Chapter 4
Marketing Research

Contents

Introduction

Research in the Music Industry

Types of Research

Overarching Research Issues: Validity and Reliability

The Research Process

Choosing a Method

Syndicated Research

Custom Research Firms

Tracking Consumer Behavior on the Web

Conclusion

Glossary

References

Research is formalized curiosity. It is poking and prying with a purpose.

—Zora Neale Hurston

Introduction

Marketing research is the function that links the consumer, customer, and public to the marketer through information—information used to identify and define marketing opportunities and problems; generate, refine, and evaluate marketing actions; monitor marketing performance; and improve understanding of marketing as a process. Marketing research specifies the information required to address these issues, designs the method for collecting information, manages and implements the data collection process, analyzes the results, and communicates the findings and their implications. (American Marketing Association, 2013). Marketing research and market research are not the same thing: market research is a subset of marketing research that looks specifically at the size, location, and makeup of a product market.

Research in the Music Industry

Research is not a major division of any record label. Some of the largest labels have a small staff dedicated to consumer and industry research while others handle research chores ad hoc or hire the task out to an independent research firm. The more sophisticated research departments produce work that can be used to, for example, persuade major corporations of the benefit of teaming up with a particular artist in pursuit of a common consumer. The labels continue to rely mostly on syndicated data collected after a song is released. This is not to say that the labels don’t collect information on an artist before they sign them. They do. But it is often limited to checking with others in the industry, social media numbers, sales numbers (if they are available), attending a few live shows, and then going with their “gut feelings.”

Radio stations perform most of the research in the music industry. They purchase syndicated research as well as measure the appeal of new music through regular online, telephone, or auditorium testing.

Types of Research

Custom verses syndicated: One way to categorize research is by the purpose for which it is collected. Custom research is done to answer a specific question such as “How much are consumers willing to pay for an advertising-free streaming music service?” Since the research is initiated and paid for by a single company or organization, they can customize the research specifically for their needs. Research that is done on an ongoing basis and sold to subscribers in the form of periodic reports is called syndicated research. Examples of syndicated research in the entertainment industry include Arbitron (radio listenership), Nielsen (television viewership), Broadcast Data System’s (BDS) airplay monitoring, and SoundScan’s retail sales monitoring. Because syndicated research has many users and is often used for longitudinal purposes (comparisons over time), the information is standardized and may be more general. The results are published periodically, ranging from daily to quarterly, as a report; however, subscribers may elect to pay for more detailed data or access to “raw” data from which they can create their own reports. For example, if you want to know what the best selling song is for this week you can simply open up Billboard magazine where the results from the SoundScan research will be reported in a simple sales chart form, but if you want to know in which areas of the country the song sold best, you would need to subscribe to SoundScan to get the more detailed information.

Purpose of the research: Research can also be categorized by the kinds of questions the researcher is trying to answer. This is commonly referred to as research design. The three types of research design—exploratory, descriptive, and causal—are discussed below.

Overarching Research Issues: Validity and Reliability

Steps must be taken to assure that the research results are valid and the process is reliable. There are many levels of validity, the scope of which is beyond the purpose of this text, so for our purposes let us define validity as the “truth.” That is we want our measures to reflect true differences among the subjects being measured and not some random error or bias. To do this, it is very important to be sure the researcher asks the right questions, starting with the problem definition and ending with the interview, focus group or survey questions. Subtle differences in the wording of a question can lead to different results: “You don’t really like Bluegrass music, do you?” will get a different response than the less biased, “Do you like Bluegrass music?”

Reliability is the researcher’s ability to get similar results from repeated applications of the measures or from independent but comparable measures of the same trait or construct. If you measure how tall you are using a tape measure under similar conditions (no shoes, stand up straight each time), you expect the difference in measurements to be attributed to changes in the object being measured—you grew! But if your tape measure was printed on stretchy material, you might get different results each time because you have a bad measuring instrument.

There is a clock on the shelf in my office. It reads 10:35. The battery died years ago and I just never replaced it. Is the time on the clock valid? Reliable? Think about your answer before you continue reading. The clock is very reliable. No matter when I look at it I always get the same information—“similar results from repeated applications of the measures.” 10:35. Unfortunately, it is only valid twice a day! For research results to be useful they need to be both valid and reliable.

Unlike height, much of what we want to measure in the music business is not physical or real—you can’t touch or see it. They are latent or abstract constructs such as “engagement,” “identification,” or “emotional response” (Stewart, 2013). These constructs are much harder to accurately measure than sales or spins because they are complex and abstract, making it more difficult to construct valid and reliable measurement instruments.

The Research Process

There are several stages to the research process once a problem is recognized, all of which are equally important and demanding: problem definition, determining the research design, choosing and designing the data collection, actual data collection, data analysis, and communicating the results. Although presented as discrete stages, it is important to understand that this is not a linear process. At any stage of the research process you may have to go back to a previous stage and start over or modify the research due to new information or complications.

Problem definition—The first step is to determine what questions need to be asked. The questions may seem obvious, but the researcher must make sure they are getting to the root of the problem. Let’s say that an artist or label manager has come to you and wants to know why the artist’s last album didn’t sell as well as the one before. The obvious answer is because not as many people bought copies of the album, but the real question is why? The end goal of the problem definition stage of the research process is to determine the objective of the research. What is it that you want to learn by doing the research?

The second step in the research process is determining the research design. You could look at the three research designs, exploratory, descriptive and causal, as a continuum. The less you know about the problem, the greater your need for basic information, the more likely you are to use an exploratory research design. Alternatively, the more you know already, the greater the probability that a descriptive or causal research design will be appropriate.

In some situations you may not be sure exactly what the problem is or what questions you should be asking. In that case, an exploratory research design may be helpful in clarifying and defining the research objectives. Exploratory research may be done to help better understand the situation, screen alternatives or discover new ideas and results in qualitative data. “The focus of qualitative research is not on numbers but on stories, visual portrayals, meaningful characterizations, interpretations, and other expressive descriptions” (Zikmund and Babin 2007, p. 84).

The primary methods for exploratory research are focus groups and depth interviews, discussed below.

Descriptive research is done to describe the existing characteristics of a defined target market or population (Hair, Bush, and Ortinau, 2003). The primary tool of descriptive research is the survey because of its flexibility, speed, and costs. As mentioned before, the key to a good survey is asking the right questions. Because the survey may be administered without the researcher present (via email or online, for example) clear, concise questions are essential. Finally, causal designs are rigidly specified experiments designed to determine cause and effect and are rarely used in the marketing side of the entertainment business.

Data Collection Methods: Once you have an understanding of what you want to know (problem definition), you should research what has already been learned on the topic and what information is already available. The answer to your question may already exist thanks to prior research, which will negate the need for further, more difficult, and expensive research. Whenever you use somebody else’s research to answer a question you are doing secondary research. Even if the answer isn’t already out there, examining existing research will help you avoid repeating the same mistakes and may give you valuable insight into the problem you are investigating. It may also help you determine which research design will give you the best answers to your questions.

If you don’t find the answer to your question in the existing research then you will have to conduct additional research. The primary methods used to collect data in the music business are focus groups and surveys. A popular choice for exploratory research, the focus group is a face-to-face interview of six to ten people that allows the researcher to delve deeply into participants’ responses by asking follow-up questions. Focus groups may appear to be unstructured and free-flowing, but the well-planned interview is designed to discover new information while maintaining the flexibility to pursue interesting answers and topics as they arise. Focus groups are good for testing new music and finding out why consumers like or dislike certain songs, but because they involve a small number of people they are not good for generalizing results or providing statistical data about the market. In other words, you should not make marketing decisions based on a single focus group (although it is often done!). Automakers also use focus groups to get feedback on design changes and new model features, but they conduct dozens of focus groups before drawing any conclusions from them. Depth interviews are similar in structure to focus groups but are done on a one-on-one basis.

Research panels: A research panel is like an on-going focus group except in most cases the panel does not meet face to face. Data is collected from the same participants on an ongoing basis, either via mailed surveys, online, or perhaps passively by an app on a phone. Panels may be asked to provide more detailed data than can be asked in a one time survey, or they may be asked to provide data over a long period of time for a longitudinal study. Nielsen Mobile collects data on music and entertainment exposure using a mobile phone app that collects information from the same group of participants on an ongoing basis for as long as they choose to remain a member of the panel. Panel members are recruited to fit the profile desired by the researcher and if a member of the panel drops out for some reason, they can be quickly and easily replaced.

Survey research may be used to further test information gathered from focus groups or as a stand-alone research tool. Survey research is deceptively difficult. How hard can it be to ask somebody a few questions? The challenge comes in not only asking the right questions, but asking them the right way to the right people.

It is tempting to take short cuts and ask questions like, “On a seven point scale, please indicate how much you like the music and lyrics of this song?” But how do you answer the question if you love the lyrics but hate the melody? Other problems might not be so obvious. A researcher might focus on the artist’s music as the cause of declining sales when the actual cause may come from their appearance or their behavior. This problem could have been solved by good exploratory research and asking the right questions in a focus group. It is also important to make sure you are asking your questions to the right people, the artist’s potential audience (target market).

Online Survey Tools

Several companies offer free survey tools with limited capabilities to entice users to buy the full packages. These free versions may be all you need for a short survey with a small sample size. Some of these tools are linked to or packaged with email services like Mail Chimp or MyEmma to make questionnaire distribution easier. Free survey tools include:

Survey Monkey www.surveymonkey.com (MyEmma)
Survey Gizmo www.surveygizmo.com (Mail Chimp)

Choosing a Method

Experiments require that all the variables, the factors that might influence the outcome of the experiment, be controlled. This is a monumental task under the best of conditions. Sometimes variables we didn’t even know existed are later discovered to influence the outcomes. Nobody in the music business wants to do experiments with their artists because to control and manipulate the variables (so that you can see the consequences) means some part of the target market isn’t going to get the full marketing exposure. If we withhold advertising here (but not everywhere else) or we use in-store promotions in one region but not the others, we may hurt sales in those areas, and nobody wants to do that. It is difficult enough to get record company executives to do any kind of research without the threat of decreased sales. Labels and managers are sometimes willing to do other kinds of research, primarily focus groups and surveys. So when should each be used?

When focus groups are appropriate: Focus groups are considered exploratory research but can be conducted either before or in conjunction with a survey, or any time the company wants to probe an issue more in depth. Focus groups are often conducted in advance of a survey in order to gain a better understanding of the issues or of the target market for the survey, allowing the researcher to better understand the context, vernacular, and how survey questions might be worded better. Care must be taken to make sure that the participants in the focus group are representative of the same target market that will participate in the survey. You would not want to conduct a focus group of eight- to sixteen-year-old girls on the subject of their favorite artists and then give the follow-up survey only to adults 25 and older. In short, the focus group should be used to inform the survey research.

Other times a focus group will be conducted without any follow-up survey or after a survey in order to probe deeply into a few research questions or to get consumer feedback to aid in decision making. Management may have been surprised by the results of the survey research and want to find out why consumers answered the way they did. Although it is unlikely they can go back to the exact same people that responded to the survey, they will be able to go back to the same target market, the same sampling frame, and draw a representative focus group that should be able to shed light on the answers given in the survey.

Let us caution you once again that a single focus group should not be used to make decisions. The ideal procedure would be to conduct multiple focus groups until no new information was gained, but this isn’t the ideal world and decisions are often made based on the feedback from a single focus group.

When surveys are appropriate: Surveys are best suited to situations where the research questions can be answered in a straightforward manner, when more information about aggregate consumer groups is needed, and when that information will need to be generalized to a larger population. Surveys are good for identifying characteristics of target markets, describing consumer purchasing behaviors, and measuring consumer attitudes. Surveys provide a relatively inexpensive, efficient, and accurate means of evaluating information about a market by using a small sample and extrapolating the result to the total population or market.

That said, writing a good survey question can be very difficult. All the ambiguity must be removed because you probably won’t get a chance to explain what you are trying to ask. Because of this, entire textbooks have been written just on survey design. Whenever possible the researcher should use existing scales to measure abstract concepts such as attitude and personality, because these scales will have been validated by previous research. Complete, validated and reliable scales are published in journals and books like The Handbook of Marketing Scales. If a valid and reliable scale is used and an appropriate sampling procedure is followed, your survey results should convey, with a high degree of confidence, opinions and characteristics that the entire market or population exhibit.

Simple surveys are conducted on a routine basis in the form of warranty registrations, bounce back, or customer response cards. The record labels once placed survey cards inside CD packaging and incentivized buyers to respond by entering them into a contest for a t-shirt or something autographed by the artist, but as the industry has contracted and shifted toward digital sales this data collection method has disappeared. It should be a mortal sin if the label doesn’t at least get the buyer’s email address, but additional questions can be asked that can be analyzed on many levels, including by artist and geographic area. Because these cards were small only a very few questions could be asked, but an online version can go in greater depth. But be careful about overgeneralizing the responses. This is not a random sample and research indicates that there are real differences between the people who send back the cards and those who don’t. Still, the responses are beneficial in gaining an understanding of the market.

Data collection: Hair et al. (2003) defined data as “facts relating to any issue or subject.” Data is the answers we get by conducting experiments, focus groups, and surveys. Once the research design (experiment, descriptive, or qualitative) has been determined and the method (focus group or survey) has been chosen, the next step is to figure out the sampling frame and sample size. You would get the best information if you asked everyone in the target population your questions, but a census is not practical or realistic. Instead, we seek to take a representative sample of the population that will allow us to draw accurate conclusions. Keep in mind that we are not talking about the entire population of the U.S. or the world. We are likely only to be interested in potential buyers of our artists’ music or tickets and that market is a subset of the bigger population. So our sampling frame would be all potential buyers of a music genre or some other target market. From that sampling frame we would draw a sample, a subset, of people to actually take our survey or be in our focus groups. The exact size of sample can be calculated depending on the desired precision and confidence, but that is beyond the scope of this text. Suffice it to say that a research company testing songs for a radio station can calculate the sample size needed to give the programmer statistically precise information with great confidence, provided they get the right people to participate in the research and that is, arguably, more important than the size of the sample. You don’t want to ask a group of 60-somethings their opinion on DubStep—they aren’t likely to be the right audience.

Surveys can be administered online if the questions are straightforward and the population you want to sample is small or widespread. Surveys can also be administered in person. If you have the permission of the promoter, surveyors may “intercept” concertgoers entering or leaving the venue. Not exactly a simple random sample, but if you are interested in capturing the opinions of the artist’s fans, this is a quick way to reach a lot of them at one time. Surveys may also be included as part of one on one, depth interviews. Depth interviews, like focus groups, allow the researcher to dig more deeply into a topic, but they are done with individuals rather than small groups.

Data analysis: Once the data is collected it must be put into useful form. The first stage of data analysis is to edit and code the data. Editing is the process of checking the data forms for errors, omissions, and consistency. The data is then coded. Coding refers to the systematic process of interpreting, categorizing, recoding, and transferring the data to the data processing program. Much of the process of editing and coding has been simplified through the use of computers. Online surveys minimize the possibility of coding errors because the human element can be minimized.

When the answers to the questions can be represented by numbers (i.e., for question five the respondent chose answer two and for question six they chose answer seven) powerful statistical programs like SAS and SPSS can be used to look for relationships among the answers or commonalities within the respondents.

Not all data can be reduced to a series of numbers to be put into a computer program for analysis. Focus groups and depth interviews may result in long transcripts that will need to be carefully read and analyzed to identify key results and trends. More and more, even this kind of data can be analyzed using specialized software.

Analysis of the data is not the final step. The results of the analysis must be interpreted and given meaning and that information must be communicated to the decision makers in the form of conclusions and recommendations. This is normally done in a formal research report, although in the music business the report or presentation may be less formal than in other industries. The purpose of the report is to communicate the results, findings, and recommendations to the marketing client. The written report should begin with a one or two page executive summary that covers how the research was conducted and the highlights of the findings. The purpose of the executive summary is to give a quick but thorough overview of the research report for a busy executive who does not have time to read the full report. The full report should address each question asked in the research and how the findings are different than expected or otherwise interesting. In the conclusions of the report the researcher should explain what was found and their interpretation of the meaning of the responses. Finally, recommendations should be made based on the results of the research.

Online vs. in person: One of the advantages of doing surveys on computers is that it reduces error during data collection and coding. There are other advantages and disadvantages to computer-based and online research. Smartsurvey.co.uk gives the following ten advantages to online surveys over paper and pencil (P&P) surveys:

Faster: The time it takes to complete an online survey is one-third of the time it takes to complete a paper and pencil survey. Turn around time is shortened making the data and analysis more timely.

Cheaper: Online surveys can cut your costs in half. Fewer administrators to train, no printing costs, no travel or telephone costs (the researcher can take a global sample from the comfort of their office) and the responses are collected automatically and are immediately accessible.

More accurate: As we stated before, there is less error because “participants enter their responses directly into the system.”

Quick to analyze: Because the responses go directly into a database and less time is needed to fix errors, analysis can begin sooner.

Easy to use for participants: Ninety percent of people who have access to the Internet prefer to answer surveys online instead of using the telephone. With an online survey, participants can pick a time that suits them best, and the time needed to complete the survey is much shorter. Questions that are not relevant to a particular participant can be skipped automatically (this assumes, of course, that the respondent has easy access to a computer).

Easy to use for researchers: Since the answers are already in the database, the researcher can quickly pull the data into a statistical analysis software for more detailed analysis. Charts and graphs can be easily generated for visual presentation.

Easy to style: If desired, the survey can be branded to match the company doing the research. Graphics and fonts can be easily changed and audio and video can be easily included in the survey.

More honest: Market researchers have found that participants in online surveys usually provide longer and more detailed answers. Because participants feel safe in the anonymous environment of the Internet, they are more likely to open up and give a more truthful response.

More selective: A more thorough screening can be done and only relevant questions can be asked of each respondent thanks to preprogramming of the survey software.

More flexible: One issue with long surveys is participant fatigue. By the end of the survey respondents just want to be done and may not think about their responses as much, or even just tick off answers just to be done. Online surveys allow the researcher to randomize the order of questions thus avoiding the possibility that the questions at the end of the survey are never seriously considered (www.smartsurvey.com).

Disadvantages of Online Surveys:

Sample quality: Have you heard the term “the digital divide”? It refers to the difference between those who have access to the Internet and those that do not. This is something that must be considered in any online survey. If your target market is suburban, middle-class Caucasian teenagers, then you are probably safe doing an online survey. However, if your target market is inner-city youth, you may want to reconsider using online surveys because they may not have the same level of access to computers and the Internet.

Clarity and follow-up: Online surveys don’t allow for direct interaction between the researcher and the respondent, so there is no second chance to explain what you are asking or to encourage respondents to stick it out to the end. This makes pretesting the survey for clarity and length even more important.

Perception and response rate: Email solicitation of respondents will probably be treated as junk mail and ignored unless there is a third-party endorsement. Getting a known entity, like a well-respected university, a popular blogger, or a celebrity, to endorse the survey will help increase the response rate—the percentage of people invited to participate who actually complete the survey.

Technical issues: While problems can arise in any type of survey, the more technology involved the bigger the problem may be. A respondent may lose power or Internet access during the survey and be unable to finish. The researcher will not know this and may think they just quit halfway through unless they are willing to spend the time and money to create a survey that will allow respondents to return to the survey at the same point where they were interrupted. If the proper precautions are not taken, the same person may take the survey repeatedly, thus skewing the responses. Finally, the survey itself must be tested and retested to make sure that every possible combination of responses is glitch free.

Sources: http://www.utexas.edu/learn/surveys/disadvantages.html and http://shlee.myweb.uga.edu/onlinesurvey/valueofonlinesurveys.pdf. Web. August 8, 2013.

Online Survey Services

Syndicated Research

The buzzword in research circles and business today is “big data.” Big data has been defined as “a collection of data from traditional and digital sources inside and outside [the] company that represents a source of ongoing discovery and analysis” (Arthur, 2013). New companies like Next Big Sound and BuzzAngle specialize in making the mountains of data, especially Internet data, manageable for the music business industry. They will be discussed in depth in the Technology and the Music Business chapter. Both these companies are collecting detailed information ranging from CD sales to artist mentions on Facebook and Twitter, to contribute to charts, and for analysis by their subscribers. What sets them apart from previous information providers in the entertainment industry is the breadth of data and the user’s ability to drill deep into the details of the data.

Nielsen SoundScan is arguably the most important company providing research data and information to record labels. They are self-described as “an information system that tracks sales of music and music video products throughout the United States and Canada. Sales data from point-of-sale cash registers is collected weekly from over 14,000 retail, mass-merchant and nontraditional (online stores, venues, etc.) outlets.” Weekly data from sales are compiled by SoundScan and made available every Wednesday. “Nielsen SoundScan is the sales source for the Billboard music charts” (SoundScan, 2005).

Since the introduction of SoundScan and BDS, the use of syndicated research has become a valuable tool for making marketing decisions in the record business. Chapter 16 illustrates how SoundScan data can be used as a basis for more in-depth research to detect sales trends and the impact of marketing strategies. Data from BDS can be merged with SoundScan to determine a more precise impact of radio airplay on record sales than was possible before. The use of SoundScan, and primary research such as the business reply cards, syndicated research from other sources, and occasional focus groups, are combined for predicting marketplace performance of new releases, tour analyses, target market definition, and to persuade radio stations to increase airplay.

Nielsen also owns Broadcast Data Systems (BDS). BDS provides airplay tracking for the entertainment industry using a digital pattern recognition technology. Nielsen BDS captures in excess of 100 million song detections annually on more than 1,600 radio stations, satellite radio, and cable music channels in over 140 markets in the U.S. (BDS, 2009). More information on BDS is available in the chapter on radio.

MediaBase is another company that tracks radio airplay (see chapter 8). A division of iHeartMedia, Inc., MediaBase 24/7 monitors and provides research to nearly 1,700 affiliate radio stations in the U.S. and Canada on a barter subscription basis. The data collected from radio stations is used not only by record labels and radio stations, but to compile airplay charts reported in U.S. Today and countdown shows such as American Top 40 with Ryan Seacrest and CMT Country Countdown USA with Lon Helton. In addition to their subscription-based radio service, MediaBase offers a consumer-oriented service called MediaBase Music. Music fans are invited to rate popular songs on their site www.ratethemusic.com (http://www.mediabasemusic.com/). Radio programmers use the information gathered to aid in deciding what songs to play on their stations and how often.

Arbitron, Inc. provides information on radio listening audiences, and much of that information is valuable to the record business. Arbitron not only determines how many listeners each radio station has, they also break down the audience demographically. This information is useful not only to record labels trying to work a new single to the radio audience but to advertisers trying to reach the same target audiences.

Others

Trade Association Research

All the major trade organizations provide research for their members. The Music Business Association (formerly the National Association of Recording Merchandisers or NARM) publishes its monthly Research Briefs, where they give the results of studies they have commissioned. Music Business Association provides research findings at its annual convention on a variety of current and ever-changing industry topics. The Recording Industry Association of America (RIAA) provides annual data on shipments, and contracts with an outside research firm to conduct its annual consumer profile. The International Federation of Phonographic Industries (IFPI) collects data from member countries and publishes an annual report called The Recording Industry in Numbers. The IFPI also releases periodic reports on digital music and global piracy. The associations tend to conduct issue-oriented research of benefit to all members of the record industry.

Billboard publishes MarketWatch in its weekly magazine. Market Watch provides a weekly synopsis of record sales both for the previous week and year-to-date sales, and compares this with sales figures from one year earlier. Generally, the reports are provided to dues paying members of the trade organizations or sold to anyone willing to pay the substantial fee for them.

Custom Research Firms

Custom research firms collect and provide data and analyses to answer a specific question for a client. These research firms may specialize in a specific area, such as Internet consumers, and several cover the recording industry and technology. These same companies are also contracted by the various industry associations to conduct specialized research that is then made available to association members.

Forrester Research is one of the major market research firms focused on the Internet and technology; the company conducts research for the recording industry on all aspects of music and the Internet. Forrester also offers custom research and consulting services to its clients. Jupitermedia Corporation is a top provider of original information, images, research, and events for information technology, business, and creative professionals. The associations often hire Jupitermedia to conduct and report on online music consumers. Edison Media Research is a leader in political, radio, and music industry research with clients that include major labels and broadcast groups. Music Forecasting does custom research projects on artist imaging and positioning.

The NPD Group, recently acquired by Ipsos, provides marketing research services through a combination of point-of-sales data and information derived from a consumer panel. NPD’s research covers music, movies, software, technologies, video games, and many other product groups. ComScore offers consulting and research services to clients in the entertainment and technology industries and conducts audience measurements on web site usage through its Media Metrix division. Taylor Nelson Sofres, a UK firm, provides both syndicated and custom research of media usage and consumer behavior. Based in France, IPSOS is a global group of researchers providing survey-based research on consumer behavior. BigChampagne (owned by Clear Channel) tracks online P2P usage and reports, among other things, the most popular songs on P2P networks.

Tracking Consumer Behavior on the Web

Before the emergence of the Internet, marketing researchers used a variety of techniques to learn more about consumer behavior. Many of these studies were not comprehensive; shopping behavior may have been measured on one group of consumers while advertising exposure was measured on another. It is difficult to conduct a comprehensive measurement program without being intrusive and the act of collecting the data may actually have an effect on the subjects’ behavior. One company attempted to measure media consumption and consumer purchases in the same household. Participants had to subject themselves to extensive monitoring and extraordinary procedures to collect the data. In some ways, that made them unlike the general marketplace to which the results would be generalized. So the measuring had a tendency to get in the way of the natural consumer behavior. With the Internet, data collection is more transparent—Web users are not really aware that their movements through the Web are being recorded and analyzed. Of course, this is not a complete picture of their consumption behavior, either.

An important aspect of gathering information on your consumer base involves monitoring the traffic to your site. Web traffic refers to the number of visitors to your web site and the number of pages visited. Oftentimes, it is measured to analyze the importance of its individual pages and elements. By including a bit of programming code on each page of the web-site, the webmaster can learn a lot about the visitors to the site. This helps the webmaster and other marketing professionals understand what product information and which products are considered valuable to its visitors and which are not.

Marketers can also determine whether or not the email they sent you was opened by embedding code in it that sends a request to their server (thus signaling that the email was in fact opened). This method can be used to test different email campaigns or messages for effectiveness.

Quantcast

Quantcast, a targeted online advertising company, provides information on Web traffic combined with demographic data to present a clear depiction of a website’s visitors. The service combines sample-based information and analytics of web behavior to present a profile of a website’s traffic, including information on: age, gender, ethnicity, income, education, repeat vs. casual traffic, monthly traffic volume, and a comparison of other sites that your visitors frequent, like, and search for. Analytics and “big data” are discussed further in chapter 16.

In the lifestyle analysis, Quantcast analyzes what other sites your fans visit when they are not on your site. This helps develop a profile of what else your visitors are interested in when they are not on your site. For example, visitors to Kelly Clarkson’s website also visit bravadousa.com and AmericanIdol.com.

Figure 4.1 Quantcast Information (courtesy of Quantcast)

Figure 4.1 Quantcast Information (courtesy of Quantcast)

Figure 4.2 Lifestyle Information for Visitors to Kelly Clarkson’s Website. (courtesy of Quantcast)

Figure 4.2 Lifestyle Information for Visitors to Kelly Clarkson’s Website. (courtesy of Quantcast)

Conclusion

Quality research is deceptively difficult and requires careful planning. Different research designs are used depending on the research question to be answered and the depth of information desired. Most of the data collected in the music business is for syndicated reports such as Nielsen reports and Billboard charts. The Internet has allowed researchers to more easily reach respondents, reduce costs and time needed to complete the research process. The Internet has also introduced new competitors and new measures into the research process, as will be seen in chapter 16.

Glossary

Big data—A collection of data from traditional and digital sources inside and outside [the] company that represents a source of ongoing discovery and analysis (Arthur 2013).

Coding—The systematic process of interpreting, categorizing, recoding, and transferring the data to the data processing program.

Construct—A theory or concept representing ideas that cannot be measured directly.

Causal design—A research design in which the major emphasis is on determining a cause-and-effect relationship (AMA online dictionary).

Custom research—Research undertaken to answer a specific question.

Descriptive research—Research undertaken to describe the existing characteristics of a defined target market or population (Hair, Bush, and Ortinau. 2003).

Depth interview—A one-on-one, face-to-face interview done out of the researcher’s office that allows the research to probe deeper into the respondent’s answers by asking follow-up questions.

Editing—The process of checking the data forms for errors, omissions, and consistency before coding.

Exploratory research—A research design focused on better understanding a situation, screening alternatives, or discovering new ideas thereby clarifying and defining the future research objectives.

Focus group—A face-to-face, interactive interview of a small group of people that allows the researcher to delve deeply into participants’ responses by asking follow-up questions.

Market research—A subset of marketing research that looks specifically at the size, location, and makeup of a product market.

Marketing research—The function that links the consumer, customer, and public to the marketer through information—information used to identify and define marketing opportunities and problems; generate, refine, and evaluate marketing actions; monitor marketing performance; and improve understanding of marketing as a process. Marketing research specifies the information required to address these issues, designs the method for collecting information, manages and implements the data collection process, analyzes the results, and communicates the findings and their implications (American Marketing Association, 2013).

Problem definition—Stating what problem is to be solved and what questions need to be asked to obtain the information needed to determine the solution to the problem.

Qualitative research—Research used to gain an understanding of how underlying attitudes, opinions, and motivations impact consumer behaviors.

Reliability—The researcher’s ability to get similar results from repeated applications of the measures or from independent but comparable measures of the same trait or construct.

Research design—A plan that guides the collection and analysis of research data.

Research panels—A group of people put together by a researcher from which data is collected on an ongoing basis.

Secondary research—Using existing research data in an attempt to answer your own research question.

Survey research—A research design that collects data using identical questionnaires administered either in person or electronically.

Syndicated research—The information collected on a regular basis that is then sold to interested clients (American Marketing Association Online Dictionary).

Validity—The extent to which differences in results in the measurements reflect true differences among the objects or characteristics being measured rather than constant or random errors.

References

American Marketing Association. http://www.marketingpower.com/aboutama/pages/definitionofmarketing.aspx. Web. June 25, 2013.

Arthur, L. “What Is Big Data?” Forbes, August 15, 2013. Web. November 10 2014.

BDS. www.bdsonline.com/about.html. 2009.

Hair, J., Bush, R., and Ortinau, D. Marketing Research Within a Changing Information Environment (2nd edition). Boston: McGraw-Hill. 2003.

Smartsurvey.com. http://www.smartsurvey.co.uk/articles/10-advantages-of-online-surveys/#.UgPpeVPpaww. Web. August 9, 2013.

SoundScan. www.soundscan.com/about.html. 2005.

Stewart, S. M. “Artist-Fan Engagement Model: Implications for Music Consumption and the Music Industry,” (Doctoral dissertation). 2013. Retrieved from ProQuest Dissertations & Theses database. (UMI No. 3612137).

Zikmund, W. G., and Babin, B. J. Essentials of Marketing Research. 3rd ed. Mason, OH: South-Western. 2007.

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