1.

1) NEGATIVE DEMAND

The first type of demand is Negative demand. Negative demand occurs when a product is disliked by all
its target customers in general.

The product is good in quality, affordability and many other things but its demand is going negative
because the customer doesn’t need it.

In such cases, it is very difficult for the marketer to sell the product to its customers.

They have to do a lot of convincing and even manipulation of the customer’s mind to achieve their
marketing goal.

Some of the major reasons for this type of demand are defective, irritating market campaigns like
advertising through pop up ads; no customer likes to pop up ads due to which the customer generates a
negative brand image in their mind resulting in negative demand.

Let us understand this demand through an example, services like dental treatments, insurance policies
face a lot of negative demand because people rather than going to a doctor for treatment or taking an
insurance policy, prefer taking preventive measures to avoid buying these services. So the first type of
demand in economics is negative demand.

2) UNWHOLESOME DEMAND

The second type of demand in economics is unwholesome demand. If negative demand is the head,
Unwholesome demand is the tail. Another face of negative demand is unwholesome demand.

They both have almost same elements except there is a single difference between the two which is in
negative demand, a consumer doesn’t feel the urge or requirement to buy the product but in
unwholesome demand consumer badly wants the product but shouldn’t desire or take the decision to
buy it.

These products can be alcohol, pirated movies, firearms, crackers, alcohol, etc. So the second type of
demand in economics is very important for every marketer.

3) NON-EXISTING DEMAND

The third type of demand in economics is known- existing demand. This demand can be very harmful to
any brand if the market research is not accurate.

In this type of demand, a marketer thinks that there is a demand for the product in the market but in
reality, there is no demand for the product.

In many cases, companies lose their market value by not analyzing this demand.

It means if a company keeps producing a certain product thinking that there is the demand for the
product in the market, it will end up suffering huge losses because people will not purchase their
product which results in losing both market share and reputation of the brand.

This type of demand can be more easily be understood by an example- Many educational and computer
courses which are not in demand by the market are one such example of non-existing demand.

Another example can be the mobile phones made by Blackberry and HTC which are not in demand
anymore, still, the companies keep on producing them.

4) LATENT DEMAND

It means that the demand for which the product is not available or is not developed to date.
In today’s time, there are very fewer needs for which any product hasn’t been made or developed. But
still, there are many needs of the people which are unseen by the marketer, the products which are
invented or developed during this type of demand gain almost all of the market of that product as it is
new to everyone.

The best example for studying this type of demand is by studying the evolution of smartphones or
mobile phones.

Every time a new model of a mobile phone was launched, it tackled a new need of the consumer,
whether it would be sending messages, talking face to face via video call, shopping online through
mobiles at one place only and many more.

But there are still many needs that do not have a solution, even though the needs are very important.

5) DECLINING DEMAND

Declining demand as the name suggests means the demand for the product whose demand is declining
with time.

It depends on product to product. It may be due to a new invention in that particular product field, bad
brand marketing or decreasing the quality of the product.

There are various products like technological products in which the coming of new technology results in
declining of previous tech or methods.

This type of demand is majorly seen in technological fields but the food sector, FMCG sector also faces
this as a challenge.

6) IRREGULAR DEMAND

This is the demand due to which a company has to change its marketing strategy from time to time
repeatedly.
In this type of demand, the sales of a product or service fluctuate too much i.e. sometimes it goes to the
extreme top, sometimes it goes to zero.

This happens because of the seasonal or time-based needs of the product.

The customer only wants the product in a certain period or season due to which they only buy the
product in that particular season.

Air conditioners, seasonal clothes are the best day to day things where this irregular demand is seen.

Before the arrival of summers, the sales of the air conditioners and loose and light clothes increase
rapidly but after summers are gone, the sales curve of these goes straight down as there is no demand
for such products in the winter.

7) FULL DEMAND

If a company is having full demand, it is the golden period for that company. It is the state of the market
where the supply is equal to the demand.

It means that the customers for that product are loyal to the brand, the brand also makes sure that each
customer is happy with their product.

It can also be called as full market coverage as most of the market demand has been completely fulfilled
by the company.

The best examples for this type of demand are the demand for smartphones like MI, OnePlus, etc. The
products of these brands get sold out whenever they launch a new model.

8) OVERFULL DEMAND
This demand generates when there is a limited manufacturing capacity of the company for a product,
but the demand for it is more than the manufacturing capacity. It means that demand is more but
supply is less.

The brand equity of the company is highly affected in this type of demand due to which sometimes
companies use De-marketing techniques to decrease the demand for their product so that the sales can
match the demand.

This type of demand can usually be seen in occasional products like the cement industry where the
demand is occasional but very high.

2. Production Concept:

This concept is based on an idea that inexpensive and widely available products generate more sales
because customers prefer those. This is quite similar to the Say’s Law which states ‘Supply creates its
own demand’. So, companies produce the product on a large scale and make sure that it is easily
available everywhere to the customer.

The large scale of production of the product helps the companies to avail the economies of scale which
lead to inexpensive products and thus attracting more customers.

The drawback of this concept is that it focuses only on production but not on the product quality which
in the long run may cause decreased sales if the product is not up to the mark.

This philosophy is only applicable when the demand exceeds the supply. Again, a customer is not always
attracted to an inexpensive product because his/ her purchase decision may be influenced by other
factors.

Applicability of this Concept:

Companies who have a worldwide market for their products may apply this concept.
 Companies enjoying a monopoly advantage may use this concept.

Any company whose product’s demand exceeds its supply may follow it.

Product Concept:

This concept is based on an idea that customers prefer quality products whatever may be their price and
availability. According to this concept, companies concentrate on developing a better quality product
which is usually expensive.

The drawback of this concept is that it focuses only on the product quality but not on other factors like
usability, availability, price, etc. So, it may fail to attract those customers whose attentions are on the
other mentioned factors.

Applicability of this Concept:

Companies belonging to the technology industry may apply this concept.

Companies enjoying a monopoly advantage may use this concept.

Selling Concept:

Selling Concept is only concerned with selling the product whatever may be the quality of the product
and need of the customer. The chief motive is making money, not developing a relationship with the
customers. So, there is less possibility of repeated sales. Companies applying this philosophy can even
deceive the customers to sell their products.

The drawback of this concept is that it lacks foresightedness because the companies focus on selling
what they produce instead of focusing on the need of the market.

Applicability of this Concept:

 Companies only concerned with short-term profits follow this concept which may lead to marketing
myopia, a situation where a company focuses only on selling a product instead of fulfilling customer
needs.

Dishonest or illegal companies may apply this concept.

Marketing Concept:

A company following selling concept cannot have long-term existence in the market because it cannot
fulfill customers’ needs. Companies have to make products fulfilling their customers’ needs to be
successful in today’s era. So, the marketing concept came into existence. This concept is based on an
idea that customers buy the products accomplishing their needs. Companies based on marketing
philosophy perform customer-researches to know their needs and wants and make products to meet
the same better than their competing companies. In this way, the company builds a customer
relationship, becomes profitable and earns goodwill. But still, many companies follow other philosophies
and generate profits. The choice of the concept is totally dependent on the demand, supply, and the
engaged parties’ needs.

Applicability of this Concept:

Businesses engaged in perfect competition may follow this concept.

Businesses who want long-term existence in the market can apply this concept.

Societal Marketing Concept:

The societal marketing concept is based on the marketing concept just adding the philosophy of social
welfare with it. Companies concentrate on fulfilling their customers’ needs as well as contributing to
social welfare without polluting or affecting the environment and natural resources. According to this
concept, company or business being a part of the society has corporate social responsibilities such as
eliminating illiteracy, poverty, controlling alarming population growth, ensuring better health and
treatment facilities, helping victims of different natural calamities like flood, cyclone, excess cold,
draught, etc.
Applicability of this Concept:

Many big reputed companies like banks, TV channels, telecommunication companies, etc. follow this
concept.

Holistic Marketing Concept:

The holistic marketing concept is newly added to the existing marketing management concepts.
According to this concept, a business and its different parts are one single entity and have a common
goal, aligned and integrated activities to achieve that goal. This concept focuses on meeting customer
needs in a better and consistent way as well as performing the social responsibilities.

3. Management information system is a set of systems which helps management at different levels to
take better decisions by providing the necessary information to managers. Management information
system is not a monolithic entity but a collection of systems which provide the user with a monolithic
feel as far as information delivery, transmission and storage is concerned.

MIS Functions

The broad functions of MIS are as given below:

To improve decision-making: MIS helps management by providing background information on a

variety of issues and helps to improve the decision-making quality of management. The fast and
accurate information supplied by MIS is leveraged by the managers to take quicker and better decisions
thereby improving the decision-making quality and adding to the bottom line of the company.

To improve efficiency: MIS helps managers to conduct their tasks with greater ease and with better
efficiency. This reflects in better productivity for the company.

To provide connectivity: MIS provides managers with better connectivity with the rest of the
organization.
4. The Marketing Research is the systematic collection, analysis, and interpretation of data pertaining to
the marketing conditions.

The basic reason for carrying out the marketing research is to find out the change in the consumer
behavior due to the change in the elements of the marketing mix (product, price, place, promotion).

Processes of Marketing Research

1. Define the Problem or Opportunity

The most important part of the marketing research process is defining the problem. In order to do any
research and collect data, you have to know what you are trying to learn from the research. In
marketing research, defining the problem you need to solve will determine what information you need
and how you can get that information. This will help your organization clarify the overarching problem
or opportunity, such as how to best address the loss of market share or how to launch a new product to
a specific demographic.

Develop questions that will allow you to define your problem (or opportunity), and examine all potential
causes so that the research can be whittled down to the information you actually need to solve that
problem or determine what action to take regarding an opportunity. Oftentimes, these are questions
about who your target market or ideal buyer persona is (for example: “What does our ideal customer
look like?”). These might include questions about demographics, what their occupation is, what they like
to do in their spare time—anything to help you get a clearer picture of who your ideal buyer persona is.
Consider as many variables and potential causes as possible.

Data-driven decisions start with good data. Here’s a tactical guide to help teach you How to Do Market
Research.

2. Develop Your Marketing Research Plan

After you’ve examined all potential causes of the problem and have used those questions to boil down
exactly what you’re trying to solve, it’s time to build the research plan. Your research plan can be
overwhelming to create because it can include any method that will help you answer the research
problem or explore an opportunity identified in step one.
To help you develop the research plan, let’s review a few techniques for conducting research:

Interview prospects and customers. Oftentimes, you get the best feedback by using this tactic because
you’re going straight to the source. This might take the form of a focus group or one-on-one interviews.
Use your defined research problem to help select the right people to interview.

Conduct a survey using SurveyMonkey or another tool.

Run user tests on your website or landing page(s). This is a cost-effective approach that can provide a
lot of insight and data on how your customers or potential customers behave or respond to something,
whether it’s new messaging or branding or a modified product or service you are thinking about
offering. Simple A/B tests can go a long way in discovering user behavior. Use heatmapping tools, such
as Hotjar or Lucky Orange, and website analytics tools, such as Google Analytics or HubSpot analytics, to
track results depending on what data you need to collect.

Oftentimes, we do all of this work and gather all of the data—only to realize that we didn’t have to
reinvent the wheel because someone had already run a similar, credible study or solved the same
problem. That doesn’t mean you don’t need to do any research, but learning about what other
organizations have done to solve a problem or seize an opportunity can help you tweak your research
study and save you time when considering all of the research options. In marketing research, this is
called secondary data because it has been collected by someone else, versus the primary data that you
would collect through your own research study.

3. Collect Relevant Data and Information

In marketing research, most of the data you collect will be quantitative (numbers or data) versus
qualitative, which is descriptive and observational. Ideally, you will gather a mix of the two types of data.
For example, you might run an A/B test on your website to see if a new pricing tier would bring in more
business. In that research study, you might also interview several customers about whether or not the
new pricing tier would appeal to them. This way, you’re receiving hard data and qualitative data that
provide more color and insight.
When collecting data, make sure it’s valid and unbiased. You should never ask a research interviewee,
“You think that we should offer a higher pricing tier with additional services, correct?” This type of
question is clearly designed to influence the way the person responds. Try asking both open-ended and
closed-ended questions (for instance, a multiple-choice question asking what income range best
describes you).

4. Analyze Data and Report Findings

Now that you’ve gathered all of the information you need, it’s time for the fun part: analyzing the data.
Although one piece of information or data might jump out at you, it’s important to look for trends as
opposed to specific pieces of information. As you’re analyzing your data, don’t try to find patterns based
on your assumptions prior to collecting the data.

Sometimes, it’s important to write up a summary of the study, including the process that you followed,
the results, conclusions, and what steps you recommend taking based on those results. Even if you don’t
need a formal marketing research report, be sure that you review the study and results so that you can
articulate the recommended course of action. Sharing the charts and data you collected is pointless if it
doesn’t lead to action.

Was your hypothesis proven wrong? Great—that’s why you do testing and don’t run with assumptions
when making decisions that could have a major impact on your organization. It’s always better to take
the results as they are than to twist the data to prove yourself right.

5. Put Your Research into Action

Your research is complete. It’s time to present your findings and take action. Start developing your
marketing strategies and campaigns. Put your findings to the test and get going! The biggest takeaway
here is that, although this round of research is complete, it’s not over.

The problems, business environment, and trends are constantly changing, which means that your
research is never over. The trends you discovered through your research are evolving. You should be
analyzing your data on a regular basis to see where you can improve. The more you know about your
buyer personas, industry, and company, the more successful your marketing efforts and company will
be. When you look at it that way, you should start to wonder why so many organizations don’t budget
time and resources for marketing research.

5. A marketing environment is a combination of internal and external environmental forces and factors
that influences the business operation of a business and its ability to serve its customers. It is essential
to know both internal as well as external environmental factors. Therefore, enterprises keep checking
on them to do their business without any legal trouble and to generate maximum profit.

Types

1. Internal environment

The internal environment is formed of all the internal factors and forces of an organization. The internal
environment of an organization is within the control of the marketer, and he can change or modify the
environment as per the demand in the market and requirement of the business.

The following are the five factors that form the internal environment of an organization. These factors
are also referred to as five Ms of a business.

Money

Men

Markets

Materials

Machinery

All the components of the internal environment are as important as that of the components of an
external environment. However, the internal environment factors are changed according to the change
in the external marketing components. For example, an organization is required to upgrade its
technology if new technology in the market is introduced.

The internal environment of an organization also includes the marketing department, the sales
department, the human resource department, and the manufacturing department.

2. External Marketing environment

The external marketing environment consists of all the external marketing factors that exist outside the
organization, and the marketer has little or no control over the external marketing environment factors.

The external marketing environment can be divided into two categories, such as microenvironment and
the macro environment.

Let us learn about both macro and micro environments one by one.

A. Microenvironment

The microenvironment of a business consists of all the factors and forces that are directly associated
with the company. The micro components of the external environment are also known as task
environments.

The following are the various components of the micro external environment.

1. Suppliers

Suppliers are an essential part of every organization. Suppliers supplies material and all other types of
resources required for the production of products. A company can run its business successfully only if its
suppliers supply material of good quality and on time.

2. Market intermediaries

Market intermediaries are the intermediary parties that help a business to distribute its products in the
market. The market intermediaries can be wholesalers, retailers, and distributors. All of these market
intermediaries are an essential part of the business as they are the face of the company in the market
and represent the products of the company in the market.
3. Partners

Business partners are the business entities that conduct business with the organization. For example,
advertising agencies, banking and insurance companies, market research organization s, brokers, and
transportation companies, etc. A company is required to partner with several other companies to run a
successful business.

4. Customers

Customers are the most crucial component of the business. Customers are the target audience of the
product, and the preference of customers influences all the marketing and business efforts of a
company.

5. Public

The public is people other than the target audience of the organization. The public plays a vital role in
the success of the business as it can build or destroy the image of a company in the market. The public
has the power to influence the purchasing decision of the target audience. Especially in the times of the
internet, the ability to control the public has increased as they can share their views about your
products and services on the internet freely.

6. Competitors

The last but not least component of the microenvironment is the competitors of a business. The
competitors are the other businesses that sell similar products as your products or are part of the same
strategic group in the industry.

B. Macro Environment

Macro components of a marketing environment consist of all external forces and factors that impact the
whole industry rather than just changing an organization directly. Therefore, the macro marketing
environment is also referred to as a large environment.

The following are the six components of the macro environment. Let us learn about them one by one.
1. Technological environment

Technology is one of the elements that have great potential to influence the business of an organization.
It is dynamic, as it changes rapidly. Technology provides several threats and opportunities to the
business environment.

The technological environment consists of research and development in technology, innovation,

inducement of technology, and technical alternatives, etc.

2. Demographic environment

The demographic environment component of the macro marketing environment consists of people that
form a market. The population of the demographic environment can be characterized based on various
factors such as age, gender, density, size, location, race, and occupation, etc.

The demographic environment is a crucial component for business as the company design and builds its
products based on the characteristics of the demographic environment.

3. Social-cultural environment

The social-cultural component of a macro environment is formed using values, lifestyle, culture, beliefs,
and prejudices of the target audience of a business. The social-cultural environment varies from one
region to another region.

People living in one area might prefer a different type of product than the preference of the product of
the people of any other region. Businesses are required to have in-depth knowledge of the social-
cultural environment to design a product or service that is preferred by most people.
4. Economic environment

The economic environment component is a type of component that influences all industries. The
economic environment affects the purchasing power and spending patterns of the buyers.

The following are the different factors that form an economic environment.

Interest Rates.

Gross Domestic Products (GDP).

Gross National Product (GNP).

Inflation.

Subsidies.

Income distribution.

Government funding.

Other significant economic variables.

5. Political-legal environment:

The political-legal environment consists of laws and policies of a country. In addition to rules and
procedures, the political-legal environment also includes agencies and pressure groups. All of these
political entities impact the working capacity of the industry in society.

6. Physical environment:

The last component of the macro environment is the physical environment in which an organization
exists. The following are the components of the physical environment.
 Climate condition

Environmental change.

Availability of the raw material.

Natural resources like water.

pollution.

6.

Political factors

The company/organization needs to consider the political environment when creating business
strategies. The entire political environment includes looking at government policies and the risk and
instability of current political factors. Political risks can include an unexpected loss of ownership due to
government takeover (nationalization), or changes in labour laws which might increase the cost of the
company's workforce. However often business can anticipate issues by performing a political risk
analysis. The political instability can influence the business and the duration of time that business/
organization is profitable.[17]

Taxation Policy

Trade regulations

Governmental stability

Unemployment Policy, etc.

political stability

Economic factors

The economic factors of the business environment are all the variables that impact how the consumer
spends their money and the power of that purchase. There are multiple factors that exist at any time. An
example of an economic factor is the recent recession influenced people to spend less and save more
which has impacted current consumer spending patterns. The economic development of a country Is an
important element when scanning the economic environment.[18] Countries are often categorized as
either 'developing' or 'developed'. The exchange rate of a country can have an extensive impact on the
profitability of a business. Relatively small changes in the exchange rate may be the difference between
profit and loss. When promoting, selling a product it is important for an organization to consider the
extra financial information including current rates, taxes etc. in the economy of the country.[17]

Interest rate

Inflation rate

Growth in spending power

Rate of people in a pensionable age

Recession or Boom

Customer liquidations

Balances of Sharing

Socio-cultural

The socio-cultural environment looks at the demographic characteristics of the current business
environment. It looks at the values, customs and norms of the environment of which a company or
organisation is placed.[18] When looking at the socio-cultural environment it is important to consider
the social values of the environment. Organizations look at the cultural characteristics of the society and
consider all values and customs that are often associated with the culture while they try to market and
sell the product or service,[17] such as:

values, beliefs

language

religion

education

literacy

time orientation

lifestyle.
Technological factors

The technological environment is becoming a lot more important in the modern day business
environment. New technology produces new opportunities for companies and organizations to create,
sell and promote a product. Technology is rapidly growing and forever changing. Telecommunication
technology e.g. cellphones and laptops are increasing the opportunity within an organization to
promote and sell a product. The internet has made information available to the consumer to easily
compare current prices of a product or service with the price of the competitors of the same product or
service. The internet has also created more opportunity to market the product or service via the use of
social media.[18]

Internet

E-commerce

Social Media

Electronic Media

Research and Development

Rate of technological change.

Environmental factors

The environmental factors of the PESTLE analysis include natural resources that are affected by the
processes of selling and marketing products or services. The two main environmental trends that need
to be considered when evaluating the natural environment is the increased pollution and growing
shortage of raw materials, Government regulations are creating practices that encourage environmental
sustainability. A business might for example utilize recyclable and biodegradable packaging, thus making
the most of the environmental opportunities to create a sustainable organizational in the current
natural environment.[18]

Competitive advantage

Waste disposal
 Energy consumption

Pollution monitoring, etc.

Legal factors

The legal environment includes the laws and regulations of a state. The laws and regulations will
influence the way in which an organization will market or sell the product and services. The legal factors
influence trade agreements between different governments and states. The governments that have a
well developed public policy about selling and marketing goods may limit competition and place other
obligations on retailers.[18]

Employment law

Health and safety

Product safety

Advertising regulations

Product labeling

Labour laws etc.[19]

7.

Competitive rivalry

This force examines how intense the competition is in the marketplace. It considers the number of
existing competitors and what each one can do. Rivalry competition is high when there are just a few
businesses selling a product or service, when the industry is growing and when consumers can easily
switch to a competitor's offering for little cost. When rivalry competition is high, advertising and price
wars ensue, which can hurt a business's bottom line.

2. The bargaining power of suppliers

This force analyzes how much power a business's supplier has and how much control it has over the
potential to raise its prices, which, in turn, lowers a business's profitability. It also assesses the number
of suppliers of raw materials and other resources that are available. The fewer supplier there are, the
more power they have. Businesses are in a better position when there are multiple suppliers.

3. The bargaining power of customers

This force examines the power of the consumer, and their effect on pricing and quality. Consumers have
power when they are fewer in number but there are plentiful sellers and it's easy for consumers to
switch. Conversely, buying power is low when consumers purchase products in small amounts and the
seller's product is very different from that of its competitors.

4. The threat of new entrants

This force considers how easy or difficult it is for competitors to join the marketplace. The easier it is for
a new competitor to gain entry, the greater the risk is of an established business's market share being
depleted. Barriers to entry include absolute cost advantages, access to inputs, economies of scale and
strong brand identity.

5. The threat of substitute products or services

This force studies how easy it is for consumers to switch from a business's product or service to that of a
competitor. It examines the number of competitors, how their prices and quality compare to the
business being examined, and how much of a profit those competitors are earning, which would
determine if they can lower their costs even more. The threat of substitutes is informed by switching
costs, both immediate and long-term, as well as consumers' inclination to change.