A Managerial Approach to Marketing - Essay Example

Competitive pressures abound in today’s dynamics product marketing system. The market is essentially saturated, dependent on a growing population as well as a declining share of consumer income spent on purchases. Companies are using many strategies to compete for a larger share of the pie, including new ways of conducting business mergers and acquisitions, overseas expansion, and state-of-the-art technology. To meet consumer preferences and remain competitive and companies have introduced a wide variety of new products. Also, there are a number of unique items (according to brand, package size, and type) stocked by various outlets. Competitive pressures to deliver specific products to meet consumer demand have changed the way the products move from the producer to the consumer. Any company has to adopt new marketing strategies in order for it to survive in the ever competing environment. The marketing landscape has shifted in that technological innovation, new channels, regulatory compliance, bottom-line accountability and rising customer expectations are altering the playing field. Marketing managers are unraveling these complexities in order to spearhead initiatives that capitalize on the customer-driven market place. It is important to place the customer at the core of strategic decision making hence marketing managers can better align marketing resources, spend, mix and technology investments. Strategy and technology can then coalesce to profitably meet customers’ needs, which enhance brand performance, increase customer value and position the enterprise for growth capability of outpacing competitors. This strategic brief addresses central issues on the minds of today’s marketing managers. A Managerial Approach to Marketing As technology advances and consumers gain clout, traditional batch and blast marketing approaches designed to maximize new customer acquisition without regard for customer needs and long-term value will under perform. Launching marketing programs around new products for short-term revenue wins will not be enough to sustain returns and surpass competitors. Technological innovations are constantly altering the playing field. Analytical solutions are bringing new levels of customer intelligence, allowing marketers to understand individual customer needs. Technological innovations are constantly altering the playing field. Analytic solutions are bringing new levels of customer intelligence, allowing marketers to understand individual customer needs. Optimization tools have increased marketing velocity and shortened cycle times. Consolidated, clean customer data stores can be matched with event-based campaign management tools to improve message accuracy, timeliness and relevancy. As technologies come to the forefront, alternate channels and increased competition come with them. Marketing over the Web, email, telemarketing, direct mail, and fax, instant messaging and wireless text messaging is increasingly refined and individually relevant. Highway billboards, for example, can be programmed to change their ads based on a demographic analysis of the radio stations selected by passing drivers. The rate of technology adoption is also gaining speed. Technology is a double-edged sword. At one level, consumers have a proliferation of choice. They have instant access to competitor pricing, product and service information across a number of mediums. At the same time, progressive marketing managers are actively utilizing new technologies to collect relevant data from multiple sources (e.g., campaign metrics, channel usage and performance, customer satisfaction levels) and implement effective marketing strategies driven by more fact-based decisions. The results are efficient management of contact opportunities and the ability to provide ongoing value to the prospect, customer and enterprise. Marketing does not exist in a vacuum. To improve business performance and create sustainable, profitable growth, marketing must be integrated with sales and service programs. Great marketing is no accident. A marketing capability that drives real business performance and organic growth is complex, pervasive and sustained over time. Finally, marketing must be measurable—not only the impact of current investment, but also the probable outcomes from potential future investments. Major Trends and Forces Changing the Marketing Landscape Marketing landscape is rapidly changing and on so many levels. There are major treads and forces that cause this rapid change. Most significantly, media fragmentation, particularly of TV, and information saturation make it increasingly difficult to connect with consumers, prompting some marketers to seek better-targeted and more effective solutions than the old mass-marketing techniques. Demographic changes are forcing smart marketers to change. A generation, Gen X, of hugely cynical buyers is reaching maturation. This generation has different tastes and completely different media habits from its parents. They are more likely, for example, to glean information from the Internet than from newspapers. They tend to consume media simultaneously, more so than their parents and parents parents. They appear – according to Advertising Age surveys – to be less perturbed than their parents about content that are paid for, their key criterion being that the content is compelling, and not that it is produced independently of commercial interest. They do not want to be taken for fools, but they accept commercialism. Reaching them requires a new mindset. So, marketers have become more attentive to the idea they should create certain products for certain segments and market them in a similar way. Marketing landscape changes depending on the different companies and sectors. For instance, Procter & Gamble is diversifying its marketing strategies. They are focusing more on direct-to-consumer activities: direct marketing, interactive in-store activities, PR for consumers, etc. They are using all the tools included in the marketing mix in a more balanced way. Some years ago, the ad campaigns were the "stars." But now, companies are more conscious about the power of the marketing mix to reach and convince consumers in a more effective and credible way. Additionally, they are looking for the key influencers, to "use" them as opinion leaders, especially in PR. On the other hand, there are still companies basing their strategies mainly on advertising with a focus on TV. Marketing landscaping is evolving yet the idea that PR and marketing have recently "discovered" each other stems from a poor understanding of our common heritage. PR people generally have no clue about the modern origins of the field, and "marketing" types are even less familiar with the territory. We could make ourselves more valuable to marketers by better understanding our own field – and they could make more effective use of their PR investment by better understanding the discipline. Everything has changed and marketing is no exception. Over the last five years, the most influential changes have been the most documented – the rise of the Internet; the cynical, empowered consumer; and the fragmentation of the media. But one of the most interesting changes affecting marketing is the rise of the niche brand. An increasingly wealthy and vocal minority of consumers has emerged who actively seek to avoid the big brands, preferring to choose something with branding of a more cottage-industry nature. It can be construed as a reaction against globalization, and has been most prevalent certainly in Europe. The drinks brand Innocent is a good example of this. Smart marketers are "balancing" their marketing portfolio the way a fund manager balances stocks – the right mix for the right time. Right now, credibility with key audiences is at the top of the list, so some clients are rebalancing the marketing mix to deliver on credibility. More than ever, marketers are scrutinizing the results of each line item in the marketing mix. Its a trickle down from the omnipresent focus on corporate accountability. PR can deliver high value that other marketing vehicles cannot – editorial coverage, credibility and a strong connection to influencers. Marketers in recent years certainly have realized the value of PR. But advertising still has a definite role to play. The recession hasnt resulted in marketers switching their ad budgets into PR, contrary to the hopes of some in the PR world. If marketers have trouble working out the split of their budget between the various marketing disciplines – and undoubtedly its a tough issue – its because reliable enough ways still dont exist to measure the effectiveness of PR versus advertising, direct marketing or all the other techniques. Key Elements of Customer-Driven Marketing Strategies Customers these days seem to be most interested in creative ideas that have bulletproof execution. There is great comfort in knowing an idea is doable and will generate the anticipated results and be creative at the same time. Weve seen our entertainment marketing group really grow over the last few years. There is more interest in finding ways to incorporate brands into the world of entertainment – an area of great interest to the majority of the population. We also have noticed changes in the use of sponsorships. While customers are still interested in this area, we have also found that they are looking for the connections to be stronger between the activity they are sponsoring and the brand they are selling. One of the most significant changes reflects interest in the diffusion – word-of-mouth –campaigns via public relations. Clients realize that identifying the right influencers and opinion leaders are key to provoke positive word of mouth among consumers. This is the reason why many clients are more interested than ever that influencer programs be included in their PR activities. All of these are happening, although ethnic marketing is more of an issue in the U.S., because of the greater numbers of discrete ethnic groups. Marketing via text message has become hot in the UK over the past year or two. Marketers are still experimenting with what is acceptable to consumers on this front – its easy to annoy them with the wrong style of message at the wrong time. In Brand Marketing, customers most often are brand managers and marketing communications staffers. Typically, they are well versed in advertising because it is part of the MBA curriculum. PR isnt part of their educational foundation so its often up to the internal communications staff or us to educate brands about the value of PR. Many times, once a brand manager experiences PR, they are repeat users. We must demonstrate that PR isnt the last option in a marketing plan; that it at least carries the same weight as the rest of the tools. Case studies and results are very useful to illustrate our capabilities and experiences. For marketing clients, we need to make a quick, clear case for including PR in their arsenal. Our efforts to show a return on investment are a good step, and from there we need to show examples of how easily PR can fit into their broader communications effort. Ease of use might be as important as return on investment. Marketing Management Orientations that Guide Marketing Strategies Marketing management is the art and science of choosing target markets and getting, keeping and growing customers through creating, delivering, and communicating superior customer value. The implication of this definition is that any activity or resource the firm uses to acquire customers and manage the companys relationships with them is within the purview marketing management. Many businesses operate with a much more limited definition of marketing, such statements can appear controversial, or even ludicrous to some business executives. This is especially true in those companies where the marketing department is responsible for little more than developing sales brochures and executing advertising campaigns. Marketing management encompasses a wide variety of functions and activities, although the marketing department itself may be responsible for only a subset of these. Regardless of the organizational unit of the firm responsible for managing them, marketing management functions and activities include: Marketing Research and Analysis In order to make fact-based decisions regarding marketing strategy and design effective, cost-efficient implementation programs, and firms must possess a detailed, objective understanding of their own business and the market in which they operate. In analyzing these issues, the discipline of marketing management often overlaps with the related discipline of strategic planning. Marketing Strategy Once the company has obtained an adequate understanding of the customer base and its own competitive position in the industry, marketing managers are able to make key strategic decisions and develop a marketing strategy designed to maximize the revenues and profits of the firm. The selected strategy may aim for any of a variety of specific objectives, including optimizing short-term unit margins, revenue growth, market share, long-term profitability, or other goals. To achieve the desired objectives, marketers typically identify one or more target customer segments which they intend to pursue Implementation Planning After the firms strategic objectives have been identified, the target market selected, and the desired positioning for the company, product or brand has been determined, marketing managers’ focus on how to best implement the chosen strategy. Traditionally, this has involved implementation planning across the "4Ps" of marketing: Product management, Pricing, Place (i.e. sales and distribution channels), and Promotion. Project, Process, and Vendor Management Once the key implementation initiatives have been identified, marketing managers work to oversee the execution of the marketing plan. Marketing executives may therefore manage any number of specific projects, such as sales force management initiatives, product development efforts, channel marketing programs and the execution of public relations and advertising campaigns. Marketers use a variety of project management techniques to ensure projects achieve their objectives while keeping to established schedules and budgets. Organizational Management and Leadership Marketing management usually requires leadership of a department or group of professionals engaged in marketing activities. Often, this oversight will extend beyond the companys marketing department itself, requiring the marketing manager to provide cross-functional leadership for various marketing activities. This may require extensive interaction with the human resources department on issues such as recruiting, training, leadership development, performance appraisals, compensation, and other topics. Reporting, Measurement and Control Systems Marketing management employs a variety of metrics to measure progress against objectives. It is the responsibility of marketing managers in the marketing department or elsewhere to ensure that the execution of marketing programs achieves the desired objectives and does so in a cost-efficient manner. Environmental Forces that Affects the Company Ability to Serve its Customers The terrorist attacks of Sept. 11, the corporate scandals and the Iraqi conflict – contributed to changing the traditional marketing environment. There has been some change, particularly in the U.S., in the nature of marketing messages. Ads have, at various turns, become more patriotic, more conservative, less humor-oriented and more focused on companies trustworthiness and reliability. But lets not overstate the change. Sure, if you do a survey asking consumers whether they are more fearful than a year ago, you probably will end up with a result that could be spun to portray a new culture of fear. How Change in the Demographic and Economic Environments Affect Marketing Decisions Demographically, it also is worth considering the dramatic shift that has occurred in the last three years – particularly in the last year, since the results of the 2000 census were made public – toward separate marketing to ethnic minorities. The increasing size of and disposable income of the Hispanic and black populations are driving change as marketers slowly wake up to the need to target these groups through individually tailored mediums and messages. Cultural sensitivity in marketing to diverse groups – as well as to local populations outside of the U.S. – has become an obsession of progressive marketers, and with good reason. A campaign devised to please white America might displease other demographics and can do untold damage to a brand. 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