This Blog post will document my investigation and research surround the question
‘What is marketing?’
In the previous blog post ‘Commercial aspect of Product Design’ an outline of my current level of understanding was given. It is with an open mind and sceptical eye that I step forward into the ‘creative side of business’ and the ‘business side of creative’ that is marketing.
Marketing can be defined with various terms dependant on who you are reading; Drummond, Ensor, and Ashford (2001, p1) state: “the concept of marketing is inherently simple - business success via a process of understanding and meeting customer needs”. Kotler, Armstrong, and Harris (2013, p29) expand on the term process in their definition: “Marketing is the process by which companies create value for customers and build strong customer relationships in order to capture value from customers in return.” Kotler et al here highlight the two-way value relationship required for successful marketing. Dibb and Simkin (2008, p1) define this two-way relationship as an exchange relationship. Dibb and Simkin also elaborate on the varied application of the marketing process in their definition: “Individual and organisational activities that facilitate and expedite satisfying exchange relationships in a dynamic environment through the creation, distribution, promotion and pricing of goods, service and ideas.”
These definitions show marketing is all about relationships. Making business decisions with the customer in mind. Creating a process/plan that speeds up the company progress towards their desired end goals.
For me a company who have customer relationships at the forefront of their marketing process is Orange. Orange customers can get 241 on cinema tickets significant discounts on bills, by staying loyal at their renewal date, which makes customers feel valued. Orange also uses the cinema as an engaging advertising opportunity to reach customers across the country.
Rather than going straight into ‘The strategic perspective’ as Drummond, Ensor and Ashford (2001) layout in ‘strategic marketing’, Kotler and Armstong (20130) introduce the 5 steps in the marketing process in their book Principles of Marketing, which I feel is a great place to start my journey.
Step 1) Understand the market place and what the customers' wants and needs are.
Needs – States of felt deprivation.
Wants - The form human needs take as they are shaped by culture and individual personality.
Demands - Human wants that are backed by buying power. (Kotler, Armstrong, and Harris 2013, p6)
Wants and needs aren’t the same. Needs occur when you are out of something – food or clothing and they are not brand specific. Wants are real ‘products’, for example - I need food, but I want a subway. You may want several products but only buy one. this is what marketers are interested in – where you spend your money.
Step 2) Create a strategy or long term plan for reaching the market.
Across many organisations making strategic decisions that are proactive at addressing issues such as customers, competitors and market trends can be adopted as a business philosophy. "here the organisation adopts a marketing orientation - success by a process of understanding and meeting customer need. basically the companies orientation defines its fundamental business philosophy" (Drummond, Ensor, and Ashford, 2001, p9). It is apparent that all agree the makreting strategy should be ‘customer driven’. To become customer driven, a sincere focus on the customers must be at the heart of the business. However, not everyone agrees on the philosophy that will guide these marketing strategies.
Despite market orientations now being widely established as the primary route to success some organisations design and carry out their marketing strategies with alternative concepts. Below are the five alternatives:
Production concept / production orientation – THis stratrgy holds that "business success is attributed to efficient production" (Drummond, Ensor, and Ashford, 2001, p9) attributing success to efficient production could still be a useful stratrgy in some situations. If a business is within a very price sensitive markets creating affordable available products after highly competitive price. Being one of the oldest orientations that guides Selers, a good example is; Henry Ford’s Model As and Ts, which only came in one colour - Black. This strategy would not work today in my business, as availability is no longer a barrier to sales, due to the digital marketplace.
Product Concept / product orientation - the product concept holds that product innovation and design will attract customers. The most important parts of their marketing strategy are product quality and improvement. Following a product orientation is a dangerous root drummond, Ensor and Ashford (2001, p9) state. with the danger of leading to 'marketing myopia' adds Kotler, Armstrong and Harris (2013, p10) Marketing myopia can happen when a business pays more attention to the product itself rather than the experience and benefits the product produces.
With the rise of such platforms as kicks starter, a relatively low cost low risk option of having a product concepts / product orientation strategy is now available.
It could also be said that sometimes people don't know about the new technology or the new innovation to tell you they want it. Who would've thought the world needed another hoover? Dyson's cyclonic vacuum cleaners were a product of his view "engineering must be considered ahead of form" (Parsons, 2009, p. 8) the world did not need another hoover however Dyson had engineered something brilliant.
This is very appealing orientation for me as a product designer. Maybe this would be my orientation at the start of my business, as having the company focus on product innovation and design will attract the customers I want. Customers with a designer eye, looking to something new original and unique. I believe my loyal customers Will pride themselves in having something nobody else has.
With a customer centred approach, the ‘marketing concept’ suggests a strategy of sense and respond to your target markets wants and needs. This strategy is popular with marketers "market orientations ... often seen as the holy grail of marketers" (Drummond, Ensor, and Ashford, 2001, p10). Rather than having a product and trying to find the customers, the Marketing concept is to find the right product for your customer. The marketing concept takes an 'outside-in' perspective: you find your market, you understand their needs, integrate within the markets and then you focus on your profitable customer satisfaction. I am concerned about this focus on customers. what if they don't know what they want or what is possible for that matter?
Selling concept / sales orientation: the selling concept holds, that they will not sell products unless undertaking a large-scale selling and promotion effort. The selling concept is often used when the product is unknown to the customer. Kotler, Armstrong and Harris (2013, p10) warn that assuming customers are able to be coaxed into buying a product and then like it, is dangerous. Drummonds, Edensor and Ashford (2001, p10) also add, having a dominant short-term perspective can lead to a aggressive selling and a disregard for the longer term relationships.
For me the selling concept is everything I had originally expected from marketing. I will not be taking the sales orientation with my marketing plan, as I feel when you're bullied into a purchase, you often resent the process and therefore would not buy again. Long-term relationships and customer satisfaction Will be significantly harder if a business follow this stratrgy.
A much more popular strategy in todays marketplace, which is in-keeping with an increased concern about the environment and societies’ rising standards on ethics is the ‘Societal concept’. The ethical marketing approach is an emerging trend and an effective strategy. A company that have a societal concept strategy at the forefront of their marketing is Tom’s. Tom’s one for one promise is bulit on a "business philosophy rooted in the concept of Giving. With every product our customer purchases, TOMS helps a person in need. One for One®" (TOMS, no date). Buting a pair of toms gives customers a feeling of greater good when making a purchase, knowing they are giving while also receiving.
Step 3) Prepare a strategy / prepare a marketing plan.
Using the industry agreed approach of ‘the 4 P’s’, which enables you to create a strategy upon which you can build your offerings.
An example of these steps in action is the apple’s ipod, which has had a significant impact on how we listen to music. All key elements of the four P’s are evident here.
Step 4) Build profitable customer relationships
As previously discussed, ensuring value delivery and customer satisfaction are of the upmost importance in marketing. It is within these two areas where marketers and customers interact and the plan and strategy is implemented.
Marketers are trying to understand how you perceive value and satisfaction. They are trying to see things from the customer’s side, which will enable them to understand any mistakes and then better correct them.
Many customer driven companies have customer relation managers, some companies have been know to take customer into the company in an attempt to fully understand from a customers point of view.
An example of a customer relation’s team doing well can be seen in Airbnb. A recent trip to Milan highlighted the value of a successful customer relation’s manager, and how they can affect feelings of satisfaction and value. Due to a cancelation I was left feeling, devalued and with little or not trust in the company. Airbnb, had a 247 team available on online chat, they also assigned a team member to my case, refunded with 20% extra to allow for increase in cost and were very apologetic throughout. I was left feeling satisfied and aware this was a one off they did not accept.
Some companies have carried customer relation management to the point where customers have become partners. This is one-way partnerships can occur; I would love to tell my favourite company how I want my product made. Another example of this is partnership relationship management. Here partners participate in each other’s strategies and plans. For example: Dell and Intel both advertise the valuable element of their relationship.
Step 5) Customers to return value to your company.
Loyal customers are worth investing in and growing. At this point marketers spend time gaining a stronger share of customer rather than market share. Ensuring their customer equity will be maximised brings you back to point 1, kowing what your customer wants and needs and ensuring they want more of it.
Also at this point it is about finding the profitable customers (they are usually a few) and focus of growing these relationships. It is ok to get rid of the non profitable customers says Kotler, Armstrong, and Harris (2013, p29) let the none profitable customers go to your competitors!
Along side a strategic plan and a comprehensive understanding of your customers wants and needs, it is important to keep an eye on marketing trends. Trends are like pathways to success if you can get on board at the right time.
The combined technology and information explosion of the ‘digital age’ has produced dramatic changes to marketing decisions over the last 5-10 years.
Having a website, twitter account or facebook page are essential tools in a marketers armoury.
With the increase of ‘globalisation’ boundaries to business are vanishing, enabling business to take place anytime anywhere.
Our concerns for ‘ethical and social responsibilities’ are pushing standards higher and higher. Tom’s are a perfect example of a company capitalising on this trend.
‘Not for profit marketing’ is an expanding trend within governments.
New marketing relationships are appearing where they didn’t exist before.
In summary of this blog post, to successfully market my product I must satisfy the customer’s needs, which will involve the product performing in relation to the customer’s expectations. Irrespective of the innovative nature of your product or service, for customers to buy your product, they need to know about its existence. This process is called marketing. Having Marketing is an essential management function needed to create a demand for your product. (Cyr and Gray, 2009, pp. 1)
Drummond, G., Ensor, J. and Ashford, R. (2001) Strategic marketing: planning and control. 2nd edn. Oxford: Butterworth-Heinemann
Kotler, P., Armstrong, G. and Harris, L. (2013) Principles of marketing. Harlow: Financial Times, Prentice Hall
Cyr, D. and Gray, D. (2009) Marketing Your Product (101 for Small Business). 5th edn. Canada: Self-Counsel Press
TOMS (no date) TOMS: One for One. Available at: http://www.toms.co.uk/beyond-one-for-one (Accessed: 1 May 2015)