MTMM Wrap Up–1

Marketing Engineering:A Look Ahead

MTMM Wrap Up–2

Information Technologies

Harnessing information technologies to improve the efficiency and effectiveness of marketing.

Today’s computer and communication technologies allow us to generate, capture, store, manipulate, replicate, distribute and receive digital signals representing data and information (organized data).

Information technology is everywhere!

MTMM Wrap Up–4

Did You Know?

The U.S. accounts for more than 40% of the world's investments in information technology ($ 850 per person per year compared to a global average of $ 98) (Fortune, June 9, 1997).

MCI developed the “Friends and Family” product by analyzing its databases and determining that most households regularly call at most 12 other telephone numbers?

MTMM Wrap Up–5

Did You Know?

FedEx receives two-thirds of its orders via its point-of-sale hardware and software. Without it, the company would have to add 20,000 employees and generate an additional two billion pieces of paper per year (Fortune, June 9, 1997).

Sun Microsystems reduced customer service phone calls by 20% by providing online documents (PC Magazine). Cost of telephone call ($2.00); Cost of a “web call” is $0.05.

MTMM Wrap Up–6

Did You Know?

Wal-Mart has a data warehouse with about 8 terabytes of data (6 billion pages) which are analyzed by 30 million lines of proprietary software code. It can compute the profit associated with every one of

65 million transactions it has with consumers every week in 3,000+ stores in seven countries.

It can change prices of individual items in a store three times a day.

It achieves higher inventory turns than any other large retailer (profit = margin*inventory turns).

MTMM Wrap Up–8

Marketing Engineering:A Look Ahead

Data warehousing

Online analytic processing (OLAP)

Intelligent marketing systems

Simulations

Groupware

Improved user interfaces

To: Sizzle Brand ManagerFrom: CoverStoryDate: 07/05/89Subject: Sizzle Brand Summary for Twelve Weeks Ending May 21, 1989

Sizzle’s share of type in total United States was 8.3 in the C&B Juice/Drink category for the twelve weeks ending 5/21/98. This is an increase of 0.2 points from a year earlier, but down 0.3 from last period. This reflects volume sales of 8.2 million gallons. Category volume (currently 99.9 million gallons) declined 1.3% from a year earlier.

Sizzle’s share of type is 8.3—up 0.2from the same period last year.

Display activity and unsupported price cuts rose over the past year—unsupported price cuts from 38 points to 46. Featuring and price remained at about the same level as a year earlier.

Components of Sizzle Share

Among components of Sizzle, the principal gainer is:

Sizzle 64oz: up 0.5 points from last year to 3.7

and losers:Sizzle 48 oz: down 0.2 to 1.9Sizzle 32 oz: down 0.1 to 0.7

Sizzle 64 oz’s share of type increase is partly due to 11.3 points ride in % ACV with Display vs. year ago.

Components of Sizzle Share

Among Sizzle’s major competitors, the principal gainers are:

Shakey: up 2.5 points from last year to 32.6Private Label: +0.5 to 19.9 (but down 0.3

since last period)

and loser:Generic Seltzer: –0.7 to 3.5

Shakey’s share of type increase is . . .

Vol

ume

Sha

re

Mer

chan

disi

ng I

ndex

Share & Merchandising

0

2

4

6

8

10

12

0

10

20

30

40

01-31-88 07-17-88 01-31-89

Volume Share Merchandising Index

MTMM Wrap Up–21

Modelling Technology

Model User

Decision Tasks

MarketingEngineeringtoday

MarketingEngineeringtomorrow

Intelligent/automated decision models

Groupware plus decision models

OLAP plus decision models

Stand-alone marketing decision models

General purpose analysis tools (eg, SPSS, LP packages)

Analyst Trainedmanager

(in marketingengineering)

Novicemanager

Non-managerialemployeeForecasting

Allocation and optimization

Simulation

Explanation

An overview of the evolution of Marketing Engineering to support a wider range of users and decision tasks using emerging technologies

MTMM Wrap Up–22

MTMM Wrap Up–11

Our Future Plans forMarketing Engineering

Test effects of Marketing Engineering under controlled experimental conditions

Implement ideas/tools in companies

Development and testing of Network and Professional versions

Enhance existing models

Develop new models (e.g., generalized resource allocator, sales territory alignment, enhanced choice modeling)

Marketing Engineering on the Net