Applied

Marketing
Session 6:
Coordinating,
Applying and
Measuring
the Marketing
Mix
Developing the Marketing Mix

We have learnt that the marketing mix forms the tools of the marketer. They are the
tactical elements that marketers combine in order to achieve their marketing
objectives and marketing strategies. As we saw in the marketing planning process
and with objective setting this starts with the organisational objectives. What the
organisation is trying to achieve will set the marketing objectives, which will
determine the marketing strategy which in turn will determine the target market.
Unless all the stages are in place it is impossible to determine the most effective
marketing mix.

Co-ordinating the Marketing Mix

Premium brand ‘Sunseeker’:

• Product quality (Product)
• Premium pricing (Price)
• Exclusive distribution (Place)
• Communications with strong brand imagery (Promotion)
• People skilled and trained in product (People)
Marketing in Different Contexts
Key differences can be the
number of customers, the
complexity of the purchasing
process, the differences in
objectives and the availability
of resources. For example, a
small to medium sized
enterprise will have limited resources, and this may mean they focus on a smaller
portfolio of products/services (or even just one), have limited distribution channels,
and choose promotional tools that are less expensive e.g. social media.

Trading across borders can bring its own challenges, and marketers need to
understand many different environmental issues that will come into play with
international marketing such as cultural, educational and media availability issues.

These should be considered in the decision of whether to standardise the marketing

mix regardless of country, or adapt the approach in different markets. For example,
despite McDonalds consistent branding across the world, it adapts the marketing mix
to each country e.g. offering menus specific to the tastes within the market.

Marketing in Different Contexts – B2C – John Lewis

Consumers are generally happy to
purchase through intermediaries,
and this is reflected here as John
Lewis are a retailer that sell the
goods of many other brands.
Consumers also tend to switch
between brands, and John Lewis
have recognised this and used ‘promotion’ to incorporate a loyalty scheme aimed at
retaining customers, which also makes the ‘process’ of making payment and
returning goods much more efficient for customers.
Marketing in Different Contexts – B2B – Adobe

Marketing in Different Contexts – NFP – Oxfam

Relationship Building

Marketing
Tactics
 Strategic Fit

Organisations should strive to

achieve strategic fit between its
strategies, its organisational
operations and the marketing
environment. Ideally marketing strategies and tactics should reflect the environment
even if this means a fundamental reorganisation of operations.

Adapting to Changes in the Macro Environment

Environmental Change : Waitrose

Waitrose are adapting to environmental change across the marketing mix. Changes
to the marketing mix range from the reduction of unnecessary plastics across their
product to changes to the process of shopping by giving customers opportunity in
selected stores to bring their own containers to refill with items such as meat, frozen
fruit and pasta. Promotion to customers focuses on how to shop, store and cook
foods to limit food waste. Beyond customer homes, Waitrose are also focusing on
reducing food waste in all places; in stores, throughout their supply chain and across
deliveries.

The online shopping experience also continues to adapt to environmental change

with a growing electric fleet of vehicles (place and physical evidence) and
deliveries arriving in crates to be unpacked in customers home to limit the use of
plastic bags (process).

Adapting the Mix Internationally

One of the biggest challenges for marketers in the international arena is the decision
to standardise the marketing mix across borders or adapt it in some way i.e. think
global act local. A standardised approach uses the same product and advertising
message for all countries so assumes that customer needs and perceptions are very
similar everywhere. Coca Cola gets very close to this approach.
Adjusting the message and product to local conditions, i.e. adaptation, where the
product or message is changed to more directly appeal to the needs, values and
perceptions of the local market may be a more appropriate approach. This helps to
overcome some of the challenges of international marketing.
Difficulties in creating a fully standardised marketing mix:
• Culture and consumption patterns
• Language differences
• Regulations
• Media availability and promotional preferences
• Organisational structure and culture

Metrics and Key Performance Indicators

Metrics are “a quantitative measurement of statistics describing events or trends.”

(Kaushik, 2010).

Key Performance Indicators are “metrics used to assess the performance of a

process and/or whether goals are achieved” (Kaushik, 2010).

Measurement of the Marketing Mix

Product:
• Market share is percentage of the industry or market's total sales (in volume of
value) that is generated by a particular company. If the percentage share the
organisation holds at the beginning of the year is known, growth can be measured.
• Sales is total sales revenue of the company (this can be looked at by
product/service).
• Number of new products launched per year as a measure of innovation/new
product development. Particularly useful measurement if the organisation is trying to
innovate faster than the competition.
• Repeat purchases a purchase from a customer of a same brand
product as brought on a previous occasion.
Price:
• Margin is the amount of profit generated from a sale. This is a relevant
measurement in a b2b context where there is no fixed price and negotiation so
margin can fluctuate.
• Discount levels refers to discounts given to customers – this is useful for
monitoring where sales people have given discounts for larger sales.
• Comparisons with competitors, for example, are relevant as price helps to guide
positioning and competitor pricing can impact future pricing decisions too.

Place:
• Costs associated with using one channel compared to another which will impact
overall profitability. Which channels have highest costs – branded retailer for
example versus ecommerce.
• Volume is a measurement of sales achieved through each channel as an indication
of the most successful channels.
• Growth is a measurement of the growth in sales through the channel.
• Stock levels is a measurement of stock held by the channel – if doesn’t maintain
sufficient stock this can impact customer satisfaction and the brand.
• Online availability measures how widespread the product/service is available
online.
Promotion:
• Media coverage a measurement of the impact of Public Relations
• Cost per contact compares the cost of the promotional activity per contact that it
reaches. So TV advertising is expensive but is seen by thousands more than advert
so has a lower cost per contact.
• Sales/calls ratios is a common measurement for personal selling and looks at the
volume and value of sales achieved and measures this against calls/appointments
made.
• Enquiries generated measures the number of enquiries generated from a
promotion e.g. number of website registrations, number of incoming phone calls etc.
• Awareness levels refers to customer’s ability to recall a particular organisation,
brand or product for example which requires research to be carried out with
customers. From a digital perspective this can be measured by brand sentiment
which is discussed later.
• Click through rate (CTR) the number of people that clicked through on a link in an
email for example, or on a digital display advert.
• Bounce rate here is a measurement used for email marketing, referring to emails
that were not delivered and therefore, ‘bounced’. This is different to a website
bounce rate that is defined on the next slide. Email bounce rate indicates the quality
of the data that was mailed, so a high bounce rate can indicate poor quality or old
data.
• Engagement measures the level of engagement that a piece of social media
content is receiving, for example, this can include user comments, shares and likes.

Measurement of the Extended Marketing Mix

People
Service quality satisfaction refers to the level of satisfaction that a customer has
with the service. This can be measured by survey for example.
Traffic online help measures the number of customers using online help facilities to
highlight the usage levels.
First call resolution measures how many issues reported to a call centre/location
help team are resolved on the first call without the customer having to follow up.
Number of complaints measures the number of complaints reported as an indicator
of customer satisfaction and experience.
Increased sales to existing customers measures sales to existing customers over
a period as an indication of effectiveness of service.

Process

Queuing times are measured to monitor the length of time customers spend
queuing during specific stages of their customer journey e.g. queuing times on a call
centre line.
Number of orders and % of perfect orders measure how many orders are fulfilled,
and highlights how many of these are fulfilled without any errors as a decrease in
perfect orders would illustrate an issue with the process to be resolved.
Number of complaints is defined above – an increase in number of complaints may
signify issues with specific areas of the process.

Physical Evidence

Number of reviews generated measures the number of reviews generated from

customers in a given period.
Website traffic and app downloads can be used as measures of the user
experience offered by the company.
Bounce rate is the percentage of website visitors who see just one page on a site.
The percentage of website visitors who stay on a site for a small amount of time
(usually five seconds or less). This can indicate the customers interest (or not) in the
content and experience offered on a company’s website.
Measuring Profitability

 Revenue (turnover) – leading performance indicators as indicates what has

been sold in total; however, does not take into account costs.

 Gross profit – measures total revenue minus costs incurred in producing

products, can be expressed as a percentage.

 Net profit – measures total revenue minus total costs (administrative costs,
interest payments, selling costs, taxes etc.).

 Operating profit/return on sales – measures an organisation’s ability to

generate profit from sales: ROS = Net profit / sales revenue

Return on Marketing Investment

Net Promoter Score (NPS)

 A Net Promoter Score® is a measure of

customer loyalty based on a single question –
how likely the buyer would be to recommend the
organisation to a friend or colleague.

 NPS asks the customer to draw on their total experiences, making it a good
indicator for repurchasing and growth.

Customer Satisfaction Score (CSAT)

 CSAT is the average satisfaction score by which customers rate a specific

experience they had with an organisation.
  It’s measured by asking customers (via a short survey) to rate their level of
satisfaction with the interaction on a scale of “Not satisfied at all” to “Very
satisfied.”

Customer Lifetime Value (CLV)

Metrics for Digital Marketing Activities

Sentiment Analysis

Sentiment analysis looks at comments and suggestions left on social media sites
such as blogs and social networks.

Marketing Dashboard
The Marketing Dashboard should be focused on presenting Key Performance
Indicators visually.

Test Your Knowledge

You are devising the marketing mix for a new chocolate bar. Why is it important to ensure that all
the elements of your chosen mix integrate well together?

1. To ensure a coherent image

2. To ensure that the price matches your competitors

3. To ensure that the offering is competitive

4. To ensure that the product is correctly positioned

5. To ensure that it appears in as many retail outlets as possible

1. 2, 4 and 5 only

2. 3, 4 and 5 only

3. 1, 3 and 4 only

4. 2, 3 and 5 only

Your organisation offers a range of confectionery. As a result of lobbying by health

groups, the government is introducing new legislation to reduce the amount of sugar
your products are allowed to contain. The bill that has been passed is likely to
become law next year. You have been asked to assess the likely impact of this on
your current marketing strategy and mix. Which of the following would you have to
consider making changes to?

1. The formulation of your products

2. The price of your products

3. The labelling and packaging of your products

4. The outlets that sell your product

5. The media that you use for promotion

6. The messages used in your promotions

a) 2, 4 and 6 only b) 1,3and6only c) 1, 3 and 5 only d)

b)

c)

d) 3, 5 and 6 only