Marketing ManagementManagement

Amarketing information systeminformationsystem consists of people, equipment, and p ocedu es to gat e , so t, a a y e,rocedurestogather, sort,analyze, evaluate, and distribute needed, timely, and ccu e o o o accurate information to marketing decision makers.

Marketing Management

Part 2:

Gathering Information and

Scanning the Environment

Chapter 3 p Gathering Information and

Scanning the Environment

• 1 Modern Marketing Information System1 Modern Marketing Information System

• 2 Internal Records and Marketing

Intelligence

• 3 Analyzing the Macro-environment

• 4 The Demographic Environment

1 What is a

M k ti I f ti S t (MIS)?

Marketing Information System (MIS)?

A marketing information system

consists of people, equipment, and procedures to gather, sort, analyze,

p ocedu es to gat e , so t, a a y e,evaluate, and distribute needed, timely,

and accurate information to d ccu e o o omarketing decision makers

2 Internal Records and Marketing

I t lli

Intelligence

• Order-to-payment cycleOrder to payment cycle

• Sales information system

• Databases, warehousing, data mining

• Marketing intelligence system

Steps to Improve Marketing Intelligencep p g g

• Train sales force to scan for new developments

• Motivate channel members to share intelligence

• Network externally

• Utilize a customer advisory panel

• Utilize government data sources

• Collect customer feedback online

• Purchase information

Sources of Competitive Informationp

• Independent customer goods and service p g

review forums

• Distributor or sales agent feedback sites

• Combination sites offering customer reviews and expert opinions

• Customer complaint sites

• Public blogs

3 Analyzing the Macro-environment

3.1 Needs and Trends

social economic and political significance " social, economic, and political significance."

future and provides many opportunities

political and technological changes [that] are slow to form, and once in place, they influence

us for some time between seven and ten

us for some time— between seven and ten

years, or longer."

10 Keys Customer Insights: Robert Shieffer

3.2 Trends Shaping the Business

• Increases in

public-sector activity

• Change in consumer

global industry structures

• Ubiquitous access to landscape

• The Power of Spirituality. In turbulent times, we look within; 78 percent seek more Spirit Meditation and yoga soar Divine Presence spills into business “Spiritual” CEOs

as well as senior executives from Redken and Hewlett-Packard (HP) transform their companies.

• The Dawn of Conscious Capitalism. Top companies and leading CEOs are

re-inventing free enterprise to honor stakeholders and shareholders Will it make the world

a better place? Yes Will it earn more money? That’s the surprising part: Study after study shows the corporate good guys rack up great profits.

• Leading from the Middle. The charismatic, overpaid CEO is fading fast Experts now say “ordinary” managers, like HP’s Barbara Waugh, forge lasting change How do they y y g , g , g g g y

do it? Values, influence, moral authority.

• Spirituality in Business is springing up all over Half speak of faith at work Eileen Fisher, Medtronic win “Spirit at Work” awards Ford, Intel and other firms sponsor employee-based religious networks Each month San Francisco’s Chamber of

employee based religious networks Each month San Francisco s Chamber of

Commerce sponsors a “spiritual” brown bag lunch.

• The Values-Driven Consumer. Conscious Consumers, who’ve fled the mass market, are a multi-billion-dollar “niche.” Whether buying hybrid cars, green building supplies

or organic food they vote with their values So brands that embody positive values will

or organic food, they vote with their values So, brands that embody positive values will attract them.

• The Wave of Conscious Solutions. Coming to a firm near you: Vision Quest

Meditation Forgiveness Training HeartMath They sound touchy-feely, but conscious

business pioneers are tracking results that will blow your socks off.

• The Socially Responsible Investment Boom Today’s stock portfolios are green in more ways than one Where should you invest?

4.1 Population and Demographics p g p

• Population growth p g • Educational groups

• Population age mix

4.2 Economic Environment

• Income Distribution Income Distribution

• Savings, Debt, and Credit

What are Personal Values?

Personal Values are:

“The things that act as the guiding principles in your life and give meaning to your life”

or

Whatever is important to you

Rene Magritte “Personal Val es”

important to you

Rene Magritte: “Personal Values”

World Top Ten Values

Top 10 Personal Values Top 10 Personal Values Top 10 Personal Values

Protecting the family

(China) Protecting the family Honesty

Health and fitness Self esteem

Stable personal relationships Social stability

Respecting ancestors Self-esteem

Self-reliance Justice

Respecting ancestors Honesty

Health and fitness Justice

Freedom Friendship

Friendship Self-reliance Knowledge

Learning

Source: Robert Report

Freedom Enjoying life

Enjoying life Having fun

Adventure

Sex Music

Open-mind Leisure

Power

Status

Tradition

Obedience Trad gend r.

Tradition

Power

Values are Grouped into Six Segments p p g g

Committed to learning and technology

Proponents of social causes and issues

Focusing on excitement, recreation, and enjoyment

Valuing faith, tradition, duty,

& respect for elders

Ambitious status conscious Concerned with family homeAmbitious, status-conscious,

power-seeking Concerned with family, home,and personal relationships

Values Map

Stab p rel Romance

p

Freedom

E lit

Stab p rel Endur love

Friendship

Pleasure

Enjoying life Having fun

Adventure

Sex

Music

Open-mind Leisure

Spirituality

Honesty Fulfill work

Courage Persever.

Knowledge Wisdom

Simplicity Youthful

Power

Status

Tradition

Obedience Trad gend r.

Diverse Cultures Seek Diverse Anchors

Taiwan

Venezuela

Mexico

Brazil USA

0

South Africa Thailand Philippines Indonesia

China Korea

Taiwan Hong Kong

Devouts on the rise in

Strivers leveling off in

China and Philippines;

but surging ahead in

Saudi Arabia Egypt India

Tradition Power

Indonesia and Thailand

but surging ahead in

India

Structure

Table 3.3 Most Popular

American Leisure Activities

4.4 Natural Environment

• Shortage of raw materialsShortage of raw materials

• Increased energy costs

A ti ll ti

• Anti-pollution pressures

• Governmental protections

See fig 3.1 p 123

4.5 Keys to Avoiding

Green Marketing Myopia

• Consumer Value Positioning

• Calibration of Consumer Knowledgeg

• Credibility of Product Claims

4.5 Technological Environment g

• Pace of changePace of change

• Opportunities for innovation

V i R&D b d t

• Varying R&D budgets

• Increased regulation of change

Macro Trend Tools

Chapter 4 Conducting Marketing Research and Forecasting Research and Forecasting

Demand

What is Marketing Research? g

Marketing research is the systematic

Marketing research is the systematic

design, collection, analysis, and reporting of data and findings relevant to epo t g o data a d d gs e eva t to

a specific marketing situation facing the

company

co p y

Types of Marketing Research Firmsyp g

• Syndicated serviceSyndicated service

• Custom

S i lt li

• Specialty-line

The Marketing Research Processg

Step 1: Define the Problem p

• Define the problem

• Specify decision alternatives

• State research objectives

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Step 2: Develop the Research Plan p p

Application of Exploratory Approaches

2.2.1 Questionnaire Do’s and Don’ts Q

• Ensure questions are • Avoid negatives

• Use response bands

• Use mutually exclusive

• Avoid sophisticated

words

• Avoid ambiguous words

• Use mutually exclusive categories

• Allow for “other” in fixed response questions

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Question Types - Dichotomous

In arranging this trip, did you contact American Airlines?

… Yes … No

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Question Types – Multiple Choice

… An organized tour group

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Question Types – Likert Scale

Indicate your level of agreement with the following

Indicate your level of agreement with the following statement: Small airlines generally give better service than large ones g

Question Types – Semantic Differential

American Airlines Large ……… …….Small Experienced……….….Inexperienced

Modern……….… Old-fashioned

Question Types – Importance Scale

Airline food service is _ to me … Extremely important

… Very important

… Somewhat important

… Not very important

… Not at all important

Question Types – Rating Scale

American Airlines’ food service is

American Airlines food service is _ … Excellent

… Very good

… Good

… Fair

… Poor

Question Types –

Intention to Buy Scaley

How likely are you to purchase tickets on American y y p Airlines if in-flight Internet access were available? … Definitely buy

… Probably buy

… Not sure

… Probably not buy

… Definitely not buy

Question Types –

Completely Unstructured

What is your opinion of American Airlines?

Question Types –

Word Association

What is the first word that comes to your mind when you

What is the first word that comes to your mind when you hear the following?

Airline

Airline

American _

Travel

Question Types –

Sentence Completion

When I choose an airline the most important

When I choose an airline, the most important

consideration in my decision is:

.

Question Types –

Picture (Empty Balloons)

2.3 Sampling Plan p g

• Sampling unit: Who is to be surveyed?

• Sample size: How many people should

be surveyed?

• Sampling procedure: How should the respondents be chosen?

Table 4.2 Types of Samplesyp p

Probability Samples Nonprobability Samples y p

Pros and Cons of Online Research

• Accuracy of data,

even for sensitive

S ewed sa p es

• Technological problems

questions

• Versatility

p

• Inconsistencies

Step 3: Collect the Information

What is a Marketing Decision Support System (MDSS)?

A marketing decision support system is a

A marketing decision support system is a

coordinated collection of data, systems,

tools and techniques with supporting

tools, and techniques with supporting

hardware and software by which an

organization gathers and interprets relevant

organization gathers and interprets relevant information from business and environment and turns it into a basis for marketing

and turns it into a basis for marketing

action

Barriers Limiting the Use of

Marketing Research

• A narrow conception of the research

• Uneven caliber of researchers

• Poor framing of the problem

• Late and occasionally erroneous findingsLate and occasionally erroneous findings

• Personality and presentational differences

Table 4.3 Characteristics of Good

What are Marketing Metrics? g

Marketing metrics are the set of

Marketing metrics are the set of

measures that helps marketers quantify,

compare, and interpret marketing

co pa e, a d te p et a et g

performance

Table 4.4 Marketing Metrics

Major Matrix j

Major Matrix j

What is Marketing-Mix Modeling? g g

Marketing-mix models g

analyze data from a

variety of sources, such as

retailer scanner data,

company shipment data,

pricing media and

pricing, media, and

promotion spending data,

Build Models of How Market Works

Sales Automation

Marketing Dashboards

• A customer-performance scorecard records

how well the company is doing year after year on

how well the company is doing year after year on customer-based measures.

• A stakeholder-performance scorecard tracks A stakeholder performance scorecard tracks

the satisfaction of various constituencies who

have a critical interest in and impact on the

company’s performance including employees,

suppliers, banks, distributors, retailers, and

stockholders.

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Dash Board Example p

Table 4.5 Sample Customer-Performance

Scorecard Measures

• % of new customers to average # % of new customers to average #

• % of lost customers to average #

• % of win-back customers to average #

• % of customers in various levels of satisfaction

• % of customers who would repurchase

• % of target market members with brand recall

• % of customers who say brand is most preferred

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Common Measurement Paths

• Customer metrics pathwayCustomer metrics pathway

• Unit metrics pathway

• Cash-flow metrics pathway

• Brand metrics pathway

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The Measures of Market Demand

• Potential marketPotential market

Vocabulary for Demand Measurement y

• Market demand (expected):

– expand vs non-expandable market;

– Market penetration index

– Company’s share penetration index

• Market forecast

• Market potential:

– Max market demand

– Product penetration

• Company demand: Company demand: is the company's estimated share of is the company s estimated share of

market demand at alternative levels of company marketing effort

in a given time period

• Company sales forecast: sales quota sales budget

• Company sales potential (vs market potential)

How Can We Estimate

Current Demand?

(i) Total market potential: Total market potential is the maximum amount of sales that might be available to all the firms in an industry during a given period, under a given level of industry y g g p g y

marketing effort and environmental conditions.

(ii) Area market potential

• Market buildup method:Market buildup method: identifying all the potential identifying all the potential buyers in each market and estimating their potential purchases.

• Multiple factor index method: i BDI (B d

• Multiple-factor index method: using BDI (Brand Development Index)

Estimating Future Demand g

• Survey of Buyers’ Intentions

• Composite of Sales Force Opinionsp p

• Expert Opinion

• Past-Sales Analysis

• Market-Test Method