Solutions to Assignments
MBA and MBA (Banking & Finance)
MMPC-006 - Marketing Management
Question No. 1
(a) Discuss your understanding of the term marketing with a suitable example. What is the concept of holistic marketing? Explain each of the components and their importance in the exchange process.
→ Meaning of Marketing Concept
Succeeding by meeting the needs of customers is one of the most commonly held ideas of the marketing concept. Organizations that embrace this certain principle eagerly recognize that consumers are the dynamic strength behind their organizations. The concept of marketing is a fundamental piece of the marketing arrangements. Achievement is straightforwardly related to what the client needs.
→ Marketing Concept is a Philosophy
The concept of marketing is the rationality that urges association to concentrate on their clients’ necessities. Breaking down their needs and settling on such choices that fulfill those needs in a superior manner than contenders. To have a superior understanding of the concept of marketing, it’s beneficial to appraise alternate rationalities that once dominated and are being practiced by a few organizations even at present.
→ Importance of Marketing Concept
To put it plainly, the concept of marketing is imperative on the grounds that it characterizes how an organization will conduct business and thrive. It expresses that an organization’s essential occupation is to fulfill the needs of the client. This is proficient by figuring out what the business sector needs and after that adjusting your best product or service to match. To attain this objective, everybody in the organization must be devoted to consumer loyalty. It is likewise imperative to note that the organization must also benefit while fulfilling client needs. A business must target purchasers who they can really serve adequately. This is a business after all and the interim profitability is generally as essential as continuing profitability.
Let us look at the example of 2 interminable opponents – Pepsi and Coke – Both of these organizations sell the same products. However, the value proposal displayed by both is diverse. These organizations flourish with the concept of marketing. Where Pepsi concentrates on youths, Coke conveys on a comprehensive methodology. Additionally, the quality suggestion by Coke has been exceptional over ages as contrasted with Pepsi, which demonstrates that coke particularly flourishes with the advertising idea, i.e. it conveys a better value recommendation as contrasted with its rival.
The concept of marketing additionally demands that the vital choices made by the organization are taken by having the customer in mind and in particular the demands and needs of the customers. An all encompassing methodology is brought to the entire association striving to greatly improve the situation. Applying the concept of marketing additionally means recognizing what the business sector needs and anticipates from the organization as a consequence of which organizations which applies the concept of marketing need to perform more market research.
As we are eventually fulfilling the consumer, the concept of marketing likewise stresses that the association coordinates all its distinctive departments to offer value to the consumer. This implies that all the departments including Operations, Finance, HR or Marketing ought to have an idea of the center aims of the organization and in addition the objective of the organization.
Holistic marketing is a business marketing philosophy which considers business and all its parts as one single entity and gives a shared purpose to every activity and person related to that business.
A business is just like a human body: it has different parts, but it’s only able to function properly when all those parts work together towards the same objective. Holistic marketing concept enforces this interrelatedness and believes that a broad and integrated perspective is essential to attain best results.
Components of Holistic Marketing
Holistic marketing focuses on marketing strategies designed to market the brand to every person related to it, be it employees, existing customers or potential customers, and communicating it in a unified manner while keeping in mind the societal responsibility of the business.
Relationship Marketing
The relationship marketing aspect of holistic marketing philosophy focuses on a long-term customer relationship and engagement rather than short-term goals like customer acquisition and individual sales. This strategy focuses on targeting marketing activities on existing customers to create a strong, emotional, and everlasting customer connections. These connections further help the business in getting repeated sales, free word of mouth marketing and more leads.
Integrated Marketing
Integrated marketing is an approach to create a unified and seamless experience for the consumer to interact with the brand by designing and directing all communication (advertising, sales promotion, direct marketing, public relations, and digital marketing) in such a way so that all work together as a unified force and centres around a strong and focused brand image.
INTEGRATED MARKETING HOLISTIC MARKETING
Internal Marketing
There are two types of customers to every business: internal and external. While focusing on external customers should be a top priority for every business, internal customers should not be left unnoticed as these internal customers (employees) play a vital role in marketing the brand and products to the external customers of the business.
Internal Marketing treats employees and staffs as internal customers who must be convinced of a company’s vision and worth just as aggressively as external customers. It also involves crafting processes which make them understand their role in the marketing process.
INTERNAL MARKETING HOLISTIC MARKETING-01
Socially responsible marketing
The socially responsible marketing aspect of the holistic marketing concept involves a broader concern of the society at large. It requires the business to follow certain business ethics and focuses on partnerships with philanthropic and community organisations. A business is considered as a part of the society and is required to repay the same.
Socially responsible marketing encourage a positive impact on company’s stakeholders.
Why is Holistic Marketing important?
Brand Building
According to a study, intangible assets made up 84% of the S&P 500 market value in 2015 as compared to 1975 where they made up only 17% of the S&P 500 market value.
The customers’ mindset is changing. They believe in buying a brand and not the product alone. Holistic marketing empowers the company to build a brand among all its stakeholders.
Consistency
Consistency is important to stay in the market for long. Since holistic marketing concept involves marketing the brand to all the stakeholders and through unified communication strategies, consistency is maintained.
Efficiency
When every aspect of the business is taken care of, it becomes easier to reduce (and even eliminate) repetition, become more efficient, and save company’s time and money. The efficiency can also be seen in tapping opportunities and spotting potential threats.
Effectiveness
Holistic marketing philosophy, by focusing on the big picture, creates a synergy that effectively reinforces the brand message, brand image, and positions the brand uniquely in the minds of the customers.
(b) Why and how Segmentation, Targeting and Positioning (STP) concept is used in Marketing? Discuss with an illustration.
STP marketing is an acronym for Segmentation, Targeting, and Positioning – a three-step model that examines your products or services as well as the way you communicate their benefits to specific customer segments.
In a nutshell, the STP marketing model means you segment your market, target select customer segments with marketing campaigns tailored to their preferences, and adjust your positioning according to their desires and expectations.
STP marketing is effective because it focuses on breaking your customer base into smaller groups, allowing you to develop very specific marketing strategies to reach and engage each target audience.
In fact, 59% of customers say that personalization influences their shopping decision and another 44% said that a personalized shopping experience would influence them to become repeat customers of a brand.
STP marketing represents a shift from product-focused marketing to customer-focused marketing. This shift gives businesses a chance to gain a better understanding of who their ideal customers are and how to reach them. In short, the more personalized and targeted your marketing efforts, the more successful you will be.
Segmentation
The first step of the STP marketing model is the segmentation stage. The main goal here is to create various customer segments based on specific criteria and traits that you choose. The four main types of audience segmentation include:
Geographic segmentation: Diving your audience based on country, region, state, province, etc.
Demographic segmentation: Dividing your audience based on age, gender, education level, occupation, gender, etc.
Behavioral segmentation: Dividing your audience based on how they interact with your business: What they buy, how often they buy, what they browse, etc.
Psychographic segmentation: Dividing your audience based on “who” your potential customer is: Lifestyle, hobbies, activities, opinions, etc.
Targeting
Step two of the STP marketing model is targeting. Your main goal here is to look at the segments you have created before and determine which of those segments are most likely to generate desired conversions (depending on your marketing campaign, those can range from product sales to micro conversions like email signups).
Your ideal segment is one that is actively growing, has high profitability, and has a low cost of acquisition:
Size: Consider how large your segment is as well as its future growth potential.
Profitability: Consider which of your segments are willing to spend the most money on your product or service. Determine the lifetime value of customers in each segment and compare.
Reachability: Consider how easy or difficult it will be for you to reach each segment with your marketing efforts. Consider customer acquisition costs (CACs) for each segment. Higher CAC means lower profitability.
There are limitless factors to consider when selecting an audience to target – we’ll get into a few more later on – so be sure that everything you consider fits with your target customer and their needs.
Positioning
The final step in this framework is positioning, which allows you to set your product or services apart from the competition in the minds of your target audience. There are a lot of businesses that do something similar to you, so you need to find what it is that makes you stand out.
All the different factors that you considered in the first two steps should have made it easy for you to identify your niche. There are three positioning factors that can help you gain a competitive edge:
Symbolic positioning: Enhance the self-image, belongingness, or even ego of your customers. The luxury car industry is a great example of this – they serve the same purpose as any other car but they also boost their customer’s self-esteem and image.
Functional positioning: Solve your customer’s problem and provide them with genuine benefits.
Experiential positioning: Focus on the emotional connection that your customers have with your product, service, or brand.
The most successful product positioning is a combination of all three factors. One way to visualize this is by creating a perceptual map for your industry. Focus on what is important for your customers and see where you and your competitors land on the map.
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