Marketing in the UK: O2's Competitive Analysis and Plan

This report provides a comprehensive overview of marketing concepts, including its definition, current and future trends, and the marketing process. It delves into the roles and responsibilities of a marketing manager, highlighting their influence and interrelation with other functional departments within an organization. The report also explores the marketing mix and its elements, using O2 as a case study to analyze its product, pricing strategies, and competitive positioning within the UK telecommunications market. Furthermore, the report includes a detailed marketing plan developed for O2, based on competitive research and analysis, offering insights into strategic considerations and practical applications within the marketing field.

The role of marketing and how it interrelates with other
functional units of an organisation
Introduce the concept of marketing, including current and future
trends
The UK’s Chartered Institute of Marketing defines the concept of marketing as:
‘The management process responsible for identifying, anticipating and satisfying
customer needs profitably’
(F1/FAB Examiner, ACCAglobal, 2017)
It cannot be underestimated the key contributors for the success of a marketing
concept of the following key areas; firstly a clearly defined strategy with goals and
objectives outlined from the start; secondly, a clear management process, often with
an executive director who adheres to the functional responsibilities; finally, the
understanding that the role of marketing is to understand the customer’s needs in
order to sell the right product or service.
Forbes (forbes.com, 2017), describes the current and future trends to include the
following points:
- The importance of the mobile phone as a marketing tool, developing a more
‘personalised’ and consistant relationship with the user
- Good visual content which will continue to dominate with user-generated
content becoming more directly involved in the marketing process
- And with consumers becoming more directly involved in the marketing
process, transparency between brand and consumer will be ever more
integral to promoting loyalty and interest of the consumer to the brand
The following image (Figure 1) details the marketing process within a marketing
intelligence model.

Fig. 1. (www.globalintelligence.com, 2010)
We can simplify the essence of this Marketing Intelligence model into the following
diagram (Figure 2) where we firstly identify our customer’s needs, analyse the
‘need situation’, unpack this information in order to develop a marketing strategy.
Fig. 2: The process of competitive Intelligence (McCall, 2006)
Upon completion of this process it becomes important to choose the correct
marketing mix to implement in order for the process to be both profitable to us,
sustain future business and be useful to the customer’s needs.

The marketing mix is illustrated by Acutt in the book Marketing Mix Debunked:
Fig. 3: The Marketing Mix (Acutt, 2017)
Give an overview of the different marketing processes
Marketing processes can be used as a strategy to obtain a greater percentage of the
market share, or retain existing customers. Feedback is obtained at different stages
when implementing a marketing process including receiving customer reviews.
The marketing mix is . . . The set of controllable tactical marketing tools – product,
price, place, and promotion – that the firm blends to produce the response it wants in
the target market.
Kotler and Armstrong (2010).
The marketing mix can be broken down into what is known as the 7Ps:
- Product
- Price
- Place
- People
- Promotion
- Physical Environment
- Process
Each of the 7Ps has tools linked to its contribution to the marketing mix. For
example, a product can be defined by its variety and differentiation from the rest of

the market, also its quality, features, the services and brand values associated with it
and the packaging it is presented in. Price can be defined by the cost relative to the
market, any discounts applied, a payment period or even credit terms which can
make a once inaccessible item now accessible by a greater number of people. Place
can be linked to the logistics of a particular service, a specific location a product is
present in and the emotional values or memories linked to that place, or even
transportation and access requirements/ social status required to reach a particular
location. Finally promotion can be related to PR and styles of advertising campaigns
which are used to tap into a particular mind-set/ consumer, or a sales promotion
which encourages multiple sales or continued future purchasing leading to loyalty.
P1 Explain the key roles and responsibilities of a marketing
manager
The marketing manager holds both long-term and short-term marketing strategy
responsibilities and is required to interact with other functional departments within
the firm. The main aim of the duties is to sustain and/or develop the brand
(Smallbusiness.chron.com, 2017). This is in creating a sensory experience through a
mixture of visuals, sounds, smells and physical experiences - depending upon the
most relevant according to the promoted product or service.
The marketing manager works directly with senior management within the firm in
order to ensure there is a consistency among all departments and that the message
which is delivered to the target customer is both strong and coherent. The
organisation’s ‘mission statement’ is key in this.
Upon deciding a strategy, the marketing manager then directs clear objectives and
holds discussions with both the firm’s own PR and advertising departments and
external media organisations. It is important to have this relationship due to the
impact of a negative or incorrect message can have on a business’ reputation. For
example, when retail giant Target suffered a decline in share prices after being
negatively associated with supporting a political action committee who opposed gay
rights (MarketWatch, 2017).
The key roles of a marketing manager can be outlined as follows:
- Conducting consumer research through a range of surveys and focus groups
to understand more about the needs of the customer
- Analyse competitor advertising strategies and sales performances by keeping
up to date with the latest public sales reports published and an up to date
understanding of current advertising campaigns along with future trends.
There are a range of trend predicting companies (example) which investigate
consumer behaviour and lifestyle choices which can impact upon future
purchasing decisions.
- Further to this, he or she may analyse the economic status and so hold close
relations with the financial departments. Financial intelligence, paired with

trend predictions can help a firm to make early decisions to avoid a deficit or
reduced profits, especially in unstable or ‘credit crunch’ environments.
- Overseeing the marketing budget
- Working closely with design agencies to assist with product launches
- Examining potential ‘strategic partner relationships’ (Charterselection.com,
2017) which may strengthen the business through effective collaboration or
‘limited edition’ promotions
The information collated into a report by the marketing manager in the above roles,
can influence critical business decisions made by senior management.
It is important that all of the company functions are informed of changes or
developments with the marketing strategy and so internal communication between
the departments is crucial in maintaining the firm’s overall strategy.
P2, M1, M2 and D1 Explain how roles and responsibilities of
marketing influence and interrelates with other functional
departments
The role of marketing within an organisation has come into question over the past
few years. Questions arise over what value the marketing function has and what role
it plays.
Moorman and Rust describes marketing’s ability to connect the customer to, firstly
the product, secondly the service, and finally financial accountability.
In order to understand more about marketing’s influence within other functional
departments we must consider, marketing’s role, marketing performance perceived
and actual value, the market orientation and finally the firm’s performance.
In their journal article, Moorman and Rust display an effective diagram to show how
the interrelation between marketing and other functional departments in a firm
(Figure 4)

Fig. 4: ‘The functional influences on the connections between central elements of the firm’
(Moorman and Rust, 1999)
In this above diagram we can see how marketing dominates the three strands which
connects the customer to the other functional departments in a brand. It becomes
the connective element in such relationships:
1- Customer: product
2- Customer: service delivery
3- Customer: financial accountability
Workman, Homburg, and Gruner (1998) describe this as a ‘cross-functional
dispersion of marketing activities’. They state that, if the roles of marketing are
dispersed across several functional departments, then the role of marketing
becomes strengthened as it is more clearly integrated within the department it is
targeted at. Moorman and Rust argue that ‘the effectiveness of a market orientation
depends on the presence of strong function that includes marketing’, and so here we
explain how such roles and responsibilities of marketing influence and interrelates
with other functional departments.
The role of marketing and its importance within a firm firstly depends upon its context
and the type of firm it is situated within. If the marketing department is a separate
entity and a ‘functional marketing organisation’ (Moorman and Rust, 1999) then the

roles and responsibility it holds for those roles is more highly concentrated and
specialised within its own department. If spread across multiple departments, in what
is called a ‘marketing process organisation’ (Workman, Homburg, and Gruner 1998),
its specialism is more adapted towards the particular department it is situated in. it
may by beneficial to have a separate functional marketing organisation in a firm may
enhance its efficiency and ‘ability to develop specialized, distinctive capabilities’
(Thompson and Strickland 1983). However, contrary to individual units, a sole
functional marketing unit may suffer from ‘interfunctional conflict’ and
‘overspecialisation’ (Moorman and Rust, 1999).
To conclude, it has been suggested that, in order to have a successful market
orientation multiple departments must effectively interrelate, share information
regarding the target customer and perform relevant activities which are designed to
meet the needs of the customer (Narver and Slater 1990). It is considered, from
some scholars, that the existence of marketing as its own department is becoming
rarer, with greater integration within existing other functional departments of an
organisation (Webster, 1989). However, the truth of this is yet to be seen.
References
Acutt, M. (2017). The Marketing Mix Debunked. 1st ed. USA:
www.marketingmix.com.
Charterselection.com (2017). Marketing Manager Job Description. Charter Selection [online] Available
at: http://www.charterselection.com/56/marketing-manager-job-description [Accessed: 10 Jun.
2017].
Forbes.com. (2017). Forbes Welcome. [online] Available at:
https://www.forbes.com/sites/danielnewman/2015/04/14/10-top-trends-driving-the-future-of-
marketing/#5018a78c5f97 [Accessed 11 Jul. 2017].
Gallup (2006). Competitive Intelligence: The Process. [image] Available at:
http://www.gallup.com/businessjournal/23149/james-bond-comes-
boardroom.aspx [Accessed 8 Jun. 2017].
Gallup, I. (2017). James Bond Comes to the Boardroom. [online] Gallup.com.
Available at: http://www.gallup.com/businessjournal/23149/james-bond-comes-
boardroom.aspx [Accessed 8 Jun. 2017].
http://www.accaglobal.com, A. (2017). The role of marketing | F1 Accountant in
Business | ACCA Qualification | Students | ACCA Global. [online]
Accaglobal.com. Available at: http://www.accaglobal.com/gb/en/student/exam-
support-resources/fundamentals-exams-study-resources/f1/technical-articles/
the-role-of-marketing.html [Accessed 3 Jun. 2017].

Kotler, P., Armstrong, G. and Parment, A. (n,d.) Principles of marketing. London.
MarketWatch. (2017). 7 companies hurt by bad publicity. [online] Available at:
http://www.marketwatch.com/story/7-companies-hurt-by-bad-publicity-2014-08-
18 [Accessed: 11 Jul. 2017].
Moorman, C. and Rust, R. (1999). The Role of Marketing. Journal of
Marketing, special issue, 63(1999).
Narver, John C. and Stanley F. Slater (1990), “The Effect of a Market Orientation on
Business Profitability,” Journal of Marketing, 54 (October), 20–35.
Smallbusiness.chron.com. (2017). Duties of a Marketing Manager. [online]. Available
at: http://smallbusiness.chron.com/duties-marketing-manager-801.html
[Accessed: 10 Jun. 2017].
Thompson, Arthur A., Jr. and A.J. Strickland III (1983), Strategy Formulation and
Implementation. Plano, TX: Business Publications, Inc.
Workman, John P., Jr., Christian Homburg, and Kjell Gruner (1998), “Marketing
Organization: An Integrative Framework of Dimensions and Determinants,” Journal of
Marketing, 62 (July), 21–41
www.globalintelligence.com (2010). How to Develop a World Class Market
Intelligence Function. [image] Available at:
https://www.slideshare.net/GIAGroup/how-to-develop-a-world-class-market-
intelligence-function-slideshare [Accessed 11 Jul. 2017].

Part 2: Essay: O2
As the newly appointed Marketing Manager for your selected company.
The first objective you have been set is to research the competition and
produce a marketing plan based on your findings.
P3 Comparison between marketing mix elements
Product: Product is considered as important element which is sold by companies to their customers.
O2 is telecommunication provided in the UK which is owned by the Spanish multinational Telefonica.
It focuses on selling various types of products and services to their customers. The firm emphasises
on innovation so they introduce every year innovative mobile phone in the market.
On the other side Vodafone also carried out its business in telecommunication industry. The
firm use to differentiate its products from another competitor on the basis of unique features.
Price: Price is considered as important element which company need to consider for selling
products. There are various types of pricing strategies that can be followed by O2 companies for
selling products such as premium pricing strategy, skimming pricing strategy etc. O2 company can
consider premium pricing strategy for selling products and services. The products of O2 are unique
as no other competitor have so it can easily sale at premium price.
On the other side, Vodafone use skimming pricing strategy for selling products. As per this strategy
company kept price of its products lower then increase after sometime.
Place: Place is from where product can be sold to customers. It is important for the companies to
open its store at the place where people can easily visit and make purchase of their companies’
products and services. O2 has opened its store in different placed in UK which lead to make easier
for companies to sell. Along with this it also has online store.
One the other side Vodafone is operating its business at the large sector he also many stores in all
over the country and in other countries also.
Promotion: Promotional strategies used by O2 is different from its competitor it used to advertise
product on social networking sites. On the other side, Vodafone company sales its advertise its
product through making unique videos
Physical evidence: It is important that physical store of company should be attractive so that
customers feel satisfied. Interior design should be appropriate which can easily grab attention of
customers. O2 physical store is attractive enough in respect to grab attention of customers. On the
other side Vodafone use unique concept which help in looking its physical store attractive.
Process: A systematic process required to be followed so customers can received their products and
services on time. Therefore, company can use advance technology which can help them in
developing carrying out process in an effective manner. O2 company process is simple as because
they focus on fulfilling customer requirements on time. On the other side, Vodafone company use to
sale its product online also and focus on improving its process.
People: People within the firm are those who make innovative products and services for their
customers. O2 company’s employees are highly skilled and they focus on making innovative
products. On the other side, Vodafone company employees are not much skilled, therefore company
need to hire skilled employees.

P4 Marketing plan
Executive Summary
According to Ofcom (Figure 1), 94% of adults use a mobile phone, with 82.7 million
active mobile phone users in the UK, this is a dominant market. Therefore getting the
right marketing mix to deliver the right product to the customer is important for
increasing the market share and customer retention.
Fig. 1: Overview of key data: Mobiles, 2016 (Ofcom, 2017)
Company Overview
Telefonica purchased O2 in 2006 for £18 billion and holds a global presence across
the UK, America, Brazil, Germany, China and Spain. O2 is the brand name which
Telefonica is associated by in the UK. It is understood by Telefonica that, in the
current environment, mobile phones are considered as a major importance within the
daily life of its customers. Therefore, the name O2 is pertinent in that it compares its
importance to that of the presence of oxygen in life.

Fig. 2: (Telefonica.com, 2017)
Current marketing situation analysis
At O2 we consider EE to be one of our biggest rivals within the current market. The
overall business objective for both EE and O2 is to dominate the market of mobile
phone operators, by providing mobile products and services which meet the target
customers’ needs to the greatest degree.
EE is a private limited company and the largest mobile network operator within the
UK. Although they are ranked in joint 4th position of market share holders, they hold
both Orange and T-Mobile as subsidiaries and therefore together hold the largest
percentage (33%) of the market as seen in Figure 3 (Statista, 2017).
Market share held by mobile phone operators in the UK as of February 2013