Microsoft Word marketing doc

6.4 O
RGANISING AND ANALYSING INFORMATION FOR IMPROVING SALES
. 
 
 
T
HE 
I
NTERNAL 
A
CCOUNTING 
S
YSTEM
. 
The system basically reports order booking position, sales, stock levels, 
receivables and so on and is an effective tool to assist decision making with 
regard to management of sales. 
The sales force and elements of the channel of distribution place orders 
with a firm. Copies of these orders are sent to various departments. Stock 
levels are accompanied by relevant documents which are again set to various 
departments. Invoices are then raised on the buyer and effective follow up 
action needs to be taken to ensure collection of payments. 
In order to ensure the effective functioning of the cycle, all activities like 
placing of the order, review of stock position, despatch of goods, billing and 
collection should be carried out in a timely manner. That is why the need for 
accurate, concise and timely information becomes important. In order to have 
such information, organisations have developed various reporting formats for 
each activity. These formats include sales reports, stock reports, statements of 
outstanding etc. In designing sales information systems the company should be 
able to avoid certain pit falls, given below. 
i) the information should be too voluminous; and, 
ii) the information should be relevant to the decision to be taken. 

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The ideal sales information system should represent a compromise 
between what managers think they need, what managers really need and what is 
economically feasible. 
For example, to know the need of advertising and to set the size of 
advertising budget by the Brand Managers, they should know the degree to 
marketing saturation, the rate of sales decline in the absence of advertising and 
the spending plan of competitors. 
The information system is to be designed to provide these data needed of 
making the key marketing decision. 
Analytical Marketing System : 
An 
analytical 
marketing system consists of advanced techniques for 
analyzing marketing data and problems. Such a system normally includes a 
Statistical Bank and a Model Bank.
a) Statistical Bank
This is a collection of statistical procedure, for extracting meaningful 
information from data. It includes normal statistical tools like averages, 
regression analysis, cross tabulation, discriminant analysis, factor analysis and 
cluster analysis 
b) Model Bank 
This is a collection of models which aid decision making. A model may 
be defined as set of variables and their interrelationships designed to represent a 
real system. Such models help in the stimulation of real life situations there by 
enabling prediction and control. Some models which have came to be used 
extensively by companies include. 
-
Sales forecasting models. 
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Transportation planning model. 
-
Media mix planning model. 
Models can be of two types–namely: i) descriptive model & ii) decision 
model. 

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I) 
Descriptive Model : 
These models are designed to communicate, explain or predict. The 
descriptive models can be built at three levels. 
i) 
Macro Model : 
This consists of a few variable and a set of relationships among them.
Ex. Relationship between sales and national income, price and advertising etc. 
ii) 
Micro Analytical Model : 
It specifies more links between a dependent variable and its 
determinants, eg. impact of advertising and sales through linkages, reach 
frequency, consumer trial etc. 
iii) 
Micro behavioural Model : 
This model creates hypothetical entities who interact and produce a 
record of behaviour which is then analyzed. 
Besides queuing models also describe waiting line situations and their 
impact. 
II) 
Decision models : 
Decision models assist managers to circulate alternatives and find 
optimum solutions. Ex. Differential calculus mathematical programmes 
statistical decision models and game theory.