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ENDURANCE
Entrepreneurial Capacity-building for Sport

Training

Creating and retaining value for customers: a comprehensive introduction to Marketing for aspiring entrepreneurs
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Keywords

Marketing; Value; Output; Business; Market




Objectives/Goals

With this module, our objective is to facilitate learners’ understanding of Marketing and a series of “HOW TOs” that are directly related to the proficiency with this discipline, such as:

• define long-term communication strategies
• engage external public
• create and retain value for one’s own brand
• establish a positive reputation
• intercept needs and opportunities from the external environment
• define market positioning strategies
• outline a user-friendly and easy-to-understand marketing plan

Creating and retaining value

Creating and retaining valueClick to read  

In business, the concept of value is very flexible and can have different interpretations:

  • Value as QUANTITY – the amount of something produced, achieved, reached, etc. in a given period, also in terms of time invested.
  • Value as QUALITY – the quality standards of that given something generated in a given period, also in terms of time invested.
  • Value as OUTPUT – tangible results, more or less concrete as a product, a service or a strategy.
  • Value as OUTCOME – impact(s) that generates from OUTPUT(s), benefits that come in shapes and forms of, for instance: better expertise, higher profitability and competitiveness, market’s awareness of our offer, etc.
  • Value as REVENUES (R) – Price (P) * Quantity (Q) of a given product / service placed on the Market.
  • Value as PROFIT (∏) – R - Costs (C), i.e., salaries.
The Value EquationClick to read  

In a broader sense, business value builds from three key pillars:

Socio-economic context of reference.

It refers to the overall scale of phenomena that might have an influence on your business idea. Technologies and market trends represent two of the most impactful trends that (aspiring) entrepreneurs look into to design and scale-up their business idea.

Generally speaking, this dimension refers also to:

  • Competitors – strengths and weaknesses
  • Customers – actual and potential

Due to the typical scale and scope of sport-related business ideas, it is relatively easier to find specific market segments at high profitability margins. More than in other markets, clients of sport industry:

  • Are very well-informed
  • Tempt to aggregate in (online) communities
  • Cluster in well-recognizable segments
  • Have higher spending potential

 

Inputs’ processing

The value generation process falls under a framework that is common to all business.

It is the so defined IPO model:

Input

                → Process

                               → Output

In business studies, we tempt to consider Marketing among those activities defined as Primary*: contributing in first hand to reach the final client and generate revenues.

* Interpretation based on Porter’s Value Chain: Competitive Advantage, 1985, p.87

 

People

With People, we refer both to:

  • Internal workforce* – knowledge, expertise, skills and competences

! Those who make things happen!

  • External Stakeholders – groups of interest, and more in general, whoever might have an interest on business’ activities

*Contrary to Marketing, HR and People Management fall under Support activities – instrumental for a smooth implementation of Primaries.

…so what is Marketing about?

…so what is Marketing about?Click to read  

This section of the training module is dedicated to introduce participants to what we refer to in business environment when we talk about Marketing.

Generally speaking, people have a “sort of” idea on what is Marketing, as it is normally associated to promotion, advertising and communication. Although this is technically true, it is a very limited and reductive perception of Marketing and its focuses…

Two outstanding definitionsClick to read  

Any activity/task/effort/initiative formally aimed at stimulating customers’ interest can be intentionally considered as “Marketing”. A definition as such of Marketing cover a much larger area of interest that includes communication and promotion and goes way beyond it.

In the context of this training module, our favourite definitions of reference are represented by the ones from:

  • American Marketing Association (AMA)

[Marketing is] the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large.

  • Philip Kotler – considered by many as one of the most representative Marketing’s expert worldwide

[Marketing is] the process by which companies engage customers, build strong customer relationships, and create customer value in order to capture value from customers in return.

Relevant to notice is the difference between the twos:

AMA’s Marketing definition is very market-centred, including a wide range of activities and tasks aimed at satisficing not only customers’ satisfaction, but that of civil society and general public at large. Compared to AMA, Kotler’s definition is much more customer-centred.

Needs and wants…Click to read  

Regardless of the specific contributions academics and practitioners, all definitions applied to marketing revolving around to three everlasting pillars:

 

Types of Marketing based on the operative contextClick to read  

Depending on the operative context and the specific market that the organisation looks into, there are several Marketing’s frameworks:

  • Business to Customers (B2C), the form of marketing that we’re most used to and familiar with. B2C Marketing refers to that implant of activities and strategies implemented and carried out by an organisation to reach for consumers of product and services (i.e., the avarage Joe).
  • Business to Business (B2B), when companies and organisation are targets themselves of other organisations’ supply (raw materials, services, equipment and machinery, etc.).
  • Customer to Business (C2B), this format is the reversed version of B2C. C2B Marketing always existed and never expired from the scene. Nowadays, in the era of social media influencers, online reviews, blogging, etc., it is becoming even more tangible and valuable for organisation. When people participates in focus groups, surveys, interviews, etc. they a providing to businesses data (i.e., services) of great values that organisations will further process as inputs from the market.
  • Customer to Customer (C2C), made popular by e-bay and now normalised by the numerous online platforms that made of sharing economy their business model. C2C Marketing is when customers purchase goods/services one another through a third party mediator.

In practice, there are some quite significant implications for businesses operating in B2B markets, compared to B2C ones. The terms of this distinction are:

  1. Demand
  2. Purchasing volume
  3. Number and concentration of customers
  4. Distribution
  5. Negotiating power
  6. Promotion and advertising
  7. Other Influence variables

In the case of sport-related industries, for B2B and B2C, it is most likely that you will orientate your marketing activities to final consumers (B2C) or retailers / other actors of the production chain. In C2B, it is most likely that you will rely on this kind of formula when experiencing with influencers’ social media campaigns. C2C is a Marketing framework that applies to sharing economy’s businesses – very unusual (but not impossible) for sport-related industries.

Types of Marketing based on focusClick to read  

It is commonly accepted by theorists and professional that since 1930s, Marketing evolved through fours well-distinct eras. As we speak, we are culminating at the peak of the so defined “relationship” era.

The PRODUCTION era    →           focus on product

The SALES era                →           focus on brand