Module-1-Introduction-The-Marketing-Information-System.docx

**Module 1: Introduction: The Marketing Information System** **Learning Outcomes** **At the end of this module, you are expected to:** 1. **Explain the importance of information to a company.** 1. **Introduction** To carry out marketing analysis, planning, implementation and control, mana...

**Module 1: Introduction: The Marketing Information System** **Learning Outcomes** **At the end of this module, you are expected to:** 1. **Explain the importance of information to a company.** 1. **Introduction** To carry out marketing analysis, planning, implementation and control, managers need information. Information is not just an input for making better decisions, but also a marketing asset that gives competitive advantage of strategic importance. Competitors can copy each other's equipment, products and procedures, but they cannot duplicate the company's information and intellectual capital. All companies start small, knowing their customers personally. Managers picked up marketing information by meeting people, observing them and asking questions. However, with growth they need more and better information. When they become national or international in scope, they need more information on larger, more distant markets. As incomes increase and buyers become more selective, sellers need even better information about how buyers respond to different products and appeals. As sellers use more complex marketing approaches and face more competition, they need information on the effectiveness of their marketing tools. Finally, in today's rapidly changing environments, managers need up-to-date information to make timely decisions. The need for more and better information has been met by an explosion of information technology. The past 30 years have witnessed the emergence of small but powerful computers, text messaging, DVD drives, videoconferencing, broadband Internet access and other advances that have revolutionized information handling. Today's managers often receive too much information. For example, one study found that with all the companies offering data, and with all the information now available through supermarket scanners, a packaged-goods brand manager is bombarded with 1 million to 1 billion new numbers each week. Another study found that, on average, office workers spend 60 per cent of their time processing documents; a typical manager reads about a million words a week. Running out of information is not a problem but seeing through the 'data smog' is. Despite this data glut, marketers frequently complain that they lack enough information of the right kind. For example, a recent survey of managers found that although half the respondents said they couldn't cope with the volume of information coming at them, two thirds wanted even more. The researcher concluded that 'despite the volume, they're still not getting what they want.' Thus, most marketing managers don't need more information; they need better information. Companies have greater capacity to provide managers with good information, but often have not made good use of it. Many companies are now studying their managers' information needs and designing information systems to meet those needs. 2. **The Marketing Information System** A marketing information system (MIS) consists of people, equipment and procedures to gather, sort, analyze, evaluate and distribute needed, timely and accurate information to marketing decision makers. The figure below illustrates the marketing information system concept. The MIS begins and ends with marketing managers. First, it interacts with these managers to assess their information needs. Next, it develops the needed information from internal company records, marketing intelligence activities and the marketing research process. Information analysis processes the information to make it more useful. Finally, the MIS distributes information to managers in the right form at the right time to help them in marketing planning, implementation and control. The marketing information system primarily serves the company's marketing and other managers. However, it may also provide information to external partners, such as suppliers, resellers, or marketing services agencies. For example, Walmart (an American multinational retail corporation that operates a chain of hypermarkets, discount department stores, and grocery stores from the United States) has a Retail Link system that gives key suppliers access to information on everything from customers' buying patterns and store inventory levels to how many items they've sold in which stores in the past 24 hours. A good marketing information system balances the information users would like to have against what they really need and what is feasible to offer. Some managers will ask for whatever information they can get without thinking carefully about what they really need. And in this age of big data, some managers will want to collect and store vast amounts of digital data simply because technology lets them. But too much information can be as harmful as too little. In contrast, other managers may omit things they ought to know, or they may not know to ask for some types of information they should have. The MIS must monitor the marketing environment to provide decision makers with information they should have to make key marketing decisions. Finally, the costs of obtaining, analyzing, storing, and delivering information can mount quickly. The company must decide whether the value of insights gained from additional information is worth the costs of providing it, and both value and cost are often hard to assess.