MM (Marketing Management)

8/8/2019 MM (Marketing Management)

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MARKETING MANAGEMENT


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Market

What is a Market?

Concept of Market Place

Market

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Basic concepts

Marketing starts with consumer needs

Concept of

Need Want

Demand

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Write down the generic need in case of the following

products

Product

Cosmetics

Elevators

Mini calculators

Soft drinks

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Concept of Product

Basic Concept

Levels of Products

Core Product

Basic Product

Expected Product

Augmented Product

Potential Product

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Market Segmentation

Dividing theheterogeneous market

intohomogeneous groupsofcustomers.

A Marketrelatesto a generic need ,

while a marketsegmentrelatesto a

want ie. a specific need. Segment islike a subset (safetyrazor)

ofa set (razor market).

Segmentsserves as a meansto goal

becausedifferent marketsdemanddifferent items.

Division ofa market into groups

having similar wants

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Why segmentation? Ithelpsus in concentrating on a

narrow marketing field (niche)tooptimizeourresourcesforthe area ,which is mostbeneficialforus.

Becauseofniche , wecan focusour

strategyon a properlydefinedspecifictargetsegmentation.

The membersofniche getting

accustomedtotheir wantsbeingmetproperlyby a particularproduct,develop a brandloyalty.

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Points to Ponder. During segmentation , what

we are grouping is anticipatedorders from buyers and notbuyers themselves and thesame buyer for different

things may belong to differentsegments .

If the difference between

products & brands is marginal, not much purpose is servedby segmentation .

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Bases for SegmentationThere are three basic motivations behind

every purchase by customer-

Benefits the productgives

The satisfaction theproduct gives

(even if the product

is not so beneficial) Buyers situation in

life

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Benefit segmentation

The Psycho graphic

segmentation ( Life-

style based )

Demographic

segmentation


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Some punch lines , used by companies to

attract the life- style based targets..

Just the change way you cook,then change the way you look

- LG Microwave Oven. Hira kah deta hai dil ki bat

- Debeers Diamonds.

Jo chaho ho jaye Coca Cola

enjoy- Coca-Cola.

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AIOInventoryActivities Sports

Shopping

Clubs Entertainme

nt

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Interests Home

Job

Food Media

Opinions Social

issues

Politics Education

Culture

Demo. Age

Income

Occupation

Education

FamilySizes


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Please suggest suitable life-styles that the marketer may

use in case of following products-

Mens clothing

Motor cycles

Soft drinks

Tea

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Demographic segmentationThis isbasedon thefollowing factors-

Family life cycle ,

Society(ie. Social class)

Age ,

Sex ,

F

amily Size , Education ,

Occupation ,

Income ,

Location , Religion ,

Race nationality.

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Family Life Cycle

(Buyers situation in life) Young single people , not living at home

Young married , no children

Young married , youngest child undersix

Young married , youngest child six or

over Older married , with dependent

children

Older married , no children living athome

Older , single

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Two more bases for segmentation-

Usage rate of a product,heavyusers of a product are identifiedeg.Young people for soft drinks

Brand loyal customers, who areused to of one brand eg.Customers for Bata shoes ,

Colgate toothpaste

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When major benefits of a

product get matured in

the same quantity in manybrands , minor benefits

may become the basis for

choice.

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Point to Ponder.


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Methodology of Segmentation

Top Down(logical division)

Bottom up(ordering division)

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Selection of segmentation

General factors

Company thirst Size & growth

Investment needed

Profitability Risk

Competition

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Selection of segmentation

Specific factors

Segmentation durability

Mobility

Visibility

Accessibility

Introduction to Marketing Chapter-1 19


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Marketing mix is a set of marketing tools that the firm uses to

pursue its marketing objective in the target market

Marketing mix options

Product price promotion place

Product variety list price sales promotion channels

Quality discounts advertising coverage

Design allowances sales force assortment

Features payment period public relations locations

Brand name credit terms direct marketing inventory

Packaging transport

SizesServices

Warranties

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Company

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PromotionMix

Product& Price

Offer

Sales Promotion

Sales Force

Advertising

Public Relations

Direct Mail / TeleMarketing

DistributionChannels TargetCustomers


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Segmentation - dividing theheterogeneous market intohomogeneous group of

customers.

Targeting - selection of a suitablecustomer group & develop amarketing plan,accordingly.

Positioning- acquiring a valuespot in the mind of a prospect ,through differentiation.

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How to make marketing efforts, strategic ?

STPApproach


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Positioning

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Targeting

Segmentation

Development of a Marketing plan /

Marketing Planning

Development ofMarketing Strategies

MarketingMix (4Ps)


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What is a marketing plan?

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Elements of a marketing plan-

Current marketing situation (Where we are)

Problems & Opportunities Marketing Objectives

Marketing Strategy

A systematic program A provision for budget


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What is a marketing strategy?

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A Marketing Strategy is a series of

integrated actions leading to a sustainable

advantage

- John Scully


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A marketing strategy is an approach to achieve

marketing objective

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The Marketing Strategy is a

decision in respect of

Target MarketPositioning

Marketing Mix

& Marketing expenditure

levels


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Sellers 4Ps corresponds to the customers

4Cs Robert Lauterborn

4Ps 4Cs

Product is based on Customers need and wants

Price

cause Cost to the customer

Place is just for Convenience of customers

Promotion is to Communicate the customers well


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A class room exercise true false

statements

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1. AMarketing Strategy is to achieve a marketingobjective.

2. Marketing Planning does not include- setting

marketing objective.

3. MarketingMix is required for marketingstrategy but not forMarketing Plan.

4. Marketing Planning comes before than

Marketing Strategy.

5. STP is an approach for strategic marketing butnot for a marketing strategy .-

6. Targeting means customizingMarketing

Planning .


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7. Marketing planning comes under marketing

strategy .

8. Features & attributes are same thing.

9 . This is more important to have attributes than

features.

10. Philp kotler has given the concept ofmarketing mix.

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Marketing organization

Marketing organization

is that where marketing

department commands the

organization by identifying

customer needs.

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Principles of designing an organisation

Dividing work force on the basis of specialization

( differentiating one activity from other) Combining inter-related specializations into one

entity ie. Department

(ie. Departmentalization)

Activities of different departments are correlatedby standardization of procedures and systems

(Ie.Formalization )

Results of activities are combined together for

decision making , at central level(Centralization )

the process of appraising the performance for

determining compensation is called evaluation

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Considerations for designing the marketing

organization

1. Organizations objectivemarket share

sales / profit levels

customer image

competitive image

2. Nature of the product

3. Flexibility at all levels for fast

changing customer preferenceproducts eg. High fashion garments.

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organizationcontd.

4. Highly diversified range of numerousproducts need separate marketingorganization for each product.

5. Such firm will need to have separate

marketing organization- If markets are located for away

from each other

- if different markets have differentcustomer taste and habits in respect ofthe same class of products.

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Methods of designing the marketing organization

Functional organization method Product management organization

method

Market centered organizationmethod

Matrix organization method (many

products many markets)

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Advertising & promotion

The long term advertising by

corporate office.

The short term advertising by

branch office.

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Marketing research

Carries out , continuously ,

a systematic objective andexhaustive search for and

study of the facts related to

any problem in the field of

marketing

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Marketing information systems (MIS)

MIS is a system of collecting , processing ,

maintaining & using information for bestdecision making.

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Principles of designing an organization

Dividing work force on the basis of specialization

( differentiating one activity from other)

Combining inter-related specializations into one

entity ie. Department

(ie. Departmentalization)

Activities of different departments are correlated

by standardization of procedures and systems(Ie.Formalization )

Results of activities are combined together for

decision making , at centrallevel

(Centralization )

the process of appraising the performance for

determining compensation is called evaluation

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Principles of designing an organisation.Contd.

Different levels body called structure. Structure helps in - facilitating achievements

- accomplishment of task

- Managerial control- reducing costs

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organization

1. Organizations objectivemarket share

sales / profit levels

customer image

competitive image

2. Nature of the product

3. Flexibility at all levels for fast

changing customer preferenceproducts eg. High fashion garments .

Marketing Planning, Strategy & Mix 40


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organizationcontd.

4. Highly diversified range of numerous productsneed separate marketing organization for each

product.

5. Such firm will need to have separate marketing

organization

- If markets are located for away from each

other

- if different markets have different customertaste and habits in respect of the same class of

products.

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Methods of designing the marketing organization

Functional organization method

Product management organization method

Market centered organization method

Matrix organization method (many products

many markets) ref. Table 3.

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CONSUMER BEHAVIOUR

Those actsofconsumersdirectly involved in

obtaining ,

using , &disposing ofeconomic goods & services,

including thedecision process..

thatprecede anddeterminethese acts.


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Input External Influences

Marketing Stimuli Other Stimuli

Product Economic

Price Technological

Promotion Political

Channel Of Social

distribution

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Process Consumer Decision Making

Buyer Characteristics Buyer Decision

Psychology ProcessPersonal and

Cultural characteristics

Output Consumer Decisions & ActionsProduct choice

Brand choice

Dealer choice

Purchase timing

Purchase amount


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Factors influencing consumer behaviour

Cultural Factors

Social Factors

Personal Factors Psychological Factors

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Psychological Factors

Motivation

Perception

Learning Beliefs & Attitudes

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MOTIVATION

.is the satisfaction which a personseeks to meet the sufficientlypressing need.

1. Physiological Need

2. Safety Need

3. Social Need

4. Esteem Need

5. Self Actualisation Need

Levels of need


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Perception

.is how we see the world around

us.Customer perceives the product by its

physical shape , colour , size , fragrance , feel,taste , packaging and advertisements.

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BELIEFS & ATTITUDES

A belief is a descriptive thought that a

person has about something

Attitude is a persons enduring feeling

towards a particular idea or object.


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OCCUPATION

is a permanent activity , provideslivelihood to a person

.. the consumer behaviour is driven

towards goods related to-

a) Specific occupation / Profession

b) Their education level


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LIFE STYLES

are patterns in which people live- as

expressed by manner in which they

spend

money &time

on various activities and interests .


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LEARNING

.is a continuous process of acquiring

knowledge from past & presentexperiences , which is applied to

evaluate future situations & decisions .


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PERSONALITY

..is sum total of an individualspsychological traits that both

determine and reflect how a personresponds to his environment stimuli.


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SOCIAL FACTORS

all individuals are surrounded by peoplewith whom they interact and such people(Reference Groups) exert a significant

influence on consumer decision makingprocess.Opinion Leaders

are those people who have developed a

reputation for acquiring considerableknowledge and experience in a particulararea.


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SOCIAL FACTORS SOCIAL GROUPS

Primary group Family and close friends

Secondary group Occasional visitors

Formal groups Who have a highly definedstructure & specific roles & goals. E.g. Office

Informal groups Which are loosely defined anddo not have specified goals. E.g. Kitty party

SOME MORE SOCIAL GROUPS


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.SOME MORE SOCIAL GROUPS

Reference groups are those which serve as a point of reference orcomparison , in the formation of the attitudes and behaviour are

called reference groups.

Indirect reference groups- are those with whom an individual doesnot have contact .e.g. Film stars , Sportsmen , Doctors etc.

Direct reference groups- are those which exert a significant

influence on purchase decision making process . Family , Friends .


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CULTURAL FACTORS-

Culture

Sub culture

Social Class


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Marketing & e-Marketing Chapter-3 58

CULTURE

is the sum total of learned beliefs , valuesand customs which guide the consumer

behavior of all members of a society.Culture comes through

Formal learning (as by children from parents)

Informal learning (copying from TV Serials)Technical learning (Painting)


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SUB CULTURE

Sub Cultures follow the dominantcultural values of the overall society

e.g.- Jainism amongst Hindus.


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SOCIAL CLASS.is created by inequality and can beranked in a hierarchal order like-

UpperUpperLowerUpperUpper middleLower middle

Upper LowerLower LowerRefer.Table 7 p.n.- 128

Detailed Model Of Factors Influencing Consumer Behaviour


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Detailed Model Of Factors Influencing Consumer Behaviour

Cultural

Culture

Sub-

Culture

SocialClass

Social

Reference

Groups

Family

Roles &Statuses

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Personal

Age & Life

Cycle

Stage

Occupation

Income

Life Style

Personality

Psychological

Motivation

Perception

Learning

Beliefs & Attitudes

BUYER


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7 OS OF CONSUMER BEHAVIOR

OccupantsObjects

Objectives

OrganizationsOperations

OccasionsOutlets


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Product Management

What is Product Management?

Role and Job of Product Manager


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Some important advanced

concepts

Product MixProduct Line

Brand Line

Brandset


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Product Mix

is a comprehensive set ofALL THE PRODUCTS,offered by one company


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Product Line

is a Group/ Line of all products , sharing common

characteristics

Product Line of bath soaps (In the ProductMix ofHLL)

Lux Liril Dove Hamam Lifebuoy


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Brand Line

is a Group/ Line of all products , sharing common

characteristics. and common brand.

Brand Line of Lifebouy brand under product line of

bath soaps

(In the ProductMix ofHLL)

Lifebouy

(Ordinary)

Lifebouy

Plus

Lifebouy

Gold


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Product Life Cycle

1. Introduction Stage

2. Growth Stage

3. Maturity Stage4. Decline Stage

TimeSale

1

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3


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A TRADE MARK

A Trade Mark is a brand , which is

registered with the competent legal

authority for obtaining rights to itsexclusive use and depriving all others

from using it under pain of legalpunishment .


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Why to build up brands

It helps a consumer in the instant

recall.(TOM)

It helps for unique identification of a productwith the added confidence of a minimumquality and attributes.

Gives the buyer a psychological satisfaction ifthe brand has a prestigious name .

Differentiate one product from other.


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Selection of Brand Name

Easy to pronounce

Unique

Association

Legally protect able by registration


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Values Associated with a

Brand Name

Memorization Value

Associational Value Repurchase Value

Descriptional Value

Motivational Value


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PACKAGING &PACKING

Packing - Covering / Wrappingthe objective

Packaging A process to

. Select the material for the

packet

designing the packet

develop the packet

wrapping the packet

Packaging and its


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Packaging and its

functions Packaging in marketing means ..

preparing goods for storages

transport

Sale

P k i


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.Science

.an Art

Packaging as.

.an instrument for impulse sale

.an technology

.a Five second commercial

Some Points to Ponder


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Some Points to Ponder

Colour scheme

Slender & cute container

Attractive graphics & logos

on container

L t l


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Long term values.. Repetitiveuse value

Ease in opening,closing andusing

packaging

Ease in disposal

Economyofstoragespace

Functionalpackages areengineering device

Packaging techniques for Sales


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g g q

promotion..

Money off pack Coupon Pack

Pack-in-premium

Premium package Self liquidator

Shelf life

Introduction of new package

Packaging designed to avoid

direct price comparison


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Trade off between Damage and

Packaging

A

Loss bydamage

( % )

Cost of Packaging ( % )

CA

Segments of packaging Industry-


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Segments of packaging Industry

Manufacturers of packaging material

Manufacturers of packages

Manufacturers of labels

Marketing Research agencies


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Pricing Strategies

Cost plus pricing

Target Return Pricing

Skimmining Pricing Loss-Leader Pricing

Penetration Pricing

Psychological Pricing


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AIDA MODEL

Awareness : On seeing an advertised item

Interest : If ad. is found attractive

Desire : If you need it

Action : Process of buying

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HIERARCHYOFEFFECTS

Movement towards

purchaseRelevant promotion

Awareness

Knowledge

Teaser campaigns, jingles and slogans

Classified ads., POP displayPublicity

Liking

Preference

Informative/descriptive ads.

Status/glamour appeals, comparative ads.

Demonstration

Conviction

Purchase

Testimonials, Coupons, Discounts & Other

incentives, POP display, Reminder ads.

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COMPARISION OF PROMOTIONAL

CO

MPO

NE

NT

SPROMOTIONAL

COMPONENT

SCOPE

Advertising Mass

Personal selling Personal

Sales promotion Mass

Publicity Mass

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CO

MPO

NE

NT

SPROMOTIONAL

COMPONENT

COST

Advertising Relatively inexpensive per contact

Personal selling Expensive per contact

Sales promotion Can be costly.

Publicity Inexpensive.

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CO

MPO

NE

NT

SPROMOTIONAL

COMPONENT

ADVANTAGES

Advertising Allows expressiveness & control over message

Personal selling Permits flexible presentation & gains immediate

response

Sales promotion Gains attention/ Immediate impact

Publicity Has high degree of credibility

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CO

MPO

NE

NT

SPROMOTIONAL

COMPONENT

DISADVANTAGES

Advertising Hard to measure results

Personal selling Costs more than all other form of contacts

Sales promotion Easy for others to imitate

Publicity Not as easily controlled as other forms

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ADVERTISING

Paid form of

non-personal presentation/ promotion of ideas byan identified sponsor.

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WHATEXACTLYADVERTISING DOES?(

O

ne point of view) Affects consumer preferences & tastes

Differentiates our product from competitors offering

Makes customers loyal &

Less price sensitive Prevents potential entrants from entering by creating

Huge brand loyalty barriers

Allows firm to charge a premium and less likely tocompete on price , dimensions etc.

High prices/ Excessive profit accrued permits moreadvertising & creating artificial shortages.

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ADVERTISING MANAGEMENT

Setting advertising objectives (Mission)

Determining advertisingBudget (Money)

Selecting & scheduling media (Media)

Developing advertising message / copy(Message)

Measuring advertising effectiveness(Measurement)

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Sales Management

Deals with different Models andMethodologies of managing sales and

distribution channels

Explores opportunities for further innovativemethods to generate sales

Deals with sales force management

Sales Promotion, Merchandising and

Inventory Control is also the part of Sales

Management

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PERSONAL SELLING

An individual to individual selling in whichoral presentation is made to customers tomake a sale.

Most expensive method of sales promotion. Indispensable due to fierce competition &

growing sophistication in buying process.

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CATEGORIES OF P.S.

Merchandise Deliveries: Sales & delivery boys.

Inside order taker: Retail salesman.

Outside order taker: Taking order from resellers.

Missionary salesperson: To educate aboutproduct & co. not for taking orders.

Tangible product seller: To persuade & sell aproduct.

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SALES PROMOTION-Techniques

Push

VsPull

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CUSTOMER RELATIONSHIPMANAGEMENT


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CUSTOMER RELATIONSHIPMANAGEMENT

INTRODUCTION TO CRM

TECHNOLOGYUSED.

OB

JECTIVES OF

CRM SOF

TWARE. PRIMARYGOALS OFCRM.

DATA COLLECTION FOR CRM

CONCLU

SION


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OBJECTIVEOFCRM

Identifying unique characteristic of each

customer.

Knowledge of customer values.

Modeling the current & potential value of

each segment.

Customization of services


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PRIMARY GOALS OFCRM

SOFTWARE

Retaining existing customer

Quick access of data within organization

Analysis of sales pattern


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Data Collection Project reports

Sample survey

Telephone directory

Registered member of Portals.

Yellow pages


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Marketing is battle amongst PERCEPTIONS

not amongst PRODUCTS

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Best of Luck for Exams

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