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David Robinson's UGBA 106 lecture
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David Robinsonfaculty.haas.berkeley.edu/robinson/ugba106
Haas School of BusinessHaas School of Business
ugba 106
Marketing
© D. Robinson, 2008
Lecture 5: Marketing Information Systems
Marketing Information Systems
Marketing Research provides a basis for rational decision making
The Marketing Information System(A&K Fig 4.1)
How do we go about Marketing Research?
1. What’s the problem?
2. Develop the research plana. What do we want to know?
b. About which group of people?
How do we go about Marketing Research?
3. Implementation and analysisa. What do we have in our own records?
b. Purchase syndicated data
c. Run our own studies
d. Outsource: Get an expert to run the studies
4. Interpreting, reporting . . . and action!
Marketing Information Systems: Part 1 Internal Data
Firms have a lot of information without commissioning primary
research
Internal Sources of Data
• Sales records by store, time of day, etc• Example: Firms can easily research seasonality
• Customer account analysis
• Known-customer response to Direct promotion
• Sales response to Mass Media advertising
Using Internal Databases
Internal Data Analysis
• Most firms have transaction level data in a data warehouse
• Need to analyze this with– Common sense & creativity– Artificial intelligence
• Why?
• This is called data mining• Data base is particularly useful when
transactions are linked to customers
Example: Safeway Select Soups
Counter-example
Digital Dashboards are Common
Why Kraft-General Foods has an easier time than you do launching a new product
• Most “marketing firms” have:– Extensive intranets with data (see text p.115)– Highly technical analysis
• Example conjoint elasticities when competitors also change prices
– “Rules of thumb” (previous experience)• E.g. Willingness to pay for new product
Marketing Information Systems: Part 2 Buying Research
Before we commissioning primary research we look for “Secondary Data”
Secondary Data Comes First
• Definition: Data collected for another purpose, such as government data
• Consider using proxies• Example: How many “wealthy” families in
Shanghai ≈ how many have children in private schools ?
• Limitations on Secondary data• Timeliness• Quality• Relevance
Admin of the Day
Commissioning Primary Research
A Note on Syndicated Research
Is it “Primary” or “Secondary” data (the difference may be academic)?
The role of syndicated research
• Typically questionnaire, often by phone• Gartner and IDC in tech• IRI, Nielsen Simmons in consumer products• Very cost effective and often quick• Very good data • The third-party researchers are essential to get
around anti-trust• B2B many specialty firms, will interview e.g. oil
exploration managers’ purchase intentions
1. Poorly defined objectives for research
2. Irrelevant subject pool
3. Overly complicated research (example Snapple case)
4. Research that sits on the shelf and isn’t disseminated (timeliness)
5. Failure to act on the information at hand
Typical marketing research failures
Failure to act on the information at hand: Olds Aurora
Two types of primary research
Qualitative Quantitative
• Questionnaires & interviews
• Online data collection
• Scanner data
• Experimentation e.g. “taste tests” different ad spending
Good research will use some of each
• Observational data
• Focus groups
• Story telling, drawing
Two types of primary research
Qualitative
• Observational data
• Focus groups
• Story telling, drawing
Observation
• What to customers actually do?
• Do most people go shopping with their friends?
• Do people touch the goods on before they buy?
Suggested book on observations
• See “Marketing easy reads” on my web-page
Focus Groups
• Selection of participants
• Leading a group• Beware of the
executive behind the one-way glass
Qualitative: Observational
Qualitative:Thematic Apperception Test
Make up a story that reflects what you think is happening in this picture.
Two types of primary research
Quantitative
• Questionnaires & interviews
• Online data collection
• Scanner data
• Experimentation e.g. “taste tests” different ad spending
New Physiological Measures
• Eye movement cameras• GSR (lie-detector machines)• even Magnetic Resonance Imaging
• Scanner data• IRI and Nielsen• Supermarkets make a bit of money from this• “Panel data” is a select group of customers• Types of information companies get from
scanner data:• Time, frequency of purchase• Goods that go together• Response to competitor promotions• Price elasticity
“Behavioral” Data
• Dummy stores
• Miniature “natural experiments”• Best of these are “split-halves” experimental and
control designs• Example: Bear Minimum: Three for the price of two
—today only• Almost every business can run these
Experimentation
Limitations of various approaches
• Focus groups– Loud mouths and over-
interpretation
• Online– Fast but not a random
sample—at all• Mall intercept
– Who are you getting?
• Questionnaires– Only get the answer to what
you are asking
Asking the right question
• Do you think Ronald Reagan is the greatest American who ever lived?
Why we use both types of research
Qualitative Quantitative
• Rich source of ideas
• Insights the firm doesn’t have
• Not “scientific”
• Statistically reliable
• Only answers the questions you ask
• Won’t come up with the ones you forgot to ask
Usually comes first
We us Qualitative to generate the right questions to ask in Quantitative
The Mechanics of the Research Process
How to do it
The Marketing Research Process(A&K Fig 4.2)
What don’t we know? How would our
decision making change if we knew this?
The Marketing Research Process(A&K Fig 4.2)
What method are we going to use?
What sampling plan?
Who
How many?
How chosen?
Focus group
Observation
Survey
“Behavioral” (scanner)
Experiment
How many groups?
Types of Samples
Probability
• Simple random
• Stratified random
• Cluster • e.g. City blocks
Nonprobability
• Convenience
• Judgment• Good prospects
for information
• QuotaJust be a good consumer of
information—ask how the sample
was chosen
The Marketing Research Process(A&K Fig 4.2)
• Make a plan with a timeline
• Collect the data without bias
• Make sure the data are “clean”
• Analyze and summarize
Assessing Marketing Effectiveness
The sorts of measures we consider in a Marketing Audit
Marketing Metrics(how to assess the effectiveness of our marketing effort)
External• Awareness• Market share• Relative price• Customer satisfaction
(JD Power surveys and “would you recommend us to a friend?)
• Total number of customers
• Loyalty, repurchase
Internal• Awareness of Marketing
Plan• Commitment to goals• Active support• Resource adequacy• Staffing levels
Characteristics of Good Marketing Research
• Uses scientific method– Aware of possible bias– Uses good selection– Avoids causation fallacies
• Uses multiple methods to create a complete picture
• Balances cost with effectiveness• Is interpreted with caution
– Don’t over extend what you know• Never uses research as an unethical selling
program