Marketing in 21st Century: The Marketing Concept Essay Example

marketer finds a stated need and fills it.An anticipative marketer looks ahead into what needs customers may have in the near future. A creative marketer discovers and produces solutions customers didn’t ask for but to which they enthusiastically respond. Sony exemplifies a creative marketer because it has introduced many successful new products that customers never asked for or even thought were possible. Why is it supremely important to satisfy target customers? Because a company’s sales each period comes from two groups: new customers and repeat customers. One estimate is that attracting a new customer can cost five times as much as pleasing an existing one.

And it might cost sixteen times as much as to bring the new customer to the same level of profitability as the lost customer. Customer retention is thus more important than customer attraction. Integrated marketing: When all the company’s departments work together to serve the customer’s interests, the result is integrated marketing. Unfortunately, not all employees are trained and motivated to work for the customer. Integrated marketing takes place on two levels. First, the various marketing functions-sales force, advertising, customer service, product management, marketing research-must work together.

Second, the other departments must embrace marketing; they must also think customer. Marketing is not a department so much as a company wide orientation. To foster teamwork among all departments, a company should carry out internal as well as external marketing. External marketing is marketing directed at people outside the company. Internal marketing is the task of hiring, training, and motivating able employees who want to serve the customers well.

In fact, internal marketing must precede external marketing. It makes no sense to promise excellent service

before the ompany’s staff is ready to provide it. Managers who believe the customer is the company’s only true profit center consider the traditional organisation chart- a pyramid with the president at the top, management in the middle, and front-line people and customers at the bottom-obsolete. Master marketing companies invert the chart.

Profitability The ultimate purpose of the marketing concept is to help organizations achieve their objectives. In the case of private firms, the major objective is profit; in the case of nonprofit and public organizations, it is surviving and attracting enough funds.A company makes money by satisfying customer needs better than its competitors. Traditional Organizational Chart Modern Customer-oriented Organisational Chart Most companies do not embrace the marketing concept until driven by circumstances. These are

Sales Decline: When Sales fall, companies panic and look for answers. Today newspapers decline as people are more replying on Radio, TV and Internet for the news

• Slow Growth: Slow sales growth leads companies to search for new markets. They realize they need marketing skills to identify and select new opportunities
• Changing buying patterns: Many companies operate in markets characterized by rapidly changing customer wants. These companies need more marketing knowhow if they are to track buyers changing values
• Increasing Competition: Complacent industries may be suddenly attacked by powerful competitors. AT&T was quite complacent in a regulated market-naive Telephone Company until government allowed other companies to sell Telephone equipments. Companies in deregulated industries all find it necessary to build up marketing.
• Increasing Marketing Expenditures: Companies may find their expenditures for advertising, Sales, Promotion, marketing Research and Customer Service to be poorly done. Management then decides to take a serious audit to improve
  

its marketing Companies need to attract and retain customers through superior product offerings, which delivers the Customer satisfaction.

This is also influenced by other departments who must cooperate in delivering this Customer Satisfaction In the course to converting into marketing orientation, a company faces 3 hurdles Organized Resistance Slow Learning Fast forgetting Some company departments like R&D, Manufacturing, and Finance etc. believe a stronger Marketing department threatens their power in the organisation. Resistance is especially strong in the industries where Marketing is introduced for the first time-like law offices, colleges, deregulated industries and government offices. But in spite of resistance the Company president establishes a Marketing department, marketing talents are hired and seminars conducted, Marketing budget increased and Marketing planning and Control systems introduced.Companies face a difficult task in adapting ad slogans to International markets, many of which are interpreted wrongly

SOCIETAL MARKETING CONCEPT:

The Societal Marketing Concept holds that the Organizations task is to determine the needs, wants and interests of target markets and to deliver the desired satisfaction more effectively and efficiently than competitors in a way that preserves and enhances the consumers and the societies well being. It calls for social and Ethical considerations in marketing.

They must balance the conflicting criteria of Company profits, consumer want satisfaction and Public Interest.In an age of environmental deterioration, resource shortage, explosive population growth, world hunger and poverty and lack of Social Services Marketers needs to be sensitive on these issues Cause-Related Marketing: Activity by which a company with an image, product or service to market builds a relationship/partnership with a cause/causes for mutual benefit. This serves an opportunity for Corporate Reputation, raise Brand Awareness, increase Customer Loyalty, Press

coverage and Build Sales.

How Businesses and Marketing are Changing?Market place is changing as a result of major societal forces like Technological Advance Globalization Deregulation Customers increasingly want higher Quality, Lower Price, Service and Customization. They perceive fewer Brand Loyalty and Product differences.

They can obtain Extensive Product information from the Internet and other sources and shop intelligently. Brand manufacturers are facing intense competition from domestic and foreign brands, rising promotion costs and shrinking profits. Store based retailers are suffering from an over saturation of retailing.Small retailers are succumbing to growing power of Giant retailers and category killers. Store based retailers are suffering from competition from catalog houses, Direct mail firms, TV direct to customer ads, Telemarketing, Tele-shopping etc.

Company Response and Adjustments Here are some current trends

• Reengineering: Focusing on Functional departments to reorganize the key business processes, each managed by multidiscipline teams
• Outsourcing: From making everything inside to buying more goods and services outside, to obtain them cheaper and better.Few companies are outsourcing everything making them Virtual companies owning very few assets and therefore extraordinary rates of return
• E-Commerce: Making all products available on the Internet. Customers can now shop online from different vendors, have access to a lot of Pricing and Quality and Variety information. Click and pay systems are evolving along with B2B systems and B2C systems, with buyers and sellers in Real Time Systems
• Benchmarking: Adopting the best practices of World Class performers
• Alliances: Network of partners . Partner-Suppliers: From many suppliers to a few reliable suppliers who work more closely in Partnership relationships with the company
• Market-Centred: From organized around the product to organized around the Market segment
• Global and Local: From
  

being local to being Globally local and locally Global

Marketer responses and adjustments:

• Relationship Marketing: From focusing transactions to building Long Term profitable Customer Relationships. The 80-20 rule
• Customer Lifetime value: From making a profit on each sale to making Profits by managing Customer Lifetime value. Like the EDLP of Wal-Mart
• Customer Share: From focusing on gaining on Market Share to focusing on gaining Customer Mindshare by selling a large variety of goods and services, training employees to do Cross-selling and Up-selling
• Target Marketing: From selling to everyone to serving better well defined market segments
• Individualization: From selling the same offer in the same way in the target market to individualization and Customization. Customers designing their own products on the web pages and all
• Customer Database: Customer Knowledge Profiling, Data Mining, Data Warehousing, purchase preferences, demographics
• Integrated Marketing Communication: From relying on one communication tool like advertising and Promotion to blending several tools to deliver a consistent brand image to customers at every brand contact
• Channels as Partners: From thinking of intermediaries as Customers to treating them as Partners in delivering value
• Every Employee as a Marketer 10. Model based Decision making: From making decisions on intuition to basing decisions on models and facts.