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BASICS
ofMarketing
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Define Marketing
• American Marketing Association: Marketing is the activity, set ofinstitutions, and processes for creating, communicating, delivering,and exchanging offerings that have value for customers, clients,partners, and society at large.
• Marketing makes the journey of a product from its birthplace offactory to the hands of the consumer
• It is a fascinating field involving decisions like knowing the needs ofthe consumer, how to communicate the benefits to the target
audience and reaching the product in the hands of the consumerand then ensuring that the consumer comes back for more
• B2B, B2C
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Marketing vs Sales
• Selling is the act of persuading or influencing a customer to
buy (actually exchange something of value for) a product or
service
• The selling concept, instead of focusing on meeting consumer
demand, tries to make consumer demand match the products
it has produced
• Sales takes the awareness marketing has created and sells to
the people who now know not only about the product, but
now want it
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SELLING V/S MARKETING
SELLING MARKETING
STARTING POINT
MEANS
ENDS
PRODUCT
AGGRESSIVE SELLING
& PROMOTION
PROFITS THROUGH
SALES VOLUME
CUSTOMER NEEDS
SUPERFLUOUS SELLING
PROFITABILITY
THROUGH CUSTOMER
SATISFACTION
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What can be sold
• Services
• Events
• Experiences
•
Persons• Places
• Properties
• Organizations
• Information
• Ideas
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What is a SBU
• SBU – Strategic Business Unit
An SBU has three characteristics:
(1) It is a single business or collection of related businesses thatcan be planned separately from the rest of the company;
(2) it has its own set of competitors; and
(3) it has a manager responsible for strategic planning and
profit performance who controls most of the factorsaffecting profit
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4 Ps
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4 Ps & 4 Cs
4 Ps
• Product• Place
• Price
• Promotion
4 Cs
• Customer Solution• Convenience
• Customer Cost
• Communication
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7 Ps
• Applicable on to servicemarketing
• People: directly or indirectlyinvolved in the consumption of
a service
• Process: Procedure,mechanisms and flow ofactivities by which services areconsumed
• Physical Evidence: The abilityand environment in which theservice is delivered.
• Product
• Place
• Price
• Promotion
• People
• Process
• Physical Evidence
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Selecting the Media
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Low Customization HIgh
One
Way
Two
Way
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• Single source of all these communication to bringconsistency in the communication.
• Integrated Marketing Communication
• Television Advertisement good for awareness but
not as powerful as Sales Promotion to generateAction.
• Cost per Thousand (CPM)
• Pass Along Readership
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• Web as a medium cannot be ignored.
Hyper Impulsivity: Due to closer conjunction ofDesire, Transaction and Payment.
Event Marketing/Sponsorships
Cause Marketing
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Unconventional Media
Novel
Media
Customerservice
Packaging
Events,
Trade shows
Sponsorships
POP
Advertising
specialties
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• 6 M’s for Communication Planning: – Market – Mission
– Message
– Media
– Money
– Measurement
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STP
• Segmentation – A market segment consists of a large identifiable group within a market,
with similar wants, purchasing power, geographical location, buyingattitudes, or buying habits
– Geographic, Demographic, Psychographic, Behavioral
– Niche Marketing: A niche is a more narrowly defined group, typically asmall market whose needs are not being well served.
• Target Market – Marketers evaluate each segment to determine how many and which
ones to target and enter
• Positioning – Positioning is the act of designing the company’s offering and image to
occupy a distinctive place in the target market’s mind
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The STDP Process
Identify marketswith unfulfilled
needs
Discoversegments on the
basis of consumercharacteristics
Analyse segmentpotential &
finalise segmentsto target
Differentiateproduct offering
from competitors
Create a
distinctivepositioning in the
minds ofconsumers
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Segmentation
Massmarketing
Segmentmarketing
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Product Life Cycle
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BCG Matrix
• ?: A question mark requires a lot of cash; company is spending money on plant, equipment, and
personnel. Co has to think hard about whether to keep pouring money into this business.
•Stars: Market leaders in a high-growth market. It does not necessarily produce positive cash flow; thecompany must still spend to keep up with the high market growth and fight off competition.
• Cash cow: produces a lot of cash for the company (due to economies of scale and higher profit margins),
paying the company’s bills and supporting its other businesses
• Dogs: generate low profits or even losses
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GE Investment Priority System
HOLD BUILD BUILD
Harvest HOLD BUILD
Harvest Harvest HOLD
Business Unit Position
I n d
u s t r y A t t r a c t i v e n e s s
Low Medium High
H i g h
M e d i u m
L o w
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Threat of
Substitute
Products
Threat ofNew EntrantsThreat of New
Entrants
Rivalry Among Competing
Firms in Industry
Bargaining
Power of Buyers
Bargaining
Power of
Suppliers
Porter’s Five Forces
Model of Competition
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Product Mix
• The product mix of an individual company can be described in terms of
width, length, depth, and consistency.
• Width: how many different categories (tbr, tp, personal care)
• Length (Line): total number of products
• Depth: how many variants of each product are offered(dry, oily, normal /
size / colours )
• Consistency: how closely related the various product lines are in end use,
production requirements, distribution channels, or some other way.
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Product Mix
LineExtension
MultiBranding
Brand
Extension
New Brand
Development
Same Brand Name New Brand Name
Same Product
Category
New ProductCategory
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Ansoff’s Model
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Branding
• Brand: name, term, sign, symbol, or design, or a combination of these,
intended to identify the goods or services of one seller or group of sellers
and to differentiate them from those of competitors
•
Brand Equity: Brand equity refers to the marketing effects or outcomesthat accrue to a product with its brand name compared with those that
would accrue if the same product did not have the brand name
• The brand can add significant value when it is well recognized and has
positive associations in the mind of the consumer. This concept is referredto as brand equity
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Brand Strategy
• Line extensions: existing brand name extended to new sizes or flavours in
the existing product category
• Brand extensions: brand names extended to new product categories
• Multibrands/Flanker Brands: new brand names introduced in the same
product category
• New brands: new brand name for a new category product
• Co-brands: brands bearing two or more well-known brand names
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Distribution
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Channel Partners/Intermediaries
• Merchants: wholesalers and retailers—buy, take title to, and resell the
merchandise.
• Agents: brokers, manufacturers’ representatives and sales agents—search
for customers and may negotiate on the producer’s behalf but do not taketitle to the goods
• Facilitators: transportation companies, independent warehouses, banks,
and advertising agencies—assist in the distribution process but neither
take title to goods nor negotiate purchases or sales
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Push vs Pull
• A “pull” selling strategy is one that requires high spending on advertising
and consumer promotion to build up consumer demand for a product
• A “push” promotional strategy makes use of a company's sales force and
trade promotion activities to create consumer demand for a product
• In Push strategy the products has to be promoted by Producer to
Wholesalers to Retailers to Consumer
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Experiential/Buzz/Viral
• Experiential Marketing is the art of creating an experience where the
result is an emotional connection to a person, brand, product or idea
• Viral Marketing use pre-existing social networks to produce increases in
brand awareness or to achieve other marketing objectives (such asproduct sales) through self-replicating viral processes, analogous to the
spread of pathological and computer viruses. Viral promotions may take
the form of video clips, interactive Flash games, advergames, ebooks,
brandable software, images, or even text messages.
• Buzz Marketing is a viral marketing technique that attempts to make each
encounter with a consumer appear to be a unique, spontaneous personal
exchange of information
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Misc
• Mind vs Shelf
• ATL
– Above the line is a type of advertising through media such as TV, cinema, radio,print, banners and search engines to promote brands. This type of communication
is conventional in nature and is considered impersonal to customers
• BTL
– Below the Line uses less conventional methods than the usual specific channels ofadvertising to promote products, services, etc.
– Price promotion, Coupons, Gift with purchases, also gifts certificates, Competitions
and prizes, Money refunds, Frequent user/loyalty incentives, Point-of-sale displays,Events
• Horizontal vs Vertical Marketing
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To Read
• Advertising / PR
• Market Research
• Direct Marketing
• Sales Promotions
• Rural Marketing
• CRM