The Marketing Process and How and Why Marketing Is Changing in Modern Times - Essay Example

Introduction

Marketing is simply defined as the process that facilitates movement of goods and services to the customer (Armstrong et al., 2013). Broadly, it includes the creation of products, communication to the consumers, delivery of the offerings and exchange of those products and services in the society as a whole. The four core components of marketing include the product, price, promotion, and place. The marketing process of a firm involves identifying the feasible and prospective marketing opportunities in the environment, formulating strategies to effectively exploit the opportunities, modifying the strategies of marketing and monitoring the execution of the marketing endeavors (Palmer, 2012). The marketing process is intended to satisfy consumer needs through creating value in the marketing activities by an organization. This essay will discuss the marketing process and highlight how and why marketing is changing in modern times.

The Marketing Process

The marketing process entails four critical activities or steps. The situation is analyzed so in order to discover opportunities, the formulation of the marketing strategy follows so as to ensure a value proposition is created. Thirdly, the process entails decision making regarding the marketing mix. The implementation of the plan follows then the outcomes of the implemented strategy are supervised. According to Solomon (2009), the first phase of the marketing process is the situation analysis which refers to the critical evaluation of the present state of the business. The strength of the business, the external and internal environment, and the customers are assessed. The assessment is done so as to know the needs of the customer and the capability of the firm. Situation analysis is also done to enable the company to identify areas it needs to improve and the likely challenges it is going to face. The external environment is divided into the micro-environmental factor that affects the specific firm while the macro-environmental factors affect the industry at large.

The situation analysis phase outlines the history of the firm, the current condition, and then uses the information to determine how the future will be. The forecasting is imperative as it will enable the company to avoid instances where it may introduce a product that is not needed in the market. During this step, the problems that the firm is facing is identifies while the opportunities are also spotted. In this regard, the company is able to know where it may need to improve in order to offer products or services that will better meet the consumer-needs. Solomon (2009) added that the potential of the company can be matched by either producing superior goods or upping the standards to be at par to the firm’s capabilities.

The company is analyzed on its culture, technology, objectives and public relation. The customers’ characteristics that are analyzed in terms of the market segment, market size, trends and the frequency of purchases made. The market has buyers who vary from the impulse to frugal buyers, and their characteristics should be examined to know the type of products to offer them. Additionally, the competitors are evaluated on the products they are offering, their market shares, their positioning and their strength and weaknesses. The environmental situations are assessed in four primary aspects; political, socio-cultural, economic and technological factors (Palmer, 2012).

The information in the situation analysis is obtained from reports from the market research, country reports, and customer feedbacks. The methods used to conduct situation analysis engross the 5C Analysis, Porter five forces analysis, and the SWOT analysis. The 5c Analysis is used to look at the macro and micro-environmental factors that have an impact on the firm (Burnett, 2008). The customer, the company, competitors, collaborators, and climate, are analyzed using the 5C Analysis tool. The SWOT analysis is carried out for a product or company to see how it can perform better, outdo competitors, avoid failure, and stay relevant in the market. Palmer (2012) illustrated that the Porters five forces analysis tool analyzes the degree of competition in the market and the development of the business strategy. The five forces encompass the threat of new entrants and the threat of substitute products. The bargaining powers of both customers and suppliers are the other forces that affect an organization. Finally, the Porters five forces analysis tool is used to determine the intensity of the competitive rivalry.

The formulation of the marketing strategy is the second step in the marketing process. After the opportunity is identified in the first step of the marketing process, the strategic plan is developed to pursue the opportunity. The marketing reports from studies carried out on marketing provide the information used to determine the target market that the company will offer the product or service. Market segmentation, selecting the target market and proposing the value that customers will gain by purchasing the product or service offered are the main activities of the market strategy (Armstrong et al., 2013).

Market segmentation involves identifying the sections of the markets that have customers with similar needs and classifying the market into the segments. Segmentation is important because it acknowledges the diverse needs, taste and preferences of the different customers in a market. For example, a company that sells clothes will need to segment the market by age so as to provide trendy and fitting clothes to young customers and offer classic clothes to the old customers. An ideal market segment is that which is large enough, measurable and accessible. Examples of the bases for market segmentation include age, income, and region and population density (Burnett, 2008).

After segmentation, the firm now focuses on the segment selected by offering its product or service. There are several targeting strategies. A firm can opt to use the undifferentiated targeting marketing strategy where it takes products to the whole market without considering the differing preferences (Armstrong et al., 2013). It may use the differentiation strategy to choose the market segment by offering products that suit a specific section of the market with customers. A successful company will analyze the customers, characteristic, needs, tastes, and preferences. After the target market has been chosen, positioning is made. Positioning refers to the perception of the product in customers mind, and so it is imperative for the company to design a product that is unique. Product positioning enables the company to select the best competitive advantage in order to outdo its rivals offering the same products in the market.

Developing the Marketing Mix

This is a critical element of the marketing process as it harbors the 4Ps- product, price, place and promotion. Every organization should develop the most suitable marketing mix for its offerings. An effective marketing mix blends the 4Ps in a way that steers the company to achieve its objectives (Palmer, 2012). The product refers to what the firm is selling and matters as pertains the product such as its quality, packaging and branding are addressed.

The pricing strategy of a company is important as it is what the customers pay for as the charges. Solomon (2009) echoed that the costs of production, desired profits and the type of market within which the company is operating in are some of the factors considered when selecting a pricing strategy. An ideal pricing strategy is that which considers the financial strength of the customers while at the same time giving a reasonable return to the company on the investments made. Pricing strategies include skimming, value-addition and penetration strategies.

In addition, the marketing mix has the promotion element that includes personal selling, advertising, PR and sales promotion. The promotional activities are intended to inform, persuade and remind the customers on the offerings of the company. Finally, how the product will reach the customer is also a key component of the marketing mix. Distribution, which explains how the product will be delivered to the end-user, involves the physical movements of the offerings (Palmer, 2012). The delivery is made through various channels such as through the wholesalers, retailers or in some instance, direct to the customer.

Implementation and monitoring of the marketing efforts made constitute the final step in the marketing process (Burnett, 2008). Any market changes should be detected and products modified in line with the changes. For example, changes of taste and preferences should make the company modify or improve their products in the market. If the changes required are fundamental, the firm may need to introduce an entirely new product into the market.

How and why Marketing is changing in Modern Times

Marketing is experiencing changes on a daily basis due to the changing demands, tastes and preferences of the customers. The changing marketing environment will, therefore, require the marketing manager to find the necessary ways to adapt the organization to suit or conform to the dynamic ever-changing environment. All industries are changing, but the marketing environment that experiences the most rapid changes is the technology industry such as firms dealing with computers and electronics (Rahnama and Beiki, 2013). The changes in the marketing environment have led to a new concept, often referred to as the modern marketing. Modern marketing evolved from the production era where consumers used to prefer readily available and cheap products. The product era that followed was characterized by the fact that the consumers prefer innovative products that have quality.

The marketing environment also changed in the selling era. Here, the era held that businesses and customers will not purchase offerings of a company in quantities it wants, if the company leaves them alone. Hence, the selling era mandates the firm to carry out intensive product promotion activities to persuade customers to buy the products. The other era is the marketing era that holds that a firm must better its rivals in the market in terms of product deliver, design, communication, targeting and market positioning (Webster, 2005). Traditional marketing mainly concentrated on the seller and his needs but left the buyers. The modern market, on the contrary, focuses on the buyers needs by focusing on improving product quality, target marketing, and integrated marketing.

Target marketing, an ingredient of the marketing process has also changed where companies are carefully choosing their targets and preparing customized programs (Rahnama and Beiki, 2013). An example of such a company is the Coca-Cola Company that manufactures the diet coke targeting those people who are observing nutrition due to diabetes or those avoiding cholesterol. The modern marketing is also changing when looking at how the customers’ needs are catered for. Firms are now acknowledging the various types of needs such as the real needs, secret needs, unstated needs, delighted needs and stated needs. Companies are now trying to satisfy all those needs instead of satisfying the stated needs only, as conventional marketing did.

The modern marketing is also changing with the introduction of the social marketing. Companies are now not only aiming to satisfy customers but also the society at large (Webster, 2005). As such, the corporate social responsibility (CSR) is a component that firms are now integrating into their marketing. The society expects marketing functions of a firm to tackle social concerns such as environmental conservation. In the marketing mix, for example, companies are designing packaging materials that are recyclable so as to conserve the environment. Companies distributing goods are also observing the environmental laws by being responsible in their distribution and disposal of damaged goods so as to avoid conflicts with the society (Webster, 2005).

The modern marketing is also changing with the emergence of global markets. Globalization, is now a contemporary trend in the marketing world, with many companies going global. For instance, leading companies that have gone global include McDonald’s, Starbucks, SAB, and the Coca-Cola Company, all found in many countries in the world. Still, on the issue of globalization, the international markets are having different features regarding tastes, preferences and needs. As such companies are embracing glocalization, where they design products that suit the local people while at the same time integrating the global concepts and strategies. For example, McDonald’s offers non-meat products in India bearing in mind that most people in the country are Muslims and Hindu hence do not consume pork and beef. Promotional activities are now tailored to offer the best delivery services to the target market (Kotler and Armstrong, 2010).

International marketing is also on the rise because the global markets are not yet saturated as compared to the domestic markets. For instance, the English textile and jewelry market is still unexploited by MNCs, although the domestic sellers are many. Domestic corporations that incorporate global ideas in their products flourish in such markets. Global markets are also on the rise due to the fact that they lengthen the products life. A new product that sells domestically could reach stagnation or even death in a short period of time. Kotler and Armstrong (2010) reiterated that companies that want to continue earning returns from investments made when developing products are now entering the global markets. A firm’s sales revenue is greatly improved with globalization and glocalization. A majority of globally oriented organizations get almost over a third of their sales revenue from the sales made internationally. Such companies include Gillette, Procter & Gamble, and And Johnson & Johnson companies.

Rahnama and Beiki (2013) stated that the other reason why modern marketing is changing is the emergence of e-commerce as a trending feature in marketing. The telecommunication sector is rapidly changing, and the evolution of the internet is also exponential. Customers now have information at the touch of a button, anywhere at any time. E-commerce uses the ICT frameworks to avail goods and services to the consumers. One of the component of marketing that uses the internet is the promotion element. For example, advertising, a traditional promotional method, is used by companies in various platforms. From social networks such as Twitter, Facebook, Google+ are all used to advertise goods and services especially those targeting the young people. This is attributed to the notion that many internet users are young, educated, and are high-income earners.

People now prefer to make online purchases due to their home-based lifestyle. This is the reason why online companies such as the Amazon.com are doing great businesswise with its customers doing online shopping. Online shopping is also common due to its flexibility, and it also offers the customer an opportunity to compare goods conveniently (Kotler and Armstrong, 2010). It saves time for the customers instead of physically visiting multiple shops, an endeavor that can be time-consuming even businesses can deliver goods to consumers with ease when buyers make precise orders from an informed perspective.

Technology is the root cause of the changes in modern marketing. For instance, Oracle unveiled the marketing 5.0 in 2014, the marketing era that rich customer data and cloud-technology facilitate brands so as to satisfy the needs of the contemporary customers. Marketing 1.0 was marketing through literature tools such as newspapers while marketing 2.0 used radio and TVs (mass communication). 3.0 and 4.0 involved the internet while the latest 5.0 will blend all the five eras to create a meaningful Omni-channel experience to customers based on their personal needs.

Formulation of the marketing strategies is also changing where firms are strategizing focusing more on the Internet-connected customers. Marketers are using the internet to communicate what they are offering by knowing where to place their adverts and to whom the advert targets (Rahnama and Beiki, 2013). When the marketers formulate budgets, they now consider all the channels options instead of using one channel. Moreover, another notable change in marketing is the push marketing that has been replaced by the push marketing. Branding is now a tool that is used to educate and inform the consumers and any product that is currently new on the market. Brands that educate users are easily recalled and corporations such as Evernote LTD have excelled due to their brands that educate.

Companies now focus on the Know your customer (KYC) tactic in the quest to retain their customers and effect customer loyalty. The marketers only convey messages to customers who need it, in a strategy known as permission-based marketing, as customers have differing tastes and needs. Marketers are also making decisions based on data collected through marketing research, other than making decisions based on assumptions and perceptions (Webster, 2005). Also consumers want advertisements that add value, are timely and relevant. Hence, marketers are now more inclined to communicating adverts that remain in the mind of the end-user, by ensuring the adverts add value or else customers will forget the message easily (goldfish effect).

Conclusion

The marketing process is an important process that ensures the offerings of a firm reach the end-user. The process involves situation analysis, developing a marketing strategy, marketing mix and implementation and monitoring of the marketing efforts. Modern marketing, mainly facilitated by the internet is rapidly changing. The changes are due to the nature of the changing needs, tastes, and preferences of the customers. Businesses no longer focus solely on profit-making, other they are now focusing on meeting the needs of their clients. As such, modern marketing now considers personalization rather than globalization where marketing activities are tailored to suit the end-users. The evolution of ICT and the emergence of social media networks have also contributed to the changes in marketing.