COMPETITOR ORIENTATION AND CUSTOMER ORIENTATION

Kotler and Armstrong (2010) highlighted through the “Chipsy” story in Egypt that product creation and effective marketing program starts from a deep understanding of customer wants and concerns. It also mentions that companies must be innovative to differentiate themselves from their competitors. The race for competitive advantage is actually a race for customer and market insights and at the same time marketing intelligence has grown as more companies are now busy snooping on competitor activities through several activities such as internet buzzes, quizzing company employees, bench marking competitors’ product etc.  A company might therefore decide to either focus on competitors or its customers as situations might dictate, or else might attempt to balance both approaches.

A company with the customer orientation is that which places emphasis on customer interest, wants and preferences. Richard Hiens (2000) mentions that firms like this emphasize customer focused intelligence activities at the expense of competitor information and as such are referred to as “customer preoccupied”. Customer orientation simply means in-depth understanding of the customer and continuously providing value for them (Lafferty and Hult, 2001) and this remain key to the success of any customer oriented business. In this approach to doing business, not only would customer needs and interest be appreciated, his entire value chain, his perceived sacrifices and continuous communication with actual and potential customers is the highlight.

Competitor orientation on the other hand uses target rivals as a frame of reference (Robert Hiens, 2000), they seek to identify their strengths and weakness as it relates to their rivals . Porter (1980) mentions that close monitoring of competitors is quite a difficult task but at the same time remains relevant in a hostile business environment.

Most researches (Kohli and Jaworski, 1990; Lusch and Laznak, 1987; Slaver and Nater, 1994) have come to deviate from conventional ideas of the customer focused marketing proponents (a satisfied customer is the main objective of business); to embracing a broader perspective on the orientation construct to include “exogenous factors” that influence customer needs such as competitors and even government regulations (Robert Hiens, 2000). Citeman network gives a descriptive analogy of situations in companies with the 2 orientations

Competitor oriented Telecommunication Company

Situation

• Company X in Germany is going all out to crush us in the GSM market
• Company Y in Spain is increasing its network coverage to reach rural colonies on the boundaries on the country
• Company Z in Italy has cut down call rates and we have lost 3 share points
• Company P in Portugal has introduced the dot.me application on its network and we are loosing clients.

Reactions

• We withdraw from Germany because we cannot afford to take on the market leader in such a war
• We increase our advertisement and promotion expenditure in Spain
• We meet competitors call rates slash in Italy
• We increase R&D expenses in Portugal to develop a similar feature like that of our competitor but with slightly better service.

Such an approach has its advantages and the same time disadvantages. It portrays the company has a fighter organization and keeps employee alert on competitor weaknesses and introduced change. On the other hand, too many resources might be spent on competitive investment rather than investing on breakthrough innovations. Such organizations do not move towards their own set goals but rather tailor goals to competitor actions.

Customer oriented Telecommunication Company

Situation

• The total market grows at a rate of 5% annually
• The reception quality sensitive segment grows by 10% annually
• The promotion prone segment is growing fast but such customers do not stay long on the network
• A growing number of customers are interested in network compatible social networking hubs on their receivers.

Reactions

• Change of focus to improving service quality, increase network coverage, install more cell sites and shift advertising theme to service quality
• Reduce promotions and deals because we do not want to acquire customer loyalty this way.
• Invest in 4G network and develop add-ons that could aid the social hub applications on the network

As seen above, the customer oriented organization is rightfully positioned to identifying opportunities and as such increase performance and increase customer satisfaction but they could at the same time due to their emphasis on customers lose sight of changes introduced by competitors. Customers are known to be resistant to change and in most cases this forces such organization to maintain status quo thus refraining from game changing innovations.

Companies must understand that there is a tradeoff between the two orientations and the ideal option is to balance both perspectives. A balance of both is important because complete reliance on either can often lead to an incomplete business strategy, leaving an organization handicapped by a reactive poster (Day and Wensley, 1988); in other words “ a partial and biased picture of reality”. It is necessary to balance both perspective so that a firm can find sufficient flexibility to shift resources between customer and competitor emphasis as market conditions change (Robert Hiens , 2000; Slater and Nater, 1994)

References

Kotler and Armstrong (2010). The principles of marketing. Pearson education. Newyork 13^th ed

Lafferty, Barbara A.; Hult, G. Tomas M. (2001): “A sythesis of contemporary market orientation perspectives”, European Journal of Marketing, 35 (1/2), 92-109.

Richard Hiens (2000). Market Orientation: Toward an Integrated Framework. Academy of Marketing Science Review  Volume 2000 No. 1 Available: http://www.amsreview.org/articles/heiens01-2000.pdf Copyright © 2000 – Academy of Marketing Science

Porter, Michael E. 1980. Competitive Strategy. New York: The Free Press

Kholi, Ajay and Bernard J. Jaworski. 1990. "Market-Orientation: The Construct, Research Propositions, and Managerial Implications." Journal of Marketing 54 (April): 1-18.

Lusch, Robert F. and Gene R. Lazniak. 1987. "The Evolving Marketing Concept, Competitive Intensity, and Organizational Performance." Journal of the Academy of Marketing Science 15 (Fall): 1-11.

Slater, Stanley F. and John C. Narver. 1994a. "Does Competitive Environment Moderate the Market OrientationPerformance Relationship?" Journal of Marketing 58 (January): 46- 55.

Citeman network (1996). Balancing customer and competitor orientations. Available online from: http://www.citeman.com/1074-balancing-customer-and-competitor-orientation/

Day, George S. 1994. "The Capabilities of Market-Driven Organizations." Journal of Marketing 58 : 37-52.

Robin Wensley. 1988. "Assessing Advantage: A Framework for Diagnosing Competitive Superiority." Journal of Marketing 52.  1-20.

impact of culture on marketing

CULTURAL IMPACT ON MARKETING

Most organizations that are consumer-oriented are said to be cultural bound. This to great extent is true because consumers of such products are members of certain cultural groupings and inclinations irrespective of their stages in life (P.P. Ekerete, 2010).

Culture in itself has come to have several meanings and while some basically would describe it in association with self comportment and well behavior, others would describe it in association to traditional beliefs, festivals and masquerade dances (particularly in the African context). ” Howard & Sheth (1969) describes culture as the “collective mental programming which people in a society have so that an individual’s behavior might be determined by his cultural background. Ekerete 2010 also emphasizes that culture is not only a narrow view of man’s activities based on individual experiences , but extend to include all the activities which characterize the behaviour of particular sets of people—the way they eat, how they talk, look and general behavioral pattern which might also include what they buy and how they buy it.

Culture in itself carries some important elements and according to Carter (2002) would include language, religion, values and attitudes, education, social organization, technology and material culture, law and politics etc. and for these reasons culture in itself remains a challenging element in the international marketing place. Companies such as nestle, shell exploration, KFC etc carry out business globally and as such must study the peculiar environment they find themselves with respect to the good and services they offer.

A close look at language (verbal and non verbal) as an element of culture would give better meaning to the topic at hand; For example: the Pepsi slogan "Come alive with the Pepsi Generation" when translated to Taiwanese, sounded "Pepsi will bring your ancestors back from the dead” or the Kentucky Fried Chicken slogan "Finger-lickin’ good" in Chinese, came out as "Eat your fingers off." (www.asianjoke.com), the wrong messages can be sent to the society thereby frustrating the market of the product being offered and does not sell the brand of the company offering it.

It is also important marketing organization should also identify differences in shared belief as regards to religion. For example, certain Christian sects in Nigeria do not allow their women wear trousers, so marketing “jeans trousers” to such a community of women would be a waste of resources and would definitely not speak well for the organization as this set of people view women wearing trousers as prostitutes.

Nadine Freitag (2005) rightly puts it that values and attitudes can affect acceptance of a product or the reaction to its origins. For example, a firm using yellow flowers in its logo or on the packaging of a product was well accepted in the United States but was a disaster in Mexico, where a yellow flower symbolizes death or disrespect. (Kotler and Armstrong, 1999). Such situations change the marketing orientation of an organization.

As described in the paragraphs above, cultural environment affects and determines the way people do things, what they buy and how they buy it which in turn has an effect on the marketing activities. Let’s take clothing as an example. As earlier mentioned, certain groups of Christian women in Nigeria consider trousers as a clothing for prostitutes, miniskirts are an abomination to Arabic women that are required to cover all of their bodies when they step out in public. In such instances, marketing activities are definitely altered because normal product promotion and sales need to be change to meet the target market. Also note that in the politics as an element of culture could also affect the acceptance of products by a particular group of people as seen in the case of the Arabic man and western education, an Arabic man might not be readily receptive to the idea of wearing a suit and tie or a jean and t-shirt.

Culture is an important consideration to be looked at by global corporations, there will always be a need to tailor marketing strategies and campaigns to the the peculiar target society.

References

Umoren (1996). Anthropology Contextualised in Nigerian Peoples and Culture. An

Unpublished Monograph, RSUST, Port Harcourt.

Howard & Sheth (1969). The Theory of Buyer Behavior. John Wiley & Sons, NewYork

P.P. Ekerete (2001). The Effect of Culture on Marketing Strategies of Multinational Firm. African Study Monographs, 22(2): 93-101, July 2001

Neidine Freitag (2005). Critical The Impact of Culture on International Marketing Plans and Review of the French Wine Industry. Available online from: http://www.grin.com/en/e-book/48094/critical-the-impact-of-culture-on-international-marketing-plans-and-review

Kotler and Armstrong (2009). The principles of marketing. Pearson education. Newyork 13^th ed

consumerism and environmentalism

Consumerism and environmentalism

Consumerism has been described as the behavioral value that places importance on material possession and the pursuit of personal wealth (Fournier and richens, 1991). Even though these behaviors have been closely linked to cultural values (Mukerji, 1983), researchers have also studied how they manifest as individual traits and levels (Kasser and Kanner, 2004). Consumerism from the view of an organization can thus be described as an organization of people and government to improve the rights of buyers in relation to sellers. In this sense, it is a set of policies (honest packaging and advertisement, product guarantees and improve safety standards) aimed at regulating the products, services, methods and standards of manufacturers, sellers and advertisers in the interest of the buyer. So that an organization that focuses on consumerism would use established policies to promote interest of consumer in a particular product line. Victor lebow (1955) mentioned that such organizations would promote that we make consumption our way of life, which we convert buying and use of goods into rituals and that we need thing consumed, burned up and worn out at an ever increasing rate (Victor Lebow, 1955)

Environmentalism on the other hand has been described as the behavioral value that places importance on the environment and the effect of human activity on its wellness. While lack of environmental care and focus are associated with the consumerism values, empathy and concern for the planet are paramount to environmentalism.

Presently, the rate of consumption seems to be at an alarming increase as consumers increase their spending power and keep buying so as to keep up with others and due to this there is also corresponding imbalance on earth and its resources that has now become obvious in climate change and environmental degradation, by so saying that environmental degradation is the important effect of consumerism.

I am of the opinion that it is possible for an organization to share its focus between consumerism and environmentalism. I have seen close concepts in corporate social responsibilities, ethical consumerism and societal marketing. This three concepts share a little bit of objectives with environmentalism as they jointly believe in their responsibility to the environment and the society. A merger of consumerism and environmentalism would mean a change in product lifecycle models. Although the process of transforming consumers to make responsible might look counter-intuitive to many business models, but sometimes it is necessary to make such tough decisions to benefit the wider society. For organizations to adopt both concepts it could work in two ways; encourage consumers to buy less and do more with what they have and the use of sustainable designs and recyclable products. While the former sounds unequivocally paradoxical, the latter is more rational and reasonable.

An organization that seeks to merge both concepts can simply adopt one of the following approaches;

• ·                     System approach to sustainable design

Design components that can be easily assembled and dissembled, rather than change an entire product, internal components can be changed and upgraded e.g. an old desktop computer

• ·                     Recycling

The use of recyclable products e.g. recyclable bottles and packaging in beverages

• ·                    Durability

Increasing the durability of product would increase its life and as such consumers do not have to keep buying new ones.

• ·                     Sustainable design and ethical marketing

Encourage the need to change products based on its wider effect and benefit on the environment

Contrary to believe, environmentalism is not against marketing and consumption; it simply wants people and organization to work with more care for the environment. At the least level, an organization may practice “pollution-preventing” processes which means eliminating or minimizing waste even before its creation.

References

Victor Lebow (1955). “Price competition in 1955”. Available online from: hundredgoals.files.wordpress.com/2009/05/journal of retailing.pdf

Kasser, T., & Kanner, A. D. (Eds.). (2004). Psychology and consumer culture: The struggle for a good life in a

materialistic world. Washington, DC: American Psychological Association.

Mukerji, C. (1983). From Graven Images: Patterns of Modern Materialism. New York: Columbia University Press

Embody3d (2010). The Sustainable Design Lie – Consumerism vs Environmentalism. Available online from: http://embody3d.com/2010/05/27/the-sustainable-design-lie-consumerism-vs-environmentalism/