Human Activity Directed at Satisfying Needs and Wants through Exchange Processes - Essay Example

Marketing Management Chapter Introduction According to Dr.Philip Kotler, marketing is a "human activity directed at satisfying needs and wants through exchange processes". 1 Brian Norris defines marketing as "The process of repeatedly moving people closer to making a decision to purchase, use, follow, refer, upload, download, obey, reject, conform, become complacent to another person's, society's or organization's value. Simply, if it doesn't facilitate a "sale" then it's not marketing."2 Marketing management the art and science or managing marketing activities. It is a business discipline, which manages an organization's marketing techniques so as to reap benefits of enhanced profits and business growth. Effective marketing management enables an organization to carve a niche for themselves in their domain of service. If an organization has to achieve its business objectives, its marketing manager has to look into the market demand, to determine the feasibility of marketing strategies. The marketing manager is responsible for attuning the level, timing and composition of customer demands to achieve business objectives. On the whole, marketing management all about determining and implementing effective marketing strategies. Marketing strategies are tactics by which an organization gains a competitive edge in the marketplace. Through these strategies an organization determines how to concentrate its resources to achieve, target business objectives. If a marketing strategy has to be effective, it must do research to find out if an organizational opportunity exists in the market in which they want to do business. The factors influencing organizational opportunity are environmental opportunity, distinctive competency and success requirements. Each of these factors is to be looked into during the process of market analysis. Chapter 2. Marketing Analysis Marking analysis is a process which includes the process of ccustomer analysis, company analysis, collaborator analysis, competitor analysis, and analysis of the industry context. These five types of analysis constitute the four C's of marketing analysis and help to answer the following questions: What can an organization do to gain foothold in a market What are the inherent capabilities of an organization and what do they deliver best What are the steps to be taken to gain a competitive edge in the market 2.1 Marketing Research In order to carry out marketing analysis, marketing research must be performed to collect the data required for analysis. Marketing research involved the employment of a variety of techniques. Some techniques of market research are: Qualitative marketing research, such as focus groups - Through Qualitative research, data can be collected from a relatively small group of respondents. This data will not be analyzed using statistical techniques, but its purpose is to help to determine the elements which drive the market on a product, generate a hypothesis on such elements and enable an organization to develop quantitative research designs for determine the feasibility of entry into a particular market. The methods used in this research include in-Depth Interviews, Focus Groups and Projective Techniques. Quantitative marketing research, such as statistical surveys - Quantitative marketing research applies quantitative research techniques, to understand the trends in the current market. The major steps involved in the research process include, definition of the problem of market to be studied, designing the search criteria, collecting data, analyzing the data collected and finally writing a report on what is understood from data gathered. The number of respondents from whom data is collected can range between something like a mere 10 in number to something like 10 million. This kind of marketing research may include a hypothesis on the trends found in the market. Random sampling methods can be used to draw inferences from people, who have provided information. Experimental techniques such as test markets - Experimental research designs enable the collections of market information using controlled testing of causal processes. In this type of research one or more independent variables are manipulated to determine their effect on a dependent variable. For example, if a product has a demand which is caused by factor Y, but after some investigation it is found that there is a factor Z that make X have a demand for Y, then manipulating Z in different ways can result in an increase in the demand. This is what experimental research helps to find out. Observational techniques such as ethnographic (on-site) observation - In observational research, understanding of marketing trends are based on direct observation of the phenomena that causes such trends. Chapter 3. Marketing Strategy The above mentioned forms of marketing research help to understand about the demands of the consumer, the factors, which motivates this demand and the strength of the demand. Today's consumer is an individual who is aware of latest technologies, and tries for find out all information they can before making a purchase. Yet, at the same time they are driven by the age-old human desires and motivations. Marketing strategies should look into both these elements in order to work when they are implemented in the customer segments chosen by the strategy. A customer segment is chosen depending on two factors. The first factor is that the segment provide an opportunity to cater to its demand as it is large, growing, makes frequent purchases, is not price sensitive. The second factor is that the company has adequate resources and capabilities to compete for the segment's business, can provide a better level of service than the competition, and do this in a profitable manner. After obtaining adequate understanding of the customer base, the next step is to determine competitive position in the industry. This will give an answer to the questions 'What Might We Do' and 'What Do We Do Best'. It is the answers to these questions that determine the marketing strategy to be adopted for maximizing the revenues and profits of the firm. It is the marketing strategy which answers the question' What Must We Do' Before the marketing strategy is implemented, the purpose of the strategy selected should be clearly outlined. Such an outline can include the points like the short-term unit margins which have to be optimized, revenue growth, market share, long-term profitability, or other goals. 3.1 Marketing Plan Based on the marketing strategy for the customer segment a marketing plan is adopted. This plan specifies how the company will execute the chosen marketing strategy to achieve its business objectives. The marketing plan will include the following factors: Analysis of the situation at hand based on the data collected during market research and marketing analysis Laying down the company's mission statement or long-term strategic vision The strategy chosen to achieve business objectives, the customer segment chosen and the target to be achieved by the end of a specified period Ways in which the fours P's of marketing will be implemented The financial requirement required to implement the marketing strategy A listing of Metrics, measurements and control processes to ensure quality standards are met with Outline of the risks the company ha to face and some strategies to face these risks The marketing plan implements the chosen marketing strategy and the success of the strategy determines a customer base fro an organization. For example, if the company is selling a product which is simple but mush required product, the marketing strategy should focus on enhancing this need to the consumer. Their decision is likely to be a routine one because the demand for this product is such little effort is involved in making a purchase decision. The marketing strategy should consider these factors. In case of brand products, the marketing strategy should focus on the brand and its worthiness to the consumer, because since the brand name is involved consumers are not likely to consider another brand other than the one which they want. Of the product is a complex one and required the consumer to know a little of the product before making decision, the marketing strategy should focus on how to get his information across to the consumer to induce them to buy the product. The marketing strategy adopted by a company can be any of the following: Undifferentiated or Mass Marketing - In this marketing strategy, the marketer uses a single marketing strategy on one big market.This strategy give the advantage of reducing the development and production costs incurred by an organization because only one product is marketed, it can only be applied in a few markets in which all customers seek the same benefits. This marketing strategy was very popular in the early days of marketing. Ford Model-T are companies which implemented this strategy. In today' marketing scenario, this strategy is not considered to be very viable. Differentiated or Segmentation Marketing - In this strategy the organizations aim at multiple smaller markets, using a unique marketing strategy for each market. Here, the huge single market is broken down into smaller sub-markets and different marketing strategies are implemented to achieve business objective, within each sub-market. Companies that product consumer products such as oil ( hair oil, edible oil), shoes (foot wear, sports shoes) follow this strategy as they offer multiple products within a larger product category. Concentrated or Niche Marketing - Here, a single marketing strategy is applied to one or more very small markets. Thus, this strategy is a combination of the features of mass marketing and segmentation marketing strategies. This strategy is seen to be adopted by smaller marketers, who have identified small segments which are part of a larger segment that is not catered to larger firms. Customized or Micro-Marketing - This is new marketing strategy in which customers are identifies and marketing programs are devise to cater to such customers depending on the needs of the customer. The success of micro-marketing strategy requires that the marketer to allow customers to "build-their-own" products. This approach demands that the marketers possess extensive technical capabilities to reach individual customers and customers must be allowed to interact with the marketer. The chief catalyst behind micro-marketing is the internet companies which learn to utilize the Internet micro-marketing is expected to flourish. Chapter 4. Case Study Any marketing strategy which works has to take a look at the marketing strategies adopted by other companies, which are successful as well as those which have failed, because there are important lessons to be learnt from all this. Let's take an example here. It's been noted that that Companies like Procter & Gamble, Unilever, Xerox, Heinz, Apple and Gillette possess great brands and outstanding brand management competencies, but in recent year, they have failed to generate value for shareholders. This is because they did not consider the economics of the markets in which they operate. As a result, they did not apply their resources where opportunities existed and this prevented from finding and reaching out to new markets and avail more profitable, growth opportunities. Their marketing strategy was only focused on having strong brands to draw sales. Taking another case, if we take a look at companies like Dell and Virgin, they have created shareholder value because, their marketing strategy was designed to focus on the product development based on current market trends and customer relationship management processes. Furthermore, they outsourced most of their supply-chain activities to cut costs. Chapter 5. Conclusion So, what is really the most effective marketing strategy Well the most effective marketing strategy is one which gives answers to the questions 'What Might We Do', 'How Might We Do It' and 'What Must We Do'. Developing such a marketing strategy involves set of five simple steps, which include: Step 1: Finding out the market scenario and market trends-. In other words, find out what's clicking with the people. Step 2: Chalk out the strategy to attract this market Step 3: Build the market plan, outlining each activity involved in detail Step 4: Implementing the marketing plan Step 5: Monitoring the success of the plan What's to be understood by today's business is that, marketing is undergoing tremendous changes because of new technologies, the internet and the chaining demands of people. Now, a business has to contend with factors such as consumer resistance to traditional marketing methods, excessive use of communication channels, and ever-changing laws and legal constraints and therefore must adopt new marketing strategies to survive, grow and expand. Using big-budget advertisements, promotions and product campaigns is not enough. What's important to study the market, the psychology of today's consumer and implement this in the marketing strategy to successfully achieve business objectives. References Philip Kotler, Nancy Lee, Marketing in the Public Sector: A Roadmap for Improved Performance Roger Kerin, Robert Peterson, Strategic Marketing Problems: Cases and Comments, 11th Edition Christopher Lovelock, Jochen Wirtz, Services Marketing, Gerald Albaum, Jesper Strandskov, Edwin Duerr, International Marketing and Export Management, 5th Edition David Jobber, Geoff Lancaster, Selling and Sales Management, Philip Kotler, Kevin Keller, Marketing Management Philip Kotler, Gary Armstrong, Principles of Marketing Warren Keegan, Mark Green, Global Marketing Read More