Marketing Strategy: Your Questions Answered

What is the biggest marketing challenge for managers/companies today?

One of the biggest challenges in marketing today is the effects of the COVID-19 global pandemic, because of the new regulations and changing consumer habits that companies will have to adhere to. Bakhtiari (2020) suggests “The pandemic is likely to produce two distinctive behavioural archetypes: people who have embraced a new lifestyle and those who have largely remained unchanged.” Companies will have to adjust to their consumers with new habits, to retain them. However, I think this will be a perfect opportunity for other companies to steal customers by reacting to the changes quicker.

However, it has created many new opportunities for businesses, especially local ones. Due to many travel restrictions, it has forced consumers into visiting local high streets and retailers and purchasing local sustainable shopping. Shavitt and Barnes (2020) research indicates people from individualist cultures prefer buying products and services associated with being successful and autonomous. But if society becomes more community-focused, then so will our shopping habits. Canada Goose are a company that have embraced these community matters concept. Canada Goose are a high-end winter clothing manufacturer that have made a “commitment to produce scrubs and gowns at their manufacturing facilities across (Canada)” (Reiss 2020). Also, I think COVID-19 has forced consumers into more online shopping, which is already a growing facet of shopping habits and allows companies with an online presence more opportunities to be competitive. Rossier (2020) says that “digital platforms are giving a leg up to small businesses”, which I think shows how the importance of community and technology are rising.

Overall, due to COVID-19, I think the way we eat, and shop has changed which means there has to be shifts in strategic focus. For example, there has been an increase in stock buying, due to a fear of shortage. Physical stores shutting down has also led to online shopping as previously said and increase in home equipment (such as home gym).

What influences your own personal buying behaviour?

There are many factors that influence my buying behaviour, I think most importantly would depend on whether they have a good online presence that can be easily accessed. Newman (2015) suggests that “mobile is going to become the centre of marketing.” This increases the convenience of marketing even more and allows for a personalized relationship with customers. This leads to my next point; I think transparency between brands and customers is very important to be able to trust a brand, and genuine brands that create real value will be rewarded (Newman 2015).

An example of a company that uses the factors that influences me is ASOS, a British online fashion and cosmetic retailer. ASOS operates solely online which is very convenient for its users and has aided their business during the COVID-19 pandemic. ASOS is also very transparent with its customers, an example of this is them becoming the first retailer to commit to best practice around marketing Buy Now, Pay Later (BNPL) products such as Klarna, thanks to the #regulateBuyNowPayLater campaign which was launched in June 2020 by Alice Tapper and “calls for greater protection for young and vulnerable consumers” (Hastings 2020). This is a very customer-oriented approach and Brent Hobson, Head of Payments at ASOS says that he wants “to provide customers with an outstanding retail experience” and that “customers have access to the information they need to make informed choices and actively encourage them to use payment options responsibly” (Hobson 2020).

Overall, there are many factors that influence buying behaviour, and these factors need to work together to get customers and retain them. Another notable influence is environmental factors that are becoming of increasing importance due to current circumstances with global warming. Therefore, I think it is an extreme importance that companies go in this direction and create products and services that are environmentally friendly e.g., products that are organic and recyclable.

Do you think that if companies strive to be more socially responsible, they can improve their competitive advantage?

Overall, I think that if companies thrive to be more socially responsible, it can help them improve their competitive advantage. Prior research has argued that socially responsible firms are likely to deliver superior financial performance—an argument supported by several studies demonstrating a positive link between investing in corporate social responsibility and a firm’s financial performance (Russo and Fouts 1997). Now, for millennials and Generation Z, they believe companies should be more invested in improving society and be socially responsible (Digital Marketing Institute 2020).

An example of a company that has had success from being social responsibility is Starbucks. Their increasing revenue over the last 5 years can be seen in Table 1 below, which shows they are constantly improving their competitive advantage whilst having social responsibility. They are looking to diversify their workforce by providing opportunities for certain cohorts, such as a pledge to hire 25,000 veterans by 2025 and look to hire more younger people to jump start career. Also, Starbucks joined with the UN Refugee Agency to increase the company’s support and efforts to reach refugee candidates to hire 10,000 refugees by 2022 (Digital Marketing Institute 2020).

Table 1

Source: Starbucks Revenue 2006-2020 (Macro Trends 2020).

However, I do not think that good ethics always means good business. “There is one and only one social responsibility of business – to use its resources and engage in activities designed to increase its profits” (Friedman 1970). Also, managers’ beliefs about the impact of socially responsible activities on perceived product performance converge on the idea that corporate social responsibility programs are unlikely to benefit the company above and beyond their potential to strengthen reputations and mitigate corporate crises. (Chernev and Blair 2015).

Overall, due to people of current generations beliefs, corporate social ability is of more importance and if applied well, I think it will improve a company’s competitive advantage. But I believe there is a limit and companies cannot rely on social responsibility programs to push the company above and beyond.

Explain the benefits and limitations of digital technology for organisation

Barone (2020) says that “digital marketing is the use of the Internet, mobile devices, social media, search engines, and other channels to reach consumers.” I think that for organizations there are both benefits and limitations to the use of digital technology. But in a business world where technology is at the centre of it, it is impossible to ignore it and I think must be used to gain success.

I think the main benefits of digital technologies to organisations are the convenience and the communication and relationships between companies and consumers that can be formed. The internet is now a real-time dialogue with millions with two-way communication that used to be a controlled, one-way message (Sacks 2010). Companies like Apple and Google have embraced digital technology by investing heavily in voice-assisted technology. It is more popular nowadays due the convenience of speaking instead of typing, and to capitalize on this trend it is essential to understand the differences between voice and text-based search. We often vocalize questions. So, it is wise to craft the answers on your website, for example, as if someone asked a direct question (Nassie 2019).

However, a limitation of digital technology is that society is “surrounded by digital we now crave experiences that are more tactile and human-centric… [that] can provide us with the kind of real-world pleasure and rewards that digital cannot” (Sax 2016). I think there will still be a gap in the market for some form of non-technological activity, but a lot of these activities will have to include digital technology.

I think that digital technology is of extreme importance for organisational success and is still of increasing importance and the benefits outweigh the limitations overall and if you do not prepare for the fast-approaching future of technology, there will be consequences.

Explain how and why retailing has changed so much recently and suggest ways that businesses can try to adapt for the future.

In recent years retailing has seen a shift to e-tailing, which is the sale of goods and services through the internet and requires companies to tailor their business models to capture internet sales (Hargrave 2020). “Brick-and-mortar retailers had [already] been fighting a fierce battle against Amazon and other e-commerce players” even before the COVID-19 pandemic accelerated these challenges (Lee Yohn 2020). I think the main reason for the change to e-commerce has stemmed from the convenience it provides for both the business and consumer, whilst also allowing a two-way communication.

I believe that companies that fail to adopt this new way of retailing are set for failure and need to “offer a simple and seamless e-commerce experience — from browsing to researching, selecting, purchasing, and returning/exchanging” (Lee Yohn 2020). I think Blockbusters failed to create a business model which adapted to digital innovations, while competitor Netflix leveraged this opportunity (Antioco 2011).

However, I think there are ways in which businesses like Blockbuster could’ve adapt for the future, starting with the introduction of omnichannel retailing which is a seamless service which allows for interactive experiences which merge physical and digital channels. Within all these operations the customer is placed at the centre and can connect to companies in several ways conveniently. This differs from single channel, which simply is having a brick-and-mortar presence, and multi-channels which is having a website that compliments your brick-and mortar presence (Ishbel 2013).

Overall, I think that businesses need to have an online presence as well as adapting their brick and mortar to comply with the new safety regulations of COVID-19, whilst instituting speed of service and introducing more self-service options. (Lee Yohn 2020).

Explain what is meant by business ecosystems and how it impacts on the B2B market.

Business ecosystems are a network of organisations and is a complex interaction where each organisation affects and is affected by others. Meaning “each member of a business ecosystem ultimately shares the fate of the network as a whole, regardless of that member’s apparent strength” (Iansiti and Levien 2004). Each ecosystem has a keystone, which is a core organisation and plays a critical role in boosting whole of the network.

These keystones aim to improve the overall wealth of their ecosystems, for example Microsoft’s Windows operating system has allowed others to build their offering by using it. Looking at the other side, I think that an ecosystem can fail if their keystone is removed for example, it can “lead to the catastrophic collapse of the entire system. WorldCom’s failure had negative repercussions for the entire ecosystem of suppliers of telecommunications equipment.” (Iansiti and Levien 2004).

B2B describes commerce transactions between businesses. There is a limited number of customers, the size of purchases is huge, and many buyers meaning purchases need to satisfy the whole organisation. I believe the businesses buying decision must then go through the decision-making unit (DMU) which Kotler (2010) describes as “all individuals and groups that take part in the decision-making process relating to the negotiation of products /services”. Business ecosystems impacts the B2B market because in certain ecosystems, one company’s success is dependent on success of others in the ecosystem. Therefore, I believe that B2B relationships should be good between companies in the same ecosystem to have success for every organisation.

Overall, I think that Competition is essential, but not the sole driver of success, for example COVID-19 has forced companies to put differences aside for the greater good of society. Success is based on diversity, the collective ability to learn, adapt and innovate. Ecosystems cannot stay the same, they must evolve. All organisations need to innovate together for success of the whole ecosystem.

Why is customer relationship marketing seen to be important to organizational success?

Relationship marketing can be defined as “the process of creating, maintaining and enhancing strong, value-laden relationships with customers” (Gronroos 1990). I think it is an increasingly important part of marketing, and I believe that businesses should use this idea as the cornerstone of their marketing efforts. The reason for its importance stems from customer value and the need to know what the benefits and costs are to each customer. For me, relationship marketing really looks to treat every customer like a human being rather than just a sale. This can be done by making communication “two way and individualized, or at least tightly targeted at thinly sliced segments” (Rust et al. 2010).

I think Tesco’s approach to relationship marketing is very useful for customer interaction, “Tesco managers spend one week a year working in stores and interacting with customers as part of the Tesco Week in Store (TWIST) program” (Rust et al. 2010). However, I believe that this is one of Tesco’s weaker strategies. The use of Clubcard’s is very effective as it collects customer information and acts on this by giving customers personalised offers relating to their shops. However, these approaches can be considered quite intrusive by some customers. When thinking about relationship marketing and COVID-19, some approaches will have to be adjusted which could affect in person relationship marketing, therefore, having an online presence is vital for businesses to survive in today’s economy.

Therefore, I think the more interactive businesses are with their customers affects the business extremely positively. Lauterborn (1990) interprets relationship marketing as transferring “from 4Ps to 4Cs”, which shows how the 4Ps as more customer oriented. Similarly, to Rust et al. (2010) customer metrics. “Because companies can now interact directly with customers, they must radically reorganize to put cultivating relationships ahead of building brands” (Rust et al. 2010).

Overall, I think that too often markets reward short-term earnings at the expense of future performance and customer relationships.

How would you advise a company who is thinking of expanding globally?

When a company decides to expand globally, I strongly believe it can help the company grow exponentially. But with all possible high rewards, there comes a high risk and if this expansion is not completed well, there can be severe consequences. When it comes to global expansion there is a golden rule, which is that standardising outside of your domestic market does not always work for everything, and operations need to be managed internally and not just at the head office (Halliburton 2009). This can be called “Glocalization” which “involves taking a semi-localized approach to your already global brand” (Shinde 2019). Personally, I believe the main reasons for the approach are to adapt to cultural differences and regulations in different markets. Rigby and Vishwanath (2006) suggest variables of what, where and when to localize, such as pricing, competitor characteristics and time, respectively.

I think a company that has embraced this glocalization concept is Spotify, (a Swedish audio streaming and media services provider) one example of this is by creating special playlists for its users. More specifically, “when Singapore was affected by smoke from Indonesia’s forest fires, Spotify created a special playlist “Hazed and Confused” featuring tracks like “Harder to Breathe” by Maroon 5” (Shinde 2019). This approach gave Spotify many social shares and shows how they adapt to different cultures, countries, and situations to succeed.

However, there are exceptions where companies not using ‘glocalization’ have succeeded. I think the main example is Audi, their slogan is “Vorsprung durch Technik” meaning “Being Ahead Through Technology”. They have kept it as the German translation, so people know it is a German brand and then associate its good engineering with Audi and Germany. I think this can be effective and has worked, as German car manufacturers in general are seen for their great engineering.

A company would also have to consider both the macro-environment and micro-environment before expanding globally such as the economy and market size/growth, respectively.

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