Follow-up

1 Explain the following words/ phrases from the texts.

Text 1: changes in customer perceptions, marketing strategy, customer needs.

Text 2: customer base, market segmentation, expertise.

2 Form two groups and discuss the problems/ ideas mentioned in the texts. Present the results of your discussion to each other.

Text A New marketing, or old ideas?

Among the favourite words of marketers are ‘new’, ‘improved’, and ‘innovative’. Each year brings its crop of new ideas about the philosophy and practices of marketing, some of them being dressed up in pseudo-scientific terminology by consultants and academics, eager to use their knowledge base to sell a new idea to people who fear being left behind. In fact, basic principles of marketing have been quite enduring, and claims for completely new approaches to marketing should be treated cautiously. For the experienced marketer, most new ideas are based on age-old underlying theory, and there is usually some form of precedent for new ideas.

The Internet was hailed as a completely new approach to marketing, and at the height of ‘dot.com’ mania around 2000, some advocates had a vision of the Internet allowing almost infinite and cheap communication possibilities, breaking down monopolies, international trade and cultural barriers in the process. The world of marketing would never be the same again.

The Internet has certainly changed the way that many companies practise marketing, but underlying principles have often won out over the hype. ‘Disintermediation’ was held out as a great opportunity by which the Internet would cut out intermediaries, as people buy airline tickets, books, and financial services directly from the producer, rather than using an agent, retailer, or broker as an intermediary; but basic theories of marketing suggest that people like to be presented with a manageable choice in one location. It should therefore have been no surprise that instead of ‘disintermediation’, many new information intermediaries such as Expedia.com, Amazon.com, and moneysupermarket.com emerged to fulfill this role. Internet auction sites such as eBay have been proclaimed as a new way of marketing to customers on a one-to-one basis, but the basic principles underlying them can be traced back to marketing practices found in ancient Kasbahs. Many of the big Internet service providers realize that successful Internet marketing requires a sound understanding of basic human behaviour, and many have appointed teams of anthropologists to try to understand users’ deep-seated motivations, and how these relate to modern technology. Among current burning questions are whether ‘Web 2.0’ and social networking sites, such as Facebook, really represent a new marketing approach, as buyers seek out information from their peers rather than through conventional advertising. Again, theories based on social sciences may suggest that although the technology is new, the nature of people’s need to belong and their methods of developing trust are longstanding.

Practitioners of marketing make excessive use of the word ‘new’, to describe anything from a ‘new and improved’ breakfast cereal to a new way of looking at the world. However, we should never forget that many of the underlying principles of marketing are quite timeless. We really need to distinguish between genuinely new marketing ideas—which are quite rare—and old ideas that have been applied to a new marketing environment.

Text B Are they really marketing oriented?

Companies that have wholly embraced the marketing philosophy put customers at the centre of everything they do, so that being ‘marketing oriented’ becomes a state of mind for all of their employees. They should all be aware that if they don’t put customers first, somebody else probably will and will win their profitable business. Here are some tell-tale signs of a company that may claim to be marketing oriented but where, in fact, not all of its employees have taken on board a genuine marketing orientation.

• In the car park, the prime parking spots are reserved for directors and senior staff rather than customers.

• Opening hours are geared towards meeting the social needs of staff rather than the purchasing preferences of customers.

• Management’s attitudes towards lax staff are conditioned more by the need to keep internal peace than by the need to provide a high standard of service to customers.

• When confronted with a problem from a customer, an employee will refer the customer on to another employee without trying to resolve the matter him/herself (‘it’s not my job’).

• The company listens to customers’ comments and complaints, but has poorly defi ned procedures for acting on them.

• Advertising is based on what senior staff want to say, rather than a sound analysis of what prospective customers want to hear.

• Goods and services are distributed through channels that are easy for the company to set up, rather than on the basis of what customers prefer.

Can you think of any more tell-tale signs? Can you identify companies that exhibit the characteristics described above? Why do you think the company can behave in such a way? Are there insufficient competitive pressures facing the company to warrant change? What, if anything, would you do to bring about change in the company?

UNIT 2