The Project Management Process - Week 5

Project Management 4. 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 & Execute Exchange Satisfaction Conception Pricing Promotion Distribution People & Organisations Goods and Services

8

Selling Buying Exchange

Distribution Transport Storage Selling Buying

Selling Buying Transport Storage Facilitating functions Finance Risk Taking Standardize Gather Market Info

Selling Buying Transport Storage Finance Gather Market Info 8 Standardize Risk Taking

The marketing mix Price Promotion Product Place

The marketing mix Price Promotion Product Place People Process Physicals

The marketing mix Price Promotion Product Place People Process Physicals Personalization Peer to Peer Participation Predictive models

2. Evolution of Marketing

19C WW1 20’s 30’s WW2 50’s 60’s 70’s 80’s 90’s Now Advertising industry develops Customer orientation What Next? Industrial Revolution Demand outpaced supply Production exceeds supply Marketing Mix (4 Ps)

Figure 11.2 Evolution of the customer orientation (Pride, Hughes & Kapoor, 1998, p321) 20’s 30’s 50’s 60’s 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 Reseller Industrial 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 Consumer Reseller Industrial Producer Government Institutional

Industrial Purchases 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 Consumer Reseller Industrial Producer Government Institutional

Resellers consist of intermediaries such as wholesalers, and retailers who buy finished products and sell them for profit. Consumer Reseller Industrial 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 organization’s 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:

define the problem

make a preliminary investigation

plan the research

gather factual information

interpret the information

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 don’t often follow the stages

Committee buying influences:

economic decision maker; authority to spend

technical experts; evaluate merit of solution

end-users; indirect effect on purchase, concerned about affect on them

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:

customer’s situation

customer’s problems

implications of problems

payoff or benefit from meeting the needs

Prepare proposal for a potential buyer.

When assessing proposals you should include:

terms of reference

technical details of the solution

outlines advantages

aimed at all readers/buyers

clear diagrams

cross-references and navigational aids

summarized statement of costs

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 References Pride, W., Hughes, R. & Kapoor, J. Business (2nd ed.). Boston, MA.: Houghton Mifflin. Gray & Larson, 2006, Ch 10. Reading: Project Leadership. Topic:

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