Marketing Plan Contents and Presentation

Practical presentation There are many formats for marketings plans and every company does it a little differently, but the outline that follows is a very complete format. Using this format will produce a 30 to 40 page plan. Many companies prefer an abridged format that would yield a 10 to 20 page plan. 1. Title Page 2. Executive Summary 3. Current Situation- Macroenvironment o Economy o Legal o Government o Technology o Ecological o Sociocultural o Supply chain 4. Current Situation- Market Analysis o Market definition o Market size o Market segmentation o Industry structure and strategic groupings o Porter 5 forces analysis o Competition and market share o Competitor`s strengths and weakness o Market trends 5. Current Situation- Consumer Analysis o Nature of the buying decision o Participants o Demographics o Psychographics o Buyer motivation and expectations o Loyalty segments 6. Current Situation- Internal o Company resources  Financial  People  Time  skills o objectives  mission statement and vision statement  corporate objectives  financial objectives  marketing objectives  long term objectives o corporate culture 7. Summary of Situation analysis o External threats o External opportunities o Internal strengths o Internal weakness o Key success factors in the industry o Our sustainable competitive advantage 8. Marketing research o Information requirements o Research methodology o Research results 9. Marketing Strategy- Product o Product mix o product strengths and weakness  perceptual mapping o product life cycle management and new product development o brand name, brand image, and brand equity o the augmented product o product portfolio analysis  B.C.G Analysis  G.E. Multi factoral analysis  Quality Function Deployment 10. Marketing Strategy- Market share objectives o By products, o By customer segments, o By graphical markets 11. Marketing Strategy- Price o Pricing objectives o Pricing method (eg: cost plus, demand based, or competitor indexing) o Pricing strategy (eg: skimming, or penetration) o Discounts and allowances o Price elasticity and customer sensitivity o Price zoning o Break even analysis at various prices 12. Marketing Strategy- promotion o Promotional goals o Promotional mix o Advertising reach, trequency, flights, theme, and media o Sales force requirements, techniques, and management o Sales promotion o Puplicity and public relations o Electronic promotion (eg.: Web, or telephone) 13. Marketing Strategy- Distribution o Geographic coverage o Distributional channels o Physical distribution and logistics o Electronic distribution 14. Implementation o personnel requirements  assign responsibilities  give incentives  training on selling methods o financial requirements o management information systems requirements o month-by-month agenda  PERT or critical path analysis o monitoring results and benchmarks o adjustment mechanism o contingencies (What if`s) 15. financial Summary o assumption o pro-forma monthly income statement o contribution margin analysis o breakeven analysis o Monte Carlo method o ISI: Internet Strategic Intelligence 16. scenarios o Prediction of Future Scenarios o Plan of Action for each Scenarios 17. Appendixes o pictures and specifications of the new product o results from research already completed

Marketing Plan

Meaning and Concept A Marketing Plan is a written document that details the actions necessary to achieve a specified marketing objective(s). It can be for a product or service, a brand, or a product line. It can cover one year (referred to as an annual marketing plan), or cover up to 5 years. A marketing plan may be part of an overall business plan. Solid marketing strategy is the foundation of a well-written marketing plan. While a marketing plan contains a list of actions, a marketing plan without a sound strategic foundation is of little use. Measurement of Progress The final stage of any marketing planning process is to establish targets (or standards) so that progress can be monitored. Accordingly, it is important to put both quantities and timescales into the marketing objectives (for example, to capture 20 per cent by value of the market within two years) and into the corresponding strategies. Changes in the environment mean that the forecasts often have to be changed. Along with these, the related plans may well also need to be changed. Continuous monitoring of performance, against predetermined targets, represents a most important aspect of this. However, perhaps even more important is the enforced discipline of a regular formal review. Again, as with forecasts, in many cases the best (most realistic) planning cycle will revolve around a quarterly review. Best of all, at least in terms of the quantifiable aspects of the plans, if not the wealth of backing detail, is probably a quarterly rolling review - planning one full year ahead each new quarter. Of course, this does absorb more planning resource; but it also ensures that the plans embody the latest information, and - with attention focused on them so regularly - forces both the plans and their implementation to be realistic. Plans only have validity if they are actually used to control the progress of a company: their success lies in their implementation, not in the writing'. The most important elements of marketing performance, which are normally tracked, are: Sales analysis Most organizations track their sales results; or, in non-profit organizations for example, the number of clients. The more sophisticated track them in terms of 'sales variance' - the deviation from the target figures - which allows a more immediate picture of deviations to become evident. `Micro- analysis', which is a nicely pseudo-scientific term for the normal management process of investigating detailed problems, then investigates the individual elements (individual products, sales territories, customers and so on) which are failing to meet targets. Market share analysis Relatively few organizations, however, track market share. In some circumstances this may well be a much more important measure. Sales may still be increasing, in an expanding market, while share is actually decreasing - boding ill for future sales when the market eventually starts to drop. Where such market share is tracked, there may be a number of aspects which will be followed: • overall market share • segment share - that in the specific, targeted segment • relative share -in relation to the market leader Expense analysis The key ratio to watch in this area is usually the `marketing expense to sales ratio'; although this may be broken down into other elements (advertising to sales, sales administration to sales, and so on). Financial Analysis The `bottom line' of marketing activities should at least in theory, be the net profit (for all except non-profit organizations, where the comparable emphasis may be on remaining within budgeted costs). There are a number of separate performance figures and key ratios which need to be tracked: • gross contribution<>net profit • gross profit<>return on investment • net contribution<>profit on sales There can be considerable benefit in comparing these figures with those achieved by other organizations (especially those in the same industry); using, for instance, the figures which can be obtained (in the UK) from `The Centre for Interfirm Comparison'. The most sophisticated use of this approach, however, is typically by those making use of PIMS (Profit Impact of Management Strategies), initiated by the General Electric Company and then developed by Harvard Business School, but now run by the Strategic Planning Institute. The above performance analyses concentrate on the quantitative measures which are directly related to short-term performance. But there are a number of indirect measures, essentially tracking customer attitudes, which can also indicate the organization's performance in terms of its longer-term marketing strengths and may accordingly be even more important indicators. Some useful measures are: • market research - including customer panels (which are used to track changes over time) • lost business - the orders which were lost because, for example, the stock was not available or the product did not meet the customer's exact requirements • customer complaints - how many customers complain about the products or services, or the organization itself, and about what.

Marketing paradigms

Meaning and Concept A marketing paradigm is a set of procedures and attitudes that, taken together, define how marketing is done. The traditional marketing pradigm Marketing is at least as old as civilization, but modern marketing as an applied art and science began in the 1960s and 70s. It originated in consumer markets where relatively low-valued products were sold to mass markets using mass media. Marketing theory held that the first step was to determine customer needs, then next, produce a product or service that will satisfy these needs. The underlying philosophy was that all the firm's strategic decisions were driven by customer expectations. This core idea has gone though many incarnations in the intervening decades, and gone under various names including: marketing orientation, customer driven, the marketing philosophy, customer intimacy, customer focus, and market driven as a discipline has seen a gradual evolution, refining its key concepts, adding many new concepts, and broadening its scope. For example, there has been a gradual shift from mass marketing to segmented marketing to mass customization. Marketing has also broadened its scope to include industrial markets (introducing the concepts of long-term marketing relationships, microsegmentation, and buying centers) and to include electronic markets (introducing the concept of personalized marketing) and to include channel management (introducing the concepts of supply chain marketing programs and distributor marketing programs). New marketing paradigm Starting in the 1980s, there was a group of theorists that felt this gradual evolution was unsatisfactory. They saw marketing, not as a continuously evolving discipline, but as an established discipline ripe for a paradigm shift. They felt that a radical new perspective was required. These theorists are typically associated with either relationship marketing, customer experience management, or network marketing. Relationship marketers, for example, feel that the shift from single transaction marketing to long-term relationship marketing will require a complete revamping of the discipline. Customer experience marketers feel that the relationship marketers started in the right direction but were derailed by their dependence on customer relationship management software, which caused them to lose focus of the individual customer's experience of the service encounter. Network marketers stress the interconnectedness of market actors and transactions and can be seen as the application of systems thinking to marketing. Whether we envision a gradual history of evolution, or a radical paradigm shift probably has more to do with factors associated with the individual's psyche than with any objective or empirical system of change categorization. One thing is certain however, marketing is being greatly enriched by these contributions.

Marketing mix

Meaning and Concept The marketing mix approach to marketing is a model of crafting and implementing marketing strategies. It stresses the "mixing" or blending of various factors in such a way that both organizational and consumer (target markets) objectives are attained. The model was developed by Neil Borden (Borden, N. 1964) who first started using the phrase in 1949. Borden claims the phrase came to him while reading James Culliton's description of the activities of a business executive: (An executive is) "a mixer of ingredients, who sometimes follows a recipe as he goes along, sometimes adapts a recipe to the ingredients immediately available, and sometimes experiments with or invents ingredients no one else has tried." (Culliton, J. 1948) When blending the mix elements, marketer(s) must consider their target market. They must understand the wants and needs (see Maslow) of the market (customer) then use these mix elements in constructing (formulating) appropriate marketing strategies and plans that will satisfy these wants. The mix must also meet or exceed the objectives of the organization. As Borden put it,"When building a marketing program to fit the needs of his firm, the marketing manager has to weigh the behavioral forces and then juggle marketing elements in his mix with a keen eye on the resources with which he has to work." (Borden, N. 1964 pg 365). The most common variables used in constructing a marketing mix are price, promotion, product and place (also called distribution). First suggested by Jerome McCarthy (McCarthy, J. 1960), they are sometimes referred to as the four P's. McCarthy's four P's look at marketing from the perspective of the marketer. It describes what variables marketers have to work with, and hence is sometimes referred to as a marketing management perspective. Another set of marketing mix variables were developed by Albert Frey. He (Frey, A. 1961) classified the marketing variables into two categories: the offering, and process variables. The "offering" consists of the product, service, packaging, brand, and price. The "process" or "method" variables included advertising, promotion, sales promotion, personal selling, publicity, distribution channels, marketing research, strategy formation, and new product development. More recently, Bernard Booms and Mary Bitner built a model consisting of seven P's (Booms, B. and Bitner, M. 1981). In addition to product, price, promotion, and place, they included people, physical evidence, and process. "People" was added, to recognize the importance of the human element in all aspects of marketing. They added "process" to reflect the fact that services, unlike physical products, are experienced as a process at the time that they are purchased. "Physical evidence" or "peripheral clues" reflects the physical surroundings associated with a service encounter or retail location. Other marketing theorists include "partners" as a mix variable because of the growing importance of collaborative channel relationships. One more P, packaging, has been added to this list by some people. The rationale is that it is very important how the product is presented to the customer, and the packaging is often the first contact that a customer has with a product. The marketing mix model is often expanded to include sub-mixes. For example, the promotion variable can be further decomposed into a promotional mix consisting of advertising, sales promotion, personal selling, publicity, direct marketing, undercover marketing, viral marketing, and e-marketing. Within the promotional mix, advertising can be further broken down into an "advertising media mix" that specifies how much emphasis is placed on television ads, radio ads, newspaper ads, internet ads, magazine ads, etc.

Marketing Management Activities and functions

Marketing management therefore encompasses a wide variety of functions and activities, although the marketing department itself may be responsible for only a subset of these. Regardless of the organizational unit of the firm responsible for managing them, marketing management functions and activities include the following: Marketing research and analysis In order to make fact-based decisions regarding marketing strategy and design effective, cost-efficient implementation programs, firms must possess a detailed, objective understanding of their own business and the market in which they operate. In analyzing these issues, the discipline of marketing management often overlaps with the related discipline of strategic planning. Traditionally, marketing analysis was structured into three areas: Customer analysis, Company analysis, and Competitor analysis (so-called "3Cs" analysis). More recently, it has become fashionable in some marketing circles to divide these further into five "Cs": Customer analysis, Company analysis, Collaborator analysis, Competitor analysis, and analysis of the industry Context. The focus of customer analysis is to develop a scheme for market segmentation, breaking down the market into various constituent groups of customers, which are called customer segments or market segments. Marketing managers work to develop detailed profiles of each segment, focusing on any number of variables that may differ among the segments: demographic, psychographic, geographic, behavioral, needs-benefit, and other factors may all be examined. Marketers also attempt to track these segments' perceptions of the various products in the market using tools such as perceptual mapping. In company analysis, marketers focus on understanding the company's cost structure and cost position relative to competitors, as well as working to identify a firm's core competencies and other competitively distinct company resources. Marketing managers may also work with the accounting department to analyze the profits the firm is generating from various product lines and customer accounts. The company may also conduct periodic brand audits to assess the strength of its brands and sources of brand equity. The firm's collaborators may also be profiled, which may include various suppliers, distributors and other channel partners, joint venture partners, and others. An analysis of complementary products may also be performed if such products exist. Marketing management employs various tools from economics and competitive strategy to analyze the industry context in which the firm operates. These include Porter's five forces, analysis of strategic groups of competitors, value chain analysis and others. Depending on the industry, the regulatory context may also be important to examine in detail. In Competitor analysis, marketers build detailed profiles of each competitor in the market, focusing especially on their relative competitive strengths and weaknesses using SWOT analysis. Marketing managers will examine each competitor's cost structure, sources of profits, resources and competencies, competitive positioning and product differentiation, degree of vertical integration, historical responses to industry developments, and other factors. Marketing management often finds it necessary to invest in research to collect the data required to perform accurate marketing analysis. As such, they often conduct market research (alternately marketing research) to obtain this information. Marketers employ a variety of techniques to conduct market research, but some of the more common include: • Qualitative marketing research, such as focus groups • Quantitative marketing research, such as statistical surveys • Experimental techniques such as test markets • Observational techniques such as ethnographic (on-site) observation Marketing managers may also design and oversee various environmental scanning and competitive intelligence processes to help identify trends and inform the company's marketing analysis.

Marketing management

Introduction 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. Definition and scope There is no universally accepted definition of the term. In part, this is due to the fact that the role of a marketing manager can vary significantly based on a business' size, corporate culture, and industry context. For example, in a large consumer products company, the marketing manager may act as the overall general manager of his or her assigned product category or brand with full profit & loss responsibility. In contrast, a small law firm may have no marketing personnel at all, requiring the firm's partners to make marketing management decisions on a largely ad-hoc basis. In the widely used text Marketing Management (2006), Philip Kotler and Kevin Lane Keller define marketing management as "the art and science of choosing target markets and getting, keeping and growing customers through creating, delivering, and communicating superior customer value”. From this perspective, the scope of marketing management is quite broad. The implication of such a definition is that any activity or resource the firm uses to acquire customers and manage the company's relationships with them is within the purview of marketing management. Additionally, the Kotler and Keller definition encompasses both the development of new products and services and their delivery to customers. This view is also consistent with the perspective of management guru Peter Drucker, who wrote: "Because the purpose of business is to create a customer, the business enterprise has two--and only these two--basic functions: marketing and innovation. Marketing and innovation produce results; all the rest are costs. Marketing is the distinguishing, unique function of the business." But because many businesses operate with a much more limited definition of marketing, such statements can appear controversial, or even ludicrous to some business executives. This is especially true in those companies where the marketing department is responsible for little more than developing sales brochures and executing advertising campaigns. The broader, more sophisticated definitions of marketing management from Drucker, Kotler and other scholars are therefore juxtaposed against the narrower operating reality of many businesses. The source of confusion here is often that inside any given firm, the term marketing management may be interpreted to mean whatever the marketing department happens to do, rather than a term that encompasses all marketing activities -- even those marketing activities that are actually performed by other departments, such as the sales, finance, or operations departments. If, for example, the finance department of a given company makes pricing decisions (for deals, proposals, contracts, etc.), that finance department has responsibility for an important component of marketing management -- pricing.

Marketing Basics for the Small Business

The essence of marketing is to understand your customers' needs and develop a plan that surrounds those needs. Let's face it anyone that has a business has a desire to grow their business. You can achieve these purposes in four different ways. They include: • Acquiring more customers • Persuading each customer to buy more products • Persuading each customer to buy more expensive products or up selling each customer • Persuading each customer to buy more profitable products All four of these increase your revenue and profit. Let me encourage you to focus on the first which is to acquire more customers. Why? Because by acquiring more customers you increase your customer base and your revenues then come from a larger base. How can you use marketing to acquire more customers? • Spend time researching and create a strategic marketing plan. • Guide your product development to reach out to customers you aren't currently attracting. • Price your products and services competitively. • Develop your message and materials based on solution marketing. The Importance of a Target Market When it comes to your customers keep in mind the importance of target marketing. The reason this is important is that only a proportion of the population is likely to purchase any products or service. By taking time pitch your sales and marketing efforts to the correct niche market you will be more productive and not waste your efforts or time. It's important to consider your virtual segmentation by selecting particular verticals to present your offerings to. Those verticals will have the particular likelihood of purchasing your products and services. Again, this saves you from wasting valuable time and money. Marketing Differs between Small Businesses and Larger Companies If you are like the majority of small business owners your marketing budget is limited. The most effective way to market a small business is to create a well rounded program that combines sales activities with your marketing tactics. Your sales activities will not only decrease your out-of-pocket marketing expense but it also adds the value of interacting with your prospective customers and clients. This interaction will provide you with research that is priceless. Small businesses typically have a limited marketing budget if any at all. Does that mean you can't run with the big dogs? Absolutely not. It just means you have to think a little more creatively. How about launching your marketing campaign by doing one of the following: • Call your vendors or associates and ask them to participate with you in co-op advertising. • Take some time to send your existing customers' referrals and buying incentives. • Have you thought about introducing yourself to the media? Free publicity has the potential to boost your business. By doing this you position yourself as an expert in your field. • Invite people into your place of business by piggybacking onto an event. Is there a concert coming to town, are you willing to sell those tickets? It could mean free radio publicity. If that is not your cup of tea, how about a walkathon that is taking place in your area, why not be a public outreach and distribute their material? When you do spend money on marketing, do not forget to create a way to track those marketing efforts. You can do this by coding your ads, using multiple toll-free telephone numbers, and asking prospects where they heard about you. This enables you to notice when a marketing tactic stops working. You can then quickly replace it with a better choice or method. Getting Started By being diligent in your marketing and creating an easy strategy such as holding yourself accountable to contact ten customers or potential customers daily five days a week you will see your business grow at an exceptional rate. The great thing is it will not take a large marketing budget to make it happen.

Marketing and Sales

Tips for putting a marketing strategy into place Step 1: Make Time to Plan Step 2: The Benefits Come First Step 3: Build a Framework Step 4: Look for the Gaps: Niche Marketing Step 5: SWOT Analysis Step 6: Goals and Objectives Step 7: The Marketing Mix Step 8: Budget Step 9: Control Introduction Marketing is more than just selling and advertising. It is about finding out who your customers are and how many of them there are, working out how to reach them and let them know about your product or service. This means that marketing covers every aspect of your product or service from inception, design, pricing, distribution, selling and promotion through to after-sales service and customer satisfaction. Getting the right marketing strategy to suit your business and customers is the key to a profitable business. So here are some tips for developing and putting in place a marketing strategy. The first key to marketing is to clearly define what you do. Ask yourself: "who is my company and why am I in business?" Once you understand the answer to this question you are on the way to undertaking the marketing activity. Step 1 - Make Time to Plan It is important to make marketing part of your ongoing business planning. You need to regularly ask yourself who are your competitors, their strengths and weaknesses, who your customers are and what they want and whether there are any gaps in the market (your market niche). So the first step is to make time to plan your marketing strategy. Step 2 - The Benefits Come First Once you have made the time to plan, it is important to define your customers' needs and how this fits with the benefits of your product or service. Marketing is all about needs and benefits. It does not matter what you have to offer - it is what the customer wants that is important. All your marketing should be directed towards answering the customer's question: "What's in it for me?" This means distinguishing between features and benefits. Step 3 - Build a Framework Take the time to sit down and examine what you are about. You need to be aware of your product or service, your potential or existing customers and how you are going to reach them and the competition. Put simply, you will need to know: 1. your product or service - what you can offer; 2. your customers, present or potential; 3. the competition, price levels and performance; 4. distribution; 5. area - geographical. A good question to ask yourself is: "Why should a client/customer come to my business?" If you cannot list the reasons clearly and concisely you can be assured that neither can your potential customers. Step 4 - Look for the Gaps: Niche Marketing Unique products are rare and there is competition everywhere. It is a question of evaluating the strengths and weaknesses of the existing competition and yourself. Where do you fit in the marketplace? What can you offer that is a little bit different? As a small business do not try and take on the whole market and every product. Find a niche and service it well. Matching customer needs with the benefits of your product or service will help you define your market niche. Step 5 - SWOT Analysis Once you have collected all the information sit down and be totally honest with yourself and do a SWOT analysis. SWOT is short for Strengths, Weaknesses, Opportunities and Threats. Doing an analysis of these will help you define areas that you can promote as strengths, areas that need to be worked on and opportunities that may be identified to market new customers or products/services. Under each heading put in point form your honest comments regarding your business and the market in which it will participate. Step 6 - Goals and Objectives Once you have a clear focus on where you are going it is important to establish your marketing objectives for the business. Objectives are, for example: • I will make $1M in turnover during 200x-200x; • I will obtain a market share of Z; • my margins will be X%; • profitability will be Y%; • I will spend 5% of sales on advertising/promotional activities. It is useful to divide objectives into those that are a must and those that are desirable. Where to Now? The establishing of your marketing strategy is based upon what goals and objectives you have for your business. The research and ideas stage is complete, so let's put it into action. Step 7 - The Marketing Mix Once you have a clear picture and focus of your business it is now time to sit with "pen and paper" and write a plan for your marketing activity. The marketing mix is made up of price, promotion, product and place. 1. Price - decide what pricing policy you will have and stick to it. For example, list your price, discount, allowance and credit policies. 2. Promotion - there are many good books on promotion for small business. Ask at your local bookshop or library. Big and expensive promotion is not always the best strategy for a small business. Examples of types of promotion can include selling, public relations, networking, word of mouth and advertising. 3. Product - what product or service are you offering and can you differentiate it by offering additional functions or services? Look at quality, features, benefits, packaging, guarantees, etc. 4. Place - this deals with how you should distribute your product. Consider locations, retailers, inventory, transport and warehousing. This is the start to putting together a marketing strategy. But is the marketing effort complete? No. Now you must do two equally important tasks. Step 8 - Budget Marketing is a cost to the business and must be budgeted for. All small businesses should work with their accountants and develop a cash flow budget. You can also access benchmarking software at your local Business Advisory Service to get an idea of marketing costs in similar business sectors. Step 9 - Controls You must remember that marketing is planning for the future. Regularly monitor the progress of your business to ensure you are on track. Always measure advertising/promotional activities to see which activity gives the greatest growth in sales at an economical cost. Take control on a monthly basis. Do not wait until the end of the quarter to hear from your accountant. Liaise with your accountant, marketing consultant or Business Advisory Service regularly to see how your plans are working. Remember Marketing is a continuous evolving activity and requires constant research, monitoring and control of the strategy to ensure long-term success.

Market share

Meaning and Concept Market share, in strategic management and marketing, is the percentage or proportion of the total available market or market segment that is being serviced by a company. It can be expressed as a company's sales revenue (from that market) divided by the total sales revenue available in that market. It can also be expressed as a company's unit sales volume (in a market) divided by the total volume of units sold in that market. Objectives of Market share Increasing market share is one of the most common objectives used in business. The main advantage of using market share is that it abstracts from industry wide macroenvironmental variables such as the state of the economy, or changes in tax policy. Other objectives include return on investment (ROI), return on assets (ROA), and target rate of profit.

Market Segmentation for the Small Business

Meaning and Concept Definition: To divide a market by a strategy directed at gaining a major portion of sales to a subgroup in a category, rather than a more limited share of purchases by all category users. Market segmentation is one of the steps that goes into defining and targeting specific markets. It is the process of dividing a market into a distinct group of buyers that require different products or marketing mixes. A key factor to success in today's market place is finding subtle differences to give a business the marketing edge. Businesses that target specialty markets will promote its products and services more effectively than a business aiming at the "average" customer. Opportunities in marketing increase when segmented groups of clients and customers with varying needs and wants are recognized. Markets can be segmented or targeted using a variety of factor. The bases for segmenting consumer markets include: • Demographical bases (age, family size, life cycle, occupation) • Geographical bases (states, regions, countries) • Behavior bases (product knowledge, usage, attitudes, responses) • Psychographic bases (lifestyle, values, personality) A business must analyze the needs and wants of different market segments before determining their own niche. To be effective in market segmentation keep the following things in mind: • Segments or target markets should be accessible to the business • Each segmented group must be large enough to provide a solid customer base. • Each segmented group requires a separate marketing plan. Large companies segment their markets by conducting extensive market research projects.This research is often too expensive for small businesses to invest in, but there are alternative ways for to a small business to segment their markets. A small business can do the following to gain knowledge and information on how to segment their markets: • Use secondary date resources and qualitative research. You can use the following resources for external secondary data: o Trade and association publications and experts o Basic research publications o External measurement services • Conduct informal factor and cluster analysis by: o Watching key competitors marketing efforts and copying them. o Talking to key trade buyers about new product introductions o Conducting needs analysis from qualitative research with individuals and groups. There are many reasons for dividing a marketing into smaller segments. Any time you suspect there are significant, measurable differences in your market you should consider market segmentation. By doing so you will make marketing easier, discover niche markets, and become more efficient with your marketing resources.

Market segment

Meaning and Concept 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 requirements for successful segmentation are: • homogenity within the segment • heterogenity between segments • segments are measurable and identifiable • segments are accessible and actionable • segment is large enough to be profitable These criteria can be summarized by the word SADAM: • S Substantial: the segment has to be large and profitable enough • A Accessible: it must be possible to reach it efficiently • D Differential: it must respond differently to a different marketing mix • A Actionable: you must have a product for this segment • M Measurable: size and purchasing power can be measured Currently a college student studying the marketing mix is introduced to the Four Ps of the Marketing Mix; Product, Place, Promotion, Price. • Product (service) is whatever it may be that is being sold/marketed. • Price refers to not only the actual price but also price elasticity. • Place has evidently replaced distribution simply by where or what area the marketing campaign is going to cover, as well as what types of distribution channel (retail, wholesale, online, etc) will be used. Today the idea of place is not limited to geographic profiling but also demographics and other categorizing variables. This has only occurred over the last ten years with the expansion of internet use and its ability to target specific types of people and not just people in a geographic area. • Promotion simply refers to what medium will deliver the message and what the overall marketing strategy is offering as a benefit. The variables used for segmentation include: • Geographic variables o region of the world or country, East, West, South, North, Central, coastal, hilly, etc. o country size/country size : Metropolitian Cities, small cities, towns. o Density of Area Urban, Semi-urban, Rural. o Climate Hot, Cold, Humid, Rainy • Demographic variables o Age o Gender Male and Female o Sexual orientation o Family size o family life cycle o Education Primary, High School, Secondary, College, Universities o Income o Occupation o Socioeconomic status o Religion o Nationality/race o Language • Psychographic variables o Personality o Life style o Value o attitude • Behavioural variables o benefit sought o product usage rate o brand loyalty o product end use o readiness-to-buy stage o decision making unit When numerous variables are combined to give an in-depth understanding of a segment, this is referred to as depth segmentation. When enough information is combined to create a clear picture of a typical member of a segment, this is referred to as a buyer profile. When the profile is limited to demographic variables it is called a demographic profile (typically shortened to "a demographic"). A statistical technique commonly used in determining a profile is cluster analysis.

Market failure

Meaning and Concept Market failure is a term used to describe a situation in which markets do not efficiently allocate goods and services. To economists, the term would normally be applied to situations where the inefficiency is particularly dramatic, or when it is suggested that non-market institutions (such as public policing and firefighting) would be more efficient and wealth-producing than their private alternatives. On the other hand, the term "market failure" is also often used to describe situations where market forces do not serve the perceived public interest. In this article, however, the focus is on market failure as defined by mainstream economics. Economists use model-like theorems to explain or understand such cases. The two main reasons that markets fail are: • the inadequate expression of costs or benefits in prices and thus into microeconomic decision-making in markets. • sub-optimal market structures. The existence of a market failure in a certain economic activity is often used as an argument that the activity in question should not be directed by market forces. This generally leads to a debate on the question of what - if anything - should be used to replace markets. The most common response to a market failure in the present day is to use the government to produce certain goods and services. However, government intervention may cause nonmarket failure by the intevention itself causing externalitites.

Market dominance

Meaning and Concept Market dominance is a measure of the strength of a brand, product, service, or firm, relative to competitive offerings. There is often a geographic element to the competitive landscape. In defining market dominance, you must see to what extent a product, brand, or firm controls a product category in a given geographic area. Calculating Market Dominance There are several ways of calculating market dominance. The most direct is market share. This is the percentage of the total market serviced by a firm or brand. A declining scale of market shares is common in most industries: that is, if the industry leader has say 50% share, the next largest might have 25% share, the next 12% share, the next 6% share, and all remaining firms combined might have 6% share. Market share is not a perfect proxy of market dominance. The influences of customers, suppliers, competitors in related industries, and government regulations must be taken into account. Although there are no hard and fast rules governing the relationship between market share and market dominance, the following are general criteria: • A company, brand, product, or service that has a combined market share exceeding 60% most probably has market power and market dominance. • A market share of over 35% but less than 60%, held by one brand, product or service, is an indicator of market strength but not necessarily dominance. • A market share of less than 35%, held by one brand, product or service, is not an indicator of strength or dominance and will not raise anti-combines concerns of government regulators. Market shares within an industry might not exhibit a declining scale. There could be only two firms in a duopolistic market, each with 50% share; or there could be three firms in the industry each with 33% share; or 100 firms each with 1% share. The concentration ratio of an industry is used as an indicator of the relative size of leading firms in relation to the industry as a whole. One commonly used concentration ratio is the four-firm concentration ratio, which consists of the combined market share of the four largest firms, as a percentage, in the total industry. The higher the concentration ratio, the greater the market power of the leading firms. Alternatively, there is the Herfindahl index. It is a measure of the size of firms in relation to the industry and an indicator of the amount of competition among them. It is defined as the sum of the squares of the market shares of each individual firm. As such, it can range from 0 to 10,000, moving from a very large amount of very small firms to a single monopolistic producer. Decreases in the Herfindahl index generally indicate a loss of pricing power and an increase in competition, whereas increases imply the opposite. Market dominance strategies Market dominance strategies are marketing strategies which classify businesses by reference to their market share or dominance of an industry.

Is there any critique for Profit impact of marketing strategy?

Clearly, it could be argued that a database operating on information gathered in the period 1970 - 1983 is outdated. However data continues to be collected from participating companies and PIMS argues that it provides a unique source of time-series data, the conclusions from which have proven to be very stable over time. It has also been suggested that PIMS is too heavily biased towards traditional, metal-bashing industries, such as car manufacturing; perhaps not surprising, considering the era in which the majority of the surveys were carried out. In reality, as of 2006, the 3,800+ businesses contained within the database includes data from the consumer, industrial and service sectors. It is also heavily weighted towards large companies, at the expense of small entrepreneurial firms. This resulted from the data collection method used. Generally only larger firms are prepared to pay the consulting fee, provide the survey data, and in return have access to the database in which they can compare their business with other large businesses or SBUs. Mintzberg (1998) claims that because the database is dominated by large established firms, it is more suitable as a technique for assessing the state of "being there rather than getting there". (page 99). A serious theoretical criticism has also been mentioned. An empirical correlation does not necessarily imply causation. There is no way of knowing whether high market share caused the high profitability, or whether high profitability caused the high market share. Or even more likely, a spurious factor such as product quality could have caused both high profitability and high market share. Tellis and Golder (1996) claim that PIMS defines markets too narrowly. Respondents described their market very narrowly to give the appearance of high market share. They believe that his self reporting bias makes the conclusions suspect. They are also concerned that no defunct companies were included, leading to "survivor bias”.

Importance (Uses) of Marketing Plans

A formal, written marketing plan is essential; in that it provides an unambiguous reference point for activities throughout the planning period. However, perhaps the most important benefit of these plans is the planning process itself. This typically offers a unique opportunity, a forum, for `information-rich' and productively focused discussions between the various managers involved. The plan, together with the associated discussions, then provides an agreed context for their subsequent management activities, even for those not described in the plan itself.

Implementation planning of Marketing Strategies

After the firm's strategic objectives have been identified, the target market selected, and the desired positioning for the company, product or brand has been determined, marketing managers focus on how to best implement the chosen strategy. Traditionally, this has involved implementation planning across the "4Ps" of marketing: Product management, Pricing, Place (i.e. sales and distribution channels), and Promotion. Taken together, the company's implementation choices across the 4Ps are often described as the marketing mix, meaning the mix of elements the business will employ to "go to market" and execute the marketing strategy. The overall goal for the marketing mix is to consistently deliver a compelling value proposition that reinforces the firm's chosen positioning, builds customer loyalty and brand equity among target customers, and achieves the firm's marketing and financial objectives. In many cases, marketing management will develop a marketing plan to specify how the company will execute the chosen strategy and achieve the business' objectives. The content of marketing plans varies from firm to firm, but commonly includes: • An executive summary • Situation analysis to summarize facts and insights gained from market research and marketing analysis • The company's mission statement or long-term strategic vision • A statement of the company's key objectives, often subdivided into marketing objectives and financial objectives • The marketing strategy the business has chosen, specifying the target segments to be pursued and the competitive positioning to be achieved • Implementation choices for each element of the marketing mix (the 4Ps) • A summary of required investments (in people, programs, IT systems, etc.) • Financial analysis, projections and forecasted results • A timeline or high-level project plan • Metrics, measurements and control processes • A list of key risks and strategies for managing these risks

Impact of Advertising

Advertising has an important effect on a country’s economy, society, culture, and political system. This is especially true in the United States where the advertising industry plays such a prominent role. Economic Impact Most economists believe that advertising has a positive impact on the economy because it stimulates demand for products and services, strengthening the economy by promoting the sale of goods and services. Manufacturers know that advertising can help sell a new product quickly, enabling them to recoup the costs of developing new products. By stimulating the development of new products, advertising helps increase competition. Many economists believe that increased competition leads to lower prices, thereby benefiting consumers and the economy as a whole. These economists also argue that by interesting consumers in purchasing goods, advertising enables manufacturers and others to sell their products in larger quantities. The increased volume of sales enables companies to produce individual units at lower costs and therefore, sell them at a lower price. Advertising thus benefits consumers by helping lower prices. Other economists, however, believe that advertising is wasteful. They argue that the cost of advertising adds to the cost of goods and that most advertising simply encourages consumers to buy one brand rather than another. According to this view, advertising simply moves sales from one company to another, rather than increasing sales overall and thereby benefiting the economy as a whole. Social Impact Advertising can have wide-ranging repercussions on a society. Some critics suggest that advertising promotes a materialistic way of life by leading people to believe that happiness is achieved by purchasing products. They argue that advertising creates a consumer culture in which buying exciting new products becomes the foundation of the society's values, pleasures, and goals. Other critics express concern over the way advertising has affected women and racial minority groups. Ads in the 1950s depicted women primarily as decoration or sex objects. Although millions of women worked outside the home in the 1960s, ads continued to focus on their role as homemakers. Whether owing to the feminist movement or to women's increasing economic power, after the 1960s it became more common to see women depicted in professional roles. However, many ads today still emphasize a woman’s sexuality. The way advertising has depicted racial minorities has also been harmful. Prior to 1960, African Americans were usually shown in a subordinate position. Due to the influence of the civil rights movement, however, advertisers by the 1980s had begun to depict African Americans as students, professionals, or business people. However, many African American organizations and community activists continue to object to the way that alcohol and tobacco companies have seemingly targeted low-income minority communities with a heavy preponderance of outdoor advertising for their products. As ads have begun to more fully reflect the lives of women and African Americans in the United States, increasing attention has been paid to the way in which advertising shows other ethnic groups, including Hispanics, Asians, Native Americans, and Eastern Europeans. There is still considerable debate over how advertising influences public perception of gender and of particular ethnic groups. Advertising has a major social impact by helping sustain mass communications media and making them relatively inexpensive, if not free, to the public. Newspapers, magazines, radio, and broadcast television all receive their primary income from advertising. Without advertising, many of these forms of mass communication might not exist to the extent that they do today, or they might be considerably more expensive, offer less variety, or even be subject to government control through subsidies. In-depth news programs, a diversity of magazines, and free entertainment might no longer be widely available. At the same time, however, some critics warn that because advertising plays such a major economic role, it may exercise undue influence on the news media and thereby curtail the free flow of information in a free society. Reporters and editors, for example, may be hesitant to develop a news story that criticizes a major advertiser. As a result, society might not be alerted to harmful or potentially harmful conduct by the advertiser. Most members of the news media deny that pressure from an advertiser prevents them from pursuing news stories involving that advertiser, but some members of the media acknowledge that they might not be inclined to investigate an issue aggressively if it threatened to offend a major advertiser. Advertisers may affect media programming in other ways, too, critics charge. For example, companies that sponsor TV programs prefer relatively wholesome, noncontroversial programming to avoid offending a mass audience. This preference causes TV networks to emphasize this type of programming. The result is that society may be denied the benefits of being able to view challenging or highly original entertainment programs or news programs on controversial issues. Because advertisers are especially interested in attracting the 18 to 34 year olds who account for most consumer spending, television shows are often developed with this audience in mind. If the ratings show that a program is not attracting large audiences, particularly among 18 to 34 year olds, advertisers often withdraw support, which causes a program to be canceled. As a result, shows that are more likely to interest and to be of value to older audiences are not produced. The impact of television on young children has received much attention. Research suggests that children see television advertising as just another form of programming and react uncritically to its messages, which makes them especially vulnerable to advertising. There is also concern about the way in which adolescent girls respond to advertising that features beautiful, thin models. Research indicates that many adolescent girls are unduly influenced by this standard of beauty, become dissatisfied with their own bodies, and may develop eating disorders in pursuit of a thin figure. New research suggests that adolescent boys are also being influenced by advertising images of bulked-up, buffed bodies. As a result, many become dissatisfied with their own body image, devote large amounts of time to weightlifting, and may even take drugs that have harmful side effects in order to develop more muscle. Those over the age of 60 are thought to be less influenced by advertising, but some elderly people no longer process messages as easily as younger people, making them more susceptible to questionable advertising claims. Political Impact Advertising is now a major component of political campaigns and therefore has a big influence on the democratic process itself. In 1998 more than $467 million was spent on election campaigns in the United States. That amount of spending placed political advertising in the ranks of the country’s 30 leading advertisers that year. Political advertising is a relatively new development in U.S. history. Advertising professionals did not become involved in electoral campaigns until the 1950s. But since then, political advertising has grown in sophistication and complexity. Political advertising enables candidates to convey their positions on important issues and to acquaint voters with their accomplishments and personalities. Television advertising is especially effective for candidates running for national or statewide office because it can reach so many people at once. Candidates can also use advertising to respond effectively to the charges of their opponents. Various campaign finance reform proposals, however, have tried to address the impact of television advertising on political campaigning. Because of the high cost of television ads, the costs of political campaigns have skyrocketed, making it necessary for candidates to raise money continually, even after they have been elected to office. Critics say this factor jeopardizes the democratic process by making elected officials beholden to wealthy contributors and by making it more likely that only the wealthy will run for office. Some reform proposals have called for free airtime, but television and radio networks have resisted this idea. Critics of political advertising also charge that the 30-second television spot has become more important to a political campaign than a thorough discussion of the issues. As a result, voters are bombarded with image advertising rather than being acquainted with the candidate’s positions. They contend that this practice is harmful to good government. Issues are simplified, and candidates are “packaged and sold” much like a consumer product, thereby distorting the political process. Cultural Impact Advertising can affect cultural values. Some advertising messages, for example, encourage aggressive individualism, which may clash with the traditional cultural values of a country where the collective or group is emphasized over the individual or humility or modesty is preferred to aggressiveness. With the globalization of the world economy, multinational corporations often use the same advertising to sell to consumers around the world. Some critics argue that advertising messages are thus helping to break down distinct cultural differences and traditional values, causing the world to become increasingly homogeneous. Many advertising campaigns, however, have universal appeal, overriding cultural differences, or they contribute to culture in a positive way. Humor in advertising has made many ad campaigns widely popular, in some cases achieving the status of folklore or taking on new life in another arena. For example, a popular ad campaign for a fast-food chain with the slogan “Where’s the beef?” became part of the 1980 Democratic presidential primary campaign between Gary Hart and Walter Mondale. The ad ridiculed a competitor by depicting a small hamburger patty dwarfed by a huge bun. During a primary debate one of the candidates used the ad slogan to suggest that his opponent’s campaign lacked substance.

How to Define Your Brand

Introduction This is the first step in the process of developing your brand strategy. By defining who your brand is you create the foundation for all other components to build on. Your brand definition will serve as your measuring stick in evaluating any and all marketing materials and strategies. You will begin this process by answering the questions below. Here's How: 1. What products and/or services do you offer? Define the qualities of these services and/or products. 2. What are the core values of your products and services? What are the core values of your company? 3. What is the mission of your company? 4. What does your company specializes in? 5. Who is your target market? Who do your products and services attract? 6. What is the tagline of your company? What message does your tagline send to your prospects? 7. Using the information from the previous steps create a personality or character for your company that represents your products or services. What is the character like? What qualities stand out? Is the personality of your company innovative, creative, energectic, or sophisticated? 8. Use the personality that you created in the previous step and build a relationship with your target market that you defined in Step 5. How does that personality react to target audience? What characteristics stand out? Which characteristics and qualities get the attention of your prospects. 9. Review the answers to the questions above and create a profile of your brand. Describe the personality or character with words just as if you were writing a biography or personal ad. Be creative. Tips: 1. Be honest with your answers, answer each question thoroughly. 2. Focus on your target audience when answering each question. 3. Compile each answer in a journal or notebook specifically designated to the Brand Development of your company. 4. This is Lesson 1 in the Developing Your Brand Strategy 7-week course offered right here at About. Use it in conjunction with the other lessons to get optimum results and benefits. What You Need: • Brand Journal or Notebook • Pen or Pencil • Uninterrupted Time

Green marketing

Meaning and Concept According to the American Marketing Association, green marketing is the marketing of products that are presumed to be environmentally safe. Thus green marketing incorporates a broad range of activities, including product modification, changes to the production process, packaging changes, as well as modifying advertising. Yet defining green marketing is not a simple task. Other similar terms used are Environmental Marketing and Ecological Marketing. History The term green marketing came into prominence in the late 1980s and early 1990s. The American Marketing Association (AMA) held the first workshop on "Ecological Marketing" in 1975. The proceedings of this workshop resulted in one of the first books on green marketing entitled "Ecological Marketing" [Henion and Kinnear 1976a]. A recent survey discovered that 94 percent of all consumers prefer to do business with companies that demonstrate that they care about the environment. Almost 80 percent said they would pay more for environmentally friendly products. According to Jacquelyn A. Ottman ,( author of Green Marketing: Opportunity for Innovation) from an organizational standpoint, environmental considerations should be integrated into all aspects of marketing — new product development and communications and all points in between. The holistic nature of green also suggests that besides suppliers and retailers new stakeholders be enlisted, including educators, members of the community, regulators, and NGOs. Environmental issues should be balanced with primary customer needs. Green Marketing cases According to Jacquelyn A. Ottman ,( author of Green Marketing: Opportunity for Innovation) from an organizational standpoint, environmental considerations should be integrated into all aspects of marketing — new product development and communications and all points in between. The holistic nature of green also suggests that besides suppliers and retailers new stakeholders be enlisted, including educators, members of the community, regulators, and NGOs. Environmental issues should be balanced with primary customer needs. 2.Car sharing services Car-sharing services addresses the longer-term solutions to consumer needs for better fuel savings and fewer traffic tie-ups and parking nightmares (not to mention more open space and reduction of greenhouse gases) .They may be thought of as a "time-sharing" system for cars. Consumers who drive less than 7,500 miles a year and don't need a car for work can save thousands of dollars annually by joining one of the many services springing up , including ZipCar (East Coast), Flex Car (Washington State), and Hour Car (Twin Cities). 3.Introduction of CNG in Delhi New Delhi,the India`s capital was getting polluted gradually at a very fast pace till Supreme Court of India forced a change of fuel on it. In 2002 , a directive was issued to completely adopt CNG in all public transport systems to curb pollution.

Development of relationship marketing

The origins of relationship marketing observes: "What is surprising is that researchers and businessmen have concentrated far more on how to attract customers to products and services than on how to retain customers". The initial research was done by Leonard Berry at Texas A&M (Berry, L. 1982) and Jag Sheth at Emory, both of whom were early users of the term "Relationship Marketing", and by marketing theorist Theodore Levitte at Harvard (Levitt, T. 1983) who broadened the scope of marketing beyond individual transactions. In practice, relationship marketing originated in industrial and B2B markets where long-term contracts have been quite common for many years. According to Leonard Berry, relationship marketing can be applied: when there are alternatives to choose from; when the customer makes the selection decision; and when there is an ongoing and periodic desire for the product or service. Fornell and Wernerfet used the term "defensive marketing" to describe attempts to reduce customer turnover and increase customer loyalty. This customer-retention approach was contrasted with "offensive marketing" which involved obtaining new customers and increasing customers' purchase frequency. Defensive marketing focused on reducing or managing the dissatisfaction of your customers, while offensive marketing focused on "liberating" dissatisfied customers from your competition and generating new customers. There are two components to defensive marketing: increasing customer satisfaction and increasing switching barriers. Traditional marketing originated in the 1960s and 1970s as companies found it more difficult to sell consumer products. Its consumer market origins molded traditional marketing into a system suitable for selling relatively low-value products to masses of customers. Over the decades, attempts have been made to broaden the scope of marketing, relationship marketing being one of these attempts. Marketing has been greatly enriched by these contributions. The practice of relationship marketing has been greatly facilitated by several generations of customer relationship management software that allow tracking and analysing of each customer's preferences, activities, tastes, likes, dislikes, and complaints. This is a powerful tool in any company's marketing strategy. For example, an automobile manufacturer maintaining a database of when and how repeat customers buy their products, the options they choose, the way they finance the purchase etc., is in a powerful position to custom target sales material. In return, the customer benefits from the company tracking service schedules and communicating directly on issues like product recalls.

Customer relationship management

Meaning and Concept Customer relationship management (CRM) covers methods and technologies used by companies to manage their relationships with clients. Information stored on existing customers (and potential customers) is analyzed and used to this end. Automated CRM processes are often used to generate automatic personalized marketing based on the customer information stored in the system. Implementing Customer relationship management Customer relationship management is a corporate level strategy, focusing on creating and maintaining relationships with customers. Several commercial CRM software packages are available which vary in their approach to CRM. However, CRM is not a technology itself, but rather a holistic approach to an organisation's philosophy, placing the emphasis firmly on the customer. CRM governs an organization's philosophy at all levels, including policies and processes, front-of-house customer service, employee training, marketing, systems and information management. CRM systems are integrated end-to-end across marketing, sales, and customer service. A CRM system should: • Identify factors important to clients. • Promote a customer-oriented philosophy • Adopt customer-based measures • Develop end-to-end processes to serve customers • Provide successful customer support • Handle customer complaints • Track all aspects of sales • Create a holistic view of customers' sales & services information CRM Architecture There are three fundamental components in CRM: • Operational - automation of basic business processes (marketing, sales, service). • Analytical - analysis of customer data and behavior using business intelligence • Collaborative - communicating with clients Operational CRM Operational CRM provides automated support to "front office" business processes (sales, marketing and service). Each interaction with a customer is generally added to a customer's history, and staff can retrieve information on customers from the database as necessary Voicenotes can be used for a sales person to provide more details on their clients after meeting with them for the first time (and therefore may turn into a customer in the future), or to provide a quick debrief after a meeting so not to forget what was said. A voicenote can be left via a mobile and is converted to text whereby the user can add this to the profile of the client to add richness to the information about said client. Especially useful in financial services industries and institutional sales. Sales force automation (SFA) or Sales force management systems. These automate some of a company's critical sales and sales force management tasks, such as forecasting, sales administration, tracking customer preferences and demographics, performance management, lead management, account management, contact management and quote management. Customer service and support (CSS) CSS automates certain service requests, complaints, product returns and enquiries. Enterprise marketing automation (EMA) EMA provides information about the business environment, including information on competitors, industry trends, and macroenvironmental variables. EMA applications are used to improve marketing efficiency. Integrated CRM software is often known as a "front office solution", as it deals directly with customers. Many call centers use CRM software to store customer information. When a call is received, the system displays the associated customer information (determined from the number of the caller). During and following the call, the call center agent dealing with the customer can add further information. Some customer services can be fully automated, such as allowing customers to access their bank account details online or via a WAP phone. Analytical CRM Analytical CRM analyses data (gathered as part of operational CRM, or from other sources) in an attempt to identify means to enhance a company's relationship with its clients. The results of an analysis can be used to design targeted marketing campaigns, for example: • Acquisition: Cross-selling, Up-selling • Retention: Retaining existing customers (antonym: customer attrition) • Information: Providing timely and regular information to customers Other examples of the applications of analyses include: • Contact optimization • Evaluating and improving customer satisfaction. • Optimizing sales coverage • Fraud detection • Financial forecasts • Price optimization • Product development • Program evaluation • Risk assessment and management • Strategic Marketing • Operational marketing Data collection and analysis is viewed as a continuing and iterative process. Ideally, business decisions are refined over time, based on feedback from earlier analyses and decisions. Most analytical CRM projects use a data warehouse to manage data. Collaborative CRM Collaborative CRM focuses on the interaction with customers (personal interaction, letter, fax, phone, Internet, e-mail etc). Collaborative CRM includes: • Providing efficient communication with customers across a variety of communications channels • Providing online services to reduce customer service costs • Providing access to customer information while interacting with customers Driven by authors from the Harvard Business School (Kracklauer/Mills/Seifert), Collaborative CRM also seems to be the new paradigm to succeed the leading Efficient Consumer Response and Category Management concept in the industry/ trade relationship. Importance ( Uses ) of CRM In its broadest sense, CRM covers all interaction and business with customers. A good CRM program allows a business to acquire customers, provide customer services and retain valued customers. Customer services can be improved by: • Providing online access to product information and technical assistance around the clock. • Identifying what customers value and devising appropriate service strategies for each customer. • Providing mechanisms for managing and scheduling follow-up sales calls. • Tracking all contacts with a customer. • Identifying potential problems before they occur • Providing a user-friendly mechanism for registering customer complaints • Providing a mechanism for correcting service deficiencies • Storing customer interests in order to target customers selectively • Providing mechanisms for managing and scheduling maintenance, repair, and on-going support Technical Consideration The following factors need to be considered: • Scalability: the system should be highly scalable, as the volume of data stored in the system grows over time • Communication channels: CRM can interface with a variety of different channels (phone, WAP, Internet etc.) • Workflow - a company's business processes need to be represented by the system with the ability to track the individual stages and transfer information between steps • Assignment - the ability to assign requests, such as service requests, to a person or group. • Database - the means of storing customer data and histories (in a data warehouse) • Customer privacy considerations, such as data encryption and legislation Improving Customer Relationships CRM applications often track customer interests and requirements, as well as their buying habits. This information can be used to target customers selectively. Furthermore, the products a customer has purchased can be tracked throughout the product's life cycle, allowing customers to receive information concerning a product or to target customers with information on alternative products once a product begins to be phased out. Repeat purchases rely on customer satisfaction, which in turn comes from a deeper understanding of each customer and their individual needs. CRM is an alternative to the "one size fits all" approach. In industrial markets, the technology can be used to coordinate the conflicting and changing purchase criteria of the sector. Privacy and Ethical Concerns The data gathered as part of CRM raises concerns over customer privacy and enables persuasive sales techniques (see persuasion technology). However, CRM does not necessarily involve gathering new data, but also includes making better use of customer information gathered as a result of routine customer interaction. The privacy debate generally focuses on the customer information stored in the centralized database itself, and fears over a company's handling of this information. For example, there is virtually no way a consumer can determine if the company shares private (personally identifiable) data with third parties. Furthermore, companies may not always accurately declare to the consumer the types of information collected by CRM systems and the specific purposes for which the information is used. CRM for Non-profit Organizations CRM is also important to non-profit organizations, which sometimes use the terms "constituent relationship management", "contact relationship management" or "community relationship management" to describe their information systems for managing donors, volunteers and other supporters. salesforce.com, a popular CRM service that is on demand, offers its products for free to nonprofit organizations.

Criticisms of relationship marketing

Internal marketing and the six markets model has been criticized as not really being marketing at all. At the core of marketing is the marketing philosophy of first determining what the market wants, then providing it. It is doubtful that this is what is occurring in influence markets, supplier markets, recruitment markets, or internal markets. What is occurring is closer to public relations, persuasion, and management. It appears to be marketing because it uses some marketing techniques, but it would more accurately be described as salesmanship. Relationship theorists tend to compare themselves to traditional marketing. In doing so they frequently present traditional marketing in an unfavourable light. For example, Adrian Payne (1991) claims that traditional marketing concentrates on product features, has minimal interest in customer service, limited customer contact, and quality is primarily a concern of production. Although there may still be some marketers that think this way, these statements have not reflected marketing best practices for more than three decades.

Consumerism

Meaning and Concept Consumerism is a term used to describe the effects of equating personal happiness with purchasing material possessions and consumption. It is often associated with criticisms of consumption starting with Karl Marx and Thorstein Veblen, but can actually be traced back to the first human civilizations. In economics, consumerism can also refer to economic policies that place an emphasis on consumption, and, in an abstract sense, the belief that the free choice of consumers should dictate the economic structure of a society (cf. Producerism, especially in the British sense of the term). History Although consumerism is commonly associated with capitalism and the Western world, it is multi-cultural and non-geographical, as seen today in Tokyo, Singapore, Hong Kong, Shanghai, Taipei, Tel Aviv and Dubai, for example. Consumerism, as in people purchasing goods or consuming materials in excess of their basic needs, is as old as the first civilizations. Since consumerism began, various individuals and groups have consciously sought an alternative lifestyle through simple living. While consumerism is not a new phenomenon, it has only become widespread over the 20th century and particularly in recent decades, under the influence of neoliberal capitalism and globalization. Usage Popular media used "Consumerist" as a short-form for "Consumer-Activist". Webster`s dictionary added "the promotion of the consumer's interests" alongside "the theory that an increasing consumption of goods is economically desirable" under "Consumerism”. Criticism In many critical contexts, consumerism is used to describe the tendency of people to identify strongly with products or services they consume, especially those with commercial brand names and obvious status-enhancing appeal, e.g. an expensive automobile, rich jewelry. A culture that is permeated by consumerism can be referred to as a consumer culture. Impulse buyers who cannot resist spending money are commonly termed shopaholics. Opponents of consumerism argue that many luxuries and unnecessary consumer products are social signals that allow people to identify like-minded individuals through consumption and display of similar products. Some believe that relationships with a product or brand name are substitutes for the healthy human relationships lacking in dysfunctional modern societies and along with consumerism itself are part of the general process of social control and cultural hegemony in modern society. The older term "conspicuous consumption" spread to describe consumerism in the United States in the 1960s, but was soon linked to larger debates about media theory, culture jamming, and its corollary productivism. The term and concept of "conspicuous consumption" originated at the turn of the 20th century in the writings of economist Thorstein Veblen. The term describes an apparently irrational and confounding form of economic behaviour. Veblen's scathing proposal that this unnecessary consumption is a form of status display is made in darkly humorous observations like the following: Victor Frankl had suggested that in the U.S., the engine behind consumerism is an extension of the "bread-winner" desire, an argument originally made by Veblen in his 1899 book. "Overcoming Consumerism" is a growing philosophy. It is a term that embodies the active resistance to consumerism. It is being used by many universities as a term for course material and as an introduction to the study of marketing from a non-traditional approach. Comedian Bill Hicks and director Pier Paolo Pasolini were notable opponents of consumerism: Another critical term is religion of consumerism, which may imply that consumerism is based on an irrational belief rather than reason, or may have been coined to evoke the religious notion of idolatry and anti-materialism. An important contribution to the critique of consumerism has been made by the French philosopher Bernard Stiegler, but very little of this has been translated into English. Stiegler argues that capitalism today is governed not by production but by consumption, and that the advertising techniques used to create consumer behavior amount to the destruction of psychic and collective individuation. The diversion of libidinal energy toward the consumption of consumer products, he argues, results in an adddictive cycle of consumption, leading to hyperconsumption, the exhaustion of desire, and the reign of symbolic misery. At the same time, however, he does not believe that simply opposing capitalism is a viable strategy. Counter arguments While there is not precisely an intellectual movement to promote consumerism, there has been, in recent years, strong criticism of the anti-consumerist movement. Most of this comes from libertarian thought. For example, Reason magazine, in 1999, attacked the anti-consumerism movement, claiming Marxist academics are repackaging themselves as anti-consumerists. James Twitchell, a professor at the University of Florida and popular writer, referred to anti-consumerism arguments as "Marxism Lite”. The libertarian attack on the anti-consumerist movement is largely based on the perception that it leads to elitism. Namely, libertarians believe that no person has the right to decide for others what goods are "necessary" for living and which aren't, or that luxuries are necessarily wasteful, and thus argue that anti-consumerism is a precursor to central planning or a totalitarian society. Twitchell, in his book Living It Up, sarcastically remarked that the logical outcome of the anti-consumerism movement would be a return to the sumptuary laws that existed in ancient Rome and during the Middle Ages. Conversely, many anti-consumerists believe that a modern consumer society is created through extensive advertising and media influence, rather than arising from people's natural ideas regarding the kinds of things they need. In other words, anti-consumerists tend to believe that consumerism is an artificial creation sustained by artificial social pressures, while libertarians tend to believe that consumerism is natural and the only way to eliminate it is through artificial social pressures.

What is Consumer behaviour?

It is the study of how people buy, what they buy, when they buy and why they buy. It is a subcategory of marketing that blends elements from psychology, sociology, sociopsychology, anthropology and economics. It attempts to understand the buyer decision making process, both individually and in groups. It studies characteristics of individual consumers such as demographics, psychographics, and behavioural variables in an attempt to understand people's wants. It also tries to assess influences on the consumer from groups such as family, friends, reference groups, and society in general.

Channel of Distribution

Meaning and Concept Means used to transfer merchandise from the manufacturer to the end user. An intermediary in the channel is called a middleman. Channels normally range from two-level channels without intermediaries to five-level channels with three intermediaries. For example, a caterer who prepares food and sells it directly to the customer is in a two-level channel. A food manufacturer who sells to a restaurant supplier, who sells to individual restaurants, who then serve the customer, is in a four-level channel. Intermediaries in the channel of distribution are used to facilitate the delivery of the merchandise as well as to transfer title, payments, and information about the merchandise. For example, a manufacturer may rely upon the workforce employed by a distributor to sell the product, make deliveries, and collect payments. The channels used by a marketer are an integral part of the marketing plan and play a role in all strategic marketing decisions. See also channel competition; channel management; distribution. The Greek philosopher Heraclitus wrote, "Nothing endures but change." Marketing channels are enduring but flexible systems. They have been compared to ecological systems. Thinking about distribution channels in this manner points out the unique, ecological-like connections that exist among the participants within any marketing channel. All marketing channels are connected systems of individuals and organizations that are sufficiently agile to adapt to changing marketplaces. This concept of a connected system suggests that channel exchange relationships are developed to build lasting bridges between buyers and sellers. Each party then can create value for itself through the exchange process it shares with its fellow channel member. So, a channel of distribution involves an arrangement of exchange relationships that create value for buyers and sellers through the acquisition (procurement), consumption (usage), or elimination (disposal) of goods and services. Channel of Distribution Means used to transfer merchandise from the manufacturer to the end user. Intermediaries in the channel are called middlemen. Those who actually take title to the merchandise and resell the goods are merchant middlemen. Those who act as Broker but do not take title are agent middlemen. Merchant middlemen include wholesalers and retailers. Agent middlemen include Manufacturer's Representatives, brokers, and sales agents. The word channel might bring to mind a waterway such as the English Channel, where ships move people and cargo. Or it might bring to mind a passageway such as the Channel, the railroad tunnel under the English Channel. Either image implies the presence of paths or tracks through which goods, services, or ideas flow. This imagery offers a good starting point for understanding channels of distribution. The term marketing channel was first used to describe trade channels that connected producers of goods with users of goods. Any movement of products or services requires an exchange. Whenever something tangible (such as a computer) or intangible (such as data) is transferred between individuals or organizations, an exchange has occurred. Therefore, marketing channels make exchanges possible. How do they facilitate exchanges? Perhaps the key part of any distribution channel is the intermediary. Channel intermediaries are individuals or organizations who create value or utility in exchange relationships. Intermediaries generate form, place, time, and/or ownership values between producers and users of goods or services. Marketing channels were traditionally viewed as a bridge between producers and users. However, this traditional view fails to fully explain the intricate network of relationships that underlie marketing flows—the exchanges of goods, services, and information. To illustrate, consider a prescription drug purchase. To get authorization to purchase the drug, one must visit a physician to obtain a prescription. Then, one might acquire the drug from one of several retail sources, including grocery store chains (such as Kroger's), mass discounters (such as Wal-Mart), neighborhood pharmacies, and even virtual pharmacies (such as Drugstore.com). Each of these prescription drug outlets is a marketing channel. Pharmaceutical manufacturers, distributors, and their suppliers are all equally important links in these channels of distribution for pharmaceuticals. Sophisticated computer systems track each pill, capsule, and tablet from its point-of-production at a pharmaceutical manufacturer all the way to its point-of-sale in retail outlets worldwide. To appreciate the complexity of marketing channels, exchange should be recognized as a dynamic process. Exchange relationships themselves continually evolve as new markets and technologies redefine the global marketplace. Consider, for example, that the World Wide Web's arrival created a new distribution channel now accounting for over $1.3 trillion in electronic exchanges. It may come as a surprise that the fastest-growing segment of electronic commerce involves not business-to-consumer, (called B2C in today's Web language) but business-to-business (B2B) channels. Whether these exchange processes occur between manufacturers and their suppliers, retailers and consumers, or in some other buyer-seller relationship, marketing channels offer an important way to build competitive advantages in today's global marketplace. This is so for two major reasons: • Distribution strategy lies at the core of all successful market entry and expansion strategies. The globalization of manufacturing and marketing requires the development of exchange relationships to govern the movement of goods and services. As you sip your preferred coffee blend at your neighborhood Starbucks, consider that consumers in China, Lebanon, and Singapore may be sipping that same blend. Then consider how the finest coffee beans from Costa Rica or Colombia get to thousands of neighborhood coffee shops, airports, and grocery stores around the world. • New technologies are creating real-time (parallel) information exchange and reducing cycle times and inventories. Take as an example Dell Computer, which produces on-command, customized computers to satisfy individual customer preferences. At the same time, Dell is able to align its need for material inputs (such as chips) with customer demand for its computers. Dell uses just-in-time production capabilities. Internet-based organizations now compete vigorously with traditional suppliers, manufacturers, wholesalers, and retailers. Bricks-and-mortars (organizations having a physical location) and clicks-and-mortars (organizations having a virtual presence) are in a virtual face-off. Evolution of Channels Marketing channels always emerge from the demands of a marketplace. However, markets and their needs are always changing. It's true, then, that marketing channels operate in a state of continuous evolution and transformation. Channels of distribution must constantly adapt in response to changes in the global marketplace. Remember: Nothing endures but change. At the beginning of the nineteenth century, most goods were still produced on farms. The point-of-production had to be close to the point of-consumption. But soon afterward, the Industrial Revolution prompted a major shift in the American populace from rural communities to emerging cities. These urban centers produced markets that needed larger and more diverse bundles of goods and services. At the same time, burgeoning industrialization required a larger assortment of production resources, ranging from raw materials to machinery parts. The transportation, assembly, and reshipment of these goods emerged as a critical part of production. During the 1940s, the U.S. gross national product (GNP) grew at an extraordinary rate. After World War II ended, inventories of goods began to stockpile as market demand leveled off. The costs of dormant inventories—goods not immediately convertible into cash—rose exponentially. Advancements in production and distribution methods now focused on cost-containment, inventory control and asset management. Marketers soon shifted from a production to a sales orientation. Attitudes like "a good product will sell itself" or "we can sell whatever we make" receded. Marketers confronted the need to expand sales and advertising expenditures to convince individual customers to buy their specific brands. The classic four Ps classification of marketing mix variables—product, price, promotion and place—emerged as a marketing principle. Distribution issues were relegated to the place domain. This new selling orientation inspired the development of new intermediaries as manufacturers sought new ways to expand market coverage to an increasingly mobile population. The selling orientation required that more intimate access be established to a now more diversified marketplace. In response, wholesale and retail intermediaries evolved to reach consumers living in rural areas, newly emerging suburbs and densely populated urban centers. Pioneering retailers such as John Wanamaker in Philadelphia and Marshall Field in Chicago quickly sprouted as goliaths in this brave new retail world. Small retailers came of age, as well, offering specialized operations tailored to meet the needs of a changing marketplace. Retailers and their channels evolved in lockstep with the movements and needs of the consumer marketplace. As always, marketing channels were evolving in response to changing marketplace needs. The impact of two remarkable innovations taken for granted today—the car and the interstate highway system—cannot be ignored. These transforming innovations simultaneously stimulated and satisfied Americans' desire for mobility. Manufacturers suddenly began selling their wares in previously inaccessible locations. Millions of Americans fled from the cities to the suburbs in the 1950s and 1960s. Retailers quickly followed. Yet another channel phenomenon emerged, this one involving groups of stores situated together at one site. The suburban shopping center was born. Its child, the mall, soon followed. In 1951, the earth moved. That was the year marketers first embraced the marketing concept. The marketing concept decrees that customers should be the focal point of all decisions about marketing mix variables. It was accepted that organizations should only make what they could market instead of trying to market whatever they could make. This new perspective had a phenomenal impact on channels of distribution. Suppliers, manufacturers, wholesalers, and retailers were all forced to adopt a business orientation initiated by the needs and expectations of each channel member's customer. The marketing concept quickly reinforced the importance of obtaining and then applying customer information when planning production, distribution, and selling strategies. A sensitivity to customer needs became firmly embedded as a guiding principle by which emerging market requirements would be satisfied. The marketing concept remained the cornerstone of marketing channel strategy for some thirty years. It even engendered the popular 1990s business philosophy known as total quality management. Small wonder, then, that in today's Japan the English word customer has become synonymous with the Japanese phrase honored guest. The customer focus espoused within the marketing concept has a broad, intuitive appeal. Yet the marketing concept implicitly suggests that information should flow unidirectionally from customers to intermediaries, and from intermediaries to manufacturers. This unnecessarily restrictive and reactive approach to satisfying customers' needs has been supplanted by the relationship marketing concept. As modern communication and information management technologies emerged, channel members found they could now establish and maintain interactive dialogues with customers. Ideas and information now were exchanged—bidirectionally—in real time between buyers and sellers. Channel members learned that success comes from anticipating one's customer's needs before they do. The earth had moved, again, as the relationship marketing philosophy was widely adopted. How important is a customer dialogue? Sophisticated database and interactive technologies enable channel members to quickly identify changes in customers' preferences. This, in turn, allows manufacturers to modify product designs nimbly. Relationship marketing allows manufacturers to mass-customize offerings and to reduce fixed costs associated with production and distribution. Retailers and wholesalers make better informed merchandising decisions. This is yet another lesson in the costs of carrying unwanted products. Relationship marketing yields greater customer satisfaction with the products and services they acquire and consume. And why not? The customer's voice was heard when the offering was being produced and distributed. Relationship marketing is driven by two principles having particular relevance to marketing channel strategy: • Long-term, ongoing relationships between channel members are cost-effective. (Attracting new customers costs more than ten times more than retaining existing customers.) • The interactive dialogue between providers and users of goods and services is based on mutual trust. (The absence of trust imperils all relationships. Its presence preserves them.)