Marketing Information System (A BANKING SYSTEM CASE STUDY)
A Marketing Information system (MkIS) is a branch of Management information system used to make marketing decisions and strategies for the business. It was also first defined by (Cox and Good, 1967) as a set of procedures and methods for the regular planned analysis and presentation of information for use in the making of marketing decisions. In the past, traditional marketing methods were carried out through billboards, newspapers, radios and television and the data with the number of converted leads or the ads that converted to sales could not be properly collected.
However in the age of information technology and digital marketing, a lot of things have changed and the processes have become more seamless. Brienn and Stafford recognised the impact of MkIS on the marketing department and how they are now able to make informed decisions and strategies based on information that the MkIS provides. ( cited in Colgate, 1998)
Marketing Information systems can be used in various organizations and industries; in this paper, the focus will be on the financial and banking industry.
The use of information systems in the banking industry spreads wide across different platforms like the automated teller machine (ATM), Mobile banking apps, Point of Sale Machines (POS) Online payment platforms, SMS, USSD etc. These are more convenient options for customers rather than having to go to the bank to perform these transactions.
A Typical Marketing Information System Chart
Source: (Colgate, 1998)
Benefits of Marketing Information system in the financial industry include:
-A Strong Customer database. (Radding 1989), revealed in his analysis that relationship banking without customer bases, is relatively impossible. The information provided in customer databases is used to form stronger ties with them.
-It provides Competitive Advantage as the more information gathered by the banks on their customers, the more difficult it is for them to be poached by new entrant banks.
- And MkIS can also Reduce The Risk involved in operating a banking system. The client database collects all necessary information related to a client therefore in the case where any client has to take a loan from the bank, information provided by MkIS can predict if they are likely to default on the loan or not.
MkIs has been widely accepted by users worldwide especially in developed countries generally because it is an easier and more timely process of banking. The Unified Theory of Acceptance and Use of Technology (UTAUT) seeks to clarify user intentions to use an IS and consequent usage behavior. The theory proposes that four key factors (performance expectancy, effort expectancy, social influence, and facilitating conditions) are direct determinants of usage behavior. This model helps managers to measure the chance of success of a new technology and assists them to recognise what drives the success and acceptance and use the strategies that have been used on people who've accepted in converting those that were less receptive (Halawi and Mccarthy, 2006).
However the fact that the marketing methods that work for developed countries don't necessarily work for those in the developing countries or rural areas of the developed countries, it goes to show that this model is somewhat faulty.
The data gathered on performance or social influence of a new technology say ATMs in a developed country cannot inform the strategies and decisions that will be made in the case of underdeveloped areas. However, the data gathered, if tailored towards what will suit the target audience in question might end up being useful.
For example data will show that people in developed areas are more open to MkIS processes because they are more exposed (Colgate, 1998). This data can be used to start an awareness program in the underdeveloped areas first before going ahead to install an ATM.
Another example is the use of ATM cards to make purchases online; while in developed areas, people will glady shop online from the comfort of their homes, those in underdeveloped areas will rather go to the store, see what they are paying for, before they exchange cash for the product. This is due to lack of adequate information about the firewalls that have been built to prevent fraudulent activities for card users.
Therefore another model like the two factor theory adapted from Herzberg’s two factor theory of motivation (Herzberg, 1987) which has recently emerged in Information system research (Park and Ryoo, 2013) because of its ability to characterize factors such as enablers and inhibitors to the use of Information system methods by end users can be used to analyze the different groups of people that banks and the financial industry caters to. This will help to understand the MkIs methods that work for each group of people.
In conclusion, it can be said that most successful banking systems are the ones that had greater responsibility in marketing activities, implemented proper MkIS processes and had the resources to invest in it both in developed and developing areas.
References
Colgate, Mark. “Creating Sustainable Competitive Advantage through Marketing Information System Technology: A Triangulation Methodology within the Banking Industry.” International Journal of Bank Marketing, vol. 16, no. 2, Apr. 1998, pp. 80–89, 10.1108/02652329810206734. Accessed 29 Apr. 2019.
Cox, D.F. and Good, R.E., 1967. How to build a marketing information system. Harvard Business Review, 45(3), pp.145-154.
Halawi, L, and R Mccarthy. “Which Theory Applies: An Analysis of Information Systems Research.” Issues in Information Systems, vol. 7, no. 2, 2006, commons.erau.edu/cgi/viewcontent.cgi?article=1360&context=publication#:~:text=The%20significant%20information%20systems%20theories.
Park, S.C. and Ryoo, S.Y., 2013. An empirical investigation of end-users’ switching toward cloud computing: A two factor theory perspective. Computers in Human Behavior, 29(1), pp.160-170.
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