CRAVENS

PIERCY

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McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved.
 5-2

Chapter Five

Continuous
Learning About
Markets

McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved.

 5-3

Continuous Learning
About Markets

Market orientation and

organizational learning
Marketing research information
Information systems
Marketing intelligence systems
and knowledge management
Ethical issues in collecting and
using information
 5-4

Market Orientation
and Organizational
Learning

Market orientation
perspective includes all
relevant sources of
knowledge and ideas
Characteristics of the
learning organization
Learning and competitive
advantage
 5-5

Learning About Markets

Open-
Minded
Inquiry

Keeping and Synergistic

Gaining Access Information
to Prior Distribution
Learning

Mutually
Informed
Interpretations

Source: George S. Day, Journal of Marketing, October 1994.

 5-6
Illustrative Example: The
Bombay Company

 Turnaround strategy at The Bombay

Company started with customer research
examining shopping experiences and what
consumers really wanted from a home
furnishings supplier
 This drove major changes in how goods
were displayed and presented to
overcome perceptions of confused
merchandizing and pricing
 Stores were re-merchandized around
themes to overcome consumer feelings
that the company was too “stuffy”
 The research showed that catalogs were
used for decorating ideas not product
listings, so they were restyled around
lifestyle choices
 The Bombay Company strategy is driven
by extensive market research and
rewsponse to customer feedback
 5-7

A Framework for
Market Sensing

Probability of the Event Occurring

High Medium Low
7
Field of
Utopia
6 Dreams

5
Effect of the
Event on the Things to
4 Watch
Company*
3
Future
2 Danger
Risks
1

* 1=Disaster, 2=Very bad, 3=Bad, 4=Neutral, 5=Good, 6=Very good, 7=Ideal

 5-8

Types of Marketing
Information

Marketing research studies

Standardized information
services
Management information
systems
Database systems
Decision support systems
Customer relationship
management (CRM) systems
Competitor intelligence systems
 5-9

Strategies for Obtaining Information

Internal Data
Collect existing
information
Published
information

Subscription
Strategy Use standardized
alternatives research services
Single purchase

Exploratory
Conduct
research study
Full-scale
 Advantages and Limitations 5-10
of Questioning Methods
Advantages Limitations
Personal Interviews
Most versatile and High cost
flexible Possibility of interviewer
Long questionnaires bias
handled more easily Possibility of cheating by
Presence of interviewer interviewer due to lack
allows more flexibility of supervision
in procedure Project time often lengthy
More enjoyable for
respondents
Fewer refusals

Telephone Interviews
Fewer interviewers needed More noncommittal
Relatively inexpensive answers
Rapid method of data Some households
collection overrepresented
Can reach large number of Lengthy and detailed
households questions often not
More control over interviewers feasible

Mail surveys
Higher-quality information Questionnaire cannot be
Better for collecting changed
information on possibly Complex
embarrassing subjects Can be completed by
Relatively cheaper to conduct person other than intended
No interviewer bias Follow-up expensive
Response often slow in
coming

Source: Harper W. Boyd, Jr., Ralph Westfall, and Stanley F. Stasch, Marketing Research:
Text and Cases, 5th ed. (Homewood, IL Richard D. Irwin, 1981), Chap. 4.
 5-11

Special Research Studies

Problem
Definition

Information
Required

Research
Method

Sampling
Plan

Questionnaire
Design

Data
Collection

Analysis and
Report
 5-12

Screening A New
Research Supplier

1. Client → Would you recommend

this supplier?
2. Supplier → Do you have
sufficient funds for this project?
3. What parts of the project will be
subcontracted, and how do you
manage subcontractors?
4. May I see your interviewer’s
manual and data entry manual?
5. How do you train and supervise
interviewers?
 5-13

6. What percentage of interviews are

validated?
7. May I see a typical questionnaire?
8. Who draws your samples?
9. What percentage of your data entry
is verified?
10. Managers → What do you think
about this supplier?

Source: Seymour Sudman and Edward Blair,

Marketing Research, A Problem-Solving Approach, Irwin/McGraw-Hill, 1998, 67.
 5-14

Impact of the Internet on

Marketing Costs and
Availability

 Online Surveys
– Fast
– Inexpensive
– Limitations in population coverage
– Resistance to excessive Web communications
 Customer feedback and peer-to-peer Web
communications
 Monitoring customer Web behavior
 5-15

Illustrative Example:
Knowledge Sharing at
Buckman Labs
 Buckman has more than 50 Internet
discussion groups focused on its main
products – employees post 50-100
messages a day
 The company has amassed an easily
searchable database of in-house expertise
and past lessons learned, all accessible to
employees and customers
 The Web harnesses the brainpower of an
entire global speciality chemicals company
around customer problems
 Knowledge sharing is the foundation for
superior learning about customers
 5-16

Marketing Decision-Support
System Components

Database Display

Analysis
Capabilities Models
Marketing Intelligence and
5-17

Knowledge Management
Market sensing does not rely on
hard data alone
– intelligence from publications, sales
calls, customer visits, social contacts,
Internet, rumor
Knowledge management
Role of the Chief Knowledge
Officer
Leveraging customer
knowledge
– creating “customer knowledge
development dialogues”
– operating enterprise-wide “customer
knowledge communities”
– capturing customer knowledge at the
point of customer contact
– management commitment to
customer knowledge
 5-18

Ethical Issues in
Collecting
and Using Information

Invasion of customer privacy

– e.g., use of medical databases to
sell healthcare products
Information and ethics
– e.g., guidelines for sharing of
confidential information
– e.g., collecting data from children