Chapter 5

Understanding Markets, Market Demand, and the Marketing Environment

PowerPoint by Yu Hongyan Business School of Jilin University

What Types of Decisions Do Marketers Make?

Example: Restaurant to be located in the Qianjin Square (location decision) Here are some marketing decisions we need to make

Target options- JLU; shopper OR Tourists Menu Breakfast; Lunch; Dinner; AND/OR Late Night Sit down OR fast food (or takeout/delivery) Prices Super Cheap, Cheap, Average, High, OR Super High How to advertise?

Objectives

Marketing Information System Demand measurement and forecasting Microenvironmental Trends and Forces

Marketing Information System

It is defined as . . .
people, equipment, and procedures that gather, sort, analyze, evaluate, and distribute needed, timely, and accurate information to marketing decision makers.

Marketing Information System

Marketing Environment

Developing Information
Marketing Managers Analysis Planning Implementing Controlling

Assessing information needs

Internal reports

Marketing intelligence

Target markets Marketing channels Competitors

Distributing information

Marketing decision support analysis

Publics

Marketing research

Macroenvironment forces

Marketing Decisions and Communications

Marketing Information System (contd)

Internal Records Systems

Order-to-payment cycle is key Timely sales reports help to better manage inventory Customer, product, salesperson and other databases can be mined for fresh insights VMIvendor-managed inventory)

Marketing Information System (contd)

Marketing intelligence system

A set of procedures and sources used by Manager?????? Not result data but happenings data Collect information by:

Reading books,newspaper, trade publications; Talking to customers, supplies, and distributors; Checking Internet sources, Meeting with other company managers

Marketing Information System (contd)

Training and motivating the sales force
Motivating channel members to share info Collecting competitive intelligence Buying info from commercial data sources Developing a customer advisory panel

Improving the quality of marketing intelligence

Establishing a marketing information center

Marketing Information System (contd)

Marketing Research

As the systematic design,collection, analysis, and reporting of data and findings that are relevant to a specific marketing situation facing the company

Marketing Information System (contd)

Marketing Research is

the process of designing, gathering, analyzing and reporting of information that may be used to solve a specific marketing problem.

Burns and Bush, 2000

Marketing Information System (contd)

Marketing Research

The Structure of The MR Industry

Internal Suppliers

Have their own formal departments at least a single individual responsible for marketing research Have their own formal marketing research department

Marketing Information System (contd)

Marketing Research

External Suppliers Syndicated Services research firm: Infoscan Custom marketing research firms Specially-line marketing research firms

Field Services Market Segment Specialists Data Entry Services Sample Design & Distribution Services Data Analysis Services Specialized Research Technique Services

Marketing Information System (contd)

The Marketing Research Process

Marketing Information System (contd)

Marketing Research

A case of marketing research Taxi mobile

Invitation Marketing proposal Qualitative research:focus group Quantitives research:mall intercept interview Data edit in Spss or excel Written Report and oral report

Marketing Information System (contd)

Marketing research

Step 1 Define the problem and research objective

Problem:??? Objective:

Brand awareness Usage of mobile New concept of tax driver mobile Exploratory research Descriptive research Causal research

The kinds of Marketing research

Marketing Information System (contd)

Marketing research

Step 2 Develop the research plan

Decisions on Data Sources Research Approaches Research Instruments Sampling Plan Contact Methods

Data Sources

Primary data Secondary data, look at the book For taxi case, which is primary data and which is secondary data?

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Research Approaches
Observational
Focus-group Survey

Behavioral
Experimental

Research Instruments

Laddering techniques

Laddering techniques involve the creation, reviewing and modification of hierarchical knowledge, often in the form of ladders (i.e. tree diagrams).

Sampling Plan

Sampling unit: Sample size: Sampling procedure

Probability sampling Unprobability sampling

Contact Methods

In home interview Mall intercept interview Traditional telephone interview Computer assisted telephone interview CATI Mail survey Drop off survey On-line interview

Marketing Information System (contd)

Marketing Research

Step 3 Collect information Field work Step 4 Analyze the information Tabulate the data

Statistical technique

Frequency Chart Mean, mode, and correlation, regression

Step 5 present the findings Presentation

Marketing Information System (contd)

Marketing Decision Support System (MDSS)

It is defined as . . .
A coordinated collection of data, systems, tools, and techniques with supporting software and hardware by which an organization gathers and interprets information from businesses and the environment and turns it into a basis for marketing action.

2. Forecasting and Demand Measurement

Market Measurement Demand Measurement Estimating Current Demand Estimating Future Demand

2. Forecasting and Demand Measurement (contd)

Essential Aspects

Please give EX.

The market Market demand Company demand and sales forecasts Current demand Future demand

Market Potential market Available market Target market (served market) Qualified available market Penetrated market

2. Forecasting and Demand Measurement (contd)

What will you do when not satisfied Try to attract more buyers from its target market Lower the qualification of potential buyers Expand its available market by adding distribution or lowering price Try to expand the potential market by advertising to prospect

2. Forecasting and Demand Measurement (contd)

Demand Measurement

Figure 5-2: Market Demand Functions

2. Forecasting and Demand Measurement (contd)

Essential Aspects

Market demand

The market Measuring demand Company demand and sales forecasts Current demand Future demand

Market minimum Market forecast Market potential

Market forecast Market potential

2. Forecasting and Demand Measurement (contd)

Essential Aspects

The market Measuring demand Company demand and sales forecasts Current demand Future demand

Company demand Company sales forecast Sales quota Sales budget Company sales potential

2. Forecasting and Demand Measurement (contd)

Essential Aspects

The market Measuring demand Company demand and sales forecasts Current demand Future demand

Total market potential Area market potential

Market-buildup method

2. Forecasting and Demand Measurement (contd)

Essential Aspects

The market Measuring demand Company demand and sales forecasts Current demand Future demand

Many Forecasting Methods:

Buyer intentions survey Composite of sales force opinions Expert opinion Past-sales analysis Market-test method

3. Macroenvironmental Trends And Forces

Demographic
Ethnic Markets

Environment

Population Age Mix Educational Groups

Household Patterns Rise of Micromarkets

Geographic Population Shifts

Worldwide Populations Growth

3. Macroenvironmental Trends And Forces (contd) Economic Environment

Income Distribution

Savings, debt, and credit availability

3. Macroenvironmental Trends And Forces (contd)

Natural Environment
Changing role of governments Shortage of raw materials

Anti-pollution pressures
Increased energy costs

3. Macroenvironmental Trends And Forces (contd)

Accelerating pace of technological change

Unlimited opportunities for innovation

Technological Environment

Varying R&D budgets

Increased regulation of technological change

3. Macroenvironmental Trends And Forces (contd) Political-Legal Environment

Legislation regulating business

Growth of special interest groups

3. Macroenvironmental Trends And Forces (contd)

Socio-Cultural Environment
World views held by consumers
High persistence of core values Existence of subcultures

Thank you very much!