Principles of Marketing - Case Study Example

Principles of Marketing Introduction Marketing has become a highly aggressive process in the current era of advanced technology. People have easy access to both the best quality products/services and to the up-to-date information about numerous alternatives. Therefore, marketers have to initiate novel strategies to persuade the consumers to purchase their products or service. However, People today are more selective, alert, enlightened and powerful. Traditional concept of shopping has been changed, and now conventional shops and outlets are at the verge of extinction. Hence, one must be aware of the major trends in the firm’s natural and technological environment in order to operate a successful business. The current socio-economic scenario compels organizations to review their marketing techniques. In order to update marketing, organizations have to conduct frequent marketing researches. The first part of this paper tends to discuss the major trends in the firm’s natural and technological environment. In the second part I will describe the common steps in the marketing research process. Trends in the Firm’s Natural Environment Natural environment is one of the macro economic factors that influence the ability of a firm to operate it successfully. The firm’s natural environment usually shows certain trends associated with the use/availability of raw materials and natural resource management. Organizations often confront with restrictions on natural resources management or in the supply of raw materials. Therefore, in order to overcome the unfavorable situation organizations should be cautious about the possible changes. Raw material is the essential element for the operation of an industry. Industrial operators usually locate their production unit close to the best accessible source. However, various factors like shortage of raw materials, governmental intervention, and growing environmental concerns etc, can create unexpected crisis in business operation. Environmental Issues To illustrate, environmental concerns have been growing all over the world in response to global warming and climate change. Exceeding level of industrialization and over exploitation of natural resources has been considered as the cause of this environmental collapse. Therefore, governments and various national and international organizations have initiated strong control over industrial operations. Business entrepreneurs have to comply with numerous regulations of pollution, waste disposal, and resource management. For instance, in India, the central and state governments have enacted numerous regulations associated with natural resource conservation program and eco-tourism. (Gupta V., Kollakota K. & Srinivasan R., 2007 p.145). Regulations Moreover, environmental pollution is another concern that has led to the legal restrictions on organizations. Many of the industrialized nations have passed strict regulations to control industrial emission of toxic gas/substances. For example, According to the Los Angeles County Code (LACC) title 20, Division 2, any business that would ‘generate, handles or dispose of industrial waste water must obtain an Industrial Waste Disposal Permit’(IWDPS) which will be issued by the Public Works’ Environmental Program Division (EPD) after examining whether there is adequate pretreatment systems (Industrial Waste Home, DPW). Ethical Issues Regardless of governmental intervention, firm entrepreneurs have the moral obligation to maintain environmental harmony in their business surroundings. Incessant pollution would not only harm the environment but also affect the sustainable business function of the firm. Hence in order to compensate environmental damage, a firm should define its own ethical perspective and strategies according to the natural trends. Shortage of Raw Materials Shortage of raw materials can occur due to the inadequate stock maintenance. An unexpected decline in the production of raw materials due to any sort of internal or external crisis in the supply unit can affect the uninterrupted function of a firm. In the same way, growing competition and escalating demand for raw materials also can cause material shortage. A firm should always foresee the market changes and possible material shortage in order to keep its position sustainable. In addition to stock maintenance, company should seek alternatives either in the form of substitute materials or new sources. Organizational Approach As Kotler & Armstrong (2001 p.118) states, companies can either passively accept market environment or they can be proactive by working to change the environment with an environmental management perspective. According to the writers, companies should try to be proactive at the changing trends. The recent developments in environmental concerns have encouraged organizations to develop new theoretical perspectives to contribute to the conservation of healthy ambiance. Today, environmental management is one of the inevitable functions of firms rather than mere procedure of legal compliance. “Many companies practice environmental auditing and reporting, have environmental departments, use environmental themes in advertising and public relations and even adopt green technologies and comprehensive environmental management systems.” (Hoffman & Ventresca, 2002 p.201). This is what meant by the proactive approach toward the natural management. Trends in the Firm’s technological Environment Modern organizations have been highly influenced by the enormous application of technology. The rapid pace of changing technology is one of the major macro environment factors. Technology based Human Resource Management (HR) is the main feature of advanced companies. Modern organizations have been highly benefited by the Human Resource Information System (HRIS). However, certain aspects of the technological dependence demand incessant changes and developments in the firm. The impact of such changes affects not only the HR management but also production, marketing, and structure of the organization. System design & acquisition issues The wide use of information technology is the major development in the technological environment. It has helped managements to coordinate workforce and to align their efforts regardless of distance or time. In contrast, the technological innovation demands the application of advanced methods which hike the annual expenditure. Moreover, most of the organizations confront with problems related to proper system design and acquisition. Therefore they need to hire the assistance of some professionals and vendor experts. The HRIS project manager should have the up-to-date technical and professional knowledge because system development and implementation are the significant stages of the HRIS project where specialized understanding is needed. Today HR systems are ‘ready with information management facilities, tools produced to customize forms, reports and server performance. These tools are applicable for human resources, financials, goods and documents management.’ (Litwin, Morzy & Vossen, 1998, p.356). Privacy issues & regulations The implementation of new technology like HRIS projects needs high alert because it deals with organization’s confidential data. Many managers are afraid of data privacy issues, vendor selection, planning, and development. In order to ensure the privacy, organization has to determine the limit of external involvement. System programming and maintaining need to be separated in order to prevent deliberate insert of vulnerabilities in the system. (Torres-Coronas, Arias-Oliva, 2008 p.473). In addition to the above mentioned factors, companies have to confront with governmental intervention and regulations on technological application. The major difficulty with the legal compliance is that regulations will always be inclined to consumers’ side rather than toward the entrepreneurs. For instance, a healthcare organization has to adhere to numerous regulations in order to reduce the undesirable consequences of technological application in diagnosis and experiments. Implementation and Maintenance Issues For small companies, the effective introduction of HRIS might be comparatively difficult because of the exceeding costs for its implementation. For example, software license, hardware, implementation consulting and training are highly expensive (Chen J S, 2007 p.73). Companies today expect to increase the productivity by making a ‘lean HR’. The term is often misunderstood as minimizing the number of labors or reducing the HR budget. In fact ‘Lean HR’ indicates the revitalization of HR Power through the implementation of IT. The effectiveness of HR management is not determined by what all things have been done but how accurately it was done. The organizational environment is an important factor in the system application because for the successful implementation of HRIS, sufficiently mature IT environment is essential. In addition to this, companies have to provide training to create systems personnel for the efficient and consistent use of the applied technology. Computer has turned to be the major communication device in organizations since the remarkable growth of internet and web. The system helps managers to interact with the labors, retailers, and customers. However, the introduction of a new system might affect the labor relations in the firm due to the conflict of interests. To illustrate, the disparities of interests in HRIS usually occur at the time of vendor selection and implementation. To deal with such situations, organization should make an assessment about the acceptability attitude of the managers, staff and other employees. Probably, a new technology would force organization to make overall changes in its function. The modification includes the production process, the way they treat the workers, management style, and organization structure etc. No technology can be relied for long standing practice. Hence, company operators should be aware of the latest developments and their pros and corns. Therefore frequent research and developments on production, public relation and marketing have become inevitable which will cause high R&D budget. Therefore, technology has both positive and negative impacts on modern organizations. On the one hand it reduces the labor costs and increases production. It helps HR management to be more accurate and creative by integrating of various departments and information. On the other hand, the ever changing trends in technology imposes heavy financial burden on firms. It discards traditional methods of production, HRM, marketing. Furthermore it forces companies to be innovative in production and marketing. Today companies spend the major portion of their budget on marketing research, product modification and advertising. The Process of Marketing Research Customer acquisition and retention has become difficult for organizations. It happens because of two reasons, competition is at its peak; and customers are highly informed. Hence market research and further planning has great significance in today’s business field. Consumer behavior is a highly important factor in marketing operations. Each purchaser is unique and his needs also might vary from others. The new concept ‘consumer is the king’ has great importance in today’s marketing scenario. Company should have a clear and measurable strategy to assess the results of its functions. Therefore, product awareness and incessant persuasion are essential part of effective marketing. According to Schiffman and Kanuk (2004 pp.125-127), a person who is highly dogmatic, approaches the unfamiliar products with great discomfort and uncertainty whereas dogmatic person is more likely to accept innovative products. In order to identify the consumer segments and trends factual analysis and research is essential. There are certain common steps that marketing researchers can follow. 1. Define a problem The need of conducting a research indicates that a problem has already been identified. It can be an internal or external problem which has been noticed and discussed by any level of management. This is the situation when a research becomes inevitable to fix the problem. Initially, researchers have to determine the purpose of the research, required information, initial and secondary sources, various segments to approach etc. Problem defining is an important part of the research because only if the problem is well defined the research would meet its objectives. While defining the problem, one needs to review the available information like complaints, comments, and requests from the part of customers or workers. In addition to this, other sources like magazines, news articles, service bureaus etc, can also be considered for publicly available information. (Kendrick T., 2004 p.67). 2. Develop an Approach If the problem is well defined, researchers have to develop a clear approach to it. It includes formulating the view how the organization would deal with the issue based on specific theoretical perspectives. In order to defining this approach company has to consider various aspects like company goal, assets, human resource, current trends, etc. Moreover, it can prepare the list of information or data needed for the research. 3. Develop the Research Plan This is one of the crucial steps of research because the subsequent process of the whole research is based on the research plan. It is a process of multiple activities such as preparing Interviews, surveys, and sampling method surveys in order to collect the information required for the research. It actually focuses on the practically effective plan to collect relevant and accurate marketing information. This step defines the significance of the primary and secondary data needed for the research. A secondary data can be the existing result of a previous research which can be analyzed to understand the depth of the problem. The primary data can be collected using different methods like observation, focus group research, survey, experiments; behavioral data research etc. “The research must be technically correct to avoid misleading or inaccurate information that can lead to poor decisions by management.”(Elmore-Yalch R., 1998 p.49) Obviously the primary subjects in the research should be the investors and consumers. They are the individuals who directly involve in the organization’s business activities; moreover the ultimate impact of all changes also directly influences these groups. Therefore, the research should cover the socio-economic interests of the consumers and investors. The future of every business is determined by the prospects or the new clients. Hence an effective study on the prospects can definitely make the research more reasonable. Targeting new prospects and giving follow-up is an important business activity for all organizations. In the same way, functions and strategies of other successful organizations can also be covered in the research. It would give idea about the required strategic changes and advanced method of practice. 4. Data collection If the research plan has been formulated, the next step is the data collection. Although there is no unanimous opinion regarding the data collection methods, the common methods are interviews, questionnaire, psychological tools, customer prototyping, and mechanical devices. Furthermore, the advice and study of financial experts can also be relied on for vital information for the research. Information regarding the opinion of primary and secondary public is most important for a factual marketing research. It would provide initial idea regarding what the customers are highly concerned about; for example, what kind of products and services are currently required; what kind of approach or strategic change would enhance the investors’ confidence etc. Besides the customers’ opinion, information about the public attitude toward the company and its various services also can highly benefit the research. Stability of an organization is determined by the public attitude, and their knowledge about its products/services. Therefore regardless of the common practices, all practical methods can be implemented for the data collection. 5. Data analysis The data collected from various sources have to be classified first in order to apply them in appropriate sections (Classification). The sources of information and collected data have to be categorized according to their reliability and accuracy (source rating). After the classification the similar types of data have to be codified to make the work more coherent (codification). All data collected may not be reliable to reach a conclusion. Therefore data analysis is a significant part of the research. 6. Present the Findings The next step is the presentation of the collected information in a well designed and unified way by the support of the collected evidences. It is the content of the critical information and knowledge derived from the research. The management does not necessarily approve the findings of the research. The report can be accepted fully/partially; or can be rejected by the management if they doubt its credibility. The decision making process follows the submission of research report. It includes the application of proposed activities with the support of the collected research findings. Finally, in order to assess the research applications, feedback of the total program has to be collected. “Marketing managers have the major responsibility of recognizing the relationships among the elements of the system. They must comprehend their potential combinations and coordinate and integrate business factors so that goals are achieved effectively” (Wiley & Sons, p. 5). Marketing Strategies and Objectives Effectiveness of current practices also has to be analyzed at the time of further planning. Factors like marketing strategy, budget, and action program determine the success of marketing objectives. Business operators should ensure that the product or service attain a certain percentage return of the spending on marketing. If it is not proportional, company needs to reset the price to ensure the sales revenue balance with the marketing cost. However ‘pricing objectives, sales promotion objectives, advertising objectives and the like should not be confused with marketing objectives’ (McDonald, 2007, p.280). In order to retain the consumers, marketers have to pay their sincere concern. Consumer acquisition is the initial step of every company’s marketing strategy. Consumers with high optimum stimulation level focus more on the accessibility of product and service in market. For instance, the intermittent network service would easily dissatisfy customers of any mobile phone, internet companies. Hence, up to date service and updated products ought to be the priority of a marketing company while targeting the consumers with high optimum stimulation level. Understanding the consumers according to their traits, approaching them through the proper channel, introducing appropriate cognition strategies and using the advanced technological possibilities are some of the strategies of successful companies. However, in order to determine the consumer category and appropriate strategies, accurate marketing research is essential. Conclusion Organizations’ traditional style and hierarchical structure have been already discarded by the growing technology and changing consumer behavior. Today, an organization with sophisticated, multi functional features can not easily achieve the anticipated goal. It has to accept all macro environmental trends positively; and adhere to the various rules and regulations. However, irrespective of the limitations, information technology has opened a new arena for the effective HR management, outsourcing, and research & development. Employee recruitment, retention and motivation are the significant factors that determine the productivity and growth of companies. Hence, immediate access to information regarding the potential candidates and current human resource capital is essential for the effective functioning of a firm. Modern organizations pay great attention to employee retention and other HR functions. Information Technology has enabled proper organizational HR reporting, confidential data preservation, and sufficient employee distribution etc. However, for the effective implementation of a project, various factors are to be aligned such as management support, proper need analysis, outstanding system design, project assessment/feedback etc. Therefore, entrepreneurs who conduct timely and accurate marketing research foresee the immediate changes and thereby initiate necessary change in their strategies and organizational structure. References Chen J S., 2007, Advances in Hospitality and Leisure Vol.3, Emerald Group Publishing. Elmore-Yalch R., 1998, A Handbook: Integrating Market Research into Transit Management, Issue 37. Transportation Research Board. Gupta V., Kollakota K. & Srinivasan R., 2007, Business Policy and Strategic Management: Concepts and Applications. 2nd edn. Prentice Hall of India Pvt. Ltd. New Delhi. Hoffman A J., Ventresca M J., 2002, Organization, Policy and the Natural Environment: Industrial and Strategic Perspectives. Stanford University Press. Industrial Waste Home, Department of Public Works. Viewed 15 Nov. 2009, Kotler, Armstrong., 2001, Principles of Marketing. 9th edn, Prentice Hall. Kendrick T., 2004, The Project Management Toolkit: 100 Tips and Techniques for Getting the Job Done Right. AMACOM Div American Mgmt Assn. Litwin, Morzy & Vossen (eds.), 1998, Advances in Databases and Information Systems, illustrated, Springer. McDonald, 2007, Marketing Plans: How to Prepare Them, How to Use Them. Illustrated edn.6. Butterworth-Heinemann, Schiffman, Kanuk, 2004, Consumer behavior. Pearson Education Asia Limited and Tsinghua . University Press. Torres-Coronas, Arias-Oliva, 2008, Encyclopedia of Human Resource Information Systems: Challenges in E-HRM, Idea Group Inc (IGI), pp.95, 473. Wiley & Sons, 1971, Marketing Management: A System Perspective. John Wiley & Sons, Read More