2. 2
GIS
• GIS is essential for solving business planning problems
having spatial dimensions
• Developed due to dissatisfaction with socio-economic
groupings
– ‘mass’ marketing ‘niche’ marketing: requires more spatially
disaggregated information about both consumers and competitors.
– The growing establishment of customer databases.
– For competitive advantage and business effectiveness
3. 3
Current Developments
• The business planning segment is presently the fastest growing share
of the GIS market. One reason is that over 80% of business data has
spatial nature (Wallick, 1984)
• Advent of more powerful, cheaper IT is driving product development
and adoption.
• GIS plays a greater role in decision making process for merchandise
and service retail firms.
• Now many GIS systems (OR) models, often industry specific
• The most exciting challenges in location analysis relate to planning for
retail and service firms.
4. 4
How marketers can take the
advantage of GIS
• Better processing spatial data, thus constituting an
information industry that can generate wealth by adding
value.
– Trade area delineation: population within a certain area.
– Geodemographics: analysing patterns of demand across one area
and from one area to another.
– Direct estimation: deriving demand structures for areas.
• Sometimes “a map is worth than thousands of words”
5. 5
Current issues
• Technology is too complex to be understood by end-users
• Modelling procedures are severely lacking
• inefficiencies regarding decision making
• Furthering corporate acceptance of geographic principles
6. 6
Technology is too complex to
understand regarding to end-users
• A fairly simple command structure with a graphical
interface and the ability to answer complex spatial
questions.
– Powerful and flexible analysis capabilities combined with ease
use.( a few button and an answer)
7. 7
Modelling procedures are severely
lacking
• Current models:
– Analogue techniques
– Regression techniques
– Catchment area analysis
– Spatial interaction models
– Location-allocation and optimisation models
– Trial and error
• Integration of these models into a spatial decision support
system(SDSS), aimed to increase the spatial analytical
functions of GIS, are not yet clear.
• Most of these models has its own drawbacks.
8. 8
Drawbacks
• Analogue techniques:success is dependent on whether similar sites are found across town or across
the country. Effective modelling depends on whether trading characteristics can be transferred from
geographical locations. New markets with unusual demographics and competitive profiles may not
match any markets in the analog base(Buxton, 1993)
• Regression techniques: it does not consider interaction at a spatial level. It evaluates sites in
isolation without considering competition or the affects of the corporations networks of stores and
distribution on future store revenues.
• Location-allocation and optimisation models: this technique does not take into consideration any
form of competition other than from its own network sites
• The above models including catchment area analysis and spatial interaction models only consider
existing outlets within a market and rarely have a flat playing field where there are no existing
outlets.
• Trial and error approach: the technique is highly subjective and relies on the experience of key
individuals. In many instances it is a very time consuming and expensive technique. It also may be
impractical to visit al potentially feasible sites.
9. 9
Inefficiencies regarding decision
making
• There is a limited degree of attention to examine the
societal context which influence the efficiencies of GIS in
business decision making.
– Collaboration, organisational communication relating to GIS
adoption in business firms.
– Users insights and qualifications
– The consideration of data accessibility, data protection when
adopting GIS in decision making system.
10. 10
Furthering corporate acceptance of
geographic principles
• Does geodemographic modelling lead to redlining or other forms of
geographical exclusion or, on the other hand, more efficient niche
marketing and better, specialised location and investment decisions?
• To what extent GIS is an integral component of the formulation,
implementation, and evaluation of any marketing strategy plan.
• What are the implications of widespread use of spatial interaction and
location-allocation models in corporate geography for competition,
and for corporate welfare.
11. 11
Why carry out this research
• To date, no many systematic, theoretically grounded study of GIS
implementation across multiple private-sector organisation has been
published.
• An in depth understanding and investigation of the above problems so
as to identify the most cost effective and successful marketing strategy
for businesses regarding GIS application.
• A modelling will be designed based on the data collected and applied
with the collaboration retail industry, thus to identify the usefulness
and efficiencies of GIS into decision making.
