What is marketing?

Strategic perspective: Satisfying customer needs profitably and better than competition Tactical perspective: Ensuring right product in right place at right time, at right price

Need
Generic desire (+) or problem that consumer seeks to solve

Want
Concrete form in which need is being shaped

Deman d
Want backed by buying power

What is marketing?

The essence of marketing can be summarized in three great principles. The first identifies the purpose and task of marketing, the second the competitive reality of marketing and third the principal means for achieving the first two.

What is marketing?
(1)

The Customer Value and Value Equation : V=B/P Where; V=Value B= Perceived Benefits P= Price

(Value is increased by increasing the numerator and/or reducing the denominator)

What is marketing?
(2).Competitive or Differential Advantage : The total offer must be more attractive than that of the competition in order to create a competitive advantage. (3).Focus or the Concentration of Attention : The task of creating Customer Value at a Competitive advantage.

Marketing philosophies
Societal

Production
Selling Product

Marketing

Marketing philosophies

Production Concept
Company Produce more & more Consumers Sell Practically sells itself

Produce

Consumers will favour those products that are widely available and low in cost.
Therefore increase production and cut down costs. And build profit through volume.

Marketing philosophies

Product concept
Practically sells itself,if it gives most quality for money Consumers

Produce Quality Products Sell

Buyers admire well-made products and can appraise product quality and performance
Consumers will favour those products that offer the most quality, performance, or innovative features.

Therefore, improve quality, performance and features to realize increased sales and profits.

Marketing philosophies

Selling concept
Produce Sell it Aggressive selling & promotion efforts

Consumers

Consumers have normal tendency to resist. Making sales becomes primary function and consumer satisfaction secondary Consumers , if left alone , will not buy enough of companys products.

Therefore, promote sales aggressively & build profit through quick turnover.

Marketing philosophies

Marketing Concept
Learn what they want(MR) Produce it Market it

Consumers
Sell what they want(Satisfy needs of customers)

LOVE THE CUSTOMER , NOT THE PRODUCT

The key to achieving organizational goals consist in determining the needs and wants of target markets and delivering the desired satisfactions more effectively and efficiently than competitors. And build profit through customer satisfaction and loyalty.

Marketing philosophies

Societal Marketing Concept It is Marketing Concept (+) Societys well being.

Balancing of following three considerations while setting marketing policies :

Customers want satisfaction Societys well being Companys profits

Marketing philosophies

Societal Marketing Concept It is Marketing Concept (+) Societys well being.

Balancing of following three considerations while setting marketing policies :

Customers want satisfaction Societys well being Companys profits

Marketing philosophies
Starting Point Selling Concept Factory Products Selling & Promoting Profit through sales volume Focus Means Ends

Marketing Concept

Target Market

Customer Needs

Coordinated Marketing

Profit through customer satisfaction

Situational Analysis
Situational Analysis Marketing Objectives Marketing Strategy Marketing Tactics Marketing Implement -ation Audit & Control

External Analysis:
Macro/micro environment, Porters 5 forces,

Internal Analysis:
Analyze all functions, 5M framework, Portfolio analysis

Internal + External Analysis:

SWOT Analysis

Situational Analysis
Situational Analysis Marketing Objectives Marketing Strategy Marketing Tactics Marketing Implement -ation Audit & Control

External environment analysis

(PEST = Political-legal, Economic-demographic, Sociocultural, and Technological) Micro environment analysis (Value Chain Analysis = Customers, Competitors, Suppliers & Distributors) Industry or competitive analysis (Porters 5 Forces Analysis)

Situational Analysis
Situational Analysis Marketing Objectives Marketing Strategy Marketing Tactics Marketing Implement -ation Audit & Control

Technological Cultural Political Demographic Colonial Coffee Board Roots of India Economic Region Production Coffee at Home: as stimulant Subsidies Innovative coffee makers Natural/Ecological Country have GDPsimplified Export Cultural Growth Subsidies icon in south consumption India Age Inflation threat from Impending tea Technology Advent lobbyof coffee Transfer shop for Income Foreign Exchange Rate plantations culture

Situational Analysis
Situational Analysis Marketing Objectives Marketing Strategy Marketing Tactics Marketing Implement -ation Audit & Control The bargaining power is with the buyers owing to the stiff competition Very limited threat of new entrants as the two players are well established

Determinants of buyer power

Determinants of supplier power

In general the bargaining power of suppliers is limited as most of the supply comes from developing nations The threat of substitutes is more as people are observed to switch to other hot drinks

Threat of New Entrants

Rivalry among existing firms

Porters 5 Forces

Threat of substitute products

Marketing Objectives
Situational Analysis Marketing Objectives Marketing Strategy Marketing Tactics Marketing Implement -ation Audit & Control

Specific

Measurable

Achievable

Realistic

Timebound

Situational Analysis

Marketing Objectives

Marketing Strategy

Marketing Tactics

Marketing Implement -ation

Audit & Control

Segmentation
Targeting Positioning

Situational Analysis

Marketing Objectives

Marketing Strategy

Marketing Tactics

Marketing Implement -ation

Audit & Control

Segmentation Targeting Positioning

Market segmentation is the process of dividing the total market for a good or service into several smaller, internally homogeneous groups.

Segmentation is necessary because customers in a market have:

Differences in buying habits. Differences in the way the good or service is used.

Different motives for buying.

Situational Analysis

Marketing Objectives

Marketing Strategy

Marketing Tactics

Marketing Implement -ation

Audit & Control

Segmentation Targeting Positioning

Segmentation Parameter
Geographic Demographic Psychographic

Sample Segments
Continents: N America, Asia, Europe, Africa Within India: North, west, south etc. Age, gender, income, Cohort, household type VALs (Innovators, thinkers, achievers, experiencers, believers, strivers, makers and survivors) Convenience, economy, prestige Urban, established, sophisticated town houses, affluent retirees Not loyal, somewhat loyal, completely loyal Heavy, Moderate & Lower (Paretos Law 80/20 principle) Festivals, Everyday shopping list, self indulgence

Benefits Geo-demographic Loyalty Usage Rate Occasions

Situational Analysis

Marketing Objectives

Marketing Strategy

Marketing Tactics

Marketing Implement -ation

Audit & Control

Segmentation
Targeting Positioning

Targeting is the process of evaluating different segments and focussing on those which are most likely to yield the maximum benefits

Differentiable Accessible Measurable

Substantial

Segment Attractiven ess

Actionable

Situational Analysis

Marketing Objectives

Marketing Strategy

Marketing Tactics

Marketing Implement -ation

Audit & Control

Segmentation
Targeting Positioning

Positioning refers to the consumers perception of the product and its benefits in relation to its competitors. The aim is to occupy a clear, distinct and desirable space in the mind of the customer

Situational Analysis

Marketing Objectives

Marketing Strategy

Marketing Tactics

Marketing Implement -ation

Audit & Control

Segmentation
Targeting

Identify possible differences and competitive advantages - explore services, channels, people, Identify image etc.

Chose

How many differences to promote ? Which differences to promote ? IDSCAP

Positioning
Select

Select the right overall positioning strategy.

Develop a statement To target segment, our Develop brand is concept that creates point of difference

Situational Analysis

Marketing Objectives

Marketing Strategy

Marketing Tactics

Marketing Implement -ation

Audit & Control

Segmentation
Targeting Positioning
MORE

MORE

THE SAME

LESS

LESS

Benefits THE SAME

Price

Situational Analysis

Marketing Objectives

Marketing Strategy

Marketing Tactics

Marketing Implement -ation

Audit & Control

PRODUCT

Top Down Competition Based Physical Attributes Brand Quality Bottom Up Cost Based Rebates

Indirect Channel Wholesellers

People
Personality Based Trust

Processes
Process Based Trust

Physical Evidence
Ambience

Sponsorships

Conventions

Advertising

Sales Promotions

PLACE

Direct Channels Salesforce, Company Showrooms, Distributors

PROMOTION

PR

PRICE

Situational Analysis

Marketing Objectives

Marketing Strategy

Marketing Tactics

Marketing Implement -ation

Audit & Control

Market Implementation
Implementing is the process that turns marketing plans into marketing actions to accomplish strategic marketing objectives. An important factor influencing Implementation is the departmental organisation.
Functional organization Geographic organization Product management organization Market or customer management

Situational Analysis

Marketing Objectives

Marketing Strategy

Marketing Tactics

Marketing Implement -ation

Audit & Control

Measure and Control

Audit and Control involves constant monitoring during implementation to ensure that the intended outcomes are achieved.
Operating Control Monitor sales and profits against projections and annual plans Take corrective action as and when necessary Strategic Control Ensure current strategies are matched to opportunities Periodically assess overall approach to the marketplace

Product Life Cycle (PLC)

Product Development:

New ideas/possible inventions Market analysis is it wanted? Can it be produced at a profit? Who is it likely to be aimed at? Product Development and refinement Test Marketing possibly local/regional Analysis of test marketing results and amendment of product/production process Preparations for launch publicity, marketing campaign

Product Life Cycle (PLC)

Introduction/Launch:

Advertising and promotion campaigns Target campaign at specific audience? Monitor initial sales Maximise publicity High cost/low sales Length of time type of product

Product Life Cycle (PLC)

Growth:

Increased consumer awareness

Sales rise
Revenues increase Costs - fixed costs/variable costs, profits may be made Monitor market competitors reaction?

Product Life Cycle (PLC)

Maturity:

Sales reach peak Cost of supporting the product declines Ratio of revenue to cost high Sales growth likely to be low Market share may be high Competition likely to be greater Price elasticity of demand? Monitor market changes/amendments/new strategies?

Product Life Cycle (PLC)

Decline and Withdrawal:

Product outlives/outgrows its usefulness/value Fashions change Technology changes Sales decline Cost of supporting starts to rise too far Decision to withdraw may be dependent on availability of new products and whether fashions/trends will come around again?

Q&A

Assignment
Analyze a minimum of 5 advertisement campaigns of a Brand of your choice and deliver on the following:
1. Targeting and Positioning of each separate Campaign 2. Competition Benchmarking LOCATION 3. Comment on the Coherence of the campaigns deployed Expected Length: Maximum of 3 Pages
MESSAGE

ARCHETYPE
Psychographic

Demographic

Benefit

Advertisement Analysis Framework

Contact
Deepak Srinivasan +91 8235373997 b12018@astra.xlri.ac.in

Avishek Ray +91 9546187923 b12015@astra.xlri.ac.in