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Transcript of unit I of M.M
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Marketing Management
- Utkal Khandelwal
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What is Marketing?
Marketing is defined as the activity, set
of institutions, and processes for
creating, communicating, delivering,
and exchanging offerings that have
value for customers, and society at
large.-American Marketing Association
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Production concept
Product concept
Selling concept
Marketing concept
Development of Marketing Concept
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Nature of Marketing
Marketing is consumer oriented
Marketing starts and end with
customers
Marketing is result oriented
Marketing is system
Exchange process is the essence of
marketing
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Importance of Marketing
Satisfying the needs& wants of
customers
Well being of the firm
Well being of the society
Spring board of business operations
Creating needs
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GLA
Elements ofMarketing
CustomerConsumer
Markets
MarketersDemands
Wants
Needs
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Needs, Wants & Demands
Need- something you have to have
Want -something you would like to have
Demand- want accompanied by buyers
ability to buy
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Needs & Wants
In actuality, you only need four things to survive:
A roof over your head
Enough food and water to maintain your health Basic health care and hygiene products
Clothing (just what you need to remain comfortable
and appropriately dressed)
Everything that goes beyond this a big house, name-brand clothes, fancy foods and drinks, a new car is
a want.
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Customer Vs Consumer
Customer: customer means who purchases
the product from the marketer or from the
retailer or from the wholesaler.
Consumer: consumer means who uses the
product of course purchased by the customer
or prospect. Here we consider finally who is
going to use the product we call them as
consumer.
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What is Market?
PeopleBut- not just any people, they have to have Willingness to buy
Purchasing powerAuthority to buy
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Market
A marketis any one of a variety of
differentsystems,institutions,
procedures,social relations and
infrastructures whereby persons trade,
and goods andservices are exchanged,
forming part of the economy. Itis anarrangement that allows buyers and
sellers to exchange things.
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Types of Market
Consumer Goods and Services
Industrial Goods and Services
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Markets
Free Markets
Currency Markets
Stock Markets
Commodity Markets
Capital Goods &Industrial Markets
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Marketer
Marketers refers to persons or
companies engaged in promoting or
selling products and services that theythemselves have driven the
development or manufacture of.
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Marketer
The term covers a range of professional and
job designations concerned with
development of market research, brand
strategy, advertising, public relations,
packaging and similar issues that arise when
delivering goods or services to competitivemarkets.
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Classes of ConsumerProducts
Convenience Shopping Specialty
Goods
Services
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Marketing and
Selling:
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Sales and marketing are different
Marketing: What and how to sell
Selling: moving the product
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Marketing
What?
Product characteristics
Price sensitivity
Market Characteristics
Size
Defensible
Sustainable
How?
Channels
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Product or Service Requirements
Know about it
Opportunity to purchase
Satisfy a real or perceived need
Affordable (but not too cheap)
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A brief introduction to market
analysis Desk research
Existing market or solutions
Competition, actual and potential
Demographics
Market surveys
Qualitative
groups, usability testing
Quantitative Surveys, test marketing
Distribution channels
Market Communications
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Channels
Direct Sales
Distributor/Retailer
Distributors are your customers National
International
Chose carefully -
changing is expensive and difficult
Key sales
Opinion formers
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Market Communications
Targeting
Advertising
Image
Message
Sales
General - Newspapers, TV
Specific - Trade press, specialist magazines
PR
Direct mail
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Sales techniques
Needs
Concerns
Authority
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Stages in Selling
Prospecting
Pre-approach
Approach
Proposal
Demonstration
Close
Service
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Prospecting
Locating the most likely buyers
Cold calling
Directors Guides, Yearbooks
Local council offices, Chambers of Commerce
Institutional meetings
Qualified Prospects
Marketing response: Advertising, PR, Mailings Service organisation, exhibitions
How many?
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Pre-approach
Research
Who are the decision makers?
What is the management structure?
What are their concerns?
Preparation
Presentation
Visiting cards, brochures
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Approach
Listen, establish mutual ground
Contact building
Generalities
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Proposal S
ell the benefits to the customer Sales proposal
Introduction
Objectives
Recommendations
Benefits
Financial Justification
Warranty and service
Company Background
Price and conditions
Follow-up
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Demonstration
Objectives
Administration
Who, where, maps, car parking,accommodation
Greeting, seating
Catering: coffee, lunch or sandwiches
Script
Rehearse, and stick to the script
Points to emphasise, or not
Sum up
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Close
Small step at a time
Advantages
Customers concerns
hidden agenda
Kicker
Discount, limited offer
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Service
Relationship management
communications
contact point
Regular liaison
early warnings
Spec changes and the consequences
Meeting milestones
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Planning and Records
Graded Prospect List
Sales Forecasts
Call analysis
Sales Cost analysis
Company Contact Previous Contact Next Contact
Name Address Phone Fax Name Decision Makers Potential % Date Who Action Date Who Action
Company Amount ------TimeAnalysis------- ProductA
Q1 Q2 Q3 Q4
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Control and Commissions Control
Sales organisation structure
By product
Geographical
By channel, key account
Measurement
Cost per sale
Response rate
Timeliness
Individual measures, targets
Commission
Dont stint
Basic salary
Pay on delivery, or payment
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Marketing Management
Marketing managementis a business
discipline which is focused on the
practical application of marketingtechniques and the management of a
firm's marketing resources and
activities.
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Functions in Marketing Management
Marketing Research
STP
Setting Marketing Strategy
Marketing Mix
Marketing Controlling
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Marketing Mix
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Definition
Marketing-Mixis composed of a large
battery of advices which might be
employed to induce customers to buy aparticular product.
-Keeley and Lazer
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The Marketing Mix
The tools available to a business to gain the
reaction it is seeking from its target market in
relation to its marketing objectives 7Ps Price, Product, Promotion, Place,
People, Process, Physical Environment
Traditional 4Ps extended to encompass
growth of service industry
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Price
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Price
Pricing Strategy
Importance of: knowing the market
elasticity
keeping an eye
on rivals
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Product
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Product
Methods used toimprove/differentiatethe product and increasesales or target sales more
effectively to gaina competitive advantage e.g.
Extension strategies
Specialised versions
New editions
Improvements real or
otherwise! Changed packaging
Technology, etc.
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Promotion
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Promotion
Strategies
to make the
consumer aware ofthe existence of a
product
or service
NOT just advertising
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Place
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Place
The means by which products and
services get from producer
to consumer and where they can beaccessed by the consumer
The more places to buy the product and
the easier it is made to buy it, the better forthe business (and the consumer?)
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People
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People
People represent the business
The image they present can be important
First contact often human what is the lastingimage they provide to the customer?
Extent of training and knowledge
of the product/service concerned
Mission statement how relevant? Do staff represent the desired culture
of the business?
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Process
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Process
How do people consume services?
What processes do they have to go throughto acquire the services?
Where do they find the availabilityof the service? Contact
Reminders
Registration Subscription
Form filling
Degree of technology
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Physical Environment
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Physical Environment
The ambience, mood or physical presentation
of the environment
Smart/shabby? Trendy/retro/modern/old fashioned?
Light/dark/bright/subdued?
Romantic/chic/loud?
Clean/dirty/unkempt/neat? Music?
Smell?
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The Marketing Mix
Blend of the mix depends upon: Marketing objectives
Type of product
Target market
Market structure
Rivals behaviour
Global issues culture/religion, etc.
Marketing position
Product portfolio
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Characteristics of Marketing-Mix
Mix of policies and activities
Systematic concept and contineous
process
Mix of various mixes
Effectiveness
Integrated marketing strategy
Solution of marketing problem
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Marketing
EnvironmentGLA
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Marketing Environment
The Marketing Environment consists of
external forces that directly orindirectly
influence an organization acquisition ofinputs and creation of outputs.
-Pride and Ferrel
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Key Environments
Marketing Environment
The f actors and forces thataffecta firms ability to buildand maintain
successful relationships with customers.
Aspects of the marketing environment:
Micro-environment
Macro-environment
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Marketing
Environment
Internal
Environment
External
Environment
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Internal Vs External Environment
Internal
Environment are
those factors overwhich a firm has full
control.
External
Environment are
those factors whichcannot controlled or
managed by a
business.
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The MicroThe Micro--environmentenvironment
Departments within the company impact marketing planning.
Suppliers help create and delivercustomer value.
Treat suppliers as partners.
Marketing intermedi
aries help sell, promote,
and distri
bute goods.
Intermediaries take many forms.
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The MacroThe Macro--environmentenvironment
Customer markets mustbe studied.
Consumer, business, government, resellerand international markets exist.
Successfulcompanies provide bettercustomer value than the
competition.
Size and industry position help to determine the appropriate competitive
strategy.
Various publics mustalso be considered.
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Factors ofInternal Environment
Suppliers
Customers
Marketing
intermediaries
Competitors
Publics
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Demographic Environment
Economic Environment
Political and Legal EnvironmentSocial And Cultural Environment
Technological Environment
Competitive Environment
Factors of External Environment
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The Marketing Environment and
CompetitorAnalysis
SWOT analysis
PEST analysis
Five forces analysis
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SWOT analysis
Strengths (internal)
Weaknesses (internal)Opportunities (external)
Threats (external)
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PEST analysis
Political factors
Economic factorsSocio-cultural factors
Technological factors
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Political/legal
Monopolies legislation
Environmental protection laws
Taxation policy
Employment laws
Government policy
Legislation
Others?
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Economic Factors
Inflation
Employment
Disposable income
Business cycles
Energy availability and costOthers?
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Sociocultural factors
Demographics
Distribution of income
Social mobility
Lifestyle changes
Consumerism
Levels of education
Others?
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Technological
New discoveries andinnovations
Speed of technology transfer
Rates of obsolescence
InternetInformation technology
Others?
Fi f l i
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Source: Adapted from M. E. Porter,
Competitive Strategy, Free Press,
1980, p. 4.
Threat ofThreat of
substitutessubstitutes
Potential
entrants
Threat ofThreat of
entrantsentrants
Suppliers
BargainingBargaining
powerpower
Substitutes
Buyers
BargainingBargaining
powerpower
COMPETITIVERIVALRY
Five forces analysis
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Five Forces Analysis: Key
Questions and Implications What are the key forcesat work in the competitive
environment?
Are there underlying forcesdriving competitive
forces?
Will competitive forceschange?
What are the strengths and weaknessesof
competitors in relation to the competitive forces?
Can competitive strategyinfluence competitive forces(eg by building barriers to entry or reducing
competitive rivalry)?
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Qualities of Marketing Manager
Proactive
Adaptability
Focus on specific goals
Emotional stability Extroversion
Openness
Perceptual ability
Ability to learn Positive attitudes
Positive work-related values
Internal motivationGLA