Marketing Management - Session 2
Transcript of Marketing Management - Session 2
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Marketing Management
Prof. Rubina DMello
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The Meaning of Marketing
Marketing is the performance of business
activities that directs the flow of goods andservices from producer to consumer or user
PRODUCER
Product
CONSUMER
Need
Marketing activities
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Political/
Legal
Economic
Technological
Global
DemographicSociocultural
Competitive
Environment
Industry
Environment
Components of the General Environment
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II. Social ForcesA. Definition includes changes in the
demographic characteristics and the
cultural values of a population.
B. Demographics Easily quantifiableways of describing a population: age,
income, occupation, gender.
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C. Demographic Changes1. Larger population around 300 million2. Older population
- Aging Baby Boom (born between 1946-1964)- Generation X (born between 1965-1976)- Generation Y (born between 1977-1994)
3. Increasingly diverse4. Later Marriage5. Lower Birthrates6. Population Shifts
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III. Economic ForcesA. Why must marketers gauge economic conditions?
B. Inflationary Economy an economy where pricesof goods and services are increasing.
C. Recessionary Economy an economy where thereis a decline in Gross Domestic Product for two ormore consecutive quarters.
D. Consumer Income
- Gross income total household income for one year- Disposable income gross income less taxes
- Discretionary income gross income less taxes and
expenditures on necessities
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Technological ForcesA. Definition refers to inventions or
innovations from applied science or
engineering researchB. Can lead to new product development
C. Can render old products obsolete
D. Ignoring technology often meansbeing bypassed by competition
E. Impact of e-commerce
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LG Plasma Screen TVWhat products might be replaced with this?
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V. Competitive Forces
A. Definition the alternative firms that could provide a product tosatisfy a specific markets needs.
B. Questions to ask: Who are our major competitors (direct and indirect)? What is the size, growth, profitability, and target market of key
competitors? What are competitors key strengths and weaknesses? What are their capabilities in terms of products, distribution,
promotion, and pricing?
C. Where to get the information: Look at what the company says about itself (sales literature,
advertisements, annual reports, trade shows, company website) Look at what others say about the company (customers, sales
force, research firms, business and trade publications)
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VI. Regulatory Forces Regulatory forces are concerned with
the restrictions that state and federal
laws place on business activities. Theyexist to:
ensure competition
protect consumers
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Regulatory Forces (cont.)A. Laws Protecting Competition
B. Laws Protecting Consumers
-Many laws relate to food, drug, and cosmetics- Concerned with labeling guidelines and product
safety
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Regulatory Forces (cont.)C. Product related legislation
Patent law gives inventors the right to exclude othersfrom making or selling products that infringe on their
patented invention for a limited period of time. Copyright law gives the author of a literary, dramatic,
musical or artistic work the exclusive right to print,perform, and copy the work.
Trademark lawA word, phrase, symbol, or design
used to identify an organizations product and set itapart from competition.
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Kleenex, Band-Aid, and Q-TipsIn danger of becoming generic trademarks?
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BuyersSuppliers
Substitute
products
Potential
entrants
Industry competitors
Rivalry among
existing firms
Threat of
new entrants
Bargaining power
of suppliers Bargaining powerof buyers
Threat of
substitutes
Porter's Five Forces Model
Source: Michael E. Porter Competitive Strategy: Techniques for Analyzing Industries and Competitors, (The Free Press, 1980)
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Porters Generic Strategy
Focus
Differentiation
Overall Cost Leadership
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BCG Matrix
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BCG Matrix for TATA Group
Stars Question marks
Cash cows Dogs
Relative market share LowHigh
Industrygrowthrate
High
Low
Automobile,
Tea,
chemicals
Power,
Steel
Oil & Gas
Technology, consultancy,
Engineering services
Composites
Information System
Communication
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SWOT Analysis
SW Internal Factors
Strength
Weakness
OT External Factors Opportunities
Threat
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SWOT Analysis for Tata Group
ExperiencesMicroenvironmentBusiness model
Resource and capabilitiesculture
Value chainDistribution
macroenvironment
ExportsNew ProductsNew Markets
Acquisition and Mergers
Free MarketLow Barriers
Globalisation of Economy