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Marketing and its potentials

  1. Capital market reforms
  2. NetSol launches the fastest internet service
  3. Micro-credit banking in Pakistan 
  4. An interview with Zaheer A. Kidvai of BITS
  5. Price hike
  6. The increase in gas tariffs
  7. Bank privatization in Pakistan
  8. PTCL new tariff policy
  9. Marketing and its potential

By Seema Tunio,
Isra University Hyderabad
Aug 14 - 20, 2000

Nowadays marketing is all around us. Companies use marketing to sell their products, People use marketing when they apply for jobs, Non-profit organizations like hospitals and educational institutes use marketing to market their services, even politicians use marketing to contest for votes.

If we look back a decade from now there was comparatively less competition in the business. The problem at that time was production not selling and this was the first stage towards the evolution of marketing. Here manufacturer tried to find the ways to reduce their costs by producing in bulk, but the customer was given the secondary priority. Producers emphasized on mass production and mass selling. They considered that all the people have the same type of needs i.e. they made no distinction between needs of working women or homemakers, gregarious person or a solitary person. So manufacturers tried to sell whatever they produced. The second stage was selling the product through persuasive selling techniques. Behind this they had a thought people would buy anything, which the producers are trying to sell if they will use proper techniques to sell the product. There was no concept of marketing. So manufacturer only believed in mass production and mass distribution and mass selling the products already manufactured by them. With the passage of time when the competition became stiff only relying on existing products and trying to sell these products have become absolutely unreliable. In this new era the businessman in order to survive and make some profit has to study the trends in the business, or try to understand the needs of the customer and finally satisfying the needs of the customer by producing the products demanded by them. At the third stage marketing was evolved.

The starting point of the marketing is the market or actual and potential buyers and their needs. The marketer tries to understand the differences in the needs based on their several factors like age, gender, social-class and behaviour. After much thought the products are manufactured keeping the customers in mind. Naturally the consumer will buy the product because it is according to their needs. This concept is contrasted by the selling of manufacturing concepts where the factory is the starting point and the emphasis is on the existing products with no empathy to customers needs.

Is marketing a gimmick?

A) Misinterpretation of marketing: Laymen misinterpret marketing and just consider it as advertising and some consider it as selling some as just a business activity. Even only a countable number of local businessmen have truly tried to explore its potential. We have seen businesses doing wonders because they have recognized the worth of strategic marketing planning. Numerous examples of multinational corporations are in front of us have used marketing in its true sense in Pakistan. Like Shell, Proctor & Gamble, Disney, Toyota, and Coke to name a few. Many local businessmen invest millions of rupees every year in securing assets and training people in finance and management but very few of them focus their attention in harnessing the marketing relevant tasks.

B) What is marketing? Pakistani businessmen with landlord or political background are very good in maintaining accounts and other related fields but they overlook the use of marketing. So what is the core benefit of marketing? Which is this animal called "Marketing"? Is it trick or a prank or gadget to loot the customers or a quick way to make money? The answer is a big "NO". Marketing is producing goods according to the needs of the customer, pricing the products in a way that it becomes affordable by the customer, delivering the products in most efficient manner and promoting the products in the best possible way in this dynamic environment. In simple words "Marketing is identification and profitable satisfaction of customers needs". Punch line of Marketers is "Customer is the boss". The chief thing they try to do is to create products according to the tastes of people.

From this definition we can clearly see that marketing has three basic components: i. Marketer identifies the needs of the customers through analyzing the environment called environmental scanning / environmental monitoring then finding the strengths, weaknesses, opportunities and threats that affect the organization's ability to serve its customers; ii. It produces the goods and services that satisfy the needs of the customers. Which is technically called developing; marketing mix and; iii. An organization earns reasonable amount of profit to survive.

In the first component marketer tries to study the general demographic, technological, cultural, political, social trend that might affect the organizations. Marketer also gets the information about the competitors, suppliers, and customers. Marketer divides the market into different segments based on their differences in the tastes and preferences and their demand for variety of products. This variation in consumer demand is due to factors like gender, age, income, locality, activities, interests and behaviours. Marketer then on the bases of these variations develops profiles of the customers and chooses one or two segments to enter into which is called target marketing in marketing terminology.

The second part is about developing a marketing mix. Marketing Mix is combination of 'Product', 'Pricing', 'Placing' and'Promotion'. a) Product is a good, service, or any benefit offered to the public for sale. Marketers make decisions regarding quality, features and design of the product. They also make some branding decisions and take into consideration product life cycle stages. b) Price is set by different strategies, in a way that suits the customers needs. Determination of prices is again the lengthy task in which lots of decisions are involved. Here marketer considers the internal and external factors affecting prices like marketing objectives of the company. The different types markets and demand for the product. And then considers different pricing strategies based on differences in the customers. c) Placing includes activities involving physical distribution of goods and services. The major concern here is how to transport, store, and order-processing so that the goods can safely reach customers on time. Major wholesaling and retailing decisions are again made to ease the customer. d) Promotion is communicating the customer about the product. Promotion Mix is again divided in Advertising, Sales Promotion, Personal selling and Public Relations.

Here one thing that we have to notice is that advertising is not playing the basic role as is suggested by many local people but is playing a supplementary role. Thus advertising is a tool of marketing but not the marketing itself.

The third component involves making profit that is very essential for every organization to survive as well as to grow. The company is making profit because the customer is happy with the product and buying the product to satisfy his need.

Marketing potentialities:

A) Utility of marketing

i. Helpful for 'consumer products' manufacturers: Marketing field, which is underutilized, can be used as an effective and efficient tool to help businesses. The foreign companies manufacturing daily use products like shampoos, soaps, toothpaste e.t.c, have been using marketing since long time and have been gaining a lot from it. Proctor and Gamble, Lever Brothers, and other multinational companies have their own marketing department to take care of marketing related activities. Pakistan saw a major change when for the first time big Multinational Corporation Shell International started to operate independently of Pakistan Burmah Shell in Pakistan in 1993. Shell Pakistan utilized marketing by setting new standards for the petroleum products. It started to build very clean retail outlets and Shell select shops, which was very new for the local consumers. This impressed the consumers and they very much facilitated by the use of it. Seeing this lots of competitors jumped into the bandwagon of providing good services by using marketing strategies. Pakistan State Oil and Caltex improved their services and thus increasing customer satisfaction.

ii. Helpful for 'industrial products' manufacturers: In the developed countries industrial products are marketed as well. Non profit organizations like hospitals and educational institutions use marketing to remain competitive. Lots of 'Consumer-products' manufacturing companies use advertising as a major tool. But 'Industrial Products' use personal selling as a major tool for the promoting their products.

iii. Helpful to revitalize the economy: Some Asian countries started with the same resources like Pakistan, have become Asian tigers with their continuous perseverance and by use of marketing strategies. We can follow the examples of these countries and lead our country the road of success and in this marketing can play a vital role. A glance over the world markets will show that our country is bombarded with slogans to purchase dried milk, ready-made garments, canned food, and cosmetics. We import products like fridge, televisions, books, cars and even defence needs are met by foreign made products.

A quick look at the facts reveals that GDP of Pakistan is approximately Rs. 3500 billion. Exports of Pakistan in the year 2000 amount to approximately 37 billion rupees and imports are 42 billion rupees (Source: Federal Bureau of Statistics). Here again we can clearly see a huge gap. Since mid 1980 we have been hearing that the Pakistan's major exports are cotton, cotton textile, and surgical, leather goods, sports items but their isn't any branded item in this category. Our major imports are infant milk, tea, petroleum products, agricultural, rubber and other chemical items etc because people prefer these foreign made goods, which are highly advertised and recognized by their brand name. These branded goods are pleasing in appearance, physically and chemically reliable, and contents are true to individual ingredients as labelled on the package.

We can save lots of foreign exchange by little bit improving our balance of trade. Exporting lots of our local products by improving our image through careful strategic marketing planning. We can do so for our raw materials, if the vigorous marketing skills are passed on to petty farmers, livestock-herders, and agriculturists as we rely heavily on raw materials being an agricultural country.

iv. Helpful to build trust of foreign businessmen: Marketing techniques can help win over the trust of foreign businessmen. State ministers have been claiming that we want to convert our economy from state owned to customer oriented services, from protection oriented to competition based but it is not being implemented. The prevailing situation is that businesses of foreign countries don't trust having trade with Pakistan firstly because Pakistani businesses do not provide them quality products, secondly they deliver the products very late, thirdly foreign importers return the goods because they are not according to sample already shown to them. Finally corruption, poor law and order conditions, financial crises and mismanagement is the order of the day, which have made our country reach at this stage of abysmal.

Here Branding can come to rescue of local business name. Companies should try to build brand equity and cash upon it. Pakistani companies have not been able to develop a nationally recognized brand what to talk of internationally recognized brand. Pakistan has very few national brand names to its credit like Ahmed Food Industries and Gul Ahmed Textiles but even these names are not internationally recognized. India got independence with Pakistan but is far ahead in software developing, film and fashion industry. They have major brands like Godrej, Tata and Vimal to name a few.

v. Marketing is very flexible: Even if the companies cannot afford to have their own full-fledged department they can take Japanese as their role model of marketing. Japanese companies don't have a marketing department. They create a sense of awareness among its entire staff how to satisfy the customers. Even the employees at lower end of hierarchy should have the sense to treat a customer in a courteous way. This is very easy thing but it requires lots of coordination among all of staff.

Conclusion

Marketing if used in proper manner do wonders to help our businessmen but also country people as well. Marketing is useful in all respects but our businessmen do not explore its potential benefits. It can increase their sales and thus increasing the profit of our businessmen. It increases the consumption, satisfaction, and choice of the customers. Its objective is to maximize the quality life which means providing the not only the best quality product but also pollution free environment. Marketer is trained to avoid any type of exaggeration in the communication the advertising the message to the public which enhances the customers trust on the product. They make sure that the advertisements should be morally fit for the country and ethical standards should be maintained.