...To any layperson, marketing is likely to incite images of celebrity endorsements and cheesy catchphrases touting new and improved goods or services; a product of basic creative and artistic thoughts derivative of bureaucratic business people. Thankfully, marketing connoisseurs know better. Behind these attractive faces, blurting out catchy one liners, while holding the hottest product on the market, is often hours of quantitative and qualitative research using analytical frameworks followed by weeks of strategic planning (Rao and Steckel, 1998).
This endless terrain of research and analysis pays testament to marketing's hugely significant role to a business's ability to outperform its rivals. It is a central dimension of the entire business, it is the entire business witnessed from the point of view of its end result, that is, from the consumers point of view (Wilson, 2010).
As the economic environment grows further complex and multifaceted, as does the most appropriate and effective marketing methods. Issues such as globalisation, changing customer behaviour, rapidly changing technology, and the innovative, new working methods of competitors continue to repeatedly plight modern day organisations.
This essay will seek to assess and critically discuss the value of using marketing simulations and analytical frameworks, such as PESTLE, SWOT and porters 5 forces by measuring their ability to eradicate or assist in the tackling or prevention of these topical issues. An organisation's ability to tackle these issues strategically will also be discussed, in order to indicate that the focus is not purely on the day-to-day implications of and organisations decision making, but primarily the major and long-term effects (Salaman, 1997).
Although the overarching message of this discussion will be to stress the importance of strategic planning, prior to formulating strategy it can be beneficial to draw any existing easily accessible information together, to better understand a business's position (Finlay, 2000). A useful tool of this brief view is a SWOT table, a basic graph highlighting the strengths and weaknesses of the internal environment, coupled with the threats and opportunities of the existing environment (IBIS). It is relatively easy, fast and cost effective to construct a SWOT table, motivated by near-future influences and quick fixes, however it is much harder to construct one that focuses on the truly strategic and the longer term, and should not be typically used as such (Srdjevic et al., 2012). Performing a SWOT analysis can help organisations to recognise the areas where instant, fast strategic choices must to be taken either to take advantage of strengths or to ovecome a threat (West et al., 2015).
A helpful example is presented within Strategic Management (2000) in which an airline is presented as having the opportunity to exploit the strong demand for cheap fares with the strength of their lower expenses relative to competitors.
To remain competitive, organisations are required to analyse the various factors in the external environment and examine the possible impact of these factors on the business's happenings. Most organisations are expected to anticipate changes in the external marketing surroundings and be equipped to acclimatise their activities appropriately (West et al., 2010). The analysis of the external environment should be an ongoing process, since the factors identified may provide understandings into issues for the future or opportunities for new feats (Cadle, 2010).
An issue handicapping a firm's ability to anticipate change is that of globalisation. Globalisation is the process by which the social relations between human beings have tended to extend globally, to cover the territorial and demographic space of the entire planet. Development of trade between countries (Zolo, 2007). A term indicating both new opportunities and similarly, new anxieties and tensions; this is due to the greater numbers of social players at economic, political, cultural and communications events which had only existed in isolation prior, separated by geographical remoteness or numerous versions of cultural and social hurdles (Langhorne, 2001; Zolo, 2007).
In the macro environmental context that is globalisation, the variables are enormous and can be clustered in various ways, most notably being the PESTEL model, as recommended by Cadle (2010) and West et al (2015). Consisting of factors such as Political, Economic, Social, Technological, Legislation and Environmental, this can help provide a more detailed, telling picture of the situation facing an organisation when going global and/or entering new markets, allowing for better preparation and knowledge (Cadle, 2010).
Table adapted from Srdjevic et al., 2012, figure 2
Srdjevic et al (2012) further indicated PESTEL as a major pillar of a developed approach, due to its ability to identify the factors influencing a given system (in this context, a market/nation), their impacts, and their positive effects on the system. For example, when launching in China, Apple failed to account for the enhanced competition amongst the technology market, further failing to realise the minimal prices by which mobile phones are being sold there provided the reduced median house hold income relative to that of the western world. An effective strategic planning process utilising an effective analytical tool such as PESTEL will have ensured a disciplined approach to marketing, ensuring no key aspect had been overlooked (Sorger, 2012). In many instances, multicriteria analysis using the related optimization tools is essential to reach the finest answers, and as such, a SWOT analysis may have also been a helpful supplement used to measure the threats of each factor within the PESTLE system, this may have allowed for any threats to have been faced, or furthermore, forced them to withdraw from the idea entirely (Srdjevic et al., 2012).
Langhorne (2001) attributes globalisation to the advancements in the field of technology, breaking down many tangible barriers to worldwide interaction, which in the past, limited business efforts. These developments not just resulted in the behavioural change of businesses however, but also that of customers, unforgivingly influencing consumer demand and behaviour correlatingly. This change amongst consumers as a result of technological advancement, as well as the growing power held influencing market structure is illustrated by the latest British Retail Consortium figures concerning the consistent growth in online retail market sales relative to in store purchases, in which nearly a quarter of sales took place online in January (Chen and Wu, 2005; Rigby, 2018). Equated to the emergence of companies such as Amazon and ASOS, it is becoming increasingly clear that the online retail market is worth entering, but how would an organisation analyse its chances of success? Marketing success is rarely based on chance. Often the result of a carefully prepared and executed marketing plan. A marketing plan is a written plan that covers the situation, objectives and actions for an organisation for the time period covered, typically a year. Based on: strong outline, deep market knowledge, and enterprise-wide collaboration. (Sorger, 2012)
...(download the rest of the essay above)