Why International Researches are Important to Global Marketing?
Market research is the vital link between the organization and its customers. The objective of sound market research is to interpret consumer behavior and translate the perspective of key customers into actionable marketing strategies. Without this open dialog with customers, companies are unable to keep in touch with vital consumer behavior trends and the many influences that affect the customers of an organization. In today's consumer environment of over-choice and over-communication, growth can only be realized by organizations that are very skilled at crafting well-targeted strategies directed at specific micro-niches of the larger macro market. Companies that go to market without first uncovering specific segment needs and perceptions risk facing the monumental cost of marketing failure.
As more organizations pursue global business strategies, they will require and demand international sources of market information. In order to compete effectively in the 21st century, these businesses will need specialized, targeted information about buyers in dispersed international markets. Connell (2002) argues that, in the business-to-business market, there is ample justification for conducting international market research in support of the design, execution, and interpretation of a wide variety of global marketing strategies.
What would be the problem in conducting these researches referring to primary and secondary researches?
Primary research refers to research that is done from scratch. In other words, researchers are in the field gathering information for the first time, raw data. Secondary research consists of mining and analyzing existing research in the form of reports, articles, literature and other sources to find data to support a specific goal. The two forms of research are different and pose different challenges.
Problem with Secondary Data Research
In the global market scene, some of the information sought by market researches does not exist. When data are missing, the researcher needs to infer the data by using proxy variables or values from previous periods. Even if the datasets are complete, the researcher will usually encounter many problems:
Accuracy of Data
The accuracy of secondary data is often questionable for various reasons. The quality of information may also be compromised by the mechanisms that were used to collect it. Due to lack of resources and skills, many developing countries have to rely on rather primitive mechanisms to collect data.
Age of Data
The desired information may be available but outdated. Many countries collect economic activity information on a far less frequent basis than the United States. The frequency of census-taking also varies for country to country. In many developed countries such as Malaysia, Italy, Spain a census is carried out every ten years.
Reliability over time
Often companies are interested in historical patterns of certain variables to spot underlying trend. To track trend researcher has to know to what degree the data are measured consistently over time. Juggling with economic variable measures is especially likely for variables that have political ramifications, such as unemployment and inflation statistics. For instance, government authorities may adjust the basket of goods used to measures inflation to produce more favorable number.
Problem with Primary Global Marketing Research
Cultural challenges
Conducting market research in an international market requires a great deal of new learning. The effect of culture is multifaceted in the sense that cultural values that are important to one group of people may mean little to another. Cultural differences deeply affect adoption of products and services and other forms of market behavior. Clearly, cultural forces have taken on strategic importance that cannot be ignored when marketing new and/or existing products and services. Social factors embody a culture's fundamental organization, including its groups and institutions,
Language
Now that market research is being conducted around the globe, researchers must take language and cultural factors into account when designing questionnaires. Language represents the most obvious factor that makes international market research so challenging. While many middle and upper management executives worldwide have some command of the English language that does not mean that English must be employed in conducting all research. To make matters even more complicated, variations within the same language may exist. For example, English speakers in the U.K. and America have long complained that they are separated by a common language.
Measurement Issues
In international market research, it is critical to establish the equivalence of scales and measures used to obtain data from different countries (Han, Lee, & Ro, 1994). One of the significant issues that must be dealt with early in the international market research process is the equivalence of data (Kumar, 2000). This involves three considerations. First, it has to be ascertained whether the constructs being studied are equivalent. In other words, are the same phenomena being studied in both countries? Second, the equivalence of the measures of the concepts under study has to be determined. This means that the phenomena are being measured consistently in each country. Finally, the equivalence of the sample being studied in each country or culture must be considered. The issue here is that the samples used in each country are equivalent to each other (Kumar, 2000). These considerations involve substantial measurement issues that are increasingly critical in an international environment. The concepts of reliability, defined as consistency over time, and validity, which is concerned with what the instrument is actually measuring, are important to any market research effort, especially those that cross national boundaries.
Currency fluctuations
Doing business around the world always involves the risk of changes in a particular country's currency. Market research firms are also impacted by these fluctuations because of the numerous field services that are usually hired to complete a research assignment. To finish a given project, several countries might be involved. For example, each spring and fall, IBM conducts a brand tracking study in 14 languages in 27 countries. At any time, one or more of these countries will experience unstable currency conditions, affecting the lead research supplier (Iyer, 1997).
Legal issues
Legal and privacy restrictions pose unique challenges in the international research arena. European countries with strict privacy regulations can potentially shut down marketing activities that profile or collect personal information. Gaining access to specific respondents can also be problematic in certain countries. Furthermore, the Chinese are monitoring questionnaire construction and even the approval of the final data. This is in direct conflict with the American approach of non-disclosure of proprietary client results (Meijer, 1999).
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