Innovation and Creativity in Organizations - Case Study Example

Marketing Innovation and its Value Contribution Name: Lecturer: Course: Date: Introduction Marketing innovation translates into marketing promotion and functions, pricing, distribution in addition to processes aimed at creative product development (Doole and Lowe 2008). During the last decade, the value of marketing innovation attracted the interest of many scholars, particularly due to the proliferation of internet technology (Yannopoulos 2011; Silverstein 2001). In Doole and Loowe’s (2008) review of the international marketing strategy, they provided evidence supporting the fact that marketing innovation promotes organisational performance. However, Anderson et al. (2014) argue that in spite of the apparent significance of marketing innovation to businesses, it could still be observed that businesses traditionally focused on product innovation to improve their competiveness and profitability globally. Despite an awareness of the profit possibilities of creation of completely new and novel products and the processes of production, businesses have continued to be ignorant of the profit potentials of realising customer value satisfactions by using innovative marketing schemes (Yannopoulos 2011; Silverstein 2001). According to Silverstein (2001), organisations may completely overlook marketing innovations or use them on a “hit-or-miss” basis. Indeed, this rationalises the significance of this paper. Hence, this paper critically explores marketing innovation and its value contribution. It further critically evaluates the extent to which technological force from the marketing macro-environment influences organisation’s marketing strategy. Emphasis is placed on the internet. Section A Marketing innovation Innovation entails a set of processes that generate or create something new, which has a considerable value to an individual or organisation (Anderson et al., 2014). According to Doole and Lowe (2008), the outcome of an innovation process is innovation. In which case, innovation entails creation of an item that possesses significant value. Tinoco (2010) adds that infinite valuable creative ideas exist; although they may lack significant value in the manner they are applied. Hence, they are not necessarily an innovation. Innovation, therefore, has to have considerable value. Drawing from this, marketing innovation can be defined as the process of generating and implementing new ideas intended for creation, communication, and delivery of value to a business through creation of lasting customer management and customer-business relationships (Babu et al., 2013; Davenport &Mazalek 2004). Modern organisations and businesses today understand the importance of innovative ideas in their marketing structures, as their growth and survival of organisations is dependent on the extent to which they apply modern innovation. Silverstein (2001) suggests that when businesses and their management look to survive and succeed in the long-run, they have to be innovative and continuously adjust their marketing efforts to new situations. Several innovations and developments in marketing have emerged during the recent past. An example includes video innovation, such as a socially integrated live-streaming video service called Meerkat (Dobush 2015). Another popular innovation includes the messaging apps, such as Facebook, Snapchat, Kit and Whatsapp. In a practical business environmental, an organisation may share pictures regarding its brands via Snapchat. Another recent innovation is the smartwatch, which have apps, for music, shopping list, and maps, which can be targeted with marketing content. Marketers may as well build e-mail nurturing campaign (Dobush 2015). Additional marketing innovations include paid advertising, social media interactions, SEO marketing, organic search, andcontent marketing. Marketing value contributions In the modern-day marketplace where customers must have the ultimate say regarding an organisation’s sales, revenue, and profitability, business organisations are forced to be innovative in order to bring value to customers. When the value of the organisation’s results is greater than its costs, then the company would earn profits (Baker 1998). This denotes the significance of marketing. Innovative marketing has, therefore, transformed from its objective of systematic approach to managing activities inclined toward the market site. It has also changed customers’ perceptions on value (Tinoco 2010). Innovative marketing strategies have significant impacts on business performance and competitive advantage. According to Rampton (2015), these strategies enable business organisations to seek to align their strategies with innovative changes within the marketing mix, such as promotion, product, price and place in order to attain their strategies. Avlonitis and Karayanni (2000) also comments that apart from assisting the organisation to attain and sustain competitive advantage, innovative marketing techniques enable positive rating in business organisations, as well as assist them during theevents of economic crisis. Indeed, performance is often measured by surveying organisational growth, increased market share, and greater profitability. Consequently, marketing remains the key issue in determining organisational performance and its valuable consequence. A number of experimental and theoretical studies have also pointed to the fact that attaining competitive advantage is mostly a function of gaining leadership in innovative marketing and its associated aspects, such as innovative products (Rampton 2015). Some studies have further revealed that during economic crisis, marketing strategies in addition to four basic factors of marketing mix need to be adjusted to optimise their sale, income, and benefits (Baker 1998). For this reasons, an innovative method should focus on the positive effects. Therefore, it can be stated that innovative marketing strategies within the context of marketing mix have significant effects on the business and business processes (Kanagal, 2004). A survey of literature further reveals that a significant amount of innovation research shows that innovation provides value to business. Studies have indicated that innovation has intrinsic link to a firm’s performance (Ehret&Galanakis n.d.). Supporting this assumption, Tinoco (2010) indicates that innovation can improve an organisation’s performance in a range of ways, including financial. However, the cost of producing and marketing the innovative products may lead to a short-term decline in financial performance. Despite this, innovation increases an organisation’s survivability while failure to innovate may contribute to an organisation’s collapse (Yannopoulos 2011; Silverstein 2001). In a study by Tinoco (2010), the researchers showed how marketing innovations could propel an organisation to increase its profitability and growth in a competitive market. Tinoco’s (2010) study further provided evidence indicating a positive link between marketing innovation and organisational performance. The study indicated that production process innovation and product innovation have showed positive relationship with organisational performance. Hence, the manner in which technical innovations (which pertain to product, service, and production process technology) in addition to the administrative process innovations (which have a direct correlation to the basic business operations and entail organisational structure) lead to greater performance. Innovation also leads to sustainability. Basing their review on the manner in which the modern-day organisations have shifted their focus on sustainability, Doole and Lowe (2008) alluded to the fact that strategic sustainability today goes far beyond a lasting marketplace performance and deeper into the scope of environmental sustainability. In addition to promoting value to businesses by bringing about more profitable business processes and products, marketing innovation has ensured that the marketing practices are in line with the ongoing social and environmental concerns and corporate responsibility. Incidentally, the concept of corporate responsibility has been considerably linked to positive organisational financial performance outcomes (Baker 1998). Ultimately, by expanding the idea of innovation for sustainability on organisational performance, it is expected that marketing innovations bring about positive synergy, which is acquired when this element interacts with related types of innovation. In turn, innovation leads to improved organisational performance (Tinoco 2010). Additionally, viewing innovation in terms of how it improves sustainability augments the multidimensional approach to seeing innovation as essential when the strategic implications for an organisation have to be understood. Next, marketing innovations potentially grabs the innovative consumer’s attention thus adding to the potential of greater market share capture and organisational growth. It also aids in advancing toward greater competitive advantage and the dominant designer position. In effect, businesses have greater potential of reducing uncertainty risks when they make a well thought-out use of their marketing efforts and marketing resources (Avlonitis and Karayanni 2000). Section B TechnologyImpacts on Marketing in the ICT industry Review of current literature on the impacts of the internet and marketing innovation indicates that the internet technology has revolutionized the manner in which businesses are conducted in addition to its critical significance on the business success (Yannopoulos 2011; Avlonitis, & Karayanni 2000; Rampton 2015; Tinoco, J 2010). Yannopoulos (2011) shares the perspective that the internet has become a pervasive and requisite tool organisations have to use to thrive in the contemporary business setting. Within the context of business management, Silverstein (2001) perceives the internet to be information technology (IT) with a capability to diffuse among the business-to-business firms. The internet is an authoritative tool that businesses can apply to acquire greater competitive advantage. The technology provides varied opportunities that assist businesses achieve growth in sales and minimise the costs of marketing. Internet marketing at Hewlett-Packard (HP) Hewlett-Packard (HP) faces the challenge of aligning itself to become a part of its customers’ conversations on its technology products (Roy et al., 2011). Hence, the company has adopted digital channels like e-mail marketing, social media, display ads and online search. What has enabled HP’s marketers to optimise their digital marketing strategies is their capacity to capture and mine data systematically and cost-effectively using advanced analytical techniques. Such techniques have provided evidence on how the company benefits from internet marketing activities hence enabling marketers to adjust their marketing strategy (Baker 1998). Ultimately, this has enhanced customer engagement, and directly affected the revenues. Additionally, HP applies advanced analytics and operations research (O.R.) applications. These applications drive digital marketing strategies and prevail over business challenges. More organisations in the ICT industry are also leveraging the benefits of the internet in preference to the traditional media. Forrester Research Inc estimates that less than 20 percent of organisations are increasing marketing expenditure in traditional media, such as newspapers, magazines, television and direct mail while more than 60 percent are increasing expenditure on digital media, including social media, paid search and e-mail marketing (Roy et al., 2011). E-Marketing strategy at HP HP’s internet marketing strategy can be summated in three categories: Customers’ engagement and creation of awareness regarding HP products and services to enable effective lead generation. Provision of customized related content to customers and enhancing user’s experience. Addressing the aspects of revenue generation using online commerce (Roy et al., 2011). The impact of technology on HPs marketing strategy According to Tinoco (2010), due to the proliferation of the internet, today’s marketing practices and theory have undergone extraordinary transformations that are greatly attributable to the new marketing concepts and tools that the internet had brought about.The key thrust of such transformation in the practice of marketing has shifted to interactive marketing from broadcast marketing. The new trend brings about more interactive, responsive and customised marketing practices (Ghodeswar 2008).Within this context, the internet has presented an ultimate interactive medium for HP. In line with this assumption, Yannopoulos (2011) argues that management of the company’s relations with its environment become more feasible due to the interactive aspects of the internet, as these relationships come about due to “pattern of exchanges” through which the competitive advantage of a business is in its information-processing capability. At this juncture, the core advantages of the internet depends on its potential for speedy and efficient, interactivity and integration of various communication exchanges (Hemmatfar 2010). Additionally, an organisation gains a capacity to trigger demand for its products. For instance, internet marketing has enabled HP to create demand generation, such as forecasting traffic for the company’s online store. It has enabled the company’s online store to acquire an effective understanding of Web traffic’s key drivers in addition to ways it can use to increase the variety and accuracy of traffic forecasts (Roy et al., 2011). Proactive Customer Engagement The internet enables proactive customer engagement at HP (Roy et al., 2011). Yannopoulos (2011) explains that in the current digital age, customers experience the brand, as well as influence brand perception. In his view, businesses that can actively engage customers are likely to increase their circles of influence by creating “engaged customers” who are transformed to become brand ambassadors and advocates. HP has managed to keep its customers engaged hence attaining long-term sustainability and profitability. At the same time, HP’s engaged customers try out other company products (Roy et al., 2011). The company has deployed analytical techniques to take advantage of such insights at varied customer engagement phases. For instance, through the internet, the internet has enabled HP to identify certain customer needs by understanding their different consumption patterns or behaviour and expectations (Roy et al., 2011). Sales Management Activities The internet services can help create particular sales management activities. Studies have indicated that the internet is an ideal tool for achieving successful customer classification (Roy et al., 2011). For instance, USENET service used for integrating varied business discussion groups, where HP can trigger public conversations on its brand, may indicate the market segments where a large market segment lies (Larsen 2010). Hence, an organisation gained a capacity to focus its marketing efforts on specific markets segments that bring greater business values. Additionally, an internet service like the FTP allows businesses to access and manage their on-line customer databases where the current and potential files of the customers are stored, based on specific segmentation criterion. Rampton (2015) also shows that it enables an organisation to deploy targeted promotion activities, as well as direct emailing. Additionally, the internet enables HP to realise the finer market segmentation. In the same vein, Yannopoulos (2011) shows that, the internet technology leads to more innovative marketing paradigms of micro-segmentation or niche markets. Cingula and Veselica (2010) opine that through the internet, organisations become equipped to exploit virtual markets like those that can be developed using the internet in order to contend with micro-segmentation as a level of the individual customer, as well as the level of the individual customer during specific durations. According to Larsen (2010), the internet facilitates an interactive communication between marketers and their markets, as it provides new capacities to access remote databases using an on-line connection, as well as audiovisual presentations. Product Management Activities The internet is also featured in research literature as the ultimate medium that facilitates interactivity, and consequently reshaping the marketing paradigm. Avlonitis and Karayanni (2000) discusses that the two most vital features of internet interactivity include an ability to address people and greater capacity for memory storage.These attributes facilitate the creation of market-oriented product strategies at HP. In which case, the internet drives marketing to new levels of paradigm at HP, by enabling the company to sell its technology equipment to markets that are differentiated (Informs 2015). Silverstein (2001) argues that the internet has created a virtual world that enables business-to-business organisations to manage information, as well as create new customer values by fulfilling a greater portion of their needs. By this, it means the ease and efficiency of communication flows among businesses, which the internet facilitates, is expected to contribute to greater levels of information exchanges among the businesses. Consequently, it promote faster realisation of customer needs, as well as accelerates the rates of innovation at HP. Sales Performance Internet marketing through the social media enables HP to engage customers and build stronger customer relationships which drives greater sales performance (Roy et al., 2011). At HP, the internet offers an information infrastructure, which creates positive externalities, reducing communication and transaction costs, as well as making databases internally for sharing with customers and vendors, as well as encouraging inter-organisational relationships and collaboration. For instance, the company uses social media sites like Facebook and corporate blog to target customers with relevant sales pitch content. Hence, it is possible for the internet to possess spill-over effects to its suppliers, which can be leveraged to create sales leads. Therefore, the greater the application of the Internet tools, the greater impact it has on sales (Pulendran et al., 2003). Still, the internet’s potential as a direct sales channel to promote profitability has been questioned by some scholars. According to Cingula and Veselica (2010), companies achieve minimal sales based on internet advertising. Still, more scholars have promoted the idea that the internet provides a strong virtual market where users are engaged through social marketing platforms (Rampton 2015). Indeed, current studies suggested showed the increase potential of the internet to feature as a virtual marketing connecting organisations globally, as a result enabling them to expand into new markets, improve customer relationships, and lastly, enhance inter-organisational interactivity. Sales Efficiency and management of the sales-force The internet has significantly improved the efficiency and accountability of HP’smarketing department (Informs 2015). Indeed, the significance of the internet in promoting the efficiency and accountability of HP’s marketing operations and efforts has been overemphasised at the company due to the increased competitiveness of the ICT industry triggered by globalisation. Some scholars have also emphasised the internet’s great competitive advantage as an efficient tool for marketing (Tinoco 2010). Some researchers like Yannopoulos (2011) have, on the other hand, exposed marketing as a tool that facilitates sales force efforts hence contributing to greater sales productivity and efficiency levels. According to Avlonitis and Karayanni (2000), the internet significantly reduces the costs associated with exchange transactions. Therefore, the costs related to the recruitment and training of the sales workforce or identification and contacting potential buyers, assessing the capacity of the buyer, and carrying out transactions are reduced by the internet. Towards this end, the internet can serve as an ideal tool for servicing the current customers efficiently, particularly when it comes to the small and sparse accounts. Indeed, when it comes to the high-tech salespersons who sell in international markets, Avlonitis and Karayanni (2000) claim that their traditional roles as the middle agents between the service or production department and the customers is greatly reduced, as they would not be needed to create their technical backgrounds in order to create solutions to the problems that face customers, although their roles may become restricted to interpersonal communication roles with customers (Kotler & Keller 2009). Additionally, they anticipate that their duties, as providers of information, may vanish, indicating the reduction of the number of the individuals in the sales team. Hence, it can be argued that the greater the application of Internet tools in marketing efforts, the greater the impact it has on the sales efficiency, leading to reduction of costs in sales and customer service. Product and sales management efforts The internet contributes to the integration of HP’s marketing functions, leading to assigning of marketing opportunities to other organisational units, such as the sales management and supplies management departments (Informs 2015). Several organisational and technology scholars have given emphasis to the impacts of increased information intensity on the structure of organisations (Avlonitis&Karayanni 2000). The researchers agreed that internet proliferation can contribute to the integrating of the marketing function, and consequently, delegating some marketing operations to other departments. The outcome is an integration of organisational operations. Yannopoulos (2011) suggests that the internet can lead to the disappearance of the boundary between marketing and other organisation departments. Hence, it can be reasoned that the more an organisation is information intensive, the higher the extent to which related functional areas become engaged in activities traditionally linked to marketing. This indicates that organisations do not necessarily needs managers and employees that are knowledgeable about marketing. Rather, they need managers who understand certain set of customers and, therefore, enable the organisation to serve such needs ahead of competitors (Kotler & Keller 2009). Therefore, it can argued that increased information intensity of the Internet, sales and marketing employees take the lead in integration of the marketing intelligence regarding customer needs, which need implementing into customized product offering. Discontinuities in marketing Use of radical marketing innovations may as well prompt discontinuities in marketing, which leads to new marketing activities, as well as new customers, industries, markets and business areas. Some anecdotal evidences have indicated that smart competitors integrate fundamental product innovation with new marketing schemes. For instance, in the initial years of the calculator industry, competition was mainly among Casio, Hewlett-Packard (HP), and Texas Instruments and National Semiconductor. The four manufacturers pushed around with innovations to improve their calculator products by establishing a dominant design in order to improve their market share (Roy et al., 2011). Ultimately, Texas Instruments stood out as the leading manufacturer after it implemented an innovative marketing technique, mainly the pricing technique by setting up low prices during the product’s life cycle. The motive was to capture greater market-share in order to excite greater demand, ahead of moving to the lowest cost production and simultaneously high product quality. Hence, marketing innovation brought value to Texas Instruments by enabling it capture competitive advantage using unique pricing strategy, which moved beyond product differentiation. Anticipated changes in marketing trends in the ICT industry Due to the dynamic nature of the internet landscape, the innovating marketing strategies, such as paid advertising, social media interactions, SEO marketing, content marketing, and organic search will continue to change (Dobush 2015). Within the ICT industry, the application of the Internet to generate and disseminate marketing information will continue to intensify brand awareness, as well as promote sales (Lewis 2014). The social media will feature as the best means to make a brand appear real and accessible while simultaneously promoting conversations regarding ICT products and services (Dobush 2015). Additionally, since the social media presence has a potential to increase search engine rankings and a company’s visibility online, more ICT businesses will need to integrate the social media or be left out in the future marketplace (Lewis 2014). The mobile technology will also change the marketing trends in the future. More ICT companies will strive to apply mobile devices to access content while on the go. Hence, in order to maintain their relevance target market’s search, they will have to make information more accessible to mobile devices (Dobush 2015). Targeted advertising will also shape marketing trends in the ICT industry in future. More ICT companies will need to design ads that can reach out to their website’s visitors in order to promote greater visibility and greater conversion rates (Rampton 2015). Conclusion Innovating marketing has transformed from its objective of systematic approach to managing activities inclined toward the market site, as well as which change customer perceptions as value. Use of innovating marketing tools, such as the internet has had significant impacts on business performance and competitive advantage. For instance, internet marketing enables business organisations to seek to align their strategies with innovative changes within the marketing mix, such as promotion, product, price, and place in order to attain their strategies. They also enable proactive customer engagement at HP and creation of sales management. It also enables finer market segmentation. Apart from serving as the ultimate medium that facilitates interactivity, and consequently reshaping the marketing paradigm, the internet offers an information infrastructure, which creates positive externalities. It also reduces communication and transaction costs and encourages inter-organisational relationships and collaboration. Internet significantly improves the efficiency and accountability of HP’s marketing department. It also contributes to the integration of HP’s marketing functions, leading to assigning of marketing opportunities to other organisational units, such as the sales management and supplies management departments. 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