Old versus New Rules of Marketing

Old versus New Rules of Marketing

Abstract

The separator of old and new rules of marketing is the web. Prior to the arrival of the web, marketing organizations had only two significant options for attracting attention of clients: Buy expensive advertising or get endorsement, mainly through advertorials, from the media. But the web has changed the rules. Organizations that understand the new rules of marketing develop relationships directly with consumers. In this scenario advertising today is a money pit of wasted resources. The web has opened a tremendous opportunity to reach niche buyers directly with targeted information that costs a fraction of what big-budget advertising costs. With old rules of marketing it simply meant advertising and branding; advertising needed to appeal to the masses; advertising relied on interrupting (for instance a TV show) to gain people’s attention to a product; it was one way – company to consumer; creativity was deemed the most important component of advertising; it was more important for the ad agency to win advertising awards than for the client to win new customers. None of this is true anymore; the web has transformed the rules; this paper would like to argue that a company must transform its marketing to make the most of the web-enabled marketplace of ideas.

Key words: Marketing, Internet, Web, Marketing Mix

1.Introduction

Parallel to old and new rules¹ of marketing are old media and new media; in the old media there were a set of marketing rules, which are replaced by a new set of rules being followed by the new media, which were ushered in by the internet. The impact of the Internet as a commercial carrier was felt within a short time. “The Internet is a tidal wave. It will wash over nearly all industries drowning those who don’t learn to swim in its waves.”² These words were expressions of ‘wild enthusiasm’ and optimism regarding the internet revolution causing great changes in the marketing sector. Soon this was replaced by a phase of learning and maturity as marketers began to ponder the potential benefits of the new technology. Sure, there was absolutely no hesitation to believe that internet based marketing will continue to grow. Internet technology has become available on many platforms – PC, Laptop, Tablet, Mobile phones. And so when one looks back this expectation of internet facilitating a major portion of marketing has fallen in place. This phenomenon has made it important for us to talk about the traditional models and new models of marketing.

2. Marketing

According to the Business Dictionary, Marketing is “the management process through which goods and services move from concept to the customer. It includes the coordination of four elements called the 4 Ps of marketing: (1) identification, selection and development of a product, (2) determination of its price, (3) selection of a distribution channel to reach the customer's place, and (4) development and implementation of a promotional strategy”³. Now this definition was sufficient according to the old rules of marketing but in the cyber-age we need to add a digital dimension to it which would entail management and execution of marketing using electronic media such as the web, e-mail, interactive TV and wireless media in conjunction with digital data about customers’ profile and behaviour (Chaffey, 2008: 519). This can also be known as ‘electronic marketing’ and which will include the concept of ‘direct marketing’. Also according to the old rules of marketing the four Ps of marketing mix was considered the norm but according to the new rules of marketing another three Ps have to be added: People, Process, and Physical evidence.

3. Objectives of the Research

The main objective is to explain the drastic changes that have taken place in marketing with the advent of digital age.

Another objective is to describe and compare the old and new ways of marketing.

The paper would like to study as to what benefits would accrue to marketing by following the new rules of marketing.

4. Research methodology

It is a descriptive-explanatory study. Descriptive research is a research that explores and explains an individual, group or a situation. It describes characteristics and functions. In the present paper the situation is that of marketing; the marketing situation has undergone changes – from traditional mode to the new. The paper will describe the old and new rules of marketing and offer explanation as to the advantage of the new compared to the old. The paper will also look into the characteristics of traditional as well as the internet-based marketing

5. Marketing Communication

Whether it is old or new rules of marketing they are all based on communication. It is various means of communication which conveyed the rules. Within the limited scope of this paper we can only deal with some of the main means of communication that were used in marketing. Marketing communication used to be limited to three kinds of messages which were relevant to efforts at directing, soliciting or persuading consumers or users of the product offered for sale: i) Logistic information ii) Persuasive or promotional information iii) Problems solving information.⁴

Marketing communicators also took note of the five questions that Laswell outlined in his book The Structure and Function of Communication in Society:

i) Who is the communicator? (Control Analysis)

Logistic messages are exchanged between buyers and sellers. The seller or his agent conveys messages to rail and road transport centres for ensuring prompt delivery of goods in the marketing sector. The seller may have to employ yet another communication to materilalise sale of his product. “The main task in control analysis is to convey the message of the sender or seller with clarity so that it is correctly understood and properly grasped ….”⁵

ii) What is the content of the message? (Content Analysis)

While communication is made between sellers and buyers, here the pertinent question is what is the purpose or ulterior motives of the message. It is to create that want satisfying power. “The seller in order to produce this effect presents the product that gratifies both desire and need of the prospective customer ….”⁶ All business communication and its content are not necessarily subtle. To explain this further Kumar (2008) falls back on McGarry’s views on ‘The Contractual function in marketing’. According to this the content of communicationshould be very clear, possibly talk the same language. Precision in communication is the major factor in agreement. Marketing research has been one of the important factor in content analysis.

iii) Who is the audience for which the message is intended? (Audience Analysis)

The third factor in Lasswell’s Communication theory was the receiver of the message or an audience. In marketing audience consists of buyers and sellers. Audience can also be characterized as market. Such audience may be segmented and may comprise of different categories who receive (react) to messages differently. For instance advertisements targeted at various sections of the market – children, youth, adult, men, women – may be received with great effect. For instance, young people and adults interested in fitness might subscribe to magazines on fitness.

iv) What information media or means of transmitting the message are employed? (Media Analysis)

There are specific communication channels for specific messages. Magazines, newspapers, radio and television offered platforms for specific messages. Advertisement and market news used to be transmitted by a host of communication channels such as the radio, television, satellite and other networks, besides advanced electronic devices. But messages conveyed through advertisement in newspapers was entirely different from advertisement through radio. Companies bought (through its ad agencies) media space for anticipated results.

v) What behavior follows receipt of the message? (Effect Analysis)

And finally Laswell spoke of the feedback of the receiver to the sender - effect analysis. “Feedback may be described as the difference or discrepancy between the desired and achieved result of performance.”⁷ It has to do with the relationship between the content of the message and the subsequent conduct of the audience. Mass media is said to have immense power over the minds of the audience, though there is much debate as to the degree or level of this effect. Joseph Klapper (1960) says that “Mass communication ordinarily does not serve as a necessary and sufficient cause of audience effects, but rather functions through a nexus of mediating factors and influences. These mediating factors …typically render mass communication a contributory agent, but not the sole cause in a process of reinforcing the existing conditions.”⁸ As far as marketing is concerned the feedback on competitive conditions or of the popularity of a product or otherwise helps the marketer to plan and execute adjustments needed for taking corrective action.

Table 1: Old Scenario of Marketing Communication

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¹ ‘Rules’ here do not stand for legally laid down dos and don’ts; it simply means the way something is done in this context of course marketing.

² Richard Gay, Alan Charlesworth, and Rita Esen. (2007) Online Marketing: A Customer-led Approach. New Delhi: Oxford University Press, 02.

³ See<http://www.businessdictionary.com/definition/marketing.html> 18 February 2018.

⁴ Niraj Kumar. (2008) Marketing Communications: Theory & Practice. New Delhi: Himalaya Publishing House, 6-7.

⁵ Ibid., 8-9.

⁶ Ibid., 10.

⁷ Ibid., 15.

⁸ Joseph T. Klapper. (1960) The Effects of Mass Communication. New York: The Free Press of Glencoe, 08.