Leading the Way Start with a Marketing Audit - Coursework Example

Marketing Audit The Marketing Audit "A marketing audit is a systematic, comprehensive examination of a firms marketing organization, strategies, objectives, tactics, and activities. A marketing audit allows top management to discover the firms strengths and weaknesses in relation to threats and opportunities it faces in the marketplace, and identify more effective uses for the accessible marketing resources" (Wilson, 2005). The goal for this marketing audit is to outline the assessment of the current environment, customers, target market, competition, services, and marketing strategies to be utilized in developing a marketing audit plan for the firm. The approach, resources, and stages of undertaking marketing audit will also be explained. "The marketing audit will be utilized as a fundamental section of the marketing planning process. Marketing audit can not only be carried out at the initial stage of the audit process, but also at a sequence of points throughout the implementation of the plan. This audit will consider both external and internal influences on marketing planning, as well as reviewing of the plan itself” (Crompton & Lamb, 2011). The marketing audit plan will be utilized to make the sales 0bjectives outlined in the firm business plan a reality in the year 2013. The marketing audit has specific similarities to a financial audit in that it is a review the firms existing marketing activities. Carrying out the marketing audit offers the opportunity to review and appraise the firms whole marketing activity, allowing the firm to evaluate present and the past performance as well as to offer the basis for assessing probable future course of action. Since the firms environment is ever changing, the marketing audit needs to be utilized as a reference tool, with consistent updates corresponding to changes in the external environment and your own internal operational experiences (Crompton & Lamb, 2011). 1. The Internal Marketing Environment Marketing Mix The marketing mix is one of the main most famous internal marketing environment terms. The marketing mix is the operational and tactical part of a marketing plan. The marketing mix is also called the 7Ps. The 4Ps are place, product, price, and promotion. The marketing mix on services is also termed as the 7Ps which includes the addition of people, physical evidence and process (Webster, 1992). Product Product is defined as the combination of goods and services the firm offers to the target market. A product is simply the physical, tangible item that individuals buy or sell. A product can also be the product as intangible in terms of a service (Webster, 1992). Price According to Webster, (1992) Price is the amount the customers must exchange to receive the product or service. The firm’s goal in terms of price is actually to reduce costs through enhancing efficiency in manufacturing, and most significantly the marketer requirement to increase the perceived value of the benefits of its services and products to the customer. Place Place includes firm activities that make the product accessible to target consumers. Place is as well known as distribution channel, or intermediary. It is the machinery through which goods and services are transferred from the manufacturer or service provider to the consumer (Kotler and Armstrong, 2010). Promotion According to Kotler and Armstrong, (2010).Promotion comprise of all of the activities marketers carry out to inform customers about their products and services to encourage customers to buy these products and services. Promotion comprises 0f all the tools assessable to the marketer for marketing communication. Whilst there is no absolute agreement on the particular content of a marketing communications mix, there are several promotions components that are often comprised of aspects such as advertising, sales, sales promotion, direct marketing, public relations, personal selling and online communications. People People are all human attributes which play a role in service delivery and therefore influence the buyers perceptions; termed as the customers, firms personnel, and other consumers in the service environment. People are the most significant component of any experience or service. Services are produced and consumed at the same time (Zeithaml et al, 2008). Process Process is the actual mechanisms, procedures, and flow of tasks by which the service is delivered; this is an operating system for service delivery (Changchien & Lin, 2005). There are several perceptions of the process concept within the firm and marketing literature. Some individuals see processes as a mode to achieve an outcome. However in real life it is more about the consumer interface between the firm and consumer and how they deal with each other in a sequence of steps in stages throughout the process. Physical Evidence Physical evidence is the environment where the service is delivered, and where the company and customer interact, and any tangible element that facilitates communication or performance of the service (Changchien & Lin, 2005). Physical Evidence is the material component of a service. Honestly there are no physical attributes attached to a service, thus a consumer tends to depend on material cues. There are several examples of physical evidence, comprising of the following buildings, signs, equipment and logos, business reports and annual accounts, your website, brochures and the firm business cards. 2. The External Marketing Environment When doing a marketing audit, make sure to analyze the external factors that influence the operations and the overall running of your business either in its present location or in any other positions where your franchises are located. You can look at the external marketing environment at three broad levels; the economic environment, the competitive environment and one of your own marketing environments. Do any changes from these external factors have impacts on your business? All these factors should be included in your audit if at all they have a chance of affecting your competition (Rothe, Harvey, & Jackson, 1997). 1. The Economic Environment a. Political Businesses and organizations could introduce a risk factor that is determined by the politics of a country making them to suffer some loss. The actions and policies of a government could change anytime and businesses therefore need to be prepared for these eventualities. The government could change its regulations and this could affect a business in terms of taxes. Managing political risk is therefore important and one should consider buying political risk insurance. Organizations that have international bases use this type of insurance to alleviate their risk coverage that result from political instability. There are indices revealing the risk exposure that an organization can face in specific countries. b. Economic Economic environment is multifaceted and it continues to change according to policy changes, and the prevailing political situations. This affects the types and capacity of employment that in turn reflects the general economic growth and inflation rates and general Income levels (Clark, 1999). It has mainly five main components:- 1. Economic Conditions - any change in the standard of living, trends of supply and demand, purchasing power of public, distribution of income etc. greatly influences the size of the market. 2. Economic System – the framework of rules incentives that define the economic relations. An economic system of a country could be; capitalism, socialism, democratic socialism, totalitarian socialism or a mixed economy. 3. Economic Policies – the Government may give subsidies to one sector of businesses as opposed to others and this may not have favorable conditions for some businesses. It may decrease the rates of excise or custom duty or tax rates. 4. International Economic Environment - The functions of economic environment in international businesses is increasing. If any organization is involved in foreign trade, then it is determined of affected not only by the economy of its own country but by that of the country in which it is operational, whether exporting or importing goods (Capella & Sekely, 1978). 5. Economic Legislations - Governments come up with and design legislations which Regulates and control the businesses that are operational as well as new establishments (Changchien & Lin, 2005). C. Social and Cultural Includes the demographics (population growth/distribution, age), cultural and lifestyles values (changing beliefs, skills, family values). Human resources - patterns of employment and working conditions in the society largely determines business organization. The flexibility in employment patterns and approaches of people to careers direct organizational operations. All company’s should plan for changes is the social environment (Wilson & Gilligan, 2012). Marketing - the demand of a product in the society informs on the product distribution and consumption patterns of a firm. Doing market research helps a company in knowing its demands and purchasing power of their customers (Wilson & Gilligan, 2012). Production – determining the size and impact of production in the global economy is vital in market planning. A business should ensure that their production is positive and meets the desired requirements (Wilson & Gilligan, 2012). c. Technological - IT, internet, home shopping With the advent of internet and diverse social media and applications, technology is changing at a rapid rate and any company should consider this in its marketing audit as a very important factor (Changchien & Lin, 2005). d. Environmental – All businesses are now “going green”. A market audit should consider innovative ways of conservation of nature and promotion of environmentally friendly products (Changchien & Lin, 2005). 2. Competitive Environment Your competitive environment is very important for your business. Consider factors such as; new entrants in a similar industry like yours, the bargaining power of consumers, substituted products, distribution patterns and your marketing strategies. Your marketing audit should use this data to inform your plans. Focus on any strengths and weakness both internally and from your external competition (Jobber, 1995). 3. The Market Environment When establishing and creating franchises for your business, you have to know the actual market size, and the growth and trends of products and prices prevailing in the market. Check the industry practices and create your own feasibility to an existing environment (Cram, 1995). References Koetler, P. & Armstrong, G. (2010). Principles of Marketing. New York, NY: Prentice Hall Rothe, J. T., Harvey, M. G., & Jackson, C. E. (1997). The marketing audit: five decades later. Journal of Marketing Theory and practice, 1-16. Cram, L. (1995). The Marketing Audit: Baseline for Action. Library trends, 43(3), 326-48. Clark, B. H. (1999). Marketing performance measures: History and interrelationships. Journal of Marketing Management, 15(8), 711-732. Wilson, A. (2005). Marketing Audit Handbook. Kogan Page. Capella, L. M., & Sekely, W. S. (1978). The marketing audit: methods, problems and perspectives. Akron Business and Economic Review, 9(3), 37-41. Jobber, D. (1995). Principles and practice of marketing (pp. 599-602). Berkshire: McGraw-Hill. Webster, C. (1992). What kind of marketing culture exists in your service firm? An audit. Journal of Services Marketing, 6(2), 54-67. McDonald, M., & Wilson, H. (2011). Marketing plans: How to prepare them, how to use them. Wiley. Wilson, R. M., & Gilligan, C. (2012). Strategic marketing management. Routledge. Crompton, J. L., & Lamb, C. W. (2011). The Marketing Audit-A Starting Point for Strategic Planning. Journal of Park and Recreation Administration, 4(1). Changchien, S., & Lin, M. C. (2005). Design and implementation of a case-based reasoning system for marketing plans. Expert systems with applications, 28(1), 43-53. Read More