4 Major Roles of Marketing Research
A market researcher, like a doctor, can describe the situation of ill-health and prescribe the remedies. Marketing research is of particular importance to manufacturers, distributors, advertising agencies and the government.
Each stands to benefits to the extent one depends on this managerial tool because, it has the power of problem solving and decision-making.
Its role can be analyzed from the angles of above referred participants as under:
I. Manufacturers and Marketing Research:
Every agile manufacturer is expected to design the most matching policies and marketing strategies. A policy is the guiding principle established by the firm to govern the actions usually under repetitive conditions.
Strategy, on the other hand, is a kind of plan formulated basically to meet the challenges of special circumstances. It is a counter plan to kill the plans of competitors.
Manufacturers stand to benefit in two ways by marketing research:
1. Framing and Implementing Product Policies:
Marketing research solves effectively the problems in the areas or activities of product policy formulation and implementation. These product policies are related to product development, determination of product-line, purchase of inputs, inventories, location and layout of plant, production planning and control, plant maintenance, control of waste, quality and cost, finance and personnel.
It implies that marketing research has its hands in each and every aspect of manufacturing so that the manufacturer would design and implement his product policies, yielding best results.
2. Designing and Executing Marketing Strategies:
Marketing strategy is the dynamic, action-packed and all-pervasive plan to achieve business goals. A successful manufacturer is one who brings about an optimal adjustment of controllable and uncontrollable factors. The current market conditions are such that the manufacturers have to be market oriented.
Therefore, all their efforts are reconciled to the needs, moods and the pockets of consumers. A manufacturer can control the factors like product price promotion and distribution as they are internal to the firm.
There are uncontrollable factors like markets technological developments economic and social environment and governmental regulations which are external to the firm. It is the ability of the manufacturer to manipulate the internal factors and respect the external ones that make or mar the fortune of his.
Thus, marketing research is almost indispensable in planning and executing the marketing strategies because, it collects, analyses and interprets the relevant data thus, reinforcing the hands of the decision-maker in making sound and timely decisions to kick the threats and kiss the opportunities.
II. Distributors and Marketing Research:
Though production has the pride of place in any economic system, distribution becomes still more important because, production has no meaning unless it is made to absorb by markets through marketing efforts.
Distributors the vital link between producers and consumers stand to benefit by marketing research as under:
1. Location of the Outlet:
The success of a distributor depends on the strategic place of his selling outlet. While selecting the site, two aspects are given top priority namely region and specific site. Marketing research helps in finding out the regions with thick and rich population, encouraging business environment and suitable transport facilities.
Site selection takes into account the convenience of the spot such as warehousing facilities, banking facilities, accessibility to customers and competitors.
Scientific location increases the pulling power so that more and more customers are attracted.
A suitable trading area, the exact location of the outlet in that area along with special facilities of congenial atmosphere, more services, lower prices, latest products, parking facilities will make the company’s selling a great success.
2. Shaping and Improving Store Image:
Like a person, a store has its one individuality that distinguishes it from its competitors..This personality is to be identified and dramatized so that public confidence in its merchandise and services can be built. A consumer’s image of a store is the sum-total of his attitudes towards various aspects of that store.
These attitudes affect, in turn, his perception, motivation, inter personal response, traits and self- concept. Market research studies show that store’s image has given the factors influencing the consumer attitudes towards store, in terms of shopping practices and store characteristics.
These are locational convenience merchandise suitability, value for price, sales efforts and stores services, congeniality and post-transaction satisfaction. Such an in-depth study certainly helps the distributor to shape and improve the image of his store to get rewards commensurate with efforts and investment.
3. Distribution Cost Control and Reduction:
The modern production system has given us the goods at least cost, of better quality and inadequate quantity. However, the cost of distribution has been higher than that of production.
What is alarming is that these distribution costs are increasing over the years. A thread-bare study of these all marketing costs transport, warehousing, finance, advertising, consumer services, credit-returns and adjustments and the like should reveal some facts that help in plugging the wastes and inefficiencies in this crucial area of distribution.
Selective distribution activities should help in cost control. Cost reduction implies, here, improvement in efficiency level of distribution system or activities. It should be remembered that cost reduction cannot be at the cost of falling efficiency.
An effective cost accounting system can provide cost analysis that unearths the possible pockets of wastes and inefficiencies and helps in plugging these forever. This is the part of marketing research.
4. Merchandise-line Analysis:
Very often the middlemen both wholesalers and retailers, face a problem of the range of products they are to stock. Larger the product-lines and the varieties more will be the total sales as it helps the consumers to have wide choice.
However, the cost of handling these broader product-lines and larger varieties would be rising disproportionately because, all varieties in all product-lines will not move at the same or expected speed.
That is why, efforts should be made to measure the rates of turnover in case of each variety in each product-line so that slow moving items can be reduced and fast moving items can be increased by diverting the investments in inventories and reducing allied costs. Thus, marketing research assists distributors to select the most profitable merchandise lines and varieties so that the consumers pay less for the products and distributors get an attractive margin.
III. Advertising Agencies and Marketing Research:
Advertising agency does the work of planning and placing of ads created, copy-testing, media selection, assessment of ad effectiveness and so on. They do render a valuable service like consultation, research, planning of incentive campaign plans for salesmen and dealers, merchandising and the like.
As marketing research is one of the major services rendered by advertising agencies, each such agency has an independent marketing department.
The finding of such research can be fruitfully applied to the following areas by the business houses:
1. Budget Appropriations:
One of the basic decisions to be made by each advertiser is on, budget appropriations. That is, how much shall he spend? How? Where? And when? So as to pass on his message to the prospects and the consumers.
Advertising agencies, through market research studies advise their clients on how they should spend?
How much on each promotional device like advertising, personal selling and sales-promotion?
How much on each medium selected so that he gets maximum returns for his amount spent on advertising and other promotional efforts.
2. Preparation and Placement of Advertisements:
Advertisement preparation calls for planning in the light of constant and creative research conducting that helps in preparing creative advertisements for its clients.
Further, placement of advertisements on the various media is not a problem for these professional units having long standing contacts with media owners. It works out economical and effective as this placement is done on the basis of research findings.
3. Measuring Advertising Effectiveness:
The work of agencies is not over with only planning and placing an advertisement for its clients. More responsible and important task is that measuring the advertising effectiveness.
This assessment determines how far the advertiser has been benefited by the advertisement placed interposed in terms of impact and reach over the audience.
This establishes a definite relationship between sales generated and the amount spent on advertising.
Such a measurement is done through testing of advertising message copy before and after the release of an advertisement. Such an evaluation warrants collection, analysis and interpretation of data which is the part of marketing research.
4. The Study of Images:
Advertising agencies do undertake useful studies on images corporate brand and stores. Every company has a corporate identity from the moment it opens its doors, an identity representing what it has done to convey the public.
It is the sum-total of impressions that people have about the company. The factors making company image are its products packages, trade-marks, brand names company name, employee’s graphics marketing programme and the like.
A brand image is the sum-total of all those emotional and aesthetic qualities that the people associate with brand namely, a name, a symbol, a personality, a value a prestige, a quality for the consumer.
Stores have their own images built on the self- images of customers. Thus, a store’s image of meeting the requirements of rich class will not attract the consumers of middle and poor classes and accordingly, prices comforts facilities to the consumers are decided.
IV. Government and the Marketing Research:
Today’s states are no more ‘police’ states but ‘welfare’ states. That is why; modern governments have turned commercial to prove their worth in protecting the legitimate interests of consumers at large.
In such a stupendous task, these governments have to depend on marketing research to a very great extent which is quite evident from the following points.
1. Internal Management:
Management of economic system implies planning and controlling the various segments of it. It is basically the task of resource allocation on national and social priorities so as to have the optimum results. Control implies control of production, prices distribution and consumption. To discharge these responsibilities, governments will have to collect the relevant data, analyze it and interpret it.
The Yojana Bhavan is the brain-box of Indian government that gives blue prints for action, feed-back for actions followed on these aspects. Thus, whatever the government does, it does it through decisions and these sound decisions are based on the information provided by the research.
2. External Management:
There is continuous hunt for market expansion, beyond national boundaries. Governments are at constant work of exploring the new markets in the world for its products and services.
Such a study conducted is readily available to the individual exporters who cannot afford to spend their resources on such a time-consuming less productive activity. This also helps in balancing the domestic consumption along with exports.
The vital decisions on imports and exports are hinged on the exhaustive market researchers conducted. As it provides accurate information, excesses and their ill-effects on the economy can be curbed. Thus, the marketing research fortifies the statement “Export or Perish” by enabling the firms to export with careful study
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