Week 2 Reading

WEEK 2 The marketing revolution A revolution in science - Polish scientist Nicolaus Copernicus proposed: we assume the sun, not the earth, is at the centre of our system - Earth moves around sun. instead of vice versa - Scientist Galileo proved the theory - Resulted in complete upheaval in scientific and philosophic thought A revolution in marketing - Revolution stems from idea that company is no longer centre of business universe - the customer is - Attention shifted from production problems to marketing problems o From the product that can be made to the product the customer wants the company to make PILLSBURY'S PATTERN: FOUR ERAS 1 st ERA - PRODUCTION ORIENTED - Manufacturing era - Began from formation of company (1869) to 1930s - Idea for company formation: availability of high-quality wheat and proximity of water power o NOT from:  Growing major market areas  Demand for better/less expensive/more convenient products - Charles A. Pillsbury's primary concern = production, NOT marketing - The company's first product reflects this: o Cattle nutrients o Main consideration = desire to dispose of a by-product o Product decision was product-oriented 2 nd ERA - SALES ORIENTED - In 1930s, Pillsbury moved to the sales era - Conscious of consumers - their wants and prejudices - Establish commercial research department to provide market info - More aware of importance of dealers, wholesalers, retail grocers o Vital link to chain of distribution

- Now want salesmen/dealers to have tools to move output of their plants to consumers 3 rd ERA - MARKETING ORIENTED - Pillsbury entered marketing era - Introduction of baking mixes + research program products = realisation can produce hundreds of new products - Faced with necessity of selecting best new products o Needed: build management function into company - control procurement -> production -> advertising -> sales  Criteria to select products to manufacture  Organisation to establish criteria + attain maximum sales of selected products - Business universe centered around customers The Brand-Manager Concept - 1 st move: transform advertising department into marketing department - Brand-manager idea formed Pillsbury marketing backbone - Brand manager fully accountable for results o Directs marketing of product o Production does its job, finance keeps profit figures o Responsibility encompasses:  Pricing  Commercial search  Competitive activity  Home service  Publicity coordination  Legal details  Budgets  Advertising plans  Sales promotion  Execution of plans - Marketing permeates entire organisation o Plans and executes sale: from inception of product idea -> development + distribution -> customer purchase o New product ideas are conceived after studying of consumer likes and dislikes o Marketing takes idea, uses forces of corporation to translate idea to product and product into sakes 4 th ERA - MARKETING CONTROL - Marketing sets company operating policy short-term