Basic

concepts of
Marketing
Dr M.Meher Karuna

DEFINING MARKETING

Marketing is a societal process by which

individuals and groups obtain what they need
and want through creating, offering and freely
exchanging product and services of value
with others
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.

Definition by AMA

Marketing is an organizational function and a

set of processes for creating, communicating,
and delivering value to customers and for
managing customer relationships in ways that
benefit the organization and its stakeholders.

THE SCOPE OF MARKETING

GOODS
Physical goods constitute the bulk of most countries
productions and marketing effort
SERVICES
As economics advance, a growing proportion of their
activities are focused on the production of service
EXPERIENCES
By orchestrating several service and goods, one can
create, stage and market experiences
EVENT
Marketers promote time-based events, such as the
Olympics, company anniversaries, major trade shows,
sports event and artistic performances
PERSONS
Celebrity marketing has become a major business

PLACES
Places (cities, states, regions and whole nations) compete
actively to attract tourist, factories, company, headquarters
and new residents
PROPERTIES
Properties are intangible right of ownership of either real
property (real estate) or financial property (stocks and bonds)
ORGANIZATIONS
Organizations actively work to build a strong, favorable image
in the mind of their publics
INFORMATIONS
Information can be produced and marketed as a product
IDEAS
Every market offering includes a basic idea at its core

Structure of Flows in a Modern Exchange Economy

Resources

Resource
Markets

Money

Money
Taxes,
goods

Manufacturer
Markets

Service,
Money

Service,
Money

Government
Markets

Taxes,
goods

Goods and
services

Taxes

goods
Service,
Money

Money

Resources

Taxes,
goods

Money

Intermediary
Markets
Goods and
services

Consumer
Markets

CORE MARKETING CONCEPTS

Exchange and
Target Markets
Transactions
and
Relationship and
Segmentations
Networks
Marketers and
Marketing Channels
Prospects
Supply Chain
Needs, wants and
Competition
demand
Product or Offering Marketing
Environment
Value and
Marketing Mix
Satisfication

1.
2.

Target Markets and Segmentation

Market Place, Market Space, Metamarket
Market Place: Physical Shopping
Market Space: Digital Shopping
Metamarket: Cluster of complementary
Products.
Mohan Sawhney proposed a concept of
metamarket.
Metamediaries to assist buyers to move
through these groups.

3. Marketers and Prospects: A marketer is

someone who seeks a response from
another party, called the prospect.
4. Needs, Wants, and Demand: A need can
be defined as a felt state of deprivation of
some basic satisfaction.
Primary needs/physiological or biogenic
needs.
Secondary / acquired needs.
Demand: ability and willingness to buy.

5. Product, Offering, and Brand:

Product is a set of benefits companies
offer to satisfy needs.
Offering: A combination of products,
services, information and experiences.
Brand: an offering from a known source.
6. Value and Satisfaction:
Value: ratio between what the customer
gets and what he gives.
Customer value triad: quality, service and
price (QSP).

VALUE AND SATISFICATION

Value

Benefits
Functionalbenefits emotionalbenefits

Costs
MonetaryCost TimeCost EnergyCost PsychicCost

Raise benefits
Reduce costs
Raise benefits and reduce costs
Raise benefits by more than the raise in costs.
Lower benefits by less than reduction in costs.

7.Exchange and Transactions

Exchange is the process of obtaining a
desired product from someone by
offering something in return.
Transaction is a trade of values
between two or more parties.

8.Relationships and Networks

Relationship marketing is building mutually
satisfying long-term relationship with key
parties. (customers, suppliers, distributors)
Marketing network consists of the
company and its supporting stakeholders
(customers, employees, suppliers,
distributors, retailers, ad agencies,
university scientists and others) with whom
it has built mutually profitable business
relationships.

9. Marketing Channels: To reach the target

market.
Communication channels: deliver and
receive messages.
Distribution channels: display, sell, or
deliver physical goods.
Service channels: to carry out
transactions with potential buyers. Ex:
warehouses, banks, transport, insurance
etc.

10.Supply Chain: Longer chain from raw

materials to components to final products
that are carried to final buyers.
11.Competition: all the actual and potential
rival offerings and substitutes that a buyer
might consider.
Brand competition
Industry Competition
Form Competition
Generic Competition

MARKETING ENVIRONMENT

Competition represent only one force inthe environment in which

the marketer operates. The marketing environment consist of the
task environment and the broad environment
The broad environment consist of six component : demographic
environment, economic environment, natural environment,
technological environment, political-legal environment and social
cultural environment
MARKETING MIX

Marketing mix is the set of marketing tools that the firm uses to
pursue its marketing objectives in the target market
Four P : Product, Price, Place, Promotion
Four C : Customer Solution, Customer Cost, Convenience,
Communication

COMPANY ORIENTATIONS TOWARD THE

MARKETPLACE
THE PRODUCTION CONCEPT

Holds that consumers will prefers product that are widely

available and inexpensive
THE PRODUCT CONCEPT
Holds thats consumers will favor those product that offer
the most quality, performance, or innovative features
THE SELLING CONCEPT
Holds that consumers and businesses, if left alone, will
ordinarily not buy enough of the organizations products.
The organization must, therefore, undertake an aggressive
selling and promotion effort
THE MARKETING CONCEPT
Holds that the key to achieving its organizational goals
consist of the company being more effective than
competitors in creating, delivering, and communicating
customer value to its chosen target markets

Determinants of Customer Delivered Value

Starting
Point
Factory

Focus
Product

Means
Selling and
Promoting

Ends
Profits through
sales volume

A. The Selling Concept

Target
market

Customer
needs

Integrated
Marketing

B. The Marketing Concept

Profits through
customer saticfaction

THE SOCIETAL MARKETING

CONCEPT
The societal marketing concept hold s that
the organizations task is to determine the
needs, wants and interest of target markets
and to deliver the desired satisfactions
more effectively and efficiently than
competitors in a way that preserves or
enchances the customers and the
societys well-being.

HOLISTIC MARKETING
CONCEPT

Companies have new capabilities that can

transform the way they have been doing
marketing.
Companies can operate a powerful new
information and sales channel.
Companies can collect fuller and richer
information.
Companies can facilitate and speed up
internal communication.

FOUR COMPONENTS

Relationship Marketing.
Integrated Marketing.
Internal Marketing.
Social Responsibility Marketing.
An approach to marketing that
attempts to recognize and reconcile
the scope and complexities of
marketing activities.

INTERNAL MARKETING
Internal marketing is the task of hiring,
training, and motivating able employees
who want to serve customers well.
It must take place at two levels
1. Various marketing functions must be
integrated
2.Marketing thinking must be so pervasive
throughout the company.

SOCIAL RESPONSIBILITY
MARKETING

The cause and effects of marketing

extend beyond the company and the
customer to society.
Social responsibility also requires that
marketers carefully consider the role that
they are playing and could play in terms
of social welfare.
Different names for this situation are
humanistic
marketing,
ecological
marketing
and
societal
marketing
concept. Also called as cause-related
marketing.

HOW BUSINESS AND MARKETING

ARE CHANGING

Company responses and adjustments

Reengineering
Outsourcing
E-commerce
Benchmarking
Alliances
Partner-suppliers
Market Centered
Global and local
Decentralized

Marketers responses and adjustment

Relationship marketing
Customer lifetime value
Customer share
Target marketing
Individualization
Customer database
Integrated marketing communications
Every employee a marketer