The Extended Marketing Mix and Different Marketing Segmentations and Contexts - Research Paper Example

 There are no definite definitions of marketing, but all of these definitions give some clear views as to the use of marketing to the customer. We have several definitions and all these suggest customer satisfaction through delivery of products, service, and the manner and method these products and services are being delivered. Definitions may be formal, or not so formal. The Chartered Institute of Marketing (cited in Lancaster and Reynolds, 2005, p. 4) defines marketing as “the management process responsible for identifying, anticipating and satisfying customer requirements profitably.” American marketing guru Philip Kotler defines marketing as “a social and managerial process by which individuals and groups obtain what they need and want through creating and exchanging products and value with others”. (Kotler et. al., 2003, cited in Blythe, 2006, p. 4) Kotler’s definition includes the concept of value which is further defined as “the relationship between what is paid and what is received, and can be increased or reduced by marketing activities”. (Blythe 2006, p. 5) Blythe (2006) criticizes Kotler’s definition in that “it tries to include all human exchange processes, and does not differentiate between the buyer and the seller”, making the definition too broad and one cannot actually determine which is marketing and which is not. Blythe further says that ‘another aspect of the Kotler definition is the use of the terms ‘need’ and ‘want’. To most non-marketers, a need is something which is essential to survival, whereas a want is something which is not more than a passing fancy. The definition is rather inadequate for marketers because there are many products that are essential to many people, but there are products which are not. On the other hand, the American Marketing Association defines marketing as follows: “Marketing is the process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods and services to create exchange and satisfy individual and organizational objectives. (Blythe, 2006, p. 5) B. Identify the main characteristics of a marketing oriented organization and explain if you think Dell exhibit these characteristics. Briefly outline what Dell needs to do to become more marketing oriented. Dell is marketing oriented but up to what extent is it marketing-oriented still in question. What is only certain is that through the years after its founding by Michael Dell, Dell continues to improve and look for customer satisfaction. “For a company to be marketing orientated requires that a number of changes take place in organization, in practices and in attitudes. Furthermore, to become operational and of real value to a company requires that the discipline of marketing contributes what might be termed a technology of marketing. By this we mean that management requires the development of a set of tools (techniques and concepts) in order to implement the marketing concept. This includes application of quantitative and qualitative techniques of marketing, research for analyzing and appraising markets. (Jobber and Lancaster, p. 13) It is logical to conclude that Dell Computer exhibited these practices and attitudes. Dell is the first to introduce the marketing concept of made-to-order PCs and computer set-ups. Mariotti (2002) says that ‘Dell reinvented the supply chain and how computers are built, based on a network of partners surrounding its plants.” Not only does Dell supply made-to-order PCs, it has a wide array of products and services all for the customers’ satisfaction. Dell introduces programs in its website to improve customer service. One is their survey, facilitated by a software known as the webValidatorTM which is a questionnaire about Dell products, what the customer wants, customer feedback, and other questions for improvement. At Dell, you can order online, which is one of the most innovative way of marketing for customers. Delivery of the product is within a day or two. “Selling and sales management are now concerned with the analysis of customers’ needs and wants and, through the company’s total marketing efforts, with the provision of benefits to satisfy these needs an wants.” (Jobber and Lancaster, p. 23) C. Various elements of the marketing concept. An organization must be in tune with customer needs or consumer requirements. It must first ask what the customer needs before making the product. This way, its aim is to satisfy the customers’ needs and wants. Jobber and Lancaster (2003) state: “According to the marketing concept, an organisation should try to provide products that satisfy customer’s needs through a co-ordinated set of activities that also allows the organisation to achieve its goals”. (p. 15) The organization must first find out what will satisfy the customer before making the product. In considering the customers’ needs, the organisation must not only think of the immediate or the short-run, but also the long-term needs. By considering only the short term needs and ignoring the long-term needs of the customers, it will only create future dissatisfaction. D. Identify and assess the benefits and costs of a marketing approach to Dell There are costs that Dell should shoulder and not allow those costs to be added to the product. As we can see, Dell mostly relies on online orders from the customers, dealership and retail stores. Added to this are its multi-media ads. Once, it implements marketing concepts, tools and other technique which are not its traditional ways of selling, products and services, the strategy might soar to cover the costs. It will not be beneficial to the customers and Dell as well if its products will be even more expensive. The implementation of other marketing strategies of Dell must be studied closely and in line with its objectives of customers’ satisfaction. Task 2 – Concepts of segmentation, targeting and positioning A. Macro and micro environmental factors which influence marketing decisions in Dell Some of the macro-environment changes that have to be hurdled by Dell are “tax changes, new laws, trade barriers, demographic change and government policy changes” (Oxford University Press, 2007). With the onset of the global financial crisis, there will surely be government policy changes Dell has to encounter. Dell must be able to adjust this with an effective strategy so as not to affect its products, the costs of PC making, and other electronic products at its disposal. Micro environmental factors include the customers, employees, suppliers, shareholders, media, and competitors. Dell has to satisfy the needs of its customers, and it has fulfilled this objective ever since its founding. Michael Dell was first to introduce the build-to-order PCs in the market; the customers loved the concept. Now, with its long line of PCs, desktops and laptops, electronic products, accessories, and printers, Dell continues to satisfy the customers. Additionally, Dell employees are a part of a team. Building a PC alone allows them to work with unity and coherence. Employees continue to have “collaboration, innovation, a commitment to revolutionary thinking” (Dell (c), 2009). This means the people are well motivated in building and selling Dell products and in dealing and building a strong relationship with customers. The financial crisis will also affect Dell employees. Downsizing can impact on the strength of the company. Suppliers may also suffer in this crisis. Dell may resort to going abroad, like China, in searching for cheap supplies to its PC products. Competition is another factor. It is said that the PC may soon give in to other electronic appliances which are “intelligent”. Many of the appliances at home, nowadays, can be connected with each other, so that the PC may have to make a sidestep on this development. Another micro environment factor is the shareholders. “As organisation requires greater inward investment for growth they face increasing pressure to move from private ownership to public.  However this movement unleashes the forces of shareholder pressure on the strategy of organisations. Satisfying shareholder needs may result in a change in tactics employed by an organisation.” (Learn Marketing.net) For this, Dell has to balance its strategies between the public and its shareholders. Michael Dell may not be in a hands-on management at Dell nowadays but he has to take into consideration the many shareholders who have been there since its inception. B. Propose segmentation criteria to be used for the Dell printers This is looking for a specific target market for Dell printers. “The objective of segmentation is to group individuals so that their collective response to marketing inputs is similar.” (Jobber and Lancaster, p. 172) The DELL V305 3-IN-1 PRINTER (Dell website) is conducive for the home, but we suggest that this can also cater to the offices or a larger coverage. Dell offers big discounts for its computers and printers. Dell’s V505w All in One (Product) RedTM is a discounted printer suited for offices, shops and internet cafés or small and medium businesses. Other printers also fit for homes, offices, shops and internet cafés are: Dell V505 All in One, Dell P703w All-in One printer, Canon PIXMA MX 850 Office All-in-one Multifunction Printer, Kodad, ESP 5 All-in-One Multifunction Printer. Some of these printers have discounted prices of up to $30.00. (Dell (d), 2009) Robert (1998, p. 207) says that ‘One of the disadvantages of the market segmentation approach is that it leads to generic products, and to generic prices. Because all products are very similar, so are the prices. And most transactions have a tendency to drift to the level of ‘low price wins,’ because customers see no difference in one product compared to another’. Moreover, Dell also has the SMALL and MEDIUM BUSINESS DEALS. This is for a wide array of laptops, desktops, monitors, printers, electronics & accessories. Aside from the small and medium, Dell also serves the enterprise category, which has the Power Edge Performance Tower Servers which can serve up to 25 employees. (Dell (e), 2009) C. Factors which influence the choice of targeting strategy Dell targets homes, offices and industries with its superior brand of PCs. Other accessories also go along with the PC, and the target may be almost the same. The name Dell is always associated with the PC. Now, its laptops and notebooks have been targeted to the young demographic, mostly students, graduate and undergraduate, young professionals and executives. Laptops and notebooks seem to be the status symbol of the young, business executives, employees, students, etc. This is the target of Dell. But, moreover, it also serves industries, buildings with several floors of offices. Dell targets business, offices, and any area of life which deals with computers and high technology. D. Explain how buyer behaviour affects marketing activities for printers. Understanding buyer behaviour is important for salespeople and the company. In selling its printers to the public, Dell has to consider factors such as loyalty on the part of the customers. The printers are unlike the PCs of which Dell is well known of. Therefore, it has to analyse first the market. Howard and Sheth (1969, cited in Jobber and Lancaster, 2003, p. 39) identified three types of buying situation: 1. Extensive problem-solving – this occurs when a need arises on the part of the buyer; he will conduct extensive problem solving, and therefore he/she needs some information to help him in the process of examination. In this situation, the salesperson can have the opportunity of creating goodwill with the customer. In the case of Dell printers, the customer can be provided with a list of the numerous types of printers, which are all top of the brand. This problem-solving situation can be an opportunity for Dell salesman (in a store) to provide the need of the customer. 2. Limited problem-solving – “occurs when the consumer has some experience with the product in question and may be inclined to stay loyal to the brand previously purchased”. (Jobber and Lancaster, p. 39). 3. Automatic response – Dell can use the automatic response through advertising since it has the name or the brand, and personal selling is not anymore required. A loyal Dell customer will just go to the store selling Dell printers, once he sees the advertisement through the different media. Task 3 - Individual elements of the extended marketing mix The original marketing mix elements are product, price, place and promotion or the 4 Ps. Because today, marketing is more customer oriented, there are added elements to the mix, and they are called extended elements; these are: 1. Physical layout – this pertains to the physical layout of the factory or shop or any business establishment where the customers would like to take a look or visit. 2. Provision of customer service – this pertains to how service is given to customers, whether the staff or employees give the customers extra care and attention in order for them to be loyal to the organization. 3. Processes – these are the processes involved when the customers would want to complain or ask that their needs be met right away by the organization. (The Times 100, 2009) A. How Dell’s products are developed to sustain competitive advantage Dell’s products, particularly PCs, printers and other accessories, have been developed by well-trained and experienced technicians. Although Dell outsources some of its supplies for the PCs, these products are developed and handled with real quality and care. In its website, a customer can select various models of a particular product. For example, a desktop can be selected from the many models, and can be compared with Dell precision workstations. The website says: “Dell offers workstation lines that can meet a wide variety of business needs.” (Dell, 2009) In this so-called work station, the models are described that include the processor brand, the Windows installed and available, maximum memory, maximum hard drive, RAID Support, Graphics Memory, PCI, dimensions, and so forth. (Dell (f), 2009) B. Explain how distribution is arranged to provide customer convenience. Do you think Dell’s distribution strategy has been successful? Dell has many outlets all throughout the country and in every state, so that once an order is done online, this is immediately handled by a responsible employee monitoring round the clock, and the ordered PC or any item is delivered within 24 hours. This is an effective and successful strategy of Dell that serves customer convenience. Dell’s distribution strategy is effective and tested through time. Michael dell has perfected this when the company was still young. Now with branches all throughout every state, and in many parts of the world, distribution is not a problem. Moreover, manufacturing plants have been installed in many parts of the country, which makes it possible to deliver a custom built PC anytime an order is made. C. Explain how Dell’s prices are set to reflect their objectives and market conditions. Dell’s prices make it distinct or different from competitors. Many of the prices are discounted to meet their objectives. For example, their printers are discounted $30. Laptops prices range from $399 to $599, and these are discounted from $30 up to $149 savings. They are really apt to customers’ satisfaction. Their wide range of products, electronics, and accessories, can meet the needs and wants of the customers. D. Illustrate how promotional activity is used to achieve marketing objectives. Dell services include professional advice to customers. Here’s this portion of the website which says “SMALL BUSINESS, SMART ADVICE” (Dell (g), 2009). This is truly one of a kind for a flourishing company of the 21st century in the midst of the global financial crisis. This program features advices on business ownership, marketing strategy, technology solutions, industry strategy, and other expert advices. It also features how to improve your business, cut costs, or solve a complex problem. This is truly one of a kind. Task 4 –Apply the extended marketing mix to different marketing segmentations and contexts Dell has achieved segmentation and can now clearly concentrate and aim its marketing mix, including its promotional effort, at a particular target market. The main marketing elements involved in achieving this goal are selling and advertising. Dell’s printers are of the highest quality. This can meet customers’ taste and specifications. Through sales promotions, Dell should encourage repeat purchases of customers, build long-term customer loyalty, widen or increase the distribution of their printers. Sales promotion for the printers may include price reductions and coupons. Consumer promotion is also encouraged, and this includes price reduction or price promotion. Differences in marketing products and services to organizations and to consumer Marketing to organizations involve a more complex method of conducting sales. An organization has personnel to decide what products and services are needed for them, which is very different when conducting business with a consumer. Organization may need a number of products to suit their needs. In marketing products to organizations, we should consider the size of the organization. The products that we should market can cope with the organization. C. Difference between international marketing and domestic marketing Success depends on the attitude and approach of the firm and the personal qualities of the salespeople, and not every salesperson is suited to such a task, he/she must be trained for international market. China has not only entered the international market, it has dominated the international scene with “Made in China” products, mostly cheap products, so that now it is really difficult to export products because of this situation. If one company has to compete with such a giant exporter of almost all kinds of goods, it will surely fail. Dell may has been an exporter, and although it may not be able to compete, it can tap China as a supplier, of which other companies have been doing. References Blythe, J., 2006. Principles & Practice of Marketing. London: Thomson Learning Dell Computer website. 2009. Available from: http://www.dell.com/ (cited 9 February 2009). Dell Computer (b), 2009. Dell laser printers & all-in-one printers. Available from: http://accessories.us.dell.com/sna/category.aspx?c=us&cs=04&l=en&s=bsd&~ck=anav&category_id=4014 (cited 9 February 2009). Dell website (c), 2009. Our opportunities can’t be beat. Available from: http://www1.euro.dell.com/content/topics/global.aspx/corp/careers/welcome/default?c=uk&l=en&s=corp (cited 10 February 2009). Dell (d), 2009. Photo Printers. Available from: http://accessories.us.dell.com/sna/category.aspx?c=us&l=en&s=bsd&cs=04&category_id=6792&~ck=bt (cited 10 February 2009) Dell (e), 2009. Power edge performance power servers. Available from: http://www.dell.com/content/products/category.aspx/tower?c=us&cs=04&l=en&s=bsd (cited 10 February 2009) Dell (f), 2009. Dell precision workstation computers. Available from: http://www.dell.com/content/products/category.aspx/precndt?c=us&cs=04&l=en&s=bsd&~ck=mn (cited 10 January 2009). Dell (g), 2009. Small business, smart advice. Available from: http://sb360.allbusiness.com/?~ck=mn (cited 10 January 2009). Lancaster, G. and Reynolds, P., 2005. Management of Marketing. United Kingdom: Elsevier Butterworth-Heinemann Learn Marketing.net. Micro environmental factors. Available from: http://www.learnmarketing.net/microenvironment.htm (cited 10 February 2009). Mariotti, J. L., 2002. Making Partnerships Work. United Kingdom: Capstone Publishing. Oxford University Press, 2007. PESTEL analysis of the macro-environment. Available from: http://www.oup.com/uk/orc/bin/9780199296378/01student/additional/page_12.htm (cited 10 February 2009) The Times 100, 2009. The extended marketing mix (7Ps). Available from: http://www.thetimes100.co.uk/theory/theory--the-extended-marketing-mix-(7ps)--319.php (cited 10 February 2009). Read More