Creating a Successful Internal Marketing Plan - Term Paper Example

Table of Contents Introduction……………………………………………………………….. 2 Concept of Internal Marketing…………………………………………… 2 What is a service product?........................................................................... 3 Importance of internal marketing to service product…………………… 3 Values in internal marketing............................................................ 4 Internal marketing in bank…………………………………………. 5 Introducing the internal marketing program to the organization……… 6 Strategies for a successful internal marketing program………………… 7 Set measurable goals………………………………………………. 8 Segmentation ……………………………………………………… 8 Methods of communication ……………………………………… .. 10 Guerilla marketing………………………………………………… 10 Comments and discussion………………………………………………… 11 List of references ……………………………………………………… 12 Creating a Successful Internal Marketing Plan: Introduction Many companies devote much time and resources in developing external marketing to develop customers. But there are times the customers won over by these strategies are lost because of internal inefficiencies. There are incidences that first line-employees who face the challenge of meeting customers do not really represent the interest of the company. When questioned about goals of the service product they are promoting, they are mum on the subject. What does this incidence mean to the business? Certainly, the patronage and loyalty of the customer to the product/service will be somewhat affected. In this context, an internal marketing plan is needed for a product service organization if it wants to remain afloat in the business. This study looks at the reasons for the need of an internal marketing plan and proposes strategies of creating a successful internal marketing plan. 1. The concept of internal marketing Internal marketing has been defined as a “management philosophy of promoting the firm and its policies to employees as if they are (internal) customers of the firm. (Business Directory.com) It is a management tool or strategy which is similar to the external marketing strategy but this time, it is applied to employees of the company. As such, internal marketing is also a promotion of the company. BPP CIM (1991) touched the issue as one of sales promotion tools in a way; that company also identifies the target market, creates a suitable package, delivers the package and evaluates results within the organization. Employee behavior plays an important role in internal marketing as BPP CIM observed that overt tactics cannot be used in this plan because of possible employee resentment. BPP CIM suggests that art and talent be used by the marketing department in conveying the messages to colleagues. One of the strategies mentioned is the use of marketing communication. 2. What is a service product? A service product is a kind of product that focuses on the needs of customers and their expectations. It is a sector in the economy composed of the government, tourism, banking, retail, and social services. As a service product, it is result oriented and output is expressed in terms of information, service, attention, advice and experience. WiseGeek has drawn examples of this sector, to include Franchising News media, Education, Hospitality industry (e.g. restaurants, hotels, casinos), Consulting, Legal practice, Healthcare/hospitals, Waste disposal, Real estate and Personal services Business services 3. Importance of internal marketing to service products The first line of defense of a business organization is its sales people and employees. They are the members of the company that meets the customers; they are in direct contact with them either thru the phone, online, or face to face. As such, a great deal of customer relationship will depend on their knowledge, attitude and loyalty to the company. This is where internal marketing tools play an important role. According to BNET who made a report about Planning Internal Marketing, said, fully informed personnel will be committed to the vision of the company and will be an instrument in building a long-term customer loyalty. BNET suggests that management should invest on internal marketing tools with the “customer-facing staff” in order to build strong customer relations. In the end, BNET says, it is a more cost-effective strategy that will help the organization as the employees become “product champions”. Values in Internal marketing The importance of internal marketing has been emphasized in the study done by group of students under Professors Frank Milhelm and Don Schultz of Northwestern University and has been reported in the FORUM. This study conducted in 2005 sought to identify the best internal marketing practices of twelve identified companies from different sectors in the United States. Findings showed that these companies believe on the importance of the role of employees in the success of the business. They also share the same values “that in IM people matter, it drives performance, anyone can make a difference and loyalty of employees is critical”. This means that in IM, employees are the main focus for all these initiatives. Companies identified in this study represents various sectors in the industry are large US companies, and are listed below: Source: FORUM Value creation is also given due process in the study done by Keller, Scott B, et. al. (2006) on their study about the impact of internal marketing efforts in distribution service operations. Added value may be the kind of service and information provided by frontline employees; subjectively assessed by customers and the perceived power of relationship between the customer and the front line employee. Thus, in this study, it has regarded the importance of providing the proper logistics to frontline employees such as IM. Findings in this research support the view that IM done on an interpersonal level is related to the satisfaction and high performance of distribution center employees and increased their customer orientation. Internal Marketing in banks IM is considered critical in the banking service sector, as duties of front line employees mostly consist of direct interaction of banking transactions with clients. Two separate journal articles about the importance of IM to banks have been done by N. Bouranta, G. Marvindogdon and P. Kynazopoulos (2006) and that of Richardson, B and Robinson, g. (1986). Both studies accentuates that customer satisfaction depends on the process of service delivery. Research findings on Greek banks showed that actual performance has a linkage to IM and market orientation of the employees. Data gathered from research in retail banks showed communication motivates the employees and initiates a p Research findings on the study of customer service in a retail bank confirmed that the value of communication motivates the staff and creates an encouraging feeling of one who belongs.. Aside from this, customer satisfaction becomes a competitive edge against other banks offering the same retail services 4. Introducing the internal marketing program in an organization. First step in implementing an effective marketing program is to have a two way communication between the management and the employees. Management should let the employees share the company culture and goals; they should understand the company’s missions and visions as well as the policies and procedures. Initially, this is done by Human Resources Department during the hiring process of an employee, but a follow up should be done by the Marketing Department. Employees should be properly informed of any important changes in the organization. BNET sums this up as coming up of new products and acquisitions. Important news, sad or happy ones should not be kept from the employees such as downsizing, mergers, and other forms of alliances. Explanations should be provided to all stakeholders and employees when there are changes in brands and values. BNET said that employees and stakeholders will be more committed to the organization when they understand the situation. A feeling of greater involvement will drive them for better customer relationship. The line of communication established by internal marketing brings management and employees closer in working towards the same goal, whereas organizational change loosens the ties, BNET stated. The Internal Market program, timing and participants There are signs in the course of the business that signifies an internal market program is needed. BNET recognizes these signs when the following incidences occur: There are high levels of customer complaint with service standards The complaints can be attributed to poor performance by staff that are not in direct contact with customers, although some staff may be. The problems cannot be overcome by quality actions or by change to the physical processes. The problems are rooted in poor staff attitudes or a lack of understanding of customer needs. There is no mechanism for the key staff to learn about customer needs; the staff is trained in technical skills but have no experience in customer care. Customer concerns can be identified through surveys and questionnaires; and it is possible to get specific comments from customers. Source: BNET Editorial An internal marketing program should be designed not only for the “face-line” employees but should include other employees as well. It is important that employees understand the complaints of customers and to trace the roots of complaints. Errors may come from the “hidden employees” such as those in the Accounting personnel who typed a wrong billing of invoice. Customer’s complaints may also come from the delivery service who delivered a wrong package or technical complaints to products which were not transmitted to service technicians. Customers never get to meet the people who are directly in charge of production or services as there are barriers of management tiers that go between them. Strategies for an Internal Marketing Program First step is to make a plan that recognizes the perceptions of the staff, the management and the customers towards the company. This will help marketing staff to know where to begin. Perception will identify the gaps of what the staff believes the company to be, what the managements wants to be and what the customers see in the company. BNET says that when these three components of the business are in harmony with each other, the business becomes customer-focused. A customer focused company will not be afraid of competition. Communication forms the heavy part of internal marketing plan and should include the following factors in the development of strategies. Review of internal perceptions, target perceptions, current internal marketing activities, internal marketing objectives, key messages, communications strategy and program measurement (BNET) Communication in forms of anecdotal feedback and surveys is one way of staying in touch with customers and has been suggested by Gumpert (p.121) in creating a successful marketing plan. Gumpert, in his study, stated that are also informal ways of knowing perception of customers thru the salespeople and other employees who come in contact with customers. Other staffs like clerks, secretaries and messengers hear comments from customers and may provide vital information about customer’s expectation and industry changes. Set Measurable Objectives The challenge to Marketing people is how to put all the information gathered, in a meaningful way to arrive at measurable goals and objectives. In doing an internal marketing program for a service product, the overall objective is to be able to get the employees to unite with the company’s service products. Kotler, P. and Bloom P, (p.50) both Marketing experts, stated that a service organization must clarify its goals and determine how best to go there. In designing an internal marketing program for a service product, the goals should raise the levels of awareness of the product; ensure that employees understand the key messages of the product. The program should encourage staff to recommend the product to colleagues and to customers be able to raise curiosity of website visitors to the product/service, and encourage employees to attend in internal events. Segmentation External marketing uses segmentation to focus a target market. In the same way, there is a need for segmentation in the internal market as employees have different behaviors that are either supportive, opponent or neutrals. BNET says in their study that because of human differences, a homogenous group is rarely formed, and methods of approaches will be done for each other. Nonetheless, everything sums up in sharing information openly. Methods of communication Relaying of information is partly one way of promotion and internal marketing BPP CIN points to segmentation, positioning and consumer behavior in external marketing with use of marketing communication. BPNet shares this view that it recognizes segmentation of employees according to behavior and promoting the company to its own internal customers. But what differ in their approaches are the tools used to communicate. BPNET proposes use of multimedia in internal marketing. Some of media that could be used to different audiences are e-mail to employees with the use of sophisticated video presentation. Ram Charan (Junta4) suggests that intranet information should be done regularly or at least every two weeks, otherwise, employees may think of some kind of cover ups. Web casts and on line bulletin delivers fast messages to employees; posters, intranet advertisements, screensavers, or desktop items can act as visual reminders of important internal messages. BPNET and BPP-CIN both consider use of guerilla or viral marketing to deliver key messages. Guerrilla marketing has been described in Wikipedia as a non traditional system of promotion relying on the imagination, energy and time. It is low cost promotion that sends out messages to targeted consumers in unexpected time and places which makes the idea being marketed memorable, thus creating a buzz or a spread. Follis Guerilla Marketing used mobile billboards that motored around the city with a message conveyed about an event. The campaign was effective as it caught the eye of many people and contributed to the success of event. In another occasion, the Marble Church in NYC wanted to reach vacationing youth on the beaches. An airplane carrying a banner with a message “Make a friend in a very high place” Marble Church.org.” Church attendance increased as a result of this guerilla campaign. Source: follies Guerilla Marketing There are countless ideas that can be used internally to convey messages to employees and viral marketing can be one of them. Comments and discussion There are many ways to convey information to the internal customers of the organization. But what are important are the openness, sincerity and continuity of the program. One can easily feel if the program is not honest, by then, the program will only be a waste of resources and does not help the company at all. The objective of internal marketing program is to sell and promote the company to its own employees so that they will have the commitment and loyalty to become the company’s own agents, representatives championing its causes of service products to customers. End. W.c. 2619 List of references BNET Editorial, Planning Internal Marketing, Available from [01June 2009] - - - Target the right internal customers, Available from http://www.bnet.com/2410-13237_23-168356.html [01June 2009] - - - Use multimedia to communicate, Available from [01 June 2009] BPP-CIM,1991, The role of planning, Diploma: Marketing Communications. BPP Publishing Ltd., London, (p. 30) - - - “Sales Promotion Tools” Diploma: Marketing Communications. BPP Publishing Ltd., London. Bouranta N, G. Mavridoglou and P. Kyriazopoulos May 2005, The impact of Internal Marketing to Market Orientation concept and their effects to bank performance. Operational Research Journal, Springer Berlin/Heidelberg, Vol 5, No.2. Available from http://www.springerlink.com/content/67t8031387l111u3. [03 June 2009] Brian A. Richardson, C. Grant Robinson, 1986, The impact of internal marketing on customer service in a retail bank. International Journal of Bank Marketing, MCP UP Ltd. Vol. 4, Available from http://www.emeraldinsight.com/Insight/viewContentItem.do?contentType=Article&contentId=1656654 [03 June 2009] Business Dictionary. Definition – Internal marketing. Business Directory.com. Available from http://www.businessdictionary.com/definition/internal-marketing.html [01 [June 2009] Follis Guerilla Marketing, Guerilla Marketing,Available from [01 June 2009] Gumpert, D. E, 1994, Staying in touch with customers, how to really create a Successful Marketing Plan. Inc. Magazine. Goldhirsh Group Inc. Boston, MA, p. 121 Keller, Scott B, Lunch Daniel F, Ellinger, Alexander E., Ozment, John, Calantone, Roger. Impact of Internal Marketing Efforts in Distribution Service Operations (2006_ Available from http://findarticles.com/p/articles/mi_qa3705/is_200601/ai_n17181980/?tag=content;col1 [03 June 2009] Kotler, P. and Bloom P. 1984, Strategy formulation,. Marketing Professional Services.Prentice Hall, Inc. N.J., p.50 Milhelm, Frank and Schultz Don, n.d., Internal Marketing Best Practices. FORUM, Available from http://www.performanceforum.org/internal_marketing_best_practice_study.63.0.html [03 [June 2009] Wikipedia, Guerilla Marketing, Available from [01 June 2009] Wise Geek, Definition – Product service system, Available from http://www.wisegeek.com/what-is-a-product-service-system.htm. Wise Geel . [01 June 2009. Read More