Marketing Management in the 21st Century / Edition 1

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Overview

Marketing activity is at the core of managing a business; it provides the focus for interfacing with customers and is the primary source of intelligence about customers, competitors, and the business environment in general. Marketing must be concerned with the long-run relationship of the firm with its customers as well as short-run sales activity. In this era of managerial concerns such as quality management, downsizing, reengineering, and outsourcing, marketing has become a major organizational thrust rather than just a task assigned to a single functional department. This book emphasizes the role of marketing in creating value for customers because customer value in turn leads to the creation of value for other firm stakeholders including stockholders and employees.

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Editorial Reviews

Booknews
An introductory graduate text on developing market strategy and managing the market process, emphasizing the role of marketing in creating value for customers. Provides a set of concepts for approaching marketing decisions and examines the structuring and analysis of managerial problems in marketing in the modern corporation. Features material not typically covered in marketing texts, such as an emphasis on shareholder value, the link between product markets and capital markets, and firms and governments as customers. Capon and Hulbert teach business and international marketing at Columbia University's Graduate School of Business. Annotation c. Book News, Inc., Portland, OR (booknews.com)
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Product Details

  • ISBN-13: 9780139156953
  • Publisher: Pearson
  • Publication date: 10/18/2000
  • Edition number: 1
  • Pages: 637
  • Product dimensions: 7.92 (w) x 9.92 (h) x 1.40 (d)

Read an Excerpt

PREFACE:

Preface

This book is about developing market strategy and managing the marketing process. One of the ways in which it differs from so many other introductory graduate-level marketing texts is that it focuses on what the prospective manager needs to know. It is unashamedly normative in emphasis, for marketing is an applied field, and we focus on the manager, not just the marketer. It is the responsibility of text writers to provide the guidance necessary for good practice. For those of you committed to a career in marketing, and we hope there are many, this book will form a solid foundation as you continue your marketing studies. However, the vast majority of you will not work in marketing departments; in many cases you have aspirations to be general managers and CEOs. We write for you also, because an appreciation and understanding of marketing is central to virtually every important decision that managers make.

Marketing activity is at the core of managing a business; it provides the focus for interfacing with customers and is the source of intelligence about customers, competitors, and the business environment in general. Marketing is concerned with the long-term relationships of the firm with its customers as well as short-term sales activity. In this era of such managerial concerns as quality management, downsizing, reengineering, and outsourcing, marketing has become a major organizational thrust rather than just a task assigned to a single functional department. This book emphasizes the role of marketing in creating value for customers. Successful creation of customer value in turn leads to the creation of value for other firmstakeholders, including shareholders and employees.

OUR CUSTOMERS: STUDENTS

For student readers, this book provides an introduction to the role of marketing in the modern corporation, both at the level of the firm and the marketing function. The book focuses on providing a set of concepts and ideas for approaching marketing decisions, on providing a common language with which to think about marketing issues, and on the structuring and analysis of managerial problems in marketing. It prepares future general managers and CEOs to deal with core marketing issues by providing a way of thinking strategically about the firms' products, services, and markets and represents what the general manager must know about marketing.

At the conclusion of this book, students should have developed frameworks for analyzing markets, customers, competitors, and complementers, and for approaching marketing problems. They should be able to develop market strategy and implementation programs comprising the 4Ps and an S (also termed the marketing mix) of product, price, place, promotion and service, in a variety of contexts—domestic/international, products/services, industrial/consumer, private/public sector, and not-for-profit.

As students work through this book they are expected to develop a high tolerance for ambiguity, a quality of all successful general managers. You will learn that there are no right or wrong answers to marketing problems, just some that are better than others. There are no simple (or even complex) formulae in which to plug a set of numbers and secure the "right" answer. Instead, students learn to approach complex and unstructured marketing problems in a creative and measured way.

OUR CUSTOMERS: MARKETING FACULTY

For marketing faculty, this book offers a contemporary perspective on marketing in the modern corporation. It also includes material that is not typically covered in marketing texts, such as an emphasis on the real "bottom line" of marketing activities, shareholder value. By understanding and acting upon the principles developed in this book, students will avoid the many pitfalls of competing in an increasingly global, complex, and competitive environment and be able to enhance shareholder value for their organizations, large and small, even though their work may involve marketing in many different countries around the world. These, after all, should be the goals for which marketing educators strive.

The book achieves its purpose by stating a set of behaviorally based learning objectives for each chapter, and then providing material to achieve those objectives. In addition, the device of contrasting "old way versus new way" is employed to provide a sense of the changing role of marketing in the modern corporation. Each chapter concludes with a set of provocative questions designed to make students think about marketing rather than view marketing as a cut and dried topic.

Learning how to think in the appropriate way to deal with marketing problems requires a considerable degree of effort from both faculty and students. In order to provide students with the opportunity to develop skills in marketing problem solving we recommend that this book be used in conjunction with a set of case studies chosen by each instructor. In addition, with this book, faculty are provided access to an Instructors Manual and a set of overhead transparencies.

WHAT MAKES THIS BOOK UNIQUE

In this section we present the Capon and Hulbert "top ten" list, highlighting those areas in which the book differs from other offerings.

  • One: As noted above, the book has a normative focus. As such, it takes a position on what should, and what should not, be appropriate courses of action. We believe that readers should know where we stand and what we believe is right.
  • Two: We emphasize the important link between product markets and capital markets. We make the product/market-capital/market relationship explicit and show how world-class marketing decision making must always consider capital market implications.
  • Three: The book attempts to reflect the structural realities of the modern economy. For example, we are conscious of the fact that in advanced economies, services account for upwards of 70% of GNP, and that advances in telecommunications and computers are changing the nature of the marketing function for many organizations. This reality is reflected in the text; we discuss the Internet throughout, as well as devoting Chapter 21 to the topic.
  • Four: We treat the marketing mix as we feel it should be treated, as the means to implement the product/market strategy. We believe that other critical questions must necessarily precede decisions about marketing mix elements. Among them: What is the essential role of marketing in the corporation? What is the appropriate role of marketing for increasing shareholder value? What is a market strategy, and how do you know if your market strategy is complete? Why are brands important and what are the key issues involved in developing a branding strategy? Only after such questions have been resolved should marketing implementation decisions be made.
  • Five: The book introduces what we believe are a number of genuinely new ideas drawn from our most recent research and writings, which directly address the dramatic and rapid changes that are taking place in marketing today.
  • Six: We tend to avoid descriptive data about the institutions that conduct marketing activities. It is not that we believe it is unimportant for students to understand the institutional framework within which marketing activity is conducted. Rather, because the environment is changing so quickly, students should understand that marketing institutions are themselves a variable, certainly changing in the medium and long run (and possibly in the short run also). In addition, marketing institutions vary from country to country around the world. In writing for students who will be competing in a global marketplace, we have chosen to focus on ways of thinking about marketing issues that are enduring and that transcend institutional differences.
  • Seven: Although consumer marketing is a critically important area, we balance our discussion of consumers as targets for marketing effort with considerable emphasis on organizations, for example, firms and governments, as customers. Indeed, some of the more interesting developments in marketing practice today are concerned with organizational marketing.
  • Eight: We have not included chapters on International Marketing, Marketing Research or Marketing Information Systems; rather, this material has been integrated throughout the text. Regarding international marketing, we believe strongly that the fundamental underpinnings of marketing are consistent regardless of country setting and, consequently, throughout the book, have made a concerted attempt to be global in outlook. Many leading firms are now developing product and branding strategies on a global basis and are scrapping their geographic-based organizational structures and processes in favor of truly global organizations. Furthermore, the Internet is breaking down national barriers.
  • Nine: Our intention is to give you only what you really need, when you need it, by taking care of some of the sorting tasks and saving you time and effort.
  • Ten: We firmly believe that graduate study in marketing should include significant student experience in facing marketing problems via case-method or simulation approaches. However, we also believe that instructors should feel free to search the many case libraries, rather than be constrained to a set of cases included with the text. Our goal has been to write a world-class marketing textbook.

The focus of our efforts is aimed squarely at the challenges facing managers in for-profit business organizations. However, we also believe this book will prove useful to those interested in not-for-profit and public sector marketing. We believe that the vast majority of the concepts we discuss are readily transferable to these other sectors; the major difference concerns organizational objectives. In the for-profit sector, objectives are unambiguously concerned with profit and shareholder value; in the not-for-profit and public sectors, organizational objective setting is often a complex undertaking.

AUTHORS

The authors are long-time tenured faculty at one of the world's leading Graduate Schools of Business, at Columbia University. Individually, they have won excellence in teaching awards from Columbia University and the Graduate School of Management, UCLA and, in addition to teaching in the United States, have taught or held visiting faculty positions in Australia (Monash University), Brazil (Fundacao Joao Pinheiro), England (Bradford Management Centre, Henley Management College, London Business School), France (INSEAD, University of Grenoble), Greece (The Athens Laboratory of Business Administration), Hong Kong (The Hong Kong University of Science and Technology), Iran (The Industrial Management Institute), the People's Republic of China (China European International Business School) and Wales (Cardiff Business School).

Both authors are frequently called on by major corporations around the world for consultation and educational assignments. For over 20 years, Mac Hulbert has been director of Columbia's Marketing Management Program. Noel Capon, a former associate director of this program, is currently director of Columbia's Competitive Marketing Strategy, Key Account Management, Sales Management, and Senior Sales Executive programs.

ACKNOWLEDGMENTS

We thank our colleagues at the Graduate School of Business, Columbia University, for providing the stimulating environment that helped us develop and test many of the ideas presented in this book. In particular, we thank Professors Michel Pham and Bernd Schmitt for providing insightful feedback on drafts of the book and acknowledge the roles played by the late Abe Shuchman, who emphasized the importance of educating practicing managers, and the late John A. Howard, who for many years provided leadership in marketing and created an environment within which a variety of ideas and philosophies could flourish. Second, we thank our many students who, over the years, have challenged us to refine and sharpen our ideas. In addition to MBA and Executive MBA students, we include participants in both open enrollment and in-company executive programs. As our own work with companies has shifted from education qua education to the very real challenges of organizational change, these students, including many CEOs, have involved us in attempting to resolve key marketing issues vital to effective corporate functioning. Third, we wish to acknowledge our many friends in industry whose ideas have, in their different ways, made valuable contributions to our thinking. These include William K. Brandt, Robert Christian and Bob Pratt. In addition, Jefferson Freeman, Gwen Ortmeyer, and Hastings Read read the entire manuscript and provided valuable feedback. Fourth, we wish to thank several of our Columbia colleagues who gave freely of their time to comment on individual chapters: Andrew Gershoff—Chapter 17, Sunil Gupta—Chapter 6, Kamel Jedidi—Chapter 13, Gita Johar—Chapters 4 and 14, Don Lehmann—Chapter 12, Francoise Simon—Chapter 11 and John Zhang—Chapter 18. In addition, Tony Carter—Chapter 15 and Liam Fahey—Chapter 5 were extremely helpful. Another helpful colleague was Enrique Arzac. Ellen Capon read the book from cover to cover and provided valuable customer-oriented feedback from the perspective of an entering MBA student. Fifth, we acknowledge our colleagues Pierre Berthon, Professor of Marketing at the University of Bath, Great Britain, and Leyland Pitt, Curtin University, Australia, who provided the basis for Chapter 21, on the Internet. Finally, we should like to thank those Prentice Hall staff who have supported and encouraged us along the way, including Kate Moore, Sales Representative; Whitney Blake, editor; Mary Ellen McCourt, production editor; Shannon Moore, marketing manager; and Anthony Palmiotto, assistant editor.

We would also like to thank the following reviewers: Sandy Becker, Rutgers University; Jim Murrow, Drury University; Bill Gray, Keller Graduate School of Management; Ron Lennen, Barry University; Andrew Yap, Florida International University; and Paul McDevitt, University of Illinois, Springfield.

Finally, we acknowledge a debt to our respective spouses who, as active professionals, know full well the commitment necessary to complete a major writing assignment such as this.

Noel Capon
Professor of Business
Chair of Marketing Division
Graduate School of Business
Columbia University

James M. Hulbert
Kopf Professor of International Marketing
Graduate School of Business
Columbia University

Read More Show Less

Table of Contents

I. MARKETING AND THE FIRM.

1. Introduction to Marketing Management.
2. The Environmental Imperative.
3. The Externally Oriented Firm.

II. FUNDAMENTALS FOR STRATEGIC MARKETING.

4. Customers.
5. Competitors and Complementers.

III. THE TASKS OF MARKETING.

Task 1: Determine and Recommend Which Markets to Address. 6. Identifying Opportunities for Creating Shareholder Value.

Task 2: Identify and Target Market Segments. 7. Market Segmentation and Targeting.

Task 3: Set Strategic Direction. 8. Market Strategy: The Integrator.
9. Competitive Market Strategies in Introduction and Growth.
10. Competitive Market Strategies in Maturity and Decline.
11. Managing Brands.

Task 4: Design the Marketing Offer. 12. Managing the Product Line.
13. Developing New Products.
14. Integrated Marketing Communications.
15. Directing and Managing the Field Sales Effort.
16. Distribution Decisions.
17. Managing Services and Customer Service.
18. Managing Price and Value.

Task 5: Secure Support from Other Functions. 19. Ensuring the Marketing Offer Is Implemented as Planned.

Task 6: Monitor and Control. 20. Monitor and Control Execution and Performance.

IV. FUTURE DIRECTIONS.

21. Marketing and the Internet.
Postscript.
Appendix.
Glossary.
Publications Cited in the Text.
Brand/Company Index.
Subject Index.

Read More Show Less

Preface

PREFACE:

Preface

This book is about developing market strategy and managing the marketing process. One of the ways in which it differs from so many other introductory graduate-level marketing texts is that it focuses on what the prospective manager needs to know. It is unashamedly normative in emphasis, for marketing is an applied field, and we focus on the manager, not just the marketer. It is the responsibility of text writers to provide the guidance necessary for good practice. For those of you committed to a career in marketing, and we hope there are many, this book will form a solid foundation as you continue your marketing studies. However, the vast majority of you will not work in marketing departments; in many cases you have aspirations to be general managers and CEOs. We write for you also, because an appreciation and understanding of marketing is central to virtually every important decision that managers make.

Marketing activity is at the core of managing a business; it provides the focus for interfacing with customers and is the source of intelligence about customers, competitors, and the business environment in general. Marketing is concerned with the long-term relationships of the firm with its customers as well as short-term sales activity. In this era of such managerial concerns as quality management, downsizing, reengineering, and outsourcing, marketing has become a major organizational thrust rather than just a task assigned to a single functional department. This book emphasizes the role of marketing in creating value for customers. Successful creation of customer value in turn leads to the creation of value for otherfirmstakeholders, including shareholders and employees.

OUR CUSTOMERS: STUDENTS

For student readers, this book provides an introduction to the role of marketing in the modern corporation, both at the level of the firm and the marketing function. The book focuses on providing a set of concepts and ideas for approaching marketing decisions, on providing a common language with which to think about marketing issues, and on the structuring and analysis of managerial problems in marketing. It prepares future general managers and CEOs to deal with core marketing issues by providing a way of thinking strategically about the firms' products, services, and markets and represents what the general manager must know about marketing.

At the conclusion of this book, students should have developed frameworks for analyzing markets, customers, competitors, and complementers, and for approaching marketing problems. They should be able to develop market strategy and implementation programs comprising the 4Ps and an S (also termed the marketing mix) of product, price, place, promotion and service, in a variety of contexts—domestic/international, products/services, industrial/consumer, private/public sector, and not-for-profit.

As students work through this book they are expected to develop a high tolerance for ambiguity, a quality of all successful general managers. You will learn that there are no right or wrong answers to marketing problems, just some that are better than others. There are no simple (or even complex) formulae in which to plug a set of numbers and secure the "right" answer. Instead, students learn to approach complex and unstructured marketing problems in a creative and measured way.

OUR CUSTOMERS: MARKETING FACULTY

For marketing faculty, this book offers a contemporary perspective on marketing in the modern corporation. It also includes material that is not typically covered in marketing texts, such as an emphasis on the real "bottom line" of marketing activities, shareholder value. By understanding and acting upon the principles developed in this book, students will avoid the many pitfalls of competing in an increasingly global, complex, and competitive environment and be able to enhance shareholder value for their organizations, large and small, even though their work may involve marketing in many different countries around the world. These, after all, should be the goals for which marketing educators strive.

The book achieves its purpose by stating a set of behaviorally based learning objectives for each chapter, and then providing material to achieve those objectives. In addition, the device of contrasting "old way versus new way" is employed to provide a sense of the changing role of marketing in the modern corporation. Each chapter concludes with a set of provocative questions designed to make students think about marketing rather than view marketing as a cut and dried topic.

Learning how to think in the appropriate way to deal with marketing problems requires a considerable degree of effort from both faculty and students. In order to provide students with the opportunity to develop skills in marketing problem solving we recommend that this book be used in conjunction with a set of case studies chosen by each instructor. In addition, with this book, faculty are provided access to an Instructors Manual and a set of overhead transparencies.

WHAT MAKES THIS BOOK UNIQUE

In this section we present the Capon and Hulbert "top ten" list, highlighting those areas in which the book differs from other offerings.

  • One: As noted above, the book has a normative focus. As such, it takes a position on what should, and what should not, be appropriate courses of action. We believe that readers should know where we stand and what we believe is right.
  • Two: We emphasize the important link between product markets and capital markets. We make the product/market-capital/market relationship explicit and show how world-class marketing decision making must always consider capital market implications.
  • Three: The book attempts to reflect the structural realities of the modern economy. For example, we are conscious of the fact that in advanced economies, services account for upwards of 70% of GNP, and that advances in telecommunications and computers are changing the nature of the marketing function for many organizations. This reality is reflected in the text; we discuss the Internet throughout, as well as devoting Chapter 21 to the topic.
  • Four: We treat the marketing mix as we feel it should be treated, as the means to implement the product/market strategy. We believe that other critical questions must necessarily precede decisions about marketing mix elements. Among them: What is the essential role of marketing in the corporation? What is the appropriate role of marketing for increasing shareholder value? What is a market strategy, and how do you know if your market strategy is complete? Why are brands important and what are the key issues involved in developing a branding strategy? Only after such questions have been resolved should marketing implementation decisions be made.
  • Five: The book introduces what we believe are a number of genuinely new ideas drawn from our most recent research and writings, which directly address the dramatic and rapid changes that are taking place in marketing today.
  • Six: We tend to avoid descriptive data about the institutions that conduct marketing activities. It is not that we believe it is unimportant for students to understand the institutional framework within which marketing activity is conducted. Rather, because the environment is changing so quickly, students should understand that marketing institutions are themselves a variable, certainly changing in the medium and long run (and possibly in the short run also). In addition, marketing institutions vary from country to country around the world. In writing for students who will be competing in a global marketplace, we have chosen to focus on ways of thinking about marketing issues that are enduring and that transcend institutional differences.
  • Seven: Although consumer marketing is a critically important area, we balance our discussion of consumers as targets for marketing effort with considerable emphasis on organizations, for example, firms and governments, as customers. Indeed, some of the more interesting developments in marketing practice today are concerned with organizational marketing.
  • Eight: We have not included chapters on International Marketing, Marketing Research or Marketing Information Systems; rather, this material has been integrated throughout the text. Regarding international marketing, we believe strongly that the fundamental underpinnings of marketing are consistent regardless of country setting and, consequently, throughout the book, have made a concerted attempt to be global in outlook. Many leading firms are now developing product and branding strategies on a global basis and are scrapping their geographic-based organizational structures and processes in favor of truly global organizations. Furthermore, the Internet is breaking down national barriers.
  • Nine: Our intention is to give you only what you really need, when you need it, by taking care of some of the sorting tasks and saving you time and effort.
  • Ten: We firmly believe that graduate study in marketing should include significant student experience in facing marketing problems via case-method or simulation approaches. However, we also believe that instructors should feel free to search the many case libraries, rather than be constrained to a set of cases included with the text. Our goal has been to write a world-class marketing textbook.

The focus of our efforts is aimed squarely at the challenges facing managers in for-profit business organizations. However, we also believe this book will prove useful to those interested in not-for-profit and public sector marketing. We believe that the vast majority of the concepts we discuss are readily transferable to these other sectors; the major difference concerns organizational objectives. In the for-profit sector, objectives are unambiguously concerned with profit and shareholder value; in the not-for-profit and public sectors, organizational objective setting is often a complex undertaking.

AUTHORS

The authors are long-time tenured faculty at one of the world's leading Graduate Schools of Business, at Columbia University. Individually, they have won excellence in teaching awards from Columbia University and the Graduate School of Management, UCLA and, in addition to teaching in the United States, have taught or held visiting faculty positions in Australia (Monash University), Brazil (Fundacao Joao Pinheiro), England (Bradford Management Centre, Henley Management College, London Business School), France (INSEAD, University of Grenoble), Greece (The Athens Laboratory of Business Administration), Hong Kong (The Hong Kong University of Science and Technology), Iran (The Industrial Management Institute), the People's Republic of China (China European International Business School) and Wales (Cardiff Business School).

Both authors are frequently called on by major corporations around the world for consultation and educational assignments. For over 20 years, Mac Hulbert has been director of Columbia's Marketing Management Program. Noel Capon, a former associate director of this program, is currently director of Columbia's Competitive Marketing Strategy, Key Account Management, Sales Management, and Senior Sales Executive programs.

ACKNOWLEDGMENTS

We thank our colleagues at the Graduate School of Business, Columbia University, for providing the stimulating environment that helped us develop and test many of the ideas presented in this book. In particular, we thank Professors Michel Pham and Bernd Schmitt for providing insightful feedback on drafts of the book and acknowledge the roles played by the late Abe Shuchman, who emphasized the importance of educating practicing managers, and the late John A. Howard, who for many years provided leadership in marketing and created an environment within which a variety of ideas and philosophies could flourish. Second, we thank our many students who, over the years, have challenged us to refine and sharpen our ideas. In addition to MBA and Executive MBA students, we include participants in both open enrollment and in-company executive programs. As our own work with companies has shifted from education qua education to the very real challenges of organizational change, these students, including many CEOs, have involved us in attempting to resolve key marketing issues vital to effective corporate functioning. Third, we wish to acknowledge our many friends in industry whose ideas have, in their different ways, made valuable contributions to our thinking. These include William K. Brandt, Robert Christian and Bob Pratt. In addition, Jefferson Freeman, Gwen Ortmeyer, and Hastings Read read the entire manuscript and provided valuable feedback. Fourth, we wish to thank several of our Columbia colleagues who gave freely of their time to comment on individual chapters: Andrew Gershoff—Chapter 17, Sunil Gupta—Chapter 6, Kamel Jedidi—Chapter 13, Gita Johar—Chapters 4 and 14, Don Lehmann—Chapter 12, Francoise Simon—Chapter 11 and John Zhang—Chapter 18. In addition, Tony Carter—Chapter 15 and Liam Fahey—Chapter 5 were extremely helpful. Another helpful colleague was Enrique Arzac. Ellen Capon read the book from cover to cover and provided valuable customer-oriented feedback from the perspective of an entering MBA student. Fifth, we acknowledge our colleagues Pierre Berthon, Professor of Marketing at the University of Bath, Great Britain, and Leyland Pitt, Curtin University, Australia, who provided the basis for Chapter 21, on the Internet. Finally, we should like to thank those Prentice Hall staff who have supported and encouraged us along the way, including Kate Moore, Sales Representative; Whitney Blake, editor; Mary Ellen McCourt, production editor; Shannon Moore, marketing manager; and Anthony Palmiotto, assistant editor.

We would also like to thank the following reviewers: Sandy Becker, Rutgers University; Jim Murrow, Drury University; Bill Gray, Keller Graduate School of Management; Ron Lennen, Barry University; Andrew Yap, Florida International University; and Paul McDevitt, University of Illinois, Springfield.

Finally, we acknowledge a debt to our respective spouses who, as active professionals, know full well the commitment necessary to complete a major writing assignment such as this.

Noel Capon
Professor of Business
Chair of Marketing Division
Graduate School of Business
Columbia University

James M. Hulbert
Kopf Professor of International Marketing
Graduate School of Business
Columbia University

Read More Show Less

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