Additional Information: The Marketing Concept

The marketing concept is the idea that a business should strive to satisfy customers’ needs and wants while generating a profit for the firm. The focus is on the customer. For an organization to be successful, all seven functions of marketing need to support this idea. The personnel responsible for those functions must understand the marketing concept and reach for the same goal in order to send a consistent message to the customer. The message is that the customer satisfaction is most important. Everyone in an organization needs to recognize that repeat customers keep a company in business. For example, the switchboard operator in a large corporation or the pizza delivery person must understand the marketing concept and be mindful of the company’s goals. Everyone in an organization is an extension of that firm and must provide the best possible service to its customers. Businesses that stress the marketing concept with all employees are successful.

Customer Relationship Management (crm)

In today’s marketplace, customer relationship is most important. Customer relationship management (CRM) is an aspect of marketing that combines customer information (through database and computer technology) with customer service and marketing communications. Marketers who specialize in CRM try to create more meaningful one-on-one communications with the customer by applying customer data (demographic, industry, buying history, etc.) to every communication. [Marketing Essentials, green, p.7]

3. What Marketers Do

In order to reach the goal of creating a relationship that holds value for customers and for the organization, marketers use a diverse (різні) toolkit (засоби, набір інструментів) that includes (but is not limited to) making decisions regarding:

• Target Markets – those markets identified as possessing needs the marketer believes can be addressed by its marketing efforts

• Products/Services – a tangible (матеріальне) or intangible (нематеріальне) solution (вирішення) to the market’s needs (потреб ринку)

• Promotion – a means for communicating information about the marketing organization’s solution to the market

• Distribution – means used to allow the market to obtain the solution

• Pricing – ways for the marketer to adjust the cost to the market for the solution

• Services – additional options that increase (збільшують) the solution’s value

Each option within the marketer’s toolkit is tightly integrated with all other options so that a decision in one area could and often does impact (впливає на) decisions in other areas. For instance, a change in the price of a product (e.g., lowering the price) could impact the distribution area (e.g., increases shipments, generates higher store traffic).

Additionally, options within the toolkit are affected by factors that are not controlled by the marketer. These factors include economic conditions, legal issues, technological developments, social/cultural changes, and many more. While not controllable, these external factors must be monitored and dealt with since these can potentially cause (спричинити) considerable harm to the organization. Ignoring outside elements also can lead to missed opportunities in the market especially if competitors are the first to take advantage of the opportunities. As part of the strategic and tactical planning process discussed above it would be wise for marketers to pay close attention to the environment outside the organization.

Finally as noted earlier, research plays a significant role in all marketing decisions areas. Marketing decisions should not be made without first committing time to obtaining needed information. (Маркетингові рішення не можуть бути прийняті, не затративши спершу час на те, щоб отримати необхідну інформацію.)

The Importance of Good Customers

Today, most successful marketers know that building customers for the long term holds more value to the marketer than short-term sales. They also are aware (усвідомлюють) that current customers who are satisfied with the purchases they have made in the past are the best source for future sales. Why? Because they have first-hand experienced with the organization and, if they have been satisfied with past purchases, they probably trust the organization. Thus, convincing (переконати) these customers to make more purchases requires significantly less effort (i.e., marketing expenditures (costs)) when compared to efforts and costs needed to attract new customers. This philosophy is at the heart of the previously discussed CRM and this approach to managing customers has attracted much interest in the last few years. Under CRM the key driver for marketing success is to treat good customers in a way that will increase the probability they will stay good customers.

The fact that we place the descriptive term “good” in front of “customers” should not be taken lightly. Not all customers are the same. Some consistently spend large sums to purchase products from an organization; others do not spend large sums but hold the potential to do so; and still others use up a large amount of an organization’s resources but contribute little revenue. Clearly there are lines of demarcation between customers. As we will see later, identifying this line is critical for marketing success.