Marketing Data from Customers - Essay Example

DATA1 Database marts/data mining The results of the chain stores like Wal Mart show companies getting more and more of their marketing data from customers. Marketing is shown through links with IT and data mining. Loyalty cards can be used to improve brand loyalty, except, perhaps, in the case of Debenham’s. Brand awareness could be considered to be a reaction to the external environment, but it is nonetheless an internal function of effective marketing organization that allows the company to reach its customers in this manner, by paying attention to what they want and what their needs and demands are. Furthermore, the company needs to understand that demographically, the customer base is aligned to a profile according to theories of psychology, and reflects this state in its advertising and marketing tastes. Target marketing is used to pinpoint customers through purchasing trends, such as the link between beer& nappies discovered first by Wal Mart, and the link between low income shoppers& price of margarine. In another example, bananas can be seen as a loss-leader for supermarkets. Companies need to know as much as possible about their customers’ buying habits, and this leads to the integration of information technology (IT) and data mining. “Data mining is, in some ways, an extension of statistics, with a few artificial intelligence and machine learning twists thrown in. Like statistics, data mining is not a business solution, it is just the underlying technology. Statistics does not of itself solve business problems” (Thearling, 2010). Data mining in stores like Wal Mart can be linked to marketing. It is a rule of thumb within the equation facing Wal Mart that the fewer competitors there are in an industry, the more they can take advantage of opportunities and strengths to garner better returns. There are also several other types of entry barriers in this assessment model. One of these types is that of product differentiation. This barrier is more about the consumer than the industry itself, or rather, the consumer’s familiarity with and loyalty to a given brand. This situation may be difficult for many cost-effective and stable supermarket industry and retailing companies to achieve, because in the past they have based performance initiatives on the perception of dealing with change in the external environment while still maintaining a cost-effective internal structure that can be competitive. Companies should work towards establishing a base of customer loyalty that stems from successful customer attention to customer needs, as a large part of the company’s internal strength. “Positioning the store as a brand--through marketing efforts that go beyond the basic concepts of price, convenience and assortment--pulls consumers into the store, the FMI report noted. This kind of positioning, however, requires a top-to-bottom organizational commitment, an emphasis on distinct departments and/or services” (Strong, 2002). It must be realized that it is not always easy to predict and account for changing customer needs. The company needs to strive, making it stronger, because it is not wasting all of its resources on the plan, but instead the strategy. A strategy is more likely than a plan to include elements of concentrating strength against weakness; a plan is more like a neutral framework, rather than a principle of competition that can be combined with business definitions to form a strategy in which the company attacks markets or competitors. A plan is more about remembering that the market leader is going to be interested in pursuing a future that involves increase and expansion of its market share, and therefore has an internal plan that regards setting goals and attempting to achieve them in regards to accomplishing the plan’s directives. Telecommunications/web/wireless Wireless technology means that telecommunications are becoming more accessible geographically, with Web 2.0 and cloud computing leading the way. Wireless cellular phones represent an opportunity in terms of product strategy from a cost-effective standpoint because, “unlike wired service, cellular phones do not require the laying down of costly ground infrastructure, and cellular phone systems are therefore less expensive and quicker to install than wired line phone service.  This is especially relevant in more rural or remote areas where ground infrastructure for wired telephone service is now yet in place” (Smela et al., 1999). Therefore the company’s product strategy should revolve around the provision of cell-phones and cell-phone services in this competitive environment. In other terms of product orientation, the process of reorganizing the company for network security is another issue. In the telecommunications market, there is a lot of competition, and reaching target markets has already been done quite well, while few new alternatives really present themselves. One could argue that solution-based companies should keep a more centralized power structure in its reorganization, but using a more diffuse structure that responds more dynamically to change seems to be working well for many businesses in this industry or sector, so this may also work for the hypothetical company. Overall, the strategy of being an active agent of change seems to be keeping successful companies vital and proactive in their relationships to internal organizational and product planning as well external factors of opportunity in wireless communications. Keeping distribution channels open and flexible is going to be key to the company’s success in entering the wireless communications market. The established competition in the area means that there is going to be a lot of supply-side competition, and the company that is able to get the service to the consumer in the most cost-effective and timely manner is going to wind up on top of this market. This is also going to affect distribution in terms of its ability to reach the target market. Another factor is the changing speed of web and wireless dynamics, as mentioned in above in relation to marketing planning and strategy formation. “Because of shorter product life cycles and faster technological obsolescence, companies are finding that quicker time to market with new products has become a competitive advantage. Although there is little empirical evidence that faster cycle times alone are positively correlated with financial performance, speed clearly has become necessary” (Winer, 2007). Given the proprietary nature of the smart cell pone, this time-to-market may be very important, so that the hypothetical company can keep ahead of the competition and be responsive to change. “Since increased competition, greater customer product knowledge, and slow growth markets tend to cause products to be perceived similarly by customers, it is important to realize that even so called commodities can be differentiated” (Winer, 2007). Product differentiation will definitely be a strong focus in marketing any product and its attendant service within the dynamic and competitive IT and wireless industries. REFERENCE Smela, Soong, and Becker (1999). Cellular Telephony. Telecommunications in Latin America. http://www.zonalatina.com/Zldata294.htm Strong, G (2001). Marketing Matters. New York: Thompson. Thearling, K (2010). Database mining. http://www.thearling.com/text/wp9502/wp9502.htm Winer, R. (2007). Marketing Management. Upper Saddle River, NJ: Pearson Prentice Hall. Read More