Marketing Strategy as an Effective Tool for Government Procurement Management

Abstract

This article investigates theoretical and methodological approaches to developing a marketing strategy for public procurement management in the context of European integration processes and reform of the public procurement system in Ukraine. The necessity of implementing a marketing strategy as an effective tool to increase the efficiency and transparency of public procurement activities is substantiated under modern economic conditions. The conceptual foundations for the formation of a marketing strategy for public procurement management are defined. Its main goal is to build successful and long-term partnerships between public customers and supplier companies based on the rational use of budget funds and the development of effective competition. Priority functions of the marketing strategy are outlined: comprehensive marketing analysis of public customers’ needs; market research to find the most competitive suppliers; ensuring effective communication between all participants; and the implementation of effective marketing measures to increase transparency and the openness of procurement procedures. A universal step-by-step algorithm for the formation of a public procurement marketing strategy is developed, including the following: analysis of the current state and identification of deficiencies in the existing system; clear definition of targets, objectives and priority areas for reform; selection of optimal marketing tools; directly implement the strategy and continuously monitor the results. A comprehensive classification of the types of marketing strategies in public procurement by their target orientation is presented. To increase the validity and minimize risks in decision-making regarding supplier selection, an original mathematical model for the formation of competitive prices based on nonlinear programming methods is proposed. This model allows considering the interests of all participants in the procurement process: determining the optimal vector of prices for goods/services based on the utility functions and preferences of customers, their budget constraints, and the technological capabilities of potential suppliers. The versatility of the model lies in the possibility of its application for any number of participants and product groups. The implementation of an effective marketing strategy for public procurement management will contribute to the formation of a highly efficient, transparent and competitive public procurement system focused on the rational use of budget funds, the development of fair competition among suppliers, and the minimization of corruption risks in this area.