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Unit 2 Marketing Essential Report
L.O 1: Explaining the role of marketing and how it interrelates with other functional units of the organisation
Marketing can be defined from a two-fold perspective. First, it could be defined in terms of that attempt to place one’s ideas, products or even services in the market for consideration by potential audience or customers. Hence, it is a rational attempt to the series of activities that one undertakes to promote or inform the potential customers on the existence of a product hence promoting their sales or purchase. Traditionally, marketing is about advertising, selling and delivering the products to the target businesses and consumers (Brassington and Pettit 2012). However nowadays the functions of marketing are far beyond that initial concept.
1.2 The Marketing Concepts
The organisation aim is to design strategies that would establish a profitable link with the potential consumer. In order to do achieve this, the marketing is concerned with promotion and selling, but also with research and development, public relation and after sales service.
Nowadays through the power of the social media the marketing effort are focused on the creating an image of the brand by different channels and media tools. For example now the brands globally are using Facebook and Instagram “story” section in order to be more engaged with its audience. Below is an outline of five common marketing functions, under which the roles and responsibilities of marketing are well defined.
The perception of production concept provides that the consumers will tend to prefer the products which are in availability and are also affordable. This concept has been in existence and is often used by companies depending on the situations that warrant that kind of behaviour (Brassington and Pettitt, 2012). The main aim here is to be maximised the revenue by increasing the sales. An effective way of this is by using economy of scale. For example the clothing manufacturing group “Inditex” include brands such as Zara, Massimo Duti and Bershka is able to offer very affordable prices to the market due to its mass production. Thus the sales are high due to the affordable prices, but also the cost of production per single piece stay lower.
Here the main focus is on the product. How that product reflect on the organisational image? It is vital that the product concept deliver a competitive advantage. That can be through a unique feature, design or better functionality. It could also include its availability or quick delivery to the customer. However the organisation must be sure that there is a current demand as well as in future there will be such a demand or higher. Also that the customer requirements are met.
For example when Tesla motors offer their first Electric car, they have achieved a competitive advantage due to the uniqueness of their product and inability of the competition to offer similar product.
From the other side Nokia fall behind, because its inability to understand the future demand and the customer requirements.
The marketing concept
This concept provides that for the organisation to achieve its goals, it needs to understand, in absolute terms the needs and wants of the target markets. That way, it will easily deliver the expected satisfactions and even stage some competitive advantage over other companies. In this case, the department and management team will be expected to embrace the “customer first” approach. Hence, the core elements that are looked into in this case include customer focus, as well as value given to them. Most probably, through this, companies can eventually achieve the targeted sales and profits. In order to understand more, the organisation must engage more with its audience. Communication through the channels is essential nowadays as it allow the company to see more from the customers prospective.
The selling concept
This concept provides that the consumers are not expected to purchase sufficient products from a firm until it takes the initiative to engage in large-scale sales, as well as, promotion. Promotion has playing a huge role in the increasing of the sales. That is why for example in fashion promotions and sales period are generating most of the profit. The brands are using a technique where the prices are set higher in the beginning, so when they are on sale the company does not loosing of that. However well-established luxury brands tend to avoid such a strategy in order to keep their premium status. The company also should strive to produce high level of after sales service to ensure that the existing customers will remain interested in the future products or services of the company.
Societal Marketing Concept
In this relatively new concept the main emphasis are on the positive impact and the ethical principles of the product or the company as a organization. For example a company using only paper packaging for its products, instead of plastics
1.3 Key Roles and Responsibilities of Marketing and their relationship with the wider organisational context
Marketing as an organisational function, reflect the attempt by the organisation to first determine, identify and ultimately source the products for the market and promote the sales in terms of increasing awareness among other enroot functions. The core functions of marketing functions involve strategy management, sales support system, product development, market research among others (Marketing and its relationship with other business activities 2019). From a global perspective, the key roles and responsibilities of marketing include buying, selling, storing, standardization, financing, risk taking, and market information.
The link that exists between the marketing functions, the key roles and responsibilities, and the wider organisational setting can be described to take the complementary form. To be precise, the explicit marketing roles and responsibilities that are manifested in the different functions of marketing. Every organisation is comprised of a variety of departments. The marketing functions are essential in backing up the operationalization and success of the mainstream departments. For instance, when the business organisation requires to have a well-orchestrated marketing plan, it needs to incorporate the finance department resources, the human resource department, the production department, the risk mitigation department, and the sales departments (Marketing and its relationship with other business activities 2019). The marketing functions are established in such a manner that they reflect the departments in the organisation. The finance department needs to be served with a realistic marketing plan from which it can advise on the appropriate and possible financial allocations. The human resource department needs to be served with marketing plan from which it can advise on the availability of the human resource component. To this effect, they are merged or work together to foster increased profitability and increase sales and value in the face of the internal and external stakeholders. The end product often includes increasing the level of sales at Walmart Inc.
1.4 Analysis of The Roles and Responsibilities of Marketing in The Context of the Marketing Environment
Before establishing the relationship that exists between the roles and responsibilities of marketing and marketing environment, it is important to note that marketing roles and responsibilities compliment the wholesome marketing environment. At Walmart, it is essential to have an understanding that the marketing environment constitutes four elementary groupings which include the technological, economic, sociocultural, competitive and ultimately the political-regulatory environments (Brassington and Pettit 2012). For these environmental groupings to be addressed, a marketing manager will have to employ a number of approaches as stipulated in this section of the research.
First, marketing management has a responsibilities affiliated with marketing information systems. As a marketing manager, it will only be essential to ensure that there is a marketing information system. This system will assist in the provision of information regarding the products, the planning procedures, the implementation and finally the controlling of marketing strategies. Another role of marketing is that of monitoring the marketing environment. The marketing environment is often dynamic (Blythe and Martin 2019). Within the marketing process, it is deemed crucial to identify a set of new developments within the marketing environment. The developments therein offer a platform to understand the series of developments affiliated with the products and services that are offered by Walmart Inc. pursuant to the marketing environment components, the ever emerging trends or developments oscillate around the internal and external market changes, the socio-economic aspects and finally the political-legal alterations.
Another very important role of marketing and which is believed to have a highly affirmative impact on the marketing environment is that of marketing research. Research and development is often elementary in ensuring that processes and products are up to date and can concurrently respond to the demands in the market. Walmart is already known for its uniqueness in branding and pricing strategies. The marketing department will however have to ensure that it reviews the wide variety of alternative approaches that could be used to ensure that Walmart retains a favourable marketing environment both in terms of brand reputation and long-term profit relationship with the potential target market.
The marketing department is equally responsible for ensuring that the issue of brand equity is addressed amicably. Most consumers associate their preference for products with the value that is added to them. Thus, marketing provokes the need for to build a reputation and even build a very strong and competitive brand amidst the very competitive retailing industry. Thus, a reputable and competitive brand implies a strong convincing power in the market.
1.5 The Key Elements of the Marketing Function and their Interrelation with other functional units of the Organisation
The marketing function has a series of elements which when interrelated with the functional units of the Walmart organisation do generate outstanding performance in the market. Below is a segregated analysis of these functional units and their interrelations with the marketing functions elements.
Research and Development
The research and development function at Walmart is an elementary thing since it has to keep developing new products and services on a yearly basis (Ruekert, and Walker 1987). Hence, it is the engine of the organisation that generates creative new ideas, innovative processes, as well as, products and services. The research and development at the company should indeed be influenced or driven by the marketing concept (Brassington and Pettitt 2012). In the event that there are no goods or services in store or on the catalogue, sufficient research and development efforts should be incorporated to develop or improve them with the aim of satisfying the customers. To this effect, marketers in the organisation are expected to liaise with the respective engineers and researchers with the intention of ensuring that customers’ expectations are gathered and represented.
The human resource function is another very paramount functional unit of the organisation that focuses on crucial proceeds such as training, recruitment and selection, and ultimately handling the development of the employees. It is also a department that manages that employee motivation, the well-being of the employees, their management, and also ensures that legal aspects of the company are addressed. As a marketing manager, it is vital to engage the human resource department in hiring, training, building capacity and advising on HR legal matters to marketing employees. Hence, the ultimate credibility of the company will depend the human resource department.
The IT function – Strategy Element
The IT function is a contemporary component in the organisation’s structure. At Walmart, the IT function has been the backbone of its e-commerce operations especially after it moved from absolute store-operations to being a multinational company. The marketing department heavily depends on the IT department to undertake its respective activities such as keeping marketing records, performing analysis on company performance to share with the potential customers through financial reports and efficiently sharing advertisement ads and videos. Through the intranet platforms, it becomes feasible for the marketing department to communicate with other functional departments on matters regarding marketing.
Customer Service Function – Tactics role
Among all the functional units at the company, the single unit that is most interrelated with marketing is customer service provision. Remember, when defining or understanding the context within which marketing operates, the most obvious items include customer satisfaction and the exchange process. Hence, it is auto-explanatory that there is a very important and indisputable link between marketing and the customer service functional unit at the company. For instance, Walmart would intend to communicate or address customer issues, the customer service department would play the central role in sharing the details with the customers or responding professionally to issues as they arise. To this effect, it becomes necessary and sufficient to maintain consistent communication between the two units. Today, at Walmart, the customer service provisions on matters regarding products or services are at the head offices. That means that the marketing department staff does not have to get attention divided towards responding directly to the customers.
Finance and Production Departments – Planning and Tactic Elements
The finance and production departments at Walmart are quite elementary towards ensuring that there is continuity and sobriety in the company’s operations. From a planning perspective, the marketing department needs to share the information purposed to inform the products that ought to be offered, the warehousing preferences, the packaging preferences and the most suitable distribution channels. The marketers equally need to share their ideas to the finance team seeking to inform and get informed on the most realistic and possible budgetary allocations. On both accounts, there is a very essential relationship that exists between the functional units and the elements on planning and tactical approach to the market.
L.O: Comparison of ways in which organisations use elements of the marketing mix (7P’s) to achieve overall business objectives
A Comparison On the Ways in Which Different Organisations Apply the Marketing Mix to The Marketing Planning Process to Achieve Business Objectives
The main objective is to ensure that the company’s organisational goals are met (Walmart Marketing Mix 2018). Walmart’s business organisation in most cases focuses on the aspect of products and services, the market scope and size and even the ability to reach every potential market. Most essentially, during the planning process, the company incorporates every single component of the 4 or 7 P’s.
Walmart is a multinational corporation. It operations in the United Kingdom have resulted in the company creating employment for quite a large number of people. It is a company whose central focus is to address the expectations in the market (Blythe and Martin 2019). Hence, in its planning endeavours, the company has always focused on some very common yet articulate strategies such as employing competitive prices, ensuring that the information on the products (product promotion), embraces diversity in its product portfolio and ultimately selects the best places to operate from. Hence, that becomes the baseline of the company’s marketing plans.
Evaluation of the different tactics applied by organisations to demonstrate how business objectives can be achieved
Organisations such as Walmart often employ tactics to enable them achieve their objectives and to do so in time. There are different tactics that are at the disposal of these organisations. However, it is necessary and sufficient to ensure that these strategies are concurrent with the demands in the market (Brassington and Pettitt 2012). The market forces are different from one industry to the other. For instance, Walmart operates in a dynamic and very competitive environment. To that extent, it will be essential to focus on at least two tactics that are employed towards influencing the achievement of the business objectives. These include the 7 P’s and the Marketing Segmentation Process tactic.
In order to compare different ways of achieving the marketing objectives will be used Costco as a benchmark to Walmart.
The 7 P’s Tactic
The price of a product often influences the extent in which customers will be willing to pay for the product. That implies that the continuity of the product’s success in winning the market will depend on the price set (Blythe and Martin 2019). However, the price must depend on a number of things including the cost of production and the expected revenue. Walmart employs a low-pricing strategy with the intention of benefitting from the economies of scale concept. On the other side, the competitor company Costco uses a similar pricing strategy of a market-oriented pricing strategy. However, this pricing strategy only works in the case of bulk purchases or wholesale purchases. That is unlike in the case of Walmart where there is a common low-price strategy for retailed and wholesale transactions.
On the issue of production, solemn issues such as innovation and prowess to avail a variety of products in the market is put into consideration by organisations. The differentiation in products also assists companies to achieve their sales targets. For instance, at Walmart, the company focuses on product differentiation and maintains strong and attractive brands that the customers can always want to purchase. Other companies such as Amazon and Costco do not invest as much as Walmart does into product differentiation and innovation as Walmart. However, the minute effort that these competitor firms have had demonstrate that indeed, the strategy is of magnificent value.
Similarly, Costco offers a wide variety of products. However, compared to Walmart, Costco does have a limited product mix. It is gradually expanding the product offering but still has to do a lot in ensuring that it competes with Walmart significantly from this front. Today, Costco is now offering services including life insurance, photo printing and even payroll services. That is an indication that Costco is expanding its product mix with a desirable level of diversification.
Most organisations seek to inform the potential consumers or customers on the availability of specific products or services. These messages are purposed to inform the customers and attract them towards buying or recommending products. Walmart, for instance, undertakes a series of promotions with the intention of informing the customers on potential developments that are warranted to satisfy their demands. Amazon, on the other side, promote its services in different forums including the social media platforms, email, pop-up ads among other approaches. Part of its success is affiliated with the intensive promotion strategies.
On the other side, Costco conducts its promotion or marketing practices through, sales promotion, personal selling, public relations and direct marketing. In addition, the company also makes use of the wholesale discounts tactic to woe its potential customers. In this case scenario, the consumers are guaranteed to purchase products at low prices when they purchase in bulk or wholesale.
Ultimately, the use of place or location as a means of determining where best to place a business is often considered by companies investing locally or internationally. Factors such as accessibility are put into consideration where the more the premise is accessible, the better the chances of achieving the goal of making huge sales. Unlike Walmart, Amazon has not managed to capitalize its efforts in the location aspect of marketing. The main challenge is that there are very few physical stores in a great part of the global market. Hence, accessibility becomes an issue.
Costco, on the other side, has not yet managed to engage too much into e-commerce way of reaching the customers. Instead, the company has the warehouses, online stores and mobile apps. Consumers are expected to identify their desired products on the online stores shelves and request that products be delivered to them. However, it still remains a very competitive player in the retailing industry.
The Market Segmentation Process
This approach is quite demanding especially since it involves a set of stages before a conclusive solution can be employed (Blythe and Martin 2019). First, the companies engage in serious definition of the market segments. They could be defined on the basis of demography or even economic prowess or industry of operation. The attractive aspects of each market segment are them established. Upon undertaking this research, the outcomes are then used to develop the positional strategy of the products or services that best suit these customer portfolios. Walmart company, for instance, has consistently employed this strategy to inform its branding activities. Amazon, on the other side, has not focused so much effort on serious market segmentation. A feasible reason is because it has a variety of diverse services that it gives including the introduction of e-commerce expecting that any customer may purpose to use the platform to access products and services offered.
Company Description and Structure
Walmart Inc., was formerly known as Walmart Stores, and was incorporated in the year 1969. It engages in massive retailing and wholesaling. To be precise, the company is an American-based multinational retail corporation which deals with discount department stores, grocery stores, hypermarkets. The company does operate via three specific segments including Walmart – United States, Walmart International and Sam’s Club. The version that operates in the United Kingdom is the Walmart International. Below is a clear and simplified organizational structure of the company.
Walmart Inc.’s core competencies constitute the strong supply chain management, the dominant buying power and the superiority in terms of logistics (Walmart Core Competencies 2019). It is because of the possession of these core competencies that the company manages to give way for Walmart to make sales of their products at reasonably low prices as compared to most of the major competitors in the retailing industry (Jobber and Ellis-Chadwick 2012). From a historical perspective, the company managed to acquire a stop in the fortune 500 list in the year 2014. Walmart is a key player in the establishment of the universal bar code that was used to facilitate the introduction of a more effective and relevant inventory management system and concurrently assist in promoting heightened value of the supply chain in the company’s business structure. There has been a series of disagreements staged by economists regarding the feasibility of the company hurting the economy or improving the state of the economy with its pricing strategy.
Today, Walmart Inc. is renowned for its ability and practice in offering extensive amounts of products at reasonably low prices, a strategy that has granted it a chance to be listed on the fortune 500 list. The strategy concurs with the company’s mission and vision, which are focused on ensuring that people get value for the money they spend and still save on their consumption as a result of the comparatively low prices offered. The company operates either from the retail stores, on-line platforms and even through mobile devices. Statistically, approximately 245 million customers, as well as, members tend to visit their more than 10, 800 stores in the different countries across the globe. The company also has e-commerce website reaching the global market too. To this extent, despite the challenges of competition by companies in the industry, Walmart still remains a relevant and a leader in terms of market sustainability, employment opportunity and acts of philanthropy.
To ensure that there is improved advertisement, as well as, merchandizing support channelled towards apparel.
To assist in the development of Wal-Mart-linked and possessed brands mainly of the chic apparel line
To promote increased adoption of advanced store concept where e-commerce will be expected to supersede all other marketing strategies.
Unlike most companies in the manufacturing, processing and service industries, Walmart’s target market is most feasibly more than 95 % of the entire demographic composition (Walmart Marketing Mix 2018). However, in the target market context, the company manages to attract a population of the middle and low income earners. That is because the price levels are favourable to them. That means that there are very rare occasions that the company will tend to sell high-end products. Concurrently, the pretty wealthy persons do not consider shopping much items from the stores. The only likelihood of high income earners getting to buy from these stores is in the groceries. Hence, the company’s target market is vast being characterized by the economic prowess.
The Marketing Mix
The company has a well-defined marketing mix with the four key areas of coverage being put into consideration. These areas include product, place, price and ultimately promotion (Walmart Marketing Mix 2018). The bottom line of the entire marketing mix is that the company possesses a strategic and quite elaborate pricing, distribution and advertising approach.
One very important fact to consider is that Walmart operates as a multi-brand retailing store. It combines a variety of product lines, hence embracing product diversity. Walmart trades in home improvement items, shoes and jewelry, music and books, electronics, food stuff, health and beauty products, auto and tires and Halloween among other products. These products ensure that the company has reached a variety of departments or areas of consumption, hence being able to attract a wide variety of customers who seek to satisfy their different needs or wants.
From a historical point of view, and as per the facts and assertions provided in the plan, the low-price strategy is the dominant marketing strategy that the company focuses on to woe the target consumers. Currently, Walmart is the market leader in terms of pricing. The company operates on the benefits of economies of scale and value and concurrently offering products at a reasonably low price. Certainly, the use of the “every day low price” (EDLP) strategy is consistent across the trading periods.
Today, Walmart has more than 11, 500 retailing units globally that are assigned around 63 banners in more than 28 countries. In reference to the three specific segments of operation at Walmart, out of the 11500 units, more than 4600 are Walmart- US, more than 650 are Sam’s club and ultimately, more than 6200 are Walmart International Outlets. Out of all these categories, in the UK, the total number of retail units is 633. These include 341 ASDA superstores, 209 ASDA supermarkets, 33 ASDA living, 32 ASDA super-centres, and 18 ASDA petrol fuelling stations. That demonstrates that the company is well placed in terms of the location and access of products by consumers.
Walmart has a plethora sales promotion strategies. Most importantly, the company embraces its competitiveness in its pricing strategy as a means of promotion. However, the company’s other approaches include the use of the e-commerce websites, where excellent slogans are used (Page 2016). In addition, the company uses internet ads and social media ads to market its products and services.
The company’s future endeavour is perceived or intended to incorporate the formation of specific market segments unlike in the past where the company has been considered to have a common market segment. These foreseen market segments are categorised into profiles.
Profile 6: The High Income and Thrifty Persons (10%)
Profile5: average level of income and trendy-thrifty people (25%)
Profile 4: Low Income earners who are trendy and thrifty (15%)
Profile 3: High Level of Income and spendthrift persons (20%)
Profile 2: the average income earners who are spendthrift (15%)
Profile 1: the low income earners who follow trends and are spendthrift (15%)
Beside the profiling of customers in terms of the economic prowess, there are intentions to consider the US geographical location, and an age between 20 years and 35 years.
|Investigations||Customer Care Department/ Sales and Marketing Department||Identification of potential market segments by order of dominance||1.5 months||0.5M dollars|
|Customization of Brands/ Brand specification||Production and marketing Departments||Development of pilot brands intended to address the profiled groups||2.5 months||1.2M dollars|
|Submission and review of findings for comprehensive resolution||Production and Marketing Departments||Intended to pave ways for actual implementation of this innovative idea||1.25 months||0.65M dollars|
Schedule and Budget discussion
In the entire period of 5 months and 7 days, the process is expected to use 2.3 million dollars with the expectation that the company will acquire profits and recover the costs. It is important to note that this is a short-period section of the entire plan of ensuring that Walmart remains a globally competitive company in the market. Thus, information is considered to be very essential in the process.
Blythe, J. and Martin, J., 2019. Essentials of marketing. Pearson UK.
Brassington, F. and Pettitt, S., 2012. Essentials of marketing. Pearson education.
Howell, R., 2012. Market segmentation: the importance of age cohorts. Neumann Business Review, pp.21-34.
Jobber, D. and Ellis-Chadwick, F., 2012. Principles and practice of marketing (No. 7th). McGraw-Hill Higher Education.
Marketing and its relationship with other business activities. 2019. Retrieved from http://www.sanandres.esc.edu.ar/secondary/Marketing/page_14.htm
Page, V. 2016, January 4. Walmart’s New Advertising Plans. Retrieved from https://www.investopedia.com/articles/investing/010416/walmarts-new-advertising-plan.asp
Ruekert, R.W. and Walker Jr, O.C., 1987. Marketing’s interaction with other functional units: A conceptual framework and empirical evidence. Journal of marketing, 51(1), pp.1-19.
Walmart Marketing Mix – Understand Walmart’s Marketing Strategy. 2018, May 2. Retrieved from https://corporatefinanceinstitute.com/resources/knowledge/other/walmart-marketing-mix/
What Are the Walmart Core Competencies? 2019. Retrieved from https://www.reference.com/business-finance/walmart-core-competencies-7c34dcf3cb80aca3