Marketing Research For Chua Company example essay topic

1.0 Introduction Researching the market in which a company target is the essential first step. Opportunities for markets need to be identified, as well as obstacles to market access in overseas countries. Moreover, the environment is dynamic: changes brought about by political, social, economic and other developments must be monitored, and their effects on market prospects and access assessed by management. The function of marketing research is often concerned with the process of collecting, analyzing and interpreting the facts to establish what it is that people want and why they want it. It therefore includes market studies and any other research relevant to marketing operations. The case study of CHUA company illustrate situations where marketing research was conducted and which was the marketing research approaches applied when assessing the potential of Thailand market.

Three central considerations are: (1) the need to define the specific problem properly; (2) the need to translate it into the form amenable to data collection, and (3) to appreciate the context of the research. Research should be effectively integrated into the decision-making system. Consideration was given to some of the parameters in designing the marketing information system, and some problems in its implementation were investigated. Proper market research can reduce or eliminate most international business blunders. Market researchers can uncover adaptation needs and proper market strategies. Specific data requirements depend on the company, its products, and the type of decisions being made.

Different sets of data are needed for a company to determine whether or not to go abroad, which countries to enter, how to enter the foreign markets, and what the best marketing strategies are. Research methods must be tailored to the particular situation. 2.0 Necessity of Marketing Research Marketing research is important for an organization or company as the results of the data may help them in making a decision that will affects their company objectives. CHUA Company may assume the need for conducting a marketing research, arises from the following four factors namely time constraints, availability of data, nature of decision and benefits vs. cost. Exhibit 1-1 outlines the criteria for determining when to conduct marketing research.

(Zikmund, 2000, p. 20) Exhibit 1-1 Determining When to Conduct Marketing Research Time Constraints No Yes Availability of Data No Yes Nature of Decision No Yes Benefits versus Costs No Yes Time constraints Before conducting a marketing research, it is important for the management to be aware that they must allocate an adequate amount of time for the conduct of the marketing research. In most cases, management is pressured to decide without sufficient data to necessitate the correct decision. It is appropriate that decisions made are based on the data of the research that has been collected and analyzed in a given reasonable time. Availability of Data The availability of data is crucial. If there is not enough relevant data, management might not make the right decision. Therefore, management would be requested to conduct a marketing research to further obtain data.

Sometimes, even though that the initial data is available and enough, it could be probably outdated or not valid to impose a decision base on it. Having marketing research to collect more data could further update, strengthen and prove a probable management hypothesis before making a decision. Nature of Decision Value of marketing research will depend on the nature of managerial decision to be made. A routine tactical decision that does not require a substantial investment may not seem to warrant a substantial expenditure for marketing research. (Zikmund, 2003, p. 19) Benefits Versus Costs The cost of conducting a marketing research does not come cheap as it involves time, money, manpower and resources. In the manager's perspective point of view, therefore it is vital that the cost invested into research will bring about significant benefits.

3.0 Stages in the Research Process In this case CHUA Company intends to target hand-phone sales into Thailand. In deciding to abroad, CHUA Company needs to define its international marketing objectives and policies. Firstly, the company must conduct the following marketing research approach in rating these three criteria: market attractiveness, competitive advantage and risk. In creating all elements of marketing mix, company must aware of the difference cultural, social, political, technological, environmental and legal limitations of Thailand.

CHUA Company planned to govern the organization of international marketing research encapsulate delegation of work to regional agencies, Opinion Research Company (ORC) to conduct the marketing research. Marketing research is a planned formal approach to the collection of marketing information. Exhibit 3.1 shows the six stages as a cyclical process. The circular flow concept is used because the conclusions from research studies usually generate new ideas and problems that need to be investigated. Exhibit 3-1 Stages of the Research Process (Zikmund, 2000, p. 60) And so on 3.1 Problem Definition The research process for Opinion Research Company (ORC) begins with the recognition of a marketing problem or opportunity for CHUA Company. Marketing research could be used to evaluate product, promotion, and place, pricing alternatives or market opportunity.

As with in this case it is an opportunity to increase profit by entering into the global market. The research objectives in such a case would be to find out quantifiable measure of how many customers are likely to be attached. 3.2 Deciding which Market to Enter To decide upon which market to enter depends onto the potential of the targeted segmentation to bring maximum profit or opportunity. As with penetrating into an international market, it will depend onto the company's product or services that will be beneficial or needed by that country. Therefore it is important that a company deciding to venture business into another country must do a through research on the country and people and know the factor that might affect their business success. Using four basic elements - market size, market growth rate, government regulations, and economic and political stability - enable to quantify the 'country attractiveness'.

(Oliver, 1995, p. 469) In this case, certain markets such as Thailand tend to attract competition from all over the world, first because it has a large market, with an increasing GNP per capita, which means high spending power of the consumer. Secondly, the country's telecom services are run by the three states agencies-the Telephone Organization of Thailand (TOT), Communications Authority of Thailand (CAT) and the Post and Telegraph Department. Telecommunications is still a growing industry in Thailand and there are an estimated 3.2 lines per 1000 persons in Thailand. This is one of the reasons for the phenomenal proliferation of mobile phones, which are not only status symbols but are necessities for people caught in traffic jams or living in estates to which phones are not yet connected. 3.3 Types of International Marketing Research Approach Marketing problems come in many guises; research problems too. Four broad categories of research approaches have been identified: exploratory, descriptive, causal and quantitative.

Since the marketing research for CHUA Company require understanding of the environment in Thailand and to have quantifiable measure of how many Thai customers are likely to interest in owning a hand-phone. Objective 1 will be dealt with by exploratory research but objective 2 demands a quantitative study. Selection of a type a study depends heavily on the research objectives. It also depends on available data, budgets, time pressures and the experience of the potential users. Actually, in many cases, a research objective will require multiple research approaches, often in sequence. For instance in the case of CHUA Company, ORC would conduct the multiple marketing research by applying the following exploratory (qualitative) and quantitative research.

Exploratory Research (qualitative) Exploratory research is usually a small-scale research undertaken to define the exact nature of the problem and to gain better understanding of the environment within which the problem has occurred. It is often necessary to conduct exploratory research during the early stage. Exploratory tends to be highly flexible, with researchers following ideas, clues and hunches as long as time and money constraints permit. In the exploratory research process, a list of problems and sub-problems should be developed. The investigators should discern all the probable factors that seem to be somehow related to the problem. In deciding whether or not to market and if so, how to market in a given country or set countries, exploratory research can provide some initial indication as likely responses, as well as attributes used in evaluating products and different scenarios in which products might be used.

Taking note however, if giving only a short time frame, the problem definition phase is often not given proper attention, as exploratory research is very time consuming. It can be costly if the research process is not on the right track. When entering into the global market, lack of familiarity with customers, competitors and the market environment in other countries coupled with the growing complexity and diversity of international markets makes it increasingly critical to collect information in relation to these markets. (Craig & Douglas, 2000, p. 1) Therefore it is important to realize that international markets change rapidly in terms of political, economic, social, technology (PEST).

The followings defined the major problems for international marketing research. According to other problems that need to be addressed are marketing, legal and structural. (Bains & Chansarkar, 2002, p. 21) Political The nature of political involvement in geographic markets may impact differently in different countries. Political have tended to impose regulations on domestic companies in order to promote competition and restrictions on foreign competitors in order to protect their market. For instances, under Shariah Law in muslim countries, they are strict in prohibition of the sale of alcohol. In Thailand, the royalties especially the king are well respected and loved by his fellow countrymen.

The king is well educated and has contributed many things to his people and has always pushed forward technology advances. The high level of military presence in Thailand also makes the country safe Economical The wealth of a country generally determines its lifestyle. Example, Honda selected a three-year projected average annual sale in units. The GDP of each country may be used as an indicator plus, if the statistics are available, patterns of consumption, population, income distribution, disposable income, etc. Currency fluctuations will also have an impact on price of the product. Thailand has an open market economy based on free enterprise, where the private sector has been allowed to develop with relatively little supervision, other than bureaucratic procedures.

There is also an increasing GNP per capita. Social This is the most important aspect of the international environment as it relates to difference in language, culture, literacy and numeracy. For example, it is clear that a company distributing pork would have to take account the religion of the people in specific countries since this would determine whether they would buy it. In addition to affecting the process of research, social norms differences often affect habits, attitudes, opinions and values, all of which can impact upon how products and services are purchased by consumers. (Bains & Chansarkar, 2002, p. 213) Researcher needs to understand how the cultural values of a society will affect the approach to the research issue of interest. It may be possible to research problems in one culture but not in another because cultural taboos and different levels of abstraction.

(Proctor, 2000, p. 387). For example, transvestites in Thailand are a common sight whereas in other countries they are not well received. Technology This is related to a country's capacity to innovate and its abilities to use technology knowledge. In countries where there is lack of technological innovation, there is usually a tendency to resist products and services that rely on sophisticated technological methods.

The degrees to which personal computers and information technology have penetrated the culture of a country affect the research process and its design considerably. (Bains & Chansarkar, 2002, p. 213) Technological changes make product development; production process and experience rapidly obsolete and contribute to heightened competitive pressures as well as social change. For instance in this case, because the product hand-phone represented a new technology to the population wide in Thailand. CHUA Company should trained customers proper usage of hand-phone, to minimize radiation exposure. The four factors- political, economic, social, technologies (PEST) have already been highlighted.

ORC could also address other factors marketing, market share, legal and structural. Marketing This generally refers to the extent to which the marketing mix (4 Ps-product, place, price and promotion or 7 Ps for services - people, physical evidence and process) differs in each country. For instances, marketing research regarding pricing for a product launch in the Middle East would need to take into account of the bartering that occurs in these cultures. The extent to which companies have adopted the marketing philosophy and achieved a marketing orientation also determines the type of research undertaken. (Bains & Chansarkar, 2002, p. 211) Market Share An organization needs to take account of the number of competitors and how hard they will fight to retain their share of the market, and the basis on which this might be done. Legal Since countries have their own legal systems, the laws relating to marketing, products and services and business in general all differ depending on the country and location in which the organization is based.

For example, distribution arrangements are covered by law, especially the manufacture of chemical, nuclear and biological material. Proper identification as a problem needs to be addressed. (Bains & Chansarkar, 2002, p. 212) In this case, Thai government could be said to be one of the problems of Thailand. Though the government has maintained a consistently pro-business attitude, it has also been very reluctant to allow foreigners to own property or control companies.

Structural Infrastructure, communication networks and the nature of the industry all impact upon the marketing activity of a firm. Marketing research into international markets may need to take into account the differences in telephone usage since this affects the use of telephone interviewing techniques. An understanding of the degree of television penetration (the extent to which television sets are owned by the population), and the nature of the audience breakdown by different channel, is also important since it has an impact upon the conduct of advertising research. The efficiency of the postal service tends to be different in different countries, thereby affecting the decision of whether or not to use mail survey methodology. Quantitative Research Quantitative studies are often preceded by qualitative research that explores the issues to be studied or tests the questions to be asked. Because quantitative studies involve large numbers of interviews, they tend to be more expensive and can take longer to implement than qualitative research.

Once a quantitative survey has been chosen as the hand-phone investigation, ORC will have to deal with a survey employing highly structured procedures. These concern the sampling approach, the data collection method, the questionnaire structure, the fieldworkers' training and competence, the data preparation, data analysis and reporting. Quantitative research can be carried out face-to-face, over the telephone, by mail or observation. In the case of CHUA Company, ORC would conduct the face-to face interview, survey and observation under the quantitative research.

3.4 Identify Information Types and Sources Marketing research collects data to answer questions, and so the methods and sources of collecting these data are the substance of the research operation. Table 3.2 shows the major types of data category. Most attention here will be given to external data, but internal records are also essential. There are two major problems associated with international marketing research.

The first is the availability, validity and comparability of secondary data, which may not be of the standard researchers expected in their own country. Second, in attempting to collect primary data, researcher may encounter practical difficulties such as accurate translation of questionnaires and obtaining responses from a representative sample in the target market. Table 3-2 Major Data Sources (Oliver, 1995, p. 133) After ORC have identified what information are available or not available, they will then proceed into choosing which data collection method they need to use to get more information which are lacking or to further confirm a hypothesis. For this case, ORC would first gather secondary data; they may also want to use primary data where they can use either through face-to face interview, survey, observation or questionnaire. Therefore ORC can have updated and more relevant data.

Secondary data Secondary information consists mostly of paper based trade directories, government reports or sector reports, presented a board perspective, but took a long time to compile, print and disseminate. ORC could gather data and information from internal and external sources as stated following. Internal Source Published secondary information originating within company include documents such as annual reports to stockholders, product testing results and house periodicals composed by the company's personnel for communication to employees, customers, or others. Often this information is incorporated into a company's internal database. Internal sources are compiled by traveling managers, subsidiary managers, and oversea representative. External Source Principally in the form of government (federal, state, and local) departments and agencies who compile and publish summaries of business data.

Trade and industry associations provide publish summaries of business data. The analysis and understanding of culture is a vast subject covered by many books on anthropology and sociology as well as international business and marketing. In this case, ORC could get information from Industrial Estates Authority of Thailand (I EAT), whose authority encompasses most of the initial setup activities of an investor manufacturer or importer; facilities with advice on market sizes and shares are widely available. If independent advice is required, market research consultants are listed in the English Bangkok phone directory. The Board of Investment (BOI) operates extensively through Thai embassies outside Thailand, providing useful information regarding investment in Thailand, including the rules and regulations governing it, also provides information on the size of some markets, as does the Bureau of Statistics. Other sources of market research include the Thailand Productivity Institute, which was formed in 1994 under the Ministry of Industry.

They can also check the Internet for specific industry surveys. Advantages Help to clarify or redefine the definition of the problem as part of the exploratory research process. Provide a solution to the problem. May provide primary data method alternatives. May alert the marketing researcher to potential problems or difficulties. Disadvantages Lack of availability Lack of relevance Inaccurate data Insufficient data Primary data Primary research (expensive to conduct) is the most desired information, especially as it provides the opportunity for the company to tailor the event to its own particular research requirements.

Survey (example one to one interview) might not be the best data collection tools. Probably observation survey method could be a good data collection tool and not as expensive as the former. Surface and airmail services are cheap but unreliable in Thailand; therefore it is not practical to conduct the survey by mailing. ORC have decided to conduct observation and survey questionnaires to collect primary data for CHUA Company. Observation Research that monitors respondents' actions without direct interaction (for example cars, electro-mechanical devices such as cameras or tape recorders and so on).

In this case, exhibitions, conventions, trade fairs and other promotions that offer people a chance to meet and talk about the products are good ideas-though costly ones. ORC can observe the behavior of the consumer for owning a hand-phone and which segment of consumer to target. In the past, education in Thailand was largely the realm of the wealthy, the upper class and the urban population. The rural population was rarely educated.

After the revolution, however universal education was gradually introduced. The official language of Thailand is Thai but the language has many distinct regional dialects, like Chinese and English. Over half the population is less than 30 years of age, and this young educated population sector is a major marketing target. Survey Questionnaire This is the most commonly used method of data collection, which can be conducted by in street, in-store, or business survey; ensuring both reliability and validity of survey results. In Thailand, the availability of interviewers is often high and the costs are low. Questionnaires can be self-administered or used in an interview situation, depending on: Cost Timing Type of information needed Amount of information needed Ease of questioning Accuracy required The face-to-face encounter achieves quality data in a number of ways.

Respondent selection: The interviewer can check and ensure respondent eligibility before the interview is conducted. Response: The interview-administered survey can ensure that the target number of interviews is achieved. Data collection: A personally administered questionnaires ensures that questions are asked in the right order; all applicable questions are answered; and the respondent understands the question in the first place. Administration: Control over how the interview is administered and use of show material is essential for reliable data. The interviewer ensures that materials are seemed in the correct order, properly presented. Innovations in research: The skill of the professional interviewer has allowed methodologies to become more complex and sophisticated, achieving a greater degree of accuracy and finesse from the data.

In-Street Survey Normally in street interviewing is conducted in busy town centers. This positioning ensures a good flow of people representing a good cross-section of the local population. Another plus is that sampling can be geographically specific and any building or street lacking of customers would be determined. In-Store Survey Many surveys take place in a shop, or just outside the shop.

Personal interviewing in-store will meet the requirements of a limited number of surveys but should be considered in line with research objectives. Interviewing at store may bias response, as the survey is likely to concern some aspect of shopping related to that store, but there is no better way to evaluate a shop display than in the shop. It is a good way to assess shoppers' opinions through their experience rather than their memory of the experience. Business Survey The respondent's office is a popular venue for carrying out face-to face business or industrial interviews. Interviewers are able to interview and conducting survey to determine the number of organization buyers who are interested to the corporate plan which is all custom made to the requirements stated by the organization, with the cheapest competitive hand-phone price rate.

3.5 Data Gathering The data collection phase is typically a period of waiting for the researcher. It is important to observe the data collection process to reduce error. Therefore it is mostly crucial to pretest a procedure before going to a big sample. At the very least, the researchers should force themselves and a few convenient subjects to go through the process. (Lehmann, Gupta & St eckel, 1998, p. 69) This is in order to weed out potential errors or problems that may be counterproductive to the research process. 3.6 Analyze and Interpret Data After the data have been collected, the next step is data analysis.

The purpose of this analysis is to interpret and draw conclusions from the mass of collected data. The marketing research may use techniques beginning with simple frequency analysis and ultimately culminating in complex multivariate techniques. (Gates & Mcdaniel, 1998, p. 34) 3.7 Present Research Report After completing the data analysis, the researcher must prepare the report and communicate the conclusions and recommendations to management. This is the key step in the process because a marketing researcher of ORC who wants conclusions acted upon must convince the CHUA Company that the results are credible and justified by the data collected.