Introduction:
Marketing is the process of interesting potential customers and clients in your product or a service that you are offering. It is also fundamental to the growth of any business. Marketing is mistaken as just simply advertising. This is not the case as there are four main aspects of marketing (the four P’s). These are price, promotion, place and product. This is also called the marketing mix. There are also other aspects of the mix that are less important; which extend the mix. These include things such as people and the process involved.
1. The Chartered Institute of Marketing (CIM) defines marketing thus
- “Marketing is the management of the process responsible for identifying, anticipating and satisfying customer requirements profitably.”
2. Perhaps one of the widest definitions is offered by Kotler:
- “Marketing is human activity directed at satisfying needs and wants through exchange processes.”
In both ways we are defining marketing as a process which is mainly focused to create business with profit through customers. In both definition the most important and vital key word is customer which is playing a major part in business. So according to both definitions we can describe marketing as a way to gain the organizational goal though making the relationship between the organization &customer.
In anticipation of circa 1991 NEXT used a inferior case Courier-style font in black aligned with a white backdrop for its logo. This was replaced by the capitalised NEXT logo in a Roman-serif method type face that is still usually used in supplies and commercial marketing. Next Clearance which sell previous seasons stock at a lower price than the core Next stores. The Lime stores replace existing Next outlets which have since moved to larger premises nearby. Lime-branded items are also now stocked at larger Next Clearance stores. Lime was setup primarily as competition for low cost competitors such as Primark, Peacocks, Matalan and the clothing operations of supermarkets such as Tesco, Asda and Sainsbury’s
Literature review:
Company history:
The NEXT Company was founded by Joseph Hepworth in Leeds in 1864 as a tailor under the name of Joseph Hepworth & Son. The Company was listed on the London Stock Exchange in 1948.
In 1982 the Company bought Kendall & Sons Ltd, a Leicester based rainwear and ladies fashion company from Combined English Stores, to redevelop their stores as a women swear chain of shops. Terence Conran, the designer, was Chairman of Hepworth’s at this time and he recruited George Davies to create the unique NEXT concept using the Kendalls shops. The first stores were opened on 12 February 1982, and by 1983 all 80 of Kendall’s stores had been converted by Davies to the NEXT brand.
In Autumn 2009, Next launched an online catalogue for the United States offering clothing, shoes and accessories for women, men and children.
Operation:
Next sells some of its merchandise through the Next Directory, a home shopping catalogue launched in 1988. Most Next stores only sell their own brand label although recently a number of larger Next stores such as Meadowhall have begun to sell branded goods such as trainers from Gola and Morphy Richards electrical goods. More recently the company has begun to tap into the growing market for trendy men’s underwear by stocking the latest styles of Calvin Klein and Vishal Vora underwear. The Next website has recently seen the addition of a large brand section with names such as Firetrap, Levi’s and Rock and Republic.
Next produces an internal magazine called ‘The Faith Restorer.’ This includes reports on new store openings, recent events (such as conferences or news on advertising campaigns), contributions provided by stores, good customer service and the ‘What not to say’ column that reports on recent complaints and advises employees on how to avoid them.
Main Characteristic of marketing:
Superior Value: The companies always try to be close with customer to understand them well and to create superior value for them.
Long Term Profit: Long Term Profit: The marketing oriented organization is always following the marketing strategy which is long term, flexible and strategic focus on organizational goal.
Customer: For the company the main key word is customer. Marketing oriented company does gather their all resources to fulfill the need of the customers.
Competitor orientation: Always keep concentration about competitor as competitor always affect business.
Stakeholders: Taking stakeholders as a vital part of organization & taking their opinion before making any important decision.
EFFECT OF MICRO & MACRO ENVIRONMENTAL FACTORS
MICRO FACTORS
Customer: Next always give their full effort to satisfy the customer & their needs. This chain shop’s attempts to make their product more attractive by offering high quality clothes to the customer at the same time they give to satisfy their customers with the verity of needs by giving standard customer service.
Competitor: Next has so many competitors such as John Lewis, Peacock etc. Next deliver good quality clothes and other stuffs & standard customer service to beat their competitor. Next try to give varieties type of offers on clothes to attract customer to give tight competition to John Lewis& Primark who have big portion of customers from market.
Suppliers: Next do follow some marketing strategies to keep good relationship their supplier though which they can make their business more profitable. Next follows some important way to maintain good relationship with suppliers such as Foundation blog, Fair trade.
Distributors: Next distribute their product themselves. Next produce wide range of products with own labelled. They are having the target to serve the customer with high standard customer service of being cost effective.
MACRO FACTORS
PESTAL Analysis:
POLITICAL FACTORS: Next runs their business with political factors such as they need to take permission from government to run their business;
Open a new branch
Sell different variety of Staff (Clothes, shoes etc.)
Health and safety procedures
ECONOMICAL FACTORS: Like other companies NEXT do influenced by economical factors. Next has currently 7% of share of the cloth market.
But like other companies NEXT even had bad affect by the credit crunch.
SOCIO-CULTURE FACTORS:
Next has aim to encourage the children’s to know about the different varieties of stuffs.
Next offers a huge variety of demonstrations and events for adult and children.
Next gives their staffs proper training to make their efficiency higher.
TECHNOLOGICAL FACTORS:
Start online shopping
Free deliver products to customer
Card payments and some NEXT have cash point.
LEGAL FACTORS:
- NEXT keeps the legal bond with other bank
services.
- Next maintain the government act of provision
their business.
ENVIRONMENTAL FACTORS:
Next play very important part to reduce the waste in environment.
They have contribution to recycle their products which are mainly worn away.
Market segmentation:
Yoram Wind and Richard Cardozo (1974) suggested industrial market segmentation based on broad two-step classifications of macro-segmentation and micro-segmentation. This model is one the most common methods applied in retailer markets today. It is sometimes extended into more complex models to include multi-step and three- and four-dimensional models.
Macro-segmentation centres on the characteristics of the buying organisation, thus dividing the market by:
* Company / organization size: NEXT is one of the most practical and easily identifiable criteria, it can also be good rough indicator of the potential business for a company. However, it needs to be combined with other factors to draw a realistic picture.
* Geographic location is equally as feasible for NEXT. It tells NEXT a lot about culture and communication requirements. For example NEXT would adopt a different bidding strategy with an Asian customer than with an American customer. Geographic location also relates to culture, language and business attitudes.
* Benefit segmentation: The product’s economic value to the customer (Hutt & Speh, 2001), which is one of the more helpful criteria in NEXT shop. It recognises that customers buy the same products for different reasons, and place different values on particular product features. For example, the access control in NEXT markets the same products for two different value sets: Banks, factories and airports install them for security reasons, i.e. to protect their assets against.
Micro-segmentation on the other hand requires a higher degree of knowledge. While macro-segmentation put the NEXT business into broad categories, helping a general product strategy, micro-segmentation is essential for the implementation of the concept. “Micro-segments are homogenous groups of buyers within the macro-segments” (Webster, 2003). Macro-segmentation without micro-segmentation cannot provide the expected benefits to the organisation. Micro-segmentation focuses on factors that matter in the daily business of NEXT.
* Buying decision criteria (product quality, delivery, technical support, price, supply continuity). The NEXT divide the market based on supplier profiles that appear to be preferred by decision-makers, e.g. high quality – prompt delivery – premium price vs. standard quality – less-prompt delivery – low price.
* Purchasing strategy, this falls into two categories: First, NEXT contact familiar suppliers and place the order with the first supplier that fulfils the buying criteria. These tend to include more OEM’s than public sector buyers. Second, NEXT consider a larger number of familiar and unfamiliar suppliers, solicit bids, examine all proposals and place the order with the best offer.
Targeting strategy:
NEXT try to get all type of customers according to their price. They give varieties types of offer to attract customers such as half price or 10% off on specific product. NEXT is usually finished with pink walls and paying more attention on lighting in important part of the stores such as service counters, dress for man, women and children section and other section well which is attracting customers to store in NEXT as some time the customers take it as a state issue to store from NEXT.
NEXT targets the busy customer who wants shop physically from the store; for them NEXT has online shopping system and free delivery as well.
Buyer’s behaviour affects marketing activities:
“The decision-making process by which formal organizations establish the need for purchased products and services, and identify, evaluate, and choose among alternative brands and suppliers”—Kotler and Armstrong (Principle of Marketing; 1989)
There are two types of buyer behaviours:
* Consumer buying situation: consumers are who bye the product for personnel needs.
� For customers physiological needs NEXT have varieties option; e.g. meal offer named Ready prepared.
� NEXT delivered daily used product named Essential NEXT.
� To attract the customers NEXT suitable price for the product.
� NEXT have a option named Feasible Planning to help customers to plan the party.
Industrial buying situation: industrial buyers are who bye the product not to use for them to use for their business. For my selected company NEXT; it has industrial buyers. Because NEXT produce product with own labeled and branded what few of others used in their business.
Marketing Mix:
The concept of the marketing mix and its 4Ps were introduced by Professor Neil Borden in 1965. Soon they became the unchallenged basic model of marketing, totally overpowering previous models and approaches to the marketing concept. It is defined as the set of controllable tactical marketing tools that the firm blends to produce the response it wants in the target market.
Product means the totality of ‘goods and services’ that NEXT offers the target market. The NEXT ‘product’ is clothes associated with “full cotton”, “febric” etc. NEXT offers several services, the main elements are cotton febric is tangibly distinguished by the uniformity of environment, color, and style of graphics and apparel, and the consistency of delivery.
Place includes company activities that make the product available to the target customers. NEXT maintains a body of independently owned franchise that sell the clothes. They select the franchisee carefully and place it so that the consumers may have easy access to the product.
Price is what the customers pay to get the product. NEXT suggests prices that each franchisee might charge for each product. They offer better services and quality to attract customers to bring the price into line with customer’s perception of NEXT products.
Promotion means activities that communicate the merits of the product and persuade target customers to buy it. NEXT spends millions on advertising each year to tell consumers about the products. NEXT assists potential consumers and persuades them that it is the ideal place for them to enjoy the meal. NEXT and its Franchisee’s offer special deals on.
The 4Ps represent the seller’s view of marketing tools available to influence the consumers. From a customer point of view, a marketing tool must deliver a customer benefit. According to Lauterborn (1990), the 4Ps model was altered by Brunmer (1989) and became the customer’s 4Cs: Customer needs and wants (to replace product), Cost to the customer (to replace price), Convenience for the buyer (to replace place) and Communication (to replace promotion).
MARKETING MIX IN CONSUMER MARKET
“The decision-making process by which formal organizations establish the need for purchased products and services, and identify, evaluate, and choose among alternative brands and suppliers”—Kotler and Armstrong(Principle of Marketing; 1989)
There are two types of buyer behaviors
Consumer buying situation: consumers are who bye the product for personnel needs.
For customers physiological needs NEXT have varieties option; e.g. Cotton febric offer named Elite prepared.
NEXT delivered daily used product named Essential NEXT.
To attract the customers NEXT suitable price for the product.
NEXT have a option named Party Planning to help customers to plan the party.
Industrial buying situation: industrial buyers are who bye the product not to use for them to use for their business. For my selected company NEXT; it does not have industrial buyers. Because NEXT produce product with own labeled and branded what other’s can not use in their business.
Managing and organizing activities:
Although NEXT employ democratic management style, which makes it logical for them to incorporate a task culture, adaption must be made in order to suit employees so that they are satisfies this will lead to motivated employees which are beneficial for NEXT. This is because employees in the UK have different needs and wants compared to employees in Germany and France. This is because they live in a different type of country where their interests are different due to their culture and the different behaviour. Due to the cultural differences, employees will live different lifestyles and therefore, will work in a different way to employees in the UK.
Currently, employees in the UK’s NEXT are satisfied with the democratic management style that enables them to delegate authority to other employees and are happy to take advice from other employees who specialise in a certain area and therefore are experts. This may not be the case in Germany and France because they feel they are being lectured and feel that NEXT is undermining and makes them feel like they are unable to complete their work properly. Therefore it is likely that employees in Germany and France will be satisfied with Laissez Faire management style because it enables them to make decisions by themselves as Management give employees full responsibility because they feel they are capable of completing their work correctly and efficiently. Employees are therefore motivated by this management style because they are trusted and do not feel they are being watched over constantly.
Due to NEXT incorporating a Laissez Faire Management style it is logical they utilise a role culture. This is because employees are given a defined job and are given power. Therefore this business’s culture is suitable.
NEXT utilise motivational theories such as Abraham Maslow and Douglas McGregor in the UK. This is because these theories apply and are suitable for employees in the UK, which therefore motivates them. This is because of the cultural differences between Germany, France and the UK is likely that employees are motivated by different motivational theories compared to the UK as they are applicable. So it is vital that NEXT investigates the different motivational theories incorporated by businesses situated in Germany and France as well as observing employees behaviour and identifying their wants and needs so that they are aware of what factors motivates employees. They could then make these applicable changes to the way NEXT operates so that they suit the employees of Germany and France.
Conclusion:
It is vital that NEXT minimise threats visible in order to become competitive and maintain success and profitability. The major threat present in expanding NEXT in to France and Germany is the inability of satisfying the needs and demands of the consumers situated in France. This threat is major because consumers are vital for a successful business because the organisation is established to meet their needs and wants, resulting in sales and profits. Unsatisfied consumers lead to poor sales, causing a lack of profits resulting in an unsuccessful business that is forced to cease trading which can cause bankruptcy. So in order for Next to prevent these problems arising it is vital that they satisfy their consumers and develop their client�le base. This can be achieved by observing and researching the market in France and Germany in order to comprehend the consumers with the countries. NEXT will be expanding therefore they could provide consumers with goods and services adapted to suit their wants and needs. Therefore sales will increase resulting in high profits and a successful and competitive busine One of Next’s main opportunities is the size of the market in France and Germany due to the large population. Therefore Next can target their goods and services at a larger market and therefore have more potential customers. This will lead to an expansion in the client�le base. ss which will maintain a good corporate image.
References:
Evans, N., Campbell, D., & Stonehead, G,. (2003). Strategic Management for Retail Business. Oxford: Elsevier.
Exploring corporate strategy, Johnson and Scholes, 6th edition
NEXT, (December 2009) The Company Media Centre [online] Available: http://www2.next.co.uk/thecompany/mediacentre/yourquestions/generalfaq/q3.shtml [Accessed 18 December 2009]
Queensland University (2002) Gap analysis model [online] Available: http://www.catalyst.uq.edu.au/designsurfer/gap%20analysis.jpg [Accessed 18 January 2009]
FAME package (2005) [online] Available: http://fame.bvdep.com/ [Accessed 17 January 2009]