Full Time MBA

Module: Strategic Marketing

Lecturer: Muditha Cooray

Deadline: 13 January 2003

Word count: 2932

“The current trend within marketing seems to focus upon developing consumer relationships through building sustainable brand equity. Therefore, I fear that global marketing is being reduced to clever interactive marketing communications” Discuss using examples from at least one industry sector.

GUO WEILIN

10/01/2003

[email protected]

Contents

1        Introduction        1

2        Marketing and the changing role of marketing        2

2.1        What is marketing?        2

2.2        The changing role of marketing        3

3        Develop consumer relationships through building sustainable brand equity        4

3.1        What is brand?        4

3.2        What is brand equity?        5

3.3        How to build and manage brand equity?        6

3.4        The importance of brand equity        8

3.5        Brand equity - the bridge to connect consumers and organisations        9

4        Is today’s global marketing being reduced to clever interactive marketing communications?        11

5        Conclusion        14

6        Bibliography        15

1        Introduction

Today’s world is characterized by changes and uncertainties given the exponential advancement of technology and deregulation, paralleled with globalisation, complexity and turbulence. Within this picture, the philosophies of marketing are changing accordingly, i.e. from product-oriented to consumer-oriented. Thus, building brand equity which coincides with the changing trend of marketing is emphasized. Under such circumstances, someone argues that global marketing is being reduced to clever interactive marketing communications.

The purpose of this paper is in an attempt to analyse the relationship between current trend of marketing and brand equity and then trying to discuss whether global marketing is being reduced to clever interactive marketing communications.

The paper is organised in the following way. First, definition of marketing and the changing role of marketing are presented. Then, building and managing brand equity, as well as its importance are discussed. Following these, the paper analyses the relationships between current trend of marketing, building sustainable brand equity and marketing communications. Finally, in conclusion, a strategic view on marketing is presented.

2        Marketing and the changing role of marketing

2.1        What is marketing?

There are two popular and widely accepted definitions of marketing:

Marketing is the management process which identifies, anticipates, and supplies customer requirements efficiently and profitably. (CIM)

Marketing is the process of planning and executing the conception, pricing, promotion and distribution of ideas, goods and services to create exchange and satisfy individual and organizational objectives. (AMA, 1985)

(Brassington and Pettitt 2000: 5)

Another definition “… does not list the activities that marketers undertake, but instead is more concerned with partnership idea, the concept that marketing is about doing something with someone, not doing something to them (Brassington and Pettitt 2000: 10).”

Marketing is to establish, maintain and enhance long term customer relationships at a profit, so that the objectives of the parties involved are met. This is done by mutual exchange and fulfilment of promises.

(Gronroos 1990 in Brassington and Pettitt 2000: 10)

The main difference between these three definitions is that the last one puts more emphasis on relationship between customers and organisations, i.e. emphasise the mutually active role between sellers and buyers.

2.2        The changing role of marketing

The market situation is changing from industrial society to postindustrial society. From customers’ perspective, they expect higher quality goods and services with reasonable price and at the same time most of them no longer want to be anonymous and want individual treatment and they are becoming more sophisticated. Dell computer, which provides platforms on which each customer can customises the features he or she desires in the computer, is a successful example (Kotler 2000). From organisations’ perspective, with the globalisation and technological advances organisations are facing more intense competition from both domestic and foreign competitors.

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In response to the changes, organisations are rethinking their marketing philosophies. There are two outstanding characteristics in today’s marketers’ responses and adjustments: first, customer relationship management; second, every employee is a marketer. To illustrate, “it has long been claimed that it is between five and ten times as expensive to win a new customer than it is to retain an existing one (Rosenberg and Czepiel 1984 in Buttle 1996: 5).” Loyal customers are normally profitable to organisations. In order to retain and satisfy customers, organisations need to not only listen to customers but also respond quickly and constructively to customers. ...

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