Public Marketing

Public
Marketing
COURSE HANDBOOK
& WORKSHOP EXERCISES
Adriana GRIGORESCU, PhD. Professor

Amalia-Elena ION, PhD. Student
Chapter 1 – Introduction to Public Marketing
◦ Assignment – CASE STUDY
Chapter 2 – Marketing in the public sector

Course Summary ◦ Assignments – Food for thought
Chapter 3 – Public Sector Performance

◦ Assignment – CASE STUDY + Food for thought
Chapter 4 – Public Marketing in Action

◦ Assignment – CASE STUDY + Food for thought
PUBLIC MARKETING HANDBOOK - NATIONAL SCHOOL OF POLITICAL AND ADMINISTRATIVE STUDIES SNSPA -
2
2020
Chapter 1 – Introduction to Public
Marketing
What is marketing?
The management process for identifying,

anticipating and satisfying customer
requirements profitably.
It is also about establishing relationships to

satisfy individual or organizational
objectives.
So, how does it qualify for the public

sector?
PUBLIC MARKETING HANDBOOK - NATIONAL SCHOOL OF POLITICAL AND ADMINISTRATIVE STUDIES SNSPA - 2020 3
Marketing and the Public Sector
Within the public sector, there is little to no competition
The customer satisfaction is the main scope, although frequently there is no direct or indirect
form of competition
The public sector is a monopoly in terms of supply, but that does not represent a premise for the
lack of marketing
In the context of public organizations, marketing has to play a broader role – it has to satisfy the
needs of different conflicting interests
Instead of CUSTOMERS, the public sector has STAKEHOLDERS
A better definition of marketing…
For the scope of the public sector, we can
interpret the context of marketing as follows:
Marketing is the management process
responsible for identifying, anticipating and
satisfying stakeholder requirements and in
doing so serves to facilitate the achievement
of the organization’s objectives.
The public sector organization works toward
developing ideas, benefits and values about
products and services it has to offer to the
stakeholders.
Public Marketing and Communications
Communication allows for effective conduct of marketing operations
Types of communication within an organization: management (messages conveyed by

management to internal and external stakeholders), marketing (directly aimed at the customers)
and organizational (public relations, public affairs, environmental communications, investor
relations, internal communication).
Nevertheless, PERSUASIVE communications involve MARKETING
Public marketing offers mainly services to its stakeholders => marketing of services
Public Marketing – a service based sector
Services have intangible attributes, therefore Some marketing techniques used within the public
requiring special understanding and special sector fall under the scope of social marketing –
marketing efforts promoting ideas
The personnel providing a public service is as Kotler and Zaltman offered a definition of social
important as the service itself marketing:
The relationship between the service provider and The design, implementation and control of
the service receiver is of paramount importance programmes calculated to influence the
acceptability of social ideas and involving
Service-based organizations are concerned with considerations of product, planning, pricing,
managing relations and interaction processes communication, distribution, and marketing
research.
The marketing in that sense revolves around
attracting, maintaining and improving Social marketing  specific behavioural goals for
customer/stakeholder relationships. social good
Value criterion and aim of marketing
Normally, within a business environment, the marketing strategy is conceived to generate
increased sales and/or to build market share  through superior customer value, superior
performance is achieved. So the focus shifted from profitability to delivering value to customers
The discussion is not that straightforward in the case of public sector:

◦ The possible existence of conflicting stakeholder interests
◦ The hierarchy of preferences within an organization
◦ The different organizational objectives
The public sector mostly ‘sells’ policies to its citizens – and the interests of all stakeholders
(internal and external) are not mainstreamed
Public organizations and their types of
marketing
Marketization – some public sector
activities become commercialized – to bring
down the market price and up the standard
of quality
Using marketing for promoting self-interest

– securing the existence of public sector
through the support of market and society
City marketing
Promoting key political objectives
Marketing strategy for the public sector
With the aid of a marketing strategy, the public sector will be able to purposely target their audiences, setting
priorities, providing residents with efficient services  through the information and data gathered by market
research
Consequently, the emphasis will be put on the end user of the public services, rather than on the service itself
Nevertheless, the public sector might face some difficulties imposed by lack of resources (financial, physical) and
by the limitative regulations and legislation
Moreover, the marketing strategy is marked by the philosophy ‘the customer is always right’, which in the public
sector does not always apply. The stakeholder might be also wrong! So it is important to adopt the most
professional practice, regardless of the stakeholder agreeing or not with it.
At the same time, many public organizations also provide restrictive or coercive services – underlining that the
survival of a public entity does not rely on its service users, but on the support of the legislation, government or
policies.
What is a public sector organization?
1. a monopoly provider – the stakeholder
will have to accept the service even if it
does not abide to his standards
2. a free service provider – the stakeholder

will have to accept the basic, free service in
case it does not have the necessary
resources to pay for an alternative service
3. a permanent service provider
The marketing mix
Any marketing effort is accompanied by a 4Ps = Product + Price + Place + Promotion
strategy that employs the usage of the
4Cs = Customer needs + Costs of customer
marketing mix.
+ Convenience + Communication
A successful marketing mix will be based on
the efficient and effective combination of Among other approaches, there are also
all variables within, and realizing the scope versions of the marketing mix including
or the objectives of the organization. additional Ps as follows:
7Ps = Product + Price + Place + Promotion +
There are two approaches to the marketing
People + Physical evidence + Process
mix – the organization-oriented approach,
and the customer-oriented approach.
The 7Ps marketing mix of the public sector
Product People Promotion Place Price Physical Processes
evidence
Marketing mix Quality Service Advertising, Distribution Listed price, Information, Information,
for the private standards, delivery selling, channels, discounts, components people,
sector features, Behaviour promotions, coverage, payment for mechanisms
options, style, Attitudes, publicity, location, period, credit performance for delivery,
branding, etc. interactions public availability in policies,
relations communicatio procedures
n
Marketing mix Service Stakeholders Vision, values, The Financial Prospectus Surveys
for the public Features, culture organization management, Website, Evaluation of
sector location, Branding, Opening time, tendering newsletters, surveys,
design, design of location contracts organization’s complaints
branding literature, facilities and procedures,
leaflets, buildings quality
letterheads management,
open door
policy
The best way to offer value to user
SHAPE THE NATURE OF ITS SERVICES DISTINGUISHING CHARACTERISTICS EFFICIENT MANAGEMENT THROUGH
TO THE NEEDS OF THE STAKEHOLDERS OF CLIENT-ORIENTED APPROACH DIFFERENT MARKETING STRATEGIES
Creating value for stakeholders
MARKET SEGMENTATION POSITIONING SERVICES
Begins with the gathering of data on the The services are positioned in the minds of
stakeholders, and the analysis of their the stakeholders making the former
interests and needs attractive for the latter – using the
Grouping people in market segments who marketing mix
share common characteristics  tailoring
services to fit their particular needs Consistent message and image of service =
service value for stakeholders
Best practice for efficient deployment of
resources
Wind of change in public marketing
The government legislation has suffered
alterations in the last decades, and it has
created a rather new wave of disturbances
in the overall public sector, including the
introduction of competitive practices.
The public sector is now expected to

respond to the new competitive culture, by
departing from the established role of
social services providers, and going toward
a market-led orientation.
Food for thought…
Reasoning Exercise
In setting policies and making decisions it is not always possible to reconcile different interests,
and when trying to do so, marketing is bound to fail.
What evidence would you advance to support this argument, and what evidence would you
advance to differ it?
Case Study – Riverside Ambulance Services
The primary functions of the organization are to deliver an emergency medical service within the pre-
hospital environment and to provide transport provision for clients to hospital outpatients and day
units. The secondary functions of the service are aimed at income generation and include:
- delivery of health and safety at work first aid training to external bodies;
- provision of medical cover at organized public events;
- collection of medical waste GP surgeries and dental practices.
Very limited marketing is conducted by the organization and it is mostly reactive to situations, with a
press officer dealing with media issues. The organization attends career evenings in schools
occasionally, though this area has no clear direction or strategy. Other activities include school visits
with the other emergency services to emphasise safety.
Case Study – Riverside Ambulance Services
◦ Problem identification: The organization feels that it does not market what it does. The public on the
whole is not aware of the level of pre-hospital care that can be delivered by the paramedics working for
Riverside Ambulance. Often the service is being called out to trivial issues, toothache being a prime
example, or a cut finger. By marketing the skill level of paramedics and technicians, raising public
awareness, it could change how the public views its services.
◦ The organization receives both letter of appreciation and complaints, but does not undertake any
customer satisfaction studies. It is exploring alternative care pathways for patients in conjunction with
other stakeholders and feels this could be an area to explore for marketing. The objective is to reduce
the volume of patients being taken into and emergency departments.
Questions:
1. Discuss how a role for marketing might be develop within the organization.
2. Compile a marketing mix for the organization, and state which areas you consider fundamental for the
public marketing strategy of the organization.
Chapter II – Marketing in the public sector
The public sector is a market place by its own
Nevertheless, the traditional market forces of supply and demand do not always apply to it
The beneficiary or purchaser of the public services is not always the end user
This means that marketing public sector services will be more complex and would require, most
of the time, a different approach than that used in the private sector
Marketing gained in the last decades more ground, and as governments face budget restrictions,
the marketing of public services demands value for all money spent
Moreover, the monopoly of the public services started slowly to be challenged by private
entities and ONGs
User involvement in the service provision
There has been a growth in the emphasis Usually, the way in which services are
placed on the involvement of the end user in delivered takes the central role, forgetting
the development of the service provision what the stakeholders need and want
Complementary, the organizations operating The organization focuses on the effectiveness
in the public sector directed their attention to and efficiency of the service provision, while
the maximization of value creation and quality the stakeholder adapts to the service on offer
services, and staying on top of budgets
Examples of such public services include:
The effectiveness of marketing techniques is
measured by its relevance to the goal - public health, public education services, and
achievement – meeting the needs of even public safety services
stakeholders
The sales of public services
Normally, the way in which the delivery of services functions from the perspective of marketing
follows the next pattern: Service  Sales  Customers
During the public services provision, the sales part of the equation is erased
The relationship between the stakeholders and public services suppliers does not involve the
direct exchange of money or any money equivalent
And that is because most of the public services are financed by taxation (e.g. health
organizations, local authorities, police department, etc.)
The stakeholder led approach
In this case, the service is not developed Nevertheless, there are some constraints to
until proper and complete information on implementing such an approach:
the stakeholder is gathered, compiled and
- legislative restrictions
analysed
- political philosophies
The emphasis is placed on what the
stakeholder needs and wants - lack of physical resources
The organization will provide, therefore, an - lack of financial resources
endlessly changing service to meet all the
needs of its stakeholders
How to cope with that?
In the market economy, the customers of a service are purchasers, and their evaluation and
perspective on the quality of the delivered service will alter the latter, transforming in gradually
in a better experience, but at the same time also in a more expensive service
In the case of public services, the funds are collected indirectly from the stakeholders, but they
do not have an influence on the quality of the service
Moreover, the decision making process within the public organization is chaired by an appointed
or elected representative. The latter decides which services will satisfy the needs of the majority
of stakeholders
Ultimately, the representative and its team should always involve the stakeholders into the
development and implementation of the public services
Identifying stakeholder needs
The most practical way to identify stakeholder There are two types of research – primary
needs is to undertake research (involving the collection and analysis of new data),
and secondary (involving information already
By identifying what stakeholders require, the available)
organization will be able to establish a long term
plan, and a general direction for the future In order to understand which type of research is the
best option for the given institution, there should
In order to identify the stakeholder needs and be some factors to consider:
requirements from the public services, the ◦ - purpose of research
organization must follow the stages of research: ◦ - nature of target audience
research objectives, information required, research
◦ - importance of sample size
methods, research plan, collection of information,
analysis and evaluation of data ◦ - type of information required
◦ - timescale for research
◦ - resources available
Anticipating the needs of stakeholders
Among the difficult tasks of marketing is the anticipation of the future stakeholder’s needs
This is key to the success of the long-term organization’s service provision
For instance, anticipating the future needs of the older groups of stakeholders for their living
conditions and well-being will determine level of life quality life and longevity
Among the services impacted by such a needs’ anticipation could be mentioned: social services,
transport, health care, housing, etc.
The planning for these types of public services must start in the present time for the future
generations – due to the constant changes in the economy, in the social and technological world,
and in the requirements of the stakeholders
Coping with future demands
To effectively cope with future demands of
stakeholders, we understood that it is
important to do research on their needs, to
plan ahead, and to anticipate the changes
within the market.
The public organizations have to face
changes in their current operations,
including the introduction of new
technologies, and the development of new
products and services, as some will become
redundant.
Meet the stakeholder’s needs
To achieve stakeholder’s satisfaction, the organization prompting the public services must have
all the needed information in order to develop a certain level/standard of service quality
The benefits of meeting stakeholder’s needs are: reductions in complaints, spread of advocates,
reduction in costs, development of loyal stakeholder base, higher staff morale.
In order to assess the level of satisfaction of stakeholders, the public sector can undertake
research activities that can make the difference in the development of future plans for the
service realization, as well as for the overall perception on the service quality and performance.
Sometimes, the difference lays in small, simple things – for instance, the clean, tidy waiting
room of a public clinic will have a positive impact on the health service provided by the given
organization
What are the market conditions?
It is clear by now that the intervention of If research was undertaken in order to
the stakeholder’s input in the development understand the needs of the stakeholders,
of the public service will ensure the success and in the development of an effective and
of the latter. efficient public service, the former is also
used for gaining knowledge of the external
But the public sector must identify also the
environment and of identifying the market
conditions of the market place, especially
conditions within the field of service
since the market opened for private
offerings by both public and private sectors.
enterprises and non-profit organizations to
provide more or less the same services as The main aspect: the service delivered must
the public institutions. meet stakeholder requirements, be
competitive and in line with future trends,
The 3 pillars of the marketplace
Stakeholders Competitors Market trends

• What are their wants and needs in • How do they develop their service? • PEST analysis
the present and in the future? • Do they implement innovative ideas?
Public vs. Private
The private sector sells its services to the customers, and the latter will decide which provider
will deliver them a certain service.
In the public sector, there is usually an institution that would deal with a certain type of service
provision, and the exchange of services to the stakeholders will not imply the transfer of money.
But the initiatives of the public sector are to be made knowledgeable to the stakeholders by
means of marketing. The stakeholders will be convinced through marketing techniques of the
standards and quality of public services, and their ability/capacity to meet the requirements.
This case does not apply in Romania, but there are public services offered in other countries that
might require the stakeholder to change his status into a client or customer and actually pay for
that given service.
Conclusively…
The marketing oriented organization will Being open to understanding what are the
find out first what are the needs of the requirements of stakeholders will allow the
stakeholders before developing the service public sector to be able to plan long term
and to efficiently project and budget
Ideally, any public institution should aim to
implement stakeholder led approaches Anticipating what stakeholder will want is
the only way of remaining competitive on
Marketing will become the link between the long run
the institution and the stakeholder – it will
allow for the development of a relationship The stakeholder satisfaction will be realized
through qualitative service offering and
state-of-the-art marketing initiatives
Food for thought…
PROBLEM IDENTIFICATION QUESTIONS
Think about a certain public service that 1. What were the stakeholder needs you have
identified in relation to the provided service? Were
you are receiving and/or you have received there any requirements that you feel have not been
in the past. met? If yes, list them out.
2. Comparing the public services (within the prior
Inspiration: This can be even one of the selected field) you have received over a certain period
of time, please assess the measure in which the
education services you have been a stakeholder’s needs have been anticipated.
stakeholder in.
3. Conclusively, does the given public service manage
to satisfy the requirements and needs of stakeholders?
Please state your own opinions 
Public marketing mix
To optimize the marketing process, any organization will try to effectively harmonize the
elements of the marketing mix. This will have a positive impact from the perspective of costs, as
well as for the increased performance of the organization, and the achievements and objectives
realization.
Public sector organizations will employ the use of effective marketing mix in order to maximize
the service quality. The marketing mix will be constructed based on the identification of the
following elements: assessment of needs and desires of stakeholder, implementation of high
quality and cost-effectiveness within the service planning, and realization of the right service
(Product); tender pricing (Price); promotion of service to stakeholders (Promotion); launching
method to access the service (Place).
Changes?
The marketing mix can suffer changes as the The public sector might employ another
results from the stakeholder satisfaction element in the marketing mix – People.
feedback research showcase weaknesses.
This 5th P is representative of the
The improvements will manage to eliminate organization’s personnel, an element on the
all the activities and inputs that do not supply chain that proved to be of paramount
produce the estimated rewards or results. importance in the execution and delivery of
the service, and for the overall quality level of
Therefore, this step of changing the marketing
the service provided.
mix in response to the position of the
institution on the market will become
significant.
The Service
In the realization of the public service, the
organization will follow some consideration:
- stakeholder benefits
- quality level
- inputs to the service
- support services
- client satisfaction feedback system
PLC and the public sector
The Product Life Cycle concept is widely used as a marketing tool within the private sector.
But it is also useful in the development of public services, especially if those services are
delivered by private sector companies (e.g. prisons, housing, health care).
PLC is adapted for the public sector by comparing the service development over time with the
total expenditure rather than sales. The stages of the PLC for the public services are the
following: initial pilot project (a new service is developed slowly), growth period (the demand
for the service increases alongside the expenditure), maximization (the maximum expenditure
level is reached for the supply of the service), stagnation (no more funds are available for further
development of service), decline (downsized, replaced or outsourced service).
Access to the public service
The accessibility of the public service to its
stakeholders is to be continuously monitored,
in order to remain relevant for the certain
delivery period.
Beyond ensuring physical access to the
service, and information regarding the
service, the public sector must consider the
expectations of stakeholders, the correct
image of the service and institution, the
outsourcing of certain elements of the
service, the transportation, the online access,
and even the style of written material.
‘Pricing’ of public services
Even though the public services are indirectly
free, they do imply the usage of funds and
budgets in order to be developed,
implemented and controlled.
When assessing the pricing of services, any
organization must consider the costs of
developing and implementing the service, the
credit and payment terms, the external
factors (legislation, market environment,
technology, etc.), the competitors (from the
private sector), the supply and demand for
the service, the expectations of stakeholders.
Awareness toward public services
The stakeholders of public services must
have access to information regarding the
characteristics and the provision of the
service.
The promotional techniques include the
usage and facilitate access to:
- website, advertising material (brochures,
newsletters), social networking, notice
boards, media, WoM, conferences, PR,
press relations, etc.
Food for thought…
PROBLEM IDENTIFICATION EXERCISE
Lets select any public service that you have 1. Make a table with the 5Ps of the public
received or identifies lately. marketing mix – product/service, price,
place, promotion, people.
Inspiration: This can be even one of the
education services you have been a 2. Compile in that table concepts,
techniques, strategies for each grid of the
stakeholder in.
marketing mix for the selected public
Please state your own opinions  service. Make sure you cater to the
stakeholder led approach.
Chapter III. Public Sector Performance
UTOPIA = both interests of citizens/stakeholders and public sector agencies, organizations,
institutions are served!
EXAMPLE: There was recently announced the implementation of a new school programme
called ‘Walking School Bus Programme’. This is an initiative to induce constructive behaviours in
children, by incentivizing them to walk from their houses to school (if they live in the proximity).
The main scope of the project is to allow children to spend some time outside, and to learn how
to stay active each day of the week. If the project will be successful (if it caters to the needs of
the stakeholders, and if the latter will provide good feedback to the movement), the district’s
transportation costs will drop and the general behaviour of children toward physical activity and
outdoor activities will increase, creating a situation that would provide benefits to both parties
involved.
Seize the opportunity
The former example was meant to showcase the situation in which the proactive initiative of the
governmental agency or local authority have managed to contribute to the social good, as well
as to the economic and environmental good as well.
This is the perspective in which the public sector will work on developing and implementing
quality programmes and projects, for which citizens have increased interest, and eventually will
produce higher revenues and satisfaction within the community.
The opportunity of shaping the inclinations and behaviours of stakeholders of the public service
lies in the ‘hand’ of the authorities. The overall public health and safety increases with the
voluntary compliance from the stakeholders, if the communication bridge is effective, and if the
public service improves the ambiance and even brings in some creative solutions.
Satisfaction = Performance
All the communities in our world function The reason why well-known public services
with the help of the public sector – the latter are managed by state is that by being
defines the operating principles of the natural monopolies those services would
society. gain scale efficiencies if they are under a
single command.
The government and its agencies perform
the public services that are fundamental to Moreover, the necessary public services are
the stakeholder’s interests – from education provided by the state since no private entity
rights to protection and defense or ONG would have the required resources
responsibilities. to handle such operations. Usually, the
state receives assistance from those other
entities.
Real and perceived performance
The operations carried out by the public sector are realized with the funding from taxation. Since
around 47% of the value of the wage in Romania represents the amount taxable by the state,
the citizens/stakeholders compare the services received from the public sector with those
received from the private sector.
With almost half of their wages returning to the state under the form of taxes, the stakeholders
will form their own opinion on how well their funds have been managed, and to what extent
their needs have been fulfilled. Many do criticize the public sector in their practices, especially
when it comes to fundamental services such as education, health, and safety.
The public sector will only have the support of the stakeholders if their confidence and
satisfaction is mirrored in performance.
Marketing tools for the public sector
Education represents the foundation of any Among those are listed the following:
sustainable and performant service.
- total quality management, customer-
The public executants must be driven strategy, self-managing teams, flat
experts/professionals in their respective organizations, visionary leadership, re-
fields. Many return to school to gain more engineering, performance metrics and
skills and knowledge, especially in the appraisal, incentive systems and pay for
public administration field. performance, cost-benefit analysis,
outsourcing, e-government and e-
The public sector slowly adopted tools and
information, learning organizations, lean
practices from the private sector.
production.
But there are so many differences…
The public sector is constructed around monopolistic organizations – private entities operate on competitive grounds
The public sector follows the citizen’s interest – private entities aim at maximizing profits
The public sector is (as far as we know) transparent – private entities do not activate publicly
Citizens are divided into groups of interests – businesses benefit from lobbying
Citizens are growing more alienated from the governmental activities, and distrust their leaders – business leaders and investors are showcasing more and more interest in their ventures
Some units of government are poorly managed – businesses have clear strategies they follow
Citizens approve/disapprove their political leaders during elections – business leaders are accountable only to the board of directors
Decision-making within the public sector is moving slowly – Decision-making within the private sector is fast and uncontestable
Public operations have limited funds available – enterprises might benefit from a wider range of financial investors
The public activity is very fragmented – the private sector has centralized activities
The public sector has to deal with a wide range of domains – the business entities focus on the products/services they provide
The public sector distribute, redistribute and regulate resources – the private sector mainly produce and distribute resources
No excuses
The differences between the public and
private sectors stand for better
understanding how they are managed and
organized, why they make certain decisions,
and whom they direct their activities and
services toward. The differences do not
underline the possibility of making excuses,
it is only a characterization and knowledge
transfer for better understanding the
processes within.
Change is inevitable
During the last two decades, and especially during this last year, we have understood that
change is the only constant in our lives. These changes have affected equally the private and the
public sectors. There are new challenges (such as the forced digitalization of almost all public
institutions, the forced economic collapse of parts of the business sector), and at the same time
there are new competitors (private entities that could provide better digital services than the
public sector might be able to, and public entities that budgeted well enough to manage better
transformative periods). But none of those entities have unlimited funding, and they both must
read out the forces and technologies that are shaping the landscape. Strategies and methods for
efficient services and activities within the scope of change management represent the main way
into the future of the public sector.
So, how can marketing help?
Marketing might seem not fit for the work of the public sector – it is misunderstood and
overlooked by the personnel of the public sector. Nevertheless, advertising is used when new
military personnel is recruited each year, for instance. But its usage could also be interpreted as
manipulative actions toward the stakeholders, and this negative image stems from its effect on
the private sector.
But marketing does not only represent advertising and continuous stream of sales promotion. It
is also research, finding out what it is that the people need, it is choosing the best option with
the highest benefits for the stakeholders, and it is the best planning platform for the public
services through the delivery of real value.
Marketing mantra: citizen value and satisfaction.
Marketing-intensive organizations
The marketing intensity of a public By bringing in a more directed approach,
organization can be quantified by the number engulfing their mission, the problem solving
of marketing tools used to deliver the service framework and the outcomes, the public
and by the complexity of the employed sector will benefit from effectiveness of
marketing mix. actions, innovativeness and responsiveness of
public services.
For instance, some government agencies are
extensively using the marketing mix through: Moreover, the public sector will benefit from
new product development, pricing, economic, financial, social, cultural,
distribution channels, public relations, technological perspectives (increased
advertising, customer service, etc. revenues and service utilization, compliance
with law, improved public health and safety
and citizen behaviour toward environment,
community, etc.).
The good news
Generally, using the proper marketing mix by the public sector will ensure not only delivering
better services, and increasing the awareness and responsiveness of stakeholders to the service,
but it will also be a mean for problem solving and decision-making. Based on the stakeholder-
centered approach, the marketing efforts of public entities will alter the perceptions and will
improve their performance – planning, situational analysis, goal setting, market segmentation,
marketing research, brand positioning, strategic blend of marketing tools, evaluation, budgeting,
and plan implementation.
Technology is the mainframe that will allow all those elements to perfectly blend together, and
offer a cohesive solution to stakeholders, and a qualitative, convenient, fair public service.
What is the marketing mindset?
The example of the US Postal Service will offer
a glimpse into what a marketing mindset can
do for a public service.
Apart from partnering with eBay (a private
platform where the US Postal Service has
imbedded a digital postage solution), the
postal administration has appointed a CMO,
and adopted the following elements in its
marketing strategy: a stakeholder/customer
centered approach, market targeting and
segmentation, identification of competitors,
utilization of the marketing mix, monitoring
and controlling the efforts and services.
Principles of Public Marketing
◦ The Selling concept (consumers and businesses
STAKEHOLDER-CENTERED FOCUS will not buy enough of the organization’s
products so that they can meet their goals, and
the org. need to aggressively promote and sell):
5 philosophies: ex. In the US, military recruitment officers are
◦ The production concept (consumers will prefer working in high school campuses to increase
products widely accessible and inexpensive – enrollment rate
organizations should keep their costs low): ex. ◦ The Marketing concept (organizations meet
Waste collection
targeted customer wants and needs and require
◦ The product concept (consumers prefer less promotion)
products of high quality, performance and
innovative features – organizations should not ◦ The Societal Marketing concept (organizations
send into oblivion the needs of stakeholders): should develop and deliver superior value to
ex. Building parks where there is no demand, customers while maintaining and/or improving
increasing public transport without market the society’s well-being)
research
MARKET SEGMENTATION AND TARGETING IDENTIFICATION OF COMPETITION
Dividing the masses into homogeneous groups of people so Avoiding Marketing Myopia; Understanding what it is that the
that organizations can efficiently and effectively match the organization is offering, and making it clear among the
needs of stakeholders through their services. services of competitors
Variables for segmentation and targeting: demographic, Examples of competitors for public services:
operating variables, purchasing approaches, situational ◦ Library  Public Service = Summer reading programme;
factors, personal characteristics. Competitors = Bookstores (direct), Videogames (Indirect)
◦ Education services  Public school; private school (direct),
Types of strategies: undifferentiated (no market home schooling (indirect)
segmentation), differentiated (targeting several market
segments through separate, specific offers), concentrated Competitive strategies: drag race play (direct competition with
(targeting a large share of a submarket) one competitor), platform play (working with others against
competition), stealth play (survive by avoiding direct
confrontation)
MARKETING MIX MONITORING AND CONTROLLING
Using the marketing mix will allow the public Monitoring the efforts of the public sector in order to
service to be catered to the needs of the improve performance, and evaluating the results in
order to make on the go adjustments.
stakeholders, increasing the awareness on the
service, and gaining market ground. The whole control process is designed to maximize the
probability for the organization to achieve the
There is a different perspective on the marketing established short-run and long-run objectives.
mix:
◦ The seller view (4Ps)-Product/Price/Place/Promotion
Therefore, marketing will ensure a set of processes for
creating, communicating and delivering the expected
◦ The buyer view (4Cs)-Customer solution/Customer value to stakeholders, and managing the relationships
cost/Convenience/Communication between the parties involved for their benefit.
Case Study – US Postal Service – A
marketing story
1775 – Post Office Department – guided by the principle “every person in the US has the right to
equal access to secure, efficient, and affordable mail service” – practicing a customer-centered
approach since the beginning
2000s – USPS – guided by the principle “Working for you” – more than 2 centuries later, USPS
still follows the same mindset and uses marketing intensively in their efforts of distributing their
public services
SEGMENTING AND TARGETING MARKETS – USPS has developed a wide range of postal services
to cater as many needs as possible, and they have implemented programmes to provide
premium value to specific market segments (including the digitalization of their services with
online postage solutions, and online carrier pick-up notifications).
Case Study – US Postal Service – A
marketing story
COMPETITION IDENTIFICATION UTILIZING THE MARKETING MIX
Many private competitors (UPS, FedEx, etc.) Developing a 5 year strategic plan:
and franchised mail retailing systems ◦ Product/Service (wide range of services and postal
products)
(offering new and improved services) ◦ Price (possibility to personalize the basic service with
payable add-on services; price discounts and
The approach has been that of learning incentives for increased mail volume and customized
from the best, and working together toward services)
making a complete and efficient service for ◦ Place (improving convenience, self-service stations)
◦ Promotion (raise the awareness of basic principles,
the client (partnerships with FedEx, eBay, sustained practice, innovation, feedback adjustments)
etc.)
Food for thought…
Questions:
1. How can you measure the public sector performance?
2. Please identify a public service and try to think of ways in which the authorities can seize the opportunity and
increase their performance.
3. Considering the above chosen public service, please identify at least 3 similarities and differences between the
service offered by private institutions and by public institutions. At what conclusions do you arrive?
4. If you think of how a marketing intensive organization works, could you point out some public organizations
that are using marketing in such a manner?
5. What are the 3 principles followed by USPS? Why do you think they were successful for more than 2 centuries?
Chapter 4. Public Marketing in Action
A public service organization is a body implementing public policies, through the production of
(mainly) services, as a result of a coordinated resource disposition. The public organization
usually is dependent on the political authority and it has limited autonomy regarding the way in
which it works, functions, and is organized. According to the Weberian model, the civil service is
neutral, is hierarchically organized and specialized by function.
Starting with the proliferation of democratic practices and doctrines, new concepts appeared –
new public management (model inspired by the private sector and their practices, based on the
notion of competition being the guarantor of efficiency and performance), and democratic
governance (model developed in the 1990s and 2000s as a reaction to the NPM; this model is
inspired by the notions of accountability, transparency and citizen participation).
The development of the public sector
Marketing in public organizations is constructed on the understanding of how the public sector
works in the democratic political systems, and on the functioning of the management system
within these organizations. Generally, these entities appeared as a result of the development of
the liberal states, where the principles of liberty and individual responsibility confer the
premises for no violation of citizen’s fundamental rights. Historically, the beginning of the 20th
century has showcased the necessity of defining the limits of state power on behalf of the
government and of central administration. The relationship between the state and its citizens is
governed by administrative law, and the management of public organizations is influenced by
the application of corresponding rules of procedure. These elements have developed over the
decades, but the growing population has become a motive for a growing public sector. The
diversification and complexity of the state’s economic activities (including the welfare system)
has put a toll on the functioning of the state’s operations, and that triggered consequences 
Consequences…
The administrative structures diversified their public services and engaged into delivery process a
wide range of public organizations.
The relationships between those public organizations and the stakeholders of public services was no
longer bound only to the administrative law. There have been established new types of relationships,
this time informal, no longer completely connected to the political processes, which made possible
the introduction of marketing elements into the analysis of stakeholders’ needs, the strategy of
diversification of certain services, the usage of key performance indicators, and the development of
complex communication activities among others.
Those changes have underlined the elements of the system that did not function at full or efficient
capacity, and showcased the need for stakeholder-led approaches, for competition within and
between public entities and for partnerships and research with the private sector.
New Public Management
The introduction of new management concepts in The status of public organizations, coordinated by
the public system has led to the utilization of their public nature, is the result of the political
marketing and marketing tools – satisfaction process to control and monitor their activities,
analysis, fee systems, promotional activities, which also means that the law applies in any case
development of brands, etc., and have slowly but of actions between the organization and its
surely determined the wide spread usage of private stakeholders. Therefore, the public organizations
practices, management methods and techniques. might not only offer different types of services to
their stakeholders, but also enforce coercive
The main elements that have been assisted with measures upon the latter (e.g. fines, prohibitions,
those changes are: the status of public rules, procedures, arrest, etc.).
organizations, their objectives, their tasks, and their
environment. Consequently, the autonomy of the public sector is
limited by the rules and procedures that overtake
the managerial choices.
Characteristics of public organizations
OBJECTIVES TASKS
Public organizations must manage a complex system of The tasks of public organizations must have a legal
objectives. Those objectives might be even basis, and if the lawfulness of action is not
contradictory sometimes  an example could be the confirmed, the organization cannot act upon that
following: a public organization is incentivized to offer task. A public organization does not only provide a
high-quality services, but at the same time the wide range of services (and even goods) to its
organization must provide identical services to all stakeholders, they are also involved in the
citizens, which will eat into the possibility of high realization of public policies that satisfy the
value. Moreover, public organizations are pushed into
stakeholders’ needs (outcome oriented approach).
managing a certain budget, but they do not have
autonomy in their budget allocation, and having In measuring its performance, a public entity
numerous constraints it basically removes the principle cannot be reduced at the level of relationship with
of ‘seize the opportunity’. its beneficiaries, it must also estimate the collective
welfare of its stakeholders.
Action board
The environment in which public entities work is Public organizations might be forbidden from
not normally a market situation – it cannot make developing certain services, in certain conditions,
services available selectively, and it must face the and they even face limitations in terms of service
multitude of stakeholders. The public organizations differentiation regarding the stakeholders, in the
are also accountable for their actions – vertically (to selection of stakeholders and so on.
political authority), and horizontally (to partners,
media, general public). It is therefore the case to formulate a conclusion
regarding the type of comparison to the private
The marketing concepts and tools are available for sector, and the general capacity of public entities to
public organizations, but it does not mean that they adhere to principles wide spread in the private
can be used in the same conditions as they are sector. Marginally, public entities do have access to
used in the private sector. The framework of the all the principles, concepts, tools, instruments,
public sector and the conditions in which they are strategies of the private sector, but they are mostly
active are not homogeneous and might even be in fundamental in slightly unimportant aspects
highly restrictive. (Allison, 1979).
Management models in Public
Organizations
There are 3 management models in the public organizations: Weberian model, New Public Management, and
Democratic Governance model.
The Weberian model was inspired from the studies of military, religious and administrative institutions, which
drafted the most appropriate means of administering laws effectively and coordinating complex activities. It
offered a reference for the development of the following models, and it is now criticized for its focus on the
power structure of the public organizations.
Consequently, the NPM has been created, a model that places efficiency of public action at its core, and is based
on the management principles of private enterprises. NPM states by the principle that public organizations must
be autonomous and have a free choice of management tools for performing tasks; the autonomy would be made
through a contractual agreement between the political authority and the public institution (service provision
contract), which would comprise of all the KPIs for the organization’s capacity to adhere to the contractual terms.
For efficiency reasons, all this would be based on competitive principles, and the main approach should be
oriented towards stakeholders’ needs. 
Management models in Public
Organizations
The NPM allows for the usage of marketing strategies and tools, to the extent where
performance is measured based on the satisfaction of stakeholders, and the organization will
have the capacity to cater to those needs through the differentiation of services. Limitations and
criticism of this management model comprise of: concentration on certain services on the
detriment of others, organizations must adapt falsely to the competitive environment,
opportunistic behaviour to fulfill contract terms, expansion of service offering to the detriment
of public policy, emergence of managerial bureaucracy, reporting systems outside of their basic
missions, etc.
The Democratic Governance management model is based on the following principles:
accountability, transparency, networked governance, co-production of public policies,
implementation and superposition of various managerial approaches.
Democratic Governance
Accountability – the capacity of the organization to The stakeholders are involved in the process of
account for its decisions, use of resources, and defining a public policy and in its implementation.
actions to both political authority and the
stakeholders. Since the complexity of the public sector is
tremendous, it is important to employ different
Transparency – organization’s processes and methods of managing all the public organizations,
internal decisions are open to third parties; it can and even institute hybrid versions of the
be documentary, financial, legal or deliberative. management models in the politico-administrative
system.
Networked governance – concluding arrangements
between actors at the same level or at different For instance, universities operate in highly
institutional levels for performance of public tasks. competitive environments, and their management
model cannot be the same as in the case of public
entities active in less competitive markets.
Management models for public entities
Classical model New Public Democratic governance
Management
Politico-administrative Public service as an Universal service Democratic service
structures institution Small-sized units Differentiation in
Large, complex Decentralization and structures
departments/ministries autonomy Some units given
Centralization and Privatization of some autonomous powers of
hierarchy services coordination
Government- Logic of separation Logic of separation Logic of interaction
administration Hierarchical authority Contractual authority Institutional and
relationship professional authorities
Administration-citizen Collective relationship Individual relationships Holistic relationships
relationship will all citizens with specific sub-groups with all citizens
Pasquier, Villeneuve, 2012
Management and marketing in the public
sector
The relationship between the public sector and the The NPM was constructed around the satisfaction
stakeholders is fundamental from the perspective of the stakeholders, and incorporated to some
of marketing. Management will give the general extent the individualization of their relationship.
direction of the public entity, and it will organize Marketing now has an important role, and the
the activities, and marketing will make sure that the overall activity of the organization, its performance
mission and objectives of the public enterprise are is measured/evaluated based on its capacity to
efficiently achieved. satisfy stakeholders.
If the Weberian model included the standardization The Democratic Governance goes one step further,
of public services for all stakeholders, the marketing and it all about creating special relationships with
aspects were merely there. stakeholders, but also firmly covering the ground
with the institutional framework. Marketing here is
in its best environment.
The concept of marketing
For the public sector, the use of marketing is no easy Today, marketing is the umbrella for numerous
task, especially since the concept is associated with concepts and the most important questions it searches
persuasion, advertising and even manipulation. the answer for are the following:
The term ‘marketing’ and all the theories, concepts, - What is the nature of the content of the exchange?
principles, instruments associated with it have a rather
short history, taking place in the 20th century, when it - What are the relationships between the various
was used in the distribution of agricultural products. exchange partners?
By the end of the 20th century, marketing was already a
science, and its development has integrated analysis - Which processes need to be introduced for the
systems and competition strategies, globalization and partners to be satisfied by the exchange?
internationalization of commercial activities, functions
within the enterprise, new modes of communication,
systemic approach to the corporate environment.
Applying marketing to the public sector
MARKETING PUBLIC MANAGEMENT
- Broadening of the concept of exchange - Development of the state’s economic activities

(from commercial to non-commercial) - Development of services to citizens
- Development of the relational component - Greater independence given to certain

of the exchange administrative entities
- Importance of the satisfaction of service

- Use of new tools and techniques beneficiaries
(communication, collection and data
- Emergence of a more individualized relationship
analysis, etc.) between administration and citizen
Broadening the concept of marketing
By bringing together the relational aspects of marketing and the development of marketing
instruments and techniques, the non-commercial aspects of the exchanges are taken into account, so
the tools and concepts can be applied to the public sector. Basically, the state has developed its
services for citizens, and that has required the use of marketing tools from the private sector. At the
same time, part of the administrative units have become autonomous – state agencies, and they have
employed hybrid management systems and models, with the main scope of creating individualized
relationships and exchanges with the stakeholders/citizens.
With the proliferation of the NPM, the measurement of the quality of the exchange between the
stakeholders and the public enterprises has finally been directed towards the stakeholder, the latter
stating the level of perceived and received quality of services. As a result, the public entity would
require marketing tools for the measurement of the satisfaction level of its stakeholders.
Using marketing
It is clear that marketing is now a key resource in the public administration management
models, and that the public sector is actively engaged in numerous marketing activities to
promote their services, but there is still a sort of uncertainty with regard to the social ties
between the 2 parties involved.
Governments have introduced competition within the public services, and the public entities
have defined requirements for the improvement of their offering. That is the reason why the
uncertainty lingers within the public sector, as their financing depends on their results. So they
need to efficiently appreciate the needs and expectations of stakeholders, to detail the content
of the offering, and to improve the communication about the offering by using marketing
instruments.
Case Study – Introducing competition to
Swiss Unemployment Funds
Switzerland offers unemployment benefit, provides benefit payments to unemployed and offers
counselling to help them find jobs. The Swiss benefit-payment system is dual – public and
private funds. Each Canton is legally required to have a public fund for its residents, and the
latter have the free choice of fund. The fund itself does not differ from public to private, but
there is competition regarding the components of the service (proximity, ease of access, etc.).
At federal level, the state regulates the system by paying each fund compensation for the service
provided, based on the fund’s average costs over the previous year. A fund whose costs were
above average must therefore finance the shortfall itself; while funds whose costs were below
average may keep the profit (some public funds even pay out part of its profit to their
employees).
Pre-conditions for marketing use in public
management
- At least two parties are involved Relationship in the exchange:
- Each party own something that may be of - personal interaction

value to the other
- freedom within the relationship (which
- Each party derives benefit from the must not involve constraint)
exchange
Clearly many of the public services lack one
- The exchange must be voluntary, with the of the conditions (no satisfaction – paying
parties free to accept or decline the other’s taxes, no voluntary exchange – vehicle
offer testing, relationship involves constraint –
police stopping vehicle on the road)
Opportunities for differentiation
To use marketing tools, public entities must introduce differentiation to the offer and the
potential involvement of the stakeholders in the exchange.
Differentiation in the offer of services: university course adaptation to training, profiling, etc.
Differentiation of price: intensity of use and time of use of public transport
Differentiation in access to service: completing tax forms – traditional written, through software,
online
Public marketing and Marketing of Public
Services
Public marketing involves marketing Marketing of public services is not limited
services provided by public entities, and the to services provided by public entities,
marketing of specific public sector domains some of the public services are delegated
such as social marketing, place marketing, to NPOs (non-profit organizations), which
or museum marketing. The corresponding enjoy even greater autonomy in conceiving,
organizations enjoy a certain autonomy in delivering and promoting the services.
performing their tasks. Example: postal service, energy – public
services provided by public and private
entities and are based on traditional
marketing
Characteristics of public service marketing
Market characteristics Organization’s Exchange characteristics Relationship
characteristics characteristics
Supply and demand are Law defines the framework Public services are Political considerations
particular of action collective entities (non-rival, Attaining political and
Demand does not depend Limited autonomy and non-exclusive, indivisible) public goals
solely on individual needs flexibility in the conception Limited funding Partial measures for
Access to market is limited of services, setting prices Contribution to the society analyzing the needs of
(monopoly, licences, law and possibilities of access to stakeholders
defined access rights) service
Multiple goals, non-
commercial in nature
Marketing activities and
measures hard to evaluate
Sizable political control of
the organization
Marketing for public services
Public action derives from a publicly defined issue (public conscience and demand) which
receives a political response (voting the legal framework). Sometimes, public action may limit
consumption rather than stimulate it. Using marketing to define individual needs and promote
services comes into conflict with the democratic process.
There is no clear answer to which is the best use of marketing in the public sector. Some
marketing tools and marketing approaches will help improve the services and the relationship
with the stakeholders.
But marketing will not work alone within the strategical approach – it will be rather a mean
alongside political, sociological, cultural and economic approaches in the realization and delivery
of public services for the benefit of the citizens,
Food for thought…
1. What are the marketing-related initiatives present in your university?
2. What do you think are the limits to applying public marketing in your university?
3. How does a public organization of your choice envisage the relationship with its stakeholders?
4. Do you believe marketing should be a term officially used in any public organizations? Argue
your answer.
References & Recommended Reading
1. Bean, J., Hussey, L. (2011). Marketing Public Sector Services. Second Edition. Essential Skills for the Public Sector. London: HB Publications.
2. Canel, M.J., Luoma-aho, V. (2018). Public Sector Communication: Closing the Gap Between Citizens and Public Organizations. John Wiley & Sons.
3. Fine, H.S. (2017). Marketing the Public Sector: Promoting the Causes of Public and Nonprofit Agencies. Routledge.
4. Grigorescu, A., Bob, C.A., Dobrescu, E.M. (2007) Marketingul afacerilor publice şi private, Editura Uranus, Bucureşti.
5. Kotler, P., Lee, N. (2007). Marketing in the Public Sector: A Roadmap for Improved Performance. New Jersey: Prentice Hall.
6. Pasquier, M., Villeneuve, J.P. (2012). Marketing Management and Communications in the Public Sector. Abingdon: Routledge.
7. Proctor, T. (2007). Public Sector Marketing. Essex: Pearson Education Limited.
8. Sakas, D.P., Nasiopoulos, D.K. (2019). Strategic Innovative Marketing. Springer.
9. Sweeney, J. (2019). Public Sector Marketing Pro: The Definitive Guide to Digital Marketing and Social Media for Government and Public Sector.
Digital Training Institute Limited.
10. Temporal, P. (2015). Branding for the Public Sector: Creating, Building and Managing Brands People Will Value. John Wiley & Sons.

Public Marketing

Uploaded by

Document Information

Original Description:

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Public Marketing

Uploaded by

Copyright:

Available Formats

Public

Adriana GRIGORESCU, PhD. Professor

Chapter 2 – Marketing in the public sector

Chapter 3 – Public Sector Performance

Chapter 4 – Public Marketing in Action

The management process for identifying,

It is also about establishing relationships to

So, how does it qualify for the public

Instead of CUSTOMERS, the public sector has STAKEHOLDERS

Types of communication within an organization: management (messages conveyed by

Nevertheless, PERSUASIVE communications involve MARKETING

The discussion is not that straightforward in the case of public sector:

Using marketing for promoting self-interest

Promoting key political objectives

2. a free service provider – the stakeholder

3. a permanent service provider

The public sector is now expected to

Stakeholders Competitors Market trends

- inputs to the service

- client satisfaction feedback system

1. How can you measure the public sector performance?

- Broadening of the concept of exchange - Development of the state’s economic activities

- Development of the relational component - Greater independence given to certain

- Importance of the satisfaction of service

- Each party own something that may be of - personal interaction

Differentiation of price: intensity of use and time of use of public transport

7. Proctor, T. (2007). Public Sector Marketing. Essex: Pearson Education Limited.

8. Sakas, D.P., Nasiopoulos, D.K. (2019). Strategic Innovative Marketing. Springer.

You might also like