MARKETING AND THE ORGANIZATION'S PURPOSE

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MARKETING AND THE ORGANIZATION'S PURPOSE
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You will understand

• The purpose of an organization is to get and keep
  customers.
• To keep customers you must deliver valued
  services, at attractive prices and conditions, to
  enough customers to make those prices and
  conditions possible.

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The Marketing Concept Operationalized

• Focus on customers who comprise a target market
• Identify markets to be satisfied
• Create products that satisfy

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The Marketing Concept Defined

• Creation of value for customers by means of the
  product and every aspect of its enjoyment and
  use, acquisition, and production.

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Determinants of Customer Delivered Value
Product value
Services value
Total customer value
Personnel value
Image value
Customer delivered value
Monetary cost
Time cost
Total customer cost
Energy cost
Psychic cost
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Value Chain or Value Delivery Network

• Primary Activities
• Inbound Logistics
• Operations
• Outbound
• Marketing and Sales
• Service

• Support Activities
• Firm Infrastructure
• Human Resource Management
• Technology Development
• Procurement

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Value Chain or Value Delivery Network
Firm infrastructure
Human resource management
Support Activities
Technology development
Procurement
Marketing and sales
Inbound logistics
Outbound logistics
Opera- tions
Service
Primary Activities
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Levi Strauss Value-Delivery Network
Order
Order
Order
Order
Du Pont (Fibers)
Milliken (Fabric)
Levis (Apparel)
Sears (Retail)
Customer
Delivery
Delivery
Delivery
Delivery
Competition is between networks, not
companies. The winner is the company with the
better network.
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Adoption of the Marketing Concept by Business

• Consumer goods manufacturers first
• Services next
• Commodity goods manufacturers someday

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Adoption of the Marketing Concept in Government
NPM

• A bold use of market-like mechanisms for those
  parts of the public sector that cannot be
  transferred directly into private ownership
• Intensified organizational and spatial
  decentralization of the management and delivery
  of services
• A constant rhetorical emphasis on the need to
  improve service quality
• An equally relentless emphasis on customer
  satisfaction

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Marketing Concept

• Spreading rapidly throughout the world

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Societal Marketing Concept

• The organizations task is to determine the
  needs, wants, and interests of target markets
  and to deliver the desired satisfactions more
  effectively and efficiently than competitors in a
  way that preserves or enhances the consumers and
  the society well-being.

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Hurdles to Adopting Marketing Concept

• Organized Resistance - people in some departments
  see marketing as a threat to their power in the
  organization
• Slow Learning - organizational learning comes
  slow
• Fast Forgetting - there is a strong tendency to
  forget marketing principles