Chapter 3 - Collecting info and forecasting demand

Question 1

Components of a Modern Marketing Information System (MIS)

Answer 1

• Internal company records
• Marketing intelligence activities
• Marketing research

Question 2

Modern Marketing Information System

Answer 2

Consists of people, equipment, and procedures to gather, sort, analyze, evaluate, and distribute needed, timely, and accurate information to marketing decision makers.

Question 3

Internal company records

Answer 3

• Order to payment cycle (Dealers, sales representatives, customers send orders to the firm)
• Sales Information Systems
• Databases, Data Warehousing, Data Mining

Question 4

How do you improve marketing intelligence?

Answer 4

• Train & motivate the sales force to spot and report new developments
• Motivate distributors, retailers, & other intermediaries to pass along important intelligence
• Hire external experts to collect intelligence
• Network internally and externally
• Set up a customer advisory panel
• Take advantage of government-related data sources
• Purchase information from outside research vendors
• Collect marketing intelligence on Internet

Question 5

Marketing research

Answer 5

Identify needs and trends
- Fad, Trend, Megatrend

6 Major forces in the broad environment:
• Demographic • Economic
• Socio-cultural • Natural
• Technological • Political-legal

Question 6

Fad

Answer 6

Unpredictable short-lived and w/o social, economic, and political significance

Question 7

Trend

Answer 7

Reveal the shape of the future
& can provide strategic direction
- More predictable & durable than a fad

Question 8

Megatrend

Answer 8

“large, social, economic, political, and technological change that is slow to form, and once in places influences us for some time”

• B/w 7 to 10 years or longer

Question 9

Demographic environment

Answer 9

• Worldwide/US population growth
• Population age mix
• Ethnic and other markets
• Educational groups
• Household patterns

Question 10

Economic environment

Answer 10

• Recession, inflation, unemployment
 • Consumer psychology and Income
       - Income distribution
       - Very low income
        - Mostly low income
       - Very low, very high
       - Low-medium-highincome
       - Mostly medium income

Question 11

Sociocultural environment

Answer 11

• Core cultural values (ex. working, getting married, honesty)
• Views of ourselves, society, others, nature, organizations
• Roles of men/women rights and purchase beviour
• Preservation of environment

Question 12

Natural environment

Answer 12

Examples - 
• Hybrid car
• Low-flow toilets
• Organic food, Green office building 
• Wind farms
• Sun Oven
• Corporate Environmentalism 
• Green Marketing

Question 13

Technological environment

Answer 13

Accelerating pace of change
• Time between idea and implementation is shrinking

• Unlimited opportunities for innovation
• Varying R&D budgets
• Increased regulation of technological change

Question 14

Politcal-legal environment

Answer 14

Laws
• Sherman, Clayton
• Patent, Copy Right
• Mandatory Recycling

Government agencies
• FDA,FTC

Consumerist Movement
• Consumer Product Safety
• Nutritional Labeling
• Unit Price
• Consumer Bill of Rights: right to be safe, be heard, be informed, to choose

Question 15

Recession

Answer 15

A significant decline in economic activity spread across the economy, lasting more than a few months

• Loss of jobs
• Decline in real income
• Slump in consumer spending
• Industrial productions and manufacturing slow down
• Businesses cut their costs in many ways

Question 16

Inflation

Answer 16

Sustained increase in the general level of prices for goods and services in a county, and is measured as an annual percentage change

• Prices rise, and value of money falls (you can buy less goods w/ a dollar in inflation)

Question 17

Unemployment

Answer 17

The percentage of unemployed workers in the total labor force

• Causes ripple effect on the economy
• State will likely raise taxes to compensate for the lost tax revenues. Therefore, everyone will experience a loss in disposable income

Question 18

Potential market

Answer 18

Set of consumers w/ sufficient level of interest in a market offer. BUT their interest isn’t enough to define a market unless they have enough income and access to the product.
(Just Interested)

Question 19

Qualified available market

Answer 19

Set of consumers who have interest, income, access, and qualifications for the market offer.
(Interested + income + access + qualification)

Question 20

Penetrated market

Answer 20

Set of consumers who are buying the company’s products

(Customers who are buying)

Question 21

Ways of estimating future demand

Answer 21

• Survey of buyers’ intentions
Purchase probabilities using scale 0 to 1
Expectations about the economy
Forecasting: the art of anticipating what buyers are likely to do under a given set of conditions

• Composite of sales force opinions - Company asking sales representatives their future sales
• Expert opinion - obtaining forecasts from experts, like dealers, distributors, suppliers, marketing consultants, & trade associates, & economic-forecasting firms
• Past-sales analysis - Developing forecasts on the basis of past sales
• Market-test method - When buyers don’t plan their purchases carefully or experts unavailable/unreliable, perform direct market tests to help forecast new product sales