[1]utb 4464

Eine Arbeitsgemeinschaft der Verlage

Böhlau Verlag • Wien • Köln • Weimar

Verlag Barbara Budrich • Opladen • Toronto

facultas • Wien

Wilhelm Fink • Paderborn

A. Francke Verlag • Tübingen

Haupt Verlag • Bern

Verlag Julius Klinkhardt • Bad Heilbrunn

Mohr Siebeck • Tübingen

Nomos Verlagsgesellschaft • Baden-Baden

Ernst Reinhardt Verlag • München • Basel

Ferdinand Schöningh • Paderborn

Eugen Ulmer Verlag • Stuttgart

UVK Verlagsgesellschaft • Konstanz, mit UVK/Lucius • München

Vandenhoeck & Ruprecht • Göttingen • Bristol

Waxmann • Münster • New York

[2][3]Thomas Bieger

Marketing Concept – The St. Gallen Management Approach

Haupt Verlag

[4]Prof. Dr. Thomas Bieger is a full professor of Business Administration specializing in Tourism since 1999 and director of the Institute for Systemic Management and Public Governance at the University of St. Gallen. He was Secretary General of the AIEST (International Association of Scientific Experts in Tourism), and he is the chairman of CEMS (Global Alliance in Management Education). He held several guest Professorships at the University of Innsbruck and the Vienna University of Economics and Business. He also taught at the Simon Fraser University, Vancouver, at the Università della Svizzera italiana in Lugano and as William Fraser Fellow at the University of Otago, Dunedin/New Zealand. From 2003 until 2005 he served as a Dean of the Faculty of Management at the University of St. Gallen. From 2005 until 2010 he was Vice President, since February 1st 2011 he is President of the University of St. Gallen.

1st edition: 2015

Bibliographic information published by Die Deutsche Nationalbibliothek

Die Deutsche Nationalbibliothek lists this publication in the Deutsche Nationalbibliografie; detailed bibliographic data is available on the internet at http://dnb.dnb.de

All Rights reserved.

Copyright © 2015 Haupt

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Layout: René Tschirren

Einbandgestaltung: Atelier Reichert, Stuttgart

www.haupt.ch

UTB number: 4464

ISBN 978-3-8252-4464-4

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Brockhaus Commission, Kornwestheim

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[5]Preface

The St. Gallen Management Model created a comprehensive orientation framework for the management of companies and organizations of all kinds. Business processes play a special role in the model. They enable the real core function that justifies the existence of a company or organization, which is to deliver goods and services to third parties, usually for money.

This book is guided by the St. Gallen Management Model and, therefore, focuses on business processes. It also follows the approach of the marketing concept as an overall planning-and-designing approach, not just for marketing, but for all business functions. The content of this book thus offers an introduction to marketing as well as the design of business processes as a whole.

The book addresses two targets and thus two target groups: To begin with, it serves as a basis for the introduction to business administration as part of the Marketing Management curriculum during the Assessment Year at the University of St. Gallen. It covers the subject areas of marketing, performance and innovation.

At the same time, it is designed to appeal to the public at large as a basic text for study or practice. It serves as an introduction to or an update of knowledge in the areas of marketing and performance/performance process, while also presenting the marketing concept as a pragmatic thought-and-action approach used by generations of (marketing) managers.

The outline of the book follows the usual structure of a marketing concept and is also the basis for the division into six lecture blocks at the University of St. Gallen:

1. | Business Processes and Marketing Concept within the St. Gallen Management Model — an Introduction
2. | Market Analysis — from a Static to a Dynamic Point of View
3. | Marketing Strategy — from Market Segmentation to Positioning Strategy
4. | [6] Marketing Tool Application 1: Product Design and Performance
5. | Marketing Tool Application 2: Pricing, Promotion and Distribution
6. | Innovation and Controlling — Meta Processes of Business Activity

As a topical guide for decision makers and as teaching material on a university level, the book’s aim is not maximum depth and the transfer of detailed knowledge. Rather, the goal is contextual knowledge and new perspectives in thinking. As a textbook, it primarily points out the key sources.

At the same time, the integrative approach cultivated at the University of St. Gallen will be taken into account. This results from a focus on the St. Gallen Management Model as well as from methodically including the approach of networked thinking in the market-analysis section and by cross-referencing other disciplines, especially economics and law.

In part, this book is based on principles, concepts and text blocks of the book “Einführung in die Managementlehre” by Dubs, Euler, Rüegg-Stürm and Wyss (2009), which was used previously as a textbook at the University of St. Gallen and to which the author also contributed. The following authors also worked on the previous book in the area of business processes: Günther Schuh, Thomas Friedli, Torsten Tomczak, Fritz Fahrni and Sven Reinecke.

I want to thank Mrs. Margareta Brugger for transcribing the manuscript, student assistant Jessica Schulten-Baumer for revising and editing the text, and my wife Barbara for critical reading. I also thank Samuel Heer for his valuable support, not only in revising this book but also in our efforts to offer actual and method-oriented lectures on the assessment level of the University of St. Gallen. I also thank my colleagues o. Univ. Prof. Dr. Johannes Rüegg-Stürm and assistant professor Dr. Simon Grand for stimulating discussions, the good cooperation, and many valuable inputs.

May 2015
Thomas Bieger

[7]Contents

Preface

Table of Figures

1 | Business processes and marketing concept within the St. Gallen Management Model — an introduction
| 1.1 | Case study LÄDERACH
| 1.2 | Value-creation processes, companies and management
| 1.3 | Embedding business processes into the St. Gallen Management Model
|  | 1.3.1 | Stakeholders
|  | 1.3.2 | Environmental spheres
|  | 1.3.3 | Environments and sustainability
|  | 1.3.4 | Horizons of meaning
|  | 1.3.5 | Business processes within the St. Gallen Management Model
| 1.4 | Objectives of business processes
| 1.5 | Structure of business processes
|  | 1.5.1 | Performance processes
|  | 1.5.2 | Customer processes
|  | 1.5.3 | Innovation processes
| 1.6 | The marketing approach for the management of business processes
|  | 1.6.1 | Development of marketing
|  | 6.1.2 | Marketing concept
2 | Market analysis as the basis for market-oriented business management
| 2.1 | Case study MAMMUT
| 2.2 | Customer behavior and markets
|  | 2.2.1 | Definition and role of markets
|  | 2.2.2 | Players and market types
|  | [8]2.2.3 | Motives, needs, benefit and demand
| 2.3 | Market research objectives and data generation
|  | 2.3.1 | Identifying market sizes, needs and decision-making
|  | 2.3.2 | Supply-and-demand trends
| 2.4 | SWOT analysis as a synthesis of market analysis
3 | Marketing strategy — from market segmentation to a positioning strategy
| 3.1 | Case study JURA
| 3.2 | Marketing objectives
|  | 3.2.1 | Corporate objectives and marketing objectives
|  | 3.2.2 | Interaction of marketing objectives
| 3.3 | From market segmentation to a positioning strategy
|  | 3.3.1 | Segmentation criteria and segmentation level
|  | 3.3.2 | Choice of target market
|  | 3.3.3 | Positioning
| 3.4 | From customer processes to tool strategy
|  | 3.4.1 | Determinants of tool application
|  | 3.4.2 | Focus on marketing tool application in the marketing mix
4 | Product design and performance
| 4.1 | Case study STADLER RAIL AG
| 4.2 | Product design
| 4.3 | Performance provision — physical product
|  | 4.3.1 | Basic structure of the performance process
|  | 4.3.2 | Strategic decisions
|  | 4.3.3 | Operational decisions
| 4.4 | Performance provision — services
|  | 4.4.1 | Characteristic features of services
|  | 4.4.2 | Performance design and control of the service process
|  | 4.4.3 | From service chain to service blueprint
5 | Marketing tool application
| 5.1 | Case study JUNGFRAUBAHN
| 5.2 | Pricing policy
|  | 5.2.1 | Neoclassic pricing model
|  | 5.2.2 | Behavioral-science pricing models
|  | 5.2.3 | Functions of pricing
| [9]5.3 | Distribution policy
|  | 5.3.1 | Functions of distribution
|  | 5.3.2 | Distribution design
| 5.4 | Communication
|  | 5.4.1 | Role and function of communication
|  | 5.4.2 | Organizational scopes of communication
|  | 5.4.3 | Communication change
| 5.5 | Marketing mix
|  | 5.5.1 | Objectives of the marketing mix
|  | 5.5.2 | Planning the marketing mix
6 | Controlling and innovation
| 6.1 | Case study SWISS web portal
| 6.2 | Marketing controlling
|  | 6.2.1 | Development of a controlling concept
|  | 6.2.2 | Characteristics of marketing controlling
|  | 6.2.3 | Contribution accounting
| 6.3 | Innovation
|  | 6.3.1 | Functions, roles and tools of innovation
|  | 6.3.2 | Return on innovation
|  | 6.3.3 | Innovation in models
|  | 6.3.4 | Innovation’s directions of impact

Bibliography

Alphabetical index

[10][11]Table of Figures

Fig. 1: | Example of a value chain
Fig. 2: | Value-creation network and meta-system
Fig. 3: | Transaction interface and company
Fig. 4: | Management cycle according to Fayol
Fig. 5: | 4th generation of the St. Gallen Management Model
Fig. 6: | Stakeholders of a company
Fig. 7: | St Galler Management model with environmental spheres
Fig. 8: | Triple bottom line
Fig. 9: | Contents of the three horizons of meaning
Fig. 10: | Primary processes or business processes, according to Porter
Fig. 11: | Business processes and markets
Fig. 12: | Perceived customer value
Fig. 13: | Conceptual relation between customer value, added value and company value
Fig. 14: | Calculation of added value
Fig. 15: | Structure of business processes
Fig. 16: | Performance process as an added-value chain
Fig. 17: | Business process: goods and services
Fig. 18: | Service chain in incoming tourism
Fig. 19: | The customer buying cycle
Fig. 20: | Brand equity according to Interbrand — the ten most valuable brands in 2014
Fig. 21: | Five-phase product life-cycle model
Fig. 22: | Possible roles of companies in a value chain
Fig. 23: | Development of marketing
Fig. 24: | Marketing concept
Fig. 25: | Customer system
Fig. 26: | Benefits of long-term customer commitment
Fig. 27: | Transaction relationships in e-commerce
Fig. 28: | Composition of demand
Fig. 29: | Purchase decision for holiday travels
[12]Fig. 30: | SOR behavioral model
Fig. 31: | Theory of planned behavior
Fig. 32: | Market sizes
Fig. 33: | Importance of specific information sources in tourism
Fig. 34: | Travel motivation (1+ overnights)
Fig. 35: | Types of trends
Fig. 36: | Development of trends
Fig. 37: | Systematic analysis of new trends using the example of scooters
Fig. 38: | Example of a simplified tourism system and its dynamics
Fig. 39: | Market analysis as part of the marketing concept
Fig. 40: | Matrix of a SWOT analysis
Fig. 41: | Strength and weakness analysis of a typical Swiss destination
Fig. 42: | Demand trends and opportunities and threats deduced from them for a Swiss destination
Fig. 43: | Marketing strategy within the marketing concept
Fig. 44: | Goal hierarchy in marketing (exemplary)
Fig. 45: | From market segmentation to differentiation
Fig. 46: | Optimal segmentation
Fig. 47: | Multi-stage market segmentation for the skiing market
Fig. 48: | Statistical market segmentation by motives with the help of cluster analyses
Fig. 49: | Ways of illustrating brand positioning
Fig. 50: | Industry environment conditions and basic strategies for customer acquisition
Fig. 51: | Why customer retention pays off
Fig. 52: | Customer retention’s main tasks
Fig. 53: | Overview of marketing tools
Fig. 54: | Detailed planning of a marketing mix — marketing plan
Fig. 55: | From customer value to value of the customer
Fig. 56: | Conception levels for the product
Fig. 57: | Goods and services typology
Fig. 58: | Alternative decisions depending on program policy
Fig. 59: | Basic structure of the physical performance process
Fig. 60: | Basic structure of performance process
Fig. 61: | Conflicting priorities of strategic management in the vertical business area
Fig. 62: | Types of business
Fig. 63: | Characteristic features of services
Fig. 64: | Demarcation between service and material good
[13]Fig. 65: | Service chain in incoming tourism — destination point of view
Fig. 66: | Individual service chain
Fig. 67: | Service chain in outgoing tourism — perspective travel as a whole and travel agency
Fig. 68: | Concept of a service chain from a customer’s perspective
Fig. 69: | Demand curve as an aggregation of individual preferences
Fig. 70: | Price effect elasticities
Fig. 71: | Assimilation contrast theory
Fig. 72: | Price determination
Fig. 73: | Yield management systems
Fig. 74: | Yield management for booking systems
Fig. 75: | Strategic distribution
Fig. 76: | Example: Sales channel in tourism
Fig. 77: | Distribution system
Fig. 78: | Development prospects in distribution
Fig. 79: | General communication process and marketing communication process
Fig. 80: | Communication organization
Fig. 81: | Communication tools
Fig. 82: | Examples for tool goals in marketing
Fig. 83: | Detailed planning marketing mix — marketing plan
Fig. 84: | Marketing mix within the buying cycle
Fig. 85: | Management function according to Fayol
Fig. 86: | Possible indicators for measuring marketing’s success during a relaunch
Fig. 87: | Goal hierarchy and controlling
Fig. 88: | Product-specific multi-level contribution-accounting analysis
Fig. 89: | SWISS INTERNATIONAL AIR LINES controlling structure
Fig. 90: | Return on investment between the poles of innovation push and pull
Fig. 91: | The innovation process
Fig. 92: | Required innovation according to industry and goods
Fig. 93: | Innovation cube for the classification of strategic directions of impact
Fig. 94: | Marketing concept

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