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Introduction to Marketing

I UNIT

Needs, Wants, Demands, Products, Exchange,

Transactions, Market, Marketing, Production Concept,

Product Concept, Sales Concept, Marketing Concept,

Societal Marketing Concept, Indian Marketing

Environment. Role and functions of marketing

department.

Need , Wants and Demand:

A human need is a state of felt deprivation of some basicsatisfaction. People require foods, clothing, shelter, safety,belonging, esteem etc. these needs exist in the very nature ofhuman beings.

Human wants are desires for specific satisfiers of these needs.For example, cloth is a needs but Raymonds suiting may bewant. Whilepeople’s needs are few, their wants are many.

Demands are wants for specific products that are backed up byan ability and willingness to buy them. Wants become demandswhen backed up by purchasing power

Need , Wants and Demand:

Products, Value, Satisfaction, Exchange and Transactions:

Products are defined as anything that can be offered to someone to satisfy a need or want.

Consumers choose among the products, a particular productthat give them maximum value and satisfaction. Value is theconsumer’s estimate of the product’s capacity to satisfy theirrequirements

Exchange is the act of obtaining a desired product fromsomeone by offering something in return. A transactioninvolves at least two thing of value, conditions that are agreedto, a time of agreement and a place of agreement

Market

Market is a place where buyers and seller together and exchangetheir goods and services for money and money worth.

A public place where buyers and sellers make transactions,directly or via intermediaries.

A market consist of all the existing and potential consumers

sharing a particular need or want who might be willing and able

toengage in exchange to satisfy that need or want

Definition:

“It is a place or area of potential exchange”

---- Phillip Kotler

Market

Importance of MarketingMarketing process brings goods and services to satisfy the needs

and wants of the people.

It helps to bring new varieties and quality goods to consumers.

By making goods available at all places, it brings equipment Distribution.

Marketing converts latent demand into effective demand.

It gives wide employment opportunities

It creates time, place and possession utilities to the products.

Efficient marketing results in lower cost of marketingandultimately lower prices to consumers.

It is vital link between production and consumption andPrimarily responsible to keep the wheel of production andconsumption constantly moving.

It creates to keep the standard of living of the society

Production ConceptProduct ConceptSelling ConceptMarketing Concept / Customer Orientation ConceptSocietal Marketing Concept

Production Concept:This is a old marketing concept till 1930’s. The main aim of theconcept is utilisation of complete orgasnasation capacity. In thisstage the management thinks that the sales department will sellwhatever the production department produces. No need of specialmarketing efforts.

This is suitable in two situations1. Where demand for a product is more than supply2. Where the cost of the production is high

Examples is hindustan motors and premier automobiles

Product Concept:This concept prevailed in between 1930-1940. the customers offersbest quality products always. So the management should improvethe product continuously.

Where the product have quality customer response is more. Hereno need of promotion activites. The main concept involved in thisis “GOOD WINE NEEDS NO BUSH”.

If the product is good and price is reasonable there is no need forspecial maketing efforts. If manufacturere adopted productconcept it is like a Blind Love.

This concept called “Marketing Myopia”(Prof. T. Levitt)

Selling Concept:Selling or sales concept. This is after 1940.

This concept said that available the best product is not enough.

Higher pressure salesmanship and heavy doses ofadvertisement are essentail to move the products in the market.

Even the best product cannot be sold out in the market with out the help of sales promotion and aggressive salesmanship.

The essence of this concept is “Goods are not bought but sold”.

This concept states that goods aare not bought but they have to be sold with the help of salesmanship, advertisment and service.

Maketing / Customer orientation:It was started in 1950’s in USA. The main aim is to satisfy the

needs, wants, desires of potentail customers.

Here the starting point is customer than product

Finding wants and needs of customer and filling them is themain aim of this concept.

Market research provides information relating to wants, needs,desires, wants, aspirations etc of the consumers.

Theme is “Organisation likes cutomer not the product”

All business operations are revolve around customersatisfaction & services under it.

Societal Oriented Concept:It is a broadest marketing concept.

It takes into considerattion not only copnsuer satisfaction butalsosocial welfare.

Social welfare speaks of polution free environemtn and qualityof human life.

Every organisation should adopt socially responsible marketingpolices and plans inorder to assure social welfare in addition toconsumer welfare.

INDIAN MARKETING ENVIRONMENT

“Surrounding which influence a particular activity” is calledEnvironment.

The market is also influenced by a number of forces which arepart of the marketing environment

Marketing Environment a force and actors thaat effect the abilityof a company to develop and maintain successful relationshipswith its target customers

The organisation which are producing a number of products,services are influenced by a group of factors which are operatingwithin and outside the organisation.

The different forces of environment provide a number ofopportunities and threats to the organisation. Hence a marketermust develop marketing mix decisions as per the changes in themarketing environment

NEED & TYPES OF MARKETING ENVIRONMENT

NEED:

Audit of environment

Assess nature of environment

Key envronment factors

Identify opportunities & Threats

Strategic Decision Making

The Marketing environment may be classified as under

Internal

External

It can be classified as

Micro

Macro

Further another classification is as under

Controllable

Uncontrollable

TYPES OF MARKETING ENVIRONMENT

TYPES OF MARKETING ENVIRONMENT

TYPES OF MARKETING ENVIRONMENT

Internal Factors

Decisins related to Product planning, branding, packing, pricing,promotional budgets etc.,(Finance, HR, Production, technology)

Other factors

1. Suppliers

2.Intermediaries

3.Customers

4.Competitors

5.Other public organisation

TYPES OF MARKETING ENVIRONMENT

External Factors

The variables of Macro Environment may be classified as

Economic Environment:

It was divided into economic conditions prevailing in a country, industrial

conditions and availability of resources for production

Demographic Environment:

It was divided based on population, city size, nationality, age, sex, education, martial status, family size, religion, family life style etc.

Indian Population 121.01 croces

Male 62.37% and Femal 58.5%

The heavy populated cities are Calcutta, Chennai, Mumai, Hyderabad, Delhi. Chandigarh

Literacy rate 74.04%

Age wise, people belong to different age groups 0-4, 5-14, 15-59, 60 plus etc.

The division of population according to education is on the basis of primary, secondary, college, post graduation and professional courses

TYPES OF MARKETING ENVIRONMENTSocia Cultural Environment:

The social environment of a country influence the value system of the country

which effects the marketing the product.

Break up of the joint family system

Women employment

Changes in the attitude towards physical fitness

Increase in the attitude towards education

Change in life style of people

Growth of consumerism

Political & Legal Environment

Marketing Decisions are also affected by the forces of political and legel

environment. The political changes may take the following forms

1. Stability of tenure of government

2. Political parties and their philosophies

TYPES OF MARKETING ENVIRONMENT

Political & Legal Environment

Essentail commodities Act 1955

Consumer protection act 1986

Environment Protection act 1986

Monopolies & Restrictive Trade Practices Act 1969

Trade & Merchandise Markets Act 1958

Drugs & Cosmetics Act and Weights & Measures Act,

Essentail Commodities act 1955

Technological environment’

This environment provides on oppotunity and a threat for thegrowth of the organisation. The factors to be considered in

1. Expenditure on research and development

2. Concentration on product improvements

3. Unlimited innovations in technology

4. Emphasis on regulaation of technological change

Importance of Environment Analysis

It helps to create a general understanding about changes in theenvironment

It guides to better planning of strategies relating to governmentand other departments

It also suggest necessary changes in allocation of scarceresources

It also helps to identify various opportunities and threats whichare posed by environment

It provides a broad and general education for managers toimplement necessary strategies

Focus on the Customer.Monitor the Competition.Own the BrandCreate New Ideas(customer acquisition campaigns, keep-in-

touch programs, new product promotions, retention efforts)Communicate Internally.Manage a Budget.Understand the ROI.Set the Strategy, Plan the Attack, and ExecuteFind & Direct Outside Vendors

S.N Selling Marketing

1 Selling starts with the seller. Marketing starts with the buyers.

2. Selling emphasizes on profit Marketing emphasizes on identification of

a market Opportunity.

3. Selling views business as a

“Goods producing processes”.

Marketing views business as a customer

satisfying process.

4. It over emphasizes the

‘exchange’ aspect

It concerns primarily with the ‘vale

satisfactions’

5. Seller’s convenience dominates

the formulation of the

‘marketing mix’.

Buyer determines the shape of the

‘marketing mix’.

S.N Selling Marketing

6. The firm makes the product

first the then decides how to

sell it and make profit.

The customer determines what is to be

offered as a ‘product’ and the firm makes a

‘total product offering’ that would match

the needs of the customers.

7. Seller’s motives dominate

marketing communications.

Marketing communications acts as the tool

for communicating the benefits/

satisfactions of the

product to the consumers

8. Costs determine price. Consumer determines price.

9. There is no coordination

among the different functions

of the total marketing task.

Emphasis is on integrated marketing

approach

10 ‘Selling’ views the customer as

the last link in the business.

‘Marketing’ views the customer as

the very purpose of the business