THE FUTURE OF MARKETING

1. THE FUTURE OF MARKETING Sunarto Prayitno

2. Contents • The Future of Marketing • Marketing Strategic Transition

3. 1. The Future of Marketing

4. The Future of MarketingCor Molenaar, 2002 • Customers now want you to remember who they are, understand their needs and provide them with a specific product to meet these needs. • The internet has changed the way customers think forever. • ‘This lecture’ will help you to build your marketing strategy to attract, retain and grow profitable customers into the future.

5. Leo Burnett Company, Inc.Richard Fizdale, Chairman and CEO • ‘The New Marketing Paradigm: IMC’ could be the most important book on marketing you will ever read. The authors recognize (Don E. Schultz, et al., 1993) that the mass market is dead. • The old assumptions, strategies, and tactics for reaching abroad base of people with a single selling message delivered by mass media are no longer valid. • Television, once of the greatest mass communications vehicle, is impotent. The database will prove to be a more powerful marketing tool than television ever was.

6. Global Building BlocksCommunicating Globally, Don E. Schultz et al., 2000 The four major interrelated elements or building blocks are driving changes in the market place and thus marketing and marketing communications: • Digitalization • Information Technology • Intellectual Property • Communication Systems

7. Digitalization • The ability to convert almost all types of knowledge, information, and materials into 1s and 0s manipulate those digits through computers and electronic systems has literally changed the world.

8. Information Technology • By information technology we mean all those devices, techniques, and capabilities that allow human knowledge, data, or experience to be transferred quickly and easily between organizations or individuals around the world.

9. Intellectual Property • Historically, nations, business organizations, and individuals have been valued on the basis of their tangible assets – raw materials, land, factories and buildings, and even cash and precious metals. • Today the new wealth is knowledge, experience, understanding, and capabilities.

10. Communication Systems • Historically, communication systems have been linear, developed, organized, and delivered from a single source, whether that was a newspaper, a radio or television station, or a magazine, to masses of listeners or readers or viewers. • Communication systems, however, have changed dramatically in the last few years. In addition, many form of media have become interactive; that is audience can be both receivers and senders of messages and information.

25. Traditional Value System • Strong leadership. • Tendency to be thrifty and moderate. • Zeal for education. • Interpersonal relation emulation family relationship. • Cooperation.

26. New Value System • Rule by the law. • Social diversification. • Democracy. • Individualism. • Materialism.

27. Consumer Behaviour Transition Traditional New Value Value System System Change of Life-Style Economic Status

28. The MTV Generation

29. The MTV Generation

30. The MTV Generation

31. The Life-style Trend • Convenient Trend • Quality Trend • Personality Trend • Health/natural Trend

32. 2. Marketing Strategic Transition

33. Market Structure • The Manufacturer-driven marketplace. • The Distribution-driven marketplace. • The interactive marketplace. • The global marketplace.

34. The Manufacturer-driven Marketplace • Sellers brought their goods and services to the marketplace, where buyers come in search of the thinks they needed. • Pricing, distribution, and marketing communication occurred on the spot and instantaneously. • Because the manufacturer or seller controlled the supply of product and services, it also exerted control over the marketplace. • Indeed, in these simple buyer-seller relationships, sellers always control the four major power elements in the marketplace.

35. The Distribution-driven Marketplace • This has come primarily as the result of retailers, distributors, wholesalers, or others form of channel organizations gaining control of the four marketplace building blocks. • It is now in the center of the system. From that central location channels control marketplace power. • That is, channels now dominate sellers and buyers.

36. The Interactive Marketplace • The basic structure of this marketplace began to develop in the early 1990s with the growth and expansion of various forms of electronic communication such as the Internet, the commercialization of the World Wide Web, and the develop of E-commerce. • This new marketplace will be radically different from those that have gone before. • Most important, it will, for the first time, put marketplace power in the hands of consumers rather than with the traditional producers or channels.

37. The Global Marketplace • Many organizations may have created cross-border production, distribution, and marketing systems that they are currently using to serve some clients. • In marketing communication, typically, they have centralized communication development with one headquarters group and pared the agency list to one or two global suppliers. • Through those efforts they have created what they call “global advertising campaigns”, generally based on some type of “one sight, one sound” marketing communication approach.

38. The Global Marketplace • In the true sense of global marketing communication, these companies have not yet moved into many of the realms of marketing and communication that we believe will be critical.

39. The Global Marketplace Those include: • Using an outside-in approach, that is, identifying and valuing customers and prospects that the organization is able to serve. • Allocating finite corporate resources against the most important customers and determining how much and where to invest those resources. • Finding new ways to balance the improvement of shareholder returns with services to customers on an ongoing basis.

40. The Global Marketplace 4. Building ongoing relationships with current and prospective customers that provide benefits to both parties. 5. Totally integrating the marketing and marketing communication activities of the organization, both internally and externally, to create ongoing, useful, interactive communication systems that bring the organization and its customers closer together.

41. Channel Channel Channel Media Media Media Media Media Marketer Information Information Information Historical Marketplace Twenty-First-Century Marketplace Current Marketplace Mktr Mktr Mktr Mktr Mktr Mktr Channel Customer Customer Customer Marketing Diagonal Marketing Diagonal Source: Don E. Schultz & Beth E. Barnes, Strategic Brand Communication Campaigns, NTC Business Book, 1999.

42. Marketing StrategicBasic Design • Segmentation • Targeting • Positioning

43. Moving from the 4Ps to the 4Cs Inside-Out Focus: Outside-In Focus: Product Customer Price Cost Place Convenience Promotion Communication

44. Marketing Strategic Transition From:To: • One-way telling Two-way selling • Advertiser’s choice Consumer’s choice • Consumer as target Consumer as guest

45. What is Internet Marketing? • Internet marketing is the process of building and maintaining customer relationships through online activities to facilitate the exchange of ideas, products, and services that satisfy the goals of both parties. (Dictionary of Marketing Terms, 2000)