MARKETING AND THE ORGANIZATION'S PURPOSE

You will understand: The purpose of an organization is to get and keep customers. To keep customers you must deliver valued services, at attractive prices and conditions, to enough customers to make those prices and conditions possible.

The Marketing Concept: Operationalized Focus on customers who comprise a target market Identify markets to be satisfied Create products that satisfy

The Marketing Concept: Defined Creation of value for customers by means of the product and every aspect of its enjoyment and use, acquisition, and production.

Determinants of Customer Delivered Value Product value Services value Personnel value Image value Monetary cost Time cost Energy cost Total customer value Total customer value Psychic cost Total customer cost Total customer cost Customer delivered value Customer delivered value

Value Chain or Value Delivery Network – Primary Activities: Inbound Logistics Operations Outbound Marketing and Sales Service – Support Activities Firm Infrastructure Human Resource Management Technology Development Procurement

Value Chain or Value Delivery Network Primary Activities Support Activities Firm infrastructure Human resource management Technology development Procurement Inbound logistics Outbound logistics Marketing and sales Service Opera- tions

Levi Strauss’ Value-Delivery Network Order Du Pont (Fibers) Du Pont (Fibers) Milliken (Fabric) Milliken (Fabric) Levi’s (Apparel) Levi’s (Apparel) Sears (Retail) Sears (Retail) Competition is between networks, not companies. The winner is the company with the better network. Customer Order Delivery

Adoption of the Marketing Concept by Business Consumer goods manufacturers first Services next Commodity goods manufacturers someday

Adoption of the Marketing Concept in Government: NPM A bold use of market-like mechanisms for those parts of the public sector that cannot be transferred directly into private ownership Intensified organizational and spatial decentralization of the management and delivery of services A constant rhetorical emphasis on the need to improve service quality An equally relentless emphasis on customer satisfaction

Marketing Concept Spreading rapidly throughout the world

Societal Marketing Concept T he organization’s task is to determine the needs, wants, and interests of target markets and to deliver the desired satisfactions more effectively and efficiently than competitors in a way that preserves or enhances the consumer’s and the society’ well-being.

Hurdles to Adopting Marketing Concept Organized Resistance - people in some departments see marketing as a threat to their power in the organization Slow Learning - organizational learning comes slow Fast Forgetting - there is a strong tendency to forget marketing principles