2 What is Marketing?? Selling? Advertising? Promotions? Making products available in stores? Maintaining inventories?
All of the above, plus much more! 3 Marketing = ? Marketing is the process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods, services to create exchanges that satisfy individual and organizational goals American Marketing Association 4 Marketing = ? 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. 5 Simple Marketing System Industry (a collection of sellers) Market (a collection of Buyers) Goods/services Money Communication Information 6 Marketing = ? Marketing is the sum of all activities that take you to a sales outlet. After that sales takes over. Marketing is all about creating a pull, sales is all about push. Marketing is all about managing the four Ps product price place promotion 7 The 4 Ps & 4Cs Marketing Mix Product Price Promotion Place Customer Solution Customer Cost Communication Convenience 8 Difference Between - Sales & Marketing ? Sales trying to get the customer to want what the company produces Marketing trying to get the company produce what the customer wants
9 Scope What do we market Goods Services Events Experiences Personalities Place Organizations Properties Information Ideas and concepts 10 Core Concepts of Marketing Based on : Needs, Wants, Desires / demand Products, Utility, Value & Satisfaction Exchange, Transactions & Relationships Markets, Marketing & Marketers.
11 Needs, wants demands Markets Marketing & Marketers Utility, Value & Satisfaction Xchange, Transaction Relationships Products Core Concepts of Marketing 12 Core Concepts of Marketing Need food ( is a must ) Want Pizza, Burger, French fry's ( translation of a need as per our experience ) Demand Burger ( translation of a want as per our willingness and ability to buy ) Desire Have a Burger in a five star hotel 13 In order to understand Marketing let us begin with the Marketing Triangle Customers Competition Company 14 Who is a Customer ??
Anyone who is in the market looking at a product / service for attention, acquisition, use or consumption that satisfies a want or a need CUSTOMER IS . . . . .
15 Customer CUSTOMER has needs, wants, demands and desires Understanding these needs is starting point of the entire marketing These needs, wants arise within a framework or an ecosystem Understanding both the needs and the ecosystem is the starting point of a long term relationship
16 How Do Consumers Choose Among Products & Services? Value - the value or benefits the customers gain from using the product versus the cost of obtaining the product. Satisfaction - Based on a comparison of performance and expectations. Performance > Expectations => Satisfaction Performance < Expectations => Dissatisfaction 17 Customers - Problem Solution As a priority , we must bring to our customers WHAT THEY NEED We must be in a position to UNDERSTAND their problems Or in a new situation to give them a chance to AVOID the problems 18 Customer looks for Value Value = Benefit / Cost Benefit = Functional Benefit + Emotional Benefit Cost = Monetary Cost + Time Cost + Energy Cost + Psychic Cost 20 Strategic Marketing Strategic marketing management is concerned with how we will create value for the customer Asks two main questions What is the organizations main activity at a particular time? Customer Value What are its primary goals and how will these be achieved? how will this value be delivered
21 Strategic Planning Strategic Planning is the managerial process of creating and maintaining a fit between the organizations objectives and resources and the evolving market opportunities.
Also called Strategic Management Process All organizations have this Can be Formal or Informal 22
The Strategic-Planning, Implementation, and Control Process 23 Business Strategic-Planning Process External environment (Opportunity & Threat analysis) Internal Environment (Strength/ Weakness analysis) Goal Formulation Business Mission 24 Strategy Formulation Environmental Analysis Internal Analysis Competitor Customer Supplier Regulatory Social/ Political
Technology Know-How Manufacturing Know-How Marketing Know-How Distribution Know-How Logistics Strength & Weaknesses Identity Core Competencies Opportunities & Threats Identify opportunity Fit internal Competencies with external opportunities Firm Strategies 25 The Marketing Plan A written document that acts as a guidebook of marketing activities for the marketing manager 26 CONTENTS of MARKETING PLAN Business Mission Statement Objectives Situation Analysis (SWOT) Marketing Strategy Target Market Strategy Marketing Mix Positioning Product Promotion Price Place Distribution People Process Implementation, Evaluation and Control 27 The Marketing Process Business Mission Statemen t Objective s Situation or SWOT Analysis Implementation Evaluation, Control Target Market Strategy Marketing Strategy Product Promotion Place/Distribution Price Marketing Mix Marketing Environment 29 Why a product like radio declined and now once again emerging as an entertainment medium ?
30 What Were the Drivers of This Change ? Technology ? Government policy ? Other media substitutes ? 31 Why Market Leaders Suffered ? HMT vs. Titan HLL vs. Nirma Bajaj vs. Honda Dot.com boom, then bust and now resurgence Market leadership today cannot be taken for granted.New and more efficient companies are able to upstage leaders in a much shorter period.
32 Factors Influencing Companys Marketing Strategy 33 Demographics Social Change Economic Conditions Political & Legal Factors Technology Competition Environmental Scanning Target Market Product Distribution Promotion Price External Environment is not controllable Ever-Changing Marketplace External Marketing Environment Physical / Natural 34 The macro-environment is the assessment of the external forces that act upon the firm and its customers, that create threats & opportunities 35 P r o d u c t
36 Anything that is offered to the market for attention, acquisition, use or consumption that satisfies a want or a need Product is . . . . . 37 Types of Products Consumer Products Industrial Products PRODUCTS Services 38 Product Items, Lines, and Mixes Product Item Product Line Product Mix A specific version of a product that can be designated as a distinct offering among an organizations products. A group of closely-related product items. All products that an organization sells. 39 Product Mix Width how many product lines a company has Length how many products are there in a product line Depth how many variants of each product exist within a product line Consistency how closely related the product lines are in end use 40 Gillettes Product Lines & Mix Blades and Writing razors Toiletries instruments Lighters Fusion 5 blade Mach 3 Turbo Mach 3 Series Paper Mate Cricket Sensor Adorn Flair S.T. Dupont Trac II Toni S.T. Dupont Atra Right Guard Swivel Silkience Double-Edge Soft and Dri Lady Gillette Foamy Super Speed Dry Look Twin Injector Dry Idea Techmatic Brush Plus
Width of the product mix D e p t h
o f
t h e
p r o d u c t
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41 What is a Service? Defining the Essence An act or performance offered by one party to another (performances are intangible, but may involve use of physical products) An economic activity that does not result in ownership A process that creates benefits by facilitating a desired change in customers themselves, or their physical possessions, or intangible assets 42 Some Industries - Service Sector Banking, stock broking Lodging Restaurants, bars, catering Insurance News and entertainment Transportation (freight and passenger) Health care Education Wholesaling and retailing Laundries, dry-cleaning Repair and maintenance Professional (e.g., law, architecture, consulting)
43 Classification of Services Pure Tangible Product Materials / Components Computers Major Product with Minor Services Product = Service Major Service with Minor Product Business Hotels Good Transportation Banking Pure Intangible Service 44 Intangibility Services are intangibility cannot be seen, tasted, felt, heard or smelled before purchase. Inseparability - Services are produced and consumed simultaneously. Variability or Heterogeneity Services are highly variable Perishability Services cannot be stored. Non Ownership - Services are rendered but there is no transfer of title
Major Characteristic of Services 45 The Marketing Mix The conventional view of the marketing mix consisted of four components (4 Ps): Product, Price, Place/ distribution and Promotion. Generally acknowledged that this is too narrow today; now includes , Processes, Productivity [technology ]People [employees], Physical evidence Marketers today are focused on virtually all aspects of the firms operations that have the potential to affect the relationship with customers. 46 The 8Ps of Integrated Service Management vs. the Traditional 4Ps Product elements Place, cyberspace, and time Process Productivity and quality People Promotion and education Physical evidence Price and other user outlays 47 The Give and Get of Marketing 48 Great Words on Marketing 1. The purpose of a company is to create a customerThe only profit center is the customer. 2. A business has twoand only twobasic functions: marketing and innovation. Marketing and innovation produce results: all the rest are costs. 3. The aim of marketing is to make selling unnecessary. 4. While great devices are invented in the Laboratory, great products are invented in the Marketing department. 5. Marketing is too important to be left to the marketing department.
49 Drivers of Customer Satisfaction Many aspects of the firms value proposition contribute to customer satisfaction: The core product or service offered Support services and systems The technical performance of the firm Interaction with the firm and it employees The emotional connection with customers Ability to add value and to differentiate as a firm focuses more on the top levels 50 Marketers and Markets Marketers are focused on stimulating exchanges with customers who make up markets B2C or B2B. The market is comprised of people who play a series of roles: decision makers, consumers, purchasers, and influencers. It is absolutely essential that marketers have a detailed understanding of consumers, their needs and wants. Much happens before and after the sale to affect customer satisfaction 51 Stages of Customer Interaction 52 What Changed in Marketing Organize by product units Focus on profitable transactions Look primarily at financial scorecard Focus on shareholders Marketing does the marketing Build brands through advertising Focus on customer acquisition No customer satisfaction measurement Over-promise, under-deliver Organize by customer segments Focus on customer lifetime value Look also at marketing scorecard
Focus on stakeholders Everyone does the marketing Build brands through performance Focus on customer retention Measure customer satisfaction and retention rate Under-promise, over-deliver Old Economy New Economy 53 Are Banks truly marketing-savvy and customer - centric? 54 Myth 1 The larger the range of products, the more customer-centric I am.
Mythbuster The range of products has emerged from being competition-centric. 55 Myth 2 Better technology (read CRM) leads to better customer service. Mythbuster Technology alone does not deliver, helps people do. 56 Myth 3 Launch a product and the customer will start using instantly. - Give a customer a card and he will learn how to play with it immediately Mythbuster Customers need To be educated too 57 Mythbuster Customers are not only present where competition is. Myth 4 The only way to get a customer is from competition. 58 Myth 5 Just advertise and - You will sell. Mythbuster Advertising will only sell, Not retain customers. 59 Myth 6 No difference between marketing & selling Mythbuster Selling focuses on the needs of the seller; marketing on the needs of the buyer. 60 Myth 7 In the absence of relationships trust builds financial brands Mythbuster Trust is not a differentiator at all it is the very minimum that the customer expects!! 61 So what will the differentiators be : Technology ?
Brand ?
62 The real differentiator of customer centricity in a commoditised world of financial products - Customer Service !