Stakeholder Marketing

Understanding Stakeholder Needs : Understanding Stakeholder Needs Session 3

Motivation : Motivation It is an inner state the energises, activates or moves; that directs or channels behaviour towards goals. It is the recognition of a need, followed by the action to satisfy it.

Maslow’s Hierarchy of Needs : Maslow’s Hierarchy of Needs Physiological needs Food, water, sleep Safety /security needs Shelter, safety, security, reduced risk Social needs Belonging, relationships, identification with others Esteem needs Status, recognition, the regard of others Self actualisation needs Growth, fulfilment, realisation of potential

Involvement : Involvement The degree of perceived relevance or importance of a brand choice or other decision High Involvement decisions High risk, high cost, a lot of information required to make decisions Low involvement decisions Little risk ,little cost, little information required to make decisions

Perceived Risk : Perceived Risk The likelihood that a decision will lead to a net gain or loss for the stakeholder Types of perceived risks Performance Physical Financial Social Ego Time

Perceptions : Perceptions This is the process by which people select, organise and interpret data into meaningful and coherent pictures. External stimuli From the environment Internal stimuli Motives, interests, expectations and beliefs

Attitudes : Attitudes Are an enduring mixture of evaluations, feelings and tendencies which pre-dispose an individual or group to respond in a certain way to a given object and idea. A learned tendency to respond to something in a consistently positive or negative manner (Varey,2002). Attitude is an evaluation: what we feel about a concept (brand, category, person ideology)…

Changing attitudes : Changing attitudes Appeal to existing attitudes Powerful contrary information Changing behaviour

Groups : Groups Reference groups Groups with which an individual identifies so much that he or she takes on many of the values, attitudes or behaviours of group members (Dibb et al, 1996). Primary membership groups Generally informal groups e.g. family, friends, work groups Secondary membership groups Generally more formal e.g. professional bodies Aspirational groups Groups to which an individual would like to belong

Opinion Leaders : Opinion Leaders People within a reference group who because of special skills , knowledge, personality traits or other characteristics exert influence on others in regards to a particular product or decision area (Kotler et al, 1999).

Variables in buying behaviour : Variables in buying behaviour Stakeholders and participants in the buying decision The decision making process Various factors and characteristics which influence buyers perceptions judgement, choices and decisions.

Factors influencing consumer behaviour : Factors influencing consumer behaviour Cultural Culture Sub-culture Social class Social Reference groups Family Roles and status Personal Age and life cycle stage Occupation Economic circumstances Lifestyle and personality Psychological Motivation Learning Perception Beliefs and attitudes The buyer

A Consumer DMP : A Consumer DMP Recognition of the problem The search for information Evaluation of the options The purchase decision Post-purchase behaviour

Factors influencing industrial buying behaviour : Factors influencing industrial buying behaviour ENVIRONMENTAL Levels of demand Economic prospects Interest rates The pace of technological change Political and legal structures Competitive structures ORGANISATIONAL Objectives Policies Structures Systems & degree of centralisation Processes and procedures Managerial attitudes to risk Financial l resource Previous experiences BUYING CENTRE Roles in DMU Group processes Interpersonal interactions INDIVIDUAL Personal objectives Job position Attitude to risk Previous experiences Technical knowledge Motivation BUYING DECISION SOURCE: Adapted from Webster and Wind, 1972

An Organisational DMP : An Organisational DMP Problem recognition Product specifications Supplier search Evaluation of proposals Selection Order specification Performance review

Differences between B2B and B2C Marketing : Differences between B2B and B2C Marketing

Differences between B2B and B2C Marketing : Differences between B2B and B2C Marketing

Decision Making Unit : Decision Making Unit Deciders-make decisions that a product should be bought. Buyers-people who actually go out and buy the products. Users-the ultimate users of the product. Financiers-people who set the budget.

Decision Making Unit : Decision Making Unit Gatekeeper-controls the flow of information about the product or service. Initiators-individuals who first suggest the idea of buying a particular product. Influencers-these are people who stimulate ,inform or persuade at any stage of the buying process.

Stakeholder Marketing : Stakeholder Marketing Session 4

What is a relationship? : What is a relationship? It implies longevity It implies meaningful ties Recurring contacts, activity linkages, resources ties Implies commitment from both parties Special status, mutuality, trust and transparency, regularity and intensity of interactions, efforts to overcome differences

Types of Organisational Relationships : Types of Organisational Relationships One to One Chains and channels Networks

The core firm and its relationships : The core firm and its relationships The 6 markets model Internal Referral Influence Recruitment Supplier Customer

Transactions Marketing (TM) : Transactions Marketing (TM) Transactions are single market exchanges between an organisation and its customers or other stakeholders. It is an opportunity to maximise short term gains.

Characteristics of TM : Characteristics of TM The focus is on winning customers Increasing sale volume and market share. Satisfaction through product features and product quality. Heavy use of mass media Short term sales incentives to stimulate purchase. Little emphasis on customer service

Limitations of TM focus : Limitations of TM focus Seen as manipulative and exploitative. Inadequate in today’s maturing markets. It is expensive No long term orientation Fails to gather on-going feedback

Relationship Marketing : Relationship Marketing The process of creating, maintaining and enhancing strong, value-laden relationships with customers and other stakeholders. (Kotler et al 1999).

Relationship Marketing : Relationship Marketing Focus on retention Longer time scale Customer satisfaction through sustained value delivery Quality is the concern of all staff Concern with relationship quality High emphasis on customer service High, continuous customer contact High commitment to meeting customer expectations

Relationship life cycle : Relationship life cycle Relationship birth Relationship growth Relationship decline Relationship termination

Dwyer et al (1987) : Dwyer et al (1987) Awareness- awareness of potentially profitable exchange partners Exploration- establishing terms and sizing up obligations Expansion- continual increase in the benefits obtained by exchange partners Commitment- trust and mutual benefit thrive and partners intend to continue the relationship Dissolution- when the relationship has run its course.

Tsokas and Saren : Tsokas and Saren Four stage models Involves different relationship activities Requires different kinds of knowledge and information Develops different kinds of trust between partners

Tsokas and Saren : Tsokas and Saren Introduction Exploration and information seeking Experimentation Testing the relationship and appreciating each others capabilities Identification Closer and higher level collaborations begins to dissolve boundaries between partners Continuous renewal or dissolution- trust is integral at this stage

Criticism of life cycle models : Criticism of life cycle models Linear progression of models Degree of closeness or trust may rise and fall depending on partners needs. It assumes that all relationships go through these defined stages when indeed many never make it to the commitment or identification stage. Some people do not really want to deepen their relationships. The value is questioned in FMCG contexts.

Ladder of Loyalty (Kotler, 1997) : Ladder of Loyalty (Kotler, 1997) Prospects Potential customers who might be persuaded to do business with you Customers or Purchasers Those who have done business with you once; first time buyers Clients Those who do business with you repeatedly but may be neutral or negative towards the organisation Supporters Those who like you but may only support you passively by responding to your marketing Advocates Those who actively support your marketing through word of mouth endorsement, recommendations and referrals Partners Those who have become an active part in the value creating process.

Key Values of Relationship Marketing : Key Values of Relationship Marketing Service encounter Negative critical incidents Positive critical incidents Trust Reduces the perception of risk Transparency Commitment Intention or desire to continue the relationship and to invest in it. Co-operation and collaboration Mutuality Both parties benefiting from the relationships

Levels of Relationships : Levels of Relationships Basic Reactive Accountable Proactive Partnership

Approaches to Developing Relationships : Approaches to Developing Relationships Partnerships Strategic alliances Joint ventures Networks Virtual organisations E-relationships Customisation Internal customer relationships

Relationship Management : Relationship Management It is the process of analysing, planning and controlling organisational relationships, with the particular goal of leveraging more important relationships to the organisation’s benefits

It involves…. : It involves…. Gathering and analysing information on stakeholders Segmenting and prioritising stakeholders Developing plans for each key stakeholder relationship Coordinate information-sharing, communication and contacts Monitoring and evaluating the effectiveness of the relationships

Relationship Assessment : Relationship Assessment History and current stage Potential and Investment Atmosphere of the relationship Current operations

Database Marketing : Database Marketing This is an interactive approach which builds a database of all communications and interactions with the customer and other stakeholders and then uses individually addressable marketing media and channels to further contact them for promotional messages, help and support and relationship building initiatives

Customer Relationship Management : Customer Relationship Management Is an umbrella term for describing the methodologies and ICT systems that help and enterprise to manage its customer information and customer relationships in an organised and profitable way.

Customer Loyalty Programme : Customer Loyalty Programme These are specifically designed to incentivise and reward loyal behaviour such as repeat purchases, recommendations and referrals. They include schemes such as Air Miles.

Relationship Marketing Communications : Relationship Marketing Communications Multiple on-going customer contacts Two-way dialogue – B2C, C2B, C2C Personalised contacts

Benefits of Relationship Marketing : Benefits of Relationship Marketing Customer loyalty and Retention The economics of customer retention Competitive advantage Risk Management Support for Marketing Activity Value creation

Issues with RM : Issues with RM It is not a universal panacea for al marketing problems Not all customers will be worth the cost and effort of progressing up the loyalty ladder. Not all customers welcome it. Permission based marketing Privacy & Electronic Communications Regulations 2003.

Stakeholder marketing Mix : Stakeholder marketing Mix Session 5 and 6

Stakeholder Marketing Mix : Stakeholder Marketing Mix The marketing mix is a set of controllable marketing tools or elements which a firm can intentionally manipulate and coordinate to produce a desired response from its target markets. Product, Price, Place, Promotion. Stakeholder marketing is based on the idea that marketers need to understand the needs, concerns and expectations of different stakeholder groups, and adapt the marketing mix accordingly,- in order to create and deliver value for stakeholders and, return, to build trust, loyalty and commitment from them.

Product : Product Products are bundles or packages of benefits. Physical aspect Functional aspect Symbolic aspect Products should be Safe, environmentally friendly, more ethical, more socially responsible and compliant

Product and CSR : Product and CSR Product safety Packaging Branding and effects on developing economies Product discontinuation Product bundling

Price : Price Price can be defined as a measure of the value exchanged by the buyer for the value offered by the seller.

Pricing and stakeholders : Pricing and stakeholders Customers Suppliers Pressure groups Government and regulatory bodies Intermediaries

Factors Affecting Pricing : Factors Affecting Pricing Internal factors Marketing objectives Marketing mix Costs External factors Competition Demand Customer perception Suppliers and intermediaries Environmental factors

Stakeholders issue in Pricing : Stakeholders issue in Pricing Price fixing Predatory pricing Deceptive pricing Penetration pricing Price discrimination Discounting and dumping Profit taking

Place : Place This is connected with the selection of distribution channels to deliver goods to target customers, and with the storage and physical distribution of goods (logistics)

Place and CSR : Place and CSR Environmental impact of distribution Compliance with legislation Distributing through small local retail outlets Supporting franchises Supporting intermediaries to offer reliable and good levels of service Support reverse logistics Allowing wider and more equitable access to products and services

Factors affecting place decisions : Factors affecting place decisions The number of intermediary stages The level of support to be given to the intermediary, e.g. after sales. The extent to which the manufacturer wished to control the channel Customer preferences Product characteristics Distributor characteristics

Promotion : Promotion

Promotional Mix : Promotional Mix Advertising Sales promotion Public relations Direct marketing Personal selling Sponsorship Exhibitions Point of sales display Packaging Word of mouth

Above and below the line : Above and below the line Above the line Is advertising placed in paid-for media such as TV or print. It is based on payment by commission Below the line Used to describe activities where agencies typically earn a fee as opposed to a commission for buying media.

Advertising : Advertising An paid form of no-personal presentation and promotion of ideas, goods or service by an identifiable sponsor. Purpose To promote sales Create an image Support other promotional tools Offset competing messages To remind and reassure

Advertising media : Advertising media Radio, TV, Cinema, press, outdoor as well as online media Media choice is influenced by The size of the audience Type of audience Suitability of the medium for the message Cost of the medium

New media : New media Digital television Interactive television Interactive catalogues and newsletters SMS Web advertising

Personal Selling Activities : Personal Selling Activities Prospecting Communicating Selling Servicing Information gathering Allocating.

Advantages and Drawbacks : Advantages and Drawbacks High level of customer attention Customisation of message Immediate feedback Good for communicating technical information. Good for demonstration Aids development of long-term relations Main drawback Cost and could be time inefficient

Sales Promotion : Sales Promotion A range of tactical marketing techniques,designed within a strategic framework, to add value to a product or service, in order to achieve a specific sales and marketing objective.

Sales Promotion Objectives : Sales Promotion Objectives Achieve brand switching Incentivise consumers to make a forward purchase. Increase display space Smooth seasonal dips in demand. Generate a consumer database.

Consumer Techniques : Consumer Techniques Reduced price Coupons Competitions Free prize draws Premiums Frequent user incentives

Trade Techniques : Trade Techniques Baker’s dozen Cooperative advertising Merchandise allowance/discounts Tailor made promotion Sales contests Volume allowances

Evaluating Sales Promotions : Evaluating Sales Promotions Competition entries. ????????

Public Relations : Public Relations A planned and sustained effort to establish and maintain goodwill and mutual understanding between an organisation and its publics.(IPR)

Ten Basic Publics : Ten Basic Publics The community Potential employees Employees Suppliers of services and materials Investors-the money market Distributors Consumers/customers Opinion leaders Trade unions The media

PR Techniques : PR Techniques Press releases Press conferences Publications Media relations Events Annual reports Lobbying Internal PR

Evaluating PR : Evaluating PR Budget. Awareness. Attitude. Media coverage and tone. Share price. Etc…….

Direct Marketing : Direct Marketing The planned recording, analysing and tracking of customer behaviour to develop relational marketing strategies.(IDM)

Direct Marketing Mix : Direct Marketing Mix Television Radio Telemarketing Direct mail Home shopping Inserts Door to door Electronic media

Objectives of Direct Marketing : Objectives of Direct Marketing Increase sales Dissemination of information Generation of sales leads Generation of trial leads Undertake research/test marketing Support customers Information gathering

The Internet : The Internet Advantages Disadvantages

Evaluation of Direct Marketing : Evaluation of Direct Marketing Response rate Conversion rate Order value Repeat orders

Sponsorship : Sponsorship Entails supporting an event or an activity by providing money(or something else of value to the event organiser), usually in return for advertising space at the event and as part of any publicity for the event Types Programme sponsorship Arts/sports sponsorship Educational

Benefits / Weaknesses : Benefits / Weaknesses Benefits Standout Association value Cost effectiveness Precision targeting Blocking the competition. Weaknesses Restricted amount of information The agreement takes time OFCOM guidelines considered prohibitive.

Evaluating Sponsorship : Evaluating Sponsorship Media exposure. Awareness. Attitude change. Corporate image perception. Etc ……..

Services : Services

Service : Service Any activity or benefit that one party can offer to another that is essentially intangible and does not result in the ownership of anything. Its production may or may not be tied to a physical product (kotler et al, 1999)

Characteristics of services : Characteristics of services Heterogeneity Intangibility Inseparability Perishability Non- ownership

The service mix : The service mix People Processes Physical evidence

The service profit cycle : The service profit cycle Good internal quality Satisfied employees High profitability Employee retention Good external Service quality Satisfied customers Customer retention

Effective service encounters : Effective service encounters Reliability Responsiveness Competence Accessibility Courtesy Communications Credibility Security Understanding Tangibles Focus – customer first attitude

Relationship focused Mix : Relationship focused Mix Product------------------------Choice Price----------------------------Cost Place---------------------------Convenience Promotion---------------------Communication People-------------------------Care Processes--------------------Competence Physical evidence----------Consistency 7Ps-----------------------------7Cs

A Model of Integrated Marketing Communications (Fill, 1999) : A Model of Integrated Marketing Communications (Fill, 1999) Corporate mission,strategy and philosophy Harmonised marketing mix Coordinated Promotional mix Planned employee communications Other outsourced comm. Integrated Marketing Communications Customers,potential customers,channel members and other stakeholders

Measuring and evaluating the mix : Measuring and evaluating the mix

Stakeholder communications : Stakeholder communications Response/enquiry measurement Response (sales, enquiry, request for more information) coupons Response, enquiry telephone lines Website traffic monitoring Inquiry tests- comparing different campaign or media Recall tests Recognition tests

Measuring Relationships and their results : Measuring Relationships and their results Monitoring sales volume Monitoring customer complaints Monitoring supplier performance Monitoring shareholder loyalty

Tracking Studies : Tracking Studies This is technique used to monitor responses over an extended period of time. It monitors the variables before and after the marketing activity. Can be done by surveys or panel research

Financial analysis : Financial analysis Marketing expenditure against budget Profitability analysis Cost reduction Return on investments

Media Monitoring : Media Monitoring

Tools for gathering stakeholder feedback : Tools for gathering stakeholder feedback Feedback forms Survey questionnaires Attitude surveys Depth interviews

Behavioural indicators : Behavioural indicators Relationship duration Retention rate Defection rate

Internal Stakeholder Marketing : Internal Stakeholder Marketing

Definition : Definition Internal Marketing is concerned with creating, developing and maintaining an internal service culture and orientation, which in turn assists and supports the organisation in the achievement of its goals.

Factors in implementing internal marketing : Factors in implementing internal marketing Organisational design Regular staff surveys Internal customer segmentation Personal development and training Empowerment and involvement Recognition and rewards Internal communications Performance measures Building supportive working relationships

Internal marketing mix : Internal marketing mix

Internal segments : Internal segments Supporters Neutrals Opposers Or Christopher et al (2002) Contactors Modifiers Influencers isolateds

Slide 104 : Marketing Involvement Low High High Low Customer Contact

Challenges for internal communications : Challenges for internal communications Flatter structures – more people reporting Downsizing – work load issues Virtual working Globalisation – more diverse work force

Tools for internal communications : Tools for internal communications Email Advantages disadvantages

Tools for internal communications : Intranet Advantages Disadvantages Team meetings Informal channels - grapevine Tools for internal communications

Tools for employee retention, loyalty and commitment : Tools for employee retention, loyalty and commitment Motivation and rewards Job satisfaction Technical and managerial support Ethical and responsible employment practices Flexible working Organisational culture

International Stakeholder Environment : International Stakeholder Environment

Globalisation : Globalisation Definition The increasing integration of dispersed economic activities (Boddy, 2005) Factors driving globalisation Media and travel Transport ICT Political changes - new markets – EU Global brands from multinationals Business benefits of international marketing

Globalisation and CSR : Globalisation and CSR Arguments for International trade stimulates local economic activity It can bring investment, infrastructure, technology, skills etc May see improves in labour practices More choice, lower prices Good for international relations

Globalisation and CSR : Arguments against Encourages exploitation of labour It exports pollution Exploitation of local markets Job losses in developed markets Squeezes small, local businesses out of markets Globalisation and CSR

Challenges of International stakeholder communications : Challenges of International stakeholder communications Adaptation or standardisation Arguments for adaptation More effective marketing Differences in local audience Arguments for standardisation Economies of scale Consumer mobility Reduced risk

Challenges of International stakeholder communications : 2 – cultural and linguistic differences Language barriers Cultural differences Religious values Time values Business norms and customs Negotiating and decision making styles Gender roles Status differences Team working Challenges of International stakeholder communications

Challenges of International stakeholder communications : 3 Infrastructure differences Technology Time zone Media Transport infrastructure Challenges of International stakeholder communications

Overcoming the barriers : Overcoming the barriers

Technology and marketing : Technology and marketing Discussion of the implications for the organisations.