Marketing Management

Module:1
Chapter:1 Nature & Scope of Marketing

Introduction to Marketing

MM/M1/SS

From the time you wake up..

MM/M1/SS

 Turn off that alarm brush your teeth take a shower have breakfast get dressed travel to work use the copier go out for dinner at ____ - fall asleep We use more than 250 brands by the time our day ends !!

MM/M1/SS

Marketing is omnipresent ..!

The average person in a metro-city is exposed to over 3,000 advertising messages a day!! ...consciously or otherwise.
Source: http://www.superprofile.com

MM/M1/SS

 We are constantly being targeted !!

MM/M1/SS

Marketing is natural
Analogy of marketing with the natures law of survival of the fittest

MM/M1/SS

What is sold
A grocery shop sells Channa A restaurant sells ChannaBhatura MDH , a food company sells ready to eat channa masala Tata Consultancy Service sells TCS Certainity
MM/M1/SS

What is marketed Commodity Product Brand Solution

What is Marketed?
Goods Services Events & Experiences Persons Places & Properties Organizations Information Ideas
MM/M1/SS

Good Marketing is No Accident

The roaring success of four-wheeler Tata Ace, in a market earlier dominated by three-wheeler load carriers, was due to a deep understanding of the market needs and customer requirements.
MM/M1/SS

Lets define

MM/M1/SS

What is Marketing?
Marketing is 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.

MM/M1/SS

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.

MM/M1/SS

Marketing is the management process that identifies, anticipates and satisfies customer requirements profitably The Chartered Institute of Marketing

MM/M1/SS

The right product, in the right place, at the right time, and at the right price Adcock et al

Marketing is the human activity directed at satisfying human needs and wants through an exchange process

Philip Kotler
MM/M1/SS

 The AMA 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.

MM/M1/SS

No single definition or approach

But the common subject matters: The ability to satisfy customers, The identification of favorable marketing opportunities The need to create an edge over competitors The aim to increase market share mainly in target markets

MM/M1/SS

Some marketing Gurus..

MM/M1/SS

Selling is only the tip of the iceberg

There will always be a need for some selling. But the aim of marketing is to make selling superfluous. The aim of marketing is to know and understand the customer so well that the product or service fits him and sells itself. Ideally, marketing should result in a customer who is ready to buy. All that should be needed is to make the product or service available. Peter Drucker
MM/M1/SS

Key Customer Markets

Consumer Markets Global Markets

Business Markets

Nonprofit/ Government Markets

MM/M1/SS

Need, Want, Demand

Desire + Willingness + Purchasing Power

MM/M1/SS

Consumer , Buyer & Customer

Consumer :
A consumer is one who consumes goods and services.

Customer :
Customer are those who buy goods and services.

MM/M1/SS

Demand States
Negative Nonexistent Latent

Declining

Irregular

Full

Overfull

Unwholesome

MM/M1/SS

Demand
Negative Demand : * consumers dislike the product and may even pay a price to avoid it. * Eg. : vaccinations * Marketing Task : Market Analysis, Positive promotion, change belief & attitude of people, product redesign, lower price

MM/M1/SS

Demand
Nonexistent Demand : * consumers may be unaware of or uninterested in the product. * foreign language courses * Marketing Task : connect the benefits of the product with peoples needs and interests

MM/M1/SS

Demand
Latent Demand : * consumers may share a strong need that cannot be satisfied by an existing product * Harmless Cigarettes, More fuel efficient car * Measure the size of potential market, analyze strength of the company, develop goods and services to satify the demand

MM/M1/SS

Demand
Declining Demand : * consumers begin to buy the product less frequently or not at all. * Typewriter * analyze the causes of the decline and determine whether demand can be restimulated by new target markets, by changing product features or by more effective communication. * reverse declining demand through creative remarketing

MM/M1/SS

Demand
Irregular Demand : * consumer purchases vary on a seasonal, monthly, weekly, daily or even hourly basis. * tours and travels peak in weekends * Marketing Task : Synchromarketing Flexible pricing, promotion and other incentives
MM/M1/SS

New Consumer Capabilities

A substantial increase in buying power A greater variety of available goods and services A great amount of information about practically anything Greater ease in interacting and placing and receiving orders An ability to compare notes on products and services An amplified voice to influence public opinion

MM/M1/SS

Evolution of the marketing concept

MM/M1/SS

Company Orientations Towards the Marketplace

Production Concept Product Concept
Consumers prefer products that are widely available and inexpensive
Consumers favor products that offer the most quality, performance, or innovative features Consumers will buy products only if the company aggressively promotes/sells these products Focuses on needs/ wants of target markets & delivering value better than competitors
MM/M1/SS

Selling Concept
Marketing Concept

Societal Marketing Concept

(Human Welfare)

Society

Societal Marketing Concept

(Want Satisfaction)
MM/M1/SS

Consumers

Company
(Profits)

Figure 1.4 Holistic Marketing Dimensions

MM/M1/SS

Modern Marketing Concept Traditional

Organization Chart
Top Management

Middle Management
Front-line people Customers
MM/M1/SS

Modern Marketing Concept CustomerOriented Organization Chart

Customers
Front-line people Middle management

Top management
MM/M1/SS

Figure 1.1 Structure of Flows in a Modern Exchange Economy

MM/M1/SS

Figure 1.2 A Simple Marketing System

MM/M1/SS

Core Marketing Concepts

Needs, wants, and demands Target markets, positioning, segmentation Offerings and brands Value and satisfaction Marketing channels Supply chain Competition Marketing environment

MM/M1/SS

The Marketing Mix

Developed to achieve the companys objectives. Also called: 4 Ps of Marketing

MM/M1/SS

Product

MM/M1/SS

What is a Product?

A product is anything that can be offered to a market to satisfy a want or need, including physical goods, services, experiences, events, persons, places, properties, organizations, information, and ideas.

MM/M1/SS

Product Mix
Total sum of all products and variants offered by an organization (Hindustan Unilever Limited)

MM/M1/SS

Product Differentiation
Product form Features Customization Performance Conformance Durability Reliability Repairability Style
MM/M1/SS

Service Differentiation
Ordering ease Delivery Installation Customer training Customer consulting Maintenance and repair

MM/M1/SS

Product Life Cycle

MM/M1/SS

PRICE

MM/M1/SS

Definition:
In ordinary usage, price is the quantity of payment or compensation given by one party to another in return for goods or services.

MM/M1/SS

Objectives of Pricing
Short-term profit maximization Short-term revenue maximization Maximize quantity Maximize profit margin Differentiation Survival

Source: http://entrepreneurs.about.com/od/salesmarketing/a/pricingstrategy.htm
MM/M1/SS

Place

MM/M1/SS

Marketing Channels and Supply Chain Management

The fourth P of marketing (place)

Consumer Marketing Channels

0-level channel Manufacturer 1-level channel Manufacturer 2-level channel Consumer

Retailer

Consumer

Mfg

Wholesaler

Retailer

Consumer

3-level channel Mfg Wholesaler Distributor

MM/M1/SS

Retailer

Consumer

Promotion

MM/M1/SS

Concept of Promotion
Promotion is all personal and impersonal efforts by a seller to Inform Persuade or Remind a target audience.

MM/M1/SS

MM/M1/SS

Personal Selling
Direct presentation of a product to a prospective customer by a representative of the organization selling it.
Face to face Over the phone

MM/M1/SS

Advertising
The non-personal communication of information usually paid for & usually persuasive in nature, about products (goods & services) or ideas by identified sponsor through various media.
Broadcast media (TV, Radio) Print media (newspapers, magazines) Outdoor media (billboards) Internet Mobile phones Other media
MM/M1/SS

Sales Promotion
Incentives given to encourage sales and help personal selling.
Premiums Event sponsorships Contests Trade shows In-store displays, samples, rebates Discounts and coupons

If given to channel partners: Trade

MM/M1/SS

Promotion

Public Relations
Efforts to develop favorable attitudes and opinions about products/organizations
Newsletters Annual reports Lobbying, charitable events etc.

Publicity
News stories about organization & products

MM/M1/SS

Marketing Concept - The 4 Ps & The 4 Cs

Marketing Mix Product

Place

Customer Solution

Convenience
Price Promotion

Customer Cost

MM/M1/SS

Communication

Acoording to customer point of view-SIVA

Product Solution

Promotion
Price Place

Information
Value Access

MM/M1/SS

Marketing Concept - The 4 Ps

MM/M1/SS

The extended marketing mix

Also called the service marketing mix People Process Physical Evidence

MM/M1/SS

Glimpse of Marketing Specializations

Consumer Behavior Marketing Research Sales and distribution Integrated Marketing Communications Services Marketing International Marketing Brand Management

MM/M1/SS