Unit I

Definition of Marketing

Marketing consists of the strategies and tactics used to identify, create and
maintain satisfying relationships with customers that result in value for both the
customer and the marketer.

The functions of marketers:

Target Markets
Products/Services
Promotion
Distribution
Pricing
Services

EVOLUTION OF MARKETING MANAGEMENT:

The evolution of marketing is composed of a series of responses to major

external challenges. The industrial era created expanding markets which
required an emphasis on production, logistics and selling, to get the goods to the
customer. Marketing is a relatively latest discipline having emerged in the early
1900s.
But starting in the 1950s, companies began to see the old ways of selling were
wearing thin with customers. As competition grew stiffer across most industries,
organizations looked to the buyer side of the transaction for ways to improve.

THE ROLE OF MARKETING

At the organizational level, marketing is a vital business function that is

necessary in nearly all industries whether the organization operates as a for-
profit or as a not-for profit.
For the for-profit organization, marketing is responsible for most tasks that bring
revenue and, hopefully, profits to an organization. For the not-for-profit
organization, marketing is responsible for attracting customers needed to support
the not-for-profit’s mission, such as raising donations or supporting a cause.
Marketing is also the organizational business area that interacts most frequently
with the public and, consequently, what the public knows about an organization is
determined by their interactions with marketers. For example, customers may
believe a company is dynamic and creative, based on its advertising message.

THE MARKETING CONCEPT

The Production Concept

Can we produce the product?

Can we produce enough of it?

The Sales Concept

Can we sell the product?

Can we charge enough for it?

The Marketing Concept

What do customers want?

Can we develop it while they still want it?

How can we keep our customers satisfied?

THE MARKETING MIX (THE 4 P’S OF MARKETING) - AN INTRODUCTION

Product Price Place Promotion

Limitations of the Marketing Mix Framework

The marketing mix framework was particularly useful in the early days of the
marketing concept when physical products represented a larger portion of the
economy. Today, with marketing more integrated into organizations and with a
wider variety of products and markets, some authors have attempted to extend
its usefulness by proposing a fifth P, such as packaging, people, process, etc.
Today, however, the marketing mix most commonly remains based on the 4 P’s.
Despite its limitations and perhaps because of its simplicity, the use of this
framework remains strong and many marketing textbooks have been organized
around it.

Marketing Environment: INTRODUCTION: The Business environment surrounds

and impacts upon the organization. There are three key perspectives on the
environment, namely the ‘macro-environment,’ the ‘micro-environment’ and the
‘internal environment’.

Micro - environment influences the organization directly. It includes suppliers that

deal directly or indirectly, consumers and customers, and other local
stakeholders.

SOCIAL ENVIRONMENT
CULTURAL ENVIRONMENT

ECONOMIC ENVIRONMENT

Levels of the economy: Two types of policies are pursued by State to combat
the inflationary and deflationary tendencies in the economy. These are called
stabilization policies, which mainly include : (i) Monetary policy and (ii) Fiscal
policy.

1. Monetary policy. It refers to the credit control measures adopted by the

central bank of an economy (in India, the Reserve Bank of India). These are of
two kinds :

Quantitative controls: Quantitative or general controls include bank rate

variations, open market operations and varying reserve ratios. They aim at
regulating the overall level of credit in the economy through the commercial
banks.

Selective credit controls are used to encourage or discourage specific types of

credit for particular purposes. In order to check the speculative activity in the
economy, the central bank changes the margin requirements to be charged by
the commercial banks on those activities.

2. Fiscal policy. Fiscal policy refers to the deliberate changing of taxes and
government spending for the purpose of keeping the actual GNP close to the
potential full employment GNP. If the potential GNP is exceeded it causes
inflation, while if the actual GNP falls short of the potential it causes recessionary
conditions.

Indicators of Economic Development:

Inflation: Inflation has attracted sufficient attention of economists and policy

makers. India is pursuing a policy of planned economic development. One of the
prime considerations in the strategy of growth has been to ensure that growth
takes place in an environment of price stability.

Emergence of Consuming Class:

Foreign Direct Investment:

Politico-legal environment:

India suffered political instability for a few years due to the failure of any party to
win an absolute majority in the parliament. However, political stability has
returned since the previous general elections in 1999. However, political
instability did not change India’s economic course though it delayed certain
decisions relating to the economy.

Lessons for Marketers:

SMS

One can locate the nearest pizza outlet or log on to a Website to check out the
specifications of the new car you plan to buy.

i-Seminars

Seminars on the internet instead of physical seminars is better for the customer
regarding travel, time and expense.

E-marketing :No snail mailing, only e-mails; interactive web information (no
printing of brouchers) and Web banners.

e-Surveys : Online market surveys of customers help in deciding product

strategies, which result in a greater possibility of acceptance of the final product
or service, adding to the the brand value of the organization.
Online billboards: Online billboards made of super-large plasma displays allow
for time-sharing and instant message revision.

Superior design tools: Better tools like Photoshop and illustrator allow a
designer to do things that would have required very expensive design
workstations a decade or two ago.

Touch-screen kiosks: Touch sreen kiosks used to market and showcase brands
at shopping malls have changed the way a consumer can feel and experience a
product on the shop floor.

Analysis tools: Better data mining technologies coupled with cheaper storage
has accelerated the pace of research, so that one can narrow down on one’s
target and focus better.

Marketing Interface with other Functional areas of Management

INTRODUCTION: Marketing is a dynamic discipline. Marketing has certain

objectives and that will deliver the best possible results for the organization.

MARKETING MANAGEMENT: Marketing management is an important operative

function (as distinct from managerial function) of management. It performs all
managerial functions in the field of marketing. It is responsible for planning,
organizing, directing and controlling the marketing activities. It is required to build
up appropriate marketing-mix to achieve the objectives of the business.

NATURE OF MARKETING

1. Marketing is customer-focused
2. Marketing must deliver value
 3. Marketing is surrounded by customer needs.

4. Marketing as Science and Art

SCOPE AND FUNCTIONS OF MARKETING

i. Marketing research
ii. Product planning and development
iii. Buying and assembling
iv. Selling
v. Standardization, grading and branding
vi. Packaging
vii. Storage
viii. Transportation
ix. Salesmanship
x. Advertising
xi. Pricing
xii. Financing
xiii. Insurance

FUNCTIONS OF RESEARCH

Marketing Research
 Product Planning and Development

FUNCTIONS OF EXCHANGE

Buying and Assembling

Selling

FUNCTIONS OF PHYSICAL TREATMENT

Standardization, Grading and Branding

Packaging

Storage

Transportation

FUNCTIONS FACILITING EXCHANGE

Salesmanship

Advertising

Pricing

Financing

Insurance

SIGNIFICANCE OF MARKETING

Marketing Affects Our Lives

Effect of Marketing on Our Lives.

Marketing Satisfies our needs.

Role of Marketing in Economic Development

Objectives of Marketing

1. To create customers for the business:

2. To satisfy the needs of the customers:
3. To determine marketing-mix that will satisfy the needs of the customers:
4. To generate adequate profits for the business:
5. To earn goodwill for the business
6. 6.To raise standard of living of the people:

Coordination Between Marketing And Other Functions:

Coordination with Purchase and Production Departments

Coordination with Finance Department

Coordination with Human Resource/Personnel Department