Statistical Methods in Marketing

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Marketing has been defined by the American Marketing Association as a term that denotes the form of activities and an assortment of institutions as well as processes of creating, communicating and also delivering and the exchange of offerings that hold significant value for customers or the clientele pool (and the entire society at large) of a particular company’s services and/or products. Marketing is normally perceived as creative industry entailing the common fronts and concepts of advertising, distribution and selling. As such this business organisational aspect also pertains to the mean so anticipating client’s future needs (normally discovered through market research) and expectations and strategising to meet and fulfill them. Effective and feasible marketing models have been hailed for their fruitage and effectiveness in fostering long term relationship between business organisations and other non-business institutions and the clientele base. The models play expediently into conceptual and strategic thrusts aimed at precipitating among other things, goodwill ad optimal service and product provisions and enhancing organisations’ image and communicating its culture. It is in this conceptual and theoretical framework extension that this paper has been drafted in the objective of; among other things, exploring the significance of statistical methods in marketing and its role in light of its importance to the business organisation and the community within which the business establishment serves.


In marketing statistical methods are used particularly to establish customer and staff trends for instance where issues of customer turnover are of huge concern. Statistical methods are also common where cross and up sell rates can be improved. Statistical methods in marketing are also common where decisions have to be made about specific ways of increasing customer acquisition.

All such matters can be addresses through the application of statistical methods on data stored and accumulated about customers in customer databases. Such data is normally stored in server logs and from survey and research data. The use application of statistical methods on such data has for instance led to modeling of inferential techniques to predict the likelihood of customer switching from one brand to the next alternative through an aggregation of date from various sources used to build such inferential models.

The works of Reichheld and Sasser (1990) have made significant contributions to the bodies of knowledge in the subject of the significance of behavioral marketing for a organisation and the community within which it operates. Beyond the commonplace functionalities of marketing which are realised through the associative fronts of advertising (the four Ps), distribution and selling marketing plays a fundamental role in other principal organisation goals such as competitiveness and long term sustainability. Researches have illuminated feasible marketing thrusts results in high rate of customer retention, which stabilises a business establishment’s customer’s base for long term time frames. These are leveraged on inferential positions arrived at through the application statistical methods on obtained marketing data.

The scholars in the works present their findings which entail that profit margin(s) in service provisions sectors and industries including credit card companies grew in proportionality to the longevity of a company’s marketing stratagem in relation to its yield of customer’s relationship with the service company. This is again has been obtained through the application of tailored statistical methods on marketing research data and other data components germane to the making sound conclusions based on empirical data. The scholars underscore in particular the incidences of MBNA in America. “Customer defections ‘swat’ team staffed by some of the company’s best telemarketers”. The scholars have mentioned that this amounted to a 50% success rate in luring clients to retain their credit cards. The scholars also indicate that a 5 % growth in customer retention raised average customer value by 125%. In the conclusion of the empirical data based conceptions on customer retention in e-businesses companies, Reichheld and Sasser (1990) indicated that, “cutting defections in half could more than double the growth rate of the average company.” This serves to illumine the critical importance of the application of statistical methods in marketing for organisations to map out survival and sustainability stratagems.

The works of Everett (1993) who also explores similar dimensions and dynamic have also spawned the broadening of perspectives in the study of the importance of marketing statistics. His work has laid invaluable ideas in the marketing studies owing to his notions on that a committed client retention unit designed by Patrick J. Swanick at the Society National Firm in Cleveland, attained a 57% accomplishment rate in influencing callers to continue with the Cyber oriented e-commerce institution. Everett has underscored that the success of the marketing model in this scenario involved the probing for causes for potential business failures and that the causes established empowered the e-firms staff to come up with feasible marketing resolutions. This can be achieved through implementation and application of feasible and relevant statistical methods on marketing data. The success of the approach was further enhanced by adopting contemporary means of conducting effective marketing drawing from inference of evaluated marketing data.

Various scholars have attempted to establish the relationship surmised between the aspect of marketing success and customer satisfaction. The works of Reichheld and Kenny (1990), have explored the close relationship between the client satisfaction and the role of marketing. From another different yet related perspective the contributions made by Bowen and Lawler (1990) as well as that of Schlesinger and Heskett (1991) delve into the dynamics around the link between marketing versus the quality of service the customer get from their service institutions. The salient point underscored on the established link is that the link and other implications can be reached through an application of statistical methods to establish the opinion and position of clients as well as that of personnel on particular aspect of service and product provision.

Some researches have also illumined the relationship that exists between the aspects of behaviors, skills and service quality and marketing. Zeithaml, et. al. (1990) has underscored the essence of adopting paradigmatic shifts form personnel management in way of enabling personnel to assume responsibility. (Schlesinger and Heskett, 1991) also concurs, “Personnel have to take responsibility, think for themselves and respond well to pressure from customers”. The works of Bowen and Lawler (1990), Reichheld and Kenny (1990) also reinforce the significance of empowering to take responsibilities and be at the forefront of problem, resolution in matter that relate to customers and the service provision interface. He details that effective marketing strategies must view the role of personnel as holistic such that the entirety of the organisation in all fronts is a marketing vehicle. This he bases on the critical importance of marketing in defining an organisation service and product provision culture among other fundamental functions of marketing such as raising awareness and keeping competitive. Notably the relationship between the aspects of behaviors, skills and service quality and marketing are well established though a statistical evaluation of marketing related data. Inferences and findings can then be used to establish loopholes and address them.

Marketing also plays a significant for the role it plays in the community within which a business establishment operates. Marketing influences the culture of society throes channels of consumer behaviors and the role of mass media. This is illustrated in manner and lengths at organisational go at ensuring cultural and communication relevance where marketing is done especially in global markets. Kitchen (1999) states that a concept of effective marketing display-rules can help advertisers to appeal to global target audiences. Effective marketing consists of cultural rules that govern proper and improper ways to express emotion. In effect, these may alter or inhibit the direct expression of emotion in order to conform to the expectations of a social situation. In order to reach global consumers, art directors and copywriters take into account cultural preferences, global mass culture and impact on country of origin. Researchers state that privacy requires special protection by society because they represent indispensable conditions for an existence worthy of a human being. The general notion of privacy does not impede society from curtailing or even abolishing particular rights with a view to the promotion of overriding interests, often designated as belonging to “the general interest” or “the common good.” However, when interests are presented as privacy issues the use of this terminology implies that they cannot be simply discarded for the sake of overriding interests. Privacy is meant to be of a higher rank than rights not so named, and the purpose of this higher rank is to ensure that the social system serves those basic privacy interests which are indispensable for a life of human dignity. In light of the foregoing the scholars have cited many marketers do almost of statistical evaluation in determining marketing target response, approximating reaction and measuring marketing success.


Marketers are in a constant flux to develop new strategies and expand their markets and achieve advantages presented by economies of scale through sweeping phenomena such as globalization. The aim of every supplier all around the world is to effectively tap their target audience, to effective inform them of the commodity being offered and make a sale, many methods have been employed and revolutionized and of this the newest being digital advertising. This method provides the opportunity to easily manipulate and work with the content in hand. An example of this may be that data sent to mobiles and internet can be detected and traced easily. Online advertising has changed the realm of advertising in the past few decades by adding a lot more features to the conventional brick and mortar marketing could only imagine. Chief Executive Officer of the interactive advertising bureau (IAB) Mr. Rothenberg adds that the field of interactive marketing has been steadily growing and developed vitality and more areas of expansion are expected wince consumers in this age are spending double the time online compared to the past. (Potter 2005). This h bases on the growth of the employ of statistical methods in the expansive field of marketing as a way of enhancing existing marketing approaches and models as well formulating and customizing known marketing strategies for custom circumstances.


Reichheld and Sasser (2004), Regulating AdWords: Consumer Protection in a Market Where the Commodity is Speech. Web.

Everett, R. (2005), Integrated Marketing Communication – First Pacific Rim Edition. South Melbourne: Thomson Learning.

Reichheld and Kenny (2002), Integrated Advertising, Promotion and Marketing Communications, Prentice Hall/Pearson Education: Upper Saddle River, NJ.

Bowen and Lawler (2001), Watching while you surf. Web.

Schlesinger and Heskett (1991), What’s Not to Like About Behavioural Targeting? Web.

Zeithaml, G.(2001), Advertising Imagery and Consumer Processing Styles. Journal of Advertising Research, 38 (6), 29-33.

Schlesinger and Heskett, (2006), The Little Blue Book of Advertising: 52 Small Ideas That Can Make a Big Difference. Portfolio Hardcover.

McDonald M, (2003), Marketing: A complete Guide. Palgrave Macmillan.

Potter M. (2005), Advertising: Principles and Practice. Prentice Hall; 7 edn.

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