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European Journal of Scientific Research ISSN 1450-216X / 1450-202X Vol. 128 No 1 January, 2015, pp. 35-44 http://www.europeanjournalofscientificresearch.com The Relationship between Marketing Information System and Gaining Competitive Advantage in the Banking Sector in Jordan Anas Y. Alhadid Assistant Professor, Department of Marketing Applied Science Private University, Amman, Jordan P.O.Box 166 Amman, 11931 Jordan E-mail: [email protected] Hasan Ali Al-Zu’bi Professor, Department of Business Administration Applied Science Private University, Amman, Jordan P.O.Box 922717Amman, 11192 Jordan E-mail: [email protected] Samer Barakat Associate Professor, Department of Management Information Systems Applied Science University, Amman, Jordan P.O.Box 166 Amman, 11931 Jordan E-mail: [email protected] Abstract This study investigates the relationship between marketing information system and gaining competitive advantage in the banking sector in Jordan. It explores the usefulness of the use of information technology in achieving competitive advantage. It also aims to relate the components of marketing information systems with the competitive advantage in the banking sector. The researchers obtained secondary data from documented sources and primary data from the use of a questionnaire. The results of the analysis showed that there is a relationship between the Internal Records, Marketing Research, and Marketing Intelligence and achieving competitive advantage in the Jordan Baking Sector. The results also indicated that only two traits; age and educational Level, had a relationship with marketing information system. However there was no significant relationship between gender, Experience Years and of respondents and their perceptions of marketing information system. Keywords: marketing intelligence, marketing research, internal records 1. Introduction Marketing information system supports managers in their day-to-day activities. It helps them in conducting marketing activities in the most successful way. It can be defined as an optimal combination of human resources, technology and procedures to gather, analyze and distribute meaningful information to be used to make marketing decisions (Al-ajamar, Tayseer and Tai, 2002). The Relationship between Marketing Information System and Gaining Competitive Advantage in the Banking Sector in Jordan 36 Marketing managers at the Banking sector faces many challenges as they carry out marketing activities. The general public tends to underrate their marketing efforts through suspicion and lack of trust in the banking sector (Raymond and John, 2001). This therefore, calls for creativity and innovativeness in the way marketing is conducted in the banking sector. Every successful business is attributed by successful marketing efforts. Therefore, managers can improve their decision making by integrating the information systems in their marketing procedures. Marketing information system is increasingly becoming an integral part of every business. In the banking sector services are being digitized where information technology is taking the centre stage. In marketing, the information transfer is taking place at a terrific speed. To avoid being overtaken by events, any company must embrace the information system in order to evaluate market forces that will ensure the business success. Information on competitors, opportunities and prices, are valuable for marketing success. Marketing information system is helpful in carrying out marketing research, analyzing internal records and conducting market intelligence. This research seeks to explain and single out the role of marketing information system for gaining sustainable competitive advantage in the banking sector (Mark, 2000). 2. Literature Review 2.1. Information System and Marketing Strategy Any organization must have marketing strategies, which are aimed at achieving a market niche. They are also aimed at gaining competitive advantages over the competitors. Market information systems will be effective in attaining these goals which are key ingredients for its success (Huda and Yonsei, 2009) As a result of fluctuations in the market trend there is a need to incorporate information technology in the marketing activities in order to predict future uncertainties. Therefore, in the banking sector which is characterized by the competitiveness of the marketing information system will be very effective. It helps in obtaining the necessary information which is vital for managing marketing activities (Huda and Yonsei, 2009). 2.2. Role of Marketing Information System In any business, marketing information system has an influential role in attaining a competitive advantage. This can either be in terms of cost advantage or differentiation. It will help companies to forecast and react to change in a competitive way (Broadbent and Weil, 1993). Broadbent and Weil stated that, marketing information system will be useful in; • It offers a new way to combat competition • It helps revolutionize the entire business in terms of how it conducts marketing activities. • It helps to structure the organization towards better competitive position. • It is also useful in identifying market opportunities through forecasting and analyzing marketing needs. Marketing information system is a combination of people with different competencies, procedures and means through which management makes decisions concerning the markets (Talvinen, 1995). This in turn, facilitates marketing planning and coming up with viable strategies to seize market opportunities. According to Talvinen (1995), marketing information system is the optimal combination of human resources, machines and procedures which relay the needed information from the environment for decision making. Marketing information system is made up of: 2.2.1. Internal Records This is data collected and stored in a database which pertains to daily marketing activities. It helps in planning so as to minimize the risk of uncertainty about the future. 37 Anas Y. Alhadid, Hasan Ali Al-Zu’bi and Samer Barakat 2.2.2. Marketing Intelligence This is the strategy of getting information about the market in terms of prospective and existing customer base with a view to determine the market needs. This information is analysed so as to come up with viable decisions to exploit any market opportunity. Market intelligence helps an organization to monitor competitors’ moves so as to come up with counter measures (Callingham, 2004). 2.2.3. Market Research This is the process of collecting both qualitative and quantitative data that relate to market processes. The data collected thereof is analyzed so as to interpret and solve the marketing issues concerning the company’s products and services. It is a scientific orientation which ensures the marketing problems are confronted with efficiently. In line with this, marketing information system helps to eliminate information asymmetry, by availing the right information, at the right time and about the right place to the organization. It also supports managers in the decision making process of articulating the market information to the internal environment. Therefore, organizations can make quick response to market fluctuations. This information can also be stored for future uses in the organization’s databases (Raymond and Rogers, 2001). Marketing information system will be effective in developing new and innovative product and service which meet the customers’ expectations. Through continuous analysis of market information, organizations will be able to improve their market response and coming up with supportive decisions that will guarantee organization success (Alexandra, 2005). A market poses many dynamic variables which call for managers to come up with better decisions to outshine their competitors. Through technology, managers can apply the information system to generate viable decisions. Decision support systems (DSS) are one of such technique. It assists in coming up with accurate decisions that ease the decision making process. System information can be integrated into marketing processes in many ways. It is applied in such a way that, market information will be manageable and utilized in the best way possible. A decision support system is being used today in making complex decision concerning the market. Therefore, marketing information system is the determining factor towards incorporating full market forces in the organization’s decision making process ((Alexandra, 2005). In line with this, information technology presents a golden opportunity to any company that craves for attaining a competitive advantage (Barney, 1991). 2.3. Why Marketing Information System? Marketing information system has far reaching benefits to any business organization. The reasons for marketing information system therefore include: • Competition; due to stiff competition in the market, organizations has no other option but to embrace information systems in their marketing processes. • Need for support to decision making; as managers are faced with many variables in the market, the decision making process grows more complex. Management information system has tailor made system techniques in support of decision making. • Measure performance; it assists in evaluating the performance of a particular service or a product by assessing the customer satisfaction about the product. • Monitor environment; external environment is very dynamic. This calls for regular and close monitoring of the market forces so as to keep up-to-date with the current issues. • Need for market intelligence; there is the need to gather competitive intelligence about the market to identify the existing and potential customers for the business. • Improving efficiency; as a result of growing customer needs it calls for efficient methods of data collection concerning the customer needs. Marketing information systems help to obtain the needed information to develop new products that meet consumer needs. The Relationship between Marketing Information System and Gaining Competitive Advantage in the Banking Sector in Jordan • • 38 Need to reduce market risks; market information systems help to reduce the risks associated with the market such as product failure, changing customer preferences that results from poor marketing strategies. Information overload; as information sources increases every day on organization may be spoilt for choice and end up using wrong information. Management information system helps organizations to apply and manage useful information for effective decision making (Gosh, 1998). 2.4. Creating Competitive Advantage through Information Technology Figure 1 Figure1 illustrates the way activities are intertwined to achieve competitive advantage. It shows two distinctive types of business activities, which are primary activities and supportive activities. According to Porter (1985), Primary activities refer to those activities which enable organizations to execute their roles in the most fulfilling way. The customers on the other hand, are able to perceive the benefits through the organized and coordinated activities of the businesses. To make sure that the final customer is satisfied with their services, these activities have to be well performed and well coordinated throughout the business processes Support activities on the other hand, have a long term business effect. They are used to come up with strategies that are aimed at long term development of the business. These activities are aimed at adding value to the business indirectly. The value obtained in these activities is determined by the success of primary activities. The value chain helps to understand the impact of information technology in the marketing decision making. It represents the combination of activities that facilitate the production process and the subsequent delivery of the product or service to the end consumer. Value chain also helps to identify the needed actions and analysis of their effects in terms of the costs and the value derived from the ultimate customers. The use of information technology has added value to the activities, and the 39 Anas Y. Alhadid, Hasan Ali Al-Zu’bi and Samer Barakat way they are linked together to facilitate the entire production process (Porter, 2001). These activities incorporate information technology through online services, which greatly reduces the cost of transactions (Bakos, 1986). According to Bakos, information technology also helps in the way companies respond to the forces of supply and demand in the market. This was facilitated by the availability of the market information which facilitates faster decision making. Porter believes that, the industry competitiveness is largely contributed by the way it is structured economically. This will determine the degree to which an organization can combat competition in the market. In his approach, he seeks to exemplify the competition in the market and its dynamism. He adds that, there are five forces, which affect the competitive attractiveness in an industry. These forces include the threat posed by the substitute products or services, the competitors’ rivalry, entry barriers, bargaining and purchasing power of both buyers and suppliers (Porter, 2001). 3. The Problem Statement The study problem is concerned about the role of marketing information system for gaining sustainable competitive advantage in the banking sector. This problem can be generalized through the following questions: 1. Is there any statistical significance between marketing information system and competitive advantage in the banking sector? 2. Is there any statistical significance between the internal records in the marketing information system as a whole and attaining competitive advantage in the banking sector? 3. Is there any statistical significance between the marketing research and competitive advantage in the banking sector? 4. Is there any statistical significance between the marketing intelligence and competitive advantage in the banking sector? 4. Benefits' and Justification for Conducting the Study The importance of this study is to identify the role played by the marketing information system in the banking sector in terms of: It provides marketing information to aid in decision making. Availability of accurate and reliable information about the market helps in decision making where marketing activities can be planned, implemented and monitored to ensure marketing success. It also helps to achieve effectiveness in the way an organization conducts the marketing activities by enhancing accurate and timely decisions concerning the market. Management information system also enhances efficiency in how organizations formulate marketing policies in order to serve customers better. Information is part and parcel of the successful marketing process (Badr al- Din). Information on customers and competitors as the organization embraces globalization allows organizations to carry out business globally. 5. Objectives' of the Study This study aimed at: 1. To determine the relationship between the major components of marketing information system, and competitive advantage in the banking sector. 2. Introduce the concept, elements, and components of marketing information system to the banking sector. 3. Make recommendations concerning the marketing information system obtain thereof from the research findings. The Relationship between Marketing Information System and Gaining Competitive Advantage in the Banking Sector in Jordan 40 6. Suggested Model A model consists of two types of variables, the independent variable (Marketing Information System) and the dependent variable (Competitive Advantage) as shown in figure (1). Figure 2: Research Model Marketing Information System Internal records Marketing research Competitive advantages Marketing intelligence 7. The Hypotheses of the Study The study tested the specific hypothesis and a general hypothesis as outlined below; The specific hypothesis: H01: There is no statistically significant relationship between marketing information system and competitive advantage in the banking sector. Sub hypothesis: H01-a: Internal records, one of the marketing information system components, are not statistically related to the competitive advantage in the banking sector. H01-b: Marketing research, the next component of the marketing information system, is not statistically related to the competitive advantage in the banking sector. H01-c: Marketing intelligence as a component of the marketing information system is not statistically related to the competitive advantage in the banking sector. H02: There is no significant relationship between Sample study perception of marketing information system and their personal traits such as gender, age, level education, Experience Years. 8. Methodology of the Study 8.1. Population and Sample The study obtained a population of ten banks from the banking sector in the country. The sample survey method is used to obtain the population. The researchers used a sampling frame of sixty four managers and staff in these banks to obtain required data for the study. The population composed of marketing managers, information system analysts and staffs of marketing information system departments of the banks in the study. All these represent the unit of analysis. 194 questionnaires were distributed to a sample study. Of the (189) questionnaires returned, (3) were rejected due to incomplete responses and (186) responses (95.8 percent response rate) were used for data analyses. 41 Anas Y. Alhadid, Hasan Ali Al-Zu’bi and Samer Barakat It should be noted that every questionnaire was personally handed and instructions were given to each employee before completing the questionnaire. In terms of demographic findings, (67%) of respondents were males, and the remaining (33%) were females. In terms of the age group of respondents, it is interested to note that (8%) of them are less than (25) years, whereas (26%) fell into the (25-34) age group, whereas (37%) fell into the (35-44) age group, only (29%) are above this group. Also, from educational levels point of view the sample who have a majority (80%) were university certificate holders, and some those (14%) of these, have Higher Education degree. In addition, for the experience years of respondents, (12%) of them have (5) years or less, whereas (20%) have (6 - 10) Experience years, whereas (45%) have (11 - 15) years of experience, only (23%) have more. See table (1). Table 1: Demographic Characteristics of respondents (n=186) Characteristics Gender: Male Female Age: Less than 25 years 25 –34 35 – 44 45 years and more Educational Level: Diploma or less Bachelors Higher Education Experience Years: 1–5 6 – 10 11 – 15 16 years and more Frequency Percentage 125 61 67% 33% 15 48 69 54 8% 26% 37% 29% 11 149 26 6% 80% 14% 22 37 83 44 12% 20% 45% 23% 8.2. Data Collection Tools The researcher used a questionnaire to collect data of the study and its variables from the units of the study. The questionnaire comprised of two parts; 1. The first part contained the general characteristics of the banks and the sample presented in the population or the units of the study 2. The second part determined the extent to which the competitive advantage in the banking sector relates to the components of the marketing information system which are; internal records, marketing research and marketing intelligence. 8.3. Data Sources In this study, there are two sources of data which are employed by the researcher. These are; 1. Secondary Sources This was obtained from the relevant documented sources in order to supplement the findings already obtained from the primary sources. The documented sources concerning the marketing information system and its application in the banking sector were consulted. These sources included periodicals, references and literature which supported the findings. 2. Primary Sources Primary data were collected through questionnaires which were designed for obtaining data from the units of the study. The data were used to obtain the first hand information. It was collected on the The Relationship between Marketing Information System and Gaining Competitive Advantage in the Banking Sector in Jordan 42 general bank characteristics as well as the extent to which competitive advantage in the banking sector relates to the components of the marketing information system. 8.4. Methods of Data Analysis The data collected was descriptive and analytical. The researcher had to analyse the variables and test hypothesis of the study through the following data analysis methods; 1. Descriptive statistics- this was used to describe the characteristics of the individual member in the population of the study. It included the use of frequency tables, standard deviations, means and percentages. 2. Correlation – data were analyzed through correlation coefficient where the researcher used it to correlate the relationship between the dependent and independent variables and the strength of their relationship (Verbeek, 2008). 8.5. Validity and Reliability 1. Validity represents the ability of the instrument to measure the intended variable of the study with accuracy. To comply with the requirement the questionnaire has been presented to the panel of experts in matters of marketing, who approved and ascertained its validity (Verbeek, 2008). 2. Reliability is the extent to which the tool is able to obtain consistent results even if the measurements are obtained in second time in the similar circumstances. The degree of reliability is denoted by the use of Cronbach’s Alpha (Verbeek, 2008). 9. Results 9.1. Relationship between Marketing Information System and Competitive Advantages To test the significant level of the first hypothesis proposed by the researcher, and at the same time achieve our final objective that been soughed by this study, table (2) presents the means and standard deviations, and Zero-order correlations among marketing information system and Competitive advantages. H01-a: Internal records, one of the marketing information system components, are not statistically related to the competitive advantage in the banking sector. The results of the statistical analysis and described in Table (2) the existence of a relationship between the independent variable (Internal records) and the dependent variable (competitive advantages). Where there is a positive relationship statistically significant at a level significantly less than (0.05) as shown by Pearson correlation analysis, we notice that the value of the correlation was (r =0.633**) at a level of significance (0.01), a result lead to the rejection of the null hypothesis and acceptance of the alternative hypothesis that: There is a relationship between the Internal records and competitive advantages. H01-b: Marketing research, the next component of the marketing information system, is not statistically related to the competitive advantage in the banking sector. Results indicate statistical analysis to the existence of a relationship between the independent variable (Marketing research) and the dependent variable (competitive advantages). Where there is a positive relationship statistically significant at a level significantly less than (0.05) as shown by Pearson correlation analysis, we notice that the value of the correlation was (r =0.743**) at a level of significance (0.01), a result lead to the rejection of the null hypothesis and acceptance of the alternative hypothesis that There is a relationship between the Marketing research and competitive advantages, see table (2). H01-c: Marketing intelligence as a component of the marketing information system is not statistically related to the competitive advantage in the banking sector. 43 Anas Y. Alhadid, Hasan Ali Al-Zu’bi and Samer Barakat Results of the statistical analysis to the existence of a relationship between the independent variable (Marketing intelligence) and the dependent variable (competitive advantages). Where there is a positive relationship statistically significant at a level significantly less than (0.05) as shown by Pearson correlation analysis, we notice that the value of the correlation was (r =0.743**) at a level of significance (0.01), a result lead to the rejection of the null hypothesis and acceptance of the alternative hypothesis that There is a relationship between the Marketing intelligence and competitive advantages, see table (2). Table 2: Means, Standard Deviations and Pearson Correlation among the research variables variables M Internal records 3.439 Marketing research 3.387 Marketing intelligence 3.416 Competitive advantages 3.581 ** Correlation is significant at the 0.01 level. * Correlation is significant at the 0.05 level. S.D 0.900 0.781 0.879 0.860 1 1 0.722** 0.743** 0.743** 2 0.722** 1 0.622** 0.623** 3 0.743** 0.622** 1 0.633** 4 0.743** 0.623** 0.633** 1 9.2. Relationship between Employees' Perception of Marketing Information System and their Personal Traits To achieve the second objective of this study and at the same time test the hypothesis, data about employees' background traits were collected. Traits such as age, gender, educational level, and Experience Years were investigated to see if there were significant relationship between them and the perception of marketing information system. Using one-way ANOVA between marketing information system and employees personal traits, the results showed that there was only two significant relationship exists between age, educational Level and of respondents and their perceptions of marketing information system. But there is no significant relationship between gender, Experience Years and of respondents and their perceptions of marketing information system, As well as for educational level. Figures in table (3) showed that the significant level between these two variables was (0.00) which is significant at (0.05). Table 3: One-way ANOVA between Marketing Information System and Employees' Personal Traits Marketing Information System Age Sex Educational Level Experience Years * Correlation is significant at the 0.05 level. F 6.946 2.119 8.288 1.660 Sig. 0.000 0.096 0.000 0.174 10. Conclusions This study aimed at identifying the role of the marketing information system in the banking sector in order to achieve competitive advantage. The results of the analysis showed that there is a relationship between the Internal Records, Marketing Research, and Marketing Intelligence and achieving competitive advantage in the Jordan Baking Sector. The results also indicated that only two traits; age and educational Level, had a relationship with marketing information system. However there was no significant relationship between gender, Experience Years and of respondents and their perceptions of marketing information system. The results implies that bank managers at Jordanian Banks must consider utilizing Marketing Information Systems in order to achieve competitive advantage. The Relationship between Marketing Information System and Gaining Competitive Advantage in the Banking Sector in Jordan 44 Acknowledgement The authors are grateful to the Applied Science Private University, Amman, Jordan, for the full financial support granted to this research project (Grant No. DRGS-2014-2015-48). Reference [1] [2] [3] [4] [5] [6] [7] [8] [9] [10] [11] [12] [13] [14] [15] [16] [17] Al-ajarma, tayseer and Tai, Mohammed(2002). marketing information system, Amman: Dar alHamed for the publication and distribution. 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