University of Southern California
Marshall School of Business
Lars Perner, Ph.D., Instructor
SUMMARY OF CLASSROOM MATERIAL
is often needed to ensure that we produce what customers really want and
not what we
Primary vs. secondary research methods
. There are two main approaches to marketing.
research involves using information that others have already put together. For
example, if you are thinking about starting a business making clothes for tall people, you
don’t need to question people about how tall they are to find out how many tall people
exist—that information has already been published by the U.S. Government.
research, in contrast, is research that you design and conduct yourself. For example, you
may need to find out whether consumers would prefer that your soft drinks be sweater or
Research will often help us
associated with a new product, but it
cannot take the
risk away entirely
. It is also important to ascertain whether the research has been complete.
For example, Coca Cola did a great deal of research prior to releasing the New Coke, and
consumers seemed to prefer the taste. However, consumers were
prepared to have this
drink replace traditional Coke.
. For more information about secondary market research tools and issues,
please see the separate handout at
. Several tools are available to the market researcher—e.g., mail
questionnaires, phone surveys, observation, and focus groups. Please see the chart provided
in class and available at
for advantages and
disadvantages of each.
are useful for getting a great deal of specific information. Surveys can contain open-
ended questions (e.g., “In which city and state were you born? ____________”) or closed-
ended, where the respondent is asked to select answers from a brief list (e.g., “__Male ___
Female.” Open ended questions have the advantage that the respondent is not limited to the
options listed, and that the respondent is not being influenced by seeing a list of responses.
However, open-ended questions are often skipped by respondents, and coding them can be
quite a challenge. In general, for surveys to yield meaningful responses, sample sizes of over
100 are usually required because precision is essential. For example, if a market share of
twenty percent would result in a loss while thirty percent would be profitable, a confidence
interval of 20-35% is too wide to be useful.
Surveys come in several different forms. Mail surveys are relatively inexpensive, but response
rates are typically quite low—typically from 5-20%. Phone-surveys get somewhat higher
response rates, but not many questions can be asked because many answer options have to be
repeated and few people are willing to stay on the phone for more than five minutes. Mall