Unit 1 Introduction to Marketing Management

A.Y. 2013 - 14 Semester: 5 (Information Technology) (Course Code: 150001)

Vinita Shah Assistant Professor, IT Dept., GCET

Syllabus
Marketing Management

Financial Management

Production Management

Human Resource Management

Strategic Management

Marketing
Selling Advertising

Promotions

Maintaining Inventories

Making Products Available in Stores

Marketing
Process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods, services to create exchanges that satisfy individual and organizational goals

Art and science of choosing target markets and getting, keeping, and growing customers through creating, delivering, and communicating superior customer value

Marketing Concepts
The marketing concept is the idea that an organization should,

Satisfy the supposed needs of consumers

Try to achieve organizational goals

Marketing Concepts
Six concepts under which organizations design and carry out their marketing strategies

Production

Product

Selling

Marketing

Societal Marketing

Holistic Marketing

Marketing Concepts
Production Concept
1. The company following the production concept believes in the fact that it should produce goods efficiently and try to bring down the prices so that products become affordable. The firm undertakes mass production and makes an effort to improve the distribution.

2.

Important fact:
This happens when the demand is more than the supply

Marketing Concepts
Production Concept

Limitations:
1. The managers may become narrow in their thinking and forget about customer satisfaction. Later they may realize that there is a need to redefine the marketing objectives and plans. Also, the quality may become an issue if it begins to decline.

2.

3.

Marketing Concepts
Product Concept
1. According to this concept, people like products which are very good in terms of performance and quality. The company aims at making a continuous effort towards product improvement and innovation.

2.

Limitations:
1. Here the firm may face problems when substitute products are available. It happens many times that firms fail to predict the future take into account the challenge of substitutes.

2.

Marketing Concepts
Selling Concept
This concept is practiced with unsought goods those that buyers do not normally think of buying such as insurance or blood donations The aim is to sell what the company makes rather than making what the market wants The companys entire focus hence making a lot of sales. is on selling and

Marketing Concepts
Marketing Concept
1. The marketing concept is concerned with first identifying the consumer needs and then making products that give maximum customer satisfaction. The firm here aims to make products and provide services better than the competitors. Here the company makes sincere efforts towards retaining the customers and also attracting new ones. If the customers are satisfied with the product they will buy it again and again and tell other people about it also. Companies like Dell and Wal-mart have great success by following the Marketing concept.

2.

3.

4.

5.

Difference - Selling and Marketing Concepts

Selling Concept

Factory

Existing Products

Selling and promoting

Profits by sales volume

Marketing Concept

Market

Customer Needs

Integrated Marketing

Profits by customer satisfaction

Marketing Concepts
Societal Marketing Concept
1. The Societal concept seems to be the best marketing concept as this gives importance to the societys well being, interests and welfare. Societal concept focuses on consumer needs and wants, profits and also the social welfare. This helps in improving the image of the company. Ex. Johnson & Johnsons credo, Nokia

2.

Here the firms are concerned with social issues like: Environmental problems. pollution caused by the waste material. health problems caused by fast food etc.

Marketing Concepts
Holistic Marketing Concept
Internal Marketing Integrated Marketing

Holistic Marketing

Performance Marketing

Relationship Marketing

Marketing Tools 4 Ps / 4 Cs
15

Marketing Mix

Convenience

Product

Place

Customer Solution

Price

Promotion

Customer Cost

Communication

Marketing Tools 4 Ps / 4 Cs

Product
Variety Quality Features Brand Services

Price
List Price Discounts Payment periond Credit terms Channels Coverage Locations Transportation Inventory

Promotion

Advertising Sales Public relations

Place

Market Segmentation
Market consists of many types of customers, products and needs. Process of dividing a market into distinct groups of buyers who have different needs, characteristics or behaviors and who might require separate products.

Market Segment
Consumers who respond in a similar way to a given set of marketing efforts. Need of segmentation: Ex. Car market Companies are wise to focus their efforts on meeting the distinct needs of individual market segment.

Importance of Segmentation
Mass Marketing
Creates largest potential market which leads to the lowest costs which in turn can leads to lower prices or higher margins. Seller engages in mass production, mass distribution and mass promotion of one product for all buyers.

Importance of Segmentation
Henry Ford applied this strategy when he offered the Model- T Ford in one colour , black.

Importance of Segmentation
Micro Marketing

Levels

Segment Marketing
Group of customers who share a similar set of needs and wants Identify the segments and decide which one to target
Identifiable Group in a Market with Similar Wants Purchasing Power Geographical Location Buying Attitudes

Segment Marketing
Even in segments 100 % needs are not same
Anderson and Narus proposed flexible market offerings to all members of a segment Flexible Market Offering Naked Solution Discretionary Options Products and service elements that all / some segment members value depending on the part. Automobile companies in India offer different versions of same model with different features Airlines offer Economy class and business / executive class

Segment Marketing
Segments based on preferences
Market Segments can be defined in many different ways. One way to carve up a market is to identify Preference segments
Homogeneous : Exists when all consumers have roughly same preferences Diffused : Vary greatly in their preferences. If several brands are in the market they are likely to position themselves throughout the space and show real differences to match differences in consumers preferences Clustered : When natural market segment emerge from groups of consumers with shared preferences

Ex. Ice cream buyers are asked how much they value sweetness and creaminess as two product attributes.

Segment Marketing
creaminess

sweetness Homogeneous Preference - No natural segments - All buyers have same preference

Segment Marketing
creaminess

sweetness Diffused Preference - No Pattern (Poor Research) - Take center position

Segment Marketing
creaminess

sweetness Clustered Preference - Natural segments - Increases as number of competitors increases

Niche Marketing
More narrowly defined customer group Niche = Segment Sub segments
Ex. Washing detergents hard & gentle washes. Surf Excel for tough stains ( hard on clothes) & Ezee from Godrej for delicate clothes (mildness). Crack Toothpaste brands: Vicco Vajradanti, Meswak, Babool. Television Channels: Aastha, Sanskar, Q TV (Religious and Spiritualism) Sports channels

DISTINCT NEEDS PAY PREMIUM SPECIALIZATION LESS COMPETITION

Local Marketing
Marketing programs tailored to the needs & wants of local customer groups in trading areas, neighborhoods , etc. Trend Grass Roots Marketing : Marketing Activities concentrate on getting as close and personally relevant to individual customers as possible. Ex. Spiderman 3 was released in 5 different language in India including bhojpuri. In-City courier companies

Individual Marketing
Ultimate segmentation segments of one or customized marketing or one to one marketing. Customerization Empower the consumers to design the product or service offering of their choice.

Ex. Paint companies have started doing this Asian Paint , Nerolac , Berger Paints Arvind mills launched Ruffn Tuff Jeans, branded ready to stitch