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Marketing Information System A Marketing Information System is the structure of people, equipment, and procedures used to gather, analyze, and distribute information needed by an organization. Crteriia for a Well-Designed Marketing Information System • Structured organization with people and procedures • Generate a continuous flow of information • Information should be gathered from inside and outside the organization • Information should be compiled and used as a basis for marketing decisions Environmental Scanning Competitive environment Organizational environment Macroenvironment Economic, Political, Social, and Technological trends Monitor actions of direct and indirect competitors Internally generated marketing information Market research activities Point-of-sale information Marketing audits Sales histories and trends Marketing information compiled and summarized Marketing trends evaluated Marketing plans formulated Figure 6.1. Components of a Marketing Information System Internal Guest histories and sales data Employees and management staff Customer feedback Secondary External Trade associations Travel bureaus Trade journals and other periodicals University sources Government sources Syndicated sources Guides, indexes, and directories Information Sources Exploratory Primary Marketing research Descriptive Causal Figure 6.2. Information Sources Requirements for a Successful Marketing Information System • It should be objective • It should be systematic • It should be useful Information Sources • Primary Data – Advantages • Specificity • Practicality – Disadvantages • Cost • Time lag • Duplication • Secondary Data – Advantages • Cost • Timeliness – Disadvantages • Limited applicability • May be outdated • Reliability Types of secondary data • INTERNAL DATA • EXTERNAL DATA Guest histories and sales data Employees and management staff Customer feedback Trade associations Travel bureaus Trade journals and periodicals Other Periodicals Internet University sources Government sources Syndicated services Guides, indexes, and directories Guidelines for collecting external information • • • • State known facts List specific goals and objectives Collect all relevant data Summarize the data and analyze the situation Table 6.1 Comparison of Primary and Secondary Data Collection Methods Characteristic Secondary Data Primary Data Cost to collect data Low High Timeframe to collect data Specificity of data Short Long Low High Reliability of data Unknown High Timeliness of data Can be outdated Recent Define the problem Plan the research Collect the data Analyze the data Prepare the final report Figure 6.3. The Marketing Research Process Research Design • Exploratory research – to gain an understanding of the nature of the problem • Descriptive research – answer basic who, what, where, why, when, and how questions • Causal research – focuses on cause-and-effect relationships Methods for Collecting Data • Experiments • Observation • Surveys – – – – Direct mail Telephone Personal Interview Comment Card Table 6.1 Comparison of Survey Data Collection Methods Direct Mail Surveys Telephone Surveys Cost per respondent Low Medium High Speed of response Low High Medium Response rate Low Medium High Interviewer bias Low Medium High Allows feedback Low Medium High Ability to handle sensitive topics High Medium Low Medium Low High Characteristics Ability to handle complex questions Personal Interviews Organizing Questionnaires I. II. Easy, screening questions More detailed questions regarding product usage and behavior III. Complicated questions involving ratings and rankings IV. Background information (demographics) Question Design • Open-ended Questions – no options, categories or scales • Closed-ended Questions – provide options to choose from for a response – Dichotomous question – two choices (e.g., yes/no) – Multiple category question – categories (e.g., age, income) – Scaled-response question – rating scale (e.g., Likert) Types of Samples • Probability – Simple random sample – Systematic sample – Stratified sample • Nonprobablity – Convenience sample – Judgment sample – Quota sample Determining Sample Size • Acceptable level of sampling error • Amount of variability in the population • Desired level of confidence Table 6.2 Sampling Error by Sample Size Sample Size Allowance for Sampling Error (95% confidence level) 200 5-8% 400 4-6% 600 3-5% 800 3-4% 1,000 2-4% 1,500 2-3% Data Analysis • Descriptive Analysis – Profile of respondents or sampling units – Average or typical respondent • Inferential Analysis – Test hypotheses and estimate parameters using sample statistics – Make inferences from sample to population Research Ethics • Rights and obligations of the respondent – Be truthful with responses – Right to privacy; confidentiality – Right to know true nature of the research • Rights and obligations of the researcher – To provide privacy and confidentiality to respondents and clients – To remain impartial and objective – To be honest and accurate with results • Rights and obligations of the client – To be honest about nature of the research – To be honest in dealings with suppliers (proposals) – To be committed to research © 2010 John Wiley & Sons, Inc.