MARKETING MANAGEMENT 12 th edition 3 Gathering Information and Scanning the Environment KotlerKeller

3-2 Objectives  What are the components of a modern marketing information system?  What constitutes marketing intelligence and research?  What are the key methods for tracking and identifying opportunities in the macroenvironment?  What are the key demographic, economic, natural, technological, political, and cultural developments?

3-3 Marketing Information System and Internal Records Order-to-Payment Cycle Databases, Warehousing, Data Mining Marketing Intelligence System Sales Information System Research Projects

3-4 Marketing Intelligence System and Research A MARKETING INTELLIGENCE SYSTEM is a set of procedures and sources used by managers to obtain everyday information about developments in the marketing environment. INFORMATION (PRIMARY & SECONDARY) SOURCES AND ACTIVITIES: –In-House Sales Force trained recognize and required to provide critical market data –Distributors, retailers & other intermediaries supporting strategic relationships provide data –Specialists for hire: mystery shoppers provide ongoing feedback on customers & competitors –Competitor product information, trade shows, reports, stockholders meetings, internet, dealers, distributors, suppliers, freight agents, even employees. –Customer Advisory Panels established to identify evolving customer and market needs –Outside suppliers sell secondary data– syndicated & subscription service firms (i.e. Nielsen, Information Resources, SAMI/Burke, MRCA, Simmons Market Research Bureau, Arbitron., others in Table 3.2) –Major publications, abstracts and relevant news disseminated by the intelligence staff MARKETING RESEARCH is the systematic design, collection, analysis and reporting of data and findings relevant to a specific marketing situation facing the company. INFORMATION (PRIMARY & SECONDARY) SOURCES (Internal & External) –Internal and External Sources Same as above, plus –Research projects contracted at low cost with students, professors and universities, or –Costlier projects through outside marketing research firms- three kinds: 1) Syndicated Service Research 2) Custom Marketing Research 3) Specialty-Line Marketing Research

3-5 Steps to Improve Marketing Intelligence Train sales force to scan for new developments Motivate channel members to share intelligence Network externally Utilize a customer advisory panel Utilize government data resources Purchase information Collect customer feedback online

3-6 Analyzing Needs and Trends in the Macroenvironment: Market Opportunities Vary in Accordance with Trends A Trend is: A direction or sequence of events that has some momentum and durability. A Megatrend is: A large environmental, social, or cultural change that is slow in coming but once in place has a prolonged duration in excess of ten years. A Fad is: A short term change in events that is unpredictable and usually without significant social, economic or political significance. Demographic Economic Socio-Cultural Natural Technological Political-Legal TRENDS MEAN CHANGE MEGATRENDS SHAPING THE CONSUMER LANDSCAPE ENVIRONMENTAL FORCES Aging boomers Delayed retirement Changing nature of work Greater educational attainment Labor shortages Increased immigration Rising Hispanic influence Shifting birth trends Widening geographic differences Changing age structure

3-7 Environmental Forces Demographic Economic Socio-Cultural Natural Technological Political-Legal Population Size Growth rate Age distribution: Preschool, School, Teens, 25-40, 40-65, 65+ Educational Levels Ethnic Mix Household patterns Regional characteristics Movement Purchasing Power Income Distribution Savings Rate Debt Credit Availability CONSUMER Industrial Economies Industrializing Economies Raw Material-Export Economies Subsistence Economies INDUSTRY STRUCTURES Views of Themselves Views of Others Views of Organizations Views of Society Views of Nature Views of the Universe Shortage of Raw Materials Increased Energy Costs Anti-pollution Pressures Governmental Protections Pace of Change Opportunities to Innovate Varying R&D Budgets More Regulation of Change Increase in Business Legislation Growth of Special Interest Groups The Environment is Constantly Changing but Human Needs Never Change

3-8 Analyzing Needs and Trends in the Macroenvironment SIGNIFICANCE & MARKETING CONSIDERATIONS OF TRENDS  Trends = Change = Opportunity and Risk  Heavy risk is associated with investments in fads versus trends  Varying degrees of investment are required to react – a function of opportunity size and resources required  Assess prospects of fads versus trends  Strategies should focus on profitable trend participation and exits from fad flexibility  OEMing solution components in early stages of a trend tends to optimize opportunity and Minimize risk