On track but behind

Yes, the same story again: on track with my B629 studies, but way behind with the diary. I’m going to try to catch up, but it doesn’t look good!

First day school

The first day school took place today. Really enjoyable day, and a fantastic tutor. It’s a shame we see so little of our tutors when studying with the OU – but that’s the nature of the beast, I suppose.

It’s really eye-opening meeting someone who’s really knowledgeable about a particular subject, and knows it inside-out. Uncomfortable in some ways. It really makes me aware of my own shortcomings.

B629 week three: Market segmentation, targeting and positioning

I really enjoyed this week. It started with an explanation of what market segmentation is, and how organisations carry out market segmentation in order to better understand and serve their customers based on how groups have similar requirements.

The course then went on to look at segmentation methods, including the use of demographic variables, psychographic segmentation, and behavioural segmentation. Some of the examples given in this section were particularly interesting, including examples of segmenting by age (demographic) and by lifestyles (pscyhographic).

There was then a look at some organisational or internal market segmentation criteria, which would be particularly useful for managers who do not work in consumer markets, or deal directly with customers or other external stakeholders.

How organisations should target the market segments they identify was next to be considered. The criteria for targeting were detailed, including such factors and segment size and growth potential, measurability, profitability, etc. Some techniques for targeting were also given, including differentiated and undifferentiated targeting, focused, and customised targeting.

The idea of positioning was last of the topics, and how an organisation can use the concept of positioning to create a favourable image of itself in the minds of its customers, and in particular customer segments.

Positioning maps were introduced and an interesting case study of a university was given.

Very enjoyable week, and right up my street!

(Source: B629, Understanding marketing and financial information).

B629 week two: Customer satisfaction

What is customer satisfaction?

Customer satisfaction is not a difficult concept. Put simply, customers have expectations of the products and services they buy. If an organisation meets or exceeds these expectations, customers will be satisfied. However, if they fail to meet expectations, customers will be dissatisfied.

The danger of exceeding expectations is that customers will in turn adjust their expectations to the new level, and will automatically expect the new level to apply to all future exchanges!

The zone of tolerance

Parasuraman, et al. (1991) showed that there is a ‘zone of tolerance’ between two levels of customer expectation: adequate and desired; and that this zone can expand and contract according to circumstances such as what may have happened to the customer that day, whether they are in a hurry, etc.

Organisations must always strive to operate within the zone of tolerance if they are to have satisfied customers.


Expectations represent a combination of:

  • previous experience
  • situational clues
  • external information

Although it may not be possible to completely control a customer’s satisfaction process, it is possible to influence customer expectations – by carefully explaining to a customer what level of service or product performance they can expect. A different approach is to improve the customer experience by improving service levels or product performance.

Customer satisfaction and quality

There are many different definitions of quality, including perceived (by the customer or client) quality, the measurable characteristics , fitness for use, fitness for purpose, conformance to specification, and value for money. Quality can mean excellence (based on perceptions), or lack of defects (based on conformance), or value for money, according to Jackson, 1998. Quality is also considered to be relative to what something should be.

Slack et al. (1998) argues that quality is consistent conformance to customers’ expectations.

However it is defined, satisfying customers is central to quality.

Customers’ requirements

Bank (1992) points to five elements that customers take into account when considering quality. These can be used to judge the quality of the experience; however, expectations are likely to comprise a mixture of these elements in different combinations.

  • Specifications – what can I expect?
  • Conformance – will it do what I expect?
  • Reliability – will it continue to do what I expect?
  • Delivery – when can I have it?
  • Cost – how much do I have to pay?

People’s judgement of quality is a matter of how well their experiences live up to their expectations on the occasion.

Different customers are likely to have different expectations, even of the same product or service. They may also perceive the same product or service differently. The quality of a product or service is therefore whatever customers perceive it to be. This means providers must understand quality from the point of view of their customers.

Customer expectation of service quality

Parasuraman et al. (1985, 1991) identified a variety of aspects that determine a customer’s perception of service quality:

  • tangibles
  • reliability
  • responsiveness
  • communication
  • credibility
  • security
  • competence
  • courtesy
  • understanding/knowing the customer
  • access

What can be done?

Organisation constraints may limit what a manager can do to put customers first and respond to their needs, but constraints should be highlighted as issues, and not used as an excuse for inaction. Organisations need to remain open to new ideas.

If customers (whether internal or external) are to be satisfied It is important to allow staff and managers to take calculated risks and ‘learn by doing’. The right to make mistakes is vital in this.

(Source: B629, Understanding marketing and financial information).

B629 week one: What is marketing?

I’ve now completed week one of the course, and so far I’m really enjoying it. I’m finding it particularly interesting applying marketing concepts to my day job (which is not traditionally understood to be marketing-oriented).

A few notes to help me remember key points:

What is marketing?

Marketing is much more than selling or advertising – it covers the identification of customers, grouping of them into segments, researching needs, expectations and behaviours, and designing product or service offerings that meet those needs and expectations.

Need to be more aware of marketing for internal customers and stakeholders. For example, in IT, the other departments (business) in an organisation are internal customers. Other stakeholders such as business analysts and developers are also internal customers.

Marketing in different contexts

Marketing considers ‘wants’ as well as ‘needs’.

Marketing provides a means to satisfy customer needs. A need represent something that motivates customers to seek out a product or service to satisfy that need.

Need to be aware of the difference between internal and external stakeholders.

Also need to be aware of the difference between a process definition of marketing and marketing as a concept or philosophy.

Criticisms on marketing are that it places too much emphasis on profits and the for-profit context, meaning many of the concepts need to be adapted for other contexts. It is also criticised for encouraging excessive material consumption, particular in the for-profit context where marketing is associated with trying to get people to buy and consume more. Marketing is also criticised for focusing on immediate gratification of minor wants instead of larger, long-term needs – thus ignoring the wider social and environmental implications of the materialistic lifestyle.

Customers, consumers and clients

Need to recognise the difference between customers and consumers – they are not always the same individual (e.g. parent buying ice cream for a child).

Also need to be aware of the difference between customers and clients – especially how the power balance between the marketer and the person being provided with a product or service can be different depending on whether or not the person is a customer or client.

Exchange, fairness and satisfaction

A core concept in marketing is mutually satisfactory exchange. This usually means it needs to be regarded as fair – two things of equivalent value (financial or otherwise) will be exchanged.

Definition of fairness differs between people, but this usually means the exchange is free from unjustified bias or dishonesty.

In any exchange the amount of power held by the exchange partners will influence the level of fairness of the exchange.

If a product or service meets or exceeds expectations, the customer or stakeholder will usually feel they had a fair exchange. Otherwise, fairness will be judged on hoe the resulting dissatisfaction is resolved.

Consideration of fairness, power and exchange leads to the question of ethics in marketing. Marketing ethics refers to the question of whether marketing activities can be considered morally right or wrong.

– Utilitarianism is an ethical theory concerned with consequences.
– Deontology is concerned with whether the underlying principles of a decision are right.
– Virtue Ethics is concerned with the moral integrity of the individual making the decision.

Making ethical judgements is rarely clear cut! It is often appropriate to look at ethical questions using a number of theories before making a decision.

(Source: B629, Understanding marketing and financial information).