LECTURE 1 ---- PERSPECTIVES ON MARKETING AND ITS ROLE

IN A CHANGING WORLD
Note marketing has a central role for business success since it is
concerned with the creation and retention of customers. Companies
recognise the importance of building relationships with customers by
providing satisfaction and attracting new customers by creating added
value. The objective of marketing is to establish, develop and
commercialise long-term customer relationships so that the objectives of
the parties are met. The notion of customer satisfaction as the central
pillar of marketing is fundamental to the creation of a stream of
exchanges upon which commercial success depends.
Some definitions
- The income producing side of the business
- The primary management function which organises and directs the
aggregate of business activities involved in converting customer
purchasing power into effective demand for a specific product or
service and in moving the product or service to the final consumer
so as to achieve the profit target or other objectives set by the
company
- Those business activities which are concerned with firstly
identifying and stimulating demand for a companys products and
services, secondly meeting that demand by making available the
products or services in the most effective manner, and thirdly
achieving the profit and other objectives related to the
identification, stimulation and satisfaction of demand
-

Getting the right products [and services] to the right people in the
right places at the right time and the right price

- Marketing development is systematic forward planning so as

to ensure matching of resources to fit market trends and to ensure
continued growth for the enterprise
- The establishment of contact
- The social science concerned with market transactions
- Marketing is not only much broader than selling, it is not a
specialised activity at all. It encompasses the whole business. It is

the whole business seen from the point of view of its final result,
that is from the customers point of view. Concern and
responsibility for marketing must therefore permeate all areas of
the enterprise
- A point of view, a concept, a way of thinking
- Adjusting the whole activity of a business to the needs of the
customer or potential customer
The marketing concept can be noted as the achievement of corporate
goals through meeting and exceeding customer needs better than the
competition. The concept can be seen to be made up of customer
orientation ie corporate activities are focussed upon providing customer
satisfaction, integrated effort ie all staff accept the responsibility for
creating customer satisfaction, goal achievement ie the belief that
corporate goals can be achieved through customer satisfaction.
Marketing-oriented companies attempt to create customer value in order
to attract and retain customers. They implement the marketing concept by
meeting and exceeding customer needs better than the competition.
Consumers decide upon purchases on the basis of judgements about the
values offered by suppliers. Once a product has been bought , customer
satisfaction depends upon its perceived performance compared to the
buyers expectations.
Note be aware of the jobs performed by marketers within the company
- advising upon new product/service developments and managing
the product/service portfolio
- setting prices for products/services
- developing different forms of communication with the marketplace
- developing different modes of distributing products/services
- undertaking marketing research
- analysing consumer behaviour
- forecasting future levels of business
AND many more responsibilities
Could identify four main functions of marketing management
- Planning ie. contributing to the process of corporate business
planning. The marketing function should have a major influence on
what businesses the company should be in, what markets it should
serve, what products/services it should offer, and what investments
it should make. Marketers need to provide detailed sales and

market forecasts for the companys annual operating and budget

plans.
- Organising - ie. identifying how to manage the different roles
performed by marketing staff and managing the relationship
between marketing and other corporate functions
- Motivating, Guiding or Directing ie. marketers have a role in
guiding and motivating the management of the other main business
functions into maintaining an effective level of marketing
orientation
- Controlling - ie. managers are responsible for monitoring and
adjusting the operations of the business so that its objectives are
achieved. Marketing management will be responsible for the
achievement of its own direct departmental objectives.
KEY THEMES OF LECTURE
Defining marketing seeing marketing as a function, as a management
process, as a philosophy. To appreciate that marketing considerations
underpin corporate strategy and permeate the whole organisation. The
marketing philosophy is a way of doing business that places the customer
at the centre of everything and acknowledges that the whole organisation
should be oriented towards developing positive relationships with
customers and meeting their current and future needs.
Tracing the development of marketing as a way of doing business and
considering the ways in which marketing is changing.
Appreciating how marketers operate at the interface between the
organisation and its customers.
Understanding the scope of tasks undertaken in marketing, and the range
of different organisational situations in which marketing is applied.

LECTURE 2 ----- MARKETING CHALLENGES IN THE 21ST

CENTURY
Marketers are fundamentally rethinking their philosophies, concepts and
tools. Think about the followingEveryone does the Marketing ie interdepartmental teamwork
becoming more important in achieving marketing plans, particularly
with regard to new product development, customer retention, and
seizing competitive advantage.
Not Product-centred but organising by Customer Segments ie careful
definition needed of how a company approaches segmentation.
Not making everything but buying more products and services from
outside ie companies increasingly subcontracting activities to
outsourcing firms.
Work with fewer suppliers in a partnership ie make effective
arrangements with key suppliers, distributors and agents.
Emphasise Intangible Assets ie particularly brands, the customer base,
distributor and supplier relations, and intellectual capital.
Build Brands through Performance and Integrated Communications ie
do not rely on one communication tool , blend a range of tools to
ensure a consistent brand image is provided to the marketplace.
Making Products and Services available online.
Focus on Customer Lifetime Value ie designing products and services
to make a profit over the customers lifetime.
Focus on the Marketing Scorecard ie interpret what is happening to
market share, customer loss rate, customer satisfaction. Product
quality etc.
Focus on stakeholders ie assess their importance in making the
company prosperous.
Consider successful companies --Marketers adopt a more proactive, aggressive approach towards the
future.

Marketers have a more proactive approach to new product

development.
A higher importance is placed on marketing training.
Marketing has a higher status within the company.
Longer time horizons for marketing planning are adopted.
Marketers are working more closely with other functional areas.
Marketers are making a greater input into strategic plans.
Note the following ---The success that high-performance companies have had in raising the
quality of their products and services has led to continually rising
customer expectations. Customers will no longer accept the delays,
variations in product performance, and dismal service of the past.
Competition and rising customer expectations are shortening the time
taken for new technologies to gain mass-market acceptance.
Competition is unquestionably getting tougher in most industries.
Many of the weaker players have been shaken out. Market barriers have
fallen with declining tariffs, lower transport costs, and the speed of realtime information about market opportunities. Eroding profit margins and
pressures from shareholders are forcing all companies to sharpen their
competitiveness and raise their level of performance.
Customers increasingly want a service rather than a product. Real
product advantages are difficult to gain and even harder to maintain, so
that differentiation is increasingly based upon how companies augment
their products with additional services. Differentiation in services and
software is a continually developing competitive background.
Profitable products and market niches invariably attract new entrants
that copy the successful innovators and compete for market share by
lowering prices. Unless companies can keep moving the goalposts
through faster innovation, profit margins inevitably decline.
In most markets the mega-brands are losing share. Intensified
competition and innovation and more options are leading to a changing
diversity of micro-brands rather than a few mega-brands.
Products that are harmful to the environment face increasingly
stringent constraints and outright bans.
The raising of ethical standards companies that pursue policies
which look unfair, immoral or dangerous are coming under increasing
scrutiny.
Think global common demands and expectations are being seen in
most countries.

Organising for Marketing ---Breaking hierarchies

Small business units
Self-managing teams
Strategic alliances
Transnational organisation
Learning organisation
Account management
Expeditionary marketing
Role of stakeholders in the company
KEY THEMES OF LECTURE
Recognising that dramatic changes in the market-place create
opportunities and challenges for marketers. Major marketing
developments can be summed up in a single theme connections. The
explosive growth in connecting technologies - computer,
telecommunications, information, transportation technologies has
created exciting new ways for marketers to learn about and serve
consumers, in large groups or one-to-one.
Understanding that marketers are redefining how they connect with their
customers, with their marketing partners and with the world around them.
They are choosing their customers more carefully and developing closer,
more direct, and more lasting connections with them. They are also
connecting more closely with other company departments and other
organisations in an integrated effort to bring more value to customers.
They are taking a fresh look at the ways in which they connect with the
broader world, resulting in increased globalisation, growing attention to
social and environmental responsibilities, and greater use of marketing by
non-profit and public sector organisations

LECTURE 3 ---- THE DYNAMIC MARKETING ENVIRONMENT

Note five stages of environmental analysis
audit of environmental influences
assessments of the nature of the environment
identification of the key environmental forces
identification of the competitive position
identification of the principal opportunities and threats
strategic position
The PEST framework for environmental auditing
Political and Legal Factors
Economic Factors
Social and Cultural Factors
Technological Factors
Ask questions which are fundamental to how a company is relating to its
environment --How complex is the environment
How standardised are organisational interactions with elements of the
environment
How interconnected and how remote are the significant environmental
variables
How dynamic and how unpredictable are the changes taking place
around the organisation
How receptive is management to the ways in which environmental
pressures adversely affect the input and output processes of the
company

How high is flexibility of choice and to what extent is the company

constrained from moving into new areas
Responding to the changing market by coming to terms with the future
--- three approaches --to ignore what is happening and accept the consequences of strategic
drift
to respond quickly or slowly, but largely reactively
to try to predict the nature of the changes and then manage proactively
The third approach is difficult , but how can a company get to the future
first. It is the failure to do this and for external change to move ahead
faster than management learning that typically creates significant
problems for the marketing planning team. Recognising this allows us to
identify five types of manager
Those who make it happen
Those who think they make it happen
Those who watch it happen
Those who wonder what happened
Those who fail to realise that anything has happened
The last two manager types are significantly noticed when the company
has a poorly developed or non-existent marketing information system.
The marketing planner can then either continue to deny the nature and
significance of market changes or respond in one of a number of ways
Moving towards the future
Stage 1 The initial shock when managers recognise the mismatch
between the environmental demands
Stage 2 - Denial of the significance of the changes taking place and a
temporary retreat from reality
Stage 3 - Gradual recognition of the significance of market change
Stage 4 - Acceptance of the need to change the strategy and marketing
behaviour in major ways
Stage 5 - A commitment to the future and adaptation to the new reality
Stage 6 - Creativity and risk-taking that leads to a very different
marketing profile
Note varying approaches to environmental scanning
Irregular systems in which the focus is upon responding to
environmentally generated crises. An emphasis being placed upon finding
solutions to short-term problems with little effort expended on assessing
the impact of future environmental changes.

Periodic models more systematic, resource intensive and often

sophisticated. The environment is reviewed regularly and a longer-term
perspective is developed.
Continuous models which involve focussing upon the business
environment generally and upon the long-term as opposed to specific
short-term issues.
Environmental scanning can aid with the following
Help companies to identify and capitalise upon opportunities rather than
losing out to competitors
Provide a base of objective qualitative information
Makes the company more sensitive to the changing needs of customers
Provide a level of intellectual stimulation for strategists
Improve the image of the company with the public by illustrating that it is
sensitive to the environment
KEY THEMES OF LECTURE
The external environment is all those factors which affect the
organisation, its markets, or the relationship between them. The
organisation has little or no control over these factors but can influence
them.
Appreciating the evolving and diverse nature of the marketing
environment.
Tracing how the elements of the external environment impact on the
organisations approach to business and its flexibility, and considering the
ability of the elements to present threats and opportunities. Also to
recognise the uncontrollable and sometimes unpredictable nature of the
elements.
Recognising that environmental scanning is an important activity if the
organisation is to anticipate change, spot emerging opportunities early
enough to capitalise on them proactively, or spot potential problems early
enough to remedy them before damage.

LECTURE 4 ----- MARKETING INFORMATION AND RESEARCH

Marketing research can be seen as the controlled gathering of nonroutine
marketing information undertaken to help management solve marketing
problems. It is the process of collecting, analysing and presenting useful
information about consumers, users, markets etc.
Many attempts made at categorising types of marketing research --CUSTOMER RESEARCH - facts about markets and market segments,
market trends, market share, market characteristics. It provides
information about where customers live, what they do with their time,
what their motivations are, what their spending power is.
SALES RESEARCH sales analysis, sales forecasting, sales territory
design, sales performance measurement.
PRODUCT/SERVICE RESEARCH new product/service research,
product features, brand image, concept tests, market tests, assessment of
product/service failure, product/service portfolio analysis.
PROMOTION RESEARCH promotion concepts, media research,
measurement of promotion effectiveness.
DISTRIBUTION RESEARCH - tangible and intangible location
research, logistics trends, catchment area studies.
RESEARCH ON CORPORATE GROWTH AND DEVELOPMENT
economic and technological forecasting, corporate planning inputs,
corporate image, profitability measurement, merger and acquisition
studies.
BUT might just categorise between AD HOC RESEARCH and
CONTINUOUS RESEARCH
THE MARKETING RESEARCH PROCESS
RESEARCH PLANNING ---Initial Contact
Research Brief - background information, potential sources of
information, the scale of the project, the likely timetable
Research Proposal statement of objectives, description of the research
design [what will be done], the defined timetable, costs

EXPLORATORY RESEARCH ---Secondary Research internal records, past marketing research reports,
government and overseas bodies statistics, market reports, directories,
newspapers, journals
Qualitative Research focus groups, in-depth interviews
Consultation with Experts business practitioners, academics,
accountants, journalists
Observation watching purchasing behaviour
MAIN QUANTITATIVE DATA COLLECTION ---Descriptive Research descriptions of consumers awareness, beliefs,
attitudes, preferences, behaviour
Experimental Research setting up control procedures to measure cause
and effect
Research Design The Sampling Process definition of population,
sampling frame, sampling method, sample size
The Survey Method personal interviews, telephone
interviews, mail surveys, internet surveys
Questionnaire Design planning, design, piloting
DATA ANALYSIS AND INTERPRETATION ---Various computer packages available for the quantitative analysis of
questionnaire data.
REPORT WRITING AND PRESENTATION
OTHER SIGNIFICANT RESEARCH ISSUES
Note the relative advantages and disadvantages of qualitative and
quantitative research.
Qualitative research advantages can handle complex emotional issues
and can provide rich insights into behavioural issues.
disadvantages can be difficult to design
qualitative research, can be difficult to analyse, and it can be difficult to
validate results.
Quantitative research advantages can be validated, it is a cost efficient
and effective way of dealing with factual data, it can be relatively easy to
make generalisations from the results.
disadvantages it is not so good for exploring
complex emotional issues and the research design might oversimplify
issues in the interests of data coding and analysis.

THE INTERNET AND THE RESEARCH PROCESS

The internet has the ability to impact upon the research process at four
levels through speed and access to information
Micro-environment organisations may be able to source superior goods
and services at better prices from a wider range of potential suppliers than
before, due to the Internets geographic reach. Alternatively competitor
data may be accessed through Companies House websites or retrieval
systems such as FAME, specialising in the accounts of individual
companies.
Macro-environment the internet provides rapid dissemination of
information on social trends, economic data or political and legal issues
through public and private websites such as Inland Revenue websites or
Mintel websites.
Customer Research the internet can provide real-time feedback,
opinions, interests and attitudes via online surveys offered by established
research agencies like NOP or MORI or emerging online survey software
developers. With the growing adoption of the Internet and other digital
devices, there has been a developing shift by leading agencies away from
traditional channels towards online methods of primary research. Also
note secondary sources on the Internet provide valuable customer insight,
especially syndicated data such as those offered by Experian and Claritas
in specific industry sectors such as financial services.
The Marketing Mix whilst the debate continues over the usefulness of
the Mix as a model for marketers in the online world, it still provides a
useful focus for analysis. The internet can be used for research purposes
to get feedback on a new concept such as a new design of vehicle. With
regard to pricing, dynamic pricing software can be used to analyse instant
customer sensitivity to price changes. Testing and analysis is of different
promotional offers can be carried out at greater speed and with greater
tracking precision of the customer.
STRENGTHS AND WEAKNESSES OF ONLINE MARKETING
RESEARCH
Strengths
Speed of accessing information both primary and secondary eg. primary
results can be collected and analysed in one day in some cases as research
software applications become more efficient .
Online marketing research can be extremely cost effective reaching large
numbers of respondents at a fraction of the cost of existing research
methods.

The internet is an effective tool for carrying out exploratory research to

provide background information into sectors, suppliers, distributors and
competitors.
The internet has no geographic boundaries, enabling cross border and
wider international reach.
The quality and quantity of market and company information available
online is evolving rapidly.
Online surveys provide convenience, as they enable respondents to
complete questionnaires in their own time and space.
The increased availability of pre-screened panels will improve data
integrity.
Web metrics provide marketers with greater precision and measurement
of visitor activity .
Multimedia formats eg. video streaming provide opportunities for
concept testing online.
Weaknesses
Serious concerns have been raised that the same sample lists are being
drawn from repeatedly. Consequently, doubts are being cast upon the
validity and integrity of the data generated from such samples.
Dubious reliability of some online sources, especially with regard to
market size and usage statistics particularly in the early stages of internet
development.
Potential online respondents may be difficult to reach as many change email addresses frequently or have separate home and business e-mail
addresses.
The cost attractiveness of the internet for research purposes may drive
organisations to focus more on quantitative research than softer
behavioural qualitative data.
Self-selecting respondents can be unrepresentative of the target
population and produce bias.
Opt-in lists only give permission to question certain people and this can
create sampling bias.
Concept testing of new products is problematic online when senses like
taste, touch and smell are required.
Pure online research removes the human element where a skilled
researcher may be able to tease out more information.
Cultural and language differences may present difficulties in information
gathering across national boundaries.
Availability of a universal sampling frame.

KEY THEMES OF LECTURE

Recognising that marketing research is an essential tool for the marketing
manager in helping to define and locate market segments and understand
their needs and wants. Research helps the manager to develop more
appropriate marketing mixes and to monitor progress and diagnose the
root causes of marketing problems.
Tracing the relationships between research input, the decision taken with
the aid of the research, and measuring the effectiveness of the decision
and its implications.
Understanding how information is acquired and the limitations of that
information.
Specifying the framework for the conduct of a marketing research project
and appreciating the process of managing the project.

LECTURE 5 ----- MARKET SEGMENTATION AND POSITIONING

The aim of segmentation is to target a group of people who have a need
or needs that can be met by a single product/service offering, in order to
concentrate the marketing firms efforts most effectively and
economically. The assumptions underlying segmentation are
Not all buyers are alike
Subgroups of people with similar behaviour, backgrounds, values and
needs can be identified
The subgroups will be smaller and more homogeneous than the market as
a whole
It is easier to satisfy a small group of similar customers than to try to
satisfy large groups of dissimilar customers
Market segmentation is a two-fold process that includes
- identifying and classifying people into homogeneous groupings,
and
- determining which of these segments are viable target markets
In essence, the marketing objectives of segmentation analysis are
- to reduce risk in deciding where, when, how, and to whom a
product, service or brand will be marketed
- to increase marketing efficiency by directing effort specifically
towards the designated segment in a manner consistent with that
segments characteristics
Market segmentation allows the development of differential marketing
strategies the differential advantage may create a competitive
advantage.
Market segmentation is useful when attempting to spot opportunities and
threats. Markets are rarely static. As customers become more affluent,
seek new experiences and develop new values, new segments emerge.
The company that first spots a new under-served market segment and
meets its needs better than the competition can find itself on a sales and
profit growth trajectory.
Advantages of segmentation
Customer Analysis - by segmenting the firm can get to understand its
best customers better.
Competitor Analysis it as much easier to recognise and combat
competition when concentrating on one small part of the overall market.
Effective Resource Allocation companies scarce resources can be
concentrated more effectively on a few consumers, rather than spread
thinly across the masses.

Strategic Marketing Planning - planning becomes easier once the firm

has a clear picture of its best customers.
SEGMENTING CONSUMER MARKETS
BEHAVIOURAL
Benefits Sought versatility, status, safety, convenience etc.
Purchase Occasion self-buy, gift
Purchase Behaviour brand loyalty, brand switching, innovators etc. ie
are highly brand-loyal individuals different from the rest
Usage Rate heavy, light ie are those who consume a lot different from
those who consume a little
Attitudes ie can distinctions be made between groups holding different
attitudes to the product/brand
PSYCHOGRAPHIC
Lifestyle trendsetter, sophisticates, traditionalist etc
Personality extroverts, introverts, aggressive, submissive etc
DEMOGRAPHIC
Age
Gender
Life Cycle young single, young couples, young parents, middle aged
empty nesters, retired.
Education
Family Size
SOCIO-ECONOMIC
Upper-middle, middle, skilled working, unwaged ie is consumption[or
even media exposure] related to social class
Do income levels provide a more sensitive measure than social class
GEOGRAPHIC
National/Regional differences in taste and product usage . Look at
Geodemographics upwardly mobile young families living in larger
owner-occupied houses, older people living in smaller houses, European
regions based on language, income, age profile and location

SEGMENTING INDUSTRIAL/ORGANISATIONAL MARKETS

MACROSEGMENTATION
Organisational Size
Industry
Geographic Location
MICROSEGMENTATION
Choice Criteria value in use, delivery, price, status etc
Decision-making unit structure complex, simple
Decision-making process long, short
Buy class straight rebuy, modified rebuy, new task
Purchasing Organisation centralised, decentralised , specialised
Organisational Innovativeness level of technological development
Note might look at issues such as buyer self-confidence, differences in
buyer information processes, buyer risk tolerance and preference, buyers
working relationship with others, buyers workload, buyer personality
traits etc.
STAGES OF THE SEGMENTATION AND POSITIONING PROCESS
Identify the organisations current position, capabilities, objectives and
constraints
Identify the segmentation variables and segment the markets
Develop profiles of each segment
Evaluate the potential and attractiveness of each segment
Select the target segment
Identify the positioning concept within each target segment
Select and develop the appropriate positioning concepts
Develop the marketing mix strategy
Note a segment must fulfil the following requirements if it is to be
successfully exploited
It must be measurable or definable there must be some way of
identifying the members of the segment and knowing how many of them
there are
It must be accessible this means that it must be possible to
communicate with the segment as a group
It must be substantial that is , big enough to be worth targeting
It must be congruent that is to say the members of the segment must
have a close agreement on their needs

It must be stable the nature and membership of the segment must be

reasonably constant
It must be appropriate to the organisations objectives and resources
NOTE segmentation may be used to
Achieve a better competitive position for existing brands
More effectively position an existing brand by appealing to a limited
market
Separate two or more brands of the same company to minimise
cannibalisation
Identify gaps in the market which represent new product opportunities
Identify potential new buyers for the product
NOTE
The marketer can use his knowledge of different response rates from
different segments to guide his total marketing budget. Different
segments may respond differently to different marketing tools and the
budget or marketing effort should be allocated accordingly
KEY THEMES OF LECTURE
Examining the link between segmentation and marketing success by
noting the impact that effective marketing strategies can have on
engendering customer loyalty and building a strong competitive edge.
Reviewing the criteria for segmentation and their practical use.
Recognising that after choosing its target market segments, the business
has to create a differential advantage. To build that advantage,
management needs to understand what drives customer satisfaction and
what drives the costs of meeting their requirements.
Appreciate the business circumstances which favour adopting particular
segmentation approaches.

LECTURE 6 AND 7 ---- THE MARKETING MIX

Marketings main tasks are centred around identifying and satisfying
customers needs, in order to offer something to the market that has a
competitive edge or differential advantage, making it more attractive than
the competing products.
These tasks are achieved through the use of the marketing mix, a
combination of elements that actually create the offering. For most
physical goods, the mix consists of four elements, product, price, place,
and promotion. For services, the mix can be extended to seven elements
with the addition of people, processes, and physical evidence.
The Product covers everything to do with the creation, development and
management of products. It is about not only what to make, but when to
make it, how to make it, and how to ensure that it has a long and
profitable life. So important to stress New Product Development, Product
Management, Product Features/Benefits, Branding, Packaging, AfterSales Service.
The Price not necessarily a straightforward calculation of costs and
profit margins. Price has to reflect issues of buyer behaviour, because
people judge value in terms of their perceptions of what they are getting
for their money, what else they could have had for their money, and how
much that money met to them in the first place. Pricing also has a longerterm dimension in that it gives messages to all sorts of people in the
market. So important to stress Costs, Profitability, Value for Money,
Competitiveness, Incentives.
The Place concerns the movement of goods through the various
channels of distribution to the eventual customer. So important to stress
Access to Target Market, Channel Structure, Channel Management,
Image of Chosen Channels, Logistics.
The Promotion managing and planning the communication with the
market-place. Consider the different communication techniques available,
the objectives each can best achieve, their relative strengths and
weaknesses, and the kinds of management and planning processes that
have to support them. So important to stress Developing Promotional
Mixes, Advertising Management, Public Relations, Direct Marketing.
The People services often depend on people to perform them, creating
and delivering the product as the customer waits. People add value and a

dimension to the marketing package way beyond the basic product

offering.
The Processes services are manufactured and consumed live, on the
spot, and because they do involve people and the performance of their
skills, consistency can be rather more difficult than with normal
manufacturing.
The Physical Evidence atmosphere, ambience, image and design of
premises can be significant in numerous service situations.
KEY CHARACTERISTICS OF AN EFFECTIVE MARKETING MIX
- the marketing mix matches customer needs sensible mix
decisions can be made only when the target customer / segment
group is understood. Once the decision about the target market/s is
taken, marketing management needs to understand how customers
choose between rival offerings. The starting point is the realisation
that customers evaluate products on economic and psychological
criteria. Economic criteria include factors such as performance,
availability, durability, and productivity gains to be made by using
the product. Examples of psychological criteria are self-image,
pleasure, convenience, and risk reduction. Therefore an analysis of
customer choice criteria will reveal a set of key customer
requirements that must be met in order to succeed in the
marketplace.
- the marketing mix creates a competitive advantage having a clear
performance differential over the competition on factors that are
important to customers.
- the marketing mix should be well blended to form a consistent
theme it is essential that each mix variable should be consistent
with each other. For example, a high quality product should be
supported by high quality distribution and advertising.
- the different markets show different levels of sensitivity to different
marketing mix variables management must identify the most
important variables and ensure that due emphasis is given to these,
with support from the other variables. For example, if the market
is very price-sensitive it may be necessary for the advertising to
stress the price advantages of the product.

- the marketing mix should match corporate resources the choice

of mix strategy may be constrained by the financial resources of
the company, or by the internal competences of the company.
Note other aspects of marketing mix design
- the optimum marketing mix will change over time as the marketing
environment changes.
- the marketing mix will also change over time as the product goes
into different stages of its life cycle.
Given the extensive nature of the work covered under the marketing mix
umbrella, you need to concentrate your reading on the following
- think about the value of the product life cycle in relation to product
policy ie although a considerable amount has been written about
the product life cycle and how it might or should be used,
surprisingly few empirical studies of the concepts real scope for
application within an organisations product policy have been
conducted. Some of the literature argues that life cycle analysis
offers a strong foundation for effective product management, while
other literature dismisses the idea as being conceptually attractive
but pragmatically worthless. The life cycle of a product and hence
the shape of the curve is determined by how the product is
managed over time it is not an independent variable as is
suggested by traditional PLC theory.
- think about approaches to brand development - think carefully
about the links that exist between the different brands owned and
the nature and significance of any overlaps and gaps, and about the
opportunities for brand stretching and extension. A brand extension
[ eg Mars extending its name from chocolate bars to drinks and icecreams ] is the use of an established brand name on a new brand
within the same broad market or product category; brand stretching
occurs when an established brand is used for brands in unrelated
markets or product categories [ eg Cadbury confectionery launched
Cadburys Cream Liqueur ].
- think about the arguments for and against global and panEuropean branding , and the strategic options for building such
brands. The arguments for are that intensified global competition
and technological developments, customer convergence of tastes
and needs, and the prospect of global efficiencies of scale will
encourage companies to create global brands. The arguments
against are that national varieties in taste and consumption
patterns will limit the development of global brands. The strategic

options are geographic extension, brand acquisition, and brand

alliances.
think about the role of new product development its specific role
can be stated as follows ensuring that the product mix matches changing environmental
conditions and that product obsolescence is avoided
enabling the organisation to compete in new and developing
segments of the market
reducing the organisations dependence upon particular elements of
the product range or vulnerable market segments
matching competitive moves
filling excess capacity
achieving greater long-term growth and profit
think about proactive new product strategies and how the company
needs to organise its new product development process. Note the
eight stage process new product strategy, idea generation,
screening, concept testing, business analysis, product development,
market testing, commercialisation, new products.
think about some issues associated with the handling of pricing
decisions in companies. Pricing decisions are often too heavily
biased towards cost structures and do not take sufficient account of
either competitors or customers probable response patterns. Too
little account is taken of the opportunities to capitalise on
differentiation. Prices often do not vary sufficiently greatly
between different segments of the market. Prices often reflect a
defensive rather than an offensive position.
think about how companies decide on their pricing objectives.
Consider the following
ensuring survival when conditions facing the company are
difficult, but note prices are reduced often to levels far below cost
simply to maintain a sufficient flow of cash for working capital.
ensuring an appropriate return on investment.
ensuring market stabilisation.
trying to improve the market position for the company, for example
to gain market share.
meeting or following competition
pricing to reflect product differentiation.
early cash recovery faced with problems of liquidity or a belief
that the life of the product or market is likely to be short, the firm
may opt for a policy designed to generate a high cash flow and lead
to an early recovery of cash.
discouraging others from entering the market this is done by
deliberately setting a low price so that returns are low, whilst

simultaneously sending out signals about a willingness to engage in

a price war with any new entrants.
- think about the need for an integrated marketing communications
programme. By achieving a higher level of integration between the
individual elements of the communications mix, the marketer
should achieve a greater degree of clarity and consistency, with the
result that there will then be a seamless integration of messages and
a correspondingly greater impact in the marketplace.
- think about issues that impact upon channel management such as
the importance of the internet. Consider the increasing importance
of channel power with channel-driven strategies being employed
by an increasing number of companies that seek to develop or
acquire products that can be marketed through their existing
channels. The emergence of database and one-to-one marketing in
recent years has resulted in a huge increase in the use of direct
mail, the telephone, and the Internet as distribution channels.
- think about the main applications of database marketing
direct mail
telemarketing
distributor management systems a database can be the foundation
on which information is provided to distributors and their
performance monitored
loyalty marketing
campaign planning using the database as a foundation for
sending consistent and coordinated campaigns and messages to
individuals and market segments
- think about mobile marketing short messaging services to mobile
phones cost effective and personalised. Also
interactive the receiver can respond to the text message, setting
up the opportunity for two-way dialogue
customer relationship building by establishing an ongoing dialogue
with consumers
time flexible unlike direct mail, mobile marketing can be seen at
various times of the day, giving greater flexibility when trying to
reach the recipient
immediate and measurable the results of the mobile campaign
can be immediate and the results measurable

KEY THEMES OF LECTURE

Reviewing the stages in the formulation of the marketing mix and the
process of determining the optimal mix of the factors to achieve given
marketing objectives.
Appreciating the constraints affecting possible mixes.
Recognising a wide range of theories and concepts and their applicability
in diverse business circumstances.
Defining the links between the marketing mix, market segmentation, and
product/service positioning.
Appreciating the problem in managing and coordinating the mix.

LECTURE 8 ---- RELATIONSHIP MARKETING

Relationship marketing is the ongoing process of identifying and creating
new value with individual customers and then sharing the benefits from
this over a lifetime of association. It involves the understanding,
focussing and management of ongoing collaboration between suppliers
and selected customers for mutual value creation and sharing through
interdependence and organisational alignment.
Relationships predict whether new value will continue to be created and
shared with the company.
The development of relationship marketing points to a major shift in
marketing - competition and conflict to mutual cooperation, and
independence and choice to mutual interdependence.
Relationship marketing emphasises cooperation rather than competition
and consequent conflict among the parties.
It is important to recognise that individuals and organisations operate in
complex networks of interrelated partners and alliances, and understand
the range of stakeholders involved in a supplier-customer relationship.
You could argue that the shift to relationship marketing and the shift in
the balance of power between suppliers and consumers has been caused
bymore intense competition, driven by general oversupply
a general raising of manufacturing quality standards
reduced market growth rates
deregulation
the advent of global competitors
RELATIONSHIP MARKETING PATTERNS
After-Sales Service simplest form of relationship marketing
Locking In this is where organisations build barriers to exit, making it
difficult to change suppliers. For example with regard to banking it is
often difficult to change bank accounts, with long procedures [ which can
be costly if they affect cash flow ] . This is not really relationship
marketing - customers do not stay with the organisation out of loyalty,

but out of inertia. As soon as transfer is made easy for them, they are
likely to go.
Database management some organisations have used advances in
technology to improve the quality of information they hold on customers
in order to improve the offers that are made to them. This is also not
really relationship marketing, because the focus is still on improving
discrete transactions, rather than building a long-term relationship.
Exchange a real relationship involves exchange on both sides. Trust and
empathy are important for the reciprocity that is necessary for a long-term
working relationship between suppliers and customers.
HOWEVER relationship marketing is not risk free .
Relationships may be cost effective, but they are not cost free and often
require an investment of time and personnel to establish and maintain.
Implementation of relationship marketing will require a change of mindset within the organisation difficult to achieve without a basic
acceptance of the strategy. As interpersonal relationships are important to
the partnership, changes of personnel can, if not carefully managed,
endanger the relationship.
Relationships between major players in an industry can have an effect on
overall industry structure which may not be of benefit to the industry as a
whole.
Good relationships require information exchange and it is sometimes a
fine line between the exchange of necessary information and invasion of
customers privacy.
FACTORS INFLUENCING THE PROPENSITY OF A FIRM TO
ENTER INTO STRATEGIC ALLIANCES
Firm characteristics
- product-market diversity of firm
- firms size and resource position
- prior involvement in strategic alliances
- top managements attitudes towards strategic alliances
- corporate culture
Industry characteristics
- minimum efficient scale
- convergence of industries and associated costs of product
development
- importance of speed of entry into market
- cost structure
- threat of new entrants

- threat of competition from substitutes

Environmental characteristics
- changes in buying patterns
- degree of market uncertainty
- rate of technological change
- breadth of competencies, skills, capabilities required to capitalise
on environmental opportunities
- political, legal, and regulatory environment
Note costs of alliances
- time spent by management to negotiate, implement and integrate
the alliance
- loss of flexibility and freedom of action in the areas of joint interest
- leakage of proprietary knowledge to the partner who may use it
later to erode the firms advantage
- atrophying of the firms capabilities in areas of alliance activity
that have been ceded to the partner
Note costs of terminating alliances
- heavy time commitment of management to decide termination
conditions
- opportunity costs
- loss of competitive headstart
- disadvantage if partner emulates the intent of the alliance and
brings it to fruition
KEY ACCOUNT MANAGEMENT
How does an organisation manage its key customers for future security
and profit. High-involvement relationships with key customers offer
major opportunities to increase business and move forward in the market,
and to save costs for both sides. They also require innovation, major
investment and high running costs. An organisations capacity for highcost intimate relationships is limited, so the first crucial decisions must
focus on the selection and prioritisation of key accounts.
Defining Key Customers
At the company level the firm will have to define the criteria it uses to
identify existing and potential accounts that fulfil these criteria now and
in the future.
The criteria can be
Sales volume
Use of strategic resources

Age of the relationship

The suppliers share of the customers purchases
Profitability of the customer to the supplier
Also important are the growth rate of the customers market and the
buyers relative share of the customers purchases. The organisation will
also need to consider risk factors, for example the extent to which the
organisation will become dependent on a single customer and the extent
to which investments sunk into the relationship could be used with other
customers. The higher the extent of the latter the less risk the organisation
is running.
KEY THEMES OF LECTURE
Tracing how relationship marketing has evolved and considering the
different modes of collaboration that organisations are pursuing
Reviewing the process of relationship building
Analysing the benefits to all stakeholders that arise from positive
relationships

LECTURE 9 AND 10 ---- MARKETING PLANNING

Examples of Marketing Planning Frameworks given as separate handout.
Marketing planning is the means by which well-organised companies
bring their marketing activities into a concerted action plan, ready for the
market.
A logical sequence will usually be followed in marketing planning,
commencing with information gathering and analysis, combined with a
marketing audit exercise involving issues and influences both within and
outside the company.
From the audit stage will be developed the marketing objectives to be
addressed, while these in turn will largely direct the strategies to follow
within the plan.
Key assumptions made during the planning exercise need to be made
explicit, as these will have some bearing on the flexibility and scope of
the plan itself.
Finally no marketing plan will be complete without some provision for
implementation, supporting organisation and control.
Think of the following framework for the plan
Stage 1 Where are we starting from the marketing audit, product
range analysis etc
Stage 2 Where do we want to be marketing objectives, strategy
development, targeting and positioning etc
Stage 3 How do we get there evaluation of alternatives, choice,
marketing mix actions, resource allocation etc
Stage 4 How do we ensure we get there control and feedback etc
SIGNIFICANCE OF THE MARKETING AUDIT
Do a Marketing Environment Audit ie look at the macro environment ie
STEEP factors
Look at the Task Environment ie
Markets size, growth, profits, changes in market segment sizes etc
Customers attitudes towards the company, evolving needs and wants etc
Competitors objectives and strategies of competitors, trends in future
competition etc
Distribution and dealers main trade channels, efficiency levels of trade
channels etc
Suppliers availability of key resources etc

Facilitators and marketing firms cost and availability of transport,

finance and warehousing, effectiveness of agencies etc
Do a Marketing Organisation Audit ie structure of marketing
management responsibilities, functional efficiency[communications
systems, product management systems etc], interface
efficiency[connections between marketing and other business functions]
Do a Marketing Systems Audit ie
Marketing Information System accuracy and sufficiency of information,
generation and use of market research etc
Marketing Planning System forecasting, setting of targets etc
Marketing Control System control procedures, periodic analysis of
profitability and costs etc
New Product Development System gathering and screening of ideas,
business analysis, market testing etc
Do a Marketing Productivity Audit ie
Profitability Analysis profitability of each product, market, territory etc
Cost-effective Analysis costs and benefits of marketing activities
Do a Marketing Functions Audit ie product portfolio, pricing strategies,
customer attitudes, adequacy of market coverage, etc
UNDERSTAND STRATEGIC VARIABLES IN COMPETITIVE
SUCCESS
Component of Marketing
Strategy

Variables Relating to Strategy Components

1. Strategic Objectives

Profit Orientation
Steady Growth
Aggressive Growth
Non-users
New Customer Segments
Increased usage of product
Beat competition
Good at segmentation and positioning
Early to market
Effective product differentiation
Large cash resources
Advanced R and D capabilities

2. Strategic Focus

3. Differential Advantage

4. Competitive Position

Very superior quality product

Better product performance
Higher prices
Higher advertising spending
Longer distribution chain
Service much better
Up-market image/positioning
Providing consumer benefits
5. Marketing mix emphasis Product quality
Product design
Innovativeness of product
Promotion
Distribution
Price
PROBLEMS WITH PLANNING
Analysis instead of planning executives frequently see planning as
being overburdened with analytical techniques and models which are far
removed from the reality they perceive and do not lead to practicable
plans.
Information instead of decision executives describe planning as
disintegrating into constant demands for more information.
Incrementalism executives describe many situations where the primary
determinant of a plan is the previous plan, or at least the previous budget.
The planning task can deteriorate into negotiating minor departures from
the previous year rather than creating new strategies.
Vested interests rule executives suggest that powerful people exert
undue influence over plans, to protect budget and head counts, to build
empires etc.
Organisational mind-set many executives suggest that conventional
planning processes are inward-looking and bounded by the way we do
things here.
No ownership or commitment in many cases , plans are produced and
officially accepted but, in the absence of champions determined to make
them work, nothing ever happens as a result of the planning effort.

No resourcing many resource-related pitfalls. There may be a simple

refusal by management to provide resources; plans may be rejected with
the comment that they are unrealistic because it should have been known
all along that resources would not be released.
No implementation there are bitter complaints about situations where
planning absorbed resources and management time, and even created
excitement and support for change, but led to nothing more than a report,
which was never acted on effectively.
All the above can be categorised into three dimensions of the marketing
planning process that organisations need to address- an analytical dimension - how the process is undertaken
- a behavioural dimension - how people at all levels in an
organisation behave so as to facilitate or block the process
- an organisational dimension - how an organisation is structured so
as to facilitate or block the process
KEY THEMES OF LECTURE
Assessing the different types of plan found within organisations
Explain the structure and contents of a marketing plan
Defining the stages in the marketing planning process and their
contribution to sound, integrated plans
Understanding the need for evaluation and control of marketing plans
Appreciating the problems of implementing marketing plans.

PLEASE NOTE in putting together this lecture programme material from

the following texts has been used -Strategic Marketing Management by Richard M. S. Wilson and Colin
Gilligan, published by Elsevier. Third Edition
Essentials of Marketing by Jim Blythe, published by FT Pitman
Publishing.
Marketing Principles and Practice by Denis Adcock, Al Halborg, and
Caroline Ross, published by FT Prentice Hall. Fourth Edition
Principles and Practice of Marketing by David Jobber, published by
McGraw-Hill