MARKETING MANAGEMENT

Marketing management employs tools from economics and competitive strategy to analyze the industry context in which the firm operates. These include Porter’s five forces, analysis of strategic groups of competitors, value chain analysis, and others.

In competitor analysis, marketers build detailed profiles of each competitor in the market, focusing on their relative competitive strengths and weaknesses using SWOT analysis. Marketing managers will examine each competitor’s cost structure, sources of profits, resources and competencies, competitive positioning and product differentiation, degree of vertical integration, historical responses to industry developments, and other factors.

Marketing management often conducts market research and marketing research to perform marketing analysis. Marketers employ a variety of techniques to conduct market research, but some of the more common include:

• Qualitative marketing research, such as focus groups and various types of interviews
• Quantitative marketing research, such as statistical surveys
• Experimental techniques such as test markets
• Observational techniques such as ethnographic (on-site) observation

Marketing managers may also design and oversee various environmental scanning and competitive intelligence processes to help identify trends and inform the company’s marketing analysis.

Marketing strategy

Two customer segments are often selected as targets because they score highly on two dimensions:

1. The segment is attractive to serve because it is large, growing, makes frequent purchases, is not price sensitive (i.e. is willing to pay high prices), or other factors; and
2. The company has the resources and capabilities to compete for the segment’s business, can meet their needs better than the competition, and can do so profitably.

A commonly cited definition of marketing is simply “meeting needs profitably”.

The implication of selecting target segments is that the business will subsequently allocate more resources to acquire and retain customers in the target segment(s) than it will for other, non-targeted customers. In some cases, the firm may go so far as to turn away customers who are not in its target segment. The doorman at a swanky nightclub, for example, may deny entry to unfashionably dressed individuals because the business has made a strategic decision to target the “high fashion” segment of nightclub patrons.

In conjunction with targeting decisions, marketing managers will identify the desired positioning they want the company, product, or brand to occupy in the target customer’s mind. This positioning is often an encapsulation of a key benefit the company’s product or service offers that is differentiated and superior to the benefits offered by competitive products. For example, Volvo has traditionally positioned its products in the automobile market in North America in order to be perceived as the leader in “safety”, whereas BMW has traditionally positioned its brand to be perceived as the leader in “performance”.

Ideally, a firm’s positioning can be maintained over a long period of time because the company possesses, or can develop, some form of sustainable competitive advantage. The positioning should also be sufficiently relevant to the target segment such that it will drive the purchasing behavior of target customers. To sum up, the marketing branch of a company is to deal with the selling and popularity of its products among people and its customers, as the central and eventual goal of a company is customer satisfaction and the return of revenue.