1. Overview of Marketing Intelligence

Introduction

Imagine that you are intending to start up a hospitality service firm and you really want to understand how the business runs in your immediate environment. Because you are interested in breaking through entry barriers and surviving in the industry in the long run, you would begin to look for information around you concerning what other hospitality firms are doing. Your aim could be to get some ideas about the kind of services they offer so that you do not offer less, but rather present optimum benefits to customers. This is exactly what is referred to as marketing intelligence.

Expected Learning Outcomes of Unit 1

 At the end of this unit, it is expected that you will be able to:

  1. Define and use correctly keywords in bold. (SAQ 1.1).
    1. Identify the components of marketing intelligence. (SAQ 1.2).
    1. Ascertain the essence of customer relationship marketing/database marketing. (SAQ 1.3).

Marketing intelligence refers to the everyday information relevant to a company’s markets, which are gathered and analyzed specifically for the purpose of accurate and confident decision-making in determining market opportunity, market penetration strategy, and market development metrics. It is basically made up of Database marketing and marketing research.

Figure 1.1. Having Competitive Intelligence through Marketing intelligence

 In a more concise manner, Marketing intelligence is the process of acquiring and analyzing data and information in order to understand the market to determine the future needs and preferences, attitude and behaviour of the market, and to assess changes in the business environment that may affect the size and nature of the market in the future. The primary aim of marketing intelligence is to build lasting and enduring relationship between a business and its customers. It makes use of tools and techniques which include information and communication technologies to carry out research, and to select and enter a market place.

Today’s firms now play in a global environment which cuts across various geographical boundaries. Globalization brought about by technological advancement, has led to the emergence of a borderless economic environment where firm’s competitors and market place are no longer limited by geographical boundaries, but are widely spread across the globe. In other words, firm’s competitors are no longer those from the domestic environment alone, but also include similar firms in other parts of the globe. As a result, most firms are buying into the use of information and communication technologies in managing their customers.

  • In-text Question
  • As an ace marketer who has handled diverse situations in the marketing sphere, explain to newbies why it essential to understand the market through marketing intelligence.
    • It is essential in order to understand the market to determine the future needs and preferences, attitude and behaviour of the market, and to assess changes. You can find more details on this in section 1.1.

The table below describes the various purposes of marketing intelligence.

Purpose of Marketing Intelligence
PurposeType of study that meets this purpose
Help enter new market, or expand presence in a marketMarket entry and market expansion studies
Minimize the risk of an investment decision being wrongMarket assessment or acquisition studies
Keep ahead of the competition, obtain first-mover advantage over competitorsCompetitor intelligence study
Give the customers what they want, expand market shareNeeds assessment studies
Establish and maintain a distinctive corporate identityCorporate positioning studies
Tailor products and marketing effort around customer needsSegmentation studies

Source:            www.b2ninternational.com

  

From the above, you can delineate two major components of marketing intelligence, namely:

  1. Marketing Research, and
  2. Customer Relationship Marketing.

EXAMPLE

Take for instance the scenario described at the introduction of this unit. The major purpose for establishing hospitality firms generally is to serve guests profitable by meeting their needs in a pleasant manner. As a new entrant into the industry, it becomes important to find out what other hotels or restaurants are doing in terms of: the quality of recreational services, entertainment, food, comfort, memories etc. This would certainly lead you to asking yourself how you can gather such vital information in an accurate, reliable and timely manner. You may now begin to think up various options such as engaging in some forms of discussion with individuals, customers in an informal way; or/and conducting more organized studies to elicit whichever information you consider important.

The idea is that marketing intelligence helps you to gather information on the market and consumers through customer relationship / database marketing and marketing research. Even existing organization have to constantly embark on efficient and effective marketing intelligence in order to maintain their competitive position in the industry (Igbaekemen, 2014). Let us briefly discuss the first aspect which is the concept of Customer Relationship Marketing/Database Marketing, while the remaining part of this courseware focuses on the second aspect which is Marketing Research.

Box 1.1. The Aim of Marketing Intelligence

The primary aim of marketing intelligence is to build lasting and enduring relationship between a business and its customers. It makes use of tools and techniques which include information and communication technologies to carry out research, and to select and enter a market place.

Customer relationship marketing or Database marketing refers to the collection, analysis, and interpretation of customer data in order to drive more relevant customer experiences. It involves the collection of data from a range of sources including customer email correspondence, data warehouses and external sources like social media.

Fig 1.2. Database Marketing/Customer Relationship Marketing  

Customer relationship marketing integrates information on customer buying behaviour, buying pattern and motivation through firm’s data base and market research. It is a type of marketing information system which help the firm to efficiently manage the product and service that is offered to the customers. By customers we mean the existing and potential customers. The major purpose of database marketing is to satisfy and retain the old customers by attaining mutual benefits and acquire new ones. The understanding here is that firms cannot truly exist without customers.

Activity 1.1.                                                                           

As a guest at the Annual General Meeting of marketers in Nigeria. You are required to speak on the components of marketing intelligence. You have less than 5 minutes to the presentation. Pick out a piece of paper and write out the various components of marketing so as to remind yourself while speaking

Activity Feedback

Recall that in section 1.1. I told you that you can delineate two major components of marketing intelligence, namely:

  1. Marketing Research, and
  2. Customer Relationship Marketing.

For further readings on overview of marketing intelligence visit the link below:

http://dstevenwhite.com/2010/07/06/marketing-metrics-intelligence-and-research-a-basic-overview/

However, before embarking on the research process in order to solve any marketing problem, understanding the dynamics of the problem is vital. Scott and Gerald (2012) provides a simple hint on understanding any marketing problem thus:

Problem formulation is simplified once we define the components of the research problem.

1. Specify the Research Objectives

A clear statement of objectives will help you develop effective research. It will help the decision makers evaluate your project. It’s critical that you have manageable objectives. (Two or three clear goals will help to keep your research project focused and relevant.)

2. Review the Environment or Context of the Problem

As a marketing researcher, you must work closely with your team. This will help you determine whether the findings of your project will produce enough information to be worth the cost. In order to do this, you have to identify the environmental variables that will affect the research project. These variables will be discussed in-depth in later chapters.

3. Explore the Nature of the Problem

Research problems range from simple to complex, depending on the number of variables and the nature of their relationship. If you understand the nature of the problem as a researcher, you will be able to better develop a solution for the problem. To help you understand all dimensions, you might want to consider focus groups of consumers, sales people, managers, or professionals to provide what is sometimes much needed insight.

4. Define the Variable Relationships

Marketing plans often focus on creating a sequence of behaviors that occur over time, as in the adoption of a new package design, or the introduction of a new product. Such programs create a commitment to follow some behavioral pattern in the future. Studying such a process involves:

• Determining which variables affect the solution to the problem.

• Determining the degree to which each variable can be controlled.

• Determining the functional relationships between the variables and which variables are critical to the solution of the problem.8 | Marketing Research

During the problem formulation stage, you will want to generate and consider as many courses of action and variable relationships as possible.

5. The Consequences of Alternative Courses of Action

There are always consequences to any course of action. Anticipating and communicating the possible outcomes of various courses of action is a primary responsibility in the research process. Exhibit 1.3 provides an example of a company introducing a new product based on research that did not examine relevant variables in the consumer purchase decision.

1.3 Unit Summary

From this unit, you have learnt that;

  1. Marketing intelligence covers acquisition of information relevant to a company’s markets.
  2. These information are gathered and analysed specifically for the purpose of making accurate and confident decision-making in determining market opportunity, market penetration strategy, and market development metrics.
  3. The two major aspects of marketing intelligence are customer relationship marketing also known as database marketing and marketing research.
  4. Database marketing involves collection, analysis, and interpretation of customer data sourced from customer email correspondence, data warehouses, and, increasingly, external sources like social media in order to drive more relevant customer experiences.

1.4 Self-Assessment Questions

Congratulations on your successful completion of this unit. To ascertain your level of grasp of the subject matter, please, attempt the self-assessment questions below:

SAQ 1.1.         (Measuring Learning Outcome 1.1.)

Fill in the right answer to each of the following question with the options provided.

SAQ 1.2.         (Measuring Learning Outcome 1.2.)

What is the essence of marketing research?

SAQ 1.3.         (Measuring Learning Outcome 1.3.)

How do you carry out database marketing?

Notes to Self Assessment Question for Unit 1

SAQ 1.1.         (Measuring Learning Outcome 1.1.)

  1. Customer Relationship Marketing is another name for Database Marketing.
  2. Marketing Intelligence is used to assess changes in the business environment that may affect the size and nature of the market in the future.

SAQ 1.2.         (Measuring Learning Outcome 1.2.)

The primary aim of marketing intelligence is to build lasting and enduring relationship between a business and its customers. It makes use of tools and techniques which include information and communication technologies to carry out research, and to select and enter a market place.

SAQ 1.3.         (Measuring Learning Outcome 1.3.)

Database marketing involves collection, analysis, and interpretation of customer data sourced from customer email correspondence, data warehouses, and, increasingly, external sources like social media in order to drive more relevant customer experiences.