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Markets & Marketing


Marketing Assignment

7/13/2009 Jonathan Jeevan Strinivas Kovilpillai TP019794 TPMP0903TM

Markets & Marketing

Marketers have had to change their approach to marketing problems due to the changing commercial landscape plus changes in consumers and organizations over the last half century. These changes were a result of different areas of focus in the area of Marketing Management.

In the Journal of Marketing Management, Constantinides (2006, p. 407) defined these areas according to the decades as follows; 1970s Broadening of Marketing Concept, 1980s Emphasis on Exchange Transaction, 1990s Total Quality Management, and at present ICT factors in Marketing.

Some of these changes have produced desired results, and huge profits to the organizations, while others have floundered and cost businesses dearly, both in profits and reputation.

The objective of this paper is to identify some of these critical changes in the market place today as we approach the final year of the first decade of the twenty-first century. We will also look at some changes in approach and/or strategies that will enable businesses to succeed in these changing times. One of the key areas of focus of this paper will be the continued relevancy, or otherwise, of the Marketing Mix. Is the mix still relevant as markets change, and customers change together with it?

In the area of consumer marketing, we see changes taking shape due to many factors. It is no more a supplier marketplace as first espoused by the likes of Henry Ford when he supposedly famously claimed that hell produce cars in whatever color the consumer wanted, so long as it was in black. Todays consumer wants goods and services fast, of good quality, variety, and without price as his main consideration. Marketers can no longer convince consumers they need things and they will be unhappy and inferior people if they do not have these necessities (Solomon, p.48).

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Markets & Marketing

Besides customer empowerment, as mentioned above, there are other factors causing this shift in business patterns. Technology is still changing at a rapid pace; todays technologies become obsolete and are replaced by newer ones even before you can learn how to operate them.

In fact, trendwatching.com, a website that observes and previews emerging trends, argues in its May 2009 issue, that even in the current global economic downturn, most businesses are using innovation to maintain their share of the market pie (Innovation Jubilation, 2009). Businesses that are savvy and ahead of the game are incorporating technological innovations for empowered customers to give this new breed of customers what they want in terms of customization.

The impact of global warming upon the social consciousness of corporations is also playing a major role in determining how they do business. Businesses that do not heed natures call as expressed through the will of its customers and the politico-legal environment they operate in will most definitely find them squeezed out of the global playing field.

However, an exception must be recorded here that as far as marketers are concerned, as previous experience shows, environmental issues have been exploited for commercial purposes before. What we are seeing today is the third wave of environmentalism where companies are shifting from protest to preventionand regulation to responsibility (Kotler & Armstrong 2004, p642).

Companies that rode the green wave as a popularity drive previously, have to face the fact that the green wave is here to stay, as consumers fears are rubbing off on them and their bottom lines. Even giants in their respective fields; British Petroleum, Wal-Mart and Intel have accepted that investing in green is the next big thing (Green Finance, 2008).

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Markets & Marketing

The fourth area we will look at is a phenomenon commonly known as globalization. Globalization has changed the way the global marketplace views each other as players. Nations are no more purely competitors, but complementors in the sense that the entire global market is now complementing each other in the production and distribution of goods and services. The loosening of regulations to enable free trade has enabled business relationships to flourish as never before. Businesses with the ability to make global purchases tend to be more sophisticated about suppliers and prices (Gillespie, Jeannet & Hennessey, 2007 p.162). This proliferation of choice that global customers have, has forced marketers to be more proactive in marketing their products.

What we have espoused thus far are some of the growing and changing trends or forces that are influencing these trend changes. However, the main question remains as to whether businesses are equipped to flow with these changes and ride the tide or face a tidal backlash. Even traditional marketing gurus like Philip Kotler, way back in 2002, (Kotler, Jain, Maesincee, p.3) had spoken about changes in business and marketing strategies that would need to be addressed. As articulated earlier in this paper, customers in the 21st century are a more demanding lot. It was also mentioned that many factors contribute to this change. One of the key factors is the advent of technology and together with it, the emergence of interactivity. Interactivity has made the customer more accessible to the business and vice-versa. As a result of this, customers today and in future are going to demand more value from a business. If a business cannot up the value that a customer obtains from it, the customer will walk away. Companies today have to look beyond the traditional make and sell concept and see themselves, especially their marketing function, as a part of a greater whole. This big picture is often called the value chain, and the marketing function must be an integrated part of this entire chain.

Jonathan Jeevan Strinivas Kovilpillai TP019794

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Markets & Marketing

Added Value Michael Porter argues in his ground breaking Competitive Advantage (1985) that adding value for a customer must include a holistic marketing approach, a view that he shares with Kotler and Jain (2002, p.29), and a view that is similar to what is espoused above. The Holistic Marketing Framework below shows this holistic approach that should be the strategy utilized to acquire, retain and relationship with 21st century customers. The limitation of the scope of this paper prevents us from delving deeper and reviewing the role of the Holistic Marketing Framework. However this does not reflect in any way of its relevance.

CUSTOMER FOCUS VALUE EXPLORATION VALUE EXPLORATION VALUE EXPLORATION COGNITIVE SPACE CUSTOMER BENEFITS

CORE COMPETENCIES COMPETENCY SPACE BUSINESS DOMAIN

COLLABORATIVE NETWORK RESOURCE SPACE BUSINESS PARTNERS

CUSTOMER RELATIONSHIP MANAGEMENT

INTERNAL RESOURCE MANAGEMENT

BUSINESS PARTNERS MANAGEMENT

Figure 1

The argument for creating added customer value is timely as the new consumer demands customization to his or her needs, wants to experience the product instead of only viewing its performance and wants to have a say or input into the production of the product. A seismic change in marketers philosophy is therefore imminent.

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Markets & Marketing

Nowhere is this seen more clearly than in the sphere of technological innovation. In a sense, it could be argued that technology is the driver that is forcing marketers to change. George Bodenheim, CEO of ESPN, states this clearly when he says that its a minute to minute battle to retain viewers (customers) in todays media world. (McGrawHill, 2007).

Technology Jive Apart from the dot.com boom in the late 90s and early this millennium, which went bust for some, the last few years have seen the gradual and steep increase in technology based businesses. Companies that have adapted to this have seen success and have set benchmarks or patterns for what is to come. And what is to come is the scenario where technology will no more be an addendum to businesses, but rather the standard operating procedure for all businesses. Businesses must start now by taking the bull by the horn, so to speak, and convert their focus of using technology as an asset into focusing on adapting their businesses to jive with technology. What George Bodenheim was referring to in the earlier instance was about ESPNs foray into mobility. ESPN has decided on the strategy of serving sports fans anytime, anywhere and via any device. (Corporate Fact Sheet 2006).

Mobility is a sure fire strategy that is evidently giving companies a competitive advantage. Todays technological advancement coupled with the I-want-it-all-I-want-it-now consumer has given birth to content being streamed directly to mobile devices. Up to date news, events and even happenings can be delivered direct to the customer wherever they are and whenever they want it.

Social networks like Twitter are quickly being followed by commercial companies promoting mobility based solutions. Allowing customers control content remotely, bringing events to mobile users and even using mobile phones for branding are becoming the norm today and even startup companies such as DialPlus, Toro, Goodrec, Pixelpipe and a host of similar unfamiliarly named companies are jumping on the bandwagon (Under The Radar: Lessons For Mobile Marketers 2008).
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Markets & Marketing

Mobility also will provide an alternate method of affiliate marketing as companies piggy-back on mobile news networks, game sites and others to pop advertisements out to customers. Traditional marketing mix concepts of place and promotion will be threatened by this incursion into territories long believed to be their sacred domain.

As products and services become more mobile with the ever increasing technology, marketers have also stumbled upon another strategy of generating repeat sales and customer dependency. Upgrades are now sold in module forms so that a customer will not have to buy another new product each time a technology gets advanced. An additional module to the existing product will serve this purpose equally well. Canon successfully has started the ball rolling in this direction with the additional hand-grip for its DSLRs.

Lifestyle Marketing People of the baby boom generation who witnessed the first two waves of environmentalism are naturally cautious about companies, and especially marketers, who are trumpeting environmental issues once again. This time around however, consumer reaction to the fear surrounding the environment can is no longer being ignored by the companies. Companies are making concrete strategies to engage with their customers and come up with environmentally friendly products, services and even marketing activities. In order to be relevant in future, marketing must take a path that we will call lifestyle marketing. The LOHAS an acronym for lifestyles of health and sustainability (2009, p.181) - category of people are spearheading the move for more ecologically friendly production, packaging and even distribution to the tune of more than 200 billion US dollars per annum. The demands made by this ever increasing group of people around the world range from hybrid cars to mundane soap packaging. Companies must respond in kind to this demand. They already have, with even giants in the industry like Toyota and Unilever, already flooding the market with ecologically friendly and biodegradable products. Even in this we see the traditional marketing mix element of product being challenged off its perch in the sense of the market no longer accepting the product but rather the market shaping the product.
Jonathan Jeevan Strinivas Kovilpillai TP019794

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Markets & Marketing

Globalisation Effect The final factor we will discuss within the ambit of this paper will be new strategies that will take advantage of the more open marketplace which has resulted from globalization. This one single economic and international trade trend has changed the way marketing is done more than any other. The reasoning for this is straightforward; what works in the home country will most likely NOT work in a foreign country. Strategies need to be relooked, promotions need to be redesigned, targets need to be reset or re-segmented and in some cases, even marketing lingo needs to be reworked.

A simple strategy that will be useful will be to analyse deficiencies in foreign markets and filling them with products and services that you are comparatively advantaged in. Then, after identifying market opportunities, the marketer will then need to look at his resources to be able to compete in this foreign market. The challenges that will need to be overcome in global marketing will be as wide and varied as the number of countries that a company wishes to operate in.

Emerging markets are a relatively profitable environment to enter, provided the company has its basics right. Businesses will be able to find many niches there that could be filled at a small cost compared to starting up a similar one on home ground. The debate on whether to penetrate emerging or established markets leans heavily towards the developing market as even market leaders rely on developing or emerging markets to fuel their continued growth (Kotler & Keller, 2009 p. 641).

On the other hand, naysayers have sounded the death knell for global marketing with the current economic crisis. We beg to differ, and would suggest on the contrary, that this crisis is actually an opportunity for businesses to get their palms into economies where the operating costs will be low due to the economic crisis. They will then enjoy the benefit of securing a position in the economy when it will eventually recover and go into a period of growth.

Jonathan Jeevan Strinivas Kovilpillai TP019794

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Markets & Marketing

Conclusion Without a doubt, the new millennium has brought about many changes and thrown up many new opportunities for businesses. We have looked at some of them in the light of how consumers have changed, technology has advanced, social and environmental concerns have dominated and also in relation to the shrinking nature of the global market. Recommendations and suggestions have also been made. Companies that are comfortable with traditional marketing methods and principles may be left behind. Maybe a new set of principles need to be created. Maybe new models must evolve. Maybe mindsets must change. But do companies dare. Do businesses dare? How much of the fundamentals are we willing to shake in order to take advantage of the changing environment around us and the opportunities it presents?

Jonathan Jeevan Strinivas Kovilpillai TP019794

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Markets & Marketing

References 1. Constantinides, E 2006, The Marketing Mix Revisited: Towards the 21st Century Marketing, Journal of Marketing Management, vol. 22 pp. 407-438 2. Solomon, Michael R 2009, Consumer Behavior Buying, Having and Being, Pearson Education, New Jersey, USA 3. Innovation Jubilation 2009. Retrieved July 3, 2009 from http://trendwatching.com/trends/innovationjubilation/ 4. Kotler, Philip & Armstrong, G 2004, The Principles of Marketing Tenth Edition, Pearson Education International, New Jersey, USA 5. Green Finance 2008. Retrieved June 26, 2009 from http://www.gfmag.com/archives/29-sept2008/86-green-finance.html 6. Gillespie, K, Jeannet, JP, Hennessey, DH 2007, Global Marketing Second Edition, Houghton Mifflin, Boston USA 7. Kotler, P, Jain, DC, Maesincee, S 2002, Marketing Moves A new approach to profits, growth and renewal, Harvard Business School Press, USA 8. Porter, Michael E, 1985, Competitive Advantage: Creating and Sustaining Superior Performance, Free Press, New York, USA 9. Kotler, P, Jain, DC, Maesincee, S 2002, Marketing Moves A new approach to profits, growth and renewal, Harvard Business School Press, USA 10. McGrawHill, 2007 Marketing Power Plays (Comp) 11. Corporate Fact Sheet 2006. Retrieved June 30, 2009 from http://sports.espn.go.com/espn/news/story?page=corporatefactsheet 12. Under The Radar: Lessons For Mobile Marketers 2008. Retrieved July 3, 2009 from http://www.mobilemarketingwatch.com/under-the-radar-lessons-for-mobilemarketers/#more-1683 13. Solomon, Michael R 2009, Consumer Behavior Buying, Having and Being, Pearson Education, New Jersey, USA 14. Kotler, Philip & Keller, Kevin L 2009, Marketing Management 13th Edition, Pearson Education, New Jersey, USA
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