Notes

Definition and Importance of Marketing Analytics What is Marketing Myth 1. Marketing is Advertising. "Marketing is to communicate with customers" Myth 2. Marketing is sales. "Marketing is to build relationship in the long-term" Myth 3. Marketing is cost. "Marketing is investment"

"Marketing is the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large" (AMA). "Marketing is satisfying needs and wants through an exchange process." (Philip Kotler)

"Marketing is to know and understand the customer..." (Peter Drucker) "Marketing is to create value through customer acquisition and retention".

What is Marketing Analytics?

"Marketing Analytics" is a technology-enabled and model-supported approach to harness customer and market data to enhance marketing decision making. - Lilien, Gary L. (2011), Journal of Marketing.

Marketing analytics is defined as the methods for measuring, analyzing, predicting, and managing marketing performance with the purpose of maximizing effectiveness and return on investment (ROI)" - Wedel and Kannan 2016).

Background of Marketing Analytics

It is interdisciplinary: The nexus of marketing and other areas of business, mathematics, statistics, economics, econometrics, psychology, psychometrics, and computer science.

Why Marketing Analytics? Because we need to understand consumers better:

• Consumer preference changes faster than ever.
• Consumers get more sophisticated.
• Consumers are often skeptical about marketing.

Because we need to understand competitors too:

• There is not only a firm in markets.
• Competitors react.
• How do a firm respond to this?
• How do customer respond to this?
• Marketing Accountability
  • "It's a noisy laboratory in which a marketing leader is going to try to make the connection between an action and an outcome".
  • "Marketers do face challenges including proving the effectiveness of their work, which is complicated because customers, competitors, and large forces continually change."

Because we can:

• Data Explosion
  • Volume
  • Velocity
  • Variety
• Enhanced computing power
• New and improved techniques
  • For gathering data
  • For analyzing data

Marketing Analytics Provides...

Timeline of Marketing Data and Analytics

Current trends in traditional offline retail

• Sensors capture all activities in front of a shelf.
• The following actions are registered:
• Touch
• Pick-Up
• Return

Types of Marketing Metrics

Types of Data and Data Collection

The difference between Primary and Secondary data is whether the researchers have clear research objectives for that data or not, which means having collected the data explicitly for that purpose.

Process for Marketing Analytics The Research Process

Ethical Issues in Marketing Analytics

• 50% of consumers believe online advertisers (e.g., websites) do not comply with privacy laws. More than 75% of consumers think: firms have more information about them than they are comfortable with.
• What would be the consequence? How does the ethical concern affect marketing analytics? There will be increased emphasis on data minimization and anonymization.
• Data minimization is the process of limiting the type and amount of data firms collect.
• Less individual data may be available for marketing analytics.
• We need methods and models to protect data security and privacy and maximize personalized marketing opportunities.