Competitive intelligence and other aspects
In market research, databases contain information that is collected, aggregated, and used to define segments of homogeneous consumers. The key points for database in marketing are as follows:
- Researchers keep consumer databases up to date with as much available data as possible regarding consumer behavior and product consumption.
- When companies want to conduct consumer market research, they call on these research facilities to request consumers who fit a specific demographic and behavioral profile so that these prospective respondents can then be contacted to participate in research studies.
- Database research provides the raw data that has already been contributed by the purchaser when they complete brief surveys that ask for their contact and demographic information during or after a product purchase.
- Marketers can use database research to identify common buying patterns among consumers.
- Lists that can be found in existing databases include credit card holders, smokers, drinkers, car buyers, video buyers.
The Key Terms
- Market Research: The systematic collection and evaluation of data regarding customers’ preferences for actual and potential products and services.
- baby boomer: A person born in the postwar years (generally considered in the USA and other Allied countries as between 1945 and the early 1960s), when there was an increase in the birth rate following the return of servicemen at the end of World War II.
- database: An organized collection of data. The data are typically organized to model relevant aspects of reality (for example, the availability of rooms in hotels), in a way that supports processes requiring this information (for example, finding a hotel with vacancies).
A database is an organized collection of data that is typically organized to model relevant aspects of reality (for example, the availability of rooms in hotels) in a way that supports the processes that require this information (for example, finding a hotel with vacancies). In market research, a database contains information that is collected, aggregated, and used to define segments of homogeneous consumers.
Consumer Databases in Market Research
Researchers keep consumer databases up to date with as much available data as possible regarding consumer behaviour and product consumption. This customer information often includes, but is not limited to, a variety of data, including name and address, history of shopping and purchases, demographics, and brand and product consumption. When companies want to conduct consumer market research, they call on these research facilities to request consumers who fit a specific demographic and behavioural profile so that these prospective respondents can then be contacted to participate in research studies. Companies may also acquire prospect data directly using sweepstakes, contests, online registrations, and other lead generation activities.
Customers asked for information at counter: Retail outlets such as pharmacies can request customer’s contact information at check-out for specific products as a way to help build a consumer database
Database research is considered an extremely helpful tool in market segmentation research. For example, from zip code lists, marketers may determine where the wealthy consumers live in a city. That list can be merged with a list of moms of children 0-5 years old. The resulting list can be merged with another list of women who are Hispanic and African American to further target this niche demographic. The final list will deliver a potential market for a new baby product to be introduced and profiled in Hispanic and African American women’s magazines. The people on the potential buyers’ list could then be mailed an invitation to come test this new baby product.
Decision Support Systems
Decision support systems are tools that help companies assess and resolve business questions in a timely and effective manner.
Key Points
- Companies across all industries rely on decision support tools, techniques, and models to help them assess and resolve business questions.
- A DSS is a computer-based information system that helps businesses or organizations make better decisions by providing a flexible tool for analysis.
- In addition to helping management, DSS’s also serve the operations and planning levels of an organization by helping them make decisions.
- Decision support systems can be either fully computerized, human, or a combination of both.
- A key component to any DSS is business intelligence reporting tools, processes, and methodologies.
- The top benefits of decision support systems include speeding up the process of decision making, increasing organizational control, speeding up problem solving in an organization, helping automate managerial processes, improving personal efficiency, and eliminating value chain activities.
Key Terms
- Decision Support System: A computer-based information system that supports business or organizational decision-making activities.
Decision Support Systems
Companies across all industries rely on decision support tools, techniques, and models to help them assess and resolve business questions. One example of this is a decision support system (DSS). A DSS is a computer-based information system that helps businesses or organizations make better decisions by providing a flexible tool for analysis. With supporting software and hardware, this tool collects data that helps an organization gather and interpret relevant business information. It then converts the information into a basis for marketing action.
Example of a DSS: A decision support system helps a company resolve business questions
Decision support systems enable managers to obtain and manipulate information as they are making decisions. In addition to helping management, DSS’s also serve the operations and planning levels of an organization by helping them make decisions, which may be rapidly changing and not easily specified in advance. Decision support systems can be either fully computerized, human, or a combination of both.
A key component to any DSS is business intelligence reporting tools, processes, and methodologies. DSS’s also include knowledge-based systems and an interactive software-based system intended to help decision makers compile useful information from a combination of raw data, documents, personal knowledge, or business models.
Typical information that a decision support application might gather, and present includes:
- Comparative sales figures between one period and the next
- Projected revenue figures based on product sales assumptions
Decision support systems can be developed to support the types of decision-making faced by managers in specific industries such as the airline and real estate industry. For example, American Airlines produced a DSS that helps to decide how much to overbook and how to set prices for each seat so that a plane is filled, and profits are maximized. Decision support systems have become critical and useful across all types of business. In today’s global marketplace, it is imperative that companies respond quickly to market changes. Companies with comprehensive decision support systems have a significant competitive advantage.
The top benefits of decision support systems include:
- Speeding up the process of decision making
- Increasing organizational control
- Speeding up problem solving in an organization
- Helping automate managerial processes
- Improving personal efficiency
- Eliminating value chain activities
Competitive Intelligence
Competitive Intelligence (CI) is a hybrid process of marketing research and strategic analysis that can give companies a competitive advantage.
Key Points
- Competitive intelligence entails defining, gathering, analyzing, and distributing information about products, customers, and competitors.
- Competitive intelligence seek to make the organization more competitive relative to its entire environment and stakeholders: customers, competitors, distributors, technologies, and macro-economic data.
- There are many synonyms for competitive intelligence such as business intelligence, market intelligence, and corporate intelligence.
- At the core of this concept is the ability to understand the competition’s position and predict the likely moves that competing companies will employ based on basic business principles.
- Although the Internet is a first stop in information gathering, CI typically entails spending more time and effort gathering information by means of primary research, such as speaking with one’s own employees, customers, suppliers, or outside industry experts.
- Competitive intelligence can be executed via the following methods: primary research, secondary research, and analysis.
Key Terms
- Primary Research: The research that involves the collection of data that does not yet exist.
- primary data: information collected by the investigator conducting the research
- competitive intelligence: The action of defining, gathering, analyzing, and distributing intelligence about products, customers, competitors, and any aspect of the environment needed to support executives and managers in making strategic decisions for an organization.
- Secondary Research: This process involves the summary, collation, and synthesis of existing research rather than primary research, where data is collected from subjects or experiments.
Competitive Intelligence (CI) in marketing research involves defining, gathering, analysing, and distributing information about products, customers, and competitors and any aspect of the environment needed to support executives and managers in making strategic decisions for an organization. Although the term CI is also considered synonymous with competitor analysis, competitive intelligence extends beyond analysing competitors. CI seeks to make the organization more competitive relative to its entire environment and stakeholders: customers, competitors, distributors, technologies, and macro-economic data.
There are many synonyms for competitive intelligence such as business intelligence, market intelligence, and corporate intelligence.
The CI field has been growing exponentially as it is becoming a must-have core competency for many businesses. At the core of this concept is the ability to understand the competition’s position and predict the likely moves that competing companies will employ based on basic business principles.
Internet: The Internet is one method that is used to gather information for competitive analysis
Although the Internet is a first stop in information gathering, CI typically entails spending more time and effort gathering information by means of primary research, such as speaking with one’s own employees, customers, suppliers, or outside industry experts. CI can typically be executed via the following methods:
- Primary research – This process involves the use of a human network to access meaningful intelligence.
- Secondary research – This process involves the use of secondary research sources, such as by gathering published information.
- Analysis – This process involves the use of analytical tools.
In essence, CI is a hybrid process of marketing research and strategic analysis that ultimately seeks to provide companies and their products with a competitive advantage in the marketplace.