Marketing Management Reconsidered PDF

WHAT IS MARKETING? MARKETING MANAGEMENT RECONSIDERED | S1: Introduction to marketing management in a constrained world 24  MARKETING MANAGEMENT DEFINITION Marketing management covers the coordinated marketing practices implemented by organizations to achieve their object...

WHAT IS MARKETING? MARKETING MANAGEMENT RECONSIDERED | S1: Introduction to marketing management in a constrained world 24  MARKETING MANAGEMENT DEFINITION Marketing management covers the coordinated marketing practices implemented by organizations to achieve their objectives. ⇒They include: Studying different audiences, their needs, uses, desires and aspirations, Creating products, services and experiences, Disseminating these offers in a commercial or non-commercial context. Source: AFM definition (2015) MARKETING MANAGEMENT RECONSIDERED | S1: Introduction to marketing management in a constrained world 25  A BRIEF HISTORY OF MARKETING Birth of marketing in the late 19th century sales techniques to stimulate demand and develop markets, to sell off mass production a Taylorist approach to business Ad in the Saturday Evening Post (USA, 1931) launch of brands such as Coca-Cola (1886) and Heinz (1888) Mass consumption development during the post war boom (1945-1975) a period of high economic growth consumerism as a path to well-being development of mass market retailing Start of marketing rethink in the 70s criticism of mercantile and manipulative motives criticism of the social and environmental effects on society launch of brands such as Patagonia (1972) and The Body Shop (1976) MARKETING MANAGEMENT RECONSIDERED | S1: Introduction to marketing management in a constrained world 26  MARKETING TODAY Consumers’ viewpoint  an overall negative perception of marketing by consumers Glacier National Park, Travel Montana 2009 campaign “There’s nothing here” (budget = $800,000) MARKETING MANAGEMENT RECONSIDERED | S1: Introduction to marketing management in a constrained world 27 FRENCH CONSUMERS’ PERCEPTION OF MARKETING Marketing is primarily associated with advertising and sales Marketing is associated with negative words such as “scam”, “lies”, “harassment”, “overconsumption” Source: AFM-Kantar study on marketing perception in France (2022) MARKETING MANAGEMENT RECONSIDERED | S1: Introduction to marketing management in a constrained world 28  FRENCH CONSUMERS’ PERCEPTION OF MARKETING Marketing's informative role Keeps me up to date on brand news; Offers entertaining and fun content and activities; Showcases the work of artists, for example in advertising or store window displays; Gives me access to a wide range of products and services; Helps you get to know me better and make me offers tailored to my needs; Allows me to discover product and service offers I wouldn't have considered; Helps me find the products/services best suited to my needs; Gives me the opportunity to make good deals. Realistic critics (33%) Marketing advocates (25%) Marketing’s opportunistic role Marketing’s transformative role Primarily serves the interests of companies; Allows companies to sell products at Makes product prices accessible to as many people as possible; Contributes prices that exceed their real value; Gives the illusion of pleasure and well-being positively to changing attitudes towards inclusion and diversity; Generates without actually generating it; Used to sell off production stocks; enables the Idealistic experiences that take me out of my daily life; Guarantees product quality; Propose appropriation of cultural works for commercial purposes. critics solutions to limit the effects of climate change. (25%) Antimarketing (17%) Marketing’s alienating role Doesn't respect my privacy, I feel stalked; Encourages unnecessary purchases and waste; It's not sincere and authentic; Is invasive; Contributes to environmental deterioration; Presents messages that aren't credible; Perverts the spirit of sport. Source: AFM-Kantar study on marketing perception in France (2022) MARKETING MANAGEMENT RECONSIDERED | S1: Introduction to marketing management in a constrained world 29 THE CONTEXT: A CONSTRAINED WORLD MARKETING MANAGEMENT RECONSIDERED | S1: Introduction to marketing management in a constrained world 30  FACTS Environmental context Climate change Biodiversity collapse Scarcity of energy supply Mineral resources depletion Social context World population growth Increase in global poverty (food insecurity / working conditions) The issue of climate refugees Growing global and national inequalities Turkey - earthquake survivors hit by deadly floods, March 2023 (Ilyas Akengin / AFP) MARKETING MANAGEMENT RECONSIDERED | S1: Introduction to marketing management in a constrained world 31  REGULATIONS & NORMS At the international level UN Sustainable Development goals (SDGs) AFNOR certifications (ISO 26000 & 14001) Paris agreement (2016) & European Green deal (2019) CSRD (2024) … At the national level (e.g., France) https://www.ecologie.gouv.fr/politiques-publiques Energy transition legislation for green growth (2015) Egalim law for balanced trade relations in the agricultural sector and healthy, sustainable food (2018) Mobility policy law (2019) The anti-waste law for a circular economy (2020) https://sdgs.un.org/goals … MARKETING MANAGEMENT RECONSIDERED | S1: Introduction to marketing management in a constrained world 32 SOME CURRENT DISCUSSIONS  Preventing or adapting to climate change?  Technological solutions or low tech approach?  Sustainable development or degrowth ? MARKETING MANAGEMENT RECONSIDERED | S1: Introduction to marketing management in a constrained world 33 HOW TO RECONSIDER MARKETING IN THIS CONTEXT? MARKETING MANAGEMENT RECONSIDERED | S1: Introduction to marketing management in a constrained world 34  MARKETING AS A SPECIFIC VISION OF EXCHANGES  Exchanges must be fair and involve the creation of value for all stakeholders (individuals, organizations, institutions)  A set of tools to be used responsibly Source: AFM definition (2015) Powered by Midjourney MARKETING MANAGEMENT RECONSIDERED | S1: Introduction to marketing management in a constrained world 35  MARKETING MANAGEMENT DEFINITION Marketing management covers the coordinated marketing practices implemented by organizations to achieve their objectives. ⇒They include: Studying different audiences, their needs, uses, desires and aspirations, Creating products, services and experiences, Disseminating these offers in a commercial or non-commercial context. ⇒This involves: Establishing fair relationships with their various partners, in compliance with regulations, Taking into account the future consequences of these practices on all stakeholders and society at large. Source: AFM definition (2015) MARKETING MANAGEMENT RECONSIDERED | S1: Introduction to marketing management in a constrained world 36 S 1.1. COURSE PRESENTATION S 1.2. DEFINING MARKETING TODAY S 1.3. PRACTICING MARKETING MANAGEMENT IN A CONSTRAINED WORLD S 1.4. DESIGNING SUSTAINABLE INNOVATION & BUSINESS MODELS MARKETING MANAGEMENT RECONSIDERED | S1: Introduction to marketing management in a constrained world 37 VALUE CREATION AT THE HEART OF MARKETING MARKETING MANAGEMENT RECONSIDERED | S1: Introduction to marketing management in a constrained world 38  WHICH VALUE(S) ARE WE TALKING ABOUT? Objective value of the offer, designed by the organization ≠ Perceived value of the offer by the consumers ≈ 0,003€/L ≈ 0,13€/L ≈ 0,37€/L ≈ 4,5€/L Source: Adapted from De Baynast, A., Lendrevie, J., & Lévy, J. (2021). Mercator 13th ed. MARKETING MANAGEMENT RECONSIDERED | S1: Introduction to marketing management in a constrained world 39  WHICH VALUE(S) ARE WE TALKING ABOUT? Objective value of the offer, designed by the organization ≠ Prior to acquisition or subscription Perceived value of the offer by the consumers After acquisition or subscription Perceived benefits Re-purchase intention Core product Performances Quality Associated services Satisfaction Brand, etc. Perceived Experience value Dissatisfaction Perceived costs Price Efforts Perceived Time value of Change cost competitor Perceived risks, etc. offers Probability of defection Source: Adapted from De Baynast, A., Lendrevie, J., & Lévy, J. (2021). Mercator 13th ed. MARKETING MANAGEMENT RECONSIDERED | S1: Introduction to marketing management in a constrained world 40  WHICH VALUE(S) ARE WE TALKING ABOUT? Extended value Value for the organization + Value for the consumer +  integration of social & Added value environmental positive & negative externalities Extended value definition Offer life before its consumption Offer life during its consumption externalities externalities Offer life after its consumption e.g., raw materials extraction, production mode, e.g., repairing, increased usage e.g., waste management, recycling process Social storage, supply chain Full lifecycle of the offer Envionmental Source: Adapted from Bascoul & Moutot (2009) and Dekhili, Merle & Ochs (2021) MARKETING MANAGEMENT RECONSIDERED | S1: Introduction to marketing management in a constrained world 41 IMPLEMENTING A MARKETING STRATEGY INTEGRATING EXTENDED VALUE PRINCIPLES MARKETING MANAGEMENT RECONSIDERED | S1: Introduction to marketing management in a constrained world 42  LEVELS OF STRATEGIC INTEGRATION Integrative strategy 3 Social and environmental issues are at the heart of the organization's strategy and reason-to-be. All corporate functions are mobilized. The brand, the range of offers and their variations on all the variables in the mix are involved, right up to the impact on the business model. Proactive strategy 2 Scattered integration of issues into strategy and mix, including the transformation of certain offerings. The business model, however, remains unchanged. Defensive strategy 1 Issues are only marginally integrated. Actions have no impact on the offering or business model. They are mainly relayed through communications, to enhance brand image and reputation (e.g., patronage, sponsorship, foundations). Risk of being accused of greenwashing and socialwashing. Defensive position 0 Minimum position. The organization limits itself to respecting the legal framework. Social and environmental issues are perceived as a threat, both restrictive and costly. Source: Dekhili, Merle & Ochs (2021) Powered by Midjourney MARKETING MANAGEMENT RECONSIDERED | S1: Introduction to marketing management in a constrained world 43  IMPLEMENTING AN INTEGRATIVE STRATEGY Defining the frame of reference: market versus product approach 0 Railway company becomes transport company; Petroleum company becomes company specialized in energy; Cosmetics company becomes company specialized in beauty. Diagnosing the situation 1 Understanding the market: consumers, competitors, social and environmental stakes. Understanding the company: strengths and weaknesses. Determining the strategy 2 Setting the objectives: at the economic, environmental and social levels. Integrating the objectives at the brand level: reason-to-be and mission, brand identity. Targeting & positioning: at the brand and offers’ levels. Deploying the appropriate marketing mix 3 Product mix – designing a sustainable offer: Moving towards a portfolio of more sustainable offers and supporting consumers in their use of these offers. Price mix - building a fair pricing policy: Integrating issues of responsibility and fairness into pricing policy, taking hidden costs into account. Place mix – distributing sustainably: Reducing the impact on logistics flows, building sustainable relationships with suppliers, enhancing the value of sustainable products through the product range and the customer experience. Promotion mix – developing responsible and effective communication: Creating responsible communication content, helping to build a new consumer culture, communicating effectively on sustainability, reducing the direct impact of actions and media. Source: Adapted from Dekhili, Merle & Ochs (2021) and Kotler, Keller, Manceau & Hemonnet (2019) MARKETING MANAGEMENT RECONSIDERED | S1: Introduction to marketing management in a constrained world 44  RESPONSIBILITY FOR THE MARKETING FUNCTION, BUT NOT ONLY... Corporate strategy & CSR Sustainable brand strategy Production & eco-design and socio-design Key performance indicators Financial Marketing R&D accounting Sustainable Responsible supply chains purchasing Logistics Purchases MARKETING MANAGEMENT RECONSIDERED | S1: Introduction to marketing management in a constrained world 45 S 1.1. COURSE PRESENTATION S 1.2. DEFINING MARKETING TODAY S 1.3. PRACTICING MARKETING MANAGEMENT IN A CONSTRAINED WORLD S 1.4. DESIGNING SUSTAINABLE INNOVATION & BUSINESS MODELS MARKETING MANAGEMENT RECONSIDERED | S1: Introduction to marketing management in a constrained world 46 HOW TO INNOVATE SUSTAINABLY? MARKETING MANAGEMENT RECONSIDERED | S1: Introduction to marketing management in a constrained world 47  INNOVATION AS A PROCESS & A RESULT As a process As a result Methods and tools for integrating environmental and Result of innovation process social issues into offer design Environmental impacts Social impacts Ecodesign + Sociodesign Extended value + Consumer value = = Sustainable innovation process Sustainable offer Source: Dekhili, Merle & Ochs (2021) MARKETING MANAGEMENT RECONSIDERED | S1: Introduction to marketing management in a constrained world 48  SUSTAINABLE INNOVATION TYPOLOGY Changed B. Redesign D. Behavioral innovation ecosolution Consumer uses and habits Unchanged A. Optimization C. Procedural innovation ecosolution Reducing environmental Solving an environmental and social impacts or social issue Extended value integration Source: Dekhili, Merle & Ochs (2021) MARKETING MANAGEMENT RECONSIDERED | S1: Introduction to marketing management in a constrained world 49  SUSTAINABLE INNOVATION TYPOLOGY Often involves working on resources: reducing the weight of products, packaging, energy or water consumption, without necessarily being promoted to consumers. Changed B. Redesign D. Behavioral innovation ecosolution Cristaline has reduced the weight of its bottles by 51% in 25 years Consumer uses and habits Sometimes meets new consumer Unchanged A. Optimization C. Procedural expectations without changing the innovation ecosolution product's use. Carapelli certified its 1st organic oil in Reducing environmental Solving an environmental and social impacts or social issue 2010 Extended value integration Source: Dekhili, Merle & Ochs (2021) MARKETING MANAGEMENT RECONSIDERED | S1: Introduction to marketing management in a constrained world 50  SUSTAINABLE INNOVATION TYPOLOGY Reducing the impact of an offer can lead to new uses. It's important to focus on the user experience on two levels: at the design stage, in the trade-off between extended value and consumer value Changed B. Redesign D. Behavioral at the time of consumption: supporting innovation ecosolution new uses Consumer uses and habits Unchanged A. Optimization C. Procedural innovation ecosolution Reducing environmental Solving an environmental and social impacts or social issue The nitrite-free ham launched by Fleury Michon in 2019 has a dual impact on usage: Extended value integration shorter shelf life and lighter color. Source: Dekhili, Merle & Ochs (2021) MARKETING MANAGEMENT RECONSIDERED | S1: Introduction to marketing management in a constrained world 51  SUSTAINABLE INNOVATION TYPOLOGY A new solution to an environmental or social problem that does not involve a major change in consumer habits. Changed B. Redesign D. Behavioral innovation ecosolution Consumer uses and habits Unchanged A. Optimization C. Procedural innovation ecosolution Fair trade seeks to ensure the economic and social progress of workers. However, a fair trade coffee like Malongo's is consumed like any other coffee. Reducing environmental Solving an environmental and social impacts or social issue Extended value integration Source: Dekhili, Merle & Ochs (2021) MARKETING MANAGEMENT RECONSIDERED | S1: Introduction to marketing management in a constrained world 52  SUSTAINABLE INNOVATION TYPOLOGY A new solution to an environmental or social problem that involves a major change in consumer habits. Changed B. Redesign D. Behavioral innovation ecosolution Consumer uses and habits Unchanged A. Optimization C. Procedural innovation ecosolution Reducing environmental Solving an environmental and social impacts or social issue Extended value integration Source: Dekhili, Merle & Ochs (2021) MARKETING MANAGEMENT RECONSIDERED | S1: Introduction to marketing management in a constrained world 53 HOW TO DESIGN NEW SUSTAINABLE BUSINESS MODELS? MARKETING MANAGEMENT RECONSIDERED | S1: Introduction to marketing management in a constrained world 54  SERVICIZATION Definition of servicization The key idea behind product service systems is that consumers do not specifically demand products, per se, but rather are seeking the utility these products and services provide. By using a service to meet some needs rather than a physical object, more needs can be met with lower material and energy requirements. A Product-Service System can be defined as the result of an innovation strategy, shifting the business focus from designing and selling physical products only, to selling a system of products and services which are jointly capable of fulfilling specific client demands. A Product-Service System is a competitive system of products, services, supporting networks and infrastructure. The system includes product maintenance, parts recycling and possible product replacement, which satisfy customer needs competitively and with lower environmental impact over the life cycle. 55  SERVICIZATION Advantages of servicization Meeting consumers’ needs with a mix of products and services is not a new concept. House rentals, hotels, taxis and restaurants are good examples based on economic interest. There are other new and innovative applications of product service systems that have developed as a response to make business more sustainable. The main difference between product service systems and the classic examples is that the preference of consumers is influenced by social & environmental interests, as well as economic interests. 56  SERVICIZATION Advantages of servicization 57  SERVICIZATION Three ways of developing innovation by servicization 1. Product-oriented services 2. Usage-oriented services 3. Result-oriented services (functional economy) 58  SERVICIZATION 1. Product-oriented services Provided to increase or optimise the product life cycle, these supplementary services are offered to guarantee functionality and durability of the product (e.g. maintenance and repair, upgrading and substitution services over a specified time period, advise and consultancy for use optimisation, etc.). 59 SERVICIZATION 60  SERVICIZATION 2. Usage-oriented services The product is made available in a different form to the customer, is sometimes shared by a number of users, but stays in ownership with the provider. It is the usage of the product rather than the product itself that is invoiced, without transfer of ownership (e.g. car sharing or car pooling, tools rental, financial leasing, etc.). 61  SERVICIZATION 3. Result-oriented services (functional services) In this most accomplished form of servicization, the seller does not sell a product anymore to the customer, but the desired result rendered by the product. Rather than selling pesticides to farmers for example, the seller decides to offer a global service contract that guarantees a minimal acceptable loss on crops. 62  SERVICIZATION 3. Result-oriented services (functional services) From a Business Model based on To a Business Model based on the quantity of products sold a service rate = Sell a minimum loss rate on crops 1435dfa83c Firms in a functional service are looking for less costly alternatives, such as the reintroduction of parasitic predatories or earth reoxygenation by earthworms or using R&D in biology, agronomy, entomology… The competitiveness of the seller depends on his/her ability to optimise the Product-Service System implemented to reach this goal and to use the least possible resources and energy to reach the targeted acceptable loss. 63 FROM THE EVOLUTION OF PRODUCTS AND USES TO THE EVOLUTION OF THE BUSINESS MODEL Evolution of products and uses Development of new business models Second-hand Reducing, eliminating, substituting resources Buy-sell and donate model; matchmaking model, hybrid model. Extending product life, by combating absolute and relative obsolescence Functionality-based economy (e.g., leasing or functional sell, sharing economy) Supporting sustainable use, by raising awareness of good practices (e.g., encouraging the right dose of use or repair) Social Innovation Optimizing product end-of-life Bottom of the Pyramid approach (e.g., recycling, upcycling) + read Saebi et al. (2019) for typology MARKETING MANAGEMENT RECONSIDERED | S1: Introduction to marketing management in a constrained world 64  NEW TYPES OF BUSINESS MODEL CANVAS e.g., Joyce & Paquin (2016): Triple layered canva For more, also read Cardeal et. (2020) MARKETING MANAGEMENT RECONSIDERED | S1: Introduction to marketing management in a constrained world 65  CASE STUDY DECATHLON An emblematic player in the mass retail sector undergoing a transformation Ecodesign: production process, choices of materials and product design Second-hand: Trocathlon & Decathlon occasion, Decathlon Second-life program Functionality-based model: Decathlon We play circular (subscription model) Sources: Akli Achabou et al. (2023) in Dekhili and Reniou (2023), www.decathlon.fr MARKETING MANAGEMENT RECONSIDERED | S1: Introduction to marketing management in a constrained world 66 SWOT ANALYSIS GUIDELINES MARKETING MANAGEMENT RECONSIDERED | S1: Introduction to marketing management in a constrained world 70  SWOT ANALYSIS INTEGRATING IMPACT ANALYSIS Classical « Opportunities & Threats » analysis + Market impact analysis Macro-environment level (external forces impacting your market) Environmental impacts ✓ Demographic environment ✓ Air quality (e.g., contribution to the greenhouse effect) ✓ Socio-cultural environment ✓ Water quality (e.g., aquatic ecotoxicity, water ✓ Economic environment consumption) ✓ Human health (e.g., human toxicity) ✓ Political/legal environment ✓ Resource depletion (e.g., non-renewable resources, ✓ Technological environment energy consumption) ✓ Loss of biodiversity Micro-environment level (things happening within your market) Social impacts ✓ Market and sub-markets ✓ Human rights ✓ Competitors ✓ Working conditions ✓ Distributors ✓ Health & safety ✓ Cultural heritage ✓ Consumers ✓ Governance MARKETING MANAGEMENT RECONSIDERED | S1: Introduction to marketing management in a constrained world 71  SWOT ANALYSIS INTEGRATING IMPACT ANALYSIS Opportunities Threats Macro-environment Macro-environment Demographic environment Demographic environment Economic environment Economic environment …. …. Micro-environment Micro-environment Market Market Competitors Competitors …. …. Environmental impacts Environmental impacts Air quality Air quality Water quality Water quality …. …. Social impacts Social impacts Human rights Human rights Working conditions Working conditions …. …. Implications  In conclusion, what does this mean for the brand studied? MARKETING MANAGEMENT RECONSIDERED | S1: Introduction to marketing management in a constrained world 72  TO HELP YOU… https://library.kedge.edu/bases-de-donnees.aspx https://sdgs.un.org/goals Kantar Sustainability Sector Index 2022 & 2023  Xerfi, Statista, GlobalData  RSEdatanews https://base-empreinte.ademe.fr/documentation/base-impact MARKETING MANAGEMENT RECONSIDERED | S1: Introduction to marketing management in a constrained world 73