Marketing Management
MARKETING MANAGEMENT
ASSIGMENT
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Lecturer :
Bambang Purnomo, S.E., M.M.
R-008
MANAGEMENT DEPARTMENT
FACULTY OF ECONOMICS AND BUSINESS
UNIVERSITY OF JAMBI
2022
ASSIGNMENT
Explanation and samples of :
1. Collecting Marketing Information.
2. Scaning Marketing Environment in Business.
3. Doing a Marketing Research.
4. Marketing Forecast.
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1. Collecting Marketing Information.
To carry out the responsibilities of analysis, planning, implementation, and control, marketing managers need a Marketing Information System (MIS). The role of MIS is to assess the need for the required information, and distribute that information in a timely manner.
Every firm must organize and distribute a continuous flow of information to its marketing managers. A marketing information system (MIS) consists of people, equipment, and procedures to gather, sort, analyze, evaluate, and distribute needed, timely, and accurate information to marketing decision makers. It relies on internal company records, marketing intelligence activities, and marketing research. We’ll discuss the first two components here, and the third one in the next chapter.
The company’s marketing information system should be a mixture of what managers think they need, what they really need, and what is economically feasible. An internal MIS committee can interview a cross-section of marketing managers to discover their information needs.
* MIS has 3 main components :
1. Internal recording system, which includes information Cycle order to payment and reporting Sales information system.
2. Marketing intelligence system => a set of procedures and resources used by managers to obtain daily information about developments in the marketing environment.
3. The money marketing research system enables the systematic design, collection, analysis and reporting of data and findings relevant to a particular marketing situation. Database, data warehouse, and data control.
* Why MIS Is Important
1. Many opportunities are found by identifying trends (direction of sequence of events that have momentum and persistency) as well as megatrends (major changes in social, political, economic and technological fields that have a lasting impact.
2. In a rapidly changing global situation, marketers must monitor 6 major environmental forces: demographic, economic, natural, technological, political-legal, and socio-cultural.
3. In demography the marketer must observe the growth of the world population; changes in the age mix, ethnic composition and education level.
4. In the economic arena, marketers need to focus on income distribution and levels of forest savings, and the availability of credit.
5. In the socio-cultural arena, marketers must understand people's views of themselves, others, organizations, society, the environment, and the universe.
6. In the natural environment, marketers should observe the shortage of raw materials, rising energy costs and pollution levels, as well as the changing role of government in environmental protection.
7. In the technology arena, marketers must take into account the acceleration of technological change, innovation opportunities, R&D diversity, and increased government regulation caused by technological change.
8. In the political and legal environment, marketers must comply with various laws governing business practices and various groups with special interests.
* Sample
DuPont commissioned marketing studies to uncover personal pillow behavior for its Dacron Polyester unit, which supplies filling to pillow makers and sells its own Comforel brand. One challenge is that people don’t give up their old pillows: 37 percent of one sample described their relationship with their pillow as being like that of “an old married couple,” and an additional 13 percent said their pillow was like a “childhood friend.” Respondents fell into distinct groups in terms of pillow behavior: stackers (23 percent), plumpers (20 percent), rollers or folders (16 percent), cuddlers (16 percent), and smashers, who pound their pillows into a more comfy shape (10 percent). Women were more likely to plump, men to fold. The prevalence of stackers led the company to sell more pillows packaged as pairs, as well as to market different levels of softness or firmness.
Companies with superior information can choose their markets better, develop better offerings, and execute better marketing planning. The Michigan Economic Development Corporation (MEDC) studied the demographic information of its visitors and those of competing Midwestern cities to create a new marketing message and tourism campaign. The information helped MEDC attract 3.8 million new trips to Michigan, $805 million in new visitor spending, and $56 million in incremental state tax revenue over the period 2004–2008.
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2. Scaning Marketing Environment in Business.
Environmental scanning involves reviewing external sources and factors that impact the internal operations of a business. Its purpose is to identify potential sources to consult with or consider when making business decisions. Those involved in the decision-making process, including company leaders and executives, use it to understand issues that might impact the business overall. Examples of issues that could impact the success of an organization include the actions taken by competitors, the political landscape, regulatory changes and the overall environment in which the business operates.
As the name suggests, environmental scanning involves reviewing the environment in which an organization does business and looking at any areas of concern or future changes that may affect it. While many business leaders focus on market conditions and their industry, it's also important to consider social shifts, regulations and new technologies emerging in the marketplace. Marketing professionals can provide insights into the environment in which a business operates by performing regular environmental scanning and sharing the results with the leadership team.
* Components of environmental scanning in marketing
A business environment includes internal and external components. When performing environmental scanning in marketing, individuals must assess the external components to better understand the factors that may impact company's potential for success. The external components used in environmental scanning can be broken down further into micro-environmental factors and macro-environmental factors. Examples of micro-environmental factors include:
Consumers
Suppliers
Clients
Competitors
Other components that directly relate to business operations
Macro-environmental factors include:
Demographics
Technology
Economics
Legal regulations
Political climate
* Environmental scanning techniques used in marketing
Marketers use various techniques when performing environmental scanning, such as:
a. SWOT analysis
a swot analysis is a common method of environmental scanning. SWOT stands for strengths, weaknesses, opportunities and threats. When performa a SWOT analysis, the marketing department of an organization must look internally at the company's strengths and opportunities and externally at its weaknesses and threats.
b. Research
Performing research is one of the most commonly used techniques in environmental scanning. Many organizations across various industries rely on their own research to learn more about the political climate, legislative shifts, technological advancements and other potential changes that can impact the industry in which they operate. Research has become such a vital tool in the marketing and development processes that organizations often have their own research and development teams or departments that conduct internal research.
c. Expert opinions
Seeking the opinions of experts is a method of environmental scanning that can provide new insight into the industry or the way an organization operates. When using this technique, it's important to look for experts in the industry who listen to the conversations between other people and can decipher what trends or shifts may arise. Marketers might use this information when developing and creating their own strategies and approaches, and they might also use the data extracted from experts to emphasize or reinforce the points they're trying to make about a particular subject.
d. Industry analysis
An analysis of the industry in which a company operates is another technique used by marketers when performing environmental scanning. When analyzing the industry, one of the key areas of focus is competitors, both direct and indirect, of the organization. This technique helps a business to learn more about the strategies of competitors and determine what strategies is can use to compete against those companies.
e. PEST analysis
A PEST analysis provides insights into external macro-environmental factors, making it a useful technique for environmental scanning. The acronym stands for political, economic, social and technological. When performing a PEST analysis, marketing professionals will look for potential government shifts and other political factors as well as economic shifts that may impact the business. Social factors include how people are discussing the product and industry, while technological factors include any upcoming or shifting technology that could play a role in shaping the company's future.
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3. Doing a Marketing Research.
Market research is defined as the process of evaluating the feasibility of a new product or service, through research conducted directly with potential consumers. This method allows organizations or businesses to discover their target market, collect and document opinions and make informed decisions. Market research can be conducted directly by organizations or companies or can be outsourced to agencies which have expertise in this process.The process of market research can be done through deploying surveys, interacting with a group of people also known as sample, conducting interviews and other similar processes.
* Three key objectives of market research
A market research project may usually have 3 different types of objectives.
- Administrative: Help a company or business development, through proper planning, organization, and both human and material resources control, and thus satisfy all specific needs within the market, at the right time.
- Social: Satisfy customer’s specific needs through a required product or service. The product or service should comply with the requirements and preferences of a customer when it’s consumed.
- Economical: Determine the economical degree of success or failure a company can have while being new to the market, or otherwise introducing new products or services, and thus providing certainty to all actions to be implemented.
* Why is market research important?
Conducting research is one of the best ways of achieving customer satisfaction, reducing customer churn and elevating business. Here are the reasons why market research is important and should be considered in any business:
- Valuable information: It provides information and opportunities about the value of existing and new products, thus, helping businesses plan and strategize accordingly.
- Customer-centric: It helps to determine what the customers need and want. Marketing is customer-centric and understanding the customers and their needs will help businesses design products or services that best suit them. Remember that tracing your customer journey is a great way to gain valuable insights into your customers’ sentiments toward your brand.
- Forecasts: By understanding the needs of customers, businesses can also forecast their production and sales. Market research also helps in determining optimum inventory stock.
- Competitive advantage: To stay ahead of competitors market research is a vital tool to carry out comparative studies. Businesses can devise business strategies that can help them stay ahead of their competitors.
* Types of Market Research: Market Research Methods and Examples
Whether an organization or business wishes to know purchase behavior of consumers or the likelihood of consumers paying a certain cost for a product, market research helps in drawing meaningful conclusions.
Depending on the methods and tools required, following are the types:
1. Primary Market Research (A combination of both Qualitative and Quantitative Research): Primary market research is a process, where organizations or businesses get in touch with the end consumers or employ a third party to carry out relevant studies to collect data. The data collected can be qualitative data (non-numerical data) or quantitative data (numerical or statistical data).
As mentioned earlier primary market research is a combination of qualitative market research and quantitative market research. Qualitative market research study involves semi-structured or unstructured data collected through some of the commonly used qualitative research methods like:
Focus groups: Focus group is one of the commonly used qualitative research methods. Focus group is a small group of people (6-10) who typically respond to online surveys sent to them. The best part about focus group is the information can be collected remotely, can be done without personally interacting with the group members. However, this is a more expensive method as it is used to collect complex information.
One-to-one interview: As the name suggests this method involves personal interaction in the form of an interview, where the researcher asks a series of questions to collect information or data from the respondents. The questions are mostly open ended questions and asked in a way to facilitate responses. This method is heavily dependent on the ability and experience of the interviewer to ask questions that evoke responses.
Ethnographic research: This type of in-depth research is conducted in the natural settings of the respondents. This method requires the interviewer to adapt himself/herself to the natural environment of the respondents which could be a city or a remote village. Geographical constraints can be a hindering factor in conducting this kind of research. Ethnographic research can last from a few days to a few years.
2. Secondary Market Research: Secondary research uses information that is organized by outside source like government agencies, media, chambers of commerce etc. This information is published in newspaper, magazines, books, company website, free government and nongovernment agencies and so on. Secondary source makes use of the following:
Public sources: Public sources like library are an awesome way of gathering free information. Government libraries usually offer services free of cost and a researcher can document available information.
Commercial sources: Commercial source although reliable are expensive. Local newspapers, magazines, journal, television media are great commercial sources to collect information.
Educational Institutions: Although not a very popular source of collecting information, most universities and educational institutions are a rich source of information as many research projects are carried out there than any business sector.
* Steps for conducting Market Research
Knowing what to do in various situations that arise during the investigation will save the researcher’s time and reduce problems. Today’s successful enterprises use powerful market research survey software that helps them conduct comprehensive research under a unified platform and hence provide actionable insights much faster with fewer problems.
Following are the steps to conduct an effective market research.
Step #1: Define the Problem
Having a well-defined subject of research will help researchers when they ask questions. These questions should be directed to solve problems and they have to be adapted to the project. Make sure the questions are written clearly and that the respondents understand them. Researchers can conduct a test with a small group to know if the questions are going to know whether the asked questions are understandable and will they be enough to gain insightful results.
Step #2: Define the Sample
To carry out market research, researchers need a representative sample that can be collected using one of the many sampling techniques. A representative sample is a small number of people that reflect, as accurately as possible, a larger group.
- An organization cannot waste their resources in collecting information from the wrong population. It is important that the population represents characteristics that matter to the researchers and that they need to investigate, are in the chosen sample.
- Take into account that marketers will always be prone to fall into a bias in the sample because there will always be people who do not answer the survey because they are busy, or answer it incompletely, so researchers may not obtain the required data.
- Regarding the size of the sample, the larger it is, the more likely it is to be representative of the population. A larger representative sample gives the researcher greater certainty that the people included are the ones they need, and they can possibly reduce bias. Therefore, if they want to avoid inaccuracy in our surveys, they should have representative and balanced samples.
- Practically all the surveys that are considered in a serious way, are based on a scientific sampling, based on statistical and probability theories.
There are two ways to obtain a representative sample:
- Probability sampling: In probability sampling, the choice of the sample will be made at random, which guarantees that each member of the population will have the same probability of selection and inclusion in the sample group. Researchers should ensure that they have updated information on the population from which they will draw the sample and survey the majority to establish representativeness.
- Non-probability sampling: In a non-probability sampling, different types of people are seeking to obtain a more balanced representative sample. Knowing the demographic characteristics of our group will undoubtedly help to limit the profile of the desired sample and define the variables that interest the researchers, such as gender, age, place of residence, etc. By knowing these criteria, before obtaining the information, researchers can have the control to create a representative sample that is efficient for us.
Step #3: Carry out data collection
First, a data collection instrument should be developed. The fact that they do not answer a survey, or answer it incompletely will cause errors in research. The correct collection of data will prevent this.
Step #4: Analyze the results
Each of the points of the market research process is linked to one another. If all the above is executed well, but there is no accurate analysis of the results, then the decisions made consequently will not be appropriate. In-depth analysis conducted without leaving loose ends will be effective in gaining solutions. Data analysis will be captured in a report, which should also be written clearly so that effective decisions can be made on that basis.
Step #5: Make the Research Report
When presenting the results, researchers should focus on: what do they want to achieve using this research report and while answering this question they should not assume that the structure of the survey is the best way to do the analysis. One of the big mistakes that many researchers make is that they present the reports in the same order of their questions and do not see the potential of storytelling.
Step #6: Make Decisions
4. Marketing Forecast.
A marketing forecast is an analysis that projects the future trends, characteristics and numbers in your target market. It provides anticipated numbers that a company expects based upon market research.
Marketing forecasts help you understand how many leads your company will generate within a specific period of time and how the leads will move through the different stages of your lead nurturing process before they are ready to make a purchase. It helps you understand which marketing channels will generate the most leads and how sales likely will perform. By understanding how many prospective customers are in each stage of the revenue cycle and how they move through each stage, you can estimate how many new opportunities and customers you will generate in the future.
* Why is forecasting important?
Businesses need to create marketing plans to determine their strategic directions. A marketing forecast is at the core of the marketing plan since it predicts the results and revenue the business will achieve.
* Components of a marketing forecast
There are a few components that markets require to produce accurate forecasts, including:
a. Accurate data
The first component marketers need is good data. If the data they're using varies significantly, then the forecasting methods won't produce accurate results. If the different channels they're using have errors, the forecasts will ultimately be inaccurate and markers may miss their goals. By starting with accurate data, marketers can minimize forecasting errors and use more advanced forecasting methods.
b. Market size
Market size is another component of a marketing forecast. The market size refers to the number of people in a particular market segment who are potential buyers. Companies need to examine market size to accurately complete a marketing forecast.
c. Target focus
A marketing analysis should allow you to develop a strategic focus within the market. This is also referred to as segmentation and positioning. As you choose the market segments that are best for your product or service, consider your own strengths and weaknesses, the competitive advantage that your company has and the inherent differences between the market segments.
d. Processes for completing a marketing forecast
A marketing forecast is ultimately an educated guess about what could happen based on an elaborate process. However, there are several different processes you could use to complete your marketing forecast:
e. Executive opinion
This is essentially when company executives make educated guesses based on their knowledge of the company, market, sales and other factors. It is often a starting point for many marketing forecasts. That said, executive opinions should always be supported by research and qualitative techniques.
f. Customer or channel surveys
Using this approach, companies employ research organizations that can survey potential customers about how much they likely would spend on specific types of products within a set period of time. Those companies then use the answers to make marketing forecasts. Companies also sometimes conduct their own surveys to create marketing forecasts. The downside is that while surveys are effective at determining market potential, they are less so at determining sales potential, as the potential consumer could buy products from competitors.
g. Sales force composite
Another method of completing a marketing forecast is to gather information from a company's sales force. Sales representatives often have a strong intuition about how much product they can sell within a specific amount of time, although this typically only works well with existing products. This method of forecasting isn't well-suited for new products.
h. Expert opinion
This method of forecasting is similar to using executive opinions. The primary difference between the two is that you rely on the opinions of experts from outside the company. These opinions should always be supported by qualitative methods and research.
i. Correlates techniques
A correlational analysis is a sophisticated method of completing a marketing forecast. Using this method, you base your sales forecasts on the patterns of other related variables.
j. Time series techniques
These techniques are useful for observing patterns in sales. Trend analysis, for example, allows you to measure the increase in sales over time and apply it to the future to predict company growth. If your company saw an increase in sales of 3% in the past year, as an example, it's reasonable to assume that the 3% increase will continue in the future.
k. Response models
Using this method, a company bases its forecasts on the past responses of customers to specific marketing techniques. Using this information, the company can make educated guesses about how customers will respond to changes in pricing or different offers.
* How to use a marketing forecast
While the specific steps that a company uses to create an accurate marketing forecast can be quite sophisticated, the basic methodology is simple in concept. Here are the basic steps companies need to take to complete a marketing forecast:
Identify the stages of your revenue cycle
Determine the types of leads that you want to track
Measure how the different types of leads move through the different stages of the revenue cycle
Use accurate data to determine how many new leads will go into the system within a set amount of time
Model the flow of new and current leads
Review your results and finalize your marketing forecast
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