Mma6e Chapter 22

Marketing Management:
An Asian Perspective,
6th Edition
Instructor Supplements
Created by Geoffrey da Silva
Managing a Holistic Marketing Organization
3 © Pearson Education South Asia Pte Ltd 2013. All rights reserved
22
Learning Issues for Chapter Twenty One
1. What are important trends in marketing practices?
2. What are the keys to effective internal marketing?
3. How can companies be responsible social marketers?
4. How can a company improve its marketing skills?
5. What tools are available to help companies monitor and

improve their marketing activities?
Chapter Outline
• Healthy long-term growth for a brand requires that the

marketing organization be managed properly.
• Holistic marketers must engage in a host of carefully planned,

interconnected marketing activities and satisfy an increasingly
broader set of constituents.
• They must also consider a wider range of effects of their

actions.
Chapter Outline
• Corporate social responsibility and sustainability have become

a priority as organizations grapple with the short-term and
long-term effects of their marketing. Some firms have
embraced this new vision of corporate enlightenment and
made it the very core of what they do.
• Successful holistic marketing requires effective relationship

marketing, integrated marketing, internal marketing, and
performance marketing.
Trends in Marketing Practices
• Chapters 1 and 3 described some important changes in the

marketing macroenvironment. These include the following:
– globalization,
– deregulation,
– technological advances,
– customer empowerment, and
– market fragmentation.
• In response to this rapidly changing environment, companies

have restructured their business and marketing practices as
summarized in Table 22.1.
Table 22.1: Important Shifts in Marketing and
Business Practices
Challenges Facing Marketers
• Recently, marketers have had to operate in a slow-growth economic

environment characterized by discriminating consumers, aggressive
competition, and a turbulent marketplace.
• As consumers become more disciplined in their spending and adopt

a “less is more” attitude, it is incumbent on marketers to create and
communicate the true value of their products and services.
• Emerging markets such as India and China offer enormous new

sources of demand—but often only for certain types of products and
at certain price points.
Business Failures
Companies cannot win by standing still. Recent business problems and failures by firms such as
Borders and Kodak reflect an inability to adjust to a dramatically different marketing environment.
• Across all markets, marketing plans and programs will grow

more localized and culturally sensitive, while strong brands
that are well differentiated and continually improved will
remain fundamental to marketing success.
• Businesses will continue to use social media more and

traditional media less. The Web allows unprecedented depth
and breadth in communications and distribution, and its
transparency requires companies to be honest and authentic.
• Marketers also face ethical dilemmas and perplexing

tradeoffs. Consumers may value convenience, but how to
justify disposable products or elaborate packaging in a world
trying to minimize waste? Increasing material aspirations can
defy the need for sustainability.
• Given increasing consumer sensitivity and government

regulation, smart companies are creatively designing with
energy efficiency, carbon footprints, toxicity, and disposability
in mind. Some are choosing local suppliers over distant ones.
Auto companies and airlines must be particularly conscious of
releasing CO2 in the atmosphere.
Sensitivity to the Environment
Functionally successful products that consumers see as good for the environment can offer enticing
options. Toyota is now rolling out hybrids throughout its auto lineup.
Thinking Holistically in Marketing
• Now more than ever, marketers must think holistically and

use creative win-win solutions to balance conflicting
demands.
• They must develop fully integrated marketing programs and

meaningful relationships with a range of constituents.
Internal Marketing
• The role of marketing in the organization is changing.
• Traditionally, marketers have played the role of middlemen.
• In a networked enterprise every functional area can interact directly with

customers.
• Marketing in a networked enterprise must integrate all the customer-facing

processes so that the customer sees a single face and hears a single voice
when they interact with the firm.
• Internal marketing requires that everyone in the organization buy into the
concepts and goals of marketing and engage in choosing, providing, and
communicating customer value.
Internal Marketing
• A company can have an excellent marketing department, yet fail at

marketing.
• Much depends upon how the other company departments view customers.
• Only when all employees realize that their jobs are to create, serve, and
satisfy customers does the company become an effective marketer.
• Many companies are now focusing on key processes rather than

departments to serve the customer.
• To achieve customer-related outcomes, companies appoint process leaders

who manage cross-disciplinary teams.
Organizing the Marketing Department
Modern marketing departments may be organized in a number

of different, sometimes overlapping ways:
– functionally,
– geographically,
– by product or brand,
– by market,
– in a matrix, and
– by corporate or division.
Functional Organization
• In the most common form of marketing organization consists

of functional specialists reporting to a marketing vice
president, who coordinates their activities.
• Additional specialists might include:

i. Customer service manager
ii. Marketing planning manager
iii. Market logistic manager
iv. Direct marketing manager
v. Internet marketing manager
Figure 22.1: Functional Organization
• The main advantage of a functional marketing organization is

its administrative simplicity.
• However, it can be quite a challenge to develop smooth

working relations within the marketing department.
• This form can also lose its effectiveness as products and

markets increase.
• A functional organization often leads to inadequate planning

for specific products and markets. Products that are not
favored by anyone are neglected.
• Then, each functional group competes with others for budget

and status. The marketing vice president constantly has to
weigh the claims of competing functional specialists and faces
a difficult coordination problem.
Geographic Organization
• A company selling in a national market often organizes its sales

force along geographic lines.
• Some companies are now adding area-marketing specialists

(regional or local marketing managers) to support the sales efforts
in high-volume markets.
• Improved information and marketing research technologies have

spurred regionalization.
• Some companies have to develop different marketing programs in

different parts of the country because geography alters their brand
development so much.
Product or Brand Management Organization
• Companies producing a variety of products and brands often

establish a product (or brand) management organization.
• The product-management organization does not replace the

functional organization but serves as another layer of management.
• A product-management organization makes sense if the company’s

products are quite different, or if the sheer number of products is
beyond the ability of a functional organization to handle.
• Product and brand management is sometimes characterized as a

hub-and-spoke system (see Figure 22.2).
Figure 22.2: The Product Manager’s Interactions
The brand or product manager is figuratively at the center, with spokes leading to various
departments representing working relationships.
Product Manager’s Tasks
• Developing a long-range and competitive strategy for the product
• Preparing an annual marketing plan and sales forecast
• Working with advertising and merchandising agencies
• Increasing support of the product among the sales force and

distributors
• Gathering continuous intelligence on the product’s performance,

customer and dealer attitudes, and new problems and opportunities
• Initiating product improvements to meet changing market needs
Disadvantages of Product Management
1. Product and brand managers may lack authority to carry out

their responsibilities.
2. Product and brand managers become experts in their product

area but rarely achieve functional expertise.
3. The product management system often turns out to be

costly.
Disadvantages of Product Management
4. Brand managers normally manage a brand for only a short

time.
5. The fragmentation of markets makes it harder to develop a

national strategy from headquarters.
6. Product and brand managers cause the company to focus on

building marketing share rather than building the customer
relationship.
Alternative to Product Management Organization
• A second alternative in a product-

management organization is
product teams. There are three
types: vertical, triangular, and
horizontal (see Figure 22.3).
• The triangular and horizontal

product-team approaches let each
major brand be run by a brand-
asset management team (BAMT)
consisting of key representatives
from functions that affect the
brand’s performance.
• The company consists of several

BAMTs that periodically report to
a BAMT directors committee,
which itself reports to a chief
branding officer.
• This is quite different from the

way brands have traditionally
been handled.
• A third alternative for product management organization is to

eliminate product manger positions for minor products and
assign two or more products to each remaining manager.
• A fourth alternative is to introduce category management

in which a company focuses on product categories to manage
its brands.
Category Management
• A rationale for category management is the increasing power

of the trade who thinks in terms of category of products, not
individual product lines.
• Another rationale is the increasing power of the retail trade,

which has tended to think of profitability in terms of product
categories.
• In fact, in some packaged-goods firms, category management

has evolved into aisle management and encompasses
multiple related categories typically found in the same
sections of supermarkets and grocery stores.
Category Management by P&G
Procter & Gamble practices category management to ensure adequate resources for all categories
and better coordination. Category management also helps retailers gain more profit by reorganizing
their shelves.
Market-management Organization
• When customers fall into different user groups with distinct buying
preferences and practices, a market-management organization is
desirable.
• Market manager supervises several market managers (also called

market development managers, market specialists, or industry
specialists).
• Market managers are staff people and develop long-range and

annual plans for their markets.
• Market managers are judged by their market’s growth and

profitability.
Market-management Organization
• Many companies are reorganizing along market lines and

becoming market-centered organizations.
• When a close relationship is advantageous, such as when

customers have diverse and complex requirements and buy
an integrated bundle of products and services, a customer-
management organization, which deals with individual
customers rather than with the mass market or even market
segments.
• Technology has facilitated the creation of customer-

management organizations.
Matrix-management Organization
• Companies that produce many products flowing into many

markets adopt a matrix organization employing both product
and market managers.
• The rub is that this system is costly and often creates

conflicts, here are two examples:
– How should the sales force be organized?
– Who should set the prices for a particular product or market?
Matrix-management Organization
• Some corporate marketing groups assist top management

with overall opportunity evaluation, provide divisions with
consulting assistance on request, help divisions that have
little or no marketing, and promote the marketing concept
throughout the company.
Relations with Other Departments
• Under the marketing concept, all departments need to “think

customer” and work together to satisfy customer needs and
expectations. Yet departments define company problems and
goals from their viewpoint, so conflicts of interest and
communications problems are unavoidable.
• The marketing vice president, or CMO, has two tasks:

i. To coordinate the company’s internal marketing activities.
ii. To coordinate marketing with finance, operations, and other
company functions to serve the customer.
• Yet there is little agreement on how much influence and

authority marketing should have over other departments.
• Typically, the marketing vice president must work through

permission rather than authority.
• To help marketing and other functions jointly determine what

is in the company’s best interests, firms can provide joint
seminars, joint committees and liaison employees, employee
exchange programs, and analytical methods to determine the
most profitable course of action.
• Companies need to develop a balanced orientation in which

marketing and other functions jointly determine what is in the
company’s best interests.
• Many companies now focus on key processes rather than

departments, because departmental organizations can be a barrier
to smooth performance.
• They appoint process leaders, who manage cross-disciplinary teams

that include marketing and salespeople.
• Marketers thus may have a solid-line responsibility to their teams

and a dotted-line responsibility to the marketing department.
Building a Creative Marketing Organization
• Many companies realize they’re not yet really market and

customer driven—they are product and sales driven.
• Transforming into a true market-driven company requires:

i. Developing a company-wide passion for customers
ii. Organizing around customer segments instead of products
iii. Understanding customers through qualitative and quantitative
research
• Although it’s necessary to be customer oriented, it’s not

enough.
• The organization must also be creative.
• Companies today copy each others’ advantages and

strategies with increasing speed, making differentiation
harder to achieve and lowering margins as firms become
more alike.
• The only answer is to build a capability in strategic innovation

and imagination.
• This capability comes from assembling tools, processes, skills,

and measures that let the firm generate more and better new
ideas than its competitors.
• Companies must watch trends and be ready to capitalize on

them.
Socially Responsible Marketing
• Effective internal marketing must be matched by a strong

sense of ethics, values, and social responsibility.
• A number of forces are driving companies to practice a higher

level of corporate social responsibility:
i. Rising customer expectations
ii. Changing employee expectations
iii. Government legislation and pressure
iv. Investor interest in social criteria
v. Changing business procurement practices
Environmental Sustainability
Palm oil producer Wilmar launched its first Sustainability Report in 2010, marking its journey toward
transparency and accountability.
• Virtually all firms have decided to take a more active,

strategic role in corporate social responsibility, carefully
scrutinizing what they believe in and how they should treat
their customers, employees, competitors, community, and the
environment.
• Many now believe that satisfying customers, employees, and

other stakeholders and achieving business success are closely
tied to the adoption and implementation of high standards of
business and marketing conduct.
• A further benefit of being seen as socially responsible is the

ability to attract employees, especially younger people who
want to work for companies they feel good about.
• The most admired—and most successful—companies in the

world abide by a code of serving people’s interests, not only
their own.
Corporate Social Responsibility
Raising the level of socially responsible marketing calls for a

three-pronged attack that relies on proper legal, ethical, and
social responsibility behavior.
Legal Behavior
• Organizations must ensure every employee knows and

observes relevant laws.
• Society must use the law to define those practices that are
illegal, antisocial, or anti-competitive.
Ethical Behavior
• Business practices come under attack because business

situations routinely pose ethical dilemmas: It’s not easy to
draw a clear line between normal marketing practice and
unethical behavior.
• Of course certain business practices are clearly unethical or

illegal. These include bribery, theft of trade secrets, false and
deceptive advertising, exclusive dealing and tying
agreements, quality or safety defects, false warranties,
inaccurate labeling, price-fixing or undue discrimination, and
barriers to entry and predatory competition.
Ethical Behavior—Tobacco sponsorship
An ethical dilemma—Should tobacco companies be allowed to sponsor schools especially those in

rural areas and in need of support?
Social Responsibility Behavior
• Individual marketers must exercise their social conscience in

specific dealings with customers and stakeholders.
• Increasingly, people say that they want information about a

company’s record on social and environmental responsibility
to help decide which companies to buy from, invest in, and
work for.
• Communicating corporate social responsibility can be a

challenge. Once a firm touts an environmental initiative, it
can become a target for criticism.
Social Responsibility Behavior—Banyan Tree
Banyan Tree & Resorts is a leader in sustainability programs. It engages in preserving animal species
that are endangered, providing employment to local artisans, as well as reducing solid waste in its
resorts.
Social Responsibility Behavior
• Often, the more committed a company is to sustainability and

environmental protection, the more dilemmas that can arise.
• Corporate philanthropy can also pose dilemmas.
• Although companies may donate to charities, such good deeds can

be overlooked—even resented—if the company is seen as
exploitative or fails to live up to a “good guys” image.
• Some critics worry that cause marketing or “consumption

philanthropy” may replace virtuous actions with less thoughtful
buying, reduce emphasis on real solutions, or deflect attention from
the fact that markets may create many social problems to begin
with.
Many well-intentioned product or marketing
initiatives can have unforeseen or unavoidable
negative consequences.
In Indonesia, Greenpeace activists’ dramatic protests drew attention to the environmental effects of
Nestlé’s manufacturing of products such as KitKat candy bars.
Ethical Behavior
Companies must adopt and disseminate a written code of ethics,

build a company tradition of ethical behavior, and hold its people
fully responsible for observing ethical and legal guidelines.
Sustainability
• Sustainability, the ability to meet humanity’s needs without

harming future generations, now tops many corporate
agendas.
• Major corporations outline in great detail how they are trying

to improve the long-term impact of their actions on
communities and the environment.
• Sustainability ratings exist, if not consistent agreement about

what metrics are appropriate.
Sustainability
Taipei 101 was honored with a

green award. The skyscraper
uses rainwater to water plants
and recycles over 60 percent of
waste.
Sustainability
• Some feel companies that score well on sustainability

typically exhibit high-quality management in that “they tend
to be more strategically nimble and better equipped to
compete in the complex, high-velocity, global environment.”
• Heightened interest in sustainability has also unfortunately

resulted in greenwashing, which gives products the
appearance of being environmentally friendly without living
up to that promise.
Socially Responsible Business Models
• The future holds a wealth of opportunities, yet forces in the

socioeconomic, cultural, and natural environments will impose
new limits on marketing and business practices.
• Companies that innovate solutions and values in a socially

responsible way are most likely to succeed.
Socially Responsible Business Models
• Corporate philanthropy as a whole is on the rise. More firms

are coming to the belief that corporate social responsibility in
the form of cash donations, in-kind contributions, cause
marketing, and employee volunteerism programs is the not
just the “right thing” but also the “smart thing to do.”
Social Responsibility by Tata
Tata takes social responsibility seriously. Its social services programs include paying for water
supplies and subsidizing hospital bills and school fees.
Cause-related Marketing
• Many firms blend corporate social responsibility initiatives

with their marketing activities.
• Cause-related marketing is marketing that links the firm’s

contributions to a designated cause to customers’ engaging
directly or indirectly in revenue-producing transactions with
the firm.
• Cause related marketing has also been called a part of

corporate societal marketing (CSM).
Cause-related Marketing—LVMH
In Singapore, LVMH supports the School of the Arts by sponsoring artistic seminars and workshops.
Cause Marketing Benefits and Costs
• A successful cause-marketing program can improve social

welfare; create differentiated brand positioning; build strong
consumer bonds; enhance the company’s public image;
create a reservoir of goodwill; boost internal morale and
galvanize employees; drive sales; and increase the firm’s
market value.
• Consumers may develop a strong, unique bond with the firm

that transcends normal marketplace transactions.
Cause Marketing—Benefits
Specifically, from a branding point of view, cause marketing

can:
i. Build brand awareness
ii. Enhance brand image
iii. Establish brand credibility
iv. Evoke brand feelings
v. Creating a sense of brand community
vi. Elicit brand engagement
LG Electronics
LG matches the contributions from their employees toward a social fund that supports various
causes.
Cause Marketing—Costs
• Cause-related marketing programs could backfire if cynical

consumers question the link between the product and the
cause and see the firm as being self-serving and exploitative.
• Problems can also arise if consumers do not think a company

is consistent and sufficiently responsible in all its behavior.
Cause Marketing : Nike and Lance Armstrong
Nike’s alliance with the Lance Armstrong Foundation for cancer research has sold over 80 million
yellow LIVESTRONG bracelets for $1, but deliberately, the famed Nike swoosh logo is nowhere to be
seen.
Cause Marketing—Implications
• The knowledge, skills, and resources of a top firm may be

even more important to a nonprofit or community group than
funding.
• Developing a long-term relationship with a firm can take a

long time.
Cause Marketing—Implications
• Nonprofits must be clear about what their goals are,

communicate clearly what they hope to accomplish, and
devise an organizational structure to work with different
firms.
• A number of decisions must be made in designing and

implementing a cause marketing program, such as how many
and which cause(s) to choose, and how to brand the cause
program.
Designing a Cause Program
• Some experts believe that the positive impact on a brand

from cause-related marketing may be lessened by sporadic
involvement with numerous causes.
• Many companies choose to focus on one or a few main causes

to simplify execution and maximize impact.
• Limiting support to a single cause may limit the pool of

consumers or other stakeholders who could transfer positive
feelings from the cause to the firm.
Designing a Cause Program
• Opportunities may be greater with “orphan causes”—diseases

that afflict fewer than 200,000 people.
• Most firms tend to choose causes that fit their corporate or

brand image and matter to their employees and shareholders.
Cause Marketing : Japan Tsunami
The Japanese tsunami saw companies, both Japanese and non-Japanese, large and small, coming
forward to help, including Apple. It kept its stores open to provide Wi-Fi access.
Marketing Memo: Making a Difference—Top 10 Tips
for Cause Branding
Lists the 8 ways Boston’s Cone, Inc. feels that cause marketing
should best be practiced:
1. define CSR for your company;

2. build a diverse team;
3. analyze your current CSR-related activities and revamp them if
necessary;
4. forge and strengthen NGO relationships;
5. develop a cause-branding initiative;
6. walk your talk;
7. don’t be silent;
8. beware …
Social Marketing
• Cause-related marketing supports a cause.
• Social marketing is done by a nonprofit or government organization

to further a cause.
• Social marketing is a global phenomenon that goes back many

years.
• Different types of organizations conduct social marketing in Asian

countries.
• Literally hundreds of nonprofit organizations are involved with social

marketing.
Social Marketing
Social marketing is prevalent in Singapore. Campaigns such as racial harmony is one of many that
Singaporeans grew up with. The lion mascots remind Singaporeans to respect the different racial
groups.
Social Marketing
• Choosing the right goal or objective for a social marketing

program is critical.
• Social marketing campaigns may have objectives related to

changing people’s cognitions, values, actions, or behaviors.
i. Cognitive campaigns
ii. Action campaigns
iii. Behavioral campaigns
iv. Value campaigns
Examples of Social Marketing Objectives
• Cognitive Campaigns
– Explain the nutritional value of different foods
– Explain the importance of conservation
• Action Campaigns
– Attract people for mass immunization
– Motivate people to vote “yes” on a certain issue
– Motivate people to donate blood
– Motivate women to take a Pap test
Examples of Social Marketing Objectives
• Behavioral Campaigns
– Demotivate cigarette smoking
– Demotivate hard drug usage
– Demotivate excessive consumption of alcohol
• Value Campaigns
– Alter ideas about abortion
– Change attitudes toward getting married and having children
Social Marketing Planning
• The social marketing planning process follows many of the

same steps as for traditional products and services (see Table
22.2).
• These are some key success factors in developing and

implementing a social marketing program:
– Study the literature and previous campaigns.
– Choose target markets that are most ready to respond.
– Promote a single, doable behavior in clear, simple terms.
– Explain the benefits in compelling terms. Make it easy to adopt
the behavior.
– Develop attention-grabbing messages and media.
– Consider an education-entertainment approach.
Table 22.2: Social Marketing Planning Process
84
Social Marketing Programs
• The social marketing planning process follows many of the

same steps as for traditional products and services.
• Social marketing programs are complex; they take time and

may require phased programs or actions.
• Social marketing organizations should evaluate program

success in terms of their objectives:
i. High incidence of adoption
ii. High speed of adoption
iii. High continuance of adoption
iv. Low cost per unit of adoption
v. No major counterproductive consequences
Marketing Implementation and Control
• Table 22.3 summarizes the characteristics of a great marketing

company.
• A marketing company is great not by “what it is,” but by “what it

does.”
• Great marketing companies know the best marketers thoughtfully

and creatively devise marketing plans and then bring them to life.
• Marketing implementation and control are critical to making sure

marketing plans have their intended results year after year.
Table 22.3: Characteristics of a Great Marketing Company
Marketing Implementation
• Marketing implementation is the process that turns marketing

plans into action assignments and ensures that such
assignments are executed in a manner that accomplishes the
plan’s stated objectives.
• A brilliant strategic marketing plan counts for little if it is not

implemented properly.
• Strategy addresses the what and why of marketing

activities.
• Implementation addresses the who, where, when, and

how.
• Companies today are striving to make their marketing

operations more efficient and their return on marketing
investment more measurable.
• Marketing costs can amount to as much as a quarter of a

company’s total operating budget. Marketers need better
templates for marketing processes, better management of
marketing assets, and better allocation of marketing
resources.
• Marketing resource management (MRM) software provides a

set of Web-based applications that automate and integrate
project management, campaign management, budget
management, asset management, brand management,
customer relationship management, and knowledge
management.
• The knowledge management component consists of process

templates, how-to wizards, and best practices.
• Software packages can provide what some have called

desktop marketing, giving marketers information and decision
structures on computer dashboards.
• MRM software lets marketers improve spending and

investment decisions, bring new products to market more
quickly, and reduce decision time and costs.
Marketing Control
• Marketing control is the process by which firms assess the

effects of their marketing activities and programs and make
necessary changes and adjustments.
i. Annual-plan control
ii. Profitability control
iii. Efficiency control
iv. Strategic control
Table 22.4: Types of Marketing Control
Annual-plan Control
• Annual-plan control aims to ensure that the company

achieves the sales, profits, and other goals established in its
annual plan.
• The heart of annual-plan control is management by

objectives.
Annual-plan Control
• Four steps are involved (see Figure 22.4):
i. Management sets monthly or quarterly goals.
ii. Management monitors its performance in the marketplace.
iii. Management determines the causes of serious performance

deviations.
iv. Management takes corrective action to close the gaps between

goals and performance.
• This control model applies to all levels of the organization.

Figure 22.4: The Control Process
Marketing Metrics
• Marketers today have better marketing metrics for measuring

the performance of marketing plans.
• See Table 22.5 for some samples.
• They can use four tools to check on plan performance: sales

analysis, market share analysis, marketing expense-to-sales
analysis, and financial analysis.
• The chapter appendix outlines them in detail.
Table 22.5: Marketing Metrics
Profitability Control
• Companies should measure the profitability of their products,

territories, customer groups, segments, trade channels, and
order sizes to help determine whether to expand, reduce, or
eliminate any products or marketing activities.
• The chapter appendix shows how to conduct and interpret a

marketing profitability analysis.
Efficiency Control
• Some companies are establishing a position of marketing

controller to specialize in improving marketing efficiency.
• Marketing controllers examine adherence to profit plans, help

prepare brand managers’ budgets, measure the efficiency of
promotions, analyze media production costs, evaluate
customer and geographic profitability, and educate marketing
personnel on the financial implications of marketing decisions.
• They can examine the efficiency of the channel, sales force,

advertising, or any other form of marketing communication.
Strategic Control
• Each company should periodically reassess its strategic

approach to the marketplace with a good marketing audit.
• Companies can also perform marketing excellence reviews

and ethical/social responsibility reviews.
The Marketing Audit
• Many companies often lose half of its customers in five years, half of its
employees in four years, and half of its investors in less than one year.
• Clearly, this points to some weaknesses. Companies that discover

weaknesses should undertake a thorough study known as a marketing
audit.
• A marketing audit is a comprehensive, systematic, independent, and

periodic examination of a company’s or business unit’s marketing
environment, objectives, strategies, and activities with a view to
determining problem areas and opportunities and recommending a plan of
action to improve the company’s marketing performance.
Characteristics of a Marketing Audit
1. Comprehensive—The marketing audit covers all the major

marketing activities of a business, not just a few trouble
spots. It would be called a functional audit if it covered only
the sales force, pricing, or some other marketing activity.
Although functional audits are useful, they sometimes
mislead management. For example, excessive sales-force
turnover could be a symptom not of poor sales-force training
or compensation but of weak company products and
promotion. A comprehensive marketing audit usually is more
effective in locating the real source of problems.
2. Systematic—The marketing audit is an orderly examination

of the organization’s macro- and micromarketing
environments, marketing objectives and strategies,
marketing systems, and specific activities. The audit
indicates the most-needed improvements, which are then
incorporated into a corrective action plan involving both
short-run and long-run steps to improve overall
effectiveness.
3. Independent—A marketing audit can be conducted in six

ways: self-audit, audit from across, audit from above,
company auditing office, company taskforce audit, and
outsider audit. Self-audits, in which managers use a checklist
to rate their own operations, lack objectivity and
independence. However, the best audits generally come from
outside consultants who have the necessary objectivity,
broad experience in multiple industries, some familiarity with
the industry being audited, and the undivided time and
attention to give to the audit.
4. Periodic—Typically, marketing audits are initiated only after

sales have turned down, sales-force morale has fallen, and
other problems have occurred. Companies are thrown into a
crisis partly because they failed to review their marketing
operations during good times. A periodic marketing audit can
benefit companies in good health as well as those in trouble.
Table 22.6: Components of a Marketing Audit
(Part 1)
(Part 2)
(Part 3)
(Part 4)
(Part 5 )
(Part 6)
(Part 7)
The Marketing Excellence Review
• Management can place a checkmark to indicate its perception

of where its business stands.
• The profile management creates from indicating where it

thinks the business stands on each line can highlight where
changes could help the firm become a truly outstanding
player in the marketplace.
Table 22.7: The Marketing Excellence Review: Best
Practice
The Future of Marketing
• Top management has recognized that past marketing has

been highly wasteful and is demanding more accountability
from marketing departments.
• “Marketing Memo: Major Marketing Weaknesses” summarizes

the major deficiencies that companies have in marketing, how
to spot these deficiencies, and what to do about them (The
Deadly Sins).
Marketing Memo: Major Marketing Weaknesses
Marketing Memo: Major Marketing Weaknesses
• To succeed in the future, marketing must be more holistic and

less departmental.
• Marketers must achieve larger influence in the company,

continuously create new ideas, and strive for customer insight
by treating customers differently but appropriately.
• They must build their brands more through performance than

promotion.
• They must go electronic and win through building superior

information and communication systems.
The coming years will see:
1. The demise of the marketing department and the rise of holistic

marketing.
2. The demise of free-spending marketing and the rise of ROI
marketing.
3. The demise of marketing intuition and the rise of marketing
science.
4. The demise of manual marketing and the rise of both
automated and creative marketing.
5. The demise of mass marketing and the rise of precision
marketing.
To accomplish these changes and become truly holistic,

marketers need a new set of skills and competencies in:
1. Customer relationship management (CRM)

2. Partner relationship management (PRM)
3. Database marketing and data-mining
4. Contact center management and telemarketing
5. Public relations marketing (including event and sponsorship
marketing)
6. Brand-building and brand-asset management
7. Experiential marketing
8. Integrated marketing communications
9. Profitability analysis by segment, customer, and channel
Schema for Chapter Twenty Two
Schema for Chapter Twenty Two
Thank you

Mma6e Chapter 22

Uploaded by

Document Information

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Mma6e Chapter 22

Uploaded by

Copyright:

Available Formats

Marketing Management:

1. What are important trends in marketing practices?

2. What are the keys to effective internal marketing?

3. How can companies be responsible social marketers?

4. How can a company improve its marketing skills?

5. What tools are available to help companies monitor and

• Healthy long-term growth for a brand requires that the

• Holistic marketers must engage in a host of carefully planned,

• They must also consider a wider range of effects of their

• Corporate social responsibility and sustainability have become

• Successful holistic marketing requires effective relationship

• Chapters 1 and 3 described some important changes in the

• In response to this rapidly changing environment, companies

• Recently, marketers have had to operate in a slow-growth economic

• As consumers become more disciplined in their spending and adopt

• Emerging markets such as India and China offer enormous new

• Across all markets, marketing plans and programs will grow

• Businesses will continue to use social media more and

• Marketers also face ethical dilemmas and perplexing

• Given increasing consumer sensitivity and government

• Now more than ever, marketers must think holistically and

• They must develop fully integrated marketing programs and

• The role of marketing in the organization is changing.

• Traditionally, marketers have played the role of middlemen.

• In a networked enterprise every functional area can interact directly with

• Marketing in a networked enterprise must integrate all the customer-facing

• A company can have an excellent marketing department, yet fail at

• Many companies are now focusing on key processes rather than

• To achieve customer-related outcomes, companies appoint process leaders

Modern marketing departments may be organized in a number

• In the most common form of marketing organization consists

• Additional specialists might include:

• The main advantage of a functional marketing organization is

• However, it can be quite a challenge to develop smooth

• This form can also lose its effectiveness as products and

• A functional organization often leads to inadequate planning

• Then, each functional group competes with others for budget

• A company selling in a national market often organizes its sales

• Some companies are now adding area-marketing specialists

• Improved information and marketing research technologies have

• Some companies have to develop different marketing programs in

• Companies producing a variety of products and brands often

• The product-management organization does not replace the

• A product-management organization makes sense if the company’s

• Product and brand management is sometimes characterized as a

• Developing a long-range and competitive strategy for the product

• Preparing an annual marketing plan and sales forecast

• Working with advertising and merchandising agencies

• Increasing support of the product among the sales force and

• Gathering continuous intelligence on the product’s performance,

• Initiating product improvements to meet changing market needs

1. Product and brand managers may lack authority to carry out

2. Product and brand managers become experts in their product

3. The product management system often turns out to be

4. Brand managers normally manage a brand for only a short

5. The fragmentation of markets makes it harder to develop a

6. Product and brand managers cause the company to focus on

• A second alternative in a product-

• The triangular and horizontal

• The company consists of several

• This is quite different from the

• A third alternative for product management organization is to

• A fourth alternative is to introduce category management

• A rationale for category management is the increasing power