Relation of Consumers Buying Habits to Marketing Methods - Research Proposal Example

Purpose of Business Research and Business Research Proposal Purpose of Research Methods: The study of research methods provides us the understanding and skills necessary to solve the problems and meet the challenges of a past-paced decision-making environment Cooper Donald R. and Schindler Pamela S.(2003) have defined the business research as systematic inquiry whose objective is to provide information to solve managerial problems. The factors responsible to stimulate an interest in scientific approach to decision making as categorized by the said authors are: The manager’s increasing demand for more and better information. The availability of sophisticated quantitative techniques. Information overload if discipline is not employed in the process. We have witnessed a dramatic change in business environment during the last three decades particularly keeping in view the increasing awareness of customers in quality and access of local and global competitors to the market of interest. Moreover, emerging from a historically economic role, the business organization has evolved in response to social and political mandate of national public policy, rapid technology growth and revolution in global communication. The authors cited above have identified the following factors which characterize the complex business decision making environment. More variables to consider in decision making. More knowledge exists in every field of management. Global and domestic competition. Theories and models are available to explain tactical and strategic results. Increasing concerns of governments on all aspects of society. Workers, stockholders, customers and general public demand to be included in decision making. Moreover increasing concerns of general public about environment and changing geo-political scenario of the world are continuously exerting pressure on world economy. Consequently the managers have to make decisions in more complex environment Emory C. William (1985) has cautioned that the risks associated with decision making environment have been substantially increased. The complexity of decision making environment warn that decision makers making decisions without sound a priori justification based on research are treading on dangerous grounds. To do well in such an environment, we will need to understand how to identify quality information and to recognize solid research on which high risk decisions can be based. Managers will also need to know how to conduct research. Developing these skills requires understanding the scientific method as it applies to managerial decision making environment. Recent years have seen emergence of research concerned with the human relations aspects of business. Morals and attitude studies have been conducted for many years. Cooper Donald R. and Schindler Pamela S. and Emory C William have attempted to make clear demarcation between Applied and Pure research. They have categorically mentioned that Applied research has a practical problem-solving emphasis whereas pure research is conducted for the advancement of theories and knowledge. The demarcation remains no longer clear when we have to consider psychological, social and behavioral aspects in business research. In seeking insight from business research there are two main requirements of the analysis. First, to identify the various explanatory variables, which influence an outcome and to quantify their effects. Second, to control all features which would, without such control, result in spurious relationships and misleading results. Business research is of much more recent origin and therefore there is a trade-off between complexity of the analysis and substantive insight it would provide. The situation demands to develop new sophisticated methods for obtaining necessary insight from the research results to reduce associated risks with the complex decision making environment. However, the weak point of the business research is that it is generally supported by the business organizations that hope to achieve competitive advantage. Research method and finding can not be patented, and sharing findings often results in a loss of competitive advantage. The more valuable the research result is, the greater the value in keeping it secret. Under such conditions, access to findings is obviously restricted. Even though there is growing amount of academic business research, it receives meager support when compared to research in the physical sciences Zikmund William G. (1997) has categorized the business research in two ways: Basic Research. Applied Research. The said author explained that the basic research attempts to expand the limits of knowledge and is not directly involved in the solution to a pragmatic problem. The above cited authors illustrate the concept of basic research with following examples: Is executive success correlated with high need for achievement? Are members of highly cohesive work groups more satisfied than members of less cohesive work groups? Do consumers experience cognitive dissonance in low-involvement situations? However, the author agrees with Cooper Donald R. and Schindler Pamela S. in defining Applied research which should be conducted when a decision must be made about a specific real-life problem. . Zikmund William G (1997) explained the explained the characteristics of Business Research as: Research information is neither intuitive nor haphazardly gathered. Literally, research (re-search) -“search again” Business research must be objective Detached and impersonal rather than biased It facilitates the managerial decision process for all aspects of a business. The cited author describe the decision-making process as: Identifying problems and opportunities Diagnosis and assessment Selecting and implementing a course of action Evaluating the course of action Writers usually treat research task as a sequential process involving several clearly defined steps. The process generally begins with management dilemma. This is usually a symptom of an acute problem. It is not difficult to identify management dilemma. However, choosing one dilemma to focus may be difficult. Careful exploration leads to well defined management dilemma which is translated into management question. Further exploration is suggested to translate management question into research question. Fine tuning of research question is essential because the research design is based on research question. Cooper Donald R and Schindler S. Pamela have suggested the following Management-Research question hierarchy. 1. Management Dilemma 2. Management Question 3. Research Question 4. Investigative Questions 5. Measurement Questions 6. Management Decision Weaknesses of Research Process: Some researchers become method bound. They recast the management question in such way so that they should be able to apply their favorite methodology. The availability of company data base distract the managers to avoid research Not all the management questions are researchable. The techniques and methodology applied to such question will be inadequate. Reitman B. Walter (1964) have described that some categories of problems are so complex and have so many constraints that they prove to be intractable to conventional techniques. RESEARCH PROPOSAL Title: Measures of Brand loyalty with special consideration for individual specific heterogeneity: An Application to Home Appliances Purchases A brief evaluation of brand loyalty reveals that this particular business discipline become the area of substantial interest for small and large organizations alike. Organizations can gain significant market share simply because of the efforts and endeavors put in to make their brands customer friendly, efficient, economically viable and perhaps most important of all the safety element. The brand loyalty can be perceived as to build a relationship with the customers. This relationship can be measured as the degree of customer satisfaction. The success of a company largely depends on its ability to retain the customers. Serafin and Horton (1994) have mentioned that every percentage point of loyalty is worth $100 million in profits as estimated by the former Ford vice president Basil Coughlan. Alonozo(1994) and Lefton (1993) have indicated that major organizations like Del Monte, Harley Davidson and General Motors are spending large sums of money to induce brand loyalty. Aaker (1991) conclude that the brand loyalty is the competitive advantage of the firm. The work of Copeland M. T. (1923) has received considerable attention keeping in view the increasing interest of the firms in inducing brand loyalty. Jacoby and Chestnut (1978) have described six requirements to define brand loyalty. These requirements are: Biased Behavioral Response Expressed over time By some decision making unit With respect to one ore more alternative brands out of set of such brands Is a function of psychological processes The proposed research will focus on estimating the brand loyalty and its effects on home Appliances purchases with particular reference individual specific heterogeneity. Literature Review Massy et al (1970) have mentioned that Morkov models are frequently used to measure brand loyalty because they are easily interpretable and their analysis is straightforward. Engel and Blackwel have expressed reservations on use of Morkov model to measure brand loyalty. One of the disadvantage of Morkov models is that these models assume the population of consumers as homogeneous hence all consumers have same conditional probabilities. Messy et al (1970) explained that the individual preferences play vital role in determining the brand loyalty. The estimates obtained by assuming the population of consumers homogeneous will be biased. Colombo and Morison (1989) have incorporated heterogeneity by assuming two groups of consumers. First the hard core loyal consumers who buy the same brand on each purchase and second the potential switchers who have tendency to buy different brands. The estimates obtained using Colombo and Morison models give more realistic estimates as those obtained by using Markov matrices. Hence these measures contain less spurious brand loyalty. The measure of Colombo and Morison is special case of latent class models. The more complex class of models in context of brand loyalty have been used by Grover and Srinivason (1987,1989). Jane, Base and Chen(1990) and Jain and Rao (1994). These models are theoretically more superior as the divide the population of consumers into different segments. Methodology The proposed study will overcome the consequences of the assumption of homogeneity of consumers which gives spurious estimates of brand loyalty by including in the internal structure of logistic model an individual specific random component term, which also account for unobserved determinants of consumers behavior. This procedure is in line with Alison (1987) and Davies et al (1992b). The individual specific heterogeneity in proposed logistic model is accounted for by two methods Assuming non parametric characterization of individual specific heterogeneity. Assuming Normal distribution for individual specific heterogeneity. Times Scale 1. Development of measurement tools and Pilot Testing 2 days 2. Sample Design and Data Collection 8 days 3. Data Analysis 2 days 4. Result reporting 2 days . References 1. Cooper Donald R & Schindler Pamela S(2003) ‘Business Research Methods’ Mcgraw Hill 2. Emory C William (1985) ‘Business Research Methods’R.D Irwin 3. Zikmund William G.(1997) ‘Business Research Methods’ Dryden Press 4. Aakcr, D.A., (1991 ‘Managing BI-and Equity’ The Frcc Press. New York 5. Colombo, R.A. and Morrison, D.G.. 1989. A Brand Switching Model with Implications forMarketing Strategies 6. Serafin, R. &Horton C. (1994) ‘Automakers Go a Long way to Keep Flock Loyal’ Advertising Age 65,13,S2+ 7. Massy, W.F.; Montgomery, D.B. and Morrison, D.G., (1970).’ Stochastic Models of Buying Behavior’ M..I.T. Press, Cambridge Massachusetts. 8. Colombo, R.A. and Morrison, D.G.. (1989).’ A Brand Switching Model with Implications for Marketing Strategie’. Marketing Science 8, 1, 89-99. 9. Alonozo, V (1994) ‘Til Death Do Us Part’ Incentive 168,4 37-42 10. Lefton, T. (1993) ‘Del Monte Puts House on the Market to Cross-Sell Brands’ Brandweek,34, 48, 34 11. Copeland M. T., (1923) ‘Relation of Consumer’s Buying Habits to Marketing Methods’ Harward Business Review 1, 2, 282-289 12. Engel, J.F. and Blackwell, K.D.,(1982), ‘Consumer Behavior, 4th ed.’ The Dryden Press, New York 13. Jacoby, J. and Chestnut, R.W.( 1978) ‘Brand Loyalty: Measurement and Management’ John Wiley & sons, New York 14. Grover. R, & Srinivason, V (1989) ‘An Approach for Tracking Within-Segment Shifts in Market Shares’ Journal of Marketing Research, 26, 2, 203-238. 15. Jain; D.Y.M., Bass, F.M. and Chen, Y.M.,( 1990)’ Estimation of Latent Class Models with Heterogeneous Choice Probabilities: an Application to Market Structuring.’ Journal of Marketing Research 27, 1, 94-110. 16. Jain, D.C. and Rao, R.C.(1994), Latent Class Models to Infer Market Structure: a Comparative Analysis” European Journal of Operation Research 76, 2, 331-343. 17. Alison. P. D. (1987) b’Introducing a Disturbance into Logit and Probit Regression Models’ Sociological Methods and Research,15, 355-374. 18. Davies R.B., Elias. P & Penn, R. (1992b) ‘The relationship Between Husband’s Unemployment and His Wife Participation in the Labor Force.’ Oxford Bulletin of Economics and Statistics, 54, 145-171. Read More