In last Lesson the focus of discussion was core concepts of the marketing and the increasingly important role of the marketing process in the ever-changing domestic and global business environment Today we will be covering following topics: Show
A. MARKETING CHALLENGES IN THE 21st CENTURY.The marketing concept has changed dramatically over the last several decades, and recently the focus has increasingly moved to customers (versus products and selling) marketing globally and the various technology issues that impact the market. In addition, there is renewed emphasis in marketing on creating and innovating with new and better products and services rather than just competing against other firms and following the marketing patterns established by competitors. A. Porter’s 5 Forces Model of Competition: Marketing is facing different challenges in the 21st century to meet these Before entering the business Porter model can be used to analyze the environment both for new and existing business and can be used to overcome and meet the challenges. • Threat of New Entrants Ratio of new entrants in the industry greater the ratio greater will be intensity of competition • Bargaining Power of Buyers: When competition is intense and number of manufacturer is greater the buyer have more options for product switching over this will increase the buying power of buyer • Threat of Substitute: As obvious from the term greater the threat of new entrants will result in greater higher completion that in tern will result in increase in the number of substitutes • Bargaining Power of Suppliers: Greater number of the supplier will provide the stronger buying power to the manufacturer/customer and vice versa • Rivalry Among Competing Firms in Industry: Larger number of the manufacturers and greater number of product variety increases the rivalry among the competitors, which demands for more quality and customer satisfy9ng products in order to meet the competition. A. The information technology revolutionThe information age, particularly the advent of the Internet is having a major impact on the direction of marketing science and practice. Digitalization and Connectivity: The flow of digital information requires connectivity Intranets, Extranets, and the Internet are key drivers of the “new economy Technologies for Connecting b. The major force behind the new connectedness is technology. c. The boom in computer, telecommunications, and information technology, as well as the merging of these technologies, has had a major impact on the way businesses bring value to their customers. 2). New applications include: 3). Marketplaces have now become market spaces. • Connections with Customers Today, most marketers are realizing that they don’t want to connect with just any customers. Instead, most are targeting fewer, potentially more profitable customers. 1). Greater diversity and new consumer connections have meant greater market fragmentation. 2). At the same time, companies are analyzing the value of the customer to the firm. What value does the customer bring to the organization? Are they worth pursuing? 3). Companies are spending more time considering “share of customer” and less time worrying about “share of market.” 1). Products are now available via telephone, mail-order catalogs, kiosks, and electronic commerce. • Connections with Marketing’s Partners Connecting inside the company--traditionally, marketers have played the role of intermediary, charged with understanding customer needs and representing the customer to different company departments,
which then acted upon these needs. a). Now, every employee must be customer-focused. • Connections with the World Around Us Marketers are taking a fresh look at how they connect with the broader world around them. 1). Global connections--geographical and cultural differences and distances have shrunk dramatically in the last decade. 2). Today, almost every company, large or small, is touched in some way by global competition. B. Rapid GlobalisationTechnological and economic developments continue to shrink the distances between countries. World is becoming global village due to advancement in the connecting technologies. The world is shrinking rapidly with the advent of faster communication, and transportation, and financial flows. In the Twenty-First century, firms can no longer afford to pay attention only to their domestic market, no matter how large it is. Many industries are global industries, and those firms that operate globally achieve lower costs and higher brand awareness. At the same time, global marketing is risky because of variable exchange rates, unstable governments, protectionist tariffs and trade barriers, and other prohibitive factors Global Marketing into the Twenty-First Century: a. The world is shrinking rapidly with advent of faster communication, transportation, and financial flows. h. A global firm, is a firm that, by operating in more than one country, gains marketing, production, R&D, and financial advantages in its costs and reputation that are not available to purely domestic competitors. C. The Changing World EconomyEven as new markets open to rising affluence in such countries as the "new industrialised" pacific rim, poverty in many areas and slowed economies in previously industrial nations has already changed the world economy. The New Economy presents many new challenges and opportunities for the marketer. The most important point is that the New Economy assuredly places the customer more firmly in the driver’s seat for decisions on her/his product and service choices (customization and customerization). In addition, there have been and will be many changes in business and marketing practices as both consumers and businesses have virtual and real-time access to literally millions of products, offers, options, prices, people, competitors, and sources of information that did not exist until recent years. As a result, the marketing mix will change as marketers and firms identify new uses for intangible assets and effective customer relationship management that is more than a marketing term. We can assume that this increasingly rapidgrowth and rate of change will continue, and despite the dot-com bust, recession, and other major social, political, and economic adjustments, the Internet and the New Economy have changed marketers and marketing for the long-term future. D. The Call for More Ethics and Social ResponsibilityThe greed of the 1980's and the problems caused by pollution in Eastern Europe and elsewhere has spurred a new interest in ethical conduct in business. Social and ethical issues in marketing: Connections with our values and social responsibilities--as the worldwide consumerism and environmentalism movements mature, today’s marketers are being called upon to take greater responsibility for the social and environmental impact of their actions. The social responsibility and environmental movements will place even stricter demands on companies in the future. Those that resist will be forced into compliance by legislation or consumer outcries. 1. High Prices High Costs of Distribution can be misleading. Among other reasons, consumers want to know about products, it is expensive to advertise and promote, brands provide psychological benefits and quality standards, and distribution costs include delivering the product not just promoting it. High Advertising and Promotion Costs are determined in a competitive marketplace where consumers often have real choices. Excessive Markups are the exception rather than the rule and are more likely in uncompetitive industries. Ethics can influence strategic decisions on such pricing decisions as market penetration versus market skimming 2. High costs of distribution. It is often argued that middlemen are greedy and mark up prices beyond the value of their services. A comprehensive implementation of marketing ethics should include policies and guidelines for defining the company's relationship with distributors 3. High advertising and promotion costs. Modern marketing is also accused of pushing prices up to cover the costs of heavy advertising and sales promotion. When considered in light of increasing activism among consumer groups to regulate advertising, marketers have a unique opportunity to proactively address the needs for strong advertising ethical standards. While protecting free speech, marketers could adopt a statement on ethics in advertising that promotes accurate information exchange, encourages creative and innovative message generation. 4. Excessive middlemen gross profit margins. Critics say that middlemens gross margins are excessive. 5. Deceptive Practices Deceptive pricing includes practices such as falsely advertising "factory" or "wholesale" prices or a large price reduction from a phoney high list price. Deceptive promotion includes practices such as overstating the product's features or performance, luring the customer to the store for a bargain that is out of stock, or running rigged contests. Deceptive packaging includes exaggerating package contents through subtle design, not filling the package to the top, using misleading labeling, or describing size in misleading terms. 6. High-Pressure Selling People are free to not respond to selling tactics. Moreover, most states have "cooling off" periods that allow buyers to return products or back out of a purchase for large ticket items. 7. Unsafe Products Dangerous products are most often illegal. Corporate marketing policies can provide broad guidelines that everyone in the organization must follow 8. Product Development. Product development may be influenced by ethical codes seekingmore desirable products or changes is salutary product concepts to make them more desirable. E. The New Marketing Landscape The new marketing landscape is a dynamic, fast-paced and evolving function of all these changes and opportunities. More than ever there is no static formula for success. Customer is known as the king in the marketing and all efforts of the organization rate directed towards the customer satisfaction this provides new landscape to the marketing and development of the connecting technologies are playing primary role in this concern. What is one of the best ways to increase share of customer?How to Increase Market Share?. Innovation. Innovation is an excellent method of increasing market share. ... . Lowering prices. A company can also expand its market share by lowering its prices. ... . Strengthening customer relationships. ... . Advertising. ... . Increased quality. ... . Acquisition.. Which of the following is the full set of benefits a company promises to deliver to customers to satisfy their needs and upon which its brand is positioned with customers?A value proposition refers to the value a company promises to deliver to customers should they choose to buy their product. A value proposition is part of a company's overall marketing strategy.
Which marketing management concept is concerned with aligning company goals to satisfying customer needs and wants better than the competition?The Marketing Concept. The marketing concept is the philosophy that firms should analyze the needs of their customers and then make decisions to satisfy those needs, better than the competition.
Is an attempt to manage how potential customers perceive a product or service?Perceptual mapping is a diagrammatic technique used by marketers in an attempt to visually display the perceptions of customers or potential customers. Typically the position of a product, product line, brand, or company is displayed relative to their competition.
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