Marketing and Stakeholders in the Food Industry - Assignment Example

?Marketing and Stakeholders in the Food Industry Introduction All businesses want to satisfy the demands of the society. Therefore, one can say that marketing is the primary function of all businesses. In the past, businesses gave importance to other functions like production and selling. However, the period from 1990s witnessed a considerable change in the attitude as businesses started giving attention to selling satisfaction along with the products. This work intends to analyse how the concept of marketing is different from other philosophies. In addition, the work finds out the various aspects of the marketing concept and illustrates how the marketing concept can be useful for the growth and development of an organization. Lastly, the work identifies the various stakeholders of McDonalds and suggests effective ways of communication that will satisfy each group. In general terms, the concept of marketing claims that in order to gain organisational goals, it is necessary to understand the needs and wants of the target market and deliver the required level of satisfaction more effectively and efficiently than competitors. Thus one can say that under marketing concept, it is more important to sell satisfaction than to sell product (Jain, 2006-07, pp. 292-293). According to AMA definition, “Marketing” is “the process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods, and services to create exchanges that will satisfy individual and organisational objectives” (Shah & D’Souza, 2009, p. 8). Marketing concept and other business philosophies An analysis of the marketing concept proves that it does not focus on maximising profit through increased sales volume. Instead, it gains profit through increased satisfaction of customers. Thus, in the marketing concept, customer is the central figure around which all marketing activities take place. In essence, it becomes necessary to identify the target customers, develop an understanding with them, understand their demands, and provide services and goods to their satisfaction. One can summarise the components of marketing as satisfaction of customers, integration of various marketing activities, and good sales volume (Moore, et al. 2006, p. 142). This concept of marketing is different from the concepts of production, product, selling and holistic marketing. The selling concept was in vogue before the introduction of the marketing concept that is, during 1950s and 1960s. In this concept, the company mainly aims to sell a product to the maximum and gives little attention to the precise requirements of the customers (Kuratko, 2008, p. 359). In that case, the company continues selling a product adopting various promotion schemes. In other words, the company focuses mainly on selling methods to attain maximum profit (Ibid). Yet another important concept is product concept. It focuses primarily on the quality of the product. In other words, a company gives maximum attention to the quality of its product on the belief that as far as the product is of high quality, consumers will be attracted to the product. Similarly, companies used to adopt the concept of production until 1950s. It claims that when a product or service is in maximum demand in the marketplace, the company should focus on producing that product or service as much as possible. An important part of marketing is marketing research. It becomes necessary for all companies to research their market in order to set their direction initially and to assess their performance thereafter. There are various sources to collect marketing information. Some primary sources are customers, dealers, and salesmen. As customers are the people who use the product, they are the best source of information regarding the quality of the product in terms of price, packaging, availability, design etc. similarly, dealers are capable of offering some useful information regarding the customer response to the products. In addition, they will be able to offer vital information regarding the marketing strategies adopted by the rivals. Thirdly, there are salesmen. They are the people who are in constant touch with customers and are well aware about the demands of various segments of customers. Similarly, companies can also depend on secondary sources such as newspapers and magazines, government publications, international agencies, and research institutions (Michael, 2010, p. 17). Next important component is market segmentation. This is an important aspect because a market consists of various individual customers with various needs and expectations. By dividing these people on the basis of their demands, economic status and preferences, the company will be able to better satisfy its customers. Some useful segmentations adopted by businesses are demographic segmentation, geographic segmentation, behavioural segmentation, and psychological segmentation. Another important aspect of marketing is developing an effective marketing mix. Marketing mix can be defined as the suitable combination of the “Four ps” of marketing. The four ps are product, price, place, and promotion. Out of them, ‘product’ includes features of the product, its design, quality, name, packaging, services, and other components like warranties. The segment “price” includes the actual price of the product, discounts offered, modes of payment and payment period, and credit facilities. The third component “place” includes the areas covered under service, transport, location of sales, delivery of goods and services, availability and so on. Finally, “promotion” means activities for publicity like advertising and personal selling. Evidently, marketing is better than other concepts due to a variety of reasons. Firstly, it enables companies to improve their products and services. Secondly, it is good for the customers because they get better products and services at competitive prices. Thirdly, there is increased employment as companies start using more and more resources to get to customers’ hearts. Benefits of marketing for organisations It is always beneficial for an organisation to be market-oriented. This is so because there are so many competitors in the market today, and all are eagerly looking for ways to attract customers. The first obvious advantage is that marketing helps companies adopt better marketing programs. This is so because a market-oriented company remains well aware about the changing customer preferences and the changing strategies of the opponents.Therefore, based on these changes, the company is able to come out immediately with better strategies to overcome the problems. The second obvious advantage is better client retention. It has become evident from studies that customs remain loyal to the companies and products which are able to offer a fast and effective response to customer needs and demands. The mere fact is that this faster and appropriate response makes customers feel that they are valued and are getting the attention they deserve; and this will ensure that the opponents do not easily lure the customers away (Boone, 2012, p. 18). The third advantage is the possibility of strong and long-lasting strategic relationships. The close interaction and increased reliability can give way to the development of a two-way-dialog platform. At this stage, the company and customer behave like partners who are well aware about the needs of each other. This will help in resolving issues through proper dialogues as there is increased understanding and trust. There are many positive effects of a marketing strategy on the organisation. Firstly, it enables the company to engage in more focused production. As the company knows the needs of the customers, it can modify its products to better satisfy the customers. In addition, when the customers become loyal, companies can rely on them for suggestions regarding upgrades. Secondly, it will help companies develop a concentrated strategy, which will clearly define the role of each employee and department. While marketers totally focus on needs and opportunities, production can fully focus on modifying the products according to the feedback they receive. Thus, this will unite the various departments. Lastly, there is long-term profitability. As customers become loyal, they become less vulnerable to competition and become willing to pay higher prices. Stakeholders of McDonalds Stakeholder can be defined as an individual, a group of people or an organisation with concern in the affairs of an organisation. This is so because they are likely to be affected by the actions taken by the organisation. Some stakeholders of a normal organisation are its directors, employees, shareholders, creditors, suppliers, and customers. (SAGE Brief Guide to Business Ethics, 2011, p. 121). In the case of McDonalds, there are many stakeholders. The first group of stakeholders is employees. They can be considered internal stakeholders because they work in the company and have a role in the way the company runs. One group of stakeholders is customers. As they are not working in the company, they can be called external stakeholders. They are stakeholders because they depend on the company for food. Suppliers are the internal stakeholders because they also play an important role in the success of the company. Quality of supply will have a serious impact on the success of the company (McDonald’s Corporation, 2009, p. 4). Government is another stakeholder as the government has a vital interest in the affairs of the company. This is so because the company can influence the economy with the large number of job opportunities it gives. Secondly, government gets a considerable amount of money in the form of various taxes. In addition, there are external stakeholders like trade unions and communities and internal stakeholders like shareholders and directors. Internal stakeholders are those who are working with or within the organisation and who have an influence on the way the company runs. External stakeholders are those who have a concern about the way the company runs but have no influence on the way it operates. Primary stakeholders are those who get directly influenced by the performance of the company, and the secondary stakeholders are those who are indirectly influenced by the same. List of various stakeholders based on category Internal stakeholders External stakeholders Primary stakeholders Secondary stakeholders Employees Suppliers Employees Trade unions Managers Customers Shareholders Government Directors Trade unions Managers Environmental initiatives Shareholders Communities Suppliers Media Suppliers Environmental initiatives Franchisees Communities Franchisees Media Customers Government Suitable forms of communication for various external stakeholders 1. Customers In the case of customers, oral communication or face to face communication has an important role. The benefit of this method is that it helps to observe the non-verbal content of the communication like body language and facial expression. The benefit is that the communication and feedback are instantaneous. Salespeople are in constant touch with customers, and hence they can use this method effectively (Coombs, et al, 2011, p. 48). Another useful method in the case of customers is emails and text messages. It is possible to collect the details of customers who wish to provide the same when they visit the restaurant. Using this information, it is possible to send them regular emails and text messages regarding new additions and new offers. Moreover, observing the individual purchasing pattern of each customer, this can be used to give special offers. Moreover, it is possible to use webcasts to communicate effectively with a large number of customers around the world. Things like chat facility can be added to this. Yet another useful way is paper-based communication like posters and pamphlets. These can be placed in restaurants and will ensure proper communication with customers. 2. Suppliers Admittedly, a company needs to be in constant and accurate communication with its suppliers. So, in the case of suppliers, it is good to use electronic media efficiently. There can be web-based programmes like webinar which helps to do web conference. Moreover, print communication like annual and monthly reports will be highly useful to keep suppliers up-to-date. Telephone facility also is useful in communicating with suppliers as it is faster reliable. 3. Environmental initiatives In order to keep environmental initiatives pleased, it is wise to send regular reports regarding the company’s performance and environmental protection measures; both in electronic and printed form. In addition, an annual face to face meeting with various environmental groups will be a good idea to improve the image of the company. 4. Media To deal with the media, it is necessary for the company to have a special section in its website. This should contain various reports regarding the performance of the company. In addition, the company can invite media for an annual or half-yearly meeting or whenever the company starts a new initiative. 5. Communities It is highly necessary to create a positive image in the community where the company operates. Hence, it is highly necessary to use all available forms of communication to interact with them. Firstly, advertisements in printed and electronic media should be used to communicate with the local people. In addition, posters and local handouts can be used to make people aware about the company. 6. Trade unions Trade unions are concerned about the welfare of the employees. It is good to have regular face to face meeting with their representatives. In addition, company can send printed and electronic reports to them periodically. 7. Government It is vital for a company to be in the good books of government. So, the company should ensure that its reports to government were readily available and sent in time. It can use both print and electronic communication for the same. Conclusion In total, marketing philosophy is considerably more useful than any other previous concepts like selling, product and production for the longterm success of any organisation. This is so because it meets the needs of the customers in a better way and creates loyal customers in the long term. In order to understand the demands of the customers, companies develop various channels of communication. McDonalds, a company in the food industry, uses various methods of communication for various external stakeholders. The methods range from face to face communication, electronic communication, print communication, and communication through silent images. References Boone, L. E. 2012. Contemporary Marketing, 16th Ed. US: Cengage Learning. Coombs, W. T & Iolladay, S. J. 2011. Managing Corporate Social Responsibility: A Communication Approach. UK: John Wiley & Sons. Jain, T.R et al. 2006-07. Industrial Sociology, Economics & Management. New Delhi: FK Publications. Kuratko, D. F. 2008. Entrepreneurship: Theory, Process, Practice. US: Cengage Learning. Moore, C. W et al. 2006. Small Business Management: An Entrepreneurial Emphasis. US: Cengage Learning. Michael, L. 2010. Marketing: Defined, Explained, Applied. New Delhi: Pearson Education India. Shah, K & D’Souza, A. 2009. Advertising N Promotion. New Delhi: Tata McGraw-Hill Education. SAGE Brief Guide to Business Ethics. 2011. US: SAGE. Unknown. 2009. [e-book] McDonald’s Corporation. pp. 1-80. http://www.mcdonalds.at/presse/maps/McDCSR.pdf [Accessed: 25 Nov 2013]. Read More