Page 138 - Foundations of Marketing

Marketing Research and Information Systems | Chapter 4 105

Databases

Most marketing information systems include internal data-
bases. A database is a collection of information arranged
for easy access and retrieval. Databases allow marketers to
tap into an abundance of information useful in making mar-
keting decisions—internal sales reports, newspaper articles,
company news releases, government economic reports, and
bibliographies—often accessed through a computer system.
Improvements in information technology have made it pos-
sible for firms to develop databases that are vastly enhanced
in their speed and storage capacity, to guide strategic plan-
ning and improve customer service. For instance, think about
the advertisement for the SAP HANA database. It uses 21 st-
century technology to consolidate all the data contained in a
database in order to speed processing and to allow a firm to
retrieve answers more quickly. The HANA database model
reduces redundancies and makes it easier for marketers to
retrieve the information that they need to make sound market-
ing decisions and improve customer relationship marketing.
Customer relationship management (CRM) employs data-
base marketing techniques to identify different types of cus-
tomers and develop specific strategies for interacting with each
customer. CRM incorporates these three elements:
1. Identifying and building a database of current and poten- Courtesy of SAP America, Inc.
tial consumers, including a wide range of demographic,
lifestyle, and purchase information.
2. Delivering differential messages according to each
consumer’s preferences and characteristics through Databases
SAP produces a revolutionary database, called HANA, which
established and new media channels.
reduces information redundancies, improves speed, and makes
3. Tracking customer relationships to monitor the costs
marketing decision making more efficient and accurate.
of retaining individual customers and the lifetime value
19
of their purchases.
database A collection of
Nearly all firms collect customer information in databases. For instance, many commer- information arranged for easy
cial websites require consumers to register and provide personal information before accessing access and retrieval

Marketing Debate

The Privacy of Purchase Data

ISSUE: Do the proposals of MasterCard and Visa or predict buying behavior. One of Visa’s proposals is
infringe on users’ privacy? to create user profiles based on credit card transactions
in stores as well as data from social networks, insur-
MasterCard and Visa announced plans to compile ance claims, or even DNA databanks. These profiles can
information about consumers’ purchases and sell it to then be used to target ads to specific market segments.
marketers for online advertising purposes. Rather than According to one senator, these plans have “unprec-
targeting a particular individual, the companies would edented and alarming” implications. The companies
use aggregate data to create market segments that respond that the information will be kept anonymous and
marketers could use to target ads toward specific areas d
that current laws limit how customer data is used.

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