User:Huangjennjia/7Cs COMPASS MODEL

At the time of booming economic, the marketing professionals are not likely to ask the question if their products can be sold out or not. As illustrated in the table below (3-2), purchasers are targeted by the producers for producing massive products. After that, prices of products are determined. In order to sell products successfully, producers manipulate promotions to persuade potential customers and display products at a right place simultaneously. Coordinating the strategy above with the factor of profile, it would lead to the result of increasing profits.

However, at the time of economic downturn, as indicated in the right table, companies and corporations produce the convenient commodities for consumers or citizens with consideration of a total marketing cost. Furthermore, through sufficient communications the consent would be obtained and the strategy of channel must be effectively executed. However, at this moment, every uncontrollable external factor would become more crucial. By practicing 7C mentioned above to gain confidences from consumers, it is a way to survive in the period of low growth economics.

Marketing activities are able to reflect a contemporary background. Hence, the words like managerial marketing, social marketing, ecological marketing and de-marketing appear. In the period of booming economics, the prefix of “pro” often occurs, such as Pro-marketing - to promote marketing activities, moving forward. On the contrary, for the low growth economics, it is replaced by the word of Com-marketing - to communicate and cooperate with the consumers, sometimes stopping or even moving backward to listen to their voices.

Framework of 7Cs Compass Model

1. Corporation and competitor

The core of 4Cs is corporation and organization, while the core of 4Ps is customers who are the targets for attacks or defenses. However, in the reality the real decision maker is corporations or organizations. Therefore, it can be explained that companies execute marketing activities and take the customers or citizens who surround with the companies as demand targets.

To avoid the misunderstanding, it is necessary to clarify the relationship between consumers and companies. Looking at the 7Cs compass model, it may be misunderstood that customers become less important and they are replaced with corporations or organizations as a new core of the model. In fact, the meaning is completely opposite - the consumers or customers play an even more important role. First of all, the company is surrounded with customers. Second, the company is the center to execute marketing activities. Third, the company focuses on the consumers instead of customers. In the market, great amount of companies conduct the same business. They are called as competitors. Their movements should not be ignored. Moreover, they are also functioning as individual systems in the 7Cs compass model. Hence, the core can be seen as multiple.

Why "Company" is put in the scope of 7Cs? Firstly, it is necessary to place more emphases on organizations of a company. Secondly, a marketing planning is set based on a company’s objective. Finally, it is necessary to tackle internal communication problems such as corporate communication or corporate identity system (CIS) or so on.

2. Consumer

Consumers are those people surrounding with companies. Unlike the market-oriented customers of the 4P marketing model, the consumers here are indicated as the ordinary citizens including potential customers who are cultivated by the motto of the consumerism.

Consumers are divided into two parts which are the perspective customers and the citizens who have social relationships with the companies. The former one is the target of marketing activities in the era of high-growth economics. It is out of questions that in the era of consumerism, they still need to be explored to increase the market share. On the other hand, although there is no direct sell-and-buy relationship with the latter one, companies nowadays can not neglect them. For example, companies produce noises and wastes in the process of production, which leads to a social problem. Since the word "Consumerism" was introduced in the 1960s, the companies so far still have ignored the relationship with the latter one.

The factors related to customers can be explained by the first character of four directions marked on the compass model: N = Needs, W = Wants, S = Security and E = Education.

a.Needs – to analyze what the consumer needs. Needs are unsubstantiated opinions, some of which cannot be converted to concrete commodities. Companies have to offer more alternatives to meet the various needs of consumers. b.Wants - the substantiated needs to expect the accordingly commodities. Companies need to pay more attentions on the consumers’ needs and should not neglect the noiseless ones. c.Security - the safety of commodities, the safety of the whole production process and the adequate after-sell warranty d.Education – consumers have rights to know the information of commodities.

3. Circumstances

In addition to the customer, there are various uncontrollable external environmental factors encircling the companies. Here it can also be explained by the first character of the four directions marked on the compass model - N = National and International, W=Weather, S = Social and Cultural, E = Economic.

a.National and International Circumstances The National Circumstances are related to politic and law. Once an election finished, the politicians in the parliament may be changed and the politicians who won the election may implement different policies. The most influential factor to marketing decisions is the economic policy, which directly affect the economic growth. There are also laws to protect consumers namely Consumer Contract Act, Consumer Protection Fundamental Act and Product Liability Act. Companies have no other choices but to follow these laws or they will face the endless lawsuits.

International environment now also becomes vital. In the very near future, no country is able to form an independent society. It is a must to establish the international cooperation mechanism for solving the problems like international law, energy, military, trade and so on.

b.Despite the advance of the human technology, the weather and natural environment are still uncontrollable. For most of natural disasters, the companies can do little but try to predict when disasters will happen and adjust their marketing plans. In addition, more can be done to avoid the disasters caused by human such as the environmental pollution. c.Social Circumstance is related to the social system and nations’ problems. When companies explore a new overseas market, it is essential to study and understand comprehensively the social circumstances of that nation. Moreover, a marketing analysis should encompass the following human cultural factors: 1) basic values and attitudes 2) motivation 3) learning capacity and achievement orientation 4) technical know-how 5) social discipline 6) sense of responsibility for the common good and the community 7) capacity for flexible adaptation to a changing environment

d.Economic Circumstances Economic Circumstances is closely related to the National Circumstances we have discussed before. However, economics climate is changing due to many uncontrollable factors such as energy, resources, international income and expense, financial circumstances, economic growth and so on. For example, the marketing structure of a company needs to be adjusted from 4Ps to 4Cs or 7Cs model when the economics is changed from high-growth to low-growth.

Source：Koichi Shimizu (2009) "Advertising Theory and Strategies,"16th edition, Souseisha Book Company. (Japanese) Koichi Shimizu (2003)"Symbiotic Marketing Strategy,"4th edition, Souseisha Book Company. .(Japanese) Professor Koichi Shimizu: Josai University Graduate School of Business Administration, Department of Business Administration (Japan)