MARKETING MANAGEMENT

DEFINING MARKETING
FOR THE NEW REALITIES

SESSION 1
 QUOTES FROM MARKETING 4.0
“The major premise of this book is that marketing
should adapt to the changing nature of customer paths
in the digital economy.

“The role of marketers is to guide customers throughout

their journey from awareness and ultimately to
advocacy.”
 QUOTES FROM MARKETING 4.0
 “In this transitional era, a new marketing approach is
required.

 “We believe that technology convergence will

ultimately lead to the convergence between digital
marketing and traditional marketing.”
 TALKING OF “CONVERGENCE”…
• Amazon pioneered online retail, but is now
converging in a unique manner with traditional
retail…
IS MARKETING AN ART OR SCIENCE?

 The debate on the question began in the

Journal of Marketing in 1945…
IS MARKETING AN ART OR SCIENCE?

 During the 20th century Marketing was seen as ART!

Creativity mattered most.

 TODAY, Marketing is sees as “part ART & part

SCIENCE”!
 BOTH AN ART & A SCIENCE?
Kotler settled this by stating that:

“ It is both an art and a science, and it results from

“
careful planning and execution, using state-of-the-art
tools and techniques.
…Philip Kotler
KOTLER’S DEFINITION of 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.
 MARKETING’S NEW REALITIES

• Much has changed in the world today, and so has

our understanding of Marketing as well.
• Technology [the Internet, in particular] has served as
been a key enabler of change both from companies’ as
well as customers’ perspective.
 MARKETING’S NEW REALITIES
 The internet only become commercially available in
1990.
 Today it brings unparalleled connectivity &
transparency to our lives.
 Nearly 60% of the world’s population (i.e.4.7 billion)
has access to and is impacted by the internet.
 MARKETING’S NEW REALITIES
 The internet has been largely responsible for major
power shifts in Marketing as well.
 Real power, previously a domain of large marketing
companies has shifted into the hands of consumers.
 Marketing, like other disciplines, strives to change &
adjust to the realities of a changing world.
 MARKETING’S NEW REALITIES

• From being at the receiving end of goods and

services pushed by big marketing companies,
customers have come into their own.
• With power in their hands, customers are in a
position to not just demand superior customer value,
but define it as well.
 MKTG’S CORE CONCEPTS

• Many of Marketing’s core concepts remain in use, but

their meaning/ interpretation has changed.
• Hence our understanding of Marketing must also evolve
& adjust to cater to these changes.
 MKTG’S CORE CONCEPTS:
TALKING ABOUT NEEDS…

• CONSUMER NEEDS & WANTS have been the focus of

attention for Marketing for many years…
• …these are considered as basic standards today.
• CONSUMERS today have DEMANDS & EXPECTATIONS
FROM COMPANIES…because “needs” any company can
fulfill!
 MKTG’S CORE CONCEPTS:
TALKING ABOUT NEEDS…

 Customers often have needs which they are not fully

conscious of, or cannot articulate.
 Responding only to the “stated needs” may leave the
customer dissatisfied.
 How can companies overcome this problem?
 By gaining better customer insight through
sophisticated tools available for data analytics.
 VALUE & SATISFACTION

1. Buyers today choose offerings (a combination of products

& services) based on ‘perceived value’.
2. Value defined in terms of quality, service, and price - the
“customer value triad”.
3. Satisfaction reflects a customers’ judgment of perceived
performance in relationship to expectations.
 REVISITING POSITIONING…
 WE ALL KNOW WHAT IS POSITIONING – OR DO WE?

• OLD DEFINITION OF • CONTEMPORARY DEFINITON

POSITIONING: OF POSITIONING:
the place a brand a unique value offered by a
occupies in the mind of brand that is distinct from
the customer. competition.
WHAT MAKES MORE SENSE TO YOU?
 REVISITING MARKET SEGMENTATION
 WHAT IS MARKET SEGMENTATION? WHAT IS
THE BEST WAY TO SEGMENT A MARKET?
• TRADITIONAL approach: Top-down segmentation, based on
physical characteristics i.e. demographics, ‘geographics’, &
psychographics.
• The problem: Traditional approach is based in the assumption that
physical characteristics are a fair indicator of consumption
behavior - BUT THEY ARE NOT!
 REVISITING MARKET SEGMENTATION
 WHAT IS MARKET SEGMENTATION? WHAT IS
THE BEST WAY TO SEGMENT A MARKET?
The Solution:
• CONTEMPORARY approach: Bottom-up segmentation, that
uses customers’ past behavior data, from credible databases
on the internet, to predict future purchases.
• Research has substantiated that past behavior is a better
indicator of future behavior.
 REVISITING SOME CORE MARKETING
CONCEPTS
 WHAT IS THE BOTTOM UP APPROACH?
 HOW DOES IT WORK?

• Bottom-up approach is referred to as aggregation.

• How does it work?
• The process involves observing individual customers’ purchase
behaviors over time, and aggregating ‘like-behaving’ customers
into a ‘like-behaving group” that becomes a perfect segment.
REVISITING SOME CORE MARKETING
CONCEPTS
THE BEST WAY TO SEGMENT A MARKET?
Top-down versus Bottom-up approach
 HOW MEDIA HAS CHANGED: IS IT ALL
‘PAID’ NOW?

• In the Digital domain, Media falls under 3 categories:

1. PAID MEDIA: TV, print, magazine, social media sites where
company needs to pay for placing ads.
2. OWNED MEDIA: Company’s own website or its extension
(blogs/ social media channels) managed by company.
3. EARNED MEDIA/ MEDIA FOR FREE’: Online WOM,
reviews, reposts or comments that can go viral.
 THE POWER… OF SOCIAL MEDIA
• Many companies/ marketers still do not appreciate the value of
Social Media.
• They spend less on Social Media than on TV, Print, or Outdoor –
“because it costs less”. Is that rational?
• Most media expenditure on traditional media is wasted, even if
the signals reach a larger audience. Isn’t that true?
• The problem: Conversion is not used as a measure of advertising
effectiveness for TV, Print, Outdoor.
 THE POWER… OF SOCIAL MEDIA

 What is the metric used:

• On TV: Reach & Frequency.
 What counts on the Internet & Mobile?
• Impressions count, but Engagement counts more.
 Note: In many countries, rise of the internet has not
eliminated TV.
 CAREEM:
RIDING THE WAVE OF SOCIAL MEDIA…
Easy, Friendly and
Relatable
Careem’s customer
Careem’s Business? Careem’s customer?
values?

Transportation and People who want to improve Simpler Lifestyle

Logistics their Lifestyle

Mission To make people’s lives simpler by revolutionizing

Statemen the transportation and logistics industry in the
t region.
 FOUR MARKET DRIVERS…

…THAT DRIVE MARKETS TODAY!

 FOUR MAJOR MARKET FORCES

1. TECHNOLOGY: Huge amounts of data now available to

consumers and marketers, that help in agile and informed
decision-making.
• Tech-developments have led to new business models. Netflix,
Amazon, Airbnb, & Uber are examples of companies that
used technology to disrupt markets & become major
players.
 FOUR MAJOR MARKET FORCES

1. TECHNOLOGY…
• Advances in data analytics, machine learning, and artificial
intelligence can enable companies in better understanding
customers & tailoring their offerings to consumers’ needs.
• Technology is also available to smaller companies now,
that do not need the kind of resources needed in the past.
 THREE MARKET DRIVERS

2. GLOBALIZATION has created more level playing fields

offers competitors across the globe an equal chance to
succeed.
• With lower geographic & political barriers, as well as
advanced telecom technologies & workflow platforms,
companies & individuals can work across national
boundaries to create new opportunities.
 THREE MARKET DRIVERS

3. PHYSICAL ENVIRONMENT: Two far-ranging changes in

physical environment deserve special attention: climate
change (warmer-climate & rising seas) & global health
conditions (such as pandemics) can cause major disruptions
for businesses, as has been experienced recently.
 THREE MARKET DRIVERS
4. SOCIAL RESPONSIBILITY: Businesses have to become
more accountable and answerable to customers than ever
before.
• Marketers must explain their actions in the ethical,
environmental, legal, and social context today.
• Big brands like Nike, Starbucks, Gucci, Prada have been
under fire from consumers.
 NEW CONSUMER CAPABILITIES Pg.36
• The 4 forces can provide consumers & companies with new
capabilities, but also create new challenges—
• Consumers can use online resources:
• As powerful source of information to extract more value.
• To search, communicate, purchase on the move.
• Freely share opinions and express loyalty.
• Actively interact with companies.
• Reject the ‘marketing’ they find inappropriate.
 NEW COMPANY CAPABILITIES

• COMPANIES ALSO CAN:

• Collect richer information about markets, customers,
prospects, competitors.
• Reach consumers quickly & efficiently with targeted
information & promotional materials.
• Improve key processes & cost efficiency using
technology – at a lower cost.
 GLOBAL COMPETITION IS INTENSE!

• Cross-industry competition is a reality across many

industries.
• Privatization & deregulation has opened up new
markets globally in sectors like Telecom & Financial
services.
• Local/ regional brands like Haier, Hyundai & others,
have a standing in Global markets.
 RETAIL IS UNDERGOING MAJOR
TRANSFORMATION…

• Traditional retailers faces competition from

ecommerce. Their response: Make shopping a more
entertaining experience.
• Multichannel retailing is taking hold.
• “Brick-and-mortar”/ “Brick-and-click” services are
offered side by side.
CONSUMERS LEAD THE WAY, NOT COMPANIES…

• Do you agree? Why? Why not?

• Consumers moving faster than marketers in rural &
urban markets.
• Consumption patterns rapidly changing in the
interconnected world.
• Companies balancing between traditional & online
marketing. Choosing one is not an option!
ACCOUNTABILITY & COLLABORATION ON THE
RISE!

• More accountability expected from Marketing in

companies today - ROI/ ROMI targets against budgets.
• Cross-functional collaboration ensures:
1. Better product-innovation/ Communication
2. Faster customer acquisition, customer retention &
order fulfillment.
 ACCOUNTABILITY & COLLABORATION

• Some examples of Accountability:

• Dove campaign: From ‘Evolution’ [airbrushed &
photoshopped images] to ‘Real Beauty’ campaign -
defining beauty the “customer way”.
• Starbucks: buying 100% ethically sourced coffee. $50M
Starbucks Global Farmer Fund. 
STABBUCKS
ACCOUNTABILITY & COLLABORATION

• How about some more examples?

THE IBM INITIATIVE…
 THE UNILEVER INITIATIVE…
• “CRAFTING BRANDS FOR LIFE”
 CLASS EXERCISE
Q.1. Why is there a need for Marketing to evolve?
Q.2. How has the definition of Marketing itself evolved and why?
Q.3. Discuss the core concepts of Marketing. How have their
meanings changed?
Q.4. Discuss the FOUR FACTORS that have impacted Marketing
over the last decade.