MARKETING MANAGEMENT

AN INTRODUCTION

COVERAGE
DEFINITION OF MARKETING AND MARKETING MANAGEMENT EVOLUTION OF MARKETING MARKETING CONCEPTS MARKETING MIX MARKETING CHALLENGES FOR 21 CENTURY

WHAT IS MARKETING?
Marketing is the management process that identifies, anticipates and satisfies customer requirements profitably. Marketing ensures that the right product/ services are made available at the right place at the right time and at the right price. Marketing is the human activity directed at satisfying human needs and wants through an exchange process.

MARKETING PROCESS (FIG 1.1 PAGE 5)

UNDERSTAND THE MARKETPLACE AND CUSTOMER NEEDS AND WANTS

DESIGN A CUSTOMER DRIVEN MARKETING STRATEGY

CONSTRUCT AN INTEGRATED MARKETING PROGRAM THAT DELIVERS SUPERIOR VALUE

BUILD PROFITABLE RELATIONSHIPS AND CREATE CUSTOMER DELIGHT

CAPTURE VALUE FROM CUSTOMERS TO CREATE PROFITS AND CUSTOMER EQUITY

DEFINITION OF MARKETING

MEETING NEEDS PROFITABILY Marketing is a process of planning, executing the conception, pricing, promotion and distribution of ideas, goods and services and to create exchanges that satisfy individual and organisational goals.

DEFINITION OF MARKETING MANAGEMENT

Marketing management is the art and science of choosing target markets and getting, keeping and growing customers through creating, delivering and communicating superior customer value.

SOCIAL DEFINITION OF MARKETING MANAGEMENT

Marketing is a societal process by which individuals and groups obtain what they need and want through creating, offering and freely exchanging products and services of value with others.

MANAGERIAL DEFINITION OF MARKETING MANAGEMENT The aim of marketing is to know and understand the customer so well that the product or service fits him/her and sells itself. Ideally marketing should result in a customer who is ready to buy.

WHAT IS MARKETED?
GOODS SERVICES EVENTS EXPERIENCES PERSONS

PLACE ORGANISATION PROPERTY INFORMATION IDEAS

EVOLUTION OF MARKETING

PRODUCTION ERA (Produce as much as possible)

SALES ERA
(Convince customers to buy what marketers have)

MARKETING ERA (Give customers what they want)

EVOLUTION OF MARKETING: PRODUCTION ERA

Begins with industrial revolution in the 17th century and continued till 1920s. SAYS LAW: Supply creates its own demand. Demand for products more than the supply, thus led to sellers markets. Aim was to manufacture products faster and at a lower price. Customers concern was mainly on the availability of product. No importance was given to features or quality of the product

EVOLUTION OF MARKETING: SALES ERA

Started from 1920s and continued till mid 1950s. Era saw the great depression of 1923. Depression proved manufacturing was not everything, but the sale of product was also important to make profits. Gave rise to promotion and distribution strategies emerged to sell products. Advertising of products was done to increase sales. Market research came into picture.

EVOLUTION OF MARKETING: MARKETING ERA

1970s till now. Focused on importance of customer . Products designed as per the needs of the customer. Development of customer-centered activities over the production and selling activities. Techniques such as Customer survey , to collect and analyse data for understanding customers expectations , wants and needs.

SOME OF THE CONCEPTS / TERMINOLOGIES

Marketing and selling Market / needs and wants/exchange /demand and value 4Ps of Marketing Market segmentation, targeting and positioning (STP)

CONCEPTS OF MARKETING
Do you think marketing and selling are one and the same? Marketing is the art of selling products, but, considering the most important part of marketing is not selling.

DIFFERENCES BETWEEN SELLING AND MARKETING

S no
1 2

SELLING
BEGINS WITH THE PRODUCT FOCUSES ON THE NEEDS AND WANTS OF THE SELLER PROCESS ENDS WITH THE DELIVERY OF PRODUCT

MARKETING
BEGINS WITH THE CUSTOMER FOCUSES ON THE NEEDS AND WANTS OF THE CUSTOMER. PROCESS CONTINUES EVEN AFTER THE DELIVERY OF PRODUCT

SELLING IS A PART OF MARKETING PROCESS

MARKETING BUILDS THE PLATFORM FOR MAKING SALES.

SELLING IS A PROCESS THAT MAINLY MARKETING IS A PROCESS THAT FOCUSES ON CLOSING THE SALES. MAINLY FOCUSES ON CUSTOMERS NEEDS AND WANTS. IT IS SHORT TERM PROCESS IT IS LONG TERM PROCESS

CORE MARKETING CONCEPTS

1. Market 2. Needs and wants 3. Exchange 4. Demand 5. Value

1. MARKET
Market is a place where buyer meets the seller. Types of markets Consumer markets: soft drinks, tooth paste, Business market: B2B Global Markets: KFC, McDonalds, Rebook, .. Non profit & Govt markets : Ration shops..

2. NEEDS AND WANTS

Needs: Human need is a state of felt deprivation of some basic satisfaction. Wants: Wants are desires of specific satisfiers of these deeper needs.

DIFFERENCE BETWEEN NEED AND WANTS

NEED
ROLE OF MARKETER NEED IS PRE-EXISTING IN NATURE MARKETER IDENTIFIES THE NEED OF A CUSTOMER

WANT
WANT FOR A PRODUCT IS CREATED BY MARKETING A MARKETER INFLUENCES WANTS AND CREATES THEM BY PRODUCING THE PRODUCTS McDONALDS BURGER

EXAMPLES

HUNGER

TRANSPORT

HONDA CITY

TYPES OF NEEDS
STATED NEED REAL NEEDS UNSTATED NEEDS DELIGHT NEEDS SECRET NEEDS

TYPES OF NEEDS
STATED NEED: Customer states the need to the marketer. REAL NEEDS: Actual need of a customer UNSTATED NEEDS: Involves a need that a customer does not tell the marketer. It is also known as latent need. DELIGHT NEEDS: Involves expectations of a customer from a marketer. SECRET NEEDS: Includes the esteem needs of a customer in a society.

3. EXCHANGE
There has to be two parties : Buyer and a seller Buyer should have the need (demand) Seller should have the product (supply) Both should be willing to exchange for a price agreed to both parties.

4. VALUE
Customer pays for the product, which is the price. Price is not equal to value. Value is defined as the ratio of what customer get and what they give in return. Value = Benefits / Price Value = Quality received /expectations Value = Benefits cost Value is what has been perceived by the customer.

5. DEMAND
1. 2. 3. 4. 5. 6. 7. 8. Negative demand No Demand Latent Demand Declining Demand Irregular Demand Full Demand Overfull Demand Unwholesome Demand

5. DEMAND ..
1. Negative demand: Disliking for a product by the
customer Ex : Demand for air travel becomes negative when the ticket price increase.

2. No Demand: non existent demand for a product by the

customer.

3. Latent Demand: Existing product is not satisfying the

demand of the customer.

4. Declining Demand: Falling or decreasing demand

5. DEMAND
5. Irregular Demand: Demand varies according to
season or festive.

6. Full Demand: Demand equal to the supply. (desired

level )

7. Overfull Demand: Demand

supply .

for a product exceeds its

8. Unwholesome Demand: Demand for a product has

undesirable social consequences.

CONCEPTS OF MARKETING
a)

b)
c) d) e)

The Production Concept The Product Concept The Selling Concept The Marketing Concept The Societal Concept

1. PRODUCTION CONCEPT:
Oldest concept. Useful in the following cases: a) High supply at low costs. b) Competition is less and demand is more than the supply c) Customers are more interested in the products rather than its features or attributes. d) When a new product is launched e) When the taste of the consumer does not alter.

2. THE PRODUCT CONCEPT

Product concept focuses on quality, features, attribute of product Consumer favors products offering high quality, performance and innovative features. Marketing strategy focuses on superior products and making continuous improvements. Product concept might also lead to marketing myopia. Thus companies need to take innovations and features seriously and provide only those which the customer needs. The customer needs should be given priority.

3. SELLING CONCEPT
Aggressive selling and promotional efforts by the organisation. Aim is to sell what the organisation makes and ignores what the customer wants. It is ok for short run and fails in long run. Organisation goes for this concept, when they have excess supply of product

4. MARKETING CONCEPT
Customer is the KING Instead of make and sell philosophy business shifted to a customer-centered, sense and respond philosophy. Involves

Customer

orientation: Satisfying the needs of the customers. Organisational integration: All areas of organisation working
together to achieve organisational goals.

Profit

orientation: Generating profits by satisfying the needs of the

customers

5. SOCIETAL CONCEPT
Organisation

is the part of the society.

Organisation

returns a part of its profit to the society in the form of Corporate social responsibility concept pays profits in long run.

Societal

CORE MARKETING CONCEPTS . 4PS Marketing mix: A business tool used in marketing the products or services.

4PS OF MARKETING MIX

PRODUCT
Variety Quality Design Features Brand name Packaging Services

(FIG 2.5 PAGE 46)

PRICE
List price Discounts Allowances Payment period Credit terms

TARGET CUSTOMERS

PROMOTION
Advetising Personal selling Sales Promotion Public relations

INTENDED POSITIONING

PLACE
Channels Coverage Assortments Locations Inventory Transportation Logistics

The Marketing mix (or the 4 Ps) consists of tactical marketing tools, blended into an integrated marketing program that actually delivers the intended value proposition to target customers

STP
SEGMENTATION TARGETING POSITIONING

EXTENDED 7pS OF SERVICES MARKETING MIX

CHANNELS OF DISTRIBUTION

MARKETING IN THE 21ST CENTURY

New consumer capabilities:

o Substantial increase in buying power o Greater variety of goods and services o A great amount of information on practically anything o Greater ease in interacting and placing and receiving orders o An amplified voice to influence peer and public opinion

MARKETING IN THE 21ST CENTURY

Societal forces:
o Information Technology o Globalization o Deregulation o Privatization o Heightened Competition o Industry Convergence o Disintermediation

MARKETING IN THE 21ST CENTURY

New

company capabilities:

1. Internet as an information and sales channel. 2. Market Research 3. Internal Communication among employees 4. External communication for customers. 5. Extranets linking suppliers and distributors 6. Corporate Blogging 7. Online recruitments and training for employees.

MARKETING PROCESS (FIG 1.6 PAGE 29)

UNDERSTAND THE MARKETPLACE AND CUSTOMER NEEDS AND WANTS DESIGN A CUSTOMER DRIVEN MARKETING STRATEGY CONSTRUCT AN INTEGRATED MARKETING PROGRAM THAT DELIVERS SUPERIOR VALUE BUILD PROFITABLE RELATIONSHIPS AND CREATE CUSTOMER DELIGHT CAPTURE VALUE FROM CUSTOMERS TO CREATE PROFITS AND CUSTOMER EQUITY

Research customers & market place Manage marketing information and customer data

Select customers to serve: Market segmentatio n and targeting Decide on value proposition:
Differentiation and positioning

Product and service design: build strong brands

Customer relationship management :

Build strong relationship with customers

Create satisfied, loyal customers Capture customer lifetime value Increase share of market and share of customer

Pricing: create real value

Distribution: manage demand and supply chains

Partner relationship management :

Build strong relationship with partners

Promotion:
Communicate the value proposition