Multimedia Marketing/Marketing.iso/market/chapter4.2p

Text File | 1996-08-22 | 13KB | 293 lines

SECTION 4.2  Marketing Information Systems

INSTRUCTIONS Think about what kinds of systems marketers could use to arrange
for acquiring and using information effectively.

EXAMPLE

A producer of large and small electric appliances utilizes what is
called a "World Wide Marketing Screen". At its heart is a central
computer that key managers can access with desktop terminals
located in their ofices. The memory contains millions of information
pieces, such as the names of over 40,000 potential business customers
worldwide, all planned construction projects worldwide that amount
to ,1 million or more, and 20 year economic forecasts of 160 countries.

At the touch of a button, executives can acquire product sales
forecasts, define market targets, and even plan future sales efforts.
Some of this information is shared with retailer-customers.

DETAILS

Most progressive companies have a formal system of collecting and
reporting market information. The major feature of this arrangement,
termed a "Marketing Information System" (MIS) is that the firm
systematically collects and reports data in such a way that they
are of major value in assisting decision making.

The marketing information system operates continuously. This is in
contrast to marketing research, which management conducts on a project-
to-project basis, as the need arises. The MIS is always functioning
in an attempt to acquire information from all sources, both inside
and outside the company. The MIS obtains timely and relevant inputs
from the various sources, processes these into usable form, and
transmits the resulting information to the marketing executives who
need the information. Normally, the MIS is heavily dependent on
computerized data processing facilities.

Marketing information systems should not be confused with management
information systems. Both are called MIS's. The management information
system collects, processes, and disseminates data for the whole
company--human resource management, operations management, top
management, marketing, and finance, for instance. The marketing
information system is part of the management information system.

PROBLEM 1

A producer of sandwich bags is considering the formation of a MIS.
Which of the following will the system not do for the company?

A. Obtain timely and relevant information.
B. Process information into usable form.
C. Transmit information to company executives.
D. Develop marketing strategies for management.

WORKED

The MIS is an information acquiring, processing, and transmitting
system. For a producer of sandwich bags, the system will acquire
up-to-date useful information about such things as what consumers
use the bags for, who uses the bags, how often they are purchased,
and problems with the product. The system will acquire numerous
bits of information and will arrange these into frequency distributions,
means, percentages, medians, etc., so that their meaning can be readily
understood. Finally, the system will arrange for providing the
information to the executives who need it, on a timely basis.

The MIS will furnish the data needed for decision making. It will
not make decisions or formulate strategy, however. That is the job
of management.

ANSWER  D

INSTRUCTIONS Think about what kinds of systems marketers could use to arrange
for acquiring and using information effectively.

EXAMPLE

A producer of large and small electric appliances utilizes what is
called a "World Wide Marketing Screen". At its heart is a central
computer that key managers can access with desktop terminals
located in their ofices. The memory contains millions of information
pieces, such as the names of over 40,000 potential business customers
worldwide, all planned construction projects worldwide that amount
to ,1 million or more, and 20 year economic forecasts of 160 countries.

At the touch of a button, executives can acquire product sales
forecasts, define market targets, and even plan future sales efforts.
Some of this information is shared with retailer-customers.

DETAILS

The elements of a MIS are as follows

Inputs-----------Marketing Information System-----Outputs to Managers
 .Environment     .Data Base
 .Internal        .Data Reduction Unit

Information is collected from the marketing environment (consumers,
suppliers, competitors, and other parties and from sources within the
company (as from accounting personnel).  The sources of information
can be many and varied. In fact, the company may come across useful
inputs in newspaper and magazine articles, from chance comments by
rival company executives at meetings and parties, and from company
sales representatives who hear news from their customers.

The MIS collects, processes, and stores the information and
disseminates it to those marketing executives who could improve
their decisions through information.The idea is that the right
information should get to the appropriate managers in a timely
fashion. Dated information may be of little or no value to marketing
management. It is much more useful to point out to executives that
sales are beginning to decline than to say that they have declined.

The MIS contains a data base. Here information is received, processed,
edited, and stored. The data base can have a wealth of detailed
information on consumers, competitors, channel members, and other
parties. When the need arises, the data-reduction unit transforms
the information in such a manner that it is relevant for particular
marketing decision makers.

The output of the MIS is timely and relevant information that
marketing executives need. In turn, this information is employed by
executives as an aid to decision making.

PROBLEM 2

The data reduction unit for a manufacturer of body shampoo:

A. Collects information from the marketing environment.
B. Collects information from within the company.
C. Transforms information so it is relevant to decision makers.
D. Stores information.

WORKED

The data reduction unit transforms information in such a manner
that it is relevant for particular marketing decision makers. For
a manufacturer of body shampoo the unit would provide information
such as what consumers use the product, how often they use it, how
often they buy it, and prices consumers are willing to pay. It is
in this unit that meaningful information is prepared. There is no
point in providing management with reams of computer output in
infinite detail. What management needs are summaries of the data,
not the raw output.

ANSWER  C

INSTRUCTIONS Think about what kinds of systems marketers could use to arrange
for acquiring and using information effectively.

EXAMPLE

A producer of large and small electric appliances utilizes what is
called a "World Wide Marketing Screen". At its heart is a central
computer that key managers can access with desktop terminals
located in their ofices. The memory contains millions of information
pieces, such as the names of over 40,000 potential business customers
worldwide, all planned construction projects worldwide that amount
to ,1 million or more, and 20 year economic forecasts of 160 countries.

At the touch of a button, executives can acquire product sales
forecasts, define market targets, and even plan future sales efforts.
Some of this information is shared with retailer-customers.

DETAILS

The MIS gathers data from all sources, including marketing research.
Any source which might be a depository of inputs for management to
use can be drawn upon by the system.  MIS personnel are
specialists in gathering and channeling inputs that operating
executives lack the time and expertise to acquire. An effective MIS
unit helps ensure an aware management is informed of important
developments that might have an impact on the well-being of the
company.

Sometimes useful information is available from a variety of sources.
A competitor may run a help-wanted advertisement for salespeople in
New England, signalling that it plans to expand there. Magazine
interviews of competitor executives may tip off some of their
plans. Chance remarks by competitors, suppliers, intermediaries, and
others at social events may turn out to be revealing of important
developments.

Some companies have employees on their payrolls whose job it is to
seek out information that busy managers do not have time to solicit.
These employees read articles in the trade and in the consumer
press, moniter the internet, interview company and outside personnel
who may possess insights useful to managers, and look for information
in other sources. Their work can be invaluable for a successful MIS.

PROBLEM 3

A producer of industrial belts and hoses is setting up a MIS.
Management is undecided as to where it should get information
inputs into the system. The inputs should include:

A. Accounting records.
B. Marketing research.
C. Information gained from sales representatives.
D. All of the above.

WORKED

A producer of industrial belts and hoses is setting up a MIS.
Management is undecided as to where it should get information
inputs into the system. The inputs should include accounting
records, marketing research, information gained from sales
representatives, press releases of competitors, magazine articles,
information, from suppliers, and many more. In fact, any source of
data, so long as it is reliable, may be used. A distinguishing
feature of the MIS is its acquisition of data from many varied
sources.

ANSWER  D
INSTRUCTIONS Think about what kinds of systems marketers could use to arrange
for acquiring and using information effectively.

EXAMPLE

A producer of large and small electric appliances utilizes what is
called a "World Wide Marketing Screen". At its heart is a central
computer that key managers can access with desktop terminals
located in their ofices. The memory contains millions of information
pieces, such as the names of over 40,000 potential business customers
worldwide, all planned construction projects worldwide that amount
to ,1 million or more, and 20 year economic forecasts of 160 countries.

At the touch of a button, executives can acquire product sales
forecasts, define market targets, and even plan future sales efforts.
Some of this information is shared with retailer-customers.

DETAILS

In some firms, management is overwhelmed with reports, memos, E Mail,
computer printouts, and other communiques. Many of these reports
are quickly dated or become irrelevant. An effective MIS  unit helps
overcome such problems and discovers exactly what information is needed
by each manager and when it is needed. Then the unit takes steps to
insure that this information is provided as required on a "need-to-
know" basis.

Some of the information inputs to marketing managers are relatively
simple. A sales manager, for instance, may want to know monthly
sales compared to quota for each territory in the company. This
manager does not need long computer printouts containing information
in such detail that it is of little or no practical value. Most
managers are very busy and the MIS should be designed so that
its reports are no more difficult to comprehend than is necessary.

Advertising executives need different information. They can use
marketing research feedback on the effectiveness of particular
advertising campaigns and individual advertisements--quantitative
information. Also they can use qualitative information on consumer
life styles, values, and trends, in order to prepare creative
advertisements that have meaning to target customers.

PROBLEM 4

A cereal producer is thinking about utilizing MIS personnel to collect
information about the company and its environment. An important reason
for using these personnel, rather than marketing managers, for this
purpose is:

A. MIS personnel are better qualified to determine what information
   managers need.
B. Marketing managers lack the time and expertise required to
   acquire the information.
C. Marketing managers experience difficulty in reaching decisions
   based upon information.
D. MIS personnel are more experienced in decision making.

WORKED

A cereal producer that is considering using MIS personnel to
acquire information probably would do this because marketing managers
do not have the time and expertise required. Most marketing managers
are already highly involved in planning, organizing, and control
activities. This is especially the case in a volatile industry such
as cereal products. Further, acquiring information is a specialized
activity--one that requires considerable expertise. Many marketing
managers do not have training or experience in this arena. They
are likely to make major mistakes. This is a job for specialists.


ANSWER B