Chapter 4 Managing Marketing Information to Gain Customer Insights Friday February 12 2016 6 32 PM Marketing Information Systems MIS It is essential for companies to design effective marketing information systems that give managers the right information in the right form at the right time and help them to use this information to create customer value and stronger customer relationships Consists of people and procedures to Assess information needs Develop the needed information Help decision makers to use the information to generate and validate actionable customer and market insights Figure 4 1 The Marketing Information System This figure shows that MIS begins and ends with information users The information users are marketing managers internal and external partners and others who need marketing information Marketers start by assessing user information needs Next they develop the needed information using internal company databases marketing intelligence activities and marketing research processes Finally the MIS helps the users to analyze and use the information to develop customer insights make marketing decisions and manage customer relationships Assessing Marketing Information Needs A good MIS balances the information users would like to have against What they really needs What is feasible to offer Obtaining analyzing storing and delivering information using an MIS is expensive Firms must decide whether the value of the insights gained from more information is worth the cost Developing Marketing Information Information needed can be obtained from Internal databases 1 2 Competitive marketing intelligence 3 Marketing research Internal Databases Electronic collections of consumer and market information within a company s network Advantage Information can be accessed quickly and economically Disadvantages Data ages rapidly and may be incomplete Maintenance and storage of data is expensive Competitive Marketing Intelligence The goal of competitive marketing intelligence is to improve strategic decision making by understanding the consumer environment assessing and tracking competitors actions and providing early warnings of opportunities and threats Good marketing intelligence can help marketers gain insights into how consumers talk about and connect with their brands Systematic collection and analysis of information About consumers competitors and developments in the marketing environment Techniques Observing consumers Gain insights about consumer opinions and their association with the brand Gain early warnings of competitor strategies new product launces or changing markets and potential competitive strengths and weaknesses Helps firms to protect their own information Quizzing the company s own employees Benchmarking competitors products Researching on the Internet Monitoring social media buzz Advantages Disadvantages May involve ethical issues Marketing Research Systematic design collection analysis and reporting of data Relevant to a specific market situation facing an organization Approaches followed by firms Use own research departments Hire outside research specialists Purchase data collected by outside firms Figure 4 2 The Marketing Research Process Marketing research follows a process that has four steps defining the problem and research objectives developing the research plan implementing the research plan and interpreting and reporting the findings Each of these stages is discussed in detail in the following slides Defining the Problem and Research Objectives Exploratory research Used to gather preliminary information Helps to define problems and suggest hypotheses Descriptive research Used to better describe the market potential for a product or the demographics and attitudes of consumers Casual research Used to test hypotheses about cause and effect relationships The manager best understands the decision for which information is needed whereas the researcher best understands marketing research and how to obtain the information Defining the problem and research objectives is often the hardest step in the research process After the problem has been defined carefully the manager and the researcher must set the research objectives Managers often start with exploratory research and later follow with descriptive or causal research A statement of the problem and research objectives guide the entire research process The manager and the researcher should put the statement in writing to be certain that they agree on the purpose and expected results of the research Research Plan Outlines sources of existing data Spells out Once researchers have defined the research problem and objectives they must determine the exact information needed develop a plan for gathering it efficiently and present the plan to management Research objectives must be translated into specific information needs Specific research approaches Contact methods Sampling plans Instruments that researchers will use to gather new data Should be presented in a written proposal Topics covered in a research plan Management problems and research objectives Information to be obtained How the results will help management s decision making Estimated research costs Type of data required Secondary Data To meet the manager s information needs the research plan can call for gathering secondary data primary data or both Researchers usually start by gathering secondary data The company s internal database provides a good starting point The company can also avail the wide assortment of external information sources Using commercial online databases marketing researchers can conduct their own searches of secondary data sources Internet search engines can also help in locating relevant secondary information sources However they can also be very frustrating and inefficient Information that already exists Collected for another purpose Sources Company s internal database Purchased from outside suppliers Commercial online databases Internet search engines Advantages Can be obtained quickly and at a low cost Can provide data that an individual company cannot collect on its own Disadvantages Researchers may not get all the data they need Information might not be very usable The researcher must evaluate secondary information carefully to make certain it is relevant accurate up to date and impartial Primary Data Information collected for the specific purpose at hand Even though the secondary data is a good starting point for collecting