Chapter 4Rest Stop: Previewing the Concepts• Explain the importance of information in gaining insights about the marketplace and customers• Define the marketing information system and discuss its parts• Outline the steps in the marketing research process• Explain how companies analyze and use marketing information• Discuss the special issues some marketing researchers face, including public policy and ethics issuesMarketing Information and Customer Insights• Consumer needs and motives for buying are difficult to determine• Online sources give marketers abundant data about consumer behavior• Challenge for companies is to make better use of information to gain customer insights• Firms use customer insights to develop a competitive advantage• General Idea• Far from lacking information, most marketing managers are overloaded with data and often overwhelmed by it. For example, when a company such as Pepsi monitors online discussions about its brands by searching key words in tweets, blogs, posts, and other sources, its servers take in a stunning six million public conversations a day, more than two billion a year. That’s far more information than any manager can digest. Thus, marketers don’t need more information; they need betterinformation. And they need to make better use of the information they already have. The real value of marketing research and marketing information lies in how it is used—in the customer insights that it provides.Marketing Information and Customer Insights- Customer Insightso Fresh understandings of customers and the marketplace derived from marketing information that becomes the basis for creating customer value and relationships General Idea- Many companies are now restructuring their marketing research and information functions. They are creating customer insights teams. Customer insights groups collect customer and market information from a wide variety of sources, ranging from traditional marketing research studies to mingling with and observing consumers to monitoring consumer online conversations about the company and its products.Then they use this information to develop important customer insights from which the company can create more value for its customers. Marketing Information System- People and procedures dedicated to assessing information needs, developing the needed information, and helping decision makers to use the information to generate and validate actionable customer and market insightsAssessing Marketing In formation Needs- General Ideao Marketers start by assessing user information needs. Then they develop the needed information using internal data, marketing intelligence, and marketing research processes. Finally they make the information available to users in the right form at the right time.Assessing Information Needs• A good MIS balances the information users would like against what they really need • Collecting and storing information using a MIS is expensive• Firms must decide whether the value of the insights gained from more information is worth the costInternal Databases- Electronic collections of consumer and market information obtained from data sources within the company networko General Idea Information in the database can come from many sources. The marketing department furnishes information on customer characteristics, sales transactions, and Web site visits. Thecustomer service department keeps records of customer satisfaction or service problems. The accounting department provides detailed records of sales, costs, and cash flows. Operations reports on production, shipments, and inventories. The sales force reports on reseller reactions and competitor activities, and marketing channel partners provide data on point-of-sale transactions.Internal Data• Can be accessed more quickly and cheaply than other information sources• Ages rapidly and may be incomplete• Maintenance and storage of data is expensive• Example• Financial services provider USAA uses its extensive database totailor its services to the specific needs of individual customers, creating incredible loyaltyCompetitive Marketing Intelligence- The systematic collection and analysis of publicly available information aboutconsumers, competitors, and developments in the marketing environmento Note to Instructor: 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. Competitive Marketing Intelligence• Techniques include:• Observing consumers • Quizzing the company’s own employees• Benchmarking competitors’ products• Monitoring Internet buzz• Actively monitoring competitors’ activities• Companies also take steps to protect their own informationMarketing Research- The systematic design, collection, analysis, and reporting of data relevant to aspecific marketing situation facing an organizationo General Idea In addition to marketing intelligence information about generalconsumer, competitor, and marketplace happenings, marketers often need formal studies that provide customer and market insights for specific marketing situations and decisions. Sometimes firms simply purchase data collected by outside firms to aid in their decision-making.Figure 4.2 - The Marketing Research ProcessDefining the Problem and Research ObjectivesDeveloping the Research Plan• Should be presented as a written proposal• Should cover:• The management problems addressed• Research objectives• Information to be obtained• How results will help decision-making• Estimated research costs• Type of data required (Primary or secondary)Secondary Data- Information that already exists somewhere, having been collected for anotherpurpose- Common sources of secondary data:o Internal company databaseso Commercial online databaseso Internet search engines- Cheaper to obtain than primary dataExploratory researchGathering preliminary information that will help define the problem and suggest hypothesesDescriptive researchGenerating information to better describe marketing problems, situations, or marketsCausal researchTesting hypotheses about cause-and-effect relationships- Can be collected faster than primary datao General Idea Internet search engines can be a big help in locating relevant secondary information sources.