Marketing Communications. Dramatic changes - Essay Example

1.0 Introduction Perhaps no area of marketing has seen more dramatic changes over the years than marketing communication (Keller 2001:819).Today, with increasing globalisation, and the increasingly development of new technologies, numerous marketing communication options have become available to marketers. Keller (2001:819) refers to marketing communication as the means by which firms attempt to inform, persuade, incite, and remind consumers directly or indirectly about the brands they sell. Marketing is a concept that focuses on meeting customer wants and needs. To be able to satisfy customer's wants and needs it is necessary to consider the marketing mix of the product or service the company is providing. The marketing mix involves four marketing strategy areas, namely product, price, promotion (The marketing communication and place). In marketing, the "four PS" determine how a product is made or a service provided, how much it costs, where it is distributed and how it is presented in all company's communication. Keller (2001) contends that, the role of marketing communication in modern business practices has been identified as a key factor in survival in modern day business. Companies like Sony, Tesco, Volvo, BMW, McDonald and a host of others have increasingly used the four Ps as a competitive weapon. As part of the search for business effectiveness the entire process of marketing communication is being approached in a comprehensive and unified manner where by all activities of business communication functions in unison. This approach is called Integrated Marketing Communication. This is a relatively new concept in management. It is engineered to harness all aspects of marketing communication such as advertising, promotion of sales, public relation, and direct marketing in a highly focused manner eschewing the former tendency of these departments to function in isolation. Competitiveness in business the world over is so acute that survival is possible for only those organizations, which are ready to employ every possible means to increase profit by reducing cost in production, while remaining uncompromising in quality and aggressive in marketing. The account of the phenomenon of Integrated Marketing Communication by Aaker, Batra & Myers (1992) constitutes a fair working explanation of the phenomenon Having said this so far, in the remaining part of the paper, using Sony as a product and at the same time a company I will outline the key characteristic of the target audience, the communication strategies used with the impact of its marketing strategies. 1.1 Sony and the Four Ps I have chosen Sony as my institution under case study. Focusing on Sony is based on a number of important advantages. Sony is a global leader in the electronic industry, it activities have been benefited in almost all the continents. "The influence of words over men is astounding." -- Napoleon. As the whole world gears for peace, marketers and other business people talk in terms of war. We see battle words everywhere in business: Japan bashing, corporate raiders, hostile takeovers, cola wars. Marketing is war (Duncan 2001). With the advent of events, ordinary business executive fancy themselves as warriors. Aggressively attacking weak companies, and defending market shares. Positioning products in people's minds and making them attractive to market segments requires careful formulation of the marketing mix. Getting the right blend of the product, promotion price and distribution is essential to put the carefully carried out analysis into operation. The aim is to portray an image for the product or service that will match with how one wants the product to be visualized in people's mine (Keller 2001, Duncan 2001) Table 1:A summary of what constitute each of the Ps of the 4Ps Product Tangible products Psychological attributes Quality Services Benefits and features Packaging Styling Image Branding Customer service After care Guarantees Image Pricing Selling price Price positioning Distributor margins Credit Discounts Payment methods Price promotions Discriminatory and variable pricing Promotion Advertising Web sites Direct marketing - including email as well as direct mail and telephone marketing Public relations (PR) and publicity Personal selling Sales promotion Placement Channels of distribution Service levels Logistics Channel segmentation 1.1.1 Sony and the "Product" Packaging should be most important component of the product as a communicating device. As shoppers wander the aisles and scan shelves looking for that benefit, image, or value communicated by each product's design, packaging, price, and place, products which are not on the shelves, or are shelved inadequately, or i priced too high or low, or is unclearly packaged or labeled are put off the shopping basket of the client. With this in mine, the management of Sony has successfully incorporated in their various products and services starting from Sony electronics, Sony Games, Sony Movies and Music to Sony financial services. For example, the one of the actual product of Sony, the Sony Camcorder is use for video recording, snapping pictures, video conferencing is the benefit (core product) being offered by the physical product the Sony Camcorder. This benefit is also being reflected in the quality of Sony products, for example the quality of Sony play station 3. The name Sony is a powerful brand name. This is reflected in the design, aesthetic, or ergonomic aspects of its electronics, videos, movies and music. This refers to as styling. Sony products have the same style, features and characteristics that help consumers get value for their money. With this, all products are being position and identify under the brand name "Sony." Sony Play Station 3, Sony DVD, Sony CD player etc. To gain the loyalty of the customers, all purchases of Sony items are covered by warranties, free installation and delivery with after sales services. There is an option being offered by Sony, for customers to log online and diagnose common problems. These are all measures taken by the management of Sony to help the consumer put the actual product to sustained use. These measures have been used successfully as a competitive weapon, a strategy for a new product launch. Electronics Cameras Television DVD Recorder others Games Sony play station3 Movies & Music All chain of movies Financial Services Sony credit facilities 1.1.2 Sony and the "Price" Basically, all the other three Ps are cost. Price is revenue. This is the nightmare on the head of the management of any big organisation. Are we charging the right price What will be the effect should a loophole be created on our prices How and who are our prospective customers and customers. Sony, one of the market leader, and a key market player in the electronic market has segmented the market so well with it product line pricing techniques. An illustration is made using the Sony, Digital compact cameras - Cyber-shot. The management of Sony in this product developed a product line rather than a single product. From basic model DSC-W100 priced at about $45 to a more advanced functional digital camera with different features DSC-H7 of about $1200. Other compact cameras within the price line include: DSC-H9 , DSC-H3 , DSC-T200 , DSC-T100 , DSC-T70HDPR , DSC-T70 , DSC-T20 , DSC-T2, DSC-G1, DSC-N2, DSC-W200 , DSC-W80 , DSC-W55 , DSC-W35 , DSC-S650 etc. Each successive product in the line offers more features, with the features carefully fitted to lure consumers, taking those of competitors and related product into consideration. To avoid "trade up" the price difference between one product and the other is made to match the features and functionality e.g. DSC-W35 is priced at $285 while DSC-S650 is priced at $235. The management of Sony has effectively used what is referred to as captive product pricing. Sony non digital cameras are often sold at give away prices, while there is usually mark up prices for the films. Thus money is made on the films sold subsequently. Sony flash lamps for specific cameras, projectors unique to certain television serve as an example. As a product of Sony moves through the distribution channels, e.g. from manufacturer to distributor to dealer to customer, there are prices set along the way. It is cheaper to buy directly from Sony stores over the internet than through a distributor. Thus, to make sure the end price being offered by the distributor is competitive enough, distributors cost are accounted for, with Sony stating the final price to the consumer. Sony often uses price skimming when launching a new product. Being a market leader this strategy is employed once a new product is launch, with the price set very high and gradually being adjusted with other competitors stepping in. This is the premium and over charging strategy. The present Sony Bravia television serves as a good example. Other pricing strategy successfully used by Sony include, seasonal discount, sales promotion in trade fares, sales on credit and variable pricing. 1.1.3 Sony and the "Place" Place includes all Sony company activities involved in making the product available to target consumers. It includes: Sony channels of distribution, the extent of its market coverage, managing discrepancies of quantity and assortment, its retail locations, and the management of inventory, its transportation, and its logistics. Sony has offices in North America, Latin America, Africa, Europe, Asia, Oceania etc. With it head office located in Japan all these locations have Sony wholesales stores, retail outlet, a packaging or manufacturing facility, Sony distributors, Sony retailers and a team of experts and technician to follow up customers query. These networks of middlemen along the way are, in essence, in partnership with Sony to sell Sony products and services to the end-user. Though the use of distribution specialists results in greater efficiency, this mean management has turn over part of the selling function to intermediaries the by, giving up some control of how, and to whom, products are sold. It is advantageous to Sony, in that Through contact, experience, specialisation and scale of operations intermediaries usually offer the firm more than it can achieve on its own. To make the best use of the four Ps, and create as much value as possible for its shareholders, Sony currently make use of four channels of distribution. Sony does direct marketing to its client with sales coordinated over the internet with the area of operations web page. Another channel of distribution used by Sony is that of a single intermediary. Here, Sony uses big stores like Tesco Plc, Asda Supermarket, Wal-Mart and Sears, which then sell the goods to final consumers. Some retail stores and outlet are run under the company logo and brand name. Sony has retail stores in most of its location selling only the company items. In some instances, it uses its own sales force to sell directly to business customers and some industrial distributors who sell to business customers. These networks and channels are connected by physical flow of products, the flow of ownership, the payment flow, the information flow, and the promotion flow. Distribution channels are not limited to the distribution of physical goods. Producers of services and ideas also face the problem of making their output available to target populations. In the private sector, department stores, hotels, banks, and other service providers take great care to place their outlets in locations convenient to target customers. Who is the final consumer or user of Sony product Where does a prospective customer look when buying Sony type product If she buys this product from an office products retail store, then where does that retailer obtain his products Once the Management of Sony have identified the channels, it is easier to determine which ones make the most sense or which ones offer the path of least resistance. Thus, we see that, through it product segmentation, product range and product line, market segmentation has been implemented in both Sony product and services. Sony improvements in information technology have created opportunities for major gains in distribution efficiency. Computers, point-of-sale scanners, uniform product codes (UPC's), satellite tracking, electronic data interchange (EDI), and electronic funds transfer (EDF) have allowed Sony to create advanced systems for order processing, inventory control, and transportation routing and scheduling. 1.1.4 Sony and the "Promotion" "For customers to entertain a purchase, you must first entertain them." That's a fair deal (Soares J.E 1991). A promotional feat is a feat only because it entertains. The entertainment aspect is causally instrumental in persuading a prospect to try or buy your product. The trick making the product so appealing that people goes out of their way to watch, and exchange their cash for this product. Thus, these processes have been followed closely by Sony through the promotional mix. Specific media tools used being used by Sony, include print (magazines, newspapers, direct mail), broadcast (television, radio), and display (billboards, signs, posters) and in some countries special channels are reserved for marketing Sony products. Sony uses the internet as an effective tool for communicating with customers. In addition to enhancing the content of its website, which include product related news and frequently asked questions, the websites offers download of manuals and provide prompt information about product and services. Operator's advice to personal computer users while remotely monitoring their screen over the internet. Web malfunctions diagnosis services which enable customer to diagnose what is wrong with their television. These tools are intended to convey a consistent, enduring image that continually reinforces the positioning of Sony. Sales promotional tools such as "Buy me now" "Buy me and pay monthly" discount, out of season offers have been effectively been used by most of Sony's stores. The effect is "short-term," as most sales promotions have a finite time frame when the terms of the offer are in force. However, interest is being spark in the product or services being promoted. Personal sales staffs are used in big events such as trade fares, Olympic games, football matches etc. Sony sales force and trade promotion through the above mention methods "push" the product through the channel of distribution.Sony promotes the product to wholesalers, wholesalers to retailers, and retailers to the end user. This is the push strategy. A television campaign will however cover the entire circle and channels. "Promotion can take many forms: advertising in various media, events, press releases, trade shows, brochures, flyers, and internet sites to name a few. Promotion means to create awareness although awareness is just the beginning. Good promotion compels the buyer to buy". The "need" for the product must be addressed. How does it solve the customer's needs (even needs he doesn't know he has) Marketing communication is a collective term for all the communication functions used in marketing a product (Duncan 2002:15) Each marketing communication functions has a unique strength and companies and agency are finding more and better ways to use these functions strategically (Duncan 2002:16.). At Sony, promotional decisions needs to be made about advertising, direct marketing, interactive marketing, sales promotion, publicity and public relations and personal selling. Most of these functions have been used for about a hundred years and so individually they are not new. The concept are not new but what is new is managing them in an integrated fashion. 1.6 Marketing Fragmentation target market and Audience Recent shift and development in the business world in general and marketing in particular has pushed the marketing strategy from mass marketing to target or one-on-one marketing and narrowcasting (Simmons., 2007, Schultz and Schultz., 1998, Varey., 2001). Advances in information technology have further made things complicated for companies as they strive to embrace it (Philip K., & Patrick P., 2003).E-communications is increasingly becoming a vital part of the marketing communication mixes as the "Wait & See" are now embracing it. The promotion element involves communication, and one type of communication is advertising. The advertising strategy combines the elements of a creative mix. This mix includes the target audience, product concept, communications media, and the advertising message. The target audience, for Sony console is the youth age 8 to 21; Sony Bravia is the rich etc. In order to create an effective advertising message, it is important for the management of Sony to know who are their target audience. The target audience at Sony includes the end-user, the person who makes the purchase, and the one who influences the purchasing decision. For instance, Sony's target audience is made up of children and their parents. The children influences their parent's purchasing decision. Therefore, Sony's advertising message for the game console is directed toward the children, as well as their parents. According to Kortler (2002), the process of determining who your target audience is begins with segmenting the consumer market; finding the right niche. This process begins with identifying groups of people with certain shared characteristics within a broad market. The categories of characteristics are geographic, demographic, behavioristic, and psychographic (Kortler 2002). From these segments, choose your target market. Your target audience includes your target market. The target market in the previous Sony's example is the person(s) who makes the purchase. Target audience is larger than the target market. The characteristics for the target audience include, their age structure, salary structure, life style It components and supplementary tools ranges from online advertising & promotions, email-direct marketing, brand websites and wireless advertising. These techniques can build awareness, improve brand &attitude, stimulate trial and stimulate customer's relationship management (CRM) (Kortler P., & Pelsmacher P., 2003, Flaherty & III Clarke 2005). Kortler. & Pelsmacher. (2003) argued that, their inherent interactivity in the new media gives them a unique place in the integrated marketing mix. Though, the primary role of e-marketing communications in integrated marketing communication is to give integrated marketing a strategic fit to embrace the ever increasing challenges in today's global environment, it should be implemented with caution. Kortler (2002) argued that as marketers and marketing companies move and adopt richer but more fragmented media and promotional mixes to reach diverse markets, they risk creating a communication hodgepodge for consumers. One way of preventing this from happening is by adopting the concept of integrated marketing communication which calls for integrating sources and features of a company's communication in one shot. E-communication also pave the way of integrating positive emotional appeals as love, pride, joy, and humour. Advocates for humourous messages claim that by doing so consumers develop more liking and belief in the products (Mark. J., 2000) 2.1 Conclusion and Recommendation Creative marketing people will come up with events and techniques that will leave lasting impressions. The marketing mix, the 4 P's is the marketing "mix" of every brand and company. Sony should strive at controlling the 4P's known to be the "independent" variables. The dependent variable is sales volume. Thus the right mix should give the best sales volume. This can be possible through "Product Space Map". The management of Sony however needs to consider using techniques such as above the line activity. Like integrated marketing communication, this kind of activity include broadcast and print advertising where an agency is paid on commission based on the media space bought. By using the technique, it is easy for the company to breakthrough competitors existing customers (Attitude). What consumers think about Sony How the consumers feel about Sony How consumers have been reacting towards the Sony's products and who are those competitors. By using such a technique, Sony with its current strategy markets of attacking virgin markets will be able to address consumer's negative perception about some of its products. Such an action also, will help counter early post purchase dissatisfaction experience by customers may be done through television advertising. Changing the way customers think and feel about a product requires emotional messages to appeal to consumers and increase their likeability for the brand. Their integration marketing strategy should be redesign to ensure that both trust and commitment can be developed and maintained and that there is a level of interdependence between the channel members, which means that an action by Sony will impact all the channel members. Integration of a company's marketing communication activities can avoid confusion and disaffection in the minds of consumers and buyers, offering a comfortable identity to customers and staff and give the brand a positive image. (Kotler. 2005). Schultz et al. (1993, 1998) postulated that any model of marketing communication should analyse what happens with the customer rather than starting with the marketer. By doing so, the communication mix is developed on the basis of (actual, 'natural') customer activity in relation to the brand and not (necessary) marketer activity in relation to the brand. This is the secret behind Nike, McDonalds marketing mix and other leading brands. The company and suppliers can jointly invest in a common database which is more appealing and supporting to more support functions. Electronic commerce could boost sales, as it is a convenient way of purchasing and could also provide the ambiance of providing all the services and goods under one roof. Such a step towards technology could improve customer satisfaction and bring about additional revenues from satisfied clients. Competing in the right way in the right arena can be extremely profitable, but only for a limited time. The core competencies of the corporation, which are the basis of competition, provide the foundation of a sustainable competitive advantage and long term performance. Bravia is a core product for Sony. Unless there is an advantage over competitors that is not easily duplicated or countered, long term performance is likely to be elusive (Aaker, 1989, p. 91). Sony Bravia is a competitive product. I will highly recommend Sony to continuously take the lead in new product development, innovation, technology and collaborate with other partners and competitors when entering new markets. Managing a company's brand is a complex and complicated issue that needs to be thought of in terms of how feasible and applicable is it in relation to the resources and capability of the organisation All too often, Kortler (2003) further argued that, companies fail to integrate their various communication channels. The result is a hodgepodge of catastrophe to consumers. "Mass advertisement says one thing, price promotion sends a different signal, and a product label creates still another message. Company's sales literature says another thing all together, with the webpage at the other end". Marketers should be alert, and present this in one shot to the consumers. One weakness about integrated marketing is that, it has the potential of pushing both poor and good product through the launching stage of a product. However, for the poorly produced product, it wouldn't take long for buyers to know the truth. Kortler (2002) postulated that, the more quickly potential buyers learn of a new product, the more quickly they become aware of its fault. Thus, integrated marketing will call for good deeds followed by good words (Kortler. 2002). In all, an integration of E-communication into integrated marketing facilitates challenges in contemporary businesses. Which include:- Growth in advertising and promotion. The emergence of the global consumer The development and importance of integrated marketing communication Direct marketing (using local rather than mass media) as a new promotional tool in targeting the likeliest customers for the particular brand. Process-oriented coordination and control (Varey, 2001) Creative marketing people will come up with events and techniques that will leave lasting impressions. The marketing mix, the 4 P's is the marketing "mix" of every company. The company should strive at controlling the 4P's known to be the "independent" variables. The dependent variable is sales volume. Thus the right mix should give the best sales volume. This can be possible through "Product Space Map References Aaker, David A., Rajeev Batra , and John G. Myers. Advertising Management, 4th Ed. Englewood Cliffs, NJ: Simon & Schuster, 1992 Belch, GE & Belch, MA.(2001). 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