Adbms Marketing Evaluation And Control 42h2h

Marketing Evaluation and Control

Five Components of Marketing Management a. b. c. d. e.

Research Implementation Control Evaluation Planning

Methods of Organizing a Marketing Department a. Marketing and promotional mix elements b. Facilities or services c. Geography d. Customer groupings e. A combination of two of the above four criteria

Marketing Implementation is the process that converts plans into

assignments, which after successful achievement accomplishes the plan’s stated objectives

Marketing Implementation  marketing programs  Diagnostic skills  Identification of company level  Implementation skills  Evaluation skills

Definition of Marketing Control

Steps that an organization takes to ensure that its marketing plans are successful.

Marketing Control iBudget

Profitability Efficiency (Productivity)‫‏‬ Strategic

Budget Control Measurement of results against monthly/quarterly budgets (goals)‫‏‬ Reasons for deviations (variances)‫‏‬ Remedial steps to be taken to close the gaps between performance and goals Review performance in the next month/quarter and assess results

Benchmarks for Efficiency • against last year • against budget • against targets

• % growths • % variances • % market share

Profitability Control    

80 : 20 rule Product rationalisation Customer rationalisation Costing Analysis

Efficiency Control    

Sales force efficiency Advertising efficiency Sales promotion efficiency Distribution efficiency

Sales force Efficiency – No. of calls per salesperson per day – Average revenue per sales call – Average cost per call – Average call time per call – No. of new customers per period – Sales force cost per unit sales

Advertising Efficiency  T  Before and after measure of attitude towards the product  No. of enquiries per ad  Cost per enquiry

Sales Promotion Efficiency

 % sales sold on ‘promotion’  Display cost per sales rupee  % coupons redeemed  No. of enquiries resulting from a demonstration

Distribution Efficiency  Time taken to execute orders  % order executed  service levels

Other Control Measures  Marketing Effectiveness Review - customer philosophy, integrated marketing organization, adequate marketing information, strategic orientation and operational efficiency  Marketing Audit - comprehensive , systematic, independent and periodic review of a company’s business environment, objectives, strategies and activities with an idea to identify areas of weaknesses and recommend a plan of action to improve on such areas.

Control Process for the Marketing Plan

a.Setting standards based on plans b.Measuring performance against standards  Correcting deviations from standards and plans

Marketing Expense • • • •

Sales Force • Sales istration Advertising Sales Promotion • Public Relations • Direct Market Marketing Research

Definition of Marketing Evaluation Techniques used after the marketing plan period to analyze success in achieving individual marketing objectives and to more broadly assess the entire organization’s marketing efforts

Marketing Evaluation Techniques  Sales analysis  Market-share analysis  Marketing cost and profitability analysis  Efficiency ratios  Marketing-effectiveness rating review  Marketing audit

Evaluation and Control

Financial Analysis

21

Evaluation and Control  Strategic control  The Marketing Effectiveness Review  The Marketing Audit  Marketing audit’s four characteristics: Comprehensive Systematic Independent Periodic 22

Marketing Audit “Marketing audit is a comprehensive, systematic, independent, and periodic examination of a company’s—or business unit’s—marketing environment, objectives, strategies, and activities with a view to determining problem areas and opportunities and recommending a plan of action to improve the company’s marketing performance” Philip Kotler

Who will do the Audit When and how often

Areas to be audited

The Audit Process

Developing Audit Forms

Presenting resukts to the management Implementing the audit

The Marketing Audit Process (2)‫‏‬

The audit is conducted by company specialists, company division or department managers, or outside specialists. 2. It may be done at the end of a calendar year, or the annual reporting year, or when doing a physical inventory.

A horizontal audit studies the overall performance of a .firm, emphasizing the interrelationship of variables. A vertical audit is an in-depth analysis of one aspect of a firm’s marketing strategy. 4. Audit forms list the topics to be examined and the exact information required to evaluate each topic.

Implementation decisions include: the timing and duration, employee awareness, when and how audit is performed, and how the audit report will be prepared. 6. Findings and recommendations are given to management. 5.

Characteristics of Marketing Audit

 Comprehensive  Must cover all marketing areas

 Systematic  Sequential diagnostic steps

 Independent  Internal & external auditors

 Periodic  Performed at regular intervals

Marketing Audit Procedure

 Marketing environment audit  Marketing strategy audit  Marketing organization audit  Marketing system audit  Marketing productivity audit  Marketing function audit  Marketing excellence review  Ethical and social responsibility review

Marketing and Society: Social Responsibility and Marketing Ethics 30

Ethics and Morals Ethics

The moral principles or values that generally govern the conduct of an individual.

Morals

The rules people develop as a result of cultural values

9

Ethical Behavior in Business

Ethical?

Legal?

Ethical Development More Levels Selfish Preconventional Morality Conventional Morality Postconventional Morality More Mature

9

Morality and Business Preconventional Ethics Morality ● Childlike level ● Based on what will be punished or rewarded ● Self-centered, calculating, selfish

9

Morality and Business Ethics Conventional Morality ● Moves toward the expectations of society

● Concerned over legality and the opinion of others ● “When in Rome, do as the Romans”

9

Morality and Business Ethics Postconventional Morality

● Morality of the mature adult

● Concern about how they judge themselves ● Concern if it is right in the long run

9

Code of Ethics A guideline to help marketing managers and other employees make better decisions.

9

Creating Ethical Guidelines  Help identify acceptable business practices  Help control behaviour internally  Reduce confusion in decision making

 Facilitate discussion about right and wrong

9

Unethical Practices

10

Corporate Social Responsibility Philanthropic Be a good citizen. Ethical Do what is right. Legal Obey the Law.

Economic Be profitable.

Corporate Social Responsibility (CSR)‫‏‬  Sustainability  Must have a healthy society to sustain business.  Pyramid of CSR  Economic  Be profitable. Must survive.  Legal  Obey the law.  Ethical  Do what is right, just and fair.  Avoid harm.  Philanthropic  Good corporate citizen.  Contribute resources to community.

Marketing’s Impact on Individual Consumers: Deceptive Practices

Deceptive Pricing Deceptive Promotion Deceptive Packaging

Falsely Advertising “Factory” or “Wholesale” Prices, Large Reduction From Phony High List Price Overstatingt he Product’s Features, Luring Customers to the Store for Out-of-Stock Bargains, etc. Exaggerating Package Contents, Not Filling Package to the Top, Using Misleading Labeling 42

Marketing’s Impact on Individual Consumers  High-Pressure Selling



 Some products – such

as cars and jewelry – are said to be sold, not bought.  Such tactics damage marketer’s long-run relationship with customers.



Shoddy or Unsafe Products products are not made well.  products deliver little benefit.  Concerns product safety. 43

 Planned

 Poor Service to

Disadvantaged Obsolescence Consumers  Hold back  May pay more attractive for inferior functional goods. features.  May break, wear, rust, or rot sooner than should. 44

False wants and much materialism

Production of too few social good

M a rk e tin g s s Im p a c t o nS o c ie ty a saw h o le

Too much Political power

Cultural polution

Marketing’s Impact on Other Businesses Acquisitions of Competitors

Marketing Practices Create Barriers to Entry

Unfair Competitive Marketing Practices

46

Consumerism Consumerism is an Organized Movement of Citizens and Government Agencies to Improve the Rights and Power of Buyers in Relation to Sellers.

Buyers’

Sellers’

Rights

Rights

47

Consumerism – Buyers’ Rights ‫‏‬The Right Not to Buy a Product Offered for Sale

‫‏‬The Right to Expect the Product to be Safe ‫‏‬The Right to Expect the Product to Perform as Claimed The Right to Be Well Informed About the Product The Right to Be Protected Against Questionable Products The Right to Be Heard About “Quality of Life” Issues 48

Marketing Ethics Companies Need to Develop Corporate Marketing Ethics Policies – Broad Guidelines That Everyone in the Organization Must Follow and Should Address:

 Distributor Relations  Advertising Standards  Customer Service

 Pricing  Product Development  General Ethical Standards

49

Marketing Ethics

principles That Should Guide Companies and Marketing Managers On Issues of Ethics and Social Responsibility:

Decided by theResponsibility of Free Market and Individual Legal System Companies And Managers

50

Marketing’s Second Social Responsibility

• Personal Codes of Ethics – General leave specific interpretation up to the implementation of marketing strategy – American Marketing Association • Developed a code of ethics that marketing professionals turn to

Objective 3 Copyright ©2005 by South-Western, a division of Thomson Learning. All rights51 reserved.