CHAPTER-ONE

OVER VIEW OF
MARKETING
MANAGEMENT
 Content outline

 Meaning, Scope and Importance of Marketing

 States of Demand and Marketing Tasks
 Marketing philosophies
 Developing Marketing Strategies and Plans
 Marketing related Concepts
 Needs, wants, and demands
 Offerings and brands
 Value and satisfaction
 Introduction
 Formally or informally, people and organizations
engage in a vast number of activities we could call
marketing.
 Good marketing has become increasingly vital for
success.
 But what constitutes good marketing is constantly
evolving and changing.
 The 21st Century Marketing Environment.
 At the beginning of the 21st century, the world is
facing a series of economic, financial, cultural, social,
demographic and political transformations that are
having a profound impact on lifestyle, on
consumption behavior, and managerial process of
organizations.
 The deepest changes are come from:
 Acceleration of economic globalization;
 The emerging of collaborative or sharing economy;
 Rapid technological innovation;
 Rapid climate and environmental changes;
 Amplified importance of services and intangible assets.
 The 21st Century Marketing Environment.

 In this ever-changing scenario marketers are facing

different challenges and opportunities ranging
from rethinking their theories and principles to
redesign the practices and decisions.
 1.1. Defining Marketing
 In classical terms marketing can be defined as the
performance of business activities that direct the
flow of goods and services from producers to
consumers (AMA)
 too narrow to describe marketing.

 emphasizes the distribution aspect.

 Cont’d…
 In broader terms marketing is defined as an
organizational function and a set of processes for
creating, communicating, and delivering value to
customers and for managing customer relationships
in ways that benefit the organization and its
stakeholders.
 According to Kotler P., 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.
 A social definition shows the role marketing plays in
society; “deliver a higher standard of living’’.
 Cont’d…
 Marketing is the anticipation, stimulation,
facilitation, regulation and satisfaction of consumer
and public’s demand for products, services,
organizations, people, places, and ideas through the
exchange process (Evans and Berman).
 Marketing is a system of business activities designed
to plan, price, promote and distribute want
satisfying goods and services to present and
potential customers (Stanton).
 One of the shortest good definitions of marketing is
“meeting needs profitably’’
 The Importance of Marketing
 Its importance:
 It realizes the dream and efforts of all functional units in

particular and of the firm in general.

 It helped introduce and gain acceptance of new products.

 It can inspire enhancements in existing products in the

marketplace.
 It builds demand for products and services, which, in turn,

creates jobs.
 It allows firms to more fully engage in socially responsible

activities.
 CEOs recognize the role of marketing in building strong brands
and a loyal customer base, intangible assets that contribute
heavily to the value of a firm.
 What is Marketing Management?

• Marketing management is the art and Science of

choosing target markets and getting, keeping, and
growing customers through creating, delivering, and
communicating superior customer value.
 Cont’d...
 Marketing management, according to Kotler, is “the
analysis, planning, implementation, and control of
programs to create, build, and maintain mutually
beneficial exchanges and relationships with target
markets for the purpose of achieving organizational
objectives”.
 Analysis in marketing management refers to
making a research on the preferences, attitude, test
and demand of customer.
 Cont’d...
 Marketing management is concerned not only with
finding and increasing demand, but also with
changing or reducing it.
 Marketing management seeks to affect the level,
timing, and nature of demand in a way that will
help the organization achieve its goals.
 The marketing management task is to manage
demand effectively.
 The Scope of Marketing

• Goods • Places

• Services • Properties

• Events • Organizations

• Experiences • Information

• Persons • Ideas or frame

work
 1.2 The Different States of Demand
• The state of demand levels and corresponding marketing
tasks:
• Negative demand:- a state in which all or most of the
important segments of the market dislike the product, and
conceivably may work to avoid it. Eg. Vegetarians feel
negative demand for meat.
• No demand:- a state in which all or most of the important
segments of the market are uninterested of indifferent to a
particular object.
• Falling demand:- consumers begin to buy the product less
frequently or not at all. The marketer must analyze the
cause of declining.
• Latent demand:- many customers may have a strong need
that can not be satisfied by any existing product. A need for
harmless cigarette. But the size of the potential market has
to be measured.
 Cont’d…
• Irregular demand:- a demand with seasonal
variation.
• Full demand:- firms face full demand when they are
pleased with their volume of business.
• Overfull demand:- a demand higher than they can
expect or capable or want to handle.
• Unwholesome demand:- a demand of a product or
services which are harmful to the society. Firms
devote their effort money, time to discourage the
consumption of such products.
 The Different States of Demand and marketing tasks

State of demand Marketing task Formal Name

1. Negative demand Disabuse demand Conversional marketing

2. No demand Create demand Stimulation Marketing

3. Latent demand Develop demand Developmental marketing

4. Falling demand Revitalized demand Remarketing marketing

5. Irregular demand Synchronize demand Synchro-marketing

6. Full demand Maintain Maintenance marketing

7. Overfull demand Reduce demand De-marketing

8. Unwholesome Destroy demand Counter marketing

demand
 1.3. Marketing Management Philosophies
 Company Orientation Toward the Marketplace
 Marketing philosophy refers to the assumption that
marketing managers underlie to make their marketing
decisions.
 It is belief that the right way of doing a business.
 There are five main business orientations, each of
which has emerged as a response to evolutions in the
marketplace:
 The production concept

 The product concept

 The Selling concept

 The marketing concept

 The Societal concept

 A. The production concept:
 This concept holds that consumers will favor those
products that are widely available and low in cost.
 They assume that consumers like products that are
widely available and accessible at low cost.
 It concentrates on achieving high production
efficiently and wide distribution coverage.
 Here consumers are more interested in obtaining
the product than in its fine points.
 B. The product concept:
• It assumes that consumers will prefer those
products that offer (provide) the most quality,
performance, with good features.
• their focus is on making quality products and
improving them over time.
• These managers assume that buyers admire well-
made products and can select, purchase and
appreciate product quality.
• Product oriented companies often design their
product with little or no customer input.
• They trust that their engineers know how to design
or improve the product.
 C. The Selling concept:
 They assume that consumers purchase products if
the organization undertakes an aggressive selling
and promotion effort.
 Therefore, firms emphasize and direct their effort
on promotion and selling of their products.
 Most firms practice the selling concept when they
introduce new products and when they have over
capacity.

 The organization must therefore undertake an

aggressive selling effort.
 D. The Marketing Concept
 Managers under this concept assumes that the key to
achieving organizational goals is based on the
determination of the needs and wants of consumers
and delivering or providing the desired satisfaction
more efficiently, and effectively, than competitors.

 Selling concept focuses on the needs of the seller;

marketing on the needs of the buyer.
 Cont’d…..
 Selling is preoccupied with the seller’s need to
convert the product into cash.
 Marketing is preoccupied with the idea of satisfying
the customers’ needs of the product.
 The marketing concept rests on four main pillars,
namely:
 target market,

 customer needs,

 coordinated marketing, and

 profitability.
 E. Societal Marketing Concept
 It holds that the organization should determine the
needs, wants, and interests of the target markets
and deliver the desired satisfaction more effectively
and efficiently than competitors in a way that
maintains or improves the customer’s and the
society’s well-being.
 It calls upon marketers to balance three
considerations in setting their marketing policies.
 Consumers wants
 Company profit
 Societal interest
 To conclude;

 Originally, companies based their marketing

decisions largely on short-run company profit.

 Overtime, companies began to recognize the long-

run importance of satisfying consumer wants, and
introduced the marketing concept.

 Now they are beginning to think of society’s

interests when making decisions.
 1.4. Developing Marketing Strategies and Plans

 How do companies compete in a global

marketplace?
 One part of the answer is a commitment to creating
and retaining satisfied customers.
 The second part: Successful companies know how to
adapt to a continuously changing marketplace
through:
 Strategic planning and

 Careful management of the marketing process.

 Marketing Plans and Planning
 A marketing plan has been defined as:

“ A written statement of the marketing aims of a

company, including a statement of the products,
targets for sales, market shares and profits,
promotional and advertising strategies, pricing
policies, distribution channels etc. with precise
specification of timescales, individual responsibilities
etc”. (Masner, 1988)
 Cont’d...
 A marketing plan is a written document that:
 Summarizes what the marketer has learned

about the marketplace and

 Indicates how the firm plans to reach its

marketing objectives.
 It contains:
 tactical guidelines for the marketing programs

and
 Resource allocations over the planning period.
 Cont’d...
 To achieve this marketing plan, the organisation need
to respond the following :
 Where are we now? - the analysis of the current
marketing situation.
 Where do we want to be in the future? - setting the
objectives.
 How can we get there? – creating the strategy
 How can we know when we get there? - monitoring
and evaluation.
 The marketing planning process

 The process can be split into four clearly defined

areas:
 Analysis,
 Planning,

 Communication,

 Action

 It is useful to think of the effective marketing process as a

triangle.
 The more time spent at the beginning on the
foundations of the strategy, the analysis and
planning stages, the stronger the top of the triangle
- the communications and action that result.
Cont’d...

Length of Time
Taken
This can be further broken down into defined actions:
 Cont’d...
 The most frequently cited shortcomings of current
marketing plans, according to marketing
executives, are:
 Lack of realism,

 Insufficient market analysis, and

 A short-run focus.
 Format of a typical marketing plan
1. Executive summary and table of contents: The
marketing plan should open with a table of contents
and brief summary on the main ideas incorporated in
the plan.
2. Situation analysis: This section presents relevant
background data on sales, costs, the market,
competitors, and the various forces in the macro-
environment.
 How do we define the market,

 how big is it, and

 how fast is it growing?

 What are the relevant trends and critical issues?

• Firms will use all these information to carry out a

SWOT analysis.
 Cont’d....
3. Marketing strategy: Here the marketing manager
defines:
 the marketing and financial objectives,

 the needs that the market offering is intended to

satisfy, as well as
 its competitive positioning.

 All this requires inputs from other areas, such as

finance, purchasing, manufacturing, sales, and

human resources.
 Cont’d....
4. Financial projections: Financial projections include:
 A sales forecast,

 an expense forecast, and

 a break-even analysis.

 On the revenue side is:

 forecasted sales volume by month and product

category, and
 On the expense side:
 the expected costs of marketing, broken down
into better categories.
 The break-even analysis:
 estimates how many units the firm must sell

monthly (or how many years it will take) to offset

its monthly fixed costs and average per-unit
variable costs.
 Cont’d....
 A more complex method of estimating profit is risk
analysis. Here we obtain three estimates for each
uncertain variable affecting profitability, under an
assumed marketing environment and marketing
strategy for the planning period.
 optimistic,

 pessimistic, and

 most likely
 Cont’d....
5. Implementation & controls:
 The last section outlines the controls for
monitoring and adjusting implementation of the
plan.
 Typically, it spells out the goals and budget for

each month or quarter, so management can

review each period’s results and take corrective
action as needed.
 Some organizations include contingency plans.
 Marketing Plan Criteria
 Here are some questions to ask in evaluating a marketing plan.
1. Is the plan simple?
 Is it easy to understand and act on?
 Does it communicate its content clearly and practically?
2. Is the plan specific?
 Are its objectives concrete and measurable?
 Does it include specific actions and activities, each with specific dates
of completion, specific persons responsible, and specific budgets?
3. Is the plan realistic?
 Are the sales goals, expense budgets, and milestone dates realistic?
 Has a frank and honest self-critique been conducted to raise possible
concerns and objections?
4. Is the plan complete?
 Does it include all the necessary elements?
 Does it have the right breadth and depth?
 Specific Content of the Market plan
1.0 Executive Summary
2.0 Situation Analysis
2.1 Market Summary
 2.1.1 Macro-environment

 2.1.2 Market Demographics

 2.1.3 Market Needs

 2.1.4 Market Trends and Growth

2.2 Competition analysis

2.3 SWOT Analysis
 2.3.1 Strengths

 2.3.2 Weaknesses
 Cont’d...
 2.3.3 Opportunities
 2.3.4 Threats

2.4 Keys to Success

3.0 Marketing Strategies
 3.1 Marketing Objectives

 Short-Term and long-term

 3.2 Financial Objectives

 3.3 Target Marketing

 3.4 Marketing Strategies to be used – the 4 P’s and

competitive position.
 Cont’d...

4.0 Financials, Budgets, and Forecasts

 4.1 Break-even Analysis

 4.2 Sales Forecast

 4.3 Expense Forecast

 4.5 Contribution Margin

5.0 Controls
 5.1 Implementation Milestones (specific points

measure)
 5.2 Marketing Organization

 5.3 Contingency Planning

 Assignment I (25%)
 Create a group consists of 6 members and Develop a
marketing plan for a hypothetically created product.
Locally produced or imported ones.
 Use the format discussed above.
 Support with tangible evidence for your efforts you
made to gather data – documents.
 Produce a report for the group and prepare power
point for presentation that will be presented by
randomly selected group member.
 Deadline: After a week
 CHAPTER
END