Page 38 - DMGT404 RESEARCH_METHODOLOGY

Research Methodology

Notes Secondary data is classified in terms of its source - either internal or external. Internal, or in-
house data, is secondary information acquired within the organization where research is being
carried out. External secondary data is obtained from outside sources.

Internal Data Sources

Internal secondary data is usually an inexpensive information source for the company conducting
research, and is the place to start for existing operations. Internally generated sales and pricing
data can be used as a research source. The use of this data is to define the competitive position of
the firm, an evaluation of a marketing strategy the firm has used in the past, or gaining a better
understanding of the company's best customers.
There are three main sources of internal data. These are:
1. Sales and marketing reports: These can include such things as:
(a) Type of product/service purchased

(b) Type of end-user/industry segment
(c) Method of payment
(d) Product or product line
(e) Sales territory

(f) Salesperson
(g) Date of purchase
(h) Amount of purchase
(i) Price

(j) Application by product
(k) Location of end-user
2. Accounting and financial records: These are often an overlooked source of internal
secondary information and can be invaluable in the identification, clarification and
prediction of certain problems. Accounting records can be used to evaluate the success of
various marketing strategies such as revenues from a direct marketing campaign.
There are several problems in using accounting and financial data. One is the timeliness
factor – it is often several months before accounting statements are available. Another is
the structure of the records themselves. Most firms do not adequately setup their accounts
to provide the types of answers to research questions that they need. For example, the
account systems should capture project/product costs in order to identify the company's
most profitable (and least profitable) activities.

Companies should also consider establishing performance indicators based on financial
data. These can be industry standards or unique ones designed to measure key performance
factors that will enable the firm to monitor its performance over a period of time and
compare it to its competitors. Some example may be sales per employee, sales per square
foot, expenses per employee (salesperson, etc.).
3. Miscellaneous reports: These can include such things as inventory reports, service calls,
number (qualifications and compensation) of staff, production and R&D reports. Also the
company's business plan and customer calls (complaints) log can be useful sources of
information.

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