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DataDrivesStrategy
TheadventoftheInternethasbroughtaboutanewphenomenon–informationoverload.E-marketersaresaddleswiththeburdenofsortingthroughtheenormousamountsofdataavailableandtoanalyzetheusefulinformation.
MarketingKnowledgeManagement
Knowledgemanagementistheprocessofmanagingthecreation,useanddisseminationofknowledge.Marketingknowledgeisthedigitized“groupmind”or“collectivememory”ofthemarketingpersonnelandsometimesofconsultants,partner,andformeremployeesaswell.
TheElectronicMarketingInformationSystem
Amarketinginformationsystem(MIS)istheprocessbywhichmarketersmanageknowledge.Itassessesinformationneeds,gatheringinformation,analyzingit,anddisseminatingittomarketingdecisionmakers.Manyfirmsstoreelectronicmarketingdataindatawarehousesoraproductdatabase.
Source1:
InternalRecords
Internalrecordscompriseoneimportantsourceofmarketingknowledgeandcanincludedatafromaccounting,finance,andproduction.
SalesData–Salesinformationsystems(salesforceautomationsoftware)allowemployeestoinputsalescallstoprospectsandcurrentcustomers.Competitiveandindustryinformationcanalsoberecordedaswellascustomercomplaintsorcompliments.
CustomerCharacteristicsandBehavior–Customeractivityisperhapsthemostimportantinternalmarketingdataonecancollect.E-marketerscanrecordanythingfromthestickinessofparticularwebpagestogeographicdistribution.Analyzingcustomerpatternshelpgreatlywithmarketingandadvertisingcampaigns.
Source2:
SecondaryData
Secondarydatacanbecollectedmorequicklyandlessexpensivelythanprimarydata.TheInternetoffersup-to-dateinformationfromover200countriesandisavailable24/7.However,secondarydatawasgatheredforadifferentpurpose,soitmaynotmeettheneedsofthee-marketers.OneoftheInternet’sbenefitsistheaccessibilityofenvironmentalfactorsandtrends.
PubliclyGeneratedData–MostUSandforeignagenciesprovideonlineinformationintheirrespectiveareas.USgovernmentalagencies,universities,librariesandothernot-for-profitorganizationsmakeresearchavailableonline.
PrivatelyGeneratedData–Onlineresearchfirmsmaketheirresultsanddataavailable,butinformationcanalsobecollectedfromacompany’sWebsite.Severaldifferentservicesthatgenerateresearchdatawillbediscussedintheoutlineandchapter.
CompetitiveIntelligenceExample–CIinvolvesanalyzingtheindustriesinwhichafirmoperatesasinputtothefirm’sstrategicpositioningandtounderstandcompetitorvulnerabilities.CIcanhelpfirm’sanalyzecompetitionaswellasassistinstrategicplanning
InformationQuality–Secondaryandprimarydataaresubjecttomanylimitations.E-marketersshouldbewaryofdata,especiallyifitissecondarydata.E-marketersshould:
discovertheWebsite’sauthor,trytodetermineifthesiteauthorisanauthorityonthetopic,checktoseewhenthesitewaslastupdated,determinehowcomprehensivethesiteis,validatetheresearchbyfindingsimilarinformation,andcheckthesitecontentforaccuracy.
Source3:
PrimaryData
Primarydataareinformationgatheredforthefirsttimetosolveaparticularproblem.Thisisusuallymoreexpensiveandtime-consuming,butismorecurrentandrelevanttothemarketer’sspecificproblem.
PrimaryResearchSteps–Consistsoffivesteps:
(1)researchproblem,
(2)researchplan,(3)datacollection,(4)dataanalysis,and(5)distributefindings/addtodatabase.
InternetBasedResearchApproaches–Conventionalresearchmethodshavefaceddecreasedresponsesoverthepastfewyears.Amajorityofresearchcompaniesusonlinesurveys,mostnotably:
Thecreativetest,customersatisfaction,andproductdevelopmentsurveys.Inaddition,dataarecollectedonlineusingexperiments,focusgroups,observations,in-depthinterviews,andsurveyresearch.
EthicsofOnlineResearch–Onlineresearchcompanieshavedevelopeda“giftculture”byofferingnominalfeesforparticipation.Marketersuseunsolicitedemails,harvestemailaddressesfromnewsgroups,andconductsurveysforthepurposeofbuildingadatabaseforlatersolicitation.Privacyofuserdatahasbecomeasignificantissue.
MonitoringtheSocialMedia
Blogsandotheronlinemediumsarebecomingoutletsofinformationsharingnotseeninthehistoryofbusiness.CitizenjournalistsareusingtheInternettoissueemailalerts,customercomplaintsandproduct/servicereviewsthatallowrealtimeconversationandinformationexchange.
OtherTechnology-EnabledApproaches
TheInternetisanexcellentplacetoobserveuserbehaviorbecausethetechnologyautomaticallyrecordsactionsinaformatthatcanbeeasily,quickly,andautomaticallymanipulatedforanalysis.
Client-SideDataCollection
Thisreferstocollectinginformationaboutconsumersurfingrightattheuser’sPC.Thiscanbedonewithcookiesbytrackingusersurfingandhelpsmarketerspresentappropriatepromotions.TheinstallationofaPCmetercanhelpmarketerstrackuserclickstreams,similartotheNielsenmeterusedfortelevisionshows.
Server-SideDataCollection
SoftwareonaWebsitecanrecordhowmanyusersvieweachpage,thelocationofthesitevisitedpriortothefirm’ssite,howlongtheuserisoneachpage,andwhattheusersbuy.Thisallowse-marketerstousereal-timeprofilingthatcompilesandreportsondataatamoment’snotice.E-marketersmaythenmakeinstantaneousadjustmentstositepromotionsandWebpages.
Real-SpaceApproaches
Real-spaceprimarydatacollectionoccursatofflinepointsofpurchase.Thiscanbedonewithsmartcardandsmartcardreaders,interactivepointofsalemachines,andbarcodescanners.UPCcodes,orbarcodes,havebeenusedforthispurposesince1974.MarketersalsouseUPCinformationingrocerystorestogeneratecouponsbasedoncustomer’spurchases.
MarketingDatabasesandDataWarehouses
Uponcollection,dataaremovedtovariousmarketingdatabases.Thesedatabasesholdinformationaboutproductfeatures,prices,inventorylevels,customercharacteristics,andbehaviors.Thesewarehousesarealsousedforanorganization’sentirehistoricaldataset.Becauseofthecurrentstateofinformationoverload,contentmanagementhasbecomeincreasinglyimportanttothesuccessofaWebsite.
DataAnalysisandDistribution
Fourimportanttypesofanalysisformarketingdecisionmakingincludedatamining,customerprofiling,RFManalysis(recency,frequency,monetary),andreportgenerating.Datamininginvolvestheextractionofhiddenpredictiveinformationinlargedatabasesthroughstatisticalanalysis.Customerprofilingallowsfor:
selectingtargetgroupsforpromotionalappeals,findingandkeepingcustomerswithahigherlifetimevaluetothefirm,understandingtheimportantcharacteristicsofheavyproductusers,directingcross-sellingactivitiestoappropriatecustomers,andreducingdirect-mailingcostsbytargetinghigh-responsecustomers.
KnowledgeManagementMetrics
Marketersweighthecostofgainingadditionalinformationagainstthevalueofpotentialopportunitiesortheriskofpossibleerrorsfromdecisionsmadewithincompleteinformation.Twometricscurrentlybeingusedare:
ROI(returnoninvestment)andTCO(totalcostofownership)
ChapterSummary
E-marketersneeddatatoguidedecisionsaboutcreatingandchangingmarketingmixelements.Thesedataarecollectedfromamyriadofsources,filteredintodatabases,andturnedintomarketingknowledgethatisthenusedtodevelopmarketingstrategy.Knowledgemanagementistheprocessofmanagingthecreation,use,anddisseminationofknowledge.Amarketinginformationsystem(MIS)istheprocessbywhichmarketersmanageknowledge,usingasystemofassessinginformationneeds,gatheringinformation,analyzingit,anddisseminatingittodecisionmakers.
Marketerscantapthreesourcesofmarketingknowledge:
(1)internalrecords(suchascashflow,salesforcedata,andcustomerdata),
(2)secondarydata(publiclyandprivatelygenerated,fromonlinedatabases,andforcompetitiveintelligence),and(3)primarydata(gatheredforthefirsttimetosolveaparticularproblem).Competitiveintelligence(CI)involvesanalyzingtheindustriesinwhichafirmoperatesasinputtothefirm’sstrategicpositioningandtounderstandcompetitorvulnerabilities.Marketersmustevaluatethequalityofdatabeforerelyingonthemtosolveresearchproblems.
Primarydataiscollectedontheinternetbyover90percentofallcompanies.Thestepstoconductprimaryresearchare
(1)definetheresearchproblem,
(2)developaresearchplan,(3)collectdata,(4)analyzethedata,and(5)distributeresults.Internet-basedresearchmayincludeanyofthefollowingactivitiesconductedonline:
experiments,focusgroups,observations,andsurveys.Surveysmaybeconductedbye-mailinvitationtoaWebsite.Advantagestoonlinesurveysarethattheyarefastandinexpensive,havebroadreach,reduceerrors,elicithonestresponses,canberestrictedtoauthorizedparticipants,andareeasytotabulate.Disadvantagesincludepoorgeneralizabilityofresultsduetopoorsampleselection,self-selectionbias,inabilitytoconfirmtherespondent’sauthenticity,frivolousordishonestresponses,andduplicatesubmissions.
Onlinepanelsareincreasinglybeingusedtocombatsamplingandresponseproblemsofonlinesurveys.Althoughsomeofthesepanelsaresmall,otherscontainmillionsofparticipants.Someethicalconcernsofonlineresearchincludeunsolicitede-mail,harvestinge-mailaddressesfromnewsgroups,sellingunderthe