Student’s Name
Professor’s Name
Course
Date
Marketing.
Evolution of Marketing.
Since the resurgence into the computer and internet world of the 1980s, running businesses have taken a 3600 turn. Since that time, to date, a significant evolution has taken charge of marketing. Great and flourishing firms have resolved to online marketing and cutting on issues about locating distributors and retailers at different places of their target market. The instance of a company that fully embraced the evolution and was able to realize good fruits is the Ali Baba of China, which Jack Ma is the CEO and founder. Through online marketing, this Chinese company was able to hit high levels in the shortest time possible, making the whole world its market target.
This course puts clear the subject on the “evolution of market” through the emphasis it sets on the information age with the network economy. The presence of the internet and social media platforms has been a significant boost and of positive impacts on marketing. Any companies that have embraced these platforms have or making milestones regarding their sales. Among the effects that the internet has had in marketing, the world is that it has stiffened competition between companies globally. With online marketing, all companies have had an equal market chance and eliminated the issue of monopoly by individual companies that dominate specific areas of the globe. With the ease of access to information, customers through the internet are also better placed. It is way easier to get a company to work with or hire to supply specific goods or provide services. Through this, big companies have the strength and an added advantage to grow even more significant. For small companies, it is only necessary that they revise and rebrand their services, and utilize the internet to develop through the levels fast enough. Social media is another aspect that has had a significant transformation in marketing performance. According to the information gathered in this course, social media carries the highest number of people connected through it. Through this, therefore, information sharing by and between friends gives the customer better bargaining power and more selling windows.
Application in Commercial World.
Unlike the traditional trend, the evolution of marketing through the internet changed the narrative. Instead of mass production, enabling a company gets the economy of scale, it has turned to mass customization aimed at getting the customer’s satisfaction. Many companies across the planet are currently more focused on satisfying the customer as opposed to just mass production. Applying this has proved a result as most people do not visit the companies to determine how big or small they are before purchasing their goods and services. Investing more in the online market thus serves a better purpose than aiming at production. Market sales, as determined through online markets, are, therefore, the determinants of the scale of production. Other factors that are applied to the commercial world today is direct marketing to the end customers. Companies, since the inception of the information age, ceased to install distributors and retailers to market their goods/services. Through electronic platforms, it is easy to reach customers and make more sales with less labor set on the ground.
The evolution of the market has also enabled the change in market approach by allowing a prompt to get customer feedback. This customer feedback is what allows data analysis to determine the performance of the company. Though knowing how the company is performing from the feedback that the customers give, then the loopholes are quickly identified, and ways of sealing them found. In addition to this, the application of marketing strategies helps save the company a bunch through improving sales and realizing better profits. Among the strategy is; having data-driven marketing, optimizing videos, personalizing customer experiences, utilizing daily updates through success stories, and boosting social media presence (Ross, Canning & McDowell, 17). Applying these market strategies in any business has proved to work miracles. The obtained results out of it are just incredible. The market strategies, according to this course, are the tools to fight the stiff market competition, keep up with the global economy, and cut on the labor costs. This is because they are these three factors that control the market trends.
Development in the future.
Much as this course gives details of the current and past market trend and the impact the evolution has had, it also gives an insight into what the future is most likely to be like. As a part of the current trend, there are integrated systems that enable the customers to conduct everything online and have their goods delivered at their doorsteps. Through these systems, customers can check, order, purchase, and pay online and have their goods delivered. They are equally able to track the delivery of their products through a mobile device or personal computers. The future trend is, on the other handset to take a slightly different course from this. This trend is bound to be customer-oriented. It is a shift from product-oriented marketing that focuses on awareness, interest, desire, and action. This is shifted to a customer-oriented market for the future trends that aim at knowing the customer, their needs, satisfaction, and loyalty. To be able to achieve this, the prospects aim at fast delivery of products. This will entail technological advancements in such a way that one receives their good almost instantly. The time-lapse between ordering and delivery is supposed to be minimized as much as possible.
In the future market trends, the internet is still expected to take the lead. Interactive marketing is expected to take the lead. Unlike the current and past trends, interactive marketing creates a two-way dialogue between the business and its customers. Taking a case study of Ali Baba that has rocked the whole world and now a multi-billion-dollar company, the management focuses on direct customer relationships as opposed to having distributors and retailers. This is as a result of understanding the customer needs and keeping up with the technological trends. Should the company keep up with the anticipated future trends, it’s bound to keep and even better its sales.
Value Creation.
By definition, value creation is the performance of actions that are aimed at increasing the worth of services, goods, or the business in general. It is the primary aim of a business entity. The four vital aspects of value creation are; resource-based view, systematic analysis, using research studies, and Information Technology enabled services. A resource-based look aims to highlight the differences that exist between firms. The different resources that companies use, including technique, labor, people, and the general know-how is what makes a company unique. These aspects can either attract and maintain customers or keep them away. Technique and broad expertise go hand in hand with product quality, which is a vital aspect that is in most times utilized in marketing. For a company to maintain a Sustainable Competitive Advantage (SCA), its resources speak volumes. Other utilized strategies other than resources, is knowing when to use RingBack Tone advertising (RBT) and Political, Economic, Social, and Technological factors (PEST).
To be able to generate Sustainable Competitive Advantage (SCA), Barney, in 1991, presented a more concrete framework. The outlined characteristics included: having non-substitutable resources, valuable, and non-imitable but rare resources. Inimitability, on the other hand, is categorized in stages, from those that are easy to imitate to those that cannot be imitated. For the resources that are difficult to imitate and those that cannot be imitated, display specific unique characteristics as brand loyalty, employee satisfaction, having individual assets and location, and patents. A patented resource is protected by the law, and thus the company is at liberty to carry out its internet marketing without the fear of losing its brand to other companies. Through the main characteristics of SCA, the Barney relationship can link resource characteristics to the competence of the firm.
Application in the Commercial World.
Firm resources are categorized into four, namely: Physical capital, social capital, customer capital, and organizational capital. These four categories are all widely applicable in the commercial world. Organizational capital aims at the coordination and control of a structure. Human capital is focused on training, relationship, relationships, and insight of individual managers and workers in a firm. Physical capital, on the other hand, takes care of physical technology, equipment, and access to raw materials. Lastly, customer capital is applied in the commercial word in terms of taking care of the effectiveness of marketing channels and taking care of the knowledge about customer preferences.
Intellectual capital can be linked with the resource-based theory to generate the customer’s value. The four forms of capital, combined with external resources through partnerships with suppliers, help develop capabilities that are critical in the commercial world. These capabilities are thus aimed at satisfying the customers’ demands. Ultimately, when the customers’ needs are met, then the firm can compete favorably in the market. It thus becomes a smooth run for the company to market its products, provided the customers, who are the ultimate targets, can be satisfied. The value-creating process is another critical aspect that is applied in the commercial world. Under value-creating are aspects such as Research and Development (R & D), which is so significant in the amelioration of the marketing of any company’s products. R & D focus on long-term marketing success and profitability when used in any business. Other aspects encompassed in the value-creating process are production, logistics, and service marketing. All these aspects target the consumer whose value is determined by the product and service features, culture, the organization’s reputation, sales channel, and the payment convenience. For a company to be able to compete in the commercial world, aspects of efficiency and effectiveness are equally important.
Insightful Development in the Future.
Marketing of the future regarding value creation comes from the fact that mobile devices, that is, smartphones and tablets, are set to become the center of marketing. In value creation- generating and fulfilling needs, the employment of artificial intelligence would play a key role. AI marketing would play a role complex learning algorithm for modeling high-level abstractions. As the current trend focus on co-creation and co-production, the future is expected to go a notch higher. In this regard, there are expected issues to do with smart shelves. This will reduce the hustle and tussle of handling goods. With the existence of interactive shelves, “virtual” supermarkets, and virtual fitting rooms, one will be able to purchase and have everything delivered without them having to move around. After product creation, shipping by drones is expected to be another milestone in the future retail trade. The use of courier services for delivery is bound to come to an end with this new development in place then.
In this course, it is also evident that the future is bound to restructure the economy to what is referred to as a sharing economy. Optimized scenarios will help in the removal of inefficiencies. Utilizing ideal resources, reducing market entry barriers, and rebuilding the monitoring and control of service quality is among the activities to foresee the optimization scenarios come to effect in the future.
The sharing economy, through the spread of mobile computing and access to the internet, has fostered the emergence of a new consumption model. This is expected to have transactions increase by over 25% by 2025. The main sectors of focus in this are freelancing, transportation, finance, and accommodation. Marketing opportunity analysis is also supposed to be put into consideration by introducing new-to-world value. This is regarding customizing offerings like what Nike does and adding new expertise as in mturk. Platforms are equally supposed to be utilized as a means of service. This would make a chain flowing from Innovative Technologies, Information systems, platforms to services. These platforms are bound to being, business to consumer, consumer to consumer, and business to business. Value creation of luxury brands is also expected to take effect as a part of future developments.
Hybrid Consumer.
From what I learned in this course, I can define a hybrid consumer as one who does not fall in any distinct and stable category. It is a general trend with them to seek cheap, low-value budgets, discount or generic goods, and at other times sort for expensive (premium or high-end) options. They are what today’s customers are like. It is their nature to be contradictory and unmanageable, unpredictable, and volatile. Such a kind of consumers cannot be defined by consumer income levels or other demographic factors. It is thus noted with a lot of concern that consumers are generally proud of being what can be referred to as “smart shoppers.”
With this new form of consumers, they are hardly understood as their steps cannot be predetermined. They are capable of flying in a budget airline only to go and stay in an upscale hotel. This trait raises so many questions at tough decision making processes for marketers amidst trying to accommodate such types of consumers. It is undoubtedly hard to determine what drives this type of consumer behavior and the significance of the trend towards hybrid consumption.
Upon redefining consumption, it ceases to be a matter of fulfilling needs. The redefinition brings in a new aspect of perceptions, social relations, and images. Both the trading up and trading down points come into play in this case. In this case, a company or supplier is able to fit in what the consumers want at some level.
Viewing hybrid consumers from another angle is consumer commitment levels. In this category, those consumers with transactional behavior are likely to have a short time horizon. On the contrary, those with relational behavior imply a long time horizon. Regarding these issues of commitment levels, personality traits also come into play. Personality traits push one to focus on whether the purchases they are making or are about to make are mere luxuries or necessities. Ones’ self-control thus determines these purchases. Those with low self-control are most likely to trade up, for they will consider luxuries as necessities to them. On the other hand, those with high self-control may turn to restrictive purchasing, which is associated with trading down. In both cases, hybrid consumers generally don’t prefer middle markets.
However, hybrid consumers are categorized into three main categories. These categories are polarized hybrid, omnivorous hybrid, and traditional consumers. Traditional consumers trade up for smaller indulgences and little luxuries that they could easily consume without guilt. This category of consumers does not buy great lifestyle luxuries or aspirational luxuries. Omnivorous hybrid consumers are described to always try to find the best value all the time. They consider it too much work for continuous bargaining as they try to find value. As opposed to traditional consumers, they exhibit a lesser desire for luxuries. This indeed creates a lower need to trade down. These consumers have multiple life themes and identities, for instance, having a good mother, an attractive wife, and a competent career woman all in one. Some of these identities end up conflicting. The last group is of the polarized hybrid consumers. This category is made up of the urban young, well educated, lively, and creative people that focus more on standing out other than blending in. To achieve this art of being outstanding, they got to focus on fashion and clothing. These kinds of people can be referred to as self-fulfillers. They trade up because they feel good in luxuries though at times, they also continuously trade down. Upon trading down, they find it more rewarding because it teaches them to spend more on things that matter.
Another vital aspect learned in this course was the trading categories. Both the trading up and trading down have their subdivisions. Trading up types includes high-involvement, high switching cost, decretory spending, and the durables. Trading down, on the other hand, is divided into; low involvement, low switching cost, low risk, fast-moving consumer goods, and products for private use. Personal value is what determines the trading down category. Another unique type other than trading up and trading down is the mix and match in the same category. Some hybrid consumers, at a time, mix and match both the expensive and cheap things within the same category. For example, there are those hybrid consumers who trade down for goods like t-shirts and trade up on shoes and accessories that have a more significant impact on their style. In other cases, some hybrid consumers tend to trade down on air tickets to save money they will spend for a better place at their destination, like in a better hotel. For all the above mentioned and discussed categories, we have other factors that influence people to fall in either group. Situations, that is, the importance of situational benefit of what one needs is what makes them trade either up or down. Another critical aspect that has a significant influence is the value for money. This includes benefit-cost, quality and durability, experience value, and aesthetic values. All these aspects under the amount of money influence either trading up or down.
- To sum up, hybrid consumers have their own unique behavior too. These behaviors are classified as dominating and supplementary drivers. Dominating drivers are mostly geared towards caring for oneself and connecting with others, while supplementary drivers are focused on self-actualization, pampering, and aesthetics. Since the hybrid consumers may not even realize the connection between their trading up and trading down in their choices, market strategies thus become essential to cater for such a situation. Working and concentrating on emotional values enables companies to avoid competing on prices. It, therefore, becomes necessary to work to turn needs into wants through differentiating their offering on an emotional dimension. Emotionally engaging the consumer helps companies improve their margins and competitive positions. For firms in the discount segment, a strategic focus on price and further improvement of the no-frills alternative through cost-effectiveness and quality controls seems the best option.
Reference.
Brennan, Ross, Louise Canning, and Raymond McDowell. Business-to-business marketing. SAGE Publications Limited, 2020.