 As-Salaam-Alaikum-Khawatin-Hazrat. Wasim As-San welcomes you to lecture number 12 of Marketing for Non-Profites, MKT 628, at the Virtual University of Pakistan. The component of learning is marketing information systems, or MIS. Our understanding of this component is going to be in continuation of what we have learned about marketing research. In other words, the basic objective of marketing research that we know is to establish certain findings and elevate our confidence to make certain good decisions. With the way we understand our business, we understand the environment. Yet, we carry out certain market research studies because we're not absolutely sure about how things may look like at the once we have the established findings. And the fact is, because once we have carried out marketing research, the chances are, our findings may look a little different from what we earlier had assumed, or what really was the hypothesis before we carried out the market research study. Experts are of the view that the nonprofit sector, being cash-strapped most of the times, is not in a position to carry out marketing research studies every time a situation warrants that kind of a study. So in other words, we have to have certain means because the way we can generate accurate information that must lay the ground for us to make good decisions. And that ground could be laid by looking into a few areas that we call marketing information systems. First of all, we have to develop the understanding about what information systems are. Basically, it is collection of information and the storing of information, and then analyzing the same information so that it could be disseminated among all those managers who are supposed to make or who are responsible to make important, vital, strategic decisions for the program that you are to execute. Experts say that the information systems should be such that good information should automatically feed into the system, thereby providing to you with the platform that you need to make decisions. And in other words, it has to be kind of a routine effort, some kind of a set procedural mechanism, whereby you come up with the right most information on daily basis and then weekly basis and then monthly basis. The idea is to generate and then analyze information. Before I proceed with the four sub-systems that form the overall marketing information systems, let me talk about the five generalized areas that are addressed to the bio-information systems in any environment. May that be a commercial environment, meaning the private sector, or may that be non-profits? Information systems could basically deal with things like rather data on customers. In the context of non-profits, we can say that we need to look into our customers if they happen to be the ones to buy our products or services or any commission that we are out to sell or out to accomplish. So we need to develop data about the customers, activists, the volunteers, and so on and so forth. The second area of the data generation is the operations. If the non-profit happens to be into some kind of operations, for example, you are into the food bank or nursing home or an organization that is helping people on the medication to control different elements, you are supposed to have complete data on the nature of operations that you are undertaking. I'll talk on this a little more for the help of examples in a moment. The third area that requires us to generate data is on employees. And when I talk about employees, it is employees anywhere, meaning the commercial sector or the nonprofit sector. In the nonprofit sector, along with employees, we need to generate data on activists and volunteers again. And then the fourth area is about suppliers. And in the nonprofit context, it has to be not just the suppliers who are supplying different products or offering us different services or helping us with some vital information, because they happen to be a great source of information provision to the nonprofit that we are operating. We need to also generate information on our partners if we happen to be in a cost marketing relationship. We need to generate data and information on any allied parties that are into partnership with the nonprofit. And the fifth area with which information systems deal is that of financial data. We know without financial data, no company or no organization, commercial or nonprofit, is going to find out where it really stands. Therefore, we need to carry out an exercise of generating this data on daily basis. With this understanding of the five major areas with which information systems deal, we need to ask ourselves certain questions. Before we get into developing the understanding for the subsystems that form the overall marketing information systems. And that understanding can be developed by asking ourselves certain questions like, what information we need in order to make the decisions that we need to make. So in other words, first of all, we have to be very clear about the decisions that we need to make on daily basis. And then we have to zero in on the content of the information that we need to generate. The next question you may ask yourself in this context is, do you really have that information or not? If you have that information in what form it comes, it has to be institutionalized by developing certain procedures whereby this information automatically feeds into the system. And that's what I said to begin with that we have to have a system whereby information generated automatically feeds into it and becomes a bigger database for us to later analyze that information and then disseminate it. So the next question that we may ask ourselves is, what is it that is going to bring in all the information that we desire? The meaning all that portion of the information that is lacking in case we think we do not have complete information or in case we might think to ourselves that we need to improve that information because we want to make even better decisions. And then we look into the possibility of looking into certain publications, the magazines, journals. We also consider the possibility of attending certain seminars whereby we can generate information for the future. Or we also may look into the possibility of putting together a research design to carry out a comprehensive quantitative research if that is something which is going to help us and if that is something which is absolutely essential and inevitable. We might be content with getting out a small focus of the group study whereby we can establish what we really want to achieve in terms of generating information for the overall system. If you think that the focus group is not good enough, we might as well get into detailed interviews because that's one of the shortcomings where the focus groups that we eventually may have to get into detailed interviews are the simple reason that in many instances the respondents generally are not willing to come up with very accurate and honest answers. They go by the mentality of the overall group and like to at times give responses that may please the moderator at that particular point in time. And therefore if we think that we need to carry out the detailed interviews, we might as well consider that option so that our information base can be as accurate as possible and as comprehensive as possible in order to make the decisions that we need to make on daily basis. For, do not forget this thing, making good decisions and that we need to make decisions every now and then. Once we are clear about all the tools that we need to have to put together all the design information, we can be content with the information content, required for analysis and then executing our programs with certain controls. And once we are satisfied that we are in a position to control our programs and implement those programs to achieve the mission, I think the organization is all set about the information systems, which it can claim are good enough for them to move forward, but they should never claim that they have the best of information systems. Now, coming to the subsystems that form the overall system. The one is the internal reporting system. The second one is the market intelligence system. The third one is marketing research. So in other words, the marketing research happens to be one of the subsets or one of the subsystems of the overall marketing information systems. And that is where I would like to point out that we need to take a broader viewpoint that goes beyond marketing research for us to decide which subset of the overall information systems is the one that we need at a particular point in time. And the fourth one is what they call the marketing analytics. That subsystem, as the terminology suggests, is all about analyzing the information that we have put together through interviews, through the different reports that we generate every day, or through quantitative marketing research, that whatever is the source of information that takes the backseat. But once we start analyzing that information for us to make the decisions that we need to make. Another important thing about the MIS is that it does not take place in isolation. What I mean is we cannot operate within a silo which is the organization. It has to have a relationship with the external environment because we're dealing with constituents of the different forms and nature. We are dealing with different kinds of publics, input publics, then partner publics, consuming publics. We are dealing with the different segments of the external environment which is economic environment, the social cultural environment, regulatory environment, legal, and all other subsets of the environments to which you know very well affect what the organization is doing. We have learned that particular segment, I think, by a total clarity, and therefore it goes without saying that the external environment and all the factors that govern the external environment do have a direct bearing on the subsystems that operate within the overall marketing information systems. It is an ongoing iterative process that keeps the two environments interactive all the time and because of which we are in a position to execute our programs. And during execution, while we exercise controls, we again interact with the external environment which takes us back into the internal environment and it becomes kind of an iterative process which I'm going to show you in a while with the help of a graphical illustration. The fact remains that external environment into the internal environment which consists of four subsystems and then out into the environment to execute our programs. Let us talk about the first subsystem which is all about internal reporting. I think it goes without saying that we generate so many different kinds of reports that while we carry out our operations. We talked about the five major areas, information systems, the basic that we deal with and this is one thing that must take precedence over anything else. Whatever we do within the organization has got to be recorded and recorded as per a certain prescribed procedure and that is where the importance of different manuals come in. You have learned things like the purchasing manual, the accounting manual, the HR manual and with all these manuals which prescribe certain systems and procedures as to who's responsible to do what whether you carry out your activities in terms of the daily operations and then develop those daily reports. With the help of those reports could you generate information that you of course desire and you collect that information on weekly basis and then monthly basis and so on and so forth. The fact is that you need to have complete information and whatever information you have for up to the minute moment that you have updated database for the past the meaning the time that already has lapsed. With these reports that you can look into the things like the number of the food packets that you have distributed in one particular day to different kinds of households and when I talk about different kinds of households you have to classify which households are the ones that get food packets free of cost and which are the ones that get food packets at a subsidized price. Well, there's a classification of something being totally free and something that costs although in a subsidized manner. The fact remains you have two different segments and you have two different treatments of the record. You need to have complete financials in relation to what is being given away. Totally free of cost and what is it that is costing you and you are subsidizing that cost with the help of donations or with the help of the other supports in kind from the different constituents. So whatever is the case information that is generated has to be recorded in a systematic manner. Same as the case if you happen to be in the business of nursing home you have to be very quick on generating complete information about who's helping you with what kind of support. If restaurants, clubs and hotels are helping you with certain expertise you have to put that into a very structured and formal form so that that becomes your knowledge cash and you can draw on that whenever need be. And that is something which can be a substitute of the marketing research because you have access to some information which is valid, which is authentic and which is a matter of fact and therefore this is kind of an information which must take precedence over anything else. The point here is that any information that is generated by undertaking any dimension of the operation you happen to be a part of has to be recorded. The next subsystem is known as the market intelligence systems and as the terminology suggests it is about generating information from the marketplace for future. It is not about the past whether whatever has happened in the past is recorded in terms of internal reporting system that I just talked about and this is something which deals with the external environment and poses the great challenge for the marketing people to develop an information base which is up to date in terms of trends and developments that are taking place in the market and that may affect our future decisions. In order to generate intelligence the marketing people need to maintain a continual contact with the different constituents who are to be integrated in terms of being on the same page for the information desired by the organization. Of course these constituents are the ones who are important stakeholders and they should be taken into confidence for you to face a certain strategic situation in future and the information that you need from them has to come from them in a forthright manner. You also look into publications and all those secondary research materials that are available in libraries or on the internet so that you can attain a level of preparedness to deal with the future situations. The idea here is to be prepared for the certain eventualities which may look into your eyes in times to come. Experts also suggest that nonprofits send their managers to different seminars even if they take place in foreign countries because that is a great learning ground for managers to look into developments that are taking place elsewhere in the world and the impact of those developments on their own organizations back home. The great question here is what happens if you have developed information through the market intelligence systems? Well the answer lies in having somebody or having a small team that can put that information or intelligence into a proper perspective. All that intelligence has to be translated into the very well structured kind of information which can be helpful for decision making. Things that may not be very relevant or that ought to be omitted but all those developments that may affect our movement in terms of achievement of the mission have got to be recorded and we have to have smart managers who can give that information the right perspective so that whenever we need to have access to that information we know what we are looking into and what is it that is applicable to our situation. The third system is what we already know and that is the marketing research system. Here one thing I would like to point out is that the marketing research although being an expensive activity may not leave us in totality. So in other words there are situations in which we have to count on the marketing research. We have to go back to marketing research and carry out some level of research whether qualitative or quantitative because there are situations which aren't to be established in absolute certainty only through the research findings. I am not saying that research findings will tell us what those situations are they will certainly lay a very solid ground for us to move forward and to move with a lot of confidence towards the certainty that I referred to. Here I may give you the example of the need to know what exactly should be the position of the company in the minds of your customers so you need to carry out some kind of marketing research through maybe focus group. You need to know whether there is a need for repositioning the organization or what are the motivating factors for donors to donate towards your cause. What are the factors responsible for causing a shift in their preference for some other nonprofit organization to your disfavor. You know that the shifts are taking place and the external environment is pointing that out in a very vivid form and therefore you need to undertake certain collective measures and you decide to carry out research to first establish what really are the motivations on part of the donors who have been so active toward our cause and what is it that is making them drifting apart from our cause. So these are the kind of situations in which we need to carry out marketing research and we cannot really count on the past experience or in other words all the information that we have been collecting by way of daily reports or by way of market intelligence from time to time. The need of our is that we carry out market research and establish for ourselves what exactly are the parameters that we are looking for so that we can base our movement on that. Research is extremely vital because we do not really want to base our decisions on casual observations. The fact is that findings tell us that we had a complete misconception of the situation before we started getting into the market research. I would like to take you back to the example that I talked about in one of the previous components the example of druggies. Why is it that people take to drugs? It is not because they really want to be in a highly ecstatic situation where they feel they are kind of flying and they want to be totally cut off from the rest of the world. The actual, the motivating factor is not that ecstasy it really is an escape from the troubled family life. Now this factor of troubled family life is the one that we have established through research. This is what I'm trying to establish that until the time that we carry out marketing research because we do not know exactly the motivations behind a certain behavior. And in order to pinpoint why that behavior is taking place the way it does that we need to carry out marketing research. And the ones that we have carried out this marketing research in particular I think it leads us into a very interesting conclusion and that is that we need to deal with two different segments of the market. I will not leave it to your imagination and I would rather like to talk about those very explicitly. The one is the drugies themselves because you as a non-profit organization have to do something about their rehabilitation and to bring them back into the mainstream of sane society. So to say, you have to improve their welfare by putting a stop to that behavior which is causing that addiction. And the next segment that you are going to have to deal with is the families or the family members that you need to talk with very seriously about doing something so that other members of the family do not follow in the footsteps of drugies. So with one particular program that you are approaching two different segments and you are going to position that program differently for those two different segments just try to understand the implications of the results or the findings of the marketing research which translate into having two different strategies in order to deal with two different segments. I would like to talk about this particular factor more when I talk about the positioning concept in the context of non-profits of course, so much for the time being. With the help of marketing research we also need to carry out and establish certain causal relationships like I talked about in the example of drugies. Let me give you another example so that the concepts can become very clear in our minds in a proper non-profit context. Otherwise I do have this feeling that the new people fully understand what segmentation is, what market research is and what is the importance of having the right strategy for the right segment but still I would like to talk about examples from the non-profit world so that we can be on the same wavelength in terms of our understanding of the non-profit sector. Back to the example you are a part of a non-profit that helps people with medication on keeping some serious ailments away. For example, the blood pressure meaning high blood pressure and diabetes. You are advocating the need to be very regular in your habit to take those medicines so that you can keep the possibility of being struck with that eventuality in time to come. You may like to carry out marketing research in order to develop certain causal relationships as to what is it or what are the features of different personalities that make people very habitual to regularly take that medicine and what are the factors that may not make them very regular and habitual in following what has been prescribed by the non-profit. You may find out to your utter interest that the people who are very regular in taking that medicine are not the ones who happen to be in older age brackets with the meaning who have certain specific demographic features. Rather, it can be an outcome of a traumatic experience on part of people who ended up in a hospital with the blood pressure problem or high diabetes that caused some other problems. They were taken to the hospital where they understood the importance of taking those medicines they were not taking and after that episode they became very habitual and regular. This is a finding or a revelation which has come to you with the help of marketing research because before that you had just suppositions and your casual observations. Now you have exact findings and based on these findings you can come up with the rightmost strategies in order to grapple and in order to come to grips with that particular situation. If not that particular situation in which you may be handling very well you may need that information to come to grips with upcoming situations because you are equipped with very authentic findings and you can make the people aware of what may happen if they do not follow the program what is being described and if they do not change their behavior and if they do not seriously involve themselves into the exchange which you are trying to sell to them. That is the importance of research for the non-profits. The fourth subsystem of the overall MIS is market analytic system. All the information that we have collected either through internal reporting system or through the market intelligence system or marketing research that we have to transform all that into better insights because better insights help us make better decisions and the analysis that we carry out within the organizations could be simple to sophisticated. Simple analysis could be working on the spreadsheets and coming up with certain conclusions that you need to make decisions and sophisticated ones could come about with the help of application of some sophisticated statistical supports. So whatever is the situation depending on the amount of resources that you have at your disposal you make the decision as to how to analyze the information. But the fact is until the time that information is analyzed which basically has been a combination of the external environment and rather the interplay of external environment and the internal environment there is no way that you are in a position to make good decisions for your program. Let me now take you to the graphical illustration which encapsulates the whole concept that I have talked about. Here as you can see from this slide right in the middle of the illustration which is a big box that we have four systems sitting side by side with each other and this is where I would like to point out once again it is not really important that all these four subsystems that take place are developed themselves at the same time. It could be something which develops one after the other or maybe at certain points of time these subsystems are developing simultaneously. The fact is there is no hard and fast rule about it whether you should be developing all of these simultaneously side by side or one after the other. It basically is a function of time and it is a time-consuming effort with the passage of time that you are in a position to improve your internal reporting and the market intelligence systems and the marketing research programs. Although I've said earlier that these programs are not followed in response to each and every situation which is or which rather qualifies for conducting marketing research this is something that we have to be very discreet about and very discriminating about because of shortage of funds get the most of the time and then we have an analytical marketing system which is all about analyzing the collected data and information. But important arms of this major internal silo is what you see on the left-hand side and the right-hand side of this graphical illustration. On the left-hand side we have constituents in the marketing channels which play their role in generating some vital information that goes into the MIS then we have publics of different kinds we have macro and environmental factors and then on the right-hand side we have planning, execution and control because the outcome of the MIS is what we execute the meaning execution of our programs and we of course plan for those programs and that is why the planning shows itself as an important factor but the fact is that execution and control are the two major things that we need to do and as you can see this outcome goes back into the external environment and then over again into the internal one and this makes the whole thing an iterative of the process which goes on all the time. This component is on segmentation We as marketing people know that any marketing effort is a function of the application of segmentation theory the reason being that the whole market cannot be just the one monolithic piece and the marketing people have got to divide the market into different groups calling them segments because they're the different groups of customers or people are going to show different behaviors they manifest different features and those features or those behaviors that have similarities they form themselves into segments and the one segment therefore has to be composed of all those customers who have so many things in common what those things are we are going to talk about that as well but the fact remains that the market has to be divided into segments and we've got to understand what should be the characteristics of the different segments in other words before we start dividing the whole market into different groups because we develop profiles and every segment that we talk about or we need to approach in the marketplace because we need to define the profile of that particular segment how do we do that and what are the parameters that need to be taken into consideration before we can really define our segments well first of all we've got to make sure that this segment has got to be mutually exclusive this feature of mutual exclusivity defines that there are no overlaps among different segments and they are absolutely separable if I take you back to the example of the food bank we know that we're dealing with two different segments or rather three different segments the one segment is all about free meals which are being dispersed on a daily basis and the other one is meals for congregations the two segments need two different marketing management treatments and they have their own financial implications similarly we know that food that is being dispersed at subsidized price is yet another segment because we're dealing with families that are in a position to pay to a certain extent and the remaining portion is being subsidized by the organization and therefore we are dealing here because we're at third segment in total differential from the other two this is what really explains the mutual exclusivity the second characteristic of segmentation is exhaustiveness but the meaning that we've got to undertake an exercise which exhausts the whole market into different well defined segments leaving no portion of the market as a group which cannot be classified or which cannot be defined as any particular segment so therefore if the total market consists of with 100 people that we've got to see to it that all those 100 people are divided into different groups in practicality it is not as arithmetical as I've said but my point is that we should not leave any portions of the market as unattended segments and have to make sure that everybody is accounted for let me take you back to the example of nursing home where we are in the process of determining as to who our target market is and we're dealing with different segments of the market that are providing us with some vital information on the possible qualification of the target market we have activists and we have volunteers and maybe another segment who are all helping us with this vital information and we miss out on a segment which we may call of doctors who attend to the old age patients and chemists who sell those medicines that are acquired by the old age people all of a sudden we realize that this is a segment that really could be very helpful in pointing out where that population is and what are the kinds of treatments they are subjected to and we somehow missed out on this whereas this happens to be a very important segment here I would like to take you back to the instrument of market intelligence which should work automatically into the system in a way that it indicates a very important segment which can make the whole exercise very purposeful so this is what is meant by exhaustiveness the next feature of segmentation is the measureability which is all about defining the size of the market until the time that we know the number of addicts because we are going to deal with in terms of their rehabilitation and the size of the market which consists of their families that we cannot really make of a program that could be very effective and therefore what is the size of the market what are the motivations could be behind different behaviors demonstrated by the target market as well as any other related to the group that is associated with that particular segment our exercise of defining the segments is not really complete the next feature which the exercise of segmentation must carry is reachability and this perhaps is one of the most important features of the segmentation because this basically is a function of marketers ability to reach their target market if they cannot reach the target market there is no marketing at all and therefore we have to very carefully look into our ability of putting together integrated communication campaigns that connects us with the target market the next feature of segmentation is substantiality which basically refers to the largeness of a segment of customers or stakeholders or it may be based on the amount of consumption let me give you the example of the two different segments in terms of their largeness and also smallness which is the opposite you are working for the fight for cancer and you may find out that a lot of many people are willing to donate to what that costs because they think it is a very noble cause and the people who have been inflicted by this serious ailment have got to be helped and you end up realizing that it is not just the one segment rather it is going to be so many different segments like there could be different sorts of individuals and there could also be the corporate entities who are willing to help to work this particular cause and you think you are going to have more than one segment and every segment is going to be a large segment conversely you have a situation in which you are trying to rehabilitate the drug addicts meaning the druggies but you end up not attracting too many donors because they think that this is a misery which is caused by the druggies themselves and therefore you may realize that the segment of donors you are going to deal with is going to be rather small because you have to think of something more creative in order to keep the interest of the organization and the purpose of the organization alive because so that you can work on that cause but the segment remains small or it may remain small but what is it that you need to do in order to broaden the base of the segment is going to be the study of further components which we shall be getting into from time to time but the important point here is that a large segment consisting of either customers or donors or any form of influencers or constituents is a better segment than a small segment because you achieve economies of scale while you carry out your campaigns and your strategic outlook is more firm more concrete and more insightful and therefore a large segment definitely is better than a segment which is not large or rather small. The last feature of the segmentation is that of differential responsiveness. This feature is also as important as the feature of reachability. So in other words, even if we have all the features present in terms of dividing the whole market into different segments and we know that we can measure the segment we know that we can have a substantial segment in terms of this particular cause and that we can be very good at exhausting all the options to define different kinds of segments until the time that we are in a position to reach the segment and then evoke different responses from those segments we are not really into the business of segmentation of that matter, good marketing management. So in other words, differential responsiveness defines different responses that are given by different market segments. If two segments come up with responses that are very similar, it means something has gone wrong with the exercise of segmentation and we need to create conditions whereby we end up defining segments that elicit different responses so that we treat different segments with different marketing strategies by putting together different variables of marketing mix in different intensity.