week 5 erletshaqe

Project Management5. Marketing and Project Management

week 5

Anthony F. Tardugno; Thomas R. DiPasquale; Robert E.

Matthews (2000) IT Services: Costs, Metrics,

Benchmarking, and Marketingby Prentice Hall, ISBN-

10: 0-13-019195-7Print ISBN-13: 978-0-13-019195-3,

Chapter 5

James Cadle and Donald Yeates (2004) Project

Management for Information Systems, Pearson

Education, ISBN 0 273 68580 5, Chapter 17

Why is marketing important?

What is Marketing?

Evolution of Marketing

Implementing Marketing

Market Classification

Developing Marketing Strategies

Marketing Research

Selling the Project

What is Marketing?

What is Marketing?

Marketing is a process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods and services to create exchanges

that satisfy individual and organizational objectives

What is Marketing?

Plan &

ExecuteExchange Satisfaction

Conception

Pricing

Promotion

Distribution

People &

Organisations

Goods and

Services

Selling Buying

Exchange

Distribution

Transport Storage

Selling

Buying

Selling

Buying

Transport

Storage

Facilitating functions

FinanceRisk

Taking

Standardize

Gather

Market

Info

Selling

Buying

Transport

Storage

Finance

Gather

Market

Info

Standardize

Risk

Taking

The marketing mix

Price Promotion Product Place

The marketing mix


People Process Physicals

The marketing mix


People Process Physicals

Personalization Peer to Peer Participation Predictive models

2. Evolution of Marketing

19C WW1 20s 30s WW2 50s 60s 70s 80s 90s Now

Advertisin

g

industry

develo

ps

Custo

mer

orie

nta

tion

What N

ext?

Industria

l

Revolu

tion

Dem

and

outp

aced su

pply

Pro

ductio

n

exceeds su

pply

Mark

etin

g M

ix

(4 P

s)

Fig

ure

11.2

Evolu

tion o

f th

e c

usto

mer

ori

enta

tion

(Pride,

Hughes &

Kapoor, 1

998, p321)

20s

30s

50s

60s

19C

Now

Permission marketing

Now

The Marketing Concept

is a

business philosophy

that involves the

entire organization

in the

process of satisfying

customers needs

while achieving organizational goals

The American Marketing

Association (AMA) states,

"Marketing is an

organizational function and

a set of processes for

creating, communicating

and delivering value to

customers and for managing

customer relationships in

ways that benefit the

organization and its

stakeholders.

www.marketingpower.com

3. Implementing Marketing

http://www.altadvertising.com/pdf%20files/salesvmarketing.pdf

Is Your Business "Sales" or "Marketing" Driven?

By Les Altenberg

Understand

potential

and existing

customers

Identify

their wants

and needs

Look at the

market are their needs

being met?

Can you

deliver the

goods?

Can you do

it well, fast

or cheap?

How do

customers

feel about

your brand

image?

Look at

specific

customer

stories

Mobilize

your

resources

Build and

sell your

product

Organizations need to reflect on

implementation of marketing

concept

Ask questions:

Can the product be

improved?

Is it being promoted

properly?

Is it being distributed

efficiently?

Is the price too high?

Make modifications on

basis of this feedback

4. Market Classification

A group of individuals, organizations, or both that have needs for products in a given

category and the ability, willingness, and authority to purchase such products

What is a Market?

There are different types of markets

Consumer ResellerIndustrial

Producer

Government

Institutional

Consumer

Purchasers and/or household members who

intent to consume or benefit from the

purchased products and who do not buy

products in order to make a profit


Producer

Government

Institutional

IndustrialPurchases products for use in day-to-day operations or in making other products for

profit.

Producers consist of individuals and business organizations that intend to make a profit by buying certain products to use in the manufacture of other products

Governments at all levels, purchase goods and services to maintain operations and to provide citizens with products such as roads, education, water, defense

And institutional organizations include churches, civic clubs, charitable groups. Not driven by profit, ROI


Producer

Government

Institutional

Resellers consist of intermediaries

such as wholesalers, and retailers

who buy finished products and sell

them for profit.


Producer

Government

Institutional

For the IT organization marketing entails

knowing primary internal markets

enterprise executives

operation and line managers

work-area managers

Production/end users

You need to predict their requirements,

develop feedback mechanisms for

performance, and services relevant to the

group

For example

Marketing to enterprise executives should focus on

governance issues

(e.g., decision making, funding, metrics, and architecture)

Marketing to managers should focus on the changes and

possibilities caused by IT's impact on business and the

business's impact on IT

5. Developing Marketing Strategies

A Marketing Strategy is a plan that will

enable an organization to make the best

use of its resources

Marketing Strategies consist of

selection and analysis of target market

&

creation and maintenance of an appropriate marketing mix.

A target market is a group of persons for whom a firm develops and maintains a marketing mix suitable for their specific needs and preferences

How to select a Target Market

Examine potential markets for effects on

sales, costs and profits

Determine if you have sufficient resources

to produce marketing mix

Ensure fit with the organizations overall objectives

Analyze strength and number of competitor

already selling

Take either total market approach or

market segmentation approach

Figure 11.3 General approaches for selecting target markets (Pride, Hughes & Kapoor, 1998, p324)

Creating a Marketing Mix Common to use a wide variety of

segmentation bases (see Table 11.2)

Organizations control important elements of marketing which must combine in a way to

reach the target market (marketing mix)

Organizations can vary elements of the marketing mix

product; design, brand name, packaging price; base price, discounts distribution; storage, transportation promotion; information

(Pride, Hughes & Kapoor, 1998, p325)

Figure 11.4 The marketing mix and the marketing environment (Pride, Hughes & Kapoor, 1998, p327)

6. Marketing Research

Marketing Research is the process of

systematically gathering, recording and

analyzing data concerning a particular

marketing problem

Conducting marketing research:

1. define the problem

2. make a preliminary investigation

3. plan the research

4. gather factual information

5. interpret the information

6. reach a conclusion

Figure 11.5 Marketing information system (Pride, Hughes & Kapoor, 1998, p331)

Marketing Trends Effect on IT Industry?

Growth in prime spending group

Decline in teenage population

Increase in the number of senior citizens

Better educated population, with greater purchasing power

Greater number of women working

Shorter workweek; more leisure time

7. Selling the Project

Buying and Buyers

Research shows buyers go through

identified stages when they buy

Figure 17.1 The buying cycle

(Cadle & Yates, 2005, p280)

Systems development projects have

buying committees and dont often follow the stages

Committee buying influences:

1. economic decision maker;

authority to spend

2. technical experts; evaluate

merit of solution

3. end-users; indirect effect on

purchase, concerned about

affect on them

4. champion or coach; assist in

preparing solution

Selling is an asking process

People who are most successful in selling systems development project or

consultancy assignments ask lots of questions

Example:

customers situationcustomers problemsimplications of problems

payoff or benefit from meeting the

needs

Prepare proposal for a potential buyer.

When assessing proposals you should include:

1. terms of reference

2. technical details of the solution

3. outlines advantages

4. aimed at all readers/buyers

5. clear diagrams

6. cross-references and navigational aids

7. summarized statement of costs

8. executive summary

Who is the Target Market?

Review

Marketing approaches have developed from a product-orientation to a customer-orientation IT industry slow to catch on.

Markets are groups that have needs for products and can be classified as; consumer, industrial, and reseller.

Marketing strategy is a plan to make the best use of resources, and consists of the target market, and marketing mix.

Marketing research can provide valuable information such as; education, retirement age, birth rates etc to project managers.

Buyers progress through stages when they buy, these include; need, options, concerns, implementation and change. Large IT

projects have buying committees.

Selling is a process of asking, and includes creation of proposal for buyer includes; terms, details, advantages, diagrams etc

Next Week

Topic: Project Leadership.

Reading: Gray & Larson, 2006, Ch 10.

References

Pride, W., Hughes, R. & Kapoor, J. Business (2nd ed.). Boston, MA.: Houghton

Mifflin.

http://flickr.com/photos/spine/272900992/

http://wendy.kinesisinc.com/

http://flickr.com/photos/7-how-7/95677126/

http://flickr.com/photos/missrogue/115899126/in/photostream/

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Title page pic care of rick & CC @ Flickrhttp://flickr.com/photos/spine/272900992/

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