Topic 3: Managing marketing information

1. Presentation
To design marketing strategies, we need to know and understand the market, and to
have relevant information on vital elements of it, such as consumers, products and
competitors.
Knowing these aspects means obtaining data. Therefore, we are now going to analyse
how companies can obtain this information and, more importantly, how they manage
it – in other words, how they gain knowledge about the market to enable them to
make the right decisions.

2. The marketing information system

Knowledge of the market and consumers is vital for marketers, as it enables them to
design good marketing programmes and to make the right decisions.
Information has no intrinsic value without analysis; the value is found in the
knowledge we extract from it and how marketers use it for making decisions.
These days it is easy to obtain market information; thanks to the new technologies,
companies can obtain information from many sources. Consumers themselves
generate tonnes of data through their mobile phones, tablets, social networks, apps, e-
commerce, videos, geolocation, etc.
In fact, we have gone from market information being hard to find, to having too much
of it. Therefore, now the challenge is knowing how to extract the most relevant
information and use it to produce useful knowledge.
To manage this information, companies usually have a marketing information system:
people and procedures which look for information needs, obtain the necessary
information and transform it into useful information for the company’s decision-
makers.

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 3. The process of the marketing information system
The first step is to assess your information needs; it is important to make an honest
analysis of these needs in order to avoid casting your net too wide and ending up with
an information overload.
Once you have decided what information you need, the second phase begins:
searching for that information. Marketers can obtain data from various sources:

• Internal databases: electronic collections of information on customers and

markets obtained from sources of data on the company’s own network.
• Competitive intelligence: systematically monitoring, gathering and analysing
information in the public domain on consumers, competitors and market
trends. This can be done by first-hand observation of consumers, interviews in
the sales network, comparative analysis of competitors’ products, monitoring
social networks, talking to suppliers, etc.
• Commercial research: the systematic design, gathering, analysis and
presentation of information on a specific marketing situation/problem facing
an organisation.
When you have the information, the next phase is to extract value from it: information
analysis. To analyse the information, marketers can rely on their own expert
knowledge or use analytical models such as CRM or Big Data.

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 • CRM: software which integrates customer information obtained from the
customer’s points of contact with the company (purchases, sales staff,
customer services, websites, etc.)
• Big Data: tools which can find patterns in large amounts of data.
All the obtained and analysed information has no value until it is used for decision-
making and, therefore, the marketing information system must bring this information
to executives, usually in the form of reports.

4. Commercial research
As well as internal information and data obtained through in-house resources,
marketers usually need formal studies of specific situations and decisions, which is
where commercial research comes into play.
Commercial research is the systematic and objective search for and analysis of
information of relevance for identifying and solving a marketing situation or
problem.
The information obtained by means of commercial research must meet several
requirements:

• Reducing uncertainty
• Being a potential influence on decision-making
• Justifying its cost
Some large companies have their own commercial research departments, but it is
more usual to outsource this task to specialist researchers.
The commercial research process consists of several phases:
1. Defining the goals of the research: identifying the problem and establishing
the desired goals of the research at the start of the process.
2. Designing the research plan: defining the specific information to be searched
for, designing a plan for gathering it efficiently, and deciding on the sample and
research methodology to be used.
3. Obtaining the information: selecting the information sources, defining how the
information will be obtained (in person, by telephone, online), and selecting
the sample (its size and the sampling procedure).
4. Interpreting the results: the researcher reviews the information obtained and
then analyses and interprets the data in order to draw conclusions.
5. Drafting the report: the research process is reflected in a report to be
presented to the customer.

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 Commercial research involves two types of analyses:

• Quantitative: this provides figures and statistics and is used to answer

questions about potential market demand, sales quotas, prices and sales
analysis. It is usually conducted through surveys and panels. We use this
methodology when we want an answer to the question “How many people do
or think X?”

• Qualitative: used in analysis of trends, attitudes, perceptions and opinions. The

most frequent techniques are in-person or phone interviews and group
meetings. We use this methodology when we want an answer to the question
“What do people do or think, and why?”
The research methodology you choose depends on whether representativeness or
depth is the priority; in other words, choosing between gathering data which can be
extrapolated quantitatively to a research population, or finding explanations for those
data.
Marketing research usually draws conclusions on large groups of customers based on
the study of a small group, the sample; this is a segment of the population selected to
represent the entire population in the context of commercial research.
The most important factor when selecting a sample is that it should be representative.
Therefore, you should ask the following questions:

• The sampling unit: who will be interviewed?

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 • Sample size: how many people?
• The method: how will the individuals in the sample be selected?
Commercial research can be useful for a wide range of applications:

• General: market structure, market potential, market segmentation, consumer

behaviour, analysis of strategic plans, analysis of competitors’ strategies,
market tests.
• Product: purchase and use, image, positioning, proof of concept, product
testing, sales model for new products.
• Price: pricing structure, price elasticity of demand, buyer’s price perception.
• Distribution: selection of distribution channels, location of points of sale,
design and decoration of points of sale.
• Sales: performance, motivation and compensation of sales staff; sales areas
and quotas.
• Advertising: message testing, selecting media, effectiveness of advertising,
company image.

5. Commercial research in small companies

All companies, whether large or small, need information on customers and markets in
order to make decisions; they may not require a marketing information system or
large-scale research, but there are many research techniques available for lower
budgets:

• Observation at the point of sale

• Informal polling of small samples
• Online surveys
• Searching for information online: analysing the websites and social network
presence of competitors, products and customers.

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