Post on 07-Apr-2018
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MARKETING MANAGEMENT
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Introduction to marketing
Social definitionA 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.
Management definition
It is the process ofplanning and executing the
conception, pricing, promotion and distribution ofideas, goods and services to create exchanges that
satisfy individual and organizational goals.
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Needs, Wants & DemandsNeeds:
A human need is a state of deprivation of some basicsatisfaction. People require food, clothing, shelter, safety,belonging & esteem. These are not created by society ormarketers. They exist in the very texture of human biology
& condition.Wants:
Desires for specific satisfiers of needs. Although needs arefew, wants are many & are continually shaped & reshapedby social forces & institutions.
Demands:
Wants for specific products that are backed by an ability &willingness to buy them. Wants become demand whensupported by purchasing power.
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What is marketed
Goods
Services
Events
Ideas Experiences
Persons
Places
Properties
Organizations Information
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Markets
Consist of all the potential customers sharing aparticular need or want who might be willing &able to engage in exchange to satisfy the need orwant.
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Marketing Concepts
The Production concept:Production marketing concept assume, that buyers want a product thatis available to them on many places, with other words they want to beeasily accessible. They also want it to be as cheap as possible. This
concept makes sense in developing countries like India, China etc. Sowe have two focuses in production concept in marketing:
1. Price
2. Availability
The Product concept:
A firm employing a product orientation is chiefly concerned with thequality of its own product. A firm would also assume that as long as itsproduct was of a high standard, people would buy and consume theproduct.
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Selling vs. Marketing concept
Selling focuses on the needs of the seller,marketing on the needs of the buyer.
Selling is preoccupied with the sellers need to
convert his product into cash, marketing with theidea of satisfying the needs of the customer bymeans of the product & the whole cluster ofthings associated with creating, delivering &
finally consuming it. Selling is push, Marketing is pull.
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Societal Marketing
Societal MarketingConcept holds that the
organizations task is to determine the needs,wants & interests of target markets & to deliverthe desired satisfactions more effectively &efficiently than competitors in a way that
preserves or enhances the consumers &societys well-being.
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Relationship marketing
The aim of Relationship Marketing is to build mutually
satisfying long term relationship with key factors in order to
earn & retain their business. These 4 key
factors/parameters are customers, employees, marketing
partners i.e. channel partners, suppliers & shareholders.
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10
Marketing Functions
ProducersProducers ConsumersConsumers
Financing
Pricing
Marketing-Information Management
Product/Service Management
Promotion
Distribution
Selling
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Marketing Mix
Set of marketing tools that the firm uses topursue its marketing objectives in the targetmarket:
1. Product
2. Price
3. Place
4. Promotion
Also known as the 4 Ps ofMarketing
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Product
Variety
Quality
Design Features
Brand name
Packaging Sizes
Warranties
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Price
List price
Discounts Allowances
Payment period
C
redit terms
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Pricing Strategies
Penetration
Skimming
Competition
PsychologicalPricing is the only mix which generates aturnover for the organisation. The remaining 3ps
are the variable cost for the organisation. It costs
to produce and design a product, it costs to
distribute a product and costs to promote it.
Price must support these elements of the mix.
Pricing is difficult and must reflect supply and
demand relationship.
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Place
Channels
Coverage Locations
Inventory
Transport
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Promotion
Sales promotion
Advertising Sales force
PR
DM
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4Ps vs. 4 Cs
Product Customer needs/wants Price Cost to customer
Place Convenience
Promotion -C
ommunication
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Factors affecting marketing environment
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(A) The micro-environment
This environment influences the organization directly. It includessuppliers that deal directly or indirectly, consumers andcustomers, and other local stakeholders. Micro tends to suggest
small, but this can be misleading. In this context, micro
describes the relationship between firms and the driving forcesthat control this relationship. It is a more local relationship, andthe firm may exercise a degree of influence.
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(B)The macro environment
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PEST Analysis
1. Political Analysis Political stability
Risk of invasion
Legal framework for contract enforcement
IPR protection Trade regulations & tariffs
Anti-trust laws
Pricing regulations
Taxation policy
Wage legislation
Mandatory employee benefits
Industrial safety regulations
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PEST Analysis
3. Social Analysis
Demographics
Class structure Education
Culture
Attitudes Leisure interests
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PEST Analysis
4. Technological Analysis
Recent techno development
Technology impact Impact on cost structure
Rate of techno diffusion (spread of technology)
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(C)The internal environment
All factors that are internal to the organization areknown as the 'internal environment'. They are generallyaudited by applying the 'Five Ms' which areMen,
Money,Machinery,Materials andMarkets. The internalenvironment is as important for managing change asthe external. As marketers we call the process ofmanaging internal change.
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Marketing Planning: The Basics for
Strategy and Tactics
Planning: Process of anticipating futureevents and conditions and of determining the
best way to achieve organizational goals
Marketing planning: Implementing planning
activities devoted to achieving marketing
objectives
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StrategicStrategic Planning versusTactical PlanningPlanning versusTactical Planning
Strategic planning: Process of determining anorganizations primary objectives and adoptingcourses action that will achieve those objectives
Tactical planning: Process that guides theimplementation of activities specified in thestrategic plan.
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Steps in the Marketing Planning
Process
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Defining theMission of the OrganizationDefining theMission of the Organization MissionMission: the essential purpose that differentiates
one company from others
The mission statement specifies the
organizations overall goals and operational scopeand provides general guidelines for futuremanagement actions
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Defining theMission of the OrganizationDefining theMission of the Organization MissionMission: the essential purpose that differentiates
one company from others
The mission statement specifies the
organizations overall goals and operational scopeand provides general guidelines for futuremanagement actions
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Determine Organizational ObjectivesDetermine Organizational Objectives An organization lays out its basic objectives, or
goals, in its mission statement
These objectives in turn guide development of
supporting marketing objectives and plans Well-developed objectives should state specific,
quantitative intentions along with deadlines forachieving them
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Assessing Organizational Resources andAssessing Organizational Resources andEvaluating Environmental Risks andEvaluating Environmental Risks and
OpportunitiesOpportunities
This step involves a back-and-forth assessment
of strengths, risks, and available opportunities.
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Formulating, Implementing, andFormulating, Implementing, and
Monitoring aMarketing StrategyMonitoring aMarketing Strategy Marketing strategy: a firms overall program for
selecting and satisfying a target market
A marketing strategy is aimed at satisfyingconsumers in the selected target market througha careful balance of the elements of the marketingmix each of which represents a subset of theoverall marketing strategy
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Formulating, Implementing, andFormulating, Implementing, and
Monitoring aMarketing StrategyMonitoring aMarketing Strategy Marketing strategy: a firms overall program for
selecting and satisfying a target market
A marketing strategy is aimed at satisfyingconsumers in the selected target market througha careful balance of the elements of the marketingmix each of which represents a subset of theoverall marketing strategy
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Porters 5 forces model
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The BCGMatrixThe BCGMatrix Market Share/Market GrowthMatrixMarket Share/Market GrowthMatrix: a
marketing planning tool that classifies a firms
SBUs or products according to industry growthrates and market shares relative to competingproducts
Stars
CashCows
Dogs
Question Marks
Methods forMarketing Planning
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BCGMarket Share/MarketGrowth Matrix
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Business Portfolio AnalysisBusiness Portfolio Analysis
Strategic Business UnitsStrategic Business Units (SBUs) are key businessunits within diversified firms
A division, product line, or single product may definean SBU
Firms redesign their SBUs as market conditionsdictate
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SBUStrategies
Build:
Objective is to increase the SBUs market share,even forgoing short-term earnings. Appropriate
for question marks whose market shares mustgrow if they are to become stars.
Hold:
Objective is to preserve SBUs market share.Appropriate for strong cash cows if they are tocontinue yielding a large positive cash flow.
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SBUStrategies
Harvest:
Objective is to increase the SBUs short-termcash flow regardless of long-term effect. Involves
a decision to eventually withdraw from abusiness by implementing a program ofcontinuous cost retrenchment.Company plansto milk its business. Hope is to reduce costs at a
faster rate than any potential drop in sales thusincreasing companys cash flow. Appropriate forweak cash cows.
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SBUStrategies
Divest:
Here the objective is to sell or liquidate thebusiness because resources can be better used
elsewhere. Appropriate for dogs & questionmarks that are dragging down companysprofits.
SBUs start as question marks, become stars, thencash cows & finally dogs.
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SWOT Analysis
S Strength
W Weakness O Opportunities
T Threats
Remember - SW are internal, OT are external
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Ansoffs Product-Market Grid
Current products New products
Current Mkts
New Mkts
Mkt penetrationstrategy
Mkt development
strategy
Product developmentstrategy
Diversification
strategy
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Porters Generic Strategies
Overall cost leadership
Product Differentiator
Focus
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