INTERNAL RECORDS AND MARKETING INTELLIGENCE
Marketing managers rely on internal reports on orders, sales, prices, costs, inventory levels, receivables, payables, and so on. By analyzing this information, they can spot important opportunities and problems.
The Order-to-Payment Cycle
The heart of the internal records system is the order-to-payment cycle. Sales representatives, dealers, and customers send orders to the firm. The sales department prepares invoices and transmits copies to various departments. Out-of-stock items are back ordered. Shipped items are accompanied by shipping and billing documents that are sent to various departments.
Todayâ€™s companies need to perform these steps quickly and accurately. Customers favor firms that can promise timely delivery. Customers and sales representatives fax or e-mail their orders. Computerized warehouses quickly fill these orders and dispatch he goods direct to the customer. Because of computerization and Internet the warehouses as far as possible are closer to the plants. This helps to keep lower inventories in the supply chain.
The billing department sends out invoices as quickly as possible. An increasing number of companies are using the Internet and extranets to improve the speed, accuracy, and efficiency of the order-to-payment cycle.
Sales Information System
Marketing managers need timely and accurate reports on currents sales. Wal-Mart, for example, knows the sales of each product by store and total each evening. This enables it to transmit nightly orders to suppliers for new shipments of replacement stock. Wal-Mart shares its sales data with its larger suppliers such as P&G and expects P&G to re-supply Wal-Mart stores in a timely manner. Wal-Mart has entrusted P&G with the management of its inventory.
Companies must carefully interpret the sales data so as not to get the wrong signals.
Technological gadgets are revolutionizing sales information systems and allowing representatives to have up-to-the-second information. In visiting one of the 10,000 golf shops around the country, sales reps for Taylor Made used to spend up to two hours counting golf clubs in stock before filling new orders by hand. Since the company gave its reps handheld devices with bar-code readers and Internet connections, the reps now simply point their handhelds at the bar codes and automatically tally inventory. By using the two hours they save to focus on boosting sales to retail customers, sales reps improved productivity by 20%.
Databases, Data Warehousing, and Data Mining
Today companies organize their information in database customer database, product database, salesperson database and then combine data from the different databases. The customer database will contain every customerâ€™s name, addresses, past transactions, and even demographics and psychographics (activities, interests, and opinions) in some instances. Instead of a company sending a mass â€œcarpet bombingâ€? mailing of a new offer to every customer in its database, it will score the different customers according to recent purchases, frequency and monetary value. It will send the offer only to the highest scoring customers. Besides saving on mailing expenses, this will often achieve a double-digit response rate.
Pizza Hut claims to have the largest fast-food customer data warehouses in the world, with 40 million us households â€“or between 40 to 50 % of the US Market. The millions of customer records are gleaned from point-of-sale transactions at its restaurants. Pizza Hut can slice and dice data by favorite toppings, date of the last order, or by whether you order a salad with your pepperoni pizza. Pizza Hut has not only been able to purge expensive duplicates from its direct-mail campaigns, but can also target its marketing to find the best coupon offers for each household and predict the success of campaigns.
Companies warehouse this data and make them easily accessible to decision makers. Furthermore, by hiring analysts skilled in sophisticated statistical methods, they can â€œmineâ€? the data and garner fresh insights into neglected customer segments, recent customer trends, and other useful information. The customer information can be cross-tabbed with product and salesperson information to yield still deeper insights. To manage all the different databases efficiently and effectively, more firms are using business integration software
Using its own-in-house technology, Wells Fargo has developed the ability to track and analyze every bank transaction made by its 10 million retail customers whether at ATMs, bank branches, or online. When transaction data are combined with personal information provided by customers, Well Fargo can come up with targeted offerings to coincide with a customerâ€™s life-changing event.
We can conclude the advances in information technology and innovation in marketing systems is boosting the ability of marketing managers giving them an opportunity to react much faster to their customer needs and end up with closing the sale successfully and customer satisfaction. Today the market information is sought in seconds. Gone are the days when the marketing manager had o wait for weekly reports of his local rep. The faster information is leading to a lesser inventory burden on supply chain and consequently the inventory carrying costs.