3: The Marketing Management Process
The marketing management process implies that marketing should be a managed activity, a coordinated effort with careful planning rather than a haphazard collection of disjointed initiatives (which even today, is still the case with many companies). The author divides the process into four phases: planning, organization, implementation, and control.
Planning
The planning phase involves multiple activities: analyzing the market situation, setting objectives, selecting a target market, and developing a program.
Analyzing the Marketing Situation
The market "situation" first considers the environment: the buyers and sellers in the market, their predicted behaviors, and the external forces that may influence their plans and decisions.
Given this analysis, the company identifies market opportunities, which generally includes appealing to new customers (either entirely new ones or weaning buyers away from competing firms) or servicing existing ones (to maintain or increase share of wallet) and the consideration of whether advancing on those opportunities is feasible given organizational resources.
The author also mentions a marketing audit, which considers whether the company's marketing efforts are appropriately directed with an eye toward making a corrective change or improvement (EN: This seems like a "control" step, evaluating actions in arrears, and the results of the audit would feed into future planning - but again, the audit itself is part of the control process).
Finally, the author suggest SOWT analysis as a method of identifying opportunities in the market (EN: however, his approach to SWOT analysis is misguided and therefore not worth annotating).
Setting Objectives
After analyzing the marketing situation, the marketing manager sets specific objectives for the firm - i.e., given the environment and opportunities, what course should the company take? This should focus on achieving goals rather than reacting to day-to-day problems and minor crises. The latter are necessary, but focus on them can muddle or undermine the achievement of strategic goals.
The author mentions that the marketing objectives must be consistent with the company's mission and long-term goals. (EN: I don't think he provides sufficient emphasis on this point. Many of the most resourcing failures of marketing in the past few decades has been the result of companies pursuing opportunities that were out of line with the character and interests of the organization.)
Objectives may be set for various periods of time. The longer the range, the less specific - but at some point, granularity is necessary to give clear direction and aim for measurable results. For example, a long-range goal would be to "become a household name" whereas a short-range goal might be "within the next 12 months, we will increase the number of retail outlets that carry our product by 20%" - though it is cautioned that objectives must be attainable targets based on sound reasoning, or they will be dismissed.
Selecting the Target Market
(EN: The author suggests that the target market is selected after setting the marketing objectives - but to my way of thinking, this is backwards. In order to be specific and reliable, objectives must be expressed in terms of a desired target market. You do not take aim before deciding what you're trying to hit - so you must have a general idea of the target to set a general objective, then a specific idea of the target before setting specific objectives.)
The author uses the example of an entrepreneur who wants to open a restaurant, but must determine which kind of restaurant to open by considering the characteristics of the target market (primarily, are there sufficient buyers who purchase in sufficient quantity to make the plan economically viable) and the competitors who currently serve them (the more competition, the tougher the fight, and the lesser the rewards).
(EN: I dislike "entrepreneur" examples - it's a rare, speculative, and artificial situation. It is more likely that a marketer is working for an existing firm with an existing product and an existing market, and the "target" is defined in the market analysis step, above - or in some cases, uncommon but less rare, the marketer is tasked with expanding into new markets and has greater flexibility, but still not as open as a situation of pure entrepreneurship.)
A firm choosing to focus on a single, easily defined market segment is using a concentrated marketing approach. Companies like McIlhenny Co. (makers of spicy Tabasco sauce), Motel 6 (low-cost, no frills motels), and Porsche (very expensive, high-powered sports cars) have used this approach successfully. This approach is often referred to as "niche marketing."
The firm's choice of markets shapes its marketing activities: a firm that focuses on a single, narrowly-defined market segment practices "niche marketing"; one that seeks to appeal to several market segments uses a "differentiated marketing" strategy; one that seeks to appeal to a broad array of market segments using a single marketing message is using a "mass marketing" strategy.
(EN: the author does mention mass marketing at all - I tossed that in. I expect it's because mass marketing has fallen out of fashion, and it is inherently a very messy process that is contrary to the "precision and control" principles that are currently in vogue in marketing. But is remains a strategy that is in use and can be quite effective for certain products.)
Developing a Marketing Strategy
A firm's marketing strategy consists of the overall principles by which it will conduct its marketing activities. As an example, the author contrasts a couple of generic strategy options: cost leadership (in which a firm seeks to be the cheapest provider) versus differentiation (in which the firm seeks to convince the market that the unique value of its brand or product is worth paying a premium on price).
(EN: I don't think the author carries this quite far enough. "We are going to be a cost leader" is definitely a strategic decision, but t is not the end product of the strategic process. Most often, strategy formulates this high-level "vision" but then proceeds to set more granular organizational goals of a more short-term and specific nature before handing them off for implementation.)
Organization
Generally, a firm's marketing organization is subdivided into groups by one of three methods (or in some instances, by more than one):
Geographic Organization creates departments for specific locations. This is most obvious when a company attempts to reach a global consumer base and the organization is split according to continent or country (e.g., North American, European, and Asian sales bureaus).
Target Market Organization creates different departments for various target markets. An example of this schema is when a company has different departments for retail consumers, organizational (wholesale) consumers, and government contracts.
Product Organization is often used by companies that have different product lines. As an example, Volvo currently produces cars, trucks, tractors, and jet engines (among other things), and the marketing for these four products is done by separate departments.
(EN: This is another situation in which the author seems to lost context and practicality. In a grand sense, a company decides how to organize itself according to one or more of these schemas, but this tends to be very long-range planning. It's most often that a marketer is brought into a firm that has such a differentiation and must develop strategy within his department, and has little input into organizational structure. Though on occasion, companies may reconsider their structure, this is far less common.)
Implementation
The implementation of marketing plans is done on a lower level: senior executives communicate the high-level plans to the mid-level managers, who are responsible for carrying them out.
(EN: That's all author has to say, which identifies the need for additional study in this area. In my own experience, the stumbling point of many marketing organizations is that they're great at coming up with ideas but miserable at implementing them, which defeats the entire point.)
(EN: It's also worth noting that I find the little that the author does say to be misguided. The top-down model of management, where the people who sit in offices do all the thinking and hand off plans for others to follow is a recipe for disaster. Current theories of management stress that an organization should be run bottom-up, and that the "lower" ranks have the greatest expertise and experience, and should be involved in, and even drive, the planning process.)
Control
The marketing control process is applied as plans are implemented, to determine whether the initiatives being implemented as intended and are having the intended results.
To be effective, the control process should evaluate the ongoing efforts compared to standards (benchmarks) that were established during the planning process. These standards should be specific and measurable, and may pertain to efficacy measures (such as the number of sales being generated by a campaign) or performance measures (the amount of budget that is being spent to execute the plan).
It's also worth noting that corrective action may become necessary to keep the plan on track or, in some instances, to make tactical changes to the plan if design flaws become apparent in the strategy. In the worst of cases, a plan may need to be scrapped in-flight, or the organization should be prepared for unanticipated results.
(EN: The author does not mention an important topic: which is keeping an eye out for the unintended. It's entirely possible for a plan to be working as intended, but to have potentially harmful side effects. Granted, there is no systematic way to plan for the unexpected - but a plan should be able to consider potential side effects, and close communication with the front lines can identify unexpected consequences that may arise.)