By, N. K.

Upamannyu

Marketing is the process of building profitable customer relationship by creating value for customer and capturing value in return.

Marketing is an organizational function and set of processes for creating, communicating and delivering value to customer relationship in ways that benefit the organization and its stakeholders. (American Marketing Association)

Marketing is The process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods, and services to create exchanges that satisfy individual and organizational objectives. - American Marketing Association Definition

Marketing is the art of delivering right goods to the right person, at the right time, at the right price, at the right place through the right distribution system. By, R.C . Agarwal The success of business organization does not depend on, that how much quantity of goods are being produced by the organization rather than it depends on how much quantity of good are being sold.

In modern age, Manager says that we do not manufacture product rather than we manufacture customer. Therefore it is correctly said marketing is the art of delivering goods to the end user consumer.

Marketing is not new term for us. Even most of the person understand that they are well aware from this word but in fact most of the people do not understand the actual meaning of marketing. Even people those who are involved or engaged in the activity of marketing they also takes wrong meaning or marketing. Even a seller or manager understand marketing is only selling. In fact the term of marketing is very much popular therefore people understand they know about the marketing very well.

Even illiterate farmer also feel that he is having very much information about the marketing. He takes meaning from the term marketing to sale his crop in market that is marketing from his point of view. A housewife understands the marketing term in her point view that whatever domestic buying is done by her that is marketing.

Marketing is the social process by which individuals and groups obtain what they need and want through creating and exchanging products and value with others. (Kotler) Marketing is the management process that identifies, anticipates and satisfies customer requirements profitably. The Chartered Institute of Marketing (CIM). The right product, in the right place, at the right time, at the right price. (Adcock). Marketing is essentially about marshalling the resources of an organization so that they meet the changing needs of the customer on whom the organization depends. (Palmer).

Create value for customers and build customer relationships

Capture value
customers in return
Build profitable relationships and create customer delight
Capture value from customers to create profits and customer quality

from

Understand the marketplace and customer needs&wants

Design a customerdriven marketing strategy

Construct a marketing program that delivers superior value

Research Consumer and The market place Manage marketing information and customer data

Select consumer to serve- Market Segmentation and Targeting Value Proposition Differentiation and Positioning

Understand the marketplace and customer needs&wants

Design a customerdriven marketing strategy

Product and service Design Build strong Brands Price- Create real value Place- Manage Demand and supply chain Promotion- create the value proposition

Customer Relationship Management- With chosen customer Product Relationship Management- With chosen suppliers

Construct a marketing program that delivers superior value

Build profitable relationships and create customer delight

Capturing value from customers in return 1. Generate Revenue, Earn Profit 2. Create Loyal, Satisfied customer 3. Capture customer Lifetime value 4. Increase Market Share

Needs, wants, and demands

Markets

Products and services

Exchange, transactions, and relationships

Value and satisfaction

Needs, wants, and demands Marketing offers: including products, services and experiences Value and satisfaction Exchange, transactions and relationships Markets

Need a need is something you have to have, something can not be avoided. Wants A want is something you would like to have , it is not absolutely necessary. Demands
Example: Luxurious product Example: Food, Clothe, Shelter etc

Wants which are directed by buying power

Needs, wants, and demands Marketing offers: including products, services and experiences Value and satisfaction Exchange, transactions and relationships Markets

Marketing offering
Combination of products, services, information or experiences that satisfy a need or want of the consumer. Offer may include services, activities, people, places, information or ideas

Marketing ideas
(social marketing)
This is the watch Stephen Hollingshead, Jr. was wearing when he encountered a drunk driver. Time of death 6:55 p.m.

Friends Dont Let Friends Drive Drunk

Needs, wants, and demands Marketing offers: including products, services and experiences Value and satisfaction Exchange, transactions and relationships Markets

Value
Customers expectations regarding product and service. Marketers must deliver value to consumers

Satisfaction
A satisfied customer will buy again and tell others about their good experience

Needs, wants, and demands Marketing offers: including products, services and experiences Value and satisfaction Exchange, transactions and relationships Markets

Exchange The act of obtaining a desired object from someone by offering something in return Transaction Trade of values between two or more parties
relationships with several exchanges are the goal

One exchange is not the goal,

Relationships are built through delivering value and satisfaction

Marketing network consists of the company and all iits supporting stakeholders

1.

Give one thing and take back another thing. The worth of things does not matter. Each party has something that might be of value to the other party. Each party is free to accept or reject the exchange offer.

1.

Transaction is to transfer of a tangible thing against cash. Transfer of equal value able things or cash. Overcharge if possible. Transaction involves: agreed-upon conditions a time of agreement and a place of agreement

2.

2.

3.

3.

4.

4.

Needs, wants, and demands Marketing offers: including products, services and experiences Value and satisfaction Exchange, transactions and relationships Markets

Market
Set of actual and potential buyers of a product Marketers seek buyers that are profitable

Communication

(a collection of sellers)

Industry

Products/services Money

(a collection of Buyers)

Market

Information

Marketing management the art and science

of choosing target markets and building profitable relationships with them.
This definition must include answers to 2 questions: What customers will we serve? How can we serve these customers best? Getting, keeping, and growing customers through creating, delivering, and communicating superior customer value

Marketing management involves managing demand involves managing customer relationships

Marketing management can be defined in broader terms as demand management;

Marketers aim to influence the level, timing and composition of demand to meet organizational goals.

Marketing management is concerned

not only with finding and increasing demand, but also with changing or even reducing it : demarketing!

How marketing has become marketing as we understand it and apply its practices today?

Trade has existed since when man was capable to produce a surplus. The first method of this kind of trade is called the Barter System. This means exchanging goods with one another. During the 1800 the world was facing industrial revolution, this means that people where shifting from agriculture to industrial products this brought about opening of different factories. People increased their income and there was a corresponding increase in demand for product. In other words, the producer had an advantage over the consumer in those days since whatever was produced was being demanded.

PRODUCTION

PRODUCT

SALES

SOCIAL MARKETING

MARKETING

Production Era (1850s-1920s)

Sales Era (1920s-1950s)
Industrial revolution; mass production Few products and little competition

The focus was on personal selling and advertising Sales seen as the major means for increasing profits

Mktg Era (1950s-present)

Customer orientation replaced the hard sell of the sales-led era Determination of the needs and wants of customers before introducing products or services

Relationship Marketing Era: 1990s Marketing era has recently shifted from being transaction-based to focusing on relationships The argument traditional marketing practices focused on attracting new customers rather than retaining existing ones. It is equally important to hang on to existing customers so that they become repeat buyers and long term loyal customers
customer relationship management!

Consumers will favor those products that are widely available and low in cost. Managers concentrate on achieving high

production efficiency and wide distribution.

The assumption is valid at least in 2 situations : The demand for a product exceeds supply (suppliers will concentrate on finding ways to increase production) The products cost is high and has to be decreased to expand the market.

Consumers will favor those products that offer the most quality, performance or innovative features. Managers in product-oriented organizations concentrate on making superior products and improving them over time. The assumption the customers will admire well-made products and can evaluate product quality and performance This concept may lead to marketing

myopia

The sale concept: in the world of economic recession of the early 20th Century, we experienced unemployment and a fall in demand for goods and service. This situation resulted in excess supply and business people realized that it was not enough to simply produce goods efficiently but for profits to be made, these goods had to be sold. The sale concept stated that effective demand could be created by the used of sales techniques with the help of the sales department, the sales person and the sales manager becoming the most important people in the organization hoping to achieve profitability Politicians are a good example of people who are consciously selling themselves to the electorates.

Agressive selling and promotion

Assumptions are;
Consumers must be convinced of buying company products Company is powerful in generating effective selling and promotion to stimulate more buying

This concept is mostly used by firms which have overcapacity. The aim is to sell what they make rather than make what the market wants. Short-term profits are more important
(customer dissatisfaction may occur)

Key to achieving organizational goals consists of being more effective than competitors in creating, delivering and

communicating customer value to target markets.

4 pillars of modern marketing :

1. 2. 3. 4.

Target market Customer needs Integrated marketing Profitability through customer satisfaction

Starting point
Factory

Focus
Existing products

Means
Selling and promotion

Ends
Profits through sales volume

(a) The selling concept

Market Customer needs Integrated marketing Profits through customer satisfaction

(b) The marketing concept

Selling:Selling is short-term perspective. Starting point of selling is factory Selling focus on existing products The meaning of selling aggressive personal selling + promotion Selling ends where there would be profit trough sales volumes

Marketing is long term in perspective The starting point of marketing is market Marketing focus on customer needs The means of marketing integrated marketing communication. Marketing ends where there is profit through customer satisfaction.

1)

Target

homogenous group of customers to whom the company wishes to appeal

market

2)

Customer needs

Consumers may not be fully conscious of their needs It may not be easy to articulate these needs They may use words that require some interpretation Customer-oriented thinking to define customer needs from the customers point of view Sales revenue New customers + Repeat customers Customer Retention vs. Customer Attraction Customer satisfaction is a function of the product perceived performance and buyers expectations

3)

1. Various marketing functions must work together for customer satisfaction (coordination of 4Ps; marketing mix elements)

Integrated Marketing

puts together to satisfy its target market(s). Product: Product variety, quality, design, features, brand name, packaging, sizes, services, warranties, returns Price: List price, discounts, allowances, payment period, credit terms Promotion: Sales promotion, advertising, sales force, public relations, direct marketing Place: Channels, coverage, assortments, locations, inventory, transport

Marketing Mix controllable variables the company

Marketing Mix Product

Place

Customer Solution

Convenience
Price Promotion

Customer Cost

Communication

Integrated Marketing (cont.)

2.

Marketing must be well coordinated with other departments in the company; all departments have to work together to satisfy customers needs and wants

4)

Profitability through customer satisfaction

To achieve profits as a result of creating superior customer value

Selling Marketing...

some selling. But the aim of marketing is to make selling superfluous. The aim of marketing is to know and understand the customer so well that the product or service fits him and sells itself. Ideally, marketing should result in a customer who is ready to buy. Peter Drucker

There will always be need for

Modern Marketing Concept

Traditional Organization Chart
Top Management

Middle Management
Front-line people Customers

Modern Marketing Concept

Customers
Front-line people Middle management

Customer-Oriented Organization Chart

Top management

Relationship Marketing Concept

Customer Relationship Management the overall process of building and maintaining profitable customer relationships by delivering superior customer value and satisfaction.
It deals with all aspects of acquiring, keeping and growing customers Relationship building blocks customer value and customer satisfaction Customer retention and customer loyalty The intention to gain a greater proportion of an existing customers purchases over a long period
(increase consumer lifetime value!)

Customer Relationship Management

Capturing Value from Customers

Key Concepts

Customer Loyalty and Retention Share of Customer Customer Equity

Customer delight leads to emotional relationships and loyalty Customer Lifetime Value (CLV) shows true worth of a customer

Customer Relationship Management

Capturing Value from Customers

Key Concepts

Customer Loyalty and Retention Share of Customer Customer Equity

Share of customers purchase in a product category. Achieved through offering greater variety, cross-sell and up-sell strategies.

Customer Relationship Management

Capturing Value from Customers

Key Concepts

Customer Loyalty and Retention Share of Customer Customer Equity

The combined customer lifetime values of all current and potential customers. Measures a firms performance, but in a manner that looks to the future. Choosing the best customers is key

Societal Marketing Concept

Companys negative effects on society Conflict between consumer wants and longterm social welfare Marketing managers should be concerned with social responsibility

The societal marketing concept

Companys task is to determine needs and wants of target markets & to satisfy them more effectively and efficiently than competitors --in a way that preserves or enhances the consumers and societys well-being.

Societal Marketing Concept

(Human Welfare)

Society

Societal Marketing Concept

(Want Satisfaction)

Consumers

Company
(Profits)

Societal marketing concept holds that organization should not develop marketing strategy by only keeping customer needs and wants in mind but also consider the well being and betterment of the society Now days this marketing concept is followed by majority of organizations including MacDonalds, Unilever and Procter & gamble. This marketing strategy passes out positive message to the stakeholder, partners, Government customer and public. Those organizations working on this marketing strategy communicating the message to the world those they are not only working for the Profit but also for the well being of the society.

Example-1: Body shop: Body Shop is a cosmetic company found by Anita Roddick. The company uses only vegetable based materials for its products. It is also against testing, supports community trade, activate Self Esteem, Defend Human Rights, and overall protection of the Planet. Thus it is completely following the societal marketing Ariel: Ariel is a detergent manufactured by Procter and Gamble. Ariel runs special fund raising campaigns for deprived classes of the world specifically the developing countries. It also contributes part of its profits from every bag sold to the development of the society. British American tobacco Company: BAT is a British based Tobacco company. It was found in the year 1902. BAT is involved in working for the society in every part of the world. It conducts tree Plantation drives as part of its societal marketing strategy.

http://www.docstoc.com/docs/13908290/The-Evolution-ofMarketing

The marketing mix is the combination of variables that a business uses to carry out its marketing strategy and meet customer needs. The marketing mix variable or principle are controllable variable, which should be managed carefully and must meet the need of the defined target group.

Product

Promotion

Market

Price

Place

Product- product is first element of market mix. A product is combination of good and service that is offered to satisfy need and want of consumer. A product is anything like tangible or intangible that can be offered for purchase or use by consumer. A tangible product is one that consumer can actually touch, such as computer. An intangible product is service that can not be touched such as computer repair, income tax preparation. Apart form that product include place and ideas.

Example- state tourism department developed a new place for tourism purpose so the place is sold by the state tourism department. While driving, to bear seat belt this is idea has been promoted as a way of saving lives. Uses of 3G phone, Enjoy high speed internet etc.

Core product- Core product level can be understood in context of product for which product are manufactured. A Customer purchase a camera for capturing his memories. Actual product- all the camera capture memories. The aim is to ensure that your potential customer are. The strategy at this level organization branding, adding feature and benefit to ensure that their product offer a differential advantage from their competitors. At this level organization uses tactics that how the product can be different and better form other product of competitors.

Augmented Product- augmented component include additional service and benefit that surround the first two level. Exp- warranty or Guarantee Technical Assistance Customer Care Services.

The product lifecycle looks at the sales of a product over time

Development high costs but no sales Launch high expenditure on promotion and product development, low sales Growth sales increase and product should break-even Maturity sales stabilise, less expenditure on promotion needed, revenue & profit should be high Decline sales decline, extension strategies can be adopted or the product withdrawn

Extension strategies should maintain or increase sales. They include: Modifying the product Reducing the price Adding a feature Promoting to a different market sector

1. 2. 3.

4.

Price is the second element of marketing mix. Price is the simply amount of money that customer are willing to pay for product or service. In earlier time price was determined through a barter process between seller and buyer. In modern times pricing method and strategies have taken number of forms. Pricing should take into account the following factors. Fixed and variable cost Competition Company objective Target group and willingness to pay

Penetration pricing- where the organization sets the new price to increase sales and market share. Skimming Pricing- Where the organization set initial high price then slowly lowers the price to make the product available in wider market. The objective is to skim profit of the market. Competition Pricing- the organization sets the price in comparison of competitors price. Bundle Pricing- The organization offer bundle a group of product at reduced price. Product line pricing- The organization sets the pricing having seen different range of product at different price points. Exp-A T.V manufacturer offer different T.V with different feature of T.V

Psychological pricing- The organization sets psychological pricing having known the psychology of the customer. Exp- 0.99 paisa is charged in place of Rupees 1. Premium Pricing- The price is set high to reflect exclusiveness of the product. Exp-First class in airline service. Adidas, Reebok etc.

1. 2. 3.

4.

Pricing objective are constituted on the basis of number reason mentioned below. Profitability Volume Meeting the competition Prestige

It is not enough to have good product sold at attractive price. To generate the sales volume and profit, product benefit must be communicated to the potential customer that is promotion. Promotion is the third element of marketing mix. Promotion is a communication process that takes place between the organization and its various publics. Publics are those individual and organization that have an keen interest in what the business produces and offer for sale.

Total marketing communication programmed is called promotional mix.

Advertising

Sales Promotion

Promotion mix

Advertising- Any paid for non-personal presentation and promotion of good and service through mass media such as News-paper, Television, Magazines and Radio by an Identified sponsor.

1. 2. 3. 4. 5.

6.
7. 8.

Pioneering advertising Competitive advertising Competitors advertising Advocacy advertising Product advertising Institutional advertising Reminder advertising Cooperative advertising

Pioneering Advertising-To develop the primary demand for the product or product category. Competitive advertising- to seek to develop demand for a specific product and service. Competitor advertising- To use the advertising method wherein two or more than two product are compared on the basis of their feature. Advocacy advertising- it is an organizational approach designed to support socially activity, causes or manage such as helping for homeless children. Reminder advertising- keep a product and company name in the mind of customer through its related feature. Cooperative advertising- when wholesaler and retailer work with product manufacturer to produce a single advertising and bear the cost of advertising

Sales promotion is one of the important mix of promotion mix that mix is used as short term incentive used by the marketer to encourage customer to purchase product and services. There are three basis category of sales. 1. Consumer promotion 2. Trade promotion 3. Business promotion

Consumer Promotion- It include items as coupon, rebates, price-back, premium, rewards, point of purchase coupons, contest, sweepstake, games. Trade Promotion- It include discount and allowances directed at wholesaler and retailers. Business Promotion- It include convention and trade shows. NoteSales promotion has several advantage from other promotional tools. It include immediate customer Reponses, attract more attention and crate product awareness and increase short term sales

Public relations is a strategic communication process that builds mutually beneficial relationships between organizations and their publics The main goal of a public relations department is to enhance a company reputation among the publics. Staff that work in public relation, or as it is commonly known, PR department , they are trained to be skilled full so They are able to give presentation . The role of a public relations department can be seen as reputation protector.

Selling a product or service one to one, that is known as personal selling. Personal selling involve inter personal influence and information exchange process.

Person-to-person communication with a prospect Personal selling is a process of Developing relationships Discovering needs Matching products with needs Communicating benefits

 Products and services are more complex Competition has greatly increased Customer demand for quality, value, and service has risen sharply

 1. 2. 3. 4.

5.
6. 7. 8. 9.

There are Nine general steps in the personal selling process: Prospecting Qualifying Pre-approach Approach Presentation Demonstration Handling objection Closing Follow-up

Direct Mail- to send the direct mail through using internet. In fact, this direct mail consist of complete publicity material. Such type mail are sent to shoot the potential target in specific segment.

The fourth element of marketing mix is place. Place refers to having the right product, in the right location, at the right time to be consumed by the consumer. This proper placement of product is done through middle people called the channel of distribution. The channel of distribution is comprised of interdependency of manufacturer, Whole seller and Retailer. These group are involved with making product or service available for use of consumption.

Products should be conveniently available for customers to buy Places include:

Stores Mail order Telesales Internet

Manufacturers Wholesaler Retailer

Consumer