Internal Marketing in Business Organizations

Internal Marketing

Article

Shiu, Y & Yu, T 2010, ‘Internal marketing, organizational culture, job satisfaction, and organizational performance in non-life insurance’, The Service Industries Journal, vol. 30, no. 6, pp. 792-809.

The requirement for Understanding the Article

The article mainly examines the impact of internal marketing on the insurance sector. For readers to understand the main points of the article, they must know the dynamics of the insurance sector, internal marketing, organizational performance, job satisfaction, and organizational culture, since they have significant correlations against each other. Internal marketing has a significant impact on internal marketing, organizational performance, job satisfaction, and organizational culture.

Abstract

The article has an abstract that gives a summary of the background information, methodology, findings, and implications. Harris (2006) states that an abstract should be a brief, but comprehensive information about the whole article. In the background, the abstract reiterates the importance of internal marketing in an organization. The methodology entails the empirical study of internal marketing in the non-life insurance industry. The findings show that correlations exist among internal marketing, organizational performance, job satisfaction, and organizational culture. Regarding implications, the findings require managers to employ internal marketing in promoting organizational performance, job satisfaction, and organizational culture in the non-life insurance sector. In this view, the abstract provides pertinent information about the study, which effectively summarizes the entire article.

Introduction

The article introduces the concepts of internal and external marketing by describing their essence in the service industry. Internal marketing targets employees within an organization, whereas external marketing targets consumers. Hence, the introduction explains the importance of internal marketing and external marketing in the service industry. However, internal marketing plays a central role in transforming an organization because it leverages organizational performance, job satisfaction, and organizational culture. Fundamentally, internal marketing dictates external marketing in the service industry. Therefore, the introduction leads readers to the heart of the study by describing the importance of internal marketing in the service industry.

Problem of statement

The problem statement of the article is that the insurance companies in Taiwan are facing stiff competition owing to the liberalization of the insurance sector by the government. In this view, insurance companies are undertaking major reforms to keep in tandem with the demands of the service industry and liberal regulations. As insurance companies deal with services, they need to provide quality, convenient, and customized services, which meet the diverse needs of customers. Thus, the examination of market orientation is integral in understanding consumer behavior in Taiwan and customizing services to fit their needs. Regarding liberal regulations, insurance companies need to enhance their competitiveness to overcome stiff competition from international insurance companies. In this view, the article indicates the problem statement as the increased competition due to the liberalization of the insurance market in Taiwan.

Objective of the study

The article has a clear objective, which elucidates the relationships between internal marketing and other variables such as organizational performance, job satisfaction, and organizational culture. Specifically, the objective of the study is to explore insurance companies in Taiwan with a view of elucidating the relationships that exist among internal marketing, organizational performance, job satisfaction, and organizational culture. As there are insufficient empirical findings that elucidate the relationship between these variables, this study undertakes an empirical investigation and offers evidence-based findings.

Literature Review

To form the basis of research, the article focused literature review on internal marketing, organizational performance, job satisfaction, and organizational culture. In the aspect of internal marketing, the literature review notes that employees are internal consumers, which marketing strategies should target to transform them into agents of external marketing in the service industry. Organizational performance is central in the assessment of insurance companies by examining financial and non-financial factors. In the service industry, job satisfaction promotes the performance of individual employees. Moreover, the literature review highlights that organizational culture reflects attitudes, norms, behaviors, and values, which drive employees in an organization. In the literature review, the authors argue that internal marketing, organizational performance, job satisfaction, and organizational performance have a positive correlation with each other.

Methodology

The study employs empiricism in exploring factors that influence the service industry in Taiwan. Essentially, the study created a conceptual model, which shows the relationships among internal marketing, organizational performance, job satisfaction, and organizational culture. Gilmore (2003) argues that the conceptual model is a very important element in research because they depict interactions of diverse variables in a given phenomenon of interest. The study surveyed seven top non-life insurance companies in Taiwan by administering questionnaires. The study used a five-point Likert scale, which effectively rated the level of responses. SPSS and LISREL are data analysis tools, which performed descriptive analysis and structural equation model analysis respectively.

Empirical Results

Descriptive analysis of participants in terms of age, gender, working experience, geographical region, and education offers appropriate demographic variables. In elucidating the nature of relationships that exist, the study shows that internal marketing, organizational performance, job satisfaction, and organizational culture have positive correlations against each other. Test of model fitness determined the validity and reliability of results. The hypothesis testing using correlation and chi-square enhanced the validity and reliability of the results. Overall, the results indicate that there are significant correlations among internal marketing, organizational performance, job satisfaction, and organizational culture. Therefore, the results have enhanced validity and reliability because of the quantitative analysis, which allows the determination of a significant level.

Conclusion

The article concludes by citing implications of the findings to the management of the non-life insurance companies in Taiwan. Since internal marketing determines the effectiveness of external marketing, the management should undertake extensive and intensive internal marketing to improve organizational performance, job satisfaction, and organizational culture. Therefore, the article offers an empirical solution to the challenges that service industries face in the competitive market in Taiwan.

References

Examination of the references shows that the article relied on recent books and journals as sources of evidence in backing up the arguments presented. Bilk (2007) states that recent articles, which are peer-reviewed journals, offer credible and reliable evidence. In this view, the nature of sources enhances the credibility of the findings that the study presents.

Internal Marketing

Article

Conradie, E, Lombard, M, & Klopper, H 2014, ‘Brand awareness in the services sector influenced by eight internal marketing elements’, Journal of Global Business and Technology, vol. 10, no. 1, pp. 25-37.

The requirements of understanding the article

The article entails research done to help South African car rental companies to upgrade their brand awareness. Specifically, the article focuses on the influence of internal marketing elements on brand awareness among consumers. In this case, readers need to understand the internal marketing strategies that improve brand awareness of the external world. Commonly the internal marketing procedures determine the way employees deliver their services to customers.

Abstract

The abstract of the article does not give a comprehensive overview of the main parts of the article. Essentially, the abstract does not meet the requirements of comprehensiveness because it does not summarize the methodology used (Harriss 2006). The abstract emphasizes the addition of the element of performance and the need to recognize employees’ roles in delivering the company’s services as a way of promoting successful brand awareness. Moreover, the article examines its purpose to enable the companies to expand customer bases, while retaining existing customers through upgrading the internal marketing programs.

Introduction

The introduction of the article explains why companies should target not only external customers but also focus on internal employees in achieving effective internal communication. This strategy of implementing brand awareness internally helps to achieve internal marketing. The introduction, therefore, gives a sufficient basis for the study by outlining the importance of internal marketing.

The problem of the Statement

The problem statement reveals the gap that exists in the literature. Fundamentally, there is no sufficient data on brand awareness, although there are internal programs in the companies. The relationship between the programs and the influence they have on brand awareness that exist among the customers is not definite. There is no research done to enlighten the companies if the eight internal marketing elements are effective in influencing brand awareness effectively. In this account, the problem is the poor performance of the internal marketing programs in enabling the success of brand awareness.

The objective of the study

The first objective of the article is to evaluate the association that exists between the eight elements of internal marketing and brand awareness. Furthermore, the article aims to ascertain an element that has the greatest influence on brand awareness. In this context, the research objectives are specific to the problem and the solution that car rental companies face.

Literature Review

The literature review forms the foundation of the research by outlining the existing data. The literature review focuses on internal marketing as a way of promoting customer satisfaction. If employees deliver proper services, they become powerful agents that effectively persuade customers, as they have an influential effect on marketing and brand development among consumers. The literature review emphasizes the necessity of the organizations to adopt the internal marketing mix elements that enhance brand awareness to external markets. The organization should ensure that its marketing strategies, programs, and policies match the internal marketing mix elements, which drive employees to deliver quality services to their customers. In light of this argument, the authors significantly emphasize the relationship between the employees, customers, and improved brand awareness.

Methodology

The study employed a conceptual framework, which relies on branding theories and marketing services. The conceptual framework elucidates the relationships that exist among the eight elements of marketing, namely, price, place, product, promotion, process, people, performance, and physical evidence. Three car rental companies provided the quantitative data, which reflect services that they offer in South Africa. Data analysis was done using structural equation modeling and the chi-square test. In this case, the methodology employed offers robust and valid data, which requires qualitative analysis.

Empirical Results

The study presents demographic attributes such as age, gender, and race, as well as outcomes of internal marketing and brand awareness. The results show that the traditional internal marketing elements, such as price, promotion, and place, have no significant impact on brand awareness. The eight elements of internal marketing have considerable influence on the routine operations and strategies of marketing. The finding illustrates that the eight internal marketing elements have a significant influence on brand recognition, loyalty, trustworthiness, and overall evaluation of employees. The use of hypothesis testing in the analysis of results enhances the reliability and validity of findings in empirical research (Taylor et al. 2012). Overall, the findings of the study are valid and reliable owing to hypothesis testing and their significance.

Conclusion

The article finalizes by outlining the importance of the empirical results to the car rental companies. The article recommends the development of robust internal marketing programs, which promote the satisfaction of employees and customers. The article concludes by citing the significance of creating brand awareness among customers. Employees have a significant influence on the attraction and retention of customers. Overall, the authors are objective because they give empirical implications of the findings on the service industry.

References

The authors use recent sources of data that include books and journals in supporting arguments and ideas in the journal. Belk (2007) asserts that the nature of sources determines the credibility, validity, and reliability of the findings. In this case, books and journals offer accurate and valid data, which reviewers have assessed and accepted their veracity.

Internal Marketing

Article

Matanda, M & Ndubisi, N 2013, ‘Internal marketing, internal branding, and organizational outcomes: The moderating role of perceived goal congruence’, Journal of Marketing Management, vol. 29, no. 9-10, pp. 1030-1055.

The Requirements of Understanding the Article

The main idea of the article is the role of internal branding and internal brand orientation on the successful congruence of the employees’ values and those of the organization. A reader needs to know what branding, internal branding, branding orientation, and the congruence of values in marketing. In summary, all these are linked to the satisfaction of employees and the success of the organization in retaining them.

Abstract

The abstract summarizes the role of the study, the hypotheses used in the study, the results, and the findings. In this case, the article is comprehensive and brief because it covers all aspects of the research (Harris 2006). The article investigates the role of internal branding and internal brand-orientation on the congruence between the employees’ goals and those of the organization. The study targeted employees, who offer customer-care and sales services because they interact constantly with customers in diverse chain stores in Australia. The results shows that internal marketing and brand enhance alignment of employees’ goals with organizational goals. Moreover, the results also state that retention of employees promotes internal marketing and orientation of customers within an organization.

Introduction

The article discusses the role of branding as a vital part of enhancing brand and organizational performance. Brand-oriented organizations need to adopt brand-supportive behavior to create a culture that is consistent with the brand identity and values. The employees, who make contact with the customers influence organizational performance and customer satisfaction. Thus, the article effectively depicts the importance of employees having values that are congruent with those of the brand and the organization.

The problem of the statement

The problem of the statement of the study is how to create a brand-supportive behavior among employees in an organization. Brand-supportive behavior ensures that employees’ values and goals match those of the organization. This shared understanding ought to create a brand-oriented culture that maintains the behavior of the employees. Therefore, the article has an explicit problem statement, which cites the incongruence between the organization and employees.

Objectives

The objective of the study is to look at the effects of brand orientation and internal branding on employee-related behaviors and attitudes. The study focuses on the effects of branding orientation, internal branding, and internal customer orientation. The performance of the brand and the organization are widely researched, but insufficient information is present to illuminate their effects on employees’ behavior and attitudes. Another objective in the article is to identify factors that contribute to the intentions of employees to stay in the organization and remain committed. Hence, the objectives of the article are very explicit and simple to understand.

Literature review

The literature review extensively borrows from the previous researches done on brand orientation, internal branding, and internal marketing. Organizations should do brand orientation to ensure that the brand’s values and those of the organization are instilled in the employees to ensure congruence of the message intended to reach customers. For internal branding to be effective within an organization, there should be effective communication among all employees or the designed brand building and consistency. As internal customers, employees have a considerable effect on the external customers’ reception and perception of the brand. Basing on the literature review, the authors have accurately developed nine hypotheses to test the objectives of the study.

Methodology

The study employs a conceptual framework, which outlines the relationships that exist among various factors of marketing, such as branding, perception of goals, intentions of employees, person-organization fit, and customer orientation. The study administered surveys to 520 respondents selected from a sampling frame of 960 employees, who work in customer care and sales in diverse companies in Australia. The study used psychometric approaches in the collection of qualitative data. However, qualitative data has a limitation because they do not allow hypothesis testing and determination of significant levels of findings (Taylor et al. 2012). Nevertheless, the methodology is very clear in that another researcher can reproduce and verify the results.

Empirical findings

The empirical findings of the study linked to the outcome variable show that internal branding and effective communication have significant positive effects on the intentions of employees. The goodness-of-fit statistics tested how the model fitted the data. Significant indirect effects in the model suggest the existence of mediation of the person-organization fit. Simple slope analyses were used to check any additional significant interactions. The analysis of data using diverse models and significant level gives valid and credible findings.

Conclusion

The authors conclude by giving empirical lessons, which marketing managers and human resource managers need to establish a brand-supportive behavior, enhance an internal customer orientation, and align the employees’ values with those of the organization. Moreover, the authors offer an empirical recommendation that internal customer orientation and internal communication should occur constantly to ensure the effectiveness of employees.

References

The authors have used diverse articles and books written by renowned authors in the field of marketing and management. Importantly, the authors obtained models from diverse works and customized them in the analysis of internal marketing; hence, promoting the validity of their research findings.

Review of Articles

Internal marketing concept and origin

The concept of internal marketing is very important in an organization because it determines the motivation of employees, defines the nature of services, and determines the satisfaction of customers. Organizations employ the concept of internal marketing in motivating employees and improving their performance with a view of producing quality products, which satisfy the diverse needs of customers. Matanda and Ndubisi (2013) describe internal marketing as a management tool, which is applicable in orienting employees to organizational goals and customer needs. In this case, internal marketing acts as a tool for managing both employees and customers. Finney and Scherrebeck-Hansen (2010) regard internal marketing as a management tool, which organizations use in increasing the effectiveness and efficiency of employees and operations. In essence, organizations employ internal marketing in effecting robust changes. In the realm of marketing, internal marketing has become a powerful tool for establishing and building competitive brands (Conradie, Lombard, & Klopper 2014). Therefore, the concept of internal marketing is central in the management of employees, provision of services, the transformation of organizations, and marketing.

The concept of internal marketing came into existence more than three decades ago. The concept originated as a technique of improving services, which organizations offer to their respective customers. According to Shiu and Yu (2010), internal marketing originated as a marketing concept that perceives employees as internal customers, who require motivation and satisfaction to perform optimally. However, the concept has evolved over the decades and has become a powerful tool, which organizations employ in the management and marketing aspects. Finney and Scherrebeck-Hansen (2010) argue that internal marketing enables an organization to manage its employees by orienting them to organizational culture, goals, and objectives. Currently, organizations use internal marketing as a competitive strategy for managing human resources, increasing organizational performance, and satisfying customer need.

Characteristics of good internal marketing

Internal marketing has evolved over the decades and has acquired numerous characteristics. According to Shiu and Yu (2010), internal marketing has five main characteristics, namely, perceives employees as internal customers, orients employees to customers, promotes human resource management, streamlines internal exchange, and acts as a tool of strategic management. The perception of employees as internal customers is a characteristic of internal marketing that recognizes the role of employees in marketing. For employees to perform optimally, they must have motivation and satisfaction in their respective duties and positions. Demotivated and unsatisfied employees perform poorly because they have no interest or passion in performing their duties. The orientation of employees to customers is a characteristic of internal marketing that allows organizations to improve customer satisfaction. Given that employees are internal customers, their orientation to external customers promotes marketing strategies. Fundamentally, internal customer orientation enables organizations to impart values, behaviors, and attitudes to employees, which promote congruence between internal and external customers (Matanda & Ndubisi 2013). Thus, customer orientation is a significant characteristic of internal marketing that defines marketing strategies.

The promotion of human resource management is characteristic of internal marketing that plays a central role in the improvement of organizational performance. The management of human resources entails recruitment, training, motivation, mobilization, and promotion, internal marketing provides a robust framework. Shiu and Yu (2010) state that internal marketing optimizes the abilities of employees and consequently improves organizational performance. As the internal exchange is an important characteristic that determines the performance of employees, internal marketing effectively promotes them. Essentially, internal marketing streamlines exchange between employees and the organization. Normally, organizations that perform efficiently achieve their goals and objectives because they have congruent relationships between the management and employees. Ultimately, strategic management is an integral characteristic of internal marketing because it defines marketing and management approaches. Marketing programs are dependent on internal marketing strategies that organizations employ (Conradie, Lombard, & Klopper 2014). Thus, to boost sales and expand market share, marketers normally employ internal marketing in the formulation, implementation, and management of marketing strategies.

Factors or variables that constitute internal marketing

Since its emergence three decades ago, internal marketing has acquired different factors or variables that define it. Conradie, Lombard, and Klopper (2014) state that price, place, product, promotion, process, people, performance, and physical evidence are eight factors that constitute internal marketing. Conventional market mix elements, namely, place, product, price, and promotion, are the major pillars that support marketing strategies. As internal customers, employees consider price, place, product, and promotion when looking for jobs, performing their duties, and marketing products. The intention of employees to stay in an organization is subject to internal marketing and congruence with organizational values, goals, and objectives (Matanda & Ndubisi 2013). Conventional marketing mix constitutes integral factors of internal marketing.

Process, people, performance, and physical evidence are additional factors of internal marketing in an organization. The process is a factor that defines how organizations deliver services to customers with a view of satisfying their unique needs. The establishment, development, and protection of brands constitute the process that organizations use in marketing (Matanda & Ndubisi 2013). Fundamentally, the process comprises all activities aimed at improving services and customer satisfaction. As employees’ behaviors, values, and attitudes influence external marketing, motivation and satisfaction are necessary to boost their performance. Physical evidence is a factor that has an overwhelming effect on marketing, especially internal marketing. According to Conradie, Lombard, and Klopper (2014), the layout of service settings, the appearance of products, signage, and visual adverts are integral elements of internal marketing. In essence, employees and customers require physical evidence for them to remain loyal to specific brands or organizations.

References

Belk, K 2007, Handbook of Qualitative Research Methods in Marketing, Edward Elgar Publisher, London.

Conradie, E, Lombard, M, & Klopper, H 2014, ‘Brand awareness in the services sector influenced by eight internal marketing elements’, Journal of Global Business and Technology, vol. 10, no. 1, pp. 25-37.

Finney, S & Scherrebeck-Hansen, M 2010, ‘Internal marketing as a change management tool: A case study in re-branding’, Journal of Marketing Communications, vol. 16, no. 5, pp. 325-344.

Gilmore, A 2003, Services Marketing and Management, SAGE Publisher, New York.

Harris, M 2006, ‘Three steps to teaching abstract and critique writing’, International Journal of Teaching and Learning in Higher Education, vol. 17, no. 2, 136-146.

Matanda, M & Ndubisi, N 2013, ‘Internal marketing, internal branding, and organizational outcomes: The moderating role of perceived goal congruence’, Journal of Marketing Management, vol. 29, no. 9-10, pp. 1030-1055.

Shiu, Y & Yu, T 2010, ‘Internal marketing, organizational culture, job satisfaction, and organizational performance in non-life insurance’, The Service Industries Journal, vol. 30, no. 6, pp. 792-809.

Taylor, S, Kim, M, Ishida, C & Mulligan, J 2012, ‘Augmenting null hypothesis significance testing in marketing research’, Journal of Management and Marketing Research, vol. 1, no. 1, pp. 1-26.