Components of MIS

MIS is made of parts, subparts or subsystems which are called

the components.
Typically, according to Philip Kotler, a marketing information
system consists of four interrelated components – Internal
Reports (Records) System, Marketing Research System,
Marketing Intelligence System, and Marketing Decision
Support System, as shown in Figure
Components of Marketing Information System
 1. Internal Records System:

 Internal records system is a major and easily accessible source of

information. It supplies the results data. It consists of all records of
marketing operations available within organisation. This system concerns
with collecting, analyzing, interpreting, and distributing needed information
from records of various departments of the company.

 Main sources include various records on sales and purchase, ordering

system, sales force reporting system, inventory level, receivable-payables,
marketing staff, costs, the past research works, and other
literatures/reports available within organisation. Particularly, for sales
orders and sales force reporting, the computer technology is excessively
used for accurate, efficient, and speedy transmission of information.
 2. Marketing Intelligence System:

Marketing intelligence system is:The set of procedures and sources used by

managers to obtain every-day information regularly about pertinent
developments in the marketing environment. A manager can try to expose
external environment in various ways.
Marketing intelligence system consists of various methods.
A manager can use one or more below mentioned methods:
i. Reading newspapers, books, and other publications.
ii. Watching TV, hearing radio, or Internet surfing.
iii. Talking to customers, dealers, suppliers, and other relevant parties.
iv. Talking to other managers and employees of his company as well as of
other companies.
v. Maintaining live contacts with other officials and agencies.
vi. Purchasing useful information from professional sources.
vii. Assigning marketing intelligence task to professional agencies, etc.
 3. Marketing Research System

 Marketing research is a powerful and independent branch of the MIS. In

certain cases, managers need detailed information on the specific problem
of the specific marketing area. Thus, it is a formal study of specific
problems, opportunities, or situations. Normally, it is carried out for
solving the specific problem.

 In this sense, it is not a part of routine activity. It collects need-based

information. Nowadays, it is treated as the separate discipline or subject.
Philip Kotler defines: “Marketing Research is the systematic design for
collection, analysis, and reporting of data and findings relevant to specific
marketing situations facing the company.”

 Marketing research consists of collecting primary and secondary data from

various respondents using various tools through various methods for
definite period of time, analyzing data using appropriate statistics tools,
and presenting findings in forms of a report. It is conducted by internal
expert staff or external professionals.
 4. Marketing Decision Support
System (MDSS):
 Previously, the component was known as Analytical Marketing System. While
former three components supply data, the marketing decision support system
concerns more with processing or analyzing available data. This component can
improve efficiency and utility of the whole marketing information system.

 The system is used to help managers make better decisions. John D. C. Little
defines: “A marketing decision support system (MDSS) is coordinated collection of
data, systems, tools, and techniques with supporting software and hardware by
which an organisation gathers and interprets relevant information from environment
and turns it into a basis for making decisions.”

 According to the definition, the MDSS includes tools, techniques or

models used for:
 Data collection,
 Data analysis,
 Interpreting results, and
 Supporting managerial decision-making.
 Advantages of Marketing Information
Systems
 Organized Data collection –Lots of data can be collected from the market.
But the main word here is “Organized”. Organizing data is very important
else the data is meaningless. Thus MIS helps you to organize your database
thereby improving productivity.
 A broad perspective – With a proper MIS in place, the complete
organization can be tracked which can be used to analyse independent
processes. This helps in establishing a broader perspective which helps us
know which steps can be taken to facilitate improvement.
 Storage of Important Data –Several times in pharmaceuticals, when one
drug is being produced they may need data of another drug which was
produced years back. Similarly in Media, photographs are stored in
archives. This storage of important data plays a crucial role in execution
and thus proves again that MIS is not important only for information but
also for execution.
 Avoidance of Crisis – The best way to analyse a stock (share market) is to
see its past performance. Top websites like moneycontrol thrive on MIS.
Similarly MIS helps you keep tracks of margins and profits. With an
amazing information system established, you can know where your
organization is moving and probably avert a crisis long before it has taken
place. Ignoring hints received from MIS reports is foolhardy.
 Co-ordination – Consumer durables and FMCG companies have huge
number of processes which needs to be co-ordinated. These companies
depend completely on MIS for the proper running of the organization.
There are dedicated people for marketing information systems in such
organizations. This is mainly because of the speed required to access
information and implement it.
 Analysis and Planning – MIS is critical for planning. You cannot do
planning without information. For planning, the first thing which is needed
is the organizations capabilities, then the business environment and finally
competitor analysis. In a proper MIS, all these are present by default and
are continuously updated. Thus MIS is very important for planning and
analysis.
The Marketing Research
process
 Marketing research is the systematic
design, collection, analysis, and reporting
of data and findings relevant to a specific
marketing situation facing the company.
Define the problem

Develop research plan

Collect information

Analyze information

Make
Present findings decision
 Define the problem

 Define the problem (e.g., Will offering an in- flight

Internet service create enough incremental preference and
profit of American Airlines to justify its cost?)
 Specify decision alternatives (e.g., Should
American offer an Internet connection?)
 State research objectives (e.g., types of 1st class
passengers are likely to use internet?)
 Develop research plan

Data Research
Sources Approach

Research Sampling
Instruments Plan

Contact
Methods
 Observation--unobtrusive
 Ethnographic--link between culture & behavior &/or
how cultural processes develop over time (participant
observation)
 Focus group—discuss topics of interest
 Survey—
knowledge, beliefs, preferences, satisfaction
 Behavioral data--Data—purchasing data
 Experimentation—cause and effect
relationships
4-28
 Questionnaires
 Qualitative Measures
 Technological Devices
 Ensure questions are  Avoid negatives
free of bias  Avoid hypotheticals
 Make questions simple  Avoid words that could be
 Make questions misheard
specific  Use response bands
 Avoid jargon  Use mutually exclusive
 Avoid sophisticated categories
words  Allow for “other” in
 Avoid ambiguous fixed response
words questions
 Word association—words are presented, one at a time, and
respondents mention the first word that comes to mind.
 Projective techniques—give people an incomplete
stimulus and ask them to complete it.
 Visualization—requires people to create a collage from
magazine or drawing to depict their perceptions
 Brand personification—ask subjects what kind of person
they think of when the brand is mentioned.
 Laddering—series of increasingly more specific “why”
questions can reveal consumer motivation and consumers’
deeper, more abstract goals.
 Shadowing—observing people

Behavior mapping—photographing people with a

space—2 or 3 days

Consumer journey—keeping track of interactions a

consumer has with a product, service, or space

Camera journals—ask consumers to keep visual diaries of

activities and impression related to a product

Extreme user interviews—talking to people about a

product and evaluating their experience with it

Storytelling—prompting people to tell personal

stories about their consumer experiences

Unfocused groups—interview a diverse group of

people to explore ideas
 Galvanometers (measure interest or
emotions aroused by
Exposure to a specific ad or picture)

Tachistoscope (flashes an ad to a Subject

with an exposure interval and
respondent describes everything he/she recalls)

Eye cameras (study respondents’

eye movement to see where their eyes land 1st and how
long, etc.)

Audiometers (record when TV is on and the

channel)

GPS (global positioning system, can Determine how

many billboards a person may walk or drive by during a
day)
 Sampling unit: Who is to be surveyed?

 Sample size: How many people should be surveyed?

 Sampling procedure: How should the respondents be

chosen?
 Probability Non-probability
 Simple random  Convenience
 Every member of
population has an equal  Selects the most accessible
chance of selection population
 Systematic Sampling Members
 Judgment
 Stratified random
 Population is divided into Selects population members
mutually exclusive groups who are good prospects for
(age groups) and random accurate information
samples are drawn from each
group  Quota
 Cluster Selects and interviews a
 Population is divided into prescribed number of people
mutually exclusive groups in each of several
(city blocks) and a sample is categories
taken from each group
 Snowball
 Mail Questionnaire
(For people would not give personal
interviews or whose responses
might be biased or distorted by
interviewer)

Telephone Interview
(Gather information quickly, however
interview are short and non-personal)

Personal Interview
(Most versatile and expensive, subject to
interview bias or distortion)

Online Interview
(Inexpensive, faster, honest, versatile, samples small and
Advantages Disadvantages
 Inexpensive  Small samples
 Fast  Skewed samples
 Accuracy of  Technological
data, even for problems
sensitive  Inconsistencies
questions
 Versatility
A marketing decision support system is a coordinated
collection of data, systems, tools, and techniques with
supporting hardware and software by which an
organization gathers and interprets relevant information
from business and environment and turns it into a basis
for marketing action.
 A narrow conception of the research
 Uneven caliber of researchers
 Poor framing of the problem
 Late and occasionally erroneous findings
 Personality and presentational
differences
Thank
you