MANAGING THE MARKETING FUNCTION

CONTENTS:
What is the Marketing Concept? The Engineer and the Four Ps 0f Marketing

The Product The Price The Place The Promotion

Strategic Marketing for Engineers

Selecting a Target Market Developing a Marketing Mix

Engineering managers are engaged in the production of tangible or intangible goods. Some of these engineer managers are directly responsible for marketing the companys products or services. If he is promoted as general manager, both the production and marketing At whatever management the level the engineer manager works, he must be convincing others to patronize his outputs.

WHAT IS THE MARKETING CONCEPT?

Marketing is a group of activities designed to facilitate and expedite the selling of goods and services. The marketing concept states that the engineer must try to satisfy the needs of his clients by means of a set of coordinated activities When clients are satisfied with what the company offers, they continually provide business.

THE ENGINEER AND THE FOUR PS OF MARKETING

The engineering organization will be able to meet the requirements of its clients (or customers) depending on how it uses four Ps of marketing which are follows:
1.

2.
3. 4.

the product (or service) the price the place, and the promotion.

The Product
In the marketing sense, the term product includes the tangible (or intangible) item and its capacity to satisfy its specific need. The services provided by the engineer manager will be evaluated by the client on the basis whether or not his or her exact needs are met. When a competitor comes into the picture abd sells the same type of service, the pressure to improve the quality of services sold will felt.

When the improvement is not possible, extras or bonuses are given to clients. An example is the construction company that provides free estimates on whatever inquiries on construction are received.

The Price
Price refers to the money or other considerations exchanged for the purchase or use of the product, idea, or service. Some companies use price as a competitive tool or as means to convince the customer to buy. When products are similar in quality or other characteristics, price will be strong factor on whether or not a sale will be made .

The Engineering Manager and the Four Ps of Marketing

OBJECTIVES

VEHICLE

RESULT

The Marketing Objectives of the Engineer Manager

Product Price Place Promotion

Success or Failure

When a type of service becomes standardized, price can be strong competitive tool. When a construction firm, for instance, charges a flat 10 percent service fee for all of its construction services, a competitor may charge a lower rate. Such action, however, will be subject to whether or not the industry will allow such practice.

The Place
If every factor is equal, customers would prefer to buy from firms easily accessible to them. If time is of the essence, the nearest firm will be patronized. It is very important for companies to locate in places where they can be easily reached by their customers. Not every place is the right location for any company. When a company cannot be near by the customers, it uses other means to eliminate or minimize the effects of the problem.

Some of these problems are:

1. 2. 3. 4.

hiring sales agent to cover specific areas; selling to dealers in particular areas; establishing branches where customers are located; establishing franchises in selected areas.

Manufacturing companies can choose or adapt all of the above-mentioned options. Service companies like construction firms adapt the modified versions. An example is the engineer manager of a construction firm who gives commissions to whoever could negotiate a construction contract for the firm.

When engineer managers have products or services to sell, they will have to convince buyers to buy from them. Before the buyer makes the purchasing decision, however, he must first be informed, persuaded and influenced. The activity referred to, in this case as promotion. McCarthy and Perreault define promotion as communicating information between seller and potential buyer to influence attitude and behavior.

The Promotion

There are promotional tools available and the engineer manager must be familiar with them if he wants to use them effectively. These tools are as follows:
1. 2. 3. 4.

advertising publicity personal selling sales promotion

Nylen defines advertising as a paid message that appears in the mass media for the purpose of informing or persuading people about particular products, services, beliefs, or action. The mass media referred to include television, radio, magazines, ana newspapers. If the engineering manager wants to reach a large number of people, he may use any of the mass media depending on the specific needs and his budget.

Advertising

An Example of an Advertising Message

ALECTO GENERAL TECHNOLOGY AND DEVELOPMENT CORPORATION ENGINEERS DESIGNERS CONTRACTORS SUPPLIER Computer Facilities Design and Installation Local Area Networking-Cabling Data and Communication and Telecommunication Works

Electrical Wiring
Mechanical and Civil Works Fiber Optic Cabling Installation and Termination Supplier of UTP Fiber Optic and Coaxial Cable 1495 D. Oliman St., Makati City Tels. 890-2571, 890-2492 890-3604, 890-3607 Fax No. 890-2978

Publicity
The promotional tool that publishes news or information about a product, service or idea on behalf of a sponsor but is not paid for by the sponsor is so called publicity. The mass media is also the means used for publicity. If the engineer manager knows how to use it , publicity is very useful promotional tool. His message maybe presented as a news item, helpful information, or an announcement.

An Example of a Publicity Release

NOKIA PRESENTS THE FIRST PHONE DESIGNED FOR LOCAL NEEDS Manila, July 1, 1997 Nokia Mobile Phones, the largest European and worlds largest manufacturer of mobile phones and a world leader in digital technology, has introduced to the Philippines the Nokia 3810 Big Face, the first mobile phone designed specifically for the needs of the Asia-Pacific cellular market. The Nokia 3810 is a product of extensive regional research and feedback. Tagged as Nokia Big Face, the 3810 has a larger screen contained in a small and sleek European styled body, making it easier to read messages. With its unique graphic display, the Nokia 3810 displays large or small text, it is easier to find what you are looking for. Moreover, Nokia 3810 provides a comprehensive range of features like call management, memory functions, short message services, security code/control and has the most complete range of accessories. Nokia Mobile Phones is a part of the Nokia Group, a global telecommunications company headquarters in Helsinki, Finland. Nokia employs nearly 34,000 people in 45 countries and has net sales of US$8.5 billion in 1996. Nokia can be visited on the world wide web http:/www.nokia.com.

A more aggressive means of promoting the sales of a product or service is called personal selling. It refers to the oral presentation in a conversation with one or more prospective purchasers for the purpose of making the sale. Personal selling may be useful to the marketing efforts of the engineer manager. If, for instance, he is the general manager of a firm manufacturing spare parts, he may assign some employees to personally seek out spare parts dealers and big trucking companies to carry their product lines.

Personal Selling

Sales Promotion
Any paid attempt to communicate with the customers other than advertising, publicity, and personal selling, may be considered as promotion. This includes displays, contests, sweepstakes, coupons, trading stamps, prizes, samples, demonstration, referral gifts etc. Contest and sweepstakes are very popular sales promotion tools.

STRATEGIC MARKETING FOR ENGINEERS

Companies, including those managed by engineer managers, must serve markets that are best fitted to their capabilities. To achieve this end, a very important activity called strategic marketing is undertaken.

1. 2.

Under thus set-up, the following steps are made: Selecting a target market Developing a marketing mix.

Selecting a Target Market

A market consists of individuals or organizations, or both, with the desire and ability to buy a specific product or service. To maximize sales and profits, a company has the option of serving entirely or just a portion of its chosen market. Within markets are segments with common need and which will respond similarly to a marketing action.

The Construction Market and Its Segment

THE CONSTRUCTION MARKET

Residential Segment actual construction sub-segment construction materials sub-segment

Industrial Segment actual construction sub-segment construction materials sub-segment

Government Segment

actual construction sub-segment

actual construction sub-segment

1.

2. 3.

An analysis of the various segments of the chosen market will help the company make a decision on whether to serve all or some of the segments. The segment or segments chosen become the target market. In selecting a target market, the following steps are necessary: Divide the total markets into groups of people who have relatively similar product or service needs. Determine the profit potentials of each segment. Make a decision on which segment or segments will be served by the company.

Factors Used in Selecting Target Market

1. 2.

A target market must have the ability to satisfy the profit objectives of the company. In selecting a target market, the following factors must be taken into consideration: The size of the market, and The numbers of the competitors serving the market.

Developing a Marketing Mix

1. 2. 3.

4.

After a target market have been identified, a marketing mix must be created and maintained. The marketing mix consists of fou variables: product price promotion place

Given a marketing environment, the engineer manager can manipulate any or all variables to achieve the companys goals.

The

quality of the product may be enhanced, or the selling price made a little lower, or the promotion activity made a little more aggressive, or a wider distribution area may be covered. Any of all the foregoing may be undertaken as conditions warrant.

Total Demand and Net Demand as a Guide for Determining Target Market
Telephone Lines in Cabanatuan City Demand and Supply Situation 1997

Total Demand Supply Company A Company B Company C Total Supply NET UNSATISFIED DEMAND

150,000 lines
50,000 lines 30,000 lines 10,000 lines 90,000 lines 60,000 lines

The Company, The Marketing Mix and Target Market

Product Price Promotion Place

Other markets

THE TARGET MARKET

Other markets

Other markets