Marketing ManagementMarketing Management

The scope of MarketingThe scope of Marketing What is Marketing?What is Marketing?1. “…meeting needs profitably!”1. “…meeting needs profitably!”2. “Marketing is an organizational function and a set 2. “Marketing is an organizational function and a set

of processes for creating, communicating and of processes for creating, communicating and delivering value to customers and managing delivering value to customers and managing customer relationships in ways that benefits customer relationships in ways that benefits organization and its stake holders.”organization and its stake holders.”

3. “Marketing is a societal process by which 3. “Marketing is a societal process by which individuals and groups obtain what they need and individuals and groups obtain what they need and want through creating offering and freely want through creating offering and freely exchanging products and services of value with exchanging products and services of value with others.”others.”

4. “Marketing deals with identifying and meeting 4. “Marketing deals with identifying and meeting human and social needs”human and social needs”

The scope of MarketingThe scope of Marketing

Exchange and transactionExchange and transaction A person can obtain a product in one A person can obtain a product in one

of four waysof four ways• Self-produceSelf-produce• Use forceUse force• BegBeg• ExchangeExchange

The scope of MarketingThe scope of Marketing Exchange and transactionsExchange and transactions Exchange: The process of obtaining a desired product Exchange: The process of obtaining a desired product

from someone by offering something in return.from someone by offering something in return. Transaction: A trade of values between two or more Transaction: A trade of values between two or more

parties. When an agreement is reached we say parties. When an agreement is reached we say transaction has happened.transaction has happened.

For exchange potential five conditions must be For exchange potential five conditions must be satisfiedsatisfied

1.1. There are at least two partiesThere are at least two parties

2.2. Each party has something that might be of value to the other Each party has something that might be of value to the other partyparty

3.3. Each party is capable of communication and deliveryEach party is capable of communication and delivery

4.4. Each party is free to accept or reject the exchange offerEach party is free to accept or reject the exchange offer

5.5. Each party believes it is appropriate or desirable to deal with Each party believes it is appropriate or desirable to deal with the other partythe other party

The scope of MarketingThe scope of Marketing

A transaction involvesA transaction involves• At least two things of valueAt least two things of value• Agreed upon conditionsAgreed upon conditions• A time of agreementA time of agreement• A place of agreementA place of agreement

A legal system supports and enforces A legal system supports and enforces compliancecompliance

TransferTransfer

In transfer A gives X to B but does In transfer A gives X to B but does not receive any thing tangible in not receive any thing tangible in returnreturn• Gifts, subsidies, charityGifts, subsidies, charity• Transfer expects something like Transfer expects something like

gratitude, changed behaviour, Thank-gratitude, changed behaviour, Thank-you notes, invitations, a business firm you notes, invitations, a business firm wants a purchase, a politician wants wants a purchase, a politician wants vote, vote,

What each party expectsWhat each party expects

Mahindra and Mahindra sales a tracterMahindra and Mahindra sales a tracter• Farmer wants:Farmer wants:

High quality equipmentHigh quality equipment A fair priceA fair price Timely deliveryTimely delivery Good financial termsGood financial terms Reliable parts and serviceReliable parts and service

• Mahindra and Mahindra wantsMahindra and Mahindra wants Good price for the tracterGood price for the tracter On-time paymentOn-time payment Positive word of mouthPositive word of mouth

The scope of MarketingThe scope of Marketing

What is Marketed?What is Marketed?1.1. Goods Goods

2.2. ServicesServices

3.3. EventsEvents

4.4. ExperiencesExperiences

5.5. PersonsPersons

6.6. PlacesPlaces

7.7. PropertiesProperties

8.8. OrganisationsOrganisations

9.9. InformationInformation

10.10. Ideas Ideas

Cars, Trucks, Televisions, Machine Tools, Machines, Industrial chemicals, watches, cosmetics …….Airlines, Hotels, Car rental, barbers, beauticians, maintenance and repair, accountants, lawyers, doctors, consultants, service providers …… Trades shows, Artistic performances, Sporting events (Olympics, World Cup), Amusement park, water park, Multiplexes

Celebrity marketing, Stars selling themselves through agents, PR agencies etc.State ads like tourist or business destinations

Real Estate or financial property like stocks and bondsCompanies, Corporate, Universities …..

News channels, Encyclopedias ….Awareness about AIDS, Family planning, Discouraging smoking ….

The scope of MarketingThe scope of Marketing

Who Markets?Who Markets?A marketer is someone who seeks response from another party called A marketer is someone who seeks response from another party called

prospect,prospect,

Eight demand states:Eight demand states:1.1. Negative DemandNegative Demand

2.2. Nonexistent DemandNonexistent Demand

3.3. Latent DemandLatent Demand

4.4. Declining DemandDeclining Demand

5.5. Irregular DemandIrregular Demand

6.6. Full DemandFull Demand

7.7. Overfull DemandOverfull Demand

8.8. Unwholesome DemandUnwholesome Demand

MarketsMarkets

Collection of buyers and sellers who Collection of buyers and sellers who transact over a particular product or transact over a particular product or product class (e.g. the housing product class (e.g. the housing market or grain market)market or grain market)

Sellers: Constituting industrySellers: Constituting industry Buyers: Constituting marketsBuyers: Constituting markets

Market

MarketsMarkets

GovernmentMarkets

IntermediaryMarkets

ManufacturerMarkets

ConsumerMarkets

Resource Markets

ResourcesResources

Goods & Services Goods & Services

MoneyMoney

Money Money

ServicesMoney

ServicesMoney

ServicesMoney

Services

Taxes,Goods

Taxes,Goods

Taxes

Taxes,Goods

Key customer marketsKey customer markets

Consumer marketsConsumer markets Business marketsBusiness markets Global marketsGlobal markets Non-profit and Govt MarketsNon-profit and Govt Markets

Industry(Collection of sellers)

Market(collection of buyers)

Communication

Goods/ Services

Money

Information

Marketplaces, Marketspaces and MetamarketsMarketplaces, Marketspaces and Metamarkets

•Marketplace: is physicalas you shop a store

•Marketspace: is digitalas you shop on Internet

•Metamarket: is a cluster of complementory productsand services that are closely related in the minds of consumers but are spread across a diverse set of Industries

Automobile metamarket: Automobile Manufactures

New car Dealers

Used car Dealers

Financing Companies

Insurance companies

MechanicsSpare part dealers

Service shops

Auto magazines

Classified Auto ads in newspapersInternet sites on Auto

The scope of MarketingThe scope of Marketing

How business and Marketing are How business and Marketing are changing?changing?

Changing TechnologyGlobalizationDeregulationsPrivatizationCustomer empowermentCustomizationHeighten competitionIndustry convergenceRetail transformationDisintermediation

Company orientation/ PhilosophiesCompany orientation/ Philosophies•The Production Concept

•The Product Concept

•The Selling concept

•The Marketing Concept

•The Holistic Marketing Concept

High production efficiency, Low cost and mass distribution

Total focus on product and no focus on other needs

Intention is to sell more and more

No HUNTING but GARDENING,Understanding EXPRESSED needs Reactive Market Orientation)Understanding LATENT needs (Proactive Market Orientation)And TOTAL Market Orientation

Relationship MarketingIntegrated MarketingInternal MarketingSocial Responsibility Marketing

Company orientationCompany orientation

Internal Marketing

Integrated Marketing

SociallyResponsibleMarketing

RelationshipMarketing

HolisticMarketing

Marketing Department

SeniorManagement

Other Departments

Ethics

Environment LegalCommunity

Customers

Channel

Partners

Communications Products & Services Channels

Relationship MarketingRelationship Marketing Has a aim of building mutually satisfying long term Has a aim of building mutually satisfying long term

relationships with key parties- Customers, Suppliers, relationships with key parties- Customers, Suppliers, Distributors and Other marketing partners- in order to earn Distributors and Other marketing partners- in order to earn and retain their business.and retain their business.

Marketing must not only do ‘customer relationship Marketing must not only do ‘customer relationship management’ (CRM) but also ‘partner relationship management’ (CRM) but also ‘partner relationship management’ (PRM)management’ (PRM)

Key constituents areKey constituents are• CustomersCustomers• EmployeesEmployees• Marketing partners (channels, suppliers, distributors, Marketing partners (channels, suppliers, distributors,

dealers, agencies)dealers, agencies)• Members of financial community (shareholders, Members of financial community (shareholders,

investors, analysts)investors, analysts) Ultimate outcome is a Marketing NetworkUltimate outcome is a Marketing Network

Integrated MarketingIntegrated MarketingMarketing MixMarketing Mix

Marketing Mix

Target Market

ProductsProduct varietyQualityDesignFeaturesBrand namePackagingSizesServicesWarrantiesReturns

PlaceChannelsCoverageAssortmentsLocationsInventoryTransport

PriceList priceDiscountsAllowancesPayment periodCredit terms

PromotionSales promotionAdvertisingSales forcePublic relationsDirect Marketing

Integrated MarketingIntegrated MarketingMarketing MixMarketing Mix

Four P’sFour P’s Four C’sFour C’s

ProductProduct Customer solutionCustomer solution

PricePrice Customer costCustomer cost

PlacePlace ConvenienceConvenience

PromotionPromotion CommunicationCommunication

Internal MarketingInternal MarketingMarketing must be embraced by the other departmentsMarketing must be embraced by the other departments

Social Responsibility MarketingSocial Responsibility MarketingIncorporates social responsibility and understands broader Incorporates social responsibility and understands broader concerns and the ethical, environmental, legal and social concerns and the ethical, environmental, legal and social

context.context.

Fundamental Marketing Concepts:Fundamental Marketing Concepts:

Core concepts:Core concepts:• Needs, wants and DemandsNeeds, wants and Demands• Target Markets, Positioning and Segmentation Target Markets, Positioning and Segmentation

(STP)(STP)• Offerings and BrandsOfferings and Brands• Value and satisfactionValue and satisfaction• Marketing channelsMarketing channels• Supply chainSupply chain• CompetitionCompetition• Marketing EnvironmentMarketing Environment• Marketing planningMarketing planning

1. Stated needs2. Real needs3. Unstated needs4. Delight needs5. Secret needs

1. Divide market into segments2. Profile distinct groups using

demographic, psychographic and behavioral differences

3. Decide segment with greatest opportunity

4. For chosen target market develop offering

A brand is an offering from a Known sourceValue reflects the perceived tangible and intangible benefits and costs to customers. Value can be seen as a combination of Quality, Service and

Price

1. Communication channels2. Distribution channels3. Service channels

Supply channel describes a longer channel from

Raw material toComponents toFinal products

Supply chain represents Value delivery system

Competition includes all the actual and potential rival offerings and substitutes that a buyer might

consider

Marketing Environment:1. Task Environment

CompanySuppliersDistributorsDealersTarget Customers

1. Broad EnvironmentDemographicEconomicPhysicalTechnologicalPolitical-legalSocial-cultural

Marketing PlanningAnalysing Marketing opportunitiesSelecting target marketDesigning marketing strategiesDeveloping marketing programmesManaging marketing efforts

Factors Influencing company Marketing StrategyFactors Influencing company Marketing Strategy

Target customers

Product

Pri

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Pla

ce

Promotion

Demographic/ economic

environment

Technological/ physical

environment

Social/Cultural

environment

Political/Legal

environment

Marketingintermediaries

PublicsSuppliers

Competitions

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Future of MarketingFuture of Marketing From Marketing does the marketing to everyone does the From Marketing does the marketing to everyone does the

MarketingMarketing From organizing by product units to organising by customer From organizing by product units to organising by customer

segmentssegments From making everything to buying more goods and services From making everything to buying more goods and services

from outsidefrom outside From using many suppliers to working with fewer suppliers From using many suppliers to working with fewer suppliers

in a ‘partnership’in a ‘partnership’ From relying on old market positions to uncovering new From relying on old market positions to uncovering new

onesones From emphasizing tangible assets to emphasizing From emphasizing tangible assets to emphasizing

intangible assetsintangible assets From building brands through advertising to building brands From building brands through advertising to building brands

through performance and integrated communicationsthrough performance and integrated communications

Future of MarketingFuture of Marketing From attracting customers through stores and salespeople From attracting customers through stores and salespeople

to making products available onlineto making products available online From selling to everything to trying to be the best firm From selling to everything to trying to be the best firm

serving well defined target marketsserving well defined target markets From focusing on profitable transactions to focusing on From focusing on profitable transactions to focusing on

customer lifetime valuecustomer lifetime value From a focus on gaining market share to a focus on building From a focus on gaining market share to a focus on building

customer sharecustomer share From being local to being ‘glocal’- both local and localFrom being local to being ‘glocal’- both local and local From focusing on the financial scorecard to focusing on the From focusing on the financial scorecard to focusing on the

marketing scorecardmarketing scorecard From focusing on shareholders to focusing on stakeholdersFrom focusing on shareholders to focusing on stakeholders