Transcript CHAPTER 6 SECONDARY DATA SOURCES

CHAPTER 6
SECONDARY DATA SOURCES
Important Topics of This
Chapter
• Success of secondary data.
• To understand how to create an internal database.
• To distinguish between primary and secondary
data and understand the advantages and
disadvantages of each.
• Locating secondary data base.
• To understand the role of the Internet in obtaining
secondary data.
• To learn the nature of decision support systems.
The Nature of Secondary Data
Secondary data are pieces of information
that have been gathered and only might be
relevant to the problems at hand. Primary
data, in contrast, are survey, observation, or
experiment data collected to solve the
particular problem under investigation.
Sources of Secondary Data
There are two primary sources of
secondary data:
The Company Itself
(Internal Databases)
Other Organizations or
Persons
(External Databases)
Different Types of Databases
•
•
•
Internal databases.
External databases.
Computerized databases:
• Internet
• CD ROM
•
Bibliographic databases:
• Academic indexes.
• Citation indexes.
•
Numeric databases:
• Census data.
• Survey of Buying Power
•
Directory databases:
• Industry directories
• SIC/NAICS
•
Full-text databases:
• Selected publications.
Creating an Internal Database
• A database is simply a collection of related
information.
• For many companies, a computerized database
containing information about customers and
prospects has become an essential marketing tool.
• Creating an internal marketing secondary database
built upon sales results and customer preferences
can be a powerful marketing tool.
Keys to a Successful Internal
Database
Organizations Must
Create a Database
Management System
Database Users Must be
Trained on How to
Retrieve Information and
How to Manipulate the
Data Using Database
Management Software
The Growing Importance of
Internal Database Marketing
• Database Marketing
– Is the creation of a large computerized file of
customers’ and potential customers’ profiles
and purchase patterns.
– Is the fastest-growing use of internal database
technology.
Uses of Database Marketing
• Evaluate sales territory.
• Identify most profitable and least profitable
customers.
• Identify most profitable market segments
and target efforts with greater efficiency and
effectiveness.
Uses of Database Marketing
• Aim marketing efforts to those products, services,
and segments that require the most support.
• Increase revenue through repackaging and repricing products for various market segments.
• Evaluate opportunities for offering new products
or services.
• Identify products or services that are best-sellers
or most profitable.
• Evaluate existing marketing programs.
Issues Involving Internal
Databases
• Database Technologies
– Database technologies continue to evolve. For example,
Fingerhut, a database firm, uses a Sun Microsystems
parallel computer, whereas American Express relies on
Thinking Machines Corporation’s supercomputers.
– Renting Internal Databases
– Some companies rent their internal databases to obtain
extra income, although this can lead to ethical
questions.
Issues Involving Internal
Databases
• Published Secondary Data
– Internal
• Published secondary information originating with the company
includes documents such as annual reports, reports to
stockholders, and product testing results perhaps made
available to the news media.
• External
• Innumerable outside sources of secondary information also
exist, principally in the forms of government departments and
agencies that compile and publish summaries of business data.
Advantages of Secondary Data
• Secondary information may:
• Help to clarify or redefine the definition of the
problem as part of the exploratory research process.
• Actually provide a solution to the problem.
• Provide primary data research method alternatives.
• Alert the marketing researcher to potential problems
or difficulties.
• Secondary information may:
• Provide necessary background information and
build creativity for the research report.
Limitations of Secondary
Information
• Lack of Availability
– For some research questions there are simply no available data.
For example, if Kraft General Foods wanted to evaluate the taste,
texture, and color of three new gourmet brownie mixes, there are
no secondary data that would answer these questions.
• Lack of Relevance
– It is not uncommon for secondary data to be expressed in units or
measures that cannot be used by the researcher.
• Inaccuracy
– Users of secondary data should always assess the accuracy of the
data. There are a number of potential sources of error when a
researcher gathers, codes, analyzes, and presents data.
Evaluating Secondary Data
Guidelines for determining secondary data accuracy
Who collected the
information?
What was the purpose of the
study?
What information was
collected?
How was the information
obtained?
When was the information
collected?
How consistent is the information with
other information?
The Internet and the World Wide
Web
• Internet
– World-wide telecommunications network that
allows computers to access data, files, pictures
and sound throughout the world.
• World Wide Web
– Component of the Internet designed to make
transmission of text and images very easy.
Finding Secondary Data on the
Internet
• Uniform Reference Locator (URL)
– Internet address that identifies a specific location.
– A typical Web address looks like the following:
http://www.microsoft.com
• Search Engines
– Internet search directories to aid in locating topics
of interest and URLs.
– An example is Yahoo at http://www.yahoo.com
Other Sources of Secondary Data
• Newsgroups on the Internet
• Internet sites devoted to a specific topic where people can read
and post messages.
• Databases on CD ROM
• A number of companies offer database packages on CD ROM
for personal computers.
• Geographic Information Systems
• Computer-based system that uses secondary and/or primary
data to generate maps that visually display answers to research
questions.
Information Management
Computerized databases, published secondary
data, the Internet, and internal databases are
important parts of an organization’s information
system. Intelligent decision making is always
predicated on having good information. The
problem today is how to manage all the
information available.
Decision Support Systems
• Decision Support System
– An interactive, personalized MIS, designed to
be initiated and controlled by individual
decision makers.
– Managers use decision support systems to
conduct sales analyses, forecast sales, evaluate
advertising, analyze product lines, and keep
tabs on market trends and competitor analysis.
Decision Support Systems
Characteristics of a true DSS are as follows:
Interactive
Discovery
Oriented
Flexible
Easy to Learn
and Use
Advantages of an Effective DSS
• Substantial Cost Savings
• Understanding of the Decision Environment
is Increased
• Decision-Making Effectiveness is Upgraded
• Information Value is Improved