CHAPTER 8
MARKET INFORMATION AND RESEARCH
CHAPTER OBJECTIVES
1. To provide an understanding of marketing information systems
(MkIS).
2. To examine a variety of secondary and primary data approaches to
researching markets.
3. To explore the environmental scanning methods involved with
marketing intelligence provision and examples of the dynamic nature
of the marketing environment.
4. To extend traditional coverage of market research into the
contemporary areas of market productivity analysis and marketing
models, as provided and facilitated, especially, by technological
developments in marketing, notably the marketing database.
5. To explore some of the emerging ethical issues concerning
information and research for marketing.
CHAPTER SUMMARY
This chapter looks at the marketing information system. It begins by
looking at the steps in the marketing research process. It then discusses
marketing intelligence including such issues as environmental scanning.
This is followed by an investigation of marketing productivity analysis
and marketing modelling and concludes by looking into possible key
issues in the future.
ANNOTATED LECTURE OUTLINE
Point 1 - Introduction.
The marketing information system (MkIS) can contain many different
sources and types of information that are needed in order to make
marketing decisions. As well as the data there are functional aspects of
the MkIS in terms of its role in support of information gathering,
evaluation, processing, dissemination, analysis, and control. Marketing
intelligence is more concerned with longer-term marketing planning.
Point 2 - Marketing research.
Marketing research is a key element of the MkIS and is concerned with
the provision of information about markets and their reaction to
marketing strategy. It is research about a specific problem not just the
collection of data per se. Marketing research is systematic and
formalized and there is a sequence of research events or stages known as
the research process. (Box 8.2 pp153)
Point 3 - Marketing intelligence.
Marketing intelligence is concerned with the wider, external information
available from the marketing environment.
It is less focused than
marketing research and is concerned with less immediate decisionmaking. If an organization is to anticipate customer requirements
profitably then a degree of forecasting is required in order to plan ahead.
Environmental scanning is seen as an early warning system for
environmental forces (Jain 1981) which enable an organization to act
rather than react to opportunities and threats and is, therefore, long-term.
Techniques for scanning involve a six stage approach.
Point 4 - Marketing productivity analysis.
Marketing productivity analysis involves the use of internal information
that is readily available to quantify marketing inputs and outputs, e.g.
measuring the response to an advertising campaign in terms of increased
sales. A new method of data collection in this area is transactional data
which has led to more sophisticated and better targeted database
marketing.
Point 5 - Marketing modelling.
The putting together of profile and transaction data has led to the
development of biographics allowing companies to build an individual
profile of someone’s life and this it is thought will be the basis of
marketing modelling in the next few years.
Point 6 - The future.
As marketing moves more towards direct and database approaches it is
felt that greater emphasis will be placed on behavioural response rather
than attitudinal measures and that issues of privacy need to be addressed.
Point 7 - Conclusion.
As can be seen today’s MkIS is concerned with many areas of data
collection. In addition to marketing research the scanning of the
marketing environment is becoming increasingly important as is customer
specific database marketing, the development of which is also giving rise
to ethical concerns.
Answers to the discussion questions:1. Here the discussion revolves around the Chartered Institute of
Marketing’s definition of marketing and the fact that marketing
research helps identify customer requirements and marketing
intelligence helps in anticipating them. A discussion of how these
information sources help with the decision-making process would be
useful also.
2. Analysis of the six stages of the research process is required and
students should be encouraged to identify what errors or bias can
occur at each stage.
3. This information can then be presented to the rest of the group.
4. Consumer panels, a form of primary research, where consumers report
their buying behaviour over a period of time. They look at the type of
products bought and the frequency, etc. Retail audits, also continuous,
are primary research, and allow sales by type of retail outlet to be
analysed. They can also track distribution patterns, pricing and sales
promotion activity including that of competitors.
5. Bayesian Analysis helps, by the use of probability theory, to estimate
the value of decisions made without research information, compared
with decisions made with information derived from different types of
research design thus enabling the cost effectiveness of the research to
be determined.
6. With observation there is little control over what is being studied. It is
highly objective because actual behaviour is recorded as opposed to
what the researcher thinks. Interviewing is more subjective although
it depends upon the method being used. The more structured the
interview the less subjective it is.
7. Group discussions are often used in conjunction with large-scale
sample surveys to provide qualitative data. They can explore attitude
and behavioural issues in much great depth.
8. Testing is a far more mechanical approach to analysing the success or
otherwise of a direct marketing campaign. However, what it ignores
is the attitude of consumers to the campaign which can only be
determined through research.
9. a) This could be done by a systematic random sample where every nth
consumers can be selected, or a stratified sample could be used. b)
Quota methods are where relevant characteristics of the target market
are accounted for in the sample. The sample should, therefore,
represent the target market as a whole.
10. Students should be guided towards the six stage framework for
environmental scanning given in the text (pp168).
11. Here Figure 8.4 (pp170) can be used as the basis for the discussion.
a) It allows the production of league tables of types of customers for
targeting purposes. b) It will take marketing modelling one step
further to allow the modelling of individual buying behaviour.
12. Students will probably have some fairly strong views both for and
against this argument! It can also lead to a discussion of how the
industry should be controlled.
MINI CASE
Buy a car - and provide the marketer with a wealth of market
information.
4HEDISCUSSIONHEREWILLREVOLVEAROUNDSOURCESOFSECONDARYDATA-INTEL
AND+EY.OTEREPORTSMAYGIVEINFORMATIONONTHECARMARKETANDOUTLINE
THEKEYCHANGESINBUYINGBEHAVIOURANDMARKETTRENDS2ELEVANTTRADE
ASSOCIATIONSMAYALSOHAVEINFORMATIONTHATMIGHTBEUSEFUL)NADDITION
THE)NTERNETMAYPROVIDETHECARDEALERWITHSOMEINTERESTINGINFORMATION