Marketing information system refers to an organized set of procedures, information handling routines, communication and reporting techniques designed to provide information required for making marketing decisions. It involves –
- Accessing Internal and External sources of information
- Identifying information problems and providing solutions to prevent these problems
- Analysis and processing of data
- Provision of information for future decision making
- Communicating and Reporting Information
- Monitoring Deviations in Performance
According to Alder Lee, “Marketing information system is an interacting, continuing, future oriented structure of people, equipment and procedure designed to generate and process an information flow which can aid business executives in the management of their marketing programmes”
Marketing Information system is an integrated combination of data processing, data analysis, data specialists and reporting for the purpose of making informed marketing decisions.
Components of Marketing Information System
- Internal Marketing Information and Reporting System – It includes the internal records of a business like sales reports, order history, inventory levels, cost sheets, etc.
- Marketing Intelligence System – It refers to the systematic collection and analysis of the external marketing environment. It involves collection of information regarding the current market trends, competitor`s strategies, changing customer needs, changing market conditions, relevant developments etc. from publicly available information.
- Marketing Research System – It is a system of systematic collection, analysis and reporting of data and findings relevant to a certain marketing situation faced by a business. Information is collected through various research techniques such as questionnaires, market surveys, tests, observations etc.
- Analytical Marketing System / Decision support system – This component involves processing of data, analysis of data, conversion of raw data into meaningful information and interpreting and reporting information to make sound decisions. Many mathematical tools like time series analysis, linear programming, regression analysis, sensitivity analysis etc. are used to analyze and interpret data.
Importance of Marketing Information System
- It helps in understanding customer needs and wants
- It helps in monitoring the marketing environment and market trends
- It aids in making sound future decisions
- It helps in formulating marketing and strategic development plans
- It facilitates coordination of activities within the marketing department
- It helps in reducing costs and saving time by eliminating wastage