Marketing Research and New Product Development in Selected Organizations in Enugu State.

Marketing Research and New Product Development in Selected Organizations in Enugu State.

Ikechukwu Njoku, Prof. Wilson Ani
Enugu State University of Science and Technology

DOI: https://dx.doi.org/10.47772/IJRISS.2023.70751

Received: 03 July 2023; Revised: 06 July 2023; Accepted: 10 July 2023; Published: 02 August 2023

INTRODUCTION

1.1 Background of the study

In today’s world, the importance of effective marketing research in new product development (NPD) is now widely accepted wing to rapid advancement in technology, constant changes in consumers’ choices and preferences, and dynamic trends in tastes and fashions. Marketing research has been seen as the very nexus that links customers and firms through information.  It provides information that is used to identify product strengths, weaknesses, opportunities, and threats. It is also used to generate, refine, evaluate, and interpret marketing actions, track marketing performance; and understand marketing as a discipline and process. The concept of marketing research is a very important phenomenon in new product development process. It represents the very first step that determines the success of any product. It also acts as the foundation and cornerstone of any product. To obtain the desired and appropriate results from marketing research, an organization must be guided by certain plans to satisfy all or at least most of the company objectives for it to be worthwhile. Therefore, marketing research if well-defined and formulated has an impact on new product development of an organization. The extent to which the firms put marketing research into practice in solving their marketing problems is what this study intends to examine. Marketing research is now widely accepted as one of the most important assets possessed by organization.

Zikmund (1998) opines that the activities of marketing research include defining the market opportunity and problems, generating, and evaluating market ideas, monitoring performance, and understanding the marketing process. The American Marketing Research Association (2017) opines that marketing research specifies the information required to address issues in marketing, design the method for collecting information, manage and implement the data collection process, analyze the results, and communicate the findings and their implications.

Marketing Research serves as a tool that is used to arrive at strategic and tactical decisions needed by organizations to develop new products that meet the needs of consumers and achieve the objectives of the organization. Conducting research before developing a new product is a strategic step in determining the best way to discover opportunities and gain loyalty in the market.

Prahalad and Hamel (1990) stated that research can lead to a core competence that either differentiates a firm from its competitors or provides a threshold competency that is necessary just to survive in fast-changing and innovative industry sectors. Hollingsworth (1996) and Jeffery (1998) noted that new product development strategies and processes should change following changes in market trends and technology. Marketing research is important for proactive management because it helps to develop marketing options through market segmentation, consumer attitude, product usage studies, and market opportunity analysis (McDaniel & Gates, 2006). Given the importance and value of new product development on a firm’s performance, researchers have developed descriptive frameworks based on linear, recursive, and chaotic system perspectives, which provide different insights and descriptive theories about the new product development process, structure, and behaviour. These are then often the basis for normative research, which seeks to predict and prescribe causality in new product development processes (Griffin, 1997).

Marketing research is the first critical step in developing a new product in the sense that it helps firms understand that products are designed to provide solutions to customers’ problems, and a good product is the one that provides that solution in a better way than products offered by competitors. Finally, the role of research in new product development is to help firms identify competitors, understand consumers’ problems more than competitors do, and then develop better products than the ones offered by competitors. Research is therefore an integral part of every successful new product development process in organizations. This study intends to examine the extent to which organizations deploy marketing research as a tool for solving problems associated with new product development.

1.2 Statement of The Problem

In most organizations, marketing research is the subject that receives the least attention even though the concept of marketing research is a very important phenomenon in the new product development process. Marketing research, in fact, represents the very first step of determining the prospects of every new product and acts as the foundation and cornerstone of conceptualizing such a product. Unfortunately, most managers do not take the step because they feel they can do without it. Managers tend to rely more on intuition, promotional and distributional strategies to develop and push new products into the market but ignore research that provides the very nexus between new products and consumers. Poolton and Barclay (1998) pointed out that because marketing research has not translated very strongly into managerial practice, “managers are still relying on gut-feel with respect to best practice in new product development.” A gutfeel is a feeling or action based on instinct without factual and logical reasoning.  Therefore, it has been established that developing new products that are not well researched, defined, and formulated constitutes a problem to the organization and stands the chance of failing when introduced into the market. To stress the importance of research necessitated this study.

1.3 Objectives of the Study.

The broad objective of this study is to examine the effects of marketing research on new product development, while the specific objectives are to:

1.Examine the effect of survey research method on new product development.

2.Assess the effect of interview research method on new product development and,

3.Evaluate the effect of focus-group research method on new product development.

1.4 Research Questions:

1.To what extent does survey research method affect new product development?

2.How does interview research method affect new product development?

3. In what way does focus-group research method affect new product development?

1.5 Statement of hypotheses:

We formulated the following hypotheses.

Ho1: Survey research method has no significant positive effect on new product development.

Ho2: Interview research method has no significant positive effect on new product development.

Ho3: Focus-group research method has no significant positive effect on new product development.

REVIEW OF RELATED LITERATURE

Conceptual Review.

2.1.1 Marketing Research.

The concept of marketing research is a relatively new phenomenon and a new social order in the management sciences. Research in physical sciences such as medicine, physics, and chemistry has been going on for centuries, but the application of research to solving large-scale marketing problems is a relatively recent development of the last five decades. Therefore, when compared to the natural sciences, marketing research should be considered new and still in its developing stages.

Kotler and Keller (2015) defined marketing research as the systematic design, collection, analysis, and reporting of data and findings relevant to a specific market situation facing a company.

The American Marketing Association (2004) saw marketing research as the systematic gathering, recording, and analyzing of data about problems relating to the marketing of goods and services.

According to the Encyclopedia Britannica, marketing research is the application of the scientific method to the solution of marketing problems. It studies people as buyers, sellers, and consumers, examining their attitudes, preferences, habits, and purchasing power. It is also concerned with the channels of distribution, promotion, and pricing and with the design of the product and services to be marketed.

We define marketing research as the systematic application of scientific methods to identify and solve marketing problems. This definition means that marketing research is a systematic and scientific process that identifies long- and short-term marketing problems and aids in long-term decision making in providing solutions to those problems.

2.1.2 Survey Research Method.

Survey research is a scientific, and systematic method of collecting research data from respondents using multiple survey questions. This includes collecting information from individuals, analyzing, and interpreting them. This type of research is very effective and useful for researchers who aim at communicating new features or trends to their respondents.

Survey research can use quantitative research strategies, qualitative research strategies, or both strategies (Julie Ponto,2015). Singleton & Straits, (2009), pointed out that as it is often used to describe and explore human behavior, surveys are therefore frequently used in social and psychological research. The three main survey research methods include email/online phone and face-to-face methods.

2.1.3 Interview Research Method.

Interview is a qualitative research method that relies on asking useful and insightful questions to respondents to obtain data necessary for drawing an inference.  Interview questions can either be structured, unstructured or semi-structured. Interview research method helps the researcher to better explore, understand, and explain, research subjects’ opinions, behavior, experiences, and phenomenon .Oakley (1998) opined that qualitative interview is a type of framework in which the practices and standards be not only recorded, but also achieved, challenged and as well as reinforced. Unstructured interviews are often used in conducting long-term field work and allow respondents to let them express in their own ways and pace, with minimal hold on respondents’ responses. The best form of Interview questions are usually open-ended questions so that in-depth information will be collected

2.1.4Focus-group Research Method.

Focus group research method assembles a small group of people to answer questions in a moderated settings on a particular topic of interest. The group is usually chosen based on certain predefined demographic traits that is common among the members, and the questions are usually designed to shed light on a topic of interest. Focus group is also a type of qualitative research. Focus group often takes certain steps to be conducted. such steps include choosing a topic of interest, defining the scope and hypothesis, determining focus group questions, hosting the focus group, recording the discussions, analyzing, and interpreting the results. Focus groups research is prevalent in marketing, library science, social science, and management disciplines. Focus group has a unique way of providing more natural feedback than individual interviews. It is also easier to organize than experiments or large-scale surveys.

2.1.5 New Product Development (NPD)

New product development is a systematic and sequential decision process that helps firms to discover, produce, launch, and manage new products in the market. It entails a series of interconnected decisions that combine other variables to achieve the desired goals of developing a new product. The process of New Product Development (NPD) is often cumbersome and costly as it involves substantial time and expense. As such, it is essential to manage NPD effectively and efficiently to achieve the desired outcome. Anderson (1993) states that a firm’s overall new product performance depends on the five elements: the process; the organization of the programme; the strategy; the culture and climate for innovation; and senior management commitment to new product development. However, application to actual practice has been somewhat less common.

Poolt on and Barclay (1998) opine that research on NPD success factors is too generic and has not actually been applied to specific contexts very well. They pointed out that success factors and their importance depend heavily on industry and firm characteristics. They also opined that most research focuses too heavily on various variables of analysis. The new product development process has seven stages which include: idea generation, idea screening, concept development & testing, market strategy & business analysis, product development, deployment, and market entry/commercialization.

Step 1: Idea Generation. The first step in new-product development is idea generation; new ideas can be generated through marketing research, consumers’ feedback, or employee brainstorming.

Step 2: Screening and Evaluation of Ideas. Some firms create an “Idea Committee” that studies all the generated ideas very carefully with the view to selecting the good ideas and rejecting the bad ones. They consider various available options before choosing the right one.

Step 3: Concept Development and Testing. This stage comes after idea screening. It is, however, different from test marketing. The firm uses this stage to ascertain whether the consumers will accept the product or not. If most of the consumers like the product, then business analysis is done.

Step 4: Business Analytics. At this stage, a detailed business analysis is done. The company finds out whether the new product is commercially profitable or not, possible cost, demand for the new product.

5. Product creation. At this stage, the company has decided to introduce the new product to the market. It will take all the necessary steps to produce and distribute the new product.

6.   Test marketing. Test marketing means introducing the new product on a very small scale in a very small market. If the new product is successful in this market, then it will be introduced on a large scale.

7. Commercialization. If the test market is successful, then the company will introduce the new product on a large scale to the market.

The Conceptual Framework.

Figure 2.1; Conceptual Framework.

Source: Adapted from Nebo, G.N and Onyeke, J.K (2021), Principles of Modern Marketing, Enugu: Rhyce Kerex Publishers.

A conceptual framework of this study represents the relationship between the variables used and new product development. Survey, interview, and focus-group research methods are closely related in the sense that they are also part of marketing research and can be used independently or jointly to carry out marketing research.

2.2 Theoretical Framework.

The Halo-effect theory was developed in 1920 by a psychologist, Edward Thorndike. He stated that that the cognitive bias in our judgments is affected by our overall perception of something important to us. This means that the evaluation of a particular attribute of a product will come from the respondents’ overall impression of the brand, rather than an objective evaluation of the specific attribute being evaluated. A recent experience whether good or bad with a brand can affect the respondent’s evaluation of all facets of the brand and wipe out every good perception they have with the brand over a long period of time. This theory therefore relates to the conduct of marketing research in the areas of collecting data, designing questionnaires, analyzing, and interpreting the result because a little sensitive issue early in the survey can significantly affect the evaluations expressed by the respondent throughout the survey process. For instance, a survey with a poorly written scripts could affect the cognitive effort of respondents due to a lack of motivation. Some other sources of the halo-effect include product attributes, brand familiarity, peer pressure, believes, demography, literacy level and brand popularity. However, one of the ways remedy halo effects is to introduce covariates or blocking variables in our analysis that would help us to control these halo effects, such as a measurement of the “level of brand familiarity”, or “perceived popularity among friends”.

2.3 Empirical Review.

A good number of studies show that marketing research is the bedrock of marketing.

Nyumba, Wilson, Derrick,& Mukherjee (2018) investigated the use of focus group discussion methodology:  and insights from two decades of application in conservation and found that focus group discussion usually yields both qualitative and observational data where analyses can be demanding.

Adhabi & Anozie (2017); studied Literature Review for the Type of Interview in Qualitative Research and found that interviews remain central tothe authenticity of the data collected for qualitative studies.

Julie Ponto (2015) studied the understanding and Evaluating Survey Research Julie Ponto and concluded that Survey research is a useful and legitimate approach to research that has clear benefits in helping to describe and explore variables.

According to Guenzi and Troilo (2006), marketing sales integration is a multi-aspect construct made up of various components, which influence different marketing capabilities and highlighted its antecedents and consequences.

Vorhies & Morgan (2005) noted that market-based organizational research and learning are primary sources of sustainable business competitive advantage. They also pointed out that benchmarking is used as a management tool for identifying and enhancing valuable marketing capabilities. Bench marking is a process that involves measuring the performance of a new product against a competitor in the same market.

2.4. Summary of Empirical review.

Table 2.4.1: Summary of Empirical Reviews.

Source: Research compilation 2022.

2.5 Gap in Empirical Review.

Relevant empirical review of marketing research indicates that it has a significant role to play on new product development through its integration with strategy formulations and implementation. However, the empirical studies reviewed above were conducted in advanced countries that included USA, India, Britain, Norway, and Belgium using multinational institutions, but this study was conducted in Nigeria using mostly local organizations beside Coca-Cola that is a conglomerate. The variables used in most of the studies are similar with this which include various types of marketing research, but the context was different in the sense that respondents are different. The design methods used in most were theoretical and review methods while empirical and descriptive design methods were used in this study. The differences created a gap in the study.

METHODOLOGY

3.1 Research Design

 For this study, empirical and descriptive design methods were used. The various samples were studied to establish if there are significant relationships between the variables (Survey, interview, and focus-group research methods), and new product development.

3.2 Area of Study

This study was conducted within 9th mile, Ama, Emene, and Garden Avenue GRA all located in Enugu Nigeria. The locations were chosen because of the offices of the organizations of interest.

3.3 Sources of Data

In this study, the researcher sourced data from primary sources.

3.3.1 Primary sources of data: The researcher collected primary data through questionnaires. Line staff of five major firms within 9th mile, Ama, Emene and Garden Avenue in Enugu were asked to rank the effect of survey, interview, and focus group research methods on new product development. The companies include Nigeria Breweries Plc, Nigeria Bottling Company, Innoson Group, First Bank, and Access Bank.

3.4 Population of The Study

The population of study which is 60 was drawn from senior staff of Nigeria Breweries Plc, Nigeria Bottling Company, Innoson Group, First Bank Holdings and Access Bank. They are made up of 14 staff each from the organizations who carry out research and contribute to the research and development unit of the organizations. The accessible population approach was used, in which a small proportion of the overall population was chosen for the study. They given questionnaires after identifying them through the help of a senior staff and asked to rank the relationship between variables using a 1 to 10 scale, and their rankings were recorded by the researcher.

3.5 Determination of Sample Size.

Because of the size of the population, the entire population of 60 were used to carry out the research. Therefore, 60 was the sample size used.

3.6 Sampling Techniques

A non-probability sampling technique of purposive/judgmental was used in this study. This is a type of non-probability sampling technique that allows a researcher to rely on his/her own personal judgment to choose members of the population for a survey.

3.7 Instrument of Data Collection

The instrument used for data collection was questionnaires.

3.8 Validation of research instruments

The essence of validity is to confirm the extent to which the research process was able to arrive at the desired results. The questions were carefully selected, and the responses analyzed carefully to avoid ambiguity. The questions were validated by the supervisor before they were shared to respondents. This process helped to make the outcome valid.

3.9 Reliability of The Research Instrument.

Test-Retest Reliability measures were used to test the consistency of the research instrument. The questionnaires were given to the same respondents twice at different times to see if the responses are the same.

Although the researcher distributed the questionnaires himself, the questions and answers were given to experts to analyze and certify.

3.10 Method of Data Analysis

 The collated results were analyzed using Spearman’s rank correlation coefficient.  This was done to establish the degree of relationship or variation between survey, interview, and focus group research methods, which are the independent variables, and new product development, which is the dependent variable.

DATA PRESENTATION AND ANALYSIS

4.1Data Presentations

The table below shows details of responses from the questionnaires.

TABLE 4.1: DISTRIBUTION OF QUESTIONNAIRES

Source: Field Survey, 2022

The statistical analysis above shows that 60 of the respondents responded to the questions, which is 100%.

Analysis Of Respondents’ Biodata

The following are the characteristics and biodata of the sample in the study.

Table 4.2: Gender of Respondents

Source: Field Survey, 2022

The table above shows that 42 respondents are male representing 70%, while 18 respondents are female which represents 30% of the respondents. This indicates that there were more male respondents than female respondents.

Table 4.3: Marital Status of Respondents.

Source: Field Survey, 2022

The analysis above shows that 12 respondents are single which is 20%, 48respondents are married which represents 80%. This implies that there are more married people in the organizations than single.

Table 4.4: Age of Respondents

Source: Field Survey, 2022

From the table above, it shows that 30 respondents each are below 45 years and 45 years and above representing 50% each. This indicates that there are equal respondents in these categories.

Table 4.5: Academic Qualification of Respondents

Source: Field Survey, 2022

 The analysis shows that42 respondents which is 70% have HND/BSc certificates while 18respondents are master’s degree holders which represents 30%. From the above analysis, most of the respondents are holders of HND/BSc certificates only.

SECTION B

TABLE 4.6.A total 60 staff were asked to rank the relevance of survey, interview, and focus group research methods to new product development on a scale of 1 to 10(10 being the highest rank).

The interpretation of the table below shows that 4 staff ranked new product development 2, ranked survey method 3, ranked interview method 4 and focus group2 respectively. This followed horizontally till the last ranking.

Source: Field Survey, 2022.

4.2 Data Analysis.

Data analysis was done using spearman’s rank correlation coefficient.

Spearman’s Rank Correlation Coefficient.

The rank correlation coefficient is commonly used for qualitative variables that cannot be easily quantified. Examples of such variables include survey, interviews, and focus-group research methods.

In such cases, the observations are ranked in a specific sequence, such as in order of size, relevance, usage, etc. Numbers 1, 2,3,4… n ranks are assigned to the data that will help to measure the relationships between their ranks instead of their actual numerical values.

When variables X and Y are ranked, the rank correlation coefficient is computed by:

                6 Σd2

r=    1-   ___________

              n (n2 – 1)

Where.

r = Spearman’s rank correlation coefficient

d=difference between the two ranks of each observation.

n=number of observations.

However, it is important to point out that the ranking of the observations can be either in ascending or descending order, and this does not matter.

INTERPRETATION OF CORRELATION COEFFICIENT (r)

The type of relationship is represented by the correlation coefficient:

(r =1): This shows a perfect positive correlation.

(1 > r > 0) This indicates a significant positive correlation

(r = 0): This shows no correlation.

(0 > r > 1). This indicates a negative correlation.

(r = -1) indicates a perfect negative correlation.

4.3 Test of Hypotheses

Hypothesis one.

Table 4.7: Ho1: Survey research method has no significant effect on new product development.

 6 Σd²

r=    1- ___________

n (n² – 1)

The formulated hypotheses are tested using spearman’s rank correlation coefficient.

r=1- 6(107)

60(60²-1)

r= 1-642

215999.

r= 1-0.00297

r=0.997

From the decision rule, 0.997 falls within (1 >r > 0):

This therefore shows that there is strong positive relationship between survey research methodand new product development. We therefore reject the null hypothesis and conclude survey research method has significant effect on new product development.

Hypothesis Two.

Table 4.8. Ho2: Interview research method has no significant effect on new product development.

 6 Σd²

r=    1-   ___________

n (n² – 1)

This formulated hypothesis is tested using Spearman’s rank correlation coefficient.

r=1-     6(140)

         60(60²-1)

r= 1-     840

           215999.

r= 1-0.003889

r=0.996

From the decision rule, 0.996 falls within (1 >r > 0):

This therefore shows that there is strong positive relationship between interview research method and new product development. We therefore reject the null hypothesis and conclude that interview research method has significant effect on new product development.

Hypothesis Three

Table 4.9: Ho3: Focus group research method has no significant effect on new product development.

 6 Σd²

r=    1-   ___________

n (n² – 1)

This formulated hypothesis is tested using Spearman’s rank correlation coefficient.

r=1-     6(100)

         60(60²-1)

r= 1-     600

           215999.

r= 1-0.00277

r=0.997

From the decision rule, 0.997 falls within (1 >r > 0):

This therefore shows that there is strong positive relationship between focus group research method and new product development. We therefore reject the null hypothesis and conclude that focus group research method has significant effect on new product development.

DISCUSSION OF FINDINGS

In this research, we spelt out objectives, raised research questions, and developed testable hypotheses from the objectives. We tested the three hypotheses using Spearman’s rank correlation coefficient using the various variables and the findings are as follows.

1.Survey Research Method.

The calculated rank correlation coefficient for survey method is 0.997 indicating a strong positive relationship between survey research method and new product development.

2. Interview Research Method.

The calculated rank correlation coefficient for interview research method is 0.996 indicating a strong positive relationship between interview research method and new product development.

3. Focus-group Research Method.

The calculated rank correlation coefficient for focus-group research method is 0.997 indicating a strong positive relationship between focus group research method and new product development.

This study is in line with the findings of Nyumba, Wilson, Derrick,& Mukherjee (2018), Adhabi & Anozie (2017) and Julie Ponto (2015) who buttressed the importance of survey, interview, and focus group research method in marketing. The study also agrees with Edward Thorndike’s Halo-Effect Theory which maintains that the cognitive bias in our judgments is affected by our overall perception of something important to us. This means that the evaluation of a particular attribute of a product will come from the respondents’ overall impression of the brand, rather than an objective evaluation of the specific attribute being evaluated. Their findings agree with the findings of this study that marketing research is a vital tool for new product development.

SUMMARY OF FINDINGS, CONCLUSION, AND RECOMMENDATIONS

5.1 Summary of Findings

This research focused on the marketing research and new product development. Below are the findings of this study.

1. The calculated rank correlation coefficient for survey method is 0.997 indicating a strong positive relationship between survey research method and new product development.
2. The calculated rank correlation coefficient for interview research method is 0.996 indicating a strong positive relationship between interview research method and new product development.
3. The calculated rank correlation coefficient for focus-group research method is 0.997 indicating a strong positive relationship between focus group research method and new product development.

5.2 Conclusion

Based on the findings of this study, it was concluded that marketing research methods namely, survey, interview and focus grouphave significant positive relationship with new product development.

5.3. Recommendations

The following recommendations are made:

1.Organizations should carry out research using survey, interviews or focus group methods before embarking on new product development.

2.Firms should allocate adequate resources to the marketing department for research purposes.

3.Marketing experts and trained researchers should be engaged by organizations to handle research activities for them.

Through this research, firms will further realize that conducting marketing research before embarking on new product development is not a waste of time and resources but a worthwhile exercise that will ensure that the new product meets the needs of the consumer.

5.4. Suggestions for Further Studies

Given the above findings, the following suggestions are made for further studies.

1. The reasons why new products fail in the market despite the huge expenses employed in producing them should be investigated and documented.
2. Promotional activities that would help new products be accepted in the market should also be studied and documented.
3. New product features, production cost, segmentation and distribution strategies should also be studied and documented to aid organizations.

5.5 Contribution to Knowledge

The primary aim of this research is to examine the role of effective marketing research in new product development. The study focused on the importance of marketing research, starting from the conceptual stage to production and then the launch of new products in the market. Most previous studies on the role of marketing research in new product development looked at the various activities of firms and their efforts in developing new products but did not dwell much on the important methods of marketing research which include survey, interview, and focus-groups. Most firms rely on gutfeel and intuition to discover new products, thereby relegating marketing research to the back. This study has now successfully linked survey, interview, and focus-group research methods to new product development.

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MAKING OF THE QUESTIONAIRES

INSTRUCTION: Kindly provide the below information relating to your personal data.

SECTION A: Personal Information/Data

1. Gender

1. Male
2. Female

2. Age grade

1. Below 45 yrs
2. 45 yrs and above

3. Educational qualification

1. OND/HND/BSC
2. MSC/PGD/PhD

4. Marital status

1. Single
2. Married

SECTION B:

Questions on the role of effective marketing research on New Product Development. In a scale of 1 to 10, please indicate the degree of relationship between new product development and survey, interview, and focus group research methods as shown below.

5. How would you rate the effects of survey research method on new product development?

a. Survey Research Method

b. New product development

6. How would you rate the effects of interview research method on new product development?

c. Interview Research method

d. New product development

7. How would you rate the effects of focus-group research method on new product development?

e. Focus-group Research method

f. New product development