The Traditional Concept of Implementing Marketing Concept - Coursework Example

Introduction Marketing is gaining new significance with every passing day in the modern business world. Also, the marketing activities are constantly developing new ideas and are moving away from the traditional approach towards new, innovative, and interactive touch. With an aim to focus on the customers, which should be the focal point of the business, the concept of relationship marketing has evolved. Relationship marketing is defined as a strategy to get rid of service intangibility and may be suitable for the services, which are difficult for customers in evaluating after purchase and use. Many firms are doing their business in this category. Personal relationships with customers are very important to build satisfaction (Crosby, & Stephens, 1987). Relationship marketing is an old concept but gained a significant place in the field of marketing. The momentum of its development evolves from the development of services marketing with a focus on quality perspective followed by technological advancements. Traditional merchants did not know the concept of relationship marketing. The emergence of this concept was slower until it was observed that customers should be the focal point of the organization, and they must be considered important even after the purchase is done. Today relationship marketing is considered as a prominent practice for marketing and research purpose. The traditional concept of implementing marketing concept is the process of applying the marketing mix (4 P’s). Although it is universally accepted and implemented, still the model is limited and restricted. According to research conducted in Europe in the domain of service marketing, forms the loopholes in the traditional way, and identify a new definition of marketing. According to the study marketing is not something that what customers want from the company, it is creating value for them. It is the establishment and delivering the long-term customer relationship with customers. This market-oriented approach is less towards specialization and more towards management responsibilities (Grönroos, 1990). Royal national lifeboat institution (RNLI) The Royal National Lifeboat Institution (RNLI) is a charity organization for saving lives at sea. RNLI provides a 24-hour lifeboat and rescue service throughout United Kingdom and Ireland. RNLI is committed to saving lives through their valuable safety measure, lifeguards and most importantly lifeboats (RNLI, 2014a). Since its inception in 1824, the institute has saved more than 140,000 lives as the national institution for the preservation. In 1854, the name of the institution has changed to royal national lifeboat institution. In the same year, lifejackets were first given to their crew. Some previous years have shown tremendous improvement and expansion in this service, with the launch of RNLI lifeguards and lifeboat station in the year 2001. With the purpose of saving lives losses at sea, RNLI is directed by vision of reducing to fullest the losses of precious lives at sea that could have been saved by preventive and safety measures. Moreover, the company RNLI work is built around four values which include providing selfless support to the people in need in the sea in the form of team, always being available for the people who depend on RNLI for the safety of their lives, effectively using donations of the people for developing and strengthening trust and performing courageously with innovative ideas to deal with the changing and challenging environment. The highlight of the organization’s performance for the year 2013 has been as follows: (RNLI, 2014d) Industry and Market Analysis Understanding of the industry landscape is critical for business in order to develop plans of marketing to attract the customers. Understanding of the factors of the industry that have an impact on the organization is important as these factors are beyond the control of the organization. The Ireland’s charity sector is facing tremendous pressure and has to do more with fewer opportunities and resources. The sector is facing problems in bridging the gap between the overall required demands and decreasing income level. The stable political conditions of the UK have direct and positive impact on the organization. The government in UK constantly takes measures to improve the facilities for the effective and better functioning of the charitable organizations. For example, government in UK has removed various bureaucracy related approvals and reduced the requirements list for setting and running and requirement (Gov. UK, 2014). Economically, the charity organizations have to face various factors. As such organizations are widely dependent on the charities; therefore, economic challenges have a direct impact on the level of donations that such organizations receive. According to the statistics from revenue commissioners, there is a 15% decline in charitable amounts from 2009-2011, going side by side with declining government funding in several areas. According to a survey, conducted 60% of the Irish charities have faced a decline since 2009. On the contrary, demand for charitable services has also increased by 60% from the year 2009-2011. The prominent factor of poverty has also increased in over a period of last five years. Figures gathered from Ireland’s central statistics office show a huge figure of 733,000 people categories under the line of poverty. The importance of the sector is evident from the sector’s size that it employees 100,000 people that is 6% of the total population. The sector generates an annual income of €5.5 billion per annum. From the social factors perspective, the retention of the human capital and skills is never a problem for the charity sector. There is a double increase in the number of volunteers since year 2008. Therefore, retention is not a concern in this sector. Another positive aspect of this sector is the recent decision by the federal state, which was proposed in 2009, but, unfortunately, was terminated due to financial resources scarcity. The act was to address some hidden issue in this industry (Brady, 2013). In the context of UK charity industry, 40% of adults were found to do formal voluntary at least once a year in 2009/10. Moreover, 54% had informally volunteered at least once a year. In the year 2008/09, the most-usual reason for doing such voluntary actions is to help people and improve the condition. While the most-common reason for not involving in voluntary services is a lack of free time. In UK because most of the community, voluntary groups are informal, they are difficult to count and hard to recognize it is an estimate that there are 600,000 people that are engaged in charity and voluntary services. (Harker, 2011) There is an increase of 44% in the income of general charities having an income of €35.5 in the year 2008. Voluntary income and charity are increased by 28%. There were 171,074 charities registered in the UK. All these registered charitable firms vary according to sizes and revenue. About 19% of the general charities are categories into social service subsector, and the most-common subsector of education are 18% in the total sector. (Harker, 2011) The figure reveals that social service organizations are more than any other sub sector. As shown in the figure, social service subsector was the largest segment having an annual income of £8.3 billion, which is double in comparison with any other sector. As far as the expenditures is concerned, charitable organizations spent 70% of their income and contributions in charitable activities and 15% on granting funds (Harker, 2011). The growing and ever changing technology also impacts the performance of the charity organization. For example, these organizations are also required to the develop company websites as well a social media presence in the current era of technology to engage and retain charity investors. Charity organizations are aimed at the overall betterment and so for the case; it cannot cost the environment. Charitable organizations remain under constant scrutiny and pressure to ensure that the company operations are contributing in the environment and are not harmful. Charity organizations are also bound to face the legal pressures in their operations. For instance, such organizations are bound by law to approve the financial statement only in case the statement provides comprehensive and trusted view of the surpluses and deficits (RNLI, 2013). SWOT Analysis As Royal National Lifeboat Institution is one of the oldest charitable institutions, and it was founded in 1824 and it has achieved significant importance in the economy, it has numerous advantages, which is turned as its strengths. Some of the main strengths, weaknesses, threats and opportunities within which the RNLI operates are as follows: Strengths RNLI provides a 24-hour lifeboat and rescue services throughout Ireland and UK. This is a competitive advantage for RNLI over others (RNLI, 2014a). RNLI is a charitable institution, registered by federal government of England and Wales. The lifeguards of RNLI patrol over 200 beaches around the region of UK (RNLI, 2014b). The human capital of RNLI is skilled and talented in lifesaving and casualties. The fitness and their ability are evident from the fact that they can swim 200m in under 3.5 minutes and can run around 200m on the sand in just 40 seconds (RNLI, 2014c). RNLI has 236 lifeboats stations, which provide to save lifeboats and continue to search 24-hours. RNLI has a competitive advantage of tax exemption, as all charitable institutions are exempt from it. Weaknesses Non-profit professionals’ usually are more inclined towards job satisfaction especially in small companies. An entrepreneur may not even wish to think for investment on return. The budget problem is always there in the charitable institutions especially when Ireland economy is concerned the rate of contribution has decreased over past years. Opportunities By looking at increasing rate of charitable institutions and contribution, RNLI has a huge potential in the UK market. Therefore, much potential is present in the UK industry. RNLI latest launch of lifeboats around UK and Ireland that are ready to respond 24 hours a day is an opportunity for RNLI to cater a large segment or to enter into new markets (RNLI, 2014c). RNLI can start a new charitable institution as the big image of RNLI can have a positive impact on the new startup even if the venture is of different charitable cause. Threats As RNLI is a charitable institution, sometimes government reduces the amount of charitable funds that they give to a charitable institution. Thus, such government policies can be a threat for RNLI. New small charitable institutions that are increasing in the UK geographical areas are a threat of RNLI as the contribution from public and private sector are always contributed among charities. Thus, the ratio of the charitable contribution given to RNLI will decrease. Anti-NGO approach by media and other sources of publicity may destroy the image of RNLI. Marketing objectives It is very important for an organization to implement and make appropriate marketing objectives for developing a successful and integrated communication plan. The marketing objective of the organization must be specific, i.e., specific, measurable, accurate, reliable and timely. The main purpose of this digital and direct market plan is to sign up 10,000 new members to RNLI shoreline by May 2015 with membership on direct debit. The market of UK has shown an increasing rate of the charitable contribution, however, Ireland has declining rate. Some of the prominent objectives that RNLI has to achieve are as follows: To sign up 10,000 new members to RNLI shoreline by May 2015 with membership on direct debit To increase the charitable contributions by 20% through which they can help people more across the globe by the end of 2015 Target market and segmentation With a specific end goal to make and execute fruitful marketing and correspondence plan, it is critical to first precisely recognize the target market and comprehend the necessities and preferences of this target market (Kotler, 2003). The target market of RNLI for achieving the objectives is as follows: Target market Characteristics and preferences The target market of the whole charitable industry is huge. However, in order to attract new customers that can be a part of target market, the company has to analyze the preferences and characteristics of various segments. According to a survey conducted in 2010, around 30.1 million adults users access internet on a daily basis. The rate has doubled from 2006, which was around 16.5 million. One of the most important sources of digital marketing is social media. Moreover, social media accounted for 12% of the total UK traffic generation. In UK, advertisers generate 85% of the leads through email and online sources. The average time in UK that a person spends daily on the internet is 1 hour and 28 minutes. While the above facts reveal that the UK market are internet users, and the rate of usage is increasing according to the trend. Thus, an effective implementation of digital and direct marketing strategies will obviously help in getting new members. Segmentation and Positioning Based on the offerings that the charitable institution (RNLI) is providing and characteristics that target market should have, the RNLI will target UK Boat owners. UK boat owners who like Sailing, Windsurfing, Power craft and other pleasure craft will be the target market of RNLI. Royal National Lifeboats Institution will position itself as “institution that is committed to saving and prevent life at sea through joining hands." Thus, this positioning will help in RNLI to position perfectly in the minds of the target market and will result in an increase of memberships. Digital & Direct Marketing Strategies Social media and Internet The drive of promotional actives and campaigns are done through social media. According to the statistics, 70% of small-medium businesses are engaged in social media in UK for marketing purposes. Moreover, 88% of all marketers believes that social media helps them to get more exposure. Thus, people will be allowed to discuss and ask queries concerning the institution and memberships and engage through different interactive discussions. This on one hand will boost the revenue of the Royal National Lifeboats Institution and in the meantime will expand the business mindfulness through social networking advertising and informal word of mouth marketing. Alongside this web ads and distinctive online networking presence will additionally be utilized to increase the awareness of RNLI offerings and value to wide gathering of individuals, for the duration of the time of the correspondence plan. Apart from these destinations, online social networking will likewise help in giving the clients reliable and latest information with respect to the new offers and membership details with the good causes they are engaged in. The utilization of online networking will most likely affect the purchasing conduct. Accordingly, the traffic over the Facebook page will essentially expand, along these lines prompting the upgrade of awareness and incomes. Promotional Campaigns The advertising and marketing initiatives will begin by a wide promotional campaign. The institute will visit distinctive institutions which are engage in Sailing, Windsurfing, Power craft and other pleasure craft in UK and will set up diverse corners and stands for pushing the memberships of Royal National Lifeboats Institute. This will give a chance to the institute to specifically collaborate with the youth, which is the biggest target market for any industry in UK. These promotional campaigns will run from time to time according to the need and potential. Corporate Sales Corporate customers are always potential and key player in the success of an organization. To get a rich amount of new members RNLI has to target the corporate clients too. For that, direct marketing channels will be used like direct email. Moreover, telephone marketing will be used to give information about incentive and discount, which RNLI is offering. Thus, the benefit will help the Royal National Lifeboats Institution to attract the cooperate customers. The corporate clients are potential customers. Moreover, the entrepreneurs are usually big philanthropists. Therefore, RNLI can have a huge amount of charitable funds from them. Television & Digital Newspapers Along with the social media, campaign the institution will also communicate through television and newspapers that people see on a daily basis. Different TV’s and newspapers will be the focus in order to increase the awareness about the membership along with their incentive attached to it. The advertisement will be focused towards saving lives at sea and awareness that their small contribution will lead to huge life savings. Product/Special Offers & Incentives  The memberships of RNLI are of various types, each has distinctive offers and features. The different types of memberships that RNLI offer to its members are as follows: Actual Membership Fees Features Special Offer Fees £28/€40 per year or £2.33 a month The most popular and mostly liked membership of RNLI includes the lifeboat magazine, which consists of 52 pages with rescue stories and offers that are available for members. Moreover, it also includes Invitation to the Annual presentation awards. £24/£36 per year or £1.99 a month £50/€70 per year or £4.17 a month The membership includes the lifeboat magazine, which consists of 52 pages with rescue stories and offers that are available for members. Moreover, it also includes Invitation to the Annual presentation awards event. £44/€64 per year or £3.99 a month £68/€98 per year or £5.67 a month The membership includes the lifeboat magazine, which consists of 52 pages with rescue stories and offers that are available for members. Moreover, it also includes Invitation to the Annual presentation awards and offshore magazine. The boat stickers are also included to the members spread out the word. £60/€90 per year or £5.01 a month £86/€125 per year or £7.17 a month The membership includes the voting rights in the annual meeting to build the future of RNLI. It also includes lifeboat magazine, which consists of 52 pages with rescue stories and offers that are available for members. Moreover, it also includes Invitation to the Annual presentation awards and offshore magazine. The boat stickers are also included to the members spread out the word. £76/€115 per year or £6.85 a month £7.50/€10.50 per year This membership is aimed at introducing a child to the wonderful and exciting land of lifeboats and lifeguards. Membership includes storm force magazine, membership pack and a membership card with a new badge. Access to the “storm force crew room” is an effective way of attracting children. £5.50/€8.50 per year Database Strategy The secret behind high growth and demand is to collect valuable data of clients like name, contact number, company, preferences, etc. The database strategy that RNLI will follow in order to reach its objective are as follows: Strategy Purpose Target When Compass Newsletter Enhance the relationship and generate a level of interest in the range of membership RNLI will offer. Thus, it can also be beneficial in terms of promoting through word of mouth. Clients Monthly Basis Welcome emails Add rich experience to a new client and provide them to understand the institution in an effective way. New clients Weekly till 6 months of membership. Sales Promotion Add a membership in the existing customer base and help to get more funds. New clients On weekly basis Marketing Survey Evaluate the preference and test the new services. Clients/ New Clients On annual basis Video To capture a new market by showing them videos of how RNLI works and how one can help in this good cause, RNLI can send online videos to the new clients. New Clients Weekly Basis Budget & Resource Allocation In order to execute this direct and digital marketing campaign, RNLI has to allocate a budget to specific budgets in each activity. Effective budget allocation will help the company to analyze the effectiveness of the marketing campaign (Kotler, Armstrong, Wong, and Saunders, 2008). RNLI has allocated the resources in different activities, which are as follows: Direct & Digital Marketing Channels Budget Allocated (%) Social Media 15% Promotional Activities 30% Corporate Sales (Direct Marketing) 20% Television and Digital Media 35% CONCLUSION The above direct and digital marketing plan has been formulated for Royal National Lifeboat Institution. The charitable industry of Ireland is facing decline in charitable contributions, however, an increasing rate has been observed in the UK industry. To achieve a high number of memberships, RNLI is looking for new digital and direct marketing channels to achieve the objective of signing up 10,000. The plan is focused on increasing the memberships through different offers and incentives. The plan will help the Royal National Lifeboat Institution to achieve its objective in an effective manner. References Brady, N. (2013). Irish charities find the going gets tougher. The Guardian, Available from http://www.theguardian.com/voluntary-sector-network/2013/mar/05/charity-sector-ireland [Accessed 12th August, 2014] Crosby, L. A., & Stephens, N. (1987). Effects of relationship marketing on satisfaction, retention, and prices in the life insurance industry. Journal of marketing research, pp. 404-411. Gov. UK. (2014). Making it easier to set up and run a charity, social enterprise, or voluntary organization. Available from https://www.gov.uk/government/policies/making-it-easier-to-set-up-and-run-a-charity-social-enterprise-or-voluntary-organisation [Accessed 12th August, 2014] Grönroos, C. (1990). Marketing redefined. Management decision, vol. 28, no. 8. Harker, R. (2011). Voluntary sector statistics. The House of Commons, Available from http://www.parliament.uk/Templates/BriefingPapers/Pages/BPPdfDownload.aspx?bp-id=sn05428 [Accessed 12th August, 2014] Kotler P., Armstrong, G.,Wong, V. and Saunders, J. (2008). Principles of Marketing (5th European Ed.). London: FT Prentice Hall Kotler, P. (2003). Marketing Management. Upper Saddle River NJ: Prentice Hall. RNLI. (2013). Annual Report. Available from http://rnli.org/aboutus/aboutthernli/Documents/annual-report-13.pdf [Accessed 12th August, 2014] RNLI. (2014a). About us. Available from http://rnli.org/aboutus/Pages/About-us-new.aspx [Accessed 12th August, 2014] RNLI. (2014b). About lifeguards and the lifeguard service. Available from http://rnli.org/aboutus/lifeguardsandbeaches/Pages/Lifeguards.aspx [Accessed 12th August, 2014] RNLI. (2014c). Latest lifeboat launches. Available from http://rnli.org/latestlaunches/Pages/latestlaunches.aspx [Accessed 12th August, 2014] RNLI. (2014d). Review of the year 2013. Available from http://rnli.org/aboutus/aboutthernli/Pages/review-of-the-year.aspx [Accessed 12th August, 2014] Read More