Defining Marketing for the 21 st

Century
by

Prepared by:
Dr. Shamsad Ahmed
Doctor of Philosophy in Marketing
M.Pharm (DU), MBA (IBA)
Associate Professor
Department of Business
Administration
University of Asia Pacific
Mobile: 01757257520
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 Marketing Defined

Kotler’s social definition:

“Marketing is a societal process
by which individuals and groups
obtain what they need and want
through creating, offering, and
freely exchanging products and
services of value with others.”

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 Marketing Defined

The AMA managerial definition:

“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.”
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 Market
•Traditionally, a
market was a
physical place
where buyers and
sellers gathered to Boshundhara City Mall
exchange goods.

Shamsad,407
Market
•Economists describe a
market as a collection of
buyers and sellers and who
transact over a particular
product or product class
(e.g. fruits market).

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 Market

•Marketers view the sellers as constituting the industry,

and the buyers as constituting the market. 6
 Market
Businesspeople often use the term markets to cover various
grouping of customers. We talk about:
•Need markets: e.g. the
diet-seeking market;
•Product markets: e.g. the shoe
market;
•Demographic markets: the youth
market;
•Geographic markets: the Indian
market;
Or they extend the concept to cover other markets, such as voter 7
markets, labor markets etc.
 Market
Businesspeople often use the term markets to cover various
grouping of customers. We talk about:
•Need markets: e.g. the
diet-seeking market;
•Product markets: e.g. the shoe
market;
•Demographic markets: the youth
market;
•Geographic markets: the Indian
market;
Or they extend the concept to cover other markets, such as voter 8
markets, labor markets etc.
 Market
Businesspeople often use the term markets to cover various
grouping of customers. We talk about:
•Need markets: e.g. the
diet-seeking market;
•Product markets: e.g. the shoe
market;
•Demographic markets: the
children market;
•Geographic markets: the Indian
market;
Or they extend the concept to cover other markets, such as voter 9
markets, labor markets etc.
 Market
Businesspeople often use the term markets to cover various
grouping of customers. We talk about:
•Need markets: e.g. the
diet-seeking market;
•Product markets: e.g. the shoe
market;
•Demographic markets: the youth
market;
•Geographic markets: the Indian
market;
Or they extend the concept to cover other markets, such as voter10
markets, labor markets etc.
 Market
Businesspeople often use the term markets to cover various
grouping of customers. We talk about:
•Need markets: e.g. the
diet-seeking market;
•Product markets: e.g. the shoe
market;
•Demographic markets: the youth
market;
•Geographic markets: the Indian
market;
Or they extend the concept to cover other markets, such as voter11
markets, labor markets etc.
 Market
Businesspeople often use the term markets to cover various
grouping of customers. We talk about:
•Need markets: e.g. the
diet-seeking market;
•Product markets: e.g. the shoe
market;
•Demographic markets: the
Children market;
•Geographic markets: the Indian
market;
Or they extend the concept to cover other markets, such as voter12
markets, labor markets etc.
 Market
Today we can distinguish between a marketplace and
marketspace.

•The marketplace is
physical as when one
goes shopping in a
store;
•The marketspace is
digital, as when one
goes shopping on the
Internet.
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 Market
Today we can distinguish between a marketplace and
marketspace.

•The marketplace is
physical as when one
goes shopping in a
store;
•The marketspace is
digital, as when one
goes shopping on the
Internet.
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 Market
•Metamarkets refer to
complementary goods and
services that are related in
the minds of consumers.
One example is Edmund’s
(www.edmunds.com) a
Website where a car buyer can
find the stated features and
prices of different automobiles
and easily click to other sites
to search for the lowest-price
dealer, for financing, for car
accessories, and used cars at
bargain prices.
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 Who Markets? For
Whom?

•Marketers seek responses from prospects.

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 Market
Actual
Buyers
Market: Buyers who
share a particular
need or want that can
be satisfied by a
company’s products
or services. Potential
Buyers

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 Core Marketing Concepts
• Target markets and • Exchange and
market segmentation transactions
• Marketplace, market- • Relationship and
space, metamarkets networks
• Marketers & prospects • Marketing channels
• Needs, wants, demands • Supply chain
• Product offering and • Competition
brand • Marketing environment
• Value and satisfaction • Marketing program

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The Decisions
Marketers Make
• Consumer Markets
• Business Markets
• Global Markets
• Nonprofit and
Governmental Markets

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Figure : A Simple Marketing System

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 Core Marketing Concepts

• Target markets & segmentation

– Differences in needs, behavior,
demographics or psychographics are
used to identify segments.
– The segment served by the firm is
called the target market.
– The market offering is customized to
the needs of the target market.

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 Core Marketing Concepts
TARGET MARKETING

• Target marketing requires marketers to take

three major steps:
– Market segmentation: Identifying and profiling distinct
groups of buyers who differ in their needs and
preferences.
– Market targeting: Selecting one or more market
segments to enter.
– Market positioning: Establishing and communicating the
key distinctive benefit(s) of the company’s market
offering to each target. 22
 Core Marketing Concepts
Major Segmentation Variables for Consumer Market

Bases for
Segmentation
• Nation or country
• Geographic
• State or region
• Demographic
• City or metro size
• Psychographic
• Density (Urban, suburban, rural)
• Behavioral
• Climate

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 Core Marketing Concepts
Major Segmentation Variables for Consumer Market

• Age, race (Asian, Hispanic, black, white), gender

Bases for • Income, education
Segmentation • Family size
• Family life cycle
• Geographic • Occupation
• Demographic • Religion, nationality
• Psychographic • Generation (Baby boomer, Generation X,
Generation Y)
• Behavioral • Social class (lower lowers, upper lowers, lower
middles, middle middles, upper middles, lower uppers,
upper uppers ).
* Hispanic: People originally came from Spain; * Baby boomer: The 78 million people born during
the baby boom, following World War II and lasting until the early 1960s. * Generation X: The 45
million people born between 1965 and 1976 in the “birth dearth” following the baby boom; 24
Generation Y: The 72 million children born between 1977 and 1994.
 Core Marketing Concepts
Major Segmentation Variables for Consumer Market

Bases for • Lifestyle (Achievers, strivers, strugglers)

Segmentation – Activities
– Interests
• Geographic – Opinions

• • Personality (Compulsive, gregarious,

Demographic authoritarian, ambitious)
• Psychographic
• Behavioral
*Lifestyle: A person’s pattern of living as expressed in his or her activities, interests, and opinions.

* Personality: A person’s distinguishing psychological characteristics that lead to relatively consistent

and lasting responses to his or her own environment. *
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 Core Marketing Concepts
Major Segmentation Variables for Consumer Market

Bases for • Occasions (Regular occasion, special occasion)

Segmentation • Benefits (Quality, service, economy, convenience,
speed)

• Geographic • User status (nonuser, ex-user, potential user, first-

time user, regular user)
• Demographic • Usage rate / User rate (light user, medium
• Psychographic user, heavy user)
• Loyalty status (None, medium, strong, absolute /
• Behavioral hardcore loyal)
• Buyer-readiness (Unaware, aware, informed,
interested, desirous, intending to buy )
• Attitude (Enthusiastic, positive, indifferent, negative,
hostile) 26
 Core Marketing Concepts
Major Segmentation Variables for Business Market
A. Demographic
1. Industry: Which industries should we focus on?

2. Company size: What size companies should we focus on?

3. Location: What geographical areas should we focus on?

B. Operating variables

4. Technology: what customer technologies should be focused on?

GSM networks are far more popular globally, but in the US, Verizon Wireless, a CDMA network,
boasts the highest number of subscribers and broadest coverage in the country. (Apr 19, 2021)

5. User - nonuser status: should we focus on heavy users, medium users, light users,
or new users?
6. Customer capabilities: should we focus on customers needing many or few 27
services?
 Core Marketing Concepts
Major Segmentation Variables for Business Market

C. Purchasing approaches

7. Purchasing - function organization: should we focus on companies with highly

centralized or decentralized purchasing organizations?

8. Power structure: should we focus on companies that are engineering dominated,

financially dominant, and so on?

9. Nature of existing relationships: should we focus on companies with which we

have strong relationships or simply go after the most desirable companies?

10. General purchase policies: should we focus on companies that prefer leasing?
Service contracts? Systems purchases? Sealed bidding?

11. Purchasing criteria: should we focus on companies that are seeking quality?
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Service? Price?
 Core Marketing Concepts
Major Segmentation Variables for Business Market

C. Purchasing approaches
10. General purchase policies: should we focus on companies that prefer
leasing? (A lease is a legal agreement that allows someone to pay money so that they can
use an asset such as a car or building for a particular period of time. The lease on the building
will be up in May. They signed a lease for 426,000 square feet of office space.)
Service contracts?
Systems purchases? (buying a complete solution to a problem or need rather than a
number of component parts; for example, an organization may purchase an entire
accounting system from one supplier rather than computers from one supplier, software from
another, staff training from another, and so on.) 
Sealed bidding? (Sealed bidding is a method of contracting that employs
competitive bids, public opening of bids, and awards. Bidders must submit sealed bids to be
opened at the time and place stated in the solicitation for the public opening of bids.)
11. Purchasing criteria: should we focus on companies that are seeking quality?
Service? Price? 29
 Core Marketing Concepts
Major Segmentation Variables for Business Market

D. Situational factors
12. Urgency: should we serve companies that need quick and sudden delivery or
service?
13. Specific application: should we focus on certain applications of our product
rather than all applications?
Used as a moisturizer to treat or prevent dry, rough, scaly, itchy skin and minor skin irritations (e.g.,
diaper rash, skin burns from radiation therapy). 
In the pharmaceutical industry, glycerin is used as a sweetener in syrups, lozenges, and as an
excipient in eyewash solutions. 
14. Size of order: should we focus on large or small orders?
E. Personal characteristics
15. Buyer seller similarity: should we serve companies whose people and values are
similar to ours?
16. Attitudes toward risk: should we serve risk-taking or risk avoiding customers?
17. Loyalty: should we serve companies that show high loyalty to their suppliers?
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 Core Marketing Concepts

• Needs describe basic human requirements such as food, air, water,

clothing, shelter, recreation, education, and entertainment.
• Needs become wants when they are directed to specific objects that might
satisfy the need. (Fast food).
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 Core Marketing Concepts

• Needs describe basic human requirements such as food, air, water,

clothing, shelter, recreation, education, and entertainment.
• Needs become wants when they are directed to specific objects that might
satisfy the need. (Coca Cola).
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 Core Marketing Concepts

• Demands are wants for specific products backed by an

ability to pay.
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 Core Marketing Concepts

• A Product is any offering that can satisfy a need or

want, while a brand is a specific offering from a known
source.
• When offerings deliver value and satisfaction to the
buyer, they are successful.
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 Value and Satisfaction
Customer Value: benefit that the customer
gains from owning and using a product
compared to the cost of obtaining the
product.
Customer Satisfaction: depends on the
product’s perceived performance in
delivering value related to a buyer’s
expectations. Linked to Quality and Total
Quality Management (TQM).
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 Value and Satisfaction

Value can be expressed by:

Benefits
Value =
Costs
Functional benefits + Emotional benefits
Value =
Monetary costs + time costs + energy
costs + psychic costs

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 Enhancing Value

• Marketers can enhance the value of

an offering to the customer by:
– Raising benefits.
– Reducing costs.
– Raising benefits while lowering costs.
– Raising benefits by more than the
increase in costs.
– Lowering benefits by less than the
reduction in costs.
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 Choosing Between
Two Value Offerings

The customer who is choosing between two

value offerings, V1 and V2, will examine the
ratio V1 / V2.
He / She will favor V1 if the ratio is larger
than one;
he / she will favor V2 if the ratio is smaller
than one;
and he / she will be indifferent if the ratio
equals one.
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Exchange and Transaction
How Can a Person Obtain a Product?

The person can:

• Self-produce the
product or service
• Use force to get the
product
• Beg
• Offer a product, a
service, or money in
exchange for
something he or she
desires. 39
Exchange and Transaction
How Can a Person Obtain a Product?

The person can:

• Self-produce the
product or service
• Use force to get the
product
• Beg
• Offer a product, a
service, or money in
exchange for
something he or she
desires. 40
Exchange and Transaction
How Can a Person Obtain a Product?

The person can:

• Self-produce the
product or service
• Use force to get the
product
• Beg
• Offer a product, a
service, or money in
exchange for
something he or she
desires. 41
Exchange and Transaction
How Can a Person Obtain a Product?

The person can:

• Self-produce the
product or service
• Use force to get the
product
• Beg
• Offer a product, a
service, or money in
exchange for
something he or she
desires. 42
Exchange and Transaction
For exchange potential to exist, five
conditions must be satisfied:
• There are at least two parties
• Each party has something that might be of
value to the other party
• Each party is capable of communication and
delivery
• Each party is free to accept or reject the
exchange offer
• Each party believes it is appropriate or
desirable to deal with the other party
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Exchange and Transaction

• Exchange involves obtaining a desired

product from someone by offering
something in return. Five conditions
must be satisfied for exchange to occur.
• Transaction involves at least two things of
value, agreed-upon conditions, a time of
agreement, and a place of agreement.

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Exchange and Transaction

Exchange is a process rather

than an event. Two parties are
engaged in exchange if they
are negotiating – trying to
arrive at mutually agreeable
terms. When an agreement is
reached, we say that a
transaction takes place.

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Exchange and Transaction
There are two types of transactions:

• monetary transaction and

• barter transaction. 46
Exchange and Transaction
There are two types of transactions:

• monetary transaction and

• barter transaction. 47
 Core Marketing Concepts
• Relationship marketing aims to build long-term
mutually satisfying relations with key parties,
which ultimately results in marketing network
between the company and its supporting
stakeholders.

Four key constituents  for relationship marketing are  customers, employees, 

marketing partners  (channels, suppliers, distributors, dealers, agencies), and 
members of the financial community  (shareholders, investors, analysts).   
A  marketing network  consists of the company and its supporting stakeholders-
customers, employees, suppliers, distributors, retailers, ad agencies, university 
scientists, and others with whom it has built mutually profitable business 
relationships. (Unique company asset)
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 Core Marketing Concepts

Marketing Channels
• Communication
channels
• Distribution channels
• Service channels

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 Core Marketing Concepts

Marketing Channels • Deliver messages to and

receive messages from
• Communication target buyers.
channels • Includes traditional
• Distribution channels media, non-verbal
• Service channels communication, and
store atmospherics.

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 Core Marketing Concepts

Marketing Channels • Display or deliver the

physical products or
• Communication
services to the buyer /
channels
user.
• Distribution channels
• Service channels

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 Core Marketing Concepts

Marketing Channels • Carry out

transactions with
• Communication
potential buyers by
channels
facilitating the
• Distribution channels
transaction.
• Service channels

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Core Marketing Concepts

• A supply chain stretches

from raw materials to
components to final
products that are
carried to final buyers.

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THANK YOU

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