Concept of Internal Marketing in Business Analytical Essay

The issues of marketing can be applied to all types of business with regard to the size and specialisation. However, the approach is different for large and small businesses due to the manner of application. For instance, the manager of a small hotel/motel would not make plans for future marketing interventions and actions to be made unlike the large hotels that have strategies concerning the training of staff members, recruitment, development, and other important aspects.

In this respect, the marketing in large companies is well-planned and includes more long-term goals to be attained whereas the small companies rely more on the short-term attainable goals that do not require a strategic approach. As reported in the article by Reijonen and Laukkanen (2010), there should be some guidelines for marketing strategies related to small enterprises because most studies are aimed at providing large companies with sufficient theoretical background concerning the marketing approaches, the best practices, and other issues.

Limitation is one of the reasons why small firms have marketing strategies that differ greatly from those of the large companies. As such, time and resources as well as training level and knowledge management issues are limited for small companies due to the insufficient capital and the overall size of the firm.

However, there are some fields of marketing applied to large and small companies evenly: “segmentation, customer orientation, targeting, positioning, and seeking for competitive advantage” (Reijonen & Laukkanen, 2010, p. 115). For instance, segmentation applied to small firms is considered to be really challenging because it is aimed at dividing the entire scope of potential customers into groups in accordance with certain principles and characteristics.

As claimed by Storbacka (1997 in Reijonen & Laukkanen, 2010), the outcomes of the segmentation as a part of marketing is “to increase the profitability of the enterprise” (p. 116). So, the process of segmentation should be applied to small businesses as an integral part of the marketing strategies.

The behavioural characteristics of the population are considered to be the major principle according to which companies shape their segmentation and placement strategies as well as the overall marketing aimed at increasing profitability, improving the quality, and approaching the customers in the most appropriate way.

As such, different information systems are used to collect and process information for further application; the information about customers includes attitude towards brands, reputation, colours, perception of different slogans, and many other details that contribute to the application of effective marketing strategies by companies.

For instance, ‘knowledge-based marketing’ is designed in order to meet the needs and expectations of customers, gain new customers, and attract customers that may use other brands. In this respect, information about customers and their purchasing habits is of great importance for companies. As applied to customers, segmentation techniques can include some customized products and services targeted at existing and potential customers such as special offers, discounts, and gifts.

Differentiated marketing activities used for improvements in the services and products the company produces can be carried out with the help of segmentation. Price and quality ratio can be considered one of the major principles of segmentation when applied to small businesses.

At the same time, social groups and preferences typical of representatives of certain social groups are another criterion for segmentation strategies implemented by small businesses. Creation of value in business is another concept that helps to differentiate the company from competitors and select the right strategies for marketing purposes.

As such, production and commerce are claimed to be the basic ways for creating value while the value of the company’s products/services directly influences the behavioural attitudes and consumption habits. Competitive advantage is one of the principles common for large and small businesses as a part of marketing strategies; it can be gained through value-creating as well as brand loyalty.

Understanding the value of the company and its products/services is essential for a manager as he/she is responsible for implementing marketing techniques that are aimed at increasing the value thus helping to gain competitive advantage.

Perception of a product/service by customer in terms of value is related to the analysis of the value by customer with regard to the direct benefits. As such, the study by Reijonen and Laukkanen (2010) focuses on the necessity of differentiating the value and making differences for different customers.

In other words, a hotel manager should not take the approach of offering everything to every customer because some exclusive offerings should be aimed at creating value. For instance, if a service is offered to all customers, it becomes a distinctive feature of the company or one of its brands while offered to certain category of customers, a service may create value that would increase the competitive advantage of the company.

Information about markets and customers is the major aspect on which the further planning should be based because a company cannot decide what services/products to offer without knowing anything about the customers’ needs and competitive advantage of the rivals.

A narrow segment of population is usually targeted by small companies that have limited resources and are not able to meet the needs of all categories due to lack of resources. Differentiated marketing activities can be applied to small businesses though there is little evidence of their effectiveness.

Small businesses have other marketing strategies than large companies because they have limited resources and should apply what they have to improve their performance. In this respect, internal marketing is one of the greatest strategic approaches that can be implemented to enhance positive effects of external marketing strategies such as segmentation and differentiated activities.

For instance, as suggested by Burkitt and Zealley (2006), employee and customer retention is one of the positive effects of internal marketing because employees become aware of the necessity of changes and cooperate with managerial on all levels while customers perceive changes and rate the services accordingly.

One of the areas where internal marketing techniques can be really effective is the small five-star hotel or motel. As such, it is necessary to outline the major areas and aspects to which the internal marketing techniques can be applied to a small five-star hotel. Employees and their role in the company should be considered while implementing internal marketing activities.

Knowledge and active involvement of the workforce in service delivery improves the firm’s brand (Ahmed and Rafiq, 2004) while the training and open access to information necessary for work improve the employees’ performance and empower them for completion of more challenging tasks. Besides, small firms have a low employee retention percentage and this may hamper internal marketing since new staff will have to be trained as they come in to replace others that have left (Ahmed and Rafiq, 2004).

As a contrast, large firms, are better placed at using internal marketing due to their large staff (Ahmed et al., 2003), large clientele base, and their more permanent staff (Ballantyne, 2003). So, different interventions should be introduced to improve the relationships between the employees, employees and managerial, employees and customers, enhance the understanding of strategies and necessity of changes by employees, which may lead to active cooperation.

Both SMEs and large firms can benefit from internal marketing by educating and training their staff on the firm’s culture (Ahmed et al., 2003), structure, products, and services (Ballantyne, 2003). The goals should be set and attained to improve the services and maintenance of a small five-star hotel/motel. It is necessary to understand the potential customers and their needs and try to satisfy their needs at an affordable price.

In other words, use of resources should be optimized in order to reach the desired effect (Rafiq & Ahmed, 2003). As suggested in the study by Jakle, Sculle, & Rogers (2002), cleanliness and price are the main factors in accordance to which people use motels (p. 9). However, another approach should be taken into account while using a small five-star motel/hotel.

The emphasis is on the rating and on the size of the place. As the procedure of internal marketing is aimed at aligning, motivating, and empowering employees at all managerial levels to deliver a quality customer experience (Ballantyne, 2003), it is necessary to bring the issue of employees and training as well as empowering first.

Services and their quality are sure to be better in businesses where employees clearly understand the outcomes of their actions and realise the importance of being polite when required. This will influence how external customers perceive the firm (Ballantyne, 2003; Rafiq and Ahmed, 2000). For instance, if a person books a room in a small five-star hotel/motel, he/she wants a clean tidy room, polite staff, and everything for what the customer is ready to pay.

References

Ahmed, P. K., & Rafiq, M. (2004). Internal marketing: tools and concepts for customer-focused management. NY: Elsevier.

Ahmed, P. K., Rafiq, M., & Saad, N. M. (2003). Internal marketing and the mediating role of organisational competencies. European Journal of Marketing, 37(9), 1221-1241.

Ballantyne, D. (2003). A relationship-mediated theory of internal marketing, European Journal of Marketing, 37(9), 1242–1260.

Burkitt, H., & Zealley, J. (2006). Marketing excellence: winning companies reveal the secrets of their success. Hoboken, NJ: John Wiley & Sons Ltd.

Jakle, J. A., Sculle, K. A., & Rogers, J. S. (2002). The motel in America. Baltimore, MD: Johns Hopkins University Press.

Rafiq, M., & Ahmed, P. K. (2000). Advances in the internal marketing concept: definition, synthesis and extension. Journal of Services Marketing, 14(6),449–462.

Rafiq, M., & Ahmed, P. K. (2003). Internal marketing issues and challenges. European Journal of Marketing, 37(9), 1177–1186.

Reijonen, H., & Laukkanen, T. (2010). Economics and Customer relationship oriented marketing practices in SMEs. Marketing Intelligence & Planning, 28(2), 115-136.