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Understanding Customer Needs

Uploaded: 6 years ago
Contributor: cloveb
Category: Marketing
Type: Lecture Notes
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Filename:   Understanding Customer Needs.docx (36.11 kB)
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Credit Cost: 1
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Understanding Customer Needs MULTIPLE CHOICE Companies that try to push a good or a service on customers are destined to fail without a proper understanding of the competition. media planning. customer needs. advertising research. the marketing mix. Answer: c When the sales department drops prices to secure a contract, while the marketing function is trying to build the brand and maintain price premiums, the brand is more competitive. using a pull strategy. using a push strategy. devalued in the marketplace. number one in the marketplace. Answer: d In organizations where there is no clear and widely shared understanding of customer needs all functions are integrated. operations are streamlined. departments have multiple responsibilities. the marketing direction is determined by the sales function. each function does its own thing. Answer: e An accurate understanding of customer needs allows a company to create customer value. meet financial objectives. respond to competitive threats. perfect advertising messages. develop media plans. Answer: a Companies that do not understand their customers are likely to spend less on advertising. maintain price premiums. have synergy among all their functions. create customer value. focus solely on the technology. Answer: e Southwest Airlines' decision to focus on the customer segment that does not want frills, only low fares, demonstrates the firm’s deep understanding of customer needs. economies of scale. advertising. public relations. the competition. Answer: a When Sony targeted the Walkman to joggers who would appreciate the break from a tedious activity, the company was conducting research. narrowcasting. repositioning the product. creating a customer need. trying out various sales strategies. Answer: d Danone created a new market for its Danone Actimel yogurt by focusing on a specific audience segment. increasing advertising spending. expanding distribution. using just a health appeal in their advertising. combining health benefits and taste. Answer: e Research that has already been conducted by someone else is referred to as primary research. secondary research. qualitative research. quantitative research. a survey. Answer: b Qualitative techniques include ethnography. mall intercept surveys. telephone surveys. online questionnaires. secondary research. Answer: a A guided discussion with a group of respondents such as customers is referred to as participant observation. a group survey. an in-store survey. a depth interview. a focus group. Answer: e Before conducting primary research, this technique can help identify gaps in knowledge and what traps to avoid. focus groups secondary research ethnographies depth interviews exploratory research Answer: b An advantage of secondary research is that you conduct the research yourself. it takes longer than primary research. it can be expensive. you may find the answer you are researching. there are few sources of secondary data. Answer: d Common sources for secondary research include focus groups. depth interviews. ethnographies. company employees. professional associations. Answer: e A caution you should heed when conducting secondary research is that the research may be biased. it is relevant to your marketing problem. published sources are always reliable. all research objectives are similar. most research is current. Answer: a The main goal of primary research techniques is to identify gaps in knowledge. explore the dimensions of a problem and generate ideas. learn what traps to avoid. determine research objectives. gather customer insights from databases. Answer: b Focus groups are conducted online. in shopping malls. over the phone. by a moderator. by a secondary research source. Answer: d Focus groups allow clients to test marketing communications messages. interact directly with customers. gather quantitative data. ensure the moderator follows the guide. gather research for free. Answer: a If Kodak wanted to test its customers’ reaction to a new digital camera innovation, which research methodology would be best suited to this? mall intercept surveys. telephone surveys. online questionnaires. depth interviews. focus groups. Answer: e A data collection method where the moderator engages one respondent in a conversation for at least 60 minutes is referred to as a depth interview. a focus group. an online survey. a telephone survey. an in-store survey. Answer: a If a company marketing medical diagnostic equipment wants to understand the buying decision-making process, it should conduct research with physicians using which technique? a telephone survey an online survey participant observation a hospital questionnaire a depth interview Answer: e In ethnographies, the researcher becomes the secondary source. the moderator. the customer. the marketer. the interviewer. Answer: c A process where the researcher actively participates with the customer to gain insights is referred to as a focus group. a depth interview. a mall intercept survey. secondary research. participant observation. Answer: e DeWalt's sending researchers to work alongside professionals who work with their tools is an example of a depth interview. a focus group. participant observation. public relations. direct marketing. Answer: c When trying to understand why its customers might tattoo the brand name on their bodies, Harley Davidson might turn to focus groups. ethnography. depth interviews. online surveys. customer satisfaction surveys. Answer: b Quantitative data collection by means of a questionnaire is referred to as a survey. a depth interview. a focus group. participant observation. sales tracking. Answer: a All questionnaires include this class of questions. primary secondary product concept demographic variables participant observation Answer: d Unlike qualitative research methods, survey research is used to collect data from a small group of customers a large sample of respondents focus group participants depth interview participants researchers who become the customer Answer: b Surveys are not used to generate ideas but to test new product concepts. test key marketing messages. validate ideas. understand the buying process. explore the dimensions of a problem. Answer: c Page: 36 The main problem with using marketing research to understand customer needs is that the research may be biased. the research may be outdated. the research objectives may not match your objectives. customers may not be able to articulate their needs. the moderator may not follow the guide. Answer: d Page: 37 Customers are always able to articulate their needs in terms of their attitudes and feelings. their behaviour. their demographic variables. their psychographic variables. their basic care needs. Answer: e Page: 37 One problem that companies face is that by the time the research takes place, the marketing budget is spent. competitors beat them to the marketplace. the market opportunity may have passed. the secondary research is outdated. the focus group participants are no longer customers. Answer: c Page: 37 Smart companies challenging the product-centric approach to marketing are embracing a method whereby they are co-creating value with their customers. determining what’s best for their customers. conducting secondary research. conducting primary research. becoming the customer. Answer: a Page: 38 By allowing customers to customize their bear and meet an unlimited set of needs, Build-A-Bear is conducting market research. segmenting their target audience. maximizing resources. communicating key messages to customers. involving the customer in the innovation process. Answer: e The medium that allows smart companies to involve the consumer in the innovation process is television. radio. the internet. newspapers. magazines. Answer: c Manufacturers often naively believe that their only competitors are national brands. heavily advertised brands. in the same country. in the same city. in the same industry. Answer: e Page: 39 When FedEx, the overnight package delivery company, bought Kinko's, the document printing company, they became an example of a company that acts first, then tweaks later. co-creates customer value. treats the whole world as a research firm. looks across the chain of buyers. looks at substitute industries. Answer: d Page: 40 Looking across complementary product and service offerings is one way a company can test new message strategies. test new product concepts. co-create customer value. create new market space. research the competition. Answer: d Page: 40 Most competitors look the same, offer the same value, and commoditize the industry because they offer complementary products. focus on a common set of appeals. focus on different types of buyers. co-create value with the customer. conduct similar research studies. Answer: b Page: 42 Starbucks was able to break free of the price-cutting and promotional norms of the coffee industry by commoditizing the industry. focusing on a common set of appeals. offering complementary products. appealing to an emotional benefit. appealing to price-sensitive customers. Answer: d By offering food services at movie theatre complexes so that patrons can get a meal before the show, movie theatre companies are creating value by considering substitute industries. offering complementary services. targeting multiple audience segments. making an emotional connection with audiences. creating partnerships. Answer: b When Arbol Industries' sales professionals adopted the practice of visiting their customers at their place of work, they commoditized their products. better understood their customers’ needs and uncovered opportunities. offered complementary products and services. targeted multiple audience segments. developed a “push” strategy. Answer: b Page: 44 TRUE - FALSE The really smart companies do not merely understand customer needs; they create them. Answer: True Companies can only create customer value if they have an accurate understanding of customer needs. Answer: True Page: 26-27 Primary research is research that has already been conducted by someone else. Answer: False While formal market research is useful, do not discount informal ways to listen to your customers. Answer: True Page: 29 Learning objective: 2-2 Secondary research techniques are also known as exploratory research techniques. Answer: False In ethnographies, the researcher becomes a customer to learn more about customer needs and value drivers. Answer: True Secondary research cannot identify what gaps exist in knowledge or what traps to avoid. Answer: False Focus groups are an inflexible technique. Answer: False Page: 34 A focus group is a great way to explore the dimensions of a problem. Answer: True A data collection method where the moderator engages one respondent in a conversation for at least 60 minutes is referred to as a survey. Answer: False Participant observation is a process where the researcher actively participates with the customer to gain insights that other techniques may not be able to generate. Answer: True Harley Davidson should turn to ethnography when trying to understand the emotional connection to the brand that would cause customers to tattoo the logo on their bodies. Answer: True All questionnaires contain questions about feelings and attitudes, behaviour, and demographic variables. Answer: True Questionnaires are good for counting and summarizing results, but not for generating ideas. Answer: True The problem with using marketing research tools to understand customer needs is that customers may not be able to articulate their needs. Answer: True Firms that take a product-centric approach to marketing tend to co-create value with their customers. Answer: False By letting customers customize their own experience, Build-A-Bear is involving customers in the innovation process. Answer: True Reliable, unbiased research can only come from customers. Answer: False FedEx focused on the needs of different customers when it bought Kinko's, allowing customers to not only print but also to ship their documents. Answer: True Companies like Dyson know that customers need a set of complementary goods and services to complete the experience. Answer: True Winning companies create new markets by focusing on offering the same value as competitors. Answer: False A focus group is a guided discussion with a group of respondents such as customers. Answer: True 23. Common sources of secondary data include the government, educational institutions, and professional associations. Answer: True Primary research is quicker than secondary research. Answer: False Focus groups allow clients to interact directly with customers. Answer: False SHORT ANSWER Using the introduction of the Sony Walkman as an example, explain how Sony didn’t just understand customer needs, but “created” them. Answer: Sony realized that consumers could not imagine their lives with this innovation, so they solved the problem by initially targeting a group of customers who did appreciate a break from a tedious activity–joggers. Sony gave shape to a need the consumer had a hard time articulating. List the advantages of secondary research. Answer: There are several advantages to conducting secondary research: 1. You may find the answer to the question you are researching. 2. It can identify gaps in knowledge and what traps to avoid. 3. It is quicker than primary research and can be free of charge. Name at least three cautions you should heed when conducting secondary research. Answer: 1. The research may be outdated. 2. The research may be biased. 3. The research was conducted with objectives that may not be your research objectives. Explain the advantages of focus groups. Answer: 1. They are a very flexible technique. 2. Clients can see their customers in action (behind one-way mirrors). 3. Focus groups offer a great way to explore the dimension of a problem, generate ideas, test product concepts, and test marketing communications messages. 5. What type of data collection is the depth interview method most appropriate for? Answer: Depth interviews are a great data collection method when you want to know (a) how customers make decisions between competing alternatives and (b) the sources of influences on those decisions. Describe the participation observation technique and provide an example. Answer: Participant observation is a process in which the researcher actively participates with the customer to gain insights. To gain a better understanding of customer needs, DeWalt uses this technique, sending researchers to work alongside professionals who use their tools. What are the three classes of questions that all questionnaires contain? Answer: All questionnaires ask three classes of questions: What do you think (attitudes and feelings)? What do you do (behaviour)? Who are you (demographic variables)? How do companies co-create value with the customer, and which medium is helping to facilitate this? Answer: In essence, companies are getting the customer to do the research for them. Thanks to the internet, consumers are no longer isolated from each other. Instead, like-minded people can form communities using chat rooms, blogs, and social networking tools. This allows smart companies to involve the customer in the innovation process. Using movie theatres as an example, explain why smart companies offer complementary products and services. Answer: Movie theatre companies now think outside their business and realize that to simply watch a movie, their customers need to perform a series of complementary tasks. These days, customers can get a meal before the show at many movie theatre complexes. How did Starbucks decommoditize the coffee industry and broaden its appeal to customers? Answer: Starbucks broke through the price-cutting and promotional tactics of the industry by appealing to an emotional benefit, the café experience. As a result, Starbucks has revolutionized the entire industry and is now broadening its appeal by encouraging customers to take the café experience home.

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