Marketing information

The two elements of collecting and using information are:

1. Marketing information – effective marketing decision-making is impossible without the availability of reliable, up-to-date, appropriate information.

2. Market sensing – the emphasis in the area of marketing information should be on the interpretation.

Marketing decisions are concerned with the application of organizational capability to the creation of customer satisfaction in a constantly changing environment. The system must be capable of delivering information about the organization (strengths and weaknesses), the market (structure, competition etc.), the things that influence it (economic forces, competitor actions etc.) and customers (needs, profiles etc.) both actual and potential.

Sources of information

There are three major sources of data:

1. Internal data, which is generated by the organization as a result of trading.

2. External primary data which is gathered directly by or for the organization.

3. External secondary data, which is published already.

Internal data

Information technology captures real–time data at every stage of trading, and most organizations have access to large quantities of marketing data. However, they may not be able to use it if their IT systems are specified to facilitate business transactions but not to gather or analyze the data. Careful specification of information needs can help to ensure that the best use is made of the data available.

Sources of data generated within the company include:

• sales reports

• opportunity and prospect monitoring

• customer purchase records

• customer complaints

• charge and loyalty card accounts

• employee surveys

• inventory records

• accounting and, finance reports

Information gathered in this way can be used to assess customer profitability, measure the productivity of marketing effort (for example, sales conversion rates) and identify customer buying patterns and customer payment profiles.

External primary data

Primary data is data gathered specifically for the organization and analyzed for the first time. Primary research can be carried out in a variety of ways and it is important to select the appropriate methodology.

Original marketing research can be commissioned to provide information about customers in the following areas:

• usage behavior (i.e. how the products are used)

• motivation and attitudes

• responses to company initiatives

• process requirements in terms of purchaser search activity etc.

• levels of satisfaction and comparisons with competitors

• customer behavior and decision processes

• sources of information used

• attitudes to prices

• reaction to new product ideas

• pre-testing promotions

• measuring the performance of front line staff

External secondary data

There are many market research topics for which secondary data offer valuable information. Desk research may provide all the necessary data at a modest cost or help to determine the scope of primary research projects. Topics include broad scale issues such as market definition, market size estimation, geographical effects, spending patterns, competitor analysis and initial segmentation.

Sources of external data include:

• census data

• government publications

• trade publications

• professional journals

• published industry data

• customer surveys

• test markets

• commercial research companies

• competitors

Since the data is already available, it is important to confirm its relevance and reliability. Checks should be made on the original source of the data (to ensure that it is totally objective), the data collection and analysis techniques, and the age of the data.

Exercise 9. Read the text once again and express the contents of every passage in one sentence.

Exercise 10. Fill in the gaps in this passage with the words under the line; learn the new words to expand vocabulary on the topic.