Transcript Marketing in the Contemporary Organization

MKT 420
Contemporary Issues in
Marketing
Chapter 1
Marketing in the Contemporary
Organization
Objective
Review current debates about the
nature of the marketing role in
contemporary organizations
 Provide a background context for the
specific topics that will be discussed in
future chapters.
 List topics that currently impact the
way marketing is researched and
practiced
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Definitions of Marketing: Critique/Analysis
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Marketing as a phenomenon has changed significantly
over the last several years.
New fields of study have emerged such as relationship
marketing, services marketing and the network
perspective on business-to-business marketing.
Attempts have been made to redefine both the
terminology and the environment of marketing.
Scholars are concerned about the direction in which
marketing conceptualizations are moving (Wilkie, 2005;
Gronroos, 2006).
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Definitions of Marketing: Critique/Analysis
Continued………….
 Several
issues raised for the definition of
Marketing by AMA (2004):
“Marketing is an organizational function and a
set of business processes for creating,
communicating, and delivering value to
customers and for managing customer
relationships in ways that benefit the
organization and its stakeholders.”
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Definitions of Marketing: Critique/Analysis
Continued………….
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Major concerns were related to its conception of the role
of marketing within the organization, the role of
consumers within the marketing relation and the wider
societal role of marketing.
Definition was considered to view marketing as one
function amongst others, and that such a conception of
marketing is ill equipped to deal with new forms of
relationships with customers. (Gronroos, 2006)
Consumers are defined to have value delivered to them
although this is becomes a social problem as all
marketers simply propose too much consumption for
each consumer. (Wilkie, 2005, p. 8).
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Definitions of Marketing: Critique/Analysis
Continued………….
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Marketing system is structured as if finance is not
important for the consumer.
Delivery of value to customers also ignores their role in
actively producing value (Vargo and Lusch, 2004).
Value is considered to emerge both in interactions
between the consumer and supplier, and also through
a series of subsequent consumption practices by
consumers.
AMA (2004) definition only captures the role of the
marketing manager, and ignores the wider role of
marketing within society.
The definition of marketing that embraces a macromarketing perspective where marketers engage with
the ‘big issues’ in society.
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Definitions of Marketing: Critique/Analysis
Continued………….
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Due to debate generated by earlier 2004
definition of marketing, the AMA produced a
second updated version in 2007, as below:
“Marketing is the activity, set of institutions, and
processes for creating, communicating, delivering,
and exchanging offerings that have value for
customers, clients, partners, and society at large."
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Future of Marketing’s role in the Organization
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In a survey of 30 large US companies more
than 30 per cent indicated that they spend
less than 10 per cent of their time discussing
marketing or customer related issues at
board level. (McGovern et al., 2004)
Following the closure of corporate marketing
departments, companies have plugged the
gap by creating the position of Chief
Marketing Officer (CMO).
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Future of Marketing’s role in the Organization
Continued…….
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Concerns about the high turnover of these
positions because: Position is often ill-defined,
little formal authority, corporate expectations are
frequently unrealistic
Tension between CMOs and other board
members due to the creative approach taken by
successful marketers, which is at odds with the
more structured and disciplined approach
required in other parts of the organization.
The difficulties in measuring marketing outcomes
mean that marketers struggle to demonstrate
returns on organizational investments in
marketing programs.
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Future of Marketing’s role in the Organization
Continued…….
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Key marketing functions are dispersed
throughout the organization. Today, marketing
in many large companies is less of a
department and more a diaspora of skills and
capabilities spread across and even outside the
organization.
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What do Consumers think of Marketing?
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Main purpose of marketing is to serve customers, so
their views about marketing need attention.
Survey by Yankelovich (cited in Sheth and Sisodia,
2006) says that 60% respondents had negative views
about advertising and marketing activities.
Gaski and Etzel (2005) observed that out of four
marketing activities, product quality carries more
importance in influencing customers, followed by
price, retail service and advertising.
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What do Consumers think of Marketing?
Continued…….
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Customers are positive about creativity, fun,
humorous advertising and attractive people
On the negative side consumers feel marketers are
lying, deception, deceitful, annoying, manipulating,
gimmicking, exaggerating, invading, intruding and
brainwashing.
In terms of marketing practices telemarketing,
online pop-up advertisements and junk mail were
viewed most negatively.
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Doing Marketing in a Different Way…
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Fill the Scholarship-Practitioner gap in marketing:
Scholars should broaden their conception of practitioner
audience, to embrace not only marketing but Strategic
Management, Operations, Supply Chain, HR, Finance
etc. The concept of ‘customer focus’ and ‘competing
through service’ should be adapted by all business
functions.
Fruitful partnership between academics and
business leaders: Business leaders should reflect on the
role of marketing in their organizations. They can give
insights of challenges they face, and ways in which
marketing is affecting their businesses.
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Doing Marketing in a different way?
Continued…….
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Create systems to bring the customer closer:
Systems to create mutual value, rather than directing
the creation of value by consumer alone. Internet has
resulted in ‘do it yourself’ form of marketing where
middlemen are eliminated. E.g. eBay, online
marketing, e-payment etc.
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