UNIT 1
MARKETING ANALYTICS
Marketing analytics
• Marketing analytics is the practice of
measuring, managing and analyzing marketing
performance to maximize its effectiveness and
optimize return on investment (ROI)
• It involves collecting data from various sources
such as website analytics, customer surveys,
social media, and sales data to gain insights
into customer behavior and marketing
campaign performance
Scope of Marketing Analytics:
• Customer Analysis: Studying customer
behavior, preferences, and demographics to
create targeted marketing strategies.
• Campaign Performance: Measuring the
effectiveness of marketing campaigns and
making data-driven decisions for optimization.
• Market Research: Conducting research to
understand market trends and consumer
behavior.
• Pricing Strategy: Determining optimal pricing
strategies by analyzing consumer behavior and market
trends.
• Channel Optimization: Analyzing and optimizing
marketing channels such as email, social media, and
paid advertising.
• Sales Forecasting: Predicting future sales and revenue
based on historical data and market trends.
• Customer Segmentation: Segmenting customers based
on various attributes to create more personalized
marketing campaigns.
Advantages of Marketing Analytics
• Data-Driven Decision Making
• ROI Measurement:
• Customer Segmentation:
• Campaign Performance Evaluation:
Market Data Sources
• Primary Market Research
Primary research is research that is conducted
by you, or someone you pay to do original
research on your behalf. You gather this data
by running a survey, interviewing people,
observing behavior, or by using some other
market research method.
Secondary Market Research
• Sometimes called “desk research” (because it can
be done from behind a desk), this technique
involves research and analysis of existing research
and data; hence the name, “secondary research.”
• Internal company data like customer details, sales
figures, employee timecards, etc. can also be
considered secondary data. Published articles,
including peer-reviewed journals, newspapers,
magazines, and even blog postings count as
secondary data sources.
Market Size
• Market size can be simply defined as “the
number of people likely to buy a product or
service.”
• Many businesses have a rough idea of who their
market is or how many individuals it might
involve, but it’s important to accurately estimate
market size in order to plan for things like
budgets, sales goals, marketing efforts, and
staffing. Knowing how large your market can be
directly proportional to your business efforts.
How to Evaluate Market Size?
Look at the competition: Are you the only provider of your
business or service locally? Regionally? Nationally? This will
tell you a lot about the potential size of your market. If you
have a lot of competition, you know you are competing with
other businesses for customers, effectively reducing or
limiting your potential market.
Understand your product: Be realistic about things that will
affect who will buy your product. Things like cost, usefulness,
reliability, or availability will influence how many people are
truly in your market.
• Understand your customer: Similar to understanding your
product, you must know something about your customer
when doing market size calculation. Are your customers likely
to be male? That tells you something about your market. Are
they likely to be college-educated? Found in cities? Make a
certain salary a year? Knowing your target customer always
leads to helping you estimate your market size.
Stakeholders
• A stakeholder is a party that has an interest in a company
and can either affect or be affected by the business. The
primary stakeholders in a typical corporation are its
investors, employees, customers and suppliers.
• Stakeholders can be internal or external.
• Internal stakeholders are people whose interest in a
company comes through a direct relationship, such as
employment, ownership or investment.
• External stakeholders are those people who do not
directly work with a company but are affected in some
way by the actions and outcomes of said business.
Suppliers, creditors and public groups are all considered
external stakeholders.
Stakeholders
• A stakeholder is a party that has an interest in a company
and can either affect or be affected by the business. The
primary stakeholders in a typical corporation are its
investors, employees, customers and suppliers.
• Stakeholders can be internal or external.
• Internal stakeholders are people whose interest in a
company comes through a direct relationship, such as
employment, ownership or investment.
• External stakeholders are those people who do not
directly work with a company but are affected in some
way by the actions and outcomes of said business.
Suppliers, creditors and public groups are all considered
external stakeholders.
External Environment Analysis: PESTEL
PESTEL analysis includes Political, Economic, Social,
Technological, Environmental and Legal analysis. It is
an external environment analysis for conducting a
strategic analysis or carrying out market research. It
offers a certain overview of the varied macro-
environmental factors that the company has to
consider.
Porter’s Five Forces Model
Porter’s Five Forces is a business analysis model that
helps to explain why different industries are able to
sustain different levels of profitability. The model was
originally published in Michael Porter’s book,
“Competitive Strategy: Techniques for Analyzing
Industries and Competitors” in 1980
These forces are:
• Competition in the industry;
• Potential of new entrants into the industry;
• Power of suppliers;
• Power of customers;
• Threat of substitute products.
Application of Porter’s Five Forces
Model
• Competitive Analysis:
Companies use the model to assess the competitive dynamics
within their industry. By evaluating the intensity of each force,
businesses can gain insights into the level of rivalry, bargaining
power of suppliers and buyers, threat of substitutes, and barriers to
entry.
• Market Entry Strategy:
Before entering a new market, businesses can apply the Five Forces
Model to assess the potential risks and opportunities. This analysis
helps in making informed decisions about the feasibility and
attractiveness of entering a specific market.
• Mergers and Acquisitions (M&A):
When considering M&A activities, firms evaluate the industry’s
competitive forces to understand how the acquisition target fits into the
broader competitive landscape. This analysis informs decisions about
potential synergies and risks associated with the acquisition.
