Introduction

Marketing is a managerial function that attempts to create, expand and maintain a collection of customers. It attempts to deliver demand satisfying output through profitable exchanges.

Two major factors are:

• The recruitment of new customers (acquisition)
• The retention and expansion of relationships with existing customers (base management).

The 3 Levels of Marketing Strategy

Corporate Level

Marketing at the corporate levels asks this question as 'What business should we be in and what opportunities should we pursue?' This is before we even have a business, idea or product. This is what is known as entrepreneurship.

Business Level

Marketing at the business level asks this question as 'How are we going to compete against the competition?'

Functional Level

Marketing at the functional level (also known as the operating level) ask this question as 'How do we create and keep customers?' This level deals with marketing tactics and the '4ps' of the marketing mix. This level defines and develops products, prices them, promotes them and then distributes them in a way that helps a company create and sustain demand for their products.

Introduction to Marketing Mix

For a marketing plan to be successful, the mix of the four “Ps” must reflect the wants and desires of the consumers in the target market. Trying to convince a market segment to buy something they don't want is extremely expensive and seldom successful. In popular usage, "marketing" is the promotion of products, especially advertising and branding. However, in professional usage the term has a wider meaning which recognizes that is customer centered. Products are often developed to meet the desires of groups of customers or even, in some cases, for specific customers.

The Four Ps

Product

The Product management and product marketing aspects of the deal with the specifications of the actual good or service, and how it relates to the end-user’s needs and wants. 

Pricing

The process of setting a price for a product, including discounts. 

Promotion

This includes advertising, sales promotion, publicity, and personal selling, and the various methods of promoting the product, brand, or company. 

Placement (distribution) or Place 

Refers to how the product gets to the customer, or the channel by which a product or service is sold (e.g. online vs. retail), which geographic region or industry, to which segment (young adults, families, business people), etc.

Purpose of the Marketing Mix

These four elements are often referred to as the marketing mix. A marketer uses these variables to craft a better plan. The 4 Ps offer a memorable and workable guide to the major categories of main activity, as well as a framework within which these can be used.

The Seven Ps

Service calls upon an extra three, totaling seven and known together as the extended marketing mix.

These are:

• People
• Process
• Physical Evidence

People

People in contact with customers can affect satisfaction. Whether as part of a supporting service to a product or involved in a total service, people are particularly important because, in the customer's eyes, they are generally inseparable from the total service.

Process

This is the process involved in providing a service and the behavior of the employee may be crucial to customer satisfaction.

Physical Evidence

Service is intangible.  It is difficult for the customer to know how the service is going to benefit them without  experiencing it. Providing the potential customers the chance to see what a service would be like through physical evidence, such as case studies or testimonials would help.

Customer Focus

Most companies today have a customer focus. The company focuses on its activities and products based on evolving consumer demands. The customer-driven approach, the sense of identifying market changes and the product innovation approach. In that case, consumer wants are the drivers of all strategic marketing decisions. No strategy is pursued until it passes the test of customer research. Every aspect of a market offering, including the nature of the product itself, is driven by the needs of potential customer. The starting point is always the consumer. The rationale for this approach is that there is no point spending R&D funds developing products that people will not buy. History attests to many products that were commercial failures in spite of being technological breakthroughs.

Product Focus

In a product innovation approach, the company pursues product innovation, and then tries to develop a market for the product. Product innovation drives the process and research is conducted primarily to ensure that a profitable market segment(s) exists for the innovation. The next big thing is a concept is that refers to a product or idea that will allow for a high amount of sales for that product and related products. Marketers believe that by finding or creating the next big thing they will spark a cultural revolution that results in this sales increase. The rationale is that customers may not know what options will be available to them in the future so we should not expect them to tell us what they will buy in the future. However, marketers can aggressively over pursue product innovation and try to overcapitalize on a niche. When pursuing a product innovation approach, they should ensure that they have a varied and multi-tiered approach to product innovation. 

Research and Analysis

The most important factor to consider as a pre-requisite to effective marketing understands how individual and organizational customers behave.  Personal and interpersonal factors influence guests' choices of hospitality services. In order to draw reliable conclusions on such factors, information will have to be gathered through research in order to realize the objectives.

The personal factors:

needs wants         motivations perception

learning personality lifestyle         self-concept

Interpersonal Influences

The interpersonal influences come from:

• Cultures and Subcultures
• Reference groups
• Social classes
• Opinion leaders
• The family.

Guests place more weight on the recommendation they receive from their friends and associates than the do on the information supplied by hospitality services. Word-of-mouth 'advertising' is therefore, a powerful force in hospitality industry.

Analysing Opportunities

The analysis of opportunities and problems is the foundation for starting and keeping a successful business. No new venture should be launched without a thorough market of feasibility analysis. Likewise, no organisation should be without at least an annual situation analysis.

Research

This is the systematic gathering, recording, and analyzing of data about the problems relating to the food and beverage, and services. The primary objective of research is to help make more effective marketing decisions.  The research supplies information which helps develop a detailed knowledge of our guests.  It also gives us information on how well we are meeting guests' needs and the position we have. New target markets are investigated, new services and facilities are assessed and tested. Primary competitors are identified, and their strengths and weaknesses are pinpointed. Research can also used effectively to back-up advertising claims.

Four Research Methods: 

• Experimental 
• Observational  
• Survey 
• Simulation 

Analyzing Market Segments

The aim is to pick out the segments that are most interested in specific services and to target marketing programs at them. Once targets have been identified, other decisions and alternatives come into better focus.  Through research, we can then further identify the needs and wants of these groups.

The question to think about is then:

• WHO? - Which market segments should we pursue?
• WHAT? - What are they looking for in our types of services? 

Benefits of Market Segmentation

The benefits are 

• More effective use of marketing dollars
• Clearer understanding  to the needs and wants of selected guest group.
• More effective POSITIONING - developing a service and marketing mix to occupy a specific place in the minds of potential guests within the targets.
• Greater precision in selecting promotional methods and techniques e.g. advertising media or sales promotion methods.

Seven Core Principles of Marketing (planning)

The Marketing Concept

When you adopt the concept, it means that you will act on the belief that satisfying guests needs and wants if first priority. 

Guest Orientation 

Having a guest orientation implies that the manager has accepted and acted according to the Marketing Concept.

Satisfying Guest Needs And Wants 

To ensure long term survival in business, the manager must always be ready to anticipate emerging guest needs.

Market Segmentation 

All guests are different. Therefore, segmentation describes the concept of identifying specific groups of people and market only to them.  Managers 'take aim' at specific targets to ensure the highest returns.

Value And The Exchange Process 

'Value' and 'value for money' are terms often used in today's business and in our daily lives. VALUE represents a mental estimate the guests perceive of a product or service's ability to satisfy their needs and wants. Although some guests do equate value closely with price, PRICE however, in not the only indicator of value.

Product Life Cycle  

The product life cycle idea suggests all hospitality services pass through four predictable stages - introduction, growth, maturity, and decline.  Marketing approaches need to be modified with each stage so as to avoid a decline - the key to long-term survival. 

Marketing Mix   

Every organization has a marketing mix.  It includes the controllable factors that are used to satisfy the needs of specific targets. Traditionally, these are identified as the 4Ps - Product, Place, Promotion, and Price.