BBUS 320 - Chapter 4 - Managing Marketing Information

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Marketing ManagementBBUS 320

Spring, 2014Ceri M. Nishihara

[email protected]

HH 1312


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Managing MarketingInformation To Gain

Customer Insights

Chapter 4


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Rest 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

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Rest Stop: Previewing the Concepts

Explain how companies analyze and use

marketing information

Discuss the special issues some marketing

researchers face, including public policy and

ethics issues

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First Stop: DominosPizza

Declining revenues prompt Dominos to ask

customers for honest feedback

Gains insights from social media and focus

groups

Discovers that main problem is taste

Reinvents its product, launches PizzaTurnaround campaign

ResultIncreased sales and profits

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http://www.youtube.com/watch?v=AH5R56jILaghttp://www.youtube.com/watch?v=AH5R56jILag


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Marketing Information and CustomerInsights

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

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Fresh understandings of

customers and the marketplace

derived from marketing

information that becomes the

basis for creating customer value

and relationships

Customer insights


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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 insights

Marketing informationsystem


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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 cost

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Electronic collections of consumer and market

information obtained from data sources

within the company network

Internal databases


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Internal Data

Can be accessedmore quickly andcheaply than other

information sources Ages rapidly and may

be incomplete

Maintenance andstorage of data isexpensive

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Financial services provider USAA uses its

extensive database to tailor its services

to the specific needs of individual

customers, creating incredible loyalty


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The systematic collection and analysis of

publicly available information about

consumers, competitors, and developments

in the marketing environment

Competitive marketing

intelligence


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Competitive Marketing Intelligence

Techniques include:

Observing consumers

Quizzing the companys own employees

Benchmarking competitors products

Monitoring Internet buzz

Actively monitoring competitors activities

Companies also take steps to protect their

own information


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The systematic design, collection,analysis, and reporting of data

relevant to a specific marketing

situation facing an organization

Marketing research


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Figure 4.2 - The Marketing ResearchProcess

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Defining the Problem and Research

Objectives

Exploratoryresearch

Gatheringpreliminary

informationthat will help

define the

problem andsuggest

hypotheses

Descriptiveresearch

Generatinginformation to

betterdescribe

marketing

problems,situations, or

markets

Causal research

Testinghypotheses

about cause-and-effect

relationships

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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)

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Information that already exists

somewhere, having been collected for

another purpose

Secondary data


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Secondary Data

Common sources of secondary data:

Internal company databases

Commercial online databases

Internet search engines

Cheaper to obtain than primary data

Can be collected faster than primary data

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Information collected for the

specific purpose at hand

Primary data


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Primary Data

Designing a primary data collection plan

involves making decisions about:

The research approach

Observation, survey, or experiment

Contact methods

Mail, telephone, personal, or online

The sampling plan Sampling unit, sample size, and sampling procedure

Research instruments

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Gathering primary data by observing relevant

people, actions, and situations

Observational research

A form of observational research that involvessending trained observers to watch and interact

with consumers in their natural environments

Ethnographic research


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Observational Research

Can obtain information that people are

unwilling or unable to provide

Cannot be used to observe feelings, attitudes,

and motives, and long-term or infrequent

behaviors

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Marketing at Work

By entering the

customers world,

ethnographers can

scrutinize howcustomers think and

feel as it relates to

their products

To better understand the challenges

faced by elderly shoppers, thisKimberly-Clark executive tries to

shop while wearing vision-

impairment glasses and bulky gloves

that simulate arthritis


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Gathering primary data by askingpeople questions about their

knowledge, attitudes, preferences,

and buying behavior

Survey research


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Gathering primary data by

selecting matched groups ofsubjects, giving them different

treatments, controlling related

factors, and checking for

differences in group responses

Experimental research


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Contact MethodsMail Questionnaires

Pros

Large amounts of information at a relatively low

cost per respondent

Enables more honest responses than interviews

Absence of interviewer bias

Cons

Inflexible, low response rate

Researcher has little control over sample

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Contact Methods - Telephone Interviewing

Pros

Gathers information fast, high response rate

Allows greater flexibility than mail surveys

Strong sample control

Cons

Higher costs than mail questionnaires

Interviewer may bias results

Limited quantity of data can be collected

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Contact MethodsPersonal Interviewing

Pros

Highly flexible method that can gather a great deal

of data from a respondent

Good control of sample, speed of data collection,

and response rate

Cons

High cost per respondent

Subject to interviewer bias

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Focus Groups

Involve inviting six to

ten people to gather

for a few hours with

a trained interviewerto talk about a

product, service, or

organizationLexus general manager Mark

Templin hosts An Evening with

Lexus dinners with luxury car

buyers to figure out why they did

or didnt become Lexus owners


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Collecting primary data online through

Internet surveys, online focus groups,

Web-based experiments, or tracking

consumers online behavior

Online marketing research


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Contact MethodsOnline Marketing

Research

Pros

Speed and low costs

Lowest cost per respondent of all contact

methods; offers excellent sample control

Good flexibility and response rate due to

interactivity

Cons Difficulty in controlling sample

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A segment of the population selected

for marketing research to represent the

population as a whole

Sample

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Sampling Plan

Sampling requires three decisions:

Who is to be studied (sampling unit)

How many people should be included (sample

size)

How should the people in the sample be chosen

(sampling procedure)

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Each population member has a known chanceof being included in the sampleProbabilitysample

Simple random sample

Stratified random sample

Cluster (area) sample

Sampling error cannot be measured

Nonprobability

sample

Convenience sample Judgment sample

Quota sample


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Research Instruments

Questionnaires

Closed-end questions include all the possible

answers, and subjects make choices among them

Open-end questions allow respondents to answerin their own words

Mechanical devices

People meters, checkout scanners,neuromarketing

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Implementing the Research Plan

Collecting the data Most expensive phase

Subject to error

Processing the data Check for accuracy

Code for analysis

Analyzing the data Tabulate results Compute statistical

measures

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Interpreting and Reporting Findings

Interpret the findings

Draw conclusions

Report to management

Present findings and conclusions that will be most

helpful to decision making

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Customer Relationship Management(CRM)

Managing detailed information about

individual customers and carefully managing

customer touch points to maximize customer

loyalty

Helps firms offer better customer service

Helps identify high-value customers

Enhances the firms ability to cross-sell productsand develop offers tailored to customers

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Public Policy and Ethics in MarketingResearch

Intrusions on consumer privacy The Marketing Research Associations Your

Opinion Counts and Respondent Bill of Rights

initiatives Adopting standards that outline researchers

responsibilities to respondents

Misuse of research findings

Development of codes of research ethics and

standards of conduct

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Documents

BBUS 320 - Chapter 4 - Managing Marketing Information