Introduction to Marketing

Dr. Ajay Pandit

December 01, 2009

What is marketing?

The Incredible India campaign was launched in the wake of the events of September 11, 2001 and the consequent impact on tourism. The campaign differentiated India from the competing destinations by developing a unique market position and image. The campaign was built around the brand proposition of – India : the voyage to the land of Ananda, the bliss.

What is Marketing?

Social definition

A societal process by which individuals and groups obtain what they need and want through creating, offering and freely exchanging products and services of value with others

What is Marketing?

AMA definition

Marketing is an organizational function and a set of processes for creating, communicating and delivering value to the customers and for managing customer relationships in ways that benefit the organizations and its stakeholders.

What is Marketing?

Marketing is a transaction or exchange through activities designed to generate and facilitate exchanges intended to satisfy human or organizational needs and wants.

What is Marketing?

Marketing is a total system of business activities designed to plan, price, promote and distribute want-satisfying products to target markets in order to achieve organizational objectives.

Needs and Wants

Needs are basic human requirementsWants are needs directed to specific

objects/services that might satisfy the need

Five Types of Needs

Stated Need (Consumer wants inexpensive Car) Real Needs (Car with low operating cost) Unstated Need (Expects good service from the

dealer) Delight Need (Extras) Secret Need (Wants to be seen by friends as a

savvy customer)

Exchange

Get something (product /service) by offering something in return.

Eg. kind (barter) or money (value )Exchange is a value creating process

because it leaves both parties better off

(win – win situation)

Transaction and Transfer

A transaction is an exchange between two things of value on agreed conditions and a time and place of agreement.

A transfer is a one way exchange without receiving anything in return.

Exchange

Five conditions must be satisfied: There are at least two parties Each party has something that might be of value

to the other party Each party is capable of communication and

delivery Each party is free to accept or reject the

exchange offer. Each party believes it is appropriate or desirable

to deal with the other party

What is marketed?

Goods / Products Services Events Experiences Persons Places Properties Organizations Information Ideas

“Commodities”

Water

Salt

Demand

This is the want for specific products backed by an ability to pay.

Target Market

Very rarely does a product cater to the entire market. Most products are designed to cater to a group of customers who specifically want such a product. This group of customers is the target market which is a slice of the total market. We say it is the market segment.

Value and Satisfaction

Value = Benefits/CostsBenefits = Functional Benefits + Emotional

benefitsCosts = Monetary costs + Time + Energy +

Psychic costs

Relationship Marketing

Building long term mutually satisfying relations with customers, suppliers, distributors in order to retain their long term preference and business

Marketing Network

A marketing network is the relationships built with its stakeholders. Effective relationships make up an effective and strong network.

Marketing Channels

Marketing channels are used to reach the target segment.

Communication channels

eg. Advertising, telephone enquiry systemDistribution channels – trade, direct sales

Supply Chain

The supply chain represents a value delivery chain – from procurement of raw materials to final delivery of product to consumer.

Competition

Potential and rival substitutes and offerings a buyer might consider.

Competition can be viewed in various perspectives – brand, industry, form, generic

Marketing Environment

CompetitionCustomersGovt. policiesSuppliersTrade

ProductImport tariffsTrendsTechnologyPolitics

Marketing Mix

It is the tools that an organization employs to pursue its marketing objectives in the target market

Product, Price, Place, Promotion4 C’s – Customer solution, Cost,

Convenience, Communication

The 4 Ps of Marketing

Product: is that which you trade for cash – your customers want your product and you want their cash

Price: The amount of money charged for a product or service

Promotion: How you will promote and create awareness of your product in the market place

Place: How you bring your product together with your customer - distribution

Traditional Marketing Model

Kotler,

4Ps in Action – The Marketing Mix

Your Business

Market place

Control of 4 independent variables (Marketing Mix)

Sales Volume Rs

Current economics

Legislation/Regulation

Political environment

Social trends

Cultural trends

Consumer confidence

Competition• New technology• Their 4 Ps

Uncontrollable

1. Product 2. Price3. Promotion4. Place

Evolution of Marketing

Marketing philosophy

Production conceptProduct ConceptSelling ConceptMarketing ConceptSocietal marketing Concept

1. Production Orientation

Focuses on internal capabilities of firm. “ Field of Dreams” strategy

– “If we build it, they will come” Best used when

– competition is weak – demand exceeds supply– generic products competing solely on price

Problem is that they don’t understand wants/needs of marketplace.

2. Sales Orientation

People will buy more goods/services if aggressive sales techniques are used.

High sales will result in high profits.Used with unsought products

– life insurance– encyclopedias

Problem is that they don’t understand wants/needs of marketplace.

3. Marketing Orientation

Marketing concept: The social and economic justification for an organization’s existence is the satisfaction of

customer wants and needs, while meeting organizational objectives.

3. Marketing Orientation . . .

Focusing on customer wants so the organization can distinguish its products from competitors’ .

Integrating all the organization’s activities, including promotion, to satisfy these wants.

Achieving long term goals for the organization by satisfying customer wants and needs legally and responsibly.

3. Marketing Orientation . . .

Requires:– Top management leadership– A customer focus– Competitor intelligence

strengths weaknesses

– Interfunctional coordination to meet customer wants/needs and deliver superior values.

4. Societal Marketing Orientation

Organization exists not only to satisfy customer wants/needs and to meet organizational objectives, but also to preserve and enhance individuals’ and society’s long-term best interests.

Extends marketing concept to serve one more customer - society as a whole.

 

ITC – Promoting Heritage India

Social Marketing

www.environment.delhigovt.nic.in

Differences between Sales & Marketing Orientations

Sales FocusOrganization’s

needsSelling

goods/services

Everybody

Profit through max. sales volume

Intensive promotion

Marketing FocusCustomer’s needsSatisfying

customer wants/needs

Specific groups of people

Profit through customer satisfaction

Coordinated mktg. activities (4 p’s)

Global Perspective

Questions

Answers