Consumer Content
What makes the existence of any organization possible is that there are a significant num-
ber of people who need the product or service offered by that organization. As soon as that
group becomes too small, or the need no longer exists, or some other organization can sat-
isfy that need better, the organization will be eliminated. That is the way of a free economy.
Thus , a politician doesn't get re-elected, an inner-city church closes its doors, the money
needed to cure AIDS is not allocated, and the Vail Ski Resort files for bankruptcy.
In the case of business organizations, and marketing organization:.: in partic ular, the
people with the needs are called consumers or customers. In marketing, the act of obtaining a desired object from someone by offering something of value in return is called the
exchange process. Moreover, the exchange between the person with the need (who gives
money or some other personal resource) and the organization selling this need-satisfying
thing (a product, service, or idea) is inherently economic, and is called a transaction . There tends to be some negotiation between the parties. Individuals on both sides attempt to maximize rewards and minimize costs in their transactions so as to obtain the :'nost profitable
outcomes. Ideally, all parties achieve a satisfacto ry level of reward.
In each transaction, there is an underl ying philosophy in respect to how the parties
perceive the exchange. Sometimes deception and lying permeate the exchange. Other
exchanges may be characteri zed as equitable, where each party receives about the same as
the other-the customer's need is satisfied and the business makes a reasonable profit. With
the emergence of the Internet and e-comrnerce during the 1990s, the nature of the exchange
for many businesses and customers has changed dramaticall y. Today's consumers have access
to far more and far better information . They also have many more choices. Businesses must
provide a similar level of information and must deal with new competitors that are qu icker,
smarter, and open 24 hours a day.
An organization that employs marketing correctly knows that keeping customers
informed is easier if they keep in constant contact with the customer. This does not neces-
sarily mean that they write and call regularly, although it could. Rather, it more likely means
that a marketing organization knows a great deal about the characteristics, values, interests, and behaviors of its customers, and monitors how these factors change over time.
Although the process is not an exact science, there is sufficient evidence that marketers who
do this well tend to succeed.
When
attempt to know as much about the consumer as possible is coupled with
a decision to base all marketing on this information, it is said that the organization is consumer-oriented or has adopted the marketing concept. It means working back from the customers'
needs, rather than forward from the factory 's capabilities.
Both historically and currently, man y businesses do not
the marketing con-
cept. Companies such as Texas Instruments and Otis Elevator followed what has been labeled
a production orientation, where the focus is on technology, innovation, and low produc-
tion costs. Such companies assume that a technically superior or less expensive product
sells itself. There are also companies, such as Amway, where sales and marketing are essen-
tiall y the same thing. This sales orientation assumes that a good salesperson has the capability to sell anything. Often, this focu s on the selling process may ignore the consumer Of
view the consumer as someone to be manipulated. Insightful businesses acknowledge the
importance of production and sales, but realize that a three-step process is most effective:
(1) con tinuously collect information about customers' needs and competitors' capabilities;
(2) share the information across departments; and (3) use the information to create a com-
petitive advantage by increasing value for customers. This is true marketing.
MARKETING: DEFINITION AND JUSTIFICATION
9
Company Capabilities
All marketing organizations try to objectively compare their existing capabilities with their
ability to meet the consumer's needs now and in the future. Moreover, when deficiencies
are found, a good marketing organization must be willing to make changes as quickly as
possible. When Toyota realized that their products were not connecting with consumers aged
35 and younger, it decided to take direct action. In 1999, it gathered eight people in their
20s and 30s from around the company into a new, ethnically diverse marketing group called
"genesis." Their first assignment was to launch three cars meant to pull in younger buyers: the entry-level ECHO subcompact, a sporty new two-door Celica, and the MR2 Spyder, a
racy convertible roadster. 2
Although assessing company capabilities often begins in the marketing area, all the
business functions must be assessed. Do we have the technical know-how to produce a com-
petitive product? Do we have the plant capacity? Do we have the necessary capital? Do we
have good top management? A "no" to any of these questions may stymie the marketing
effort. Conversely, a strong advantage in cost control or dynamic leadership may provide
the company with a competitive marketing advantage that has little to do with marketing,
but everything to do with the business succeeding.
Communication
Few doubt that the secret of success in any relationship is communication. This is espe-
cially true in a marketing relationship, where the attitude of both parties is frequently skep-
tical, the nature of the contact is hardly intimate, and the message delivery system tends to
be impersonal and imprecise. It's because of these factors that communication plays such
an important role in a marketing organization.
Marketers know that consumers are constantly picking up cues put out by the organ-
ization, or about the organization, that they use to form attitudes and beliefs about the organ-
ization. Many of these message-laden cues are controlled by the organization, including
factors such as product design, product quality, price, packaging, outlet selection, adver-
tising, and the availability of coupons. In this case, marketers follow basic communication
principles that are discussed throughout this book. Most notably, there is a constant attempt
to make sure that all of these elements deliver a consistent message, and that this message
is understood and interpreted in the same way by the various consumers.
On the other hand, there are many message-laden cues that are not under the control
of the marketer, yet may be more powerful in the minds of consumers, and that must be
anticipated and dealt with by the marketers. A recent report that United Air Lines had the
worst customer satisfaction scores created a downturn in both United's stock and customer
reservations. Although there are many sources delivering such information, the three most
prominent are employees, competitors, and the media.
Employees, from the president on down, are all considered representatives of the organ-
ization for which they work. Consumers often assume that the behavior, language, or dress
of an employee is an accurate reflection of the entire organization. Making employees-
and possibly even former employees-positive ambassadors of the organization has become
so important that a new term has emerged-internal marketing.
Competitors say a great deal about one another, some truths, some boldface lies. A
marketing organization must be cognizant of this possibility and be prepared to respond. The
automobile industry has used comparison messaging for over thirty years. Coke and Pepsi have been attacking and counter-attacking for about the same length of time. Negative political messages appear to be very effective, even though few politicians admit to the strategy.
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