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Marketing Concepts –
Contemporary View
Total 30 Slides
1
► We
will take a look at concepts used in marketing.
► We will also take a look at how these concepts are
viewed today in the midst of rapid changes and
developments in communications technology
► These contemporary views are from Kotler:
Kotler, P., (2005) FAQs on Marketing: Answered by
the Guru of Marketing Marshall Cavandish,
Singapore
Total 30 Slides
2
Adapting Marketing to
Country/Region
► Marketing
shouldn’t be practiced the same
way in different countries
► However, fixed principles:
 Respect for centrality of customers,
competitors, distributors in planning strategy
 Apply segmentation
 For each target market, research customer
requirements
 Deliver value
Total 30 Slides
3
Marketing of Goods
What About Other Things?
► Marketing
formerly applied to mostly goods,
and lately, services
► Now marketing applied to:
 Non-profit making organizations (attract funds,
volunteers)
 To launch of campaigns
 Can also market experiences, information,
property, places, persons, organizations and
causes
Total 30 Slides
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Is Marketing the Same for…?
► Marketing
framework of STP (segmentation,
targeting & positioning) and 4Ps help us
analyse and plan for any market:
 Services, B2B
► However,
we need to take into account
characteristics of each and use additional
marketing tools: say, 7 Ps for service
Total 30 Slides
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Total 30 Slides
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Marketing Evolution
► Early
marketing was not much more than
economics: demand & supply
► First consisted of channels, advertising & personal
selling (little differentiated from selling)
► Stages:
 4Ps. Marketers later realised that they need to
understand the customer: 4Cs before they utilised the 4
Ps. 4Cs: customer value, customer costs, customer
convenience and customer communications
Total 30 Slides
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Marketing Evolution (Contd)
► Stages
(Contd)
 Marketers later realised that the 4Ps should be
preceded by STP strategic thinking
 Next: marketers realised that a company can
operate on 4 target levels: mass marketing, a
market segment, a market niche, individual
customer
 Later generalised into the skill set of managing
level, timing & composition of demand
 Next: marketing of other things, besides goods
Total 30 Slides
8
De-marketing
► May
be necessary to de-market rather than
market: adjust demand downwards
► Say, encourage to use less water
► Can use similar techniques as marketing
Total 30 Slides
9
Kotler’s view on biz opportunities:
► Biotech (drugs)
► Mobile phones
► Security (corporate/home)
► Niche biz (banks for Latinos,
children’s bookstore,
etc)
► Health care (lifestyle, drugs)
► Automation (fast-passing thru toll gates)
► Robots (lawn care, house cleaning)
► Outsourcing
► Storage systems
Total 30 Slides
10
Major characteristics of US
marketing (currently):
► Outsourcing
and becoming virtual
► More comparison with competitors
(benchmarking) & are ready to change
► Especially smaller ones, more
entrepreneurial
► Moving fast into direct marketing thru
catalogues, telemarketing, direct mail, webbased marketing
Total 30 Slides
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Role of marketing changing:
► 4Ps,
segmentation, targeting, positioning need to
be re-conceptualised because of changes:
 From aiming at mass market to individual prospect
 From product with long PLC to customised product
 From setting a price to buyers proposing a price
► Advent
of Internet, development of customer
databases have revolutionised marketing
► Gobalisation: need to practice marketing
differently, taking into account cultures & politics;
within countries, differences for different
industries, goods, services, B2B, etc
Total 30 Slides
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Organizations and the Effect of
Increase in Velocity of Change
► Successful
watching
companies must practice trend
► Companies
can benefit from imagining
different scenarios and planning responses
► Smart firms (Shell) appoint consultants to
do scenario-planning
Total 30 Slides
13
Mega-trends
► Due
to technology & globalisation,
companies can compete anywhere
► Major economic force: hypercompetition:
companies can produce more goods than
can be sold
► Hence more pressure on prices and
differentiation (though differentiation is
short-lived)
Total 30 Slides
14
Mega-trends according to Kotler:
From
Make-and-sell marketing
Owning assets
Mass marketing
Operating in marketplace
Marketing share
Customer attraction
Transaction marketing
Mediated marketing
Monologue
Single-channel marketing
Product-centric
Exploiting suppliers/distributors
To
Sense-and–respond marketing
Owning brands
Customised marketing
In cyberspace
Customer share
Customer retention & satisfaction
Relationship marketing
Direct marketing
Dialogue with customer
Multi-channel
Customer-centric
Total 30 Slides
Partnership
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Holistic Marketing
► Essentially
focus
► Calls for:
a move from product-focus to customer
 Company should see broader ways of serving customer
 Assess how all of its departments affect customer
satisfaction
 Assess impact of actions on all stakeholders
(marginalised stakeholders can create havoc)
 Take a larger view of the company’s industry
Total 30 Slides
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► PART
2
Total 30 Slides
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Reverse marketing
► Customers
taking more active role in
company’s product, pricing, place &
promotion
► E.g., reverse pricing, reverse advertising,
reverse distribution, reverse design
Total 30 Slides
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Prosumer
► Some
companies create an environment
where they act as workshops from which
customers create products and services they
want
► E.g., DELL
Total 30 Slides
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New Skills Required in Marketing
► Brand
building
► Customer Relationship Management
► Database marketing and mining
► Telemarketing
► Experiential Marketing
► Profitability analysis by product, segment,
channel, customer
Total 30 Slides
20
Experiential Marketing
► Marketers
need to think about designing
and delivering positive experience for the
customer Than simply selling
► E.g., Starbucks: “coffee experience”; Barnes
& Nobles – provides chairs and tables to
read books
► Marketers need to think through the
experience that the customers have
Total 30 Slides
21
Meta-markets
► It
facilitates all activities involved in
obtaining an item
► When buying a car, you need also to finance
it, buy insurance
► E.g., theknot.com, an online meta-market
for obtaining all things connected to a
wedding – from gown, to invitational gifts,
to wedding dinner, etc
Total 30 Slides
22
Challenges marketers face today
► Getting
better financial measures of the impact of
marketing programs. Coke is trying to do that –
need to estimate effect on P&L/justify before
getting marketing budget
► Developing more integrated info about important
customers
► Getting marketing to be the company’s
designer/driver of market strategy: too much of
marketing today is 1P instead of 4Ps (promotion).
The other 3Ps are done by others
Total 30 Slides
23
Challenges marketers face today
(Contd)
► Facing
lower cost/higher quality competitors
► Coping with increasing power and demands
of mega-distributors, e.g., Wal-Mart; many
of these carry their own brands that are
superior in quality and lower priced
Total 30 Slides
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Hyper-competition
► Due
to overcapacity. Customers are scarce
► Due also to companies planning for, say, 10%
growth when the overall market is expected to
grow 3%
► Will result in falling prices
► Defences:
 Building superior brand
 Developing loyal customers
 Acquiring/merging with other companies rationalise
supply
Total 30 Slides
25
Hyper-competition & Competition:
differences
Competitive market: company can usually sustain its
market position & competitive advantage
► Hyper: no sustainable competitive advantage
► Rapid technological change & globalisation an destroy
competitive advantage overnight
► Need for continuous improvement - Jack Welch: “Change
or die!”
► Companies can also learn from others through
benchmarking – how other companies customer retention,
product development;
► But needs creative benchmarking: not just copy, improve
►
Total 30 Slides
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Customers have more power
► Thru
Internet, they have a lot of info on
brands, prices, product quality, features and
service
► In contract to the past, when info was in the
hand of sellers and cost of info high
► Jack Welch: “Keep Giving the customer
more for less…while maintaining profit”
Total 30 Slides
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Deadly Sins of Marketing
► The










firm is:
Not sufficiently market-focused and customer-driven
Doesn’t fully understand target customers
Needs to better define competitors and monitor them
Not managed its relationships with stakeholders
Not good at finding opportunities
Marketing plans and planning processes deficient
Product/service policies need tightening
Brand-building & communications effort weak
Not well-organised to carry out marketing
Not used technologies maximally
Total 30 Slides
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Kotler’s major disappointments
► 80%
of new packaged consumer goods fail
and 30 % of B2B offerings fail (despite
having solid theories on product
development)
► Direct marketers willing to accept 1-2%
customer response rate
► Marketers not developed sufficient tools to
measure marketing ROI
Total 30 Slides
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Skills Needed by Marketing Managers
(according to Kotler)
Classic skills: market research, new product development,
product management, pricing, negotiating, communicating,
salesmanship and channel management
► Global orientation (to recognise new opportunities)
► Must know financial analysis
► Good understanding of info technology
► Know the strengths/weaknesses of new communications
modalities
► Broad understanding of mathematical/statistical tools
► Creative thinking
►
Total 30 Slides
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