Marketing Management: Brief edition 1. Marketing Marketing Concept 1.1 Definitions of Marketing There are many definitions of marketing. The better definitions are focused upor customer orientation and satisfaction of customer need Kotler: Marke ting is the social process by which individuals and groups obtain what they need and want through creating and exchanging products and value with others The Chartered Institute of Marketing: Marketing is the management process that identifies, anticipates and satisfies customer requirements profitably The CIM definition(in common with Barwell's definition of the marketing concept) looks not only at identify ing customer needs, but also satisfying them(short-term)and anticipating them in the future(long-term retention) Adcock et al: The right product, in the right place, at the right time, at the right price This is a snappy and realistic definition that uses McCarthy's Four Ps Palmer: Marketing is essentially about marshaling the resources of an organication so that they meet the changing needs of the customer on whom the organization depends. This is a more recent and very realistic definition that looks at matching capabilities with needs Bartles: Marketing is the process whereby society, to supply its consumption needs evolves distributive systems composed of participants, who, interacting under constraints-technical (economic) and ethical (social)-create the transactions or flows, which resolve market separations and result in exchange and consumption This definition considers the economic and social aspects of marketing
Marketing Management: Brief edition 1 1. Marketing & Marketing Concept 1.1 Definitions of Marketing There are many definitions of marketing. The better definitions are focused upon customer orientation and satisfaction of customer needs. Kotler: Marketing is the social process by which individuals and groups obtain what they need and want through creating and exchanging products and value with others. The Chartered Institute of Marketing: Marketing is the management process that identifies, anticipates and satisfies customer requirements profitably. The CIM definition (in common with Barwell’s definition of the marketing concept) looks not only at identifying customer needs, but also satisfying them (short-term) and anticipating them in the future (long-term retention). Adcock et al: The right product, in the right place, at the right time, at the right price. This is a snappy and realistic definition that uses McCarthy’s Four Ps. Palmer: Marketing is essentially about marshaling the resources of an organization so that they meet the changing needs of the customer on whom the organization depends. This is a more recent and very realistic definition that looks at matching capabilities with needs. Bartles: Marketing is the process whereby society, to supply its consumption needs, evolves distributive systems composed of participants, who, interacting under constraints – technical (economic) and ethical (social) – create the transactions or flows, which resolve market separations and result in exchange and consumption. This definition considers the economic and social aspects of marketing
Marketing Management: Brief edition 1.2 The Philosophy Marketing and the Marketing Concept The marketing concept is a philosophy. It makes the customer, and the satisfaction of his or her needs, the focal point of all business activities. It is driven by senior managers, passionate about delighting their customers Drucker: Marketing is not only much boader than selling, it is not a specialized activity at all It encompasses the entire business. It is the whole business seen from the point of view of the final result, that is, from the customer 's point of view. Concern and responsibility for marketing must therefore permeate all areas of the enterprise Barwell: This customer-focused philosophy is known as the marke ting concept. The marketing concept is a philosophy, not a system of marke ting or an organizational structure. It is founded on the be lief that profitable sales and satisfactory returns on investment can only be achieved by identifying, anticipating and satisfying customer needs and desires Cohen: The achievement of corporate goals through meeting and exceeding customer needs better than the competition. Jobber: Implementation of the marketing concep Tin the 1990s requires attention to three basic elements of the marke ting concept These are: Customer orientation; an organiation to implement a customer orientation; Long-range customer and societal welfare 2
Marketing Management: Brief edition 2 1.2 The Philosophy Marketing and the Marketing Concept. The marketing concept is a philosophy. It makes the customer, and the satisfaction of his or her needs, the focal point of all business activities. It is driven by senior managers, passionate about delighting their customers. Drucker: Marketing is not only much broader than selling, it is not a specialized activity at all It encompasses the entire business. It is the whole business seen from the point of view of the final result, that is, from the customer’s point of view. Concern and responsibility for marketing must therefore permeate all areas of the enterprise. Barwell: This customer-focused philosophy is known as the ‘marketing concept’. The marketing concept is a philosophy, not a system of marketing or an organizational structure. It is founded on the belief that profitable sales and satisfactory returns on investment can only be achieved by identifying, anticipating and satisfying customer needs and desires. Cohen: The achievement of corporate goals through meeting and exceeding customer needs better than the competition. Jobber. Implementation of the marketing concept [in the 1990’s] requires attention to three basic elements of the marketing concept. These are: Customer orientation; an organization to implement a customer orientation; Long-range customer and societal welfare
Marketing Management: Brief edition 2 Environment 2.1 The Marketing environment The macro-environment The micro-environment Politcal Factors nment Men Stakeholders Technological Socio-cultural The Marketing Environment The marketing environment surrounds and impacts upon the organization. There are on the marketing environment, namely the macro-environment the 'micro-environment and the 'internal environment 2.1.1 the macro-environment This includes all factors that can influence an organization, but that are out of their direct control. A company does not generally influence any laws(although it is accepted that they could lobby or be part of a trade organization). It is continuousl hanging, and the company needs to be flexible to adapt. There may be aggressive competition and rivalry in a market. global ization means that there is always the threat of substitute products and new entrants. The wider environment is also ever hanging, and the marketer needs to compensate for changes in culture, politics, economics and technology
Marketing Management: Brief edition 3 2. Environment 2.1 The Marketing Environment The marketing environment surrounds and impacts upon the organization. There are three key perspectives on the marketing environment, namely the 'macro-environment,' the 'micro-environment' and the 'internal environment'. 2.1.1 the macro-environment This includes all factors that can influence an organization, but that are out of their direct control. A company does not generally influence any laws (although it is accepted that they could lobby or be part of a trade organization). It is continuously changing, and the company needs to be flexible to adapt. There may be aggressive competition and rivalry in a market. Globalization means that there is always the threat of substitute products and new entrants. The wider environment is also ever changing, and the marketer needs to compensate for changes in culture, politics, economics and technology
Marketing Management: Brief edition 2.1.2 the micro-environment This env ironment influences the organization directly. It includes suppliers that deal directly or indirectly, consumers and customers, and other local stakeholders. Micro tends to suggest small, but this can be mislead ing. In this context, micro describes the and the driving forces that control this relationship. It is a more local relationship, and the firm may exercise a degree of influence P olitical Factors E 磁→← ociocultural Factors T 2.1.3 the internal environment All factors that are internal to the organization are known as the 'internal env ironment They are generally aud ited by applying the ' Five Ms,, which are Men, Money, Machinery, Materials and Markets. The internal environment the external. as marketers internal change internal marketing. Essentially we use marketing approaches to aid communication and change management The external environment can be aud ited in more detail using other approaches such as SWOT Analysis, Michael Porters Five Forces Analysis or PEST Analysis 2.2 SWOT Analysis SWOT analysis is a tool for auditing an organization and its environment. It is the first stage of planning and helps marketers to focus on key issues Once key issues have been identified they feed into marketing objectives. It can be used in conjunction with other tools for aud it and analysis, such as PESt analysis and Porters Five-Forces analysis. It is a very popular tool with marketing students because it is quick and easy to learn
Marketing Management: Brief edition 4 2.1.2 the micro-environment This environment influences the organization directly. It includes suppliers that deal directly or indirectly, consumers and customers, and other local stakeholders. Micro tends to suggest small, but this can be misleading. In this context, micro describes the relationship between firms and the driving forces that control this relationship. It is a more local relationship, and the firm may exercise a degree of influence. 2.1.3 the internal environment All factors that are internal to the organization are known as the 'internal environment'. They are generally audited by applying the 'Five Ms’, which are Men, Money, Machinery, Materials and Markets. The internal environment is as important for managing change as the external. As marketers we call the process of managing internal change 'internal marketing.' Essentially we use marketing approaches to aid communication and change management. The external environment can be audited in more detail using other approaches such as SWOT Analysis, Michael Porter's Five Forces Analysis or PEST Analysis. 2.2 SWOT Analysis SWOT analysis is a tool for auditing an organization and its environment. It is the first stage of planning and helps marketers to focus on key issues. Once key issues have been identified, they feed into marketing objectives. It can be used in conjunction with other tools for audit and analysis, such as PEST analysis and Porter's Five-Forces analysis. It is a very popular tool with marketing students because it is quick and easy to learn
Marketing Management: Brief edition Strengths Weaknesses pportunities Threats SWOT Analysis SWOT stands for strengths, weaknesses, opportunities, and threats. Strengths and weaknesses are internal factors. For example, strength could be your specialist marketing expertise. A weakness could be the lack of a new product. Opportunities and threats are external factors. For example, an opportunity could be a developing market such as the Internet. a threat could be a new competitor in your home market During the SwoT exercise, list factors in the relevant boxes. It's that simple A word of caution, SWOT analysis can be very sub jective. Do not rely on it too much Two people rarely come-up with the same final version of SWoT. tOws analysis is extremely similar. It simply looks at the negative factors first in order to turn them into positive factors. So use it as guide and not a prescription. Adding and weighting criteria to each factor increase valid ity, but that 's another lesson SWOT Analysis - Exercise: Highly Brill Leisure Center Perform SWOT analysis based upon the following points 1. The Center is located within a two-minute walk of the main bus station and is a fifteen-minute ride away from the local railway station 2. There is a competition standard swimming pool; although it has no wave machines or whirlpool equipment as do competing local facilities 3. It is located next to one of the largest shopping centers in Britain 4. It is one of the oldest centers in the area and needs some cosmetic attention 5. Due to an increase in disposable income over the last six years, local residents
Marketing Management: Brief edition 5 SWOT stands for strengths, weaknesses, opportunities, and threats. Strengths and weaknesses are internal factors. For example, strength could be your specialist marketing expertise. A weakness could be the lack of a new product. Opportunities and threats are external factors. For example, an opportunity could be a developing market such as the Internet. A threat could be a new competitor in your home market. During the SWOT exercise, list factors in the relevant boxes. It's that simple. A word of caution, SWOT analysis can be very subjective. Do not rely on it too much. Two people rarely come-up with the same final version of SWOT. TOWS analysis is extremely similar. It simply looks at the negative factors first in order to turn them into positive factors. So use it as guide and not a prescription. Adding and weighting criteria to each factor increase validity, but that's another lesson! SWOT Analysis - Exercise: Highly Brill Leisure Center. Perform SWOT analysis based upon the following points: 1. The Center is located within a two-minute walk of the main bus station, and is a fifteen-minute ride away from the local railway station. 2. There is a competition standard swimming pool; although it has no wave machines or whirlpool equipment as do competing local facilities. 3. It is located next to one of the largest shopping centers in Britain. 4. It is one of the oldest centers in the area and needs some cosmetic attention. 5. Due to an increase in disposable income over the last six years, local residents