1st Presentation: Overview of Marketing “Fools learn by their mistakes and the wise from others” (Anonymous) By Victor Somosu- For The CRM Part of VCS521M
An Overview of Strategic Marketing Objectives To overview the role of Marketing and environmental forces in our society. To identify important terms & concepts such as the Marketing Mix and Exchange Relationships. To understand the marketing process, the Marketing Concept and the societal concept.
PRODUCTION Major Business Functions MARKETING FINANCE HUMAN RESOURCES
Marketing Is the IntegratingFunction Human Resources Production Operations MARKETING CUSTOMER Finance Legal Collaborators Logistics
PRODUCERS MARKETING The Marketing Function is theProcess ofBringing Buyers and Sellers Together CONSUMERS Marketing Is Performed by All Organizations
An exchange process • To find a need/want and fill it .…by solving a customer’s problem What Is Marketing ? Example: An unmet need or want: e.g. cell phones Marketing is about peopleAs you know, marketing has a myriad of definitions. Regardless which one you prefer, they all have one element in common: Marketing is about people. By acknowledging the customers’ needs and expectations, the service delivery process must focus on producing customer satisfaction, which in turn will support continued growth through optimum customer loyalty.
Macro Marketing A broad view: • An Economic role. . . To allocate resources among competitors so that supply equals demand • A Managerial philosophy Production Orientation Sales focus Marketing Focus Societal Focus ? Macro marketing “The delivery of a standard of living to society.”
Micro Marketing is . . . - The process of planning and executing the conception, pricing, promotion and distribution of ideas, goods and services to create exchanges that satisfy (individual + organizational) objectives. AMA Board (1985) • The process of creating, distributing, promoting, and pricing goods, services, and ideas to facilitate satisfying exchange relationships with customers in a dynamic environment.
Convenience store A Micro View of Marketing • A “Hands on” process within each firm Product price promotion Place (physical distribution) Micromarketing • “having the right goods or services at the right time and the right place in the right assortment.”
Marketing Satisfies . . . - Needs and wants … that derive from basic values & cultural conditioning by developing product utilities such as . . . Form . . . . . . . production + marketing Time………….. storage, Place…………. assemble, transport, Ownership….. legal possessions Information….image (perception) Value…………..price & quality . . . through the exchange process.
A Voluntary Exchange Process SOMETHING OF VALUE SELLERBUYER • Exchange process • The provision or transfer of goods, services, or ideas in return for something of value (money, credit, labor, goods)
Examples of Exchange Product Money (good) Politician Vote (service performance) Social Values Behavioral (ideas) Support
Marketing Builds Satisfying Exchange Relationships Exchange conditions • Two or more participants with unmet needs or wants and something of value to offer • Effective communication & confidence in the exchange sys • Mutual Satisfaction of exchange expectations to build trust • An Exchange mechanism CONSUMERS
AnOxymoron ....Pls. Review the article-The reality Check • Marketing by accountants has moved from referrals and golf outings to hard sell campaigns. The undignified has become acceptable; the cornerstone of most Organizations.
The Marketing Mix,Creating aCompetitiveAdvantage Begins with the Target Market = Customer Needs
The Marketing Mix (4 P’s),is a creative process PRODUCT PRICE TARGET CUSTOMERS DISTRIBUTION PROMOTION
The Service Marketing Mix (7 P’s), is a creative process • The Four Ps of Price, Promotion, Place and the Product • People • Physical Evidence • Process
Information gaps Social trends Technology trends Economic trends Legal environment Competitive environment Information gaps Cultural Social class Reference groups Motivations Management of Marketing Mix Producer (Create Value) Consumer (Wants Value)
A Competitive Advantage can bePhysical . . . or. . . Psychological Product Differentiation • Used to give products unique identities to distinguish them from their competitors. • Example: Branding Glass cleaners Windex
An example Find a need/want & fill it
Product Price Promotion Physical Distribution Salvation Values/Beliefs Norms of Behavior Tithing/Fasting Personal Selling Pilgrimages/Mail Church/Synagogue When 2 people ... The Marketing Mix and Religion Churches turn to research in saving new souls
Marketing Occurs in a Dynamic & Uncontrollable Environment Competitive Economic Political Legal Regulatory Technological Sociocultural
Environmental Trends influence demand & type of marketing mix Economic Prosperity Economic Turmoil Government Laws to foster competition Microsoft/US/EU antitrust Government Taxes Technology creates New Products-GTL Technology creates Product Obsolescence
The Wall Street Journal Sept 11th 2001 • Essence: Marketing occurs in a dynamic & uncontrollable environment. Tobacco Companies have to understand external forces • Competitive • Political • Legal/ethical • Socio-cultural • Economic } Interpreting the external environment (Marketing Management)
Tobacco Industry’s Environment World Health Organizations (WHO): • Promote a global treaty to curb cigarette smoking • Framework Convention on Tobacco Control (FCTC) Antismoking activists Government
Tobacco Industry’s Environment • Different measures for different countries • Different legal and political regulations • Most stringent countries: • Thailand: Banned all cigarettes advertising • U.S.: Ban for advertising a billboards (1998)
Innovative Marketing strategies for changing environments • Global positioning:Think about globalization and focus on core competencies- greener environment. • The master brand:this is the fundamental strength of Toyota and Honda compared to the dozens of brands operated by General Motors • The integrated enterprise and end-user focus: the challenge of managing people, processes and infrastructure to deliver value to an end-user. • Best-in-class processes:the challenge is to meet world-class standards e.g.Federal Express and Marriott hotelsare some of the benchmarks used
Continued….. • Mass customization:service tailored to the individual Customer's requirements. • Breakthrough technology:new technology will underpin every aspect of the marketing process, even the product itself • Markets shape business strategy:Experts suggests that the market will be seen as the dominant force shaping how business operates. • Networks of interlinked product markets:How else do we make sense of Virgin moving from music to retailing to airlines to rail transport to financial services to cosmetics to drinks to clothes, all under the single Virgin brand?Or Telecom Namibia’s Switch
Continued….. • The move from functions to processes:increasingly focus on the process of going to market not the interests of traditional departments and specialists. • Strategic alliances:for many companies the future will be one of collaboration and partnership to allow them to focus on core competencies, not one of the traditional competition. • The balanced scorecard:keeping score involves evaluating the benefits we deliver to all the stakeholders in the organization e.g. performance metrics, intangibles assets, value returns etc.
Complexity of Marketing Multiple decision makers Domestic factors Complex interactions Global factors Interaction Time frame
Marketing Management Marketing management is the process of … “Interpreting” the external environment (the firm’s and the prospect’s) … To develop internal strategy and tactics (by allocating company resources to alternative marketing mixes directed at selected target markets) … To influence (control) the level of brand demand … To achieve organizational objectives (profit)
Marketing Management • The process of planning, organizing, implementing, and controlling marketing activities to facilitate exchanges effectively and efficiently • Effectiveness • The degree to which an exchange helps an organization achieve its objectives • Efficiency • The process of minimizing the resources an organization must spend to achieve a specific level of desired exchanges
The elements which are fundamentalto Marketing Success/efficiency but often forgotten and neglected. • Profound understanding of the market place –through a first rated marketing information systems. • Creative segmentation and targeting: Virgin. • Powerful differentiation, positioning and branding: Differentiate or die-RyanAir, Kulala Air, Dell, Pepsi, MacDonald’s Gillette, Sony etc • Effective marketing planning processes • Long-term integrated marketing strategies.
Continued………………. • Institutionalized creativity and innovation: thinking outside the boxe.g. Red Bull in the Formula 1-power of the brands • Market-driven organizational structures:Organizational structures must be developed based on the market place in which the organization operates. • Careful Marketing recruitment, training and career management:To interface with consumers and to meet their needs, an organization needs individuals who are comfortable and committed to other people
The Effects of Inaccurate Environmental Analysis Lack of Direction WHICH ADVERSELYAFFECTS COMPANYPER- FORMANCE POOR ANALYSIS MAY LEAD TO Missed Opportunities Legislative Violations
Stew Leonard’s Philosophy • Rule #1 - THE CUSTOMER IS ALWAYS RIGHT!!! • Rule #2 - IF THE CUSTOMER IS EVER WRONG, REREAD RULE #1
A Systems View • Management is a total system of functional subsets such as finance, production,marketing etc., operating as one unit. (Wholistic) • Avoid: inverting the means with the end.
A Systems View of Strategic Marketing Influences Economics Social Culture Personnel Political Legal Top Mgmt Acctg. Marketing Organization & Consumer Wants Finance Technology R & D Legal Production Monopoly Pure Competition