1INTRODUCTION Meaning & Core Concept Mktg Philosophy

8/12/2019 1INTRODUCTION Meaning & Core Concept Mktg Philosophy

1/30

MEANING AND CORE CONCEPT OF MARKETING.

AIM OF MARKETING IS TO BUILD AND MANAGE PROFITABLECUSTOMER RELATIONSHIP.

What is marketing?

Marketing is the delivery of customer satisfaction at aprofit.

Two fold goal of marketing isto attract new customer by promising superior value

and

to keep and grow current customers by deliveringsatisfaction.

Marketing is all around you and us.

KD-POMKTG 1


2/30

Marketing defined

Marketing is more than just selling and advertising, itis a process of satisfying customer needs.

Marketing is a social and managerial process whereby

individuals and groups obtain what they need andwant through creating and exchanging products andvalue with others.

KD-POMKTG 2


3/30

Continue. Human activity directed at satisfying needs and wants

through exchange processes - Philip Kotler

Marketing is the performance of business activities thatdirect the flow of goods and services from producer to

consumer or user Marketing is 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 . - The AmericanMarketing Association.

KD-POMKTG 3


4/30

Needs, wants, and demands

Need - Human needs are states of felt deprivation. Eg real needs, hiddenneeds , psychological needs , social needs etc.

Want - Wants are the form taken by a human need as shaped by cultureand individual personality, different persons may have different wants

to satisfy the same need eg , a person needs water to satisfy his thirst,some demands cold drinks, some demands ice-creams etc.

Demand - Human wants that are backed by buying power.

The management of good companies always remain close to customers

through various ways.

Understanding customer needs, wants, and demands in detail providesimportant input for designing marketing strategies.

KD-POMKTG 4


5/30

Marketing offers Products, Services and Experiences

People satisfy their needs and wants with products and services.

Product Anything that can be offered to a market for attention, acquisition,use or consumption that might satisfy a want or need. It includes physicalobjects, services, persons, places, organization and ideas.

Service Any activity or benefit that one party can offer to another that is

essentially intangible and does not result in the ownership of anything.

Offerings set of benefits proposed by the marketer to the customers to buyor consume ,may includes products , services ,information and experiences .

The term product includes more than just the physical properties of goods and

services, it also includes the meaning of brands to the customer andexperiences associated with it.

KD-POMKTG 5


6/30

Value, Satisfaction and Quality

Customer value - Customer value is the difference between the values thecustomer gains from owning and using a product and the costs ofobtaining the product.

Customer satisfaction The extent to which a products perceivedperformance in delivering value matches a buyers expectations.

Performance < Expectation = DissatisfactionPerformance = Expectation = SatisfactionPerformance > Expectation = Delight.

QualityNarrow sense Freedom from defectIn broader sense Quality is the characteristics of a product or service

that bear on its ability to satisfy stated or implied customer needs.

Total Quality Management (TQM) is an approach in which all the companys peopleare involved constantly improving the quality of products, services and businessprocesses.

KD-POMKTG 6


7/30

Exchange, Transaction, and Relationship

Exchange The act of obtaining a desired object from

someone by offering something in return.

Transaction A trade between two parties thatinvolves at least two things of value, agreed-upon

conditions, a time of agreement, and a place ofagreement.

Barter and Monetary transaction.

KD-POMKTG 7


8/30

Relationship marketing The process of creatingmaintaining, and enhancing strong, value-laden

relationships with customers and other stakeholders.

Marketers need to build long-term relationshipswith valued customers, distributors, dealers, andsuppliers. In fact a company wants to build aunique company assets called a marketingnetwork.

marketing network consists of the company and all its supporting

stakeholders: customers, employees, suppliers, distributors, retailers,ad agencies and others with whom it has built mutually profitablebusiness relationships.

KD-POMKTG 8


9/30

Markets

The set of all actual and potential buyers of a productor service.

Originally the place where buyers and sellers

gathered to exchange goods or services.Economistscollection of buyers & sellers whotransact in a particular product class.Marketers- the sellers as constituting an industry

and the buyers as constituting a markets.

KD-POMKTG 9


10/30

SEGMENTATION , TARGET MARKETS AND

POSITIONING SEGMENTATION : process of dividing a large heterogeneous market

into the smaller and specialized market segments , whose responsediffer from one another .

TARGET MARKETS : those groups of people whom the firm wants toserve or wants to design product or services to meet their needs andwants .

POSITIONING : an act of creating demand or image in the customersmind for the product offered for sale .

KD-POMKTG 10


11/30

MARKETING CHANNELS

Communication channels : routes or medias thatdeliver or convey desired messages from marketer tocustomer.

Distribution channels : routes or marketing

intermediaries used for distributing manufacturedproducts from producer to final customers.

SUPPLY CHAIN : longer channels stretching from rawmaterials to components to final products that are

carried to final users.

KD-POMKTG 11


12/30

Marketing

Marketingmeans managing markets to bring about

exchanges and relationships for the purpose ofcreating value and satisfying needs and wants.

Marketingas a process by which individuals andgroups obtain what they need and want by creatingand exchanging products and value with others.

Marketing involves serving a market of end users in the face ofcompetitors.

The company and the competitors send their respectiveproducts and messages to consumer through directly or through

marketing intermediaries to end users. All the players in this system are affected by major

environmental forces (demographic, economic, physical,technological, political, legal, social, cultural).

KD-POMKTG 12


13/30

MARKETING MANAGEMENT CONCEPT

Marketing Management is the analysis, planning, implementation, and

control of programs designed to create, build, and maintain beneficialexchanges with target buyers for the purpose of achieving organizationalobjectives.

Philip Kotler defines marketing management as the process of planning,

implementing and controlling marketing activities or practices to achievethe desired organizational goal

Marketing management involves managing demand and customerrelationships.

KD-POMKTG 13


14/30

HISTORICAL DEVELOPMENT OF MARKETING THE STAGE OF SELF SUFFICIENCY : people used to work to satisfy their needs

THE STAGE OF PRIMITIVE COMMUNISM : traditional division of labor appeared among familieseg some families were supposed to do farming, some hunting etc.

THE STAGE OF SIMPLE BARTER : techniques were developed to satisfy the diverse requirementthrough exchange of goods among families

THE STAGE OF LOCAL MARKETS : temporary local markets and eventually small permanentshops were built

THE STAGE OF MONEY MARKET : it helped in developing division of labor , productspecialization and marketing activities in a systematic way .

THE STAGE OF EARLY CAPATALISM : two classes of people appeared at this stage , Capitalistclass and Labor class . Capitalist used to invest money in the business for production of goods andemploy labor classes, the marketing started developing .

THE STAGE OF MASS PRODUCTION : during the period of industrial revolution in Europe [17701820 A.D.] , it changed social and economic life of people and helped innovate the modernconcept of marketing.

THE STAGE OF INTERNATIONALISM : after the world war II , a three tired change took place inthe world : a) countries divided into two ideological blocks , capitalists and communists ,as suchtrade barriers increased in the world , b) huge programs of assistance appeared to rebuild the warravaged world and create new markets , and

A ray of international cooperation appeared in the world history of commerce . As a result severalinternational organizations like GATT , IMF ,WORLD BANK and UNCTAD established tofacilitate the mechanics of trade and economic shape of the world .

THE STAGE OF GLOBALIZATION : it covers trade in goods and services , IPR and investments.KD-POMKTG 14


15/30

DEMAND MANAGEMENTA situation may exist at any point of time when thereis no demand, adequate demand, irregular demand,

or too much demand and marketing managementshould address these entire situations and achieveorganizational objective.

Marketing Mgmt. is not all about creating moredemand but to manage demand.

De marketing: Marketing to reduce demand

temporarily or permanently The aim is not todestroy demand but only to reduce or shift it , egbajaj shifts its customer from scooter to bikes.

KD-POMKTG 15


16/30

BUILDING PROFITABLE CUSTOMERRELATIONSHIP

Managing Demand means managing customer.

Customers New and Repeat.

Traditional approach is to attract more new

customer but it is shifted more to retain existingcustomer and build lasting customer relationship.

Attracting new customer is more costly than to keep

current customer satisfied. Losing current customermeans losing not only sales but the value ofpurchases and referrals.

KD-POMKTG 16


17/30

MARKETING MANAGEMENT CYCLE

Marketing management functions are analysis, planning,Implementation, and control.

KD-POMKTG 17

PLANNING

Develop strategic

Plans

Develop marketing

plans

IMPLEMENTATION

Carrye Plans

CONTROL

Measure results

Evaluate results

Take corrective

actions


18/30

Marketing AnalysisComplete analysis of companys situation, its market andmarketing environment to find out opportunities and avoidenvironmental threats.It must also analyze companys strengths and weaknesses.

Marketing PlanningMarketing planning involves deciding on marketing

strategies in support to attain overall strategic objective of theorganization.

Marketing strategyThe marketing logic by which the business unit hopes to

achieve its marketing objective. It consists of target markets,positioning, the marketing mix and marketing expenditurelevels.

KD-POMKTG 18


19/30

Marketing ImplementationMarketing implementation is the process that turnsmarketing strategies and plans into marketing

actions in order to accomplish strategic marketingobjectives.

Planning good strategies is just the beginning but

success comes only after proper and effectiveimplementation of strategies.

Planning addresses: What & WhyImplementation addresses: Who, Where, When and How.

Doing the right things (Strategy): Doing things right (Implementation)

KD-POMKTG 19


20/30

Marketing Control

Marketing control is the process of measuring and evaluatingthe results of marketing strategies and plans, and taking

corrective action to ensure that objectives are achieved.Set goals Measure Evaluate Take Corrective

Performance Performance Action

KD-POMKTG 20

What do wewant to

achieve?

What do wewant to

achieve?

What do wewant to

achieve?

What do wewant to

achieve?

Operating Control: Checking ongoing performance against theplan.

Strategic Control: Checks the basic strategies are well matched

to its opportunities.


21/30

Marketing Management Philosophies

Production ConceptProduct ConceptSelling ConceptMarketing ConceptSocietal Marketing ConceptHolistic Marketing Concept

The production concept: The philosophy that consumers will favorproducts that are available and highly affordable and that managementshould therefore focus on improving production and distributionefficiency.

One of the oldest philosophies.

Useful in situations:-When demand exceeds the supply-When cost of product is too high and improved productivity is needed to bring it down.

KD-POMKTG 21


22/30

The Product Concept: The idea that consumers will favorproducts that offer the most quality, performance and features andthat the organization should therefore devote its energy to makingcontinuous product improvements.

This concept does not focus on the solution for consumer needsand wants and alternative products may take over the market.So production and product concept are considered as marketingmyopia

The Selling Concept: The idea that consumers will not buyenough of the organizations products unless the organizationundertakes a large-scale selling and promotion effort.

This concept is practices by most firms when they haveovercapacity.

Sell what they make rather than what the market wants.Having less focus on building long-term, profitable relationship

with customer.

KD-POMKTG 22


23/30


24/30

What is a customer?

- A customer is the most important person ever in this organization.

- A customer is not dependent on us, we are dependent on him.

- A customer is not an interruption of our work, he is the purpose of it.- We are not doing a favor by serving him, he is doing us a favor by giving us the

opportunity to do so.

- A customer is not someone to argue or match wits with nobody ever won anargument with a customer.

- A customer is a person who brings us his wants it is our jobs to handle themprofitably to him and to ourselves.

Many companies claims to practice marketing concepts but do not.

The activities to be finely tuned to changing customers need andcompetitors strategies.

Customer driven marketing Understanding customer needs evenbetter than customer themselves do, and creating products and servicesthat will meet existing and latent needs now and in the future.

KD-POMKTG 24


25/30

The Societal Marketing Concept: The idea that the organizationshould determine the needs, wants, and interests of target markets anddeliver the desired satisfaction more effectively and efficiently than docompetitors in a way that maintains or improves the consumers and

societys well-being.

According to the societal marketing concept, the pure marketingconcepts overlooks possible conflicts between consumers short-run wantsand consumers long-run welfare. Societal marketing concept calls onmarketers to balance in companys profit, consumer wants and societysinterests.

KD-POMKTG 25

Consumers

(Want satisfaction)

Societal Marketing

Concept

Society

(human welfare)

Company

(Profits)


26/30

Holistic Marketing ConceptIt advocates Everything matters in marketing

The holistic marketing concept looks at marketing as a complex activityand acknowledges that everything matters in marketing - and that abroad and integrated perspective is necessary in developing, designingand implementing marketing programs and activities. The fourcomponents that characterize holistic marketing are relationshipmarketing, internal marketing, integrated marketing, and sociallyresponsive marketing.

KD-POMKTG 26


27/30

Marketing Challenges in the new millennium

Due to technological advances, rapid globalization, andcontinuing social and economic shifts all are causingprofound changes in the market place.

Connectedness: explosive advances in connecting technologies havecreated exciting new ways to learn about customers and to create tailored

products, distribute them more effectively, and communicate withcustomers in large group or one to one.

Technology for connecting

- Computer

- Information

- Communication

- Transportation

KD-POMKTG 27


28/30

The internet :A vast public web of computer networks that connectsusers of all types all around the world to each other and to an amazinglylarge information repository. The internet makes up to one biginformation highway that can dispatch bits at incredible speeds fromone location to another.

Connection with Customers: Companies are selecting their customers morecarefully and building more lasting and direct relationships with these carefullytargeted customers. (Concept of direct marketing is gaining more popularity).

Connection with Marketing partners:

Connecting inside the company in todays market, all functional area of acompany interacts with customers not only marketing/sales/customer supportpeople.

Connecting with outside partners- Supply chain management (from supplier to company to distribution channel are

interlinked)

- Strategic Alliance (partnership with similar/related product for marketing)

KD-POMKTG 28


29/30

Connection with the world around us:

The companies are more concerned for

social and environmental responsibility.

- Global connection: Marketers are connectedglobally with their customers and marketing

partners.

- Connection with our values and socialresponsibilities: A worldwide consumerismand environmentalism movements has raisedgreater responsibility to the marketers for anyaction they take.

KD-POMKTG 29


30/30

The new connected world of marketingThe old marketing thinking- It viewed marketing as customer acquisition rather than customer

care.

- Trying to make profit on each sale rather than trying to profit bycustomer lifetime value.

- Trying to sell product rather than to understand, create,communicate and deliver real value to the customer.

The new marketing thinking

- Improving customer knowledge and customer connections.- Targeting profitable customer then finding innovative ways to

capture and keep them.- Forming direct connections with customer and building lasting

relationships.- Using more effective ways of communication through targeted

media and delivering meaningful and consistent messages.- Employing more technologies, such as video conferencing,

internets, intranets etc.- Delivering superior value to their customers.

---0---

KD-POMKTG 30

Documents

1INTRODUCTION Meaning & Core Concept Mktg Philosophy