CASE 8-1 Mountain Bell Telephone Company Jim Martin, marketing research manager for Mountain Bell, studied the final research design for the hospital administrator study that had been prepared by Industrial Surveys, a marketing research firm in Denver. He realized that he needed to formulate some recommendations with respect to some very specific questions. Should individual personal interviewers be used as suggested by Industrial Surveys, or should a series of one to six focus-group interviews be used instead? Was the questionnaire satisfactory?Should individual questions be added, deleted, or modified? Should the flow be changed? Exactly who should be sampled, and what should the sample size be? Research Setting About 20 field salespeople at Mountain Bell Telephone Company were involved in sales of communication equipment and services to the health-care industry.
Because of Job rotations and reorganizations, few salespeople had been in their present positions for more than three years. They were expected to determine customer needs and problems and to design responsive communication systems.In addition, there was a health-care industry manager, Andy Smyth, who had overall responsibility for the healthcare industry marketing effort at Mountain Bell, although none of the sales personnel reported directly to him. He prepared a marketing action plan and worked to see that it was implemented. The marketing action plan covered Sales objective by product and by segment Sales training programs Development of sales support materials and information Andy Smyth was appointed only recently to his current position, although he had worked in the healthcare market for several years while with the Eastern Bell Telephone Company.
Thus, he did have some firsthand knowledge of customer concerns. Further, there was an AT&T marketing plan for the lath-care industry which included an industry profile; however, it lacked the detailed information needed, especially at the local level. It also lacked current information as to competitive products and strategies.
Mountain Bell had long been a quasi-monopoly, but during the past decade had seen vigorous aggressive competitors appear. Andy Smyth thought it imperative to learn exactly what competitive products basis of their competitive appeal.He also felt the need for some objective in-depth information as to how major Mountain Bell customers in the health-care industry perceived the company’s product line and its ales force. He hypothesized that the sales force was generally weak in terms of understanding customers’ communication needs and problems. He felt that such information would be particularly helpful in understanding customers’ concerns and in developing an effective sales training program.
He hoped that the end result would be to make the sales force more customer oriented and to increase revenues from the health-care market.While at Eastern Bell, Andy Smyth had initiated a mail survey of hospital administrators that had been of some value. Several months before, he had approached Jim Martin with the idea of doing something similar at Mountain. Jims reaction was that the questionnaire previously used was too general (that is one question was: What basic issues confront the health-care area? ) or too difficult to answer (How much do you budget monthly for telecommunications equipment or service? 0-$1,000; $1 etc.
) Further, he felt that indents individual interviews would be more fruitful.Thus, he contacted Industrial Surveys, which, after considerable discussion with both Jim and Andy, created the research design. They were guided by the following research objectives: 1 . What are the awareness and usage levels of competitive telecommunications products by the hospital? 2. What is the perception of Mountain Bell’s sales force capabilities as compared to other telecommunications vendors? 3. What is the decision-making process as it pertains to the identification, selection, and purchase of telecommunications equipment? 4.
What concerns/problems impact most directly upon the hospital’s (department’s) daily operations? . What are the perceived deficiencies and suggestions for improvement of work/information flow? Research Design Research interviews will be conducted in seven Denver area hospitals with the hospital administrator and, where possible, with the financial officer and the telecommunications manager. A total of 14 interviews are planned. Interviews will be held by appointment, and each respondent will be probed relative to those overall objectives.
The cost will be from $6,500 to $8,500, depending on the time involved to complete the interviews. The questionnaire to be used follows.D. A. Awareness and Usage of Competitive Telecommunications Equipment 1 .
What departments presently use non-Bell voice communications equipment (paging, intercom, message recording, etc. )? What were the main considerations in selecting this equipment? 2. What departments use non-Bell data terminals (Crust)? What are the major functions/activities that this equipment is used for? What were the main considerations in selecting this equipment? 3. How do you view the capabilities of Bell System voice-communications equipment to meet your operations needs? 4.How do you view the capabilities of Bell System data terminals to meet your records- and information-retrieval needs? 5. What do you feel are Mountain Bell’s main strengths and/or weaknesses in meeting your hospital’s overall telecommunications needs? B. Perceptions of the Mountain Bell Sales Force 1 .
What should a telecommunications specialist know about the hospital industry in order to adequately address your voice- communications and data-processing needs? 2. Have you ever worked with any Mountain Bell marketing people in terms of your communications needs?If so, how knowledgeable do you perceive the Mountain Bell sales force to be with respect to both the health-care industry and their telecommunications equipment? How do they compare to non-Bell vendors of such products? C. Purchasing Decision 1 . What is the standard procedure for selecting and authorizing a telecommunications purchase? Is this based primarily on the dollar amount involved or type of technology? 2. Who has the greatest input on the telecommunications decision (department manager, administrator, physicians, and so on)? 3.What are the most important considerations in evaluating a potential telecommunications purchase (equipment price, cost-savings potential, available budget, and so on)? 4. What supplier information is most important in facilitating the purchasing decision? How effect- G. Dive has the Mountain Bell sales force been in providing such information? Specification of the Most Important Problems or Concerns Relating to Effective Hospital Management 1 .
What are the most important problems or concerns confronting you in managing the hospital? 2. What type of management data is required in order to deal effectively with these problems or concerns? . How are these data presently recorded, updated, and transmitted? How effective would you say your current information-retrieval system is? 4. Do you have any dollar amount specifically budgeted for data or telecommunications improvements in 2004-2005? What specific information or communication functions are you most interested in upgrading? Achieving Maximum Utilization of Hospital Facilities 1. Do you experience any problems in obtaining accurate, up-to-date information on the availability of bed space, operating rooms, or lab services? 2.Do you see hospitals as competing with other area hospitals or Homos in the provision of health-care services? If so, with which hospitals? Do you have a marketing plan to deal with this situation? Efficient Use of Labor Resources 1.
How variable is the typical daily departmental workload, and what factors most influence this variance? 2. How do you document and forecast workload fluctuations? Is this done for each hospital department? . To what extent (if any) do you use outside consulting firms to work with you in improving the delivery of hospital services?Reimbursement and Cash Flow 1. Which insurer is the primary provider of funds? How is reimbursement made by the major insurers? 2. What information do you need to verify the existence and type of insurance coverage when an individual is being processed for admission or outpatient hospital services? What, if any, problems are experienced in the verification and communication of insurance information? Source: This case was prepared by D. Asker CASE 8-2 U. S. Department of Energy (A) Judy Reason, the head of the windmill power section of the U.
S.Department of Energy, was considering what types of qualitative marketing research would be useful to address a host of research questions. The U. S. Department of Energy was formed to deal with the national energy problem. One of its goals was to encourage the development of a variety of energy sources, including the use of windmill power. One difficulty was that almost nothing was known about the current use of windmill power and the public reaction to it as a power source.
Before developing windmill power programs, it seemed prudent to address several search questions to obtain background information and to formulate testable hypotheses.Current Use of Windmills in the United States How many power-generating windmills are there? Who owns them? What power-generating performance is being achieved? What designs are being used? What applications are involved? Public Reaction What are the public attitudes to various power sources? How much premium would the public be willing to pay for windmill power sources, both in terms of money and in terms of “visual pollution? ” What is the relative acceptance of six different windmill designs ranging from the “old Dutch windmill” design to an g-beater design?Assignment GE / aka mm/ cool Design one or more qualitative research designs to address the search questions and to develop hypotheses for future testing. If focus- group interviews are CASE 8-3 Accuracy Accuracy was introduced into the U. S. Luxury market in 1986 as a premium car at a bargain price, compared with European luxury imports. Given a $20,000 price tag, it became the best-selling premium import brand. As long as it could underwrite the competition, Sacra’s sales were steady. In 1992, however, European luxury brands such as Mercedes, BMW, and Audio started slashing their prices, and the value of the Japanese yen rose.
Both factors combined to wipe out Sacra’s “premium car at a bargain price” advantage. Another blow came when archival Toyota Motor Corp… And Ionians Motor Corp…
Launched the Lexus and Infinite, even more upscale brands, starting at $35,000. L. Campaign Time Accuracy did not anticipate the resurgence of the European luxury brands. Accuracy is strong in quality, dependability, and value, but it does not perform well in the luxurious, expensive-looking, and prestige departments.
However, as Accuracy discovered, customers want considered, provide a set of questions to guide the moderator. Reference plus status, prestige, comfort, and luxury. So far, Accuracy has struggled to Justify prices and convince buyers that the $40,000 maximum price on the Accuracy Legend will include those attributes.
In the desire to “retool its image,” Accuracy replaced its performance-based ads with luxury ads, such as a campaign nicknamed “Channel ads,” featuring mansions with cobblestone driveways and a towel-draped woman getting a massage in a gazebo. The tag line reads, “Some things are worth the price. ” Competition has rebutted by claiming that their $13,000 Ultimate was “worth far more than the price. Included promotional tours with Cirque du Sole.
Buyers might be getting mixed signals. One-third of Sacra’s regional budget is allocated to dealerships, which typically run hard-sell rather than image ads. Accuracy has also struggled to convince dealers to upgrade their showrooms to fit the luxury image. The line’s well- established brand names, Legend and Integrate, will soon be replaced by bigger, more luxurious cars designed to compete with top-of-the-line, $50,000-plus Lexus and Infinite models.
Equipped with a smaller engine, RL model Accuracy cars will sell for $10,000 less. 35 II.Issues Luxury service and new luxury products will be required to win customers. Should Accuracy keep pouring dollars into he image campaign, or stick to performance and quality, its strengths? What do the consumers want? Design a format for a focus-group discussion to analyze this situation.
(Hint: Consider three formats: exploratory, clinical, experiencing. Will the prestige pitch work to rescue lagging sales? ) CASE 8-4 Exploratory Research on the Layton Hewitt National Visa Card The Layton Hewitt Credit Card In January 2002, Hewitt agreed to be featured on a new Visa credit card offered by the National Australia Bank.With the Layton Hewitt National Visa Card, the bank expected to capitalize not only on the popularity of this nouns player but also on the popularity of Australia’s premier tennis event, the Australian Open. One of the salient features of the card was a low introductory interest rate of 6. 9 percent p. A for the first six months. Furthermore, cardholders could choose between the Standard National Visa Card and the Gold National Visa Card. The extensive market research conducted by the bank prior to the release of the credit card revealed a strong demand for such a product.
The research also indicated that the association of Layton Hewitt with the card would increase customer acquisition, card short-listed based on the information available about heir demographics and chirography’s. The National Australia Bank, which over the previous 18 months had aggressively pursued a strategy of offering innovative products, believed that the Layton Hewitt National Visa Card was an example of an innovative lifestyle product. The Player Layton Hewitt, a top-class tennis player from Australia, stunned the world by defeating the reigning champion Pete Samaras to win the U.S. Open in 2001. His inherent talent was obvious when he beat his older and more experienced opponents at the tender age of 8. He won his first professional title in 1998 hen he was 17 years old.
He decided to discontinue his studies to pursue a full-time career in tennis. His victories, over top-seeded players such as Patrick Rafter, Pete Samaras, Gustavo Quarter, Alex Corrects, Magnum Norman, and many others during the Association of Tennis Professionals (ATOP) tour, established him as the number-one tennis player in the world.Unfortunately, however, Hewitt had to withdraw from the Human Cup in 2002 because he had chicken pox. The 2002 Australian Open was his comeback tournament after his recovery, but he was defeated by Alberta Martin in the early rounds. He attributed his early loss to the fact that he was still recovering from his illness and lacked energy. Source: This case is based on Larry Armstrong, “Accuracy: Stuck between Gears? ,” Business Week, October 2, 1995, up. 136-137, and was prepared by V.
Kumar for classroom discussion. Questions for Discussion 2. 3.What types of demographic and cryptographic information are required for this study? How would you obtain it? Hewitt affect the attitude of prospective and current credit card holders of the bank? How would the company carry out marketing research to study this issue? Design the focus-group study and develop some eye questions that the interviewers can use to elicit the level of demand for the credit card. How would the demand for the credit card be forecasted? 4. How would Hewitt age, lifestyle, personal interests, and personality relate to those of the cardholders?How would you design a marketing research study to identify the demographic characteristics of the prospective cardholders and identify the future customer group? This case was prepared by the authors with inputs from “Layton Hewitt Serves up a Winner for the National,” press release, http://www. National.
Com. AU, January 10, 2002. CASE 8-5 Hamilton Beach Conducts Primary Research in Mexico and Europe Hamilton Beach is well-known in the United States as a maker of small kitchen appliances like blenders, toasters, and mixers. However, the brand is not so familiar in other countries.
When the firm decided to expand into Europe and Mexico with a new product line, they wanted to assess the brand awareness in these markets. Based on the assumption that the Mexican consumer is slightly more prone to buying U. S. Products, the firm wanted to confirm that there was better brand awareness in Mexico. A mixture of qualitative and quantitative research techniques were used in Mexico. Through the study, the firm was looking to determine what features were to be included in the product and the retail environment through which they were going to sell.
They also wanted to find out the acceptance level for the brand and whether the features of the product fit in well with consumer needs. They found that the brand awareness was high in Mexico, and considering the proximity to the United States and the similar taste preferences due to exposure to the same types of products, they were optimistic in going ahead with the product launch. The initial results were promising and indicated success. European market. The research in Europe involved focus groups with the participants being asked to look at and touch the products.
After the participants had an opportunity to examine the products, they were asked to come back and talk about them in general, spontaneous terms. The discussion showed that European consumers were much more focused on design than American consumers. They seemed to like colors, rounded shapes, and good-looking appliances, especially those they plan to leave out on their kitchen counters. European consumers also did not appear to be as interested in product features.For example, while an American consumer perceives an 18-speed blender as definitely added value, the European consumer seemed to perceive it as confusing and therefore as something negative.
The research also highlighted the differences in how Hamilton Beach product designers and consumers define a product line. To the designers, uniformity of things like the color of knobs on the appliances and the fonts used in the instructions make a group of products into a product line. But European consumers felt product attributes like color and shape defined a product line. Hamilton Beach decided to change the whole