Defining Marketing for the 21st

Century
Why is marketing important?
• Proliferation of products
• Most offerings have similar quality and features
• Shift in power
• Savvy customers
• Only way to dominate the market
• Economic stability and survival depend on carving out
such identities
What is Marketing?
 Simplest definition: Marketing is managing profitable
customer relationships.
 Two-fold goal:
 Attract new customers --- promising superior value
 Grow current customer base --- delivering satisfaction
 Aim of marketing: to make selling unnecessary (Peter
Drucker)*

*Kotler, Philip and Keller, Kevin Lane: Marketing Management. 14th ed.
What is Marketing?

An organizational function and a set of processes by

which companies create, communicate, deliver value
to customers and build strong customer relationships
in order to capture value from customers in return.
Customers’ Needs, Wants, Demands

Needs

• States of felt deprivation – Physical, Social,

Individual

Wants

• Human needs shaped by Culture and

Individual Personality

Demands

• Wants backed by buying power

Marketing Mix (contd.)
Developing Marketing Strategies
& Plans
LECTURE 2
Strategic Planning
 Strategic Planning: the process of developing and
maintaining a strategic fit between the organization’s
goals and capabilities and its changing marketing
opportunities

 Focus of strategic planning:

 To find the game plan for long-run survival and growth
that makes the most sense in its environment, objectives
and resources
 GE/McKinsey Matrix
 Industry Attractiveness
 Market growth rate
 Market size
 Demand variability
 Industry profitability
 Industry rivalry
 Global opportunities
 PEST
 Business Unit Strength
 Market share
 Growth in market share
 Brand equity
 Distribution channel
access
 Production capacity
 Relative profit margins
Managing Marketing Effort
Analyzing the Marketing
Environment

LECTURE 3
OBJECTIVES
 Discuss the forces affecting marketing environment
 Microenvironment
 Macroenvironment
 Microenvironment  Macroenvironment
 Company  Demographics
 Suppliers  Economic
 Marketing intermediaries  Nature
 Competitors  Technology
 Publics  Politics
 Customers  Culture
Marketing Environment
The actors and forces outside marketing that affect
marketing management’s ability to build and maintain
successful relationships with target customers

 Marketing environment consists of a microenvironment

and macroenvironment
What should marketers do?
 Marketers must be environmental trend trackers
 Marketers should be opportunity seekers

 Every firm must organize and distribute a continuous flow

of information to its marketing managers
 Marketing information system
What should marketers do?
 Marketers should have two special aptitudes
 Disciplined methods
 Internal Records
 Marketing research
 Marketing intelligence
 They spend more time in customer and competitor
environments
 Internal Records
 Order-to-Payment Cycles
 Sales Information Systems
 Databases
 Marketing Intelligence: set of procedures and sources
that managers use to obtain information about
development in the marketing environment
 Train and motivate sales force to spot and report new
developments
 Motivate entities in value delivery network to pass important
information
 Mystery shoppers
 Take advantage of published data
 Collect information from the internet through independent forums,
feedback sites, customer complaint sites or public blogs
 Demog Politica Techno Social-
Natural
raphics l-legal logy cultural
Explosive More Lead Stimulate new Change
population depletion of consumer to technological attitudes
growth natural call for more solutions and
resources laws behavior
Consumer Buyer Behavior

LECTURE 4
Consumer Buyer Behavior

The buying behavior of final consumers – individuals

and households

 What consumers buy?

 Where they buy from?
 How much do they buy?

 Why they buy what they buy?

Model of Consumer Behavior
Characteristics Affecting Consumer
Behavior
Buyer Decision Process
 Consumers generally
pass through all five
stages
 May pass quickly or
slowly
 In routine purchases,
consumers often skips
or reverse some
stages
Adoption Process
 Mental process through which an individual passes
from first hearing about an innovation to final
adoption

 Awareness
 Interest
 Evaluation
 Trial
 Adoption
Individual Differences in Innovativeness
Influence of Product Characteristics on Rate
of Adoption
 Relative Advantage
 Complexity
 Divisibility: degree to which innovation may be tried
on a limited basis
 Communicability

 Ongoing costs
 Risk and uncertainty
 Social approval
Business Markets and Business
Buyer Behavior

LECTURE 5
Business Buyer Behavior
Buying behavior of organizations that buy goods and
services for use in the production of other products
and services that are sold, rented or supplied to
others

 Also includes the behavior of retailers and

wholesalers
Model of Business Buyer Behavior
Business Markets
 Huge
 Large number of business transactions
 Firms in business markets may sell their products
directly to consumers
 Involve people like consumer markets
Business vs Consumer Markets
 Market structure and demand
 Fewer, larger buyers
 Derived demand – demand from consumers
 Inelastic demand – price
 Specially in the short run

 Nature of buying unit

 Professional purchasing by trained agents
 Multiple buying influence – more influential people
Business vs Consumer Markets (contd.)
 Types of decisions and the decision process
 More complex
 Buying process longer and formalized
 Close supplier-customer relationship
 Multiple sales calls
 Supplier development
Participants in Business Buying
Process
The Buying Center

Consists of all those individuals and groups who

participate in the purchasing decision-making
process

 Not fixed
 Not formally identified unit

 Marketers must learn who participates in the

decision
 Usually includes some participants involved formally
Members of Buying Center
 Initiators
 Users
 Influencers
 Deciders
 Approvers
 Buyers
 Gatekeepers
 Major Influences on Business
Behavior
Environmental, Organizational, Interpersonal
and Individual
Influences on Business Buyer