Chapter 5
Understanding
Markets, Market
Demand, and the
Marketing
Environment
PowerPoint by Yu Hongyan
Business School of Jilin University
What Types of Decisions
Do Marketers Make?
Example: Restaurant to be located in
the Qianjin Square (location decision)
 Here are some marketing decisions we
need to make
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Target options- JLU; shopper OR Tourists
Menu – Breakfast; Lunch; Dinner; AND/OR
Late Night
Sit down OR fast food (or takeout/delivery)
Prices – Super Cheap, Cheap, Average,
High, OR Super High
How to advertise?
Objectives
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Marketing Information System
Demand measurement and forecasting
Microenvironmental Trends and Forces
Marketing Information System
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It is defined as . . .
“people, equipment, and procedures that
gather, sort, analyze, evaluate, and
distribute needed, timely, and accurate
information to marketing decision makers.”
Marketing Information System
Developing Information
Marketing
Managers
Assessing
information
needs
Internal
reports
Marketing
intelligence
Analysis
Target
markets
Marketing
channels
Planning
Competitors
Implementing
Controlling
Marketing
Environment
Distributing
information
Marketing
decision
support
analysis
Publics
Marketing
research
Marketing Decisions and Communications
Macroenvironment
forces
Marketing Information System (cont’d)
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Internal Records Systems
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Order-to-payment cycle is key
Timely sales reports help to better manage
inventory
Customer, product, salesperson and other
databases can be mined for fresh insights
VMI（vendor-managed inventory)
Marketing Information System (cont’d)
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Marketing intelligence system
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A set of procedures and sources used by
Manager??????
Not result data but happenings data
Collect information by:
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Reading books,newspaper, trade publications;
Talking to customers, supplies, and distributors;
Checking Internet sources,
Meeting with other company managers
Marketing Information System (cont’d)
Training and motivating the sales force
Motivating channel
members to
share info
Collecting
competitive
intelligence
Improving
the quality of
marketing
intelligence
Buying info from
commercial
data sources
Developing
a customer
advisory panel
Establishing a marketing information center
Marketing Information System (cont’d)
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Marketing Research
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As the systematic design,collection, analysis,
and reporting of data and findings that are
relevant to a specific marketing situation
facing the company
Marketing Information System (cont’d)
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Marketing Research is
the process of
designing,
gathering, analyzing
and reporting of
information that
may be used to solve
a specific marketing
problem.
Burns and Bush, 2000
Marketing Information System (cont’d)
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Marketing Research
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The Structure of The MR Industry
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Internal Suppliers
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Have their own formal departments
at least a single individual responsible for marketing
research
Have their own formal marketing research
department
Marketing Information System (cont’d)
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Marketing Research
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External Suppliers
 Syndicated Services research firm: Infoscan
 Custom marketing research firms
 Specially-line marketing research firms
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Field Services
Market Segment Specialists
Data Entry Services
Sample Design & Distribution Services
Data Analysis Services
Specialized Research Technique Services
Marketing Information System (cont’d)
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The Marketing Research Process
Marketing Information System (cont’d)
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Marketing Research
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A case of marketing research Taxi mobile
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Invitation
Marketing proposal
Qualitative research:focus group
Quantitives research:mall intercept interview
Data edit in Spss or excel
Written Report and oral report
Marketing Information System
(cont’d)
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Marketing research
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Step 1 Define the problem and research objective
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Problem:???
Objective:
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Brand awareness
Usage of mobile
New concept of tax driver mobile
The kinds of Marketing research
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Exploratory research
Descriptive research
Causal research
Marketing Information System
(cont’d)
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Marketing research
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Step 2 Develop the research plan
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Decisions on Data Sources
Research Approaches
Research Instruments
Sampling Plan
Contact Methods
Data Sources
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Primary data
Secondary data, look at the book
For taxi case, which is primary data and
which is secondary data?
17
Research Approaches
Observational
Focus-group
Survey
Behavioral
Experimental
Research Instruments
Laddering techniques
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Laddering techniques involve the creation, reviewing
and modification of hierarchical knowledge, often in
the form of ladders (i.e. tree diagrams).
Sampling Plan
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Sampling unit:
Sample size:
Sampling procedure
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Probability sampling
Unprobability sampling
Contact Methods
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In home interview
Mall intercept interview
Traditional telephone interview
Computer assisted telephone interview CATI
Mail survey
Drop off survey
On-line interview
Marketing Information System (cont’d)
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Marketing Research
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Step 3 Collect information Field work
Step 4 Analyze the information Tabulate the data
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Statistical technique
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Frequency
Chart
Mean, mode, and correlation, regression
Step 5 present the findings Presentation
Marketing Information System
(cont’d)
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Marketing Decision Support System
(MDSS)
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It is defined as . . .
“A coordinated collection of data, systems, tools,
and techniques with supporting software and
hardware by which an organization gathers and
interprets information from businesses and the
environment and turns it into a basis for
marketing action.”
2. Forecasting and Demand
Measurement
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Market Measurement
Demand Measurement
Estimating Current Demand
Estimating Future Demand
2. Forecasting and Demand
Measurement (cont’d)
Please give EX.
Essential Aspects
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The market
Market demand
Company demand
and sales forecasts
Current demand
Future demand
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Market
Potential market
Available market
Target market
(served market)
Qualified available
market
Penetrated market
2. Forecasting and Demand Measurement
(cont’d)
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What will you do when not satisfied
 Try to attract more buyers from its target
market
 Lower the qualification of potential buyers
 Expand its available market by adding
distribution or lowering price
 Try to expand the potential market by
advertising to prospect
2. Forecasting and Demand Measurement
(cont’d)
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Demand Measurement
Figure 5-2:
Market Demand Functions
2. Forecasting and Demand
Measurement (cont’d)
Essential Aspects
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Market demand
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The market
Measuring demand
Company demand
and sales forecasts
Current demand
Future demand
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Market minimum
Market forecast
Market potential
Market forecast
Market potential
2. Forecasting and Demand
Measurement (cont’d)
Essential Aspects
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The market
Measuring demand
Company demand
and sales forecasts
Current demand
Future demand
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Company demand
Company sales
forecast
Sales quota
Sales budget
Company sales
potential
2. Forecasting and Demand
Measurement (cont’d)
Essential Aspects
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The market
Measuring demand
Company demand
and sales forecasts
Current demand
Future demand
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Total market
potential
Area market
potential
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Market-buildup
method
2. Forecasting and Demand
Measurement (cont’d)
Essential Aspects
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The market
Measuring demand
Company demand
and sales forecasts
Current demand
Future demand
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Many Forecasting
Methods:
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Buyer intentions
survey
Composite of sales
force opinions
Expert opinion
Past-sales analysis
Market-test method
3. Macroenvironmental
Trends And Forces
Demographic
Ethnic Markets
Environment
Population Age Mix
Educational Groups
Household Patterns
Rise of Micromarkets
Geographic Population Shifts
Worldwide Populations Growth
3. Macroenvironmental
Trends And Forces (cont’d)
Economic Environment
Income Distribution
Savings, debt,
and credit availability
3. Macroenvironmental
Trends And Forces (cont’d)
Natural Environment
Changing role of
governments
Shortage of raw materials
Anti-pollution pressures
Increased energy costs
3. Macroenvironmental
Trends And Forces (cont’d)
Accelerating pace of
technological change
Unlimited
opportunities for
innovation
Technological
Environment
Increased regulation of
technological change
Varying R&D
budgets
3. Macroenvironmental
Trends And Forces (cont’d)
Political-Legal Environment
Legislation
regulating business
Growth of
special interest groups
3. Macroenvironmental
Trends And Forces (cont’d)
Socio-Cultural Environment
World views held
by consumers
High persistence of
core values
Existence of subcultures
Thank you very much!