Marketing Objectives, Strategy, and Ethics
- Marketing Objectives
- Marketing strategy
- Marketing ethics
Marketing objectives tell us what the company should achieve through its marketing activities. They outline measurable goals for marketing programs.
Objectives must be consistent with the objective above, namely corporate objectives. Companies dissect corporate objectives into functional or departmental objectives for each business function, including marketing. Thus, marketing objectives are a prerequisite for meeting corporate objectives.
Marketing objectives may vary between companies. However, they have something in common, namely, related to product, sales, and marketing only. For example, it may relate to sales volume, market share, customer acquisition, or product development.
Why are marketing objectives important? Several reasons explain this, including:
- Monitor progress in achieving the corporate objective
- Provide clear direction for the marketing department
- Help in decision making
- Become the basis for allocating effort and resources
- Used to evaluate the marketing department
Good marketing objective criteria and examples
Good marketing objectives must meet SMART criteria:
Specific. An objective is clearly defined or identified. For example, it is related to sales volume and market share.
Measurable. Ideally, objectives are quantifiable, facilitating tracking progress. For example, sales increased by 5%, or market share increased to 10% from 6%.
Achievable. Objectives are realistic to fulfill. For example, a 5% increase in sales and 4% in market share is practical, considering the internal and external environment.
Relevant. Objectives are appropriate to contexts, such as being consistent with corporate objectives, resources, and capabilities. And they are relevant to the business environment in which the marketing program is executed. For example, an increase in sales and market share is aligned with the company’s growth objective.
Time-bound. Objectives must have a deadline to achieve. For example, the company sets a 5% increase in sales in the next year. And for market share, the target is for the next two years.
Marketing objectives for-profit organizations and non-profit organizations
For-profit organizations’ marketing objective is basically about making more money. Examples are:
- Increase market share
- Increase sales
- Develop new products
- Opening new distribution channels
- Increase brand awareness
Meanwhile, non-profit organizations have different objectives. They do need money. But it’s to finance operations and expand their program. Their objective might be:
- Add volunteers
- Increase exposure
- Adding new donors
- Receive media coverage
Marketing strategy is about how to realize marketing objectives. It concerns a method or way designed to fulfill an objective. Thus, objectives provide a starting point for marketing strategies and plans.
As with marketing objectives, marketing strategies must also be consistent with the corporate strategy or the corporate objectives. Say, a company adopts a differentiation strategy and sets increasing profit as its corporate objective. The marketing department then realizes this by, for example, increasing selling prices or reducing advertising spending as a strategy. Expanding distribution channels and selling products to foreign markets are other examples.
Increasing the selling price can be misaligned if the company adopts a cost leadership strategy. Under this strategy, the company tries to sell products at an average price. And to increase profits, companies will spur operations to be more efficient to reduce cost structures.
Thus, price increases will only cause customers to switch to competitors even though the company gets higher profit margins.
Developing marketing strategy
Developing a marketing strategy involves several steps. They include:
- Setting marketing objectives. What should the company achieve through its marketing activities?
- Conducting marketing audits and market research. It includes examining the company’s external and internal environment, such as the current market position, external opportunities and threats, past marketing strategies and their success or failure, internal resources, capabilities, strengths, and weaknesses.
- Analyzing audit and research results. The marketing team summarizes audit and research results into meaningful findings. The results form the basis for determining which marketing strategy makes the most sense and will get the best results.
- Developing marketing strategy. Marketing strategy must maximize external opportunities using internal strengths and minimize external threats to company weaknesses. The company may continue with the old strategy because it has proven successful. Or, companies develop new ones to adapt to changes in the external environment or improve on old strategies.
- Developing an evaluation process. Companies need to evaluate the strategy being implemented. Did these strategies achieve the stated objectives? Should the company take corrective steps? Evaluation is essential to ensure an effective marketing strategy to achieve objectives.
The developed marketing strategy should:
- Aligned with corporate objectives and strategy
- Competitive and effective in achieving marketing objectives
- Synergize with other functional strategies
- Strategically fit
Strategic fit is consistency between internal resources and capabilities with external opportunities and threats. In other words, the company must have the resources and capabilities with which external opportunities are maximized, and external threats are minimized.
Changes in marketing strategy
Marketing strategies are dynamic. They change to suit the context in which they will be applied.
For example, consumer tastes and preferences change. Therefore, the company must adapt its marketing strategy to be relevant to customer requirements. If successful adaptation, customers continue to buy and do not switch to competitors’ products.
Several points explain how marketing strategy evolves in response to changes in the marketing environment.
Product life cycle. Shorter life cycles require companies to adapt quickly at each stage. As a result, companies must use different strategies at various stages. If successful, they can generate strong sales during the introduction and growth stages.
Internet and mobile technology. E-commerce makes it easier for consumers to shop. It has increased the choices available to them. Thus, they can easily switch from one product to another if they do not match the price or quality.
Intense competition. Competitors may adopt aggressive marketing strategies to improve their market position. It can threaten the company and force it to take appropriate steps to prevent its negative impact on its position.
Globalization. Globalization has brought about many changes and affected how companies compete. For example, it increases choice and makes it easier for consumers to shop overseas. Tastes, culture, and lifestyles also lead to homogenization as information technology facilitates people to easily interact and learn about cultures or lifestyles in other countries. In addition, globalization has also increased competition by making it easier for foreign players to enter the domestic market.
Marketing ethics is about moral principles related to marketing. It guides business behavior in developing strategies and carrying out marketing activities.
Ethical marketing has become increasingly important today. Increasing attention to social and environmental issues has prompted stakeholders to demand it.
Marketing ethical issues are diverse, and the following are examples:
- Bait and switch
- Unsubstantiated claims
- Pyramid scheme
In addition, marketing also has a broad impact on individual consumers, society, or other businesses, which can be related to ethics, for example:
- Bad, dangerous, and unsafe product
- Creating a highly materialistic society
- Too few social goods
- Unfair competitive marketing practices
However, marketing ethics may differ from region to region to different people or from one situation to another. As a result, what may be acceptable marketing practice in one place may not be in another. Thus, applying ethical principles in marketing will be complex when companies target consumers with different backgrounds.
For example, some consider price discrimination to be unethical. However, it may be justified on economic grounds, such as a discount for high-volume buyers from low-volume buyers.