Areas Of Study Within Marketing
Fundamentals of marketing|
This course should ensure that students will understand the overall principles of marketing. A fundamentals of marketing course should also introduce students to the concept of marketing research, which is widely accepted as the basis organizations use for key strategic and tactical business decisions.
Of particularly importance, this course should also cover the concept of a marketing mix, consisting of the "4Ps of marketing" (product, price, place, and promotion). And a fundamentals of marketing course should also involve studying market segmentation, positioning, the product life cycle, and brands.
E-commerce receives a significant amount of attention (including from the media). And when various people are asked what percentage of U.S. retail sales they think are made via e-commerce, many will offer high numbers, such as 50% (or even higher). In reality, e-commerce is still in its infancy, with the U.S Census Bureau estimating that only about 7% of 1Q2015 U.S. retail sales were via e-commerce. But at the same time, e-commerce retail sales are growing significantly faster than traditional retail sales (approximately 15% vs. 2% according to the U.S. Census Bureau), and thus e-commerce will increasingly take on vital importance to the success of many organizations.
Beyond just e-commerce, organizations are still finding creative and innovative ways to use broader e-marketing capabilities to locate and attract customers, and to build long-term relationships with them.
A solid understanding of e-marketing will certainly be a key requirement for the successful marketing professional of the future. E-marketing will undoubtedly continue to evolve, with organizations that master it able to achieve dramatically better marketing results, for substantially less cost.
Digital marketing tools
Without question, the fastest growing area within marketing is digital marketing. Companies have found that investments in search marketing, social media, email marketing, and mobile marketing produce significant returns, and can very positively impact their business results. According to a report by eMarketer, U.S. ad spending for digital marketing will grow from 28.2% of total ad spending in 2014 to 37.3% in 2018. By contrast, traditional media ad spending will decrease during that same period, with television declining from 38.1% to 35.7%, print declining from 17.7% to 14.0%, and radio declining from 8.6% to 7.1%.
At the same time, many organizations are indicating the overall digital marketing talent available isn't keeping up with the demand. They refer to a digital marketing "skills gap", and are eager to see univerities and other educational providers offer focused digital marketing courses. They further indicate they need to hire talent that is familiar with actually using digital marketing tools, in addition to understanding digital marketing concepts. They want to hire marketing professionals familiar with creating web sites with e-commerce capabilities, conducting email marketing, utilizing search engines and pay-per-click advertising, using social media, adapting marketing to mobile, and using analytics to help maximize overall digital marketing effectiveness.
Marketing research has long been used as the basis for business decisions. But a variety of factors have significantly increased the importance organizations place on marketing research, including because of the ever-increasing cost of launching a new product or service. One can envision an executive level meeting in a modern organization, where the senior management team is considering some key business decision. And one can similarly envision members of that team (such as a corporate CEO) insisting that marketing research be done before the organization can commit the resources needed to pursue that business decision.
There are a wide range of methods for conducting marketing research, and the absolutely vast amount of information now available online constitutes nothing short of a gold mine for a marketing professional conducting marketing research. But at the same time, the world we live in (including particularly as related to technology) has presented intriguing new possibilities for marketing professionals to conduct marketing research. One prominent example of this is Amazon, and those who have spent time on that site are undoubtedly familiar with "Customers who bought this also bought..." That amounts to a form of marketing research, done transparently and in real-time, with results then applied dynamically to new customer messages and other forms of customer interaction.
It's also worth noting that marketing research is now broadly undertaken by enterprises other than traditional for-profit corporations. Celebrities, professional athletes, politicians, and the military are but some examples where marketing research has become prominent.
The marketing professional of today and tomorrow needs to have a solid understanding of marketing research, including how to plan it, conduct it, analyze it, and apply it. Marketing research on its own doesn't guarantee organizational success. But it is considered a solid component in modern business strategy and execution.
The famous former baseball star Yogi Berra is known for many notable quotes, and one of those was "If you don’t know where you’re going, you’ll end up somewhere else.” That quote certainly applies to modern business, and highlights the need for an organization to create and execute a cohesive marketing strategy. Without a marketing strategy, an organization is likely just reacting to its internal and external environments. And a reactive organization will typically have less chance of success than a proactive organization.
Without a sound marketing strategy, an organization likely doesn’t have a clear understanding of who its target customers are, and what wants and needs they have that it will fulfill. Without a sound marketing strategy, an organization likely doesn’t have a clear understanding of what it’s own strengths and weaknesses are, as well as what opportunities and threats it faces. And without a sound marketing strategy, an organization likely doesn’t have a clear understanding of who its competitors are, and how it can achieve a sustainable competitive advantage.
The marketing professional of tomorrow will increasingly be involved with an organization’s overall strategy, and in fact marketing is often chartered with driving that organizational strategy.
The 20th century saw a dramatic increase in international business, with large organizations pursuing global markets, and even small organizations pursuing markets in multiple countries. And that trend is certainly continuing in the 21st century, with major trading blocs such as the North American Free Trade Agreement (NAFTA), the European Union (EU), and the Southern Common Market (MERCOSUR) playing vital roles in opening new geographical markets to many organizations.
As a result of these prominent trends, a marketing professional without an understanding of international marketing will have limited career opportunities in the future. Increasingly, companies hiring marketing professionals will place significant value on international marketing knowledge and skills. That knowledge and those skills can in part be obtained via a focused study of the complexities and challenges of international marketing, as well as the specifics of how to successfully plan for and implement global marketing programs.
The U.S. Central Intelligence Agency’s World Factbook indicated that in 2014, 77.7% of the U.S. economy was based on services, as contrasted to industry or agriculture. While the U.S. is certainly higher than some other countries in that respect, numerous others are similarly very high, such as France (78.9%), the U.K. (78.8% services), and Germany (68.4%). In fact, some might use the statistics in the World Factbook to draw conclusions related to trends about the global nature of industry (i.e., manufacturing), such as based on China (the world’s second largest economy, with 46.4% services and 43.9% industry).
This is key because a significant portion of traditional marketing material is oriented to marketing products rather than services. In fact, the classic marketing mix is defined as “product, place, price, and promotion”. In the modern business world, it actually has to be stated that the term “product” also refers to “services”, despite the dominance of services in the U.S. economy. Services have distinct differences from products, such as services are perishable (a business consultant’s time can’t be “inventoried” and sold later like a product can), and services are intangible (they don’t have a physical form that can be seen and touched).
The above statistics show the overwhelming importance of services to many world economies, including particularly the U.S. and Western Europe. And as such, it is critical that a marketing professional of the future understand the differences between marketing services (as opposed to products), and how to successfully plan and execute services marketing.
Brand management and marketing communications
When one thinks of the most successful corporations, one immediately thinks of brands. Consider Coke, Pepsi, (Microsoft) Windows, the iPhone, Nike, Gucci, BMW, Sony, and many others. In recent years, it has become broadly recognized that a brand is a particularly valuable corporate asset, and that brands which command “brand loyalty” (or better yet “brand preference” or “brand insistence”) are incredibly powerful competitive tools. The management of such brands is the responsibility of marketing professionals with specialized knowledge and skills related to brand management, and importance of that area of marketing will only increase in future years.
Similarly, the area of marketing communications has taken on ever more importance during recent years. Marketing communications can take many forms, including direct mail web sites (along with numerous others), and quite prominently advertising. And to highlight just how much emphasis is placed on the advertising aspect of marketing, the New York Times estimated that a 30-second television ad during a recent Super Bowl cost approximately $4 million. Perhaps an even stronger indication is the fact that the television ads run during the Super Bowl now seem to draw as much of an audience as the football game.
Without question, a marketing professional with an understanding of brand management and marketing communications will be in significant demand in the foreseeable future.
It’s probably intuitive that it’s very important for an organization to understand its customers in order to achieve success. What may not be obvious, however, is that understanding customers is actually a complex aspect of marketing, and in fact an area that deserves a focus in an undergraduate marketing curriculum.
Customers come in many forms, including at the high level, consumers, businesses, and governmental agencies. But of course customers are far more distinct than that. As an example, a 16-year-old female would typically be a very different type of customer than a 70-year-old male, and a marketing professional would need to take that into account in all aspects of a marketing mix (product, price, place, and promotion). Along those same lines, a 3-person corporation would likely be a very different type of business customer than a 40,000 employee global corporation.
Key to being successful at identifying and fulfilling customer wants and needs is understanding customer behavior. That includes what influences their buying decisions, what their buying process is, and how that can be taken into account in overall marketing programs.
An undergraduate marketing course focusing on customer behavior can provide a marketing professional a much deeper set of skills to utilize in achieving business success. And by contrast, a marketing professional who doesn’t understand customer behavior (as related to his or her specific customers) is likely to make mistakes (perhaps significant mistakes) or outright fail.
Marketing channel management
Like no other time in history, the concept of marketing channels has become critical to business efficiency and business success. And in fact, there are companies that have taken advantage of particularly modern approaches to marketing channels, to the extent that their channel becomes their core competency, and their key point of differentiation.
Consider Amazon, and the approach it took to creating a unique and revolutionary marketing channel when it first started selling books. There were well-established and very successful book retailers, such as Barnes & Noble and Borders. Amazon gained a significant market share of the book retail market, not by selling different books. They achieved that by focusing on their marketing channel, and making that as efficient (particularly in terms of cost) as possible. They found ways to create a “value network”, consisting of authors, book publishers, and other intermediaries, to capitalize on the network’s vast inventory...without having to physical move books around until doing so was truly needed in order to fulfill a customer’s order.
Perhaps one of the strongest indications of the power of Amazon’s marketing channel (and thus the importance of marketing channels overall) is the fact that while it was still a market leader in the book industry, Borders for a significant period of time decided to utilize Amazon's channel, despite having a strong and successful traditional book retail infrastructure. And subsequent to that, Borders simply couldn't compete with Amazon's channel, and ceased operations in 2011.
Sales and sales management
Few would disagree about the importance of sales and sales management to organizational success. An organization’s sales team is responsible for the very closest interaction with customers, and is similarly responsible for the actual generation of revenue. But for some reason, sales as a professional historically hasn’t been given the same level of academic focus as other business disciplines such as finance, marketing, and human resources.
In the recent past, however, there has been an increasing awareness that sales and sales management is a distinct profession with its own set of skills, knowledge, and methodologies, not unlike those of its peer business disciplines.
Although many would consider sales separate from marketing, the two groups are very closely aligned in most organizations. And in fact the overall “sales cycle” is actually a process starting with marketing and ending with sales, and it’s vital that there be an efficient and smooth transition to ensure the organization builds lasting relationships with customers.
The marketing professional of the future needs to have a solid understanding of sales and sales management, and fact in some in marketing may ultimately choose careers in sales. And modern technology has at times further blurred the distinction between marketing and sales, such as in organizations like Amazon. In those organizations, the marketing group may well be formally responsible for sales, because marketing is the group that creates the customer sales experience.
Similar to the sales profession, public relations (PR) is viewed by many as a professional area distinct from marketing, which historically hasn’t been given the same level of academic focus as other business disciplines. And also similar to the sales profession, public relations is often tightly aligned with marketing, in part because it’s critical that both groups have consistent and integrated two-way communications with all stakeholders.
But without question, public relations plays a vital role in the success of most modern organizations. In many organizations, public relations is the voice of the organization for communications with external stakeholders such as the media and relevant communities, as well as with internal stakeholders such as employees. The field of public relations includes a significant amount of material related to how to proactively and reactively manage a wide range of situations, and how to best manage relevant organizational policies and messages so that stakeholders have a positive overall perception of an organization.
In a now-classic case, in 1982, Johnson & Johnson’s public relations team was faced with a PR nightmare when news reports indicated deaths had resulted from tampering of Tylenol capsules. To highlight the importance of an effective and professional public relations, Johnson & Johnson’s public relations team is credited with having done an outstanding job of managing that crisis, and thus maintaining the integrity of the company, its brand, and its product. And beyond that, the team likely saved many lives by their prompt and professional management of the situation.
A solid understanding of the field of public relations is vital to the marketing professional of the future.