the project management process - week 5
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Week 5 in the course - this time on marketing and how it relates to projects.TRANSCRIPT
Project Project ManagementManagement
4. Marketing and Project Management4. 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, Marketing is a process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods and services to pricing, promotion, and distribution of ideas, goods and services to
create exchanges that satisfy individual and organizational objectivescreate exchanges that satisfy individual and organizational objectives
What is Marketing?
Plan & Execute Exchange Satisfactio
n
ConceptionPricing
PromotionDistribution
People &Organisation
sGoods and Services
8
SellingSelling BuyingBuying
Exchange
Distribution
TransportTransport StorageStorage
Selling
Buying
Selling
Buying
Transport
Storage
Facilitating functionsFacilitating functions
FinanceFinanceRiskRisk
TakingTakingStandardizeStandardize
GatherGatherMarketMarket
InfoInfo
Selling
Buying
Transport
Storage
Finance
GatherMarket
Info8 Standardize
RiskTaking
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 M
ix(4 Ps)
Figu
re 1
1.2
Evol
utio
n of
the
cust
omer
orie
ntat
ion
(Prid
e, H
ughe
s & K
apoo
r, 19
98, p
321)
20’s
30’s
50’s
60’s
19C
Now
Permission marketing
Now
The Marketing Concept
is abusiness 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 There are different types of marketsmarkets
ConsumerConsumer ResellerResellerIndustrialIndustrial
Producer Producer GovernmentGovernmentInstitutionalInstitutional
ConsumerConsumerPurchasers and/or household members Purchasers and/or household members who intent to consume or benefit from the who intent to consume or benefit from the purchased products and who do not buy purchased products and who do not buy products in order to make a profitproducts in order to make a profit
Consumer ResellerIndustrial
Producer GovernmentInstitutional
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
Consumer ResellerIndustrial
Producer GovernmentInstitutional
Resellers consist of Resellers consist of intermediaries such as intermediaries such as wholesalers, and retailers who wholesalers, and retailers who buy finished products and sell buy finished products and sell them for profit.them for profit.
Consumer ResellerIndustrial
Producer GovernmentInstitutional
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 Figure 11.3 General approaches for selecting target markets General approaches for selecting target markets (Pride, Hughes & Kapoor, 1998, p324)(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)(Pride, Hughes & Kapoor, 1998, p325)
Figure 11.4 Figure 11.4 The marketing mix and the marketing environment The marketing mix and the marketing environment (Pride, Hughes & Kapoor, 1998, p327)(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 problem2. make a preliminary investigation3. plan the research4. gather factual information5. interpret the information6. reach a conclusion
Figure 11.5 Figure 11.5 Marketing information system Marketing information system (Pride, Hughes & Kapoor, 1998, p331)(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: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:customer’s situationcustomer’s problemsimplications of problemspayoff or benefit from meeting the needs
Prepare proposal for a potential buyer. When assessing proposals you should include:
1. terms of reference2. technical details of the solution
3. outlines advantages4. aimed at all readers/buyers
5. clear diagrams6. cross-references and navigational aids
7. summarized statement of costs8. 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 WeekTopic: Project Leadership.
Reading: Gray & Larson, 2006, Ch 10.
References Pride, W., Hughes, R. & Kapoor, J. Business (2nd ed.). Boston, MA.: Houghton Mifflin.
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