Marketing Concept to the 21st Century Business of Virgin Group - Essay Example

?Topic: Explain the relevance of the marketing concept to the 21st century business of your choice? A case of Virgin Group. (1964 words). Criteria The business environment in which organizations operate during the contemporary period is dynamic and it is also characterised by factors such as competition, ever changing needs of customers and technological innovations. Thus, the organization’s success in this competitive and dynamic environment is mainly determined by its ability to develop, implement, monitor and evaluate its business strategy (Roussow, 2003). In as far as marketing concept in business is concerned, it can be seen that the ideal criteria that can be used to select one depends on the goals and objectives to be achieved by the organization. In the case of Virgin Group, it can be observed that the overall goal of the organization is to partner with different business groups in order to create recognised brands. Therefore, the element of mutual relationship among the stakeholders involved is very important since it helps the partners involved to pull their resources towards the same direction. As such, the marketing concept that is suitable for this noble cause is relationship marketing since it is designed to improve the viability of the organization through unifying all the stakeholders involved in a certain business. This marketing concept is effective since it is oriented towards fulfilling the needs and wants of all the stakeholders involved in Virgin Group’s activities. Introduction The success of business in its operations mainly depends on the marketing concept adopted. As such, this paper seeks to evaluate the relevance of relationship marketing (RM) to the operations of Virgin Group which is regarded as the 21st century business. The paper starts by describing above mentioned marketing concept and this is followed by a brief introduction of the chosen organization, Virgin Group. The main body of the paper will focus on explaining the relevance of the marketing concept to the 21st century business under spotlight. The main points discussed in the paper will be summarised in the conclusion. Description of the marketing concept Relationship marketing is described as the process of establishing, maintaining, enhancing and commercialising customer relationships so that the objectives of the parties involved are met Strydom (2004). Relationship marketing is particularly concerned with satisfying the customer needs and wants. During the contemporary period, it can be noted that markets are characterised by stiff competition such that it becomes imperative for the organisations to retain their customers in order for them to operate viably in the future, (Athanasopoulou N.D). This can be achieved through establishing quality relationships around services of the customer, suppliers and other stakeholders as well as their values. These stakeholders in business particularly the customers are the main component in the relationship mix. Concerted efforts ought to be taken in order to satisfy the needs of the customers which can lead to creation of loyalty among them. In case of Virgin Group, this strategy can go a long way in creating competitive advantage for the organization. The concept of relationship marketing often involves high customer involvement and contact whereby mutual understanding can be created among the parties involved. Strydom (2004) posits to the effect that relationship marketing is a continuous process. Essentially, the concept of relationship marketing evolved from transactional marketing in order to serve the interests of the customers profitably. The concept of relationship marketing is also centred on creation of value chain which will help the organization to gain a competitive advantage if its products and services are regarded as more valuable than the ones offered by the other competitors in the same industry (Wang et al, 2004). Positive consumer perceptions about a product play a pivotal role in creating quality relationships with customers and this can be developed through continuous engagement of them in the operations of the organization. The product or service offered plays a big role in appealing to the interests of the customers, hence the reason why it should be unique in order to attract more people. Virtually, a unique product can lead to creation of customer loyalty which in turn leads to the development of quality relationships between the organization and the stakeholders involved. This marketing concept is very important to organisations that are concerned about their success since it helps to forge a strong bond between the organization and the stakeholders involved. This leads to the creation of loyalty among the customers which gives the firm a competitive advantage. Introduction to Virgin Group According to its Official Website (2013), “Virgin is a leading international investment group and one of the world's most recognized and respected brands.” The organization was established in 1970 by Sir Richard Branson, and it has grown to become a force to reckon with in different businesses in sectors that range from mobile telephony, travel, financial services, leisure, music, holidays and health & wellness. The company employs approximately 50 000 people across its companies that operate in 34 countries. In 2011, the group generated around ?13bn ($21bn) in revenue from its operations across a diverse range of companies. Virgin Group also uses the strategy of creating partnerships with other companies and this is very effective in as far as development of skills, knowledge and expertise from a variety of industries to build a competent workforce. Virgin Group invests in different companies to help them improve their operations while it is improving its own image at the same time. For instance, Virgin Group has partnered with reputable companies like Coke and British Airways to make a strong brand name across the globe. The company operates independently through partnership with other companies. This helps it to be in a position to fulfill the needs of different people through offering a variety of desired services to the targeted customers. Relevance of the concept to Virgin Group During the current period, it can be seen that customers have changing personal values and these should be always taken into consideration by the marketers of different goods and services to the consumers in order to create quality relationship with them. For instance, social, emotional as well functional value of the product or service should be taken into account in order to create long term relationships with the stakeholders involved. According to Wang et al (2004), customer value is a strategic weapon for attracting and retaining customers in this modern day customer centred era. The aspect of delivering superior customer value has become topical in as far as building and sustaining competitive advantage through creating quality customer relationship management strategies in their operations. The customer is always regarded as king in every business that is oriented towards generating profits. Quality relationship between the organization and the customer is likely to give it a competitive advantage since it can retain its valuable customers. From this assertion, it can be seen that this marketing concept is relevant to the operations of Virgin Group since it will help it to retain its valuable customers as well as to develop a unique and recognisable brand among different stakeholders. Consumers specifically buy certain products in order for them to derive certain values from using them. There are different values that can be derived from consuming a particular product or service by the consumer and these include the following: “emotional value,” utility derived from the affective states of a product or service; “social value,” social utility derived from the product or service, “functional value” utility derived from the perceived quality and expected performance of products and services and “perceived sacrifice” loss derived from the product or service (Wang et al, 2004). Customers are motivated to purchase different products by virtue of obtaining benefits from using such products. When customers are satisfied by the values they derive from the products and services offered, quality relationship between them and the firm will be created. This concept is relevant to Virgin Group since the viability of the organization strongly hinges on the relationships that exist between the firm and the stakeholders involved in its operations. According to Ferrazzi (2006), the relationship between the organization and the consumers is also determined by the attitude of the targeted audiences by the firm towards its products and services. As noted, the environment in which the organizations operate is dynamic hence the need to establish a long lasting relationship with the customers McCarthy & Perreault (1996, p. 196) define an attitude as “a learned predisposition to behave in a consistently favourable or unfavourable way towards market related objects or situations.” Consumers learn over time certain aspects about a product and they tend to develop either a negative or positive attitude towards the product. It is therefore imperative for the marketers to know the behaviour of the consumers in order to be in a better position to appeal to their interests which can help to forge a strong relationship with them. This is essential for the survival of the organization in the long run since its viability mainly depends with the quality relationship that exists between the firm and the consumers. Apparently, it can be noted that this marketing concept that is oriented towards creating strong relationships between the company and the consumers is relevant to the operations of Virgin Group. Virgin Group ought to know that consumer attitudes are not permanent since they can change at any given moment. Thus, positive customer perceptions about the organization can lead to the creation of quality relationship with the customers by the group. When the customers have negative perceptions about a firm’s products and services, its operations are likely to be negatively impacted. The other important aspect in as far as relationship marketing is concerned is related to product positioning. Basically, product positioning refers to the way the product is defined by consumers with regards to its attributes as well as the place it occupies in consumers’ minds and position in the market in relation to other products offered by the competitors (Kotler, 1998). Loyalty among the customers is likely to be created if the product is correctly positioned and this can also lead to the creation of strong relationships between the customers and the firm. Again, it can be seen that the marketing concept concerned is relevant given that it is geared towards improving the operations of the organization in question in the long run. Building strong relationships with the customers requires organizations to use different strategies. Some of the vehicles for relationship marketing include the following: loyalty schemes, sales promotion as well as networking through the use of social sites like Facebook for example. During the current period, it can be noted that the use of new information and communication technology such as the internet has revolutionised the way businesses are conducted. According to Kotler & Armstrong (2004), online marketing is very effecting in creating strong relationships between the company and the consumers. For instance, specially designed websites can be used since they help to create a two way communication channel. Networking through social media sites like Facebook, YouTube as well as twitter among others can help the organization like Virgin Group to create lasting relationships with the consumers. This concept is relevant to the operations of Virgin Group given that organizations are now operating in the environment that is characterised by digital technology such as the internet. Conclusion Over and above, it can be noted that the concept of relationship marketing is very important in the operations of any organization which operates in a dynamic and competitive environment. Strong relationships between the firm and its consumers are essential since the company will be in a better position to gain a competitive advantage over other players in the same industry. This concept is relevant to the operations of Virgin Group and it can give it a competitive advantage if it is fully implemented. This strategy can also ensure viability of the organization in the long run through creation of loyalty among the customers. References Athanasopoulou P (N.D.) Commentary Relationship quality: a critical literature review and research agenda. University of Peloponnese, Athens, Greece Ferrazzi, K 2006, ‘ Wanted: Intimate Marketing Relationship,’ Brandweek; Oct 9, 2006; 47, 36; Research Library Core pg. 16. Kotler, P & Armstrong G 2004, Principles of Marketing, Pearson Education, Upper Saddle River: NJ. Kotler, P 1998, Marketing Management: Analysis, Planning, Implementation and control. Prentice Hall, New Jersey. Paul G. Patterson (N.D.) Demographic correlates of loyalty in a service Context. School of Marketing, University of New South Wales, Sydney, Australia. McCarthy, JE & Perreault, WD 1996, Basic Marketing: A Global Managerial Approach, 12th Edition, Irwin McGraw-Hill, NY. Rossouw, D 2003, Strategic Management, NAE, CT. Strydom, J 2004, Marketing, 3rd Edition, Juta & Co Ltd: CT. Virgin Group, [Official Website]2013, Viewed 11 July 2013, from: . Wang, Y, Hing, PL, Chi, R and Yang, Y 2004, ‘An integrated framework Managing Service Quality.’ Volume 14 · Number 2/3 169-182 Bibliography Lancaster, G & Reynolds, P 1999, Introduction to Marketing: A step by step Guide to all the tools of Marketing, Kogan Page, London. Smith, P.R. (1999), Great Answers to Tough Marketing Questions, Kogan Page, UK. Read More