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Marketing Concepts-Sita Mishra

Marketing Concepts-Sita Mishra

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Sections

  • Introduction to Marketing Introduction to Marketing
  • Concepts Concepts
  • Learning Objectives Learning Objectives
  • Costs and Functions of Marketing Costs and Functions of Marketing
  • What is Marketing What is Marketing
  • Marketing Defined Marketing Defined
  • Implications of marketing Implications of marketing
  • Core Marketing Concepts Core Marketing Concepts
  • This is a Need This is a Need
  • This is a Want This is a Want
  • This is Demand This is Demand
  • Need / Want Fulfillment Need / Want Fulfillment
  • Product as an idea Product as an idea
  • Exchange & Transactions Exchange & Transactions
  • Transaction Transaction
  • Value and Satisfaction Value and Satisfaction
  • Relationship Marketing Relationship Marketing
  • What do marketers do? What do marketers do?
  • Marketing Mix Marketing Mix
  • 7 P¶s in Services Marketing 7 P¶s in Services Marketing
  • PACS Matrix PACS Matrix
  • Production Concept Production Concept
  • The Production Concept The Production Concept
  • Modern Day perspectives of Modern Day perspectives of
  • Production concept Production concept
  • Product Concept Product Concept
  • Avoiding Marketing Myopia Avoiding Marketing Myopia
  • Marketing Myopia Marketing Myopia
  • The Selling Concept The Selling Concept
  • The Marketing Concept The Marketing Concept
  • Customer Needs Customer Needs
  • Ethics and Social Responsibility: Ethics and Social Responsibility:
  • Doing Well by Doing Good Doing Well by Doing Good
  • The Holistic Marketing Concept The Holistic Marketing Concept
  • Four Levels of Competition Four Levels of Competition
  • Shifts in Marketing Management Shifts in Marketing Management
  • Other Concepts in Marketing Other Concepts in Marketing
  • Creativity and Critical Thinking Creativity and Critical Thinking

Introduction to Marketing Introduction to Marketing

Concepts Concepts
Dr.Sita Mishra Dr.Sita Mishra
Learning Objectives Learning Objectives
Define marketing
Outline the steps in the marketing
process.
Identify the core marketplace concepts.
Discuss the marketing management
orientations that guide marketing strategy.
Describe the major trends and forces that
are changing the marketing landscape in
this new age of relationships.
The New Economy The New Economy
± ±Increased buying power. Increased buying power.
± ±Greater variety of goods and services. Greater variety of goods and services.
± ±Increased information. Increased information.
± ±Enhanced shopping convenience. Enhanced shopping convenience.
± ±Greater opportunities to compare Greater opportunities to compare
product information with others. product information with others.
The New Economy The New Economy
Websites can provide companies with powerful Websites can provide companies with powerful
new information and sales channels. new information and sales channels.
Companies can collect fuller and richer Companies can collect fuller and richer
information about markets, customers, information about markets, customers,
prospects and competitors. prospects and competitors.
Companies can facilitate and speed up Companies can facilitate and speed up
communications among employees. communications among employees.
Companies can have 2 Companies can have 2- -way communication way communication
with customers and prospects with customers and prospects
The New Economy The New Economy
Companies can send ads, coupons, samples, Companies can send ads, coupons, samples,
information to targeted customers. information to targeted customers.
Companies can customize offerings and Companies can customize offerings and
services to individual customers. services to individual customers.
The Internet can be used as a communication The Internet can be used as a communication
channel for purchasing, training, and channel for purchasing, training, and
recruiting. recruiting.
Companies can improve logistics and Companies can improve logistics and
operations for cost savings while improving operations for cost savings while improving
accuracy and service quality. accuracy and service quality.
Selling is only the tip of the iceberg Selling is only the tip of the iceberg
³There will always be a need for
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. All that should be
needed is to make the product or
service available.´
Peter Drucker
Costs and Functions of Marketing Costs and Functions of Marketing
What is Marketing What is Marketing
Simple Definition: Marketing is managing Simple Definition: Marketing is managing
profitable customer relationships. profitable customer relationships.
Goals: Goals:
Attract new customers by promising superior Attract new customers by promising superior
value. value.
Keep and grow current customers by Keep and grow current customers by
delivering satisfaction. delivering satisfaction.
µMarketing is the management process
that identifies, anticipates and satisfies
customer requirements profitably¶
The Chartered Institute of Marketing
American Marketing Association¶s American Marketing Association¶s new new
official definition of marketing released official definition of marketing released
August 2004: August 2004:
± ± Marketing is an organizational function and a Marketing is an organizational function and a
set of processes for creating, communicating set of processes for creating, communicating
and delivering value to customers and for and delivering value to customers and for
managing customer relationships in ways that managing customer relationships in ways that
benefit the organization and its stakeholders. benefit the organization and its stakeholders.
Marketing Defined Marketing Defined
Kotler¶s social definition: Kotler¶s social definition:
³Marketing is a societal process by ³Marketing is a societal process by
which individuals and groups obtain which individuals and groups obtain
what they need and want through what they need and want through
creating, offering, and freely creating, offering, and freely
exchanging products and services of exchanging products and services of
value with others.´ value with others.´
Implications of marketing Implications of marketing
Who are our existing / potential Who are our existing / potential
customers? customers?
What are their current / future needs? What are their current / future needs?
How can we satisfy these needs? How can we satisfy these needs?
Can we offer a product/ service that the Can we offer a product/ service that the
customer would value? customer would value?
Can we communicate with our customers? Can we communicate with our customers?
Can we deliver a competitive product of Can we deliver a competitive product of
service? service?
Why should customers buy from us? Why should customers buy from us?
Core Marketing Concepts Core Marketing Concepts
Needs, wants, Needs, wants,
demands demands
Target markets Target markets
and market and market
segmentation segmentation
Marketers & Marketers &
prospects prospects
‡ ‡Product offering and Product offering and
brand brand
‡ ‡Value and satisfaction Value and satisfaction
‡Exchange and
transactions
‡Relationship and
networks
‡ ‡Market Market
This is a Need This is a Need

Needs Needs - - state of felt state of felt
deprivation deprivation
including physical, including physical,
social, and social, and
individual needs. individual needs.
Maslow¶s Hierarchy of Needs Maslow¶s Hierarchy of Needs
This is a Want This is a Want
Wants Wants ± ± Needs Needs
become wants become wants
when they are when they are
directed to directed to
specific objects specific objects
that might satisfy that might satisfy
the need. the need.
This is Demand This is Demand
Wants Wants
Buying Power
³Demand´
Need / Want Fulfillment Need / Want Fulfillment
Needs and Wants Needs and Wants
Fulfilled through a Fulfilled through a
Marketing Offer Marketing Offer ::
Some combination of Some combination of
products, services, products, services,
information, or information, or
experiences offered to experiences offered to
a market to satisfy a a market to satisfy a
need or want. need or want.

Products
Anything that can be Offered to a Market to Satisfy a Need or Want
Products
Anything that can be Offered to a Market to Satisfy a Need or Want
Persons Persons Places Places Organizations Organizations
Ideas Ideas Information Information
Services
Activity or Benefit Offered for Sale That is Essentially
Intangible and Does Not Result in the Ownership of Anything
Services
Activity or Benefit Offered for Sale That is Essentially
Intangible and Does Not Result in the Ownership of Anything
What Satisfies Consumers¶ Needs and Wants? What Satisfies Consumers¶ Needs and Wants?
Experiences Experiences Events Events Properties Properties
Product as an idea Product as an idea
Products do not have
to be physical
objects.
Here the ³product´ is
an idea²protecting
animals.
Core Marketing Concepts Core Marketing Concepts
Target markets & segmentation Target markets & segmentation
± ±Differences in needs, behavior, Differences in needs, behavior,
demographics or psychographics are demographics or psychographics are
used to identify used to identify segments segments..
± ±The segment served by the firm is The segment served by the firm is
called the called the target market target market..
± ±The market offering is customized to The market offering is customized to
the needs of the target market. the needs of the target market.
Core Marketing Concepts Core Marketing Concepts
Shopping can take place in a: Shopping can take place in a:
± ± Marketplace (physical entity) Marketplace (physical entity)
± ± Marketspace (virtual entity) Marketspace (virtual entity)
Metamarkets Metamarkets refer to complementary refer to complementary
goods and services that are related in goods and services that are related in
the minds of consumers. the minds of consumers.
Marketers Marketers seek responses from seek responses from
prospects prospects. .
Exchange & Transactions Exchange & Transactions
Exchange Exchange is one of the four ways in which a is one of the four ways in which a
person can obtain a product. It is a core person can obtain a product. It is a core
concept of marketing. For exchange potential concept of marketing. For exchange potential
to exist, five conditions must be satisfied : to exist, five conditions must be satisfied :
At least two participants in the process. At least two participants in the process.
Each party must offer something of value to Each party must offer something of value to
the other. the other.
Both parties must want to deal with each other. Both parties must want to deal with each other.
Both participants have the right to accept or to Both participants have the right to accept or to
reject the offer. reject the offer.
Both groups must have the ability to Both groups must have the ability to
communicate and deliver on the mutual communicate and deliver on the mutual
agreement. agreement.
Exchange what they want & Exchange what they want &
need need
Marketing creates utility through the Marketing creates utility through the
exchange process exchange process
± ± Utility Utility: Want : Want- -satisfying power of a good or satisfying power of a good or
service service
Form utility Form utility
Time utility Time utility
Place utility Place utility
Ownership utility Ownership utility
Transaction Transaction
Transaction is a trade of values Transaction is a trade of values
between two or more parties. between two or more parties.
It involves at least two things of It involves at least two things of
value, agreed value, agreed- -upon conditions, a upon conditions, a
time of agreement, and a place of time of agreement, and a place of
agreement. agreement.
Value and Satisfaction Value and Satisfaction
How Do Consumers Choose Among
Products and Services?
Value Gained From Owning a Product and Costs of
Obtaining the Product is
Customer Value
Productƍs Perceived Performance in Delivering Value Relative to
Buyerƍs Expectations is
Customer Satisfaction
Total Quality Management
Involves Improving the Quality of Products, Services, and
Marketing Processes
Exchanges Exchanges
Transactions Transactions
Relationships Relationships
Building a Marketing
Network Consisting of
The Company and All
Its Supporting
Stakeholders
How Do Consumers Obtain
Products and Services?
Relationship Marketing Relationship Marketing
Four key constituents for marketing are: Four key constituents for marketing are:
Customer Customer
Marketing Partners ( channel, suppliers, Marketing Partners ( channel, suppliers,
distributors, dealers and agencies) distributors, dealers and agencies)
Employee Employee
Members of financial community (shareholders, Members of financial community (shareholders,
investors) investors)
The development of strong relationships requires The development of strong relationships requires
an understanding of the capabilities and an understanding of the capabilities and
resources of different groups, as well as their resources of different groups, as well as their
needs, goals and desires. needs, goals and desires.
What is a Market? What is a Market?
The set of actual and potential buyers The set of actual and potential buyers
of a product. of a product.
These people share a need or want These people share a need or want
that can be satisfied through exchange that can be satisfied through exchange
relationships. relationships.



Ethical
Potential
Buyers
Market
Ɗ Buyers who
share a
particular
need or want
that can be
satisfied
through
exchange or
relationships.
Actual
Buyers
Who Purchases
Products and Services?
People Who
Exhibit Need
Resources to
Exchange
Willingness to
Exchange
What is Market? What is Market?
A A market market consists consists of of all all the the potential potential customers customers sharing sharing
a a particular particular need need or or want want who who might might be be willing willing and and able able
to to engage engage in in exchange exchange to to satisfy satisfy that that need need or or want want..
Potential Market (have sufficient level of interest in a Potential Market (have sufficient level of interest in a
market offer) market offer)
Available Market (who have interest, income and Available Market (who have interest, income and
access to a particular offer) access to a particular offer)
Qualified available market Qualified available market
Target Market or Served Market (a co. can go for Target Market or Served Market (a co. can go for
serving whole available market or can concentrate on serving whole available market or can concentrate on
certain segments) certain segments)
Penetrated Market (set of buyers who are buying the Penetrated Market (set of buyers who are buying the
co.¶s product) co.¶s product)
What do marketers do? What do marketers do?
Marketing Mix Marketing Mix
7 P¶s in Services Marketing 7 P¶s in Services Marketing
3 additional P¶s in services marketing 3 additional P¶s in services marketing
People: Any person coming into contact with People: Any person coming into contact with
customers can have an impact on overall customers can have an impact on overall
satisfaction. satisfaction.
Process: Process(es) involved in providing a Process: Process(es) involved in providing a
service and the behaviour of people, which can be service and the behaviour of people, which can be
crucial to customer satisfaction. crucial to customer satisfaction.
Physical evidence Physical evidence- - The ability and environment in The ability and environment in
which the service is delivered. It includes both the which the service is delivered. It includes both the
tangible goods that help to communicate and tangible goods that help to communicate and
perform the service or intangible experience of the perform the service or intangible experience of the
customers. customers.
Matching Mix Concepts (A & S) Matching Mix Concepts (A & S)
4 A¶s 4 A¶s 4 S¶s 4 S¶s
Acceptability Solution Acceptability Solution
Affordable Sense Affordable Sense
Accessible Spread Accessible Spread
Awareness Supports Awareness Supports
PACS Matrix PACS Matrix
Product Acceptability Customer Sol Solution Product Acceptability Customer Sol Solution
Price Acceptable Cost Sense Price Acceptable Cost Sense
Place Access Convenience Spread Place Access Convenience Spread
Promo Awareness Communicate Support Promo Awareness Communicate Support
SIVA approach SIVA approach
Solution: How appropriate is the solution to the Solution: How appropriate is the solution to the
customers problem/need customers problem/need
Information: Does the customer know about the Information: Does the customer know about the
solution, and if so how, who from, do they know solution, and if so how, who from, do they know
enough to let them make a buying decision enough to let them make a buying decision
Value: Does the customer know the value of the Value: Does the customer know the value of the
transaction, what it will cost, what are the benefits, transaction, what it will cost, what are the benefits,
what might they have to sacrifice, what will be their what might they have to sacrifice, what will be their
reward? reward?
Access: Where can the customer find the solution. Access: Where can the customer find the solution.
How easily/locally/remotely can they buy it and take How easily/locally/remotely can they buy it and take
delivery. delivery.
This model was proposed by Chekitan Dev and Don This model was proposed by Chekitan Dev and Don
Schultz Schultz
1 1- -44 44
Four Eras in the History of Marketing Four Eras in the History of Marketing
Production Concept Production Concept
Consumers will favour those products Consumers will favour those products
that are widely available and low in cost. that are widely available and low in cost.
Therefore increase production and cut Therefore increase production and cut
down costs. down costs.
And build profit through volume. And build profit through volume.
The Production Concept The Production Concept
A customer can have any colour he likes for
his car so long as it's black¶
Henry Ford
Modern Day perspectives of Modern Day perspectives of
Production concept Production concept
Managers Managers of of production production oriented oriented firms firms
concentrate concentrate on on achieving achieving high high production production
efficiency, efficiency, Low Low costs, costs, and and mass mass distribution distribution
This This orientation orientation makes makes sense sense in in developing developing
countries countries such such as as china china.. Companies Companies like like
Lenovo Lenovo && Haier Haier take take advantage advantage of of country¶s country¶s
huge huge and and inexpensive inexpensive labour labour pool pool to to
dominate dominate the the market market..
Marketers Marketers also also use use the the production production concept concept
when when a a firm firm wants wants to to expand expand the the market market
Product Concept Product Concept
Consumers will favour those products Consumers will favour those products
that offer the most quality, performance, that offer the most quality, performance,
or innovative features. or innovative features.
Therefore, improve quality, performance Therefore, improve quality, performance
and features. and features.
This would lead to increased sales and This would lead to increased sales and
profits. profits.
Avoiding Marketing Myopia Avoiding Marketing Myopia
Marketing Myopia Marketing Myopia is management¶s is management¶s
failure to recognize the scope of its failure to recognize the scope of its
business. business.
± ± To avoid marketing myopia, companies To avoid marketing myopia, companies
must broadly define organizational goals must broadly define organizational goals
toward consumer needs toward consumer needs
± ± Focus on benefits Focus on benefits
Marketing Myopia Marketing Myopia
Management¶s failure to recognize a company¶s Management¶s failure to recognize a company¶s
scope of business. scope of business.
Sellers pay more attention to the specific products Sellers pay more attention to the specific products
they offer than to the benefits and experiences they offer than to the benefits and experiences
produced by the products. produced by the products.
They focus on the ³wants´ and lose sight of the They focus on the ³wants´ and lose sight of the
³needs.´ ³needs.´
Marketing Myopia Marketing Myopia
To overcome this
-Be customer led
-Whole company must
have market orientation
-Management must be
visionary and pro-active
The Selling Concept The Selling Concept
Consumers , if left alone , will not buy Consumers , if left alone , will not buy
enough of company¶s products. enough of company¶s products.
Therefore, promote sales aggressively. Therefore, promote sales aggressively.
And,build profit through quick turnover. And,build profit through quick turnover.
The Marketing Concept The Marketing Concept
The key to achieving organizational goals The key to achieving organizational goals
consist in determining the needs and wants consist in determining the needs and wants
of target markets and delivering the desired of target markets and delivering the desired
satisfactions more effectively and efficiently satisfactions more effectively and efficiently
than competitors. than competitors.
And build profit through customer And build profit through customer
satisfaction and loyalty. satisfaction and loyalty.
Marketing and Sales Concepts Contrasted Marketing and Sales Concepts Contrasted
Customer Needs Customer Needs
Stated need, Real need ,Unstated need, Stated need, Real need ,Unstated need,
Delight need, Secret need Delight need, Secret need
- -Responsive marketing (finding stated need Responsive marketing (finding stated need
and filling it) and filling it)
- -Anticipative marketing (looking ahead into Anticipative marketing (looking ahead into
what needs consumer may have in future) what needs consumer may have in future)
- - Creative marketing (discovering and Creative marketing (discovering and
producing solution consumers never ask for producing solution consumers never ask for
but to which they respond enthusiastically) but to which they respond enthusiastically)
The Societal Marketing Concept The Societal Marketing Concept
The The societal societal marketing marketing concept concept holds holds that that the the
organization¶s organization¶s task task is is to to determine determine the the needs, needs,
wants, wants, and and interests interests of of target target markets markets and and to to
deliver deliver the the desired desired satisfactions satisfactions more more
effectively effectively and and efficiently efficiently than than competitors competitors in in a a
way way that that preserves preserves or or enhances enhances the the
consumer¶s consumer¶s and and the the society¶s society¶s well well being being..
- - It It addresses addresses conflicts conflicts between between consumer¶s consumer¶s
and and firm¶s firm¶s short short run run wants wants and and long long term term
welfare welfare..
The Societal Marketing Concept The Societal Marketing Concept
It It calls calls for for social social and and ethical ethical considerations considerations
in in marketing marketing.. They They must must balance balance the the
conflicting conflicting criteria criteria of of company company profit, profit,
consumer consumer want want satisfaction satisfaction and and public public
interest interest..
Cause Cause- -related related marketing marketing (Activity (Activity by by which which a a
company company with with an an image, image, product product or or service service
to to market market builds builds a a relationship/partnership relationship/partnership
with with a a cause/causes cause/causes for for mutual mutual benefit benefit..
Ethics and Social Responsibility: Ethics and Social Responsibility:
Doing Well by Doing Good Doing Well by Doing Good
Increased Employee Loyalty Increased Employee Loyalty
Better Public Image Better Public Image
Market Place Success Market Place Success
Improved Financial Performance Improved Financial Performance
Social marketing should not be
confused with the Societal Marketing
Concept which integrates issues of
social responsibility into commercial
marketing strategies. In contrast to
that, social marketing uses
commercial marketing theories, tools
and techniques to social issues.
The Holistic Marketing Concept The Holistic Marketing Concept
It It is is based based on on the the development, development, design design and and
implementation implementation of of marketing marketing programmes programmes,,
processes processes and and activities activities that that recognises recognises
their their breadth breadth and and interdependencies interdependencies.. Four Four
components components are are::
Relationship Relationship marketing marketing
Integrated Integrated marketing marketing
Internal Internal marketing marketing
Social Social responsibility responsibility marketing marketing
Holistic
Marketing
Integrated
marketing
Relationship
Marketing
Social
Responsibility
Marketing
Internal
Marketing
Marketing
deptt
Senior
Mgt
Other
Deptt
Communications
Products &
Services
Channels
Ethics
Environment
Community
Legal
Customers Partners
Channels
STATE OF DEMAND AND STATE OF DEMAND AND
MARKETING TASK MARKETING TASK
State of demand State of demand
Negative Demand Negative Demand
No Demand No Demand
Latent Demand Latent Demand
Falling Demand Falling Demand
Irregular Demand Irregular Demand
Full Demand Full Demand
Overfull Demand Overfull Demand
Un Un- -wholesome wholesome
Demand Demand
Marketing task
‡Conversional Mktg.
‡Stimulational Mktg.
‡Developmental Mktg.
‡Remarketing
‡Synchro-marketing
‡Maintenance Mktg.
‡De-marketing
‡Counter-marketing
Four Levels of Competition Four Levels of Competition

Brand competition
Industry competition Industry competition
Form competition Form competition
Generic competition Generic competition
How Business and Marketing are Changing/ How Business and Marketing are Changing/
Marketing themes in the new economy Marketing themes in the new economy
Changing Technology Changing Technology
Globalization Globalization
Customer Empowerment Customer Empowerment
Customization Customization
Customer relationship marketing
Customer lifetime value
Target marketing
Integrated marketing communication
Channels as partners
Every employee a marketer
WHAT IS MARKETING WHAT IS MARKETING
MANAGEMENT ? MANAGEMENT ?
Marketing Management is the analysis, Marketing Management is the analysis,
planning, implementation and control of planning, implementation and control of
programs designed to create, build and programs designed to create, build and
maintain beneficial exchanges and maintain beneficial exchanges and
relationships with target markets for the relationships with target markets for the
purpose of achieving Organisational purpose of achieving Organisational
objectives. objectives.
Shifts in Marketing Management Shifts in Marketing Management
From Marketing does the marketing to From Marketing does the marketing to
Everyone does the marketing Everyone does the marketing
From organizing by product units to From organizing by product units to
organizing by customer segments organizing by customer segments
From making everything to From making everything to
buying more goods and services from outside buying more goods and services from outside
From using many supplier to From using many supplier to
working with fewer suppliers in a partnership working with fewer suppliers in a partnership
From relying on old market positions to From relying on old market positions to
uncovering new ones uncovering new ones
From focusing on shareholders to From focusing on shareholders to
focusing on stakeholders focusing on stakeholders
Shifts in Marketing Management Shifts in Marketing Management
From emphasizing tangible assets to From emphasizing tangible assets to
emphasizing intangible assets emphasizing intangible assets
From building brands through advertising to From building brands through advertising to
building brands through integrated communication building brands through integrated communication
From offline to online From offline to online
From mass market to target market From mass market to target market
From focusing on profitable transactions to From focusing on profitable transactions to
focusing on customer lifetime value focusing on customer lifetime value
From focus on gaining market share to From focus on gaining market share to
focus on building customer share focus on building customer share
From being local to being ³Glocal´ From being local to being ³Glocal´
Word of Mouth Word of Mouth Marketing Marketing (WOMM), is a (WOMM), is a
marketing marketing effort designed to stimulate effort designed to stimulate
consumers by verbal means such as consumers by verbal means such as
recommendations recommendations
Techniques Techniques
Viral Viral Marketing Marketing ( (Viral Viral marketing marketing is creating interesting and entertaining messages is creating interesting and entertaining messages
that spread exponentially, usually through methods such as the web and email, to large that spread exponentially, usually through methods such as the web and email, to large
numbers of people numbers of people..
Buzz Buzz Marketing Marketing
Blog Branding Blog Branding
Guerrilla Guerrilla Marketing Marketing (a way to market and get the message of an product out on a low (a way to market and get the message of an product out on a low
profile profile. .
Community Community Marketing Marketing Online, niche communities and publications that Online, niche communities and publications that
create lasting relationships between community members and brands create lasting relationships between community members and brands
Other Concepts in Marketing Other Concepts in Marketing
Green marketing Green marketing
Person marketing Person marketing
Neuro Neuro marketing marketing
Ambush marketing Ambush marketing
Permission marketing Permission marketing
Contextual marketing Contextual marketing
Stealth marketing Stealth marketing
Experiential marketing Experiential marketing
Covert advertising Covert advertising
Surrogate advertising Surrogate advertising
Creativity and Critical Thinking Creativity and Critical Thinking
Challenges presented by today¶s complex Challenges presented by today¶s complex
and technologically sophisticated marketing and technologically sophisticated marketing
environment require critical environment require critical- -thinking skills thinking skills
and creativity from marketing professionals and creativity from marketing professionals
Critical Thinking refers to the process of Critical Thinking refers to the process of
determining the authenticity, accuracy, and determining the authenticity, accuracy, and
worth of information, knowledge, claims and worth of information, knowledge, claims and
arguments arguments
Creativity helps to develop novel solutions Creativity helps to develop novel solutions
to perceived marketing problems to perceived marketing problems

Learning Objectives 
   
Define marketing Outline the steps in the marketing process. Identify the core marketplace concepts. Discuss the marketing management orientations that guide marketing strategy. Describe the major trends and forces that are changing the marketing landscape in this new age of relationships.

The New Economy
± Increased buying power. ± Greater variety of goods and services. ± Increased information. ± Enhanced shopping convenience. ± Greater opportunities to compare product information with others.

customers.  Companies can collect fuller and richer information about markets.  Companies can facilitate and speed up communications among employees. prospects and competitors.The New Economy  Websites can provide companies with powerful new information and sales channels.  Companies can have 2-way communication 2with customers and prospects .

and recruiting.The New Economy  Companies can send ads.  Companies can customize offerings and services to individual customers. coupons. . training. samples.  Companies can improve logistics and operations for cost savings while improving accuracy and service quality.  The Internet can be used as a communication channel for purchasing. information to targeted customers.

.

The aim of marketing is to know and understand the customer so well that the product or service fits him and sells itself. Ideally.´ Peter Drucker . marketing should result in a customer who is ready to buy. But the aim of marketing is to make selling superfluous.Selling is only the tip of the iceberg ³There will always be a need for some selling. All that should be needed is to make the product or service available.

Costs and Functions of Marketing .

 Keep and grow current customers by delivering satisfaction. Goals:  Attract new customers by promising superior value.What is Marketing  Simple Definition: Marketing is managing profitable customer relationships. .

anticipates and satisfies customer requirements profitably¶ The Chartered Institute of Marketing .µMarketing is the management process that identifies.

communicating and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders. American Marketing Association¶s new official definition of marketing released August 2004: ± Marketing is an organizational function and a set of processes for creating. .

and freely exchanging products and services of value with others.´ .Marketing Defined  Kotler¶s social definition: ³Marketing is a societal process by which individuals and groups obtain what they need and want through creating. offering.

Implications of marketing  Who are our existing / potential customers?  What are their current / future needs?  How can we satisfy these needs?  Can we offer a product/ service that the customer would value?  Can we communicate with our customers?  Can we deliver a competitive product of service?  Why should customers buy from us? .

demands  Target markets and market segmentation  Marketers & prospects ‡Product offering and brand ‡Value and satisfaction ‡Exchange and transactions ‡Relationship and networks ‡Market .Core Marketing Concepts  Needs. wants.

. and individual needs. social.This is a Need  Needs .state of felt deprivation including physical.

Maslow¶s Hierarchy of Needs .

This is a Want Wants ± Needs become wants when they are directed to specific objects that might satisfy the need. .

This is Demand
Wants Buying Power

³Demand´

Need / Want Fulfillment 
Needs and Wants Fulfilled through a Marketing Offer : Some combination of products, services, information, or experiences offered to a market to satisfy a need or want.

What Satisfies Consumers¶ Needs and Wants?
Products
Anything that can be Offered to a Market to Satisfy a Need or Want 

Persons Places Organizations

Information Experiences Events Services

Ideas Properties

Activity or Benefit Offered for Sale That is Essentially Intangible and Does Not Result in the Ownership of Anything

.Product as an idea Products do not have to be physical objects. Here the ³product´ is an idea²protecting animals.

behavior. market. ± The segment served by the firm is called the target market. . demographics or psychographics are used to identify segments.Core Marketing Concepts  Target markets & segmentation ± Differences in needs. ± The market offering is customized to the needs of the target market. segments.

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 Marketers seek responses from prospects. . prospects.Core Marketing Concepts  Shopping can take place in a: ± Marketplace (physical entity) ± Marketspace (virtual entity)  Metamarkets refer to complementary goods and services that are related in the minds of consumers.

five conditions must be satisfied :  At least two participants in the process. It is a core concept of marketing.  Both groups must have the ability to communicate and deliver on the mutual agreement. . For exchange potential to exist.  Both participants have the right to accept or to reject the offer.Exchange & Transactions Exchange is one of the four ways in which a person can obtain a product.  Both parties must want to deal with each other.  Each party must offer something of value to the other.

Exchange what they want & need .

 Marketing creates utility through the exchange process ± Utility: Want-satisfying power of a good or Utility: Wantservice     Form utility Time utility Place utility Ownership utility .

Transaction  Transaction is a trade of values between two or more parties. and a place of agreement. agreed-upon conditions. . a agreedtime of agreement. It involves at least two things of value.

Value and Satisfaction .

How Do Consumers Choose Among Products and Services? Value Gained From Owning a Product and Costs of Obtaining the Product is Customer Value Product s Perceived Performance in Delivering Value Relative to Buyer s Expectations is Customer Satisfaction Total Quality Management Involves Improving the Quality of Products. Services. and Marketing Processes .

How Do Consumers Obtain Products and Services? Exchanges Relationships Transactions Building a Marketing Network Consisting of The Company and All Its Supporting Stakeholders .

. suppliers. as well as their needs. goals and desires. distributors. dealers and agencies)  Employee  Members of financial community (shareholders. investors) The development of strong relationships requires an understanding of the capabilities and resources of different groups.Relationship Marketing Four key constituents for marketing are:  Customer  Marketing Partners ( channel.

.What is a Market?  The set of actual and potential buyers of a product.  These people share a need or want that can be satisfied through exchange relationships.

Actual Buyers Potential Buyers .Who Purchases Products and Services? People Who Exhibit Need Resources to Exchange Willingness to Exchange Market Buyers Ethical rotcaFwho s share a lanoitautiS detcepxenU particular need or want that can be satisfied through exchange or relationships.

want.What is Market? A market consists of all the potential customers sharing a particular need or want who might be willing and able to engage in exchange to satisfy that need or want.  Potential Market (have sufficient level of interest in a market offer)  Available Market (who have interest. income and access to a particular offer)  Qualified available market  Target Market or Served Market (a co. can go for serving whole available market or can concentrate on certain segments)  Penetrated Market (set of buyers who are buying the co.¶s product) .

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What do marketers do? .

Marketing Mix .

 Process: Process(es) involved in providing a service and the behaviour of people. which can be crucial to customer satisfaction.  Physical evidence.The ability and environment in evidencewhich the service is delivered.7 P¶s in Services Marketing 3 additional P¶s in services marketing  People: Any person coming into contact with customers can have an impact on overall satisfaction. It includes both the tangible goods that help to communicate and perform the service or intangible experience of the customers. .

Matching Mix Concepts (A & S)  4 A¶s Acceptability Affordable Accessible Awareness 4 S¶s Solution Sense Spread Supports .

PACS Matrix  Product Acceptability Price Acceptable Place Access Promo Awareness Customer Sol Cost Convenience Communicate Solution Sense Spread Support .

How easily/locally/remotely can they buy it and take delivery.SIVA approach  Solution: How appropriate is the solution to the customers problem/need  Information: Does the customer know about the solution. what it will cost. what will be their reward?  Access: Where can the customer find the solution. and if so how. This model was proposed by Chekitan Dev and Don Schultz . what might they have to sacrifice. do they know enough to let them make a buying decision  Value: Does the customer know the value of the transaction. who from. what are the benefits.

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Four Eras in the History of Marketing 1-44 .

.  And build profit through volume.Production Concept  Consumers will favour those products that are widely available and low in cost.  Therefore increase production and cut down costs.

The Production Concept A customer can have any colour he likes for his car so long as it's black¶ Henry Ford .

Companies like china. market. Lenovo & Haier take advantage of country¶s huge and inexpensive labour pool to dominate the market. and mass distribution  This orientation makes sense in developing countries such as china.  Marketers also use the production concept when a firm wants to expand the market .Modern Day perspectives of Production concept  Managers of production oriented firms concentrate on achieving high production efficiency. Low costs.

performance and features.  Therefore.  This would lead to increased sales and profits. performance. improve quality.Product Concept  Consumers will favour those products that offer the most quality. . or innovative features.

± To avoid marketing myopia.Avoiding Marketing Myopia  Marketing Myopia is management¶s failure to recognize the scope of its business. companies must broadly define organizational goals toward consumer needs ± Focus on benefits .

 They focus on the ³wants´ and lose sight of the ³needs.Marketing Myopia  Management¶s failure to recognize a company¶s scope of business.´ .  Sellers pay more attention to the specific products they offer than to the benefits and experiences produced by the products.

Marketing Myopia To overcome this -Be customer led -Whole company must have market orientation -Management must be visionary and pro-active .

will not buy enough of company¶s products. promote sales aggressively.build profit through quick turnover.The Selling Concept  Consumers .  Therefore.  And. . if left alone .

The Marketing Concept  The key to achieving organizational goals consist in determining the needs and wants of target markets and delivering the desired satisfactions more effectively and efficiently than competitors. .  And build profit through customer satisfaction and loyalty.

Marketing and Sales Concepts Contrasted .

Real need .Customer Needs Stated need.Unstated need. Delight need.Creative marketing (discovering and producing solution consumers never ask for but to which they respond enthusiastically) . Secret need -Responsive marketing (finding stated need and filling it) -Anticipative marketing (looking ahead into what needs consumer may have in future) .

and interests of target markets and to deliver the desired satisfactions more effectively and efficiently than competitors in a way that preserves or enhances the consumer¶s and the society¶s well being. welfare. .It addresses conflicts between consumer¶s and firm¶s short run wants and long term welfare.  . being.The Societal Marketing Concept  The societal marketing concept holds that the organization¶s task is to determine the needs. wants.

product or service to market builds a relationship/partnership with a cause/causes for mutual benefit. They must balance the marketing. conflicting criteria of company profit. benefit. interest. .  Cause-related marketing (Activity by which a Causecompany with an image.The Societal Marketing Concept  It calls for social and ethical considerations in marketing. consumer want satisfaction and public interest.

Ethics and Social Responsibility: Doing Well by Doing Good  Increased Employee Loyalty  Better Public Image  Market Place Success  Improved Financial Performance .

In contrast to that.Social marketing should not be confused with the Societal Marketing Concept which integrates issues of social responsibility into commercial marketing strategies. social marketing uses commercial marketing theories. tools and techniques to social issues. .

their breadth and interdependencies. processes and activities that recognises interdependencies.The Holistic Marketing Concept  It is based on the development. design and implementation of marketing programmes. programmes. Four components are: are:     Relationship marketing Integrated marketing Internal marketing Social responsibility marketing .

Marketing deptt Senior Mgt Other Deptt Communications Products & Services Channels Internal Marketing Integrated marketing Holistic Marketing Social Responsibility Marketing Ethics Environment Customers Relationship Marketing Community Legal Partners Channels .

‡Remarketing ‡Synchro-marketing ‡Maintenance Mktg. ‡De-marketing ‡Counter-marketing . ‡Developmental Mktg. ‡Stimulational Mktg.STATE OF DEMAND AND MARKETING TASK State of demand         Negative Demand No Demand Latent Demand Falling Demand Irregular Demand Full Demand Overfull Demand UnUn-wholesome Demand Marketing task ‡Conversional Mktg.

Four Levels of Competition  Generic competition Form competition Industry competition Brand competition .

How Business and Marketing are Changing/ Marketing themes in the new economy           Changing Technology Globalization Customer Empowerment Customization Customer relationship marketing Customer lifetime value Target marketing Integrated marketing communication Channels as partners Every employee a marketer .

.WHAT IS MARKETING MANAGEMENT ?  Marketing Management is the analysis. build and maintain beneficial exchanges and relationships with target markets for the purpose of achieving Organisational objectives. planning. implementation and control of programs designed to create.

Shifts in Marketing Management  From Marketing does the marketing to Everyone does the marketing  From organizing by product units to organizing by customer segments  From making everything to buying more goods and services from outside  From using many supplier to working with fewer suppliers in a partnership  From relying on old market positions to uncovering new ones  From focusing on shareholders to focusing on stakeholders .

Shifts in Marketing Management  From emphasizing tangible assets to emphasizing intangible assets  From building brands through advertising to building brands through integrated communication  From offline to online  From mass market to target market  From focusing on profitable transactions to focusing on customer lifetime value  From focus on gaining market share to focus on building customer share  From being local to being ³Glocal´ .

usually through methods such as the web and email. Buzz Marketing Blog Branding Guerrilla Marketing profile (a way to market and get the message of an product out on a low . niche communities and publications that create lasting relationships between community members and brands . Word of Mouth Marketing (WOMM). to large numbers of people .  Community Marketing Online. is a marketing effort designed to stimulate consumers by verbal means such as recommendations Techniques Viral Marketing (Viral marketing is creating interesting and entertaining messages that spread exponentially.

Other Concepts in Marketing           Green marketing Person marketing Neuro marketing Ambush marketing Permission marketing Contextual marketing Stealth marketing Experiential marketing Covert advertising Surrogate advertising .

claims and arguments  Creativity helps to develop novel solutions to perceived marketing problems . accuracy.Creativity and Critical Thinking  Challenges presented by today¶s complex and technologically sophisticated marketing environment require critical-thinking skills criticaland creativity from marketing professionals  Critical Thinking refers to the process of determining the authenticity. knowledge. and worth of information.

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