Marketing Management

Unit -1

Course Content
• Definition of marketing and core marketing concept
• Company orientation towards the market place
• Customer value, satisfaction and creating long term loyalty relationship
• Concept of Marketing Management
• Marketing management process
• Guidelines for doing case study in marketing management
• Quiz & Assigning case

Definition of Marketing
 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----AMA (American Marketing Association)

 “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.”
--------- Philip Kotler
 Marketing is the process by which a firm profitably translates customer needs into
revenue-------Mark Burgess

 Marketing is the management process for identifying, anticipating and satisfying

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

What is Marketed?
 Goods
 Services
 Events (Olympics, World Cup, Trade Shows)
 Experiences
 Persons
 Places
 Properties
 Organization
 Ideas
 Core Marketing Concept

 Marketing is a social & managerial process by which individuals & groups obtained
what they need & want through creating, offering & exchanging products of value
with others.

1. Needs, Wants and Demand:

 Need: Basic human requirements

 Wants: Directed at specific objectives
 Demands: Backed by an ability to pay

2. Target Market, Positioning and Segmentation:

3. Offerings and Brands:

 Offering: Value preposition made tangible
 Brand: Offering from a known sources

4. Value and Satisfaction:

 Value: Benefits-Cost
 Customer Value Trial: Quality, service and price
 Satisfaction: Products perceived performance
 5. Marketing Channel:

 Communication Channel: Delivery and receive message

 Distribution Channel: Display, sell and deliver
 Service: Carry out transactions

6. Supply Chain
7. Marketing Environment
8. Competition

Company Orientation Towards the Market Place

Orientation/ Philosophy could be:

• Production concept
• Product concept
• Selling/ Sale concept
• Marketing concept
• Societal concept
• Holistic concept

Explanation

1. Production concept

 One of the oldest concept in business

 It holds that consumers prefer products that are widely available and
inexpensive.
 Managers concentrate on achieving high production efficiency, low cost and
mass distribution.

2. Product concept

 Proposes that consumers favor products offering the most quality, performance
or innovative features.

3. Selling concept

 It holds that consumers and businesses if left alone, won’t buy enough of the
organization's products.

4. Marketing concept

 Customer-centered, sense-and respond philosophy

 It holds that the key to achieving organizational goal is being more effective
than competitors in creating, delivering and communicating superior customer
value to your target markets.

5. Societal concept
 Organization’s task is:

 To determine Needs/ Wants/ Demands/ interests of target market.

 To deliver desired satisfaction more efficiently & effectively than competition.
 To preserve/ enhance consumers/ societies well being while doing so. i.e., build
social/ ethical considerations in to marketing practice.

6. Holistic concept

 Latest development in marketing thought

 Emerged due to the social and technological challenge
 Integration of marketing and societal marketing concept.
 Based on four broad themes:

 Relationship marketing
 Integrated marketing
 Internal Marketing
 Performance marketing

Further Explanation of the Holistic concept

 Relationship Marketing

 Relationship marketing has the aim of building mutually satisfying long-term

relations with key parties-customers, suppliers, distributors-in order to earn and
retain business.
 Focus is not on immediate sales; rather it is directed at building a large group of
satisfied and loyal customers.
 Customer retention and winning back lost customers are key strategy.

 Integrated Marketing

 There must be full integration of mkt programs to create, communicate and

deliver superior value to customers.
 The integration should be at the level of MKT Mix (4 Ps )

 Internal Marketing

 It is based on everybody within an organization is marketer.

 Mainly hiring, training and motivating staff to serve the customer well.

 Performance Marketing

 Emphasizes that mkt activities should perform at two levels:

I. Revenue and profit

II. Social Responsibility

 Mkt has responsibility to generate adequate revenue and profit for the firm.
 Mkt should take the ethical, legal, environmental and social concerns of people
and society.
 Customer Value
• Emphasizes that mkt activities should perform at two levels:

 Revenue and profit

 Social Responsibility

• Mkt has responsibility to generate adequate revenue and profit for the firm.
• Mkt should take the ethical, legal, environmental and social concerns of people and
society.

There are two aspects to customer value

•  Desired value and perceived value:

 Desired value refers to what customers desire in a product or service.

 Perceived value is the benefit that a customer believes he or she received from
a product after it was purchased

Customer Satisfaction
• Satisfaction refers to the buyer’s state of being adequately rewarded by the purchase
decision.
•  It is a measure of how products and services supplied by a company meet or
surpass customer expectation.
• Customer satisfaction is defined as "the number of customers, or percentage of total
customers, whose reported experience with a firm, its products, or its services
(ratings) exceeds specified satisfaction goals.

Reasons why customer satisfaction is so important:

• It’s a leading indicator of consumer repurchase intentions and loyalty

• It’s a point of differentiation
• It increases customer lifetime value
• It reduces negative word of mouth
• It’s cheaper to retain customers than acquire new ones

Creating long term loyalty relationships

• Customer perceived value is the difference between the prospective customer’s

evaluation of all the benefits and all the costs of an offering and the perceived
alternatives.
• Determinants of Customer Perceived Value
  Total Customer Benefits – Customer cost = Customer perceived value

Total Customer Benefits = Product benefit, Service benefit, personnel benefits,

Image benefits.

Customer cost = Monetary cost, time cost, energy cost, psychological cost.

What is Loyalty?

• Loyalty is a deeply held commitment to re-buy or re-patronize (support) a preferred

product or service in the future despite situational influences and marketing efforts
having the potential to cause switching behavior.

Top Brands in Customer Loyalty

• Apple iPhone
• Samsung
• Wal-Mart
• Google
• Amazon
• AT&T Wirel

What is Customer Relationship Management?

CRM is the process of carefully managing detailed information about individual customers
and all customer touch points to maximize customer loyalty.

Using the Database

• To identify prospects
• To target offers
• To deepen loyalty
• To reactivate customers
• To avoid mistakes

Concept of Marketing Management

• Marketing management is 'the art and science of choosing target markets and getting,
keeping, and growing customers through creating, delivering, and communicating
superior customer value‘.

• Marketing management is the process of developing strategies and planning for

product or services, advertising, promotions, sales to reach desired customer segment.
• It relies heavily on designing the organisations offering in terms of the target markets
needs and desires and using effective pricing, communication and distribution to
inform, motivate and service the market.
• It involves planning, implementation and control of marketing programmes or
campaigns.