Introduction to

Marketing

Session - 1
 Peter Drucker, Management Guru says

What is the most important part of marketing…

Know and understand

the customer so well that
the product or service
fits him/her and sells
itself.
Name some products that you think is
successful in Indian market?
Why do you think it is/was
successful?
TATA ACE

In 2005, Tata Motors pioneered the small

commercial vehicle industry with the launch of
Tata Ace.

This revolutionized the last-mile delivery in the

Indian market.

Tata Ace has emerged as the trusted partner of

more than 23 lakh entrepreneurs and is the
single largest commercial vehicle brand in the
country.
Why did TATA ACE
succeed?
Tata ace was successful becoz..

BASED ON THE CUSTOMER WANT, THE COMPANY HAD MADE….

01 02 03 04 05 06
one ton vehicle, low maintaining navigate high driver driving comfort, social status
and operating through narrow safety, associated with
cost, roads, four wheeler.

Designed a right product based on the careful marketing homework and communicating
its value proposition to the right customer.
What is Customer value and Value
proposition?
 What is the Meaning of ‘ Customer Value’?

Customer Value = Total Customer Benefits - Total Customer Cost

– In Marketing, All ‘Value’ is Just ‘Perceived Value’

– The Challenge to the company is to Fulfil the Buyer’s Perceived Value

– Customer’s concern is: Am I getting my money’s worth?
– Satisfaction
– Is the product’s perceived performance (or outcome) better than expectations- delighted
– Is the product’s perceived performance (or outcome) meets the expectations- satisfied
– Is the product’s perceived performance (or outcome) below the expectations- dissatisfied
 Value proposition is a statement which says 'why' someone should buy the
companies product.

It should convince a potential customer  “why company service or product will

be of more value to them” than similar offerings from your competition.

Nirma Value proposition “ A

product that performed the
Value proposition supported
basic function of washing
by
clothes at a price affordable to
even low-income families”
• Distribution penetration
• Retailer relationship
• Word of mouth publicity
• Later on, media campaigns
Value proposition - example

Kindle: Easy to read on the go

Prime: Anything you want, quickly delivered

 What is marketing?

– American Marketing Association defined Marketing 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
benefits the organization and its stake holders”

“ the art and science of choosing Target markets and Getting, Keeping and Growing
customers through Creating, Communicating and Delivering superior customer
value”
Different concepts of Marketing in the
marketplace
What philosophy should guide the marketing
efforts?-Evolution of Marketing
Production concept

Product concept

Selling concept

Marketing concept

Holistic marketing
concept
 1. Production concept
(Operation oriented)

Assumption: Consumers would

prefer products that are widely
available and inexpensive.

So Managers concentrate on
achieving high production
efficiency, low costs and mass
distribution and do not
concentrate on other objectives.

Marketers use Production concept

when they want to expand the
market. Haier and lenova
expanded using the cheap labour
available in their country.
 Assumption: Consumers would prefer those
products that offer high quality, performance
or innovative features.

Managers focus on making superior products

and improving them over time. Startups have
learned the hard way.
2. Product
concept
Focus TOO MUCH on the product but forget
customer need, to price it attractively, make
it easily available (distributed), advertise and
sold properly, customer need
Assumption: if consumers and businesses are left on
their own, organization's products would not sell;
Hence sell “aggressively” regardless of quality and
need of the customer.

Selling concept is most practiced with unsought

products like insurance and encyclopedias or when
there is overcapacity
3. Selling
concept
Marketing based only on Selling Concepts runs high
risk. This philosophy doesn’t include building
relations with the customers. This means that
repeated sales are rare, and customer satisfaction is
not great.
4. Marketing Concept

Customer
Centered/customer
orientation i.e. “ Sense
and Respond”
Not “Right Customer for
Reactive market Generating customer Your Product” but “Right
orientation – expressed satisfaction Product for Your
needs Customer”.
Proactive market
orientation- Latent needs
Total market orientation
Dell computer’s provides a platform for it target market to
customize their products. Not right customer for your product
but right product for your customer
Difference between Sales and Marketing oriented companies

Sales oriented companies

– Very internally focused-needs of the seller
– concentrate to sell their product and make cash

Marketing oriented companies

– Externally focused --needs of the buyer
– Want to satisfy the customer with their
products
McCarthy’s Marketing Mix- Integrated Marketing
Delivering value to Ur Target market better
than Ur competitor

Marketing Mix

Place
Product Target Market Channels
Product variety Coverage
Quality Assortments
Design Locations
Features Inventory
Brand Name Transport
Packaging
Sizes Promotion
Service Price Sales Promotion
Warranties & returns List price Advertising
Discount price Sales Forces
Payment period Public relations
Credit term Direct Marketing
 Integrated Marketing

– According to Kotler, the four P’s represent the seller’s view of marketing tools available.

– Robert Lauterborn suggests that the seller’s P’s correspond to the customer’s C’s.

Four P’s Four C’s

Product Customer solution
Price Customer cost
Place Convenience
Promotion Communication

“No matter how smart you
are, if you don’t know how to
work with people, your
dreams will just be dreams”
Relationship
Marketing
– Relationship Marketing –Relationship marketing aims to
build mutually satisfying long-term relationships with key
constituents in order to earn and retain their business.
– 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).
 Internal Marketing

Internal Marketing – an element of marketing, is the task of hiring, training, and

motivating able employees who want to serve customers well. It ensures that everyone in
the organization embraces appropriate marketing principles, especially senior
management.
 Performance Marketing

Performance Marketing – requires understanding the financial and non-financial

returns to business and society from marketing activities and programs.

– Smart marketers go beyond sales revenue to examine the marketing scorecard and interpret
what is happening to market share, customer loss rate, customer satisfaction, product quality,
and other measures.
– They also consider the legal, ethical, social and environmental effects of marketing activities and
programs.