• Marketing management for engineering managers

• Introduction
Marketing management is a business discipline which is focused on the practical
application of marketing techniques and the management of a firm's marketing resources
and activities. (Marketing managers are often responsible for influencing the level,
timing, and composition of customer demand accepted definition of the term. In part, this
is because the role of a marketing manager can vary significantly based on a business'
size, corporate culture, and industry context. For example, in a large consumer products
company, the marketing manager may act as the overall general manager of his or her
assigned product.)

Two major activities of Companies

• Marketing
Management process through which goods and services move from
concept to the customer. It is based on thinking about the business in terms of
customer needs and their satisfaction.
• Innovations
Process by which an idea or invention is translated into a good or service
for which people will pay. (To be called an innovation, an idea must be
replicable at an economical cost and must satisfy a specific need. Innovation
involves deliberate application of information, imagination, and initiative in
deriving greater or different value from resources, and encompasses all
processes by which new ideas are generated and converted into useful
products. In business, innovation results often from the application of a
scientific or technical idea in decreasing the gap between the needs or
expectations of the customers and the performance of a firm's products.)

• THE FUNCTION OF MARKETING

Marketing and sales are critically important to profit seeking companies because
they strive to ensure satisfaction in the exchange of values between the producers and
consumers of products and services. (The marketing functions are performed, in the
main, by manufacturers' representatives or sales agents, wholesalers or jobbers, and
such special-type middlemen as mill-supply houses ( wholesalers) and sales
engineering concerns (sales agents ). Certain kinds of accessory equipment such as
wrenches, electrical supplies, automobile parts, bearings and fans, are handled also by
retailers.)(“Marketing is a social and managerial process by which individuals and
groups obtain what they need and want through creating and exchanging products and
value with others.” The mission of marketing is satisfying customer needs. That takes
place in a social context. In developed societies marketing is needed in order to
satisfy the needs of society’s members. Industry is the tool of society to produce
products for the satisfaction of needs.)

 In modern society production and consumption are apart from each other. Marketing
connects them. From the societal point of view, marketing is a philosophy which
shows how to create effective production systems and consequently prosperity.
  Traditionally, marketing has been seen as a link between production and customer.
The situation could be captured better by using the term selling. Selling is associated
to the so- called “Production and Sales Eras of Marketing”. Slogans: “Make what
you can make” and “Get rid of what you have made” describe the traditional view of
marketing/selling.

• SALES VERSUS MARKETING

 Marketing is everything that you do to reach and persuade

prospects.
 Sales process is everything that you do to close the sale and get a
signed agreement or contract.
(Both are necessities to the success of a business. You cannot do
without either process. By strategically combining both efforts you
will experience a successful amount of business growth. However, by
the same token if the efforts are unbalanced it candetour your growth.)
 Sales: Building Relationships

Sales roles are about one-on-one relationships-from prospecting to

closing a deal and all the phone calls in between. Wherever customers are
in the sales process, salespeople convince them to take the next step. And,
for salespeople, successful relationships help breed more business through
referrals and networking.
 Marketing: planning and tactics

Marketing is a business support function that paves the way for

sales with promotional materials and an understanding of target audiences.
Marketing plans, which may include sales strategies, are created at the
executive level to guide more junior marketers in executing tactics,
including ads, web pages, print brochures and more.

• THE MARKETING PROCESS

The marketing of companies are typically focused on four specific aspects

 Customer focused
 Competitor focused
 Interfunctional coordination
 Profit orientation
 The Marketing Process

Situation Analysis
|
V
Marketing Strategy
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V
Marketing Mix Decisions
|
V
Implementation & Control

Situation Analysis

A thorough analysis of the situation in which the firm finds itself serves as the basis for
identifying opportunities to satisfy unfulfilled customer needs. In addition to identifying
the customer needs, the firm must understand its own capabilities and the environment in
which it is operating.

The situation analysis should include past, present, and future aspects. It should include a
history outlining how the situation evolved to its present state, and an analysis of trends
in order to forecast where it is going. Good forecasting can reduce the chance of spending
a year bringing a product to market only to find that the need no longer exists.

If the situation analysis reveals gaps between what consumers want and what currently is
offered to them, then there may be opportunities to introduce products to better satisfy
those consumers. Hence, the situation analysis should yield a summary of problems and
opportunities. From this summary, the firm can match its own capabilities with the
opportunities in order to satisfy customer needs better than the competition.

II. Marketing Strategy

Once the best opportunity to satisfy unfulfilled customer needs is identified, a strategic
plan for pursuing the opportunity can be developed. Market research will provide specific
market information that will permit the firm to select the target market segment and
optimally position the offering within that segment.

III. Marketing Mix Decisions

Detailed tactical decisions then are made for the controllable parameters of the marketing
mix. The action items include:
 Product development - specifying, designing, and producing the first units of the
product.
  Pricing decisions
 Distribution contracts
 Promotional campaign development

IV. Implementation and Control

At this point in the process, the marketing plan has been developed and the product has
been launched. Given that few environments are static, the results of the marketing effort
should be monitored closely. As the market changes, the marketing mix can be adjusted
to accomodate the changes. Often, small changes in consumer wants can addressed by
changing the advertising message. As the changes become more significant, a product
redesign or an entirely new product may be needed. The marketing process does not end
with implementation - continual monitoring and adaptation is needed to fulfill customer
needs consistently over the long-term.

• KEY ELEMENTS IN MARKETING

MARKETER- those who plan and implement marketing programs

 Market
 Environment
 Customers
 Product or services
 Promotion and Communication
 Pricing strategy
 Placement (distribution)

• MARKET MIX (OR THE FOUR P’S)

The original 4 P's of marketing

 Product – The products or services offered to your customer: Their physical

attributes, what they do, how they differ from your competitors and what
benefits they provide.
 Price – How you price your product or service so that your price remains
competitive but allows you to make a good profit. How price plays a role in
your marketing strategy with respect to differentiating your products or
services from your competitors'.
 Place (Also referred to as Distribution) – Where your business sells its
products or services and how it gets those products or services to your
customers. May also be used in your marketing strategy to differentiate you
from your competition.
 Promotion – The methods used to communicate the features and benefits of
your products or services to your target customers.
• MARKET FORECAST

A market forecast is a core component of a market analysis. It projects the future

numbers, characteristics, and trends in your target market. A standard analysis shows
the projected number of potential customers divided into segments.
Barnett (1988) emphasizes that the key to successfully forecasting market size is
to understand the underlying forces behind the demand.
1. define the market
2. segment the market
3. determine the segment drivers and model its changes
4. conduct a sensitivity analysis

• MARKET SEGMENTATION

Market segmentation is a strategy that involves dividing a larger market into

subsets of consumers who have common needs and applications for the goods and
services offered in the market. These subgroups of consumers can be identified by a
number of different demographics, depending on the purposes behind identifying the
groups. Marketing campaigns are often designed and implemented based on this type
of customer segmentation.

Market segmentation strategies can be developed over a wide range of

characteristics found among consumers. One group within the market may be
identified by gender, while another group may be composed of consumers within a
given age group. Location is another common component in market segmentation, as
is income level and education level. Generally, there will be at least a few established
customers who fall into more than one category, but marketing strategists normally
allow for this phenomenon.

Along with playing a role in the development of new marketing approaches to

attract a certain demographic within the market base, market segmentation can also
help a company understand ways to enhance customer loyalty with existing
customers. As part of the process of identifying specific groups within the larger
client base, the company will often ask questions that lead to practical suggestions on
how to make the products more desirable to customers. This activity may lead to
changes in packaging or other similar changes that do not impact the core product.
However, making a few simple changes in the appearance of the product sends a clear
message to consumers that the company does listen to customers. This demonstration
of good will can go a long way to strengthen the ties between consumer and vendor.

 PURPOSE OF MARKET SEGMENTATION

 One of the main reasons for engaging in market segmentation is to
help the company understand the needs of the customer base. Often the task of
segregating consumers by specific criteria will help the company identify
other applications for their products that may or may not have been self
evident before. Uncovering these other ideas for use of goods and services
may help the company target a larger audience in that same demographic
classification and thus increase market share among a specific sub market
base.

 STEPS IN MARKETING SEGMENTATION

(Everyone within the Marketing world knows and speaks of

segmentation yet not many truly understand its underlying mechanics, thus
failure is just around the corner. What causes this? It has been documented
that most marketers fail the segmentation exam and start with a narrow mind
and a bunch of misconceptions such as "all teenagers are rebels", "all elderly
women buy the same cosmetics brands" and so on. There are many
dimensions to be considered, and uncovering them is certainly an exercise of
creativity.)

STEP 1: Identify and name the broad market

You have to have figured out by this moment what broad market your
business aims at. If your company is already on a market, this can be a starting
point; more options are available for a new business but resources would
normally be a little limited.

STEP 2: Identify and make an inventory of potential customers' needs

This step pushes the creativity challenge even farther, since it can be
compared to a brainstorming session.

What you have to figure out is what needs the consumers from the
broad market identified earlier might have. The more possible needs you can
come up with, the better.

Got yourself stuck in this stage of segmentation? Try to put yourself

into the shoes of your potential customers: why would they buy your product,
what could possibly trigger a buying decision? Answering these questions can
help you list most needs of potential customers on a given product market.

STEP 3: Formulate narrower markets

McCarthy and Perreault suggest forming sub-markets around what you

would call your "typical customer", then aggregate similar people into this
segment, on the condition to be able to satisfy their needs using the same
Marketing mix. Start building a column with dimensions of the major need
you try to cover: this will make it easier for you to decide if a given person
should be included in the first segment or you should form a new segment.
Also create a list of people-related features, demographics included, for each
narrow market you form - a further step will ask you to name them.

There is no exact formula on how to form narrow markets: use your

best judgment and experience. Do not avoid asking opinions even from non-
Marketing professionals, as different people can have different opinions and
you can usually count on at least those items most people agree on.

STEP 4: Identify the determining dimensions

Carefully review the list resulted form the previous step. You should
have by now a list of need dimensions for each market segment: try to identify
those that carry a determining power.

Reviewing the needs and attitudes of those you included within each
market segment can help you figure out the determining dimensions.

STEP 5: Name possible segment markets

You have identified the determining dimensions of your market

segments, now review them one by one and give them an appropriate name.

A good way of naming these markets is to rely on the most important

determining dimension.

STEP 6: Evaluate the behavior of market segments

Once you are done naming each market segment, allow time to
consider what other aspects you know about them. It is important for a
marketer to understand market behavior and what triggers it. You might notice
that, while most segments have similar needs, they're still different needs:
understanding the difference and acting upon it is the key to achieve success
using competitive offerings.

STEP 7: Estimate the size of each market segment

Each segment identified, named and studied during the previous stages
should finally be given an estimate size, even if, for lack of data, it is only a
rough estimate.

Estimates of market segments will come in handy later, by offering a

support for sales forecasts and help plan the Marketing mix: the more data we
can gather at this moment, the easier further planning and strategy will be.
 These were the steps to segment a market, briefly presented. If
performed correctly and thoroughly, you should now be able to have a
glimpse of how to build Marketing mixes for each market segment.

This 7 steps approach to market segmentation is very simple and

practical and works for most marketers. However, if you are curious about
other methods and want to experiment, you should take a look at computer-
aided techniques, such as clustering and positioning.

As a practice, it consists in coordination of four elements called 4P's: (1)

identification, selection, and development of a product, (2) determination of
its price, (3) selection of a distribution channel to reach the customer's place,
and (4) development and implementation of a promotional strategy. Marketing
differs from selling because (in the words of Harvard Business School's
emeritus professor of marketing Theodore C. Levitt) "Selling concerns itself
with the tricks and techniques of getting people to exchange their cash for
your product. It is not concerned with the values that the exchange is all about.
And it does not, as marketing invariably does, view the entire business process
as consisting of a tightly integrated effort to discover, create, arouse, and
satisfy customer needs."

Marketing is the process of interesting potential customers and clients in

your products and/or services.

The key word in this marketing definition is "process"; marketing involves

researching, promoting, selling, and distributing your products or services.

It's a huge topic, which is why there are tomes written on marketing, and
why you can take a four-year marketing degree. But essentially marketing
involves everything you do to get your potential customers and your product
or service together.

When you're putting together a marketing program for your business,

concentrate on the marketing basics, the four key components of any
marketing plan:
products and services
promotion
distribution
 pricing.

The name of the game in marketing is attracting and retaining a growing

base of satisfied customers. Creating and implementing a marketing plan will
keep your marketing efforts focused and increase your marketing success.