Chapter 15
Marketing and Supply Chain
Management
LEARNING OBJECTIVES
After studying this chapter, you should be able to:
1.
Articulate three of the four Ps in marketing (product, price, and
promotion) in a global context
2.
Explain how the fourth P in marketing (place) has evolved to be labeled
supply chain management
3.
Outline the triple As in supply chain management (agility, adaptability,
and alignment)
4.
Discuss how institutions and resources affect marketing and supply chain
management
5.
Participate in two leading debates concerning marketing and supply chain
management
6.
Draw implications for action
MARKETING AND SUPPLY CHAIN
MANAGEMENT
marketing - the effort to create, develop,
and defend markets that satisfy the needs and
wants of individual and business customers
supply chain - flow of products, services,
finances, and information that passes through
a set of entities from a source to the customer
supply chain management - activities to
plan, organize, lead, and control the supply
chain
TERMS RELATED TO THE FOUR
MARKETING Ps
product - offerings that customers purchase
market segmentation
-
way to identify
consumers who differ from others in purchasing behavior
THREE OF THE FOUR
MARKETING Ps
price - expenditures that customers are willing
to pay for a product
price elasticity - how demand changes
when prices change
total cost of ownership - direct and
indirect costs related to cost of purchase and
also all aspects in the further use and
maintenance of the equipment, device, or
system; a form of full cost accounting
THREE OF THE FOUR
MARKETING Ps
promotion - communications that
marketers insert into the marketplace: TV,
radio, print, and online advertising, as well as
coupons, direct mail, billboards, direct
marketing (personal selling), and public
relations
country-of-origin effect - positive or
negative perception of firms and products from
a certain country
FROM DISTRIBUTION CHANNEL TO SUPPLY
CHAIN MANAGEMENT
place - fourth P in the marketing mix - to the location
where products and services are provided which includes
the online marketplace
distribution channel—the set of firms that facilitate the
movement of goods from producers to consumers
TRIPLE As IN SUPPLY CHAIN
MANAGEMENT
agility - ability to quickly react to unexpected
shifts in supply and demand
adaptability - ability to change supply chain
configurations in response to long-term changes
in the environment and technology
alignment - way in which the interests of
various players involved in the supply chain align
make-or-buy decisions - decisions
whether to produce in-house or to outsource
TRIPLE As IN SUPPLY CHAIN
MANAGEMENT
make-or-buy decisions - decisions whether to
produce in-house or to outsource
third-party logistics - neutral intermediary in the
supply chain
INSITITUTIONS AND RESOURCES
AFFECT MARKETING AND SUPPLY
CHAINMANAGEMENT
most countries impose restrictions, ranging from taboos
in advertising to constraints on the equity level held by
foreign retailers and 3PL providers
most marketing blunders happen due to firms’ failure to
appreciate the deep underlying differences in cultures,
languages, and norms -all part of the informal institutions
norm in supply chain management is to source from
Asia
RESOURCES, MARKETING AND SUPPLY
CHAIN MANAGEMENT
VRIO criteria
traditional media are losing viewers, readers, and thus
effectiveness, but marketers do not have a good handle
of how advertising on the new online media adds value
managers need to assess the rarity of marketing and
supply chain activities – if all firms use FedEx to manage
logistics which does add value), these activities, in
themselves, are not rare
how likely is it for rivals and partners to
is the firm
objectives?
imitate?
organizationally ready to accomplish
MANUFACTURING vs. SERVICES
Consider contract manufacturing service. Is it
manufacturing? Service? Both? Does it matter?
Although marketing and supply chain management would
be regarded as services historically, this classification
may not matter that much.
Does McDonald’s manufacture hamburgers? How much
difference is there between McDonald’s and Boeing?
Both market new products, both make to order (finalize a
product based on an order), and both extensively rely on
powerful supply chain management systems around the
world.
Market Orientation vs.
Relationship Orientation
Market orientation refers to a philosophy or way of
thinking that places the highest priority on the creation of
superior customer value in the marketplace.
A market-oriented firm genuinely listens to customer
feedback and allocates resources accordingly to meet
customer expectations.
Relationship orientation, defined as a focus to
establish, maintain, and enhance relationships with
customers.
Marketers have heavily debated whether a market
orientation or a relationship orientation is more effective
in global markets. Key to the debate is how firms benefit
from market or relationship orientation differently around
the world.