The term “marketing information system” refers to a collection of procedures and methods for the systematic and planned gathering, processing, and display of data to make marketing choices.
As a collection of procedures and methods, marketing information systems provide the timely gathering and dissemination of objective, trustworthy, and correct information to marketing managers consistently in order for them to make educated decisions.
A marketing information system is a complex system comprised of several subsystems that a business uses to gather, analyse, and store data as required by marketing managers periodically.
The marketing information system is designed to regularly collect pertinent information from the external marketing environment and distribute it to marketing managers after necessary editing and processing to assist in planning, organisation, and control activities.
Marketing choices made by firm leaders and action plans produced by an organisation in light of gathered data are quickly communicated to other market participants. All of this information becomes a part of the broader marketing environment. Other businesses learn about these competitive acts and other market developments through their marketing information systems and adapt their marketing policies and plans accordingly.
As with the initial business, the decisions and actions performed by rivals quickly become part of the wider environment and become known to other market participants. Thus, the process continues cyclically, enabling each firm to understand what is occurring in the market and how it should adapt to the changing environment via its marketing information system.
Structure of Marketing Information System
MIS systems comprise four components: user interfaces, application software, databases, and system support. The following is a breakdown of each of these elements:
1) User interfaces: The user interface is the portal where users, like managers or marketers, engage with the MIS, which aims to provide access to data in a manner that can be grasped without needing advanced technical know-how. It comprises dashboards, graphical displays, and reports that provide users with the ability to enter queries and view results in real time, ensuring simplicity and comprehensiveness.
For example, a marketing manager may employ a user interface to track campaign performance metrics, such as click-through rates or customer engagement trends, displayed in an easily understandable manner. Prioritizing usability, the user interface enables non-technical users to derive valuable insights, facilitating quicker and better-informed decision-making based on particular business requirements, such as the optimization of marketing strategies.
2) Software for applications: Application software refers to the tools and programs used to process raw data to create useful outputs, streamlining work and providing insights aligned with business objectives. Such tools, as Customer Relationship Management (CRM) systems such as Salesforce or analysis tools such as Google Analytics, undertake activities such as data analysis, sales predictions, or segmentation of customers, breaking down sophisticated datasets into actionable intelligence.
Within the marketing context, application software may look at customers’ behavior and pick out high-value segments or determine the efficiency of promotional efforts. By reducing the drudgery of repetitive tasks and allowing for intricate calculations, this element provides decision-makers with the accurate information to lead strategic actions and keep pace with the competitive advantage.
3) Marketing to databases: Databases are the central repositories in which structured data is stored, maintained, and retrieved, constituting the backbone of the MIS. Relational database management systems store important information such as customer profiles, sales histories, or market trends, rendering it available for analysis and reporting.
In marketing, a database could hold rich customer buying histories or campaign responses, enabling teams to query certain datasets for targeted advertising or personalization initiatives. By making data systematically available and accessible, databases facilitate effective decision-making, offering the basis for deriving insights that align with organizational goals and market needs.
4) Support for the system – System managers manage and maintain system assets, such as software and hardware networks, as well as monitor their actions and verify compliance with corporate regulations.
MIS systems also include Marketing Decision Support Systems (MDSS), which rely on basic data collection tools like Microsoft Excel, SPSS, and online analytical tools. A data warehouse, basically a data repository system that helps store and further process data obtained internally and externally, is where data generated for analysis is kept and processed.
Advantages of Marketing Information System (MIS)
“With a more competitive and developing market, the quantity of information required every day by a business is substantial,” according to Bhasin. As a result, they’ll need to set up a marketing information system. Marketing information systems have several advantages.
Improved Decision Making: Marketing information systems use data collected from various sources, which provides deep insight for any decision-making purpose. Hence, the decision is based on relevant data and facts, which improves the quality of the decision-making process.
Organise Data Collection – MkIS can assist managers in organising large amounts of data gathered from the market, resulting in increased productivity.
A wide view — With a proper MkIS in place, the organisation can be followed and separate processes can be analysed. This aids in the development of a larger viewpoint, allowing us to determine which activities may be done to support improvement.
Storage of Critical Data – The storage of critical data is critical in execution, demonstrating once again that MkIS is necessary not only for information but also for execution.
Coordination – Consumer Durables and Fast-Moving Consumer Goods (FMCG) firms have a large number of processes that must be coordinated. These businesses rely entirely on MIS to keep their operations running smoothly.
MIS plays a critical role in the planning process, as the planning technique necessitates the gathering of information. The organisation’s strengths must come first in planning, followed by the business environment, and lastly, competitive analysis. All of these are included by default in a functioning MkIS and are updated regularly. As a result, MkIS is critical for planning and analysis.
Disadvantages
High Implementation and Maintenance Costs
It is costly to implement and maintain a Marketing Information System, and this presents a major challenge to organizations, especially small firms with limited financial resources. The installation involves the investment of hardware, software, and trained personnel to develop and integrate the system, and the continuous costs involve software updates, data storage, and technical support to keep the system running smoothly. For instance, a business will have to acquire specialized CRM software or analytics suites and retain IT personnel to operate them, taking away resources from other marketing efforts. Such financial investments can pressure budgets and might not generate short-term returns, making cost a vital downside for businesses that have limited resources.
Complexity and Training Requirements
An MKIS can be complicated to use, necessitating prolonged training for employees to utilize it to its full potential, which increases organizational expenses and time expenditures. The advanced features of the system, including data analytics dashboards or customer segmentation software, can overwhelm nontechnical end-users, causing underutilization or incorrect data interpretation.
For example, a marketing group without database querying experience can improperly interpret campaign performance metrics, leading to poor strategies. The necessity of ongoing training to maintain personnel abreast of new features or system updates complicates adoption even further, decelerating decision-making and lessening the efficiency of the system overall.
Data Overload and Misinterpretation
A key drawback of an MkIS is the possibility of data overload, in which the system creates a huge amount of information that might overwhelm people and hide meaningful information. The marketing teams will not be able to sift valuable information from irrelevant noise, causing paralysis in analysis or bad decisions.
Furthermore, misinterpretation of information based on limited context or inexperience may lead to poor strategies, such as confusing correlation with causation in customer behavior patterns. Without appropriate data governance and analytical competence, the system’s output can obfuscate instead of illuminate, negating its value in informing effective marketing decisions.
Dependence on Technology and Vulnerability to Failures
An MKIS is technology-dependent and thus susceptible to technical breakdowns, cyber intrusions, or system outages that can bring marketing activities to a standstill. A server crash or a data breach might freeze access to valuable customer intelligence or leak confidential information, which can harm the organization’s reputation and customer trust.
For instance, a merchant that relies on an MKIS for real-time tracking of sales and inventory would experience serious losses if the system fails during a high-demand shopping season. The excessive use of technology, along with the requirement for strong cybersecurity measures, introduces threats that undermine the reliability and efficiency of the system.
Conclusion
In conclusion, a Marketing Information System (MIS) is much more than just a data repository; it’s a strategic asset that fuels smarter marketing decisions. By providing a comprehensive view of the market, customers, and competitor landscape, an MIS empowers businesses to navigate the complexities of today’s dynamic marketplace.
The advantages go beyond short-term wins. An MIS fosters a data-driven culture within marketing teams, where decisions are grounded in insights rather than hunches. This not only improves efficiency but also builds a foundation for continuous improvement. As the business landscape evolves, an MIS equips marketers with the agility to adapt their strategies and seize new opportunities.
