Marketing

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MarketingMarketing

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What is Marketing…??

Selling?

Advertising?

Promotions?

Making products available in stores?

Maintaining inventories?

All of the above, plus much more!

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Marketing

Marketing is the process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods, services to create exchanges that satisfy individual and organizational goals

American Marketing Association

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Marketing = ?

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.

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.

-Evolution of marketing

• An orientation, in the marketing context, relates to a perception or attitude a firm holds towards its product or service, essentially concerning consumers and end-users.

• Throughout history, marketing has changed considerably as consumer tastes are changing faster.

• The marketing orientation evolved from earlier orientations namely the production orientation (1950s), the product orientation (1960s) and marketing orientation (1970s).

• Recent approaches in marketing is the relationship marketing with focus on the customer, the business marketing or industrial marketing with focus on an organization or institution and the social marketing (1990s) with focus on benefits to the society.

• New forms of marketing also use the internet and are therefore called internet marketing or more generally e-marketing, online marketing, personalized marketing or one-to-one marketing.

-Product orientation and market orientation Theories

What is product orientation?

• Product orientation means that the business places the main focus of attention on the production process and the product itself. More emphasis on technology and quality, but less focus on meeting consumer needs in the market.

• Many businesses in the past were product orientated when there were quite few competitors and when they produced the unique products in the world, such as the radios when just invented.

• However, today there are still some businesses which are product orientated. For example, the Concorde airplane company (high technology, but expensive so not many customers taking their planes).


What is market orientation?

• Market orientation or consumer orientation means that the business places the needs or requirements of consumers at the center of the decision-making process.

• Market orientation is perhaps the most common orientation used in contemporary marketing. It involves a firm essentially basing its marketing plans around the marketing concept, and thus supplying products to suit new consumer tastes.

• The implication is that businesses should try best to meet the need of customers in marketing management.

• A market orientation may have some advantages over product orientation. These advantages are seen in the following table:


Some advantages of a market-orientated business over a product-orientated business:

1. More able to anticipate market changes 2. Respond quickly to market changes 3. More capable of meeting the challenges of new

competition 4. More successful in new product development 5. Able to produce to produce and sell the right product at

the right time and the right place6. …


What might a market-orientated business do in its marketing management?

1. Do market research continuously.2. Design the product according to the consumers’

needs and wants.3. Produce the product in the quantities that

consumers want to buy. 4. Set the price of the product which can be

acceptable by most consumers.5. Respond to consumer changes quickly…

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Simple Marketing System

Industry(a collection

of sellers)

Market(a collection

of Buyers)

Goods/services

Money

Communication

Information

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Marketing

Marketing is the sum of all activities that take you to a sales outlet. After that sales takes over.

Marketing is all about creating a pull, sales is all about push.

Marketing is all about managing the four P’s – product price place promotion

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The 4 Ps & 4Cs

MarketingMix

Product

Price Promotion

Place

CustomerSolution

CustomerCost

Communication

Convenience

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Difference Between - Sales & Marketing ?

Difference Between - Sales & Marketing ?

Salestrying to get the customer to want what the company produces

Marketing trying to get the company produce what the customer wants

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Scope – What do we market

Goods Services Events Experiences Personalities Place Organizations Properties Information Ideas and concepts

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The Marketing ConceptThe Marketing Concept

Key TermsKey Terms

marketing concept

customer

consumer

market

target marketing

customer profile

marketing mix

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The marketing concept states that businesses must satisfy customers' needs and wants in order to make a profit.

The Basic Concept

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Customers buy a product.

Consumers use the product.

Example: Parents who buy video games from retailers are customers. The kids who play the video games are the consumers.

Customers vs. Consumers

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A market is all potential customers who share common needs and wants and who have the ability and willingness to buy the product.

What is a Market?

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A market can be described as the people who are potential customers of a product, as well as by the classification of a product in a category. Would you be considered part of the market for game consoles? Why or why not? What other markets are you part of?

U.S. Game Console Market

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The marketing mix comprises four basic marketing strategies known as the four Ps:

The Marketing Mix

Product

Place

Price

Promotion

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Product strategies include what product to make, how to package it, what brand name to use, and what image to project.

Place strategies deal with how and where a product will be distributed.

The Marketing Mix

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Price strategies should reflect what customers are willing and able to pay.

Promotion strategies deal with how potential customers will be told about the new product, what the message will be, when and where it will be delivered, and with what inducements to buy.

The Marketing Mix

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Target marketing is focusing all marketing mix decisions on the specific group of people you want to reach.

Target Marketing

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Core Concepts of Marketing

Based on : Needs, Wants, Desires / demand

Products, Utility, Value & Satisfaction

Exchange, Transactions & Relationships

Markets, Marketing & Marketers.

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Needs, wantsdemands

Markets Marketing &Marketers

Utility, Value &Satisfaction

Xchange, TransactionRelationships

Products


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Need – food ( is a must )

Want – Pizza, Burger, French fry's ( translation of a need as per our experience )

Demand – Burger ( translation of a want as per our willingness and ability to buy )

Desire – Have a Burger in a five star hotel

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In order to understand Marketing let us begin with the Marketing Triangle

Customers

CompetitionCompany

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How Do Consumers Choose Among Products & Services?

Value - the value or benefits the customers gain from using the product versus the cost of obtaining the product.

Satisfaction - Based on a comparison of performance and expectations.

– Performance > Expectations => Satisfaction

– Performance < Expectations => Dissatisfaction

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Customers - Problem Solution

As a priority , we must bring to our customers “WHAT THEY NEED”

We must be in a position to UNDERSTAND their problems

Or in a new situation to give them a chance to AVOID the problems

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Customer looks for ValueCustomer looks for Value

Value = Benefit / Cost

Benefit = Functional Benefit + Emotional Benefit

Cost = Monetary Cost + Time Cost + Energy Cost + Psychic Cost

Marketing -Important features of marketing

Marketing has at least the following characteristics:

1. Marketing is aimed at finding out consumer needs and meeting these needs.

2. Marketing must consider profit as its main objective.

3. Marketing is ongoing all the time. The marketing process has no start or end (see next slide).

1. Businesses must be prepared to respond to the consumer reactions and changes all the time.

Figure 9-1 Ongoing Marketing Process

Analyze and design marketing strategy

Reconsidering consumer reactions

Monitor consumer reactions

Adapt the marketing strategy

Marketing -Important features of marketing

Importance of marketing

• Marketing is playing a more and more important role in the success of a business. It can be said that “no marketing means no business”.

• There are generally some key factors which have made marketing so important for businesses today. The factors can be seen as in the following table:

Table 9-1 Factors leading to the increasing importance of marketing

Factors Explain how

1. economic growth

Economic growth leads to an increase of consumers’ incomes. So demand for products and services will be increased. Through marketing, businesses can promote their new products and services.

2. fashion

Considerable changes in fashion and consumer taste force businesses to produce more new products and services. Marketing makes it possible for businesses to reach these changing customers.

3. technology New technology has helped the business to create new or high quality products. It is marketing that can makes customers be aware of these new products.

4. competition Facing more and more fierce competition, businesses must rely on marketing strategy to win in the marketplace.

--Importance of marketing

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The Marketing Plan

A written document that acts as a guidebook of marketing activities for the marketing manager

A written document that acts as a guidebook of marketing activities for the marketing manager

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CONTENTS of MARKETING PLAN CONTENTS of MARKETING PLAN Business Mission Statement

Objectives

Situation Analysis (SWOT)

Marketing Strategy Target Market Strategy

Marketing Mix Positioning Product

Promotion Price

Place – Distribution People Process

Implementation, Evaluation and Control

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The Marketing ProcessThe Marketing Process

Business Mission Stateme

nt

Objectives

Situation or SWOT Analysis

Implementation Evaluation,

Control

Target Market Strategy

Marketing Strategy

Product

Promotion

Place/Distribution

Price

Marketing Mix

Marketing Environment

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Why a product like radio declined and now once again

emerging as an entertainment medium ?

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What Were the Drivers of This Change ?

Technology ?

Government policy ?

Other media substitutes ?

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Why Market Leaders Suffered ?

HMT vs. Titan

HLL vs. Nirma

Bajaj vs. Honda

Dot.com boom, then bust and now resurgence

Market leadership today cannot be taken for granted.New and more efficient companies are able to upstage leaders in a much shorter period.

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Factors Influencing Company’s Marketing Strategy

Factors Influencing Company’s Marketing Strategy

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DemographicsDemographics

SocialChangeSocial

Change

EconomicConditionsEconomicConditions

Political & Legal FactorsPolitical &

Legal Factors

TechnologyTechnology

CompetitionCompetition

EnvironmentalScanning

EnvironmentalScanning

Target Market

ProductDistributionPromotion

Price

ProductDistributionPromotion

Price

External Environment is not controllable

External Environment is not controllable Ever-Changing

MarketplaceEver-Changing

Marketplace

External Marketing EnvironmentExternal Marketing Environment

Physical / Natural

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The macro-environmentThe macro-environment

is the assessment of the external forces that act upon the firm and its customers, that create threats & opportunities

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P r o d u c tP r o d u c tP r o d u c tP r o d u c t

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Anything that is offered to the market for

attention, acquisition, use or consumption that

satisfies a want or a need

Product is . . . . . Product is . . . . .

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Types of Products

ConsumerProducts

IndustrialProducts

PRODUCTS

Services

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Product Items, Lines, and Mixes

Product ItemProduct Item

Product LineProduct Line

Product MixProduct Mix

A specific version of a product that can be designated as a distinct offering among an organization’s products.

A specific version of a product that can be designated as a distinct offering among an organization’s products.

A group of closely-related product items.

A group of closely-related product items.

All products that an organization sells.

All products that an organization sells.

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Product Mix

Width – how many product lines a company has

Length – how many products are there in a product line

Depth – how many variants of each product exist within a product line

Consistency – how closely related the product lines are in end use

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Gillette’s Product Lines & Mix

Blades and Writingrazors Toiletries instruments Lighters

Fusion – 5 bladeMach 3 Turbo

Mach 3 Series Paper Mate CricketSensor Adorn Flair S.T. Dupont

Trac II Toni S.T. DupontAtra Right Guard

Swivel Silkience Double-Edge Soft and Dri

Lady Gillette Foamy Super Speed Dry LookTwin Injector Dry Idea

Techmatic Brush Plus

Width of the product mixWidth of the product mix

De

pth

of

the

pro

du

ct

line

sD

ep

th o

f th

e p

rod

uc

t lin

es

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What is a Service? Defining the Essence

An act or performance offered by one party to another (performances are intangible, but may involve use of physical products)

An economic activity that does not result in ownership

A process that creates benefits by facilitating a desired change in customers themselves, or their physical possessions, or intangible assets

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Some Industries - Service Sector

Banking, stock broking

Lodging

Restaurants, bars, catering

Insurance

News and entertainment

Transportation (freight and passenger)

Health care

Education

Wholesaling and retailing

Laundries, dry-cleaning

Repair and maintenanceProfessional (e.g., law,

architecture, consulting)

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Classification of Services

Pure Tangible Product

Materials / Components

Computers

Major Product withMinor Services

Product = Service

Major Service withMinor Product

Business Hotels

Good Transportation

Banking Pure Intangible Service

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Intangibility – Services are intangibility cannot be seen, tasted, felt, heard or smelled before purchase.

Inseparability - Services are produced and consumed simultaneously.

Variability or Heterogeneity – Services are highly variable

Perishability – Services cannot be stored.

Non Ownership - Services are rendered but there is no transfer of title

Major Characteristic of Services Major Characteristic of Services

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The Marketing Mix

The conventional view of the marketing mix consisted of four components (4 Ps): Product, Price, Place/ distribution and Promotion.

Generally acknowledged that this is too narrow today; now includes , Processes, Productivity [technology ]People [employees], Physical evidence

Marketers today are focused on virtually all aspects of the firm’s operations that have the potential to affect the relationship with customers.

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The “8Ps” of Integrated Service Management vs. the Traditional

“4Ps”

► Product elements

► Place, cyberspace, and time

► Process

► Productivity and quality

► People

► Promotion and education

► Physical evidence

► Price and other user outlays

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The Give and Get of Marketing

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Great Words on Marketing

1. “The purpose of a company is ‘to create a customer…The only profit center is the customer.’”

2. “A business has two—and only two—basic functions: marketing and innovation. Marketing and innovation produce results: all the rest are costs.”

3. “The aim of marketing is to make selling unnecessary.”

4. “While great devices are invented in the Laboratory, great products are invented in the Marketing department.”

5. “Marketing is too important to be left to the marketing department.”

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Drivers of Customer Satisfaction

Many aspects of the firm’s value proposition contribute to customer satisfaction:– The core product or service offered

– Support services and systems

– The technical performance of the firm

– Interaction with the firm and it employees

– The emotional connection with customers

Ability to add value and to differentiate as a firm focuses more on the top levels

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Marketers and Markets

Marketers are focused on stimulating exchanges with customers who make up markets .

The market is comprised of people who play a series of roles: decision makers, consumers, purchasers, and influencers.

It is absolutely essential that marketers have a detailed understanding of consumers, their needs and wants.

Much happens before and after the sale to affect customer satisfaction

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Stages of Customer Interaction

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What Changed in Marketing…

• Organize by product units• Focus on profitable transactions• Look primarily at financial

scorecard• Focus on shareholders• Marketing does the marketing• Build brands through advertising• Focus on customer acquisition• No customer satisfaction

measurement• Over-promise, under-deliver

• Organize by product units• Focus on profitable transactions• Look primarily at financial

scorecard• Focus on shareholders• Marketing does the marketing• Build brands through advertising• Focus on customer acquisition• No customer satisfaction

measurement• Over-promise, under-deliver

• Organize by customer segments• Focus on customer lifetime value• Look also at marketing scorecard

• Focus on stakeholders• Everyone does the marketing

• Build brands through performance• Focus on customer retention

• Measure customer satisfaction and retention rate

• Under-promise, over-deliver

Old Economy New Economy

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Graphic OrganizerGraphic Organizer

The Marketing Mix

The Marketing Concept

Consumers

Marketing Research Marketing Segmentation

Product Price Place Promotion

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Thank you

Date post:	23-Oct-2015
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