Importance of Proper Communication for the Success of Marketing Strategy - Research Paper Example

 Marketing Communication Table of Contents Introduction 2 Smiths group 3 Smiths Interconnect 5 Markets of Smiths Interconnect 5 Competitors of Smiths interconnect 6 Objectives 6 Element of marketing communication 7 Guiding factors for selecting marketing communication mix 9 Elements for marketing communication for Smiths interconnect 11 Strategy for marketing communication methods 13 Cost Involved 15 Methods for measuring the effectiveness of the marketing communication 15 Conclusions 16 References 17 Introduction Communication can be referred as the process of exchanging meaningful informations, opinions or thoughts in the form of writing, speech or even signs. The proper process of communication involves different elements like sender, receiver and channel. Firstly, the sender initiates the message, which reaches to receiver through a channel. Sender sends the message in an encoded form which is decoded by receiver according his/her understanding. Finally, the receiver gives the feedback. Various communication barriers like noise could be present in the channel which can distort the clarity or the form of the message. Communication is its best when receiver receives message without any distortion in it. Channel could be of two types, formal and informal. Communications can be interpersonal and organizational. Interpersonal communication can be of two types, verbal and non verbal. Oral and written are the two types of verbal communication. Organizational communication can have two forms, formal and informal. There are different directions of organizational communication, upward, downward and lateral. In this globalised and competitive world both interpersonal and organisational communication is very crucial in order to achieve success. Whereas according to American Marketing Association Boston, marketing can be defined as “the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large”. Marketing comprises of identifying the target market, developing new product or new aspects of existing product, developing pricing, promotional and sales strategies, selling the products and finally providing proper after sales services and taking feedback. Today marketing is very important for the success of any product or any brand (AMA Boston, n.d.” Definition marketing”). There has to be proper communication for the success of any marketing strategy. Success of the product, pricing, promotional, sales and after sales strategies largely depend on how they are communicated not only to the customers but also to the employees and the business leaders. In fact success or failure of any product or brand is directly related with the success failure of communication process of their marketing strategies. Again proper strategy has to be adopted to communicate all those necessary information regarding the product, price, promotion and place. So it is clear that marketing and communication both are interconnected and success of one is dependent on the other. Smiths group Smiths group is an UK based global technology company, was founded by Samuel Smith in 1851. Today it is renowned as Smiths Group Plc. This London Stock Exchange listed company has its headquarters at 80, Victoria Street, London. There are five different major business divisions of Smiths group, namely Smiths Detection, John Crane, Smiths Medical, Smiths Interconnect and Flex-Tek. According to their website, all these divisions “are focused on the threat & contraband detection, medical devices, energy, communications and engineered components markets worldwide. Our customers range from governments and their agencies, to hospitals, petrochemical companies and equipment manufacturers and service providers in various sectors around the world” (About Smiths, n.d.). Smiths detection design and manufacture various high end technology products which are government regulated and used to detect and identify explosives, narcotics, weapons, chemical agents, biohazards and contraband. It is a division of the Smiths group and is leading the world transportation security market. John Crane, another important division of Smiths group, is renowned for designing and manufacturing seals and other associated products which are used in oil, gas, chemical and pharmaceutical and mining sectors. According to its website, the company has its presence in fifty countries with over 6000 people and twenty manufacturing sites (John Crane - UK Ltd. n.d.) Smiths group’s third division namely Smiths medical, whose main objective is to bringing medical technology to life, is a leading name in manufacturing various medical equipments for hospitals, emergency, home and special environments. There are 7500 employees in the company and has its manufacturing sites in US, UK, Italy and Mexico (About Smiths Medical. n.d.) Smiths interconnect provides high end technology (electronic and radio frequency) solutions mainly for telecommunication, defence and aerospace sectors. Company employs around 3500 people. According to the information given in the company website, in 2008 Smiths group’s 11% sales and 18% operating profit came from Smiths interconnect (Business review: Smiths Interconnect. n.d.) Flex-Tek, the final vision of the group supply various engineering components which is used to heat and move fluids in aerospace, industrial, construction and medical sectors. Smiths Interconnect Smith Interconnect, a major division of Smiths group, deals with high end electronic technology components sub-systems business, which provides some specific solution in signal, power and microwave field. Company markets its product to defence, telecom and aerospace sectors. According to the company’s website major customers are Raytheon, Finmeccanica, BAE Systems, AAI/Textron, Northrop Grumman, Ericsson, Motorola, Sprint Nextel, ZTE, GE Medical and Alstom. Markets of Smiths Interconnect It is a globally operated company under the leadership of Ralph Phillips. Its located in US, Mexico, Costa Rica, Ireland, UK, France, Germany, Italy, Tunisia, India, China and Australia. Defence and telecom are the two major market of Smiths Interconnect. Company’s divisional headquarter is in United States. There are five different technology groups under the Smiths Interconnect. These are microwave sub-systems, connectors, protection, interconnect wireless technologies and high reliability components. The high-tech sectors like Mobile Directional Antenna System, War-fighter Information Network, and Navy Multiband Terminal have been the major markets for the microwave subsystems. Various military programmes by US are driving the sales growth of microwave sub-subsystems. Connectors has wide range of markets starting from industrial rail traction and test & measurement markets of Europe to the emerging medical markets of the Asian economy like that of China. Defence sector is an existing market for connectors. According to company’s website its connectors are selected for future NASA space program. Protection already exists in the market of wireless infrastructure and the broadband network (within the United States). It is also trying to get into the defence sector. Interconnect wireless technologies (IWT) provides solutions for wireless communication infrastructure market and assists microwave sub-systems. The final one that is high reliability components (HRC) are already operating in the military and space sector. Competitors of Smiths interconnect There are different competitors for different sections of Smiths Interconnect. According to the company’s website major competitors of connectors are Amphenol, Deutsch, Radiall and Souriau. In microwave component section main competitors are Anaren, Spectrum Control and parts of M/A-Comand Dover. Cobham, EMS Teledyne and L3 are the major competitors in case or microwave sub systems and lastly Huber & Suhner, Dehn and parts of SL Industries are the challenging competitors in the field of protection. Objectives Few of the prime objectives to be achieved by the Smiths Group are that of increased market share and increased revenue. Marketing communication plays important role in meeting towards such objectives. The objective of this project is to get a clear idea about the concept of marketing communication and its application in a real organisational scenario. Here Smiths group, more specifically Smiths Interconnect has been taken as an example for the application of various concepts and elements of marketing communication. Element of marketing communication Marketing communication mix is comprised of different marketing communication elements. These are needed to be followed to achieve various marketing objectives. These elements are as follows: Advertising – Advertising is one of the most effective communication tools because it can address huge number of widely spread customer at once. It is very effective in introducing new product, informing the customers about the product, reminding the customers about the product or brand and triggering the sales. Smiths Interconnect can adopt various advertising strategy to increase the brand awareness and to push the sales. But company provides high end technology solutions which are not used by common mass. Company’s products and services required business to business marketing where advertising strategy, which attracts the common mass, is not the best strategy. So, the company can take up corporate advertising strategy. It can advertise its brand in various corporate events, corporate news channels, and seminars. Sales Promotion – Sales promotion is an important element in marketing communication mix. Sales promotion includes providing discounts, premium offers, providing coupon facility, organising interesting contests, etc. Sales promotion is taken up with the objective of reaching higher sales figure at a short span of time. Generally it is done to clear the piled up stocks. There are various sales promotion strategies to motivate the sales people so that they can provide better sales performance. Smiths interconnect can give various attractive sales promotion offers to its few selected customers, who are loyal to get some large orders. Attractive prizes or facilities could be given to those persons who are mainly responsible of the purchasing process. They can give some special offers or attractive gifts to its premium sales persons to get better results. Public Relation – Public relation is one of the important promotional strategies. Its main objective is to create or increase the brand awareness in the market. It includes various promotional events, advertorials, formal press releases etc. It is done through different types of media like electronic and print media. Smiths interconnect are high-end technology based products, which require business to business marketing communications. Public relation is usually very effective for this type of marketing communication. So, the company should provide enhanced importance on public relation. The management should promote their product in various events, seminars and summits of defence and telecom departments of various countries (McNamara.C, n.d. Free Mangement Library.) Direct Marketing - In direct marketing customers are directly approached by direct mail, by telemarketing or by various online marketing approaches. Smiths interconnect’s high-end technology products can not be sold presumably through direct mail or online marketing. To understand various product features and specifications both the sales person and the customer have to be highly knowledgeable in terms of various technology aspects of the products. Both the parties have to understand the advantages and the limitations of the products. This calls for physical interaction between the buyer and the seller. Personal Selling – Personal selling is the process of persuading or influencing the customer personally through face to face meeting, to make him/her purchase the product. The seller must have excellent convincing skills and sufficient product knowledge. This selling technique would be very effective in case of Smiths intrconnect’s high-end electronic technology products, because to sale those products person must have high level of product knowledge and enough convincing skills (Marketing communications II –personal selling. n.d.) Guiding factors for selecting marketing communication mix Marketing communication strategies are adopted to achieve certain organisational objectives. So these strategies are selected considering certain important factors. These are as follows: Type of products – Selection of communication strategies depend on the type of product to be marketed. It has been found from various marketing surveys that sales of FMCG products is heavily influenced by various sales promotion and advertising activities, whereas to increase the sales of industrial and technology products personal selling is more effective. Buyer readiness – Selection of appropriate communication mix is also dependent on the extent of readiness of the potential buyer, because if potential buyers are not ready for a particular product communication mix should be chosen in such a manner that it make buyers feel that there is a need of such product that is increasing the level of readiness of the potential buyers. If Smiths interconnect come up with such a product for which the defence or the telecom sector is not ready or if there is any problem in the process of implementation in terms of infrastructure or other facility, then communication mix should be in such a way so that it make the market feel that there will be high requirement of this technology for the better performance. If customers are convinced then they would be taking initiatives to build the required facility, and this would increase the level of readiness of the buyers. Product Life Cycle – All the products go through a certain life cycle, which include different stages like growth, maturity and decline. Different communication strategies are adopted for different life cycle stages. For example, if any product of Smiths interconnect is there in market for quite a long time and sales of that is not increasing any more even after incurring enough promotional activities, means the product is in its maturity stage and sales has reached to the saturation point. If sales is falling gradually then the product is in decline stage and there is no need for spending much effort behind its communication activities. Elements for marketing communication for Smiths interconnect Since Smiths interconnect deals with high end industrial technology products, the company has to operate in a business to business mode, where selection of proper marketing communication method is crucial. In business to business mode negotiation is very important as both buyer and seller are reputed organisations, have strong bargaining power. As a result it is very important to adopt the right marketing communication element. Microwave sub-systems of Smiths interconnect is already quite renowned in US department of defence. It is already a well established brand in that particular market. So company can utilize this image to get a new market as a form of other nations defence department. Personal selling strategy is instrumental in this case. Company can target different defence delegates of other country. Brand awareness can be enhanced by different public relation strategies. Company can target various defence shows in different countries as a platform to promote their brand. They can take help of industry experts of repute, who have good rapport with the defence department of other nations to create a new market. Personal selling technique is also very effective for connectors. Already it has market in Europe and Asia apart from US. Developing countries can be targeted for the connectors as it is generally made for rail tractions. To venture in to the medical markets it might apply the channels like public relations or sales promotions. Direct marketing or personal selling could be useful marketing communication tools for the protections, since it deals with wireless technology and broadband connection. So, it is clear that for Smiths interconnect where marketing is in business to business mode, personal selling, public relation and direct marketing hold the key for marketing communication. Strategy for marketing communication methods As there are various marketing communication methods, it is important to choose the appropriate strategy in order to reach the desired business goal. Following strategies would be appropriate for Smiths interconnect. Personal Selling – Personal selling is most appropriate strategy for business to business model. As it is already discussed that, kind of product Smiths interconnect is dealing with require excellent level of personal selling. Person who will be directly in charge of that selling must have all the details regarding the product details, advantages and limitations. Person must have fair idea about the requirement of the customer, because according to that product details need to be presented. It is also important to have all the informations about the competitors’ position. Direct Marketing – Direct marketing is all about mailing or calling the customers directly to market the product. Here the timing of approach is very important. Direct marketing is used to get the appointment to meet the customers physically. Protections of Smiths interconnect require direct marketing as it is dealing with wireless technology and broadband services. A corporate meeting can be arranged with the concerned person of purchasing company by directly mailing or calling him/her. Methods can be useful in case of existing customers of Smiths interconnect as it is a already established brand to them. Public relations – Smiths interconnect can use public relation as an effective tool of marketing communication. It can organize as well as participates in various defence events, seminars and shows of countries apart from US. As it is dealing with advanced technology products it can publish souvenirs to elaborate the usefulness and effectiveness of that particular technology. Various advertorials in magazines which deal with technology based products can prove to be useful technique to enhance the brand image. They might take up sponsorships of certain governmental programmes to create good relations with various governments. Sales Promotions – Attractive discounts and offers are the examples of sales promotion strategies. As customers always want to get product at the cheapest possible price, discounts, offers and personal gifts could be proved to be useful. Smiths interconnect might use these strategies in case of its telecom customers. Existing customers could be treated as a subject of these strategies. Exhibitions – Since the company provides high end technology solutions, products are quite complicated in terms of their use and features. So there might be requirement of proper demonstrations of the products before selling the same. Company might organise various exhibitions and shows, where proper demonstrations of the product would be given. This will help the customers to understand the usefulness product which eventually help them to take the right decisions regarding the purchase of the product. Cost Involved Total cost of marketing communication would depend on the choice of strategy. Since in case of Smiths interconnect advertising is not an effective strategy cost would not be much higher. Because in case of advertising lot of cost is involved in hiring advertising agency, medium like electronic or print etc. In case of public relation cost is involved in giving advertorials in various magazines, organizing shows or events etc. Again in case of sales promotion there are costs of giving discounts and offers. Total marketing communication cost would be the addition of all the cost involved in each of the communication strategy. Cost is also dependent on the type of products in the sense that strategy would be selected based on the product. Methods for measuring the effectiveness of the marketing communication Measurement of performance is very important in know the extent of growth or decline of the performance. Effectiveness of the marketing communication could be measured by assessing the advertising performance, where recognition and recall of the brand, purchase behaviour. Ability of the sales force to utilise the market intelligence, customers follow up, implementation of the program and finally fulfilling the objectives are considered for the measurement of the personal selling. To measure the effectiveness of the direct marketing focus group discussions and eye tracking for the layout are used as the methods (Marketing Communications. n.d.) Conclusions The essence of communication in our life can be understood from an observation of the noted American psychologist, Rollo May, “Communication leads to community, that is, to understanding, intimacy and mutual valuing”. Marketing communication is one of the most important factors behind success of any firm, and Smiths group as a reputed firm of 150 years is successfully applying all the communication mixes to achieve the desired objectives. References AMA Boston. No date. Definition marketing. American Marketing Association. [online]. Available at: http://www.amaboston.org/definition-of-marketing.html [Accessed August 14, 2009]. John Crane - UK Ltd. No Date. Official Website, [Online], Available at http://www.johncrane.co.uk/home.asp?r=uk [Accessed August 14, 2009]. About Smiths Medical. No Date. Official Website, [Online], Available at: http://www.smiths-medical.com/about-us/ [Accessed August 14, 2009]. Business review: Smiths Interconnect. No Date. Official Website, [Online], Available at http://www.smiths.com/ar08/smiths_interconnect.aspx [Accessed August 14, 2009]. McNamara,C. No date. Free Mangement Library. Basic Definitions: Advertising, Marketing, Promotion, Public Relations and Publicity, and Sales [online]. Available at: http://managementhelp.org/ad_prmot/defntion.htm [Accessed August 14, 2009]. Marketing communications II –personal selling. No.Date. [Online], Available at: http://www.download-it.org/free_files/c4546cb4e276774aed591699133342b2-Pages%20from%20Chapter%208.%20Marketing%20communications%20II%20-%20personal%20selling.pdf [Accessed August 14, 2009]. Marketing Communications. No Date. Case Studies and Management Resources [Online], Available at: http://www.icmrindia.org/courseware/Marketing%20Communications/Marketing%20Communications-DS18.htm [Accessed August 14, 2009]. Read More