8/6/2019 MM 1 VA 1

1/7

MARKETINGMARKETING

MANAGEMENT IMANAGEMENT I

Porters Value ChainPorters Value Chain

andand

Marketing MixMarketing Mix

8/6/2019 MM 1 VA 1

2/7

Porters Value ChainPorters Value Chain

SeparatingSeparating thethe organizationorganization intointo valuevaluegeneratinggenerating activitiesactivities

OneOne of of thethe twotwo modelsmodels forfor buildingbuilding

competitivecompetitive advantageadvantage AimsAims toto provideprovide valuevalue toto customerscustomers inin excessexcess

ofof costscosts..

ModelModel forfor understandingunderstanding relativerelative strengthsstrengths

AimsAims toto promotepromote competitivecompetitive efficienciesefficiencies

IntegratesIntegrates withwith supplier,supplier, channelchannel andand customercustomervaluevalue systemssystems..

8/6/2019 MM 1 VA 1

3/7

Porters Value ChainPorters Value Chain

8/6/2019 MM 1 VA 1

4/7

Inbound Logistics Receiving, storing, inventory control, transportation scheduling.

Operations Machining, packaging, assembly, equipment maintenance, testing and all other

value-creating activities that transform the inputs into the final product.

Outbound Logistics The activities required to get the finished product to the customers:warehousing, order fulfillment, transportation, distribution management.

Marketing and ales The activities associated with getting buyers to purchase the product including

channel selection, advertising, promotion, selling, pricing, retail management,

etc.ervice The activities that maintain and enhance the product's value, including

customer support, repair services, installation, training, spare parts

management, upgrading, etc.

Procurement Procurement of raw materials, servicing, spare parts, buildings, machines, etc.

Technology Development Technology development to support the value chain activities, such as Research

and Development, Process automation, design, redesign.

Human Resource Management The activities associated with recruiting, development (education),

retention and compensation of employees and managers.

Firm Infrastructure general management, planning management, legal, finance, accounting, public

affairs, quality management, etc.

8/6/2019 MM 1 VA 1

5/7

Marketing MixMarketing Mix

MarketingMarketing decisionsdecisions generallygenerally fallfall intointo fourfour controllablecontrollablecategoriescategories:: Product,Product, Price,Price, PlacePlace andand PromotionPromotion ((44Ps)Ps)..

MarketingMarketing ToolsTools forfor efficientefficient valuevalue creationcreation forfor thethe targettargetsegmentsegment byby takingtaking decisionsdecisions thatthat revolverevolve aroundaround thethe 44PsPs..

GainingGaining competitivecompetitive edgeedge by by decidingdeciding onon thethe rightrightcombinationcombination ofof thethe 44PsPs

OtherOther customercustomer--centriccentric improvisationsimprovisations:: 44CsCs:: CustomerCustomer value,value, CostCost toto thethe customer,customer, ConvenienceConvenience andand

CommunicationCommunication

44RsRs:: Relevance,Relevance, Returns,Returns, RelationshipsRelationships andand ResponseResponse 44AsAs:: Acceptability,Acceptability, Affordability,Affordability, Accessibility,Accessibility, AwarenessAwareness..

8/6/2019 MM 1 VA 1

6/7

Marketing MixMarketing Mix

8/6/2019 MM 1 VA 1

7/7

Product What is the product in need? A good product will sell

itself. Defining the characteristics of the product or

service that meets the needs of customers.

Functionality; Quality;

Appearance;

Packaging; Brand;

Service; Support;Warranty.

Price

How much are the intended customers willing to pay?

Here we decide on a pricing strategy. Price has also an

irrational side: something that is expensive must be

good.

List Price; Discounts;

Financing; Leasing

Options; Allowances.

Place Available at the right place, at the right time, in the

right quantities. Some of the recent major changes in

business have come about by changing Place.

Locations; Logistics;

Channel members;

Market Coverage;

Service Delivery.

Promotion How are the chosen target groups informed or educated

about the organization and its products? Promotion has

become the most important P to focus on.

Advertising; Public

Relations; Message;

Direct Sales; Sales

Promotions; Media;

Budget.