Marketing Information System

1. By- Prachi Agarwal

2. What is MKIS?
 A marketing information system (MKIS) is a management
information system (MIS) designed to
support marketing decision making. Jobber (2007) defines it as a
"system in which marketing data is formally gathered, stored,
analysed and distributed to managers in accordance with their
informational needs on a regular basis." In addition, the online
business dictionary defines Marketing Information System
(MKIS) as "a system that analyzes and assesses marketing
information, gathered continuously from sources inside and
outside an organization or a store."Furthermore, "an overall
Marketing Information System can be defined as a set structure
of procedures and methods for the regular, planned collection,
analysis and presentation of information for use in making
marketing decisions." (Kotler, at al, 2006)

3. Components of MIS
 MIS is made of parts, subparts or subsystems which
are called the components. Typically, according to
Philip Kotler, a marketing information system consists
of four interrelated components – Internal Reports
(Records) System, Marketing Research System,
Marketing Intelligence System, and Marketing
Decision Support System, as shown in Figure

5. 1. Internal Records System:
 Internal records system is a major and easily accessible source of
information. It supplies the results data. It consists of all records
of marketing operations available within organisation. This
system concerns with collecting, analyzing, interpreting, and
distributing needed information from records of various
departments of the company.
 Main sources include various records on sales and purchase,
ordering system, sales force reporting system, inventory level,
receivable-payables, marketing staff, costs, the past research
works, and other literatures/reports available within
organisation. Particularly, for sales orders and sales force
reporting, the computer technology is excessively used for
accurate, efficient, and speedy transmission of information.

6. 2. Marketing Intelligence System:
 Marketing intelligence system is:The set of procedures and sources
used by managers to obtain every-day information regularly about
pertinent developments in the marketing environment. A manager can
try to expose external environment in various ways.
Marketing intelligence system consists of various methods.
 A manager can use one or more below mentioned methods:
 i. Reading newspapers, books, and other publications.
 ii. Watching TV, hearing radio, or Internet surfing.
 iii. Talking to customers, dealers, suppliers, and other relevant parties.
 iv. Talking to other managers and employees of his company as well as
of other companies.
 v. Maintaining live contacts with other officials and agencies.
 vi. Purchasing useful information from professional sources.
 vii. Assigning marketing intelligence task to professional agencies, etc.

7. 3. Marketing Research System
 Marketing research is a powerful and independent branch of the MIS.
In certain cases, managers need detailed information on the specific
problem of the specific marketing area. Thus, it is a formal study of
specific problems, opportunities, or situations. Normally, it is carried
out for solving the specific problem.
 In this sense, it is not a part of routine activity. It collects need-based
information. Nowadays, it is treated as the separate discipline or
subject. Philip Kotler defines: “Marketing Research is the systematic
design for collection, analysis, and reporting of data and findings
relevant to specific marketing situations facing the company.”
 Marketing research consists of collecting primary and secondary data
from various respondents using various tools through various methods
for definite period of time, analyzing data using appropriate statistics
tools, and presenting findings in forms of a report. It is conducted by
internal expert staff or external professionals.

8. 4. Marketing Decision Support System (MDSS):
 Previously, the component was known as Analytical Marketing System. While
former three components supply data, the marketing decision support system
concerns more with processing or analyzing available data. This component
can improve efficiency and utility of the whole marketing information system.
 The system is used to help managers make better decisions. John D. C. Little
defines: “A marketing decision support system (MDSS) is coordinated
collection of data, systems, tools, and techniques with supporting software and
hardware by which an organisation gathers and interprets relevant information
from environment and turns it into a basis for making decisions.”
 According to the definition, the MDSS includes tools, techniques or
models used for:
 Data collection,
 Data analysis,
 Interpreting results, and
 Supporting managerial decision-making.

9. Advantages of Marketing
Information Systems
 Organized Data collection – Lots of data can be collected from the
market. But the main word here is “Organized”. Organizing data is very
important else the data is meaningless. Thus MIS helps you to organize
your database thereby improving productivity.
 A broad perspective – With a proper MIS in place, the complete
organization can be tracked which can be used to analyse independent
processes. This helps in establishing a broader perspective which helps
us know which steps can be taken to facilitate improvement.
 Storage of Important Data – Several times in pharmaceuticals, when
one drug is being produced they may need data of another drug which
was produced years back. Similarly in Media, photographs are stored in
archives. This storage of important data plays a crucial role in execution
and thus proves again that MIS is not important only for information
but also for execution.

10.  Avoidance of Crisis – The best way to analyse a stock (share market) is to see
its past performance. Top websites like moneycontrol thrive on MIS. Similarly
MIS helps you keep tracks of margins and profits. With an amazing
information system established, you can know where your organization is
moving and probably avert a crisis long before it has taken place. Ignoring
hints received from MIS reports is foolhardy.
 Co-ordination – Consumer durables and FMCG companies have huge
number of processes which needs to be co-ordinated. These companies depend
completely on MIS for the proper running of the organization. There are
dedicated people for marketing information systems in such organizations.
This is mainly because of the speed required to access information and
implement it.
 Analysis and Planning – MIS is critical for planning. You cannot do planning
without information. For planning, the first thing which is needed is the
organizations capabilities, then the business environment and
finally competitor analysis. In a proper MIS, all these are present by default and
are continuously updated. Thus MIS is very important for planning and
analysis.

11. Types of Management Information Systems
 Management Reporting System-A management reporting system is a
database designed to report on the finances and operations of all levels of
management in an organization. A company's management reporting system is
commonly used by middle managers to generate regular reports comparing
current and past financial performance to determine financial growth and to
track how the middle managers themselves are performing. Upper
management uses the data generated by the reporting system to compare the
company's current financial position and its efficiency of operations against its
predetermined goals for the company.
 Process Control-A process control system monitors a business's physical or
industrial processes such as metal fabrication, petroleum processing or
automobile assembly. The control system is constantly collecting data and is
programmed to generate regular reports on system performance. A manager
looks to the process control reports to tell how often, over the course of a set
period of time, a particular event occurs during the production process, or how
often over that period of time the company deviated from a repetitive
production process. This information is key to tracking the overall efficiency of
production and the safety of machinery and employees.

12.  Sales and Marketing-A sales and marketing system supports management in
executing and tracking the effectiveness of the organization's sales and
marketing functions. These include:
o developing products
o forecasting sales
o compiling and tracking the advertising outlets and schedules
o managing distribution channels
o pricing, discounts and promotions
o implementing effective advertising and sales promotions .
 Inventory Control-The inventory control system tracks everything having to
do with inventory, including sales, spoilage, theft, and inventory on hand,
which allows management to determine when individual items are getting low
and need restocking, either in the company's warehouse or in any of its
individual retail locations. It tracks movement of inventory into the warehouse,
from warehouse to store, store sales and returns.

13.  Human Resources(Office Automation/Enterprise
Collaboration)
 An office automation, or enterprise collaboration, information
management system enables managers to control the flow of
information throughout the organization. Any electronic
communication device or medium used in the organization by
managers to communicate with other managers, with their
employees, or for employees to communicate with each other
falls under the umbrella of the office automation information
system. These devices and media can include land-line phones,
cell phones, Internet, Intranet, multimedia, voice mail and
email, file sharing and video conferencing.


14. Marketing Research
 Marketing research is "the process or set of processes that links the
producers, customers, and end users to the marketer through information used
to identify and define marketing opportunities and problems; generate, refine,
and evaluate marketing actions; monitor marketing performance; and improve
understanding of marketing as a process. Marketing research specifies the
information required to address these issues, designs the method for collecting
information, manages and implements the data collection process, analyzes
the results, and communicates the findings and their implications."
 It is the systematic gathering, recording, and analysis
of qualitative and quantitative data about issues relating to marketing products
and services. The goal of marketing research is to identify and assess how
changing elements of the marketing mix impacts customer behavior. The term
is commonly interchanged with market research; however, expert practitioners
may wish to draw a distinction, in that market research is concerned
specifically with markets, while marketing research is concerned specifically
about marketing processes.

15. Types of Marketing Research

16.  Exploratory Market Research: The researcher uses the exploratory research
when he has a very little information about the research problem and needs to
gain insights about it before finding the solutions to it. It requires the
researcher to clear his concept, gain insights, formulate problems, eliminate
impractical ideas and formulate a hypothesis to check the relevancy of the
research design.This can be done by using the secondary data, i.e. information
available both inside and outside the organization, conducting observational
studies, consulting experts, and processing feedback from the marketplace and
surveys.
 Descriptive Market Research: The descriptive research is concerned with
testing the hypothesis to find out the accurate answers of the research
problem. Such as, who are the prospective buyers of the product?, How the
products are consumed?, What fraction of the population uses the product?,
What is the demand forecast? And who are the potential competitors?The
objective of the descriptive market research is to measure the frequency with
which the things occur and the extent to which the variables under study are
correlated

17.  Causal Market Research: The causal market research is
conducted to establish the cause-and-effect relationship
between the variables, such as if the packaging of the
product is changed then what will be its effect on the
product durability? Thus, this research is carried out to
explain the facts that why a certain change in one variable
is observed due to the change in the other.
 Predictive Market Research: As the name suggests, the
predictive research is conducted to forecast or predict
certain market variable for which the research is designed.
Such as predicting the future sales, projection of growth,
test market to predict the success of a new product,
defining of firm’s product line, etc.

18.  The marketing research can be further classified on
the basis of the type of data generated and the degree
of mathematical accuracy required as:
 Qualitative Market Research
 Quantitative Market Research

19. Qualitative Market Research
 Definition: The Qualitative Market Research deals with the
feelings, attitudes, opinions, and thoughts of an individual to ascertain
their underlying reasons for behavior. In other words, the research
conducted to determine what people think or feel about the situation
and what are the factors that influence their behaviors is called
qualitative market research.
 The purpose of the qualitative market research is to study the
psychology of an individual and obtain the insights and depth of
buyer’s perceptions, behavior, and needs. Majorly the organizations
carry out the qualitative research to identify the consumer perceptions,
such as
 What do they feel about a product?
 What they like or dislike about it?
 What are their expectations from a new product?
 What do they feel about the competitor’s product?
 What are the barriers that influence their purchase behavior?

20. Quantitative Market Research
 Definition: The Quantitative Market Research deals with the hard facts
and statistical data rather than the opinions, feelings, and attitudes of the
individuals. Here, the data are quantified to draw inferences about the
customer’s behavior, attitude and preferences in numerical terms that can be
easily interpreted and compared with other data facts.
 The quantitative market research is often used to determine what proportion of
the population possesses certain characteristics, attitudes, behaviors,
knowledge and then its significance level is checked using the statistical
analysis method. The quantitative research is based on large samples and
addresses questions as:
 How often customer buys the product?
 What proportion of the population makes job searches online?
 How many customers will buy a product if a certain promotional strategy is
introduced?
 How many customers rated the ambiance of the restaurant as ‘outstanding’.

21. Importance of Marketing Research
 Identifying problem and opportunities in the market:It
helps in identifying new market opportunities for existing and
new products. It provides information on market share, nature of
competition, customer satisfaction levels, sales performances
and channel of distribution. This helps the firms is solving
problems.
 Formulating market strategies:Today, markets are no more
local. They have become global. Manufactures find it difficult to
contact customers and control distribution channels.
Competition is equally severe. The consumer needs are difficult
to predict. Market segmentation is a complicated task in such
wide markets. The marketing intelligence provided through
marketing research not only helps in framing but also in
implementing the market strategies.

22.  Determining consumer needs and wants:Marketing has
become customer-centric. However, large-scale production
needs intermediaries for mass distribution. Due to
prevalence of multi channels of distribution, there is an
information gap. Marketing research helps in collecting
information on consumers from structured distribution
research and helps in making marketing customer
oriented.
 For effective communication mix:In an era of micro-
rather than mass-marketing, communication plays a vital
role. Marketing research uses promotional research to
study media mix, advertising effectiveness and integrated
communication tools. Research on such aspects will help in
promoting effectively a company’s product in the market.

23.  Improving selling activities:Marketing research is used to
analyse and evaluate performances of a company within a
market. It also studies effectiveness of a sales force. It helps in
identifying sales territories. Such information helps the
companies in identifying areas of shortcoming in sales. It also
examines alternative methods for distribution of goods.
 For sales forecasting:The most challenging task for any
production manager is to keep optimum levels of inventory.
However, production is undertaken in anticipation of demand.
Therefore, scientific forecast of sales is required. Marketing
research helps in sales forecasting by using market share
method, sales force estimate method and jury method. This can
also help in fixing sales quotas and marketing plans

24.  To revitalize brands:Marketing research is used to study
and find out the existing brand position. It finds out the
recall value of brands. It explores the possibilities of brand
extension or prospects of changing existing brand names.
The main purpose of marketing is to create brand loyalty.
Marketing research helps in developing techniques to
popularize and retain brand loyalty.
 To facilitate smooth introduction of new
products:Marketing research helps in testing the new
products in one or two markets on a small scale. This helps
in finding out consumer response to new product and
develop a suitable marketing mix. It reveals the problems
of the customers regarding new products. Thus, it controls
the risk involved in introducing a new product.

25. Thank you