Chapter 11 - MANAGING THE MARKETING FUNCTION

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.
THE ENGINEER AND THE FOUR P'S OF MARKETING
The engineering organization will be able to meet the
requirements of its clients (or customers) depending on how it
uses the four P's of marketing which are as follows:
1.
2.
3.
4.

the product (or service)

the price
the place, and
the promotion.

The Product
The term product" includes the tangible (or
intangible) item and its capacity to satisfy a specific need.
The services provided by the engineer manager will
be evaluated by the client on the basis of whether or not his or
her exact needs are met. When a competitor comes into the
picture and sells the same type of service, the pressure to
improve the quality of services sold will be felt. When
improvement is not possible, "extras" or "bonuses" are given to
clients.
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 a means to convince the customer to buy.
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.
When a company cannot be near the customers, it
uses other means to eliminate or minimize the effects of the
problem. Some of these means are:
1. hiring sales agents to cover specific areas;
2. selling to dealers in particular areas;
3. establishing branches where customers are
located;
4. establishing franchises in selected areas.
The Promotion
Before the buyer makes the purchasing decision,
however, he must first be informed, persuaded, and influenced.
The activity referred to, in this case, is called promotion.
McCarthy and Perreault define promotion as
communicating information between seller and potential buyer
to influence attitudes and behavior."
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

Advertising. 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, and newspapers.
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 called publicity.
The mass media is also the means used for publicity.
Personal Selling. 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
a sale."
Sales Promotion. Any paid attempt to communicate
with the customers other than advertising, publicity, and
personal selling, may be considered sales promotion. This
includes displays, contests, sweepstakes, coupons, trading
stamps, prizes, samples, demonstrations, referral gifts; etc.
STRATEGIC MARKETING FOR ENGINEERS
Under this set-up, the following steps are made:
1. selecting a target market
2. developing a marketing mix
Selecting a Target Market
In selecting a target market, the following steps are
necessary:
1. Divide the total market into groups of people who
have relatively similar product or service needs.
2. Determine the profit potentials of each segment.
3. Make a decision on which segment or segments
will be served by the company.
Factors Used in Selecting a Target Market. In selecting a target
market, the following factors must be taken into consideration:
1. the size of the market, and
2. the number of competitors serving the market.
Developing a Marketing Mix
After the target market has been identified, a
marketing mix must be created and maintained. The marketing
mix consists of four variables: the product, the price, the
promotion, and the place (or distribution).
Given a marketing environment, the engineer
manager can manipulate any or all variables to achieve the
company's goals. As such, 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 or all of the foregoing
may be undertaken as conditions warrant.