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Maximizing Value with a Marketing Decision Support System

Explore the importance of Marketing Decision Support Systems in making strategic decisions, understanding information sources, and interpreting relevant data to enhance business outcomes. Learn how to leverage an MDSS effectively in uncertain business environments.

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Maximizing Value with a Marketing Decision Support System

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  1. Value of the Marketing Decision Support System Understand the purpose of a marketing decision support system (MDSS) • Competitively Uncertain Situations • Select the best action to solve the problem • Manager’s ability to use information decisively • Information interpretation begins with • An understanding of where the information comes from • How the information is obtained • The relevancy of the information to the business situation being examined McGraw-Hill/Irwin

  2. Understand the purpose of a marketing decision support system (MDSS) Value of the Marketing Decision Support System • Correct interpretation of information is affected by time • Information must be collected in a timely, on-going manner • Systematic gathering of information on a longitudinal basis • Correct Interpretation of information centers on its accuracy • Avoid biased information—collect from several sources or use several different approaches McGraw-Hill/Irwin

  3. CRM and the Marketing Decision Support System Understand the purpose of a marketing decision support system (MDSS) • Customer Relationship Management (CRM) • Growth in the electronic marketplace • Purpose of automating Customer operational procedures • CRM process strategic outcome McGraw-Hill/Irwin

  4. Describe the various information requirements used to design an MDSS Marketing Decision Support System • Marketing Decision Support System (MDSS) • A computer based system intended for use by particular marketing personnel at any functional level for the purpose of solving semi-structured problems • Unique Characteristics to the MDSS McGraw-Hill/Irwin

  5. Describe the various information requirements used to design an MDSS Exhibit 5.1 McGraw-Hill/Irwin

  6. Describe the various information requirements used to design an MDSS Marketing Decision Support System • Marketing Decision Support System Diagram • Stores and Categorizing Three Groups of Marketing Groups of Market-driven Info • Environmental • Transactional • competitive McGraw-Hill/Irwin

  7. Describe the various information requirements used to design an MDSS Marketing Decision Support System • Information is Contained Using • Computer • Marketing research database • Specialized software • Information Processing System • Manipulates information and provides output • Specialized reports • Responses to database queries • Model simulations McGraw-Hill/Irwin

  8. Describe the various information requirements used to design an MDSS Marketing Decision Support System • Information requirements • Information in MDSS—Secondary Data • MDSS Designed to Provide Solutions to Current Problems • Contains actual market data not intentions or attitudes • Provides a picture of what happened in the past • The present and the future can be put in perspective McGraw-Hill/Irwin

  9. Describe the various information requirements used to design an MDSS Marketing Decision Support System • Environmental Information • Information on Supplies • Helps insure that the company has the necessary raw materials and service to react to changes in the market • Reliable information—considerations such as cost, quality, and product reliability McGraw-Hill/Irwin

  10. Describe the various information requirements used to design an MDSS Marketing Decision Support System • Criteria Established and Used to Evaluate Suppliers • Dollar volume by season and year • Growth or shrinkage of annual dollar volume • Accuracy of shipping and billing • Timeliness of deliveries • Price terms and allowance • Returns and procedures • Greatest Advantage • Supplier can be selected or replaced immediately McGraw-Hill/Irwin

  11. Describe the various information requirements used to design an MDSS Exhibit 5.2 McGraw-Hill/Irwin

  12. Describe the various information requirements used to design an MDSS Marketing Decision Support System • Distribution Partners • Distributors/Wholesales • Advantages over selling direct to retailer • Offer packaging and shipping services • Reduce inventory carrying needs • Reduce credit risks • Simplify bookkeeping McGraw-Hill/Irwin

  13. Describe the various information requirements used to design an MDSS Marketing Decision Support System • Hard Data Related to Wholesalers • Levels of inventory carried by various wholesalers • On-time delivery performance • Minimum ordering requirements • Transportation costs • Repairs, allowances, and adjustments • Level of service McGraw-Hill/Irwin

  14. Describe the various information requirements used to design an MDSS Exhibit 5.3 McGraw-Hill/Irwin

  15. Understand the role of transactional data in MDSS Marketing Decision Support System • Business Intelligence • Procedure for collecting daily operational information pertinent to the company and the markets it services • Collection Process • Transactional Data • Information resulting from a transaction usually by consumers and the retailer McGraw-Hill/Irwin

  16. Marketing Decision Support System Understand the role of transactional data in MDSS • Five Technologies—Collect and Maintain Transactional Data • Bar Coding • Optical Scanners • Universal Product Code (UPC) • Shipper Container Marking (SCM) • Automatic Replenishment System (ARS) • Electronic Data Interchange (EDI) • Direct Data Interchange • Third-party Networks • Reader Sorter McGraw-Hill/Irwin

  17. Describe the various information requirements used to design an MDSS Exhibit 5.4 McGraw-Hill/Irwin

  18. Describe the various information requirements used to design an MDSS Exhibit 5.4 McGraw-Hill/Irwin

  19. 3 Key Elements of the MDSS Database Computer Facilities Software System Primary Function MDSS Produce Reports Computer and Software System Reflect the need of the user Provide reports quickly Sort and print specific data Be easy to read, use, and manipulate Be custom-made versus prewritten systems Explain the relationship between the decision support system and business Information Processing and the MDSS McGraw-Hill/Irwin

  20. Explain the relationship between the decision support system and business Information Processing and the MDSS • Statistical Software systems • Analyze large volumes of data and compute basic statistics such as means and standard deviations • Managerial Function Software Systems • Forecasting Systems • Product/brand Management Software Systems • Promotional Budget System McGraw-Hill/Irwin

  21. Understand the Various models used in an MDSS MDSS Models and Output • Model • Abstraction that explains some phenomenon or activity • Purpose of the output • To provide a solution to the problem, the solution effort was generated by modeling techniques McGraw-Hill/Irwin

  22. Provide examples of output from an MDSS Exhibit 5.7 McGraw-Hill/Irwin

  23. Provide examples of output from an MDSS Exhibit 5.8 McGraw-Hill/Irwin

  24. Understand the Various models used in an MDSS MDSS Models and Output • Geographic Information System • Simulation that uses a spatial modeling technique in conjunction with data drawn from the MDSS • Can analyze market areas and learn where certain defined demographic characteristics overlap • Sets geographic parameters • Can create “what if” scenarios McGraw-Hill/Irwin

  25. Understand the Various models used in an MDSS Exhibit 5.9 McGraw-Hill/Irwin

  26. Understand the Various models used in an MDSS MDSS Models and Output • MDSS and Queries as an Output Resource • Queries • Can retrieve information from the system—requiring no special software • Queries arise after data are presented to the analyst McGraw-Hill/Irwin

  27. Relationship that exists between the decision support system and business intelligence Business Intelligence Programs • Business Intelligence Program (BIP) • Formal continuously evolving process—to assess the evolution of its industry and the capabilities of current and potential competitors • Tools and Techniques • Governmental agencies • On-line databases • Company and investment community resources • Surveys and interview • Drive-by and on-site observations • Benchmarking • Defensive Competitive Intelligence • Reverse engineering McGraw-Hill/Irwin

  28. Summary • Value of the Marketing Decision Support System • CRM and the Marketing Decision Support System • The Marketing Decision Support System • Information Process and MDSS • MDSS Models and Output • Business Intelligence Programs McGraw-Hill/Irwin

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