Marketing Management

1 Defining Marketing for the 21st Century

Chapter Questions

Why is marketing important? What is the scope of marketing? What are some fundamental marketing concepts? How has marketing management changed? What are the tasks necessary for successful marketing management?

Copyright 2013 Dorling Kindersley (India) Pvt Ltd. Authorized adaptation from the United States edition of Marketing Management, 14e.

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What Is Marketing?

Marketing is an organizational function and a set of processes for creating, communicating, and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders.


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What Is Marketing Management?

Marketing management is the art and science of choosing target markets and getting, keeping, and growing customers through creating, delivering, and communicating superior customer value.


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What Is Marketed? Goods Services Events Experiences Places

Copyright 2011 PearsonDorling Kindersley (India) Pvt Ltd. Authorized adaptation from Copyright 2013 Education, Inc. Publishing as Prentice Hall the United States edition of Marketing Management, 14e.

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What Is Marketed? Persons Properties Organizations Information Ideas


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Demand States

Negative Nonexistent Latent Declining

Irregular Unwholesome Full Overfull


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Cont.

1) Negative demand- consumers dislike the product & may even pay a price to avoid it 2) Non existent demand- Consumers may be unaware of or uninterested in the product 3) latent- consumer may share a strong need that cannot be satisfied by an existing product. 4) Declining demand- Consumers may begin to buy the product less frequently or not at all.1-8


5) Irregular demand consumer purchases vary on a seasonal, monthly, weekly, daily, or even hourly basis 6) Full demand- Consumers are adequately buying all products put into the market place. 7) Over Full demand- More consumers would like to buy the product that can be satisfied 8) Unwholesome demand- consumers may be attracted to products that have undesirable social consequences.1-9


Figure 1.1 Structure of Flows in Modern Exchange Economy


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Figure 1.2 A Simple Marketing System


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Key Customer Markets

Consumer markets Business markets Global markets Nonprofit/Government markets


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Consumer MarketCompanies selling mass consumer goods and services. E.g.: soft drinks, toothpaste, television, etc This requires getting a clear sense of their target customers and what needs their products will meet and communicating brand positioning forcefully and creatively.


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Consumer Market

Consumer marketers decide on the features, quality level, distribution coverage and promotion expenditures that will help their brand achieve a leading position in their target market.


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Business Market

Companies selling business goods and services. Business buyers buy goods and services for their utility in enabling them to make a product or resell a product to others and they purchase products to make profits.

Businesses marketers must demonstrate how their products will help customers to achieve higher revenue or lower cost.1-15


Global/ International Market

Companies selling business goods and services. Business buyers buy goods and services for their utility in enabling them to make a product or resell a product to others and they purchase products to make profits. Businesses marketers must demonstrate how their products will help customers to achieve higher revenue or lower cost.1-16


Non profit and government market

Companies selling their goods to non profit organizations such as churches, universities, charitable organizations and government agencies.


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Rural Markets in South Asia

Rural markets offer immense potential for market expansion and growth: Consumption in rural markets predicted to grow at a CAGR of 5% in the next two decades. Size and growth rate for many products and product categories are very attractive. 48 percent of the rural population is below 20 years of age.1-18


Core Concepts

Needs, wants, and demands Target markets, positioning, segmentation Offerings and brands

Value and satisfaction Marketing channels Supply chain Competition Marketing environment


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Core Concepts of Marketing

Needs, wants demands

Products

Utility, Value & Satisfaction

Markets

Marketing & Marketers

Xchange, Transaction Relationships


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Core Concepts of Marketing

Need food ( is a must ) Want Pizza, Burger, French fry's ( translation of a need as per our experience ) Demand Burger ( translation of a want as per our willingness and ability to buy ) Desire Have a Burger in a five star hotel


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Types of NeedsStated Real Unstated Delight

Secret


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1) Stated- the consumer wants an inexpensive car 2) Real need- consumer wants a car whose operating cost, not its initial price, is low 3) Unstated need- consumers expects goods services from the dealer 4) Delight needs- the consumer would like the dealer to include an extra GPRS in Car 5) Secret needs- consumer wants friends to him as a1-23


Offerings and Brands


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Value and Satisfaction

Quality

ServicePrice


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Value..

Value:- Reflects the sum of the usage of tangible and intangible benefits and costs to customers. Its a primarily a combo of Quality, service & Price( qsp), called the customer value . Its a central marketing concept. Ex. M & M SORPIO CAR


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Satisfaction

Satisfaction:- reflects a persons judgments of a products perceived performance ( or outcome) in relationship to expectations. If the Performance expectations= customer is satisfied And if it exceeds them, the customer is delighted.1-27


Marketing ChannelsCommunicationDistribution Service


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Communication

It deliver & receive messages form target buyers and include newspapers, magazines, radio, T.V, E-mails, phones, billboards, Internet etc For our marketing we wear clothes the same way firms communicate through the look of their retail stores, the appearance of their Web-sties & other media.. Ex. Toll free numbers..1-29


Distribution channels

The marketer use distribution channels to display, sell, or deliver the physical product or services to the user or buyer. They include distributions, wholesalers, retailers, and agents.


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Services channelsThe marketer also uses service channels to carry out transactions with potential buyers. Service channels include warehouses, transport companies, banks & insurance companies that facilitate transactions. Ex. German based Metro retail chain


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Marketing EnvironmentDemographic Economic

Political-legal

Socio-cultural

Technological

Natural


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Major Societal Forces

Network information technology Globalization Deregulation Heightened competition Industry convergence

Retail transformation Disintermediation Consumer buying power Consumer information Consumer participation Consumer resistance


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Company OrientationsProductionProduct Selling Marketing


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Production

One of the oldest concept. It hold that consumers will prefer products that are widely available and inexpensive. Managers of production-orinted


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The Product concept

Proposes that consumers will prefer products that have better quality, performance and features as opposed to a normal product. The concept is truly applicable in some niches such as electronics and mobile handsets. Ex. Apple and Google. The customer needs should be given priority.


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Due to lack of innovation and new features. Each Microsoft operating system appears almost similar with just few tweaks. Thus companies following the product concept need to concentrate on their technology such that they provide with excellent feature rich and innovative products for optimum customer satisfaction.


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The Selling Concept

The Orientation assumes that consumers will either not buy or not buy enough of the organization's products unless the organization makes a substantial effort to stimulate their (consumers) interest in its products.

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Selling cont

Consumers normally tend to avoid buying some things that are not essential Concept used on unsought goods such as smoke detectors, insurance (especially life assurance policy), club membership, etc. This group of sellers is often well equipped with various techniques or strategies aimed at finding prospects and emphasize the benefits of the products.1-39


Marketing concept..

Text BOOk.


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You see gorgeous girl in party, you go to her & say I am rich marry me Direct Marketing You attend party & your friend goes to a girl & pointing at you tells her. He's is very rich, marry him - Thats Advertising. Girl walks to you & says u are rich, can u marry me? - Thats Brand Recognition


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Connect D..oo.ts

4. You say I m very rich marry me & she slaps you - Thats Customer Feedback 5. You say I m very rich marry me & she introduces you to her husband - Thats Demand & Supply Gap 6. Before you say I m rich, marry me, you wife arrives - Thats Restriction from Entering New Market


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Figure 1.3 Holistic Marketing


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Relationship MarketingCustomers

Employees

Marketing Partners

Financial Community


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Integrated MarketingKey themes:

(1) many different marketing activities can create, communicate, and deliver value, and(2) marketers should design and implement any one marketing activity with all other activities in mind.


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Internal Marketing

Internal marketing is the task of hiring, training, and motivating able employees who want to serve customers well.


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Performance Marketing

Financial Accountability

Social Responsibility Marketing


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Figure 1.4 The Marketing Mix


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New Ps.

Permission :- to talk to you (customer) Perception:- Understanding what you want Participation:- Involving you in as many ways as possible.


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The Marketing ProcessBusiness Mission Statemen t Objective s Situation or SWOT Analysis

Marketing StrategyTarget Market Strategy

Marketing MixProduct Promotion Place/Distribution Price

Implementation Evaluation, Control Copyright 2013 Dorling Kindersley (India) Pvt Ltd. Authorized adaptation from the United States edition of Marketing Management, 14e.

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The New Four PsPeopleProcesses Programs Performance


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Marketing Management Tasks

Develop market strategies and plans Assess market opportunities and customer value Choose value Design value Deliver value Communicate value Sustain growth and value1-52


For Review

Why is marketing important? What is the scope of marketing? What are some fundamental marketing concepts? How has marketing management changed? What are the tasks necessary for successful marketing management?


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Marketing Management

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