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Marketing Management

Marketing Management Understanding
Marketing Development
Marketing Role in the Management System
Marketing Organization
Internal Marketing

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Marketing Management

  1. 1. 1. The Role of Marketing for Business and Marketing Management Understanding
  2. 2.  Market-Driven Management: Strategic and Operational Marketing by Lamben J-J.  Strategic Marketing Management by Philip Kotler and Alexander Chernev  Marketing As Strategy: Understanding the CEO's Agenda for Driving Growth and Innovation by Nirmalya Kumar  Marketing Plans: How to Prepare Them, How to Use Them by Malcolm McDonal and Hugh Wilson  Blue Ocean Strategy: How to Create Uncontested Market Space and Make the Competition Irrelevant by W. Chan Kim and Renée Mauborgne  On Competition by Michael E. Porter  Bottom-Up Marketing/ Marketing Warfare by Al Ries and Jack Trout  Inside the Tornado: Strategies for Developing, Leveraging, and Surviving Hypergrowth Markets by Geoffrey Moore  Business Model Generation by Alex Osterwalder  The Long Tail by Chris Anderson
  3. 3. 1. The Concept of Marketing and Its Development, Important Marketing Trends 2. The Marketing Role in the System of Company Management 3. The Marketing Management Functions (organization, planning, coordination, control) 4. The Notion of Corporate Marketing 5. International and Domestic Practices of Designing the Systems of Marketing Management
  4. 4. The Origin and Development of Marketing  Stages  Origin  1900s-1950s.  Marketing is practically-oriented on the outcome sales. (At this stage the following tools are being employed: advertising, sales stimulation)  Establishment  1960s.  The growth of market competition requires establishing what to produce  1970s.  Marketing as a major tactic function of management. Its tasks are successful trade, customer’s behaviour and environment research which allows to design more effective short-term plans  1980s.  Marketing is becoming the basis of strategic analyses  Active Development (hopefully, in Belarus )  Since 1990s till now.  Marketing is appreciated at both tactic and strategic levels of management. The concept of corporate marketing appears. Business, and therefore, marketing should be socially oriented
  5. 5. 1900-1950s.  In 1915 the company went outside the American market  After only 5 month of TV development in the US the P&G places its first TV ads  In 1941 the customer service is created  1956 – the sales volumes reached USD1 bln 1960s, 1970s  In 1961 the brand ‘Pampers’ appeared on the market  In the 70s the company faced the strategic growth crises. That resulted in the stronger orientation on customer needs and the development of brand policy 1980s.  1983 was the record year in launching new brands (22)  This time there was the external sales expansion of 150%  By the end of the 80s the company – the leader in the most of the European markets, and it began to win on local markets (the Iberian Peninsula, Scandinavian countries and the Balkans) Since 1990s.  Since June 1, 2006 three main directions has been developed by the company: P&G Beauty & Health, P&G Household Care, Global Gillette  2006 - new innovation model – connect and develop – was started; the deep cooperation with retailers, especially with Wal-Mart
  6. 6. The Present-Day Marketing Role  marketing is an important part of the corporation strategy, defines its long-term competitive advantages  marketing supports the organization structure changes and is based on democratic way of decision-making  marketing requires both the corporate culture development and personal motivation  marketing leads to long-term customer relationships  marketing changes thinking and priorities of the whole company team, not only of top managers http://www.mycustomer.com/feature/marketing/2020-vision- three-pillars-marketing-organisation-future/165103
  7. 7.  HBR: Nike transformed the athletic shoe industry with technological innovations, but today many people know the company by its flashy ads and sports celebrities. Is Nike a technology company or a marketing company?  I’d answer that question very differently today than I would have ten years ago. For years, we thought of ourselves as a production-oriented company, meaning we put all our emphasis on designing and manufacturing the product. But now we understand that the most important thing we do is market the product. We’ve come around to saying that Nike is a marketing-oriented company, and the product is our most important marketing tool. What I mean is that marketing knits the whole organization together. The design elements and functional characteristics of the product itself are just part of the overall marketing process.  We used to think that everything started in the lab. Now we realize that everything spins off the consumer. And while technology is still important, the consumer has to lead innovation. We have to innovate for a specific reason, and that reason comes from the market. Otherwise, we’ll end up making museum pieces.
  8. 8.  Large, international corporations tend to become complex organizations, which makes them inflexible. But in fast-growing emerging markets, you cannot expect the same stable conditions that we are used to in mature markets. To succeed in an increasingly volatile market environment, we need simple structures and processes. We are constantly adapting our structures to become faster and more flexible.  To succeed in the highly competitive consumer-goods environment, we need both a management team that reflects the diversity of markets in which we operate and the innovation capabilities to address a broad range of varying consumer needs.  As CEO, I believe that a primary task for me and the management board is to shape Henkel’s growth strategy and clearly communicate it to all employees. Last year, to present our growth strategy for 2016, the management board and I visited 28 sites in 22 countries. Overall, more than 70 town-hall meetings have taken place around the world. And of course, a critical part of my role is to make sure Henkel has the right team in place. So in summary, those are my key tasks as CEO: get the strategy and the team right.
  9. 9.  If you’re long term oriented, customer interests and shareholder interests are aligned. In the short term, that’s not always correct.  One thing that I have learned within the first couple of years of starting the company is that in inventing and pioneering requires a willingness to be misunderstood for long periods of time. One of the early examples of this was the customer reviews. One wrote to me and said, “You don’t understand your business. You make money when you sell things. Why do you allow these negative customer reviews?” And when I read that letter, I thought, we don’t make money when we sell things. We make money when we help customers make purchase decisions.
  10. 10.  Horizon planning – forget trying to plan incrementally in fast and volatile markets. Start with a vision, then work backwards thinking about what you want to achieve with more flexibility within a set of principles and directions  Participation platforms – campaigns are out, platforms are in. Campaigns push short-term messages, quickly forgotten, platforms build enduring ideas built on ongoing participation (Coke’s “Live Positively”)  Solomo consumers – the biggest shift in consumer behaviour is guided by their smartphone, and everything it enables – to be social, and local, and mobile  Zero moment of truth – in a search-driven, digitally enabled engagement process – there is a clear moment when potential customers will choose to love or hate you  Upward innovation – the best ideas come the bottom upwards, not the top down  Multiple Strategy of Branding is more common  Subscription pricing – the biggest trend in pricing is not to sell products around transactions but to sell a subscription, like a magazine, cloud computing
  11. 11.  Emerging markets – the commonest market growth drivers are psychological and demographic aspects  Borderless segments – forget nationalism, think niches and motivation  New social communities – community building is not simple, it’s not just creating a Facebook page but need to being able to unite them under one cause  Crowd creativity – the best ideas are out there, not in your business. So build a crowdsourcing platform and let customers build the best new ideas  Concept innovation – brands are not about products, not about companies, but about bigger ambitions to make life better  New business models – like Apple and Google, rethink how you create value for customers through your partnerships with distribution and supply  Social innovation – ultimately we are all here not just to make money, but to make the world a slightly better place. It is all about social corporate responsibility of business
  12. 12.  The art and science of choosing target markets and getting, keeping, and growing customers through creating, delivering and communicating superior customer value (Kotler Ph., Keller K.)
  13. 13. Marketing Role in the Management System  Management comprises the following levels:  Corporate – marketing as philosophy (company’s values, principles, goals and objectives), the basis for business-model construction  Business (SBU) – marketing as a strategy (segmentation and positioning)  Functional – marketing as a function (marketing department)  Operational – marketing as tactics (4P implementation during a year)
  14. 14. Sistema sees MTS as a promising core asset capable of maintaining good growth rates and increasing shareholder value by implementing its operating strategy.  2013 Strategy ◦ MTS aims at strengthening its position as a leading national mobile operator in Russia and the wider CIS, both in subscriber numbers and revenue. ◦ The company is to increase its revenues and improve customer loyalty by promoting services of MTS through the development of the tariffs «Super 0», «Super MTS». ◦ MTS gives priority to the development of a data segment and new products in order to effectively monetize mobile traffic, ◦ MTS continues active implementation of bank cards "MTS-Money», POS- loans and other financial services through a federal retail chain MTS.  2014 Strategy ◦ MTS invests in expansion of its 3G networks and preparations for a major roll-out of 4G networks. ◦ MTS prioritises the development of new products. MTS’s pay TV will continue expanding due to the launch of digital TV in the Russian regions in September 2012, and in 2013, the implementation of a hybrid TV platform which will consolidate TV broadcasting on three screens (TV, mobile device and computer), and a CDN network. ◦ MTS is becoming an important player in the Russian retail lending market due to its joint project with MTS Bank. The main strategic areas of the MTS Money project are expanding mobile commerce, enhancing mobile payment opportunities, promoting new financial products to the non-banking market, and stimulating the sales of smartphones and data- generating devices
  15. 15.  more emotional slogan “You know that you can“  brand strategy was based earlier on technological leadership, now company appeals in its advertising campaigns to people who count on  The heroes of the new advertising campaign are the ordinary people, while MTS minimizes the involvement of celebrities in advertising
  16. 16. “You know that you can“ be strong carry love through the years challenge tell the truth in the face become a great poet
  17. 17. http://manifest.mts.ru /main
  18. 18. Key Strategy Elements Objectives regarding • the particular product- market position • sales volume • market share • customer satisfaction • profit from the product or the product group SBU objectives • sales volume growth • cash flow • gaining and holding competitive advantages General corporate objectives • profit growth • company’s profitability • return-on-investments • earnings per share Objectives Target markets/ segments Decision-taking concerning depth and width of the product range, branding, commodity markets development Commodity markets for SBU Decision-taking concerning intensive growth and related diversification Types of activity Decision-taking concerning diversification, vertical integration, acquisitions and divisions Scale Marketing strategyBusiness strategyCorporate strategy Element
  19. 19. Top Manages Marketers  Organize and support marketing initiatives  Defend the customers’ interests  Take control over quality  Deal with strategic issues  Interact with various divisions and departments of the enterprise  Practice net-profit- oriented approach
  20. 20.  Marketing organization is a group of marketing persons brought together to make decisions on marketing areas like product, price, place, and promotion. Marketing organization is the foundation of effective sales planning for systematic execution of plans and policies. Marketing organization provides a system of relationships among various marketing functions to be performed by proper coordination among marketing persons.  Definition of Marketing Organization "Marketing organization can be defined as a formal or informal group of individuals working together to reach quantitative and qualitative marketing objectives by making decisions on product, price, place, and promotion."
  21. 21. Let’s get organized! Management Structure with the sharp division between sales’ and marketing functions General Director Deputy Director on Finance Deputy Director on Sales Deputy Director on Marketing Deputy Director on Manufacturing and Operational Process
  22. 22. Management structure with the leading marketing role General Director Finance Director Sales and Supplies Director Marketing Director Manufacturing and Operational Process Director Top Manager of Sales and Supplies Department Top Manager of Marketing Department Vice-President on Marketing
  23. 23.  Advantages (Pros) of centralization ?  Disadvantages (Cons) of centralization ?  Advantages (Pros) of de-centralization ?  Disadvantages (Cons) of de-centralization ?
  24. 24.  The tendencies of corporate planning development ◦ The number of the central planning department in GE became half as small in the early 80-s (up to 15 people) ◦ In 4 out of 73 US corporations people in charge of corporate planning did not have separate special headquarters (HQ) ◦ In the leading department of Heinz Co. strategic planning is developed and designed by the President with the technical assistance of his Secretary and, partly, line managers ◦ Such corporations as HP and J&J lack planning workers at the level of HQ
  25. 25.  “De-centralized management is a nice way of searching for innovations and training corporate leaders”  “We possess more than 200 manufacturing firms; so we need more than 200 great leaders”  “De-centralized approach encourages innovations, it allows people with different skills and different ideas take a try of various products and technologies with the aim of satisfying the hidden needs of patients and clients”  De-centralization also helps in international transactions
  26. 26.  How is it possible to maintain the image of LVMH and take control of the quality of hundreds of product varieties going through the enormous network of suppliers, producers, retailers and marketers? How to keep 76000 focused on work and support their sense of pride for what they do?  “One of the key elements of managing such a set of companies of such a huge scope is de-centralization. And for such a purpose the right team of dedicated managers is highly and badly needed”.
  27. 27. Top-management Middle management ◦ To understand and use the concept of strategic marketing ◦ To study and to practice new methods of designation and implementation of marketing strategies ◦ To follow the already set tasks in terms of marketing strategy ◦ To clarify the strategic goals and make clear the strategic tasks ◦ To educate and put forward the ideas of Strategic Marketing Planning (SMP) ◦ To delegate powers to SMP adherers ◦ To make use of the system of stimulation for the successful implementation of marketing strategies
  28. 28.  Functional - the different marketing activities are grouped on the basis of functions to be performed like - product planning, market research, advertising, sales, or promotion. Each main function is further divided to sub-functions to be performed to achieve marketing objectives. Each sub function is managed by separate manager under the control of marketing manager  Product oriented - common where organisation is producing or marketing wide variety of products. For each product or group of products a separate product manager is assigned and made responsible for marketing decisions for that particular product or group of products  Market oriented - common in big organisations serving large number of customers spreading over large territories. Depot manager, district manager, area manager, zonal manager, divisional manager, etc., are assigned to manage each territories  Customer oriented - common in organisations engaged in providing specialised services to different class of customer
  29. 29. The internal client + the external client? Types of interaction of internal and external company’s clients  Synergy - internal clients  external clients   Alienation - internal clients  external clients   Enforcement - internal clients  external clients   Internal euphoria - internal clients  external clients 
  30. 30. Marketing approach usage towards employees Building-up, stimulation and coordination the personnel for effective application of corporate and marketing strategies The purpose is customers’ satisfaction through the process of interaction with the motivated and client-oriented personnel
  31. 31.  Collecting information about the staff work and their relationship with the customers  Defining the needs of internal clients  Applying the idea of client-oriented policy  Training the personnel to manage non- stardard situations with the clients  Interfunctional cooperation  Clever staffing formation policy
  32. 32.  Staff satisfaction  The high standards of clients’ servicing inside the company  Marketing-oriented personnel  The company’s and production image among the personnel
  33. 33. Adaptation – loyalty is absent Initial loyalty – the employee does not feel part of the company yet Sense of affiliation (belonging to the company) – the employee is an active participant, works really hard and is able to take personal decision in strategy True loyalty – the employee plays the key role in the company and feels its integral part
  34. 34. The 3 main pillars of the L’Oreal EVP are:  A thrilling experience Employees do the talking - A big part of the EVP is getting employees to use their own words and imagery to tell prospective applicants what it’s like to work for L’Oreal. There is an entire website devoted to this called ‘Thrilling Careers at L’Oreal‘.  Inspiring company  School of excellence
  35. 35.  Purpose ◦ Senior leadership ◦ Values ◦ External marketing  Culture ◦ Internal communications ◦ Reward & recognition ◦ Learning & development ◦ Service support  Employment ◦ Working environment ◦ Recruitment & induction ◦ Team management ◦ Performance appraisal ◦ Measurement systems Employer Brand Association sEmployer Branding Employer Image Employer Attraction Organization Identity Organization Culture Employer Brand Loyalty Employer Productivity
  36. 36. Rank 2010 2011 2012 2013 2014 1 Edward Jones SAS Google Google Google 2 Wegmans Food Markets Boston Consulting Group SAS SAS SAS 3 Google Wegmans Food Markets Boston Consulting Group CHG Healthcare Services Boston Consulting Group 4 Nugget Market Google Wegmans Food Markets Boston Consulting Group Edward Jones 5 Edward Jones NetApp NetApp Wegmans Food Markets Quicken Loans
  37. 37. Let’s take control! Trends  The process  The components and elements  The results
  38. 38.  Balance and conformity of the long-term and short-term marketing goals  Analysis of the reasons for the previous success and / failure (UPS AND DOWNS)  Balance between numerical and explanatory information  Working-out of marketing KPI
  39. 39. Clear goals’ and tasks’ definition Supply specification SWOT applicability The ways to lower risks Uniqueness / Originality Tactics evidence Resources in accordance with the importance Analytics!
  40. 40. We have developed – now we implement – and evaluate!  Controlling KPI  Correcting  Depending on / Against external factors alteration  Depending on / Against internal factors alteration

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