BUSI 453 Week 2 QMR Report: Draft 1 Example

Should a Local Studio Sell On-Demand Classes? Problem Definition, Approach and Research Design

Background

Riverside Cycle and Strength is an independent fitness studio in Lynchburg, Virginia, with 640 members paying $89 a month for unlimited live classes. Since 2022, average weekly attendance per member has fallen from 2.4 to 1.9 classes. Exit surveys show that 31 percent of members who canceled cited schedule conflicts, often travel or shift work. The owner is considering an on-demand library of recorded classes, filmed with the studio's own instructors, for $15 a month on top of membership. Filming equipment and editing would cost about $18,000 the first year. Two larger gyms in town already include app-based workouts in their memberships, but neither offers classes taught by instructors members know. The owner believes that familiarity is Riverside's edge, and wants evidence before spending a sum equal to about two months of the studio's profit.

Step 1: Problem Definition

In the terms Malhotra (2015) uses, the owner's choice is an action question, while the study must pin down the information that choice depends on. Here the management decision problem is whether Riverside should launch the $15 on-demand subscription. The marketing research problem is to determine members' likely adoption of an on-demand class library, the price they would accept and the member characteristics associated with adoption.

The specific components are:

• What share of members say they would subscribe at $15 a month?
• Which class types would they most want on demand?
• Do members who travel or work irregular hours report higher interest?
• Do members who already use online workout videos report higher interest?

The study does not ask whether the library should be free to all members, an option the owner ruled out because of its cost, or how to film and edit classes, which is an operational question rather than a marketing one. Keeping those questions out of scope keeps the survey short.

Step 2: Approach

Theoretical Framework

Davis's technology acceptance model proposes that whether someone plans to adopt a new technology rests chiefly on two beliefs, that the technology will help them and that it will be easy to use (Davis, 1989). Later work combined this model with others into a unified theory in which expected benefits, expected effort, the views of others and the support available all shape whether people intend to adopt and then do, with experience moderating several of those links (Venkatesh et al., 2003). For a fitness studio, perceived usefulness is whether recorded classes would help members exercise when they cannot attend, and prior experience with workout videos stands in for ease of use.

Analytical Model

Malhotra (2015) describes analytical models as verbal, graphical or mathematical representations of the theory. Stated verbally, the model for this study is that perceived usefulness leads to intention to subscribe, and that two member characteristics, prior video use and schedule constraint, raise intention both directly and by making the library seem more useful. Intention, in turn, is expected to relate to the price a member would pay. The model is simple on purpose, because a short member survey can measure only a few constructs well.

Research Questions and Hypotheses

• RQ1: How useful do members perceive on-demand classes to be, and how strongly do they intend to subscribe?
• RQ2: Does prior use of online workout videos relate to intention to subscribe?
• RQ3: Do schedule constraints relate to intention to subscribe?
• H1: Perceived usefulness of on-demand classes is positively related to intention to subscribe.
• H2: Members who have used online workout videos in the past six months report higher intention to subscribe than members who have not.
• H3: Members who travel for work at least monthly or work irregular shifts report higher intention to subscribe than members who do not.

Stated intentions overstate actual purchases, but they are useful predictors when measured carefully and adjusted (Morwitz et al., 2007). The survey will therefore treat stated intention as an upper bound and convert it to a conservative forecast before any revenue projection.

Information Needed

To answer the research questions, the study needs each member's perceived usefulness of on-demand classes, intention to subscribe at $15, highest acceptable monthly price, preferred class types, recent use of online workout videos, work travel and shift patterns, and length of membership. Membership length and attendance can be matched from the studio's records, which keeps the survey shorter.

Secondary Data

Malhotra (2015) advises reviewing secondary data before collecting primary data. The studio's booking system shows that 212 members, about a third, attended fewer than four classes in at least one of the past six months, and that cancellations peak in summer and December, when travel is common. These records identify the segment most likely to value on-demand classes, but they cannot reveal interest or acceptable price, which requires asking members directly. External secondary sources, such as published research on home exercise and trade reports on digital fitness, describe the market in general, but they report on large national brands rather than local studios and cannot say how Riverside's own members would respond to a library taught by their own instructors.

Step 3: Research Design

The study will use a descriptive, single cross-sectional design: a survey of a sample of members, measured once (Malhotra, 2015). An exploratory design such as focus groups would generate ideas about content but could not estimate the share of members likely to subscribe. A causal design, such as offering a trial at different prices, would give stronger evidence of purchase but would require building the library before knowing whether it is worth building. A survey fits the decision's timing and budget.

Malhotra (2015) compares survey methods by their flexibility, speed, cost, response rate and control of the data collection environment. A telephone survey would allow follow-up questions but would cost staff time and reach members during work hours. A paper survey at the front desk would miss exactly the members the study most needs, those who rarely visit. An online survey is fast and inexpensive, lets members answer when convenient, and reaches the infrequent visitors through the app and email.

The survey will be delivered online through the studio's member app and email, which reaches all members at no cost, with a $10 smoothie credit for completion. Draft 2 will develop the measurement scales and questionnaire, and Draft 3 will report fieldwork and test the three hypotheses with a correlation and two independent-samples t-tests.

References

Davis, F. D. (1989). Perceived usefulness, perceived ease of use, and user acceptance of information technology. MIS Quarterly, 13(3), 319-340. https://doi.org/10.2307/249008

Malhotra, N. K. (2015). Essentials of marketing research: A hands-on orientation. Pearson.

Morwitz, V. G., Steckel, J. H., & Gupta, A. (2007). When do purchase intentions predict sales? International Journal of Forecasting, 23(3), 347-364. https://doi.org/10.1016/j.ijforecast.2007.05.015

Venkatesh, V., Morris, M. G., Davis, G. B., & Davis, F. D. (2003). User acceptance of information technology: Toward a unified view. MIS Quarterly, 27(3), 425-478. https://doi.org/10.2307/30036540