CHAPTER 3

MARKETING
CONCEPTS AND
TRENDS
 WHAT IS MARKETING?
1. Marketing is the social process by
which individuals and groups obtain
what they need and want through
creating and exchanging products
and value with others

2. Marketing is everything you do to

place your product or service in the
hands of potential customers.
Goods are tangible products
Products that can be touched

Services are intangible products

Products that can not be touched
Ticket buying
services

Optician
Marketing Strategies
 Process that allow company to focus on
limited resource through various
opportunities to increase sales in competitive
industry.

Marketing Functions
 Company will identify the product and it’s
resource so that they can compare with
other products.
 SEVEN FUNCTIONS OF
MARKETING

MIM=Marketing
Information Management
 CORE MARKETING CONCEPTS:
NEEDS, WANTS AND DEMANDS
• Needs are the basic human requirements. People
need air, food, water, clothing and shelter to survive.

• Wants are shaped by our society. E.g:Mutusamy

need food, but he want chapaty, tosei & curry.

• Demands are wants (desire) for specific products

backed by an ability and willingness to pay.
 The Technology Revolution in
Marketing
• Technology: Application to business of
knowledge based on scientific discoveries,
inventions, and innovations
• Technological advances are revolutionizing
marketing – WSJ articles

• Interactive marketing: refers to buyer-seller

communications in which the customer controls
the amount and type of information received from
a marketer
• The Internet is an all-purpose global network
composed of more than 50,000 different networks
around the globe that allows those with access to a
computer send and receive images and text
anywhere
• World Wide Web is an interlinked collection of
graphically rich resources within the larger Internet
• Broadband technology is extremely high speed,
always-on Internet connection
• Wireless Internet connections for laptops and PDA’s
• Interactive Television Service (iTV) allows
consumers to interact with programs or commercials
through their remote controls
• How Marketers
Use the Web
– Interactive
brochures
– Online
newsletters
– Customer
service tools
• What other ways
can you think of?
Costs and Functions of Marketing
 Why Internet Marketing Now?

 Traditional Marketing Tactics Becoming

Less Effective
 Benefits of Internet Marketing
Targeted
Measurable
Cost-Effective

 Smart Allocation During a Downturn

But What, Exactly, Is Internet Marketing?

Key Components
1. Website Design
2. Search Engine
Optimization
3. Social Media Marketing
4. Pay Per Click
Advertising
5. Email Marketing
 WHAT IS PRODUCT AND
SERVICES?
• Products are the things offered to the market which
can attract user, can be owned, used and provide
certain benefits to satisfy user during exchange.

• Services are intangible entities which are offered in

the marketing by Organization with product or
separately. The objective of service remain similar
to product fulfilling wants or demands of
customers.
 Differentiate Between Product
and Services
Products
Produces first then sold
Physical and tangible
An item that can be used and
touched
Can be stored or transported
Eg: TV, computer
Services
Sold first, then produced
Not physical and intangible
Service is a deed performed by
one party for another. When you
provide a customer with a service,
the customer can’t keep it. The
service is experienced, used, or
consumed.
Can’t be stored or transported
Eg: pizza delivery
 TYPES OF PRODUCTS AND
SERVICES
• Consumer products
• Convenience
• Shopping
• Specialty
• Unsought

• Industrial products
• Material or spare part
• Capital item
• Supplies and services
 PRICING

• price is the amount of money or goods for

which a thing is bought or sold.
• A customer’s motivation to purchase a
product
i. from a need and a want.
ii.from a perception of the value of a product in
satisfying that need/want
 METHODS OF PRICING
PRODUCTS AND SERVICES

• Cost Based Pricing

• Market Based Pricing
 • Cost-based pricing is the price that you charge to
cover the cost and make profit.

• Pricing-based cost is you charge the price that

your customers are willing to pay. In this case  you
need to study your target group and their
characteristics. If you don’t want to pay high price
for your product, you reduce the cost in production.
Then, adjust the price that they want to pay.

 The process of bargaining among many buyer and

many sellers in a competitive market
 PROMOTION

• An activity to let
people know about
goods and services
in a positive way
that will make them
want to buy.
PROMOTION OF PRODUCTS
AND SERVICES

A) E-marketing
B) Advertising
C) Sales Promotion
 E-MARKETING
• E-Marketing is the activity, set of
institutions, and process for creating,
communicating, delivering, and
exchanging offerings that have value for
customers, clients, partners, and society
at large, of products or services over the
Internet.
• Example: lelong.com, airasia.com.my
 WHAT IS E-MARKETING?
• E-MARKETING or electronic marketing
refers to the application of marketing
principles and techniques via electronic
media and more specifically the Internet.

• E-MARKETING is the process of marketing

a brand using the Internet. It includes both
direct response marketing and indirect
marketing elements and uses a range of
technologies to help connect businesses to
their customers.
 WHY IS IT IMPORTANT?

• When implemented correctly, the return on

investment (ROI) from eMarketing can far
exceed that of traditional marketing
strategies.
• It can be a means to reach literally millions of
people every year. It's at the forefront of a
redefinition of way businesses interact with
their customers
 THE BENEFITS OF E-MARKETING
OVER TRADITIONAL MARKETING
• The nature of the internet means businesses
now have a truly global reach.

• While traditional media costs limit this kind of

reach to huge multinationals, eMarketing opens
up new avenues for smaller businesses, on a
much smaller budget, to access potential
consumers from all over the world.
 SCOPE
• Internet marketing allows the marketer to
reach consumers in a wide range of ways
and enables them to offer a wide range of
products and services.
• eMarketing includes, among other things,
information management, public relations,
customer service and sales.
• With the range of new technologies
becoming available all the time, this scope
can only grow.
 INTERACTIVITY

• Whereas traditional marketing is largely

about getting a brand's message out there,
e-marketing facilitates
conversations between companies and
consumers.
• With a two-way communication channel,
companies can feed off of the responses of
their consumers, making them more dynamic
and adaptive.
 IMMEDIACY
• Internet marketing is able to, in ways never before
imagined, provide an immediate impact

• With eMarketing, it’s easy to make that step as simple

as possible, meaning that within a few short clicks you
could have booked a test drive or ordered the iPod. And
all of this can happen regardless of normal office hours.
Effectively, Internet marketing makes business hours 24
hours per day, 7 days per week for every week of the
year.

• By closing the gap between providing information and

eliciting a consumer reaction, the consumer's buying
cycle is speeded up and advertising spend can go much
further in creating immediate leads.
 DEMOGRAPHICS AND
TARGETING

• The demographics of the Internet are a marketer's dream.

Internet users, considered as a group, have greater buying
power and could perhaps be considered as a population
group skewed towards the middle-classes.

• Buying power is not all though. The nature of the Internet is

such that its users will tend to organise themselves into far
more focussed groupings. Savvy marketers who know
where to look can quite easily find access to the niche
markets they wish to target. Marketing messages are most
effective when they are presented directly to the audience
most likely to be interested. The Internet creates the perfect
environment for niche marketing to targeted groups.
 ADAPTIVITY AND CLOSED LOOP
MARKETING
• Closed Loop Marketing requires the constant
measurement and analysis of the results of marketing
initiatives. By continuously tracking the response and
effectiveness of a campaign, the marketer can be far more
dynamic in adapting to consumers' wants and needs

• With eMarketing, responses can be analysed in real-time

and campaigns can be tweaked continuously. Combined
with the immediacy of the Internet as a medium, this means
that there's minimal advertising spend wasted on less
than effective campaigns

• Maximum marketing efficiency from eMarketing creates

new opportunities to seize strategic competitive
advantages
B) ADVERTISING
• Advertising is a message designed to promote or sell a
product, a service, or an idea.

• Advertising reaches people through varied types of mass

communication.In everyday life, people come into contact with
many different kinds of advertising.
1)Printed ads are found in newspapers and magazines.
2)Poster ads are placed in buses, subways, and trains.
3)Neon signs are scattered along downtown streets.
4)Billboards dot the landscape along our highways.
5)Commercials interrupt radio and television
programming.
TYPES OF ADVERTSING
• In marketing, type of advertising refers to the
primary “focus” of the message being sent and
falls into one of the following four categories:

• PRODUCT-ORIENTED ADVERTISING
• IMAGE ADVERTISING
• ADVOCACY ADVERTISING
• PUBLIC SERVICE ADVERTISING
1. PRODUCT-ORIENTED ADVERTISING
• The goal of product advertising is
to clearly promote a specific
product to a targeted audience. 
• Marketers can accomplish this in
several ways from a low-key
approach that simply provides
basic information about a product
(informative advertising) to blatant
appeals that try to convince
customers to purchase a product
(persuasive advertising) that may
include direct comparisons
between the marketer’s product
and its competitor’s offerings
(comparative advertising).
2. IMAGE ADVERTISING
• Image advertising is undertaken primarily
to enhance an organization’s perceived
importance to a target market. 
• Image advertising does not focus on
specific products as much as it presents
what an organization has to offer.  In
these types of ads, if products are
mentioned it is within the context of “what
we do” rather than a message touting the
benefits of a specific product. 
• Image advertising is often used in
situations where an organization needs to
educate the targeted audience on some
issue.  For instance, image advertising
may be used in situations where a merger
has occurred between two companies and
the newly formed company has taken on
a new name, or if a company has
received recent negative publicity and the
company wants to let the market know
that they are about much more than this
one issue.
3. ADVOCACY ADVERTISING
• Advocacy advertising is advertising
that is used to promote a particular
cause, point of view, or a matter of
public importance or interest.
• Advertising used in supporting a
particular Advocacy advertising can
be directed at either specific targets,
or general targets, such as political
activists, the media, consumer
groups, government agencies, or
competitors.
• Example : breast cancer funding.
Advocacy advertising is used to
generate funding through donation for
such causes
4. PUBLIC SERVICE ADVERTISING
• Designed to inform and
educate rather than
sell a product or
service
• For instance, ads
directed at social
causes, such as teen-
age smoking, illegal
drug use and mental
illness, may run on
television, radio and
other media without
cost to organizations
sponsoring the
advertisement
COMMUNICATION CHANNELS

Newspapers Personal Selling

Direct Mail Flyers
Radio Individual Referral
Television E-mail
Telephone Internet
Posters
37
C) SALES PROMOTION

• Sales promotions are generally short-term

incentives. These incentives are given to
encourage maximum sales of a product or
service; however these incentives are not for
consumers alone but can also be given to
wholesalers and retailers by the company.
• Sales promotions comprise various
communication activities, which try to offer added
value to customers to stimulate immediate sales.
 These efforts are made to create
product interest, purchase or trial.
 Example :
Price promotion
Coupons
Gift with purchases
Competition and prizes
Money refunds
HOW ? - BY WINDOW DISPLAYS

• Creative window displays are an ideal

way to set your business apart from
the competition.
• Windows are the billboard of your
store.
• Example: discount poster that been
glued as window display.
• Retail window displays can draw customers
into your store and create a strong brand. We
offer advice on how to make the most of your
store window displays.
• A neat, eye-catching window display is an
effective way to stop pedestrian traffic and
entice people to enter your store
 Marketing Environment
What?
•the combination of external and internal factors and forces
which affect the company’s ability to establish a relationship
and serve its customers.
•consists of an internal and an external environment. 

•Internal factor :  Forces and actions inside the firm that

affect the marketing operations composed of internal stake
holders and the other functional areas within the business
organization. Example :owners, workers, machines,
materials etc

•External factor: micro environment & macro environment

 Microenvironment
1. Company
- Markets has to work with all levels of management.
- Each departments have an impact on the plan and
actions of the marketing department.

2. Suppliers
- Marketers has to make sure that suppliers provide
raw materials according to schedule
- Supply shortage/delay can affect sales and
damaged customer goodwill
 Microenvironment
3. Marketing intermediaries
-Firms that help the company to promote, sell and distribute
the goods to final buyers (middleman)
-Include resellers, physical distribution firms, marketing
services agencies, financial intermediaries.

4. Customer
-marketing strategy is customer oriented that focuses on
understanding the need of the customers and offering the best
product that fulfils their needs
-Type of customers:
consumer, business, reseller, government, international
 Microenvironment
5. Competitors
-Keeping a close watch on competitors enables a company to
design its marketing strategy according to the trend prevailing
in the market.

6. Publics
-made up of any other group that has an actual or potential
interest or affects the company’s ability to serve its customers.
 Macro environment

1. Demographic
- Demographic data such as size, location, age,
gender, income level etc helps marketers when
establishing target market.

2. Economic
- Consists of factors that affect consumers
purchasing and spending powers
- Example: trends of gross national product,
patterns of real growth in income
 Macro environment
3. Natural
-Natural resources that are needed as inputs by marketers.
-Shortage raw material and energy sources can affect
production

4. Technological
-the biggest sources of threats and opportunities for the
organisation
-constitutes innovation, research and development in
technology, technological alternatives, innovation
inducements also technological barriers to smooth operation. 
 Macro environment
5. Political
-laws and government’s policies prevailing in the country.
-change in political parties, several changes are seen in
the market in terms of trade, taxes, and duties, codes and
practices, market regulations, etc.

6. Cultural
-the lifestyle, values, culture, prejudice and beliefs of
the people. This differs in different regions
-responsibility towards it must follow the marketing
practices that do not harm the sentiments of people 
Effective use of internet marketing
1. Convenience
•open for business around the clock without worrying about
store opening hours or overtime payments for staff. 
2. Reach
•overcome barriers of distance, sell goods in any part of the
country without setting up local outlets, widening your target
market.
3. Cost
•costs less than marketing them through a physical retail outlet,
do not have the recurring costs of property rental and
maintenance, do not have to purchase stock for display in a
store
Effective use of internet marketing

4. Personalization

5. Relationships
•begin the relationship by sending a follow-up
email to confirm the transaction

6. Social
•personalize offers to customers by building a
profile of their purchasing history and
preferences
Advantage and Disadvantage
marketing through social media
ADVANTAGE DISADVANTAGE
Large audiences Negative feedback
Free to create Potential for embarrassment
Encourages sharing Time intensive
Increases brand loyalty
Uncovers valuable insights
 CHANNEL OF DISTRIBUTION
• Distribution is all about getting your
product/service to the right people at the right
time with special consideration for profit and
effectiveness.
• When a product/service is purchased by a
consumer, it may have been bought directly from
the business, or it may have been through a
number of intermediaries (wholesaler, retailer, etc):
these are known as distribution channels
 CHANNEL OF DISTRIBUTION

• Manufacturer  Wholesalers  Retailers 

Customers
• Manufacturer  Agent  Retailers  Customers
• Manufacturer  Wholesalers  Customers
• Manufacturer  Retailers  Customers
• Manufacturer  Agent  Customers
• Manufacturer  Customers
 DISTRIBUTION INTERMEDIARIES

• Manufacturer
- Firms that manufacture product in a large
amount.

• Wholesalers
- organizations that purchase products from
suppliers, such as manufacturer or other
wholesalers, and in turn sell these to other
resellers, such as retailers or other
wholesalers.
• Jobber
- someone who buys large quantities of
goods and resells to merchants rather
than to the ultimate customers

• Retailers
- organizations that sell products directly
to final consumers.

• Customer
- people who buy and use the product all
over the place and all over the time.
 THE IMPORTANCE OF
DISTRIBUTION CHANNELS
1. Cost Savings in Specialization - Members
of the distribution channel are specialists in
what they do and can often perform tasks
better and at lower cost than companies who
do not have distribution experience.
Marketers attempting to handle too many
aspects of distribution may end up
exhausting company resources as they learn
how to distribute.
 THE IMPORTANCE OF
DISTRIBUTION CHANNELS

2. Reduce Exchange Time - Not only are

channel members able to reduce distribution
costs by being experienced at what they do,
they often perform their job more rapidly
resulting in faster product delivery.
3. Customers Want to Conveniently Shop
for Variety - Marketers have to understand
what customers want in their shopping
experience .
– Resellers within the channel of distribution serve two very
important needs:
they give customers the products they want by
purchasing from many suppliers (termed accumulating
and assortment services), and
they make it convenient to purchase by making
products available in single location.
 ACTIVITY
Discuss the Distribution and Give Example for each type

•Manufacturer  Wholesalers  Retailers  Customers

•Manufacturer  Agent  Retailers  Customers
•Manufacturer  Wholesalers  Customers
•Manufacturer  Retailers  Customers
•Manufacturer  Agent  Customers
•Manufacturer  Customers
THANK YOU