Unit 41 Contemporary Issues in Marketing Management Solution

Programme	Diploma in Business
Unit Number and Title	Unit 41 Contemporary Issues in Marketing Management
QFC Level	Level 5
Credit value	15 credits
Unit Code	K/601/1037

Task 1

Introduction

Core purpose of this Unit 41 Contemporary Issues in Marketing Management Solution report is basically to analyse, discuss and interpret various contemporary issues which are faced by business organisation in the process of marketing management (Gentry, 2014). Marketing management can be defined as a business function or area within a business which is focused on practical implementation of marketing techniques and the management of an organization’s marketing resources and activities (Lin, 2014). On other hand relationship marketing can be defined as a form of marketing which is developed on the basis of direct marketing campaigns, and the focus remains on understanding customer requirements, their satisfaction factors etc. Relationship marketing is much different form the typical focus on increasing sales transactions. With changing times, there has been tremendous focus on the concept of relationship marketing and its impact on marketing management. This report will analyse various aspects such as understanding the importance of relationship marketing in a contemporary business context, importance of applying extending marketing mix in the service sector, and then finally examination of reasons related to emphasis on ethics and social responsibility as part of marketing management process (Zeng et al, 2003).

1.1 Concept of knowledge management and its role in relationship marketing

Over last few years knowledge management (KM) has acquired an important position in the overall business strategy of enterprises across the world. KM in context of an organisation can be defined as a process where organisational knowledge is acquired, developed, discussed and shared within the boundaries of an organisation. KM to a large extent can be considered as an approach which is multidisciplinary in nature can covers various business functions of an organisation and ultimately enables the organisation in achieving its goal in productive and effective way. Thus through an effective KM, an organisation can ensure that all the information related to its customer can be converted into knowledge which can be created, acquired, captured, shared and used in an effective manner, so that knowledge of organisation about its customer increases more. It can be said that KM in a way makes an organisation intelligent and help them in understanding the requirement of their customers which is one of the core fundamental of the relationship marketing (Hsu & Chi, 2014).
As discussed in above section, that relations marking is majorly focused on customer retention, satisfying them with services etc. In order to achieve this organisation and especially its marketing principles, sales and market research team needs to gather sufficient knowledge about their customer. This management of knowledge can be effective only when a proper KM framework is implemented. That is why with increasing focus on relationship marketing, there has been equal focus on the concept of knowledge management as well since both of them are closely associated with each other, and to large extent complement it each other.

1.2 ICT and ways it supports customer relationship management (CRM)

Similar to knowledge management role in relationship marketing, today event information and communication technologies (ICT) are playing an important role in improvement of customer relationship management (CRM).  CRM can be defined as process or a concept where organisations focus on management of various aspects related to its customer. Identification of a potential customer, converting it into a customer and till the time customer moves away from the company, CRM concepts are applied to boost the overall customer experience with the organisation. In improving the customer experience ICT has played major role. Today concepts of CRM are being implemented in organisations through various ICT tools and applications.  For example banks telecom companies like Vodafone have dedicated CRM software applications which helps them to service its customer, and also target new customers, today’s CRM applications such as Siebel CRM, Zoho CRM are highly robust in nature, which means they can track each and every activities of a customer in context of the organisation (Drnevich & Croson, 2013).Thus, when a customer calls up a Vodafone call centre, then even before tele operator picks the call, he/she is aware of the customer name, and his complete information such as bill plan etc. Which means that by the time call connects, tele operator is already in a comfortable position to answer some of the basic queries form the customer, and in any other case has all the relevant information readily available. Thus by integration of CRM applications with present communication technologies organisations such as Vodafone are reaping benefits in terms of high rate of customer satisfaction etc.

1.3 Benefits of customer relationship management in Vodafone

Even though ICT has played major role in the integration of CRM concepts in the organisations such as Vodafone, however it is also important to analyse the various benefits which CRM has bought to Vodafone. Today due to use of CRM applications, Vodafone has every possible information relations to its customer, and accordingly it can up-sell any particular voice or data plan to its customer. More importantly, CRM applications provide capability to the business to analyse the trend such as monthly bill of a customer, or data usage of the customer, and accordingly it provides a trend analysis for that particular customer. Such aspects have helped Vodafone to tailor-made voice and data plans and launch frequently in the market. It can be said that CRM has enabled Vodafone to become more flexible in addressing its customer demand, complain etc. CRM has also enabled Vodafone in effective retention of its existing customers. At times when a customer might indicate his willingness to switch from Vodafone to any-other company, then Vodafone can offer him a plan which fulfils his requirement to large extent. CRM also helps the company to keep a check on customers who are loyal and have been associated with the company since long, and reward them accordingly. Another important benefit which CRM has bought to Vodafone is its impact on the marketing and sales of the company. With CRM marketing and sales team get real time information and accordingly they can target a potential customer, or they can upsell their services to an already existing customer. Thus it can be said that CRM to large extent has impact on multiple areas in the business, which improves overall business efficiency and performance.

1.4 Recommendations for the improvement in customer relationship management for Vodafone

In above section it was discussed about KM and impact on relationship marketing, and then it was further discussed about ICT and its impact on CRM, and then how CRM is benefitting Vodafone.  Even though CRM strategy has helped the organisation to a large extent, but there are still numerous aspects where there can be improvement s in the CRM strategy of Vodafone. Firstly, CRM Strategy of Vodafone is majorly push in nature, which means CRM strategy is such that it is Vodafone which pushes numerous types of information etc. towards its customer. Ideally CRM strategy should enable a two-way communication where both customer as well the company are closely integrated with each other and have a two way communication, where even customer has opinion about the services offered by the company. Currently, Vodafone keeps flooding SMS to its customer especially in pre-paid connections with various offers etc. This-some customer might find as intrusive in nature. That is why it is important for the company to rectify this strategy (Mithas et al, 2012).
Another important recommendation for the improvement of the CRM in Vodafone is deploying the CRM application on the cloud. Today cloud computing has removed the need of maintaining an entire hardware facility within the company premises.

Conclusion

Thus as an organisation Vodafone can move its CRM strategy towards cloud. Which means information related to customers will be available at any point of time, irrespective of the fact that what time of a day it is, this provides flexibility to even sales and marketing team, who can access the readily information related to customers on handheld devices, such changes will ensure that CRM in Vodafone is comprehensive in nature, and presents the complete picture of the available customer information.

Task 3

3.1 Use of extended marketing mix

Marketing mix is an important marketing tool for any marketing department of an organisation. It can be defined as a combination of several marketing activities in which organisations might engage, so that it can successfully achieve the requirement of its target market. Marketing mix basically consists of four important elements such as:

• Product
• Price
• Place
• Promotion

However over last few years since marketing has become more customer oriented, thus in above four Ps, now there are three more Ps, which has extended the marketing mix. These Ps are (Kleis et al, 2013).

• Physical layout: During time period when manufacturing industry dominated the global economy, then there was not much focus on the physical layout of the store of unit were products were placed. However, today physical layout plays a major role in boosting the overall attraction of the customer. For example KFC (Kentucky Fried Chicken) which is fast food chain ensures that its physical layout of store is attractive and has a common theme across its entire store in world. This helps in delivering a unique but uniform experience to its end customer.
• Provision of customer services: KFC in its store has ensured that all its employees handling the order counter are courteous to its customer and always keep a track of customer preference. This ensures that a superior customer service is delivered in the end. It also has special customer grievances cell, where if any customer finds any sort of issue with products sold by the company, then it is addressed promptly. 
• Processes: There are several processes which are associated with the way customer servicing is done. For example, KFC has complain box in its store, and it also has feedback collection mechanism enabled on its official website, where a customer can just provide his feedback. Such kind of processes provides the end customer flexibility.

3.2 How the product/service mix can be used toenhance value for the customer and organisation

Product/Service mix plays an important role in boosting the overall value of the product and organisation for the customers associated with the company. As discussed in above section, product mix basically consists of product, price, place, and promotion, whereas service mix focuses more on the service aspect of the business where it adds aspects such as people, processes and physical layout. If used strategically, product as well as service mix can add significant value to the business in following ways:

• Product/service mix focuses on interest of the customer, and ways through which more and more customers can be attracted to the business. Hence, it improves the overall revenue of the organisation if more customers are attracted to the business.
• As part of the service mix efforts, organisations always keep a close track of the customer requirement and behaviour. This provides the organisation flexibility, where it can adapt itself quickly to any sort of the change in customer demand.
• Product/service mix focuses on the value addition to the services provide to the customers of the organisation.

3.3 How difficulties peculiar to the marketing of services can be overcome

Marketing of services at times can be tricky for an organisation and can pose numerous challenges in front of the organisation. It is important to understand that when an organisation provides a service then there are several characteristics to the service such as variability, intangibility, inseparability and inability to transfer the ownership of service. These characteristics are some of the major aspects due to which service based organisations such as Vodafone or KFC face difficulty in their marketing efforts and activities (Christophee et al, 2013). For example, when KFC started its operations in India, there was lot of pressure on its quality of product as chicken which used in the product was highly processed in nature. Similarly price factor was another major aspect where people initially were sceptical to buy the products from KFC. Thus over a period of time KFC conducted several rounds of market research in order to have a better understanding of the local taste and market demographics. Based on which KFC accordingly reshuffled its menu and included vegetarian items as well, and pricing strategy was also in sync with the market sensibility of the market.  Another major issue faced by KFC was marketing of the quality of service, which was experienced only when a customer visited the store. Hence due to word of mouth and positive reviews of the quality of services, KFC not only gained respect in terms of quality of its product but was also able to attract much more customers than anticipated.

3.4 Role of IT in services marketing management

Information Technology has major role in marketing especially in a virtual organisation such as www.amazon.com. Amazon is an online retailer which is one of the biggest in the world today. This position which amazon has achieved is on the basis of its IT strength. Amazon uses IT applications extensively in its marketing efforts as well. For example, it uses mediums such as e-mails to regularly communicate with its customers and inform them about any new deal or offer. Similarly, on various websites, advertisement of products etc. is done through online banner or flash, hence when a user clicks those banners etc. then user is directed towards Amazon’s website. Most importantly, Amazon’s entire business is dependent on its e-commerce website, which also doubles up as its marketing tool as well.

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Task 4

Introduction

Ethics and social responsibility has always remained one of the focus areas of the businesses. Especially when it comes to marketing, role of ethics and social responsibility becomes even more important. Majority of times, marketers face ethical dilemma in their marketing activity, which creates lot of issues for the organisation. That is why, companies today have become extra careful about what product they are manufacturing and selling, and whether that product has any negative impact on the society or not. It can be said that ethical and social responsibility to a large extent also impacts the image of the company, hence it important to analyse the reasons for increasing emphasis on ethics and social responsibility as part of the marketing management process.

4.1 Current issues of ethical and social concern to marketers in a particular industry

Some of the current ethical and social concern to marketers in the service industry is as follows:

• Often it has been seen that a particular service might have some negative impact on the customer but still the product has to be marketed. For example, everyone is aware of the ill effects of junk foods, however marketers put their best foot forward when they promote fast food such as burgers sold from KFC or McDonalds.
• Service industry also has major social concerns. Since service industry does not produces any tangible product, hence in that using a service such as banking service for social responsibility can be extremely difficult.
• Often there are cultural impacts as well due to ethical and social concerns. For example, company such as Burger King, which it enters a country like India, then immediately it has stopped selling beef or pork burger due to cultural sensitivity of the region in which it operates.

4.2 Concept of CSR with reference to Vodafone

Corporate social responsibility is one major aspect of a business. It ensures that company is not only focused on earning profit and increasing its revenue but is also focused on giving back certain extent of its revenue for society development. In this regard Vodafone as a robust CSR unit which takes care of various CSR programs such as education of children in selected region of India and other developing countries it operates. CSR also is an important channel for Vodafone through which it engages with its customers, and other people of society who might need help from the company. Similarly, Vodafone from time to time keeps launching initiative such as Cancer reduction initiative etc. Thus it can be said that CSR gives a chance to the organisation to include the social element in the overall business of the organisation.

4.3 Role played by a selected pressure group in influencing ethical and social marketing policies

In a changing business environment, no company can take its place guaranteed. However this becomes even truer, when it comes to influencing the ethical and social marketing policies. For example recently in Asian countries such as India it was found that in Coca Cola, there is high level of traces of insecticide and pesticide in its product. This research was conducted by one of the leading organisations in India. Hence this organisation played a typical role of governing agency which analysed and publicly released the data which also impacted the sale of Cocoa Cola for. Such kind of pressure groups basically ensure that all the public activity of the company remains under the radar, and in case of any trouble, misappropriate, or  misinterpretation these peer groups act proactivity and highlight the issue.

Conclusion

One thing which is sure is that in coming few years there will be increasing stress on the CSR related activities, and sorting out the ethical and social dilemma. Both service as well as product based companies have to be extra careful in selling their products in the market, and should also ensure that their product or service should not breach the morality and ethical framework under which the society lives.

References

Drnevich, P. L., & Croson, D. C. (2013). Information technology and business-level strategy: toward an integrated theoretical perspective. MIS Quarterly, 37(2), 483-509.
Gentry, J. W., Macintosh, G., Stoltman, J. J., & Wilson, K. (2014). Implications of the trend toward relationship marketing for experiential learning. Developments in Business Simulation and Experiential Learning, 21.
Greenberg, P. (2010). The impact of CRM 2.0 on customer insight. Journal of Business & Industrial Marketing, 25(6), 410-419.
Hsu, Y., & Chi, C. J. (2014). The Comparative Influences of Relationship Marketing, National Cultural values, and Consumer values on Consumer Satisfaction between Local and Global Coffee Shop Brands. International Journal of Business & Commerce, 3(8).
Kleis, L., Chwelos, P., Ramirez, R. V., & Cockburn, I. (2012). Information technology and intangible output: The impact of IT investment on innovation productivity. Information Systems Research, 23(1), 42-59.
Lin, C. C. (2014). The Impact of Relationship Marketing and Sales Promotion on Customer Loyalty: The Cases of Counter Cosmetics Brand.
Mithas, S., Tafti, A., Bardhan, I., & Goh, J. M. (2012). Information technology and firm profitability: mechanisms and empirical evidence. Mis Quarterly, 36(1), 205-224.
Zeng, Y. E., Wen, H. J., & Yen, D. C. (2003). Customer relationship management (CRM) in business-to-business (B2B) e-commerce. Information Management & Computer Security, 11(1), 39-44.