Chapter 5 Textbook Summary.docx

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Western University
Management and Organizational Studies
Management and Organizational Studies 2320A/B
Kevin Thompson

Chapter 5  Companies use costumer insights to develop a competitive advantage o They don’t need more information, they need better information and they need to make better use of the information they have  Customer insights: fresh understandings of customers and the marketplace derived from marketing information that become the basis for creating customer value and relationships  Customer insight groups collect customer and market information from a wide variety of coursed o They then use the marketing information to develop important customer insights from which the company can create more value for its customers  Customer controlled – understand customers to the core and give them not what they need but to create value for customers as a means of capturing value for the firm in return  Marketing Information System (MIS): consists of people and procedures fro assessing informational needs, developing the needed information, and helping decision makers to use the information to generate and validate actionable customer and market insights o Assessing informational needs:  A good marketing information system balances the information users would like to have against what they really need and what is feasible to offer  Interview managers  MIS must monitor the marketing environment too provide decisions makers with information they should have to better understand customers and make marketing decisions  The company's MIS may not be advanced enough to forecast resulting changes in market shares  The costs of obtaining, analyzing, storing, and delivering information can mount quickly – the company must decide if the value of insights is worth the costs of providing it o Developing marketing information:  Marketers can obtain the needed information from internal date, marketing intelligence, and marketing research  Internal databases: electronic collections of consumer and market information obtained from data sources within the company's network o Usually can be accessed more quickly and cheaply than other information sources but they also present some problems – may be incomplete or in the wrong form of making marketing decisions  Marketing intelligence: the systematic collection and analysis of publicly available information about consumers, competitors, and developments in the marketing environment o The goal is to improve strategic decision making by understand the consumer environment, assessing and tracking competitors actions, and providing early warnings of opportunities and threats o Techniques range from monitoring the Internet to observing consumers firsthand o Gain insights into how consumers talk about and connect with their brands o Companies also need to actively monitor their competition – firms use competitive intelligence to gain early warnings of competitor moves and strategies, new product launch, new or changing markets, and potential competitive strengths and weaknesses o Intelligence seekers can also pore through any online databases – some are free o The growing use of marketing intelligence raises a number of ethical issues  Marketing Research: the systematic design, collection, analysis, and reporting of data relevant to a specific marketing situation facing an organization o Gives insights into customer motivations, purchase behaviour, and satisfaction o Help them assess market potential and market share or measure the effectiveness of pricing, product, distribution, and promotion activities o Marketing research has 4 steps:  Defining the problem and research objectives – hardest step, three types of objectives:  Exploratory research: marketing research to gather preliminary information that will help define problems and suggest hypotheses  Descriptive research: marketing research to better describe marketing problems, situations, or markets, such as the market potential for a product or the demographics and attitudes of consumers  Causal research: marketing research to test hypotheses about cause-and-effect- relationships  Developing the research plan – determine the exact information needed, develop a plan for fathering it efficiently, an present the plan to management  Research plan o
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