The Contemporary Issues in Marketing - Essay Example

?Contemporary Issues in Marketing Table of content. ……………………………………………………………………….2 Introduction……………………………………………………………………..2 The concept of marketing and its components………………………………….3 Definition………………………………………………………………3 Identifying the market segment…………………………………………4 Target group (TG)……………………………………………………….4 Positioning of the market………………………………………………..4 Integrated Marketing Communication………………………………….5 Measurement of the advertising affects………………………………..6 Measuring customer satisfaction………………………………………..7 The gaps in customer expectations and experience……………………..7 Understanding the gaps within the services ( 5 Gaps)…………8 Branding strategy……………………………………………………….10 The Importance of the marketing research……………………………..11 The boon of the technology in the marketing…………………………………….12 New age marketing mix………………………………………………….14 Ethical issues in the marketing…………………………………………………..16 OQL theory………………………………………………………………………20 Conclusion………………………………………………………………………..20 References………………………………………………………………………..21 Abstract: One of the most fundamental roles of marketing within an enterprise is to ensure that the processes adopted by a firm succeeds in creating value to their customers, by meeting their needs. Thus the term is not only restricted to selling of the products, but also extends to ensure that the customer receives some kind of benefit out of it (Silk, 2006). This fact can be documented with various examples in the recent times, which substantiate and reaffirm the extended role of marketing in contemporary times. The scope of marketing as an integral corporate activity has now completely transformed to include relationship based marketing as well. This paper will be focusing on all the aspects as well as issues related to contemporary marketing. Furthermore, other critical issues such as the traditional and modern marketing approaches as well as the involvement of the technologies; the ethical aspects of the Marketing are also discussed comprehensively, in this paper. This paper will help the reader to understand the contemporary definition and the approaches of marketing in the modern era. Introduction: There are thousands of books for marketing in the recent time, but do all of these books say the same thing in a different manner? Or these books are not at all applicable in the real life? Well, this paper reveals the major contemporary issues of these marketing books in a descriptive manner. The great virtue of marketing management is, that it is bound to change and evolve over time, developing newer strategies and theories which may benefit the marketing of products, and ultimately help in improving human lives in the process. Such improvements and evolution of marketing concepts and theories; play a key role in enhancing the quality of our lives by making more and more products and services accessible to us. However, marketing is a huge functional entity which comprise of various branches. The contemporary issues of marketing include the manner in which products and services are marketed, in an ethical manner and the use of technology as a new-age marketing strategy. This paper will discuss all the contemporary issues which are important to improve the product. The concept of marketing and its components: Definition: Marketing is an age-old phenomenon and it comprises of various critical aspects which can be applied in various situations. The definitions of marketing have expanded and developed over the years and has been defined differently by different authors depending upon the various factors. However, according to Philip Kotler the term marketing refers to a human activity which involves exchange of goods and services, whereby the sellers pursuade the buyers to buy the product in order to satisfy their needs and wants (Kuzbard & Soldow, 2001).. According to the American Marketing Association (AMA) the term marketing is defined as “Marketing is an organizational function and a set of processes for creating, communicating, and delivering value to customers and for managing customer relationship in ways that benefit the organization and its stakeholders”… (Parsons, and Maclaran, 2009). It comprises of a range of pre-sales activities which helps in boosting the sales of a product and ensures its acceptability by the target customers or market segment. It is a phenomenal function which gives identity to a product. The term ‘Product’ refers to both tangible as well as intangible physical entities which cater to the needs and wants of the consumers. According to Cooke et al (1992): “The macro-marketing process is a need-fulfilling exchange activity that is present in virtually all cultures…This process must occur so that the consumption of values can occur…Exchange is a means of increasing the total satisfaction of a society…” Marketing helps in increasing the saleability of a product. This particular paper focuses on the 360 degree marketing activities. The concept of marketing has changed considerably in the recent times. Today, it can be viewed as a common human action similar to loving, consuming, attracting and many more (Kotler, 1972). The concept of marketing has become extremely common and is integrated within our day to day activities. There are some very important factors which are involved in the field of contemporary marketing management which are discussed below. Identifying the market segment: Identification of the market is very vital for any company.. Market segmentations help the firms in identifying their potential consumers and aim their product promotion strategies towards this select group of consumers. Markets are generally divided into various prospective segments. However, identifying the proper segment is really challenging as it is very difficult to identify proper marketing mix i.e. product, price, place promotion for each segment (McDonald and Dunbar, 2004). However, with respect to the marketing scenario the term market segment can be defined as the “process of dividing the market into relatively similar, meaningful and identifiable segments of groups” (Lamb, Hair Jr and McDaniel, 2008). Target group (TG): Identifying the target group is another significant aspect of marketing. Identification of target group or appropriate market segments is crucial for any firm, since it helps in saving the expenditure which would otherwise have been incurred in producing two or more products. Proper identification of the target group would lower down the cost of manufacturing (of the additional and /or unnecessary product) and thus lower the cost of production in the process. Consumer behavior is a functional activity which is associated with the purchasing of products; seeking out for the new products; and assessing products and product related services which satisfy the needs and wants of the consumers (Schwarz and Hunter. 2008). Positioning of the market: Positioning of the company in the market is very much important. Each and every company should know where to position themselves within the market. Integrated Marketing Communication: It is very rare to observe a buyers to buy a product which they have never heard of. Thus marketing of a product and communicating its importance and relevance to the consumers is of extreme significance. The advertisements are a form of marketing strategy used by the marketers / firms, which act as a psychological catalysts which help the products to be treated as a brand in the minds of the customers. The integrated marketing communications are the primary factor for the products to be recognized as a brand in the competitive market. The advertisements serve as an important means of communication and provide the much needed psychological boost. It is all about how the brand reaches to its target group (herein after referred to as TG). After defining the target group it is very much important to reach the TG in a systematic manner. There are various toy brands are available in the market but it is extremely crucial for the firms/ marketers to make their brand recognizable / identifiable by the target consumers, among the other various toy brands, which are available in the market. recognized among the other brands? Advertisements serve as an essential tool in achieving this goal of the marketers. There are several ways of advertising. However, the traditional forms of advertisings are outdated. The advertising planners on the marketing department focus on a three way form of advertising. This includes: BTL (below the line advertisements), ATL (above the line advertisements) and TTL (through the line advertisements). In order to successfully advertise their products, the marketers must choose the most effective forms of advertising among these (Tymorek, 2010). Appropriate selection of an advertising strategy would help the firms in restricting their advertising budget and at the same time achieve their target group effectively. The ABL form of advertising is essentially used for products which are for used for mass consumption and in cases where the associated advertising budget is significantly higher. BTL, on the other hand is strictly used for Niche products.. The TTL is a combination of the ABL and BTL. These advertising strategies are strictly closely related with the target group. Measurement of the advertising affects: Creative advertisements act as a magic spell for the products and help them in being successful in the market.. However, despite estimating the exact outcome of such a form of advertisement, with regard to monetary terms is a relatively tricky issue. There are certain ethics or rules which are required to be followed by firms with regard to advertising of their products and / or services. Various agencies are set up at the national level in various countries, and the firms are required to observe the guidelines laid down by them; for instance, the American Association of Advertising Agencies (AAAA) in United States and the European Association of Communication Agencies (EACA) in Europe. (Tymorek, 2010). The two key factors which play a major role in advertising include: recognition and recall value (Plessis, 2005). The measurements of success of an advertisement is strictly hypothetical in nature. The effects of advertisements can be a short term or long term. Some advertising techniques have certain unique hidden consequences which can result in lingering effects among the consumers. Although the exact monetary benefit of advertisements cannot be calculated with precision, it can however be measured in terms of the sales figure post the launch of advertising campaigns. However, it it must be taken into consideration that the effects of an advertising campaign cannot be experienced right away, since it takes time to translate into monetary benefits. Thus, given the complex nature of calculating the impact of advertising, the sales figure is probably the most accurate measure of the same. Measuring customer satisfaction: Most of the organizations analyze the customer feedback data and use other tools to measure customer satisfaction. However, the opinion of customers regarding the same product might differ significantly, as people have different tastes and preferences (Cochran, 2003). Hence, the firms must make an effort to collect all relevant information regarding their customers, in order to understand their background, life styles, tastes and preferences etc. This would further help them in appropriately categorizing their target customers and offer them producs which they desire, and hence increase customer satisfaction in the process. The gaps in customer expectations and experience: In terms of marketing, the customer is the king. Hence their preferences and opinions regarding a product / service hold supreme significance. The marketers must ensure that all the customers’ requirements are duly fulfilled while delivering a product / service, since it is directly related to customer satisfaction. However, more often than not, some of the minute requirements / expectations of the customers are ignored by the firms (Hill and Allen, 2007). This leads to a significant gap between the customer’s expectations and the product delivered to them. For any new products, the concept is generated within the organization. But, the performance is calculated by the acceptances of the customers. The size of the gap between the product characteristics and the customer satisfaction is the main factor, which plays a key role in influencing buyer behaviour. The focus should be given on the large gaps rather than the small gaps in most of the organizations. These gaps can create a huge negative effect on the brand. According to a study the gaps are calculated by a ten point scale. Any gap which is more than one point is a concern and the gap above two points should be taken seriously. The business impacts of these gaps could be devastating. Intially, these gaps might not be so prominent but in the long run they may create a big problem. There are instances where firms were made to retract their products from the market by taking them off the shelves. If the customers are not satisfied with the product offered to them, then it could be highly disastrous for the brand and on the other hand if the customers are satisfied they only fetch more customers for the company. Understanding the gaps within the services: 5 Gap Model: The five gap model is an important tool to for finding the gaps within an organization which might affect their service quality. The needs, requirements and the perception of the customers must be understood properly to bridge these 5 gaps in order to ensure best quality services to the customers which meet their expectations. According to Kotler (2008) the relevant five Gaps are discussed below. Gap 1: Management perception versus consumer expectations: The management often fail to understand the requirement of their consumers. This leads to a gap between the product delivered to the consumers and consumer expectation. Such a gap is one of the most common gaps found across various organizations. Thus, this gap acts as an indicator for the organization, suggesting them to deliver high quality products, which are in accordance with the consumers’ expectations (Kotler, 2008). Gap 2: Service quality specification versus management perception: This particular gap may occur due to various reasons. Most of the time it occurs due to lack of adequate supportive service quality on the part of the management. Thus although the managers are fully aware of the consumer’s expectations and preferences, they are unable to offer such a product, merely due to lack of required support structure (Kotler, 2008). Gap 3: service quality specification versus service delivery: This gap is basically concerned with the service-performance gap. This gap occurs when the manager of a shop is aware of the steps to be taken to provide a product in accordance with the customer’s expectations, but the employees are unable to understand or sometimes unwilling to work accordingly (Kotler, 2008). This is basically a communication gap within the organization. To bridge this gap the proper standards must be developed and implemented within the organizations for the employees to follow. This would ensure proper communication of instructions to the employees and ultimately result in customer’s expectations being met. Gap 4: Service delivery versus external communication: This is a gap which creates lot of confusion among the customers. This is a gap between extensive commitment towards service and the actual service being delivered. In this gap the organizations commit to deliver more but it fails to deliver or fulfill such a commitment. One of the key reasons for such a gap is the extensive promotional campaigns, which tend to increase the expectations of the consumers, however the company fails to deliver accordingly (Kotler, 2008). The extensive advertising campaigns undertaken by organizations lead to creation of a false impression in the minds of the consumers. Such a move can prove to be fatal for the health and reputation of the brand in general and the company overall. Gap 5: Expected service versus perceived service: This is a gap which is basically combination of all the other four gaps, discussed above. If the gaps of other four factors increase then this gap will automatically increase. The expected quality is the combination of all the services delivered according to the commitments made (Kotler, 2008). This five gap model is very important to analyze the existing Gaps within a particular organization and to acts as an indicator which helps in bridging these gaps and ultimately help in providing products which meet the customer’s expectations, thus increasing their satisfaction in the process. Branding strategy: Evaluation of the brand equity: Brand equity is the actual strength of the brand within a specific market. For instance, brand equity can be stated as the strong mental association of the consumers with a specific brand. It also can be described as the aggregate value of the brand in the customers’ mind (Majumdar, 2009). Customers are the assets of of an firms and the concepts such as brand identity and brand equity closely related to customer equity. The brand audit is basically the valuation of the brand in a quantitative manner. Brand audit is a very important tool which is used for building brand identity (Roll, 2006). The brand audit is an important factor for the improvement of the brand. It helps a company to understand the health of the brand and it also identifies the additional values required to improve the brand equity. Brand is an intangible asset of the company. It could be represented in the form of a name, logo or a trademark associated with the product which distinguishes the product from the other identical products. (Clifton, Simmons, and Ahmad, 2009). Branding is an essential part in the process of selling. It should be done in such a manner that a it helps the customers in identifying and differentiating the product from the other products available in the market. There are various branding strategies available at the disposal of the marketers, these include Brand Extension, Co-branding, multiple branding strategy, single brand strategy etc. Co-Branding: Co-branding is a form of branding where two or more brands come together to retain their identity in the competitive market. In this case all the brands are given focus and these campaigns are among the medium to long term strategies. (Begemann, 2008) For an example McDonalds give away Disney toys with the happy meals. Multiple branding: Multiple branding is very much important for a market like toy market. The multiple branding has become one of the main branding strategies as the risk of single branding failure is low (Bowie, and Buttle, 2004). The Mimic brand: The mimic brand is a brand which resembles the logo, tag line or brand name of the other brand intentionally to capture the target market. These mimic brands sometimes imitate the packaging of the original brand (Keller, 2008). Brand Extension: In the recent time the brand extension has also got assumed immense significance in the field of marketing and branding. Brand extension is introduced in the market only if the original /parent brand is successful. It is basically extending the brand with different products. The Importance of the marketing research: The marketing research is a specific marketing function which helps the management in taking effective marketing decisions (Wrenn, Stevens and Loudon, 2006). According to the American Marketing Association the marketing is defined as “the function which links the consumers, customer, and public to the marketer through information” (Wrenn, Stevens and Loudon, 2006). Marketing research involves huge amount of data which is collected by firms for various reasons. Such data helps the firms in taking key strategic decisions. However, the best marketing research does not necessarily translate into the best marketing decisions. One of the main roles of the marketing research is to simplify the decision making process in an efficient way. However, the concept of marketing research plays two major roles in the whole marketing system, and they are; 1. They are the part of the marketing intelligence feedback function, and 2. It provides the ultimate quantitative data to the decision makers to enable them to take long-term decisions. The segmentation research and the new product research are the most lucrative fields in the marketing which can be exploited by the marketing managers in their favour (McDaniel and Gates, 1998). The boon of the technology in the marketing Internet has become an important part in our daily life. Whether we are in office, home or in a tour internet follows us everywhere. E-marketing is something which provides us the opportunity to save our time and money while we shop in a comfort. There are various websites which provide us many facilities at free of cost. Is it possible to imagine a service free of cost in a real life? The answer would be no for sure! But, in the digital marketing space we receive various services free of cost. However, some websites do charge us for their services albeit at a very low cost. The reach of internet has expanded manifold, in recent times, especially with the advent and popularity of social networking sites such as Facebook, Twitter, Myspace and the likes. Internet and technology has drastically brought about a revolution in our life styles and the manner in which we consume products. The introduction of bespoke websites offering products made to order, in accordance with the customer’s expectations have increased and the marketers are now increasingly banking on the use of social networking sites for advertising their products. Thus, needless to add, that the advent of technology has changed the rules of marketing, altogether. However, it must be noted that although a wide amount of information is now freely available on the internet, the validity and credibility of such information is highly doubtful (Hislop, 2000). Ethical issues in marketing: This is an age old question that “is really marketing an ethical way to promote the products?” Is there any ethical value attached with the process of marketing? Ethics dictate the manner in which things should be executed, i.e. the morally right approach which is beneficial for both individuals as well as for the society as a whole. Business is an important part in the human civilization and also it is a very important factor in the society. The structure of business is highly complex in nature. It involves a two way communication i.e. between the organization and the people involved. Thus any activity that the organization indulges in directly affects the public. Hence the issue of morality must be taken into account. The lack of morality or ethics in business threatens to disrupt the very foundation of society which is based on mutual trust and well-being. Business ethics thus are and should be an integral part of all organizations. There are many theories of ethics have been practiced in the different business organizations. This particular study is all about finding the strength and weakness of the different theories of business ethics. Virtue Ethics: The proper practice of business ethics helps the organization to set a common standard to understand what is right and what is wrong. Without business ethics the business men would set their own rules and moral principle which might be good for one but bad for many (Roa 2007). The virtue ethics is the basic theory of ethics where four noble virtues are identified and practiced and the four strong virtues are integrity, honesty, self respect and responsibility. These virtues are identified and explained by Aristotle and he has given the explanation about the Golden mean of virtue in his theory. (Teets 1976). The virtue is basically the behavior that shows high moral standard. Aristotle believed that each and every action of a human being is directed towards and aim. (Bowie and Bowie 2004). Utilitarianism: Utilitarianism is the concept that the morality is determined solely by its utility in providing pleasure and happiness. It means that a moral worth of an action can be determined by its outcome. The utilitarianism was described by Bentham as the greatest happiness or greatest felicity principle. There are many types of utilitarianism being practiced and they are preferences, rule, act, two level, total, average, negative, hedonism, enlightened self- interest etc. Deontology: The word deontology is been derived from the Greek words for duty (deon) and science of (logos). In the contemporary moral theories the deontology is the theory where the choice are normally required, forbidden, or permitted (Deontological ethics). The deontological theories can be described by their opposition to consequentialism on fundamental points. It signifies that what is morally right or wrong to do depend on what would bring about the best result. Comparison between the theories: It is very true that all three theories have philosophical approach which might not be easy to measure in a practical manner. Each one of these theories has different psychological approach towards the ethics. Virtue ethics is a theory which relies on some behavioral traits and some people think that virtue ethics cannot show the people what they should do. The aspects of approach can be classified two approaches. The virtue ethic theory is basically agent centered while the other two that is utilitarianism and deontology act centered. It is very hard to be perfect according to the virtue theory as the behavioral traits toward to be ethical is very much scattered. On the other hand utilitarianism focuses on good or bad state of action rather that right or wrong. The utilitarianism starts with Good action but, deontology starts with Right action. (Crisp 1998). It is very prominent that the deontology is the strongest theory in this aspect. The virtue theory differs from person to person as the scale of measurement is vague. The utilitarianism is again about being good, which again very much blurry in case of measurement of the happiness. But, the Deontology tells something about doing right thing which is very much acceptable in the practical manner. Conclusion: This paper has many ideologies and many technical issues related to the marketing. However, to tackle the real life scenario the new idea must be generated which are basically the brainchild of the innovators, and that the way the marketing approaches move forward. This particular paper is all about the contemporary ways of practicing marketing in the recent time. The approaches and terminologies are used from the reputed international books and research papers. However, the marketing is a function which floats with the trend and it is always changing with its own mood. And eventually the marketing approaches are getting changed automatically within the market and that can be felt with the new concept advertisings and new integrated marketing communications. Read More