Coffee Time Scenario

Running head: MANAGING RESEARCH DESIGN

Managing Research Design

University of Phoenix

MBA510 - Managerial Decision Making

June 26, 2007

Introduction

The purpose of this paper is to assess the information readily available to Coffee Time for the purpose of opening a new location in India. The researchers will identify additional data needed in order for Coffee Time to make a more calculated decision. The limitations of available data will be discussed as it relates to the validity and reliability of the data as well as how to obtain a random sample. Lastly, as research has its limitations, decision-making strategies and suggestions will be offered on how to best address certain constraints to assist Coffee Time in their quest to expand into South Asia.

Managing Research Design

Coffee Time has identified India among other South Asian countries as possible sites for expanding business. Upon returning from a trip to India, Brad Collins, Senior Vice-President of Marketing worked with Total Access, Coffee Time's market research firm, to organize data that would be viewed concerning India and its potential market.

Brad's diary noted that India is a country constantly developing and expanding its economic base. The country has a population three times that of the United States but is only a third of the size. There is a mixture of small villages as well as busy cities that make up this diverse country. India is ranked as one of the most influential economies of South Asia. Lastly Brad's diary spoke of how India's government supports the growing market and recently experienced reform that would assist with new opportunities for business oriented people and entrepreneurs.

Total Access put together a snapshot of India to include the following facts and figures: the area is 3,287, 590 sq. km; population of more than 1,000,000,000; with New Delhi being the capital city. While Hindi is the national language of India there are approximately 24 major languages and English will be important when it comes to relating in commercial communication. The Indian Rupee (R) is the currency used and 50 rupees are equal to one U.S. dollar. This will be important when comparing revenue and other information that deals in financial matters.

Other information provided by Total Access was a list of trading partners that included: the United States, Hong Kong, the United Kingdom, Japan, Germany, Belgium, and Saudi Arabia. Lastly, reported was information concerning the countries natural resources, principal crops, and major industries. This accumulative information can be considered a reporting study used "to provide an account or summation of some data" (Cooper & Schindler, 2003, p. 28).

When attempting to enter a new market, Coffee Time uses a two step marketing research concept; secondary research and primary research. In order for Coffee Time to reach its research objectives of deciding what city or cities in India to enter; what target segment to use; and estimating revenue per store, additional studies were required.

By using secondary research provided by Total Access, Coffee Time was able to review the perceptual map of 12 Indian cities that have been classified by extent of prosperity and cultural outlook as well as the population of consumers. "Secondary research (also known as desk research) involves the summary, collation and/or synthesis of existing research rather than primary research, where data is collected from, for example, research subjects or experiments" (Wikipedia, 2007). This information will be used to identify cities in which secondary data is required.

After reviewing the data, Coffee Time requested additional information concerning demographics, leisure and lifestyle, along with competition within the cities of interest. The demographic information provided population by age, gender division, monthly income, and education. The leisure and lifestyle information included average daily visitors to a mall, the number of malls, and the number of restaurants per square kilometer. The information concerning competition included the number of coffee chains, market size for coffee powder, and number of restaurant chains.

As a means of primary research, Coffee Time formulated a survey that will provide further data to assist with decision making. "Primary research (also called field research) involves the collection of data that doesn't already exist" (Wikipedia, 2007). The results of the survey should provide data concerning consumer behavior to help with preparing customer profiles and developing Coffee Time's marketing communication projects. Other questions regarding outside consumption, location, types of coffee including a focus on special flavors, how much coffee drunk, and visits to coffee bars to drink coffee, can provide information that can be used to determine market strategies, measure frequency, and estimate revenues.

Coffee Time can use the data it has compiled to make a decision on how the company should proceed with its plan to expand to India, assuming the data is meaningful and usable. Coffee Time needs to be able to identify the right information that will enable the company to make a sound business decision and realize its revenue goals. Additionally, Coffee Time should understand that data limitations could affect the validity and reliability of the data. The effects could be major or minor. Rarely are there perfect research designs in business research. "Some of the imperfections may have little effect on the validity and reliability of the data; others may invalidate them entirely" (Cooper & Schindler, 2003, p. 17). The data that Coffee Time assembles will allow it to make preliminary assumptions about the market in India. Although secondary research revealed information about the country's population and levels of affluence, the company will need to gain additional information, through primary research methods, about the spending and coffee-drinking habits of the population especially since India has historically been considered a tea- drinking society. Coffee Time will need to find ways to promote coffee as an attractive alternative to tea. Coffee Time will be able to obtain relative information through well-designed research