Marketing consists of three fundamental stages. In the first stage of marketing, we conduct analysis. Three types of analysis should be performed: Analysis of customers, competitors, and the company marketing the product. After analysis, the next step is to make decisions about objectives. In marketing, this consists of deciding which customer segments to target and what is a sustainable and differentiable position to have in the minds of customers. Lastly the third and final stage, the marketing mix is used, also known as the 4 P’s (product, price, promotion, and place – otherwise known as distribution) to bring about the proper positioning of the product. ()
Kotler et al. (1999) states that the marketing concept is a philosophy that the organisation can use to achieve goals in a way that is more effective than competitors in combining marketing activities that determine and satisfy the needs and wants of the target markets. It is about meeting the customer’s needs but at the same time achieving the company’s goals. The marketing concept consists of four parts; target market, customer needs, integrated marketing and profitability. It starts with a well defined market, focuses on customer needs, integrates all the activities that will affect customers, and produces profits by satisfying customers. (Kotler, 1997)
The marketing concept can aid small and medium enterprises (SMEs) greatly by following the four points above. (SMEs are businesses with fewer than 250 employees.) They create a basis for the businesses to work off and focus on. The importance of SMEs having a target market is the fact that no business can operate in every market, satisfy every need and do a good job of it especially if it is only small as resources are more limited, then the needs of the customer’s should be identified specifically as not all customers in the same market segment need and want the same things. Determining the customers desires is extremely vital and the customer should be responded to by having their needs or wants fulfilled, but the crucial aspect to successful marketing is to appreciate the customers true needs and meet them better than any competitor can. Integrated marketing is when all of the company’s departments working together to serve the customers interests. It is thought by Kotler (1997) that marketing as a department on its own dose not work. It involves teamwork throughout the company. To a certain extent it is easy for a SME to communicate to all its employees what the customer wants and for the business to work as a whole as there are fewer employees as apposed to a larger business, so this point in particular is very achievable. Last of all and most importantly to businesses; the goals must be accomplished in a profitable way. This may prevent the problem for SMEs when they are competing against other businesses, as they may not be able to contend with larger businesses on price, although an SME may be able to provide a more personal service that some customers are prepared to pay for.
The marketing concept encourages SMEs to ask the right questions by making them think about the future and what the customer wants from it. It also assists in the incorporation of the businesses activities and presents a customer orientation front throughout it. The synchronization of the marketing activities also prevents unnecessary delays and extra costs. (Adcock et. al., 1995) To achieve successful execution of the marketing concept, SMEs must focus on how best to access and concentrate the knowledge and understanding, the motivation, the inspiration and the imagination of all staff to deliver products and services that meet exactly what the customer requires. Being able to relate to the customer enables businesses to build up long-lasting relationships, which in the long run is more profitable than brief dealings. “It might cost sixteen times as much to bring the new customer to the same level of profitability as the lost customer.” (Kotler, 1997) Keeping hold of customers is more important than attracting customers and it is achieved by maintaining the customers satisfaction.
Although evidence that suggests that SMEs lack marketing expertise and focus, there may be significant reasons why this is so. It may be due to a shortage of resources in comparison with larger companies, smaller companies may not have the additional resources and possibly will have to focus the fewer resources they do have on other aspects of the job. Also marketing can be expensive and finances may be limited.
Conclusively, SMEs using the marketing concept are at an advantage to competitors not using it as they are recognising that customers are price less and without them the business is nothing. Therefore the company knows that customers need to be attracted and then it is necessary to work towards build up enduring relationships which is achieved by offering something that the competition doesn’t, for example a personalised service in which employees recognise the customer and know details of their intentions. All departments affect the level of customer satisfaction and again this is advantageous to SMEs as they most likely have better communication between employees, as there are less of them in comparison to larger companies.
Bibliography
Adcock, D., Bradfield, R., Marketing Principles & Practice 2nd Ed.
Halborg, A., Ross, C. London: Pitman Publishing
1995
Hall, D., Jones, R., and Raffo, C. Business Studies. 2nd Ed. Eds. (1999) Ormskirk: Causeway Press
Kotler, P. Marketing management 9th Ed.
1997 London: Prentice-Hall
Kotler, P., Armstrong, G. Principles of marketing 7th Ed.
1996 London: Prentice-Hall
Kotler, P., Armstrong, G., Principles of Marketing 2nd Ed.
Saunders, J., Wong, V. London: Prentice-Hall
1999
Weiss, A. What is marketing?
07/01/03 (Updated) () 08/01/03 (accessed)
