Principles of Marketing

An Overview

Ahmed S. Ishtiaque
ULAB
Income VS Expenditure
Sl Expenditures Ave. Household Monthly Income
1 Rent = 30,000 1,00,000 BDT
2 Utilities = 10,000
3 Med = 5,000
4 Food = 20,000
5 Transportation = 10,000

6 Education = 25,000
7 Clothing = 5,000
8 Entertainment = 5,000
9 Maintenance = 5,000
10 FMCG = 2,000
11 Trips = 5,000
12 Helping Hands = 6,000
13 Tax = 6,000
14 Total = 1,34,000 - 34,000
Role of Government
Infrastructure Development
1. Physical policies
2. Monitory policies
Job Creation
1. Public sector

2. Private sector

Legislation
create Think Tanks

Monitoring & Evaluation

work jointly with third party

Attract Foreign Investments

Maslow’s Hierarchy Theory
SWOT Analysis
Customer Profiling
What is Marketing ?
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
objectives

American Marketing Association

Marketing as philosophy--I
There is only one valid definition of
business purpose--to create a satisfied
customer. It is the customer who
determines what the business is.
Because its purpose is to create a
customer, any business enterprise has
two--and only these two--basic
functions: marketing and innovation.
Marketing as philosophy--II
Actually, marketing is so basic that it is not
just enough to have a strong sales force and
to entrust marketing to it. Marketing is not
only much broader than selling it is not a
specialized activity at all. It is the whole
business seen from the point of view of its
final result, that is, from its customer’s point
of view.
Peter Drucker, 1954
Marketing as function Exchange
Marketing is a social and managerial process
by which individuals and groups obtain what
they need and want through creating and
exchanging products and value with others
 Creating, promoting, distributing and pricing
products
 Creating satisfying exchange relationships
 Focused on customers
Marketing as exchange
Importance of Customer Relationships
increasing
“Relationship marketing”
 United Mileage Plus
 Hallmark’s Gold Crown Card program;
Hallmark.com
 Mead Johnson’s Enfamil Family Beginnings
“One-to-one marketing”
 Amazon.com
I. Oversubscribing to Conventional
Wisdom... or The Production Concept

Problem with the Production Concept:

• Excessive preoccupation with costs
• Liability issues
• Mass markets are giving way to small
segments and niches
II. Building Better Mousetraps… or
The Product Concept

Problem with the Product Concept

Focus on features, product quality, performance, not
benefits sought by consumers
Consumers are looking for a solution
to the mouse problem
 III. Focusing on Moving Product
or The Selling Concept

When supply exceeds demand,

aggressive selling and advertising is
necessary.
 E.g, Mass production, End of year sales,
clearances

Factory Existing Products Selling & Promoting Profits through sales volume
 The Marketing Concept
Outside-in views beginning with
market analysis to assess customer
needs and wants, defining market
segments and designing marketing
programs to meet those needs.

Market Customer needs Integrated marketing Profits through customer satisfaction

Societal Marketing Concept
Marketing Concept AND serve societal
well being
 Satisfy customers’ needs
 Serve consumer best interests
 Meet organizational goals (e.g., profit)
 Serve society’s best interest
Marketing Plan
4 Ps of Marketing Mix
Factors that Affect an Organization’s
Marketing Program
c es
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Reg

Pro

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Consumer

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Soc
P
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Technological forces

Environmental forces
Consumers Have Different Needs
Market: An aggregate of people who, as individuals or as
organizations, have needs for products in a product
class and who have the ability, willingness, and
authority to purchase such products

Segment: A group of individuals, groups, or organizations

that share one or more similar characteristics which
make them have relatively similar products needs

Segmentation: The process of identifying smaller markets

(groups of people or organizations) that exist within a
larger market
Steps in Segmentation,
Targeting, & Positioning

6. Develop Marketing
Mix for Each Segment
Market
5. Develop Positioning Positioning
for Each Segment
4. Select Target
Segment(s) Market
3. Develop Measures Targeting
of Attractiveness
2. Develop Profiles
of Segments
Market Segmentation
1. Identify Bases
for Segmentation
How to Segment Consumer Markets

Geographic

Demographic
Behavioral /

Common
Product
Usage

Bases for
Segmenting
Markets
Psychographic
 Purchase Decision Process
Problem
Problemrecognition:
recognition:
Perceiving
Perceivingneed
need
Information
Informationsearch:
search:
Seeking
Seekingvalue
value
Alternative
Alternativeevaluation:
evaluation:
Assessing
Assessingvalue
value

Purchase
Purchasedecision:
decision:
Buying
Buyingvalue
value

Post
Postpurchase
purchasebehavior:
behavior:
Value
Valuein
inconsumption
consumptionof
ofuser
user
Slide
7-5

Figure
7.5
The Organizational Buying Process

Recognize a Assign Search for

Need or Responsibility Alternatives
Problem for Making a
Purchase
Decision

Evaluate and Make a Evaluate

Select an Purchase Performance
Alternative of Product and
Supplier

Irwin/McGraw-Hill © The McGraw-Hill Companies, Inc., 1998

Slide
7-9

Figure
7.8
The Buying Center

Initiator
Identifies Need
User
Gatekeeper Uses Product
Controls
Information
Flow Influencer
Affects
Buying
Decision
Decider Buyer
Has Expertise or Has
Power to Make Responsibility to
or Approve Select Vendor
Selection and Negotiate
Terms
Irwin/McGraw-Hill © The McGraw-Hill Companies, Inc., 1998
Marketing Mix (4p’s)
Product

Product Decisions

Branding Quality Features

Benefits offered

We must remember that Marketing is fundamentally about providing the correct

bundle of benefits to the end user, hence the saying ‘Marketing is not about
providing products or services it is essentially about providing changing benefits to
the changing needs and demands of the customer’ (P.Tailor 7/00)

www.learnmarketing.net
Marketing Mix (4p’s)
Slide 3 Pricing

Penetration

Skimming

Pricing Strategies Competition

Product Line
Pricing is the only mix which generates a
turnover for the organisation. The remaining
3p’s are the variable cost for the
organisation. It costs to produce and design a
Bundle
product, it costs to distribute a product and
costs to promote it. Price must support these
elements of the mix. Pricing is difficult and Psychological
must reflect supply and demand relationship.

www.learnmarketing.net
 Marketing Mix (4p’s)
Slide 5 Place

Direct Distribution Indirect Distribution

Manufacturer

Manufacturer

Retailer

Consumer
Consumer

www.learnmarketing.net
Marketing Mix (4p’s)
Slide 4 Promotion

Advertising

Public
Relations

Sales
Promotional Mix Promotion

Personal
Selling

A successful product or service means Digital

nothing unless the benefit of such a service Marketing
can be communicated clearly to the target
market. An organisations promotional mix can
Internet/
consist of:
E-commerce

www.learnmarketing.net
AIETA and the Promotion Mix: The right
tool for the job.
Awareness Interest Evaluation Trial Adoption
Advertising Advertising Advertising Advertising Advertising
-teaser campaigns -information ads -persuasion ads -retailer co-op ads -reminder ads
-pioneering ads -image ads -image ads -POP materials  
-jingles/slogans   -testimonials -sales promotion ads
-outdoor -comparative ads
-internet banners

Publicity Publicity Publicity    

-newsworthy “stunts” -news coverage -consumer welfare
-news announcements -human interest stories reports
-trade announcements
 

Personal Selling Personal Selling Personal Selling Personal Selling Personal Selling
-mentions -benefits (prepared or -consultative selling -closed deal -consultative selling
-samples formula approaches)  
-brochures, etc.

Sales Promotion Sales Promotion   Sales Promotion Sales Promotion

-demonstrations -trade discounts -samples -patronage rewards
-displays -trade allowances -coupons -contests
-tie-ins -rebates
-price packs
-premiums
Promotion Mix Strategies
Strategy
Selected
Strategy that Depends Strategy that
Calls for on: Calls for Using
Spending A Lot the Salesforce
on Advertising Type of
Product- and Trade
and Consumer Promotion to
Promotion to Market &
Push the
Build Up (Pull) Product Product Through
Consumer Life-Cycle the Channels.
Demand. Stage
Setting the Total Promotion
Budget
One of the Hardest Marketing Decisions Facing a
Company is How Much to Spend on Promotion.

Affordable Percentage
Percentage of
of Sales
Sales
Based on What the Based
Basedon
onaaCertain
CertainPercentage
Percentage
Company Can Afford of
ofCurrent
Currentor
orForecasted
ForecastedSales
Sales

Objective-and-Task
Objective-and-Task Competitive-Parity
Competitive-Parity
Based
BasedononDetermining
Determining Based
Basedon
onthe
theCompetitor’s
Competitor’s
Objectives
Objectives&&Tasks,
Tasks,Then
Then Promotion
PromotionBudget
Budget
Estimating
EstimatingCosts
Costs
Sales Management and
Personal Selling
Strategic objectives:
Awareness—mentions, samples, etc.
Interest—benefit information, missionary
Evaluation—consultative selling
Trial—consultative selling (closing)
Adoption—consultative selling