International Business and International Marketing

Chapter 7 : Marketing Information Systems and Research

Chapter Summary

Information is a critical element in the success or failure of an organization. Every organization needs a marketing information system for the collection, processing, storage, and distribution of data. A marketing information system provides information on every aspect of marketing and helps an organization come up with effective strategies. Utmost care should be taken while developing a marketing information system.

The marketing information system of an organization collects the required information in two stages. In the first stage, a list of subjects for which information is required is framed. In the second stage, data is searched for the specified requirements. This is known as ‘scanning.’ Scanning is done in two ways: Surveillance and search modes. Marketing information research provides data related to markets, customers, products, price, distribution, and promotion.

The research related to markets is known as market research. Market research deals with market potential, market entry or exit decisions, market segmentation, market performance, market shares, sales analysis, and forecasting. Information requirements of firms vary. Firms that are entering into international markets for the first time need different kinds of information from the ones that are already in the market. Therefore, the information requirements of organizations differ.

A marketing information system needs to collect data for different purposes and needs to provide information at different levels. Therefore, it should understand the type of decisions made at a particular level and the kind of analysis made at that level to provide the information in the required form. After determining the information a number of appropriate units of analysis should be determined. Units refer to the characteristics of an individual or object that has to be measured.

The units of market research may be divided into three categories such as, region or country grouping – grouping of the countries based on certain common factors; Country – studying the various socioeconomic, cultural, political aspects of the country; Sub-groups within the countries – the various sub-groups within the country should be studied in order to understand the diversions in the markets within the countries. After studying the unit of analysis, a researcher should identify the information sources.

The information sources can be broadly divided into primary and secondary sources. The primary source may be explained as field research. This is very costly and time consuming. Here, data is collected for the first time. Primary data is collected through interviews and questionnaires. To obtain primary data, the researcher has to decide upon the sample – a part of population or a subset from a set of units, and decide upon the tool – questionnaires, interviews and surveys etc. Questionnaires and surveys are the most popular tools available. Secondary data is the data that is already collected and published. These are relatively cheap and easily available. Secondary data is obtained from various sources like government reports, international organizations, and private market research firms.

One more way of classifying data is internal or external. Internal data is the data within the organization and external data is the data obtained from external parties. An international researcher should decide on the source first. A company has to collect economic, industrial, political, financial, legal, marketing, and specific product data before entering into a country. The problems of international market research are multifold. The data obtained from each country will be different. Obtaining reliable secondary data is extremely difficult, especially in less developed economies. Similarly, obtaining primary data is also difficult as the researcher may face problems related to infrastructure, time, and non-response.

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