Post on 14-Apr-2018
transcript
7/30/2019 1. Marketing Audit
1/31
UUNNDDEERRSSTTAANNDDIINNGG&&AAPPPPLLIICCAATTIIOONN OOFF
MMAARRKKEETTIINNGGAAUUDDITIT
Thhe RReporrtt PrPr
eeppaarreeddbbyy,,
CMM /
220005//18833
LL..HH..S.S. RRaannaatthuhunnggaa
SSuubbjjeecctt:: SSttrraatteeggiicc MMaarrkkeettiinngg MMaannaaggeemmeenntt ((BBMMKKTT
3320520544)) Leecttuurr err:: MMrr . Ajjitth P.P. Meddiss
SSeemmeesstteerr::33rd
YYeaearr22nndd
SSeemmeesstteerr,,22000099
DDepaparrtmenent oofMMarrkeketingg MMaanageagemenentt
UUnniiveverrssiittyy ooffKKeellaanniiyyaa
7/30/2019 1. Marketing Audit
2/31
AACCKKNNOOWWLLEEDDGGEEMMEENNTT
This assignment was prepared for the purpose of getting the understanding about marketing audit
and its important part is concerned. Im really grateful to our Strategic Marketing Management
Lecture Mr. Ajith P. Medis for giving advice for this assignment. As well as I thank to all those
who helped in the preparation of this assignment.
Thank you forall.
7/30/2019 1. Marketing Audit
3/31
P a g e |
The Marketing
CCOONNTTEENN
TT
Acknowledgment
Introduction 02
Introduction to Marketing Audit 03
Components of Marketing Audit 06
Marketing Environmental Audit 06
Marketing Strategy Audit 07
Marketing Organization Audit 08
Marketing System Audit 08
Marketing Productivity Audit 09
Marketing Functions Audit 09
Tools and Techniques of Marketing Audit 10
SWOT Analyses 10
PEST Analyses 14
Five Forces Analyses 17
The Marketing Audit Process 20
Where to focus Company Marketing Efforts 21
References 23
7/30/2019 1. Marketing Audit
4/31
The Marketing
P a g e |
IINNTTRROODDUUCCTTIIOO
NN
This assignment is focused on to understand the meaning of marketing audit and some
relating parts. In this assignment has been included components of marketing audit, tools and
techniques that used by marketing audit, marketing audit process and the part that focus on
marketing effort forwhere.
The first part is introduction to marketing audit, here discuss about the marketing audit and
its characteristics and benefits and advantages that can be obtained by performing a
marketing audit.
The next part is components of marketing audit, there are six components under marketing
audit such as marketing environmental audit, marketing system audit, marketing strategy
audit, marketing organization audit, marketing productivity audit and marketing function
audit, and all the components are discussed in thispart.
The third part is tools and techniques that can be used by marketing auditor to evaluate the
marketing performance of an organization. Mainly there are three tools such as SWOT
analysis, PEST analysis and five forces analysis. These three tools are explained briefly
under thatpart.
The next part is the marketing audit process. It consists of main two parts and it describe very
briefly in thispart.
The final part in this report is where to focus company marketing efforts. By doing a
marketing audit, company can easily identify for what area or areas the company should
focus on.
7/30/2019 1. Marketing Audit
5/31
The Marketing
P a g e |
IINNTTRROODDUUCCTTIIOONNTTOO MMAARRKKEETTIINNGG AAUUDDITIT
The marketing audit is a fundamental part of the marketing planning process. It is conducted
not only at the beginning of the process, but also at a series of points during the
implementation of the plan. The marketing audit considers both internal and external
influences on marketing planning, as well as a review of the plan itself. Here the marketing
audit is used some tools to evaluate marketing performance of an organization, for example
SWOT analysis for the internal environment, as well as the external environment. Other
examples include PEST and Five Forces Analyses, which focus only on the external
environment.
The marketing audit can be viewed as an umbrella that covers efforts to assess customer
needs and wants and to understand community patterns. The external environment is
examined on both micro and macro levels, including scanning for developing trends. In
addition to this analysis of the external environment, the marketing audit also analyzes theinternal environment.
The marketing audit has been defined by Phillip Kotler as a comprehensive, systematic,
independent and periodic examination activities and resources in order to determine problem
areas and opportunities and to recommend a plan of action. According to definition of Phillip
Kotler, can be identified some characteristics of marketing audit.
7/30/2019 1. Marketing Audit
6/31
The Marketing
P a g e |
CC hh aa rr aa cc tt ee rr ii ss tt iicc ss oo ffMMaarrkk ee tt iinnggAAuu dd ii tt
CCoommpprreehheennssiivvee. The marketing audit covers all the major marketing issues facing an
organization, and not only one or a few marketing trouble spots. The latter would be called a
functional audit if it covered onl y the sales force, or pricing, or some other marketing
activity.
SSyyssttemaatiicc. The marketing audit involves an orderly sequence of diagnostic steps
covering the organization's marketing environment, internal marketing system, and specific
marketing activities. The diagnosis is followed by a corrective action plan involving both
short-run and long-run proposals to improve the markets.
IInndeepenndeentt. The marketing audit is normally conducted by an inside or outside party who
has sufficient independence from the marketing department to attain top management's
confidence and the needed objectivity.
PPeerriiooddiicc. The marketing audit should normally be carried out periodically instead of
only when there is a crisis. It promises benefits for the organization that is seemingly
successful, as well as the one that is in deep trouble.
OOtthheerrcchhaarracactteerriissttiiccss
EEnvnviirroonnmmeenntt the circumstances or conditions surrounding the agency, both
within and without
OObbjjeeccttiivveess worked toward or striven for , and measurable
SSttraatteegiieess plans ofaction
AAccttiiviitiiess specified and supervised fields ofaction
RReessoouurrcceess an available supply that can be drawn on when needed
PPrroobblleemm aarreeaass situations that present uncertainty , perplexity ordifficulty
PPllaann ooffacacttiioonn process of doing orperforming
From this overall definition and sum of its parts, it can be seen that the marketing audit
provides a very complete assessment the environment. In that situation most ofthe
organization has chosen to operate abusiness.
7/30/2019 1. Marketing Audit
7/31
The Marketing
P a g e |
AA dd vv aa nnttaa gg ee ss ooff MM aa rrkk ee tt iinn gg AAuuddiitt
A marketing audit can be defined as a systematic, periodic and a comprehensive procedure of
checking out the marketing activities of a concern. Some of the other benefits and advantages
of marketing audit are as follows.
The audit provides the marketers with an in depth view of the marketing activities
that are going around in the concern. It brings out a complete picture of the entire
operations of the concern. While revealing the various drawbacks the audit process
also leads to efficiency. This process can also be used to lay down an improved
marketingplan.
A marketing audit can help a company refine its business practices and improve its
productivity andprofitability.
Marketing audit helps to marketing executives, top management and investors to
ensure that they are doing the right things to help drive growth for theirorganizations.
A marketing audit is a careful examination and evaluation of marketing practices and
results. It offers a baseline for performance measurements and a framework for
effective business planning to maximize positive external perception and demand
generation.
An audit helps the company determine the value of a sale and a sales lead.
There are no permanent "right" answers in marketing. Customers' needs and wants
are moving targets, and marketing programs require testing and retesting to find the
most profitable formula. A marketing audit is the way to achieve success by
providing an interim report card to help the company and their staffs tap into inherent
resource.
Marketing audits often lead to strategic marketing change. Careful assessment of the
changing environment, customers, channels, and competitors may lead to a
reassessment of firm direction,
7/30/2019 1. Marketing Audit
8/31
The Marketing
P a g e |
CCOMOMPPOONNEENNTT OOFFTTHHEE MMAARRKKEETTIINNGG AAUU
DDITIT
Marketing audit should start with the market place at beginning and should explore the
changes that are happening in the marketplace. Then the marketing audit will move to
examine the companys marketing objectives and strategies, organization and systems. The
marketing auditor may move to examine one or two key functions in more detail that areimportant to the marketing performance of the company. The marketing audit follows the
following areas as components of marketing audit:
Environmental Audit
Macro Environmental Audit
Task Environmental Audit
Marketing Strategy Audit
Marketing Organization Audit
Marketing System Audit
Marketing Productivity Audit
Marketing Functions Audit
MM aa rr kk eettii nn gg EE nn vv iirr oonn mmee nn tt AAuudd ii tt
The auditor is firstly started their audit by looking at the factors that affect all companies
operating in marketplace, and also looking at their customers and their profits. Under
marketing environment audit, following two environments are concerned, because these are
very important under the marketing audit.
The macro-environment
The taskenvironment
7/30/2019 1. Marketing Audit
9/31
The Marketing
P a g e |
MMaa ccrroo--EE nnvviirroonnmmeenntt aallAAuuddiitt
The Macro-environmental component examines six main areas, the detail depending on the
involvement of the business and involvement required by the industry. Under marketing
audit, the macro environment covers some environmental factors, like, Demographics - major
demographic developments and trends pose opportunities, Economical factors -
developments in income, prices, savings and credit will affect the company under that,
Environmental factors, Technological factors - changes occurring in product and process
technology and company's position in these technologies, Political factors - changes in laws
and regulations might affect marketing strategy and tactics and the changes in the areas of
pollution control, equal employment opportunity, product safety, ad vertising, price
control, that affects the marketing strategy of company, Cultural - public's attitude towards
business and toward the company's products and changes in customer lifestyles and
values might affect the company,
TTaskk-EEnnvvirroonnmmenttAAuuddiitt
How competitive is the marketplace? What are competitors doing, and are they doing it well?
What might they be preparing to do? These are all vital to understand in preparing yourselves
for the battle. The task environment audit is evaluated under Markets - mar ket size,
growth, geographical distribution and profits and major market segments, under
customers - customers' needs and buying processes and also product quality, service,
sales force and price, Competitors, Distribution & dealers, Suppliers, Facilitators &
marketing firms and Publics.
MM aa rr kk eettii nn gg SS tt rr aatt eeggyy AA uu dd ii tt
The marketing strategy audit is vital for company, and the marketing audit is make sure that
the companys marketing strategy is fit with companys marketing goals and objectives as
well as corporate goals and objectives. Under the marketing strategy audit, the auditor
evaluate marketing performance by evaluating marketing goals and objectives, company
mission the move to the strategy of organization. Under strategy evaluation, the auditor may
7/30/2019 1. Marketing Audit
10/31
The Marketing
P a g e |concern following type ofquestions:
7/30/2019 1. Marketing Audit
11/31
The Marketing
P a g e |
Has the management articulated a clear marketing strategy for achieving its
marketing objectives?
Is the strategy convincing?
Is the company using the best basis for market segmentation?
Does the company have clear criteria for rating the segments?
Has the company developed an effective positioning and marketing mix for each
target segment?
MM aa rr kk e t ii nn gg OO rr g aa nn ii zz aa tt ii oo n A
u d i tt
The marketing organization audit is mainly considered effectiveness of the organization
activities as well as efficiency of operation of company. Here all the activities and main
management functions are considered such as manufacturing, purchasing, financing as well
as research and development. Here the marketing auditor must make sure that the company is
actually achieved the effectiveness within the organization and also within the marketplace.
And also following types of questions are considered by marketing auditors:
Are there good communications and working relations between marketing and sales?
Is the product-management system working effectively?
Are product managers able to plan profits or only sales volumes?
MM aa rr kk e t ii nn gg SS yy s tee m ss AA uu dd ii tt
Here the marketing auditor is considered whether the company is using appropriatemarketing systems to collect the information, plan the activities, control the operations and to
maintain smoothly their day to day activities and whether these systems are properly worded
within the company or not. Those are the main things, the marketing auditor must consider
under marketing systems audit. Most of the organizations are today having different type of
marketing systems to collect the information and control the operation. Such as marketing
information systems, marketing planning systems, marketing control systems and new
product development systems. These systems have its own functions. Here the marketing
7/30/2019 1. Marketing Audit
12/31
The Marketing
P a g e |auditor task is to make sure whether the systems are properly worked ornot.
7/30/2019 1. Marketing Audit
13/31
The Marketing
P a g e |
MM aa rr kk eettii nn gg PP rroodd uu cc tt ii vv ii tt yyAA uu dd iitt
Most of the companies are operating to earn so much of profits. The marketing productivity
audit is focused on evaluate the company profits and revenue. So the marketing productivity
audit is very important to evaluate the marketing performance. The marketing auditor is used
profitability analysis and cost effectiveness analysis for their evaluation process. Under the
marketing productivity audit, following type question asked by marketing auditor:
What is the profitability of the company's different products, markets, territories and
channels ofdistribution?
Should the company enter, expand, contract or withdraw from any business
segments?
Do any marketing activities seem to have excessive costs?
Can cost-reducing steps be taken?
MM aa rr kk eettii nn gg FF uu nn cctt ii oo nn AAuuddii tt
Under the marketing function audit, the auditor is using marketing mix elements to analyze
company functions such as product, price, place and promotion. Here marketing auditor
evaluates marketing performance by asking questions under product, price, place and
promotion such as
What are the company's product-line objectives?
Which products should be phased out?
Which products should be added to?
What are the company's pricing objectives, policies, strategies and procedures?
To what extent are the prices set on cost, demand and competitive criteria?
Do the customers see the company's prices as being in line with the value of its offer?
What are the organizationss advertising objectives?
Is there adequate market coverage and service?
Should the company consider changing its distribution channels?
7/30/2019 1. Marketing Audit
14/31
The Marketing
P a g e | Is the right amount being spent on advertising?
What do customers and the public think about the advertising?
7/30/2019 1. Marketing Audit
15/31
P a g e |
The Marketing
MMAARRKKEETTIINNGG AAUUDDITITTTOOOOLLSS AANNDD
TTEECCHHNNIIQQUUEESS
Marketing audit is very important and crucial part in the marketing planning process. It is not
only carried out at the beginning of the marketing planning process but also it can be
implemented during the marketing planning process. The marketing audit can be influenced
on marketing planning process through various external and internal factors. Here there arenumber of marketing audit tools and techniques that are used during the marketing planning
process to evaluate the marketing performance of an organization. The following analysis
tools are utilized during a marketing audit:
SS WW OOTT AA nn aa ll yyss ii ss
The one of the most importance tools in the marketing audit is SWOT analysis or can be
express as Strength, Weaknesses, Opportunities and Treats analysis. This tool is very much
important to marketers and is used at the beginning of the marketing audit process. The
SWOT has lot of advantage as well as it has some disadvantages. Some of disadvantage of
SWOT analysis are that it is very subjective and cannot be relied on too much. However,
most of the companies are used this SWOT analysis as tools to evaluate the marketing
performance of an organization. SWOT stands for strengths, weaknesses, opportunities, and
threats. Strengths and weaknesses are internal factors. Opportunities and threats are external
factors. The SWOT analysis can be express asbelow:
Strengths and weaknesses are internal factors that create value or destroy value. They can
include assets, skills, or resources that a company has at its disposal, compared to its
competitors. They can be measured using internal assessments or externalbenchmarking.
7/30/2019 1. Marketing Audit
16/31
The Marketing
P a g e |
Intern
al
Strengths Weaknesses
SWOT
Opportunity
Extern
al
Threats
SSoomee sstrr enngtthhs off ann orrgganniizzattioon aare ass ff olllooww s::
Your specialist marketing expertise
A new, innovative product orservice
Location of yourbusiness
Quality processes andprocedures
Any other aspect of your business that adds value to your product orservice
SSoommee wweeaakknneesssseess ooffaannoorrggaanniizazattiioonnaarree aass ffoolllloowwss:
Lack of marketing expertise
Undifferentiated products or services (i.e. in relation to competitors)
Location of yourbusiness
Poor quality goods orservices
Damaged reputation
7/30/2019 1. Marketing Audit
17/31
The Marketing
P a g e |Opportunities and threats are external factors that create value or destroy value. A company
cannot control them. But they emerge from either the competitive dynamics of the
7/30/2019 1. Marketing Audit
18/31
industry/market or from demographic, economic, political, technical, social, legal orcultural
factors (PEST).
SSoomee oopppoorr tuunnittiees ooff ann orrggannizzattioon aaree ass folllooww s::
A developing market such as the Internet
Mergers, joint ventures or strategic alliances
Moving into new market segments that offer improvedprofits
A new international market
A market vacated by an ineffective competitor
SSoommee tthhrreeaattss ooffaannoorrggaanniizzaattiioonnaarree aassffoolllloowwss::
A new competitor in your home market.
Price wars with competitors.
A competitor has a new, innovative product orservice.
Competitors have superior access to channels ofdistribution.
Taxation is introduced on your product orservice.
TT WW O S MM a tt rr ii xx
The auditor can use this TWOS analysis to analyze external environment (threats and
opportunities), and internal environment (weaknesses and strengths). The auditor can use this
technique to think about the strategy of whole organization, a department or a team. Auditor
can also use them to think about a process, a marketing campaign, or even company own
skills and experience.
TOWS Matrix, helps the auditor to think about the options that company could pursue. To do
this auditor match external opportunities and threats with company internal strengths and
weaknesses, as illustrated in the matrix follows:
7/30/2019 1. Marketing Audit
19/31
TTOOWS Stt rateeggicc AAlttee rnnaatt ives MMatrrixx
ExternalOpportunities
(O)
1.2.
3.4.
External Threats(T)
1.
2.3.
4.
Internal Strengths
(S)
1.2.
3.4.
SO
"Maxi-Maxi"Strategy
Strategies that use
strengths to maximizeopportunities.
ST
"Maxi-Mini"Strategy
Strategies that use
strengths tominimize threats.
Internal
Weaknesses (W)
1.
2.3.4.
WO
"Mini-Maxi"Strategy
Strategies that
minimize weaknesses
by taking advantage
ofopportunities.
WT
"Mini-Mini"Strategy
Strategies thatminimize weaknesses
and avoid threats.
This helps the auditor to identify strategic alternatives that address the following additional
questions:
Strengths and Opportunities (SO) - How can company use their strengths to take
advantage of the opportunities?
Strengths and Threats (ST) - How can the company take advantage of their strengths
to avoid real and potential threats?
Weaknesses and Opportunities (WO) - How can company use their opportunities to
overcome the weaknesses company is experiencing?
Weaknesses and Threats (WT) - How can company minimize their weaknesses and
avoid threats?
7/30/2019 1. Marketing Audit
20/31
PP EE SSTT AA nnaallyy ssiiss
Here a marketing analysis should be taken into consideration all the environmental factors
and will give it a careful analysis. These environmental factors may be internal or external.
The internal factors consist of the staff and queries related to them. The external would be the
external customer and the various distributors and the political and economic factors are also
taken into consideration.
This PEST analysis has various factors that have an effect on the marketing planning process.
The PEST analysis tool is a valuable framework for identifying opportunities and threats in
the macro (external) environment. It works through the various components of the macro
environment and prompts the company to look at the specific areas in depth. This analysis
tool is extremely important to any marketing audit, simple or complex; as it drives the
company to investigate what factors may help or impede them to carry out business and
marketing activities. The PEST analysis can be express as follows.
P
Political
PESTAnalysis
E Environment
S Social
T Technological
PPooll iittiiccaallFFaaccttoorrss
Political factors can have a direct impact on the way business operates. Decisions made by
government affect the operations of units within the company to a varying degree. Political
refers to the big and small p political forces and influences that may affect the performance
7/30/2019 1. Marketing Audit
21/31
of, or the options open to the unit concerned. The political factors have a huge influence upon
the regulation of public and private sector businesses, and the spending power of consumers
7/30/2019 1. Marketing Audit
22/31
and other businesses. Political factors include government regulations and legal issues and
define both formal and informal rules.
EEccoonnoomimicc FFaaccttoorrss
All businesses are affected by economical factors nationally and globally. Whether an economy
is in a boom, recession or recovery will also affect consumer confidence and behavior. This will
impact upon the nature of the competition faced by the company and particular units within the
company, upon service provision, and upon the financial resources. Economic factors affect the
purchasing power of potential customers, and the state of the internal/external economy in the
short and long-term. The unit may need to consider: economic growth, interest rates, inflation
rate and inflation rate.
SSoocciaall//CCuullturraallFFaacctoorrss
Social factors will include the demographic changes, trends in the way people live, work and
think and cultural aspects of the macro environment. These factors affect customer needs and
the size of potential markets such as population growth rate, age distribution, careerattitudes,
internal/external emphasis on safety and internal/external attitudes to change.
TTechhnnoollogiccal FFaccttors
New approaches to doing new and old things and tackling new and old problems do not
necessarily involve technical factors, however, technological factors are vital for competitive
advantage, and are a major driver of change and efficiency. Technological; factors can for
example lower barriers to entry, reduce minimum efficient production levels, and influence
outsourcing decisions. New technology is changing the way business operates. The Internet
is having a profound impact on the strategy of organizations. Technological revolution means
a faster exchange of information beneficial for businesses as they can react quickly to
changes within their operating environment. For examples a utomation, t
echnology incentives, rate of technological change , perception of technological change
within the unit and stakeholderexpectation.
7/30/2019 1. Marketing Audit
23/31
P a g e |
FFiivvee FFoorrccee AAnnaallyysseess
This Five Force analysis is very effective analysis that enables the marketer to have a clear
picture of the competition and it can measure the attractiveness of the industry. In this
analysis the marketer basically goes through five basic areas of concern. The areas can be
identified into five areas as threat of substitute products , threat of new entrants , rivalry
among competitors, bargaining power of customers and bargaining power of suppliers. There
are some advantages in this analysis; it leads to economics of large scale with the help of
mass purchasing and sales. This is also very effective analysis to audit the marketing
performance of an organization. So this analysis can be express as follows.
Rivalry
amongcompetitors
TThe thhrreaeatt offssuubbsstiitt utee pprroodducctt s
The existence of close substitute products increases the propensity of customers to switch to
alternatives in response to price increases (high elasticity of demand ).
buyer propensity to substitute
relative price performance of substitutes
7/30/2019 1. Marketing Audit
24/31
P a g e |
TThhrreaeattss ooff nneeww eennttrraannttss
Profitable markets that yield high returns will draw firms. This results in many new entrants,
which will effectively decrease profitability. Unless the entry of new firms can be blocked by
incumbents, the profit rate will fall towards a competitive level (perfect competition).
The existence of barriers to entry (patents, rights, etc.)
Economies of product differences
Brand equity
RRiivv
aallrryyaammoonnggccoommppe
ettiittoorrss
For most industries, this is the major determinant of the competitiveness of the industry.
Sometimes rivals compete aggressively and sometimes rivals compete in non-price
dimensions such as innovation, marketing, etc.
Number ofcompetitors
Rate of industry growth
intermittent industry overcapacity
TThe baa rgaaiininngg ppoowweerr ooffcuusstoomeerrss
The ability of customers to put the firm under pressure and it also affects the customer's
sensitivity to price changes.
Buyer concentration to firm concentration ratio
Degree of dependency upon existing channels ofdistribution
TThe baa rgaaiininngg ppoowweerr ooffsuuppppllieerrss
Suppliers of raw materials, components, labor, and services (such as expertise) to the firm
can be a source of power over the firm. Suppliers may refuse to work with the firm, or e.g.
charge excessively high prices for unique resources.
Supplier switching costs relative to firm switching costs
7/30/2019 1. Marketing Audit
25/31
P a g e | Degree of differentiation ofinputs
Presence of substitute inputs
Supplier concentration to firm concentration ratio
7/30/2019 1. Marketing Audit
26/31
P a g e |
TThhee MMaarrkkeettiinngg AAuuddiitt PPrroocceessss
Auditors must prepare for the marketing audit by holding discussions with the CEO and
executive staff, and briefly reviewing some financial and marketing data. Audits are often in
two parts. The first part begins with a meeting between the auditors and business unit
management, and reviews of the unit's financial statements, product literature, and
organizational plans exhibit as follows. The auditors explain objectives, procedures, time
frame and expected audit output, and required participation from each manager. Participation
usually comprises an initial two-hour interview; then others are designated forpotential
interviews and provision of operating and financial information. The auditors typically tour
manufacturing and other operations areas to better understand product features, quality
levels, and cost differentials that distinguish the business from competition. The auditors also
review customer service, shipping, credit operations, order entry, advertising, research and
development, and manufacturing engineering. The auditors collect memos, reports, and
analyses that help them understand the firm's marketing strategy and businessprocesses.
TThe Marrkkettiing AAuditt PProceesss
PPaarrtI
Review background materials: financial results, organization chart, businessplans.
Interview management and tourfacilities
Ride with salespeople and visit customers
Hold interim meetings to discuss findings and likely alternatives
PPaarrtII
Gather additional information:
Additional management and salesperson interviews
Interview and written surveys with customers and trade
7/30/2019 1. Marketing Audit
27/31
P a g e |
Internal written survey
Outside expert interviews
Competitorinterviews
Product costs and profits, sales results, marketingbudgets
Perform analysis and develop alternatives.
Hold work sessions to develop marketing strategy and next steps for implementation.
Managerial interviews are conducted. Managers discuss their responsibility areas in depth;
many questions are asked of several managers to elicit differentperspectives.
All interview data are confidential. Good auditors project a professionalism in under-
standing the business and maintaining confidences that allows business unit managers to
"open up" on controversial topics. Manager candor is particularly important when two or
more powerful executives hold opposing views. Auditors surface these views by using
unattributed quotes when reporting findings. Competent auditors continually draw upon their
experience to probe the consistency, appropriateness and sufficiency of the firm's marketing
plans and actions.
After initial interviews, auditors usually take two parallel steps. First, they conduct a library
search for independent published material on the firm, competition, and industry. Second,
they become familiar with the sales force and customer buying behavior by making joint
customer calls. Through this process, auditors gather clues in several areas including market
needs, firm competitiveness, sales and purchase processes, and where the organization is
functioning well andpoorly.
Visits with salespeople provide invaluable "soft" data; salespeople are notoriously irreverent
regarding "what's really going on" at headquarters, including manager disagreements,
rivalries, and favoritisms.
Following these steps, the auditors analyze and organize information and report key issues
and observations to the management team in a two- to three-hour working session. Surfaced
7/30/2019 1. Marketing Audit
28/31
P a g e |
issues are discussed and preliminary ideas for eventual audit outcome and alternative action
courses are laid out.
The second part of the audit is typically more time consuming than the first part. It comprises
customer and trade surveys; further secondary data gathering; analysis of competitive
products; evaluation of marketing strengths and weaknesses; interviews with industry
experts; detailed analysis of internal financial, sales, and operating information; and second
managerial interviews. Management is formally surveyed to compare its views on the firm
and competition with customer viewpoints. Finally, all data must be analyzed.
The audit concludes with the presentation of findings and recommendations, first privately tothe CEO and one or two executive staff, and then at a day-long meeting with the entire
management group. The goal is to gain a common understanding of audit findings so a
consensus on future marketing needs, opportunities, and actions is formed.
7/30/2019 1. Marketing Audit
29/31
P a g e |
WWHHEERREETTOO FFOOCCUUSS CCOMOMPPAANNYY MMAARRKKEETTIINNGG
EEFFFFOORRTTSS
After establishing marketing goals, company marketing team should identify target areas for
the marketing efforts. To do this, company should conduct either, or a combination of:
A marketing audit to understand the current internal marketing status oforganization
Market research to find out from company target population what theirperceptions
organization and other organizations are
Performing a marketing audit, a marketing audit assesses the marketing mix, or the
combination of efforts that an organization makes to increase knowledge about and demand
for its target populations. The key elements of the marketing mix that company should assess
are:
PPrroduoducctt - The services or outputs company offers. PPoopupullaa titiononss - The groups with whom company makes exchanges of services
for resources.
PPrii ce - The amount company charges for each service.
PPlaccee - The locations where company product is available and ways in which
company population can access companyproduct.
PPrroduoduccttii oonn company capacity for meeting demand.
PPrroommoottii oonn - The communication techniques and messages company uses to
motivatepeople to respond.
The audit helps company to address their action goals by organizing information to help
company see if the company is providing the right services at the right prices, in easily
accessible ways to the right people, and if the company has the capacity to produce the
quantities of services demanded. To meet company image goals, the audit will help company
to identify the key groups of People Company is reaching and plan company promotional
efforts to reinforce the image that company want.
7/30/2019 1. Marketing Audit
30/31
P a g e |
For the audit, company and their marketing team will look at service records, make
observations in the facility, and collect information from staff, clients, the community, and
others who know companys target populations well. Company can conduct an in-depth audit
where company gather a great deal of information over six months or perform a quicker audit
to identify troublesome areas. If company decides to assess a number of departments,
company will want to perform a separate audit foreach.
As a result of the marketing audit, company should be able to identify where company need
more information, where company needs to make adjustments in the current mix, and what
features and benefits company shouldpromote.
7/30/2019 1. Marketing Audit
31/31
P a g e |
RREEFFEERREENNCCEE
SS
Auditing the Marketing Function: William H. Rodgers, Hamilton Consultants Gerard
A. Osborne, Hamilton Consultants Philip Kotler, Northwestern University
Marketing Plan, how to prepare them, how to use them; 6th
edition,: Malcolm
McDonald
Strategic Marketing Management, Planning, implementation and control; 3rd
edition:
Richard M.S. Wilson, Colin Gilligan (2005)
Auditing Markets, Products, and Marketing Plans; David Parmerlee,
Marketing/planning library and information services; 2nd
edition: Darlene E.
Weingand
The Marketing Audit Comes Of Age: Philip Kotler, William Gregor and William
Rogers