chapter
15
Customer Information Systems
McGraw-Hill/Irwin
© 2004 The McGraw-Hill Companies, Inc., All Rights Reserved.
Customer Information Systems —
Today’s Objectives

Objectives will be to:

Define and understand marketing research

Explore a framework for marketing research

Examine marketing research data-collection methods

Compare how online methods differ from offline methods

Discuss what research is best suited by the Internet

Understand the implications of international Internet market research
Chapter 15: Customer Information
Systems

Understanding Marketing Research

Benefits and Uses of Marketing Research

Framework for Marketing Research

Data Collection in Marketing Research

Comparisons for Offline and Online Marketing Research Methods

Guidelines for Conducting Data Analysis and Utilization

Conclusion
Chapter 15: Customer Information
Systems

Understanding Marketing Research

Benefits and Uses of Marketing Research

Framework for Marketing Research

Data Collection in Marketing Research

Comparisons for Offline and Online Marketing Research Methods

Guidelines for Conducting Data Analysis and Utilization

Conclusion
Exhibit 15.1: Customer-Centric
Marketing Process
Marketing Research
Marketing Strategy
and Tactics
Customer Relationship
Management
Sales Force Management
and Customer Experience
Database Marketing
Acquire/Up-Sell
Cross-Sell
Exhibit 15.2: Leveraging Customer
Information
Define
Problem
Collect
Data
Organize
Data
Analyze
Data
Utilize
Data
Exhibit 15.3: Customer Information
System
Exhibit 15.4: Framework of Marketing
Research
Marketing Research
Opportunity/Problem Definition
Research Design
Data Collection and Entry
Data Analysis
Final Report/Data Utilization
Exhibit 15.5: What Is Marketing
Research?
Target Market
Marketing Research
Customer
Identification
Market Opportunities
Marketer
Definition
Public
Market Problems
Action
Consumer
Marketing Research Objectives
Marketing Research Attempts to Perform Three Basic Tasks:
Description
Marketing
Research
Diagnosis
Prediction
Chapter 15: Customer Information
Systems

Understanding Marketing Research

Benefits and Uses of Marketing Research

Framework for Marketing Research

Data Collection in Marketing Research

Comparisons for Offline and Online Marketing Research Methods

Guidelines for Conducting Data Analysis and Utilization

Conclusion
Benefits of Marketing Research
Improve the quality of decision-making
Guide communications with current and potential customers
Identify potential opportunities in the marketplace
Minimize business risk by uncovering prospective problems
Create benchmarks and track progress
Evaluate overall success
Many more…
Benefits of Internet Marketing
Research
Quickly gain crucial market intelligence
Act upon first-mover advantages
Stay afloat in a fast-paced environment
Reduce market research costs
Many more…
Exhibit 15.6: Popular Uses of Marketing
Research
How to
segment
the market?
Who are my
customers?
What is
the price
elasticity?
Conjoint
Analysis
Customer
Identification
When
do they
purchase?
Discrete Choice
Modeling
Marketing
Research
Buying-Habit
Studies
Opinion
Research
What do
they like?
Environmental
Studies
Competitive
Analysis
Who are my
competitors?
What are
the growth
trends?
Chapter 15: Customer Information
Systems

Understanding Marketing Research

Benefits and Uses of Marketing Research

Framework for Marketing Research

Data Collection in Marketing Research

Comparisons for Offline and Online Marketing Research Methods

Guidelines for Conducting Data Analysis and Utilization

Conclusion
Exhibit 15.7: Opportunity/Problem
Definition
“Market
Research on
Internet Habits
of Teenagers”
Project Title
“Teenagers
Make Up a
Large Portion
of the Market”
Statement of Marketing
Problem/Opportunity
Identify the
Characteristics
of Webpages
Teenagers Visit
Ex.: What Sites
Do Teenagers
Visit Most?
Project Objective(s)
Questions That the Study
Attempts to Answer
Exhibit 15.8: Deciding on a Research
Design Type
Study Type
Exploratory Research
Why?
How?
When?
Conclusive Research
Causal
Research
Descriptive
Research
What
Causes
What?
Who,
What,
When,
Where?
How
Often?
How
Many?
Exhibit 15.9: Types of Marketing
Research Data
Information
Previously Collected
and Published
Secondary Research
Ex.: Library Search
Information Gleaned
by a Researcher for a
Specific Purpose
Primary Research
Ex.: Interview
Information About the
Motivations,
Perceptions and
Thoughts of a Group
Qualitative Research
Ex.: Focus Groups
Information About
How Many People in a
Population Share a
Set of Characteristics
Quantitative Research
Ex.: Interview
Population Sampling
Desired
Accuracy?
How Many
Subjects?
Random
Selection —
Equal Impact on
Study Result?
Representative
Sample
Exhibit 15.10: Guidelines for Using
the Internet for Marketing Research
Can a sufficiently representative
sample be drawn?
Yes
No
Can confidentiality be assured?
Yes
No
Can answers be obtained
via simple surveys?
Yes
Internet Marketing
Research
No
Traditional Marketing Research
Chapter 15: Customer Information
Systems

Understanding Marketing Research

Benefits and Uses of Marketing Research

Framework for Marketing Research

Data Collection in Marketing Research

Comparisons for Offline and Online Marketing Research Methods

Guidelines for Conducting Data Analysis and Utilization

Conclusion
Exhibit 15.11: Marketing Research
Data-Collection Methods
Data-Collection Methods
Offline Methods
Secondary

Colleges,
universities,
libraries

Books,
publications

Magazines,
newspapers

Marketing
departments

Others
Online Methods
Primary
Secondary
Primary

Focus groups

Search engines

Questionnaires

Surveys

Newsgroups


Observations

Directories
Discussion
groups

Click data
Exhibit 15.12: Questionnaire Types
Questionnaires
Flat File Instruments
Interactive
Instruments
E-Mail Integrated
Questionnaires
Simple,
Non-Interactive
Survey
Simple,
Interactive
Survey
E-Mail Survey
or Delivery Tool
Exhibit 15.13: Survey Questions
Survey Questions
How Old
Are You?
Single-Response
Questions
Are You Male
or Female?
DichotomousResponse
Questions
In Which
of the Following
Income Ranges
Do You Fall?
MultichotomousResponse
Questions
Scaled
Questions
PairedComparison
Tradeoff
Open-Ended
Questions
In 100 Words or
Less, Describe Your
Experience With
This Product
What Would You
Prefer — a Porsche
or a Ferrari?
On a Scale of
1 to 10, How
Happy Are You?
Internet Compatibility
High
Low
Chapter 15: Customer Information
Systems

Understanding Marketing Research

Benefits and Uses of Marketing Research

Framework for Marketing Research

Data Collection in Marketing Research

Comparisons for Offline and Online Marketing Research Methods

Guidelines for Conducting Data Analysis and Utilization

Conclusion
Exhibit 15.14: Comparison of Offline &
Online Marketing Research Methods
Decision Factor
Offline Method
Online Method
Cost
High
Low
Turnaround Time
Slow
Quick
Labor-Intensive
Labor-Nonintensive
Medium
High
High
Low
Accurate
Inaccurate
Controllable
High to Uncontrollable**
Limited
Unlimited
High
Low
Limited
Unlimited
High to Medium
Low
Low
High
Effort
Data Quality*
Researcher Control
Sampling
Sample-selection Bias
Delivery/Illustration
Interviewer Bias
Geographical Coverage
Anonymity guarantee
Ethical Issues (privacy)
* Quality of data is defined here as ease and timeliness of data collection and entry.
** As the Internet becomes ubiquitous, this issue is becoming less important.
Chapter 15: Customer Information
Systems

Understanding Marketing Research

Benefits and Uses of Marketing Research

Framework for Marketing Research

Data Collection in Marketing Research

Comparisons for Offline and Online Marketing Research Methods

Guidelines for Conducting Data Analysis and Utilization

Conclusion
Exhibit 15.15: Data Analysis
Data Analysis Procedures
Basic
Statistics

Frequency
tables

Cross-tabulation

Graphic
representation

Descriptive
Statistics
Inferential
Statistics

Mean

T-test

Standard
deviation

Correlation

Median

Inter-quartile
range
Others

Mode

Range
Complexity
Econometric
Analysis

Linear
regression

Nonlinear
regression

Logit modeling

Clustering
analysis

Turf analysis

Logistic
regression
Validation
Internal Validation:
What happens to
my results if I change
one study parameter?
External Validation:
How does my study
compare to actual data
or other studies?
Validation:
Are my results
realistic?
Exhibit 15.16: Database Marketing
Program Plan
I.
II.
Marketing objectives
Market analysis
A. Customer analysis and segmentation
B. Competition
C. Environment
III.
Offer and market fit
IV. Assessment of performance with similar programs
V.
Communication strategy
A. Targeting and positioning
B. Unique selling proposition
C. Media and list decisions
D. Message strategy
VI. Database requirements
A. Development
B. Utilization
C. Enhancement
VII. Program budget
VIII. Timeline
IX. Accountability
Exhibit 15.18: Provider-Consumer
Interaction Matrix
Chapter 15: Customer Information
Systems

Understanding Marketing Research

Benefits and Uses of Marketing Research

Framework for Marketing Research

Data Collection in Marketing Research

Comparisons for Offline and Online Marketing Research Methods

Guidelines for Conducting Data Analysis and Utilization

Conclusion
Customer Information Systems —
Conclusion

A general marketing research framework involves the following seven
steps: 1) opportunity or problem definition, 2) research design, 3) data
collection and entry, 4) data analysis, and 5) final report and data
utilization

Offline marketing research methods are generally reliable but
expensive and labor-intensive. Online methods significantly reduce
the turnaround time and cost, but it may be difficult to draw a random
and representative sample.

Internet-based marketing research works best when:

A representative sample can be drawn from the population

There is no issue with confidentiality of the data

The topic is sufficiently straightforward that it can be communicated via a
short, relatively simple survey