THE CHANGING MARKETING LANDSCAPE- marketing 5

THE CHANGING MARKETING LANDSCAPE

This section explores five major developments: the changing economic environment, the digital age, the growth of not-for-profit marketing, rapid globalization, and the call for more social responsibility.

The Changing Economic Environment
The Great Recession, which began in 2008, caused many consumers to rethink their spending priorities and cut back on their buying.
Companies in all industries have aligned their marketing strategies with these new economic realities, stressing value above all.
Wealthier consumers have joined the trend toward frugality. Even luxury brands are stressing value.
A recession creates winners and losers, just like a boom. A troubled economy can present companies with opportunities as well as threats.

The Digital Age
The recent technology boom has created a digital age. The most dramatic new technology is the Internet.  The digital age has provided marketers with new ways to learn about and track customers, and to create products and services tailored to individual needs. Digital media has become a global phenomenon.
Online marketing is now the fastest growing form of marketing. In addition to the “click-only” dot-coms, most traditional “brick-and-mortar” companies have now become “click-and-mortar” companies.
The Growth of Not-for-Profit Marketing
In recent years, marketing has also become a major part of the strategies of many not-for-profit organizations, such as colleges, hospitals, museums, zoos, symphony orchestras, and even churches. The nation’s nonprofits face stiff competition for support and membership. Sound marketing can help them to attract membership and support.

Rapid Globalization
Marketers are now connected globally with their customers and marketing partners. Almost every company, large or small, is touched in some way by global competition. McDonald’s now serves 60 million customers daily in 32,000 restaurants worldwide—some 66 percent of its revenues come from outside the United States. Today, companies are buying more supplies and components abroad.

Sustainable Marketing—The Call for More Social Responsibility
Marketers are reexamining their relationships with social values and responsibilities and the very Earth that sustains us. Corporate ethics and social responsibility have become hot topics for almost every business. Forward-looking companies view socially responsible actions as an opportunity to do well by doing-good.

SO, WHAT IS MARKETING? PULLING IT ALL TOGETHER
Marketing is the process of building profitable customer relationships by creating value for customers and capturing value in return. The first four steps in the marketing process create value for customers. The final step in the process allows the company to capture value from customers. When building customer and partner relationships, companies must harness marketing technology, take advantage of global opportunities, and act in an ethical and socially responsible way.


LN 02: Strategic Market Planning

Strategic planning is the process of developing and maintaining a strategic fit between the organization’s goals and capabilities and its changing market opportunities. Strategic planning sets the stage for the rest of the planning in the firm. Companies typically prepare annual plans, long-range plans, and strategic plans.

Defining a Market-Oriented Mission: Many organizations develop formal mission statements. A mission statement is a statement of the organization’s purpose—what it wants to accomplish in the larger environment. A clear mission statement acts as an “invisible hand” that guides people in the organization. A market-oriented mission statement defines the business in terms of satisfying basic customer needs. Management should avoid making its mission too narrow or too broad. Missions should be realistic, specific, fit the market environment, based on the company’s distinctive competencies, and motivating.

Setting Company Objectives and Goals: The company’s mission needs to be turned into detailed supporting objectives for each level of management. The mission leads to a hierarchy of objectives, including business objectives and marketing objectives. Marketing strategies and programs must be developed to support these marketing objectives.

Designing the Business Portfolio: A business portfolio is the collection of businesses and products that make up the company. The best portfolio is the one that best fits the company’s strengths and weaknesses to opportunities in the environment.

Analyzing the Current Business Portfolio: The major activity in strategic planning is business portfolio analysis, whereby management evaluates the products and businesses making up the company. A strategic business unit (SBU) is a unit of the company which has a separate mission and objectives and that can be planned independently from other company businesses. The next step in business portfolio analysis calls for management to assess the attractiveness of its various SBUs and decide how much support each deserves. Most standard portfolio-analysis methods evaluate SBUs on two important dimensions—the attractiveness of the SBU’s market or industry and the strength of the SBU’s position in that market or industry. The Boston Consulting Group Approach. The best-known portfolio-planning method was developed by the Boston Consulting Group.
This matrix defines four types of SBUs:
• Stars: high-growth market, high-share product
• Cash cows: low-growth market, high-share product
• Question marks: low-share product, high-growth market
• Dogs: low-share product, low-growth market

Once it has classified its SBUs, the company must determine what role each will play in the future. The company can invest more in the business unit in order to grow its share. It can invest just enough to hold the SBU’s share at the current level. It can harvest the SBU, milking its short-term cash flow regardless of the long-term effect. Or it can divest the SBU by selling it or phasing it out.