The most recent CBI Services Sector Survey suggests that service sector businesses are still running at below normal levels but less than in the previous quarter. Pressure on profits and deflation are not helping.
Business and professional services' volumes and values both increased slightly for the first time since May 2008 and many firms expect it to continue to increase over the next three months. However they remain below normal for the seventh consecutive quarter. Profitability suffered because of lower prices, which are expected to fall further over the next three months as competition for business continues, but may increase slightly over the coming quarter. Employment also fell again for the fifth successive quarter but less steeply than earlier in the year. Business and professional services are more optimistic than they have been for a long time.
Consumer services values and volumes fell slightly but at much slower rates than the previous three quarters. Over the next three months firms expect values to stabilise and volumes to decline. Optimism is not as strong as three months ago. Profitability in consumer services also suffered from lower prices which are also expected to continue to fall over the next quarter. Employment in consumer services was stable.
Service sector activity was less weak than in recent quarters and things may be beginning to look a bit better.
Showing posts with label competition. Show all posts
Showing posts with label competition. Show all posts
Friday, 28 August 2009
Monday, 16 February 2009
Am I My Brother's Guardian? - Risks In International Marketing
The globalisation process has meant radical changes all over the world. Global competition affects everything everywhere. For many people the world has got a lot smaller in terms of geographical and cultural differences. Many businesses have been able to expand their market coverage. Companies are able to take advantage of new opportunities in selling and buying abroad (Kotler, 1999).
International firms may have to co-ordinate their operations functions across borders. The various departments of a company may take place in several countries. Those who want to 'Buy British' may have to carry out some research to find out where the parts, components, manufacturing and assembly of their desired items were carried out. British products are often made abroad and 'foreign' products made here (Kotler, 1999).
Global marketing means that more companies than ever are in strategic alliances with other companies from abroad to some degree. The need for technological and marketing resources is forcing companies to look for partners. Customers expectations are raised by these developments. 'More for less' is offered by many companies and customers are offered quality products at discount prices (Kotler, 1999).
At the same time consumers expect businesses to take responsibility for the social and economic impacts of their activities. Pressure groups are placing strict demands on companies regarding air, water and soil pollution, rain forests, global warming and endangered species (Kotler, 1999). Ethical requirements differ from one place to another. Business practices in some countries may create a moral dilemma for businesses with social and environmental policies (Brassington and Petitt, 2000).
Customers are more internationally oriented and suppliers have to follow. In the service industry it may be better to stay close to the customer and locate appropriately. Culture is important and understanding the conventions and etiquette of the local culture is vital (Brassington and Petitt, 2000).
The economic risks are also greater than before. International marketing involves exposure to exchange rate risks. Changing currency from home to host or some other agreed currency and then buying the item may involve a change in the exchange rate. The ERM reduces most of the uncertainty for members. A strong currency can put potential traders off. A weak pound favours exporters. High foreign country debt and inflation may be problematic. In poor countries the problem might be inability to pay. Entry requirements to host countries relate to a variety of working practices and marketing mix adaptation costs will also have to be considered (Jeannet and Hennessey, 1998, Kotler, 1999).
Businesses also face risk due to changes in the political climate affecting the way partners interact. A company could lose all of its investment in another country because of the influence of special interest groups and the prevailing political philosophy. A sudden change of power may lead to a hostile political climate. It is advisable to do a political risk assessment where there is any doubt about a potentially volatile political climate. The assessment can be integrated into risk reduction strategies to help with business continuity in the markets entered, to leave a market or not enter and to analyse genuine market opportunities (Jeannet and Hennessey, 1998).
Competitive behaviour and product liability regulations can be complex. International and supranational regulations can be contradictory or enforced differently. Complaints about unfair competition can be taken to the host country, the regional bloc, like the EU, or global bodies like the WTO.
The broadening of marketing boundaries brought about by globalisation and the complete changes in Eastern Europe has produced trends of trade liberalisation, deregulation and privatisation (Jeannet and Hennessey, 1998). It will bring opportunities and competition. Systems and structures can be developed to exploit the opportunties that arise.
International firms may have to co-ordinate their operations functions across borders. The various departments of a company may take place in several countries. Those who want to 'Buy British' may have to carry out some research to find out where the parts, components, manufacturing and assembly of their desired items were carried out. British products are often made abroad and 'foreign' products made here (Kotler, 1999).
Global marketing means that more companies than ever are in strategic alliances with other companies from abroad to some degree. The need for technological and marketing resources is forcing companies to look for partners. Customers expectations are raised by these developments. 'More for less' is offered by many companies and customers are offered quality products at discount prices (Kotler, 1999).
At the same time consumers expect businesses to take responsibility for the social and economic impacts of their activities. Pressure groups are placing strict demands on companies regarding air, water and soil pollution, rain forests, global warming and endangered species (Kotler, 1999). Ethical requirements differ from one place to another. Business practices in some countries may create a moral dilemma for businesses with social and environmental policies (Brassington and Petitt, 2000).
Customers are more internationally oriented and suppliers have to follow. In the service industry it may be better to stay close to the customer and locate appropriately. Culture is important and understanding the conventions and etiquette of the local culture is vital (Brassington and Petitt, 2000).
The economic risks are also greater than before. International marketing involves exposure to exchange rate risks. Changing currency from home to host or some other agreed currency and then buying the item may involve a change in the exchange rate. The ERM reduces most of the uncertainty for members. A strong currency can put potential traders off. A weak pound favours exporters. High foreign country debt and inflation may be problematic. In poor countries the problem might be inability to pay. Entry requirements to host countries relate to a variety of working practices and marketing mix adaptation costs will also have to be considered (Jeannet and Hennessey, 1998, Kotler, 1999).
Businesses also face risk due to changes in the political climate affecting the way partners interact. A company could lose all of its investment in another country because of the influence of special interest groups and the prevailing political philosophy. A sudden change of power may lead to a hostile political climate. It is advisable to do a political risk assessment where there is any doubt about a potentially volatile political climate. The assessment can be integrated into risk reduction strategies to help with business continuity in the markets entered, to leave a market or not enter and to analyse genuine market opportunities (Jeannet and Hennessey, 1998).
Competitive behaviour and product liability regulations can be complex. International and supranational regulations can be contradictory or enforced differently. Complaints about unfair competition can be taken to the host country, the regional bloc, like the EU, or global bodies like the WTO.
The broadening of marketing boundaries brought about by globalisation and the complete changes in Eastern Europe has produced trends of trade liberalisation, deregulation and privatisation (Jeannet and Hennessey, 1998). It will bring opportunities and competition. Systems and structures can be developed to exploit the opportunties that arise.
Wednesday, 28 January 2009
Winning Hearts And Minds
The changes that have taken place in advertising over recent years has been amazing. Television, radio, the Internet and other new media have added so many different dimensions to advertising that it bears little resemblance to the paper notices and lineage of the past. That is not to say that the adverts and advertisers of earlier days were not good. They still inspire marketers today but the new techniques and media have added so much and so many different kinds to the panoply of practitioners in a short space of time that it could be described as kind of revolution.
The media have increased but that is no guarantee that the offering will be successful and bring in lots of new customers. The message has to be right. You have to be satisfied that the message you put out is the one you want the consumer to get. The response to the right message will tell you if the market is there for your product. Consumers are only human and if the marketing mix isn't quite right it will be reflected in sales. Each element of the marketing, advertising and promotion mixes is crucially important. Consumers respond to stimuli and behave accordingly. The number of things to be borne in mind when designing a campaign is staggering. The marketer has to know the product well enough to be able to sell it and the learning and memory abilities of the public. Consumer motivation will affect buying decisions.
We all have our values, core values taught by socialisation agents and value systems ranking things according to relative importance will ultimately have a lot to do with if we buy or not. Values are also incorporated into the means-end chain model which links product attributes according to increasing levels of abstraction to our terminal values (Solomon, Bamossy and Askegaard, 2002).
On the abstract level, many different product forms compete for our attention in any given category. Consumers must make a choice using their own decision rules. Marketing campaigns that are well integrated can do much to educate the public about your product and the choice they have to make. Consumers also have their own internal information system. Heuristic rules of thumb help a consumer to shorten information processing. Consumers develop assumptions about companies and products. These market beliefs can act as mental shortcuts whether they are accurate or not (Solomon et al., 2002).
Then there's the competition. The marketing concept says that competitive advantage is gained by satisfying target customers' needs better than the competition. First comes analysis then strategy development. Product category must be the first thing to consider. Companies in the same industry compete for customers in the market. Once a company enters a strategic group the members of that group become its main competitors. The more a company knows about its competitors' products, prices, marketing and sales plans, distribution coverage and so on the more competitive it will be (Kotler, 1999). Research and development and finance are other key strategies of which to be aware. Competitors can be of any number of classifications. If a competitor comes up with a more attractive rival product you may lose customers. Market orientation is a method that combines efforts to focus on both consumers and competition. You may want to win the hearts and minds of consumers.
Political consumers can use their buying patterns in ways that reflect their values in the same sort of way green consumers once did (Solomon et al, 2002). They are not the only people to say that businesses have too much political power. Pressures from the political and regulatory environment may also affect consumer decisions. They determine and maintain the framework within which business must be done (Brassington and Pettitt, 2000). Knowledge of local practices may be crucial in achieving sales (Kotler, 1999).
Income, social class and age will be factors that affect purchase decisions. Ability and willingness to buy depends on demand for products. Demand for necessities is stable over time. Many other products are frequently used as status symbols and often reflect the amount of discretionary income and conspicuous consumption or parody display that tries to avoid status (Solomon et al., 2002). Engel's Law suggests that such products may always find a market (Kotler, 1999). Money worries and anxieties about self-image and reference groups will have their effects and marketers should remember that if the price is not right consumers will look for substitutes.
Once gained, as many customers as possible should be retained. Retaining customers is more cost-effective than gaining new ones (Brassington and Pettitt, 2000). Customer retention will depend on how well needs have been satisfied. The focus was once on transactions now customer satisfaction also demands relationship marketing techniques like financial and social benefits and structural ties to turn customers into clients (Kotler, 1999).
The media have increased but that is no guarantee that the offering will be successful and bring in lots of new customers. The message has to be right. You have to be satisfied that the message you put out is the one you want the consumer to get. The response to the right message will tell you if the market is there for your product. Consumers are only human and if the marketing mix isn't quite right it will be reflected in sales. Each element of the marketing, advertising and promotion mixes is crucially important. Consumers respond to stimuli and behave accordingly. The number of things to be borne in mind when designing a campaign is staggering. The marketer has to know the product well enough to be able to sell it and the learning and memory abilities of the public. Consumer motivation will affect buying decisions.
We all have our values, core values taught by socialisation agents and value systems ranking things according to relative importance will ultimately have a lot to do with if we buy or not. Values are also incorporated into the means-end chain model which links product attributes according to increasing levels of abstraction to our terminal values (Solomon, Bamossy and Askegaard, 2002).
On the abstract level, many different product forms compete for our attention in any given category. Consumers must make a choice using their own decision rules. Marketing campaigns that are well integrated can do much to educate the public about your product and the choice they have to make. Consumers also have their own internal information system. Heuristic rules of thumb help a consumer to shorten information processing. Consumers develop assumptions about companies and products. These market beliefs can act as mental shortcuts whether they are accurate or not (Solomon et al., 2002).
Then there's the competition. The marketing concept says that competitive advantage is gained by satisfying target customers' needs better than the competition. First comes analysis then strategy development. Product category must be the first thing to consider. Companies in the same industry compete for customers in the market. Once a company enters a strategic group the members of that group become its main competitors. The more a company knows about its competitors' products, prices, marketing and sales plans, distribution coverage and so on the more competitive it will be (Kotler, 1999). Research and development and finance are other key strategies of which to be aware. Competitors can be of any number of classifications. If a competitor comes up with a more attractive rival product you may lose customers. Market orientation is a method that combines efforts to focus on both consumers and competition. You may want to win the hearts and minds of consumers.
Political consumers can use their buying patterns in ways that reflect their values in the same sort of way green consumers once did (Solomon et al, 2002). They are not the only people to say that businesses have too much political power. Pressures from the political and regulatory environment may also affect consumer decisions. They determine and maintain the framework within which business must be done (Brassington and Pettitt, 2000). Knowledge of local practices may be crucial in achieving sales (Kotler, 1999).
Income, social class and age will be factors that affect purchase decisions. Ability and willingness to buy depends on demand for products. Demand for necessities is stable over time. Many other products are frequently used as status symbols and often reflect the amount of discretionary income and conspicuous consumption or parody display that tries to avoid status (Solomon et al., 2002). Engel's Law suggests that such products may always find a market (Kotler, 1999). Money worries and anxieties about self-image and reference groups will have their effects and marketers should remember that if the price is not right consumers will look for substitutes.
Once gained, as many customers as possible should be retained. Retaining customers is more cost-effective than gaining new ones (Brassington and Pettitt, 2000). Customer retention will depend on how well needs have been satisfied. The focus was once on transactions now customer satisfaction also demands relationship marketing techniques like financial and social benefits and structural ties to turn customers into clients (Kotler, 1999).
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