Chapter4: Managing Marketing Information To Gain Customer Insights

Question 1

Marketing information

Answer 1

Customer needs and motives for buying are difficult to determine (not obvious).
Required by companies to obtain customer and market insights.
Generated in great quantities (big data) with the help of information technology and online sources.

Question 2

Today’s Big Data

Answer 2

Big data refers to the huge and complex data sets generated by today’s sophisticated information generation, collection, storage, and analysis technologies.
Big opportunities, but also big challenges.

Question 3

Customer insights

Answer 3

Fresh marketing information-based understandings of customers and the marketplace:
- become the bases for creating customer value, engagement, and relationships.

Customer insights teams collect customer and market information from a wide variety of sources.

Question 4

Marketing Information System (MIS)

Answer 4

Consists of people and procedures to
- assess information needs
- develop the needed information
- help decision makers use the information to generate and validate actionable customer and market insights.

Question 5

Assessing marketing information needs

Answer 5

A good MIS balances the information users would like to have against:
- what they really need
- what is feasible to offer.

Obtaining, analyzing, storing, and delivering information is costly.
- firms must decide whether the value of the insight is worth the cost.

Question 6

The MIS figure

Answer 6

Assessing information needs —> developing needed information (internal databases, marketing intelligence, marketing research) —> analyzing and using information.

Question 7

Developing marketing information

Answer 7

Information needed can be obtained from
- internal databases
- competitive marketing intelligence
- marketing research

Question 8

Internal databases

Answer 8

Internal databases are collections of consumer and market information obtained from data sources within the company network.

Question 9

Competitive marketing intelligence

Answer 9

Competitive marketing intelligence is the systematic monitoring, collection, and analysis of publicly available information about consumers, competitors, and developments in the marketplace.

Techniques:
- observing consumers first-hand
- quizzing the company’s own employees
- benchmarking competitors’ products
- conducting online research
- monitoring social media buzz

Offers insights about consumer opinions and their association with the brand.
Provides early warnings of competitor strategies and potential competitive strengths and weaknesses.
Helps firms to protect their own information.
Raises ethical issues.

Question 10

Marketing research

Answer 10

Systematic design, collection, analysis, and reporting of data relevant to a specific marketing situation facing an organization.

Question 11

The marketing research process

Answer 11

1. Defining the problem and research objectives
2. Developing the research plan for collecting information
3. Implementing the research plan — collecting and analyzing the data
4. Interpreting and reporting the findings.

Question 12

Defining the problem and research objectives

Answer 12

Exploratory research (exploring the issue):
- used to gather preliminary information.
- helps to define problems and suggest hypotheses.

Descriptive research:
- used to better describe the market potential for a product or the demographics and attitudes of consumers.
- probes more systematically into the problem and basis it’s conclusions on larger numbers of observations.

Causal research:
- used to test hypotheses about cause-and-effect relationships.

Question 13

Research plan

Answer 13

Outlines sources of existing data.

Spells out:
- specific research approaches
- contact methods
- sampling plans
- instruments that researchers will use to gather new data

Should be presented in a written proposal.

Topics covered in a research plan:
- problems and research objectives
- information to be obtained
- how results will help decision making
- estimated research costs
- type of data required

Question 14

Secondary data

Answer 14

Advantages: low cost, obtained quickly, cannot collect otherwise.
Disadvantages: potentially irrelevant, inaccurate, dated, biased.

Question 15

Planning primary data collection

Answer 15

1. Research approaches: observation, survey, experiment.
2. Contact methods: mail, telephone, personal, online.
3. Sampling plan: sampling unit, sample size, sampling procedure.
4. Research instruments: questionnaire, mechanical instruments.

Question 16

Research approaches

Answer 16

1. Observational research: gathering primary data by observing relevant people, actions, and situations.
   - Ethnographic research: sending trained observers to watch and interact with consumers in their natural environments.
2. Survey research: asking people questions about their knowledge, attitudes, preferences, and buying behaviour.
3. Experimental research: selecting matched groups of subjects, giving them different treatments, controlling related factors, and checking for differences in group responses.

Question 17

Contact methods

Answer 17

1. Mail questionnaires are used to collect large amounts of information at a low cost per respondent.
2. Telephone interviewing gathers information quickly, while providing flexibility.
3. Personal interviewing methods include: individual interviewing, group interviewing.
4. Online —> data is collected through: internet surveys, online focus groups, web-based experiments, tracking consumers’ online behaviour.

Question 18

Online behavioural and social tracking and targeting

Answer 18

Online listening: provides valuable insights into what consumers are saying or feeling about a brand.

Behavioural targeting: uses online consumer tracking data to target advertisements and marketing offers to specific consumers.

Social targeting: mines individual online social connections and conversations from social networking sites.

Question 19

Sampling plan

Answer 19

A sample is a segment of the population selected to represent the population as a whole.

Decisions required for sampling design:
- sampling unit: people to be studied —> should be representative of the population.
- sample size: number of people to be studied —> larger = more reliable but at a cost.
- sampling procedure: method of choosing the people to be studied —> two basic approaches: probability vs non-probability sampling.

Question 20

Probability sample

Answer 20

Simple random sample: every member of the population has a known and equal chance of selection.
Stratified random sample: the population is divided into mutually exclusive groups (such as age groups), and random samples are drawn from each group.

Cluster (area) sample: the population is divided into mutually exclusive groups (such as blocks), and the researcher draws a sample of the groups to interview.

Question 21

Nonprobability sample

Answer 21

Convenience sample: the researcher selects the easiest population members from which to obtain information.

Judgment sample: the researcher uses his or her judgment to select population members who are good prospects for accurate information.

Quota sample: the researcher finds and interviews a prescribed number of people in each of several categories.

Question 22

Implementing the research plan

Answer 22

Data collection: researchers should guard against various problems
- techniques and technologies
- data quality
- timeliness

Processing the data: check for accuracy, code for analysis.

Analyzing the data: tabulate results, compute statistical measures.

Question 23

Interpreting and reporting findings

Answer 23

Responsibilities of the market researcher: interpret the findings, draw conclusions, report findings to management.

Responsibilities of managers and researchers: work together closely when interpreting research results, share responsibility for the research process and resulting decisions.

Question 24

Customer relationship management (CRM)

Answer 24

Managing detailed information about individual customers.

Carefully managing customer touch points to maximize customer loyalty.

Consists of software and analysis tools that:
- integrate customer information from all sources.
- analyze data in depth
- apply the results.

Question 25

Marketing analytics

Answer 25

Marketing analytics consists of the analysis tools, technologies, and processes by which marketers dig out meaningful patterns in big data to gain customer insights and gauge marketing performance.