Date post: | 09-Apr-2018 |
Category: |
Documents |
Upload: | lam-sameer |
View: | 214 times |
Download: | 0 times |
of 30
8/8/2019 L1 the Nature of Marketing
1/30
The Nature of Marketing
Relevant Reading
Chapter 1 of Jobber & Fahy
8/8/2019 L1 the Nature of Marketing
2/30
Learning Objectives
To introduce and outline the marketing concept
To introduce the concepts of customer satisfaction andvalue
To identify the relationship between the marketingconcept and business performance
To introduce the role and importance of marketingplanning
To demonstrate that marketing has a role to play in not-for-profit as well as profit making organisations
8/8/2019 L1 the Nature of Marketing
3/30
Marketing influences all of us
University of Greenwich Study
Only 8% of respondents could differentiate between tap and
bottled water.
University of Plymouth Study Asked respondents to assess various waters based on
perceived purity, taste, price and packaging
Tap water was substituted for mineral water contents
Respondents perceived differences that did not exist, andindicated that the brands with the best packaging were thepurest, tastiest and most expensive
8/8/2019 L1 the Nature of Marketing
4/30
Price, Packaging & Perception
At the time of the study Sainsburys own brand water cost19p per litre, whilst Ty Nant cost 1.70 per litre
Conclusion if marketing affects us in such artificial
circumstances, can you be sure that your choice of coffee is
made on taste grounds, or your jeans on the basis of quality?
8/8/2019 L1 the Nature of Marketing
5/30
Good Marketing is
not just advertising
not about persuading people to buy products or
services that they do not want or need
is concerned with identifying and satisfying
customers needs and wants marketing research is
therefore vital!
8/8/2019 L1 the Nature of Marketing
6/30
Marketing Definition
The Chartered Institute of Marketing define marketing asThe management process which identifies, anticipates andsupplies customer requirements efficiently and profitably
Emphasis is therefore on customers a market orcustomer orientation
Flaws of this definition: assumes profitability only objective;organisations must always make a profit strategicallythere may be reasons for not doing so in the short term
8/8/2019 L1 the Nature of Marketing
7/30
The Marketing Concept
The achievement of corporate goals through meeting andexceeding customer needs better than thecompetition. (Jobber & Fahy, 2009: 3)
Procter & Gamble must win at the first and second
moments of truth that is, in the shop where the customerdecides which brand to select and in the home when he /she uses it. (Jobber & Fahy, 2009: 3)
Customer satisfaction should be the driving force within theorganisation
Customer satisfaction / marketing concept are not the soleresponsibility of the marketing department
8/8/2019 L1 the Nature of Marketing
8/30
Marketing Concept / Orientation
8
Marketing Concept
Customer Orientation Integrated Effort Goal Achievement
T h e a c h i e v e m e n t o f corporate goals throughmeeting and exceedingcustomer needs better than
the competition
Corporate activitiesare focused uponproviding customersatisfaction
All staff accept ther espons i b i l i t y f o r creat ing customersatisfaction
T h e b e l i e f t h a tcorporate goals canbe achieved throughcustomer satisfaction
Source: Jobber & Fahy (2009: 4)
8/8/2019 L1 the Nature of Marketing
9/30
Traditional Alternative BusinessOrientations
Sales orientation - aggressive hard selling will sell
any product
Product orientation - a good product will sell itself /
excessive focus upon product features (at expense
of customer needs)
Production orientation - almost exclusive focus upon
production efficiency and effectiveness
8/8/2019 L1 the Nature of Marketing
10/30
Traditional Business Orientation -Examples
Statement 1 - We believe that our products are the most
innovative on the market. Our quality is second to none and
weve gone all out to develop the best design team in thebusiness
Statement 2 -Our salespeople understand how to get the
customer to sign on the dotted line. Most customers really
want to purchase our product when they see it: they just needa little push to make up their minds.
8/8/2019 L1 the Nature of Marketing
11/30
Traditional Business Orientation -Examples
Statement 3 -Customers can be fickle sometimes. Weve just
had to change a specification because the customer wanted
something else at the last minute. This also affected ourproduction and delivery department, and everything had to berecosted. Still at least everyone pulled together on this one.
Statement 4 - The customer can have any colour so long as it
is black
8/8/2019 L1 the Nature of Marketing
12/30
Marketing and the rest of theorganisation
Viewed as a philosophy, everybody in an organisationshould be a part-time marketer
Marketing is so basic that it cannot be considered to bea separate function. It is the whole business seen fromthe point of view of its final result, that is, from thecustomer's point of view". (Drucker, 1973: 24)
8/8/2019 L1 the Nature of Marketing
13/30
Jobber & Fahy BusinessOrientations
Jobber & Fahy (J & F) reduce the traditional orientations tojust two alternatives marketing orientation and productionorientation
When J & F refer to production orientation they areeffectively combining all of the non-marketing orientations
J & F are therefore using production orientation in a muchbroader manner than that described under the traditionalbusiness orientations perspective
J & F also refer to production o. as internally driven
8/8/2019 L1 the Nature of Marketing
14/30
Production Orientation
ProductionCapability
ManufactuerProduct
AggressiveSales Effort
Customers
Source: Jobber & Fahy (2009: 5)
8/8/2019 L1 the Nature of Marketing
15/30
Marketing Orientation
CustomerNeeds
PotentialMarket Opport.
MarketingProdts & Serv.
Customers
Source: Jobber & Fahy (2009: 5)
8/8/2019 L1 the Nature of Marketing
16/30
Market versus Internally Driven Businesses
Market driven businesses
Customer concern throughoutbusiness
Know customer choice criteria andmatch with marketing mix
Segment by customer differences
Invest in market research and track
market changes
Welcome change
Internally orientatedbusinesses
Convenience comes first
Assume price and productperformance are the key to mostsales
Segment by product
Rely on anecdotes and
received wisdom
8/8/2019 L1 the Nature of Marketing
17/30
Market versus Internally Driven Businesses
Market driven businesses
Try to understand competition
Market spend regarded as aninvestment
Reward innovation
Search for latent market
Being fast
Strive for competitive advantage
Internally orientatedbusinesses
Cherish the status quo
Ignore competition
Marketing spend regarded
as luxury
Innovation punished
Stick with the same
Why rush?
Happy to be me-too
8/8/2019 L1 the Nature of Marketing
18/30
Creating Customer Value
Product benefits
Service benefits
Relational benefits
Image benefits
Monetary costs
Time costs
Energy costs
Psychological costs
CustomerValue
Perceived
Benefits
Perceived
Sacrifices
Source: Jobber & Fahy (2009: 4)
8/8/2019 L1 the Nature of Marketing
19/30
Creating Customer SatisfactionDelight
Neutral
DissatisfactionAbsent Fulfilled
Presence of the characteristic
Customers
atisfaction
Delighters
More is better
Must be
Source: Jobber & Fahy (2009: 7)
8/8/2019 L1 the Nature of Marketing
20/30
The Marketing Mix (i)
Product
Price
Place Promotion
People
Processes
Physical evidence
4 Ps
7 Ps - ServiceExtended
Marketing Mix
8/8/2019 L1 the Nature of Marketing
21/30
The Marketing Mix (ii)
8/8/2019 L1 the Nature of Marketing
22/30
An Effective Marketing Mix
Effectivemarketing
mix
Matchescustomer needs
Creates acompetitiveadvantage
Wellbalanced
Matches corporateresources
Source: Jobber & Fahy (2009: 10)
8/8/2019 L1 the Nature of Marketing
23/30
Market Driven Management
Sharedvalues and
beliefs
Customerfocus
Market-ledstrategy
Structureand
systems
Implementation
Marketintelligence
Shared valuesand beliefs
customer first
Marketintelligence
Skills in understandingand responding to
customers
Structure andsystems
structure based onstrategy
team work
Market-ledstrategy
Linking distinctivecompetencies tomarket opportunities
Competitive advantagethe driving force
Implementation
people
incentives
communications
persuasion
8/8/2019 L1 the Nature of Marketing
24/30
Efficiency & Effectiveness (i)
Marketers should ensure that their organisations marketingis both efficient and effective
Efficiency is concerned with inputs and outputs. Anefficient firm produces goods economically it does thingsright. The benefit is that cost per unit of output is low (Jobber & Fahy, 2009: 12)
Effectiveness means doing the right things. This impliesoperating in attractive markets and making products thatconsumers want to buy. (Jobber & Fahy, 2006: 12)
8/8/2019 L1 the Nature of Marketing
25/30
Efficiency & Effectiveness (ii)
Ineffective
Goes out ofbusiness quickly
Dies Slowly
Survives
Does wellThrives
Effective
Efficient
Inefficient
Source: Jobber & Fahy (2009: 12)
8/8/2019 L1 the Nature of Marketing
26/30
Marketing and BusinessPerformance
Market OrientationImprovedbusiness
performance
8/8/2019 L1 the Nature of Marketing
27/30
Not for Profit and Small BusinessMarketing
Marketing principals increasingly being used by not-
for-profit organisations, e.g. charities, government
agencies Rising expectations of users of these organisations
Often, their environment is becoming more competitive
Objectives - performance instead of profit
Small Businesses Necessity not a luxury
8/8/2019 L1 the Nature of Marketing
28/30
Marketing Planning Process & relevantchapters in set text book
Chapters 2, 3 & 4
Chapter 5
Chapters 6 to 11
Chapters 12
8/8/2019 L1 the Nature of Marketing
29/30
Ensure you are familiar with the various businessorientations that exist e.g. marketing orientation
Be able to differentiate between the four traditionalbusiness orientations, and the two advocated by Jobber &Fahy
Be able to outline the 3 key components of the marketingconcept, namely customer orientation, integrated effort andgoal achievement
Identify characteristics of market driven versus internallyorientated organisations
Outline what customer value is, and the elements thatcontribute to it
Key Concepts to Remember
8/8/2019 L1 the Nature of Marketing
30/30
Discuss must be, more is better and delighters withregards to creating customer satisfaction
Identify elements of both the original and serviceextended marketing mix
Outline hallmarks of an effective marketing mix
Discuss dimensions of market-driven management
Distinguish between effectiveness and efficiency, andtheir implications for business performance
Key Concepts to Remember