Knowledge is Power

Submitted by sylvia.wong@up… on Tue, 10/05/2021 - 04:29
Sub Topics

Welcome to topic 3: Knowledge is Power. In this topic you will learn about:

  • Assessing information needs
  • Developing and capturing information
  • Turning data into insights and actions
  • Understanding and analysing the competition
  • The types of competitors.

This topic enhances the importance of analysis using real data to make informed marketing decisions. You will be exposed to a range of information sources, data collection methods, and exemplars on using data to create value for customers. This topic will also describe the classification of the types of competition and demonstrate techniques to identify competitors, which is critical for marketing strategies and plans.

These relate to the Subject Learning Outcomes:

  1. Demonstrate an understanding of the importance in business practice of market orientation.
  2. Evaluate market conditions and consumer needs when forming marketing strategies.

Welcome to your pre-seminar learning tasks for this week. Please ensure you complete these prior to attending your scheduled seminar with your lecturer.

Click on each of the following headings to read more about what is required for each of your pre-seminar learning tasks.

Read Chapter 4 and Chapter 18 of Kotler, P & Armstrong, G 2021, Principles of Marketing Global Edition, 18th edn., Pearson.

Read the following journal articles:

Read the following web articles and industry reports:

Read the case study, ‘Bayer: Big Data for Customer Insights’ on pp. 147-149 of the prescribed text.

Read and watch the topic content.

There are discussion forum activities for this topic, which will enhance your knowledge and give you the opportunity to interact with your peers. You can access the activities by clicking the following links. You can also navigate to the forum by clicking on ‘MKT100 Subject Forum’ in the navigation bar for this subject.

A pair of marketing executives discussing information on a laptop

Assessing information needs

Are decisions made based on gut feeling? To create customer value and build meaningful relationships with them, we must look into what the market and customers are telling us. This information and insights are needed to make key decisions regarding product, price, promotion, and other marketing-related issues.

Rather than create data and then decide what to do with it, firms should decide what to do first, and then which data they need to do it

(Mela & Moorman 2018).

A question to ask yourselves is, “How would this information be useful to us?” Companies can collect a wealth and information if they want to, but the quality rather than the quantity of information is the focal point here. As we discuss further, you will realise that the data collection process can be expensive and complex, so you may want to focus your efforts to collect information that you ‘need to know’ more so than the ones that are ‘good to know’.

A good marketing information system consists of different elements dedicated to assessing information needs, gathering information about elements within the marketing environments, and turning them into actionable insights (Kotler & Armstrong 2021).

A diagram showing the different parts of an information system

Adapted from Principles of Marketing Global Edition, by P Kotler & G Armstrong, 2021, Copyright 2021 18th edn. by Pearson Education Limited.

Developing and capturing information

When it comes to researching information about the marketing environment, also known as market research, data can be collected from primary and secondary sources. Each of these methods has its pros and cons. The following video explains why and how market research is carried out.

Secondary information sources

Information can come from many different sources, and chances are a business will have your customer data sitting in their repository every time you transact and interact with them (Keener 2020). You can learn more about the different types of data that are collected from you in the article, What is customer data?

These are known as ‘internal’ data - a secondary information source - because they are previously collected and readily available. The volume, velocity, and variety of data collected about individual consumers is a testament to the ‘Big Data’ revolution and the competitive advantage it can generate (Erevelles et al. 2016).

Another example of a secondary information source is publicly available information. You may have come across a few of them as part of your learning tasks. Could you name a few of them? Some of these ‘external’ secondary data include government statistics, industry associations, trade publications, company websites, and market research reports (Wolf 2016).

Primary information sources

Primary data is collected to answer a specific question or achieve a set of objectives. Primary data is usually collected by the business themselves or through market research companies (Kotler & Armstrong 2021). Primary data collection depends on the market research and its objectives. However, popular methods include surveys, focus groups, and interviews as stipulated on the Business Queensland website.

The following video explains how a focus group works.

Turning data into insights and actions

Customer insights are interpretations of quantitative and qualitative data gathered from customer feedback and other informational sources, which are then compiled and analysed to inform business decisions.
(Collinge 2020)

Raw data in itself does not tell us a story. We need to analyse it to gain insights that we can then act on. What are these actionable insights, you might ask? They could be used to develop a new product, improve an existing product, or create a more personalised customer experience, to name a few. These insights allow us to understand our customers better (Mandal 2018).

Access the following websites for examples of how different businesses use customer insights to deliver a more personalised:

From the following diagram, we can see that this personalisation process based on customer data could also be automated. For example, this could be the email newsletter you get or the recommendations you see on a website.

A diagram explaining the personalisation process

The following are examples of current information: behaviour on a website, type of referral, used keywords on a search engine, time and date, location, and device. 

Stored information also plays a role in the personalisation process. Examples include, purchase history, previous clickstreams, newsletter interaction, activity level and shared, commented or rated content. 

Examples of a customised object include, content, structure, and offer. 

Finally, we have the medium, which is where you would see the information appear. Examples of medium include a website, email, mobile app, or offline for example, mail. 

Adapted from ‘Marketing Automation, by I Heimbach, DS Kostyra & O Hinz, 2015, Business & Information Systems Engineering, 57(2):129-133, Copyright 2021 by Springer Nature Switzerland AG.

Creepy or convenient?
Have you ever gotten an advertisement that is so tailored and personalised to you that feel as though companies are spying on you? Read this Harvard Business Review article on Ads that don’t overstep and record your findings in your reflective journal. 
Knowledge check

Complete the following three (3) tasks. Click the arrows to navigate between the tasks.

Understanding and analysing the competition

Understanding your competitors’ strengths and their likely actions is essential to formulating a marketing plan. Competitor analysis is a driver of an organisations strategy, and it affects how a company reacts in the industry. Fleisher and Bensoussan (2003; 2007) define competitor analysis as a management tool used to assess the strengths and weaknesses of current and potential competitors. The competitor analysis involves developing answers to a series of questions regarding current strategy, assumptions, capabilities, responses and future objectives of both a business and its competitors (Adom, Nyarko & Som 2016).

Competitor analysis involves understanding:

  • Who is the target market?
  • Who are the major competitors?
  • Why do people buy from competitors?
  • Why should they switch to you?
  • Are your competitors satisfied with their current position?
  • Where are your competitors vulnerable?
  • What are your competitors doing well?

Types of competitors

There are different types of competitors, depending on whether you are examining them from a specific or broader sense (Kotler et al. 2017). We will explore the following concept using a fast-food restaurant that primarily serves burgers.

  1. Competitors can be viewed as businesses that offer the same or similar products. For example, Hungry Jack’s and Grill’d aim to serve the same target market with the same product.
  2. Competitors can be viewed as businesses that offer a slightly different product, usually within the same class of product (fast food). For example, KFC and Taco Bell both specialise in fast food, but their main focus is not burgers but fried chicken and tacos, respectively.
  3. Competitors can also be viewed more broadly to include other businesses that satisfy the same needs and wants. For example, other cafes or restaurants offer options that can satisfy the same need of hunger.
  4. The broadest sense we can view this is all other businesses that can compete for the consumer dollars. If consumers are not spending money on prepared food or to get food, where else might they spend that money?
A diagram showing different types of competitors

Adapted from Marketing for hospitality and tourism, 7th edn. by P Kotler, JT Bowen, JC Makens, & B Seyhmus 2017, Pearson, p. 111, Copyright 2017 by Pearson Education Limited.

Identifying the right competition and customer behaviour is essential to identifying marketing strategies. It is important to know what else the customers are buying in the same category. Some of the questions that help identify the competition are:

  • When customers eat out, which are the different restaurants that they could consider?
  • If they do not come to my restaurant, which restaurant do they go to?
  • For those who come to my restaurant, where else do they go?

These questions help managers to examine competition in terms of customer behaviour. For example, if customers who stay in 3-star hotels also stay in 5-star hotels, then the competition may not be in relation to the luxury or price range. Still, it could be convenience or geographical location.

Knowledge check

Complete the following two (2) tasks. Click the arrows to navigate between the tasks.

Key takeouts

Congratulations, we made it to the end of the third topic! Some key takeouts from Topic 3:

  • Knowledge is key to making better business and marketing-related decisions, but we must decide what information we 'need to know' versus the ones that are 'good to know'.
  • There are many different sources of information, for example from secondary sources which are previously collected information, and from primary sources, which is original research by a business to answer a specific question or achieve a set of objectives.
  • Any information collected should be turned into insights and actions.
  • Identifying competitors and analysing them can uncover information that is essential when formulating marketing strategies.

Welcome to your seminar for this topic. Your lecturer will start a video stream during your scheduled class time. You can access your scheduled class by clicking on ‘Live Sessions’ found within your navigation bar and locating the relevant day/class or by clicking on the following link and then clicking 'Join' to enter the class.

Click here to access your seminar.

The learning tasks are listed below. These will be completed during the seminar with your lecturer. Should you be unable to attend, you will be able to watch the recording, which can be found via the following link or by navigating to the class through ‘Live Sessions’ via your navigation bar.

Click here to access the recording. (Please note: this will be available shortly after the live session has ended.)

In-seminar learning tasks

The in-seminar learning tasks identified below will be completed during the scheduled seminar. Your lecturer will guide you through these tasks. Click on each of the following headings to read more about the requirements for each of your in-seminar learning tasks.

This learning task will give you a glimpse into how businesses use data to make better marketing-related decisions. To start, look into how Netflix adopts a data-driven marketing approach (see links provided below). After you have finished reading, work in a breakout room assigned by your lecturer during the scheduled seminar. Your lecturer will request that you present the findings back to the class:

Questions

  1. How do you think collecting a vast amount of data allows Netflix to be customer-centric?
  2. What is the key success factor of Netflix’s data-driven marketing strategies?
  3. What other internal data can Netflix use, and how would Netflix further personalise their customer experience using these data?
  4. Select a different industry (e.g., retail, automobile) and explain how they might apply Netflix’s approach to data insights.

This learning task will put what you have learned into practice and help you perform a competitor analysis. In the same breakout room as previously, select an organisation and perform a comprehensive analysis on three (3) of their main competitors.

It is up to your group how you would like to present your analysis. You can choose to follow one of the templates provided in either the pre-seiminar learning tasks or use the Topic 3 Worksheet Template.

Your lecturer will request that you present the findings back to the class.

Welcome to your post-seminar learning tasks for this week. Please ensure you complete these after attending your scheduled seminar with your lecturer. Your lecturer will advise you if any of these are to be completed during your consultation session.

Click the following headings to learn more about your post-seminar learning tasks.

Reflect on this topic. Prepare a list of key terms with their definitions and summarise the key points in your own words. Share these with your lecturer in your reflective journal. 
You can also access the reflective journal by clicking on ‘Journal’ in the navigation bar for this subject.

Reflect and consider how businesses use customer data, which can relate to your Assessment 1. Is this benefiting the consumers, businesses or both parties?

Each week you will have a consultation session, which will be facilitated by your lecturer. You can join in and work with your peers on activities relating to this subject. These session times and activities will be communicated to you by your lecturer each week. Your lecturer will start a video stream during your scheduled class time. You can access your scheduled class by clicking on ‘Live Sessions’ found within your navigation bar and locating the relevant day/class or by clicking on the following link and then clicking 'Join' to enter the class.

Click here to access your consultation session.

Should you be unable to attend, you will be able to watch the recording, which can be found via the following link or by navigating to the class through ‘Live Sessions’ via your navigation bar.

Click here to access the recording. (Please note: this will be available shortly after the live session has ended.)

References

  • Adom, AY, Nyarko, IK & Som, GNK 2016, ‘Competitor analysis in strategic management: Is it a worthwhile managerial practice in contemporary times?’, Journal of Resources Development and Management, 21:116-127.
  • Business Queensland 2021, What's included in market research, https://www.business.qld.gov.au/starting-business/planning/market-customer-research/market-research/included
  • Collinge, R 2020, How to gather and use customer insights to improve experience, Hubspot, https://blog.hubspot.com/service/how-to-use-customer-feedback
  • Deloitte n.d., Connecting with meaning: hyper-personalizing the customer experience using data, analytics, and AI, https://www2.deloitte.com/content/dam/Deloitte/ca/Documents/deloitte-analytics/ca-en-omnia-ai-marketing-pov-fin-jun24-aoda.pdf
  • Erevelles, S, Fukawa, N & Swayne, L 2016, ‘Big Data consumer analytics and the transformation of marketing’, Journal of Business Research, 69(2):897-904.
  • Farese, D 2021, How to do market research: a guide and template, Hubspot, https://blog.hubspot.com/marketing/market-research-buyers-journey-guide
  • Fleisher, C & Bensoussan, B 2003, Strategic and competitive analysis: effective application of new and classic methods, Prentice Hall.
  • Fleisher, C & Bensoussan, B 2007, Business and competitive analysis: effective application of new and classic methods, FT Press.
  • Heimbach, I, Kostyra, DS & Hinz, O 2015, ‘Marketing Automation’, Business & Information Systems Engineering, 57(2):129-133.
  • John, LK & Kim, T 2018, Ads that don’t overstep, Harvard Business Review, https://hbr.org/2018/01/ads-that-dont-overstep
  • Keener, M 2020, What are different types of customer data?, Insightly, https://www.insightly.com/2020/04/customer-data-types/
  • Kotler, P, Bowen, JT, Makens, JC & Seyhmus, B 2017, Marketing for hospitality and tourism, 7th edn., Prentice Hall.
  • Maksimava, M 2021, How to perform a best-in-class competitor analysis (w/ template), Buffer, https://buffer.com/library/competitor-analysis/
  • Mandal, PC 2018, ‘Marketing information and marketing intelligence: roles in generating customer insights’, International Journal of Business Forecasting and Marketing Intelligence, 4(3):311-321.
  • McGonagle Jr. JJ & Vella, CM 2004, ‘Competitive intelligence in action’, Information Management Journal, 38(2):64-68.38(2):64-68.
  • Mela, CF & Moorman, C 2018, Why marketing analytics hasn’t lived up to its promise, Harvard Business Review, https://hbr.org/2018/05/why-marketing-analytics-hasnt-lived-up-to-its-promise
  • Pandey, A 2020, ‘Why you need to do competitor analysis to succeed in marketing your brand’, Psychology and Education Journal, 57(9):3521-3527.
  • Typeform n.d., The 8 types of market research—and how to use them, https://www.typeform.com/surveys/types-of-market-research/
  • Wedel, M & Kannan, PK 2016, ‘Marketing analytics for data-rich environments’, Journal of Marketing, 80(6):97-121.
  • White, C 2021, What’s a competitive analysis and how do you conduct one?, Hubspot, https://blog.hubspot.com/marketing/competitive-analysis-kit
  • Wolf, A 2016, Primary data vs. secondary data: market research methods, https://blog.marketresearch.com/not-all-market-research-data-is-equal
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