Among these five marketing management philosophies, the marketing and societal marketing concept focus more on the customers’ needs and wants contrast to the other three concepts. The marketing and societal marketing concept are favoured by FMCG companies as it help the companies identify their customers’ needs and wants to deliver the satisfactions so that the companies can achieve their marketing objectives more effectively and efficiently than their competitors (Koslowsky, 2001, p.166).
5 Marketing involves planning
Marketing plays an important role in strategic planning. Strategic planning is the hard task of selecting an overall company strategy for long-run survival and growth. A company that fail to plan plan to fail. Strategic planning involves develop a clear company mission, supporting objectives, a sound business portfolio and coordinated functional strategies. It is undertaken at a number of levels depending on the size and structure of the organisation. The top level is corporate strategy. At this level decisions concentrate on the scope of the organisation, the portfolio of business now and for the future and how resources are to be obtained and allocated (Kotler, et al., 2004, p.78).
The starting point of strategic planning is defining the company mission which states the organisation’s purpose (Larson, 1998, p.22). For example, as a fast-moving consumer goods company, Unilever sets its mission that “to add vitality to life and to meet the everyday needs for nutrition, hygiene, and personal care with brands that help people feel good, look good, and get more out of life”(Unilever, 2004). This mission acts as an invisible hand that guides people in Unilever so that they can work independently and collectively toward overall organizational goals (Koslowsky, 2001, p.165).
The company’s mission then needs to be turned into detailed supporting objectives for each level of management, which includes business objectives and marketing objectives. The marketing strategies must be developed to support these marketing objectives (Kotler, et al., 2004, p.88). For instance, in 2000, Unilever established its marketing objectives to create annual savings of $1.5 billion by 2004. This objective leads Unilever spent $5 billion program to shed 25,000 jobs, shut down 100 factories and focus its spending on the top 400 of its 1,600 brands, leaving the rest to fade away or be sold (Cowell, 2000, p.C8).
The next step is designing the business portfolio, which includes analyse the current business portfolio and develop growth strategies for adding new products or businesses to the portfolio (Kotler, et al., 2004, p.89). As many companies operate several businesses, the major activity in strategic planning is the business portfolio analysis. The Boston Consulting Group (BCG) approach is being widely used when analysing current business portfolio. For example, Unilever may analyse that which product line under its global food brands, such as ice cream or frozen food, which is a strategic business unit, is a cash cow or a star. The Ansoff’s product/market expansion grid is a useful device for identifying growth opportunities when developing the growth strategies (Larson, 1998, p. 23).
The final step in strategic planning is to develop detailed marketing and other functional strategies of each business and product unit to support the company-wide plan. This includes the strategies developed in marketing, finance, accounting and others (Kotler, et al., 2004, p.102).
6 Marketing as a set of business activities
Marketing process as a set of business activities includes analysing marketing opportunities, selecting target market, developing the marketing mix and managing the marketing effort. The organisations must start with analysing the marketing environment in searching for opportunities and monitoring threats. The marketing environment consists of all the actors and forces that affect the organisation’s ability to transact effectively with target market (Kotler, et al., 2004, p.164). The organisation’s marketing environment can be divided into the micro-environment and the macro-environment. The micro-environment consists of suppliers, marketing intermediaries, customers, competitors and publics. The macro-environment involves demographic, economic, natural, technological and political environment. These factors and forces affect organisation’s effectiveness and efficiency to achieve its objectives (Denison and McDonald, 1995, p.60). For example, the largest customer market is consumer market. The consumer markets are very susceptible to changes in discretionary spending levels, which may largely influence the sales of the organisations. However, this buying power is influenced by the economics situation of the country. Companies in fast-moving consumer goods industry must consider all of these factors and forces in strategic planning (Koslowsky, 2001, p.168).
The factors and forces have led to the need for more and better information. Organisations establish marketing information systems in order to provide managers with good information to assist their decision-making (Kotler, et al., 2004, p.207). Marketing research is an efficient, cost-effective management tool that gets marketers close to the consumer, customer and public through the relevant, accurate, reliable, valid and current information. The most common researches are measurement of market potential, market share, long-range forecasting (Malhotra, Hall, Shaw and Oppenheim, 2002, p.11).
Marketing research consists of four steps including defining the problem and research objectives, designing the research, implementing the research plan and interpreting and reporting the findings (Kotler, et al., 2004, p.216). The most difficult step in marketing research is claimed to be the first step, defining the problem and research objectives, as the problems may be defined to be too narrow or too broad (Malhotra, 2002, p. 13). Take an example, Unilever conducted a research in food and health area. It focused on four areas which are Cardio-vascular diseases, vitality & performance, food & health in developing countries and weight control. Its budget amounts to € 15 million (Unilever, 2004). In this research Unilever may collect secondary data and primary data by looking up the existing information about the health situation of people or by conduct observational, survey and experimental research.
Markets have to be understood before marketing strategies can be developed. Consumer behaviour is influenced by the buyer’s characteristics and by the buyer’s decision process. Marketers must understand how consumers transform marketing and other inputs into buying responses (Kotler, et al., 2004, p. 272). Consumer buying behaviour is influenced by several factors including psychological factor, such as motivation, perception; personal factors, such as age, gender; culture factors, such as subculture and social class and social factors, such as household types (Clark, 2003, p.199). People purchase goods through a buying decision process, which consists of need recognition, information search, evaluation of alternatives, purchase decision and post-purchase behaviour (Kotler, et al., 2004, p. 266). For instance, the perception of a consumer to a product may influence him or her to buy a Unilever product or a P&G product under the same product category.
The in order to develop more effective products and marketing mixes, marketers adopt target marketing approach, which requires segmenting, targeting and positioning the market. Segmenting the market reveals opportunities to grow sales, by grouping customers based on some common characteristics and their responses to benefits, programmes, and services (Weber, 2004, p.52). Targeting the selected market requires choosing a market-coverage strategy. This strategy can be undifferentiated, differentiated and concentrated marketing. Positioning is the act of designing the company's offering and image to occupy a distinct place in the target market's mind (Kalafatis, Tsogas, and Blankson, 2000, p.416). As a fast-moving consumer goods company, Unilever targets at several different markets, such as one of its product, Slim-Fast, targets at the group of people who are overnourished and have weight problems (Unilever, 2004).
After selecting a target market, marketing managers must develop a systematic plan to sell to these customers and create long-term relationships. The generally accepted means of implementing the marketing concept is the model of the marketing mix. The concept of the 4Ps - product, price, promotion, and place - the Marketing Mix - summarise key decision responsibilities of marketing managers (Goldsmith, 1999, p.178).
The marketing mix proposed that managers had to decide first on the product they hoped to sell to consumers. These decisions involved chiefly the features the product would have, its benefits for consumers, the level of quality offered, quantities, and package forms (Goldsmith, 1999, p.178). For example, Unilever extended its bands by acquiring powerful brands like Ben & Jerry's Homemade and Slim-Fast Foods (Cowell, 2000, p.C8).
Price is a critical element in marketing mix as it is the only element of the mix that produces the revenue, all other elements represent costs. There are internal and external factors influence the pricing decision, such as costs, company’s marketing objectives and competitor’s prices (Kotler, et al., 2004, p. 521). Take an example that Procter & Gamble was cutting prices in Europe after the success of its "everyday low pricing" strategy in its domestic market 1996. It has already reduced the prices of its Fairy brand of washing-up liquid and its Flash brand of laundry detergent. Later on, Unilever reduced the price of its Persil brand of washing-up liquid in the UK to compete with P&G (Cozens, 1999, p.9).
Marketers also have to make decisions on how to deliver the goods to the customer, and this is through the logistics networks. The marketing logistics networks functions include effective and efficient conversion operations, order processing, warehousing, inventory management and transportation (Kotler, et al., 2004, p.564). Unilever NV's home and personal-care division in North America has cut from 100 to 30 the number of carriers it uses to transport production freight, replenish distribution centers, and deliver products to customers. This action was aim to reduce the distribution costs to gain competitive advantages. (Bacheldor, 2003, p.78).
Promotion is a strategy used to encourage purchase of a product or increase the awareness of the company in the public. Fast moving consumer goods industry often use sale promotion as a tool to prompt a immediate sale, whether in-store or through direct channels or by adding urgency to media advertising. It is important to understand the communication process and avoid mislead the consumers. There are a number of integrated marketing communication media, tools and technologies in assisting organisations to communicate with their consumers (Kotler, et al., 2004, p.648). For example, Unilever ICF is undertaking a major in-store promotion as part of a £6.5million push to revitalise its Cornetto ice-cream brand. It includes award consumers who purchase a Cornetto Love Potion receive a game-card on which they have to match love potion symbols. The top prize is one of six holidays in any theme park in the world. This promotion helps increase Cornetto sales and public image a lot among its custmers (Derrick, 2004, p.4).
A brilliant marketing strategy counts for little if the company fails to implement it properly. Implementation is the process to turns all the strategies and plans into actions in order to accomplish marketing objectives. A successful implementation requires all levels of the marketing system work together. However, the implementation may fail due to the isolated planning, lack of financial and marketing integration (Kotler, et al., 2004, p.139). Control consists of measuring and evaluating the results of marketing plans and activities and taking corrective action to make sure objectives are being reached (Kotler, et al., 2004, p.122).
7 Importance of marketing
Marketing is critical in all business sectors, whatever big or small, profit or non-profit, domestic or global. The excellent companies are talking not just about satisfying present customer needs, but about anticipating the customer needs of the future and delivering them today. Marketing provides a guiding philosophy which suggests company strategy should revolve around serving the needs of important consumer groups (Kotler, et al., 2004, p22). Marketing, as a culture in an organisation, increase the employees’ abilities to analyse customer needs and competitive offerings. That is to say, the organisations which adopt marketing concept can use more valid strategy to sustain and exploit a firm’s competitiveness by enhancing marketing opportunities with the development and distribution of new products. Marketing explains the central importance of market values and customer beliefs in providing guidance for organizational development (Romano and Ratnatunga, 1999, p. 18). Additionally, marketing as a strategy to enhance actual and market position of organisations through market segmentation, targeting and marketing positioning. It designs strategies within each individual business units in order to achieve the organizational goals more effectively and efficiently (Kotler, et al., 2004, p104). Finally, marketing, as tactics, help marketing management to utilize the marketing mix in relation to the performance or growth of organisations to achieve its objectives by offering superior goods and services (Romano and Ratnatunga, 1999, p. 18).
However, it is claimed that organisations may increase its costs by devoting a large amount of time and money in conducting marketing research, promotion or new product development, which may not always lead to a satisfied outcomes (Romano and Ratnatunga, 1999, p. 22).
8 The role of marketing
The role of marketing is to help the organisations accomplish its profitability objectives in order to survive in the fierce competition. In fast-moving consumer goods industry, marketers use a set of business activities to gain customer loyalty, build customer relationships. All of these efforts aim to generate profits for the company. The essence of marketing is that it should begin with the 'customer', not the organisation. The marketing concept can be adopted by profit organisation as well as non-profit organisations. The organisational focus, marketing orientation, does not seem sufficient for an increasingly competitive nonprofit sector, characterised by an increase in the demand for the services offered by these types of organisations, a reduction in traditional governmental financial support and an increase in the number of organisations. The reality of this sector requires an integrated management by which the organisation shows a sensible attitude towards not only the beneficiaries, as customers of the nonprofit action, but also towards other groups, such as resource donors, with whom it must establish and maintain valuable and satisfactory relationships. Therefore, it is necessary for non-profit organisations to adopt a marketing orientation centered on the customer (, , and , 2002, p. 58). For example, as hospital costs and room rates increase, many hospital faces under-utilisation. One hospital may adopt the marketing concept to compete with the other hospital. They may use innovative billboards to promote its emergency care service (Kotler, et al., 2004, p.23). Marketing can also be applied in service organisations, such as banks. Marketing management in the banks uses the extended marketing mix, which includes process, people and physical evidence, to assist the organisation to provide better service than its competitors. Therefore, marketing helps both profit making organisation and non-profit organisation in meeting its financial objectives in fierce competition (Koslowsky, 2001, p.168).
9 Conclusion
Marketing, as a process of integrated activities to deliver the satisfactions to the customers based on what they need and want, is adopted by a large number of companies including fast-moving consumer goods companies. The fast-moving consumer goods are the goods that require low involvement in consumer buying behaviour. Marketing allow the company to plan ahead in order to satisfy consumers and generate long-term profit. Marketing as a set of business activities involves planning, implementing, and controlling. Organisations set plans on three levels, which are corporate level, strategic business unit level and functional level. The organisations need to analyse and assess the opportunities and threats to determine how to achieve the objectives and goals more effectively and efficiently. This can be done through analysing the organisation’s macro and micro environment. Marketing research is a useful tool to get better information. By understanding the opportunities and threats, companies can then segment, target and position itself in the target market. Consumer behaviour must be understood before the marketing strategies are developed. Marketing mix includes product, price, place and promotion is the essential part of marketing strategy. Marketers must then carry out the actions based on these strategies. Controlling is necessary for correcting, monitoring the process. Marketing is important in several ways. It provides a philosophy, acts as a culture and designs a strategy for the organisation to achieve its profitability objectives.
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