In a short essay, describe the uses of scanner data and list at least three advantages and three disadvantages of using scanner data

Question

What will be an ideal response?

Answer 1

Scanner data are useful for a variety of purposes. National volume-tracking data can be used for tracking sales, prices, distribution, modeling, and analyzing early warning signals. Scanner panels with cable TV can be used for testing new products, repositioning products, analyzing promotional mix, and making advertising and pricing decisions. These panels provide marketing researchers with a unique controlled environment for the manipulation of marketing variables.
a. The advantages of using scanner data include having the data available more quickly and also that the data is typically more accurate than data collected through either surveys or panels. Errors due to failures in recall are also eliminated with electronic data collection. Another advantage is that in-store variables such as pricing, promotions, and displays are also recorded. Finally, a scanner panel with cable TV provides a highly controlled test environment for alternate promotional messages.
b. The disadvantages of using scanner data include its lack of representativeness. Another disadvantage is that the quality of scanner data is only as good as the scanning process itself and may be limited. With respect to scanner panels, the available technology permits the monitoring of only one TV set per household. Hence, there is a built-in bias if the household has a second or third TV set because the viewing of these additional sets is not considered. Also, the system provided information on TV sets in use rather than actual viewing behavior.