Marketing Management

What are your favorites?

It may seem very strange to start the first chapter of a textbook with a question. However, it is a highly pertinent one. Before reading the Introduction take a few minutes to answer the following brief questions:

◆      What are your three favorite movies? Why are they your favorite movies? What influenced you to go to see them?

◆      What are your three favorite cars? Why are they your favorite cars? What influenced you to go to buy them? If you did not buy them, were they a gift to you?

◆      Which is your favorite place? Why is it your favorite place? Did anyone or anything influence you to be at that place for the first time?

Encapsulated within those brief questions are the basics of marketing. By the time you reach the end of this textbook you will know exactly how pertinent these questions are to you and your understanding of marketing.

Introduction

The aim of this chapter is to ‘set the scene’; to consider what marketing really is to you and me. It discusses what marketing comprises, its development and how it affects our daily lives. Marketing, as we shall see throughout this text, is composed of many elements from numerous subject areas and disciplines. For instance, economics, sociology, psychology, statistics and mathematics, as well as politics and the law, have all influenced marketing in one form or another.

The actual term ‘marketing’ may be a creation of recent history, often associated with the dawn of the 20th century. However the actions of marketing date back thousands of years. We know from excavations of caves that early civilizations used ‘advertising’ to inform other members of the community of events and issues, indeed also to warn them of perils in the area. Equally customers or consumers, as we know them, are far from being a recent phenomenon. Customers are as old as the first transaction between two people.

The social, economic, political and technological changes during the 20th century revolutionized the way we lived and worked. Moreover these ‘revolutions’ provided the means or the platform for an equally dramatic change in the marketing of products and services linked to dynamic competitive environments. The 21st century obviously remains an unknown quantity. Already in its early years this century has witnessed tremendous growth in certain business sectors, decline in others, increased competition in both home and international markets, societal change and geopolitical turmoil. Where the next 20 or so years will lead us is anyone’s guess. However, marketing, in one form or another, will play an integral role in reacting to change and even shaping change.

The origin of marketing:

 Marketing is something that affects every one of us every waking moment of our lives – even though we may not necessarily be conscious of it. From that very moment we stir out of deep sleep, turn on the radio or television, and walk around the house, we are bombarded by marketing messages. They are not always in the form of advertisements beaming from the radio or television, Think of the packaging in your kitchen or bath-room. Even on non-commercial radio and television stations there are still marketing messages, in the form of publicity and public relations. Even before we leave the house we have already seen or heard hundreds of marketing messages. Then it just explodes – newspapers, magazines, billboards and posters. There are messages everywhere, invading every aspect of our lives.

All this relates to marketing, but how do we define marketing? This is not as easy as one might think. Indeed as Cooke, Rayburn and Abercrombie (1992) suggested, ‘after about 80 years of formal marketing education (thought) there is no consensus on the definition of market’. Has this perspective changed? No. It is perhaps a scary thought that a subject that is a major course at the vast majority of universities has no hard and fast definition. However, being able to debate a definition for marketing allows us to consider the subject as being flexible and dynamic, just like the world we live in.

In the next section we investigate some of the various definitions of marketing, drawing on a range of subject areas. It may well turn out that there is no one definition that fits all aspects of marketing. As marketers we may have to be flexible in our understanding of the subject, and its relationship with us both as individuals and a society, especially within a turbulent macro environment.

An economics approach

With an economics approach the emphasis is on products (usually referred to as goods) and services, sources of supply, the most commonly used channels of distribution and the functions performed during the marketing process (Cooke et al. 1992).

Three definitions can be provided on the basis of the economics approach:

Marketing is the performance of business activities directed toward, and incident to, the flow of goods and services from producer to consumer or user.

(American Marketing Association (AMA) 1948)

Marketing embraces all the business activities involved in getting commodities of all kinds, including services, from the hands of producers and manufacturers into the hands of the final consumers. All the business steps through which goods progress on their way to final consumption is the concern of marketing.

“The American marketing association offers the following formal definition: Marketing is an organizational function and a set of processes for creating, communicating and delivering value to customers and for managing customer relationship in ways that benefit the organization and its stakeholders.”

Scope of Marketing:

It   is   common   knowledge   that   marketing   has   lately   developed   into   a separate discipline that is being taught at universities now. When did it really come   into   existence?   This   century,   last   century,   or   in   the   Middle   Ages?   – Wrong on all three counts.

The transfer of goods from one person to another was probably one of our   earliest social acts.  Whether    through   violence    or barter, this transfer established that few people can satisfy all their desires alone. The inability to produce everything desired creates reliance on others for both necessities and luxuries. As societies grow more complex, so does the transfer of goods.

The basic motive for trading is that someone has something you want more than what you already have. When that someone is willing to exchange what you want for what you have, a mutually satisfactory transaction can be arranged. Generally speaking, then, trade is the exchange of surplus items for shortages of    items.  The    reasons   for having    surplus   items   range   from geographic   and   resource   variations   to   division   and   amount   of   labor,   skill variation, and differences in taste. One group or person may create a surplus of some product in the hope of profitably exchanging it for other products.

As   society   and   production   expanded, so   did   the   limits   of   trade,   the range of goods, and the distance between the traders. It became increasingly difficult   for   the producers    to  locate  each    other   and   arrange    mutually satisfactory   exchanges   without   the   help of   intermediaries   or   "middlemen." These intermediaries, in the role of bringing together interested parties, must perform a variety of tasks which can be called marketing.

As defined by the American Marketing Association, marketing is "the performance of business activities directed toward, and incident to, the flow of   goods     and services from     producer     to  consumer      or  user   "  Marketing, therefore, is made up of such physical activities as transporting, distributing, storing,   and   selling   goods,   and   of   the  decisions   which   must   be   reached   by individuals   or   groups   who   want   to   move   goods   from   production   to   use.   Of course,     not   all producers     engage     in every   marketing      activity.   The local carpenter   in   Guatemala   or   the   supermarket   manager   in   Japan   does   not   do product planning; most retail stores around the world have few or no storage facilities.   However,   most   products   are repeatedly   subjected   to   all   marketing operations. In addition to an analysis of these activities, marketing involves understanding the consumer circumstances and attitudes that determine why certain people want certain products.

Marketing trends, activities, and organizations are constantly changing and     developing.  In   the   role  of   bringing together  interested parties,   the intermediary  may     also   be    involved     in  grading,     financing,     assembling, packaging, refining, or altering the form of the goods Indeed, a large portion of   the   working   population   in   many   countries   is   involved   in   some   form   of marketing.  In West Germany today,    for example,     manufacturing   and   the marketing activities of retail and wholesale trade account for one-third of the national   income,   while   twenty-five   percent   of   the   work forces   are   engaged   in full-time marketing activities.

The   contribution   of   marketing   to   society   is   a   subject   of   controversy among economists. Contributions such as refining, transporting, assembling, and packaging      are   considered     productive;  speculating,  storing,    accepting commissions, and merchandising activities     such as   advertising  are considered parasitic and of little value to society

The general belief is that prime costs of distribution should be eliminated and supplemental cost excesses should be reduced. Supplementary costs   of   distribution such   as   packaging,   storing,   and   selling   are   generally considered to be continuations of the production process,  and    are   thus acceptable as an added value to the product. In the free enterprise system, the full   range   of   marketing   activities   operates with   little   control.   Other   more controlled economies regulate and limit some of these functions.

Capitalist economies do acknowledge that marketing has its excesses, as in cases where a product is stored for an undue period of time merely to raise the price.  Consumerism has arisen out of a belief that consumers have rights   which   are   often   abused.   People   like   consumer   advocate   Ralph   Nader have fought to have laws enacted which would protect these rights.

On the whole, however, functions can continue only if they perform a service and fulfill a need. If unnecessary marketing activities raise the cost of goods   above   that   of   the   competition,   the   product   will   be   priced   out   of   the market. The corollary to this is that marketing functions will only produce a profit—the basic motive for doing business—if they provide a service worth the money. It is argued that almost all marketing activities thus contribute to the real value of a product. Whether or not this is true, the aim of this text is to explore those marketing activities and functions which do exist and which are practiced.

The following questions face those involved in marketing: How should the   product   be   designed?   How   should it   be   packaged?   What   retail   and/or wholesale channels should be used? Is advertising advisable? If so, how much and what kinds? What prices should be set? Will it sell, and to whom?

Although marketing activities have expanded tremendously in the past hundred years,   there was    little formal study    of them    until the   past few decades. Today, there   are many publications on the various aspects   of marketing   and colleges   give   courses and   degrees   in this   field.   Marketing research   has   developed   into   a   highly specialized   activity   employing   tens   of thousands   of   people   around   the world. There   is general   agreement   among marketing people that, in many cases   and   countries, marketing activities account for more than half the cost of the product to the consumer. In many countries, those engaged in marketing activities outnumber those engaged in manufacturing or production.

We have noted that, in general, marketing directs the flow of goods and services from producers to consumers or users. Marketing is not confined to one particular type of economy; goods in all but the most primitive societies must be marketed. Indeed, a broader concept of marketing does not limit its application   to   business   enterprises.  Schools,   hospitals,   libraries,   and   many other services must also be marketed to be used.

Importance of Marketing:

Marketing is a very important aspect in business since it contributes greatly to the success of the organization. Production and distribution depend largely on marketing. Many people think that sales and marketing are basically the same. These two concepts are different in many aspects. Marketing covers advertising, promotions, public relations, and sales. It is the process of introducing and promoting the product or service into the market and encourages sales from the buying public. Sales refer to the act of buying or the actual transaction of customers purchasing the product or service.

Since the goal of marketing is to make the product or service widely known and recognized to the market, marketers must be creative in their marketing activities. In this competitive nature of many businesses, getting the product noticed is not that easy.

Strategically, the business must be centered on the customers more than the products. Although good and quality products are also essential, the buying public still has their personal preferences. If you target more of their needs, they will come back again and again and even bring along recruits. If you push more on the product and disregard their wants and the benefits they can get, you will lose your customers in no time. The sad thing is that getting them back is the hardest part.

Marketing Promotes Product Awareness to the Public

It has already been mentioned in the previous paragraph that getting the product or service recognized by the market is the primary goal of marketing. No business possibly ever thought of just letting the people find out about the business themselves, unless you have already established a reputation in the industry. But if you are a start-out company, the only means to be made known is to advertise and promote. Your business may be spending on the advertising and promotional programs but the important thing is that product and company information is disseminated to the buying public.

Various types of marketing approaches can be utilized by an organization. All forms of marketing promote product awareness to the market at large. Offline and online marketing make it possible for the people to be educated with the various products and services that they can take advantage of.

A company must invest in marketing so as not to miss the opportunity of being discovered. If expense is to be considered, there are cost-effective marketing techniques a company can embark on such as pay-per-click ads and blogging.

Marketing Helps Boost Product Sales

Apart from public awareness about a company’s products and services, marketing helps boost sales and revenue growth. Whatever your business is selling, it will generate sales once the public learns about your product through TV advertisements, radio commercials, newspaper ads, online ads, and other forms of marketing. The more people hear and see more of your advertisements, the more they will be interested to buy.

If your company aims to increase the sales percentage and double the production, the marketing department must be able to come up with effective and strategic marketing plans.

Marketing Builds Company Reputation

In order to conquer the general market, marketers aim to create a brand name recognition or product recall. This is a technique for the consumers to easily associate the brand name with the images, logo, or caption that they hear and see in the advertisements.

For example, McDonalds is known for its arch design which attracts people and identifies the image as McDonalds. For some companies, building a reputation to the public may take time but there are those who easily attract the people. With an established name in the industry, a business continues to grow and expand because more and more customers will purchase the products or take advantage of the services from a reputable company.Marketing plays a very essential role in the success of a company. It educates people on the latest market trends, helps boost a company’s sales and profit, and develops company reputation. But marketers must be creative and wise enough to promote their products with the proper marketing tactics. Although marketing is important, if it is not conducted and researched well, the company might just be wasting on expenses and time on a failed marketing approach.

What is marketed??

Marketing people market 10 types of entities: goods, services, events, experiences, persons, places, properties, organizations, information, and ideas. Let’s find out these categories in details:

Goods:

Physical goods constitute the bulk of most countries production and marketing efforts. Each year Indian companies market cars, trucks, electronic goods, industrial goods, personal care goods and many other mainstays of a modern economy

Services:

As economic advance, a growing proportion of their activities focuses on the production of services. Service include the work of airlines, hotels, car rentals firms, barbers and beauticians, maintenance and repair people, and accountants, bankers, lawyers, engineers, doctors and management consultant. Many market offerings consist of a variable mix of goods and services. At a fast food restaurant, for example, the customer consumes both a product and a service.

Events:

Marketers promote time based events, such as major trade shows, artistic performances, and company anniversaries. Global sporting events such as Olympics and the world cup are promoted aggressively to both companies and fans.

Experiences:

By orchestrating many services and goods, a firm can create, stage, and market experiences. An amusement park represents experiential marketing: customers, by taking different rides in the amusement park, enjoy the thrill provided by these experiences. For example, “bau ji da dhaba” a theme restaurant that creates the ambience of village in Rajasthan. 

Persons: celebrity marketing is very common and major business. Most of the firms are taking advantages from celebrity marketing. Think of celebrities such as Sachin Tendulkar, M.S. Dhoni, Shahrukh khan, Salman khan are big brands themselves.

Places: 

Cities, states, regions, and whole nation compete actively to attract tourists, company, plants, and new residents. Place marketers include economic development specialists, real estate agents, commercial banks, local business associations and advertising and public relation agencies.

For examples, in software industry Bangalore and Gurgaon are positioned as information technology hub. Kerala is marketed as God’s own country. Even government of India is positioning India as “INCREDIBLE INDIA” for tourism.

Properties:

Properties are intangible rights of ownership of either real property or financial property (stocks). Properties are bought and sold and these exchanges require marketing.

Organizations:

Organizations actively work to build a strong favorable and unique image in the minds of their targeted people. So they position themselves accordingly. Corporate identity campaigns are the result of intensive market research programs.

Information:

Information is essentially what books, schools and university produce, market, and distribute at a price to parents, students, and communities. The production, packaging and distribution of information are some of our society’s major industries. Even companies that sell physical products attempt to add value through the use of information.

Ideas:

Every market offering includes a basic idea. Charles Revson of Revlon once observed:

“In the factory, we make cosmetic; in the store we sell hope”. Products and services are platforms for delivering some idea or benefit. Social marketers are busy promoting such ideas by creating awareness about AIDS, encouraging family planning, and discouraging smoking, which fall in the realm of social networking.

Marketing philosophy

What philosophy should guide a company marketing and selling efforts?  What relative weights should be given to the interests of the organization, the customers, and society?  These interest often clash, however, an organization’s marketing and selling activities should be carried out under a well-thought-out philosophy of efficiency, effectiveness, and socially responsibility.

Five orientations (philosophical concepts to the marketplace have guided and continue to guide organizational activities:

1.         The Production Concept

2.         The Product Concept

3.         The Selling Concept

4.         The Marketing Concept

5.         The Societal Marketing Concept

The Five Concepts Described

The Production Concept

This concept is the oldest of the concepts in business.  It holds that consumers will prefer products that are widely available and inexpensive.  Managers focusing on this concept concentrate on achieving high production efficiency, low costs, and mass distribution.  They assume that consumers are primarily interested in product availability and low prices.  This orientation makes sense in developing countries, where consumers are more interested in obtaining the product than in its features.

The Product Concept

 This orientation holds that consumers will favor those products that offer the most quality, performance, or innovative features.  Managers focusing on this concept concentrate on making superior products and improving them over time. They assume that buyers admire well-made products and can appraise quality and performance.  However, these managers are sometimes caught up in a love affair with their product and do not realize what the market needs.  Management might commit the “better-mousetrap” fallacy, believing that a better mousetrap will lead people to beat a path to its door. 

 The Selling Concept

 This is another common business orientation. It holds that consumers and businesses, if left alone, will ordinarily not buy enough of the selling company’s products.  The organization must, therefore, undertake an aggressive selling and promotion effort.  This concept assumes that consumers typically show buying inertia or resistance and must be coaxed into buying.  It also assumes that the company has a whole battery of effective selling and promotional tools to stimulate more buying. Most firms practice the selling concept when they have overcapacity.  Their aim is to sell what they make rather than make what the market wants.

 The Marketing Concept

This is a business philosophy that challenges the above three business orientations.  Its central tenets crystallized in the 1950s.  It holds that the key to achieving its organizational goals (goals of the selling company) consists of the company being more effective than competitors in creating, delivering, and communicating customer value to its selected target customers. The marketing concept rests on four pillars:  target market, customer needs, integrated marketing and profitability.

The Societal Marketing Concept

This concept holds that the organization’s task is to determine the needs, wants, and interests of target markets and to deliver the desired satisfactions more effectively and efficiently than competitors (this is the original Marketing Concept).  Additionally, it holds that this all must be done in a way that preserves or enhances the consumer’s and the society’s well-being.

 This orientation arose as some questioned whether the Marketing Concept is an appropriate philosophy in an age of environmental deterioration, resource shortages, explosive population growth, world hunger and poverty, and neglected social services

Core Marketing Concept

Needs, Wants, and Demands

Needs wants and demands are a part of basic marketing principles. Though they are 3 simple worlds, they hold a very complex meaning behind them along with a huge differentiation factor. In fact, a product can be differentiated on the basis of whether it satisfies a customers needs, wants or demands.

Needs -Human needs are the basic requirements and include food clothing and shelter. Without these humans cannot survive. An extended part of needs today has become education and healthcare. Generally, the products which fall under theneeds category of products do not require a push. Instead the customer buys it themselves. But in today’s tough and competitive world, so many brands have come up with the same offering satisfying the needs of the customer that even the “needs category product” has to be pushed in the customers mind.

Example of needs category products / sectors – Agriculture sector, Real Estate (land always appreciates), FMCG, etc.

Wants – Wants are a step ahead of needs and are largely dependent on the needs of humans themselves. For example, you need to take a bath. But i am sure you take baths with the best soaps. Thus Wants are not mandatory part of life. You DONT need a good smelling soap. But you will definitely use it because it is your want.

Example of wants category:  products / sectors – Hospitality industry, Electronics, Consumer Durables etc, FMCG, etc.

Demands – You might want a BMW or a Mercedes for a car. You might want to go for a cruise. But can you actually buy a BMW or go on a cruise? You can provided you have the ability to buy a BMW or go on a cruise. Thus a step ahead of wants is demands. When an individual wants something which is premium, but he also has the ability to buy it, then these wants are converted to demands. The basic difference between wants and demands is desire. A customer may desire something but he may not be able to fulfill his desire.

Example of demands: Cruises, BMW’s, 5 star hotels etc.

Understanding customer needs and want is not always simple. Some customers have needs of which they are not fully conscious, or they cannot articulate these needs, or they use words that require some interpretation. What does it means when the customer asks for a powerful lawnmower, a fast lathe, attractive clothing, or a comfortable hotel? The marketer must probe further. We can distinguish among five types of need:

• Stated needs (customer wants an economical car)

• Real needs (customer wants a car whose operating cost is low)

• Unstated needs (customer expects good service from the dealer)

• Delight needs (customer would like the dealer to add some luxury features in the car)

• Secret needs (customer wants friends to see him as a savvy consumer)

By definition, a customer is someone who buys services or goods from someone else while a consumer is someone that consumes a certain product or commodity. In the concept of Economics, a consumer can either be a single person or an entire organization that uses a certain type of service. Consumers can also be any form of organism that devours or eats something, as in the field of Science and Ecology.
For example, a customer is best exemplified by a coffee shop that buys a coffee maker, from a coffee maker manufacturer. This means that the restaurant buys the said equipment, for the benefit of its patrons or guests. In this connection, the restaurant is clearly pictured as a customer and not the actual consumer. However, in a similar scenario wherein you directly go to the coffee maker manufacturer and buy their product so that you can bring it home for your family’s use at home, then you are the real consumer.
Simply said, if you are going to use a particular product for purposes other than your own consumption, like for commercial usage, then you are considered a customer.
However, according to the Consumer Protection Act of India in 1986, the term, ‘consumer’ has a broader, meaning to include those who use a product or commodity for a living. And so, if you are the sole proprietor of your company and you purchased the coffee maker under your name, then you can still be considered a consumer according to this Act.
Furthermore, the Act expands the consumer definition even more by stating that a consumer does not need to buy products for personal usage to be considered as one, rather the mere thought or intent of buying already turns you into a consumer.
Consumer Goods Definition:
Product Range:
Types of Consumer Goods
Innovation in consumer goods:
To create the right marketing mix, businesses have to meet the following conditions:
For example, a company like Kellogg's is constantly developing new breakfast cereals - the product element is the new product itself, getting the price right involves examining customer perceptions and rival products as well as costs of manufacture, promotion involves engaging in a range of promotional activities e.g. competitions, product tasting etc, and place involves using the best possible channels of distribution such as leading supermarket chains. The product is the central point on which marketing energy must focus. Finding out how to make the product, setting up the production line, providing the finance and manufacturing the product are not the responsibility of the marketing function. However, it is concerned with what the product means to the customer. Marketing therefore plays a key role in determining such aspects as:
The product range and how it is used is a function of the marketing mix. The range may be broadened or a brand may be extended for tactical reasons, such as matching competition or catering for seasonal fluctuations. Alternatively, a product may be repositioned to make it more acceptable for a new group of consumers as part of a long-term plan.

 

Elements of Marketing Mix

1. Product

2. Price

3. Place

4. Promotion

The marketing mix of Manchester United

Four C’s of Marketing Mix
Commodity
Cost
Convenience
Communication
Marketing Research vs. Market Research
The Value of Information
The Value of Information

• The ability and willingness to act on the information.

• The accuracy of the information.

• The level of indecisiveness that would exist without the information.

• The amount of variation in the possible results.

• The level of risk aversion.

• The reaction of competitors to any decision improved by the information.

• The cost of the information in terms of time and money.

The Marketing Research Process

1. Define the problem

1. Determine research design

1. Identify data types and sources

1. Design data collection forms and questionnaires

1. Determine sample plan and size

1. Collect the data

1. Analyze and interpret the data

1. Prepare the research report

Problem Definition
The objective of the research should be defined clearly. To ensure that the true decision problem is addressed, it is useful for the researcher to outline possible scenarios of the research results and then for the decision maker to formulate plans of action under each scenario. The use of such scenarios can ensure that the purpose of the research is agreed upon before it commences.
The objective of the research should be defined clearly. To ensure that the true decision problem is addressed, it is useful for the researcher to outline possible scenarios of the research results and then for the decision maker to formulate plans of action under each scenario. The use of such scenarios can ensure that the purpose of the research is agreed upon before it commences.
of organization. Marketing is the process of developing and implementing a plan to identify, anticipate and satisfy consumer demand, in such a way as to make a profit. The two main elements of this plan are market research to identify and anticipate customer requirements and the planning of an appropriate marketing mix to meet these requirements. Market research involves gathering and recording information about consumers, market, product, and the competition in an organized way. The information is then analyzed and used to inform marketing decisions. There are three main ways of gathering information for market research: 
1. From internal information already held by an organization, e.g. details of existing customers and their spending habits.
2. External primary information - i.e. information collected at first hand by interviewing customers and potential customers to get their views about a company, products and services. 
3. External secondary information - using published sources of information e.g. those produced by marketing organizations about products, markets and brands. 
Marketing planning can then be used: 
1. To assess how well the organization is doing in its markets. 
2. To identify current strengths and weaknesses in these markets. 
3. To establish marketing objectives to be achieved in these markets. 
4. To establish a marketing mix for each market designed to achieve organizational objectives. 
Service organizations like the Inland Revenue and Abbey will carry out marketing to find out about the sort of service that their customers and clients require in order creating an appropriate marketing plan. Manufacturing organizations like Cadbury Schweppes, Corus, Audi and Nissan will carry out product research in order to create an appropriate marketing plan for their products (as well as associated services). 
A simple definition of market research is 'keeping those who provide goods and services in touch with the needs and wants of those who buy the goods and services.'
3 Product Planning and Development: Product planning and development are essential components in how a business creates products and refines them before offering them for sale. Planning and development are two distinct phases of the product creation process. Planning requires information gathering from multiple business departments including consumer input and competition information. Development is a partnership between the marketing and engineering departments, which work together to create a final product that meets consumer needs in the most effective way possible.
3 Product Planning and Development: Product planning and development are essential components in how a business creates products and refines them before offering them for sale. Planning and development are two distinct phases of the product creation process. Planning requires information gathering from multiple business departments including consumer input and competition information. Development is a partnership between the marketing and engineering departments, which work together to create a final product that meets consumer needs in the most effective way possible.
Product development is the process by which a business builds initial prototypes of a given product, determines a product's functional specifications and which materials create the strongest product for the most economical price. The engineering department and marketing department should work closely during this phase of product development to ensure the product the engineering department creates is the same product the marketing department is planning to unveil to the public. This also helps ensure the design of the product is in line with the determinations of the product planning phase. The final product must meet consumer needs in the way the product planning phase envisioned it.

4. Buying and Assembling:

Buying: means purchase of raw materials for use in manufacture of finished goods for
resale.
4. Buying and Assembling:

Buying: means purchase of raw materials for use in manufacture of finished goods for
resale.
4. Buying and Assembling:
Buying: means purchase of raw materials for use in manufacture of finished goods for
resale.
Buying: means purchase of raw materials for use in manufacture of finished goods for
resale.
Assembling: means collection of specific type of products from different buyers under a
common roof.

Assembling: means collection of specific type of products from different buyers under a
common roof.

Standardization refers to the process of setting certain norms or standards for a
product with regard to shape, size, color, quantity, quality, weight etc.
It helps in ensuring that product confirms to standards.

Grading: refers to the process of classification of products into different categories on
the basis of quality, size etc. Grading is done generally for agricultural products-fruits
and vegetables.
Graded products are of uniform quality and it becomes easy to market. Standardization refers to the process of setting up basic measures or standards to which the products must conform and taking steps to ensure that the goods actually produced adhere to these standards. Standards reflect desirable features of a product in terms of its design, weight, color, etc. Standardization means that goods are of a specified and uniform quality.
Standardization refers to the process of setting certain norms or standards for a
product with regard to shape, size, color, quantity, quality, weight etc.
It helps in ensuring that product confirms to standards.
Grading: refers to the process of classification of products into different categories on
the basis of quality, size etc. Grading is done generally for agricultural products-fruits
and vegetables.
Graded products are of uniform quality and it becomes easy to market. Standardization refers to the process of setting up basic measures or standards to which the products must conform and taking steps to ensure that the goods actually produced adhere to these standards. Standards reflect desirable features of a product in terms of its design, weight, color, etc. Standardization means that goods are of a specified and uniform quality.
Grading: refers to the process of classification of products into different categories on
the basis of quality, size etc. Grading is done generally for agricultural products-fruits
and vegetables.
Graded products are of uniform quality and it becomes easy to market. Standardization refers to the process of setting up basic measures or standards to which the products must conform and taking steps to ensure that the goods actually produced adhere to these standards. Standards reflect desirable features of a product in terms of its design, weight, color, etc. Standardization means that goods are of a specified and uniform quality.
differentiate it from products of competitors.
The American Marketing Association (AMA) defines a brand as a "name, term, sign, symbol or design, or a combination of them intended to identify the goods and services of one seller or group of sellers and to differentiate them from those of other sellers.
The American Marketing Association (AMA) defines a brand as a "name, term, sign, symbol or design, or a combination of them intended to identify the goods and services of one seller or group of sellers and to differentiate them from those of other sellers.
the product package to provide information about the product such as manufacturer of the
product, date of manufacture, date of expiry, its ingredients, how to use product and its
handling.
Functions:
· It describes the product, its usage, contents, date of manufacture and expiry etc.
· It helps in grading of the products.
· It helps in product identification.

· It supports product promotion.
· It helps in product identification.
· It supports product promotion.
· It supports product promotion.
 In today’s competitive environment, customer support services play an important role in marketing. Services such as after sale services,maintenance services, handling customer complaints provides satisfaction to customers and also helps in building product loyalty.
prospective customers to buy a product. Promotion is the element of the marketing mix which is entirely responsible for communicating the marketing proposition. Marketers work hard to create a unique marketing proposition for their product or service. McDonald's is about community, food and enjoyment. Audi is about the driver experience and technology

Think of it like a cake mix, the basic ingredients are always the same. However if you vary the amounts of one of the ingredients, the final outcome is different. It is the same with promotions. You can integrate different aspects of the promotions mix to deliver a unique campaign. Now let's look at the different elements of the promotions mix

Think of it like a cake mix, the basic ingredients are always the same. However if you vary the amounts of one of the ingredients, the final outcome is different. It is the same with promotions. You can integrate different aspects of the promotions mix to deliver a unique campaign. Now let's look at the different elements of the promotions mix

And also online promotions
(ii) Physical movement of goods from producers to consumers through means of transport, storage and warehousing, inventory control.

•  Relationship Building

•  Service Marketing

•  Informational Networking

• What is the mission of the organization?

• What are the abilities and preferences of the job seekers?

•  Who is the audience?

• What services will be offered to satisfy the customers’ needs?

•  What are the economic trends?

• What are the outcomes expected?

•  What is the message to the customers?

•  What are the resources?

• What is the promotional plan?  What tools will be used?

• How will success be determined?

Success is determined by evaluating customer satisfaction.  An organization must put in place mechanisms to evaluate whether or not its customers are satisfied with the services offered and delivered.  Before determining indicators of success, an organization will need to evalu-ate current marketing efforts.  This will help an organization to see what is working and what is not. Evaluating current activities will lay a solid foundation for growth and success. Answering these questions may involve several interested stakeholders.  The following checklist which is found in the appendix of this chapter is a useful tool for tracking efforts to develop answers to these marketing questions.

• Conducted a staff meeting to determine strategies to improve morale.

• Shifted budget resources to slight pay increases, staff development opportunities, and created a part-time position to provide marketing support to employment specialists.

• Scheduled bi-weekly staff meetings to address successes and issues.

• Person-centered services and programs designed and delivered based on consumer information and input.  People with significant disabilities will share their views, opinions, and experiences which will directly drive the services that they receive.

• Services and programs will be available to individuals within their own communities. Thus, increasing accessibility and availability of the competitive market place and the employment and service options. Increased opportunities to actually choose services and be involved in the service delivery process.

• Increased involvement in the overall management and operation of the service provider’s organization.

• Employment opportunities available through the organization’s improved relationships with businesses (this mutually benefits all customers and the organization).

• Increased opportunity for independent and key players to assist organizations with the assessment of quality and the types of services provided within a specific program in the community. This ensures continued responsiveness and competitiveness.

• Assistance with understanding the ADA and how it will contribute to efforts to diversify the workforce.

• Exposure to technology goods and services which may assist their operational performance for all employees, including workers with disabilities.

• Availability of services to assist in recruitment, interviewing, testing, and accessibility as well as a resource related to specific personnel issues.

• Ability to reduce cost through appropriate tax incentives.

•  Quality workers who are reliable and meet the employment needs of the business.

•  Ability to develop a one-to-one relationship with organization promoting and providing quality employment resources.

• Ability to cut cost by job restructuring recommendations

• A greater demand for employment services, at both a job seeker and employer level.

• A more supportive community which includes legislators, foundations, and businesses.

• An increase in status and reputation in the community and among customers.

• An increase in customer oriented staff and an increase in staff morale.

• Competitors will be trying to be like your organization.

• Job seekers and employers will become promoters for staff and the organization.

• Greater resources may be realized.

Marketing manager
A manager whose primary task is to manage the marketing resources of a product or business. A marketing manager can be in charge of a single product or brand, or can be a general manager responsible for a broad array of products and services. A business can employ multiple marketing managers, and small businesses are less likely to require the services of such a professional.
THE ROLE OF THE MARKETING MANAGER

• Instilling a marketing led ethos throughout the business

• Researching and reporting on external opportunities

• Understanding current and potential customers

• Managing the customer journey (customer relationship management)

• Developing the marketing strategy and plan

• Management of the marketing mix

• Managing agencies

• Measuring success

• Managing budgets

• Ensuring timely delivery

• Writing copy

• Approving images

• Developing guidelines

• Making customer focused decisions

Objectives – what do you want to achieve? 
Strategy – how are you going to get there?  
Tactics - what are the details of the strategy?
Actions – who is going to do what, and by when? 
Controls – how are you going to measure success?

Qualities of Marketing Managers
Quite frequently, a company's success or failure is directly tied to the effectiveness of its marketing efforts. Whether a company has a dedicated marketing manager, or the owner wears the marketing manager hat, this role is one of the most critical functions in any company.
Over the years with Polaris, I have worked with many marketing managers and small business owners, and I believe that I have a unique perspective on their performance. I have observed and worked with great, mediocre and (I'm sorry to say) terrible marketers in this critical role. Here, without a doubt, are the first five of the ten most important qualities of a great marketing manager.
1. A Vision Creator
Great marketing managers are vision creators. One of the most important steps in introducing a product or service successfully to the marketplace is to create a clear, focused concept of their product or service. To accomplish this, marketing managers must be able to wade through the products or services that their company sells, find its edge in the marketplace, and simplify its features and benefits so that they are easily understood. They don't necessarily need to create the exact words used in the pitch, but it is important for them to be able to communicate the vision clearly to others.
This ability to communicate the vision clearly will give the creative resources, internal sales people, senior management, the production team people, and all the other people who actually perform the work or sell the product a clear understanding of what to do when working on anything related to the product. It will also ensure that they are all communicating the same thing so the campaign does not become disjointed along the way. For example, a marketing manager with a clear vision may say to their advertising agency, "Our Company will be selling a new product. This product will be more expensive than the competition, but it's a more durable product and it's easier to use - saving time and money. This is our edge in the marketplace." When the agency receives this type of focused direction, they will have a clear picture of how to create effective marketing materials.
Great marketing managers also understand the importance of presentation. Ensuring success sometimes means that the actual product or service needs to change in some way to make it more accessible or inviting to the marketplace. Because of this, Good marketing managers will often influence the way the product or service is produced or delivered. They may even alter the core of the product to take advantage of a weakness in the marketplace. Remember, marketing is about perception, not necessarily reality. Just because it's a great product, doesn't mean anyone will want to buy it.
2. A Strong Ego
When a committee creates a vision or strategy, the results are usually full of compromise, which makes the vision unfocused, diffused, without edge, and flat. If implemented in the marketplace, the result is similar to that of using a dull knife -- it doesn't cut into the marketplace and you lose your potential share.
Instead, one person with courage, creating a vision, is almost always stronger than a group effort.
This is not to say that a marketing manager should be an island. Effective and successful marketing managers listen to people inside and outside of the company. They listen to their customers, co-workers, senior management, and salespeople. By having their ears open, marketing managers better understand the marketplace. But at the same time, they must have strong enough self-confidence to wade through the varying opinions, make up their own mind as to the direction to head, and be able to say, "This is where we're going, follow me!"
Sam Walton, the late founder of Wal-Mart, was a great example of this type of person. Those with him in the early days describe him as impervious to failure. When a particular campaign was less than effective, he was the first person on Monday morning to say, “Well that didn’t work. What’re we doing this week?” He had a vision for the company for the future and wouldn’t accept anything less.
Unfortunately, sometimes the best marketing managers are arrogant in their belief that they have the right answer. Actually, they may NOT know the right answer. But, even if a clear vision is off-target, it is almost always more effective than a diffused, less focused vision. And while these individuals may be somewhat headstrong or excessively confident about their ideas, their self-confidence and ability to put up with the critics, the "beefs," and the "yeah-buts," all the while pushing the vision forward, usually helps to sell their ideas effectively.
3. An Artistic Eye
 Most of the communication that happens between the marketplace, prospects, and the company is visual. However, the marketing manager's role is NOT to create the visual elements. Good marketing managers let those who have been trained in design and presentations do this. However, it's important that they have a good sense of visual style -- especially within their market.
Effective imagery in print, literature and on the web goes a long way in communicating the essence of a company. Marketing managers should know whether the visual style created by their agency feels right to the marketplace, describes the company well, and supports their brand. This does not mean an effective marketing manager needs to be an artist. At times, marketing managers are like local head sheriffs among the people they work with, including the design agency, internal administrative staff, and the sales staff, they must make sure that projects don't wander from the visual style. A good agency won't need much policing, but in this day and age, everyone thinks they are a designer.
It's important that marketing managers look, study, and listen in order to keep up with the visual styles in their marketplace.
4. Understands Their Market and Their Customers
Good marketing managers need to have a very strong understanding of what is happening in the marketplace and what influences people's buying decisions.
Often, marketing managers are new to the industry they are now working in. These managers work hard to study the industry, visit their customers, talk to the people in the field, and talk to their sales people. It takes work to obtain a clear understanding of the people who are making buying decisions. Understanding your market and your customer base is critical to creating the essential clear vision.
When a marketing manager misunderstands the customer or the reasons why they purchase a product or service, the marketing strategy will be off-target. If they don't know why consumers buy their product, then the marketing strategy they create will be ineffective.
To make marketing strategies more effective, marketing managers develop a process (Brand Study) for helping clients better understand their marketplace and their customers. When Brand Study is performed, managers ask their core clients what is good and bad about this company.  Questions are asked about their pricing, their customer service, and what the company can do to improve. Managers target core customers who are the bread and butter of the company and they work to get into their minds, they want to understand why customers buy from this company. When they understand why a few customers are so dedicated, they can use that information to help a company focus on finding more customers with the same needs.
A Brand Study helps a company create a marketing strategy (that vision thing, again) that targets prospects that are similar to their core customers. The only way the company can do this is by understanding its market, customers and prospects. It is amazing how often companies truly do not understand why their customers actually purchase their products or services.
5. Understands the Fundamentals of Branding, Marketing, and Advertising
Some say marketing is the art of persuasion, but in many ways it is not an art as much as a science.
The fundamentals of marketing and advertising are well known. The role of print ads within a marketing campaign, the function of public relations within a marketing campaign, reasonable goals for a direct mail campaign—all have well known answers derived from historically proven results. Good marketing managers should know these answers, make their plans and goals align with them, and weigh the risks of diverting from them with full knowledge of the possible consequences.
Should a marketing manager not understand the basics of advertising, creating consistently effective campaigns is near impossible. One of the mistakes most often made in these cases is marketing to customers with campaigns built around features or proofs of the product or service, instead of the benefits. Unfortunately for them, it’s the benefits that sell, so they never truly reach the prospect. The prospect is simply left asking, "Why should I care about this stuff?"
For example: Anti-lock brakes are not a benefit when buying a specific car, they are a feature. The specifications for the brakes may be proof to the prospect that the brakes will actually work in the manner they were designed. The proof of this may include technical literature, or supporting advertising that explains how anti-lock brakes work. The benefit in this example (which is at the heart of any good marketing program) is that the brakes will not lock up, allowing you to stop more quickly, under control, and NOT DIE. Living is the benefit!
6. A Big Picture Manager, Not a Micro-Manager
Great marketing managers paint a big picture, defining the box for their subordinates, vendors and team members.
Great marketing managers keep their eyes on the big picture, delegating detail tasks to the appropriate people. Creating, managing and selling a clear vision is extremely hard and it's easy to fall into the details because they’re easy, and less risky than the rest of the process.
Effective marketing managers are always looking at the big picture. They work at and refine the vision, and don't allow themselves to become distracted by the details.
7. An Effective Planner
Great marketing managers cannot function without a plan. However, taking the time to outline every detail of that plan, and then follow those details to the letter is counterproductive and extremely time consuming. It also distracts them from the true task of leading the company towards the marketplace with a vision. The biggest problem with creating an incredibly detailed plan is that it tends to lack the spontaneity that market forces create, and ignores the reality of creative people and ideas.
On the other hand, a marketer who doesn't have a plan is completely adrift. Marketing materials, sales literature, brochures, booths, and websites that are created without the framework of a vision, end up being fairly useless. They create a lot of noise in the marketplace, but have no focus, influence, or legacy.
A good marketing strategy or plan also requires public relations, advertising, and sales tools components. It also may include a tradeshow and Internet presence. Other components to a good marketing plan may include product packaging and point-of-purchase concerns. A good marketing manager will include these components in an overall marketing plan.
Whether a marketing plan is written (preferably) or stored in the head of the marketing manager, this planning must be done for a marketing program to be effective. Good marketers tend to be flexible, quickly changing their plan when circumstances or markets change.
8. A Master of Internal Company Politics
Internal issues and fear amongst colleagues, senior management, or the marketing manager's direct supervisor can damage or destroy a marketing program. Over the years it has been observed that conflicts between marketing managers and their superiors (or subordinates) cripple companies. Companies have failed because the marketing people couldn't navigate the internal politics of their company. Quite often, the administrative or production wings of a company have more influence than sales and marketing. In fact, in many companies, marketing is looked down upon. Engineers, developers and managers with an operations background often dominate production or manufacturing oriented companies. These companies frequently fall into the trap of thinking the better product will ultimately succeed in the marketplace. A good marketing manager understands that it is not whether the product is better or superior, but whether it is perceived as better or superior.
Because of this common clash, the production team may resent what the sales and marketing people are doing because they don’t understand the value. The marketing manager's role is to constantly teach the production team about The Vision. They need to demonstrate proof and show results. It's important that the marketing manager brag internally (selflessly) when their programs are working. They also need to teach both the sales team and the production side of the company about the successes occurring in the marketplace.
It's all about creating a climate for success. Successful marketing managers find ways to generate internal enthusiasm for their marketing programs. Great marketers find ways to include the sales team in their vision. Sometimes the marketing manager even needs to target their superior (CEO, President, Owner, etc.) and educate (sell) them on important issues so they can get the financial backing they need to carry out a successful program.
For example: the marketing budget is quite often one of the very first items that senior management targets for cuts when money is a little tight, even though industry research has consistently shown that companies who stop marketing and advertising during a recession or economic slowdown suffer severe economic and brand damage,  if they survive at all. Meanwhile, companies who manage to find the budget and continue marketing through the downtime will often capture market share and are much better off in the long run. Marketing managers have to preempt this kind of self-destructive action by consistently exemplifying their successes to everyone in the company and teaching them of the marketing team’s value.
1). Being successful means being able to adapt the marketing mix to trends and changes this environment.
2). Changes in the marketing environment are often quick and unpredictable.
3). The marketing environment offers both opportunities and threats.
4). The company must use its marketing research and marketing intelligence systems to monitor the changing environment.
1. Micro environmental

• The company itself (including departments). 

• Suppliers.

• Marketing channel firms (intermediaries). 

• Customer markets.

•  Competitors.

•  Publics.

2). Marketing managers must make decisions within the parameters established by top management.
3). Marketing managers must also work closely with other company departments. Areas such as finance, R & D, purchasing, manufacturing, and accounting all produce better results when aligned by common objectives and goals.
4). All departments must “think consumer” if the firm is to be successful. The goal is to provide superior customer value and satisfaction.
2). Another point of concern is the monitoring of price trends of key inputs. Rising supply costs must be carefully monitored.
1). Resellers are distribution channel firms that help the company find customers or make sales to them.
2). These include wholesalers and retailers who buy and resell merchandise.
3). Resellers often perform important functions more cheaply than the company can perform itself. However, seeking and working with resellers is not easy because of the power that some demand and use.
1). Consumer markets (individuals and households that buy goods and services for personal consumption).
2). Business markets (buy goods and services for further processing or for use in their production process).
3). Reseller markets (buy goods and services in order to resell them at a profit).
4). Government markets (agencies that buy goods and services in order to produce public services or transfer them to those that need them).
5). International markets (buyers of all types in foreign countries).
1). Financial publics--influence the company’s ability to obtain funds.
2). Media publics--carry news, features, and editorial opinion.
3). Government publics--take developments into account.
4). Citizen-action publics--a company’s decisions are often questioned by consumer organizations.
5). Local publics--includes neighborhood residents and community organizations.
6). General public -a company must be concerned about the general public’s attitude toward its products and services.
7). Internal publics--workers, managers, volunteers, and the board of directors.
2. MACRO ENVIRONMENT
The Company’s Macro environment
a. Demographic.
b. Economic.
c. Natural.
d. Technological.
e. Political.
f. Cultural.
a. Demographic Environment
1). The world’s population (though not all countries) rate is growing at an explosive rate that will soon exceed food supply and ability to adequately service the population. The greatest danger is in the poorest countries where poverty contributes to the difficulties. Emerging markets such as China are receiving increased attention from global marketers.
2). The most important trend is the changing age structure of the population. The population is aging because of a slowdown in the birth rate (in this country) and life expectancy is increasing. The baby boomers following World War II have produced a huge “bulge” in our population’s age distribution. The new prime market is the middle age group (in the future it will be the senior citizen group). There are many subdivisions of this group.
a). Generation X--this group lies in the shadow of the boomers and lack obvious distinguishing characteristics. They are a very cynical group because of all the difficulties that have surrounded and impacted their group.
b). Echo boomers (baby boom lets) are the large growing kid and teen market. This group is used to affluence on the part of their parents (as different from the Gen Xers). One distinguishing characteristic is their utter fluency and comfort with computer, digital, and Internet technology (sometimes called Net-Gens).
c). Generational marketing is possible; however, caution must be used to avoid generational alienation. Many in the modern family now “telecommute”, work at home or in a remote office and conduct their business using fax, cell phones, modem, or the Internet In general, the population is becoming better educated. The work force is be-coming more white-collar. Products such as books and education services appeal to groups following this trend. Technical skills (such as in computers) will be a must in the future. The final demographic trend is the increasing ethnic and racial diversity of the population. Diversity is a force that must be recognized in the next decade. However, companies must recognize that diversity goes beyond ethnic heritage. One the important markets of the future are that disabled people (a market larger any of our ethnic minority groups).
b. Economic Environment
1). Personal consumption (along with personal debt) has gone up (1980s) and the early 1990s brought recession that has caused adjustments both personally and corporately in this country. Today, consumers are more careful shoppers.
2). Value marketing (trying to offer the consumer greater value for their dollar) is a very serious strategy in the 1990s. Real income is on the rise again but is being carefully guarded by a value-conscious consumer.
3). Income distribution is still very skewed in the U. S. and all classes have not shared in prosperity. In addition, spending patterns show that food, housing, and transportation still account for the majority of consumer dollars. It is also of note that distribution of income has created a “two-tiered market” where there are those that are affluent and less affluent. Marketers must carefully monitor economic changes so they will be able to prosper with the trend, not suffer from it.
c. Natural Environment
1). Shortages of raw materials.
2). Increased pollution
3). Government intervention
4). Environmentally sustainable strategies.
5. Technological Environment
1). Technology is perhaps the most dramatic force shaping our destiny.
2). New technologies create new markets and opportunities.
3). The following trends are worth watching:  
a). Faster pace of technological change. Products are being technologically outdated at a rapid pace.
b). There seems to be almost unlimited opportunities being developed daily. Consider the expanding fields of health care, the space shuttle, robotics, and biogenetic industries.
c). The challenge is not only technical but also commercial--to make practical, affordable versions of products.
d). Increased regulation. Marketers should be aware of the regulations concerning product safety, individual privacy, and other areas that affect technological changes. They must also be alert to any possible negative aspects of an innovation that might harm users or arouse opposition.
6. Political Environment
1). Governments develop public policy to guide commerce--sets of laws and regulations limiting business for the good of society as a whole.
2). Almost every marketing activity is subject to a wide range of laws and regulations. Some trends in the political environment include:
1). Increasing legislation to:
a). Protect companies from each other.
b). Protecting consumers from unfair business practices.
c). Protecting interests of society against unrestrained business behavior.
a). Enlightened companies encourage their managers to look beyond regulation and “do the right thing.”
b). Recent scandals have increased concern about ethics and social responsibility.
c). The boom in e-commerce and Internet marketing has created a new set of social and ethical issues. Concerns are Privacy, Security, Access by vulnerable or unauthorized groups.
7. Cultural Environment
a). People’s views of themselves. People vary in their emphasis on serving themselves versus serving others. In the 1980s, personal ambition and materialism increased dramatically, with significant implications for marketing. The leisure industry was a chief beneficiary.
b). People’s views of others. Observers have noted a shift from a “me-society” to a “we-society.” Consumers are spending more on products and services that will improve their lives rather than their image.
c). People’s views of organizations. People are willing to work for large organizations but expect them to become increasingly socially responsible. Many companies are linking themselves to worthwhile causes. Honesty in appeals is a must.
d). People’s views of society. This orientation influences consumption patterns. “Buy American” versus buying abroad is an issue that will continue into the next decade.
e). People’s view of nature. There is a growing trend toward people’s feeling of mastery over nature through technology and the belief that nature is bountiful. However, nature is finite. Love of nature and sports associated with nature are expected to be significant trends in the next several years.
f). People’s views of the universe. Studies of the origin of man, religion, and thought-provoking ad campaigns are on the rise. Currently, Americans are on a spiritual journey. This will probably take the form of “spiritual individualism.”
Marketing Information System
2 Organizing
3 Coordinating
4 Deciding
5 Controlling
· Product type, size and pack type by type of account
· Product type, size and pack type by industry
· Product type, size and pack type by customer
· Average value and/or volume of sale by territory
· Average value and/or volume of sale by type of account
· Average value and/or volume of sale by industry
· Average value and/or volume of sale by sales person
Marketing research systems: The general topic of marketing research has been the prime ' subject of the textbook and only a little more needs to be added here. Marketing research is a proactive search for information. That is, the enterprise which commissions these studies does so to solve a perceived marketing problem. In many cases, data is collected in a purposeful way to address a well-defined problem (or a problem which can be defined and solved within the course of the study). The other form of marketing research centers not around a specific marketing problem but is an attempt to continuously monitor the marketing environment. These monitoring or tracking exercises are continuous marketing research studies, often involving panels of farmers, consumers or distributors from which the same data is collected at regular intervals. Whilst the ad hoc study and continuous marketing research differs in the orientation, yet they are both proactive.
· Brand switching models
· Linear programming
· Elasticity models (price, incomes, demand, supply, etc.)
· Regression and correlation models
· Analysis of Variance (ANOVA) models
· Sensitivity analysis
· Discounted cash flow
· Spreadsheet 'what if models
• The traditional definition of Marketing Research by American Marketing Association (AMA) -the systematic gathering, recording and analyzing of data about problems relating to the marketing of goods and services.-
• Also defined as the function which links the consumer, customer and public to the marketer through information used to identify and define marketing opportunities and problems. It involves the use of surveys, tests, and statistical studies to analyze consumer trends and to forecast the size and location of markets for specific products or services.

• Marketing Research (MR) is not an exact science though it uses the techniques of science. Thus, the results and conclusions drawn upon by using MR are not very accurate.

• The results of MR are very vague as MR is carried out on consumers, suppliers, intermediaries, etc. who are humans. Humans have a tendency to behave artificially when they know that they are being observed. Thus, the consumers and respondents upon whom the research is carried behave artificially when they are aware that their attitudes, beliefs, views, etc are being observed.

• MR is not a complete solution to any marketing issue as there are many dominant variables between research conclusions and market response.

• MR is not free from bias. The research conclusions cannot be verified. The reproduction of the same project on the same class of respondents give different research results.

• Inappropriate training to researchers can lead to misapprehension of questions to be asked for data collection.

• Many business executives and researchers have ambiguity about the research problem and its objectives. They have limited experience of the notion of the decision-making process. This leads to carelessness in research and researchers are not able to do anything real.

• There is less interaction between the MR department and the main research executives. The research department is in segregation. This all makes research ineffective.

• MR faces time constraint. The firms are required to maintain a balance between the requirement for having a broader perspective of customer needs and the need for quick decision making so as to have competitive advantage.

• Huge cost is involved in MR as collection and processing of data can be costly. Many firms do not have the proficiency to carry wide surveys for collecting primary data, and might not also able to hire specialized market experts and research agencies to collect primary data. Thus, in that case, they go for obtaining secondary data that is cheaper to obtain.

• MR is conducted in open marketplace where numerous variables act on research settings.

• Poor expectations that lead to a general lack of desire to buy, or

• Poor performance experience and a lack of desire to repurchase.

• Formulate a problem

• Develop a hypothesis

• Make predictions based on the hypothesis

• Devise a test of the hypothesis

• Conduct the test

• Analyze the results

§  Descriptive Research Design

• Exploratory Research Design

• Causal Research Design

Interviews require you to ask questions and receive responses.

• From which base population is the sample to be selected?

• What is the method (process) for sample selection?

• What is the size of the sample?

· It provides a basis for sound, market led decision making by providing information to reduce uncertainty.
· Marketing research enables an organist ion to match their products or services to the requirements of the consumers or market.
· Research enables advertising to be tested during a campaigns development or prior to launch to ensure its effectiveness, and after launch to measure the success of the media used.
· It also enables product ideas to be tested without expenses of lunching to the market; this can be a change in service, product or design.
· It also provides objective explanation for success and failure in the market.
· Marketing research also helps to evaluate the strength and weakness of rivals plus the threats they may cause to the company.
Learn about your potential clients — who they are and what they want the most. Nothing improves communication skills better than a little person to person contact.
Check the competition. Are they missing something you can capitalize on? What can you do better than they can? Are you clients in need of something nobody else is offering?
Just like any situation, if you come prepared you will be less likely to loose and more likely to win.
How well are you doing? By setting the standard high from the start, you will be in a better position for sustained growth.
Though marketing research is a good practice for all firms to embark on and indeed many put in a lot of effort, many times things go wrong in the process. Below are some of the reasons why marketing research can fail.
financial constraints may limit the amount of research activity, leading to erroneous conclusion. Sometimes research activities are put on hold before they are completed due to lack of funds.
Many companies and firms attempt to do too much in such a little time, they end up taking shortcuts and sometimes use out of date secondary data which produces wrong results.
Research methods can be distorted by errors in project design, sampling techniques, lack of understanding by subject and interview bias.
Some mangers that are not experienced in analyzing and interpreting research data may only look for the information they want to see from the research data and hence neglect a whole lot of important data.
Some times, some people due to different reasons can give wrong information to the interviewer which will produce wrong results.
There are some products which are only consumed by seasons, making a research about such products in a different season will produce wrong results.

• Determine the profitability of the market

• Determine what customers want and need in the market

• Determine if there are already products available that are popular in the market

• Determine how the top rated websites in the market are selling the hot products that you find.

• Back engineer the selling strategies of the most profitable websites in the market

• Determine which websites dominate your market and why

• Determine how the most popular websites in the market make money

• Determine profit potential in the market

• In-person surveys are one-on-one interviews typically conducted in high-traffic locations such as shopping malls. They allow you to present people with samples of products, packaging, or advertising and gather immediate feedback. In-person surveys can generate response rates of more than 90 percent, but they are costly. With the time and labor involved, the tab for an in-person survey can run as high as $100 per interview.

• Telephone surveys are less expensive than in-person surveys, but costlier than mail. However, due to consumer resistance to relentless telemarketing, convincing people to participate in phone surveys has grown increasingly difficult. Telephone surveys generally yield response rates of 50 to 60 percent.

• Mail surveys are a relatively inexpensive way to reach a broad audience. They're much cheaper than in-person and phone surveys, but they only generate response rates of 3 percent to 15 percent. Despite the low return, mail surveys remain a cost-effective choice for small businesses.

• Online surveys usually generate unpredictable response rates and unreliable data, because you have no control over the pool of respondents. But an online survey is a simple, inexpensive way to collect anecdotal evidence and gather customer opinions and preferences.

• Strategy is concerned with the scope of an organization’s activities:

• About matching activities to the environment.

• About matching activities to the resource capability.

• Will usually have major resource implications.

• Will usually affect and inform operational decisions.

• Will be affected by values and expectations of those holding organizational power.

Porter’s Five Force Model:
1           Introduction
2           The Five Competitive Forces
1          Bargaining Power of Suppliers
2.2          Bargaining Power of Customers
2.3          Threat of New Entrants
2.4          Threat of Substitutes
2.5          Competitive Rivalry Among Existing Players
3   Use of the Information form Five Forces Analysis
4           Influencing the Power of Five Forces
The Value Chain
A methodology of separating a business system into a series of value-generating activities that develop competitive advantage.

• Economies of scale

• Learning

• Capacity utilization

• Linkages among activities

• Interrelationships among business units

• Degree of vertical integration

• Timing of market entry

• Firm's policy of cost or differentiation

• Geographic location

• Institutional factors (regulation, union activity, taxes, etc.)

Differentiation and the Value Chain

• Policies and decisions

• Linkages among activities

• Timing

• Location

• Interrelationships

• Learning

• Integration

• Scale (e.g. better service as a result of large scale)

• Institutional factors

Technology and the Value Chain

• Inbound Logistics Technologies

• Transportation

• Material handling

• Material storage

• Communications

• Testing

• Information systems

• Operations Technologies

• Process

• Materials

• Machine tools

• Material handling

• Packaging

• Maintenance

• Testing

• Building design & operation

• Information systems

• Outbound Logistics Technologies

• Transportation

• Material handling

• Packaging

• Communications

• Information systems

• Marketing & Sales Technologies

• Media

• Audio/video

• Communications

• Information systems

• Service Technologies

• Testing

• Communications

• Information systems

Linkages between Value Chain Activities
Outsourcing Value Chain Activities
Using value change analysis to identify activities to outsource.

Consumers and Customers:

The difference between a consumer and a customer is a very thin line. Aside from both terms being used frequently in the field of business, these words are often used in a similar context, which adds up to the confusion.

These definitions were actually drafted with the aim of consumer protection, especially when businesses turn a little bit sour.

1.      A consumer is someone who actually consumes the goods and not just purchases it.

2.      A costumer is someone who buys the goods for more commercial purposes.

According to the 1986 Consumer Protections Act of India, a consumer can also be somebody who uses goods and services for a living. In addition, the mere intent of buying goods makes you a consumer, nonetheless

Marketing & Selling

In general we use ‘marketing’ and ‘selling’ as synonyms but there is a substantial difference between both the concepts. It is necessary to understand the differences between them for a successful marketing manager. Selling has a product focus and mostly producer driven. It is the action part of marketing only and has short term goal of achieving market share. The emphasis is on price variation for closing the sale where the objective can be stated, as “I must somehow sell the product”. This short term focus does not consider a prudential planning for building up the brand in the market place and winning competitive advantage through a high loyal set of customers. The end means of any sales activity is maximizing profits through sales maximization.

When the focus is on selling, the businessman thinks that after production has been completed the task of the sales force starts. It is also the task of the sales department to sell whatever the production department has manufactured. Aggressive sales methods are justified to meet this goal and customer’s actual needs and satisfaction are taken for granted. Selling converts the product in to cash for the company in the short run.
Marketing as a concept and approach is much wider than selling and is also dynamic as the focus is on the customer rather than the product. While selling revolves around the needs and interest of the manufacturer or marketer, marketing revolves around that of consumer. It is the whole process of meeting and satisfying the needs of the consumer.

Marketing consists of all those activities that are associated with product planning, pricing, promoting and distributing the product or service. The task commences with identifying consumer needs and does not end till feedback on consumer satisfaction from the consumption of the product is received. It is a long chain of activity, which comprises production, packing, promotion, pricing, distribution and then the selling. Consumer needs become the guiding force behind all these activities. Profits are not ignored but they are built up on a long run basis. Mind share is more important than market share in Marketing.

According to Prof. Theodore Levitt ‘The difference between selling and marketing is more than semantic. A truly marketing minded firm tries to create value satisfying goods and services which the consumers will want to buy. What is offers for sale is determined not by the seller but by the buyers. The seller takes his cues from the buyer and the product becomes the consequence of the marketing effort, not vice versa. Selling merely concerns itself with the tricks and techniques of getting the customers to exchange their cash for the company’s products, it does not bother about the value satisfaction that the exchange is all about. On the contrary, marketing views the entire business as consisting of a tightly integrated effort to discover, create, arouse ad satisfy customer needs’.

SELLING

1 Emphasis is on the product
2 Company Manufactures the product first
3 Management is sales volume oriented
4 Planning is short-run-oriented in terms of today’s products and markets
5 Stresses needs of seller
6 Views business as a good producing process
7 Emphasis on staying with existing technology and reducing costs
8 Different departments work as in a highly separate water tight compartments
9 Cost determines Price
10 Selling views customer as a last link in business

MARKETING

1 Emphasis on consumer needs wants
2 Company first determines customers needs and wants and then decides out how to deliver a product to   satisfy these wants
3 Management is profit oriented
4 Planning is long-run-oriented in today’s products and terms of new products, tomorrow’s markets and   future growth
5 Stresses needs and wants of buyers
6 Views business as consumer producing process satisfying process
7 Emphasis on innovation on every existing technology and reducing every sphere, on providing better   costs value to the customer by adopting a superior technology
8 All departments of the business integrated manner, the sole purpose being generation of consumer satisfaction
9. Consumer determine price, price determines cost
10. Marketing views the customer last link in business as the very purpose of the business

Types of Market

Markets can be analyzed via the product itself, or end-consumer, or both. The most common distinction is between consumer and industrial markets.

Consumer Markets

Consumer markets are the markets for products and services bought by individuals for their own or family use. Goods bought in consumer markets can be categorized in several ways:

• Fast-moving consumer goods (“FMCG's”)

– These are high volume, low unit value, fast repurchase
– Examples include: Ready meals; Baked Beans; Newspapers

• Consumer durables

Highly durable goods such as refrigerators, cars, or mobile phones usually continue to be useful for three or more years of use, and hence durable goods are typically characterized by long periods between successive purchases. These durable goods are referred to as Consumer Durables and examples of consumer durable goods include cars, household goods (home appliances, consumer electronics, furniture, etc.), sports equipment, and toys. As the second purchase for durable goods lags time difference, generally they are sold on a higher margin.

The Consumer Durables industry consists of durable goods and appliances for domestic use such as televisions, refrigerators, air conditioners and washing machines. Instruments such as cell phones and kitchen appliances like microwave ovens are also included in this category. The sector has been witnessing significant growth in recent years, helped by several drivers such as the emerging retail boom, real estate and housing demand, greater disposable income and an overall increase in the level of affluence of a significant section of the population. The industry is represented by major international and local players such as Sony, Lg, Videocon, Voltas, Blue Star, MIRC Electronics, Titan, Whirlpool, etc.

The consumer durables industry can be broadly classified into two segments: Consumer Electronics and Consumer Appliances. Consumer Appliances can be further categorized into Brown Goods and White Goods. The key product lines under each segment are as follows.

White Goods

·         Kitchen Appliances

·         Refrigerators

·         Washing Machines

·         Air-conditioners

·         Speakers and Audio Equipment

Kitchen Appliances / Brown Goods Consumer Electronics

·         Mixers

·         Grinders

·         Microwave Ovens

·         Iron

·         Electric Fans

·         Cooking Range

·         Chimneys

Consumer Electronics

·         Mobile Phones

·         Televisions

·         MP3 Players

·         DVD Players

·         VCD Players

·         iPad

 • Soft goods 
– Soft goods are similar to consumer durables, except that they wear out more quickly and therefore have a shorter replacement cycle
– Examples include clothes, shoes

• Services (e.g. hairdressing, dentists, childcare)

Industrial Markets

Industrial markets involve the sale of goods between businesses. These are goods that are not aimed directly at consumers. Industrial markets include

• Selling finished goods
– Examples include office furniture, computer systems

• Selling raw materials or components
– Examples include steel, coal, gas, timber

• Selling services to businesses
– Examples include waste disposal, security, accounting & legal services

Industrial markets often require a slightly different marketing strategy and mix. In particular, a business may have to focus on a relatively small number of potential buyers (e.g. the IT Director responsible for ordering computer equipment in a multinational group). Whereas consumer marketing tends to be aimed at the mass market (in some cases, many millions of potential customers), industrial marketing tends to be focused.

Classification of Manufactured Consumer Goods

Consumer goods are tangible final goods, goods which can be finally consumed by the consumer, which are produced or manufactured for consumption by individuals in the mass market.

They come with a huge variety of products ranging from baby bottles to power equipments, nanotechnology devices, foods, clothing products, stationary, gift articles, toys, household appliances, kitchen ware, groceries, electronic goods etc.

There are two types of consumer goods: durable or non-durable. Durable goods are those goods which can be used or consumed for a long time. This means they are manufactured in a way to have a long working life span. Products like automobiles, utensils, and stationary come under this category. Whereas, non durable goods are those goods which do not have long life span or which cannot be use for a long period. Products including food and clothing come under this category.

Further, consumer goods can be categorized in four categories:

·         Convenience Goods: Goods which are conveniently available for purchase in a wide variety and are distributed widely are called convenience goods. They include products like fast foods, confectionaries, petrol or cigarettes.

·         Shopping goods: It is a type of consumer goods where while purchasing, consumer do lot of selection based on various parameter such as cost, brand, style, comfort etc. Clothing items are best example of shopping goods as they require lot of selection by the consumer.

·         Exclusive goods: Exclusive Goods are available for a very particular and high-profile category of consumer. Almost every luxury item comes under this category because the items are exclusively offered to high-income group of society.

·         Non Sought goods: Goods which are might be available or known to a consumer but he is really not interested in buying them are called non-sought goods.

Big companies involved in making consumer goods in India are Hindustan Lever, Godrej, Tata Group, Jyothy Laboratories, Reliance etc.

Worldwide, multinational companies are making developments and advancements in manufacturing consumer goods to increase their market. But the innovativeness or changing frequencies of a product has reduced its life span. This means, whenever a new product is launched in the market, sooner, a new version of that product with additional features comes in the market. This effectively reduces the demand of that previous version. For example, Nokia is planning to launch its E series of product very sooner after the launch of N-series.

Although, the practice of maintaining innovation in the products has excelled competition in the market and has also increased the parameters of research and development in the field.

Marketing Mix

A mixture of several ideas and plans followed by a marketing representative to promote a particular product or brand is called marketing mix. Several concepts and ideas combined together to formulate final strategies helpful in making a brand popular amongst the masses form marketing mix.

When marketing their products firms need to create a successful mix of:

·         The right product

·         Sold at the right price

·         In the right place

·         Using the most suitable promotion.

1        The product has to have the right features - for example, it must look good and work well.

2        The price must be right. Consumer will need to buy in large numbers to produce a healthy profit.

3        The goods must be in the right place at the right time. Making sure that the goods arrive when and where they are wanted is an important operation.

4        The target group needs to be made aware of the existence and availability of the product through promotion. Successful promotion helps a firm to spread costs over a larger output.

·         The appearance of the product - in line with the requirements of the market

·         The function of the product - products must address the needs of customers as identified through market research.

The elements of marketing mix are often called the four P’s of marketing.

Goods manufactured by organizations for the end-users are called products.

Products can be of two types - Tangible Product and Intangible Product (Services)

An individual can see, touch and feel tangible products as compared to intangible products.

A product in a market place is something which a seller sells to the buyers in exchange of money.

The money which a buyer pays for a product is called as price of the product. The price of a product is indirectly proportional to its availability in the market. Lesser its availability, more would be its price and vice a versa.

Retail stores which stock unique products (not available at any other store) quote a higher price from the buyers.

Place refers to the location where the products are available and can be sold or purchased. Buyers can purchase products either from physical markets or from virtual markets. In a physical market, buyers and sellers can physically meet and interact with each other whereas in a virtual market buyers and sellers meet through internet.

Promotion refers to the various strategies and ideas implemented by the marketers to make the end - users aware of their brand. Promotion includes various techniques employed to promote and make a brand popular amongst the masses.

Promotion can be through any of the following ways:

§ Advertising: Print media, Television, radio are effective ways to entice customers and make them aware of the brand’s existence.

Billboards, hoardings, banners installed intelligently at strategic locations like heavy traffic areas, crossings, railway stations, bus stands attract the passing individuals towards a particular brand.

Taglines also increase the recall value of the brand amongst the customers.

§ Word of mouth

One satisfied customer brings ten more customers along with him whereas one dissatisfied customer takes away ten more customers. That’s the importance of word of mouth. Positive word of mouth goes a long way in promoting brands amongst the customers.

What are the main elements of the marketing mix of Manchester United? First of all the product includes providing an excellent football team that plays and wins in an exciting way. However, there are other ingredients of the product including merchandising such as the sale of shirts, and a range of memorabilia. The product also relates to television rights, and Manchester United's own television channel. In one respect the place is Old Trafford where home games are played, but Manchester United also plays at a range of other venues. And, of course its products are sold across the globe, through the club's website and a range of other sales media. 
Manchester United markets itself as a global brand. The club also engages in a range of joint promotional activities, for example with the mobile phone company Vodafone. Manchester United books, shirts, programmes, keyrings and many other items are sold and promoted through its website. The club has positioned itself at the up market premier end of the market and, as a result, it tends to charge premium prices as evidenced by the high cost of a season ticket to watch home league games.
Positioning or repositioning a product - refers to locating that product within a market for example presenting it is an up market or down market product. Positioning it as a product for younger consumers or older consumers etc.

Lately three more P’s have been added to the marketing mix. They are as follows:

5. People - The individuals involved in the sale and purchase of products or services come under people. People are an essential ingredient in service provision; recruiting and training the right staff is required to create a competitive advantage. Customers make judgments about service provision and delivery based on the people representing your organization. This is because people are one of the few elements of the service that customers can see and interact with. The praise received by the volunteers (games makers) for the London 2012 Olympics and Paralympics demonstrates the powerful effect people can create during service delivery.

Staff requires appropriate interpersonal skills, attitude, and service knowledge in order to deliver a quality service. In the UK many organizations apply for the "Investors in People" Accreditation to demonstrate that they train their staff to prescribed standards and best practices.

6. Process - Process includes the various mechanisms and procedures which help the product to finally reach its target market. This element of the marketing mix looks at the systems used to deliver the service. Imagine you walk into Burger King and order a Whopper Meal and you get it delivered within 2 minutes. What was the process that allowed you to obtain an efficient service delivery? Banks that send out Credit Cards automatically when their customer’s old one has expired again require an efficient process to identify expiry dates and renewal. An efficient service that replaces old credit cards will foster consumer loyalty and confidence in the company. All services need to be underpinned by clearly defined and efficient processes. This will avoid confusion and promote a consistent service. In other words processes mean that everybody knows what to do and how to do it.

7. Physical Evidence - With the help of physical evidence, a marketer tries to communicate the USP’s and benefits of a product to the end users. Physical evidence is about where the service is being delivered from. It is particularly relevant to retailers operating out of shops. This element of the marketing mix will distinguish a company from its competitors. Physical evidence can be used to charge a premium price for a service and establish a positive experience. For example all hotels provide a bed to sleep on but one of the things affecting the price charged, is the condition of the room (physical evidence) holding the bed. Customers will make judgments about the organization based on the physical evidence. For example if you walk into a restaurant you expect a clean and friendly environment, if the restaurant is smelly or dirty, customers are likely to walk out. This is before they have even received the service.

Now days, organizations treat their customers like kings. In the current scenario, the four C’s has thus replaced the four P’s of marketing making it a more customer oriented model. Koichi Shimizu in the year 1973 proposed a four C’s classification.

§ Commodity - (Replaces Products)

§ Cost - (Replaces Price) involves manufacturing cost, buying cost and selling cost

§ Channel - The various channels which help the product reach the target market.

§ Communication - (Replaces Promotion)

Robert F. Lauterborn gave a modernized version of the four C’s model in the year 1993. According to him the four C’s of marketing are:

Consumer

Functions of Marketing Management

1 Market Research:

Managers need information in order to introduce products and services that create value in the mind of the customer. But the perception of value is a subjective one, and what customers value this year may be quite different from what they value next year. As such, the attributes that create value cannot simply be deduced from common knowledge. Rather, data must be collected and analyzed. The goal of marketing research is to provide the facts and direction that managers need to make their more important marketing decisions.

To maximize the benefit of marketing research, those who use it need to understand the research process and its limitations.

These terms often are used interchangeably, but technically there is a difference.

Market research deals specifically with the gathering of information about a market's size and trends. Marketing research covers a wider range of activities. While it may involve market research, marketing research is a more general systematic process that can be applied to a variety of marketing problems.

Information can be useful, but what determines its real value to the organization? In general, the value of information is determined by:

Once the need for marketing research has been established, most marketing research projects involve these steps:

The decision problem faced by management must be translated into a market research problem in the form of questions that define the information that is required to make the decision and how this information can be obtained. Thus, the decision problem is translated into a research problem. For example, a decision problem may be whether to launch a new product. The corresponding research problem might be to assess whether the market would accept the new product.

2 Marketing planning:

 Marketing plans are prepared to achieve marketing objectives

Product planning in a broad sense is how a company generates the ideas for its products based on a number of factors. These include input from multiple business departments, such as marketing, technical support, sales teams and engineering. A business also includes analysis of competitor products and consumer needs into its product planning. This helps a business understand what products the competition is offering, how those products are meeting consumer needs and how the business can innovate new products to better meet those needs.

Product development requires development resources to successfully create a functioning prototype of a product and continue to make revisions as market requirements come into focus. To accomplish this, a business must prioritize its development projects by those that show the most promise and those which may require more design time. Allocating resources effectively is paramount to a business shortening its development time and moving finished products to market at a more rapid pace. This allows a business to meet customer demands at peak need before another company can swoop in and take advantage.

Types of Buying:

Concentrated Buying: under this process purchases are made from a limited number of sources or from a single source of supply. It enables the buyer to secure certain benefits being a regular customer. The buyer gets better service, prompt delivery, reasonable price, higher discounts from the seller. The suppliers may also take undue advantages of trust of the buyers.

Diversified or Scattered Buying: In this practice buyers make purchase from large number of suppliers. It is a flexible system of buying. It affords competitive prices, better service, and wider choice in planning of assortments. But under this practice buyers have to maintain  business relationship with many suppliers which involves higher costs and moreover the benefits of quantity ,discount and reduced cost of transportation  for bulk purchase from a few  suppliers is also not available to buyers.

Reciprocal Buying: An arrangement in which two or more organizations purchase one another's goods and services. For example, a multi business firm enters into a buying and selling arrangement with businesses that are its customers and suppliers

Conservative Buying: some buyers have the habit of buying strictly on the basis of current needs. They have to make frequent buying, receipt of goods and payments. Such a policy is most suitable when the prices are falling. In such situation there is need to keep the stocks to minimum and hence the conservative or hand to mouth practice is followed.

Speculative Buying: Under this practice of buying purchases are made in bulk by placing large orders with a view to sell the same at the higher price in the near future. This policy is suited when prices are rising or when the suppliers are short in supply

5. Standardization and Grading:

Grading is the process of sorting individual units of a product into well defined classes or grades of quality. The goods are graded or sorted out into different lots in accordance with the specified standards. The established standards lay down the grades of the product. In case of manufactured goods, goods can be of uniform quality. But agricultural products like fruits and vegetables, etc., vary in quality. Therefore, classes or grades of quality are set and different units of the product are sorted into the established standard grades. Thus, grading involves the division of products into classes made up of units possessing similar characteristics of size and quality.

Standardization and Grading are interdependent activities. Standardization lay down the standards or grade of quality. Grading involves classifying the products into specific lots as per the established standards.

Advantages of Standardization and Grading

Standardization and Grading are useful marketing functions as they offer the following advantages:

1. Standardization and Grading facilitate buying and selling of goods by sample or description. When goods are of standardized quality, customers do not insist on detailed inspection.

2. Standardized goods sell better and fetch a better price to the seller because customers have more faith in them.

3. Standardization and Grading enable the producer to direct the goods of different qualities towards the market best suited to them. The task of middlemen becomes easy because they can communicate well the characteristics of standardized products to customers.

4. Transportation, storage and advertising expenses can be reduced by handling different grades or lots.

5. Standardized goods enjoy a wider market.

6. Standardization and Grading facilitate trading of goods on the commodity exchange. Hedging, future trading and price comparisons become easy.

7. Standardization and Grading helps in raising finance because standardized products enjoy a ready market and they are readily accepted as a collateral security for granting loans.

8. Standardized products can be easily valued and their prices fluctuate less widely. This helps in making insurance claims in the event of loss or damages to the goods.

6. Branding: 

A brand is a name, sign, symbol, design assigned to a product so as to

Therefore it makes sense to understand that branding is not about getting your target market to choose you over the competition, but it is about getting your prospects to see you as the only one that provides a solution to their problem.

The objectives that a good brand will achieve include:

·         Delivers the message clearly

·         Confirms your credibility

·         Connects your target prospects emotionally

·         Motivates the buyer

·         Concretes User Loyalty

To succeed in branding you must understand the needs and wants of your customers and prospects. You do this by integrating your brand strategies through your company at every point of public contact.

Your brand resides within the hearts and minds of customers, clients, and prospects. It is the sum total of their experiences and perceptions, some of which you can influence, and some that you cannot.

A strong brand is invaluable as the battle for customers intensifies day by day. It's important to spend time investing in researching, defining, and building your brand. After all your brand is the source of a promise to your consumer. It's a foundational piece in your marketing communication and one you do not want to be without.

7. Labelling: 

A Label is a carrier of information about the product. Labels are attached on

8. Customer Support Services:

9. Promotion: Promotion refers to communication to inform, persuade and influence the

Think of it like a cake mix, the basic ingredients are always the same. However if you vary the amounts of one of the ingredients, the final outcome is different. It is the same with promotions. You can integrate different aspects of the promotions mix to deliver a unique campaign. Now let's look at the different elements of the promotions mix

The elements of the promotions mix are:

·         Personal Selling.

·         Sales Promotion.

·         Public Relations.

·         Direct Mail.

·         Trade Fairs and Exhibitions.

·         Advertising.

·         Sponsorship.

7. Labelling: A Label is a carrier of information about the product. Labels are attached on the product package to provide information about the product such as manufacturer of the product, date of manufacture, date of expiry, its ingredients, how to use product and its handling. Functions: · It describes the product, its usage, contents,  date of manufacture and expiry etc. · It helps in grading of the products. · It helps in product identification. · It supports product promotion. 8. Customer Support Services:  In today’s competitive environment, customer support services play an important role in marketing. Services such as after sale services, maintenance services, handling customer complaints provides satisfaction to customers and also helps in building product loyalty. 9. Promotion: Promotion refers to communication to inform, persuade and influence the prospective customers to buy a product. Promotion is the element of the marketing mix which is entirely responsible for communicating the marketing proposition. Marketers work hard to create a unique marketing proposition for their product or service. McDonald's is about community, food and enjoyment. Audi is about the driver experience and technology Think of it like a cake mix, the basic ingredients are always the same. However if you vary the amounts of one of the ingredients, the final outcome is different. It is the same with promotions. You can integrate different aspects of the promotions mix to deliver a unique campaign. Now let's look at the different elements of the promotions mix. The elements of the promotions mix are: ·           ·           ·           ·           ·           ·           ·           ·           ·         Personal Selling. ·         Sales Promotion. ·         Public Relations. ·         Direct Mail. ·         Trade Fairs and Exhibitions. ·         Advertising. ·         Sponsorship. And also online promotions. The elements of the promotions mix are integrated to form a coherent campaign. As with all forms of communication, the message from the marketer follows the 'communications process' as illustrated above. For example, a radio advert is made for a car manufacturer. The car manufacturer (sender) pays for a specific advert with contains a message specific to a target audience (encoding). It is transmitted during a set of commercials from a radio station (message/medium). The message is decoded by a car radio (decoding) and the target consumer interprets the message (receiver). He or she might visit a dealership or seek further information from a web site (Response). The consumer might buy a car or express an interest or dislike (feedback). This information will inform future elements of an integrated promotional campaign. Perhaps a direct mail campaign would push the consumer to the point of purchase. Noise represents the thousands of marketing communications that a consumer is exposed to everyday, all competing for attention.   The Promotions Mix. Let us look at the individual components of the promotions mix in more detail. Remember all of the elements are 'integrated' to form a specific communications campaign. 1. Personal Selling. Personal Selling is an effective way to manage personal customer relationships. The sales person acts on behalf of the organization. They tend to be well trained in the approaches and techniques of personal selling. However sales people are very expensive and should only be used where there is a genuine return on investment. For example salesmen are often used to sell cars or home improvements where the margin is high. 2. Sales Promotion. . Sales promotions tend to be thought of as being all promotions apart from advertising, personal selling, and public relations. For example the BOGOF promotion, or Buy One Get One Free. Others include couponing, money-off promotions, competitions, free accessories (such as free blades with a new razor), introductory offers (such as buy digital TV and get free installation), and so on. Each sales promotion should be carefully coated and compared with the next best alternative. 3. Public Relations (PR). Public Relation is defined as 'the deliberate, planned and sustained effort to establish and maintain mutual understanding between an organization and its publics' (Institute of Public Relations). PR can be relatively cheap, but it is certainly not free. Successful strategies tend to be long-term and plan for all eventualities. All airlines exploit PR; just watch what happens when there is an incident. The pre-planned PR machine clicks in very quickly with a very effective rehearsed plan. 4. Direct Marketing. Direct marketing is any marketing undertaken without a distributor or intermediary. In terms of promotion it means that the marketing company has direct communication with the customer. For example Nintendo distributes via retailers, although you can register directly with them for information which is often delivered by e-mail or mail. Direct mail is very highly focused upon targeting consumers based upon a database. As with all marketing, the potential consumer is targeted based upon a series of attributes and similarities. Creative agencies work with marketers to design a highly focussed communication in the form of a mailing. The mail is sent out to the potential consumers and responses are carefully monitored. For example, if you are marketing medical text books, you would use a database of doctors' surgeries as the basis of your mail shot. Similarly e-mail is a form of online direct marketing. You register, or opt in, to join a mailing list for your favorite website. You confirm that you have opted in, and then you will receive newsletters and e-mails based upon your favorite topics. You need to be able to unsubscribe at any time, or opt out. Mailing lists which generate sales are like gold dust to the online marketer. Make sure that you use a mailing list with integrity just as you would expect when you sign up. The mailing list needs to be kept up-to-date, and often forms the basis of online Customer Relationship Management (CRM). 5. Trade Fairs and Exhibitions. Such approaches are very good for making new contacts and renewing old ones. Companies will seldom sell much at such events. The purpose is to increase awareness and to encourage trial. They offer the opportunity for companies to meet with both the trade and the consumer.   6. Advertising. Advertising is a 'paid for' communication. It is used to develop attitudes, create awareness, and transmit information in order to gain a response from the target market. There are many advertising 'media' such as newspapers (local, national, free, trade), magazines and journals, television (local, national, terrestrial, satellite) cinema, outdoor advertising (such as posters, bus sides). There is much more about digital, online and Internet advertising further down this pages, as well as throughout Marketing Teacher and the Marketing Teacher Blog. 7. Sponsorship. Sponsorship is where an organization pays to be associated with a particular event, cause or image. Companies will sponsor sports events such as the Olympics or Formula One. The attributes of the event are then associated with the sponsoring organization. The elements of the promotional mix are then integrated to form a unique, but coherent campaign. 8. Online Promotions Online promotions will include many of the promotions mix elements which we considered above. For example advertising exists online with pay per click advertising which is marketed by Google. You can sponsor are website for example. Online businesses regularly send out newsletters which are targeted using e-mail and mailing lists, which is a form of direct marketing. Indeed websites are premium vehicle in the public relations industry to communicate particular points of view to relevant publics. The online promotions field is indeed emerging. The field will soon spread into Geo targeting of adverts to people in specific locations via smart phones. Another example would be how social media targets adverts to you whilst you socializing online. Take a look at Marketing Teacher's Blog for more up-to-date examples of the emerging online promotions space. 10. Physical Distribution: is concerned with making the goods and services available at the right place. It includes 2 important decisions: (i) Channels of Distribution means middleman or intermediaries

A channel of distribution or trade channel is defined as the path or route along which goods move from producers or manufacturers to ultimate consumers or industrial users. In other words, it is a distribution network through which producer puts his products in the market and passes it to the actual users. This channel consists of: - producers, consumers or users and the various middlemen like wholesalers, selling agents and retailers (dealers) who intervene between the producers and consumers. Therefore, the channel serves to bridge the gap between the point of production and the point of consumption thereby creating time, place and possession utilities. A channel of distribution consists of three types of flows:- Downward flow of goods from producers to consumers Upward flow of cash payments for goods from consumers to producers Flow of marketing information in both downward and upward direction i.e. Flow of information on new products, new uses of existing products, etc from producers to consumers. And flow of information in the form of feedback on the wants, suggestions, complaints, etc from consumers/users to producers. An entrepreneur has a number of alternative channels available to him for distributing his products. These channels vary in the number and types of middlemen involved. Some channels are short and directly link producers with customers. Whereas other channels are long and indirectly link the two through one or more middlemen.  These channels of distribution are broadly divided into four types:- Producer-Customer: - This is the simplest and shortest channel in which no middlemen is involved and producers directly sell their products to the consumers. It is fast and economical channel of distribution. Under it, the producer or entrepreneur performs all the marketing activities himself and has full control over distribution. A producer may sell directly to consumers through door-to-door salesmen, direct mail or through his own retail stores. Big firms adopt this channel to cut distribution costs and to sell industrial products of high value. Small producers and producers of perishable commodities also sell directly to local consumers. Producer-Retailer-Customer: - This channel of distribution involves only one middleman called 'retailer'. Under it, the producer sells his product to big retailers (or retailers who buy goods in large quantities) who in turn sell to the ultimate consumers. This channel relieves the manufacturer from burden of selling the goods himself and at the same time gives him control over the process of distribution. This is often suited for distribution of consumer durables and products of high value. Producer-Wholesaler-Retailer-Customer: - This is the most common and traditional channel of distribution. Under it, two middlemen i.e. wholesalers and retailers are involved. Here, the producer sells his product to wholesalers, who in turn sell it to retailers. And retailers finally sell the product to the ultimate consumers. This channel is suitable for the producers having limited finance, narrow product line and who needed expert services and promotional support of wholesalers. This is mostly used for the products with widely scattered market. Producer-Agent-Wholesaler-Retailer-Customer: - This is the longest channel of distribution in which three middlemen are involved. This is used when the producer wants to be fully relieved of the problem of distribution and thus hands over his entire output to the selling agents. The agents distribute the product among a few wholesalers. Each wholesaler distributes the product among a number of retailers who finally sell it to the ultimate consumers. This channel is suitable for wider distribution of various industrial products.

The marketing principle that insists goods should be at the right place at the right time to satisfy the needs of the consumer often confronts the producer with a dilemma. Among the benefits consumers seek from the goods they buy, one of the most significant is price economy. Yet in order to bring goods to the right place at the right time (and secure an acceptable profit margin), the producer must maintain an economic level of costs. A major factor mitigating against such economy, however, is the ever-increasing cost incurred in the physical movement of goods.

FUNCTIONS OF WAREHOUSING

1. A balance between supply and demand

Goods that are seasonally produced are stored in large quantities in the warehouse so that the supplies can be spread out throughout the year to meet the regular demand for the goods, e.g. wheat, paddy

2. Storage of goods at various stages of production

Warehousing is required at every stage of production. Raw materials are stored in the warehouse before production starts.

3. A place for product assembly, product aggregation and bulk breaking

Warehouses are located at convenient places where the products from different factories are brought together for bulk breaking.

4. Specialized services

Activities like weighing, sorting, grading, blending, bottling, packing and branding can be carried out in the warehouse.

5. A place for display of goods

Goods can be viewed and examined at the warehouse by potential buyers before placing purchase orders, or even by bankers, before giving out loans to the traders who use these goods as security.

IMPORTANCE OF WAREHOUSING

1. Stability of prices of goods

This is possible because goods stored in the warehouse can be released whenever there is a shortage of goods to meet the excess demand, and the excess supply can be stored in the warehouse.

2. Aids in production

Warehousing allows the manufacturer to continue with production in order to build up stocks that are required to meet the higher level of production during periods of rising demand.

3. An opportunity for saving on transportation costs

The warehouse is conveniently located near the markets so that the goods can be delivered promptly and at low transport cost.

4. Cost savings passed on to the consumers

Some wholesalers have turned warehouses into retail outlets where their customers can purchase goods directly from them. The savings in costs by the wholesalers (e.g. lower overheads, no transport costs, bulk purchases and cash sales)

5. Facilitation of foreign trade

Exporters have their goods ready in the warehouse near the port to await the arrival of ships to take them abroad. Warehouses are usually located near the harbor, airport or railway terminals.

TYPES OF WAREHOUSE

1. Bonded warehouse

1. Bonded warehouses store dutiable goods which cannot be removed until duty on them has been paid.

 2. These warehouses are under the control of the Custom and Excise Authorities.

Functions of bonded warehouse

1. They provide a space for imported goods to be stored until the duty is paid.

2. They enable the Customs and Excise Authorities to check on the entry of goods

3. They facilitate commerce because businessmen can carry on trade easily.

Importance of bonded warehouse

To the trader

1. Whilst goods are still in the bonded warehouse, the trader (importer) has access to these goods to perform the necessary operations like grading, packing and labeling,

2. The trader need not remove all his goods at once until it is convenient for him to do so.

To the manufacturer

1. (a) The manufacturer is assured of regular orders from overseas buyers who are freed from the financial strain of paying at once for the import duties

(b) In this way, the manufacturer's turnover will increase

(c) He only withdraws and pays duty for those goods he requires.

To the government

1. It enables collection and prevents evasion of customs duties.

2. It provides information on the goods imported and exported.

3. It gives the government some control over the goods imported and exported.

2. Cold storage

1. It is a special warehouse with refrigeration plants for storing perishables like meat, fish, fruit, vegetables, etc.

2. It is usually set up at terminal points like harbors, railway stations, airports.

3. Cash-and-carry warehouse

1. It is a self-service warehouse operated by manufacturers or wholesalers, where small retailers or even consumers can buy goods in bulk at low prices.

2. The small retailers or consumers pay cash for goods purchased and pick up these goods their own vans or cars.

3. Goods are sold at low prices in these warehouses because of the following reasons:

(a) Bulk purchases

(b) No credit facilities available

(c) No delivery facilities provided

4. Retailers’ regional distribution centers

These are large warehouses usually at large road junctions which supply many branches of a large-scale retailer e.g. supermarket.

5. Manufacturer's warehouse

1. The manufacturer's warehouses store only the type of goods produced by the manufacturer.

2. Some manufacturers may have their own warehouses or depots to store raw materials and finished products

6. Retail warehouse or depot

1. Some large-scale retailers, like supermarkets and departmental stores, make direct bulk purchases from manufacturers and may have their own warehouses or depots to store their goods.

2. Goods can be packed and branded in these warehouses

7. Wholesale warehouse

1. The specialist wholesaler assumes the responsibility and undertakes the risk and work of warehousing and distribution of goods to their destinations.

2. The wholesale warehouses store a variety of goods bought from many producers.

Transportation and its Functions

Transportation is the means to carry people and goods from one place to another. This has become very important in each stage of human civilization. If the present means of transportation were not developed, situation of the world would be totally different. Transportation has contributed much to the development of economic, social, political and cultural fields and uplifting their condition. Speedy industrialization is impossible without development of transportation. It is unavoidably necessary to promote transport system for the proper development of agricultural sector and rural areas. Without development of transportation neither mass production nor distribution is possible.

Transportation helps in mass production. Whether it is to purchase and bring raw materials or it is to distribute finished goods, one or the other means of transport is necessary. This expands old markets and creates new ones. As a result, demands for goods increases and production should also be increased. The contribution of transportation is very important to transport commodities to nooks and crannies of the world in a little time. If the development of transportation was not made, market would be limited in local areas and production would be limited to meet local needs only. As a result, economy of each country would remain in undeveloped condition.

Transportation helps much to the development of different industries, which produce perishable goods, such as fisheries, poultry firms, horticulture, dairy etc. Transport carries the perishable goods produced by such industries to the consumers living in different distant places in time. Otherwise such products would not be possible to supply to the consumers.

The role and contribution of transportation is very important in marketing. The functions of transport in marketing can be discussed as follows:

1. Physical Supply of Products

Transportation carries necessary raw materials to factory for production of goods and supplies finished goods to consumers. It creates place and time utility of goods by transporting from one place to another. It easily carries finished to the hands of those who need and use them. This significantly increases aggregate sales of goods. In fact, transport is such a key of marketing, which helps in carrying goods to the scattered consumers in different places, narrows the gap between producers and consumers and facilitates to distribute goods to the consumers at minimum cost and time.

2. Specialization

Transportation facility encourages division of labor and specialization on geographical or regional basis. Transportation cost highly affects localization of industries. Production of goods may center at such place where the environment is the best and production cost is minimum. This makes maximum utilization of local resources possible, which is both economically and socially necessary.

3. Mobility of Labor and Capital

Transportation facility provides mobility to labor and capital. If more labor force is available at any place, transport helps to carry it economically to necessary place. The means of transport carry labors from one place to another. This encourages labor and capital to use and invest in more productive sectors.

4. Stabilization in Price

Transportation helps to bring stability in price of different products. It transports goods from more supplied places to scarcely supplied areas. This establishes coordination between demand and supply, and brings stability in prices. It helps to supply necessary goods regularly to the consumers. Besides this, consumers get necessary goods at lower prices, because it encourages competition among producers and makes mass production at lower cost possible.

5. Other Importance

Beside economic importance, transportation has also social, political and cultural importance. It establishes social and utility by narrowing geographical distance. It consolidates social and cultural utility and strengthens national integration. It helps to establish relationship with foreign countries. Transportation also helps widen knowledge and skill in different sectors. In this way, it helps establish social utility, uniformity and integrity and strengthens national security.

So, transportation plays an important role in physical distribution system. It has also an important role in marketing function. In the lack of transportation, neither mass production nor distribution is possible. Transportation is important in social, economic, political and cultural aspects.

THE FOUR UTILITIES OF MARKETING

The marketing process must also add "utility" to the products consumers want.  Utility is the use or satisfaction a person gets from a product.  If you purchase a chain saw you anticipate that you will receive a certain amount of utility from it.  You will be able to use the saw to cut fire wood, prune trees, and take care of a variety of jobs around your home.  There are four types of utility.

Form Utility - a product must be processed into a form that the customer wants or needs.  For example, wheat is processed into bread, trees are processed into lumber, and potatoes are processed into French fries.  If you ordered French fries with your lunch and the waiter brought you a raw potato, you probably wouldn't be too happy.

Place Utility - place utility involves transporting products to the location where consumers can buy them.  If you live in Alaska, you certainly wouldn't want to have to drive to California to buy oranges.  Thanks to our modern transportation systems you don't have to; you simply drive to the local grocery store and oranges are there ready to add to your shopping cart place utility.

Ex. Trucking is one form of transportation that helps add Place Utility to products.

Possession Utility - possession utility establishes legal ownership of a product.  When you purchase something you normally receive a receipt; this provides legal ownership and the right to use the product.  Some products, computer software, for example, also provide a user license.  A license of this kind gives you the right to use the product within certain guidelines.

Ex. Stock certificates are proof of ownership. Stocks prove that you own part of a company. This is an example of Possession Utility.

Time Utility - this could be described as being in the right place at the right time when a customer is ready to purchase a product.  Creating and keeping customers means having products available for when they want them, and often this requires some type of storage facility.  Wheat is one example of a commodity that must be stored after it is harvested.  It is stored in silos until processors are ready to convert it into food products such as bread or cereals.

Ex. A silo is used to store grain products like wheat. This allows the product to be used by people when they need it; an example of Time Utility

Organizational Marketing:

Organizational marketing and job development are critical activities which,  if done well, will contribute to the supported employment participant’s success on the job, as well as the success of the entire organization.

An organization must approach these two distinct activities with creativity and a clear plan of action. Although organizational marketing and job development efforts are ongoing and occur concurrently, the desired outcomes of each are not necessarily the same.  Therefore, these terms are not synonymous or inter-changeable. Simply put, organizational marketing “sells” the unique service or services offered by a supported employment provider. Marketing efforts are directed toward two constituents: 1) community employers; and 2) job seekers with significant disabilities.  Specifically, the services that will be marketed to community employers will be the availability of a rich pool of personnel options, as well as employment centered consultation. Personnel features include dependable pre-screened applicants.

Consultation activities may consist of job analysis, job restructuring, and the Americans with Disabilities Act (ADA).  Supported employment organizational marketing was traditionally focused upon community employers, as the primary customer.  However, in a system which values choice and empowerment, and continues to debate economic control of service dollars in the hands of individuals with disabilities, supported employment organizations must begin to expand their vision of organizational marketing. Service providers now market and? Sell” their services to individuals with significant disabilities as well.  As discussed in the first section of this manual, the paradigm is shifting to a more tangible customer-driven approach to supported employment. 

 Job development, on the other hand, assists an individual to “sell” himself or herself for a specific employment position.  This is done by establishing a strong business network and by developing and maintaining an information system regarding potential job openings.  The primary customer during the job development process is the individual with the significant disability, also referred to as the job seeker.  The job seeker is actively involved, shaping his or her own role within job development activities. The organization must understand the important distinctions between organizational marketing and job development and appreciate the reasons why these two concepts are easily confused.  The underlying foundation of each of these processes is a strong customer-directed approach. The following table contrasts organizational marketing with job development by demonstrating the differences in the focus, customer, and outcomes.

Organizational marketing and job development are symbiotic or interrelated. That is, when an employment specialist is engaged in job development he or she can also be engaging in organizational marketing.  This occurs because both marketing and job development involve: 

Therefore, an organization might experience employment development benefits and/or outcomes while engaged in organizational marketing.   It is not unusual for an employment specialist or other representative (i.e. board member, family member, etc.) to find a job when conducting marketing activities. However, this does not always occur nor is it the objective.  Yet, this experience does explain how these two concepts often get confused. Ultimately, marketing will maintain and expand the organization’s networks.   When a job becomes an outcome of this process it is a secondary benefit. The following examples demonstrate two typical marketing contacts. 

In Example 1, the organizational marketing activity resulted in a strong job lead. 

Example 2 demonstrates how a new marketing contact heightened the understanding of a local supported employment organization’s services within the business community.

 While both examples may initially appear to have very different outcomes, the marketing network was enlarged in both instances.

Marketing Example 1: Stan Marker is a member of the board of directors for Resource, Inc., an employment service company. One evening Stan gave a brief presentation to his Community Club on behalf of Resource Inc.  Following the presentation, a club member contacted Stan to request a meeting with Resource, Inc. staff.  The community club member expressed an interest in hiring someone from Resource Inc. to fill an immediate need for a programmer in her company.  Stan immediately contacted the director of Resource Inc. to follow up on the job lead.

Marketing Example 2:

Kate Callahan is a family member of a person with a significant disability.  Kate recently contacted Carl Parkins, the personnel director, at her corporate office.  During their conversation, Kate inquired about current and future company job openings. Although there weren’t any at the time, Carl asked Kate about the employment? program” that her family member attended. Kate described for Carl some of the employment services that were available through her company, SEEK. Carl promptly placed SEEK on the mailing list for job opening announcements. As mentioned earlier, the organization has two primary customers: 1) individuals with significant disabilities; and 2) community employers. It is the responsibility of the organization and the employment specialist to meet the needs of both of these target groups.  Employers want individuals to fill available personnel positions who can meet company quality and production standards. Individuals with significant disabilities desire a job of choice which matches their respective interests, preferences, strengths, and career goals. To maintain a competitive position within a community marketplace, the organization must operate with this customer-focused philosophy. The remaining section will describe the best practices associated with supported employment’s customer-driven approach to organizational marketing.

BEST PRACTICES

Organizational marketing is not a great mystery.  Marketing concepts and strategies are not new, all is tried and true! Supported employment marketing, as with any other business, relies on traditional, established activities first implemented in the business community decades ago.  Often supported employment staff asks “What’s new?”  What could be considered as “new” is actually applying conventional business marketing practices and activities to supported employment services and organizations.  The first step in initiating organizational marketing activities will be for the entire organization to evaluate its respective focus, values, and “mind set.”  The organization assesses whether or not it has the marketing mind-set by addressing the following terms and “personalizing” them to their own reality or corporate framework.

The charge then becomes to approach marketing from a business perspective to link with other businesses within the community. Marketing-oriented agencies are driven by their customers wants and needs.   In fact, all activities are directed by the customers of the business.  This approach requires a firm commitment from management, as well as the entire organization for the necessary time, money, and staff investment to successfully implement goals and objectives.  All marketing activities and organizational practices must be integrated and coordinated.  The key is cooperation, not competition, within an organization!  Marketing is not solely intensive promotion; rather, it is a process of coordinating a set of activities to achieve customer satisfaction.

The Message

As supported employment organizations move about their business community, using competitive, business oriented language is crucial.  Marketing is an exchange of  valued goods  and services. Traditional marketing is a process in which the organization engages in several activities. These activities include the following areas:

# Gathering information about the environment,

# Determining benefits or wants people wish the agency to deliver,

# Setting marketing objectives,

# Determining which wants, and what portions of the community to serve,

# Developing a marketing plan, and

# Evaluating marketing efforts.

Crompton, J.L. & Lamb, C.W., 1986

Supported employment service providers are not human service agencies; rather, they are employment service agencies. This is a significant paradigm shift for many supported employment organizations, which assumes a competitive and valued offering of needed services.  The language is business to business; the message is: “Our company can fill your personnel needs!” This shift establishes an approach which presents the service, as well as individuals with significant disabilities, in a positive, competent, and respected manner.  In addition, it focuses the organization’s resources on the business community and is designed to satisfy employment needs.

Involving supported employment participants in the development of organizational marketing materials and the shaping of a marketing approach is key to organizational success.  Customer involvement further enhances an organization’s responsiveness to respective customer needs.  Job seekers also assist in identifying the services which will ultimately be provided. Yet, as discussed previously, a supported employment organization must develop a marketing approach that is specific to both constituent groups.  Employers are the primary target of marketing activities. The employment specialist or manager can interview employers to determine the specific factors and features that they deem essential when searching for qualified personnel to join their business.  This is also a productive exercise for supported employment personnel to become familiar with business terms and priorities.  The input received from community employers can be highlighted in a supported employment organization’s marketing materials. Not only is the message and language a very important aspect of marketing, so too is the expansion of the organization’s network. This and customer satisfaction are the primary goals of marketing. Thus, the organization must enlist everyone employed or connected with their respective business.  Mobilizing all associated networks will ensure continued growth.  No one is exempt from marketing; everyone needs to participate, including: supported employment participants, family members, board members, management, direct service, and administrative staff.

A Marketing Plan: Developing Marketing Strategy Organizational marketing requires a creative plan of action and ongoing evaluation. The plan of action identifies the niche or service identity, competition, resources, customers served, and the outcomes which are expected. The results of such planning and development provide an overall strategy and framework for achieving success.  Many of the questions which must be addressed in developing a marketing plan will overlap with similar themes. This will provide comprehensive information for the development of a marketing game plan. When developing a marketing plan, the organization must seek answers to several different questions.  The results or answers from these decisive questions will ultimately form the framework for the organizational marketing plan. 

DEVELOPING A FRAMEWORK FOR THE ORGANIZATIONAL MARKETING PLAN

What is the mission of the organization?  A typical organization may have a mission statement which addresses the integration of people with disabilities into competitive employment.  Yet, this is not enough.  The organization needs to develop a mission statement that is specific to organizational marketing. This type of statement would focus on assisting employers with successfully hiring and integrating people with disabilities into the work force.

Who is the audience? 

As mentioned earlier, supported employment organizations have two constituencies:  employers and job seekers.  Marketing activities are specifically designed and developed with the respective audience in mind.  Therefore, an organization must delineate the activities and materials for each of the two constituents.

What are the needs of the customers?

Once customers have been identified, a careful analysis will indicate specific needs.  These needs must drive the services offered by a customer responsive organization.  Possible employer needs may include:  consultation on ADA; competent personnel to fill specific positions; or assistance with environmental analysis, job analysis, and task analysis.  Job seekers, on the other hand, may need assistance with developing a resume; role playing an interview; identifying a job of choice; or developing a support network.

What services will be offered to satisfy the customers’ needs? 

Many companies offer a variety of services.  These include consultation regarding job and task analysis, job restructuring, information on ADA, employer labor source, job placement, family support, etc. Specific services should be marketed to specific audiences.  For example:  consultation and training on ADA is marketed to employers, job placement services are marketed to individuals with disabilities.

What are the economic trends? 

Canvassing the community to determine the types of companies, employment opportunities, and changes in the economic community is a critical component of marketing.  Conducting a community labor analysis of this type will determine the path the organization will pursue. Geographic areas differ in respect to the types of jobs available.  For example, a beach community may have a healthy tourist economy with heavy seasonal employment opportunities in the service industry, while a rural area may have jobs in farming, lumber, and service.  Or perhaps a mid-west town with a steadily deteriorating manufacturing industry is engaged in recruiting companies to the area in an effort to diversify the economic base.  Knowing what jobs exist in a community and developing economic areas will help determine a service niche.

What are the outcomes expected?

Out-comes include such indicators as: jobs of choice, careers, and employment satisfaction. Many organizations list as a goal that a certain number of individuals will be employed.  However, such goals do not address adequately the issue of quality.  Although the fiscal reality may require numbers, organizations must look at quality, not quantity, when engaging in organizational marketing. Outcomes must reflect elements of quality such as choice, control, careers, and person-centered processes in terms of job seeker needs.  Often, outcomes which address employer needs are not stated. If an organization is truly responsive to both of its constituents, then both perspectives must be represented and addressed to have success in the community marketplace. Outcomes must also include satisfied employers. Employer centered outcomes can be determined by analyzing general employer needs and then incorporating these needs into organizational goals.

What is the message to the customers?

The message is specifically designed to the customer.  Marketing materials such as brochures should be developed for each of the customer groups:  job seekers and employers.  An organization should have a promotional brochure which addresses the needs of employers, as well as a separate brochure designed to address the needs of individuals with disabilities.  Often, marketing materials become outdated but are used even though they do not communicate an accurate message.  For example, it is confusing to businesses to read a brochure which highlights the service of “putting people with disabilities in community jobs.”  Instead, the message for employers is “identifying employees to meet the personnel needs of today’s business community.”  Using one large promotional brochure may initially cost less, but in the end will only short change marketing efforts. The message of promotional materials should be professional and concise.

What are the resources?

 This includes financial and personnel resources.  What percentage of the budget is available for developing marketing materials and engaging in marketing activities?  Which staff is available to conduct marketing?  Again, it is critical that everyone in the organization is involved in some capacity.  An organization must ask itself if everyone in the organization will conduct direct marketing.  Or perhaps one individual will be hired to perform marketing on a part time or full time basis. Arguably, a more effective strategy would be to actively engage everyone in marketing endeavors.  However, organizations often overlook marketing as they respond to the day-to-day happenings. In this case, perhaps having one staff person totally committed to organizational marketing would ensure continued networking.  The bottom line is that resources must be committed in order to implement a marketing plan which will ensure a competitive edge and fill the needs of customers.

What is the promotional plan? 

What tools will be used?  A promotional plan involves determining the most cost-effective marketing strategies based on the resources available and the outcomes desired.  It would be an ideal world indeed if organizations had unlimited marketing budgets.  This is not the case, and the organization must get “the biggest bang for their buck”.  Activities may include public service announcements, public speaking, attending community and civic meetings, offering specific training to employers and word of mouth advertising by customers.  The plan also includes marketing materials or tools such as brochures, flyers, business cards, etc. Although these are traditional approaches, it is important to conduct them with specificity according to the customer and to remember to use business language.  Creative marketing will call for many non-traditional methods which are designed to further stimulate an organization’s well being.  For example, a non-traditional method would include purchasing advertising placards which are placed at the tee boxes of each hole for a local fund raising golf tournament.  The intent of such a strategy is to become known within the community.  Additional strategies may include mass faxes, magazine and newspaper articles and advertisements, inserts in corporate and business newsletters, posted information at public places, web page on the Internet, and pens, notepads etc. with the company logo.

How will success be determined?

Using this checklist or one developed by your organization will ensure that all steps in the marketing process are completed.  A responsible staff person should be identified next to each content area and the date that the activity is actually completed should be included.  This will help ensure that all steps in the marketing process are completed within realistic time lines and that responsible individuals are identified for each area.  Once this is completed the next step is to develop the actual marketing plan. The following table outlines the marketing process, with the remaining sections of this chapter giving further details for implementation

Mission Statement

A mission statement is the compass of an organization and directs marketing efforts. The mission shows the goal of the organization, how it will be accomplished, and the benefits to stakeholders.  A mission should be clear and concise, providing the direction for all organizational activities.  Every stakeholder of an organization should know the mission and what it truly means.  This statement should not be just words on paper.  Values and philosophy are directly reflected within this statement.

Example:

Our mission is to facilitate customer driven employment services within the community.  We will accomplish this by delivering quality services to both customer groups:  employers and job seekers.  This will provide maximum value and opportunities for integrated employment of choice, as well as efficient and responsive personnel options for employers.

Environmental Analysis

The end result of completing an environmental analysis is the identification of the competition, the service niche, and the target groups to be served.  Identifying competitors and target groups assists in determining if there is enough demand for specific services.  Establishing a service identity will enhance one’s competitive standing in the marketplace.  As a service provider, the goal is to acquire the edge among competitors and to fill an unmet service need which determines a unique niche. The following example demonstrates how this can be accomplished.

Environmental Case Study:

Southson, a mid-size community in the Southwest, has one supported employment provider, Vista Employment Services. This organization concentrates on entry level positions in the food service industry.  Their customer base is largely made up of individuals with mental retardation.  A new company, Careers Unlimited, is opening a sup-ported employment business in Southson.  After reviewing the existing competitor, Careers Unlimited determined that employers were in need of a variety of employees across job positions.  Thus, the niche identified by Careers Unlimited was marketing to employers across the spectrum of vocational opportunities and not limiting the choice of potential jobs, nor the population served.  With this strategy, the new service provider has created a niche. It is filling a capacity previously not offered in the community. In addition, the new supported employment company is expanding opportunities for customer choice. An organization needs to acquire as much information as possible about local competitors to reduce duplication of services and to ensure their own success.  Once a decision is made as to the customers to be served and businesses to be targeted, an organization has then positioned itself as a viable business in the community.  By doing these things, an image is created which the community recognizes and identifies with a specific organization.  Creating a competitive image or service identity will drive marketing activities.  Customers and the public at large will know exactly what the organization does and the value they can expect from the organization as a provider of quality supported employment services. Supported employment providers may provide services to individuals with physical, cognitive, and mental disabilities, while other organizations may limit or narrow their services to individuals with a specific disability such as mental retardation or sensory disabilities.  In addition, providers may look for employment from businesses throughout the community, while others may concentrate on specific industries based on either size, type of business, location, or past history.  These important decisions will vary from organization to organization.  The key to success is com pleting a thorough environmental analysis which in turn drives the decisions an organization makes. The major components of an environmental analysis are the identification of stakeholders, conducting consumer research and completing a SWOT analysis:  strengths, weaknesses, opportunities, and threats.

Stakeholders:

Stakeholders are individuals who are invested in the mission and success of the organization. These players are the manifestation of the values and philosophy held by the supported employment organization.  They have a commitment to the objectives of the organization and work to ensure success in reaching these objectives (RRTC Marketing Newsletter, 1995).  Stakeholders may include people with disabilities, family members, board members, staff, community members, employers, professional organizations, human service agency staff, etc.  An organization must determine the needs, wants, level of satisfaction, and involvement of all stakeholders. Identification of Customers and Resources.  The ability of an organization to be successful depends on how well it defines its customers and the resources available to reach the identified goals.  The organization’s strengths, weaknesses, and limitations must be understood.  If a young supported employment organization attempted to provide employment services to all individuals with significant disabilities, they might quickly realize that resources were being spread too thinly and that their services were not cost effective.   A broad and diverse customer base could strain many organizational resources such as staff, expertise, and/or funds. The same is true for supported employment service providers who attempt to work with all community businesses.  The provider organization needs to understand the labor market in which business is being con-ducted and develop a plan to target appropriate businesses.  An organization exploring a marketing philosophy must analyze and determine the most appropriate business groups they will serve.  The identification and selection of target groups will effect decisions regarding types of services, where and how services will be delivered, cost of services, personnel, and staff training needs.  Job seeker choice is a critical aspect which must also be addressed when determining target employers.  Identifying customers and resources will ultimately assist in identifying a company’s niche and image.

SWOT Analysis. 

 The SWOT, an acronym representing strengths, weaknesses, opportunities, and threats, analysis is an internal and external assessment of the organization. The results of the analysis helps an organization determine services to be offered.  An organization assesses their strengths, weaknesses, opportunities, and threats. Strengths and weaknesses are internal features of the organization.  Examples of strengths may include dedicated and experienced staff and board members, customer centered services, excellent community image, and a large network.  Weaknesses may include limited resources for staff training, a long waiting list, limited staff, and a fragmented network.  Opportunities are positive actions an organization can take.  These may include access to supportive employers, attending personnel training workshops, networking with a supportive school system.  Threats are aspects which may negatively affect an organization. Threats may include lack of referrals, competition, negative community image of supported employment, or lack of funding.  Once an organizational analysis has been conducted, an organization will then attempt to minimize the threats and weaknesses and highlight opportunities and strengths.

SWOT Case Study

Crestview Employment, Inc. was having difficulty marketing and providing ser-vices. Crestview conducted a SWOT analysis. Strengths included mission and services determined by customers, and an operating budget in “black ink.”  Weaknesses included high staff turnover, low staff morale, and low pay.  Opportunities included a variety of businesses available in the community and a good working relationship with the state rehabilitation services agency.  Threats include high staff turnover and broken services (periods in which remaining staff needed to support customers of a departing co-worker and inability to provide consistent services.) Using the information collected in the SWOT analysis, Crestview pursued the following:

By addressing these weaknesses and threats, Crestview was able to maximize their strengths and opportunities.  Morale has increased and turnover has not been an issue in the last six months.  Employment opportunities have also increased for customers.

BENEFITS OF ORGANIZATIONAL MARKETING

Supported employment providers, rehabilitation agencies, and other social service public organizations usually ask two questions when attempting to convert to marketing oriented approach: 1) what are the benefits? and 2) when will I see the benefits?  A manager of a service organization must realize that people come to an organization not for the particular services offered, but for the expectation that the service or program will benefit them somehow.  Over the past few years, many rehabilitation and supported employment programs have come to view themselves less as a rehabilitation provider and more as an employment services business.  Once an organization starts designing its program and services around the benefits to its customers, it will be able to see the benefits to the organization.  Marketing efforts do not always have an immediate effect or result.  Patience and perseverance are important assets for today’s market place.  A marketing plan requires continual assessment and evaluation to determine the necessary resources to effectively implement the plan.  A competitive organization looks beyond immediate issues and focuses on the long term or the future.  Yet, one ingredient that is often overlooked is cost.  Cost, as well as benefits to the customers, and the organization as a whole, is very important to achieving the marketing plan and ultimately marketing success.  As discussed earlier, marketing consists of many interested and involved stakeholders.  Albeit, the primary customers are the individuals with significant disabilities and community employers.  In successful marketing, each of the customers glean certain benefits. Customer Benefits.  Individuals with a significant disability stand to gain several benefits from a strong organizational marketing approach.  Most importantly, they will be assured that the services of the organization will be tailored to meet their unique needs. The following section lists possible customer benefits.

Employer Benefits. 

 Supported employment and other rehabilitation organizations must be proactive when identifying the employer’s wants and needs. This approach allows the organization to design their services in response to employer expectations and will result in clear-cut benefits to the employer. The following is a list of benefits that employers can expect.

Organizational Benefits

Every organization, business, or agency engages in some type of marketing activity. The question is, how well is it done on an organizational level and how effective are the outcomes?  When marketing is done correctly, the results and benefits are varied and plentiful.  Possible organizational benefits include the following:

SUMMARY

A market-based organization acknowledges the on-going nature of marketing activities, as well as the need for regular evaluation. Organizational marketing is indeed rewards are well worth the effort.  A competitive supported employment business which utilizes creativity and a clear plan of action will surely maximize resources, thus encouraging success!

For the small business, there are several different organisational approaches to marketing. The duty may lie with a single member of the team, or it could be a group responsibility. The great thing about a small team is the ability to quickly instill a marketing led ethos which can become the operational soul of your business.

Depending on budget availability and the skills of the team, you may choose to outsource certain elements of the marketing process (such as market research) or decide to do these jobs in-house. Key responsibilities of the marketing manager / director vary according to the business but can include:

The marketing role can be diverse or focused but now we'll elaborate further on some key aspects which should be at the heart of the job.

Market Research

Marketing managers need to have a good knowledge of the customer. This means building up an accurate picture using the resources that are available. It is important to take personal opinion out of as many decisions as possible – you probably don't think in the same way as a typical customer. Information can be gathered from questionnaires, focus groups, the internet, interviews, buying habits and many more sources, but it's important that the information is examined in a scientific way using proper statistical methods. Gut feel can only take your business so far.

Development of Marketing Strategy and Plan:

Marketing planning should be at the core to any business and is usually presented in the form of a written marketing plan. A consultant called Paul Smith first developed a process known as SOSTAC® which is a useful model used to structure a marketing plan. SOSTAC is an acronym for the following elements of the plan:

Situation Analysis – where are we now?

The marketing plan should provide direction for all relevant members of the organization and should be referred to an updated throughout the year. The main reason for the marketing plan is that it provides a structured approach that forces the marketing manager to consider all the relevant elements of the planning process which might be missed if a more rushed approach is adopted

Management of the Marketing Mix

The marketing mix includes all tangible elements that allow you to market your product. This includes facilities, your employees, the product itself, the cost strategy, the process of selling, and how you promote and advertise. The extent to which the marketing manager gets involved in these elements depends on how marketing focused your business is. A product focused organization will probably start with an idea for a new product, then try and determine who is likely to buy it. A marketing focused business starts with the consumer and tried to figure out what they want to buy. Some product focused businesses are very successful but it is generally accepted that a marketing focus provides a greater chance of success.

Customer Relation Management (CRM)

Customer relationship management is the process of communicating with customers throughout the various stages of the purchasing process, and this includes people who have already bought from you. It is significantly easier to hold on to an existing customer than it is to find new ones, but doing this requires all elements of the marketing mix to be run well. For example, it's no use sending out a beautifully produced customer magazine if your customer service is dreadful or the product breaks easily. 

Managing Agencies

It is unlikely that a small business will have the skills in-house to develop all elements of the marketing mix. Websites, brochures, and other promotional items will usually involve some form of outsourced help such as graphic design or printing. Careful management of these agencies is essential to provide an integrated marketing approach to promotion. Agency management involves the development of detailed project briefs, signing off creative work and ensuring the work is delivered on time. Depending on the volume of work which is outsourced, you may feel it is worth developing some guidelines to ensure a consistent style across different media. 

Measuring Success

An important element of the marketing manager's role which is often neglected is the process of collecting and analyzing data on success. This can take the form of website hits, sales figures, market share data, customer satisfaction or many other metrics and it's important to record and track these as a core part of the marketing process.

Final Words

Marketing managers have a diverse and varied job, and promotion should just be one element of the scope. Championing a marketing focused business structure will provide a greater chance of success in today's challenging business environment and will lead to a more sustainable future.

9. Personality

A bit of personality goes a long way in marketing. When you speak with an entrepreneur or business leader and ask them about the personality of their favourite marketing manager, the answer will always be along the lines of 'having a great personality, straight-forward, strategic and a bit of fun'. Remember, as a marketing manager, you are not an accountant or lawyer. People expect you to be well presented, on top of your game, innovative and confident.

MARKETING ENVIRONMENT

In order to correctly identify opportunities and monitor threats, the company must begin with a thorough understanding of the marketing environment in which the firm operates. The marketing environment consists of all the actors and forces outside marketing that affect the marketing management’s ability to develop and maintain successful relationships with its target customers. Though these factors and forces may vary depending on the specific company and industrial group, they can generally be divided into broad micro environmental and macro environmental components. For most companies, the micro environmental components are: the company, suppliers, marketing channel firms (intermediaries), customer markets, competitors, and publics which combine to make up the company’s value delivery system. The macro environmental components are thought to be: demographic, economic, natural, technological, political, and cultural forces. The wise marketing manager knows that he or she cannot always affect environmental forces. However, smart managers can take a proactive, rather than reactive, approach to the marketing environment.

As marketing management collects and processes data on these environments, they must be ever vigilant in their efforts to apply what they learn to developing opportunities and dealing with threats. Studies have shown that excellent companies not only have a keen sense of customer but an appreciation of the environmental forces swirling around them. By constantly looking at the dynamic changes that are occurring in the aforementioned environments, companies are better prepared to adapt to change, prepare long-range strategy, meet the needs of today’s and tomorrow’s customers, and compete with the intense competition present in the global marketplace. All firms are encouraged to adopt an environmental management perspective in the new millennium.

A company’s marketing environment consists of the actors and forces outside marketing that affect marketing management’s ability to develop and maintain successful relationships with its target customers.

5). Systematic environmental scanning helps marketers to revise and adapt marketing strategies to meet new challenges and opportunities in the marketplace. The marketing environment is made up of a:

2. Macro environmental

1. Micro Environmental

The microenvironment consists of five components. The first is the organization’s internal environment—its several departments and management levels—as it affects marketing management's decision making. The second component includes the marketing channel firms that cooperate to create value: the suppliers and marketing intermediaries (middlemen, physical distribution firms, marketing-service agencies, financial intermediaries). The third component consists of the five types of markets in which the organization can sell: the consumer, producer, reseller, government, and international markets. The fourth component consists of the competitors facing the organization. The fifth component consists of all the publics that have an actual or potential interest in or impact on the organization’s ability to achieve its objectives: financial, media, government, citizen action, and local, general, and internal publics. So the microenvironment consists of six forces close to the company that affect its ability to serve its customers:

1. The Company’s Microenvironment

As discussed earlier the company’s microenvironment consists of six forces that affect its ability to serve its customers. Let’s discuss these forces in detail:

a. The Company

The first force is the company itself and the role it plays in the microenvironment. This could be deemed the internal environment.

1). Top management is responsible for setting the company’s mission, objectives, broad strategies, and policies.

b. Suppliers

Suppliers are firms and individuals that provide the resources needed by the company and its competitors to produce goods and services. They are an important link in the company’s overall customer “value delivery system.”

1). One consideration is to watch supply availability (such as supply shortages).

c. Marketing Intermediaries

Marketing intermediaries are firms that help the company to promote, sell, and distribute its goods to final buyers.

Physical distribution firms help the company to stock and move goods from their points of origin to their destinations. Examples would be warehouses (that store and protect goods before they move to the next destination).

Marketing service agencies (such as marketing research firms, advertising agencies, media firms, etc.) help the company target and promote its products.

Financial intermediaries (such as banks, credit companies, insurance companies, etc.) help finance transactions and insure against risks.

d. Customers

The company must study its customer markets closely since each market has its own special characteristics. These markets normally include:

e. Competitors

Every company faces a wide range of competitors. A company must secure a strategic advantage over competitors by positioning their offerings to be successful in the marketplace. No single competitive strategy is best for all companies.

f. Publics

A public is any group that has an actual or potential interest in or impact on an organization’s ability to achieve its objectives. A company should prepare a marketing plan for all of their major publics as well as their customer markets. Generally, publics can be identified as being:

The company and all of the other actors operate in a larger macro environment of forces that shape opportunities and pose threats to the company. There are six major forces (outlined below) in the company’s macro environment. There are six major forces (outlined below) in the company’s macro environment.

Demography is the study of human populations in terms of size, density, location, age, sex, race, occupation, and other statistics. It is of major interest to marketers because it involves people and people make up markets. Demographic trends are constantly changing. Some more interesting ones are.

The economic environment includes those factors that affect consumer purchasing power and spending patterns. Major economic trends in the United States include:

The natural environment involves natural resources that are needed as inputs by marketers or that are affected by marketing activities. During the past two decades environmental concerns have steadily grown. Some trend analysts labeled the specific areas of concern were:

Staples such as air, water, and wood products have been seriously damaged and non-renewable such as oil, coal, and various minerals have been seriously depleted during industrial expansion.

is a worldwide problem. Industrial damage to the environment is very serious. Far-sighted companies are becoming “environmentally friendly” and are producing environmentally safe and recyclable or biodegradable goods. The public response to these companies is encouraging. However, lack of adequate funding, especially in third world countries, is a major barrier.

in natural resource management has caused environmental concerns to be more practical and necessary in business and industry. Leadership, not punishment, seems to be the best policy for long-term results. Instead of opposing regulation, marketers should help develop solutions to the material and energy problems facing the world.

 The so-called green movement has encouraged or even demanded that firms produce strategies that are not only environmentally friendly but are also environmentally proactive. Firms are beginning to recognize the link between a healthy economy and a healthy environment.

The technological environment includes forces that create new technologies, creating new product and market opportunities.

The political environment includes laws, government agencies, and pressure groups that influence and limit various organizations and individuals in a given society. Various forms of legislation regulate business.

2). Changing government agency enforcement. New laws and their enforcement will continue or increase.

3). Increased emphasis on ethics and socially responsible actions. Socially responsible firms actively seek out ways to protect the long-run interests of their consumers and the environment.

The cultural environment is made up of institutions and other forces that affect society’s basic values, perceptions, preferences, and behaviors. Certain cultural characteristics can affect marketing decision-making. Among the most dynamic cultural characteristics are:

1). Persistence of cultural values. People’s core beliefs and values have a high degree of persistence. Core beliefs and values are passed on from parents to children and are reinforced by schools, churches, business, and government. Secondary beliefs and values are more open to change.

2). Shifts in secondary cultural values. Since secondary cultural values and beliefs are open to change, marketers want to spot them and be able to capitalize on the change potential. Society’s major cultural views are expressed in:

To understand the proper role of information systems one must examine what managers do and what information they need for decision making. We must also understand how decisions are made and what kinds of decision problems can be supported by formal information systems. One can then determine whether information systems will be valuable tools and how they should be designed.

The concept of marketing information systems has been around for many years. Early systems were paper-based systems but, with the emergence of computers with large storage capacities and later microcomputers with similar features, marketing information systems have become more "electronic" in nature. MIS (marketing information systems) can be classified under five headings:

·     Planning systems - which provide information on sales, costs and competitive activity, together with any kind of information which is needed to formulate plans.

·     Control systems - these provide continuous monitoring of marketing activities and enable marketing executives to identify problems and opportunities in the marketplace. At the same time, they permit a more detailed and comprehensive review of performance against plans.

·     Marketing research systems - such systems allow executives to test decision rules and cause/effect hypotheses. This permits the assessment of the effects of marketing actions and encourages improved learning from experience.

·     Monitoring systems - these systems provide management with information concerning the external environment in which they are operating.

One can define a marketing information system as one which scans and collects data from the environment, makes use of data from transactions and operations within the firm and then filters, organizes and selects data before presenting them as information to management.

Objectives

This chapter has the purpose of leading the reader towards:

Ø  An understanding of the different roles managers play and how marketing information systems can support them in these roles

Ø  An appreciation of the different types and levels of marketing decision making

Ø  A knowledge of the major components of a marketing information system

Ø  An awareness of the often under-utilized internal sources of information available to enterprises

Ø  An ability to clearly distinguish between marketing research and marketing intelligence, and

Ø  An understanding of the nature of analytical models within marketing information system.

The Need for Marketing Information

Managers require information to help them forecast changes in product demand, increase selling Productivity, and exercise control over sales and distribution expenses. Marketing is an ongoing process; decisions are made and results of these decisions have monitored. Consumer and competitor reactions to the company's decisions have to be studied to ensure that the best strategy is being employed. Information on these matters is used to correct deviations from plans. For example, if a target of a 5 per cent increase in new clients has been set for the sales force then it is necessary to monitor how effective the sales force is in terms of reaching the target set. Such information can then be used to adjust targets, if the need arises.

Information is needed for decision making. Unfortunately, in many firms, it is often difficult to obtain information of the right kind. The kinds of complaints one often encounters are:

·     There is too much information of the wrong kind.

·     There is not enough information of the right kind.

·     Information is too dispersed to be useful.

·     Information arrives too late to be useful.

·     Information often arrives in a form that leaves no idea of its accuracy and therefore lacks credibility.

Clearly, there is a need to overcome these kinds of problems and complaints and it is for this reason that marketing information systems have evolved.

Structure

The chapter opens with a wide-ranging discussion of the functions of management, the various types and levels of decision that marketing managers must make. This then comprises the first half of the chapter whilst the second pan deals with the main components of a marketing information systems.. Internal reporting systems, marketing research systems, marketing intelligence systems and analytical model banks are all discussed.

The Functions of Management

Clearly, information systems that claim to support managers cannot be built unless one understands what managers do and how they do it. The classical model of what managers do, espoused by writers in the 1920's, such as Henry Fayol, whilst intuitively attractive in itself, is of limited value as an aid to information system design. The classical model identifies the following 5 functions as the parameters of what managers do:

1 Planning

Such a model emphasizes what managers do, but not how they do it, or why. More recently, the stress has been placed upon the behavioral aspects of management decision making. Behavioral models are based on empirical evidence showing that managers are less systematic, less reflective, more reactive and less well organized than the classical model projects managers to be. For instance, behavioral models describe 6 managerial characteristics:

Ø  High volume, high speed work

Ø  Variety, fragmentation, brevity

Ø  Issue preference current, ad hoc, specific

Ø  Complex web of interactions, contacts

Ø  Strong preference for verbal media.

Such behavioral models stress that managers work at an unrelenting pace and at a high level of intensity. This is just as true for managers operating in the developing world as in the developed world. The nature of the pressures may be different but there is no evidence that they are any less intense. The model also emphasizes that the activities of managers is characterized by variety, fragmentation and brevity. There is simply not enough time for managers to get deeply involved in a wide range of issues. The attention of managers increase rapidly from one issue to another, with very little pattern. A problem occurs and all other matters must be dropped until it is solved. Research suggests that a manager's day is characterized by a large number of tasks with only small periods of time devoted to each individual task.

Managers prefer speculation, hearsay; gossip in brief, current, up-to-date, although uncertain information. Historical, certain, routine information receives less attention. Managers want to work on issues that are current, specific and ad hoc.

Managers are involved in a complex and diverse web of contacts that together act as an information system. They converse with customers, competitors, colleagues, peers, secretaries, government officials, and so forth. In one sense, managers operate a network of contacts throughout the organization and the environment.

Several studies have found that managers prefer verbal forms of communication to written forms. Verbal media are perceived to offer greater flexibility, require less effort and bring a faster response. Communication is the work of the manager, and he or she uses whatever tools are available to be an effective communicator.

Despite the flood of work, the numerous deadlines, and the random order of crises, it has generally been found that successful managers appear to be able to control their own affairs. To some extent, high-level managers are at the mercy of their subordinates, who bring to their attention crises and activities that must be attended to immediately. Nevertheless, successful managers are those who can control the activities that they choose to get involved in on a day-to-day basis. By developing their own long-term commitments, their own information channels, and their own networks, senior managers can control their personal agendas. Less successful managers tend to be overwhelmed by problems brought to them by subordinates.

Managerial Roles

Mintzberg suggests that managerial activities fall into 3 categories: interpersonal, information processing and decision making. An important interpersonal role is that of figurehead for the organization. Second, a manager acts as a leader, attempting to motivate subordinates. Lastly, managers act as a liaison between various levels of the organization and, within each level, among levels of the management team.

A second set of managerial roles, termed as informational roles, can be identified. Managers act as the nerve centre for the organization, receiving the latest, most concrete, most up-to-date information and redistributing it to those who need to know.

A more familiar set of managerial roles is that of decisional roles. Managers act as entrepreneurs by initiating new kinds of activities; they handle disturbances arising in the organization; they allocate resources where they are needed in the organization; and they mediate between groups in conflict within the organization.

In the area of interpersonal roles, information systems are extremely limited and make only indirect contributions, acting largely as a communications aid in some of the newer office automation and communication-oriented applications. These systems make a much larger contribution in the field of informational roles; large-scale MIS systems, office systems, and professional work stations that can enhance a manager's presentation of information are significant. In the area of decision making, only recently have decision support systems and microcomputer-based systems begun to make important contributions.

While information systems have made great contributions to organizations, until recently these contributions have been confined to narrow, transaction processing areas. Much work needs to be done in broadening the impact of systems on professional and managerial life.

Decision Making

Decision making is often seen as the centre of what managers do, something that engages most of a managers time. It is one of the areas that information systems have sought most of all to affect (with mixed success). Decision making can be divided into 3 types: strategic, management control and operations control.

Strategic decision making: This level of decision making is concerned with deciding on the objectives, resources and policies of the organization. A major problem at this level of decision making is predicting the future of the organization and its environment, and matching the characteristics of the organization to the environment. This process generally involves a small group of high-level managers who deal with very complex, non-routine problems.

For example, some years ago, a medium-sized food manufacturer in an East African country faced strategic decisions concerning its range of pasta products. These products constituted a sizeable proportion of the company's sales turnover. However, the company was suffering recurrent problems with the poor quality of durum wheat it was able to obtain resulting in a finished product that was too brittle. Moreover, unit costs were shooting up due to increasingly frequent breakdowns in the ageing equipment used in pasta production. The company faced the decision whether to make a very large investment in new machinery or to accept the offer of another manufacturer of pasta products, in a neighboring country, that it should supply the various pasta products and the local company put its own brand name on the packs. The decision is strategic since the decision has implications for the resource base of the enterprise, i.e. its capital equipment, its work force, its technological base etc. The implications of strategic decisions extend over many years, often as much as ten to fifteen years.

Management control decisions: Such decisions are concerned with how efficiently and effectively resources are utilized and how well operational units are performing. Management control involves close interaction with those who are carrying out the tasks of the organization; it takes place within the context of broad policies and objectives set out by strategic planners.

An example might be where a transporter of agricultural products observes that his/her profits are declining due to a decline in the capacity utilization of his/her two trucks. The manager (in this case the owner) has to decide between several alternative courses of action, including: selling of trucks, increasing promotional activity in an attempt to sell the spare carrying capacity, increasing unit carrying charges to cover the deficit, or seeking to switch to carrying products or produce with a higher unit value where the returns to transport costs may be correspondingly higher. Management control decisions are more tactical than strategic.

Operational control decisions: These involve making decisions about carrying out the " specific tasks set forth by strategic planners and management. Determining which units or individuals in the organization will carry out the task, establishing criteria of completion and resource utilization, evaluating outputs - all of these tasks involve decisions about operational control.

The focus here is on how the enterprises should respond to day-to-day changes in the business environment. In particular, this type of decision making focuses on adaptation of the marketing mix, e.g. how should the firm respond to an increase in the size of a competitor's sales force? should the product line be extended? should distributors who sell below a given sales volume be serviced through wholesalers rather than directly, and so on.

Within each of these levels, decision making can be classified as either structured or unstructured. Unstructured decisions are those in which the decision maker must provide insights into the problem definition. They are novel, important, and non-routine, and there is no well-understood procedure for making them. In contrast, structured decisions are repetitive, routine, and involve a definite procedure for handling them so that they do not have to be treated each time as if they were new.

Structured and unstructured problem solving occurs at all levels of management. In the past, most of the success in most information systems came in dealing with structured, operational, and management control decisions. However, in more recent times, exciting applications are occurring in the management and strategic planning areas, where problems are either semi-structured or are totally unstructured.

Making decisions is not a single event but a series of activities taking place over time. Suppose, for example, that the Operations Manager for the National Milling Corporation is faced with a decision as to whether to establish buying points in rural locations for the grain crop. It soon becomes apparent that the decisions are likely to be made over a period of time, have several influences, use many sources of information and have to go through several stages. It is worth considering the question of how, if at all, information systems could assist in making such a decision. To arrive at some answer, it is helpful to break down decision making into its component parts.

The literature has described 4 stages in decision making: intelligence, design, choice and implementation. That is, problems have to be perceived and understood; once perceived solutions must be designed; once solutions are designed, choices have to be made about a particular solution; finally, the solution has to be implemented.

Intelligence involves identifying the problems in the organization: why and where they occur with what effects. This broad set of information gathering activities is required to inform managers how well the organization is performing and where problems exist. Management information systems that deliver a wide variety of detailed information can be useful, especially if they are designed to report exceptions. For instance, consider a commercial organization marketing a large number of different products and product variations. Management will want to know, at frequent intervals, whether sales targets are being achieved. Ideally, the information system will report only those products/product variations which are performing substantially above or below target.

Designing many possible solutions to the problems is the second phase of decision making. This phase may require more intelligence to decide if a particular solution is appropriate. Here, more carefully specified and directed information activities and capabilities focused on specific designs are required.

Choosing among alternative solutions is the third step in the decision making process. Here a manager needs an information system which can estimate the costs, opportunities and consequences of each alternative problem solution. The information system required at this stage is likely to be fairly complex, possibly also fairly large, because of the detailed analytic models required to calculate the outcomes of the various alternatives. Of course, human beings are used to making such calculations for themselves, but without the aid of a formal information system, we rely upon generalization and/or intuition. 

In practice, the stages of decision making do not necessarily follow a linear path from intelligence to design, choice and implementation. Consider again the problem of balancing the costs and benefits of establishing local buying points for the National Milling Corporation. At any point in the decision making process it may be necessary to loop back to a previous stage. For example, one may have reached stage 3 and all but decided that having considered the alternatives of setting up no local buying points, local buying points in all regions, districts or villages, the government decides to increase the amounts held in the strategic grain reserve. This could cause the parastatal to return to stage 2 and reassess the alternatives. Another scenario would be that having implemented a decision one quickly receives feedback indicating that it is not proving effective. Again, the decision maker may have to repeat the design and/or choice stages.

Thus, it can be seen that information system designers have to take into account the needs of managers at each stage of the decision making process. Each stage has its own requirements.

Components of a marketing information system

A marketing information system (MIS) is intended to bring together disparate items of data into a coherent body of information. An MIS is, as will shortly be seen, more than raw data or information suitable for the purposes of decision making. An MIS also provides methods for interpreting the information the MIS provides. Moreover, as Kotler's¹ definition says, an MIS is more than a system of data collection or a set of information technologies:

"A marketing information system is a continuing and interacting structure of people, equipment and procedures to gather, sort, analyze, evaluate, and distribute pertinent, timely and accurate information for use by marketing decision makers to improve their marketing planning, implementation, and control".

Figure illustrates the major components of an MIS, the environmental factors monitored by the system and the types of marketing decision which the MIS seeks to underpin.

 The explanation of this model of an MIS begins with a description of each of its four main constituent parts: the internal reporting systems, marketing research system, marketing intelligence system and marketing models. It is suggested that whilst the MIS varies in its degree of sophistication - with many in the industrialized countries being computerized and few in the developing countries being so - a fully fledged MIS should have these components, the methods (and technologies) of collection, storing, retrieving and processing data notwithstanding.

Internal reporting systems: All enterprises which have been in operation for any period of time nave a wealth of information. However, this information often remains under-utilized because it is compartmentalized, either in the form of an individual entrepreneur or in the functional departments of larger businesses. That is, information is usually categorized according to its nature so that there are, for example, financial, production, manpower, marketing, stockholding and logistical data. Often the entrepreneurs, or various personnel working in the functional departments holding these pieces of data, do not see how it could help decision makers in other functional areas. Similarly, decision makers can fail to appreciate how information from other functional areas might help them and therefore do not request it.

The internal records that are of immediate value to marketing decisions are: orders received, stockholdings and sales invoices. These are but a few of the internal records that can be used by marketing managers, but even this small set of records is capable of generating a great deal of information. Below, is a list of some of the information that can be derived from sales invoices.

· Product type, size and pack type by territory

By comparing orders received with invoices an enterprise can establish the extent to which it is providing an acceptable level of customer service. In the same way, comparing stockholding records with orders received helps an enterprise ascertain whether its stocks are in line with current demand patterns.

Marketing models: Within the MIS there has to be the means of interpreting information in order to give direction to decision. These models may be computerized or may not. Typical tools are:

· Time series sales modes

These and similar mathematical, statistical, econometric and financial models are the analytical subsystem of the MIS. A relatively modest investment in a desktop computer is enough to allow an enterprise to automate the analysis of its data. Some of the models used are stochastic, i.e. those containing a probabilistic element whereas others are deterministic models where chance plays no part. Brand switching models are stochastic since these express brand choices in probabilities whereas linear programming is deterministic in that the relationships between variables are expressed in exact mathematical terms.

Chapter Summary

Marketing information systems are intended to support management decision making. Management has five distinct functions and each requires support from an MIS. These are: planning, organizing, coordinating, decisions and controlling.

Information systems have to be designed to meet the way in which managers tend to work. Research suggests that a manager continually addresses a large variety of tasks and is able to spend relatively brief periods on each of these. Given the nature of the work, managers tend to rely upon information that is timely and verbal (because this can be assimilated quickly), even if this is likely to be less accurate then more formal and complex information systems.

Managers play at least three separate roles: interpersonal, informational and decisional. MIS, in electronic form or otherwise, can support these roles in varying degrees. MIS has less to contribute in the case of a manager's informational role than for the other two.

Three levels of decision making can be distinguished from one another: strategic, control (or tactical) and operational. Again, MIS has to support each level. Strategic decisions are characteristically one-off situations. Strategic decisions have implications for changing the structure of an organization and therefore the MIS must provide information which is precise and accurate. Control decisions deal with broad policy issues and operational decisions concern the management of the organization’s marketing mix.

A marketing information system has four components: the internal reporting system, the marketing research systems, the marketing intelligence system and marketing models. Internal reports include orders received, inventory records and sales invoices. Marketing research takes the form of purposeful studies either ad hoc or continuous. By contrast, marketing intelligence is less specific in its purposes, is chiefly carried out in an informal manner and by managers themselves rather than by professional marketing researchers.

Marketing Research:

Marketing Research is a systematic and objective study of problems pertaining to the marketing of goods and services. It is not restricted to any particular area of marketing but is applicable to all its phases and aspects.

Market research - limitations

Accurate, up-to-date information obtained by marketing research can be of enormous value to an organization in gaining and/or maintaining its competitive edge. However, there are a number of reasons why, in reality, these potential benefits may not be realized:

Budgetary constraints – gathering and processing data can be very expensive. Many organizations may lack the expertise to conduct extensive surveys to gather primary data, whatever the potential benefits, and also lack the funds to pay specialist market research agencies to gather such data for them.  In these cases, organizations may be forced to rely on data that is less than ‘perfect’ but that can be accessed more cheaply, e.g., from secondary sources

Time constraints – organizations are often forced to balance the need to build up as detailed a picture as possible regarding customer needs etc. against the desire to make decisions as quickly as possible, in order to maintain or improve their position in the market

Reliability of the data – the value of any research findings depend critically on the accuracy of the data collected.  Data quality can be compromised via a number of potential routes, e.g., leading questions, unrepresentative samples, biased interviewers etc.  Efforts to ensure that data is accurate, samples are representative and interviewers are objective will all add to the costs of the research but such costs are necessary if poor decisions and expensive mistakes are to be avoided.

Legal & ethical constraints – the Data Protection Act (1998) is a good example of a law that has a number of implications for market researchers collecting and holding personal data.  For instance, researchers must ensure that the data they obtain is kept secure, is only used for lawful purposes and is only kept for as long as it is necessary.  It must be made clear as to why data is being collected and the consent of participants must be obtained. In addition to this, there are a number of guidelines, laid down by such organizations as the Market Research Society, that, although not legally binding, encourage organizations to behave ethically when dealing with members of the public.

Marketing Research Process:

Stage 1: Formulating the Research Problem

Formulating a problem is the first step in the research process. In many ways, research starts with a problem that management is facing. This problem needs to be understood, the cause diagnosed, and solutions developed.

However, most management problems are not always easy to research. A management problem must first be translated into a research problem. Once you approach the problem from a research angle, you can find a solution. For example, “sales are not growing” is a management problem.

Translated into a research problem, we may examine the expectations and experiences of several groups: potential customers, first-time buyers, and repeat purchasers. We will determine if the lack of sales is due to:

What then is the difference between a management problem and a research problem? Management problems focus on an action. Do we advertise more? Do we change our advertising message? Do we change an under-performing product configuration?

If so, how?

Research problems, on the other hand, focus on providing the information you need in order to solve the management problem.

Stage 2: Method of Inquiry

The scientific method is the standard pattern for investigation. It provides an opportunity for you to use existing knowledge as a starting point and proceed impartially.

The scientific method includes the following steps:

The terminology is similar to the stages in the research process. However, there are subtle differences in the way the steps are performed. For example, the scientific method is objective while the research process can be subjective.

Objective-based research (quantitative research) relies on impartial analysis.

The facts are the priority in objective research. On the other hand, subjective-based research (qualitative research) emphasizes personal judgment as you collect and analyze data.

Stage 3: Research Method

In addition to selecting a method of inquiry (objective or subjective), you must select a research method.

There are two primary methodologies that can be used to answer any research question: experimental research and non-experimental research.

Experimental research gives you the advantage of controlling extraneous variables and manipulating one or more variables that influences the process being implemented. Non-experimental research allows observation but not intervention.

You simply observe and report on your findings.

Stage 4: Research Design

The research design is a plan or framework for conducting the study and collecting data. It is defined as the specific methods and procedures you use to acquire the information you need.

Descriptive Research Design

The focus of descriptive research is to provide an accurate description for something that is occurring. For example, what age group is buying a particular brand, a product’s market share within a certain industry, how many competitors a company faces, etc. This type of research is by far the most popular form of market research. It is used extensively when the research purpose is to explain, monitor and test hypotheses, and can also be used to a lesser extent to help make predictions and for discovery.

Marketers routinely conduct basic descriptive research using informal means. For instance, the head of marketing for a clothing company may email a retailer to see how the products are selling. But informal descriptive research, while widely undertaken, often fails to meet the tests of research validity and reliability and, consequently, the information should not be used as an important component in marketing decisions. Rather, to be useful, descriptive research must be conducted in a way that adheres to a strict set of research requirements to capture relevant results. This often means that care must be taken to develop a structured research plan. Under most circumstances this requires researchers have a good grasp of research methods including knowledge of data analysis.

Exploratory Research Design:

The exploratory approach attempts to discover general information about a topic that is not well understood by the marketer. For instance, a marketer has heard news reports about a new Internet technology that is helping competitors but the marketer is not familiar with the technology and needs to do research to learn more. When gaining insight (i.e., discovery) on an issue is the primary goal, exploratory research is used.

The basic difference between exploratory and descriptive research is the research design. Exploratory research follows a format that is less structured and more flexible than descriptive research. This approach works well when the marketer doesn’t have an understanding of the topic or the topic is new and it is hard to pinpoint the research direction. The downside, however, is that results may not be as useful in aiding a marketing decision. So why use this method? In addition to offering the marketer basic information on a topic, exploratory research may also provide direction for a more formal research effort. For instance, exploratory research may indicate who the key decision makers are in a particular market thus enabling a more structured descriptive study targeted to this group.

Causal Research Design

In this form of research the marketer tries to determine if the manipulation of one variable, called the independent variable, affects another variable, called the dependent variable. In essence, the marketer is conducting an experiment. To be effective the design of causal research is highly structured and controlled so that other factors do not affect those being studied.

Marketers use this approach primarily for purposes of prediction and to test hypotheses, though it can also be used to a lesser extent for discovery and explanatory purposes. In marketing, causal research is used for many types of research including testing marketing scenarios, such as what might happen to product sales if changes are made to a product’s design or if advertising is changed. If causal research is performed well marketers may be able to use results for forecasting what might happen if the changes are made.

Stage 5: Data Collection Techniques

Your research design will develop as you select techniques to use. There are many ways to collect data. Two important methods to consider are interviews and observation.

Common modes of research communication include interviews conducted face-to-face, by mail, by telephone, by email, or over the Internet. This broad category of research techniques is known as survey research.

These techniques are used in both non-experimental research and experimental research.

Another way to collect data is by observation. Observing a person’s or company’s past or present behavior can predict future purchasing decisions. Data collection techniques for past behavior can include analyzing company records and reviewing studies published by external sources.

In order to analyze information from interview or observation techniques, you must record your results. Because the recorded results are vital, measurement and development are closely linked to which data collection techniques you decide on.

The way you record the data changes depends on which method you use.

Stage 6: Sample Design

Your marketing research project will rarely examine an entire population. It’s more practical to use a sample—a smaller but accurate representation of the greater population. In order to design your sample, you must find answers to these questions:

Once you’ve established who the relevant population is (completed in the problem formulation stage), you have a base for your sample. This will allow you to make inferences about a larger population. There are two methods of selecting a sample from a population: probability or non-probability sampling.

The probability method relies on a random sampling of everyone within the larger population.

Non- probability is based in part on the judgment of the investigator, and often employs convenience samples, or by other sampling methods that do not rely on probability.

The final stage of the sample design involves determining the appropriate sample size. This important step involves cost and accuracy decisions. Larger samples generally reduce sampling error and increase accuracy, but also increase costs.

Stage 7: Data Collection

Once you’ve established the first six stages, you can move on to data collection.

Depending on the mode of data collection, this part of the process can require large amounts of personnel and a significant portion of your budget. Personal (face-to-face) and telephone interviews may require you to use a data collection agency (field service).

Internet surveys require fewer personnel, are lower cost, and can be completed in days rather than weeks or months.

Regardless of the mode of data collection, the data collection process introduces another essential element to your research project: the importance of clear and constant communication.

Stage 8:  Data Analysis and Interpretation

In order for data to be useful, you must analyze it.

Analysis techniques vary and their effectiveness depends on the types of information you are collecting, and the type of measurements you are using. Because they are dependent on the data collection, analysis techniques should be decided before this step.

Stage 9: The Research Report

The research process culminates with the research report.

This report will include all of your information, including an accurate description of your research process, the results, conclusions, and recommended courses of action. The report should provide all the information the decision maker needs to understand the project.

It should also be written in language that is easy to understand. It’s important to find a balance between completeness and conciseness. You don’t want to leave any information out; however, you can’t let the information get so technical that it overwhelms the reading audience.

One approach to resolving this conflict is to prepare two reports: the technical report and the summary report. The technical report discusses the methods and the underlying assumptions. In this document, you discuss the detailed findings of the research project.

The summary report, as its name implies, summarizes the research process and presents the findings and conclusions as simply as possible.

Another way to keep your findings clear is to prepare several different representations of your findings. PowerPoint presentations, graphs, and face-to-face reports are all common methods for presenting your information.

Along with the written report for reference, these alternative presentations will allow the decision maker to understand all aspects of the project.

Advantages of marketing research

· It indicates opportunities for products and market development, a company can then decide on the production, sales and production plans after identifying the opportunities.

1) Will help you better communicate.

2) Will help identify opportunities.

3) Will minimize risk.

4) Will create benchmarks to help you measure progress.

Problems associated with marketing research

Lack of cash

Haste

Inappropriate methodology

Inexperience in data analysis

Wrong information

Seasonality

The Purpose of Market Research

There's not that much competition online. I know this is a bold statement and I am going to prove it to you in a step-by-step fashion.

If you don't research a market before diving into it you're crazy. You will waste an incredible amount of time, money and metal resources if you jump into a market blindly without following a process to:

Five Basic Methods of Market Research

While there are many ways to perform market research, most businesses use one or more of five basic methods: surveys, focus groups, personal interviews, observation, and field trials. The type of data you need and how much money you’re willing to spend will determine which techniques you choose for your business.

1. Surveys. With concise and straightforward questionnaires, you can analyze a sample group that represents your target market. The larger the sample, the more reliable your results will be.

2. Focus groups. In focus groups, a moderator uses a scripted series of questions or topics to lead a discussion among a group of people. These sessions take place at neutral locations, usually at facilities with videotaping equipment and an observation room with one-way mirrors. A focus group usually lasts one to two hours, and it takes at least three groups to get balanced results.

3. Personal interviews. Like focus groups, personal interviews include unstructured, open-ended questions. They usually last for about an hour and are typically recorded.

Focus groups and personal interviews provide more subjective data than surveys. The results are not statistically reliable, which means that they usually don't represent a large enough segment of the population. Nevertheless, focus groups and interviews yield valuable insights into customer attitudes and are excellent ways to uncover issues related to new products or service development.

4. Observation. Individual responses to surveys and focus groups are sometimes at odds with people's actual behavior. When you observe consumers in action by videotaping them in stores, at work, or at home, you can observe how they buy or use a product. This gives you a more accurate picture of customers' usage habits and shopping patterns.

5. Field trials. Placing a new product in selected stores to test customer response under real-life selling conditions can help you make product modifications, adjust prices, or improve packaging. Small business owners should try to establish rapport with local store owners and Web sites that can help them test their products.

STRATEGIC MARKETING PLANNING

What is Marketing?

To be successful, an organization must constantly try to match its own capabilities to the needs of its customers both current and potential as well as all of its stakeholders.

Over the years marketing has been defined in many ways:

“Marketing is the management process which identifies, anticipates and supplies customer re-quirements”

Malcolm McDonald

“A coordinated process which makes the best use of available resources to present a product proposition to a target market in order to achieve objectives, and then evaluating how successfully this has been done”.

Peter Verwey, TMA Marketing Manual

“We live in an age when methods of communication are changing more rapidly than ever be-fore….a time when the traditional arts must work harder than ever to secure their audience and when the emerging arts must think imaginatively to develop the crucial relationship between art and audience.

That relationship is never static. Audiences can-not be taken for granted….The wider audience is out there—it is up to us to tempt them in”.

Andrew Motion, Poet Laureate.

The true challenge of marketing and audience development is planning strategically in a way which will ensure that the plan that emerges is realistic to the needs, wants and resources you have to hand as an individual or an organization. An unrealistic marketing strategy or plan is not worth the paper it is written on.

What is Strategy?

There is an inherent problem of defining strategy: strategy means different things to different people.

“There is no single, universally accepted definition".

Mintzberg & Quinn (1991)

The Roots of strategy come from- Ancient Greek military usage ‘strategies’:

Initially it was a role - the general in command of an army. Later strategy became "the art of the general".

By the time of Percales (450 BC) it had become a recognized "managerial skill";

By the time of Alexander (300 BC) strategy was:

"The skill of employing forces to overcome opposition and create a unified system of global governance"

Evered (1980)

Modern business usage i.e. ‘Corporate’ Strategy has become a metaphorical extension of the an-cient & modern (military concept).

There are many comparative definitions of strategy, here are just a few:

"(Strategy) is the determination of the basic long-term goals and objectives of an enterprise, and the adoption of the courses of action and the allocation of resources necessary for carrying out those goals."

Chandler, A.D (1962)

Business historian Chandler subscribes to the view that strategy is as much about defining goals and objectives as it is about providing the means for achieving them.

Kenneth Andrews (1987) distinguishes between corporate strategy which is the lead strategy, and business strategy, a secondary, yet vital, aspect of corporate strategy:

"...a pattern of decisions ... (which represent) .

The unity, coherence and internal constituency of a company's strategic decisions that position a company in its environment and give the firm its identity, its power to mobilize its strengths, and its likelihood of success in the marketplace."

By comparison, Ansoff and McDonnell (1990), separate strategy (concerned with means) from goal-setting (concerned with ends). They define strategic management as:

"a systematic approach for managing strategic change which consists of the following:

1.    positioning of the firm through strategy and capability planning;

2.  real-time strategic response through issue management;

3.  Systematic management of resistance during strategic implementation."

Cole, (1997) proposes a working definition of strategic management to be:

"a process, directed by top management, to deter-mine the fundamental aims or goals of the organisation, and ensure a range of decisions which will allow for the achievement of those aims or goals in the long-term, whilst providing for adaptive responses in the short term."

Definitions of strategy fall into five categories with differing areas of emphasis:

 A plan: “a consciously intended course of action”.

◆      A ploy: “a man oeuvre intended to outwit a competitor”.

◆      A pattern: underpinning “a stream of actions”.

◆      A position: a deliberate stance taken in relation to the environment.

◆      A perspective: an all embracing way of thinking about the organization and its approach to the world.

Most ‘strategies’ mix elements of the five aspects at one and the same time.

Strategic Marketing Management

◆      The management of the process of making strategy and of making strategy happens.

◆      "a systematic approach to a major and increasingly important responsibility of management: to position and relate the firm to its environment in a way which assures its success and makes it secure from surprises"

Ansoff & McDonnell (1990).

◆      Underlying purpose: to maintain fit or alignment between the organization’s activities and its operating environment

◆      Staying in fit means managing the organization so as to stay aligned with changes in the surrounding world.

Strategic marketing management’s primary focus is that of ensuring that an organization’s marketing operations and activities align with its environment, both external and internal.

Strategy—Some Distinguishing Qualities

What business is it in?

How does this find practical expression? (i.e. concentration vs. diversity)

-          Usually complex & multi-disciplined in content

The need for strategic marketing management and planning in the arts:

There is a defined need for all organizations and individuals involved with the arts to become strategic in the management of all their operations including marketing, this stems from:

1. The ‘new’ political stance on the role of subsidy and the rise in market forces, which in turn means that for arts organizations, there is:

a) An increased emphasis on earned income.

b) An increased accountability for, and effectiveness in, the use of scant resources.

2. The growing need to balance the artistic urge with the financial imperative and also with socially inclusive government policy.

The logic for this model of strategic management is as follows:

1. The overall purpose, or mission, of the organization is defined; such a task will be undertaken only infrequently.

2. The fundamental long-term aims and goals of the organization are agreed (i.e. the ‘core business’); these aims/goals way be changed, or added to, from time to time.

3. Mechanisms are established to ensure that the strategic thinking process does take place; these will include data collection mechanisms and consultation arrangements as well as decision making meeting; the key investigations at this stage will relate to the organization’s position in its market and especially to its competitive situation.

4. The key product-market, resourcing, quality and other major decisions are agreed by the senior management.

5. Appropriate organizational structures are put in place to ensure that strategic decisions are promulgated throughout the organization and implemented in accordance with agreed policies.

6. Results are reviewed and appropriate changes made as necessary to aims/ goals and objectives, which completes the cycle

Marketing Plans and Planning

A marketing plan has been defined as: “A written statement of the marketing aims of a company, including a statement of the products, targets for sales, market shares and profits, promotional and advertising strategies, pricing policies, distribution channels etc. with precise specification of timescales, individual responsibilities etc”. (Masner, 1988)

To achieve this marketing plan, the organization will have to go through a number of stages which take the form of questions, as follows:

· Where are we now? - The analysis of the current marketing situation.

· Where do we want to be in the future? - setting the objectives.

· How are we going to get there? – creating the strategy

· How will we know when we get there? - Monitoring and evaluation

The Marketing Planning Process

Strategic Marketing Planning takes time, but is well worth the effort the process can be split into four clearly defined areas, it is useful to think of the effective marketing process as a triangle. The more time spent at the beginning on the foundations of the strategy, the analysis and planning stages, the stronger the top of the triangle, the communications and action that ensue.

This can be further broken down into defined actions: 

The marketing plan is achieved at the end of the planning process and should be a short, working, summary document of all the environment analysis which precedes it. The methodology for undertaking this ’backbone’ of analysis is examined later in this guide.

Format of a typical marketing plan

1. INTRODUCTION

2. OBJECTIVES—Company mission statement. Aim = the ends, Objectives = the means.

3. PRODUCT / SERVICE MARKET BACKGROUND—

Present market overview (marketing audit). Sales summary, market research and analysis.

4. SWOT / PEST ANALYSIS—company SWOT and competitor SWOT. SWOT analysis is sometimes presented as a situational analysis (of where would we like to be in the future?).

6. MARKETING STRATEGY—target market segments, basis of competition USP (unique selling point). Detailed plan of action, tasks, measurable outputs with timescales and responsibilities.

7. MARKETING MIX—promotional objectives, promotional plan and budget / costs. Pricing strategies and distribution arrangements.

8. STATEMENT OF EXPECTED SALES—sales forecasts for each target market.

9. CONTROL AND EVALUATION—a statement of action necessary if things are going out of control. It is possible to evaluate results for each market/ product sector under the following:

· Weekly flow of bookings

· Sales response to advertising

· Market analysis on the response and perception of advertising and promotional campaigns

· Sales response to any price discounts

· Customer satisfaction with product quality measured by surveys, focus groups etc.

The communications role

This relates very much to the role of the marketing manager and his or her skill at conveying a message. Ways of involving as many staff as possible in contributing to the process of setting objectives and drawing up plans, is an important aspect of securing willing, enthusiastic participation in their implementation. Poor communication can result in de-motivated staff that is unwilling to help achieve desired objectives.

The benefits of marketing planning

The benefits of marketing planning can be both at the organizational level and individual level. Marketing planning takes place within the context of the aims and objectives of the whole organization. It can help to clarify them; reinforcing the artistic policy and providing a sense of direction and purpose to the activities in which arts organizations and individuals are engaged. When the organization is clear about what it is and where it is going, audiences too will be more certain as to the organization’s role and position, reducing the likelihood of disappointed expectations.

The model of the Five Competitive Forces was developed by Michael E. Porter in his book „Competitive Strategy: Techniques for Analyzing Industries and Competitors“ in 1980. Since that time it has become an important tool for analyzing an organizations industry structure in strategic processes.

Porter’s model is based on the insight that a corporate strategy should meet the opportunities and threats in the organizations external environment. Especially, competitive strategy should base on and understanding of industry structures and the way they change.

Porter has identified five competitive forces that shape every industry and every market. These forces determine the intensity of competition and hence the profitability and attractiveness of an industry. The objective of corporate strategy should be to modify these competitive forces in a way that improves the position of the organization. Porters model supports analysis of the driving forces in an industry. Based on the information derived from the Five Forces Analysis, management can decide how to influence or to exploit particular characteristics of their industry.

The term 'suppliers' comprises all sources for inputs that are needed in order to provide goods or services.

Supplier bargaining power is likely to be high when:

       The market is dominated by a few large suppliers rather than a fragmented source of supply,

       There are no substitutes for the particular input,

       The suppliers customers are fragmented, so their bargaining power is low,

       The switching costs from one supplier to another are high,

       There is the possibility of the supplier integrating forwards in order to obtain higher prices and margins. This threat is especially high when

       The buying industry has a higher profitability than the supplying industry,

       Forward integration provides economies of scale for the supplier,

       The buying industry hinders the supplying industry in their development (e.g. reluctance to accept new releases of products),

       The buying industry has low barriers to entry.

In such situations, the buying industry often faces a high pressure on margins from their suppliers. The relationship to powerful suppliers can potentially reduce strategic options for the organization.

Similarly, the bargaining power of customers determines how much customers can impose pressure on margins and volumes.

Customers bargaining power is likely to be high when

       They buy large volumes, there is a concentration of buyers,

       The supplying industry comprises a large number of small operators

       The supplying industry operates with high fixed costs,

       The product is undifferentiated and can be replaces by substitutes,

       Switching to an alternative product is relatively simple and is not related to high costs,

       Customers have low margins and are price-sensitive,

       Customers could produce the product themselves,

       The product is not of strategical importance for the customer,

       The customer knows about the production costs of the product

       There is the possibility for the customer integrating backwards.

The competition in an industry will be the higher, the easier it is for other companies to enter this industry. In such a situation, new entrants could change major determinants of the market environment (e.g. market shares, prices, customer loyalty) at any time. There is always a latent pressure for reaction and adjustment for existing players in this industry.

The threat of new entries will depend on the extent to which there are barriers to entry. These are typically

       Economies of scale (minimum size requirements for profitable operations),

       High initial investments and fixed costs,

       Cost advantages of existing players due to experience curve effects of operation with fully depreciated assets,

       Brand loyalty of customers

       Protected intellectual property like patents, licenses etc,

       Scarcity of important resources, e.g. qualified expert staff

       Access to raw materials is controlled by existing players,

       Distribution channels are controlled by existing players,

       Existing players have close customer relations, e.g. from long-term service contracts,

       High switching costs for customers

       Legislation and government action

A threat from substitutes exists if there are alternative products with lower prices of better performance parameters for the same purpose. They could potentially attract a significant proportion of market volume and hence reduce the potential sales volume for existing players. This category also relates to complementary products.

Similarly to the threat of new entrants, the treat of substitutes is determined by factors like

       Brand loyalty of customers,

       Close customer relationships,

       Switching costs for customers,

       The relative price for performance of substitutes,

       Current trends.

This force describes the intensity of competition between existing players (companies) in an industry. High competitive pressure results in pressure on prices, margins, and hence, on profitability for every single company in the industry.

Competition between existing players is likely to be high when

       There are many players of about the same size,

       Players have similar strategies

       There is not much differentiation between players and their products, hence, there is much price competition

       Low market growth rates (growth of a particular company is possible only at the expense of a competitor),

       Barriers for exit are high (e.g. expensive and highly specialized equipment).

Five Forces Analysis can provide valuable information for three aspects of corporate planning:

Statical Analysis:

The Five Forces Analysis allows determining the attractiveness of an industry. It provides insights on profitability. Thus, it supports decisions about entry to or exit from and industry or a market segment. Moreover, the model can be used to compare the impact of competitive forces on the own organization with their impact on competitors. Competitors may have different options to react to changes in competitive forces from their different resources and competences. This may influence the structure of the whole industry.

Dynamical Analysis:

In combination with a PEST-Analysis, which reveals drivers for change in an industry, Five Forces Analysis can reveal insights about the potential future attractiveness of the industry. Expected political, economical, socio-demographical and technological changes can influence the five competitive forces and thus have impact on industry structures.

Useful tools to determine potential changes of competitive forces are scenarios.

Analysis of Options:

With the knowledge about intensity and power of competitive forces, organizations can develop options to influence them in a way that improves their own competitive position. The result could be a new strategic direction, e.g. a new positioning, differentiation for competitive products of strategic partnerships (see section 4).

Thus, Porters model of Five Competitive Forces allows a systematic and structured analysis of market structure and competitive situation. The model can be applied to particular companies, market segments, industries or regions. Therefore, it is necessary to determine the scope of the market to be analyzed in a first step. Following, all relevant forces for this market are identified and analyzed. Hence, it is not necessary to analyze all elements of all competitive forces with the same depth.

The Five Forces Model is based on microeconomics. It takes into account supply and demand, complementary products and substitutes, the relationship between volume of production and cost of production, and market structures like monopoly, oligopoly or perfect competition.

After the analysis of current and potential future state of the five competitive forces, managers can search for options to influence these forces in their organization’s interest. Although industry-specific business models will limit options, the own strategy can change the impact of competitive forces on the organization. The objective is to reduce the power of competitive forces.

The following figure provides some examples. They are of general nature. Hence, they have to be adjusted to each organization’s specific situation. The options of an organization are determined not only by the external market environment, but also by its own internal resources, competences and objectives.

5           Critique

Porter’s model of Five Competitive Forces has been subject of much critique. Its main weakness results from the historical context in which it was developed. In the early eighties, cyclical growth characterized the global economy. Thus, primary corporate objectives consisted of profitability and survival. A major prerequisite for achieving these objectives has been optimization of strategy in relation to the external environment. At that time, development in most industries has been fairly stable and predictable, compared with today’s dynamics.

In general, the meaningfulness of this model is reduced by the following factors:

       In the economic sense, the model assumes a classic perfect market. The more an industry is regulated, the less meaningful insights the model can deliver.

       The model is best applicable for analysis of simple market structures. A comprehensive description and analysis of all five forces gets very difficult in complex industries with multiple interrelations, product groups, by-products and segments. A too narrow focus on particular segments of such industries, however, bears the risk of missing important elements.

       The model assumes relatively static market structures. This is hardly the case in today’s dynamic markets. Technological breakthroughs and dynamic market entrants from start-ups or other industries may completely change business models, entry barriers and relationships along the supply chain within short times. The Five Forces model may have some use for later analysis of the new situation; but it will hardly provide much meaningful advice for preventive actions.

       The model is based on the idea of competition. It assumes that companies try to achieve competitive advantages over other players in the markets as well as over suppliers or customers. With this focus, it dos not really take into consideration strategies like strategic alliances, electronic linking of information systems of all companies along a value chain, virtual enterprise-networks or others.

 Overall, Porters Five Forces Model has some major limitations in today’s market environment. It is not able to take into account new business models and the dynamics of markets. The value of Porters model is more that it enables managers to think about the current situation of their industry in a structured, easy-to-understand way – as a starting point for further analysis.

Porter’s value chain model

The Value Chain

A methodology of separating a business system into a series of value-generating activities that develop competitive advantage.

Michael Porter introduced a generic value chain model that comprises a sequence of activities found to be common to a wide range of firms.

Goal - offer the customer a level of value that exceeds the cost of the activities, resulting in a profit margin.

Primary Value Chain Activities:

·         Inbound Logistics:

o    The receiving and warehousing of raw materials and their distribution to manufacturing as they are required.

·         Operations:

o    The processes of transforming inputs into finished products and services.

·         Outbound Logistics:

o    The warehousing and distribution of finished goods.

·         Marketing & Sales:

o    The identification of customer needs and the generation of sales.

·         Service:

o    The support of customers after the products and services are sold to them.

Supporting Activities:

·         Infrastructure of the firm:

o   Organizational structure, control systems, company culture, etc.

·         Human resource management:

o   Employee recruiting, hiring, training, development and compensation.

·         Technology development:

o   Technologies to support value-creating activities.

·         Procurement:

o   Purchasing inputs such as materials, supplies, and equipment.

Profit Margin:

Depends on the Effectiveness in performing these Supporting Activities “Efficiently”

-Revenues (customer is willing to pay for the products) must exceed the cost of the activities in the value chain.

Generate Superior Value:

A competitive advantage may be achieved by reconfiguring the value chain to provide lower cost or better differentiation.

Use the value chain model to define a firm's core competencies and the activities in which it can pursue a competitive advantage:

·         Cost advantage: Better understanding and reducing costs

·         Differentiation: Focus on those activities associated with core competencies and capabilities

Cost Advantage and the Value Chain

1- Reduce the cost of individual value chain activities

2- Reconfigure the value chain.

A- Define the value chain is define via a cost analysis, by assigning costs to the value chain activities.

B- Accounting reports are studied in order to modify or reallocate costs and produce value creating activities.

1- Reduce the cost of individual value chain activities

Porter identified 10 cost drivers related to value chain activities:

• Economies of scale
• Learning
• Capacity utilization
• Linkages among activities
• Interrelationships among business units
• Degree of vertical integration
• Timing of market entry
• Firm's policy of cost or differentiation
• Geographic location
• Institutional factors (regulation, union activity, taxes, etc.)

NOTE:

1- A firm develops a cost advantage by controlling these drivers better than do the competitors.

2- Reconfigure the value chain.

Structural changes - such a new production process, new distribution channels, or a different sales approach.

 

Differentiation and the Value Chain

Increase Uniqueness- Changing any part of the value chain.

-          procurement of inputs that are unique

-          distribution channels that offer high service levels

Porter identified several drivers of uniqueness:

• Policies and decisions
• Linkages among activities
• Timing
• Location
• Interrelationships
• Learning
• Integration
• Scale (e.g. better service as a result of large scale)
• Institutional factors

Reconfiguring value chain for uniqueness.

-          Forward integrate - perform functions that once were performed by customers.

-          Backward integrate- have more control over its inputs.

-          Implement new process technologies or utilize new distribution channels.

-          Develop a novel value chain configuration that increases product differentiation.

Technology and the Value Chain

Can impact competitive advantage by incrementally changing the activities themselves or by making possible new configurations of the value chain. To the extent that these technologies affect cost drivers or uniqueness, they can lead to a competitive advantage.

Used in both primary value activities and support activities:

•     Inbound Logistics Technologies
• Transportation
• Material handling
• Material storage
• Communications
• Testing
• Information systems
•     Operations Technologies
•   Process
•    Materials
•    Machine tools
•    Material handling
• Packaging
• Maintenance
• Testing
• Building design & operation
• Information systems
•     Outbound Logistics Technologies
•    Transportation
•    Material handling
•    Packaging
•    Communications
•     Information systems
•     Marketing & Sales Technologies
•     Media
•    Audio/video
•     Communications
•     Information systems
• Service Technologies
•    Testing
•    Communications
•     Information systems

Linkages between Value Chain Activities

One value chain activity often affects the cost or performance of other ones.

Ex1. Design of a product is changed in order to reduce manufacturing costs, results in increased service costs

Ex2. Design change simultaneously reduces manufacturing costs and improves reliability so that the service costs also are reduced

Value Chain analysis for Horizontal Strategy:

Goal- Cost Reduction via synergy; using value change analysis to identify Business Unit Interrelationships identification of synergy among business units.

Ex.  If multiple business units require a particular raw material, sharing of the procurement activity can result in cost reduction.

Caveat:  The cost of coordination and the cost of reduced flexibility

Outsourcing Value Chain Activities

Using value change analysis to identify activities to outsource.

Goal- Cost Reduction via outsourcing;

Analysis of firm’s vertical integration (upstream and downstream activities) to uncover specialization potential in one or more value chain activities and outsource others.

Each activity must be studied to understand it’s:

1- Strengths and weaknesses

2- Cost and ability to differentiate.

Factors to consider when selecting activities to outsource:

·         Whether the activity can be performed cheaper or better by suppliers.

·         Whether the activity is one of the firm's core competencies from which stems a cost advantage or product differentiation.

·         The risk of performing the activity in-house. If the activity relies on fast-changing technology or the product is sold in a rapidly-changing market, it may be advantageous to outsource the activity in order to maintain flexibility and avoid the risk of investing in specialized assets.

·         Whether the outsourcing of an activity can result in business process improvements such as reduced lead time, higher flexibility, reduced inventory.

MARKET SEGMENTATION

Target marketing Strategies:  

Mass Market- The term mass market refers to a large, undifferentiated market of consumers with widely varied backgrounds. Products and services needed by almost every member of society are suited for the mass market. Such items as electric and gas utilities, soap, paper towels and gasoline, for example, can be advertised and sold to almost anyone, making them mass market goods.

Mass Marketing –An attempt to appeal to an entire market with one basic marketing strategy utilizing mass distribution and mass media. Also called undifferentiated marketing. Mass marketing is a market coverage strategy in which a firm decides to ignore market segment differences and go after the whole market with one offer. It is type of marketing (or attempting to sell through persuasion) of a product to a wide range of consumers. The approach results in a single marketing plan with the same mix of product, price, promotion, and place strategies for the entire market. The appeal of mass marketing is in the potential for higher total profits. Companies that employ the system expect the larger profit to result from

 (1) Expanded volume through lower prices and

 (2) Reduced costs through economies of scale made possible by the increased volume. In order for the system to work, however, certain conditions must exist. One is that the product must have broad appeal and a few features that distinguish it from competing products. Another is that it must lend itself to mass production. In addition, the opportunity must exist, and the marketer must have the ability to communicate and distribute to the aggregate market. Two of the most widely recognized examples are Ford and Coca-Cola. Henry Ford applied the concept in the automobile industry. His Model T was conceived and marketed as a "universal" car—one that would meet the needs of all buyers. By adopting mass-production techniques and eliminating optional features, he was able to reduce costs and sell his product at an affordable price. The combination catapulted the Model T to the top of the market. Also Candler was equally successful at using mass marketing in the soft drink industry. Like Ford, he also viewed his product as being the only one that consumers needed. His initial mass-marketing efforts focused on an extensive national advertising campaign. As product recognition grew, he established a network of bottling operations throughout the county to facilitate sales and distribution. No product in history has matched Coca- Cola's total sales. Other mass marketers of this era achieved success by focusing on one aspect of the approach. Manufacturers such as Quaker Oats, Proctor and Gamble, and Eastman Kodak used refined mass-production techniques to establish consistent product quality. Still other manufacturers, such as Singer Sewing Machine, developed integrated distribution systems to ensure reliable delivery to the market. In general merchandise retailing, Sears and Montgomery Ward developed a mass-marketing niche through mail order. Grocery retailer A&P, on the other hand, established its mass market through private branding and systematic operation of multiple stores. Mass marketers continued their domination in major industries well into the 1960s. Many of them maintained essentially the same mix, while others expanded their use of the strategy. Sears and Montgomery Ward, for example, added store retailing in the 1920s. In the 1930s, supermarkets appeared with a different emphasis than previous grocery retailers—national brands. Over the next several decades, large discount stores came into prominence with a format similar to the supermarkets.

Differentiated Marketing- Is a market segmentation and market coverage strategy whereby a product is developed and marketed for a very well-defined, specific segment of the consumer population. The marketing plan will be a highly specialized one catering to the needs of that specific consumer segment. Concentrated marketing is particularly effective for small companies with limited resources because it enables the company to achieve a strong market position in the specific market segment it serves without mass production, mass distribution, or mass advertising. It enables firms to capitalize on the respective serve market share.

Niche Marketing- The strategy of developing a single marketing mix aimed at one target market (niche) is called focused marketing or niche marketing. For example- Marketing and promoting a book to a specific group of buyers, such as people in a certain geographical region, or people with a specific hobby or interest. Books published for a niche market may be sold nationally, but mainly are sold through specialized retail outlets. Here is another example of niche marketing: a brand new print magazine, called Magazine Soho. The publication targets not small business — a broad category to be sure. No, it targets a segment of small business: Soho’s — small office, home office workers and with a particular geographic emphasis on south-eastern Wisconsin, USA.

Customised Marketing- A type of marketing method whereby an advertiser tries to customize the message to the unique needs of a specific customer or specific subset of customers. Custom marketing is usually targeted toward a high net worth niche. A fascinating development in marketing in recent years has been the introduction of mass customization in consumer markets. This is the marketing of highly individual products on scale. Car companies like Audi, BMW, Mercedes Benz and Renault have the capacity to build to order where cars are manufactured only when there is an order specification from a customer. Dell builds customized computers ordered online.

    Market segmentation      

What is Segmentation?

Segmentation refers to a process of bifurcating or dividing a large unit into various small units which have more or less similar or related characteristics.

Market Segmentation

§ Market segmentation is a marketing concept which divides the complete market set up into smaller subsets comprising of consumers with a similar taste, demand and preference.

§ A market segment is a small unit within a large market comprising of like minded individuals.

§ One market segment is totally distinct from the other segment.

§ A market segment comprises of individuals who think on the same lines and have similar interests.

§ The individuals from the same segment respond in a similar way to the fluctuations in the market.

  Today the market is not a single homogenous group. Mass markets are breaking up into dozens of mini markets each with its own special needs .This is known as segmentation. It involves using separate marketing programs to sell to different market segments.

Definition:-

1. Market Segmentation is the sub-dividing of customers into homogenous sub-set of customers where any sub-set may conceivably selected as market target to be reached with distinct Marketing Mix – Philip Kotler

2. Market Segmentation consists of taking the total heterogeneous market for a product & dividing into several sub-markets of segments, each of which tends to be homogenous in full significant aspects – William Stanton

3. Segmentation is essentially the identification of subsets of buyers within a market that share similar needs and demonstrate similar buyer behavior. The world is made up of billions of buyers with their own sets of needs and behavior. Segmentation aims to match groups of purchasers with the same set of needs and buyer behavior. Such a group is known as a 'segment'.

4.The process of defining and subdividing a large homogenous market into clearly identifiable segments having similar needs, wants, or demand characteristics is called Segmentation. Its objective is to design a marketing mix that precisely matches the expectations of customers in the targeted segment.

5. Market Segmentation is the marketing process of identifying and breaking up the total market into groups of potential customers with similar motivations, needs or characteristics, who are likely to exhibit homogeneous purchase behavior. Undertaking this process allows marketing efforts to be targeted at select groups.

6. Market segmentation involves the subdividing of a market into distinct subgroups of customers, where any subgroup can be selected as a target market to be met with a distinct marketing mix. - CIMA

7. Market segmentation is a technique based on the recognition that every market consists of potential buyers with different needs and different buying behavior. These different customer characteristics may be sub grouped­­ (or segmented) and a different marketing mix applied by an organization to each target market segment. – CIMA

­­­

8. A marketing term referring to the aggregating of prospective buyers into groups (segments) that have common needs and will respond similarly to a marketing action. Market segmentation enables companies to target different categories of consumers who perceive the full value of certain products and services differently from one another.

9. Market Segmentation is the process of splitting customers, or potential customers, in a market into different groups, or segments, within which customers share a similar level of interest in the same or comparable set of needs satisfied by a distinct marketing proposition.

10.  Market segmentation is the process of dividing the whole market of a good or service in groups of people with similar needs. By making this division there is a high chance that each group responds in favor to a specific market strategy.

Segmentation is a form of critical evaluation rather than a prescribed process or system, and

hence no two markets are defined and segmented in the same way. However there are a number of underpinning criteria that assist us with segmentation:

·  Is the segment viable? Can we make a profit from it?

·  Is the segment accessible? How easy is it for us to get into the segment?

·  Is the segment measurable? Can we obtain realistic data to consider its potential?

There are many ways that a segment can be considered. For example, the auto market could be segmented by: driver age, engine size, model type, cost, and so on.

WHY SEGMENTATION?

According to the Peter Francese a consultant to Ogilvy & Mather an advertising megalith & the author of the research report 2010 America –

“There is no more ‘Average American’." Fifty years ago, the concept of John Doe, an average American in a relatively even society where vast numbers of people had similar consumer needs, was real. A societal uniformity existed that has not been equaled since. The 2010 census results will put a nail in that coffin.

America, or for that matter most of the developed countries, are multicultural nations. In the US no race or ethnicity comprises a majority of the population anymore. No segment forms a majority in their 10 largest cities. Also family life has diversified. Twenty five years earlier, two-thirds of the population consisted of married couples. However same is not the case today, as more & more no. of people prefers living alone.”

All this has resulted in a diverse population which makes it almost impossible to sell a product by mass marketing .The right market for your product needs to be selected before making any other move.

Choosing the right markets is one of the most important strategic decisions you can make for your business. Resources spent on choosing the wrong markets are resources not spent on choosing the right markets.

Grouping customers into market segments is standard business practice. The more a market suffers from over supply and under demand - the new status quo in a relentlessly globalizing economy for both hi tech and low tech goods and services – the more vital it becomes to identify, and perhaps help create attractive sub markets and provide tailor value propositions for them. That is what apple has done with the iPod and iTunes under Steve Jobs leadership. The iPod and iTunes have not only boosted Apples bottom line, and quite separately increased the sales of its Macintosh computers, but have also accelerated the growth of the mp3 player market as a whole.

Segmentation is both a science and an art. It demands a high degree of insight into customers and competitors. You cannot do it well using only methods based on simple demographics. How, for example, would you segment the dog food market? You might start of, as some have done, on the basis of type of dog – old dogs versus small dogs, big dogs versus little dogs. But think how much greater insight you might gain from examining the relationship between owner and dog, and the emotional relationship embodied in the owners choice of dog food: dog as grandchild ( indulgence), dog as child (love), dog as best friend (health and nutrition) and dog as dog (cheap/ convenient fuel).

When we accept the fact that average consumers and average people don’t exist, we can use market and consumer segmentation to:

·  increase marketing effectiveness,

·  generate greater customer satisfaction,

·  create savings,

·  And to identify strategic opportunities and niches.

Even when a company can afford to target an entire market, it is more successful if products and communications are adapted to individual segments.

A company has to evaluate each segment based upon potential business success. Opportunities will depend upon factors such as: the potential growth of the segment the state of competitive rivalry within the segment how much profit the segment will deliver how big the segment is how the segment fits with the current direction of the company and its vision.

Need for Market Segmentation (Why Market Segmentation?)

Not all individuals have similar needs. A male and a female would have varied interests and liking towards different products. A kid would not require something which an adult needs. A school kid would have a different requirement than an office goer. Market Segmentation helps the marketers to bring together individuals with similar choices and interests on a common platform.

§  Market Segmentation helps the marketers to devise appropriate marketing strategies and promotional schemes according to the tastes of the individuals of a particular market segment. A male model would look out of place in an advertisement promoting female products. The marketers must be able to relate their products to the target segments.

§  Market segmentation helps the marketers to understand the needs of the target audience and adopt specific marketing plans accordingly. Organizations can adopt a more focussed approach as a result of market segmentation.

§  Market segmentation also gives the customers a clear view of what to buy and what not to buy. A Rado or Omega watch would have no takers amongst the lower income group as they cater to the premium segment. College students seldom go to a Zodiac or Van Heusen store as the merchandise offered by these stores are meant mostly for the professionals. Individuals from the lower income group never use a Blackberry. In simpler words, the segmentation process goes a long way in influencing the buying decision of the consumers.

An individual with low income would obviously prefer a Nano or Alto instead of Mercedes or BMW.

§  Market segmentation helps the organizations to target the right product to the right customers at the right time. Geographical segmentation classifies consumers according to their locations. A grocery store in colder states of the country would stock coffee all through the year as compared to places which have defined winter and summer seasons.

§  Segmentation helps the organizations to know and understand their customers better. Organizations can now reach a wider audience and promote their products more effectively. It helps the organizations to concentrate their hard work on the target audience and get suitable results.

Segmentation drives conversion and avoids erosion.

Requirements of Market Segments

In addition to having different needs, for segments to be practical they should be evaluated against the following criteria:

·  Identifiable: the differentiating attributes of the segments must be measurable so that they can be identified.

·  Accessible: the segments must be reachable through communication and distribution channels.

·  Substantial: the segments should be sufficiently large to justify the resources required to target them.

·  Unique needs: to justify separate offerings, the segments must respond differently to the different marketing mixes.

·  Durable: the segments should be relatively stable to minimize the cost of frequent changes.

A good market segmentation will result in segment members that are internally homogenous and externally heterogeneous; that is, as similar as possible within the segment, and as different as possible between segments.

Benefits of Segmentation:

•The Organization gets to know its customers better.

•Provides guidelines for resource allocation.

•It helps focus the strategy of the organization.

Limitations of the Segmentation:

•Targeting multiple segments increases marketing costs.

•Segmentation can lead to proliferation of products.

•Narrowly segmenting a market can hamper the development of broad-brand equity.

Bases for Segmentation in Consumer Markets

Consumer markets can be segmented on the following customer characteristics

·  Geographic

·  Demographic

·  Psychographic

·  Behavioral

Geographic Segmentation

The following are some examples of geographic variables often used in segmentation.

·  Region: by continent, country, state, or even neighborhood

·  Size of metropolitan area: segmented according to size of population

·  Population density: often classified as urban, suburban, or rural

·  Climate: according to weather patterns common to certain geographic regions

Demographic Segmentation:

Demographic segmentation divides the market into groups based on demographic variables including age, gender, family size and life cycle.

The following four variables are examples of demographic factors used in market segmentation:

1. Age: Consumer needs and wants change with age. The marketing mix may therefore need to be adapted depending on which age segment or segments are being targeted.

2. Gender: Dividing a market into different groups based on sex, has long been common for many products including cosmetics, clothing and magazines. In the 1960's car companies such as Toyota began to realize the purchasing power of women, creating marketing campaigns, and then cars, specifically targeted at the female market. Many suggest that the range of interior and exterior colors schemes, and emphasis placed on safety factors by car manufacturers today, is due to in no little part to their desire to market cars to women, as well as men.

3. Life-cycle stage: Dividing a market into different groups based on which stage in the life-cycle, presented in the table below, reflects the fact that people change the goods and services they want and need over their lifetime. Life-cycle stages
Bachelor Stage	young, single people not living at home
Newly Married Couples	young, no children
Full Nest I	youngest child under six
Full Nest II	youngest child six or over
Full Nest III	older married couples with dependent children
Empty Nest I	older married couples, no children living with them
Empty Nest II	older married couples, retired, no children living at home
Solitary Survivor I	in labour force
Solitary Survivor II	retired

4. Income:

Income segmentation is a long standing practice in such categories such as automobiles, clothing, cosmetics, financial services and travel.  However, income does not always predict the best customer for the products.

For example, there is a considerable amount of difference in the PDI’s of USA and India. Levi-Strauss launched premium lines such as Levi’s Capital E to upscale retailers Bloomingdales and Nordstrom, and the less expensive Signature by Levi’s Strauss & Co. lines to mass market retailers Wal-Mart and Target. Signature was positioned as apparel targeted at the middle bracket.  Whereas Levi’s Strauss & Co. launched Signature (now Denizen) in India and positioned it as apparel targeted at the upper bracket youth in India.

This example clearly illustrates the effect of income in different countries with different levels of personal disposable income.

5. Race and Culture:

Multicultural Marketing is an approach that different ethnic and cultural segments have sufficiently different needs and wants to require targeted marketing activities. Race has little importance in India. India however is a country of Multiple Ethnicities. Multicultural Marketing is still in its nascent stages.

Some other demographic segmentation variables include:

·  Family size

·  Generation: baby-boomers, Generation X, etc.

·  Occupation

·  Education

·  Ethnicity

·  Nationality

·  Social class

Psychographic Segmentation

Psychographic segmentation groups customers according to their lifestyle. Activities, interests, and opinions (AIO) surveys are one tool for measuring lifestyle. Some psychographic variables include:

·  Activities

·  Interests

·  Opinions

·  Attitudes

·  Values

Psychographics is the science of using psychology and demographics to better understand consumers. Segmentation- buyers are divided into groups on the basis of psychological/personality traits, lifestyle or values.

By psychographic variables we refer to any attributes relating to personality, values, attitudes, interests, or lifestyles. They are also called AIO variables (for Activities, Interests, and Opinions).  Psychographics provide a useful supplement to demographics. Psychographics focus on general buyer habits, social class, lifestyles, and attitudes as they might relate to a specific product class. Lifestyle is concerned with the activities, interests, and opinions concerning leisure time, work and consumption of the buyer alone or with other with respect to both general behavior and the specific product class. For example, the buyers of Isuzu Motors line of trooper sport utility vehicles tend to be more environmentally conscious and outdoor minded than other consumers.

One of the most common psychographic profiling schemes is the VALS, developed by SRI International, INC. – VALS defined adult consumers into eight segments. They are

 1. Innovators

2. Thinkers

3. Achievers

4. Experiencers

5. Believers

 6. Strivers

7. Makers

8. Survivors

Psychographic considers a number of potential influences on buying behavior, including the attitudes, expectations and activities of consumers.  If these are known, then products and marketing campaigns can be customized so that they appeal more specifically to customer motivations.

The main types of psychographic segmentation are:

Lifestyle – different people have different lifestyle patterns and our behavior may change as we pass through different stages of life.  For example, a family with young children is likely to have a different lifestyle to a much older couple whose children have left home, and there are, therefore, likely to be significant differences in consumption patterns between the two groups.  One of the most well-known lifestyle models, the “sagacity lifestyle model”, identifies four main stages in a typical lifestyle:

Dependent (e.g., children still living at home with parents);

Pre-family (with their own households but no children);

Family (parents with at least one dependent child); and

Late (parents with children who have left home, or older childless couples).

Each group is then further subdivided according to income and occupation. 

Opinions, interests and hobbies – this covers a huge area and includes consumers’ political opinions, views on the environment, sporting and recreational activities and arts and cultural issues.  The opinions that consumers hold and the activities they engage in will have a huge impact on the products they buy and marketers need to be aware of any changes.  Good recent examples include the growth of demand for organic foods or products that are (or are “perceived” to be) environmentally friendly.

Behavioural Segmentation

Behavioural segmentation is based on actual customer behaviour toward products. Some behavioralistic variables include:

·  Benefits sought

·  Usage rate

·  Brand loyalty

·  User status: potential, first-time, regular, etc.

·  Readiness to buy

·  Occasions: holidays and events that stimulate purchases

Behavioural segmentation has the advantage of using variables that are closely related to the product itself. It is a fairly direct starting point for market segmentation.

Behavioural segmentation divides customers into groups based on the way they respond to, use or know of a product.

Behavioural segments can group consumers in terms of:

Occasions

When a product is consumed or purchased. For example, cereals have traditionally been marketed as a breakfast-related product. Kelloggs have always encouraged consumers to eat breakfast cereals on the "occasion" of getting up. More recently, they have tried to extend the consumption of cereals by promoting the product as an ideal, anytime snack food.

Usage

Some markets can be segmented into light, medium and heavy user groups.

Loyalty

Loyal consumers - those who buy one brand all or most of the time - are valuable customers. Many companies try to segment their markets into those where loyal customers can be found and retained compared with segments where customers rarely display any product loyalty. The holiday market is an excellent example of this. The "mass-market" overseas tour operators such as Thomson, Air tours, JMC and First Choice have very low levels of customer loyalty - which means that customers need to be recruited again every year. Compare this with specialist, niche operators such as Laskarina which has customers who have travelled with the brand in each of the last 15-20 years.

Benefits Sought

It is an important form of behavioural segmentation . Benefit segmentation requires Marketers to understand and find the main benefits customers look for in a product. An excellent example is the toothpaste market where research has found four main "benefit segments" - economic; medicinal, cosmetic and taste.

GEOGRAPHIC SEGMENTATION:

CASE STUDY : TATA SALT

The ‘Maine desh ka namak khaya hai’ TATA advertisement campaign in 2002 offered viewers an instant connection. In India, salt and loyalty have been associated from time immemorial. ‘Namak halal” and “Namak Haram” are commonly used terms for honoest and dishonest people respectively. According to cultural connotations, after consuming salt at a person’s house the one who has consumed the salt should not cheat his/her host. The campaign connected with the consumer at an emotional level.

TATA Chemicals Ltd (TCL) started manufacturing salt in 1939 after establishing a solar salt works at Mithapur, Gujarat. It pioneered the concept of iodized and vacuum-evaporated salt in India in the early 1980s and created a need that was not felt by consumers before. Interestingly, the opportunity came accidentally, when in 1983, the company needed fresh water for its boilers that produced soda ash at its Mithapur plant in Gujarat. As fresh water was scarce in the area, the company began processing sea water. Salt of high quality was the by-product. Estimated to be worth Rs.10 billion, TATA has a 21% share in the packaged iodized salt industry in India. According to A.C. Neilson in Brand Track 2002-03, 90% of the people surveyed across the country had tried TATA salt at least once. The salt market is pegged at five million tones out of which 1.5 million tones are of the branded variety. TATA salt leads the market with a 40% share. According to analysts, TATA was able to get the leadership position in the category as it had the first mover advantage. Some competing brands include Annapurna from HLL, Dandi from Kumwar Ajay industries, Shudh from the Mirma Group, Captain Cook from DCW Home foods, Ashiwaad from the ITC stable, besides some international brand likeCargil and Congra. From vaccum-evaporated’to ‘iodized’ from ‘free flow’ to ‘danedar’, one does not see much brand differential among competitive brands, hence the need for a strong and memorable advertising plank and better packaging. One finds vigorous advertising by major players in the mass media. Looking at the overseas potential, TATA, according to industry buzz, is exploring the Middle East market and those of neighboring countries like Nepal and Bangladesh.

Tetley’s overseas distribution network could come in handy for marketing the salt in these countries. In order to expand the user base, TATA salt that is priced at Rs 8 per kilogram, against un-branded salts at Rs 3-4 per kg. The company has launched its economy brand ‘Samundar’ at Rs 5 per kg. Purity, trust, and value have been the planks of its communication strategy. The earlier catch-line, ‘Namak ho TATA ka, TATA namak’, was changed when more competitors came into the market, and the need for an emotional bond was felt. Besides an aggressive approach to branding, the company improved packaging, sales, and supply chain management. Figure 1.11 (see plate 2) shows its new packaging. According to company sources, consumer research by TATA Chemicals in June 2002 revealed that people had a sense of insecurity and disgust for corruption, which they thought were eroding Indian democracy. The insights that the research provided helped in tapping patriotic and nationalist fervour. TATA took the opportunity to be associated with the universal theme of ‘remaining true to one’s salt and to one’s country’. This was the philosophy behind the ‘Meine desh ka namak khaya hai’ tagline. The new packaging, with the visual of delectable cuisine, backed this. ‘Vacuum evaporated’ and ‘iodized’ were clearly written on the pack a plank that other competitors also used. The advertisement with the visual of a banana leaf and a pinch of salt in a corner (a traditional serving in south India) with the headline (figure 1.12): ‘To Indian housewives, our salt always comes first’ and the catchline ‘Meine desh ka namak khaya hai’ was considered by analysts as amongst the greatest advertisements when it appeared. In order to connect with communities, TATA salt has used public relations to sustain the brand on a long term basis. Since the lauch of the ‘Desh ka namak’ campaign in 2002, during some specified months, a small percentage of money that accurues from the sale of TATA salt is set aside for economcically disadvantaged children. In the twoyears since the lauch, 25,000 children have been provided with one year of education. 

Psychographic segmentation: (Examples)

Innovators:

They’re usually successful, sophisticated, active, “take charge” people with a high self esteem. Purchases often reflect cultivated tastes for relatively upscale, niche oriented products and services.  Here we’re considering the niche market of upscale segmentation by technology adaptation.

For example, let us consider the Apple's iPad. It represents a new mainstream market segment for the technology industry, which will experience considerable growth over the next few years, it has been claimed.  Apple's product strategy is a study in market segmentation. In contrast to merely trying to stuff a product, burrito-style, with as many different features as possible, they target specific user experiences, and build the product accordingly.

Thinkers:

They’re mature, satisfied, and reflective people motivated by ideals and who value order, knowledge, and responsibility. They seek durability, functionality, and value in products. Here we’re considering Mont-Blanc.

 For nearly one hundred years the name Mont-blanc has stood for the art of writing, while the snow-covered peak of Mont Blanc has symbolised the high quality status of the brand with the distinctive white star. 

Mont-blanc’s classic fountain pen, the Meisterstück first produced in 1924, has become a cult object. Not only because of its timeless design, but also because of the unmistakable values which are so characteristic of the entire Montblanc collection. They are established values that take on a new and greater significance as modern life develops faster and faster; values such as tradition, fine craftsmanship and an appreciation of the need to take time for the essentials - for reflection, feelings, beauty and culture. 

Every Mont-blanc product created over the years bears witness to these values. From the classic Meisterstück fountain pen to desk accessories, hand-crafted Meister-Bütten paper, fine leather and jewellery and the new Meisterstück watch collection - they are the results of traditional craftsmanship which confers a sense of eternity on their owners.

Achievers:

They’re successful, goal oriented people who focus on career and family. They favour premium products that demonstrate success to their peers. In this segment we can consider most of the premium timeless luxury watches, such as Rolex, TAG Huer, and Omega. Neil Armstrong gave Omega speed master the ultimate endorsement when he wore it on his historic moon walk in 1969.

Experiencers:

They’re the young enthusiastic, impulsive people who seek variety and excitement. They spend a comparatively high proportion of income on fashion, entertainment, and socializing. For example, we consider, Fossil watches, handbags, wallets and clothing. Founded in 1984, Fossil introduced watches which were trendy as well as The Fossil brand was founded in 1984 and its main focus is on bringing fashion to functionality. Fossil offers separate watch ranges for men as well as ladies. You will come across watches in varied looks and styles such as classic, adventure, acetate, wood, stainless steel and so on. The Fossil watch range is offered in categories such as sports watches, dress watches, digital watches, trend watches, mechanical watches, Stark Watches and so on.

They are preferred by men who wish to portray a trendy look and profile. They can check out rugged watches, watches with dials in reverse colours, straps in polycarbonate material and even formal watches.

Believers:

They’re conservative, conventional, and traditional people with concrete beliefs. They prefer familiar, Indian made products and are loyal to established brands. Here we consider Bisleri. As one of the world’s most trusted brands. Bisleri is leading the way in bringing about positive change in our daily lives. They believe in being a part of a meaningful movement called the ‘Aqua Green Revolution’.

Strivers:

They’re trendy fun loving people who are resource constrained. They favour stylish products that emulate the purchases of those with greater material wealth. Considering Pierre Cardin- It is the first couturier to bring fashion into the street, revolutionize men's style, apply a brand licensing system in 1960, set up operations throughout the world, and get notable in Japan, China and Russia.

Pierre Cardin is known for avant-garde style and space age designs. It prefers geometric shapes and motifs, often ignoring the female form. It advances into unisex fashions, sometimes experimental, and not always practical. Pierre Cardin's empire rapidly expanded past fashion frontiers to accessories, furniture, art and environment. With 900 licenses spread out through 140 countries, the Pierre Cardin trademark is considered one of the most powerful in the world. Pierre Cardin offers fashion and style without sacrificing function, durability and customer service.

Makers:

They’re practical, down to earth, self sufficient people who like to work with their hands. They seek Indian made products with a practical or functional purpose. Here we take the example of Amul. Amul was set up in 1946 and its full form is Anand Milk- producers Union Ltd. The Brand Amul is a movement in dairy cooperative in India. The management of the brand name is done by the Gujarat Co- operative Milk Marketing Federation Ltd (GCMMF) which is a cooperative organization. 

Survivors:

They’re elderly, passive people concerned about change and loyal to their favourite brands. Parle Products has been India's largest manufacturer of biscuits and confectionery for almost 80 years. Makers of the world's largest selling biscuit, Parle-G, and a host of other very popular brands, the Parle name symbolizes quality, nutrition and great taste. With a reach spanning even to the remotest villages of India, the company has definitely come a very long way since its inception.

Many of the Parle products - biscuits or confectioneries, are market leaders in their category and have won acclaim at the Monde Selection, since 1971. With a 40% share of the total biscuit market and a 15% share of the total confectionary market in India, Parle has grown to become a multi-million dollar company. While to the consumers it's a beacon of faith and trust, competitors look upon Parle as an example of marketing brilliance.