Marketing Information System
The marketing information system refers to the use of technology for the arrangement of the relevant data related to the market, sales, promotion, price, competition, and allocation of goods and services.
This information is acquired after a proper analysis and understanding of the marketing environment to ensure effective decision making in the organization.
Characteristics of Marketing Information System
Computer-Based System: In the marketing information system, all the information is gathered, analyzed and communicated through a computer device.
Quick, Selective and Accurate Information: The organization can maintain relevant marketing database which can be immediately and accurately accessed anytime.
Easy Accessibility: The information maintained with the help of the marketing information system can be easily viewed and utilized.
Inter-related Components: In marketing decisions and communication, all four components are inter-linked, i.e., internal report, marketing research, marketing intelligence, and marketing decision support systems.
Future-Oriented: The marketing information system initiates strategy formulation and planning for future marketing operations.
Supports Decision Making: Since this system provides an accurate marketing database, it can be certainly used for instantaneous decision making.
Applicable at all Levels of Management: Every manager uses the marketing information system to decide marketing strategies, plans, policies, and procedures.
Components of Marketing Information System
Internal Reporting System
The data available in the internal business records available in the various books of accounts on the sales, cash flows, receivables, payables, stock, research, marketing personnel, and cost is recorded, analyzed, monitored, compared and communicated to the relevant departments involved in decision making.
Marketing Research System
A marketing research system is an advanced tool that studies the perceived marketing issue or problem. It is done with the help of primary or secondary data collected and presented in tabular format, to draw meaningful conclusions.
It helps decision-makers with possible solutions and proposes multiple marketing opportunities.
Marketing Intelligence System
The marketing intelligence system collects, analyzes and keeps the organization aware of the daily updates.
These updates include external marketing environment, recent trends, developments, transforming customer needs, technological advancement, competitor’s strategy, and market conditions. This leads to prepare for the upcoming challenges and plan for future business opportunities.
Marketing Decision Support System
In the marketing decision support system, various mathematical and economic tools (regression, linear programming, optimization, statistics, time series analysis, etc.) are used to process, analyze and convert the raw data to obtain useful marketing information to support the decision-making activities.
Types of Marketing Decisions
The marketing information system is all about making a correct decision by the marketing personnel at the right time to serve the organizational objectives.
Following are the major marketing decisions:
The higher-level managers make such decisions since these are related to the organizational objectives, structure and policies which are crucial and affects the whole organization.
E.g. Decisions concerning new market acquisition.
These are the fundamental managerial decisions which are taken as corrective actions (by middle-level managers). This preceded by proper evaluation and monitoring of the implementation of the strategic plans.
E.g. adopting a suitable marketing strategy for potential market acquisition.
These decisions deal with the day to day activities performed for the accomplishment of specific tasks (such as proper utilization of resources), for adequate implementation of the plans formed by top and middle-level managers.
E.g. directing the efforts of the sales team towards the successful application of the marketing strategy.
Marketing Information System Process
The steps includes are:
- Establish suitable marketing metrics: Marketing Metrics are measurable values used by marketing teams to demonstrate the effectiveness of campaigns across all marketing channels. e.g. ROAS (Return On Advertising Spend), CLV (Customer Lifetime Value), etc.
- Collect relevant data from internal & external sources
- Plot data on graphs to visualize changing trends
- Communicate the information to the relevant department
- Decide the best possible course of action
Importance of Marketing Information System
Fills up Information Gap: Marketing information system facilitates the companies involved in international trade practices. The purpose is to meet their information needs and being aware of the world-wide scenario.
Facilitates Decision Making: It is a useful tool for future decision making involving the strategic, operational and control related decisions.
Marketing Planning: Marketing information system assesses the market demand and prospective sales to ensure effective planning of the marketing operations.
Competing Over Non-Price Factors: It facilitates brand image, product customization, product differentiation, public relations, additional services, etc., to retain consumers without any price war.
Demand Creation and Fulfilment: It also provides information on customer requirements. Thus, generating the need for those products which are desired by the consumer’s subconscious mind.
Saves Cost and Time: Marketing information system targets the problem area and take desired decisions to avoid the wastage of time, cost and efforts.
Systematic Recording of Data: It provides for an orderly arrangement of the gathered data to provide useful information.
Better Evaluation and Control: Marketing information system helps in taking corrective actions in case of not achieving the desired outcomes.
Coping Up with Marketing Environment and Trends: It regularly keeps an eye on any changing trends in the economic, political, technological and competitive environments. It helps to grab new opportunities and prepare for the upcoming challenges.