Peter Drucker
In theories we studied that Marketing is a long and continuous process which starts from Market research, goes on to search for new opportunities and then gives a direction to the evolving strategies. Then Marketers design a STP strategy.
Segmentation: The Company divides a broad target market into subsets of consumers who have common needs and applications for the relevant goods and services.
Targeting: They identify a target market which is a group of customers that the business has decided to aim its marketing efforts.
Positioning: In this process marketers try to create an image or identity of its product, brand etc. in the minds of their target market.
Then keeping in mind all these they design marketing mix i.e. four P’s: Product, Price, Place and Promotion. And also additional 3 P’s People, Process and Physical evidences
Then they roll out the product and related campaign and if something goes wrong then marketers look back and analyze what went wrong.
For instance one of the big reasons why Apple IPhone didn’t work well in India when it was introduced in 2008 was that it was priced very high and for a phone which offers no new features except the touch screen. Priced at Rs31000 for 8GB and Rs36100 for 16GB most of the phone buyers felt it’s not worth it.
But market dynamics have changed and narrowed down the above scope of marketing now. One of the deadly ‘Sins’ that companies commit is that they limit marketing efforts to Sales and advertisements.
Philip Kotler shared an experience in his book “TEN DEADLY MARKETING SINS”, once he asked Marketing Vice President of a major European airline some questions:
Whether he sets the fares Price? He said no finance department does that.
Do you influence the food served on the airplane (Process)? He replied no catering does that.
Do you set a standard in hiring cabin crew (People)? He replied no Human resource does that.
Then what do you do? He replied sales and promotion.
Marketing is not simply a part of a business which could be run in isolation but it runs parallel to all the other activities of business. Suppose you are in service industry then your marketing effort should comprise and keep in mind each and process of business, be it HR, Operations etc.
No customer will remain loyal to the Airtel if they do not provide effective services, no matter how much they spent in their promotional activities.
So if you want to be successful you have to integrate marketing in the core of your business.
For instance Tata Nano was a new innovation, they spent a huge money on promotions, price was kept at a level that it could attract a huge customer base, all equation were just right but it did not do as well as it was expected the main reason were production delay, waiting list etc. so even though there marketing mix were good and to large extent coherent to each other they were not backed by the other processes.
Bottom line: Today’s market is very dicey, people have excess to all the info, they always demand more and in this competitive area no process of business can run in isolation and marketing efforts should be backed by all other processes of a business.
By:
Rohit Goyal
Team Mercatus Mantra
Segmentation: The Company divides a broad target market into subsets of consumers who have common needs and applications for the relevant goods and services.
Targeting: They identify a target market which is a group of customers that the business has decided to aim its marketing efforts.
Positioning: In this process marketers try to create an image or identity of its product, brand etc. in the minds of their target market.
Then keeping in mind all these they design marketing mix i.e. four P’s: Product, Price, Place and Promotion. And also additional 3 P’s People, Process and Physical evidences
Then they roll out the product and related campaign and if something goes wrong then marketers look back and analyze what went wrong.
For instance one of the big reasons why Apple IPhone didn’t work well in India when it was introduced in 2008 was that it was priced very high and for a phone which offers no new features except the touch screen. Priced at Rs31000 for 8GB and Rs36100 for 16GB most of the phone buyers felt it’s not worth it.
But market dynamics have changed and narrowed down the above scope of marketing now. One of the deadly ‘Sins’ that companies commit is that they limit marketing efforts to Sales and advertisements.
Philip Kotler shared an experience in his book “TEN DEADLY MARKETING SINS”, once he asked Marketing Vice President of a major European airline some questions:
Whether he sets the fares Price? He said no finance department does that.
Do you influence the food served on the airplane (Process)? He replied no catering does that.
Do you set a standard in hiring cabin crew (People)? He replied no Human resource does that.
Then what do you do? He replied sales and promotion.
Marketing is not simply a part of a business which could be run in isolation but it runs parallel to all the other activities of business. Suppose you are in service industry then your marketing effort should comprise and keep in mind each and process of business, be it HR, Operations etc.
No customer will remain loyal to the Airtel if they do not provide effective services, no matter how much they spent in their promotional activities.
So if you want to be successful you have to integrate marketing in the core of your business.
For instance Tata Nano was a new innovation, they spent a huge money on promotions, price was kept at a level that it could attract a huge customer base, all equation were just right but it did not do as well as it was expected the main reason were production delay, waiting list etc. so even though there marketing mix were good and to large extent coherent to each other they were not backed by the other processes.
Bottom line: Today’s market is very dicey, people have excess to all the info, they always demand more and in this competitive area no process of business can run in isolation and marketing efforts should be backed by all other processes of a business.
By:
Rohit Goyal
Team Mercatus Mantra
Instead of broadening the array of functions included in marketing, can't we make it a specialized process of putting the product to the customer and include all such activities that form a part of selling, promotion, advertising, creating an image of a product, maintaining it and becoming the eyes, ears and mouth(the whole face so to say) of the business that the customers see... If we have to include production, human resource etc into the ambit of Marketing then aren't we undermining their individual importance and confusing the Holistic Business Functioning that is decentralized in action and centralized in motive with an unnecessary umbrella terminology of Marketing which covers each one of them. Its better to say that marketing backed by a required standard performance of every other function is necessary for the business and its marketing to succeed in the long run. There is inter-dependency but still every function is distinct. Complications of terminology are to be avoided.
ReplyDeleteRohit I agree that every process of business has its individual importance, but every marketer should also have a reasonable understanding and control on each and every process,lets take an example of Airtel, for a laymen its a telecom company but, the main process that Airtel handles is its marketing and they outsource rest of the process, in this way they are getting the best that is available, and also able to inline there marketing strategy with all the other processes...
ReplyDeleteAs Philip Kotler says marketing should not concentrate too much on selling but on designing a product that don't need selling..
I feel that keeping marketing as the core the rest of the functions should revolve around it and not the other way round. If a marketeer is not given the control of the integral functions in the process then there is no use for him, keeping in mind the holistic goals of the business the role of the marketing function should not be just promotion and selling but also in the process to decide upon what is right and what is wrong in process to sell a product.
ReplyDeleteIf rightly said marketing is one function which brings the bread and butter to any organisation so the other functions should align themselves to it to support it and that is why they are called as Support Functions in any organisation
I don't think the other functions can be called Support Functions because even though Marketing brings the bread and butter to the organization but for marketing to work there is a whole host of several other functions that are entirely different from marketing and that also need to work equally well for the business to get its act together. There is interdependence if functions with varying degrees of importance. A marketeer should have reasonable control over every other function because ultimately he has to go out and face the customers and earn the bread for the company and hence he should have a say in designing and business process decisions that bring about the finished product and deal with its after sale services but that would be a part of the business function as a whole and not just Marketing. We are in the danger of confusing Business with Marketing if I am to go by your way of thought. This can be best applicable in Oil Marketing companies which are given that name because Marketing is their core business process but the same cannot be said about Reliance that has an established set of processes with procurement of orders, refining and manufacturing as its core business process and marketing playing second fiddle to them.
ReplyDeleteThe safest possible explanation can be that every other function should align itself with the ultimate marketing goals because that is how you are going to sell and make profits. But if we say that a Marketeer doesn't know what food is served on his airline, is stupid because he doesn't know his core business process(how the airline is operated) in and out, different story!
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ReplyDeleteRohit I think we all are thinking in the same direction, the bottom line is marketing cannot be done in isolation, allow me to quote one more example LUXE Concierge provides a no. of services which helps individual to manage a no. of personal tasks. There punch line is "Think of us as your personal assistant; whether you are a busy professional, a small business owner, or someone who lacks time, we can accomplish any task or provide any solution you require". This kind of positioning requires a huge support from other business functions. If you get to read today's ET a business man from Delhi called them an asked for 'Sand from dead sea' and they actually delivered that, they could have not deliver it had they didnot had a support from there operations and could have lost all of there positioning .. So to run a successful business this level of commitment is required.
ReplyDeleteThe difference of opinion is arising because of the identity and distinctiveness given to each function and narrowing the ambit of marketing to being the face of the business.. both others and marketing need to have mutual understanding, co-ordination and orientation but still they are different functions.. Ultimately every activity is equally important and Interrelated.
ReplyDeleteThe ultimate goal of every business is making profit,and customer satisfaction.To achieve that there has to be a sufficient demand for product and services.Other business functions like HR and Finance wont really matter if the demand is not there.You can have a skilled workforce and a quality product but then also sales figure are low(Apple Iphone).That is where Marketing comes into play.Customers are the leading factor for any company.So Marketing today has become an emotional research that helps in understanding the psychology of customers so that the services are designed accordingly.I see Marketing at the core of the firm and other business functions revolving around it.
ReplyDeletei don't think we can generalize.. it depends from business to business.. for a R&D company if it can develop a technology that is good enough then it doesn't need extensive marketing.. the core business process for the business is the most important thing around which everything revolves.. marketing is definitely the bread bringer but has to be backed by other equally important activities.. if you don't have a marketable product then what will you sell.. The importance of each function varies with the nature of the business..
ReplyDeleteits the meaning of marketing which change from business to business but not its important... for some innovative company marketing mean more of informing customer...what new in the product.. how it can help them... what additional are they providing... until people don't know what new...your R&D is of no use... and remember marketing is not only forward process but its a cycle... marketeers should also understand requirement of customer so that product can be design according to their need...
ReplyDeleteas far as apple is concern... they are among the best marketing companies... as far as their failure in India is concern... Indian was never their marketing.. they clearly announced they are not making any strategy for India ..
I think we are circumlocuting and coming back to the same point again and again on which we all agree... the difference is that we need to understand that marketing is undoubtedly one of the 4 most important pillars of the business.. the rest being production, HR and Finance.. everything depends on the kind of company we are talking about. Without production there cant be any marketing and without marketing whatever we produce makes no sense.. but we can't rate in the order of importance.. we can't generalize..
ReplyDelete@Rohit the objective of this article was not comparing importance of various "pillars of business" but to understand what exactly marketing is, because many of us confuse it with advertising and sells but actually it is a process which starts even before product actually come into existence, companies like HUL, Dr. Reddys, and many more do extensive market research to test the market potential of the product, we are living in an era of customer driven marketing, where company doesn't just produce produce something then sell but, firms produces exactly what customer wants.
ReplyDeleteI understand what the article is all about but I felt that other functions were being undermined so i argued with that perspective... your point on marketing and selling is fully agreed to.. adding to that I would even say that if there are pillars of a business.. marketing is also like a beam that joins the pillars and reinforces the objectives and values for which the business exists at all stages, guiding it in the desired direction.. Selling is a subset of marketing..
ReplyDelete