Marketing Research Case Study

The market for women’s hair shampoos has become highly specialized and segmented. In recent years a large number of special purpose shampoos have appeared on the market, each promising to provide various hair care benefits to the potential user. The Syd Company is diversified manufacturer of consumer packaged goods. At this time the firm has no women’s shampoo in its product line.

The company’s marketing research personnel met recently with a small research firm, FC Associates, and discussed the possibility of study of young female adults living in Bombay.

The Syd company had established—through a series of recently completed interviews with a small group of women consumers—that “body” (apparently connoting hair thickness or fullness) in a hair shampoo was frequently mentioned as a desired characteristic. Armed with this rather sketchy information concerning the desirability of “body” in a shampoo, the firm’s laboratory personnel had set to work on developing some prototypical compounds that appeared potentially capable of delivering this characteristic to a greater extent than brands currently in the market.

During the initial conversation between Syd and FC Associates, the following managerial problems came to the light:

1. Assuming that laboratory personnel could produce a women’s shampoo with superior “body”, is the market for this product large enough to justify its commercialization? 2. What benefits in addition to “body” should be incorporated into the new shampoo? 3. What are the characteristics—product usage, hair type, demographics—of people who are particularly attracted to a shampoo with “body”? (Knowledge of these characteristics would be desirable in defining the target segment for the new product.) 4. How would the concept of “body” in shampoo be communicated; what does the consumer mean by “body’ in shampoo? ( Knowledge of the connotations of “body” would be valuable in design of promotional messages and point of purchase materials.)

Since Syd had no entry in the shampoo market, the company had little to go on in the way of secondary sources of information. While various market statistics could be obtained for the existing brands, the firm was primarily interested in characteristics appropriate for a relatively new concept in the market place—a shampoo that emphasized “body”.

PROBLEM STRUCTURING

Although formal statistical decision analysis was not applied in this case, it became apparent that the firm faced three primary courses of action:

1. Continue the technical development of a new shampoo that delivers the consumer benefit: “body”. 2. Terminate technical development related to this characteristic and switch efforts to some other shampoo benefit. 3. Discontinue all the efforts in women’s shampoo products.

Continuation of technical development on “body”, in turn, is based on two considerations:

1. that new product can be developed successfully from a technical standpoint 2. And that the new product can be sold in sufficient quantities to justify future development outlays, start-up expense, ongoing production and marketing costs, plus earning an appropriate return on invested funds.

Informal analysis indicated a high probability of technical success during the ensuing 12 months with relatively modest additional outlays in technical resources. The major problem appeared to be one of market potential—more specifically, whether a target segment of sufficient size was available to warrant technical development and eventual commercialization.

COST AND VALUE OF MARKETING RESEARCH

Current uncertainties about the potential demand for the new product suggested the desirability of conducting marketing research beyond the preliminary consumer group interviews that had been recently conducted by the firm. Crude estimates of the cost versus value of additional information (including such aspects as the costs of continuing technical development and start-up, the probability of technical and marketing ‘success”, and likelihood that survey results would correctly identify the appropriate state of nature) clearly indicated the advisability of further marketing research. The problem was not whether marketing research could be justified—the quickest and crudest estimates demonstrated its potential value—but rather, what kind of research should be done that seemed more likely to answer management’s questions. Indeed the main purpose of marketing personnel’s visit to FC Associates was to discuss an exploratory study that could be helpful in designing the main study that would eventually be conducted on national basis, probability based sample. What should be the main study cover? How could management’s questions be translated into a research design? What additional questions should be raised?

Agreement was reached that FC would do the exploratory study.

RESEARCH DESIGN

Given the exploratory character of the research, question of adequate sample size and representative ness were not of primary importance. What was germane to the pilot research was the need for FC to translate management’s question into operational terms and, in the process, to develop additional questions of relevance to the design of the main piece of the research that would be undertaken after the pilot results were analyzed.

The principal focus of the exploratory research was to be on shampoobenefits. In the course of conducting preliminary consumer group  interviews the client’s marketing research personnel had assembled a list of approximately 30 benefits that either had been advertised or were thought by at least some consumers to be relevant in the choice of a hair shampoo. Not surprisingly, many of the benefit description were redundant; hence, the first step was to trim down the list to a smaller set. The table 1 shows the 16 benefits that emerged from the culling process. The preliminary research seemed to indicate that the first 10 benefits were probably the most important of the 16. TABLE: 1

THE LIST OF HAIR SHAMPOO BENEFITS USED IN QUESTIONNAIRE

1. Hair stay clean a long time
2. Hair stays free of dandruff or flaking
3. Hair that looks feels natural
4. Hair that has a body
5. Manageable hair that goes where you want it
6. Hair with sheen or luster
7. Hair with no split ends
8. Hair with enough protein
9. Hair that doesn’t get oily fast
10. Hair that’s not too dry
11. Hair with fullness
12. Hair that’s not frizzy
13. Hair that holds a set
14. Hair with a texture
15. Hair that’s easy to comb when it dries
16. Hair that looks free and casual

Indeed the preliminary research suggested that the first six benefits probably constituted the “CORE SET”— i.e., those benefits of really primary importance to consumer choice.

A second matter of importance concerned the nature of respondents to be interviewed. The study’s sponsor suggested a purposive sample of young female adults—aged 18 through 30— with an approximate 60-40 split between married and single. Only the consumers who shampooed their hair at least twice a month, on the average, were to be interviewed. In brief, the sample was to be aimed at a specific age group of relatively active users of shampoo.

KEY RESEARCH QUESTIONS

Given the emphasis placed on product benefit preferences, particularly the benefit of “body”, a number of ancillary research questions were developed from the preliminary ones indicated by the client:

1. How do consumers of hair shampoo perceive various benefits as commonly (or rarely) available in shampoos currently on the market? 2. Given the freedom to make up her own ”ideal” shampoo, what “bundles” of benefits do consumers want? Specifically, how often is “body” included in their ideal benefit bundles? 3. Assuming that a consumer desired and could get a shampoo that delivered “body,” what other benefits are also desired in the same brand? 4. What is conjured up by the phrase “shampoo body” and its various connotations—that is, what words are elicited on a free association basis? 5. How do preferences for “body” in the shampoo relate to a. Frequency of hair shampooing (i.e., heavy vs. light users of shampoos)? b. Perception of its availability in current shampoos? c. Preference to other benefits in addition to “body’? d. Hair physiology and wearing style?

e.Demographics (i.e., age, marital status, education etc.)?

These questions set the stage for FC Associates to develop the questionnaire.

ADMINISTRATION

The questionnaire was first pre-tested. Following this, the questionnaire was administered on a personal, in-the-home basis by the interviewers. The respondents were drawn from the city on a purposive basis. Interview time averaged about half an hour; all data were collected over a span of one week.

Assume that you are the R&D manager for the SYD Company:

a. How would you criticize the study in terms of its usefulness to you? b. If you had the opportunity to design the pilot project from your viewpoint, what questions would you like to include in the questionnaire?