Information & Management, 28(1), 1995, 13-31
1
Marketing Information Systems in the Top U.S. Companies:
A Longitudinal Analysis
Eldon Y. Li
Graduate Institute of Information Management, National Chung Cheng University
160, San-Hsing, Ming-Hsiung, Chia-Yi 621, Taiwan, R.O.C.
and
College of Business, California Polytechnic State University
San Luis Obispo, California 93407
Abstract
Marketing information system (MKIS) has been the nerve center of a marketing organization in corporate
America. To measure its strengths and weaknesses, one may use its overall status in industries as a yardstick. The
objective of this effort was to determine the overall status of MKISs in top U.S. companies. In order to identify the
progress of MKISs, the findings of this study are compared to those of a similar study made in 1985. Apparently,
MKISs today are more sophisticated than before and that MKIS usage has increased. However, many companies
are not utilizing the latest information technologies and many marketing managers are not satisfied with their
MKISs. The study further discusses possible reasons for the progress and recommends several actions through
which the companies may shape the future of their MKISs.
Keywords: Marketing information systems, marketing functions, marketing activities, marketing management,
computer usage, decision support, information technologies, competitive advantage
1. Introduction
The marketing function of a business entity
includes many activities. It is "the process of
planning and executing the conception, pricing,
promotion, and distribution of ideas, goods, and
services to create exchanges that satisfy individual
and organizational objectives." [3] In a nutshell, its
main purpose is to satisfy customers' wants and
needs at a profit [20]. A successful organization
must integrate its functional elements into a
smoothly operating unit. In marketing, this
integration is best achieved through the satisfaction
of customer's objectives. Firms that are unable to
outperform their competitors in satisfying the
customers are destined to fail. To be able to stay in
business, a company must gather and analyze
pertinent information to plan for its marketing
actions.
In the 1960's, an MKIS was merely an
outgrowth of marketing research. As competition
became increasingly intense, the gathering and
management of marketing information became
important. The data needed to make informed
decisions exceeded the physical processing
capabilities of most firms. More and more
businesses began to establish MKISs: typically, a
marketing manager uses them to learn about the
needs of the marketplace for new or improved
products and services. The MKIS makes it possible
for a firm to react rapidly to customer needs. Once
the product or service has been provided, the
marketing manager may use the MKIS to determine
how well the needs are being satisfied. The MKIS
provides managers with marketplace information
and this may be used to modify, improve, or delete
products and services. If a company does not have
an MKIS, its efficiency and effectiveness are likely
to be severely degraded, weakening its competitive
edge. Therefore, to be able to compete today,
business organizations must have an MKIS.
To gain a perspective of MKISs in U.S.
companies, researchers have conducted survey
studies. The first was reported by Boone and Kurtz
[6] in 1971; it used Fortune 500 companies as its
target group. The study was replicated by McLeod
and Rogers [21] in 1982; they compared the results
and provided important insight into the progress of
MKIS in Fortune 500 type companies.
McLeod and Rogers [22] later conducted a
survey of some of the companies listed in the Fortune
1000 directory. They reported the MKIS status of
these companies based on information from 75
respondents with MKISs in 1985. A few other
studies have been reported since 1980. Berry [5] and
Mentzer, et al. [23] surveyed the use of
microcomputers in the MKIS; Higby and Farah [10]
reported the use of decision support and expert
systems; and Li, McLeod, and Rogers [15] updated
the status and progress of MKISs in some Fortune
500 companies. However, none of these studies has
replicated the 1985 study to determine the progress
of MKISs.top 1000 U.S. companies. The purpose of
this study is to do so by surveying this group of
companies and comparing the results with those of
1985. The significant differences between these two
Information & Management, 28(1), 1995, 13-31
2
studies may shed some light on the future of MKISs
in these companies.
2. The MKIS Model for This Study
In retrospect, the very first descriptive
model of MKIS proposed almost thirty years ago
may be attributed to Philip Kotler [14]. Since then,
many more models [1, 2, 7, 9, 13, 15, 16, 17, 18, 21,
22, 24, 25] have been proposed, however there is
none that is widely accepted in industry. In fact, an
MKIS is like a decision support system (DSS): it is
generally unique to the company it serves.
For the purpose of this study, we adapted
the MKIS model of McLeod and Rogers as shown in
Figure 1. In this, there are two general subsystems
which are fairly consistent with the others: they are
the input and output subsystems. The input
subsystems are internal accounting, marketing
intelligence, and marketing research. They gather
internal and environmental data for the databases.
The output subsystems utilize the databases to
produce marketing management information.
Marketing managers will not only receive routine
reports, they can also inquire interactively to produce
ad hoc reports. Through this information, marketing
managers can make their decisions on pricing,
products, advertising/promotion, distribution, and
packaging, under the constraints imposed by
economics, the government, competitors, and the
customer needs. This process should be integrated
into organizational strategies and decision-making
processes to support all levels of marketing functions
– planning, organizing, staffing, directing, and
controlling.
3. Research Method
3.1. Subjects
A questionnaire concerning the use of MKIS with
instruction for completing it was mailed to the
marketing executives of the top 1000 firms listed in
a recent issue of Business Week. This list is
equivalent to the Fortune 1000 listing which was
discontinued in 1983. Eventually, one hundred and
thirty-eight replies (13.8%) were returned. This
response rate is typical of an unsolicited mail survey.
Of all the respondents, 81 (59%) were from productrelated
companies and the rest from service-related
ones. Their annual sales ranged from $20 million to
$30 billion and the number of employees ranged
from 90 to 85,000. Among them, 104 (75%)
indicated their firms have some form of MKIS and
were able to complete the entire questionnaire.
Model
Bases
Data
Bases
Internal
A
ccounting
MarketingResearch
MarketingIntelligence
Governments
Customers
Potential
Customers
Internal
Data
National
Economy
Competitors
Data and
Information
Sources
Product
Price
Place
Promotion
Plan
Organize
Staff
Control
Direct
DBMS MBMS
Information
Inquiry
User / System
Interface
Marketing Management Activities
Decisions
Noncomputerized Systems
Top
M
anagement
M
iddle
M
anagement
Operating
M
anagement
Figure 1. Framework of a Marketing Information System
Data Models
Information & Management, 28(1), 1995, 13-31
3
Table 1 and Table 2 show the distributions
of the types and size of the companies having an
MKIS. The profile of the entire sample (138
companies) seems to be representative of Business
Week 1000 firms. A chi-square test was conducted
to identify significant difference in each distribution
between the companies having MKISs and those
having no MKISs. No significant difference was
found in any distribution, indicating that the
companies having MKISs should be representative of
the entire sample.
3.2. Questionnaire
In order to facilitate comparison, the author
adapted the questionnaire used by McLeod and
Rogers with some additions. The additional
questions were developed after considering the
advances of information technology and the trend
towards using CIS as a competitive weapon [4, 8, 11,
12, 19, 26, 27] in the past few years. The final
questionnaire is shown in the Appendix.
3.3. Procedure
The questionnaire was pretested twice to
determine its format and wording. The final
questionnaire was sent to all 1000 executives. Two
months later, a second mailing was sent to nonrespondents.
Of the 104 who were able to complete
the entire questionnaire, 58 were in the first-wave
mailing. The samples allow us to examine the
existence of late-response bias. A series of chisquare
and 't' tests were conducted between the two
samples. The first was for questions with a nominal
or ordinal scale and the second for questions with a
ratio (percentage) scale. No significant differences
were found on respondents' perceptions of MKISs.
Since there is no evidence of late-response bias, the
samples were merged for further analyses.
4. Results and Discussion
Of the 138 respondents, 25% said that they
did not have a corporate MKIS. This percentage is
fairly consistent with that of 1985 survey (24%).
This is somewhat difficult to explain. It seems that
any business should process some marketing-related
information (e.g., customer addresses, sales orders,
merchandise returns, etc.). As McLeod and Rogers
suggested, the perceived MKIS support might be
such a low level that it did not seem to exist which
resulted in losing its identity. Alternatively,
managers might rely on external MKIS services for
marketing information. For the purpose of this
study, the companies having no MKISs are excluded
from further analyses.
4.1. CIS and Marketing Plans
The majority (81%) of the companies that
stated they had MKISs also had company-wide
computer information systems (CISs). Of the
companies with CISs, two thirds had formal, written
company-wide CIS plans. Fifty-nine percent said
that their CIS plans were influenced by marketing
strategies. In addition, most (89%) said they had
formal, written marketing plans. However, only
53% of these were influenced by the status of
information-related resources in the company.
4.2. Hardware Usage
An overwhelming number (95%) of
respondents indicated that their MKISs were
computer assisted; for the breakdown, see Figure 2.
Interestingly enough, little use is made of
supercomputers.
4.3. Software Usage
Figure 3 shows that there were three main
categories of corporate-wide software (i.e., decision
modeling and spreadsheets, conventional
programming, and database management).
Apparently, expert systems and artificial intelligence
Figure 2. Computer Hardware Usage in MKIS
50.1
25
14.2
10
0.8
0
10
20
30
40
50
60
70
80
90
100
M
ainfram
e
com
putersPersonalcom
puters
M
inicom
puters
M
ulti-userm
icros
Supercom
puters
Type of Computer Hardware
PercentofHardwareUsage
1993 (N = 94)
Figure 3. Computer Software Usage in MKIS
26.1 26
20.5
12.7
8
0.3 0.2
6.2
0
10
20
30
40
50
60
70
80
90
100
M
odeling/Spreadsheet
C
onventional/3rd
G
.L.
D
atabase
M
anagem
ent
4th
G
.L./Integrated
StatisticalAnalysis
A.I./Logic
Program
m
ing
ExpertSystem
Shell
O
ther
Type of Computer Software
PercentofSoftwareUsage
1993 (N = 72)
Information & Management, 28(1), 1995, 13-31
4
languages are not meeting their assumed demand.
4.4. Frequency of Computer Usage
Most of the respondents (93%) were able to
access personal computers (PCs) or terminals in
their job functions. This is much greater than 67%
of 1985. Many (73%) used PCs or terminals on a
daily basis (up from 53% in 1985). Figure 4
contrasts the frequencies of computer usage between
1985 and 1993. There were more daily or weekly
users and less monthly or sporadic users in 1993
than in 1985 (significant at p < 0.0001 based on the
chi-square test).
4.5. Purposes of Computer Usage
As in 1985, the major use of computers is to
retrieve data (see Figure 5).
When asked what they first considered
useful in their marketing information systems, 31%
of the results were "reports," with 23% "different
managers' information needs," and 18% "data/file
retrieval." However, there are significant differences
(p < 0.01) between 1993 and 1985 based on the chisquare
test. "Reports" and "data retrieval" in 1993
were up from 1985's. This is consistent with the
major purpose of computer usage in 1993 –
retrieving data. On the contrary, "information
needs" were down. Obviously marketing managers
focus on their means (the information) and not their
ends (the needs).
4.6. Communications of Information
Communications between branches and
their main office are of vital importance to the
success of a marketing organization. Traditionally,
these communications were through the phone (or
voice mail). In 1993, other communication channels
included electronic mail (68%) and electronic
bulletin boards (26%). The use of computer
conferences (9%) and video conferences (10%) was
limited. Surprisingly none of the firms utilized any
hypertext or hypermedia technology for their interbranch
conferences. Moreover, many (78%,
78÷103) of these firms routinely routed marketing
intelligence information to those managers with a
need to know.
4.7. Sources of Information
Internal accounting was regarded as the
most important source of MKIS information. It
received 65% of the 95 top-ranking responses (see
Figure 6). Table 3 shows the change in ranks of
marketing intelligence (significant at p < 0.05 based
on the Mann-Whitney test). Also, the rank
distributions in 1993 between marketing-intelligence
and marketing-research information are quite
similar. This is a good sign for customers, since
marketing research is primarily designed to identify
market demands and preferences. This seems to
confirm the reviving interest of corporate America in
customer-driven programs.
4.8. Information Content
Figure 7 shows the environmental data
maintained in the MIKS. Furthermore, it shows that
most (93%) customer data were computerized and
Figure 5. Purposes of Computer Usage
87
56
49
44
40
88
66 63
45
28
14
78
60
41
0
10
20
30
40
50
60
70
80
90
100
R
etrieving
D
ataStoring
D
ata
Processing
D
ata
Transm
itting
R
eports
D
ecision
Sim
ulation
C
oding
Program
s
Producing
R
eports
R
esponding
to
Inquiry
D
isplaying
G
raphics
Purposes of Computer Usage
PercentofComputerUsers
1985 (N = 50)
1993 (N = 88)
N.A.
N.A.
N.A.
N.A.
Figure 6. Sources of Information in MKIS
59
28
13
65
24
21
0
10
20
30
40
50
60
70
80
90
100
Internal Accounting Marketing Intelligence Marketing Research
Sources of Information
1985 (N = 76)
1993 (N = 95)
PercentofTop-RankingResponses
Figure 4. Frequency of Computer Usage
53
11
20
16
73
15
1
11
0
10
20
30
40
50
60
70
80
90
100
Daily Weekly Monthly Less Than
Monthly
Frequency of Computer Usage
PercentofComputerUsers
1985 (N = 50)
1993 (N = 96)
Information & Management, 28(1), 1995, 13-31
5
that more prospect data (up by 10%) but less
national economy (down by 8%) were computerized
in 1993 than in 1985.
With regard to preprocessed information,
such as sales forecasts, distribution trends, market
share, inventory statistics, etc., 70 of 100 responding
companies made them available to managers on a
real time basis. Nearly half (49%) of the companies
had economic-trend estimates included in their
marketing forecasts. As for competitor information,
the status of 1993 is not much different than that of
1985 (see Figure 8). Many firms had been using
corporate annual reports (74%), sales call reports
(72%), purchased reports (71%), and clipping
service (54%) as the source of their competitor
information. Nonetheless, most was not
computerized.
4.9. Support for Marketing Management
As in 1985, 42% of the companies said that
their MKISs were mostly supporting middle-level
management (see Figure 9). However, more
companies thought that low-level management were
receiving more MKIS support than the top-level.
Table 4 shows the average ranks of 1993 from
middle to low and finally top. The distribution has
changed significantly.
Regarding management functions, Figure
10 shows that planning (50%) and controlling (31%)
were the two areas receiving the most support from
the MKIS. While planning was up, controlling was
down from 1985. Table 5 shows the average ranks
of 1993 in sequence: planning, controlling,
directing, organizing, and staffing. Also directing
and controlling have significantly changed their rank
distributions (at p < 0.001 and p < 0.05, respectively
under the Mann-Whitney test). This increased
support for planning activities has two implications:
on the positive side, MKIS had attracted more
marketing managers to use the system for planning,
but on the negative side, marketing managers may
have focused too much on planning and too little on
implementation and controls.
4.10. Support for Marketing-Mix Decisions
A marketing program typically involves
decisions on the marketing-mix ingredients:
product, price, place, and promotion. In 1985,
product-related decisions were receiving the most
MKIS support. In 1993, support for price-related
decisions took a small lead ahead of that for productrelated
ones (see Figure 11). The chi-square test
indicated that the change in top-ranking MKIS
support between the two years was significant at p <
0.05. Table 6 shows the average ranks of 1993 in
sequence were product, price, promotion, and place.
Also product and promotion related decisions have
significantly changed their rank distributions (at p <
0.01 and p < 0.05, respectively under the MannWhitney
test). Apparently, MKIS in 1993 was
Figure 7. Environmental Data Collected for MKIS
91
33
25 25
12
93
37 35
17
11
100
77
65
41
37
0
10
20
30
40
50
60
70
80
90
100
Customers Competitors Prospects Economy Governments
Type of Environmental Data
PercentofRespondents
1985: Computerized
1993: Computerized
1993: Collected
1985 (N = 75)
1993 (N = 104)
47
19
34
42
26
31
0
10
20
30
40
50
60
70
80
90
Middle Level Low Level Top Level
Management Level
1993 (N = 99)
Figure 9. MKIS Support for Marketing Management
PercentofTop-RankingResponses
39 40
19
1 1
50
11
6
2
31
0
10
20
30
40
50
60
70
80
90
100
Planning Controlling Directing Organizing Staffing
Functions of Marketing Management
1985 (N = 75)
1993 (N = 94)
Fig. 10. MKIS Support for Marketing Management Functions
PercentofTop-RankingResponses
Figure 8. Sources of Competitor Information
7
23
32
12
73
55 55
9
25 24
8
74 72 71
54
75
0
10
20
30
40
50
60
70
80
90
100
Corp. Annual
Reports
Sales Call Reports Purchased
Reports
Clipping Service
Sources of Information
PercentofRespondents
1985: Computerized
1985: Utilized
1993: Computerized
1993: Utilized
1985 (N = 75)
1993 (N = 104)
Information & Management, 28(1), 1995, 13-31
6
supporting marketing-mix decisions on a more
balanced basis than in 1985.
However, only 55% of the companies had
the descriptions of price-related decisions
computerized. To develop such databases is by no
means easy under old computer technology.
Fortunately, hypertext or hypermedia should make it
easier in the future.
4.11. Use of Decision Models
There are several decision models available
to a marketing manager. Most of them were
developed to aid in price and product decisions. In
1985, 58% of the managers used decision models to
compute their annual operating budgets, and 42%
used them to evaluate new products or formulate
pricing strategies. In 1993, this has flipped;
operating budgets went down and product evaluation
and pricing strategies each went up (see Figure 12).
Furthermore, the use of models had shown various
levels of increase in less-structured tasks such as
product deletion, advertising media selection,
salesperson assignment, and delivery routing. One
particular task, selection of advertising media, had
more than doubled in its use. On the contrary, the
well-structured tasks such as computing economic
order quantities, determining reorder points, and
approving customer credit had shown significant
decreases (p < 0.0001 under the chi-square test) in
model use. Figure 13 shows that the decision models
most likely to be computer-assisted are for
formulating pricing strategy, computing operating
budget, evaluating new products, and deleting
products.
4.12. Performance of MKIS
There were a diversity of MKISs among the
participating companies. When asked to define the
company's MKIS, thirty-seven (37%) managers
replied that it was "a group of subsystems – some
gather data and others process it. The data gathering
subsystems are marketing research, marketing
intelligence, and internal accounting. The
processing subsystems produce information about
product, price, distribution, and promotion."
The next most popular definition was given
by 23 managers who stated that the MKIS was "a
group of subsystems that gather information from the
environment and use it to help the manager answer
certain basic questions, such as What is out current
situation? Where do we want to be? What are the
constraints? and What action should we take?"
Fifteen managers felt that the MKIS was a
"data bank that stores data from the environment and
makes that data available to a set of computer
programs. The programs produce output that is
communicated to the manager on a display unit."
Only ten managers thought that the MKIS was "a
group of subsystems – each representing an area of
marketing activity – product, price, distribution
channels, and promotion. The subsystems help the
manager formulate and execute marketing
programs."
This wide divergence in MKIS definitions
indicates that there is no accepted industry standard.
The companies seem to be searching for efficiency
in their marketing organizations. It is obvious that
most of the companies have not found a system that
they believe is best. Only 32% were satisfied with
their existing MKISs and 16% were neutral on the
subject. However, 54% felt that their MKISs gave
Figure 13. Computer-Assisted Decision Models
43 42
32 30
22
17 15 14
9 9 8
0
10
20
30
40
50
60
70
80
90
100
Pricing
Strategy
O
perations
Budgeting
N
ew
ProductEvaluation
ProductD
eletion
Salesperson
Assignm
ent
Facility
Location
Econom
ic
O
rderQ
ty.
Ad.M
edia
Selection
R
outing
D
eliveries
Approving
C
redit
R
eorderPoint
Type of Decision Models
PercentofRespondents
1993 (N = 102)
Figure 12. Use of Decision Models
42 42
58
39
21 24 24
18
30
36 33
64
47 44
34
22
14
18
24
53
10
64
0
10
20
30
40
50
60
70
80
90
100
N
ew
ProductEvaluation
Pricing
Strategy
O
perations
Budgeting
ProductD
eletion
Ad.M
edia
Selection
Salesperson
Assignm
ent
Facility
Location
R
outing
D
eliveries
Econom
ic
O
rderQ
ty.
Approving
C
redit
R
eorderPoint
Type of Decision Models
PercentofRespondents
1985 (N = 75)
1993 (N = 102)
16
51
19
14
32
22
15
31
0
10
20
30
40
50
60
70
80
90
100
Price Product Promotion Place
Marketing-Mix Ingredients
1985 (N = 73)
1993 (N = 100)
Figure 11. MKIS Support for Marketing-Mix Ingredients
PercentofTop-RankingResponses
Information & Management, 28(1), 1995, 13-31
7
them some sort of competitive advantage. A crosstabulation
of satisfaction level by competitive
advantage (see Figure 14) showed that there was a
significant positive association between them (p <
0.0001 under the chi-square test).
5. Conclusions and Recommendations
Overall, the results of this study confirm
mostly to the trends identified in 1985. The specific
patterns of MKIS usage includes:
(1) Computers are needed by marketing managers,
for retrieving data and then storing and
processing it.
(2) Internal accounting continues to be the most
important source of MKIS information while
the use of marketing intelligence and
marketing research as information sources are
more balanced.
(3) Most companies collect data about their
customers. Collection of data about
competitors and prospective customers is also
popular, but this is less computerized.
(4) The major users of MKIS are the middle-level
managers.
(5) Planning and controlling are still the
management functions using most MKIS
support.
(6) Price and product related decisions consume
most of the MKIS resources. However, support
for marketing-mix ingredients is likely to
become more balanced.
(7) Decision models are used mostly for product
and price decisions. Computer-assisted
decision models reflect this.
(8) Mini and microcomputers are now used as
much as mainframe computers.
(9) The computer software being used in an MKIS
includes modeling/spreadsheets, conventional/
third-generation programming languages, and
database management systems. Statistical
analysis software, logic programming
languages, and expert system shells are not
used very much.
Although many of the surveyed companies
have sophisticated CISs and MKISs, most of them
are limited in nature. There seems to be a deficiency
in computerizing information about governments,
economy, competitors, and prospects across
companies. Such information cannot be used
effectively if it is not computerized. Nor can it be
communicated between branches and the main office
efficiently.
In today's global marketplace, the success of
a company does not depend on how much the
company uses latest technologies but on how well it
can gather, manage, and utilize pertinent
information and integrated it into the marketing
managers' decision making processes. To achieve a
successful MKIS, implementing new information
technologies is not enough. It is necessary to focus
more on the information needs of marketing
managers, to balance the MKIS support for all
management functions, and to integrate business
plans with CIS plans in order to exploit the available
information resources. This will probably create a
competitive advantage for the company and, in turn,
increase the level of satisfaction perceived by the
managers.
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[7] Brien, R.H., and Stafford, J.E. "Marketing
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11 11
18
1
13
18
6
11
3
7
1
1
0
5
10
15
20
25
30
35
1
=
Very
D
issatisfied
2
=
M
oderately
D
issat.
3
=
Som
ew
hatD
issatis.
4
=
N
eutral
5
=
Som
ew
hatSatisfied
6
=
M
oderately
Satisf.
7
=
Very
Satisfied
Categories of Satisfaction Scale
PercentofRespondents
Competitive Edge: No
Competitive Edge: Yes
Grand Mean: 3.65, Grand Standard Deviation: 1.473, Grand Median: 3
Figure 14. Satisfaction With Marketing Information Systems
Information & Management, 28(1), 1995, 13-31
8
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Business Review, Vol. 45, May-June 1967, pp.
134-142.
[10]Higby, M.A., and Farah, B.N. "The Status of
Marketing Information Systems, Decision
Support Systems and Expert Systems in the
Marketing Function of U.S. Firms," Information
& Management, Vol. 20, No. 1, January 1991,
pp. 29-35.
[11]Ives, B., and Learmonth, G.P. "The Information
System As a Competitive Weapon,"
Communications of the ACM, Vol. 27, No. 12,
December 1984, pp. 1193-1201.
[12]Johnston, H.R., and Vitale, M.R. "Creating
Competitive Advantage with Interorganizational
Information Systems," MIS Quarterly, Vol. 12,
No. 2, June 1988, pp. 153-165.
[13]King, W.R., and Cleland, D.I. "Environmental
Information Systems for Strategic Marketing
Planning," Journal of Marketing, Vol. 38,
October 1974, pp. 35-40.
[14]Kotler, P. "A Design for the Firm's Marketing
Nerve Center," Business Horizons, Vol. 9, Fall
1966, pp. 63-74.
[15]Li, E.Y., McLeod, R., Jr., and Rogers, J.C.
"Marketing Information Systems in the Fortune
500 Companies: Past, Present, and Future,"
Journal of Management Information Systems,
Vol. 10, No. 1, Summer 1993, pp. 165-192.
[16]Little, J.D.C., "BRANDAID: A Marketing Mix
Model, Part 1: Structure," Operations Research,
Vol. 23, No. 4, July-August 1975a, pp. 628-655.
[17]Little, J.D.C., "BRANDAID: A Marketing Mix
Model, Part 2: Implementation, Calibration, and
Case Study," Operations Research, Vol. 23, No.
4, July-August 1975b, pp. 656-673.
[18]Little, J.D.C. "Decision Support Systems for
Marketing Managers," Journal of Marketing,
Vol. 43, Summer 1979, pp. 9-26.
[19]McFarlan, F.W. "Information Technology
Changes the Way You Compete," Harvard
Business Review, Vol. 62, No. 3, May-June
1984, pp. 98-103.
[20]McLeod, R., Jr. Management Information
Systems: A Study of Computer-Based
Information Systems, 3rd edition, New York:
Macmillan, 1986.
[21]McLeod, R., Jr., and Rogers, J.C. "Marketing
Information Systems: Uses in the Fortune 500,"
California Management Review, Vol. 25, Fall
1982, pp. 106-118.
[22]McLeod, R., Jr., and Rogers, J.C. "Marketing
Information Systems: Their Current Status in
Fortune 1000 Companies," Journal of
Management Information Systems, Vol. 1,
Spring 1985, pp. 57-75.
[23]Mentzer, J.T., Schuster, C.P., and Roberts, D.J.
"Microcomputer Versus Mainframe Usage by
Marketing Professionals," Journal of the
Academy of Marketing Science, Vol. 15,
Summer 1987, pp. 1-9.
[24]Montgomery, D.B. Developing a Balanced
Marketing Information System, Cambridge,
Massachusetts: Marketing Science Institute,
1970.
[25]Montgomery, D.B., and Urban, G.L. "Marketing
Decision-Information Systems: An Emerging
View," Journal of Marketing Research, Vol. 7,
May 1970, pp. 226-234.
[26]Parsons, G.L. "Information Technology: A New
Competitive Weapon," Sloan Management
Review, Vol. 25, No. 1, Fall 1983, pp. 3-14.
[27]Porter, M.E., and Millar, V.C. "How
Information Gives You Competitive
Advantage," Harvard Business Review, Vol. 63,
July-August 1985, pp. 149-160.
Eldon Y. Li is Professor and Founding
Director of Graduate Institute of
Information Management at National
Chung Cheng University in Taiwan.
He is on leave from the College of
Business, California Polytechnic State
University, San Luis Obispo, where he
is a Professor and a former
Coordinator of MIS program. He
holds a bachelor degree from National Chengchi University in
Taiwan and M.S. and Ph.D. degrees from Texas Tech University.
He have received two "Best Paper" awards, one from the Quality
Data Processing journal in 1990 and the another from the ACME
Proceedings in 1991. He has provided consulting services to many
firms for a variety of software projects and served as a management
consultant to the clientele of the U.S. Small Business Administration.
He is a former software quality specialist at Bechtel Corporation
Information Services Division and a former visiting software scientist
at IBM Corporation. His current research interest lies in human
factors in information technology (IT), strategic IT planning,
software engineering, quality assurance, and information
management. He is a Certified Data Educator (CDE) and is Certified
in Production and Inventory Management (CPIM). Being a member
of ACM, ACME, IACIS, DSI, NACISPA, and TIMS, he have
published in Information & Management, Information Resources
Management Journal, Journal of Management Information
Systems, Journal of Systems Management, Quality Data
Processing, The Journal of Computer Information Systems, Group
& Organization Studies, Public Personnel Management, and
Simulation & Gaming. He currently serves as a member of the
editorial board for The Journal of Quality Assurance Institute.
Information & Management, 28(1), 1995, 13-31
9
Table 1. Industry Types of Participating Companies
Company has MKIS? % of
Type of Industry No Yes Row Total
Product-related Non-manufacturing Industries:
Metal mining 1 1 1.4%
Coal mining 0 1 0.7%
Oil and gas extraction 1 4 3.6%
Mining & quarrying of nonmetallic minerals, except fuels 0 1 0.7%
Subtotal: 2 7 6.5%
Product-related Manufacturing Industries:
Food and kindred products 1 8 6.5%
Lumber and wood products, except furniture 1 0 0.7%
Furniture and fixtures 0 2 1.4%
Paper and allied products 1 4 3.6%
Printing, publishing and allied industries 2 1 2.2%
Chemicals & allied products 1 9 7.2%
Petroleum refining and related industries 0 3 2.2%
Rubber & miscellaneous plastic products 1 1 1.4%
Stone, clay, glass, and concrete products 1 1 1.4%
Primary metal industries 2 4 4.3%
Fabricated metal products, except machinery and 0 1 0.7%
transportation equipment
Industrial & commercial machinery and computer equipment 3 6 6.5%
Electronic & electrical equipment & components except 2 7 6.5%
for computers
Transportation equipment 2 2 2.9%
Measuring, analyzing and controlling instruments 2 3 3.6%
Miscellaneous manufacturing industries 1 0 0.7%
Subtotal: 20 52 52.1%
Service Industries:
Motor freight transportation and warehousing 0 2 1.4%
Transportation by air 1 0 0.7%
Communications 0 2 1.4%
Electric, gas & sanitary services 2 15 12.3%
Wholesale trade – durable goods 0 2 1.4%
Wholesale trade – nondurable goods 0 1 0.7%
Building materials, hardware, garden supply, and mobile
home dealers 0 1 0.7%
General merchandise stores 0 1 0.7%
Food stores 0 1 0.7%
Home furniture, furnishings & equipment stores 1 0 0.7%
Eating and drinking places 1 0 0.7%
Miscellaneous retail 0 1 0.7%
Depository institutions 0 4 2.9%
Insurance carriers 2 7 6.5%
Insurance agents, brokers & service 0 1 0.7%
Holding & other investment offices 1 3 2.9%
Personal services 1 0 0.7%
Business services (including EDP) 2 1 2.2%
Motion pictures 1 0 0.7%
Health services 0 1 0.7%
Educational services 0 1 0.7%
Engineering, accounting, research, management & related services 0 1 0.7%
Subtotal: 12 45 41.3%
(N = 138) Total: 34 104 100.0
Information & Management, 28(1), 1995, 13-31
10
Table 2. Size of Respondents' Companies
Company has MKIS? % of
Size of Company No Yes Row Total Row Total
Annual Sales:
Below $ 100 million 2 1 3 2.2%
$ 100 million to below $ 500 million 8 23 31 22.5%
$ 500 million to below $ 1 billion 10 24 34 24.6%
$ 1 billion or above 14 56 70 50.7%
Column Total: 34 104 138 100.0%
% of Column Total: 24.6% 75.4% 100.0%
Number of Employees:
50 to 500 1 1 2 1.4%
501 to 2,000 4 17 21 15.2%
2,001 to 10,000 18 47 65 47.1%
10,001 to 25,000 5 20 25 18.1%
25,001 to 50,000 3 14 17 12.3%
50,001 to 100,000 3 5 8 8.0%
Column Total: 34 104 138 100.0%
% of Column Total: 24.6% 75.4% 100.0%
Table 3. The Ranks of Sources of Information in 1985 and 1993
. Rank . Average Mann-Whitney
Source of Information 1 2 3 Rank Test a
Internal Accounting:
1985 (N = 66) 45 9 12 1.500 0.2482
1993 (N = 102) 62 12 28 1.667
Marketing Research:
1985 (N = 56) 10 27 19 2.161 0.6547
1993 (N = 102) 20 41 41 2.206
Marketing Intelligence:
1985 (N = 57) 21 18 18 1.947 0.0244
1993 (N = 102) 23 30 49 2.255 *
a
Significance level of the Mann-Whitney test of independence between 1985 and 1993 data.
* Significant at p < 0.05
Table 4. The Ranks of Support for Management Levels in 1985 and 1993
. Rank . Average Mann-Whitney
Management Level 1 2 3 Rank Test a
Top Level:
1985 (N = 70) 25 28 17 1.886 0.0203
1993 (N = 92) 26 23 43 2.185 *
Middle Level:
1985 (N = 68) 34 32 2 1.529 0.2936
1993 (N = 92) 42 39 11 1.663
Low Level:
1985 (N = 63) 14 7 42 2.444 0.0369
1993 (N = 92) 31 16 45 2.152 *
a
Significance level of the Mann-Whitney test of independence between 1985 and 1993 data.
* Significant at p < 0.05
Information & Management, 28(1), 1995, 13-31
11
Table 5. The Ranks of Support for Management Functions in 1985 and 1993
. Rank . Average Mann-Whitney
Management Function 1 2 3 Rank Test a
Planning:
1985 (N = 65) 29 14 14 5 3 2.062 0.4716
1993 (N = 92) 47 20 13 3 9 1.989
Organizing:
1985 (N = 55) 1 9 12 30 3 3.455 0.5241
1993 (N = 92) 6 12 24 27 23 3.533
Staffing:
1985 (N = 54) 1 2 5 2 44 4.593 0.6136
1993 (N = 92) 2 5 4 10 71 4.554
Directing:
1985 (N = 64) 14 20 13 16 1 2.531 0.0003
1993 (N = 92) 10 16 24 20 22 3.304 ***
Controlling:
1985 (N = 68) 30 19 15 3 1 1.912 0.0234
1993 (N = 92) 29 27 14 10 12 2.446 *
a
Significance level of the Mann-Whitney test of independence between 1985 and 1993 data.
* Significant at p < 0.05
** Significant at p < 0.01
*** Significant at p < 0.001
Table 6. The Ranks of Support for Marketing Mix in 1985 and 1993
. Rank . Average Mann-Whitney
Marketing-Mix Decision 1 2 3 4 Rank Test a
Product:
1985 (N = 65) 37 11 10 7 1.800 0.0037
1993 (N = 98) 31 29 17 21 2.286 **
Price:
1985 (N = 59) 12 21 12 14 2.475 0.3042
1993 (N = 98) 32 24 23 19 2.296
Place:
1985 (N = 58) 10 11 16 21 2.828 0.3928
1993 (N = 98) 15 20 17 46 2.959
Promotion:
1985 (N = 61) 14 18 19 10 2.410 0.0169
1993 (N = 98) 22 15 19 42 2.827 *
a
Significance level of the Mann-Whitney test of independence between 1985 and 1993 data.
* Significant at p < 0.05
** Significant at p < 0.01
Information & Management, 28(1), 1995, 13-31
12
APPENDIX: Survey Questionnaire
1. Does your firm have a marketing information system (be it manual or computer-based)?
1_____ YES 2_____ NO
If your answer to the above question is NO, please return this questionnaire in the enclosed self-addressed, postage-paid
envelope. Thank you.
2. Does your firm have a company-wide computer information system (CIS)?
1_____ YES 2_____ NO
If YES, does your firm have a formal, written company-wide CIS plan?
1_____ YES 2_____ NO
If YES, is the company-wide CIS plan influenced by your company's marketing strategies?
1_____ YES 2_____ NO
3. Does your firm have a formal, written marketing plan?
1_____ YES 2_____ NO
If YES, is the marketing plan influenced by the status of your company's information-related resources?
1_____ YES 2_____ NO
4. When you think of your firm's marketing information system (MKIS), what do you think of first? (Check only one)
1_____ Computer equipment
2_____ Computer models/programs
3_____ Data storage
4_____ Data retrieval
5_____ Data processing
6_____ Reports
7_____ Areas of marketing operations
8_____ Different managers' information needs
9_____ Other _____________________________________________________________________________________
5. Does your firm have the following activities between branches and the main office? (Check all that apply)
a_____ Video conferences
b_____ Computer conferences
c_____ Electronic mail
d_____ Electronic bulletin board
e_____ Hypertext conferences
f_____ Hypermedia conferences
6. Is your firm's marketing information system in any way computer assisted?
1_____ YES 2_____ NO
Information & Management, 28(1), 1995, 13-31
13
If YES, please give the percentage of usage pertinent to the following types of computers. (Note that the total percentage of
usage should equal 100%.)
a__________ % Supercomputers
b__________ % Mainframe computers
c__________ % Minicomputers
d__________ % Multi-user microcomputers
e__________ % Single-user microcomputers
7. Is a personal computer or terminal available to you in your own office?
1_____ YES 2_____ NO
8. How often do you use a personal computer or terminal?
1_____ Daily
2_____ Two or three times per week
3_____ Once per week
4_____ Once per month or less
5_____ Never
9. If you use a personal computer or terminal, for what purpose do you use it? (Check all that apply)
a_____ Storing data
b_____ Retrieving data
c_____ Processing data
d_____ Decision simulation
e_____ Sending/receiving reports
f_____ Coding computer programs
g_____ Displaying graphic output
h_____ Producing reports
i_____ Responding to inquiries
j_____ Other _____________________________________________________________________________________
10. Does your firm maintain data on the following entities? Which data on these entities is computerized? (Check all that
apply in each category)
Entity Maintained Computerized
Customers 1______ 2______
Potential customers 1______ 2______
Competitors 1______ 2______
Governments 1______ 2______
National economy 1______ 2______
11. Is any preprocessed information (e.g., sales forecasts, market share, distribution trend, etc.) maintained in the database for
immediate response to manager queries?
1_____ YES 2_____ NO 3_____Other: ________________________________________________________
If YES, can you give examples of the information items? ___________________________________________________
_________________________________________________________________________________________________
_________________________________________________________________________________________________
Information & Management, 28(1), 1995, 13-31
14
12. Do your marketing forecasts explicitly include estimates of economic trends?
1_____ YES 2_____ NO 3_____Other: ________________________________________________________
13. Rank the levels of marketing management based on degree of support received from the Marketing Information System
(MKIS). Enter a "1" for the level receiving the most support.
a_____ Top level (vice presidents of marketing, sales, etc.)
b_____ Middle level (regional managers, directors, etc.)
c_____ Low level (office managers, supervisors, etc.)
14. Does your firm have an office concerned primarily with the collection of information on: (Check all that apply)
a_____ Customers b_____ Competitors c_____ Governments
15. Check the following sources of competitor information that your firm utilizes, and the ones that enter the computerized
database. (Check all that apply)
Source Utilized Computerized
Clipping service 1______ 2______
Corporate annual reports 1______ 2______
Salesperson call reports 1______ 2______
Purchased reports 1______ 2______
16. Rank the following data and information sources to your marketing information system. Enter a "1" for the most important
source.
a_____ Internal accounting
b_____ Marketing research
c_____ Marketing intelligence
17. Rank the following decision areas according to the degree of support received from the marketing information system.
Enter a "1" for the most important source.
Rank Marketing Program Computerized
a______ Product-related decisions a______
b______ Pricing decisions b______
c______ Distribution channel decisions c______
d______ Promotional decisions d______
Are descriptions of the above marketing decisions stored in the computerized database? Please check the ones that are
computerized on the right of the above decisions.
18. Does your firm routinely route marketing intelligence information immediately upon receipt to those managers with a need
to know?
1_____ YES 2_____ NO 3_____Other: ________________________________________________________
Information & Management, 28(1), 1995, 13-31
15
19. Which of the following decisions are you responsible for? Do you use computers to assist in making the following
decisions? (Check all that apply in each category.)
Decision Responsible Computer-Assisted
New product evaluation 1______ 2______
Product deletion 1______ 2______
Pricing strategy 1______ 2______
Location of facilities, such as warehouses or stores 1______ 2______
Routing of salesperson or deliveries 1______ 2______
Computing economic order quantities (EOQ) 1______ 2______
Computing reorder points 1______ 2______
Approving customer credit 1______ 2______
Selecting advertising media 1______ 2______
Assigning sales representatives to territories 1______ 2______
Computing operating budgets 1______ 2______
Other _______________________________________ 1______ 2______
20. Are certain models listed above intended for use by particular management levels?
1_____ YES 2_____ NO 3_____Other: ________________________________________________________
21. Rank the management levels in terms of model use. Enter a "1" for the level making greatest use of models.
a_____ Top level (vice presidents of marketing, sales, etc.)
b_____ Middle level (regional managers, directors, etc.)
c_____ Low level (office managers, supervisors, etc.)
22. Rank the marketing management activities according to the degree of support received from the MKIS. Enter a "1" for the
activity receiving the most support.
a_____ Planning
b_____ Organizing
c_____ Staffing
d_____ Directing
e_____ Controlling
23. Which definition most closely describes your marketing information system?
1_____ A data bank that stores data from the environment and makes that data available to a set of computer programs.
The programs produce output that is communicated to the manager on a display unit.
2_____ A group of subsystems that gather information from the environment (customers, competition, government, etc.)
and use it to help the manager answer certain basic questions, such as What is our current situation? Where do we
want to be? What are the constraints? and What action should we take?
3_____ A group of subsystems – each representing an area of marketing activity – product, price, distribution channels, and
promotion. The subsystems help the manager formulate and execute marketing programs.
4_____ A group of four subsystems. Three are concerned with gathering data (marketing research, marketing intelligence,
internal accounting). One subsystem includes decision models that convert the data into information.
Information & Management, 28(1), 1995, 13-31
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5_____ A group of subsystems – some gather data and others process it. The data gathering subsystems are marketing
research, marketing intelligence, and internal accounting. The processing subsystems produce information about
product, price, distribution channels, and promotion.
6_____ None of these definitions fits our system. I would describe our system as follows:
___________________________________________________________________________________________
___________________________________________________________________________________________
___________________________________________________________________________________________
24.To what extent are you satisfied with the capability and quality of your existing marketing information system? (Circle one
number only)
Very satisfied 7 6 5 4 3 2 1 Very dissatisfied
25. Do you think the company-wide computer information system or your marketing information system has somehow created a
competitive edge for your firm?
1_____ YES 2_____ NO
26. If the total percentage of software usage is 100%, what is the percentage of the following software usage in your marketing
information system?
a__________ % Conventional programming--- COBOL, FORTRAN, PL/I, C, etc.
b__________ % A.I./Logic programming--- PROLOG, LISP, SMALLTALK, etc.
c__________ % Expert system shell--- ART, GURU, KEE, OPS5, etc.
d__________ % Decision modeling/Spreadsheets--- EXPRESS, IFPS, SIMPLAN, LOTUS, etc.
e__________ % Database management--- IMS, DB2, ADABASE, IDMS, dBASE, etc.
f__________ % 4th generation/Integrated--- FOCUS, NOMAD, MAPPER, etc.
g__________ % Statistical analysis--- SAS, SPSS, BMDP, MINITAB, etc.
h__________ % Other (specify):____________________________________________________________________