The Scope of Marketing

Marketing people are involved in marketing 10 types of entities: goods, services, experiences, events, persons, places, properties, organizations, information, and ideas. Goods. Physical goods constitute the bulk of most countries production and marketing effort. Services. As economies advance, a growing proportion of their activities are focused on the production of services. Experiences. By orchestrating several services and goods, one can create, stage, and market experiences. Events. Marketers promote time-based events, such as the Olympics, trade shows, sports events, and artistic performances. Persons. Celebrity marketing has become a major business. Artists, musicians, CEOs, physicians, high-profile lawyers and financiers, and other professionals draw help from celebrity marketers. Places. Cities, states, regions, and nations compete to attract tourists, factories, company headquarters, and new residents. Place marketers include economic development specialists, real estate agents, commercial banks, local business associations, and advertising and public relations agencies. Properties. Properties are intangible rights of ownership of either real property (real estate) or financial property (stocks and bonds). Properties are bought and sold, and this occasions a marketing effort by real estate agents (for real estate) and investment companies and banks (for securities). Organizations. Organizations actively work to build a strong, favorable image in the mind of their publics. Philips, the Dutch electronics company, advertises with the tag line, Lets Make Things Better.

Information. The production, packaging, and distribution of information is one of societys major industries. Among the marketers of information are schools and universities; publishers of encyclopedias, nonfiction books, and specialized magazines; makers of CDs; and Internet Web sites. Ideas. Every market offering has a basic idea at its core. In essence, products and services are platforms for delivering some idea or benefit to satisfy a core need. Marketing Concepts Marketing- is the process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods, and services to create exchanges that satisfy individual and organizational goals. Needs, Wants, and Demands Needs- describe basic human requirements such as food, air, water, clothing, and shelter. Wants- needs become wants when they are directed to specific objects that might satisfy the need. Demands- are wants for specific products backed by an ability to pay. Needs pre-exist marketers; Marketers influence wants Product or Offering A product is any offering that can satisfy a need or want. A brand is an offering from a known source. Ex- Maruti Associations (brand)- Ex- Maruti Cars- Fuel efficient, low maintenance, low cost

Associations make up the brand image. All companies strive to build brand strength- strong, favorable, brand image. Value and Satisfaction The product or offering will be successful if it delivers value and satisfaction to the target buyer. The buyer chooses between different offerings on the basis of which is perceived to deliver the most value. Value is the ratio between what the customer gets and what he gives.

Ex- Automobile Functional benefit- travel Emotional benefit- comfort, pride Monetary costs- price Time costs- time spent on the purchase process Energy costs- running around Psychic costs- mental strain Exchange and Transactions Exchange, involves obtaining a desired product from someone by offering something in return. For exchange potential to exist, five conditions must be satisfied: 1. There are at least two parties. 2. Each party has something that might be of value to the other party. 3. Each party is capable of communication and delivery.

4. Each party is free to accept or reject the exchange offer. 5. Each party believes it is appropriate or desirable to deal with the other party. Exchange is a value-creating process rather than an event. Two parties are engaged in exchange if they are negotiatingtrying to arrive at mutually agreeable terms. When an agreement is reached, we say that a transaction takes place. A transaction is a trade of values between two or more parties. A transaction involves several dimensions: 1. At least two things of value. 2. Agreed upon conditions. 3. Time of agreement. 4. Place of agreement. Marketing Channels It is the link that connects marketer to the target buyers. There are three kinds of marketing channels1. Communication

channels- to deliver & receive messages from the target

buyers. Ex- Newspapers, TV, radio, etc.

2. Distribution

channels- to display sell or deliver the physical products or

services to the buyer or user. Ex- Distributors, wholesalers, retailers

3. Selling/

service channels- to carry out the transactions with the potential buyers.

Ex- retailers, branch office of a bank SIMPLE MARKETING SYSTEM

EVOLUTION OF MARKETING CONCEPT The Production Concept The production concept holds that consumers prefer products that are widely available and inexpensive. Managers of production-oriented businesses concentrate on achieving high production efficiency, low costs, and mass distribution. This orientation makes sense in developing countries, where consumers are more interested in obtaining the product than in its features. It is also used when a company wants to expand the market. Ex- China- largest PC manufacturer in the world The Product Concept The product concept holds that consumers favor those products that offer the most quality, performance, or innovative features. Managers in these organizations focus on making superior products and improving them over time, assuming that buyers can appraise quality and performance.

Product-oriented companies often design their products with little or no customer input, trusting that their engineers can design exceptional products. Ex- Uncle Chips packed in carton boxes The Selling Concept The selling concept, another common business orientation, holds that consumers and businesses, if left alone, will ordinarily not buy enough of the organizations products. The organization must, therefore, undertake an aggressive selling and promotion effort. This concept assumes that consumers must be coaxed into buying, so the company has a battery of selling and promotion tools to stimulate buying. Ex- Unsought goods goods that buyers normally do not think of buying, such asinsurance In this concept, the aim is to sell what they make rather than make what the market wants. The Marketing Concept The marketing concept holds that the key to achieving organizational goals consists of the company being more effective than its competitors in creating, delivering, and communicating customer value to its chosen target markets. The marketing concept rests on four pillars: 1. Target market, 2. Customer needs,
3.

Integrated marketing (When all of the companys departments work together to serve the customers interests, the result is integrated marketing.), and

4. Profitability.

The selling concept takes an inside-out perspective. It starts with the factory, focuses on existing products, and calls for heavy selling and promoting to produce profitable sales. The marketing concept takes an outside-in perspective. It starts with a well-defined market, focuses on customer needs, coordinates activities that affect customers, and produces profits by satisfying customers.

The Holistic Marketing Concept Concept is based on the development, design, & implementation of marketing programs, process, & activities that recognizes their breadth & interdependencies. Four components of holistic marketingRelationship marketing- key goal of marketing is to develop deep, enduring relationships with all people or organizations that could directly or indirectly affect the success of the firms marketing activities. Relationship marketing has the aim of building mutually satisfying long term relationships with key parties- customers, suppliers, distributors, & other marketing partners. Builds strong economic, technical, & social ties among the parties. Integrated marketing- Marketing mix decisions must be made for influencing the trade channels as well as final customers. Integration of one marketing activity is done with all other activities in mind. Businesses must integrate their systems for demand management, resource management, & network management Internal marketing- is the task of hiring & motivating all employees who want to serve customers well.

Integrating all companys departments to work together to serve the customers interests. Socially responsible marketing- holds that the organizations tasks is to determine the needs, wants, & interests of target markets & to deliver the desired satisfactions more effectively & efficiently than competitors in a way that preserves or enhances the consumers & the societys well being. CUSTOMER IS ANYONE WHO IS IN THE MARKET LOOKING AT A PRODUCT / SERVICE FOR ATTENTION, ACQUISITION, USE OR CONSUMPTION KINDS OF CUSTOMERS DEFENSIVE CUSTOMERS RETAINING OLD CUSTOMERS. OFFENSIVE CUSTOMERS GETTING NEW CUSTOMERS DEMARKETING INCREASE IN MARKETING EFFORTS NOT TO INCREASE CONSUMPTION BUT REDUCE CONSUMPTION. REDUCING SMOKING, DRINKING, DRUGS ETC

CONSERVATION OF WATER, PETROL, ELECTRICITY ETC

RELEVANCE OF MARKETING IN INDIA EXCESSIVE COMPETITION. PSYCHOGRAPHICS. INCREASED AWARENESS. 1991 MILESTONE LPG POLICY.

 CHOICE. DINKS MARKETING FUNCTIONS ANALYSIS FINDING OPPORTUNITIES AVOIDING THREATS UNDERSTANDING STRENGTHS ANALYZING WEAKNESSES PLANNING MARKETING PLANS INCLUDE: EXECUTIVE SUMMARY ANALYSIS OF CURRENT SITUATION OBJECTIVES TARGETS AND POSITIONING MARKETING MIX BUDGET CONTROLS

IMPLEMENTATION PLANS ARE TURNED INTO ACTION WITH DAY-TO-DAY ACTIVITIES GOOD IMPLEMENTATION IS A CHALLENGE

CONTROL

EVALUATION OF THE RESULTS OF MARKETING STRATEGIES CHECKS FOR DIFFERENCES BETWEEN GOALS AND PERFORMANCE

STRATEGIC PLANNING- IS THE MANAGERIAL PROCESS OF DEVELOPING AND MAINTAINING A STRATEGIC FIT BETWEEN THE ORGANIZATION'S OBJECTIVES AND RESOURCES AND ITS CHANGING MARKET OPPORTUNITIES. STRATEGIC MARKETING- MARKETING STRATEGY IS A SERIES OF INTEGRATED ACTIONS LEADING TO A SUSTAINABLE COMPETITIVE ADVANTAGE WHAT IS COMPETITIVE SUSTAINABLE ADVANTAGE? COMPETITIVE ADVANTAGE IS A COMPANYS ABILITY TO PERFORM IN ONE OR MORE WAYS THAT COMPETITORS CANNOT OR WILL NOT MATCH CHARACTERISTICS OF COMPETITIVE ADVANTAGE SUBSTANTIALITY IS IT SUBSTANTIAL ENOUGH TO MAKE A DIFFERENCE? SUSTAINABILITY CAN IT BE NEUTRALIZED BY COMPETITORS QUICKLY?

ABILITY TO BE LEVERAGED INTO VISIBLE BUSINESS ATTRIBUTES THAT WILL INFLUENCE CUSTOMERS

SEEKING COMPETITIVE ADVANTAGES Positions of advantage Superior customer value Lower relative total cost

 Performance advantages Customer satisfaction, Loyalty, Market Share, Profit Sources of advantages Superior skills & knowledge, Superior resources, Superior business process STEPS IN STRATEGIC PLANNING
1.

DEFINE THE COMPANYS VISION STATEMENT- VISION STATEMENT IS A STATEMENT OF THE ORGANISATION FOR THE LONG RUN DEFINE THE COMPANYS MISSION STATEMENT- MISION STATEMENT IS A STATEMENT OF THE ORGANISATION PURPOSE, WHAT IT WANTS TO ACCOMPLISH IN THE MICRO ENVIRONMENT SETTING CORPORATE OBJECTIVES & GOALSAN OBJECTIVE IS A LONG-RANGE PURPOSE NOT QUANTIFIED AND NOT LIMITED TO A TIME PERIOD E.G. INCREASING THE RETURN ON SHAREHOLDERS EQUITY A GOAL IS A MEASURABLE OBJECTIVE OF THE BUSINESS ATTAINABLE AT SOME SPECIFIC FUTURE DATE THROUGH PLANNED ACTIONS E.G. 10% GROWTH IN THE NEXT TWO YEARS

2.

3.

4.

DESIGNING THE COMPANY PORTFOLIOBUSINESS PORTFOLIO:

THE COLLECTION OF PRODUCTS AND SERVICES WHICH ARE PART OF THE ORGANISATION. PORTFOLIO ANALYSIS: A TOOL THROUGH WHICH THE MANAGEMENT IDENTIFIES AND EVALUATES THE VARIOUS BUSINESSES WHICH MAKE UP THE COMPANY 5. IMPLEMENTATION OF THE PLAN 6. CONSTANT REVIEW N FOLLOW UP

STRATEGIC BUSINESS UNIT? (SBU) Large companies normally manage quite different businesses, each requiring its own strategy; General Electric, as one example, has established 49 strategic business units (SBUs). An SBU has three characteristics: (1) It is a single business or collection of related businesses that can be planned separately from the rest of the company; (2) it has its own set of competitors; and (3) it has a manager responsible for strategic planning and profit performance who controls most of the factors affecting profit. CHARACTERISTICS OF A VIABLE SBU UNIQUE BUSINESS MISSION DEFINABLE SET OF COMPETITORS INTEGRATIVE PLANNING DONE INDEPENDENTLY RESPONSIBLE FOR RESOURCE MANAGEMENT IN ALL AREAS LARGE ENOUGH BUT NOT SO LARGE AS TO BECOME BUREAUCRATIC