Fundamentals of Marketing

Chapter: 01 – Introduction to Marketing

Sanjaya Jayasinghe

MCIM, Dip M (UK), MBA (PIM-SJP)

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Learning Outcome

Identifying the fundamental concepts and processes of

marketing

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Marketing is…

Different Institutes, Different People have given different

definitions. However, core remains same.

Needs
Wants

Value creation

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 Marketing is…

 Marketing is the management process that identifies, anticipates and

satisfies customer requirements profitably - The Chartered Institute of
Marketing (CIM)

 Marketing is the activity, set of institutions, and processes for creating,

communicating, delivering, and exchanging offerings that have value
for customers, clients, partners, and society at large - American
Marketing Association (AMA)

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Marketing is…

 The right product, in the right place, at the right time, and at the
right price’ – (Adcock et, al.)

 Marketing is the human activity directed at satisfying human needs

and wants through an exchange process – (Kotler, 1980)

 Marketing is a social and managerial process by which individuals

and groups obtain what they want and need through creating,
offering and exchanging products of value with others’ – (Kotler,
1991)

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Marketing Management

 American Marketing Association

Marketing is the process of planning & executing the
conception pricing , promotion & distribution of ideas, goods &
services to create exchanges that satisfy individual &
organizational goals .

 Kotler
Marketing Management is the Art & Science of choosing
target markets & getting ,keeping & growing customers
through creating ,delivering & communicating superior
customer value

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Evolution of Marketing

 Production Orientation (1850s to Late

1920s)
 Focus of gearing up of manufacturing / Expanding the production
 Era where demand exceeds supply
 No focus on consumer

 Product Orientation
 Assumes that consumers will buy the product that offers them the
highest quality, the best performance, and the most features
 Marketing objectives:
 Quality improvement
 Addition of features

 Sales Orientation (1930 to 1950s)

 Naturally extended from the production orientation
 Focus of selling more of what production is able to produce
 Era where supply exceeds the demand

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Evolution of Marketing

 Marketing Orientation (Mid 1950s)

 Focus more on consumer needs & wants
 Consumer preferences
 Put consumer center in the business

 Relationship Orientation
 Move away from short term customer acquisition
 Focus on customer relationship management
 Long term loyalty & engagements
 Life time value of a customer

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Core Marketing Concepts

Needs, wants and

demand

Exchange, Products and

transaction and services
relationships

Value and
Market satisfaction

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Needs Wants and Demands

 Needs
 Basic human requirements which are biological necessities that is must for
survival of the human beings.
 I am hungry, I need something to eat.
 Wants
 A want is a choice or desire which a person may or may not be able to get,
however life will continue despite the fact that choice or desire get realized.
 I am thirsty, I want SMAK
 Demands
 Demand is an economic principle that describes a consumer's desire and
willingness to pay a price for a specific good or service.

• Some time a want can become a need for customers .

• Marketers can create wants but they can not create needs .
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Value and Satisfaction

 Value
 A fair return or equivalent in goods, services or money for something.

 Satisfaction
 How products and services supplied by a company meet or surpass customer
expectation
 Satisfaction (Delivery = Expectation)

 Dissatisfaction (Delivery < Expectation)

 Delight (Delivery > Expectation)

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Maslow's Hierarchy of Needs

Meeting one’s full potential, can

vary from person to person

Respect, Status, Strengths

Friendship, Intimacy, Family

Bonds

Security, Health, Finance

Food, Sleep, Water

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Products and Services

 Products
 Tangible – Can be touched & feel
 Convenient products
 Buy frequently, immediately, without any comparisons
 Shopping products
 Buy less frequently, evaluate alternatives, take time
 Specialty products
 Brands, unique features, choices
 Unsought products
 Consumer does not know or not actively looking for purchasing
 Industrial products
 Purchase for produce another product or service

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Products and Services

 Services
 Intangible – Can’t be touched & feel
 Inseparable – Can’t separate from the person who provide the
service
 Perishable – Can’t keep for future consumption
 Variable – Quality of the service depend on the person who
delivers the service

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Marketing Planning Process

Situation
Analysis Where are we now?

Setting Goals Where do we want to be?

Marketing
Strategy How do we get there?

Implementation
and Control How do we ensure that we are geting there?

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 Planning Framework

APIC SOSTTMMM SOSTAC

Analysis Where are we now? Situation Situation Analysis
Analysis
Planning Where do we want to be? Objectives Objectives

How might we get there? Strategy Strategy

Targets
Implementation Which way is best? Tactics Tactics
Men
Money Action Plan
Minutes
Control How can we ensure arrival? Control

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Cost & Benefit Analysis

 Business plan should sought monetary benefits which bring share holder value

 The creation of customer value should generate share holder value (Value
base marketing)

 It can be explained as a procedure for estimating all costs involved and

possible profits to be derived from a business opportunity or proposal

 It takes into account both quantitative and qualitative factors for analysis of
the value for money for a particular project or investment opportunity

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Marketing Mix

Tactics action the strategy

Target segment is the determining factor

Flexible

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