Step 3 Collect the Information

The data collection phase of marketing research is generally the most expensive and the most prone to error. In the case of surveys, four major problems arise. Some respondents will not be at home and must be recontacted or replaced. Other respondents will refuse to cooperate. Still others will give biased or dishonest answers. Finally, some interviewers will be biased or dishonest.

Yet data collection methods are rapidly improving thanks to computers and telecommunications. Some research firms interview from a centralized location. Professional interviewers sit in booths and draw telephone numbers at random. When the phone is answered, the interviewer reads a set of questions from a monitor and types the respondents' answers into a computer. This procedure eliminates editing and coding, reduces errors, saves time, and produces all the required statistics. Other research firms have set up interactive terminals in shopping centers. Persons willing to be interviewed sit at a terminal, read the questions from the monitor, and type in their answers. Most respondents enjoy this form of "robot" interviewing.20

Several recent technical advances have permitted marketers to research the sales impact of ads and sales promotion. Information Resources, Inc. recruits a panel of supermarkets equipped with scanners and electronic cash registers. Scanners read the universal product code on each product purchased, recording the brand, size, and price for inventory and ordering purposes. Meanwhile, the firm has recruited a panel of these stores' customers who have agreed to charge their purchases with a special Shopper's Hotline ID card, which holds information about household characteristics, lifestyle, and income. These same customers have also agreed to let their television-viewing habits be monitored by a black box. All consumer panelists receive their programs through cable television, and Information Resources controls the advertising messages being sent to their houses. The firm can then capture through store purchases which ads led to more purchasing and by which cus- Gathering Information tomers.21 and Measuring

Market Demand M113]

marketing researcher's report may seem abstract, complicated, and tentative. Yet in the more progressive companies, marketing researchers are increasingly being included as members of the product management team, and their influence on marketing strategy is growing.

A growing number of organizations are using a marketing decision support system to help their marketing managers make better decisions. Little defines an MDSS as follows:

■ A marketing decision support system (MDSS) is a coordinated collection of data, systems, tools, and techniques with supporting software and hardware by which an organization gathers and interprets relevant information from business and environment and turns it into a basis for marketing action.22

Table 1.6 describes the major statistical tools, models, and optimization routines that comprise a modern MDSS. Lilien and Rangaswamy recently published Marketing Engineering: Computer-Assisted Marketing Analysis and Planning, which provides a package of widely used modeling software tools.23

The April 13, 1998, issue of Marketing News lists over 100 current marketing and sales software programs that assist in designing marketing research studies, segmenting markets, setting prices and advertising budgets, analyzing media, and planning sales force activity. Here are examples of decision models that have been used by marketing managers:

BRANDAID: A flexible marketing-mix model focused on consumer packaged goods whose elements are a manufacturer, competitors, retailers, consumers, and the general environment. The model contains submodels for advertising, pricing, and competition. The model is calibrated with a creative blending of judgment, historical analysis, tracking, field experimentation, and adaptive control.24

CALLPLAN: A model to help salespeople determine the number of calls to make per period to each prospect and current client. The model takes into account travel time as well as selling time. The model was tested at United Airlines with an experimental group that managed to increase its sales over a matched control group by 8 percentage points.25 DETAILER: A model to help salespeople determine which customers to call on and which products to represent on each call. This model was largely developed for pharmaceutical detail people calling on physicians where they could represent no more than three products on a call. In two applications, the model yielded strong profit improvements.26 GEOLINE: A model for designing sales and service territories that satisfies three principles: the territories equalize sales workloads; each territory consists of adjacent areas; and the territories are compact. Several successful applications were re-


MEDIAC: A model to help an advertiser buy media for a year. The media planning model includes market-segment delineation, sales potential estimation, diminishing marginal returns, forgetting, timing issues, and competitor media schedules.28

Some models now claim to duplicate the way expert marketers normally make their decisions. Some recent expert system models include:

PROMOTER evaluates sales promotions by determining baseline sales (what sales would have been without promotion) and measuring the increase over baseline associated with the promotion.29 ADCAD recommends the type of ad (humorous, slice of life, and so on) to use given the marketing goals, product characteristics, target market, and competitive situation.30

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