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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