How is Marketing Changing in Today´s Business Environment?

Marketers must learn how to understand and capitalize on the needs of new markets, segments, and consumers, including people with incomes much lower than those that most marketers were accustomed to in the past.

The biggest shift in today's marketing world isn't the much-discussed declining effectiveness of television advertising but the changes in how consumers research and buy products. The Internet is a major contributor to this shift. In categories as diverse as electronics, financial services, and health care, consumers increasingly ignore push marketing, preferring instead to use the Internet to research products and decide which ones to buy.

But the change in consumer buying habits is broader. The proliferation of distribution touch points and the more rapid growth of the low and high ends of the market at the expense of the middle are forcing marketers to take low-cost, time-saving, sales approaches and, at the same time, higher-value, more service-oriented approaches, often through alternative distribution channels.

Also, emerging markets are grabbing a larger share of global GDP, and the developed economies' middle market is stagnating.

A yet much broader issue is that marketers must work more intensively than they have in the past with colleagues in other functions to develop, deliver, and communicate value propositions to consumers who aren't willing to pay as much as before. Changing customer needs create an opportunity to boost sales, but manufacturing, marketing, and sales must cooperate if the company is actually to capitalize on the evolving market needs.

The role of marketing is broadening. In addition to traditional responsibilities such as building brands, making advertising more effective and market research, marketers must address several other areas as well: leading company-wide change in response to evolving buying patterns, managing complexity and building new marketing capabilities throughout the company as a whole.

Marketing changes to reflect new consumer buying behavior include a need for tighter integration between corporate marketing and sales as web-based channels expand their role in advertising, sales, and marketing. This tight relationship between marketing and critical business changes extends to emerging markets, whose growing importance will place exacting demands on the entire organization to develop, produce, and deliver lower-cost goods and services.

The changing environment calls for new marketing capabilities, both in the marketing organization and in the company as a whole. Within marketing, for example, the ability to build brands across an increasing number of media, including vehicles dominated by user-generated content, will be critical. Many companies will have to manage an increased number of advertising and PR agencies and to build new skills for creating integrated messages. There also will be analytic muscles to build, such as the data-management skills needed to compare and maximize the effectiveness of on- and offline marketing expenditures.

With more countries, more customer segments, more media and more distribution channels, companies and their marketing executives are waging a battle with complexity. The “think global, act local” strategic imperative faces one key challenge - reconciling local entrepreneurship with global and cross-segment brand consistency.