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Marketing Information Systems: Glossary
Marketing Information Systems: Glossary
Robert R. Harmon
Portland State University
Implementation Competitors
Distributing Publics
Marketing
MDSS
Control Information research
Macro-
environmental
forces
Figure 1 The marketing information system. From Marketing Management: Analysis, Planning, Implementation, and
Control, 9th edition by Kotler, Philip © 1997. Reprinted by permission of Pearson Education, Inc, Upper Saddler River, NJ.
environment for changes in buyer behavior, marketing activities. However, it is the recent
competition, technology, economic conditions, advent of the Internet, and especially the browser-
and government policies. Marketing is a based World Wide Web, which has ignited a
“strategic” function in that marketing activities revolution in MkISs.
enable organizations to identify and adapt to The term “cybermarketing” is often used to
changes in the market environment. describe the Internet’s convergence of computers,
The strategic function of marketing is information systems, telecommunications and the
further emphasized as Internet-based technologies customer with the marketing process. Internet
have enabled radically new approaches to selling marketing is characterized by interactivity,
where information technology for the first time graphical user interfaces, multimedia content, and
touches customers and provides new means for one-to-one connectivity. Internet technologies are
collecting marketing information. In a not only providing new ways to reach the
knowledge-intensive economy, the ability to customer, but also to enable the reengineering of
collect, analyze and act upon marketing the entire marketing process and, indeed, the
information more rapidly than the competition is entire enterprise. It is no longer acceptable to
the core competency from which competitive view marketing as a standalone activity with
advantage flows. Marketing information systems lengthy time lapses between product concept,
provide the information technology backbone for marketing strategy and commercialization.
the marketing organization’s strategic operations. Marketing has become interactive and real time.
In a broader sense, the MkIS creates an organized The rapidly growing field of marketing
and timely flow of information required by automation encompasses customer management
marketing decision makers. It involves the functions to support e-commerce. As depicted in
equipment, software, databases, and also the Figure 2, customer management applications
procedures, methodologies and people necessary include marketing decision support systems,
for the system to meet its organizational customer relationship management, sales force
objectives. MkIS encompasses a broad spectrum automation, customer service and e-commerce
of activities from simple transaction processing activities. These activities are often described as
complex marketing strategy decision making. “front office” customer-oriented activities. “Back
office” enterprise resource planning (ERP)
C. The Role of the Internet activities include manufacturing, finance and
human resources. “Supply chain management”
Information technology has transformed how (SCM) activities encompass electronic
firms conduct business. For example, financial procurement, inventory management, quality
service providers such as banks, stockbrokers and management and logistics systems to link an
insurance companies could not do business today organization with its suppliers. These three
without their client-server-based information elements comprise the enterprise information
technology. This technology has long supported system.
Enterprise Marketing
Supply Chain
Back Office Front Office
Large integrated enterprise software activities the MkIS can enable the
companies such as Oracle, SAP, PeopleSoft, and identification of emerging market segments,
IBM address all three major applications and they and the monitoring of the market environment
are beginning to use Web-based technologies to for changes in consumer behavior, competitor
redesign business processes throughout the activities, new technologies, economic
organization. The result is leaner organizations, conditions and governmental policies. Market
faster response times, and lower costs. Decision- research is situational in nature and focuses on
makers are able to integrate information from specific strategic or tactical marketing
customers, suppliers, and the internal organization initiatives. Marketing intelligence is
to obtain an enterprise-wide view of their ability continuous in nature and involves monitoring
to develop and execute marketing strategy. Until and analyzing a broad range of market-based
truly integrated browser-based systems are widely activities and information sources. There are
in use, the principal challenge for marketers is to three major sources of market information.
tie e-commerce generated data with legacy The first is syndicated data published by
information systems in order to create a unified market research companies and industry
view of each customer. Marketers will need to associations. Company-sponsored primary
understand all the various ways that customers are research is another option. It is much more
touching the business through existing interfaces focused since you ask specific questions of
and e-commerce. Many of the older interfaces, respondents within your markets. But, it is
such as telemarketing centers, point of sale (POS) considerably more expensive and time
systems, and the sales force are likely to be consuming. Perhaps the best data available
supported by legacy client-server technology. are your own customer’s behavior captured
Marketers need to consolidate data from those from web site viewing, point of sale (POS)
systems with that from the Web-based e- transactions, and systematic feed back from
commerce sources into a holistic view of the the sales force.
customer and make it available to decision- 2. Strategy Development. The MkIS provides the
makers. information necessary to develop marketing
strategy. It supports strategy development for
D. Benefits of the Marketing new products, product positioning, marketing
Information System communications (advertising, public relations,
and sales promotion), pricing, personal
The MkIS increases the number of options selling, distribution, customer service and
available to decision-makers and supports every partnerships and alliances. The MkIS
element of marketing strategy. MkIS affects provides the foundation for the development
marketing’s interfaces with customers, suppliers information system-dependent e-commerce
and other partners. The primary benefits of the strategies.
MkIS impact in the areas of functional integration, 3. Strategy Implementation. The MkIS provides
market monitoring, strategy development, and support for product launches, enables the
strategy implementation. coordination of marketing strategies, and is an
integral part of sales force automation (SFA),
1. Market Monitoring. Through the use of customer relationship management (CRM),
market research and marketing intelligence and customer service systems
A. Sales Force Automation The typical field sales process consists of a series
of steps that are designed to lead to a sale. The
SFA is a customer management tool that is one of typical role of the MkIS is to support the sales
the fastest growing elements of the MkIS. SFA process steps of lead generation, sales process
applications are often integrated with the CRM management, and account management.
system. SFA involves the application of 1. Lead generation. Leads represent potential
information technology to the sales function or, customers. The identification of a lead is the
more appropriately, to the activities leading to a beginning of the sales cycle. After leads are
sale. These activities include acquiring sales identified, they must be qualified. This
leads, managing the sales opportunity, closing the process involves gathering information about
sale and managing the customer relationship. the lead and comparing the result against
The historic role of personal selling has been qualifying criteria. The lead generation
to move the product—to generate transactions. As process is becoming more automated with
selling has become increasingly more regard to obtaining more pre-qualifying
professional, sales people emphasize building information directly from the lead and
relationships with customers that will generate augmenting it from commercial and other
loyalty-based repeat transactions over time. databases such as credit bureaus. The advent
Relationship building often necessitates that the of Web-based technologies is driving this
sales person has consultative and advisory skills trend. Qualified leads are then distributed to
in addition to product knowledge and sales the sales force.
abilities. Team-based selling places emphasis on 2. Sales Process Management. This process
role specialization, collaboration and starts when the sales person receives the lead
coordination. Customers have become more information. The primary information system
sophisticated as well. Requirements for need is for a convenient method to track the
customized solutions, rapid response times and process and store data the data generated at
the need for concurrent and post-sale service have each stage. There are a number of sub-steps
greatly increased the need for information to this stage of the process.
technology in the sales process. a. Verification of the opportunity. The sales
The goals of SFA are to increase the person usually contacts the lead and
effectiveness of the sales organization, improve its attempts to verify the existence and nature
efficiency and to create superior value for the of an opportunity including its size,
customer. Sales effectiveness focuses on getting timing, and appropriateness of the
the sale by improving lead generation, qualifying products and services of the selling
prospects, coordinating sales efforts, and tracking company. Sales people will also desire to
commitments. Effectiveness is a function of verify the lead’s ability to purchase,
improving the sales process. Sales efficiency is identify the names of key decision-makers
evaluated by measuring the return on sales efforts. and influencers, and the level of budget
BIBLIOGRAPHY
Berry, M. J. A. and Linoff, G. (1997). Data Mining
Techniques for Marketing, Sales and Customer
Support, New York: Wiley.
Bidgoli, H. (1997). Modern Information Systems for
Managers, San Diego: Academic Press.