Marketing Management New

8/3/2019 Marketing Management New

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Marketing ManagementMarketing Management

http://www.facebook.com/mr.fortyseven


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Topics to be coveredTopics to be coveredIntroduction

Nature & Scope of Marketing

Evolution

Various Marketing Orientations

Marketing Vs. Selling Concept

Consumer Need, Wants & Demand Concepts



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QuestionQuestion

y What is meant by marketing? What are

the activities involved in marketing?



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MarketingMarketing -- DefinitionDefinitionMarketing is a societal process by which individuals and groups obtain

what they need and want through creating, offering and exchanging

products and services of value with others.

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.

- American Marketing Association

Meeting needs profitably.



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Marketing activities include

y Identifying customer needs

y Designing goods and services that meet thoseneeds

y Pricing goods and services to reflect costs,competition and customers ability to buy.

y Communicating information about those goodsand services to prospective buyers

y

Making the goods or services available at timesand places that meets customers needs

y Providing the necessary service and follow-up toensure customer satisfaction after the purchase



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Marketing Management is the process of

planning and executing the conception,

pricing , promotion and distribution of

ideas, goods and services to createexchanges that satisfy individual and

organizational goals.



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Marketing systemMarketing system

Industry

[a collection of

sellers]

Market

[a collection of

buyers]

Communication

Goods/Services

Money

Information



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QuestionQuestion

Which are the ten different entities

marketed by a marketer? (Imp)



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Scope of MarketingScope of Marketingy Goods Physical goods constitute the bulk of most countries production and marketing efforts. Eg.

Consumer Durables, cars, trucks, television sets , toys, dolls, coins etc. eBay (online trading communityauction site).

y Services Services include the work of airlines, hotels, car rental firms, barbers and beauticians,maintenance and repair people, and accountants, bankers, lawyers, engineers, doctors, softwareprogrammers and management consultants.

y Events Marketers promote time-based events, such as major trade shows, artistic performances,musical concerts and company anniversaries. Global sporting events , such as the Olympics, IPL ,Commonwealth Games and the World Cup are promoted aggressively to both companies and fans.

y Experiences Orchestrating several services and goods, a firm can create, stage and marketexperiences. An amusement park or a water park represents experiential marketing : customers, bytaking different rides in the amusement park or the water park, enjoy the thrill provided by theseexperiences. A theme restaurant that creates the ambience of a village in Rajasthan.

y Persons Celebrity Marketing is a major business. Artists, musicians, CEOs, physicians, high profilelawyers and financiers , and other professionals all get help from celebrity marketers. Major film starshas an agent, a personal manager and ties to a public relations agency. CEOs of companies by printingan article, newsletter etc.



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Contd.Contd.y Places Cities, states, regions, and whole nations compete actively to

attract tourists, factories, company headquarters and new residents. In thesoftware industry, Bangalore is positioned as the Silicon Valley of India. Inthe tourism industry, Kerala is marketed as Gods own country and hasbecome one of the hot spots for tourism.The government of India ismarketing India as a tourist destination through the Incredible Indiaadvertising campaign.

y Properties Intangible rights of ownership of either real property (realestate) or financial property ( stocks and bonds).Properties are bought andsold and these exchanges require marketing. Real estate agents buy and sellresidential or commercial real estate. Investment companies and banksmarket securities to both institutional and individual investors.

y Organizations Actively work to build a strong, favorable and uniqueimage in the minds of their target publics. Universities, performing artsorganizations and nonprofits all use marketing to boost their public imagesand to compete for audiences and funds. Organizations opting for CSRactivities to boost their public image.Tata, Infosys setting up CancerFoundation to have a positive image in the minds of public.



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Contd.Contd.

y Information Information is essentially what books, schools,and universities produce, market, and distribute at a price toparents, students and communities. Magazines such as Road&Track and Auto compile and publish information on cars.

Byte is a magazine selling information on computers. AC

Nielsen is a research company completely into producing anddistributing information.

Ideas Products and services are platforms for delivering someidea or benefit. Social marketers are busy promoting suchideas by creating awareness about AIDS, encouraging family

planning and discouraging smoking which fall in the realm ofsocial marketing.

MS Dhoni SaveTigers

SAY NOTO DRUGS , EXERCISE DAILY.



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QuestionQuestion

Trace briefly the various stages in the

evolution of present day Marketing

system./ What are the various marketing

concepts?



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Evolution of Marketing/ MarketingEvolution of Marketing/ Marketing

ConceptsConceptsy The Production Concept

It holds that customers will choose products andservices that are widely available and are of low cost.

So managers try to achieve higher volume bylowering production costs and following intensivedistribution strategy.This seems a viable strategy in adeveloping market where market expansion is thesurvival strategy for the business. Companiesinterested to take the benefit of scale economies

pursue this kind of orientation. It is natural that thecompanies cannot deliver quality products and sufferfrom problems arising out of impersonal behaviorwith the customers.



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Salient featuresSalient features

y This concept is based on the belief thatcustomers needs can be satisfied with reasonablequality and reasonably priced product.

y The manufacturer should maintain availability ofsufficient quantity of low priced products andconsistency in quality.

y There is fair amount of competition andcompeting products are sold with completeknowledge of the products available in themarket.



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The Product conceptThe Product concept

y Consumers will favour those products

that offer the most quality, performance

or innovative features.Managers in these

organizations should focus on makinginnovative and superior products and

improving them over time.



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Salient FeaturesSalient Features

y Consumers generally look and prefer quality ofthe product.

y Consumers compare quality of products tocompeting product or brand quality.

y Consumers generally buy products to meet theiroverall needs and not specific needs.

y Consumers are aware of the product qualitydifferences between competing brands and theychoose the quality which comes closest to their

preference and their affordable price.y Consumers rating of manufacturers is based on

their quality products and reliability and brandloyalty is also based on quality perception.



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The Selling ConceptThe Selling Concept

y The concept maintains that the company has toaggressively promote and push its products ; itcannot expect its products to get picked upautomatically by the customers. Heavy advertising,

high power personal selling, large scale salespromotion , heavy price discounts and strongpublicity and public relations are the normal toolsused by organisations that rely on this concept.

y

Practised most aggressively with unsought goods,goods that buyers normally do not think ofbuying. Eg. Insurance, encyclopedias etc.



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y Consumers generally do not waste money inbuying things which are not essential orbuying excess quantities than required.

y Consumers prefer to be motivated to buy

things by use of selling efforts byorganisations.

y Consumers appreciate good sellingtechniques, efforts and good salesmanship.

y Consumer rating of organisation and retailoutlets are high where there is an organisedand effective selling effort is made.



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The Marketing ConceptThe Marketing Concept

y It holds that the key to achieving its

organisational goals consist of the

company being more effective than

competitors in creating, delivering, andcommunicating superior customer value

to its chosen target markets.

Product centred Customer centred

(make and sell) (sense and respond)



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y The customers needs and wants are variedand these must be understood and suitableproducts and services offered to match the

requirement.y The market consists of different segments

and these segments can be groupedaccording to the customers characteristics.

y

The consumers in any market may not buy aproduct if they feel that it will not serve thepurpose of solving their needs and wants.



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QuestionQuestion

y Discuss briefly the concept of societal

marketing.



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The societalThe societal--marketing conceptmarketing concept

y It holds that the organisations task is to

determine the needs, wants and interests

of target markets and to deliver the

desired satisfactions more effectively andefficiently than competitors in a way that

preserves or enhances the customers and

the societys well-being.



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Objectives of Societal marketingObjectives of Societal marketing

y To satisfy customers long term needs and

wants and satisfy societys long term

interests. Consumers will prefer and

favour such marketing organisations.

y Consumers are now concerned about

safety and environmental problems and

marketing companies need to understandthem.



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QuestionQuestion

y Differentiate between selling and

marketing concepts.



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Marketing Vs. SellingMarketing Vs. Selling

Dimension Selling Marketing

Focus Emphasis is on

the product.

Emphasis is on

consumer needs

and wants.

Strategy PUSH STRATEGY.

Company

manufactures the

product first and

then decides to pushit in the market.

PULL STRATEGY.

Company first

determines

customer needs

and wants and thendecides on how to

deliver a product

to satisfy these

wants.Orientation

Style

Management is

sales volume

oriented.

Management is

profit oriented.http://www.facebook.com/mr.fortyseven


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planni

ng

Planning is short run

oriented, in terms of

todays products andmarket.

Planning is long run

oriented, in terms of new

products, tomorrowsmarkets and future

growth.

Skills Selling and

conversational. Analytical.

Goal Views business as a

goods producing

process.

Views business as

consumer satisfying

process.

Stresses needs ofseller.

Stresses needs andwants of buyers.

Emphasis is on staying

with existing technology

and reducing costs.

Emphasis is on innovation in

every sphere, on providing

better value to the

customer by adopting a

superior technology.http://www.facebook.com/mr.fortyseven


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Depatments

Different departments

work in highlyseparate water tight

compartments.

All departments of

the businessoperate in an

integrated manner,

the sole purpose

being generation of

customer

satisfaction.Cost determines

price.Consumer

determines price,

price determines

costs.

Selling views

customer as the

last link in

business.

Marketing views the

customer as the

very purpose in

business.



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Market, Marketplace,Market, Marketplace, MarketspaceMarketspace

andand MetamarketMetamarkety Market is a physical place where buyers and sellers

gather to buy and sell goods.

y The marketplace is physical, as when one goesshopping in a market.

y The marketspace is digital, as when one goesshopping on the internet.

y Metamarket is a cluster of complementary productsand services that are closely related in the minds ofconsumers but are spread across a diverse set ofindustries.

Automobile metamarket consists of automobilemanufacturers, new car and used car dealers, financingcompanies,Insurance companies, mechanics, sparepart dealers, auto magazines and so on.



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Exchange andTransactionsExchange andTransactions

Exchange is the process of obtaining adesired product from someone byoffering something in return.

A transaction is a trade of values betweentwo or more parties.

Two parties are engaged in exchange if theyare negotiating trying to arrive at

mutually agreeable terms.When anagreement is reached, we say that atransaction takes place.



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Relationships and NetworksRelationships and Networks

Relationship marketing has the aim of buildingmutually satisfying long term relations withkey parties customers, suppliers,distributors in order to earn and retain their

business.

A marketing network consists of the companyand its supporting stakeholders (customers,

employees, suppliers, distributors, retailers,ad agencies, university scientists and others)with whom it has built mutually profitablebusiness relationships.



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QuestionQuestion

y What do you understand by need, wants

and demand concepts?



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Core Marketing ConceptsCore Marketing Concepts

y Need, Wants and Demands

Needs are the basic human requirements. Peopleneed air, water, clothing and shelter to survive.People also have strong needs for recreation,

education and entertainment.

These needs become wants when they are directedto specific objects that might satisfy the need. AnAmerican needs food but wants a hamburger,

French Fries and a soft drink.Demands are wants for specific products backed by

an ability to pay. Many people want a Mercedes,only a few are able and willing to buy one.



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Needs preexist marketers. Marketers, along

with other societal factors, influence

wants.



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FiveTypes of NeedsFiveTypes of Needs

y Stated Needs -The need stated by the customer tothe marketer.(customer wants an inexpensive car)

y Real Needs The actual need of the customer.(Thecustomer wants a car whose operating cost, not itsinitial price is low.)

y Unstated Needs Need not stated by the customerbut still needs it. (customer expects good servicefrom the dealer.)

y Delight Needs Offering which gives the customerimmense pleasure.(The customer would like thedealer to include free seat covers, music system etc.)

y Secret Needs Customer gets inner satisfaction.(Thecustomer wants friends to see him as a savvycustomer and can impress his peer group.)



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Segmentation,Target Markets &Segmentation,Target Markets &

PositioningPositioningy Identifying and profiling distinct groups of buyers who might prefer

or require varying product and service mixes by examiningdemographic, psychographic and behavioral differences amongbuyers is known as segmentation.

Eg. Microfinance by Muhammad Yunus

y Market segment which presents the greatest opportunity is thetarget market.

y Creating an impact of the market offering in the minds of the targetbuyers as delivering some central benefits.

Eg. Volvo positions its car as the safest a customer can buy.Scorpio is designed for people who prefer a sturdy vehicle thatoffers luxury and comfort. Scorpio is therefore positioned as avehicle that offers the luxury of a car and the thrill of an SUV.



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Offerings and BrandsOfferings and Brands

y Value proposition is a set of benefits thatcompanies offer to customers to satisfy theirneeds.

y Combination of products, services, information

and experiences is an offering. Intangible valueproposition is made physical by an offering.

y A brand is an offering from a known source. eg.

McDonald carries many associations in peoplesminds that make up the brand image : burgers, fun,children, fast food and convenience.



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Value and SatisfactionValue and Satisfaction

y Value reflects the sum of the perceived tangible andintangible benefits and costs to customers. Primarily acombination of quality, service and price called the customervalue triad. Value increases with quality and service anddecreases with price, although other factors can also play animportant role in our perceptions of value.The buyerchooses between different offerings based on which sheperceives to deliver the most value.

y Satisfaction reflects a persons judgements of a products

perceived performance (or outcome) in relationship toexpectations. If the performance falls short of expectations,the customer is dissatisfied and disappointed. If t matchesexpectations, the customer is satisfied. If it exceeds them, thecustomer is delighted.



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Marketing ChannelsMarketing Channels

Vehicle or medium to reach a target market and to transfer goods,services and information from the manufacturer to the buyer.

Communication channels deliver and receive messages from targetbuyers. eg. Newspaper, Magazines, Radio,Television, Mail,Telephone,Billboards, Posters, Fliers, CDs, audiotapes and the Internet.Theyalso communicate through the look of the retail stores, appearanceof the web sites etc. Marketers are increasingly adding dialoguechannels such as e-mail, blogs and toll-free numbers.

Distribution Channels to display, sell or deliver the physical productor service to the buyer or user. Eg. Distributors, wholesalers,

retailers and agents.

Service Channels to carry out transactions with potential buyers.Eg. Warehouses,Transportation companies, banks and insurancecompanies that facilitate transaction.



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Supply ChainSupply Chain

y Longer channel stretching from raw

materials to components to final products

that are carried to final buyers.The supply

chain for womens purses starts withhides and moves through tanning, cutting,

manufacturing and the marketing channels

to bring products to customers.



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CompetitionCompetition

Competition includes all the actual andpotential rival offerings and substitutes abuyer might consider. For an automobile

company planning to buy steel for its cars,there are several possible levels ofcompetitors.They can buy steel fromTataSteel or the SAIL or import from abroad;

or buy aluminum for certain parts tolighten the cars weight; or buy engineeredplastics for bumpers instead of steel.



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Four Levels of CompetitionFour Levels of Competitiony Brand Competition Company competes with other companies offering

similar products and services to the same customers at similar prices. Eg.Volkswagen competes withToyota, Honda, Renault and othermanufacturers of medium-priced automobiles.

y Industry Competition Company competes with all companies making the

same product or class of products. Eg. Volkswagen competing against allother automobile manufacturers.

y Form Competition Company competes with all companiesmanufacturing products that supply the same service. Eg. Volkswagencompeting against manufacturers of motorcycles, bicycles and trucks.

y Generic Competition Company competes with all companies thatcompete for the same consumer rupees.Volkswagen competing withcompanies that sell major consumer durables, foreign vacations and newhomes.



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Marketing EnvironmentMarketing Environment

Marketing Environment- Task Environment

Broad Environment

y Task Environment Includes the actors engaged in producing, distributingand promoting the offering.These are the company, suppliers, distributors,

dealers and the target customers. In the supplier group are materialsuppliers and service suppliers such as marketing research agencies,advertising agencies, banking and insurance companies, transportationcompanies and telecommunications companies. Distributors and dealersinclude agents, brokers and manufacturer representatives.

y Broad Environment Six Components: demographic environment,economic environment, natural environment, technological environment,political-legal environment, and social-cultural environment.



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QuestionQuestion

y What is marketing mix? Define its

constituents.



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Marketing MixMarketing Mix

y The marketing mix is the set of marketing

tools the firm uses to pursue its

marketing objectives in the target market.



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Marketing MixMarketing Mix

Marketing mix

ProductProduct variety

Quality

Design

Features

Brand namePackaging

Sizes

Warranties

Returns

PriceList Price

DiscountsAllowances

Payment

period

Credit terms

PromotionSales Promotion

AdvertisingSales force

Public relations

Direct marketing

PlaceChannels

Coverage

Assortments

Locations

InventoryTransport


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