U5: Marketing of Goods and Services
What it’s Marketing?
According to the AMA (American Marketing Association), marketing is the activity of an institution/s to create communication processes that deliver and exchange the flow of information, specifically, products that hold value for clients, customers, partners, and society.
Producing goods and services is not enough, marketing needs to be considered to incentive customer’s to buy the product. Research needs to be conducted in order to analyse data that can link the customer to the marketer. This data can be used to identify possible challenges and opportunities.
Another important use of marketing, is helping organizations to define its brand, a distinctive and unique intangible asset that helps customers to identify and associate certain thoughts or advertises with a product and distinguish them from the competence.
Key question:
What is the main challenge in getting consumers to buy new products and how do companies usually approach this challenge?
Goals of Marketing
Increased Brand Awareness: built trust among at customers, this works as an incentive for customers to buy their products. Companies develop branding strategies, that define things like: what a brand is supposed to communicate and how they would build their brand step by step.
Lead Generation: leads = potential buyers that are starting to get interested in your product. It’s the job of marketing and sales specialists to convert those leads into buyers. Nowadays, there’s a variety of resources that can be used to generate leads, combinations of conventional and progressive ways can be used to generate leads, such as implementing AI chatbots that interact with those interested in the product.
Grow and keep through leadership: being recognized as an expert in the field, the best way to build credibility and knowledge. Other ways to support thought leadership is by interacting with the customers, addressing their concerns about the product and taking suggestions to improve it, it’s another way to keep and grow the relationship between the company and the customer.
Increase customer value: companies need to focus not only in converting leads into customers but also in customer retention. If a customer is delighted with a product, not only they while keep buying, but they may turn into a brand ambassador, recommending that product to everyone around them.
Colleague empowerment: incentive colleagues across different areas to implement a customer focused mindset, while also educating them in the use of new tools and resources that can simplify their jobs. This can lead to build a sense of confidence, collaboration, and loyalty in the workspace.
Types of Marketing
Social Marketing: implemented in the 70s, companies realized that it was possible to use marketing principles not only to sell goods and services but also ideas, attitudes, and behaviours. Its goal is to produce positive change by understanding what people want.
Service Marketing: elaborated strategies to communicate the value of intangible products.
Green Marketing: response to the shift of focus of the customer, from product technicalities to product’s environmental footprint. Place sustainability at the centre of their marketing efforts. Combines the marketing mix elements in an environmentally friendly ways that appeals to consumers concerned with ecological issues. Effective and impactful green marketing is a mechanism that can help lead to a long-term success.
Direct Marketing: building direct relations between the company and the customer, by selling the product directly to them. With this, companies intend to build loyalty among existing customers while also attracting new ones. Direct Marketing tends to be more effective than other forms of mass marketing because it allows organizations to reach a specific target group. As it only targets the audience that would want or need the product, this enhances efficiency and allows for flexibility when it comes to marketing methods.
Two-way communication.
Holistic Marketing: focuses on seeing “the big picture”, companies that implement this type of marketing see themselves as part of the overall business universe and analyse multiple viewpoints of the organization’s commercial activities. This approach recognizes all that all variables matter and considers the whole business system when crafting a marketing strategy. And when implementing the strategy, all tasks are extremely coordinates in order to achieve cooperation and deliver the best possible value to customers. Common in large firms.
The Marketing Mix
One of the most practical business concepts. Four questions that need to be answered, also referred to as “the 4 P’s”:
Product. This is anything that can be offered that requires marketing activities. Products can be physical goods, services, solutions, and ideas. Every product has aspects that are both tangible and intangible.
Price. This is something that is given in exchange for a good, service, solution, or idea.
Price does not have to be monetary; for example, you are spending time reading
about the four Ps, so its price is time spent.
Place. This is how a product gets from creator to customer. This requires many important tasks, such as coordination, location, inventory, supply chain management, digital presence, and atmospherics (how a physical or digital space looks and feels).
Promotion. This is how consumers can be informed and influenced to buy something.
There are several components of promotion, including traditional marketing, promotions, community relations, digital platforms, and personal selling. Often, promotion is mistaken for marketing because it is typically the most visual part of marketing.
In the 1980s, three new P’s were added:
People
Processes
Physical evidence
These items need to be synchronized with each other, they don’t work on their own.
Influencing Forces of Marketing
Understanding the external environment helps marketers create effective campaigns, it is indispensable to assess different environmental factor in order to create a successful campaign. Marketing decisions depend on six environmental factors:
Cultural and Social: buying patterns of specific cultures or sub-cultures, changing social dynamics and trends
Demographics: generational preferences, birth rates, death rates, location of target groups.
Economic: changes in the economic environment, employment rates, income levels, inflation, and recessions.
Technological: factors associated with technological advances. E.g.: AI, IoT, automation, and digitalization.
Political/legal: refers to the legal and regulatory environment where the organization operates, along with any political movement.
Competitive: factors associated with domestic and international competition.
Marketing Management
Marketing management plays a crucial role in the success of any business by strategically planning and implementing activities to promote products or services to target customers. It involves a series of interconnected functions that are essential for achieving the company's goals and objectives.
Significance of Marketing Management
It helps in identifying customer needs, creating value for customers, and building strong customer relationships. By understanding market trends and consumer behaviour, companies can develop effective marketing strategies to stay ahead of the competition.
Functions of Marketing Management
Market Analysis: Conducting market research to understand consumer preferences, market trends, and competitor strategies.
Strategic Planning: Developing long-term marketing strategies to achieve business objectives and maximize profitability.
Product Development: Creating and improving products or services based on customer feedback and market demands.
Promotion: Designing marketing campaigns to increase brand awareness and attract target customers.
Distribution: Planning and managing the distribution channels to ensure products reach customers efficiently.
Marketing Process
The marketing process consists of several key steps that guide companies in achieving their marketing objectives:
Marketing Strategy: This involves creating a plan to deliver value to customers and achieve a competitive advantage in the market.
Marketing Objectives: Setting specific and measurable goals that align with the overall business objectives.
Marketing Tactics: Implementing the marketing mix, which includes product, price, place, and promotion strategies to reach the target audience.
Marketing Implementation & Controlling: Executing the marketing plan and monitoring performance to ensure that objectives are met and making adjustments as needed to improve results.