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The industry of market research was orderly, predictable and fairly calm in the past days when professionals worked for suppliers and companies in marketing departments. These professionals worked in an environment with well defined space and roles. As such, they were specialised in research where they assessed various attitudes that affected consumer behaviour (Peck & Payne 2008, p. 13).
In addition, statistics, survey designs, voter behaviour, and sociology became an important strategy in marketing. This was followed by apprenticeships where professionals were promoted to project directors from research assistants. A bit of predictability and stability were obtained in this system of market research, but it did not last for long.
In the recent past, many organisations have experienced a growth in customer relationship management, market research, data mining, and competitive intelligence. It has become a crucial strategy for companies to clearly understand their marketing approaches as well as identify and know each of their customer’s taste and needs since this information is fundamental in marketing (Powell 2010, p. 300).
Besides, understanding the customer’s requirements helps organisations to open new markets and services that suit the needs of their clients. On the other hand, it is thought that an individual customer is equivalent to an atom of business, and a group of individuals comprise a market with huge potential for demand.
Role of Market Insights in enabling Outside-In Strategies
Insight in marketing plays an important role in shaping the strategies of outside-in companies.
Insights that are strategically useful address the real needs of the customers, identify places of weakness where other companies are likely to exploit, give possible explanations concerning customer defections and ways of retaining them, predict the likely outcome if a company cuts prices of selected products, and choose the most appropriate media to be used in marketing.
Also, these insights are valuable to a company because they assist in the development of strategic decisions regarding the outside-in companies in many ways.
To begin with, strategy decisions act as a guideline for a company to draw fact-based and practical conclusions. This is because market responses that drive the customer’s value and market structures related to competitive positions and segments are developed and used by outside-in companies through a widespread database. The factuality of these decisions results from the captured profitability of the outside-in companies.
Again, practical information regarding the market is obtained through the value that firms accord ethnographic work, which statistically analyses and predicts models (Anderson 2011, p. 20). On the other hand, the development of strategy decisions helps firms to anticipate their competitors’ countermoves and moves.
The fact that today’s world is interdependent makes it essential for a company to identify and understand its potential competitor. For example, the software game that was developed by Nintendo was an original idea of Microsoft and Sony. Nevertheless, the Wii of Nintendo provided an enjoyable experience with appealing demographics.
On the contrary, the production costs of Nintendo were less since their game lacked expensive features like those of Sony and Microsoft. Overall, this was possible because Nintendo took advantage of the closely associated operations between Microsoft’s Xbox and Sony’s PlayStation. In addition, Nintendo was aware that it was not going to face attacks from its competitors.
Furthermore, market insights develop strategic decisions that in turn connect with networked customers. This is because of promising new channels and media that have effectively increased access to customers at fragmented costs. This move has seen the loss of efficacy in traditional methods of communication such as mass media (Fiol & Marlene 2011, p. 191).
The invention of facebook and twitter has enabled firms to engage directly with customers, and this has been advantageous to firms since they understand their customer’s taste, where and when they need their products. One practical example can be drawn from Hewlett-Packard when they were designing their new entertainment laptop.
The company launched an online competition via MTV and the web, where the announcement attracted over five million hits. In fact, this latest development forced HP to reassess its sales strategy. In other words, the concept of outside-in thinking has made it easier for firms to interact freely with their customers in a productive manner.
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Finally, it is factual that a company with good insight into its market identifies and acts on growth opportunities before its competitors (Irons 2007, p. 6). For instance, the customers of Walmart Pharmacy could not afford the company’s full prescription and therefore broke the pills into half.
In attempt of utilising this opportunity, Walmart offered cheaper prescriptions at $4. Inasmuch as this prescription included generic medications, this move brought a series of customers most notably the uninsured into Walmart.
Role of Market Insights in analysing Customer Behaviour
It is illustrious that customers who belong to a particular company form its market, and it is the responsibility of these companies to decode their customer’s demand force. When a company knows its potential customers and the particular benefits they achieve from their products, it becomes easier for that company to predict and explain its performance.
It is the role of marketing units in companies to integrate all broken pieces of information regarding their customers. This information is then transformed into recommendations that are channelled into board members of a particular company for action.
In the long run, the customer’s behaviour is well understood. Thus, appropriate communication strategies between a company and its target are derived and this leaves the company in a better position to enhance trust between itself and its consumers.
In order to identify market insights, firms analyse transactional database and conduct market research. This has made it possible for companies to determine each customer’s price sensitivity, usage patterns and preferences. Hence, this information remains pivotal in retention, determination of cross sell policies and pricing of products within a company.
However, this will not be possible unless companies aim at attracting potential customers into their market through a precise evaluation of customer attitude. Presentations of market insights can be in the form of segmentations, control experiment verses test results, cause-effect relationships, rejected or confirmed hypothesis, and various scores on financial and marketing metrics.
Moreover, market strategies involve the identification of how and where to compete effectively. In order to achieve this, a proper market insight is needed to establish the customer’s taste, segments and the 4P’s. It is the synergy of technological advances, proper understanding of the market and its trends that differentiate between a successful and an unsuccessful company (Wright 2008, p130).
In line with the ongoing discussion, it is only possible for a company to set successive long term approaches if it focuses on its customers. For example, firms have been unsuccessfully struggling to assess various long term effects of their promotions.
It was until they adopted their customer’s measure of promotional activities that they were able to determine their loyalty. This way, the seemingly unprofitable promotions maintained a cheap image that in turn retained their customer’s loyalty.
Role of Market Insights in Customer Centricity
It is thought by many people that customer centricity is the process of replacing traditional product marketing strategies with current consumer trends. However, the correct definition of customer centricity is the process of balancing the requirements of the consumer with those of the company.
The term can as well be defined as the art of resisting the implementation of product strategies without understanding the real requirements of the customer. When a customer’s need is not understood, then the real importance of this customer is not reflected (McKitterick 2007, p.81). This explains why in some firms the position of the chief customer officer has been created.
The convergence of customer service, sales and marketing within a company reflect the position held by the chief customer officer. As such, the chief customer officer holds all information regarding customer insights.
This information is in turn transferred to the chief executive officers in boardrooms who then use it to draw critical business decisions. Finally, when information about customers is in the hands of the chief customer officer, it is likely to be taken seriously.
Role of Market Insights in Dealing with Abundance and Automation
In the present world, the sources of market insight are more than in the old days. This is because of advanced technology that provides massive volumes of instantaneous feedback. The information that is hidden in this feedback is then decoded using digital technologies (Guthrie 2010, p. 30). This explains why many firms that operate on real time database are able to make instantaneous but well informed decisions.
It is not by surprise that firms of the gone days would not have passed most compliance tests such as the YK2. For example, in the golden age of database update through direct mails, it would have taken a firm at least three months to establish if its campaign was successful or not. Technology has made it possible for firms to judge an email campaign almost immediately after deployment.
It is also advantageous for companies to change the content of the campaign should they want to, assess the deliverability of their mails, determine the rates at which their mails are opened, and determine the actual number of customers who convert the mails into purchases.
Furthermore, customers no longer queue outside customer care centres for their issues to be solved, rather they tweet their feelings. Also, it is possible to start online community forums that involve even the uninterested individuals since all they need to do is to embellish their personal observations.
It is the role of insight in marketing that has enabled firms to have abundance of data regarding their products. Technology plays a major role in data collection, handling and processing resulting to appropriate conclusions (Davis 2009, p. 65).
The role of insights in marketing has resulted to automation of operations in many companies. This is possible because of broadening market trends and the complicated nature of the market. Despite the fact that the scarcest resource is human capital in any marketing unit, it is common nowadays for companies to harmonise repetitive tasks (Kotler 2008, p. 30).
Savings resulting from the freed up human capital are reinvested in qualitative initiatives. In other words, when a company automates most of its operations, it becomes obvious that a spare resource is created. This spare resource plays a role in ensuring that most of the issues in market insight are addressed.
This is the same scenario in RAPP, a company that has embraced the t-shape technology. Here, candidates with the capacity of widening their knowledge but with specialisation in a particular field are employed.
In the past, most companies focused on marketing their products to consumers without paying attention to their needs. This marketing was done by professionals whose work was relatively predictable. However, companies have realised the important role played by customers within today’s competitive market. Thus, it has become relevant for these companies to come up with strategies that make their business lucrative.
As firms come up with strategic objectives, it becomes imperative that they include customers since they play a critical role in the marketing sector. Besides, when a company understands its market well, it is able to strategise on how to overcome the consistent threats that other companies present. Again, it becomes easy for a company with good insight into its market to understand the behaviour of its customers.
This is advantageous because a sense of common understanding and trust is generated between such a company and its target. On the other hand, excellent market insights play a significant role in the establishment of customer centricity and in dealing with automation of operations in places of work.
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