Social responsibility refers to an organization’s obligation to maximize its positive impact on society, while minimizing its negative impact.
3. A major part of this responsibility is marketing ethics, or the principles and standards that define acceptable conduct in marketing activities.
F. Implementation and Control
1. Marketing implementation, the process of executing the marketing strategy, is the “how” of marketing planning.
2. Adequate control of marketing activities is essential to ensure that the strategy stays on course and focused on achieving its goals and objectives.
3. The implementation phase of marketing strategy calls into play the 5th P of the marketing program: people.
G. Developing and Maintaining Customer Relationships
1. Developing long-term customer relationships requires that markers shift away from transactional marketing and embrace a relationship marketing approach.
2. The goal of transactional marketing is to complete a large number of discrete exchanges with individual customers. In relationship marketing, the goal is to develop and maintain long-term, mutually satisfying arrangements where both buyer and seller focus on the value obtained from the relationship. [Exhibit 1.4]
3. Relationship marketing promotes customer trust and confidence in the marketer, who can then develop a deeper understanding of customers’ needs and wants.
V. Taking on the Challenges of Marketing Strategy
A. Challenges and opportunities in planning and developing marketing strategy include:
1. Change—Customers change, competitors change, and even the marketing organization changes. Strategies that are highly successful today will not work tomorrow.
2. People—Marketing strategy is inherently people-driven. It is about people (inside an organization) trying to find ways to deliver exceptional value by fulfilling the needs and wants of other people (customers, shareholders, business partners, society at large).
a) The people-oriented nature of marketing makes marketing strategy a challenging task.
3. Lack of rules—There are very few rules for how to do marketing in specific situations.
4. Increasing customer expectations and declining satisfaction—American customers have a passion for instant gratification that is not being met. The American Customer Satisfaction Index indicates that customer satisfaction has only recently recovered since 1994. [Exhibit 1.5]
a) Customers have become much less brand loyal than in previous generations.
b) Customers are also quite cynical about business in general and are not that trusting of marketers.
5. Mature markets (commoditization)—Many firms compete in markets where product offerings have become commoditized by a lack of differentiation (for example, airlines, wireless phone service, department stores, laundry supplies, household appliances).
6. Controlling costs—Businesses have been forced to cut expenses by eliminating products, lowering distribution costs, or downsizing in order to remain competitive.
B. Even the most admired marketers in the world occasionally have problems meeting the demands of the strategic planning process and developing the “right” marketing strategy.
Questions for Discussion
1. Increasing customer power is a continuing challenge to marketers in today’s economy. In what ways have you personally experienced this shift in power, either as a customer or as a business person? Is this power shift uniform across industries and markets? How so?
For personal experiences, many students will use the example of buying a car. The unprecedented access to information gives customers a great deal of negotiating power when they enter a dealer’s showroom. From a business perspective, students may argue that customers have power due to the number of supplier options they have today. When a customer can quickly shift his/her business to a competitor, they are in a stronger power position. The power shift is not necessarily uniform across industries. Consumers lack negotiating power in most industries; hence, they exercise their power through their product choices.
3. A major part of this responsibility is marketing ethics, or the principles and standards that define acceptable conduct in marketing activities.
F. Implementation and Control
1. Marketing implementation, the process of executing the marketing strategy, is the “how” of marketing planning.
2. Adequate control of marketing activities is essential to ensure that the strategy stays on course and focused on achieving its goals and objectives.
3. The implementation phase of marketing strategy calls into play the 5th P of the marketing program: people.
G. Developing and Maintaining Customer Relationships
1. Developing long-term customer relationships requires that markers shift away from transactional marketing and embrace a relationship marketing approach.
2. The goal of transactional marketing is to complete a large number of discrete exchanges with individual customers. In relationship marketing, the goal is to develop and maintain long-term, mutually satisfying arrangements where both buyer and seller focus on the value obtained from the relationship. [Exhibit 1.4]
3. Relationship marketing promotes customer trust and confidence in the marketer, who can then develop a deeper understanding of customers’ needs and wants.
V. Taking on the Challenges of Marketing Strategy
A. Challenges and opportunities in planning and developing marketing strategy include:
1. Change—Customers change, competitors change, and even the marketing organization changes. Strategies that are highly successful today will not work tomorrow.
2. People—Marketing strategy is inherently people-driven. It is about people (inside an organization) trying to find ways to deliver exceptional value by fulfilling the needs and wants of other people (customers, shareholders, business partners, society at large).
a) The people-oriented nature of marketing makes marketing strategy a challenging task.
3. Lack of rules—There are very few rules for how to do marketing in specific situations.
4. Increasing customer expectations and declining satisfaction—American customers have a passion for instant gratification that is not being met. The American Customer Satisfaction Index indicates that customer satisfaction has only recently recovered since 1994. [Exhibit 1.5]
a) Customers have become much less brand loyal than in previous generations.
b) Customers are also quite cynical about business in general and are not that trusting of marketers.
5. Mature markets (commoditization)—Many firms compete in markets where product offerings have become commoditized by a lack of differentiation (for example, airlines, wireless phone service, department stores, laundry supplies, household appliances).
6. Controlling costs—Businesses have been forced to cut expenses by eliminating products, lowering distribution costs, or downsizing in order to remain competitive.
B. Even the most admired marketers in the world occasionally have problems meeting the demands of the strategic planning process and developing the “right” marketing strategy.
Questions for Discussion
1. Increasing customer power is a continuing challenge to marketers in today’s economy. In what ways have you personally experienced this shift in power, either as a customer or as a business person? Is this power shift uniform across industries and markets? How so?
For personal experiences, many students will use the example of buying a car. The unprecedented access to information gives customers a great deal of negotiating power when they enter a dealer’s showroom. From a business perspective, students may argue that customers have power due to the number of supplier options they have today. When a customer can quickly shift his/her business to a competitor, they are in a stronger power position. The power shift is not necessarily uniform across industries. Consumers lack negotiating power in most industries; hence, they exercise their power through their product choices.