Marketing Research
Going On-line

By Arhan Sthapit

WITH the unprecedented boom of information and communications technology (ICT) coupled with the rapid growth of personal computers with expanded Internet connectivity, marketing research activities have also gone on-line with flying colours. Worldwide, use of the Internet in marketing researchers' works has almost exploded.

New Avenue

Marketing research that is the impetus to the making of all crucial decisions in business organisations has found new avenues of operations, as the IT Revolution has handed in the on-line techniques. The money spent on online research efforts in the US in 1996 -according to a survey of the Inside Research- had amounted to nearly US$3 million, which is estimated to have crossed the 460 million dollars mark by the turn of the new millennium, making the online marketing research a global phenomenon. This -analysts say- indicates an annual growth of over 250 per cent.

Hence, the use of online to conduct marketing research shows no sign of abating, despite the volatility of the stock prices of the Internet-based firms, particularly those of dot.com companies in the US after 2001-2. The volatility is evident from the track record of the NASDAQ, the industrial average index of the IT-heavy firms.

In 2002 alone, the online marketing research is estimated to have accounted for almost US$800 million in spending, as per the Inside Research's survey.

The online research has ushered in a new era of research by expanding the traditionally specified scope of marketing research. The new marketing research activities, which are purely the outcome of the online research, are: measurement of Web-site audiences and 'surfing' activity, testing of the online advertisement effectiveness, and gauging reactions to the Websites themselves.
The traditional marketing research activities broadly include product research, promotion and advertising research, concept testing, psychographic, attitude and motivation research, target market/segmentation research, sales performance and potential research, customer satisfaction studies and business economics/corporate research.

More firms worldwide have increased use of online research in gauging buyers' behaviour including their attitude, motivation and other psychographic aspects.

Because of the online methods, more firms have switched from their traditional reliance on marketing research service providers (MRSPs) over to the in-house marketing research activities. The online methods have enabled firms to benefit from the merits of cost-effectiveness and speediness, as well as 'validity' of the research. Firms-when conduct research activities themselves without hiring the MRSPs- have felt convenience in using online methods in lieu of traditional contact techniques like telephones, mail questionnaires or face-to-face surveys.

Alternately, Yahoo!, Expedia, Microsoft, Intel and Sun Microsystems are the major companies worth emulating. General Mills, Procter & Gamble, Kimberly-Clark and Kraft are substantially using online methods to conduct marketing research.

It is, however, very important that companies should make judicious examination of the pros and cons of online research methods before applying them to quantitative and qualitative research activities.
The online methods-when applied to the quantitative research that uses questionnaires and interviews/surveys- could save not only total cost but also cost per respondent. They are speedier than traditional techniques of face-to-face, telephone, mail and shopping-mall surveys. Going by a General Mills example, online methods reduced the time needed to complete a survey by two-thirds, and saved cost by 50 per cent.

A study conducted by experts at the University of Wisconsin's A.C. Nielsen Center for Marketing Research tells a similar story. The survey adds the online methods can noticeably reduce interviewers/enumerators' bias, and make it easier to examine data as they are collected.

For obvious socio-cultural and psychological reasons, many researchers themselves have preferred online surveys. A global survey of Burke Interactive shows that when given a choice between taking a survey over the telephone or the World Wide Web (www), as many as 90 per cent of the people with the Web access opted for doing it via the Internet.

However, an online questionnaire that requires respondents to type answers to a lot of 'open-ended questions' takes more time than a survey administered via the phone. The use of 'close-ended' and dichotomous (yes-no) questions can solve this problem.

Choice studies ask consumers to pick among a set of sometimes complex product configurations. To conduct such a study via the telephone, we shall typically have to mail a set of materials to respondents to look at, ahead of time. Researchers also had to employ experimental designs to create a limited set of choice tasks. Online methods solve this problem too, and let researchers present respondents with visual stimuli in a way that could not be done over the phone.

Online methods-when applied to qualitative marketing research-prove good for gathering qualitative feedback. Online focus groups are timed; moderated "chat" sessions can bring together geographically dispersed respondents. Online bulletin boards allow respondents to provide input on their own convenient schedule over a longer period of time.

Compared to moderated, in-person discussions, online focus groups tend to generate about 75 per cent as much content in the same period of time. 'Group dominators' cannot unnecessarily influence online focus groups, as they do the in-person sessions.

Technology also allows participants to examine multimedia stimuli online during focus group surveys. In addition, quantitative instruments can be used in conjunction with online focus groups, so that participants can provide survey inputs, then immediately see how their opinions compared to others in the group.

However, online methods suffer from the difficulty verifying the identity of online respondents. The coverage of target respondents is also another questionable issue, more so in case of a country like Nepal where the percentage population having Internet access has not increased from a single digit figure.

It also involves the security risks, as new product concepts or designs put on the online survey can be unduly imitated and its patent rights infringed.

Another demerit is that it is subject to intense self-selection bias, as not the researching company can make the respondent participate, but he himself will have to volunteer to select and participate in the survey.

Change Agent

Despite these drawbacks, online methods have already become an agent of changes in what activities marketing researchers can and do undertake. The global nature of the Web has made online research an important means for the research community allowing them more access to expanded research services and innovation. In view of the current trend towards globalisation and of ICT boom, marketing research without use of online methods will simply become an archaic concept.

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