DEFINITION OF MARKETING

“The process of planning and executing the conception, pricing, promotion and distribution of ideas, goods, and services to create exchanges that satisfy individual and organizational objectives.”

Importance of Marketing

• Marketing Promotes Product Awareness to the Public

• Marketing Helps Boost Product Sales

Importance of Marketing

Importance of Marketing

• Marketing Builds Company Reputation

What is Marketed?

• Goods

• Services

• Events

• Experiences• Persons

• Places

• Properties

• Organizations

• Information• Ideas

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The 4 Ps of Marketing

CoreMarketingConcepts

ProductConcept

PriceConcept

PromotionConcept

PlaceConcept

Product Mix

What is product-mix ?• Set of all product offered for sale by a company.• It consist of various product lines.• Any company’s product mix has four dimension : 1. Width 2. Length 3. Depth 4. Consistency

• Width : Number of different product lines carries by the company

• Length : Total number of items in the product mix of the company.

• Depth : Assortment of size, colour and models offered in each item of a product line.

• Consistency : It refers to the relationship of various product line either in their end use, production requirement, distribution channel or other way.

Factors affecting choice of Product Mix

• Business Objectives of the Company• Market Situation• Competitors’ Actions• Production Facilities:

– If the Plant and Machinery allow for a specific treatment of the wastes created by making another product, that recycled product can be incorporated in the product mix. For eg.- Bagasse paper by Classmate (ITC).

Branding

• A brand is name, term, sign, symbol, or a combination of them, intended to identify the goods and services of one seller or group of sellers and to differentiate them from those of competition.

• Threes of Cs of Branding:– Clarity- Strong bands are clear about what they

are & what they are not.– Consistency –They are always what they say

they are.– Constancy- They are always there for their

customers and prospects.

Packaging and Labelling

• Packaging is the technology of enclosing or protecting products for distribution, storage, sale, and use. Packaging also refers to the process of design, evaluation, and production of packages. Packaging can be described as a coordinated system of preparing goods for transport, warehousing, logistics, sale, and end use.

• Labelling is the process of incorporating any written, electronic, or graphic communications on the package or on a separate but associated label.

• Purposes of Packaging:– Product Protection.– Product

Attractiveness.– Product Identification.– Product

Convenience.– Effective Sales Tools.– Channel Co

operation.– Segmentation.

• Purposes of Labelling:– Clear Instruction.

– Price verification.– Check

Standards/Quality– Maintain

manufacturer-buyer relation.

• Important decision related to physical distribution of goods and services.

• Make product available.• Channels of Distribution:

It refers to people or middlemen who help in distributing of the goods.

• Without these middlemen its impossible for producer to make goods available to customers.

• Some Examples of middle men : whole seller, retailer etc…

Types of Distribution Channel:

• Direct: In this type of channel goods/products are sold by

producer directly to consumer.• Indirect: Here goods are sold with help of middle men.

Types of Indirect Channel:1. One level2. Two level3. Three level

Product Related Factors:

• Value : Price is an essential component, if it is costly companies generally should follow Direct or one level channel of distribution.

• Complexities: If product is complex, and requires high level of technical knowledge then direct level should be used.

• Nature: Customised product requires direct channel. Standard product can be sold by indirect channel.

• Perishable products require direct channel, while non perishable requires indirect channel.

Company Related Factors:

• Finance: If company is financially sound then only they should try direct channel. If company is financially unsound they should try indirect channel.

• Degree of Control: If company wants control over the selling and price of its product then, they should go for Direct Channel.

Competitive Factor:

• The type of channel selected by competitor companies affects the selection of channel. As a company we may select the same channel as selected by competitor or sometimes the businessmen prefers not to select the channel selected by competitor. For example: if competitor has chosen to sell detergent using direct channel, businessmen can choose to sell it using indirect channel.

Market Related Factors:

• Nature of market: In Industrial market direct selling is preferred. Whereas in consumer market distribution channels are appointed.

• Size of the market: Large number of consumers require indirect channel, but if number of consumers are less direct channel is preferable.

• Geographical : When buyers are concentrated in limited area direct selling is preferred.

• Quantity Purchased: If order size is large then direct supply from firm is preferred.

Environmental Factors:

• Other factors which affects this decision include environmental factors such as trade policy, economic policy etc…

• During Boom period indirect channel is used.

• During period of recession direct channel is used to make goods delivered to consumers in economical way.

No Product can be launched without a price. Level of price affects the demand for a Product. Generally, lower the price, higher would be the demand for the product and vice versa.Price is an Important factor affecting the success or failure of a product in the market. It is the single most important factor affecting the revenues and profits of the firm.

Price is defined as the Amount of Money paid by a buyer (or received by a seller) in consideration of the purchase of a product or a service.

For Example: Money paid to buy a pen or fare of metro etc.

• Setting the Pricing Objectives (profit maximisation, surviving competition etc.)

• Determining the Pricing Strategies (market penetration pricing strategy or market skimming pricing strategy)

• Analysing the Factors Determining the Price (product cost, competition etc.)

• Fixing a Price for the Firm’s Products

• Discount to Customers, Credit terms, etc.

Pricing Objectives: Profit maximisation, surviving competition, attaining product quality leadership or market share leadership.

Product Cost: Price should atleast recover total costs in the long run.

Extent of Competition in the Market: Price of Product and extent of Competition in the market are inversely related.

Utility and Demand: Utility provided by the product and intensity of demand of the buyer set the upper limit of price, which the customer will be willing to pay.

Government and Legal Regulations: Firm should not charge a higher price, otherwise government intervenes to protect the interests of public.

Marketing Methods Used: Price of the Product is also affected by the distribution channels used, quality of advertising and salesmen employed etc.

PROMOTION

PROMOTION MIX The promotional activities aims at informing and persuading customers to

buy the products and informing him about the merits of products. Promotion mix refers to all the decisions related to promotion of sales 0of

product and services.

The elements of promotion are as follows

Advertising

Sales promotion

Personal selling

Publicity

Public relations

ADVERTISINGAdvertising can be defined as paid form iof non personal presentation and

promotion of ideas, goods and services by an identified sponsorer.

Developing an effective advertisement program involves setting the advertisement objectives,deciding on advertising budget,designing the message ,deciding on media,and evaluating the advertisuing effectiveness.

Advertising has many benifits such as wide reach, variety of media availible for advertising(video, audio,visual audio,print media),legitamacy is there, expessiveness with help of drawings ,colours,pictures etc,customer satisfaction is enhanced,and it is economical as compared to other promotional techniques.

Advertising can be done through various mediums such as telivision,radio, magazines ,newspaper,internet,billboards,posters etc.

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OBJECTIONS TO ADVERTISING

•Advertising has been subject to criticisms raised by a group of people.Some of these objections and thier answers are as follows

Effects of advertising on values materiaslism and lifestyles•objections – promotes materialism.inform and induce customers to buy more new products which they do not require.BUT advertisements increases knowledge of customers ,informing them about various products along with their utilities.

Advertising encourage sales of inferior and dubious products•objections -they show all types of products irrespective of their qualities and encourage sale of inferior products.BUT what is inferior depends on economic status and preference.But it is right that it encourage sale of duplicate products.

Advertising confuses rather than helps•objections -the number of advetrtisement increasing day by day. Claims made by different companies confuses the customers.BUT advertisements give wide choice to customers and customers are smart enough to select most suitable brand.

Advertisement costs are passed to customers in form of higher price•objections -advertising costsa are passed to customers in form of higer price.BUT advertising increases demand of product which inceases sale and also production . Hence firms get advantage of economies of scale.

SALES PROMOTION

Sales promotion comprises of a wide variety of tactical promotional tools designed to stimulate earlier or stronger target market response.Sales promotional tools makes three contributions-

COMMUNICATION-gains attention and provide information which leads ti trying it.

INCENTIVE-they incooperate some concessions,inducement that is designedto represent value to reciever.

INVITATION-include distinct invitation to involve in transaction now.

PROMOTIONAL TECHNIQUES FOR CUSTOMERS

•Some of the techniques of sale promotion are

REBATE-selling the product for special price less than original price .

DISCOUNTS-reduction of certain percentage of price from list price.

REFUNDS-refers to refund a part of price on presentatrion of proof of purchase.

PREMIUMS OR PRODUCT COMBINATIONS-giving a free gift6 on purchase of product.

QUANTITY DEALS-extra quantity in special package at less price on extra purchase of some quantity free.

SAMPLES- distribution of free sample of products to customers.

CONTESTS- participaton of consumers in competitive events organised by firms and winners are given rewards.

INSTANT DRAWS AND ASSIGNED GIFTS-it includes offerslike scrach a card and win instantly a refrigerator,car etc.

PACKAGED PREMIUM-free gifts are kept inside packs.

CONTAINER PREMIUM-special containers to pack products which could be reused by consumers.

PUBLICITY

Publicity is a non paid form of communication by unidentified sponsorer.

It is more credible as it is given by an independent source like news ,press etc

It has mass reach as people give more importance to news.

It has certain limitations such as-

No control by firms.

In publicity limited information is given.

PERSONAL SELLING

•Personal selling means face to face interaction between seller and buyer for purpose of sale.the concept is based on customer satisfaction.it has some advantages which are-

PERSONAL INTERACTION

TWO WAY COMMUNICATION

BETTER RESPONSE FROM CUSTOMER

FRIENDLY RELATION BETWEEN SELLER AND CUSTOMER

BETTER CONVINCING

EFFECTIVE WAY TO INTRODUCE NEW PRODUCT

MINIMUM WASTAGE OF EFFORTS

Importance to customers

HELPS IN IDENTIFYING NEEDS

ENABLE THEM TO GET LATEST MARKET INFORMATION

CUSTOMERS CAN GET EXPERT ADVISE AND GUIDANCE

PUBLIC RELATIONS

Public relations means maintaining public relations with public. By maintaining public relations ,companies create goodwill.

Public relations evaluate public attitude ,identifies the policies and procedures of organisation with public interest to earn public understanding and acceptance.

Other than customers it includes suppliers, shareholders, intermediaries etc.

It can make a memorable impact on public awareness.

It developes executes and evaluates a program to urn public understanding and acceptance.

It has several advantages like

It helps to convey policies and programs of organisation.

Helps to collect public opinion about organisation , management activities etc.

To overcome complaints and dislikes of public.

To mould people attituide in favour of organisation.

Methods and tools of public relations

NEWS -getting involved in such activities that give positve coverage in news.ex -reservation of jobs for women.

SPEECHES-by leaders of cooperate sector influence banks,shareholders etc.

EVENTS- organising press conference,matches stage shows or multimedia presentation.

WRITTEN MATERIALS- such as balance sheets, annual reports ,brochers are circulated to various parties to improve public image of company.

PUBLIC SERVICE ACTIVITIES-big business houses associate themselves with social service projects such as women welfare programs,chairity shows,up keeping of parks, running schools ,colleges and hospitals etc.

Examples of effective promotion

A good example is coca cola entreprises which offer discount and promotinal deals such as My coke rewards offer free products and services by redeeming collected points.They increase their sales by putting a code inside packaging for consumers to redeem online.

Tata tea had launched a much 'Jaago Re ' campaign which brings common and unique message of social awakening which has earned it success.

Dabur always promoted itself on health platform.taking Amitabh Bachchan as brand ambassador and the brand core message of' Andhrooni shakti 'has helped it to become more popular.It wanted its customers to see product as readily availible household health supplement.

Hence promotion is very important element of marketing mix.

• Social Marketing applies the principles of marketing to address social problems by influencing behavior change.

• Social marketing requires:A “customer” focused approachVoluntary behavior changeAn exchange Individual or societal benefit (rather than

corporate benefit or profit)

Social Marketing

Some examples of social

marketing

It is audience focused.It segments audience.It is outcome focused.It relies on exchange.It addresses barriers.

Features OF SOCIAL MARKETING:

Define Problem: Know what you want to do and why (your expertise is key)

Market Research: Understand your audience: barriers, motivators, etc.

Planning: Determine best way to reach audiences and to achieve goals

Implementation: Make it happen Evaluation: Define and measure successes

5 Stages of Social Marketing

Public sector bodies can use standard marketing approaches to improve the promotion of their relevant services and organizational aims but it should not be confused with social marketing .

Eg. A three month marketing campaign to encourage people to get H1N1 vaccine is more tactical in nature and should not be considered social marketing whereas a campaign that promotes and reminds people to get regular checkups and all of their vaccines when they are supposed to encourage a long term behaviour change that benefits society ,it can therefore be considered social marketing .

Examples of social marketing