Date post: | 15-Jul-2015 |
Category: |
Business |
Upload: | md-saifullah-khalid |
View: | 39 times |
Download: | 1 times |
Marketing Management by Arun Kumar and N Meenakshi© Vikas Publishing House Pvt. Ltd. 2006
CHAPTER 1FUNDAMENTALS OF
MARKETING
Marketing Management by Arun Kumar and N Meenakshi© Vikas Publishing House Pvt. Ltd. 2006
LEARNING OBJECTIVES• The marketing concept: An understanding of the
nature of marketing, its key components and limitations.
• The difference between production orientation and marketing orientation
• Service concept of marketing • Experience concept of marketing • Differing roles of efficiency and effectiveness in
achieving corporate success • Differences between market-driven and internally
driven businesses
Marketing Management by Arun Kumar and N Meenakshi© Vikas Publishing House Pvt. Ltd. 2006
Learning Objectives (contd.)
• Profile of customer-centric organizations • How an effective marketing mix is designed, and
the criticisms of the 4-Ps approach to marketing management
• Need for segmentation, targeting and positioning • Relationship between characteristics, market
orientation, adoption of a marketing philosophy and business performance
Marketing Management by Arun Kumar and N Meenakshi© Vikas Publishing House Pvt. Ltd. 2006
UNDERSTANDING MARKETING
• Process of finding out customer needs and serving those needs profitably
• Profit is a legitimate goal of a business organization
• Essence of marketing is providing desired value to customers
• Marketing should be considered a central business function
Marketing Management by Arun Kumar and N Meenakshi© Vikas Publishing House Pvt. Ltd. 2006
THE MARKETING CONCEPT
• All activities are focused upon providing customer satisfaction
• Every employee in an organization is a marketer
• Internal communication
Marketing Management by Arun Kumar and N Meenakshi© Vikas Publishing House Pvt. Ltd. 2006
PRODUCTION CONCEPT
• Inward looking orientation
• Management becomes cost focused
• Objective is cost reduction
• Business mission is focused on current production capabilities
• Manufacture products and aggressively sell them to customers
Marketing Management by Arun Kumar and N Meenakshi© Vikas Publishing House Pvt. Ltd. 2006
SELLING CONCEPT
• Product or service is not designed and made according to customer’s requirements
• Customer has to be persuaded to believe that the product or the service meets his requirements
• Customer dissatisfied and bad-mouths company
• Marketing makes selling redundant
Marketing Management by Arun Kumar and N Meenakshi© Vikas Publishing House Pvt. Ltd. 2006
PRODUCT CONCEPT • Companies become centered on constantly
improving the product
• Myopic focus on the product
• No attention on the other ways in which customers can fulfill their needs – MARKETING MYOPIA
• Customer does not buy a product, he buys an offering that fulfills his needs
Marketing Management by Arun Kumar and N Meenakshi© Vikas Publishing House Pvt. Ltd. 2006
SERVICE CONCEPT• Customers buy services, not products
• Service model of marketing instead of selling the title to the products
• Hindrance: Mindset of the customer and marketer, and their unwillingness to experiment with this model
• Can be easily applied in businesses like automobiles, carpeting, furnishing, and for most consumer durable items
Marketing Management by Arun Kumar and N Meenakshi© Vikas Publishing House Pvt. Ltd. 2006
EXPERIENCE CONCEPT • Create an experience around the product to
make it memorable • Reaffirm it with cues at every customer
interaction point • Experiences are inherently personal for a
customer• An experience should be built around a well
defined theme
Marketing Management by Arun Kumar and N Meenakshi© Vikas Publishing House Pvt. Ltd. 2006
Experience Concept (Contd.)
• Companies must introduce cues that affirm the nature of the experience to the guest
• Eliminate anything that diminishes, contradicts, or distracts from the theme
• Customers purchase memorabilia as a physical reminder of an experience
• The more senses an experience engages, the more effective and memorable it becomes
Marketing Management by Arun Kumar and N Meenakshi© Vikas Publishing House Pvt. Ltd. 2006
EFFICIENCY VERSUS EFFECTIVENESS
• An efficient company produces its products and services economically
• An effective company serves the needs of the customers
• No inherent conflict between being efficient and effective
Marketing Management by Arun Kumar and N Meenakshi© Vikas Publishing House Pvt. Ltd. 2006
• An inefficient but an effective company can remain in business though its profits would be lower
• An ineffective but an efficient company will not survive
• Choosing to become effective reflects the marketing orientation of the company
Efficiency Versus Effectiveness (Contd.)
Marketing Management by Arun Kumar and N Meenakshi© Vikas Publishing House Pvt. Ltd. 2006
MARKET VERSUS INTERNALLY DRIVEN BUSINESSES
MARKET DRIVEN BUSINESS
INTERNALLY DRIVEN BUSINESS
Display customer concern throughout the business
Fail to understand the real concerns of customers
Expenditure on marketing research is an investment
Marketing research is non-productive activity and rely on anecdotes and received wisdom
Understand competitors’ objectives and strategies, and anticipate competitive actions
Content to underplay the competition
Marketing spend is an investment that has long term consequences
Marketing expenditure Is superfluous that never appears to produce benefits
Marketing Management by Arun Kumar and N Meenakshi© Vikas Publishing House Pvt. Ltd. 2006
MARKET DRIVEN BUSINESS
INTERNALLY DRIVEN BUSINESS
Employees who take risks and are innovative in serving customers rewarded
Reward time serving, and ability to not make mistakes
Search for latent markets – markets that no other company has exploited
Happy to stick to their existing products and markets
Sensitive, fast and flexible to be able to respond to changes in the market
produce me-too copies of offerings already in the market
• Impact of marketers’ commitments
Market Versus Internally Driven Businesses (Contd.)
Marketing Management by Arun Kumar and N Meenakshi© Vikas Publishing House Pvt. Ltd. 2006
PROFILE OF CUSTOMER-CENTRIC ORGANIZATIONS
• Shared values and beliefs
• Skills in understanding and responding to customers
• Market intelligence
• Formal and informal means of information dissemination
• Responsiveness
Marketing Management by Arun Kumar and N Meenakshi© Vikas Publishing House Pvt. Ltd. 2006
• Desire to serve customer needs better than competition
• Organizational structure must reflect marketing strategy
• Clear communication
Profile of Customer-centric Organizations (Contd.)
Marketing Management by Arun Kumar and N Meenakshi© Vikas Publishing House Pvt. Ltd. 2006
LIMITATIONS OF THE MARKETING CONCEPT
• Marketing concept as an ideology
• Marketing and society
• Marketing as a constraint to innovation
Marketing Management by Arun Kumar and N Meenakshi© Vikas Publishing House Pvt. Ltd. 2006
MARKETING MIX
• PRODUCT
• PRICE
• PLACE
• PROMOTION
• CRITICISM OF THE 4Ps APPROACH TO MARKETING
Marketing Management by Arun Kumar and N Meenakshi© Vikas Publishing House Pvt. Ltd. 2006
CHARACTERISTICS OF AN EFFECTIVE MARKETING MIX
• Marketing mix should match customer needs
• True source of competitive advantage
• Well blended to form a consistent theme
• Match corporate resources
Marketing Management by Arun Kumar and N Meenakshi© Vikas Publishing House Pvt. Ltd. 2006
• SEGMENTATION, TARGETING, AND POSITIONING
Segmentation
Target markets
Positioning
• MARKETING ORIENTATION AND BUSINESS PERFORMANCE
Characteristics Of An Effective Marketing Mix (Contd.)