Topic 3

MARKETING INFORMATION SYSTEM

AND MARKETING RESEARCH
 Definitions
— Marketing research is defined as — A marketing information system
“the systematic gathering (MKIS)
“Consists of people, equipment,
recording and analyzing of and procedures used to gather,
data about problems, sort, analyze, evaluate and
relating to the marketing of distribute needed, timely and
goods and services”. accurate information to
marketing decision makers”

MARKETING INFORMATION
SYSTEM (MKIS)
MARKETING RESEARCH
 Definitions

— MARKETING INTELLIGENCE
— A marketing intelligence system gathers, analyzes
and distributes information about the company’s
competitive, technological, customer, economic,
social and political and regulatory environment.

— The goal of marketing intelligence system is to;

¡ improve strategic decision-making
¡ assess and track competitors’ actions,
¡ provide early warning of opportunities and
threats.
 Types Of Marketing Research
— new products acceptance • Price research
Analysis of elasticity’s of
— studies comparing competitors demand
products
— packaging and design of • The effect of changes in
products studies credit policy on demand
— Product Forecasting studies
— Test marketing studies • Customer perception of
price (and quality)

Product research
 Types of Marketing Research
— Research on advertising and sales
promotion effectiveness
— Study on effectiveness of aspects of
advertising such as copy and media
used
— Effectiveness of salesmen
— Effectiveness of other sales
promotion methods
p promotion research
— The location and design of
distribution outlet
— Analysis for transportation
methods
— middlemen supply requirements
— The cost of different methods of
transportation and
warehousing.
Distribution research
— Analysis of the market potential
— Forecasting likely demand for new and existing
products
— Study of the characteristics of the market
— Analysis of market shares
— Establishing market segments
— EXAMPLES OF
MARKET RESEARCH STUDIES
 Marketing Information Systems
process
• STEP 1: assessing information needs.
This is done by interviewing managers to find out
what information they require and also
monitoring the marketing environment in order
to provide decision makers with information.
 Marketing Information Systems
process

• STEP 2: Gathering information Needed Secondly

the marketing information system develop the
needed marketing information by gathering it
through various sources

• There are three sources from which the

needed information can be developed.
 Sources of MKIS Data
I) Internal Data
— Information from internal databases can come
from may sources such as:
a) Accounting department financial statements
and detailed sales, costs and cash flow
statements
b) Production department operation reports on
production schedules, shipments and
inventories
 Sources of MKIS Data

c) Sales department in forms of sales force reports

on resellers reactions and competitors activities.

d)The marketing department provides information

on customer demographics, psychographics and
buying behaviour.
 Sources of MKIS Data

e)Customer service department provide

information of customer satisfaction or service
problems.

f) Research done for any department is also useful

source of information.
 Sources of MKIS Data

Advantages of internal data

(i)It can be accessed more quickly and cheaply than
any other information sources.
Disadvantages
• Because internal information was collected for
other purposes, it may be incomplete or obsolete
for making marketing decision.
 Sources of MKIS Data

Disadvantages of internal data

• The data may be in wrong format-for example,
sales and cost data used by accounting
department for preparing financial statements
must be adapted for use in marketing
department
 Sources of MKIS Data
Disadvantages of internal sources of data continued
• Companies produces mountains of information
which must be well integrated and readily
accessible so that managers can find it easily.
However, this integration may be difficult to
achieve for most firms.
 (II) Marketing Intelligence
There several techniques used by organizations to collect
marketing intelligence related information.
They include: -
— Collecting information from competitors employees, such as
engineers, purchasing agents and sales force.

— The company can obtain intelligence information from

suppliers, resellers and key customers.
—
— Observing competitors action- advertisements.
• Buying and analyzing competitors products.

• Monitoring competitors sales.

• Going through competitors garbage’s which is
legally considered abandoned property once it
leaves the company premises.

• Going through competitors annual reports,

business publications, trade shows exhibits,
press releases, advertisements and web pages.
 Marketing Research

• Marketing research is the systematic design,

collection analysis and reporting of data
relevant to a specific marketing situation facing
an organization.
 Marketing Research Process
1. Definition of the problem
2. Determine the research design
3. Determine of population of study
4. Selection of sample
5. Collection of data/Field Work
6. Analysis of the data and interpretation of
results
7. Report writing
 Competitive Analysis
• Who are your competitors?
• Do you know about your close competitors’
strengths and weaknesses?
• How detail should we analyze the competition?
– Use a systematic approach
– Analysis competition at various levels (next slide)

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 Levels of Competition
Generic Competition

Form Competition

Industry Competition

Brand Competition

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 Levels of Competition (cont’d)
• Generic competition—e.g. Honda against Silver
Sea Cruise for the same consumer dollars
• Form competition—e.g. Toyota against
manufacturers of other vehicles that provide the
same service such as Yamaha (motorcycle)
• Industry competition—e.g. Honda against
Mercedes, Lexus etc who make the same
products or class of products (different prices)
• Brand competition—e.g. Honda against Toyota,
Nissan etc. who offer similar products and service
to the same customers at similar prices

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 Industry Competition

• Different industries can sustain different

levels of profitability; partly due to the
difference in industry structure
• Porter’s Model of Industry Competition,
commonly know as Porter’s Five Forces
provides a framework for analyzing the
influence of the forces on the industry to
determine the industry’s profitability and
competitiveness
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 Competition (cont...)

• Companies face competition from three

main sources:
– Brand—from manufacturers of similar
products.
– Substitute products—dissimilar products
satisfying the same needs.
– Indirect—other firms trying to win customers
purchasing power.

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 Competition (cont...)
• Increasing pressures of international
competition
– competitors often enjoy the benefits of lower
wages, better productivity or favourable exchange
rates
• Activity in world markets
– firms opt to expand to overseas markets.

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 Competition (cont...)

• A marketing program is influenced by four

types of competitive structures.
– Pure competition.
– Monopolistic Competition.
– Oligopoly.
– Monopoly.

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 Pure competition

• A market structure where a large

number of sellers sell an
undifferentiated product.
• Pure competition is rarely, if ever,
attained in the real world. It is a
theoretical concept. An ideal.
• eg: some agricultural products
(fruits, etc)
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 Monopolistic Competition
• Marketers attempt to gain differential
advantage over its competitors.
• Marketer aims to get the buyer to perceive an
attractive difference in their offerings.
• Marketers have more control over products
and price due to perceived differences.

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 Oligopoly
• A market structure in which only a few large
sellers, marketing essentially similar
products, account for almost all of an
industry’s sales.
• eg air travel, beer,
cigarettes.

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 Monopoly
• A market structure where there is only one
supplier of a product, for which there no close
substitutes.
• eg: CSR (sugar refining), electricity and gas
suppliers (usually government owned).
• monopolies are becoming rare in Australia (eg:
even Telstra now has competition).
• sometimes patent protection can provide firms
with something close to a monopoly.

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 Monitoring the environment
• Marketing intelligence
– Monitor business trends and, new developments.
– Study population growth models (ABS).
– Review of government publications, industry
periodicals, news releases.
– Attending conferences and exhibitions.

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 The firm’s entire environment and marketing
program

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 SUMMARY

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