Reference no: EM131046422

Enu-geem-bk-en-GB May 20, 2014 - 11:31 1 Global online I Core reading Global Economic Environment and Marketing Dr. A. Gavris A. McLeod Release 1.1 2013 www.napier.ac.uk/business-school enu-geem-bk-en-GB May 20, 2014 - 11:31 2 Published by Edinburgh Napier University Edinburgh Napier University The rights of Dr. A. Gavris and A. McLeod to be identified as authors of this work have been asserted by them in accordance with sections 77 and 78 of the Copyright, Designs and Patents Act 1988.

Questions

1. How can we spot and choose the right market?

2. How can we differentiate our offerings?

3. How should we respond to customers who buy on price?

4. How can we compete against lower cost, lower-price competitors?

5. How far can we go in customising our offering for each customer?

6. How can we grow our business?

7. How can we build stronger brands?

8. How can we reduce the cost of customer acquisition?

9. How can we keep our customers for longer? 10. How can we tell which customers are more important?

11. How can we measure the payback from advertising, sales promotion, public relations?

12. How can we improve sales force productivity? 13. How can we establish multiple channels and yet manage channel conflict?

14. How can we get the other company departments to be more customer-oriented? (Kotler et al, 2012) Hooley et al (2012) suggest that the importance of understanding the macro environment is twofold.

First, to recognise the marketing impact of change in the business environment and to respond to it. Second, to be alert to the fact that the nature of the change facing organisations is itself changing from continuous incremental change to discontinuous change, making customer requests unpredictable and strategies shift from efficiency to flexibility and responsiveness. The process of monitoring and analysing the external environment of a company is called environmental scanning. There are nearly 200 countries in the world and in theory, every event in the world has the potential to affect a company's operations and these macro events are uncontrollable.

Basic theory suggests that companies exist to satisfy needs in the marketplace and marketers can only satisfy these needs to the extent that they understand what these needs are. Jobber (2010) suggests that an understanding of customers can be gained only by asking the following five questions:

1. Who is important in the buying decision? A number of people may be directly involved in the purchasing decision and process. If so, it is clearly important to us as marketers to know who these people are as the outcome of the decision will depend on their behaviour. Equally, a number of people may be indirectly involved, influencing the decision by merit of their status or knowledge. Blackwell et al, in Jobber (2010, p.110) cite the case of a household decision to buy something being influenced by various actors in the household, each playing one of five roles: • Initiator • Influencer • Decider • Buyer • User Marketers for Virgin Media often feature the whole family in their advertising in recognition of these likely influences.

2. How do they buy? We can observe whether consumers are taking great care over a purchase or whether it is an impulse buy with little or no serious consideration of the outcome. Is the decision process simple of complex?

3. What are their choice criteria? What products they buy, at what price and with what features.

4. Where do they buy? We can observe whether the place of purchase appears to be important and forms a part of their choice criteria.

5. When do they buy? The occasion of purchase would normally be at the consumer's discretion. However this is not always the case as a purchase may be driven by need. In B2B markets, ‘who is important in the buying decision' takes on major significance in high value transactions and this will be addressed later in this chapter.