Internal Marketing - A Review


By

Dr.S.Praveen Kumar
Associate Professor
Panimalar Engineering College
Chennai

Dr.S.Durga Rao
Professor
S.V. University
Tirupati
 


It is commonly believed that the sole role of marketing is to sell products and services outwardly to customers. In fact, the first and most urgent job of marketing is often to sell inwardly toward a company's people. For, it is only when the people of the company fully understand and are committed to the value proposition of the organization and its brands that external marketing can reach its full potential.

Marketing and the marketing philosophy  came into prominence in the 1960's, yet it was not until the 1980's that it became widely accepted, practiced and seen by most organizations as indispensable. Similarly, participative management gained wide acceptance in the 1980s, and the 1990s saw the emergence of the strategic approach to HRM. The need to align human resources to the organizational strategy is widely accepted and, more recently, the need to focus organizational resources towards customer and market orientation has gained ground in the emergence of market-focused management.

These developments mean that conditions for the adoption of Internal Marketing are optimal. This can be seen in the growth of interest in Internal Marketing by managers and the rapid growth in the number of organizations adopting Internal Marketing management practices. This is because Internal Marketing tackles the issues and problems of implementing organizational strategies head on. This issue is neglected in most discussions of strategic management and marketing strategy. Numerous firms and organizations have discovered to their cost that formulation of brilliant strategies is next to useless without effective implementation.

The term internal marketing appears to have been first used by Berry et al., then later by George, Thompson et al and Murray. Even though the term internal marketing was not directly used by them, the idea of internal marketing was also present in Sasser and Arbeit's 1976 article. However, it was not until the publication of Leonard Berry's 1981 seminal article in which he defined internal marketing as 'viewing employees as internal customers, viewing jobs as internal products that satisfy the needs and wants of these internal customers while addressing the objectives of the organization' that the term entered popular management discourse.

The concept of Internal Marketing has evolved and the following definition was proposed by Rafiq and Ahmed:

'Internal marketing is a planned effort using a marketing-like approach directed at motivating employees, for implementing and integrating organizational strategies towards customer orientation'.

An in-depth review of literature done on Internal Marketing throws light on the concept and highlights certain startling revelations.

The purpose of the empirical paper by Ian N. Lings, Gordon E. Greenley, (2010)1 was to investigate internal marketing from a behavioural perspective. The impact of internal marketing behaviours, operationalised as an Internal Market Orientation (IMO), on employees' marketing and other In-Role Behaviours (IRB) were examined. The findings of Spiros Gounaris, Aikaterini Vassilikopoulou, Kalliopi C. Chatzipanagiotou, (2010)2show that Market Orientation (MO) and  Internal Market Orientation (IMO) are two inter-related concepts, probably falling under the marketing philosophy umbrella. Through MO adoption, customer perceived value and customer perceived quality of the service increases.

The result of the study done by P. Raj Devasagayam, Cheryl L. Buff, Timothy W. Aurand, Kimberly M. Judson, (2010) 3 lends strong support to the need for and efficacy of internal brand communities, and provide an opportunity to examine the strategic synergies of pursuing such a strategy for internal as well as external audiences. Further, implementing an internal brand community can lead to increases in the emotional buy-in of employees and ultimately could help companies increase the proportion of "champion" employees.

From Hua Yang, Nigel Coates, (2010) 4study it has been accepted that enhancing the satisfaction of employees, especially customer-contact employees is important as they can significantly and positively influence customers' satisfaction. The study done by George G. Panigyrakis, Prokopis K. Theodoridis, (2009) 5 reveals that even if the concept of IM is partially exploited, the respective organisational behaviours clearly have a positive impact on both financial and non-financial aspects of retail performance, thus revealing their importance.

The results of the study done by Vicent Tortosa, Miguel A. Moliner, Javier Sαnchez, (2009) 6 shows that employee orientation or internal market orientation, through the dimension informal generation of information, influences the satisfaction of contact personnel, the quality of service perceived by the customer and, through the latter, and the customer's satisfaction. It also corroborates the influence exerted by the contact personnel's satisfaction on the perception of quality and on the satisfaction of the customer receiving the service.

The paper of Nancy Bouranta, Leonidas Chitiris, John Paravantis, (2009) 7 provided an experimental evidence supporting the view that internal service quality has a direct effect on external service quality. Anselmo Ferreira Vasconcelos, (2008) 8 broadened the Internal Marketing Concept role through incorporation of Happiness in the Workplace (HWP) construct. Given that happiness in life is a goal that everyone pursues, and HWP is one of its dimensions, it was suggested that firms could employ it as a strategy to maintain and motivate their best assets (i.e. their employees). Fundamentally, the same principles which are used to market solutions to the organisation's external customers can be employed to better segment, target and position the internal customer base and these issues are explored by Robert E. Morgan (2004) 9

Alexandros Paraskevas (2001)10
found that interpersonal relations affect to a great extent all internal service encounters. Tim R.V. Davis (2001) 11 opines that Internal marketing has been proposed as a way of increasing lower level commitment to corporate strategies and improving organizational integration. Marelise Pitt, Johan Bruwer, Deon Nel, Paul Berthon (1999) 12argue that if poor service is provided between employees it is unlikely that good service will ultimately be provided to the external customer.

Gould, B (1998) 13concludes that many businesses should give serious consideration to the idea that HR and marketing should be combined. Adrian Sargeant, Saadia Asif (1998) 14opine that there is at present little understanding of the needs of employees, and internal market research is noticeably absent. The results reveal a clear need for both institutions to adopt a more strategic perspective on their internal marketing activity. Dwayne D. Gremler, Mary Jo Bitner, Kenneth R. Evans, (1995) 15indicate that internal customers are similar to external customers in that, with a few interesting differences, the same types of events and behaviours distinguish satisfactory and dissatisfactory incidents in both internal and external encounters.The need to market internally the plans and strategies developed by marketing managers is seen as a critical component of successful plan introduction. Internal Marketing appears to be a critical issue in making marketing work according to Nigel Piercy, Neil Morgan (1991) 16

All the reviews point to the fact that future research could measure the attitudes and behaviours of the management, employees and customers directly and explore the relationships between them.

References:

1.. Ian N. Lings, Gordon E. Greenley, (2010) "Internal market orientation and market-oriented behaviours", Journal of Service Management, Vol. 21 Iss: 3, pp.321 – 322.

2. Spiros Gounaris, Aikaterini Vassilikopoulou, Kalliopi C. Chatzipanagiotou, (2010) "Internal-market orientation: a misconceived aspect of marketing theory", European Journal of Marketing, Vol. 44 Iss: 11/12, pp.1667 – 1699.

3. P. Raj Devasagayam, Cheryl L. Buff, Timothy W. Aurand, Kimberly M. Judson, (2010) "Building brand community membership within organizations: a viable internal branding alternative?", Journal of Product & Brand Management , Vol. 19 Iss: 3, pp.210 – 211.

4. Hua Yang, Nigel Coates, (2010) "Internal marketing: service quality in leisure services", Marketing Intelligence & Planning, Vol. 28 Iss: 6, pp.754 – 760.

5. George G. Panigyrakis, Prokopis K. Theodoridis, (2009) "Internal marketing impact on business performance in a retail context", International Journal of Retail & Distribution Management, Vol. 37 Iss: 7, pp.600 – 628.

6. Vicent Tortosa, Miguel A. Moliner, Javier Sαnchez, (2009) "Internal market orientation and its influence on organisational performance", European Journal of Marketing , Vol. 43 Iss: 11/12, pp.1435 – 1456

7. Nancy Bouranta, Leonidas Chitiris, John Paravantis, (2009) "The relationship between internal and external service quality", International Journal of Contemporary Hospitality Management, Vol. 21 Iss: 3, pp.275 – 293

8. Anselmo Ferreira Vasconcelos, (2008) "Broadening even more the internal marketing concept", European Journal of Marketing, Vol. 42 Iss: 11/12, pp.1246 – 1264

9. Robert E. Morgan, (2004) "Business agility and internal marketing", European Business Review, Vol. 16 Iss: 5, pp.464 – 472

10. Alexandros Paraskevas, (2001) "Internal service encounters in hotels: an empirical study", International Journal of Contemporary Hospitality Management, Vol. 13 Iss: 6, pp.285 – 292

11. Tim R.V. Davis, (2001) "Integrating internal marketing with participative management", Management Decision, Vol. 39 Iss: 2, pp.121 – 132.

12. Marelise Pitt, Johan Bruwer, Deon Nel, Paul Berthon, (1999) "A framework for research in internal marketing and the study of service quality: some propositions", Management Research News, Vol. 22 Iss: 7, pp.1 – 11

13. Gould, B, (1998) "Emotional capital and internal marketing", Antidote, The, Vol. 3 Iss: 8, pp.34 – 37

14. Adrian Sargeant, Saadia Asif, (1998) "The strategic application of internal marketing - an investigation of UK banking", International Journal of Bank Marketing, Vol. 16 Iss: 2, pp.66 – 79

15. Dwayne D. Gremler, Mary Jo Bitner, Kenneth R. Evans, (1995) "The internal service encounter", Logistics Information Management, Vol. 8 Iss: 4, pp.28 – 34

16. Nigel Piercy, Neil Morgan, (1991) "Internal Marketing: Making Marketing Happen", Marketing Intelligence & Planning, Vol. 8 Iss: 1, pp.4 – 6.
 


Dr.S.Praveen Kumar
Associate Professor
Panimalar Engineering College
Chennai

Dr.S.Durga Rao
Professor
S.V. University
Tirupati
 

Source: E-mail December 22, 2011

          

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