order to avoid all possible errors during the first phase of research, the researcher
and the manager must work together to identify the decision models and the research objectives.
In deciding the information to be gathered, some managers may think their involvement is
not necessary and expect the researcher to understand the real situation and to identify the information
they need for decision making. There is a good chance that the researcher’s list of needed information
may differ from the manager’s list and this can be a major source of error marketing research. Managers
and researchers should work together to develop the list of needed information and then attempt to
evaluate it’s usefulness.
Researchers encounter many possible sources of error when designing a data collection
project. Some of these include using a poor or inappropriate research design, not selecting the right
type of respondents who have valid and reliable information, asking ambiguous questions etc. The
researcher has to be very careful in deciding the sample, the structure of questionnaire and the type
of research design. The researcher must identity who has the needed information and how it can be
obtained. The researcher must be very careful in deciding whether survey method or observation is
the best method for the project. If survey method is adopted personal interview or telephonic survey
is the apt method for the particular research.
The researcher may encounter problems in selecting a sample type such as not representative
of the population with regard to the topic under study and this may result in lack of reliability. The
first task in sampling is to define carefully just what groups of people, stores or other units are to be
sampled. For example, if the study calls for collecting data from appliance dealers, it is necessary to

23
define what is meant by an appliance dealer. It is also necessary to define the precise geographical
area of interest. Then the researcher must decide on the type of sample which is to be selected.
Errors resulting from sample size are likely to be greater when small rather than large samples
are used. The magnitude of potential error for sample size can be calculated using the theory of sampling
statistics, if a probability sample is used. That theory can help researchers determine what sample
size is needed for a given degree of accuracy. The accuracy needed in the study and the cost of
using various size samples will determine the choice and the reliability of the results.
In studies involving personal interviews in the home, fieldwork is often widely dispersed
geographically and the field workers themselves have varying skills. In such studies, it is difficult
expensive and time consuming to determine whether the interview or observation was actually made
or not. Field workers may not follow the instructions to them and they may interview people who are
not members of the population being studied. By following what are considered good practices in the
selection, training, controlling and evaluating of field workers, marketing researchers can do much to
standardize procedures and to minimize errors resulting from field work.
During editing and coding, if care is not taken, significant errors may be introduced into the
data which may affect both validity and reliability. This can be very easily overcome by taking proper
case during the process.
Finally, even if all the phases of the marketing research process are carried out properly,
the project will not be successful if the findings are poorly reported.
Objectives of Marketing Research
The main objectives of marketing research pertain to make decisions. Decisions are made
with regard to three forms of research.
1. Monitoring research
2. Preliminary research
3. Exploratory research.
Objectives of Monitoring Research
A major task of management is to recognize and diagnose problems. No problem exists
until someone asserts that it does, although the particular situation may have existed for sometime
unrecognized. Problem discovery is the first stage of any decision process and is the main objective
of monitoring research. There is a problem when the decision maker faces uncertainty, which may
concern either difficulties or opportunities. Difficulties are situations or developments that have negative
or counter productive consequences. Some of them are overt which already are causing trouble. To
these, only the manager can react. Or else if a difficulty has not yet caused negative effects, it is latent
and may be tractable. If a manager has a monitoring system that would detect a latent trouble, that

24
manager can be proactive and move to solve the difference before it causes serious trouble.
Opportunities on the other hand are situations with positive potentials that if recognized and capitalized
are profitable to the enterprise. Managers need to be alert and sensitive to problems but also must
be infusing. Most problem recognition is done by managers themselves through their own observations
and various channels of communication – both within the organization and from outside.
The three objectives could be made more clear from the figure below:
Objectives of Preliminary Research
The objectives of preliminary research is to gather data on the situation surrounding the
supposed problem to determine (1) a correct definition of the problem (2) an understanding of its
environment (3) whether the initial feedback data – which triggered problem recognition – accurately
pictured the situation. Only the most significant problems should have priority for formal research.
Only the problems involving the greater risk and unknown are profitable to study. The results of a
preliminary research project should enable the right problem to be identified – whether that deals
with some differences or with some opportunities to exploit.
Discover the
problem
Monitoring
Research
Preliminary
Research
Determine the
nature of the
problem
Determine the
environment
Find and select
logical alternative
action
Define the decision
operationally
Set the objectives for
conclusive research
Exploratory
Research

25
Objectives of Exploratory Study
The next question is whether there is sufficient need or not to conduct an exploratory study.
Such a study’s main purposes would be to determine the appropriate area where the problem lies
and also to identify some attractive courses of action to solve it. It may incidentally also enable a
sharper definition of the problem to be made.
Interaction Between Management And Marketing Research
Although the use of marketing research has been growing steadily, the relationship between
managers and marketing researchers is not always smooth one. Misunderstandings often exist between
managers and marketing researchers – and both parties lack a good understanding of the role and
needs of the other party.
Some of the management’s complaints about researchers are:
1. Research is not problem oriented. It tends to provide certain facts but not actionable results.
2. Researchers are too involved with techniques and they appear to be reluctant to get involved
in management problems.
3. Research is slow, vague and of questionable validity.
4. Researchers cannot communicate, they do not understand and they do not talk the language
of management.
Researchers have their complaints about management:
1. Management does not include research in discussions of basic problems. Management tends
to ask only specific information about parts of problems.
2. Management pays no more than lip service to research and does not really understand or
appreciate its value.
3. Management does not allow enough time for research. They draw preliminary conclusions
based on early or incomplete results.
4. Management relies more on intuition and judgment than on research. Research is used as a
crutch and not as a tool.
Manager and Researcher Responsibility and Involvement
The key issues underlying the difficulties existing between managers and marketing researchers
seem to be the responsibility and involvement of both parties.
There are five occasions when managers should contribute inputs to the marketing research
process or participate in decisions relating to marketing research. They are as follows:

26
1. Initiating research projects
As individual researchers are not likely to have all the information that are available to
managers, they cannot be expected to know all the problems managers face. One of the manager’s
responsibilities is to initiate marketing research when it is needed and to do so at the earliest possible
opportunity.
When initiating the marketing research the manager should prepare a written document of
the problem or situation and the alternative courses of action being considered. Such a statement can
then serve as the basis for discussions. Usually managers expect more than what a research can
deliver. The second problem is that the marketing researchers frequently interpret or modify a
management problem in order to make it researchable. That is the managers are more concerned
with the management problems whereas the researchers are more bent towards the research problems.
2. Specifying information needed for decision making
In their written problem statement the managers should include detailed descriptions of
information they need to make a decision on each of the alternative being considered. These detailed
descriptions of needed information can form a basis for further discussion between managers and
researchers, where the latter can ask questions that will lead to more complete picture of information
required by the managers. The final version of the research project will be of much more use to the
managers in that case.
3. Evaluating proposed research projects
Typically research studies are authorized only after a study proposal has been approved by
management. In order to avoid misunderstandings or poor communications the manager should require
a written proposal and clearly evaluate it prior to approving.
4. Evaluating commercial research services
Today a firm can purchase a wide variety of information from commercial research services
– that is from independent companies whose main business activities consist of compiling marketing
information. Although the marketing researcher will take the major responsibility in evaluating which
service is to be purchased, the marketing manager should also involve. For this, the manager should
at first specify the information needed and the purpose of obtaining such information.
5. Accepting or rejecting research findings
Decision making is the responsibility of the manager and not that of the researcher. It is the
manager’s responsibility to avoid a decision based on invalid research findings. An enquiry should be
made on the validity of the research findings before any decision is taken.
When Not To Do Research
Agreatmanyresearchprojectsareconcernedwithgatheringinformationoncurrentandrecentconsumer
attitudesandbehaviors.Thistypeofresearchiscommonlyusedbecauseconsumershavesuchinformation
which they are likely to remember and more often they are willing to give it to the researchers.

27
There are certain situations where it may be difficult or impossible to do certain type of
research or to obtain accurate and reliable information through research. Both the managers and
researchers should be aware that such conditions exist.
1. Often respondents will be unable to give valid answers to questions concerning something
that happened in their distant past or that might happen in the far off future. For example – in a test of
two advertising copy treatments, the consumers can indicate which they recall or which they find more
appealing, but they are unable to describe the long run effect each will have on their attitudes and
behaviors.
2. Unimportant events in a person’s past are less likely to be remembered. People may always
remember their first car, but they may not remember all the brands of soaps they have purchased
during the last four months.
3. Respondents may have difficulty in communicating their emotions and sensations to researchers.
For example- consumers may be able to identify which of the two coffees tastes better. But they will
be unable to communicate to the interviewer the sensations they experienced in arriving at their choice.
4. While researchers can obtain consumers attitude and opinions about most new product
concepts and descriptions, certain types of prospective new products or services may not be
researchable or may be only partially researchable. For example – If a company wants to run a limited
test market to its travel credit card which could be used anywhere in the world, the test marketing
should involve the card holders to use the card in different parts of the world which may not be
always practical.
5. Because of the nature of some products there may not be enough time available to do research.
For example – as a result of their very short lifecycle very little research is undertaken in women’s
dresses. In some other cases a competitor’s actions may have to be responded immediately, hence
there would be no time for research.
6. If the advantages associated with a company’s new product could easily be copied by
competitors once they have become aware of the new product, it is not practical for the company to
undertake any kind of marketing research that may expose their new product to competitors. In such
cases companies try to gain national distribution as soon as possible and try to enjoy the advantages
associated with being the first to market such a product.
Research Proposal
A research proposal provides a firm’s management or others who want to initiate a project
with information about the approach. Thus a research proposal can be defined as a blue print or
guide which explains how a researcher plans to control and conduct can investigation. Every research
project must be preceded by a proposal. A well developed proposal not only will serve the searcher
as a guide line for controlling and conducting the study but also will act as an effective means of
communication between the researcher and management or others by providing logical reasoning for
conducting the project.

28
A good proposal must provide information about the research methodology (1) Source and
methods of obtaining needed data (2) Sampling plans and (3) Analytical procedure. Analytical
procedure involves specification of the statistical or mathematical model. The proposal also should
provide information about administrative control of the project, costs associated with various phases
of the project, and the time schedule.
The size of the proposal with regard to details provided depends upon the research
procedures, to whom the researcher is submitting the proposal and how much money will be involved
in the successful completion of the proposed study. A brief proposal may contain an outline of (i) the
problem statement and objectives (ii) the methodology and (iii) the benefits the firm could reap from
the research.
Preparing an effective and efficient proposal is a matter of experience and the proposal
provides the researcher with an opportunity to sell his product. While preparing the proposal, the
researcher must remember that the decision of whether or not to fund a project which is usually made
solely on the basis of this document.
COMPONENTS OF A RESEARCH PROPOSAL
A research proposal must meet two basic requirements. It should:
(i) Communicate effectively and convince management or the sponsoring agency that the study
is relevant to the problem and
(ii) Indicate that the various phases of the project employ economic and efficient procedures for
the successful completion of the study.
Typically, a well written proposal can be divided into eleven different broad sections. Based
on the order in which they are put together, these components are (1) topic or title of the project
(2) abstract (3) introduction (4) Problem statement and objectives (5) review of related literature
(6) research procedure or methodology (7) dissemination and use of the findings (8) time schedule
(9) budget (10) bibliography and (11) appendices.
1. Topic or title
The title of the project helps to identify the project the researcher is investigating. This is
important to any organization conducting several research projects simultaneously. The title given to
the project should be related to the major problems or objectives of the study.
In selecting the title for a proposal, the researcher should read carefully the guidelines of the
agency soliciting the proposal. A brief clear and catchy title may itself be the ‘selling’ feature of a
research proposal.
2. Abstract
It is a brief summary of the project, usually one or two paragraphs long. It should never
exceedtwopages. Theabstractusuallyincludesanoutlineoftheobjectivesofthestudyanddescribes

29
the research method that will be used in analyzing the data. Though an abstract usually appears at the
beginning of the proposal, the abstract is written after the proposal has been completely developed.
The abstract should present the high-lights of the proposal because the abstract serves several
purposes like:
1. In the case of the research proposal submitted to the government or any other agency, the
field reader or panel member who first evaluates the proposal reads the abstract to get an
overall view of the proposed study.
2. Whenever the proposal is discussed during the evaluation process, the field reader normally
recall best what he read in the abstract.
3. Sometimes the panel member reads only the abstract and makes recommendations based on
that. Because abstract plays such an important role, it should:
(i) be prepared with extreme care,
(ii) emphasize the objectives of the study and the research procedure to be used and
(iii) include the key words or terms of the research proposal to facilitate the reader’s
recalloftheterms.
3. Introduction
The introduction describes in detail the problem faced by the firm and the factors that influence
it at a given point of time. This is important because the individual who approves the proposal, the
decision maker who initiates or sponsors the research project, and the individual interested in getting
the project approved will not be the same person. Therefore, the introduction provides information
to the individuals connected in any way with a research proposal and project and ensures that the
researcher and decision – maker agree on the nature of the basic problem. A well written introduction
puts the problem faced by the firm into proper perspective.
4. Problem statement and objectives
The component containing the problem statement and objectives follows the introductory
section of the proposal and states the problem and objectives of the study in precise terms. If a
hypothesis is to be tested it is stated in a form that the reader can easily understand. The manner in
which the problem or objective or the hypothesis is stated will guide the steps involved in the study
and affect the recommended solutions the decision maker may implement. Because of the effect of
the problem statement and objectives on the end product and management’s decision making, the
researcher should give extra consideration to this component and should identify the problem and
define it precisely. He also should assist in the decision making process, by communicating effectively
with the decision maker.
This discussion indicates that identifying the problem and formulating it in precise terms is
the joint responsibility of the researcher and management.

30
Although this section appears to be simple, the researcher-should think carefully before writing
the section. He needs to draw inferences from past experience, talks with others who are aware of
what is happening in the firm and examine the firm’s in house records. Whether the proposal contains
a problem statement and objectives or a hypothesis that needs to be tested, it is necessary to list
them in a specific order. Such a listing will help management or the research proposal reviewer to
understand clearly what the investigator is seeking.
5. Review of related literature
The segment of the proposal most often described as ‘Literature Survey’ or ‘Review of
previous studies’ provides an excellent opportunity for the researcher to indicate his scholarly
competence. The major purpose of reviewing literature is to find alternative courses of action to
solve the firm’s problem and thereby to reach the final goal of the proposed study.
A good review of literature provides the investigator with a substantial amount of information
about the environment in which he has to help the management to make important decisions. The
need for and the amount of information that should be acquired through the review of literature are
dependent upon three factor - (i) the nature of the problems (ii) the magnitude of the problems
and (iii) the amount of knowledge the researcher has at the given point of time about the environment
in which the problem exists.
In writing the literature review part of the research proposal, the researcher should follow
the following steps:
1. Select only those studies that provide information on the proposed project.
2. If no study concerned to the proposed project is available, select those studies that come
close to the project and indicate how they fall short.
3. Choose the literature most recent in content and method.
4. Discuss the selected studies in sufficient detail so that a non-specialist can understand their
relevance.
5. Briefly explain the manner in which the selected studies contribute to the proposed project
and how the proposed project goes beyond the previous studies.
6. If some studies related to the proposed project are currently in progress, cite such studies.
A good review of literature will help the researcher to take a better look at the existing
problem and ascertain an appropriate research method. In addition a good literature review will help
management or those evaluating the proposal to judge the ability of the researcher to complete the
study successfully.
6. Research procedure
It is also known as ‘Research Methodology’ and ‘Research Approach’. Research procedure
provides a detailed description of the procedure to be used. The description should provide adequate

31
information about each aspect of the methodology. A step-by-step approach in describing the
research procedure helps the reviewer to decide whether or not the researcher will complete the
investigation successfully. The individual who prepares the proposal should provide information on (i)
characteristics or attributes of the population to be obtained (ii) whether any indirect methods such
as scaling techniques will be used to measure behavioral data in quantitative terms and (iii) the research
design and model that will be used for analyzing data.
As long as the section on the research procedure is satisfactory from the point of view of
management and those who review the proposal for the purpose of funding, the researcher can be
certain that the project will be funded.
7. Dissemination and use of findings
The major interest of management and many of the agencies that solicit research proposals
is the dissemination and use of findings. The researcher should therefore state precisely how the findings
of the study will be disseminated to those who are concerned with the findings and how they can be
put into practical use.
8. Time Schedule
In addition to providing information about effective and efficient research procedure, a good
proposal should also provide a time table. The time schedule is helpful to management or others who
want to initiate research in evaluating the feasibility and timeliness of the proposed project. The time
schedules also reveal to the management how realistic the researcher is. The time schedule is more
important in studies related to marketing activities because marketing research is normally an operation
in which time is an important constraint.
In establishing the time schedule for projects that have a rigid completion date, it is better to
schedule backward from the deadline date. When a schedule is being established, the time required
for the following activities should be borne in mind (i) data collection (ii) processing of data so that it
can be analyzed using computer facilities (iii) analysis of data (iv) preparing the research report
and (v) producing an adequate number of copies of the research report.
When the time schedule is being prepared the following factors should be considered:
(i) whether the starting date and time allocated for various phases are consistent with for the
personnel available to the investigator (ii) whether the time allocated for data collection is adequate,
even if the field staff has unforeseen problem (iii) whether the time set aside for analyzing the data is
adequate in the light of available personnel, equipment and facilities and (iv) whether the researcher
will be able to prepare the final report on time and provide the required number of copies.

32
9. Budget
Firms, federal agencies and other institutions that sponsor research should know how much
a particular project will cost from inception to completion. The information pertaining to the cost of
the project is called budget and budget can be defined as “a quantitative expression of a plan of
action and an aid to co-ordination and implementation”. To provide information about costs, every
proposal submitted must contain a section in which costs which will be incurred for various phases of
research are described. Budget also serves as a basis for evaluating the feasibility of the project in
relation to the resources available and the importance of study in achieving the firms’ objectives.
The total costs are normally divided into direct and indirect costs. The total estimated costs
are obtained by summing the direct and indirect costs. Unexpected events often affect estimated costs.
Therefore provision to meet contingencies should be made when costs are estimated.
In addition to provide information about the costs for successful completion of the project,
budget serves other useful functions. They are (1) determines the means by which the sponsor controls
the project (2) demand careful, well-conceived planning (3) assists in co-ordinating various phases
of research and other activities of the firm (4) provides an opportunity for communication among the
firm’s executives and the researcher and (5) helps to establish criteria with which to measure the
performance of the researcher and the project. A proposal which clearly describes various phases
of research and has a realistic time schedule can be translated easily into a meaningful budget. A
budget statement which has been developed carefully is a good indication of a project which can be
implemented easily.
10. Bibliography
Bibliography which is an essential part of the proposal provides information to the management or to
the proposal reviewers of research who conducts the investigation prior to submitting the proposal. It
also reflects the researcher’s knowledge about a given problem or topic. Alist of all of the books,
journals or other material used as a reference in the proposal should be listed in this segment of the
proposal.
11. Appendices
A proposal may contain technical details in this procedure segment. These technical details can be
presentedinanappendixsothatthosewhowanttoreadthedetailsmaydoso. Theappendixmayalso
includeinformationaboutpersonnelandfacilitiesneeded,thanavailabilityandevidenceofpriorapproval
by other organizations that need to cooperate with the researcher for successful completion of the
project. Also listed in the appendix should be special facilities that are needed and available such as
equipment,alibrary,oralaboratoryforstudyingconsumerbehaviourinbehaviourorientedmarketing
studies.

33
Evaluation of the Research Proposal
Preparing a good proposal is a means for getting the approval of the project sponsor. A
proposal is evaluated by the top executive who has the authority to finalize the project or by a
committee composed of the firm’s executives. The budget needed for successful completion of the
project may influence the review and approval time.
The procedure followed in evaluating a research proposal are as follows:
1. Relevance to the solution of important problems concerning the study.
2. Merit of the proposed projects.
3. Qualifications of the investigators to conduct the proposed project.
4. Approach to solving the problem which consists of (i) Technical approach and (ii) Management
approach.
5. Resources available to the team which include.
(i) Manpower support.
(ii) Facilities,equipment,datasupport
(iii) Academiccommitmenttotheparticularproblem.
6. Overall comments on the proposal.
RESEARCH DESIGN
Meaning
Decisions regarding what, where, when, how much, by what means concerning an enquiry
or a research study constitute a research design. A research design is the arrangement of conditions
for collection and analysis of data in a manner that aims to combine relevance to the research purpose
with economy in procedure. The research design is the conceptual structure within which research is
conducted; it constitutes the blueprint for the collection, measurement and analysis of data. As such
the design includes an outline of what the researcher will do from writing the hypothesis and its
operational implications to the final analysis of data. More explicitly, the design decisions happen to
be in respect of :
(i) What is the study about? (ii) Why is the study being made? (iii) Where will the study be carried
out? (iv) What is the type of data required? (v) Where can the required data be found? (vi) What
periods of time will the study include? (vii) What will be the sample design? (viii) What will be the
techniques for data collection? (ix) How will the data be analyzed? (x) In what style will the report
be prepared?
The overall research design may be split into the following parts:
(a) The sampling design which deals with the method of selecting items to be observed for the
given study.

34
(b) The observational design which relates to the conditions under which the observations are to
be made.
(c) The statistical design which concerns with the question of how many items are to be observed
and how the information and data gathered are to be analyzed and
(d) The operational design which deals with the techniques, by which the procedures specified in
the sampling, statistical and observational designs, can be carried out.
The important features of a research design are:
(i) It is a plan that specifies the sources and types of information relevant to the research problem.
(ii) It is a strategy specifying which approach will be used for gathering and analyzing the data.
(iii) It also includes the time and cost budgets since most studies are done under these two
constraints.
Therefore, a research design must at least contain:
(a) A clear statement of the research problem.
(b) Procedures and techniques to be used for gathering information.
(c) The population to be studied and
(d) Methods to be used in processing and analyzing data.
Need for Research Design
Research design is needed because:
(i) It facilitates the smooth sailing of the various research operations, thereby making research
as efficient as possible yielding maximum information with minimum expenditure of effort, time
and money.
(ii) Research design stands for advance planning of the methods to be adopted for collecting the
relevant data and the techniques to be used in their analysis, keeping in view the objective of
the research and availability of resource.
(iii) Research design has a great bearing on the reliability of the results arrived at and as such
constitutes the firm foundation of the entire edifice of the research work.
(iv) The design helps the researcher to organize his ideas in a form whereby it will be possible for
him to look for flaws and inadequacies.
Features of a Good Design
A good research is often characterized by adjectives like
(a) Flexible (b) Appropriate (c) Efficient (d) Economical etc. The following are the other
characteristics, which are seen in a good design:

35
(1) The design, which minimizes bias and maximizes the reliability of the data collected and
analyzed.
(2) The design, which gives the smallest experimental error, is supposed to be the best design.
(3) A design, which yields maximal information and provides an opportunity for considering many
different aspects of a problem, is considered most appropriate and efficient design.
A research design appropriate for a particular research problem, usually involves the
consideration of the following factors:
(i) the means of obtaining information
(ii) the availability and skills of the researcher and his staff, if any
(iii) the objective of the problem to be studied
(iv) the nature of the problem to be studied and
(v) the availability of time and money for the research work
IMPORTANT CONCEPTS RELATING TO RESEARCH DESIGN
Dependent and independent variables
A concept which can take on different quantitative values is called a variable. As such the
concepts like weight, height, income are all variables. If one variable depends upon or is a consequence
of the other variable, it is termed as a dependent variable, and the variable that is antecedent to the
dependent variable is termed as an independent variable.
Extraneous variable
Independent variables that are not related to the purpose of study, but may affect the
dependent variable are termed as extraneous variables. Suppose the researcher wants to test the
hypothesis that there is a relationship between children’s gains in a particular subject and their self-
concepts in this case, self–concept is an independent variable and the achievement in the subject is a
dependent variable. Intelligence may as well affect the achievement, but since it is most related to the
purpose for which the study has been undertaken by the researcher, it will be termed as an extraneous
variable.
Control
One important characteristic of a good research design is to minimize the influence or effect
of extraneous variable. The technical term ‘control’ is used when the study is designed minimizing the
effects of extraneous independent variable.
Confounded relationship
When the dependent variable is not free from the influence of extraneous variable, the
relationship between the dependent and independent variables is said to be confounded by an
extraneous variables.

36
Research hypothesis
When a prediction or a hypothesized relationship is to be tested by scientific methods, it is
termed as a research hypothesis. Usually a research hypothesis must contain at least one independent
and one dependent variable.
Experimental and control group
In an experimental hypothesis testing research when a group is exposed to usual conditions,
it is termed as control group, but when the group is exposed to some novel or special condition it is
termed as an experimental group.
Treatments
The different conditions under which experimental and control groups are put are usually
referred to as treatments.
Experiment
The process of examining the truth of a statistical hypothesis, relating to some research
problem, is known as an experiment.
Experiment units or test units
The pre–determined plots or the blocks where different treatments are used are known as
experimental units. Such test units should be selected very carefully.
Types of Research Designs
Research designs are categorized as
(i) Research design in case of exploratory research studies
(ii) Research design in case of descriptive and diagnostic research studies.
(iii) Research studies in case of experimental studies.
Exploratory Research Studies
Exploratory research studies are also termed as formulative research studies. The main
purpose of such studies is that of formulating a problem for more precise investigation or of developing
the working hypothesis from an operational point of view. The major emphasis in such studies is on
the discovery of ideas and insights. The research design appropriate for such studies must be flexible
enough to provide opportunity for considering different aspects of a problem under study. Inbuilt
flexibility in research design is needed because the research problem, broadly defined initially is
transformed into one with more precise meaning in exploratory studies, which in reality may necessitate
changes in the research procedure for gathering relevant data. Generally, the following three methods
in the content of research design for such studies are talked about: (a) the survey of concerning literature
(b) the experience survey and (c) the analysis of insight stimulating examples.

37
Marketing Problem
Possible redefinition
of problem situation
Exploratory research
No
Have sufficient in
sight and knowledge
regarding problem
situation and
variables
Yes 1
Do we require more
information before
making decision
1 Yes
Conduct descriptive
or experimental
No
Market decision
(a) The survey of concerning literature happens to be the most simple and fruitful method of
formulating precisely the research problem or developing hypothesis. Hypothesis stated by
earlier workers may be reviewed and their usefulness be evaluated as a basis for further
research. It may also be considered whether the already stated hypothesis suggest new
hypothesis. In this way the researcher should review and build upon the work already done
by others, but in cases where hypothesis have not yet been formulated, his task is to review
the available material for deriving the relevant hypothesis from it.
Besides, the bibliographical survey of studies, already made in one’s area of interest, may as
well be made by the researcher for precisely formulating the problem. He should also make
an attempt to apply concepts and theories developed in different research contents to the
area in which he himself is working. Sometimes, works of creative writers also provide fertile
ground for hypothesis formulation.
(b) Experience survey means the survey of people who have had practical experience with the
problem to be studied. The object of such a survey is to obtain insight into the relationships

38
between variables and new ideas relating to the research problem. For such a survey, people
who are competent and can contribute new ideas may be carefully selected as respondents
to ensure different types of experience. Thus, an experience survey may enable the researcher
to define the problem more concisely and help in the formulation of the research hypothesis.
This survey may as well provide information about the practical possibilities for doing different
types of research.
(c) Analysis of insight stimulating examples is also a fruitful method for suggesting hypothesis for
research. It is particularly suitable in areas where there is little experience to serve as a guide.
This method consists of the intensive study of selected instances of the phenomenon in which
one is interested. For this purpose, the existing records, if any, may be examined, the
unstructured interviewing may take place or some other approach may be adopted.
Thus, an exploratory or formulative study merely leads to insights or hypothesis, whatever
may be the method of research design outlined above is adopted. The only thing essential is that it
must continue to remain flexible so that many different facts of a problem may be considered as and
when they arise and come to the notice of the researcher.
DESCRIPTIVE STUDIES
Descriptive studies are undertaken in many circumstances. When the researcher is interested
in knowing the characteristics of certain groups such as age, sex, educational level, occupation or
income a descriptive study may be necessary. Other occasions when a descriptive study could be
taken up are when the researcher is interested in knowing the profession of people in a given population
who have behaved in a particular manner making projections of a certain thing or determining the
relationship between two or more variables. The objective of such a study is to answer the ‘who,
what, when, where and how’ of the subject under investigation.
Descriptive studies are well structured. It tends to be rigid and its approach cannot be changed
every now and then. It is therefore necessary that the researcher gives sufficient thought to frame
research questions and deciding the types of data to be collected and the procedure to be used for
this purpose. Descriptive studies can be divided into two broad categories: cross- sectional and
longitudinal.
1. Cross-sectional studies
A cross sectional study is concerned with a sample of elements from a given population.
Thus, it may deal with households, dealers, retail store or other entities. Data on a number of
characteristics from the sample elements are collected and analysed. Cross- sectional studies are of
two types– field studies and surveys.

39
Field studies aim at finding the relations and inter-relations among variables in a real setting.
Such studies are done in life situations like communities, schools, factories, organizations and institutions.
Field studies have theirown strength and weaknesses. One major strength is that they are close to
real life, and they cannot be criticized on the ground that they are remote from real settings or are
artificial. Field studies are more socially significant than any other type of studies. They are also strong
in their heuristic quality.
But field studies are inferiors to laboratory and field experiments. Interrelations among variables
are weaker than they are in laboratory experiments. Such studies have practical problems with respect
to flexibilities, cost, sampling and time.
Another type of cross sectional study is surveys. Detailed information can be obtained from
a sample of a large population. Besides, it is economical as more information can be collected per
unit of cost. But the survey research does not penetrate below the surface as more emphasis is given
to the extent of information sought rather than to an in-depth analysis. Survey research too demands
more time and more money when conducted on a large scale. Another limitation is that the interview
may make the respondent alert and cautious and he may not answer the questions in a natural manner.
2. Longitudinal studies
These studies are based on panel data and panel methods. A panel is a sample of respondents
who are interviewed and re-interviewed from time to time. Generally, panel data relate to the repeated
measurement of the same variables. Each family included in the panel records its purchases of a number
of products at regular intervals, say, weekly, monthly or quarterly. Over a period of time, such data
will reflect changes in the buying behaviour of families.
Advantages
(1) Such data enable the researcher to undertake detailed analysis.
(2) More comprehensive data could be obtained as individuals or families, included in the panel
are those who have accepted to provide data periodically.
(3) The panel data have been found to be more accurate than data collected through surveys.
(4) Costs of data collection through panels are generally lower than through personal interviews.
Limitations
(1) The panels may not be representative samples.
(2) Panel members may report wrong data.
(3) When the initial interest in the membership has faded, members may lose interest in this and
may not fully co–operate with the research organization.

40
EXPERIMENTAL DESIGNS
Experimental studies are those where the researcher tests the hypothesis of causal relationship
between variables. Such studies require procedures that will not only reduce bias and increase reliability,
but will permit drawing inferences about causality. Professor R.A. Fisher’s name is associated with
experimental designs. Professor Fisher has enumerated three principles of experimental designs.
(1) The principle of replication
(2) The principle of randomizing and
(3) The principle of local control.
According to the principle of replication, the experiment should be repeated more than once.
Thus, each treatment is adopted in many experimental units instead of one. By doing so, the statistical
accuracy of the experiment is increased. Conceptually, replication does not present any difficulty, but
computationally it does. But replication is introduced in order to increase the precision of a study to
increase the accuracy with which the main effects and interactions can be estimated.
The principle of randomization provides protection when an experiment is conducted, against
the effects of extraneous factors by randomization. In other words, the experiment should be designed
or planned in such a way that the variations caused by extraneous factors can all be combined under
the general heading of ‘chance’. Through the process of randomization, the research has a better
estimate of the experimental error.
The principle of local control is another important principle of experimental designs. Under
it, the extraneous factor, the known sense of variability, is made to vary deliberately over as wide a
range as necessary and this needs to be done in such a way that the variability it causes can be
measured and hence eliminated from the experimental error.
Important Experimental Designs
Experimental designs refer to the framework or structure of an experiment and as such there
are several experimental designs. Experimental designs could be classified into two broad categories–
informal experimental designs and formal experimental designs. Informal experimental designs are those
designs that normally use a less sophisticated form of analysis based on difference in magnitude where
as formal experimental designs offer relatively more control and use precise statistical procedures for
work analysis. Important experimental designs are:
(a) Informal experimental designs
(i) Before and after without control design
(ii) After only with control design
(iii) Before and after with control design
(b) Formal experimental designs

41
(i) Completely randomized design (C R design)
(ii) Randomized block design (R B design)
(iii) Latin square design (L S design)
(iv) Factorial designs
a. (i) Before and after without control design
In such a design, a single test group is selected and the dependent variable is measured
before the introduction of the treatment. The treatment is then introduced and the dependent variable
is measured again after the treatment has been introduced. The effect of the treatment would be equal
to the level of the phenomenon after the treatment minus the level of the phenomenon before the
treatment. The design can be represented as:
TextArea: Level of phenomenon Treatment introduced Level of phenomenon after
before treatment(x) treatment(y)
Treatment effect = (y) – (x)
For example, the sales made by salesmen at period 1 are noted. Then, training is provided
to him for a certain period and then again measure the sales made by him. A comparison of sales
made after training with sales made during the corresponding period before training is done. Thus,
the effectiveness of the training can be measured.
(ii) After only with control design
In this design, two groups are selected and the treatment is introduced to the test group
only. Then, the dependent variable is measured in both the areas at the same time. Treatment impact
is assessed by subtracting the value of the dependent variable in the control area from its value in the
test area. This could be exhibited as below:
TestGroup: Treatmentintroduced Levelofphenomenonafter
treatment(y)
Treatment effect = (y) – (z)
The basic assumption in such a design is that the two groups are identical with respect to
their behaviour towards the phenomenon considered. If the assumption is not true, there are the
possibilities of extraneous variation entering into the treatment effect. However, data can be collected
in such a design without the introduction of problems with the passage of time.
(iii) Before and after with control design
In this design, two groups are selected and the dependent variable is measured in both the
areas and groups for an identical time period before the treatment. The treatment is then introduced
into the test group only and the dependent variable is measured in both for an identical time period
Control Group: Level of phenomenon
without treatment (z)

42
after the introduction of the treatment. The treatment effect is determined by subtracting the change in
the dependent variable in the control group from the change in the dependent variable in the test group.
This design could be represented as:
Timeperiod1 Timeperiod2
Testgroup: Levelofphenomenon Treatmentintroduced Levelofphenomenonafter
beforetreatment(x) treatment(y)
Controlgroup: Levelofphenomenon Levelofphenomenon
withouttreatment(A) withoutTreatment(Z)
Treatment effect = (y–x) – (z–A)
This design is superior to the above two designs for the simple reason that it avoids extraneous
variation resulting both from the passage of time and from non– comparability of the test and control
groups.
b (i) Completely Randomized design (C R Design)
Involves two principles– principle of replication and principle of randomization. It is the
simplest possible design and the procedure of analysis is also easier. The essential characteristic of
this design is that subjects are randomly assigned to experimental treatments. One way Analysis Of
Variance (ANOVA) is used to analyse such a design. Even unequal replications can work in this
design. It provides maximum number of degrees of freedom to the error.
Two group simple randomized design
In this design, first of al, the population is defined and then from the population a sample is
selected randomly. Further requirement of this design is that items after being selected randomly from
the population, be randomly assigned to the experimental and control groups. Such random assignment
to two groups is technically described as principle of randomization. Thus this design yields two groups
as representatives of the population. This could be represented as shown below:-
Since in simple randomized design the elements constituting the sample are randomly drawn
from the same population and randomly assigned to the experimental and control groups, it becomes
possible to draw conclusions on the basis of samples applicable for the population. The two groups
of such a design are given different treatments of the independent variable. The merit of such a design
is that it is simple and randomizes the differences among the sample items. But the limitation is that
the individual differences among those conducting the treatments are not eliminated. For example,
two groups of salespeople are selected randomly and randomly assigned. Two different treatments
viz, usual training and specialized training are being given to the two groups. The researcher hypothesizes
greater gains for the group receiving specialized training. To determine this, he tests each group before
and after the training and then compares the amount of gain for the two groups to accept or reject
this hypothesis. But, here the individual differences between the salesmen are not taken into account.

43
Population
Randomly
selected
Randomly
assigned
Independent
variables
Experimental
Group
Sample
Control
Group Treatment B
Treatment A
Random replications design
The limitation of the two group randomized design is usually eliminated with the random
replications design. The extraneous variable is controlled by repetitions for each treatment. Each
repetition is typically called a replication. Random replication design serves two purposes – it provides
controls for the extraneous variables and it randomizes any individual differences among those
conducting the treatment.
It could be represented as below:
The difference between the two groups simple randomized design and random replication
design is that in the first case, the experimental and control groups were from the same population.
From the figure, it is clear that there are two populations in the replication design. The sample
is taken randomly from the population available for study and is randomly assigned to four control
groups. Similarly, sample is selected from the population available to conduct experiments. Generally,
equal number of items are put in each group so that the size of the group is not likely to affect the
results of the study.

44
Population
(Available for
Study)
Random Selection
Sample
(to be studied)
Population
(Available to
conduct treatments)
Sample
(To conduct
treatments)
Random
Assignment
Group 1
Group 2
Group 3
Group 4
Group 5
Group 6
Group 7
Group 8
E
E
E
E
C
C
C
C
Random
Assignment
Treatment B
Independent variable or
causal variable
Random Selection
Treatment A
(ii) Randomized Block Design (RB design)
It is an improvement over the C R design. In the RB design, the principles of local control
can be applied along with the other two principles of experimental designs. In the RB design, subjects
are first divided into groups , known as blocks such that within each group, the subjects are
homogenous in respect of some selected variable. The variable selected for grouping the subject is
one that is believed to be related to the measures to be obtained in respect of the dependent variable.

45
The number of subjects in a given block should be equal to the number of treatments and one subject
in each block would be randomly assigned to each treatment. In other words, blocks are the levels
at which the extraneous factor remain fixed, so that its contribution to the total variability of data can
be measured. The main feature of RB design is that in this each treatment appears the same number
of times in each block. The R B design is analyzed by the two way analysis of variance (two ways
ANOVA).
Latin squares design
Suppose a researcher wishes to evaluate the effects of three alternative shelf arrangements
(A, B and C). He plans to do this by observing the sales generated by each variation in each of the
three stores in each of the three time periods. He designs an experiment in which each of the shelf
arrangement is used once and only once in each store and once but only once in each time period.
The following arrangement would meet these specifications:
Timeperiod Store
1 2 3
1 A C B
2 C B A
3 B A C
Such a geometric pattern in which each letter is represented once and only once in each
row and column of a square is called as a Latin Square. The Latin square above is said to be of size
3 x 3 referring to the number of rows and columns in the square. Latin square designs are used when
there are two major extraneous factors.
(iv) Factorial designs
Factorial designs are used in experiments where the effects of varying more than one factor
are to be determined. There are two types of factorial designs – simple factorial designs and complex
factorial designs.
Simple factorial designs – in the case of simple factorial designs, the effects of varying
two factors on the dependent variable are considered, but when an experiment is done with more
than two factors, complex factorial designs are used. Simple factorial designs are also called as two-
factor factorial designs, whereas complex factorial design is known as multi-factor factorial designs.
For example, several different advertisements could be tested, each with a separate experimental group.
All but one group could be considered as control group against which to compare the experimental
group, or an additional group not exposed to any advertising could be used to protect against negative
effects of all advertisements.

46
Types of errors affecting experimental results
When experiments are conducted, the results obtained are subjected to certain errors. Ten
types of potential errors can be identified. They are:
(1) Pre-measurement error (2) Interaction error (3) Maturation (4) History (5)
Instrumentation (6) Selection (7) Mortality (8) Reactive error (9)
Measurement timing (10) Surrogate situation.
(1) Pre-measurement error
This type of error could be made clear by means of an example. Suppose, an interviewer
approaches a person with a questionnaire on a soft drink. The person may not have consumed the
particular soft drink and he answers the questionnaire. Then, after some days he tries the soft drink.
If he is approached again with an alternative form of the questionnaire, the response would reflect
both increased consumption and a more favorable attitude towards the brand.
Thus pre-measurement effects occur any time, the taking of a measurement has a direct effect
on performance in a subsequent measurement. Pre-measurement is a major concern if the respondents
realize that they are being measured.
(2) Interaction error
Interaction error occurs when a pre-measure changes the respondents’ sensitivity or
responsiveness to the independent variable(s), This effect is mostly seen in studies involving attitudes,
brand awareness and opinions. For eg: - A group of individuals may be given a questionnaire containing
several attitude scales concerned with a product brand. These individuals are then likely to be
particularly interested in the advertisements concerning the product brand. Hence, when an increase,
decrease or change in advertisements may be noticed by this group of individuals and the reaction
may be seen in a second questionnaire being supplied. But this reaction will not be seen in the case
of individuals who did not receive the initial questionnaire.
The difference between premeasurement error and interaction error is that in the first case
the individual was not at all exposed to the product brand. But in the second case the respondent
had interaction with something related to the product.
(3) Maturation
Maturation represents biological or psychological processes that systematically vary with the
passage of time, independent of specific external events. Respondents may grow older, more tired
or thirstier between the pre-and post-measurements. Maturation occurs as a major problem in those
experiments that persist over months or years, such as market tests and experiments dealing with the
physiological response to such products as toothpaste, cosmetics and medication.
(4) History
History does not refer to the occurrence of events prior to the experiment. History refers to
any variable or event other than the one(s) manipulated by the experimenter, that occurs between the

47
pre and post-measures and affect the value of the dependent variable. For eg: A soft drink bottler
may measure its level of sales in a region, launch a promotional campaign for two weeks and monitor
sales level during and immediately after the campaign. Such factor like unusual heavy advertising by
a competitor or unreasonably warm or cold weather could each produce a change in sales. These
extraneous variables are referred to as ‘history’.
(5) Instrumentation
Instrumentation refers to changes in the measuring instrument over time. These changes are
most likely to occur when the measurement involves human as either observers or interviewers. The
interviewers and respondents may sometimes show great skill before the measurement and lessen
interest in the post measurement phase. The vice-versa can also happen.
(6) Selection
Selection error occurs mostly in the selection of groups. The groups may vary with respect
to the propensity to respond to the independent variable. For eg: - to carry out an experiment, three
groups are required at three scheduled time periods of a particular day. If the respondents are asked
to volunteer, it is likely that people are willing to volunteer for a morning session differ in a number of
respects from those who come at a different time.
(7) Mortality
Mortality refers to the differential loss (refusal or inability to continue in the experiment) of
respondents from the various groups. Mortality error occurs in a single group if the respondents
differ in opinion from those who have withdrawn from the group.
(8) Reactive error
A reactive error occurs when the artificiality of the experimental situation or the behaviour
of the experimenter courses effects that emphasize, dampen or alter any effect caused by the treatment
variable. This is because human subjects do not respond passively to experimental situations. They
try to discover the experimental hypothesis and then produce the anticipated behaviour.
(9) Measurement Timing
Errors of measurement timing occur when pre- or post-measurements are made at an
inappropriate time to indicate the effect of the experimental treatment. The immediate impact of the
independent variable may be different from its long range effect.
(10) Surrogate situation
Surrogate situation errors occur when the environment, the population(s) sampled, and /or
the treatment administered are different from those that will be encountered in the actual situation.

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