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In the following, the five concepts will be alternatively discussed with theories and practice. 2. The brief meanings of marketing management philosophies The production concept Is one of the oldest concepts In business. It holds that consumers will favor products that are available and highly affordable. Therefore, management should focus on improving production and distribution efficiency. (Armstrong & Kettle. 2003, Pl 9). For example, Henry Ford’s whole philosophy was to perfect the production of the Model T so that its cost could be reduced and more people could afford it.
The product concept holds that consumers will favor products that offer the most quality, performance and innovative feature. Thus, an organization should devote energy to making continuous product Improvements. (Kettle, Armstrong. Brown & Adam, 1998, Pl 6). Nowadays, there are some oriental manufacturers adopt this concept. The selling concept holds that customers will not buy enough of the organization’s products unless it undertakes a large-scale selling and promotion effort. (Kettle, Armstrong, Brown & Adam, 1998, pop). The concept Is typically practiced with unsought goods such as encyclopedias or insurance. The company being more effective than competitors in creating, delivering, and communicating customer value to its chosen target markets. (Kettle, 2000, pop). Many successful and well-known companies have adopted the marketing concept. Disney, Marriott, and McDonald follow it faithfully. The societal marketing concept holds that the organization’s task is to determine the needs, wants, and interests of target markets and to deliver the desired satisfactions more effectively and efficiently than competitors in a way that preserves or enhances the consumer’s and the society’s well-being.
Kettle, 2000, pop). 3. Deli electronic company implemented the marketing concept Deli is one of the largest electronic companies in China. It was founded in January, 1989, located in Wenches City of Jagging province. The major products that Deli provides are lights. Recently in China, this industry is a perfect competitive field, over 1,175 firms fight for the market shares and profits in this field. In order to achieve a great success, Deli began to pursue the well-known companies’ way to carry out the marketing concept in 1998.
Concretely, it followed the four pillars of marketing incept effectually: target market, customer needs, integrated marketing, and profitability. 3. 1 . Target Market A target market consists of a set of buyers sharing common needs or characteristics that the company decides to serve. (Kettle, Brown, Adam & Armstrong, 2001 , IPPP). Apparently, the company would do best when they choose their target markets carefully. The management of Deli recognized that the lights are considerable common merchandise at present. However, any type of light cannot satisfy all the customers although they are similar to need the light.
In order to choose the proper markets ND provide the goods well, Deli pursued the marketing concept tightly to targets its markets in three activities: market segmentation, market targeting, and market positioning (see figure 1). Figure 1 Steps in marketing segmentation, targeting, and positioning Market Market Market Segmentation Targeting Positioning (Source: Armstrong & Kettle, 2003, IPPP) First, according to their market research, they divided the lights market into two consist of factory buyers and public buyers; consumers involve family buyers and individuals.
Figure 2 (next page) shows the segmentation of lights market. Second, in light to Michael J. Baker, a critical decision is the selection of target market segments. (Baker, 2000, IPPP). The management of Deli noticed that organization buyers tend to purchase the lights of special function and high quality. In contrast, consumers usually enjoy the beautiful and quality lights. Especially the family buyers, they often focus on the appearance, quality, and coordination with the environment. To combine their producing implements and expected profitability, they determine family buyers as their target market.
Figure 2 The segmentation of the lights market Third, when Deli obtained achievement in family buyers market, it began to add segment into individuals segment in the early of 2000. Eventually it established a powerful position among the lights industry and accounted for 12. 7% of market shares. 3. 2. Custom’s Need Satisfied customers can become loyal customers. (Peter & Donnelly, 2001, IPPP). Therefore, today’s most successful companies including Deli embrace customer satisfaction carefully. 3. 2. 1.
The family buyers’ need in lights industry In order to master the customer’s need, Deli founded a Customer’s Need Study Center (CANS) in 1998. CANS was responsible to study the customer’s stated needs, real needs, unstated needs, delight needs, and secret needs etc. As result, four kinds of customer’ needs are highlighted in their study. (1) Reasonable price. (2) High quality. (3) Nice appearance. (4) Various types. 3. 2. 2. The methods that Deli satisfied customer’s need Deli held a steady principle that is customer-centered.
To satisfy the customer’s need, firstly, Deli began to implement the cost-leadership strategy and attempt to reduce the price of products from three aspects: choosing the best suppliers; enforcing the internal control; reducing the middle-distributive sectors. Nowadays, the average price of their lights reduces about 7. 5% of initial price. Secondly, Deli established the Invention Sector to explore and apply new technology in the producing process. The biggest benefit for customers was that Deli’s lights cold save 9%-15% electricity if other things remained steady.
In addition, at present, Deli could provide 328 types of lights, which basically satisfy the different Thirdly, in order to offer continuous services to their consumers, Deli established the warranty service system. It mainly solved some problems that consumers maybe suffer after purchase. Noticeably, Deli regarded the system as the leader step to meet the customer’s need. 3. 3. Integrated Marketing When all the company’s departments work together to serve the customer’s interests, the result is integrated marketing. (Kettle, 1997, pop).
Deli noticed the importance of integrated marketing and followed it. First, Deli modified the Sales Department to Sales Center in order to coordinate various marketing functions such as sales force, advertising, customer service, and product managers etc. As result, all these marketing functions must be harmonize from the customer’s point of view. The most advantage of the Sale Center was to reduce the conflict among the marketing functions. Second, to achieve coordination in the operation process, Deli centered the Sales Center throughout all departments.
In Deli, “think customer” was each department’s duty, and other departments must support the Sales Center. For example, Financial Department and HRS Department must depend on the requirement of Sales Center to operate. In addition, there is a concept of the customer is the god in Deli. They treat the customers as the top of the organization instead of top manager. Next in importance are the front-line people. Under them are the middle-managers, finally, at the base is top management. (See figure 3).