Importance Of Marketing In Todays World Marketing Essay

Introduction:

According to the American Marketing Association marketing is defined as 'activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large'(American Marketing Assocation, 2007).

Drucker states 'the aim of marketing is to make selling superfluous' (American Marketing Association, 2007). By keeping the above definitions in view we can say that to identify customers' needs and act accordingly to satisfy their needs is called marketing. The aim of this report is to develop an understanding of marketing concepts, use and apply it to Marks & Spencer (M&S) in order to understand the role and significance of marketing.

Importance of Marketing in today's World:

Due to Economic downturn marketing has gained importance in past few years in order to gain the attention of the consumers.In 21st century marketing has become one of the key strategies used by organisations world wide. Companies can not use one simple marketing strategy which meets the need of both markets' and consumers' because they are so versatile to be dealt collectively this is because of continues change in modern society. Cultural changes and advancements in technology divided a market into so many segments.In order for M&S to capture large market share it has to set up successful market strategies and make the most of technology.

M&S Marketing Process:

In the past and the present M&S proved to be successful to meet its consumers continuously changing needs by effectively implementing marketing processes. Following are the four stages which helped M&S to understand & fulfil its customer's requirements.

Situational Analysis:

In this stage of marketing process companies like M&S keep both internal and external environment in view to carry out the market place analysis and try to spot gaps in the market. 'In addition to identifying the customer needs, must understand its own capabilities and the environment in which it is operating' (NetMBA, 2007).

This stage is very vital as the rival companies such as Tesco and Waitrose are always coming up with new ideas and new products etc so that they can stay ahead in the competition. In SWOT analysis this rapidly changing marketing environment comes under the heading of threat.

Marketing Strategy:

By keeping the core purpose of this report in view, the major change in approach which has been seen in the companies is the shift from mass marketing approach to target marketing. In target marketing approach companies try to identify trends in the segmented market as it's the one of the most important factor in STP.

Segmentation

There are two main types of segmentation i.e. geographic and demographic segmentation. The later one is used by M&S to target market for its products and it recognizes its consumers by social class , income and age which is very crucial for success in today's world e.g. clothing line is divided into three segments i.e. premium price, medium priced, and low price.

M&S customer segmentation is also divided in following 4 groups (Carbon commentary, 2007):

Green zealots: people who will actively seek out the most ethically and environmentally responsible products. Climate change is particularly important issue to these people.

Those interested and concerned, but often uncertain how to shop to achieve their ethical objectives.

Aware of the problem, not certain that their actions can have much effect or that they need to shop differently.

Struggling, don't give priority to issues.

Targeting:

DAMP (distinct, accessible, measurable and profitable) process is used by M&S to understand, identify and target the required segments of the market. According to the marketing director , Steven Sharp , 'although we sell to everybody - big, small, young, black, white - our absolute target market is a bit older and is comfortable with traditional media' (Telegraph, 2006). It means that M&S targets, offers (products and services) and sells to a large market but mainly to a mature age group.

Positioning:

'The From this it can be seen that M&S targets a very large audience, but the key here is to target the mature age group way that an audience of consumers or buyers perceive a product or service' (Baines, P. Fill, C. Page, K., 2008, pg.251). This definition of positioning means that perception has a great deal of importance in terms of both physical attributes and the deliverance of a product. M&S's market research information provides a key analytical tool in identifying a consumer's preference.

M&S and the Consumer Society:

'A consumer society is a culture in which consumption of material goods is encouraged, and the economic health of the society is dependent on the spending of the population' (Xaxx, 2010). Basically in consumer society companies make the consumers feel that they need specific product in their life so here marketing plays an important role in terms of attracting consumers to buy a specific product.M&S should be very careful in terms of fulfilling consumers' expectations regarding price, convenience and experience as a whole because

consumers behaviour is seen to be rapidly changing. M&S is advertising its products quite cleverly to its target market and persuading consumers as M&S itself is a symbol of quality so whatever they sell is of high quality which has a psychological effect on the target market, persuading them to buy particular products/services they offer.

Marketing is 'undoubtfully fashionable' (Baudrillard, 1988, p.30) it means marketing is a bridge of communication in terms of both introducing products for sale in the market and letting people know how eco friendly they are, which is practiced by M&S. M&S is also part of fashion industry of which marketing environment is rapidly changing, by the help of PESTLE analyses we can look into that and the importance for M&S to adapt these changes.

PESTLE Analysis:

Political, Economical, Social, Technological, Legal and Environment analysis are used to explore external environment.

Political:

Political factors like government policies, taxation, subsidies and grants can effect M&S operations e.g. if government increases taxes then, M&S have to cut their costs, which can include M&S reducing expenditure on marketing.

Economic:

Economic factors include inflation, taxation, interest and consumer buying power etc basically it includes and affects everyone in the economy. It affects M&S marketing strategy and their operation in the market. Consumer buying power means M&S shift focus on their pricing strategy carefully, to attract consumers and hence boost sales.

Sociological:

Consumer buying behaviour and demographic are the factors involved in sociological analyses. Consumer behaviour is the main aspect of marketing, as it focuses to understand consumers' preferences, habits and attitudes and then act accordingly in order to attract customers. M&S being quality conscious not only try to keep up with their quality standard but also tries to improve it in their stores which they also show in their advertisements. This will have good psychological impact on consumers mind as well as they will always relate M&S to quality.

Technological:

Advancement in technology eased out marketing for companies in 21st century. Internet proved to be one of the biggest revolutions in the field of marketing as it made communication and transfer of information effortless. Internet played a vital role in communication and transfer of information worldwide. M&S is marketing its brands and products through its website which is easily accessible by the consumers basically they are one click away from buying required products/services.

Legal:

M&S has to follow certain legalities while trading, dealing with employees and competitors and make sure that all the action they perform are legitimate in the eyes of law.

Environmental:

The last but not the least factor of PESTLE analyses is environment. One of the reasons behind M&S success story is that they have a good organisational culture and this factor also makes a distinction from its rival firms.

Marketing Mix Decision at M&S:

The term "marketing mix" became popularized after Neil H. Borden published his 1964 article, The Concept of the Marketing Mix

Product:

A product is defined as 'anything that is capable of satisfying customer needs' (Baines, P. Fill, C. Page, K., 2008, pg. 15). There are three levels of product i.e. core, actual, augment.

Core level proves to be the most beneficial and meaningful part of the product. It's the final product being served to the customers for example, M&S jackets made from wool being served to customers as clothing to keep the warm. Whereas, the method by which a product is delivered to M&S customers comes under the heading of actual product and augmented product is concerned with how the customer receives the product and also considers after-sales services. Women show their keen interest in M&S that's why M&S makes the most of the profit from women wear however M&S still tries to enter new market by conducting market research and bringing out innovative products. Food store is a success story of M&S capturing new market.

Price

Price is what company charges for a product to the customers. In 4p's of marketing mix for a company price is the only factor of source of income. On the other hand product, place and promotion are the cost for the company. While charging for products and services M&S keeps the current market value in view. 'More cost based than most' is the type of policy used by M&S for pricing (Daily Mail, 2009) which differentiate it from its rival companies.

Place

Customers can purchase product from the available place. M&S has 'over 600 stores located throughout the UK, ranging from large out-of-town and flagship stores of over 100,000 sq ft, to Simply Food stores of around 7,000 sq ft. Our largest store is located at Marble Arch on London's Oxford Street and has around 170,000 sq ft of selling space'(Marks & Spencer, 2011). M&S is very flexible in terms meeting the demands of its customers and is very carefull and successful till date.