Marketing: Part One in Business Management:

Introduction

                          Porter’s Value Chain for businesses

Marketing is a link in the value chain of businesses as shown in the diagram above……historically marketing has developed independently making its own contribution and has boosted not only businesses but other organizations as well. Read more

Signal Criteria  and  Use Criteria of Marketing

The implosion of the Twin Towers of the World Trade Centre in New York 9/11/2001  dramatizes  the disaster that can happen when the two criteria between a buyer and seller fail. Let me explain.

The seller puts out signal criteria, first sets the parameters and draws the attention – this is achieved through all those promotional tools such as websites, advertising, brand names, media reports, TV and radio magazine programs, as well as one-minute elevator pitch  presentations . It is communication that strikes a chord and gives a message that stays.

The experience of the buyer, use criteria  the product or service will be used because of signalling – if the user is pleased, accepts, is rewarded and believes the product or service either improves user performance or reduces user costs or both, then we have a chemical equation, like H2 + 0 = H20 (water). Signalling Criteria + Use Criteria = Success.

The seller is not going to achieve user acceptance without signalling, and the better the signal the more pressure to achieve use criteria. Without signalling the public doesn’t know what you are about, whether you want to succeed or not, whether you believe passionately in your product or service – be this in an institution of education  or the promotion of a Volkswagen car.

Signalling must be continuous, the public or users need to be reassured that they are getting the best. Good signalling should not mislead anyone, what the user needs is apparent and then signalled.

If there are lies, dam lies, fake information… credibility is lost…. It is…. 9/11. The implosion of Twin Towers one tower representing sellers signal criteria and the other the buyer use criteria……they have been flattened.

Historic developments

In earlier times, a period from 1900 to1980 the emphasis was on production. A good product sold itself with limited promotion…...this particularly applied to home appliances as well as cars. Henry Ford said of his Model T Ford. “You can buy any colour as long as it is black”. This was the attitude then, production was king.

In countries like Germany quality was a key factor, manufactured products lasted a long time and if they broke down, they were fixed within a short period. Krups Household Appliances was an example. If a product could not be fixed in 48 hours, a new product was supplied free of charge. That’s how confident Krups was of their quality.

This era of production was followed by the rise of mass- production. Price would have played a major part; competition would have been stiff, assisted by mass media (radio and TV). Countries like Japan became very good at replicating products, at first, of poor quality (Jap crap), later Japan led the world in quality standards, quality became their market strength.

Technology

The advances of technology played a part in mass production…...new and more user-friendly models came onto the market frequently. There was a demand for updated models using new technology this created the throw away society. Electronic models of numerous products, not only home appliances but computers, printers, copiers, cell phones and more……were only kept for a few years.

 Customer Centric

Marketing progressed after the Second World War (after 1945) together with management. Competition increased in a world that supported the free market.  By the 1980s the focus of marketing was to give the customer what they needed, it ment suppliers becoming customer centric. Businesses focused on understanding customer needs, preferences, and behaviour…… to tailor make their offerings and experiences. This took the focus away from hard selling.

In essence, modern marketing is about building long-term relationships with customers by providing value, addressing their needs, and creating a positive brand experience.

 The difference between selling and marketing

 Selling focuses on the needs of the seller, whereas marketing focus is on the needs of the buyer (customer). Selling is preoccupied with the seller’s need to convert product to cash, while marketing is associated with satisfying the needs of a customer by paying attention to a whole cluster of things – including creating, innovation, distribution channel, quality, use or consumption of the product, etc

 Michael Porter

Michael Porter became one of the leading thinkers and authors in marketing. He might have been the first to state that a product is either purchased on price or on differentiation…...  a quality product with refinements. Porter is also known for his work in Strategic Planning. His major contributions include signal and use criteria, the two charts the one in our introduction the Value Chain of a business entity and the other the Five Competitive Forces that determine an industries profitability.

Strategic planning also started playing a major role, emphasizing a firms marketing philosophy…… important were brand names, mission statements, and a firm’s core values both moral and in competency. The SWOT analysis (strengths, weaknesses, opportunities and threats) is a great tool in a buzz session for evaluating a firm’s marketing strategy.

Marketing’s leadership Role in Society

Marketing with its customer centric approach joins management and can be used by any organization. This could be the Department of Education, Department of Health, Home Affairs, or our Police Force, could we suggest a signal? For our Department of Education, “Inspiring Curiosity, Igniting Possibilities.”

Empathy in Marketing

I first saw the word used in marketing in Walter Isaacson’s book “Steve Jobs.” It was the first principle he learnt in marketing from his mentor.

·         Empathy is a word that sits between sympathy and compassion.

·         Sympathy is feeling sorry for someone else's misfortune,

·         Empathy is the ability to understand and share the feelings of others. It is placing oneself in another person's shoes.

·         Compassion is the desire to mitigate the pain of others.

Marketing is using a strong word; empathy not yet moving to compassion, but it is indicating its sincere caring for customers. I am not going to mention the cynics. It would be great, if South Africa could overtake businesses’ empathy in  marketing by becoming a compassionate society …. mitigating the pain of others.  

Steve Jobs clarified the principle of giving the customer what they want. To quote; “Our job is to figure out what the customer is going to want before they do. Mostly people don't know what they want until you show them.”

Another quote from a Marketing sage, Philip Kotler

“Good companies will meet needs: great companies will create markets.”   

Summary and Conclusion

Marketing is one of those endeavours that takes one outside of oneself. That's where the opportunities are...  out there, in the wide open world, with blue skies. Marketing is by nature creative, certainly imagination and innovation come from within oneself but the action of making it happen puts you on the front foot.

Neil Wright