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Marketing Management is a business discipline focused on the practical application of marketing techniques and the management of a firm's marketing resources and activities. Marketing managers are often responsible for influencing the level, timing, and composition of customer demand in a manner that will achieve the company's objectives.
New Economy was a term coined in late 1990s by pundits to describe what some thought was an evolution of the United States and other developed countries from an industrial/manufacturing-based wealth producing economy into a service sector wealth consuming asset based economy, with fewer job opportunities for the middle class arising partly from an overvaluation of technology stocks and partly from globalisation and currency manipulation by governnments and their central banks. At the time, some analysts claimed that this change in the economic structure of the United States had created a state of permanent steady growth, low unemployment, and immunity to boom-and-bust macroeconomic cycles. Furthermore, they believed that the change rendered obsolete many business practices. When the stock market bubble burst, analysts soon realized they had been wrong. While many of the more exuberant predictions proved to be wrong, some pundits continue to use the term New Economy to describe contemporary developments in business and the economy.
In the financial markets, the term has been associated with the Dot-com boom. This included the emergence of the NASDAQ as a rival to the New York Stock Exchange, a high rate of IPOs, the rise of Dot-com stocks over established firms, and the prevalent use of such tools as stock options. In the wider economy the term has been associated with practices such as outsourcing, business process outsourcing and business process re-engineering.
The general idea is that a business should focus on those areas of its operation which are critical to its success and where it has a competitive advantage. Other areas of its operation should be outsourced, typically using technology as the facilitator. In a developed economy, the critical success factors to a leading business are likely to be intellectual things such as brands, products specifications and technical capabilities. Many routine business functions (such as manufacturing and customer service desks) may be outsourced.
'Sustainable competitive advantage (SCA) not reach in its competitive landscape. Michael Porter posits that a competitive advantage, sustainable or not, exists when a company makes economic rents, that is, their earnings exceed their costs, especially including cost of capital. That means that normal competitive pressures are not able to drive down the firm's earnings to the point where they cover all costs and just provide minimum sufficient additional return to keep capital invested. Most forms of competitive advantage cannot be sustained for any length of time because the promise of economic rents drives competitiors to duplicate the competitive advantage held by any one firm.
A firm possesses a Sustainable Competitive Advantage when it has value-creating processes and positions that cannot be duplicated or imitated by other firms that lead to the production of above normal rents. An SCA is different from a competitive advantage (CA) in that it provides a long-term advantage that is not easily replicated. But these above-normal rents can attract new entrants who drive down economic rents. A CA is a position a firm attains that lead to above-normal rents or a superior financial performance. The processes and positions that engender such a position is not necessarily non-duplicable or inimitable. It is possible for some companies to make profits for a time above the cost of capital without sustainable competitive advantage.
A key difference between CA and SCA is that the processes and positions a firm may hold are non-duplicable and inimitable when a firm possesses a SCA. Hence a sustainable competitive advantage is one that can be maintained for a significant amount of time even in the presence of competition. This brings us to the question what is a "significant amount of time". A CA becomes SCA when all duplication and imitation efforts have ceased and the rival firms have not been able to create the same value that the said firm is creating.
Planning for SCA in the IT industry
Analysis of the factors of profitability is the subject of numerous theories of strategy including the five forces model pioneered by Michael Porter of the Harvard Business School.
A Value Proposition in business and marketing, is a statement summarizing the customer segment, competitor targets and the core differentiation of one's product from the offerings of competitors. In Crossing the Chasm, Geoffrey Moore writes, "Positioning is the single largest influence on the buying decision". Value propositions are often used in a business model and business plan to describe value added.
A Market is a social arrangement that allows buyers and sellers to discover information and carry out a voluntary exchange of goods or services. It is one of the two key institutions that organize trade, along with the right to own property. Allowing markets to arrive at a pareto efficient outcome is one of the key components of capitalism.
In everyday usage, the word "market" may refer to the location where goods are traded, sometimes known as a marketplace, or to a street market.
Competition is the act of striving against another force for the purpose of achieving dominance or attaining a reward or goal, or out of a biological imperative such as survival. Competition is a term widely used in several fields, including biochemistry, business, ecology, economics, music, politics, and sports. Competition may be between two or more forces, life forms, agents, systems, individuals, or groups, depending on the context in which the term is used.
Competition may yield various results to the participants, including both intrinsic and extrinsic rewards. Some, such as survival advantages, including favorable territory, are intrinsic biological factors that occur as a result of ecological competition between organisms. Others, such as competition in business and politics, involve competition between humans. In addition, extrinsic symbols, such as trophies, plaques, ribbons, prizes, or laudations, may be given to the winner(s). Such symbolic rewards are commonly used wherever the rewards inherent in the competition are primarily intrinsic, such as at human sporting and academic competitions.
The Latin root for the verb "to compete" is "competere" which means "to seek together" or "to strive together" from dictionary.com
Market Segmentation is the process in marketing of dividing a market into distinct subsets (segments) that behave in the same way or have similar needs. Because each segment is fairly homogeneous in their needs and attitudes, they are likely to respond similarly to a given marketing strategy. That is, they are likely to have similar feeling and ideas about a marketing mix comprised of a given product or service, sold at a given price, distributed in a certain way, and promoted in a certain way.
Broadly, markets can be divided according to a number of general criteria, such as by industry or public versus private sector. Small segments are often termed niche markets or specialty markets. However, all segments fall into either consumer or industrial markets. Although it has similar objectives and it overlaps with consumer markets in many ways, the process of Industrial market segmentation is quite different.
The process of segmentation is distinct from targeting (choosing which segments to address) and positioning (designing an appropriate marketing mix for each segment). The overall intent is to identify groups of similar customers and potential customers; to prioritise the groups to address; to understand their behaviour; and to respond with appropriate marketing strategies that satisfy the different preferences of each chosen segment.
The changes are usually minor; they can be merely a change in packaging or also include a change in advertising theme. The physical product need not change, but it could. The major sources of product differentiation are as follows.
Differences in quality or design among output (product)
Ignorance of buyers regarding the essential characteristics and qualities of goods they are purchasing
Pervasive sales promotion activities of sellers and, in particular, advertising
Possibility of developing significant product differentiation through advertising is greatly enhanced for so called “gift goods” or “prestige goods”
Differentiation in the locations of sellers of the same good where the product fills no technical function but rather can satisfy many different sort of personal needs or uses (psychological or physical).
The objective of this strategy is to develop a position that potential customers will see as unique. If your target market sees your product as different from the competitors', you will have more flexibility in developing your marketing mix. A successful product differentiation strategy will move your product from competing based primarily on price to competing on non-price factors (such as product characteristics, distribution strategy, or promotional variables).
Differentiation has been shown to impact firm performance positively both theoretically and empirically. Differentiation primarily impacts performance through two mechanisms:
Reduced price sensitivity: Consumers may become willing to pay a premium price for the differentiating factor/s.
Reducing directness of competition: As the product becomes more different, categorization becomes more difficult and hence draws fewer comparisons with its competition.
Most people would say that the implication of differentiation is the possibility of charging a price premium; however, this is a gross simplification. If customers value the firm's offer, they will be less sensitive to aspects of competing offers; price may not be one of these aspects. Differentiation makes customers in a given segment have a lower sensitivity to other features (non-price) of the product.
The disadvantage of this repositioning is that it usually requires large advertising and production expenditures.
A Brand is a collection of images and ideas representing an economic producer; more specifically, it refers to the concrete symbols such as a name, logo, slogan, and design scheme. Brand recognition and other reactions are created by the accumulation of experiences with the specific product or service, both directly relating to its use, and through the influence of advertising, design, and media commentary. A brand is a symbolic embodiment of all the information connected to a company, product or service. A brand serves to create associations and expectations among products made by a producer. A brand often includes an explicit logo, fonts, color schemes, symbols, sound which may be developed to represent implicit values, ideas, and even personality.
The brand, and "branding" and brand equity have become increasingly important components of culture and the economy, now being described as "cultural accessories and personal philosophies". [1]
In economics and marketing, a Service is the non-material equivalent of a good. Service provision has been defined as an economic activity that does not result in ownership, and this is what differentiates it from providing physical goods. It is claimed to be a process that creates benefits by facilitating either a change in customers, a change in their physical possessions, or a change in their intangible assets.
By supplying some level of skill, ingenuity, and experience, providers of a service participate in an economy without the restrictions of carrying stock (inventory) or the need to concern themselves with bulky raw materials. On the other hand, their investment in expertise does require marketing and upgrading in the face of competition which has equally few physical restrictions.
Pricing is the manual or automatic process of applying prices to purchase and sales orders based on factors such as: a fixed amount, quantity break, promotion or sales campaign, specific vendor quote, price prevailing on entry, shipment or invoice date, combination of multiple orders or lines, and many others. Automated systems require more setup and maintenance but may prevent pricing errors.
Distribution is one of the four aspects of marketing. A distributor is the middleman between the manufacturer and retailer. After a product is manufactured by a supplier/factory, it is typically stored in the distributor's warehouse. The product is then sold to retailers or customers. The other three parts of the marketing mix are product management, pricing, and promotion.
Retailing consists of the sale of goods/merchandise for personal or household consumption either from a fixed location such as a department store or kiosk, or from a fixed location and related subordinated services.[1] In commerce, a retailer buys goods or products in large quantities from manufacturers or importers, either directly or through a wholesaler, and then sells individual items or small quantities to the general public or end user customers, usually in a shop, also called a store. Retailers are at the end of the supply chain. Marketers see retailing as part of their overall distribution strategy.
Shops may be on residential streets, or in shopping streets with little or no houses, or in a shopping center. Shopping streets may or may not be for pedestrians only. Sometimes a shopping street has a partial or full roof to protect customers from precipitation. On-line retailing (e-commerce) is the latest form of non-shop retailing (cf. mail order).
Shopping generally refers to the act of buying products. Sometimes this is done to obtain necessities such as food and clothing, sometimes it is done as a recreational activity. Recreational shopping often involves window shopping (just looking, not buying) and browsing and does not always result in a purchase.
Integrated marketing communication is defined as a holistic approach to promote buying and selling in the digital economy. This concept includes many online and offline marketing channels. Online marketing channels include any e-marketing campaigns or programs, from search engine optimization (SEO), pay-per-click, affiliate, email, banner to latest web related channels for webinar, blog, RSS, podcast, and Internet TV. Offline marketing channels are traditional print (newspaper, magazine), mail order, public relation, billboard, radio, and television.
A successful integrated marketing communication plan will customize what is needed for the client based on time, budget and resources to reach target or goals. Small business can start an integrated marketing communication plan on a small budget using a website, email and SEO. Large corporation can start an integrated marketing communication plan on a large budget using print, mail order, radio, TV plus many other online ad campaigns.
Some other creative marketing communication methods include: social marketing and green marketing may enhance or facilitate the marketing process of building relationship among stakeholders (customers, employees, suppliers, partners, communities, shareholders).
Sales, or the activity of selling, forms an integral part of commercial activity. It could be argued that it is the cornerstone of business as it is the meeting of buyers and sellers and all other areas of business has the goal of making that meeting successful. Mastering sales is considered by many as some sort of persuading "art". On the contrary, the methodological approach of selling refers to it as a systematic process of repetitive and measurable milestones, by which a salesperson relates his offering enabling the buyer to visualize how to achieve his goal in an economic way.
`Selling' is the heart beat of any business. No business can function without professional sales people. Dubious selling practices may occasionally result in a sale if the customer is particularly gullible. But it is arguable that, even then, only good marketing, great quality of product along with sales follow up (which encompasses a far wider range of skills, with an almost diametrically opposed motivation) 'will lead the customer to buy again from the same company '. Organizations seldom profit from single purchases made by first-time customers. Normally they rely on repeat business to generate the profit that they need.[1]. However, there are some industries which have a business model based on one time only sales relationship. These tend to be the sale of very expensive, unusual household products such as houses and new and used cars.
The economic reason for this behaviour is that these items are usually unique. A customer is buying a product because of that product's features and benefits along with their emotional attachment or feeling about the product. These can be slightly influenced by the salesperson, however, the sales person knows that the same item cannot be resold to the same customer again at a later date. They also know that the customer is unlikely to buy a similar product for a long time, and so has no incentive to offer any extra quality of service to encourage a long-term relationship. This behaviour is generally true only of business-to-consumer sales. Business-to-business sales are much more relationship based owing to the lack of emotional attachment to the products in question.
Selling is a practical implementation of marketing; it often forms a separate grouping in a corporate structure, employing separate specialist operatives known as salesmen (singular: salesman or salesperson).
The successful questioning to understand a customer's goal, the further creation of a valuable solution by communicating the necessary information that encourages a buyer to achieve his goal at an economic cost is the responsibility of the sales person or the sales engine (e.g. internet, vending machine etc).
The primary function of professional sales is to generate and close leads, educate prospects, fill needs and satisfy wants of consumers appropriately, and therefore turn prospective customers into actual ones.
Various sales strategies exist, such as tit-for-tat which is best if ongoing dealings and interactions are expected. This insight is behind so-called consultative sales process which are used by Saturn to sell cars, as well as for some direct Business-to-Business sales.
Several types of sales exist including direct, consultative, and complex sales. Complex sales varies from other types in that the customer plays a more pro-active role, often requiring proposal response to their Request for Proposal (RFP).
Tesco plc is a United Kingdom-based international grocery and general merchandising retail chain. It is the largest British retailer by both global sales and domestic market share, is the world's third-largest grocery retailer,[1] and is the fourth-largest retailer behind Wal-Mart of the United States, Carrefour of France, and The Home Depot of the United States.[2]
