Marketing Management Introduction

A 2.
5 Marketing Management
1. Introduction to Marketing
1.1. Nature, Scope and Importance
Meaning of Marketing:
Marketing derived from the word Market. A market is a place where buyers and
sellers come together and exchange products and services. Marketing is a process of
determining the needs and wants of consumers. It helps the customers to provide them
with those products that they are looking for. It helps the company to find out new
customers.
Marketing is a wide term embracing all resources and economic activities needed to
direct the flow of goods and services from producers to consumers. It is a distribution
process so far as businessmen are concerned.
“A total system of interacting business activities designed to plan, price, promote and
distribute want-satisfying products and services to present and potential customers” —
William J Stanton.
It is a modern activity that has developed about the middle of the 20th century as a
scientific process and organised activity and a body of knowledge.
Nature :
“Marketing is the social process by which individuals and groups obtain what they need
and want through creating and exchanging products and value with others." This
definition has less of a focus on profit making organisations and places greater emphasis
on the exchange process.
Nature of Marketing:
1. Marketing is an Economic Function
Marketing embraces all the business activities involved in getting goods and services,
from the hands of producers into the hands of final consumers. The business steps
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A 2.5 Marketing Management
through which goods progress on their way to final consumers is the concern of
marketing.
2. Marketing is a Legal Process by which Ownership Transfers

In the process of marketing the ownership of goods transfers from seller to the purchaser
or from producer to the end user.
3. Marketing is a System of Interacting Business Activities

Marketing is that process through which a business enterprise, institution, or
organisation interacts with the customers and stakeholders with the objective to earn
profit, satisfy customers, and manage relationship. It is the performance of business
activities that direct the flow of goods and services from producer to consumer or user.
4. Marketing is a Managerial function
According to managerial or systems approach - "Marketing is the combination of

activities designed to produce profit through ascertaining, creating, stimulating, and
satisfying the needs and/or wants of a selected segment of the market."
According to this approach the emphasis is on how the individual organisation processes
marketing and develops the strategic dimensions of marketing activities.
5. Marketing is a social process

Marketing is the delivery of a standard of living to society. According to Cunningham and
Cunningham (1981) societal marketing performs three essential functions:
1. Knowing and understanding the consumer's changing needs and wants;
2. Efficiently and effectively managing the supply and demand of products and
services; and
3. Efficient provision of distribution and payment processing systems.
6. Marketing is a philosophy based on consumer orientation and satisfaction

7. Marketing had dual objectives - profit making and consumer satisfaction
Marketing is a never-ending task. Marketing concerns itself with a arranging all the
resources in a way that meets the needs of the customers. The following points will bring
forth the nature of marketing.
1. Marketing is customer oriented: Marketing begins and ends with the customer.
Marketing concerns itself not only with the satisfaction of the customer but also objects
to delight him/her. All the organizational activities must be targeted and focused towards
the customer. Customers must be allowed to decree product specifications and standards
regarding quality. And for this, customer’s needs must be examined continuously.
2. Marketing is the delivery of value: When a customer is satisfied from a particular

product based on its overall performance, then the satisfaction that he has received is
known as customer value. Customers consider the product’s value and price before
making a decision and make a trade-off between cost and benefit of the product. They
will choose a product that gives them more value per rupee. According to De Rose, “Value
is the satisfaction of customer requirements at the lowest possible cost of acquisition,
ownership and use”. Thus, the organization must aim to deliver greater customer value
than that of their competitors.
3. Marketing is network of relationships: The focal point of all marketing activities is the
customer. The term relationships marketing came into light in1990’s. According to Philip
Kotler, “Relationship Marketing is the practice of building long-term satisfying relations
with key parties like customers, suppliers and distributors in order to retain their long
term preference and business.” So, the marketers should aim at maintaining long term
relationships by delivering high quality products, better services and fair prices than
their competitors.
4. Marketing is business: All activities start from marketing i.e. through knowing
customer’s needs and wants and ends on the customer i.e. providing after sales service
and knowing customer dissonance. The entire business revolves around marketing.
Scope:
Marketing has a very wide scope it covers all the activities from conception of ideas to
realization of profits. Marketing is pervasive in scope; any type of entity which is of
value to a market segment can be marketed.
The scope of marketing is determined by the marketing offering of an organization.
Marketing is a process designed to plan, price, promote and distribute want satisfying
products and service. If covers three main activities—concentration, dispersion and
equalization. Marketing confines itself to channels of distribution, marketing functions,
flow of goods and management.
Starting with research to know customer demand through market analysis and
investigation, the scope of marketing extends itself to the employment of resources of
men, money, materials and management with a view to satisfying customer demand.
In today’s world marketing has become almost indispensable for the success of an
organization. Therefore, it is of utmost importance to study the scope of marketing. The
spectrum of marketing covers the following:
1. Marketing Research: Market Research is a tool used for decision making about the
marketing mix’s elements. Research has to be carried out in order to identify the
customer’s needs, their tastes and preferences, their interests, economic position, their
paying capacity and effectiveness of certain advertisements.
For this purpose, data is collected, tabulated, codified, analyzed, and presented
through knowledgeable techniques crafted to reveal what customers will buy, why they
will buy it, and how much they will pay for it. Market research aims at adapting products
to the desires of buyers. Often a questionnaire is used to obtain feedback from the
customers. Marketing managers must play an active role in the research process if the
input is to be useful to them.

2. Pricing: Pricing is extremely important since it directly affects an organization’s sales

and profits. While deciding the price of the product a number of factors have to be kept
in mind like the cost of production, paying capacity of the customer, industry demand,
competitor’s prices and the target profit margin. Price knits together the elements of the
marketing mix and pays for their respective contributions. Therefore, the marketing
manager must analyze and reconcile the various elements of those variables which
influence price, and must then decide on an optimal price policy. A good pricing policy is
a significant factor to attract the customers.
3. Advertising and Sales Promotion: In this era of tough competition, the sales promotion
and advertisements have become almost an inbuilt part of the marketing. It helps to make
the customer aware about the product, makes him curious about the product and thus
promotes sales. There are ample sources of sales promotion and advertisements taking
the decision about which source to be selected is also an imperative part in the sphere of
marketing management. Through advertising marketers are able to position their
products in the minds of the customer using various media like newspapers, magazines,
television, radio, hoardings, window display and internet etc. Marketing managers must
blend the methods of 1) face-to-face personal selling, 2) mass selling to large numbers of
customers through advertising and 3) sales promotion, to inform the target market about
the "right" product.
4. Channels of Distribution: Bringing together the buyer and seller and facilitating their
exchange is the essence of marketing. Distribution channels are an integral part of a
complex system that has evolved from cultural and social patterns in order to facilitate
exchange transactions. Marketers must decide what methods are best for distributing
their particular products. There are various media of distribution like the retai lers, the
wholesalers, department stores, chain stores, super markets etc.
Marketers may choose to sell directly to the customers, to the customers through
sales agents, to jobbers, directly to retailers, or to retailers through sales representatives.
They must also determine as to how much long shall be its channel of distribution. A
number of factors have to be borne in mind while selecting the medium of distribution
like perishability, price of the product, size and weight, after sales service etc.

5. Financing: It is difficult to perform various marketing activities without the availability

of adequate and cheap finance. It has been rightly remarked “Money or Credit is the
lubricant that facilitates the operation of the marketing machine as modern marketing
requires vast resources.” The term financing includes decisions like budgeting for
marketing activities, obtaining the necessary funds needed for operations and providing
financial assistance to customers so they can purchase the business products and
services. In the era of global competition, financing of customer purchasing has become
an important part of marketing. Marketers have to offer different finance schemes to their
customers to increase the volume of sales. There are various sources of marketing finance
like commercial banks, cooperative credit society, government agencies etc. The modern
business is constructed on the foundation of trade credit.
6. After-Sales Service: The furnishing of after sales service is very critical for the
satisfaction of the customers. The free repairs, the return or exchange of the product
during the guarantee period if the product proves defective or worthless, etc. are included
in after sales service.
Importance:
The importance of marketing cannot be over emphasized. It has a special role to

play in a developing country like India. Economic growth, export promotion, and
generation of healthy competition are the direct outcome of marketing which has
a far-reaching consequence on the economy of a country, particularly a developing
country.
Economic growth is promoted by marketing directly “through proper

assessment of the nation’s requirement, better planning of products and
production, better procurement of inputs and distribution of goods and
services and indirectly through widening of the markets, augmentation of
demand and stabilization of the price-level.”
Marketing is a powerful source of foreign exchange avoidance through export

promotion. Scientific marketing helps in generating an atmosphere of genuine and
healthy competition leading to efficiency both in production and distribution

through better utilization of resources.
To sum up, marketing discusses certain benefits that are vital to the economy of
any country—developed and under-developed. It links agriculture with industry
— both farms and factories are benefited. It helps continuous flow of goods from
farm to the farm assuring farmer’s real price for their work and consumers a
steady supply of goods at competitive price.
Mass consumption is encouraged through marketing leading to mass production

and thus, toning up the economy as a whole.
Social gains of marketing are of no mean importance. Employment is generated,
prices become stable by the equation of demand and supply. The development of
suburban areas owing to network of marketing is no mean contribution of
marketing.
Rural economy is strengthened. Advertising in marketing has a very important

impact on the spread of both education and culture. The principles and techniques
of marketing extend their influence to non-business institutions which are
benefitted in various ways by following the principles inherent in marketing.
Modern economy, therefore, owes much to marketing and, as such, marketing is

attaining significance with the onward march of time.
The importance of marketing can be summed up as follows:

(a) Creation of demand for goods and services,
(b) Betterment in the standard of living,
(c) Creation of social utility,
(d) Special benefit to developing countries,
(e) Maintenance of survival and mobility of business,
(f) Sense of security,
(g) Maintenance of balance between demand and supply,
(h) Means of living,
(i) Export promotion,

(j) Sales promotion,
(k) Increase in the risk bearing capacity.
P. F. Drucker remarked “Marketing is the foundation of business. Marketing is

not a function of business but a view of the entire business seen as the
economic organ to provide goods and services. That is a marketing view of
business. Everything the business does in that respect is marketing.”
This remark of a great authority like Drucker is a sufficient justification of the

importance of marketing.
1.2. Definition, Evolution, Marketing Orientations (Concepts)
Introduction
In today's world of marketing, everywhere you go you are being marketed to in
one form or another. Marketing is with you each second of your walking life. From
morning to night you are exposed to thousands of marketing messages everyday.
Marketing is something that affects you even though you may not necessarily be
conscious of it.
Definition of Marketing
According to American Marketing Association (2004) - "Marketing is an
organisational function and set of processes for creating, communicating and
delivering value to customers and for managing relationships in a way that benefits
both the organisation and the stakeholder."
AMA (1960) - "Marketing is the performance of business activities that direct the
flow of goods and services from producer to consumer or user."

According to Eldridge (1970) - "Marketing is the combination of activities

designed to produce profit through ascertaining, creating, stimulating, and
satisfying the needs and/or wants of a selected segment of the market."
According to Kotler (2000) - "A societal process by which individuals and groups
obtain what they need and want through creating, offering, and freely exchanging
products and services of value with others."
Marketing is the process of getting potential clients or customers interested in

your products and services. The keyword in this definition is "process". Marketing
involves researching, promoting, selling, and distributing your products or
services.
This discipline centers on the study of market and consumer behaviors and it
analyzes the commercial management of companies in order to attract, acquire,
and retain customers by satisfying their wants and needs and instilling brand
loyalty.
Marketing is a business term that experts have defined in dozens of different

ways. In fact, even at company level people may perceive the term differently.
Basically, it is a management process through which products and services move
from concept to the customer. It includes identification of a product, determining
demand, deciding on its price, and selecting distribution channels. It also includes
developing and implementing a promotional strategy.
Collins Dictionary has the following definition of the term:

“Marketing is the organization of the sale of a product, for example, deciding on its
price, the areas it should be supplied to, and how it should be advertised.”
Below is the American Marketing Association’s definition:
“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.”

Evolution of Marketing:
Evolution of marketing means slow and gradual development of marketing over
the years. The fact that marketing is virtually everywhere in today’s free-market
economies is a dramatic change from a few decades ago. Marketing emerged as a
discrete discipline in the early 1900s, but it didn’t affect most companies right
away. Many businesses went through distinct phases on their way to becoming
marketing oriented.
Marketing has changed over the centuries, decades and years. The production
centered system systematically changed into relationship era of today and over
the period; the specializations have emerged such as sales versus marketing and
advertising versus retailing.
The overall evolution of marketing has given rise to the concept of business
development. Marketing has taken the modern shape after going through various
stages since last the end of 19th century. The Production oriented practice of
marketing prior to the twentieth century was conservative and hidebound by
rules-of-thumb and lack of information. Science & technology developments and
specially the development of information technology have now changed the way
people live, the way people do business and the way people sell and purchase.
Following is a short summary of the various stages of evolution of marketing.
Contents -
• Production Orientation Era
• Product Orientation Era
• Sales Orientation Era
• Marketing Orientation Era
• Relationship Marketing Orientation Era
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Production Orientation Era

The prevailing attitude and approach of the production orientation era was -
“consumers favor products that are available and highly affordable” . The mantra
for marketing success was to “Improve production and distribution”. The rule
was “availability and affordability is what the customer wants”. The era was
marked by narrow product-lines; pricing system based on the costs of
production and distribution, limited research, primary aim of the packaging was
to protect the product, minimum promotion. Advertising meant, “Promoting
products with a lesser quality”.
Product Orientation Era

The attitude changed slowly and approach shifted from production to product
and from the quantity to quality. The prevailing attitude of this period was that
consumers favor products that offer the most quality, performance and
innovative features and the mantra for marketers was ‘A good product will sell
itself’, so does not need promotion.
Sales Orientation Era

The increased competition and variety of choices / options available to
customers changed the marketing approach and now the attitude was
“Consumers will buy products only if the company promotes/ sells these
products”. This era indicates rise of advertising and the mantra for marketers
was “Creative advertising and selling will overcome consumers’ resistance and
convince them to buy”.
Marketing Orientation Era

The shift from production to product and from product to customers later
manifested in the Marketing Era which focused on the “needs and wants of the
customers” and the mantra of marketers was ‘The consumer is king! Find a need
and fill it’. The approach is shifted to delivering satisfaction better than
competitors are.
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Relationship Marketing Orientation Era

This is the modern approach of marketing. Today’s marketer focuses on needs/
wants of target markets and aims at delivering superior value. The mantra of a
successful marketer is ‘Long-term relationships with customers and other
partners lead to successes.’
The following sentences summarize the above evolution of marketing.

1. Production era: ‘Cut costs. Profits will take care of themselves’.
2. Product era: ‘A good product will sell itself’.
3. Sales era: ‘Selling is laying the bait for the customer’.
4. Marketing era: ‘The customer is King!’.
5. Relationship marketing era: ‘Relationship with customers determine our firm’s
future’.
According to the Evolution of Marketing Philip Kotler, marketing has progressed

through five stages since the dawn of the Industrial Revolution: the production era, the
product era, the selling era, the marketing era and the holistic era.
Marketing Orientations :
An organisation focus (and subsequently its marketing) is centred around five key
categories, classified into the following orientation groups: Production orientation,
product orientation, sales orientation, societal orientation and market orientation.
What is Market Orientation?

Market orientation is a business approach wherein the processes of product
development and creation are focused on satisfying the needs of consumers. It is
a type of marketing orientation technique that designs products with qualities
that consumers want, which is completely different from the conventional
marketing approach.
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The five marketing orientations and their advantages and disadvantages

Whereas marketers and marketing teams can usually dictate the marketing
strategies it adopts, it cannot always dictate the organisation's marketing
orientation.
An organisation focuses onto five key categories, classified into the following
orientation groups:
Production orientation,
product orientation,
sales orientation,
societal orientation and
market orientation.
These approaches dictate the priorities and processes existent within the
organisation, and perhaps more importantly, the manner in which the
organisation takes its core offering to market and how it empowers its marketing
teams.
Here’s a look at each in more detail.
PRODUCTION ORIENTATION
A production orientated organisation commonly operates a mass production
model and streamlines this production process for its product offering. This
orientation approach assumes that its customers value price, and therefore, it
focuses on lowering production costs to meet such price needs of this customer
base.
This price is believed to form the main value proposition of the production
orientation organisation’s key offering, focusing its resources towards operations
and positioning its key marketing communications on price-based messages.
This assumption that price is king, however, isn’t always indicative of the needs
and wants of the target audience as the approach does not require learning
anything about the customer base. It assumes that its customers want the
cheapest product available and will strive to realise this price.
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Advantages: Economies of scale, efficiency, low cost to customers.

Disadvantages: Disregards customer needs, set-up costs are usually high.
PRODUCT ORIENTATION
It is sometimes assumed that a product orientation approach is similar to a
production orientation approach. But it is exactly the opposite. This approach to
business concerns its products and continually improving and refining them so
that the product can always be superior to that of its competitors. So, as the
previous orientation was centred around price, product orientation is centred
around quality, which often increases the price.
Premium products fall into this category, but the approach does not always offer
what its target audience actually wants or considers the factors that the audience
uses to form its purchasing decision.
Quality – and therefore a product orientated organisation – often does not
consider external factors, and focuses on manufacturing a high-quality, premium
product that is superior within the market it operates and competes within.
Advantages: Focus on quality, innovation, skills development/outsourcing.
Disadvantages: Potential missed market opportunities, obsolescence.
SALES ORIENTATION
A sales orientated organisation focuses the majority of its resources on selling its
products and services to its target audience. In a way, it does prioritise its
customers but not in a sense of listening to their needs and wants – it simply wants
to sell to them.
Existing products are usually given to the sales and marketing teams and they are
tasked to finding buyers to those products, wherever and whoever they may be.
Many organisations will feel they are not selling enough of their products and will,
therefore, adopt sales orientated techniques to focus the organisation on selling
more and building on its profit margins.
Disregarding customer needs in this way, and adopting aggressive outbound sales
techniques, is an approach that rarely works in the long term. This is especially
the case now that the general “customer” (regardless of industry) is more
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empowered than ever and appreciates relationships within the sales processes,
especially within the B2B pharma sectors. That said, this isn't to say that
organisations cannot be successful with this approach. The inbound
sales/marketing approach has emerged as attractive in modern-day sales
orientated organisations.
Advantages: Immediate short-term sales are generated.
Disadvantages: Risks customer confidence, costs, not always sustainable.
SOCIETAL ORIENTATION
As people generally become more aware of their environments, the world and the
societies they live within, the societal orientation approach has emerged, giving
organisations a new organisational philosophy.
The societal orientation organisation, considering its product, process and its
marketing, to an extent, focuses on the impact its organisation and products has
within the societies it operates within, as well as the wider environment. Ethical
considerations in this manner have become highly popular within the
pharmaceutical and life science industries.
In competitive markets, however, this approach can be challenging to sustain –
especially for small to medium size organisations where profits and customer
satisfaction can affect how it can execute the environmental and societal
orientation approach.
Advantages: Image is enhanced, appeals to upcoming markets, ethical.
Disadvantages: Marketing message is sometimes distorted, limited budget.
MARKET ORIENTATION
A market orientated organisation looks at the market and its target audience first,
before any production or sales activities takes place, to learn what potential
customers want from organisations. The product or service offering is therefore
created with the customer in mind, resulting in a true customer-first approach.
Market orientation, in marketing strategy terms, commonly revolves around
culture, values and other internal behaviours focused on satisfying customer
needs that are usually well-researched prior.
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Although this clearly has its benefits, it can also come at a cost to organisations as
it usually puts organisations on the back foot, always reacting to customer
demands rather than predicting or shaping them with innovative products and
services. This said, most markets are moving more towards a market-orientated
approach as customers have more and more access to information about what
they are looking to buy.
Advantages: Customer satisfaction, loyalty, continual investment in research.
Disadvantages: Reactive, not always innovative, market always changing.
WHICH MARKETING ORIENTATION APPROACH BEST REPRESENTS YOUR

ORGANISATION?
If you are a marketing professional reading this post, it is likely that you will favour
the market-orientated approach by nature. However, this doesn't mean that such
an approach is indicative of how you should conduct your marketing within your
organisation. Its orientation approach is formed around how your organisation
was established and how it operates, as well as its challenges, rather how you see
marketing as a discipline.
These marketing orientation approaches to business – and marketing – are all
present within today’s business landscapes, but they are also representative of
how business and marketing thinking has changed within the last 100 years.
In some industries, shifting from the production approach (Ford Motor Co.) to a
product approach (Apple) to a sales approach (Amazon) to a market approach
(Google) to now a societal approach (The Body Shop). All examples of successful
organisations.
In the conventional approach, the business prioritizes the promotion of existing

products by establishing features that can be key selling points. Companies like
Amazon and Coca-Cola use market orientation principles while companies in the
luxury goods market, such as Louis Vuitton or Chanel, follow the conventional
approach.

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Summary
• Market orientation is a marketing approach wherein the processes of
product development and creation are focused on satisfying the needs of
consumers.
• Marketing orientation is the business approach that dictates all the
processes within that organization. It comes in several types: sales
orientation, market orientation, production orientation, and societal
orientation.
• Market orientation offers several advantages, including product
differentiation and increased consumer satisfaction.
Understanding Marketing Orientation

Marketing orientation is the business approach that dictates all the processes
within that organization. It outlines how the company’s core offering is presented
to its users and how the marketing teams are empowered.
Although marketing teams have a say in the marketing strategies adopted, the
marketing orientation is determined by the priorities of upper-level management.
The different types of marketing orientation are as follows:
1. Sales orientation
2. Market orientation
3. Production orientation
4. Societal orientation
How Does Market Orientation Work?

Market orientation is more of an approach to product design rather than
promotion. It means that the priority is to analyze the target audience and
determine their needs instead of undertaking any promotional or sales activity.
The needs are kept in mind while developing and upgrading the product offering.
A market-oriented organization uses a customer-centered approach, which means
that the most pressing concerns, immediate needs, and personal preferences of
the consumer base must be researched.

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The strategy must be focused on values, culture, and other behavioral traits of the
consumer base. Thus, the development efforts of the organization are focused on
characteristics that are most widely demanded. This enables companies to adapt
to different markets and enhance competitiveness.
Advantages of a Market-Oriented Strategy

• Most consumers are in touch with market trends, too, and clearly understand their
needs and aspirations. Performing data analysis can reveal trends and desires that
are not explicit. It can be instrumental in anticipating consumer needs and
adapting the market-oriented organization as one that shapes consumer behavior
rather than one that reacts to it.
• Consumer demands can often seem impractical, but their knowledge can be vital
in the long-range decision-making process. Ideas that are not cost-effective in the
status quo can be employable amid changed market conditions in the future. They
can be used for long-term development strategies.
• Data collected for product development can also be used post-launch to improve
customer service. Efficient product support that addresses concerns raised by
consumers is essential in maintaining a high degree of consumer satisfaction. It
enhances brand loyalty and word-of-mouth advertising by existing consumers.
Disadvantages of a Market-Oriented Strategy

• An excessive focus on addressing the needs and desires of consumers reduces the
scope for innovation in an organization. Thus, market orientation is based on
reacting to market trends rather than creating them.
• Consumer desires are not fixed and can change very rapidly. A standalone market-
oriented strategy cannot guarantee a huge market share, given that rival
companies serving the same consumer needs can quickly come up in the market.
Examples of Market-Oriented Companies

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Amazon consistently changes the virtual marketplace and adds features to

address the concerns expressed by consumers. One such feature is the rating and
review system introduced by the online retailer to boost credibility.
The company launched Amazon Prime to address issues with delivery charges. In
addition, it created the Amazon Locker, which is a self-pickup service for
consumers who may not be present in the shipping address indicated at the time
of delivery.
Coca-Cola performs extensive research to come up with new flavors for its
consumers. For users who are worried about sugar content, the company
launched the zero-calorie Diet Coke and undertook several acquisitions of
“healthy” brands, such as Dasani, etc.
1.3. Marketing Process, Developing the Marketing Mix, The role of marketing mix in
planning and strategy
Marketing Process:
Marketing process includes ways in which value can be created for the customers to
satisfy their requirements. It is an endless series of actions and reactions between the
customers and the companies making attempt to create value for and satisfy the needs of
customers.
In marketing process, the situation is examined to identify opportunities, the strategy is
formulated for a value proposition, tactical decisions are taken, plan is executed, and
results are monitored.
The following four steps are involved in the marketing process −

Situation Analysis
Analysis of the situation in which the company finds itself serves as the basis for
identifying chances to satisfy unfulfilled customer needs.

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Situational and environmental analysis is done to identify the marketing options, to

understand the company’s own capabilities and to understand the surroundings in which
the company is operating.
Marketing Strategy
After identifying the marketing options available, a strategic plan is developed to pursue
the identified options. An analysis is done and the best available option is chosen; a plan
or strategy is made for that option.
Marketing Mix Decisions
At this step, elaborated tactical decisions are made for the controllable parameters of the
marketing mix. It includes decisions related to product development, product pricing,
product distribution and product promotion.
Implementation and Control

Finally, the marketing plan is executed and the outputs of marketing efforts are
monitored to adjust the marketing mix according to the market changes.
This being the final step, it transforms the written or planned strategy into action and the
product is presented according to this process.
Marketing Process: 5 Steps of Marketing Process

Marketing is how companies create value for customers and build strong customer
relationships to capture value from customers in return. 5 step process of the marketing
framework wherein value is created for customers and marketers capture value from
customers in return.
1. Understanding The Marketplace And Customer Needs And Wants.
2. Designing A Customer-Driven Marketing Strategy.
3. Constructing an integrated marketing plan that delivers superior value.
4. Build Profitable Relationships.
5. Capturing Value From Customers.

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Step 1: Understanding The Marketplace And Customer Needs And Wants

It is important to understand customer needs, wants, and demands to build want-
satisfying market offerings and building value-laden customer relationships. This
increases long-term customer equity for the firm.
Needs – States of felt deprivation
They include the physical need for necessities like food, clothing, shelter, warmth, safety,
and individual needs for knowledge and self-expression. The marketers cannot create
these needs as they are a basic part of human markup.
Wants – The forms of human needs take as shaped by culture and individual
personality.
Wants are shaped by one’s society and are described in terms of objects that will satisfy
needs.
For example, an American in Dhaka needs food but wants McDonald’s.
Demands – Human wants that are backed by buying power.

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Given their wants and resources, people demand products with benefits that add to the
most value and satisfaction.
Step 2: Designing A Customer-Driven Marketing Strategy

Focus areas for designing a marketing strategy:
• Selecting customers to serve -defining the target market
• Deciding how to serve customers in the best way – choosing a value proposition
Selecting customers to serve:
The company first decides who it will serve and divides the market into segments of the
customer. Then it goes after specific sections of the market or its target market.
They target customers based on their level, timing, and nature of demand.
Choosing a value proposition

They decide how it will serve their customer. That is how it will differentiate and position
itself in the market. A brand’s value proposition is the set of values and benefits that it
promises to deliver its customers.
Companies need to design strong value propositions to give them the greatest advantage
in their target markets.
5 alternative concepts for designing a customer-driven marketing strategy are;

1. Production concept: Consumers will favor products that are available and highly
affordable. Management should focus on improving production and distribution
efficiency.
2. Product concept: Consumers will favor products that offer the most quality,
performance, and innovative features. Focus on making continuous product
improvements.
3. Selling concept: Consumers will not buy enough of the firm’s products unless it
undertakes a large-scale selling and promotion effort. It is typically practiced with
unsought goods that the company needs to sell and generally results in aggressive
selling practices. The company sells what it makes rather than what the market
wants.

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4. Marketing concept: Organizational goals are achieved by knowing the target

markets’ needs and wants and delivering the desired satisfactions better than
competitors do.
5. Societal concept: Marketing strategy should deliver value to customers in such a
way that improves both customers as wells as society’s well being and long-run
interests.
Step 3: Constructing an integrated marketing plan that delivers superior value

The company’s marketing strategy outlines which customers the company will serve and
how it will create value. Then the marketer develops integrated marketing plans that will
the intended value to target customers.
It consists of the firm’s marketing mix (4Ps), the set of marketing tools the firm uses to
implement its marketing strategy.
The marketing program builds customer relationships by transforming the marketing
strategy into action.
For this, it needs to blend all of these marketing tools into a comprehensive, integrated
marketing program that communicates and delivers the customers’ expected value.
Step 4: Build Profitable Relationships
Customer relationship management is the overall process of building and maintaining
profitable customer relationships by delivering superior customer value and satisfaction.
Customer relationship management aims to produce high customer equity, the total
combined customer lifetime values of all of its customers.
The key to building lasting relationships is the creation of superior customer value and
satisfaction.
Companies today want to acquire profitable relationships and build relationships that
will increase their share of the customer portion of the customers purchasing that a
company gets in its product categories.
Step 5: Capturing Value From Customers
Customer relationship management’s ultimate aim is to produce high Customer equity –
total combined lifetime values of all of the company’s current and potential customers.

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The more loyal to the company’s profitable customers, the higher are the customer
equity. Customer equity may even be a better way to measure its performance than
market share or current sales.
Marketers cannot create customer value and build customer relationships by themselves.
They need to work closely with other company departments and with partners outside
the firm.
In addition to being good at customer relationship management, they also need to be
good at partner relationship management.
Final Words Managing Marketing Process
The last step of the marketing process is arranging resources necessary to carry out the
marketing plan, putting the plan in action, and exerting control.
For the implementation of the marketing plan, the firm needs to build a marketing
organization.
This type of organization consists of many specialists responsible for carrying out
marketing research, advertising, product development, customer service, etc.
Such an organization calls for setting up a department called the marketing department
headed up by a Vice-President/Director/GM. He usually performs three types of tasks.
First, he coordinates activities performed by different personnel in the marketing
department.
Second, he must closely work with other key personnel charged with other
responsibilities, such as personnel, finance, etc.
Third, he must perform several operative and technical functions as selecting, training,
directing, motivating, and evaluating his department’s personnel for better performance
by each of them.
When the plan is implemented, management must make sure that everything is going
fine. He can ensure this by receiving feedback and taking corrective action if necessary,
i.e., controlling.
What is the marketing mix?

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Once a firm has defined its target market and identified its competitive advantage, it can
create the marketing mix, which is based on the 4Ps discussed earlier, that brings a
specific group of consumers a product with superior value. Every target market requires
a unique marketing mix to satisfy the needs of the target customers and meet the firm’s
goals. A strategy must be constructed for each of the 4Ps, and all strategies must be
blended with the strategies of the other elements. Thus, the marketing mix is only as good
as its weakest part.
The marketing mix in marketing strategy: Product, price, place and promotion
The marketing mix is the set of controllable, tactical marketing tools that a company
uses to produce a desired response from its target market. It consists of everything that
a company can do to influence demand for its product. It is also a tool to help marketing
planning and execution.
The four Ps of marketing: product, price, place and promotion
The marketing mix can be divided into four groups of variables commonly known as the
four Ps:
1. Product: The goods and/or services offered by a company to its customers.
2. Price: The amount of money paid by customers to purchase the product.
3. Place (or distribution): The activities that make the product available to
consumers.
4. Promotion: The activities that communicate the product’s features and benefits
and persuade customers to purchase the product.
Marketing tools
Each of the four Ps has its own tools to contribute to the marketing mix:

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• Product: variety, quality, design, features, brand name, packaging, services
• Price: list price, discounts, allowance, payment period, credit terms
• Place: channels, coverage, assortments, locations, inventory, transportation,

logistics
• Promotion: advertising, personal selling, sales promotion, public relations
Marketing strategy
An effective marketing strategy combines the 5 Ps of the marketing mix. It is designed to

meet the company’s marketing objectives by providing its customers with value. The 5 Ps
of the marketing mix are related, and combine to establish the product’s position within
its target markets.
For example, an excellent product with a poor distribution system could be doomed to
failure. An excellent product with an excellent distribution system but an inappropriate
price is also doomed to failure. A successful marketing mix requires careful tailoring.
For instance, at first glance you might think that McDonald’s and Wendy’s have roughly
the same marketing mix. After all, they are both in the fast-food business.
But McDonald’s targets parents with young children through Ronald McDonald, heavily
promoted children’s Happy Meals, and in-store playgrounds.
Wendy’s is targeted to a more adult crowd. Wendy’s has no playgrounds, but it does have
flat-screen TVs, digital menu boards, and comfy leather seating by a fireplace in many
stores (a more adult atmosphere), and it has expanded its menu to include more items
for adult tastes.
Product Strategy
Marketing strategy typically starts with the product. Marketers can’t plan a distribution
system or set a price if they don’t know exactly what product will be offered to the market.
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Marketers use the term product to refer to goods, services, or even ideas. Examples of
goods would include tires, MP3 players, and clothing.
Goods can be divided into business goods (commercial or industrial) or consumer

goods. Examples of services would be hotels, hair salons, airlines, and engineering and
accounting firms. Services can be divided into consumer services, such as lawn care and
hair styling, or professional services, such as engineering, accounting, or consultancy.
In addition, marketing is often used to “market” ideas that benefit companies or

industries, such as the idea to “go green” or to “give blood.” Businesses often use
marketing to improve the long-term viability of their industries, such as the avocado
industry or the milk industry, which run advertising spots and post social media
messages to encourage consumers to view their industries favourably. Thus, the heart of
the marketing mix is the goods, services or ideas. Creating a product strategy involves
choosing a brand name, packaging, colors, a warranty, accessories, and a service program.
Marketers view products in a much larger context than is often thought. They include not
only the item itself but also the brand name and the company image. The names Ralph
Lauren and Gucci, for instance, create extra value for everything from cosmetics to bath
towels. That is, products with those names sell at higher prices than identical products
without the names. Consumers buy things not only for what they do, but also for what
they mean.
Developing the Marketing Mix:

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Once you have identified your target audience and the competition, the next thing on your to-
do list should be developing a marketing mix.
Every business needs its very own marketing mix to appeal to its customers. The marketing
mix definition, its importance, the elements of marketing mix and how to develop an effective
marketing mix for your product or service.
How to Develop a Marketing Mix?
Define Your Goal and Set a Budget
Developing an effective marketing mix starts with setting the right goals. Establish what you
want to achieve with your marketing plan; is it to grow sales? Acquire more customers? Build
brand awareness?
Once you have set realistic and measurable goals, determine how much you are willing to spend
on achieving your objectives.
Study Your Target Customer
In order to build a product or service that your customers would want to buy, you need to know
who they are.
Find different segments in your target audience and create separate customer profiles for each.
Refer to these when you are developing your strategies.
Identify Your Unique Selling Proposition
Clarify what your unique selling proposition is through customer surveys, interviews, focus
groups etc.
Here you will identify the benefits your product or service will bring to your customer, and
how you are better than anyone else in solving their problems.

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Understand Your Competition
Carry out a competitor analysis to understand the different strategies and tactics used by your
competitors. This knowledge will be especially helpful when you are creating your pricing
strategy.
Identify the Unique Features of Your Product
List down the unique qualities and the value of your product. You can build on these when you
are marketing it to your customers.
Create a Pricing Strategy
Using the competitor research, you have done, build a pricing strategy. Make sure that you
have not overpriced or under-priced your product.
Choose Your Distribution Channels & Promotional Methods
Choose the channels you will be distributing your product through based on the type of your
product or service and your target customer.
And select the promotional techniques you want to choose based on your budget, and again the
customer and your product.
The role of marketing mix in planning and strategy
As a learning tool
While one of the limitations of the traditional 4P’s marketing mix is that it is quite
simplistic, that means it is also an excellent approach to learning the scope of marketing.

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Marketing students are typically introduced to the concept of the traditional marketing
mix in their introductory marketing studies – it is usually one of the first concepts taught.
Highlights a broader scope of marketing
For many years, marketing was primarily associated with simply advertising and
promotion. The 4P’s marketing mix structure, however, clearly highlights that promotion
is simply one of the four elements. At the centre of the marketing mix is product – for
without a product offering, it is impossible for an organization to offer any value to an end
consumer and it is impossible for the firm to create profitability for itself.
A handy checklist
The marketing mix is handy as a top-level checklist of the key components of any
integrated marketing program. When a marketer is developing their marketing strategy
and documenting their marketing plan, the marketing mix can act as an overall checklist,
or control, to ensure that they have considered the broader aspects of marketing.
The impact of synergy
The components of the original marketing mix (Product, Price, Place, Promotion) need to
be mixed in an appropriate proportion so the organization meets its marketing
objectives. In this situation, the marketer becomes a “mixer of ingredients” constantly
engaged in building a creative mix of marketing procedures and instruments in order to
render the organization profitable.
Philip Kotler has stated that “the marketing mix is the set of controllable variables
that the firm can use to influence the buyer’s response". Therefore, the marketing
mix is an useful tool for any marketer by helping him keep in focus all the variables
involved in this particular process.
Marketing mix in combination delivers the marketing strategy
The marketing mix helps a marketer to realize that the four main components work
together and should be regarded as a unit. Very often, decisions made regarding one
variable may influence the choices of another element. By seeing the marketing mix as an
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integral tool, marketers will be able to build an effective strategy and attach the right
tactics for its accomplishment. Selecting the right marketing mix will take a lot of effort
before finding the right balance of the elements involved.
Create customer value
By following the 4 components (Product, Price, Place, Promotion) of the marketing mix,
an organization will be able to create value for its customers and communicate through
in an integrated approach. Customers will perceive this value in the quality of the product,
its associated price and discounts, through the quality of the distribution and placement
and finally by its advertising campaigns.
Flexible options
There is no perfect marketing mix, due to the infinite combinations of the elements
involved. The same product may have different marketing mixes for different target
markets. Also, no marketing mix is constant; it should be adapted to the requirements
and changes of the environment it concerns. But one thing is certain, the different
elements of the mix should not pull the organization in different directions, they should
consolidate a single position within a certain market segment.
1.4. Ethical Issues in Marketing - Ethical Behaviour, Understanding Ethical Conduct,

Marketing Related Ethical Issues, Encouraging Ethical Behaviour
What Is Ethical Marketing? Before we dive into the examples, let’s take a moment to
clarify what ethical marketing means.
Ethical marketing refers to the process by which companies market their goods and
services by focusing not only on how their products benefit customers, but also how they
benefit socially responsible or environmental causes.
To put this another way, ethical marketing isn’t a strategy; it’s a philosophy. It includes
everything from ensuring advertisements are honest and trustworthy, to building strong
relationships with consumers through a set of shared values. Companies with a focus on

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ethical marketing evaluate their decisions from a business perspective (i.e. whether a
particular marketing initiative will deliver the desired return) as well as a moral
perspective (i.e. whether a decision is “right” or morally sound).
ETHICS IN MARKETING
Ethics are a collection of principles of right conduct that shape the decisions people or
organizations make. Practicing ethics in marketing means deliberately applying
standards of fairness, or moral rights and wrongs, to marketing decision making,
behavior, and practice in the organization.
In a market economy, a business may be expected to act in what it believes to be its own
best interest. The purpose of marketing is to create a competitive advantage. An
organization achieves an advantage when it does a better job than its competitors at
satisfying the product and service requirements of its target markets. Those
organizations that develop a competitive advantage are able to satisfy the needs of both
customers and the organization.
As our economic system has become more successful at providing for needs and wants,
there has been greater focus on organizations' adhering to ethical values rather than
simply providing products.
Ethical Issues in Marketing:
Ethical issues in marketing arise from the conflicts and lack of agreement on particular
issues. Parties involved in marketing transactions have a set of expectations about how
the business relationships will take shape and how various transactions need to be
conducted. Each marketing concept has its own ethical issues-
Marketing refers to activities of a company associated with buying and selling a product
or service. Marketing through advertising, selling and delivery of products to potential
customers, is vital for the success of any business. Since it has the potential to influence
attitudes, behaviours and priorities, ethical considerations are part and parcel of
marketing.
Ethical issues involved in marketing:

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1. Privacy: Organisations today collect, store and process information relating to

customers to be used for targeted advertising. In such cases the concerns for
privacy require an effort for informing the customers and acquiring their consent.
2. Stereotyping: Marketing campaigns based on generalized studies or common

perceptions about behaviours and values of certain demographic groups raise
important ethical issues. For example, often women are matched up with
household products such as cleaning supplies and are shown as doing domestic
work.
3. Objectivity: The concern for objectivity is a vital issue in marketing. The lack of
objective research on part of the market researcher may legitimize profiting from
poverty, cultural stereotypes and racial tensions.
4. Vulnerable targeting: Targeting an audience such as children involves ethical

consideration. Children have always been an important marketing target for
certain kinds of products.
5. Unethical market exclusion: The absence of minority groups in marketing in a

multi-ethnic society can create image and identity problems among those that are
excluded. For instance the adverse industry attitudes to the homosexual,
transgender and ethnic minority.
6. Unintended advertising channels: Direct marketing is the most controversial of

advertising channels, particularly when approaches are unsolicited. TV
commercials and e-mail are common examples. Electronic spam and
telemarketing push the borders of ethics and legality more strongly.
7. Misleading advertising: Many advertisings are misleading. For example,

misleading the public by showing turning a black face into white.
8. Negative advertising techniques: The advertiser highlights the disadvantages of

competitor products rather than the advantages of their own.
9. Anti-competitive Practices: For instance, Predatory pricing which is practice of

selling a product or service at a very low price, intending to drive competitors out
of the market, or create barriers to entry for potential new competitors.
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10. Use of brand ambassadors: Ambassadors endorsing products they don’t use or
whose authenticity they don’t cross check, making profits out of public’s reverence
of a person, high cost of celebrity eventually extracted from public, puts newer and
smaller brands at a disadvantage hurting fair competition.
Resolving Ethical Issues in Marketing:
1. Regulation: More than external regulation, marketing needs internal controls and
self-regulation. The organisations are expected to develop principles of ethics to
guide the marketing process. The establishment bodies such as Advertising
Standards Council of India (ASCI) can be seen as a step in this direction.
2. Consumer protection: Various Consumer laws protects consumers and

competition law protects competitors from unethical practices. Apart from these
regulators like CCI, TRAI, IRDA etc. may also be approached for grievance
redressal.
3. Customer participation: Generally, a customer is regarded as only a recipient of

products or services. However, if the marketer involves the customer and does
things in interaction with the customer it may work to reduce two potential ethical
dilemmas of consumer autonomy vs. marketing effectiveness and consumer
participation.
4. Taking responsibility: An organization should take the responsibility of its

actions. The responsibility also extends to the employees and other organizations
that the firm deals with like suppliers or dealer agencies. The organization should
make sure that any marketing decisions and actions meet the customers’ needs
and actions should also cater to the broader needs of the society.
5. Balance the Interests: Marketing has a number of objectives ranging from

providing information about the product/service, stimulating the demand and
boosting the sale etc. The organization should focus on the long-term benefits in
terms of better branding and customer loyalty while making decisions on ethi cal
issues.

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6. Corporate Social Responsibility: Customers are getting increasingly sensitive

about the production processes and the level of social responsibility of an
organization. Customers tend to prefer the products/services from a company
which is relatively more socially responsible. Hence, it is a benefit for the
organization to be ethically correct for its customers.
Marketing ethics, regardless of the product offered or the market targeted, sets the
guidelines for which good marketing is practiced. To market ethically and effectively one
should be reminded that all marketing decisions and efforts are necessary to meet and
suit the needs of customers, suppliers, and business partners. A company must have
ethical marketing policies to guide their pricing, advertising, research, and competitive
strategies.
Ethical Behaviour and Understanding Ethical Conduct,
Reasons for Ethical Behaviour in Marketing–

The reasons for ethical behaviour in marketing are as follows:
Reasons
1. Well – being of consumers:
Management should be concerned with the well- being of consumers, since they are the
lifeblood of a business. Ethical behaviour in marketing strategies, policies and campaigns
ensure acknowledgment of consumer’s interests.
2. Role of business leaders in marketing:
Marketing activities should not be interpreted wrongly by public as consisting of
misleading packaging labels, false claims in ads, phony list prices, and infringements of
well established trademarks.
To reverse the damaged reputation, business leaders must demonstrate convincingly
that they are aware of their ethical responsibility and will set and enforce high ethical
standards.
3. Reduced Government regulations:

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Unethical marketing behaviour increases the probability of government control on

business. Most of the Governmental limitations on marketing are the result of
management’s failure to maintain its ethical responsibilities in marketing.
To avoid such regulations and retain their freedom of operations by caring for the
consumer’s interest on a voluntary basis.
4. Regain social power:
Marketing executives manage a great deal of social power as they influence the markets
and speak out an economic issue. However, there is responsibility tied to that power. If
marketing executives do not use their power in a socially acceptable manner, that power
will be lost in the long run.
5. Boost public image:
Buyers form an opinion about the entire organization on the basis of their contact with
one person i.e. the person who represents the marketing function (e.g. A sales clerk for
retail store) Ethical marketing behaviour can protect and improve the image of the
enterprise.
Marketing Related Ethical Issues:
Ethical issues in marketing arise from the conflicts and lack of agreement on particular
issues. Parties involved in marketing transactions have a set of expectations about how
the business relationships will take shape and how various transactions need to be
conducted. Each marketing concept has its own ethical issues, which we will discuss in
this chapter.
Emerging Ethical Problems in Market Research
Market research has experienced a resurgence with the widespread use of the Internet
and the popularity of social networking. It is easier than ever before for companies to
connect directly with customers and collect individual information that goes into a
computer database to be matched with other pieces of data collected during unrelated
transactions.
The way a company conducts its market research these days can have serious ethical
repercussions, affecting the lives of consumers in ways that have yet to be fully

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understood. Further, companies can be faced with a public backlash if their market
research practices are perceived as unethical.
Grouping the Market Audience
Unethical practices in marketing can result in grouping the audience into various
segments. Selective marketing may be used to discourage the demand arising from
these so-called undesirable market segments or to disenfranchise them totally.
Examples of unethical market exclusion may include the industry attitudes towards the
gay, ethnic minority, and plus-size groups.
Ethics in Advertising and Promotion
In the early days of existence of corporations, especially during 1940s and 1950s, tobacco
was advertised as a substance that promotes health. Of late, an advertiser who does not
meet the ethical standards is considered an offender against morality by the law.
• Gender biasness is a major point of discussion when ethical issues in advertising

content are considered. Violence is also an important ethical issue in advertising,
especially where children should not be affected by the content.
• Some select types of advertising may strongly offend some groups of people even
when they are of strong interest to others. Feminine hygiene products are
sometimes seen by some as a method of promoting promiscuity that is
undesirable and strongly condemned in various societies.
• A negative advertising policy lets the advertiser highlight various disadvantages

of the competitors’ products rather than showing the inherent advantages of their
own products or services. Such policies are rampant in political advertising.
Delivery Channels
Direct marketing is one of the most controversial methods of advertising channels,

especially when the approaches included are unsolicited.
Some common examples include TV and Telephonic commercials and the direct mail.
Electronic spam and telemarketing also push the limits of ethical standards and legality
in a strong manner.
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Example − Shills and astroturfers are the best examples of ways for delivering a
marketing message under the appearance of independent product reviews and
endorsements, or creating supposedly independent watchdog or review organizations.
Fake reviews can be published on Amazon. Shills are primarily for message-delivery, but
they can also be used to drive up prices in auctions, such as EBay auctions.
Deceptive (Misleading/False) Marketing Policies and Ethics
Deceptive marketing policies are not contained in a specific limit or to one target market,
and it can sometimes go unseen by the public. There are numerous methods of deceptive
marketing. It can be presented to consumers in various forms; one of the methods is one
that is accomplished via the use of humor. Humor offers an escape or relief from various
types of human constraints, and some advertisers may take the advantage of this by
applying deceptive advertising methods for a product that can potentially harm or
alleviate the constraints using humor.
Anti-Competitive Practices
There are various methods that are anti-competitive. For example, bait and switch is a
type of fraud where customers are "baited" through the advertisements for some
products or services that have a low price; however, the customers find in reality that the
advertised good is unavailable and they are "switched" towards a product that is costlier
and was not intended in the advertisements.
Another type of anti-competitive policy is planned obsolescence. It is a method of

designing a particular product having a limited useful life. It will become non-functional
or out of fashion after a certain period and thereby lets the consumer to purchase another
product again.

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A pyramid scheme is also an anti-competitive process. It is a non-sustainable business

model that promises the participants payment or services, mainly for enrolling other
people into the scheme; it does not supply any real investment or sell products or services
to the public.
This business practice demands the initial investor or the "captain" to enroll other people
for a fee to them who again will further enroll more people in order to be paid by the
company.
Pricing Ethics
There are various forms of unethical business practices related to pricing the products
and services.
Bid rigging is a type of fraud in which a commercial contract is promised to one party,
however, for the sake of appearance several other parties also present a bid.
Predatory pricing is the practice of sale of a product or service at a negligible price,

intending to throw competitors out of the market, or to create barriers to entry.
ETHICAL PRODUCT AND DISTRIBUTION PRACTICES
Several product-related issues raise questions about ethics in marketing, most often
concerning the quality of products and services provided. Among the most frequently
voiced complaints are ones about products that are unsafe, that are of poor quality in
construction or content, that do not contain what is promoted, or that go out of style or
become obsolete before they actually need replacing. An organization that markets poor-

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quality or unsafe products is taking the chance that it will develop a reputation for poo r
products or service. In addition, it may be putting itself in jeopardy for product claims or
legal action. Sometimes, however, frequent changes in product features or performance,
such as those that often occur in the computer industry, make previous models of
products obsolete. Such changes can be misinterpreted as planned obsolescence.
Ethical questions may also arise in the distribution process. Because sales performance
is the most common way in which marketing representatives and sales personnel are
evaluated, performance pressures exist that may lead to ethical dilemmas. For example,
pressuring vendors to buy more than they need and pushing items that will result in
higher commissions are temptations. Exerting influence to cause vendors to reduce
display space for competitors' products, promising shipment when knowing delivery is
not possible by the promised date, or paying vendors to carry a firm's product rather than
one of its competitors are also unethical.
Research is another area in which ethical issues may arise. Information gathered from
research can be important to the successful marketing of products or services.
Consumers, however, may view organizations' efforts to gather data from them as
invading their privacy. They are resistant to give out personal information that might
cause them to become a marketing target or to receive product or sales information.
When data about products or consumers are exaggerated to make a selling point, or
research questions are written to obtain a specific result, consumers are misled. Without
self-imposed ethical standards in the research process, management will likely make
decisions based on inaccurate information.
DOES MARKETING OVERFOCUS ON MATERIALISM?
Consumers develop an identity in the marketplace that is shaped both by who they are
and by what they see themselves as becoming. There is evidence that the way consumers
view themselves influences their purchasing behavior. This identity is often reflected in
the brands or products they consume or the way in which they lead their lives.
The proliferation of information about products and services complicates decision

making. Sometimes consumer desires to achieve or maintain a certain lifestyle or image
results in their purchasing more than they need or can afford. Does marketing create

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these wants? Clearly, appeals exist that are designed to cause people to purchase more
than they need or can afford. Unsolicited offers of credit cards with high limits or high
interest rates, advertising appeals touting the psychological benefits of conspicuous
consumption, and promotions that seek to stimulate unrecognized needs are often cited
as examples of these excesses.
SPECIAL ETHICAL ISSUES IN MARKETING TO CHILDREN
Children are an important marketing target for certain products. Because their
knowledge about products, the media, and selling strategies is usually not as well
developed as that of adults, children are likely to be more vulnerable to psychological
appeals and strong images. Thus, ethical questions sometimes arise when they are
exposed to questionable marketing tactics and messages.
For example, studies linking relationships between tobacco and alcohol

marketing with youth consumption resulted in increased public pressure directly leading
to the regulation of marketing for those products.
The proliferation of direct marketing and use of the Internet to market to children also
raises ethical issues. Sometimes a few unscrupulous marketers design sites so that
children are able to bypass adult supervision or control, or sometimes they present
objectionable materials to underage consumers or pressure them to buy items or
provide credit card numbers. When this happens, it is likely that social pressure and
subsequent regulation will result. Likewise, programming for children and youth in the
mass media has been under scrutiny recently.
In the United States, marketing to children is closely controlled. Federal regulations place
limits on the types of marketing that can be directed to children, and marketing activities
are monitored by the Better Business Bureau, the Federal Trade Commission, consumer
and parental groups, and the broadcast networks. These guidelines provide clear
direction to marketers.
ETHICAL ISSUES IN MARKETING TO MINORITIES
The United States is a society of ever-increasing diversity. Markets are broken into
segments in which people share some similar characteristics. Ethical issues arise when

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marketing tactics are designed specifically to exploit or manipulate a minority market

segment. Offensive practices may take the form of negative or stereotypical
representations of minorities, associating the consumption of harmful or questionable
products with a particular minority segment, and demeaning portrayals of a race or
group. Ethical questions may also arise when high-pressure selling is directed at a group,
when higher prices are charged for products sold to minorities, or even when stores
provide poorer service in neighborhoods with a high population of minority customers.
Such practices will likely result in a bad public image and lost sales for the marketer.
Unlike the legal protections in place to protect children from harmful practices, there
have been few efforts to protect minority customers. When targeting minorities, firms
must evaluate whether the targeted population is susceptible to appeals because of their
minority status. The firm must assess marketing efforts to determine whether ethical
behavior would cause them to change their marketing practices.
ETHICAL ISSUES SURROUNDING THE PORTRAYAL OF WOMEN IN MARKETING

EFFORTS
As society changes, so do the images of and roles assumed by people, regardless of race,
sex, or occupation. Women have been portrayed in a variety of ways over the years. When
marketers present those images as overly conventional, formulaic, or oversimplified,
people may view them as stereotypical and offensive.
Examples of demeaning stereotypes include those in which women are presented as less
intelligent, submissive to or obsessed with men, unable to assume leaders hip roles or
make decisions, or skimpily dressed in order to appeal to the sexual interests of males.
Harmful stereotypes include those portraying women as obsessed with their appearance
or conforming to some ideal of size, weight, or beauty. When images are considered
demeaning or harmful, they will work to the detriment of the organization.
Advertisements, in particular, should be evaluated to be sure that the images projected
are not offensive.
CONCLUSION

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Because marketing decisions often require specialized knowledge, ethical issues are
often more complicated than those faced in personal life—and effective decision making
requires consistency. Because each business situation is different, and not all decisions
are simple, many organizations have embraced ethical codes of conduct and rules of
professional ethics to guide managers and employees. However, sometimes self-
regulation proves insufficient to protect the interest of customers, organizations, or
society. At that point, pressures for regulation and enactment of legislation to protect the
interests of all parties in the exchange process will likely occur.
Encouraging Ethical Behaviour
A trusting relationship between management and employees helps to encourage ethical

behavior all around. Consider how the company makes decisions to hire,
train, promote and pay employees. If these important actions aren't done objectively and
fairly, take steps to correct the situation.
*** ** ***

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Marketing Management Introduction

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A 2.

1.1. Nature, Scope and Importance

1|Pa g e 1. Introduction to Marketing VRG – RCP IMRD

2. Marketing is a Legal Process by which Ownership Transfers

3. Marketing is a System of Interacting Business Activities

4. Marketing is a Managerial function

According to managerial or systems approach - "Marketing is the combination of

5. Marketing is a social process

6. Marketing is a philosophy based on consumer orientation and satisfaction

2|Pa g e 1. Introduction to Marketing VRG – RCP IMRD

7. Marketing had dual objectives - profit making and consumer satisfaction

2. Marketing is the delivery of value: When a customer is satisfied from a particular

The scope of marketing is determined by the marketing offering of an organization.

4|Pa g e 1. Introduction to Marketing VRG – RCP IMRD

2. Pricing: Pricing is extremely important since it directly affects an organization’s sales

5|Pa g e 1. Introduction to Marketing VRG – RCP IMRD

5. Financing: It is difficult to perform various marketing activities without the availability

The importance of marketing cannot be over emphasized. It has a special role to

Economic growth is promoted by marketing directly “through proper

Marketing is a powerful source of foreign exchange avoidance through export

healthy competition leading to efficiency both in production and distribution

Mass consumption is encouraged through marketing leading to mass production

Rural economy is strengthened. Advertising in marketing has a very important

Modern economy, therefore, owes much to marketing and, as such, marketing is

The importance of marketing can be summed up as follows:

(i) Export promotion,

P. F. Drucker remarked “Marketing is the foundation of business. Marketing is

This remark of a great authority like Drucker is a sufficient justification of the

1.2. Definition, Evolution, Marketing Orientations (Concepts)

8|Pa g e 1. Introduction to Marketing VRG – RCP IMRD

According to Eldridge (1970) - "Marketing is the combination of activities

Marketing is the process of getting potential clients or customers interested in

Marketing is a business term that experts have defined in dozens of different

Collins Dictionary has the following definition of the term:

9|Pa g e 1. Introduction to Marketing VRG – RCP IMRD

10 | P a g e 1. Introduction to Marketing VRG – RCP

Production Orientation Era

Product Orientation Era

Sales Orientation Era

Marketing Orientation Era

Relationship Marketing Orientation Era

The following sentences summarize the above evolution of marketing.

According to the Evolution of Marketing Philip Kotler, marketing has progressed

What is Market Orientation?

The five marketing orientations and their advantages and disadvantages

Advantages: Economies of scale, efficiency, low cost to customers.

WHICH MARKETING ORIENTATION APPROACH BEST REPRESENTS YOUR

In the conventional approach, the business prioritizes the promotion of existing

16 | P a g e 1. Introduction to Marketing VRG – RCP

Understanding Marketing Orientation

How Does Market Orientation Work?

17 | P a g e 1. Introduction to Marketing VRG – RCP

Advantages of a Market-Oriented Strategy

Disadvantages of a Market-Oriented Strategy

Examples of Market-Oriented Companies

18 | P a g e 1. Introduction to Marketing VRG – RCP

Amazon consistently changes the virtual marketplace and adds features to

The following four steps are involved in the marketing process −

19 | P a g e 1. Introduction to Marketing VRG – RCP

Situational and environmental analysis is done to identify the marketing options, to

Implementation and Control

Marketing Process: 5 Steps of Marketing Process