Chapter 16: Marketing: A State of Mind

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Chapter 16Marketing A State of Mind
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The Holistic View

• marketing is about how the firm views its
  customers it is a state of mind
• the scope of marketing extends to virtually
  everything that has the potential to affect
  customer satisfaction
• not all firms are well advanced along the road to
  customer centricity
• enlightened firms are paying much more attention
  to the emotional side of the value proposition
  and are exploring relationships with many
  stakeholders

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Figure 16-1 Leadership Leads to Shareholder Value
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Not Just a Business Concept

• the principles of a holistic view of marketing
  are equally applicable in international markets
  and in non-business settings
• while the principles may be the same, the route
  to success may be different in different markets
• not-for-profit organizations are increasingly
  accepting the principles of marketing
• one issue is often gaining acceptance for tee
  fact that not-for-profit organizations have
  competition

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Implementation

• the best strategic plans are useless unless the
  firm can implement those plans effectively
• the marketing function must be organized in a way
  that will lead to effective implementation
• usually coordinated by one manager, the marketing
  function may be organized
• geographically by sales territories
• by product specialization
• by types of customers served

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Evaluating Marketing Performance

• a marketing audit is a detailed review of the
  marketing function -- identifies problems
• often marketing effort is misdirected
• the 80-20 principle suggests that 20 percent of
  our customers give us 80 percent of our business
  -- they deserve our attention
• often companies do not know where their sales
  come from they lack effective marketing
  information systems

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Figure 16-2 The Circular Relationship among
Management Tasks
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Evaluating Marketing

• from the perspective of the individual firm,
  success usually means satisfying the needs and
  wants of its customers
• this may not be enough from the perspective of
  society as a whole
• marketing organizations are encouraged to take a
  broader societal view that strikes a balance
  between the wants of consumers, the goals of the
  firm, and the welfare of society

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Criticisms of Marketing

• marketing is often criticized for
• exploitation taking unfair advantage of people
  or of situations
• being pervasive some customers tire of it
• inefficiency using resources unnecessarily
• stimulating unwholesome demand promoting
  products and services that may be harmful
• representing what some consider to be
  inappropriate values
• engaging in illegal behaviour
• delivering poor customer service
• marketing is the most visible function in a
  company often it is the only one that extends
  its reach outside the organization

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Criticism of the Marketing Mix

• products are occasionally criticized for low
  quality or for being harmful or unnecessary
• pricing comes in for considerable criticism as
  consumers feel the value they get is low
• distribution is often felt to be too complicated
  and inefficient, with many hands involved
• marketing communications is criticized for being
  wasteful and misleading or for delivering very
  poor personal service

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Consumer Responses

• consumers responded to these concerns through an
  organized consumer movement
• they are today more prepared to protect
  themselves and to register complaints
• consumers also seem more willing to stop dealing
  with firms that do not deliver what they want in
  a way that is acceptable
• they are also turning their attention to broader
  social and environmental issues

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Government Responses

• governments at all levels have passed laws to
  protect consumers and to regulate marketing
• these laws protect the consumer against physical
  harm and against being misled
• much of the legislation is intended to ensure
  that the customer has enough information to make
  a reasoned purchase decision
• some public agencies regulate and control markets
  in the interest of the customer

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Business Responses

• business has responded to criticism with efforts
  to provide the consumer with better information
  and to make it accessible
• genuine efforts have been made to improve the
  quality of products and customer service
• businesses have established self-regulatory
  mechanisms to regulate advertising content
• many firms measure their quality of service and
  have set up customer service departments

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Ethics in Marketing

• businesses are occasionally faced with situations
  that may be considered unethical
• many firms have established codes of ethical
  behaviour that guide the actions of staff
• firms have an obligation to behave and advertise
  in a socially responsible manner
• many have taken steps to protect customer
  privacy, particularly in telemarketing and other
  forms of direct marketing

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What Lies Ahead?

• marketing will be affected by the changing
  demographic profile of Canada
• aging society smaller households etc
• customer values will continue to change and
  environmental matters will remain hot topics
• broadened perspectives more skeptical more
  difficult to please more balanced life-styles
• greater interest in entertainment more spending
  on out-of-home entertainment
• demands for better service

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What Lies Ahead?

• considerable impact of advanced technology
• Internet marketing
• fragmentation of the electronic media
• double-sided effect on service delivery
• facilitates monitoring of customer purchasing
• greater availability of marketing information
  will mean that customers can be targeted and
  resources used more efficiently

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Responding Strategically

• marketers will have to develop a truly
  customer-driven orientation -- put the customer
  first
• management must lead by example
• have to reward employees who recognize the
  importance of customer satisfaction
• organizations must stay in touch with their
  markets
• requires a complete understanding of customer
  needs
• have to understand the concept of value and how
  to offer customers the best value possible
• must listen closely to customers through research

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Responding Strategically

• marketers will have to learn to compete more
  effectively against new forms of competition
• firms will not be able to escape globalization
  and will have to accept the fact that competition
  and opportunities are global
• must recognize and understand the importance of
  value and pay greater attention to its creation

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Responding Strategically

• must be greater emphasis placed on delivering
  superior product and service quality and on
  satisfying customers
• everything that a firm does will have to be
  environmentally acceptable
• long-term success will involve building strong
  customer relationships