MARKETING 101 - VentureBean · Marketing Basics - Soumya Sarkar. EVOLUTION OF MARKETING CONTD. •Market orientation –All activities aimed at customer –CEO is the driver •Relationship

M A R K ET I N G 1 0 1

S O U M YA S A R K A R

I I M R A N C H I

Marketing Basics - Soumya Sarkar



WHAT IS MARKETING?

The activity, set of institutions, and processes

for creating, communicating, delivering,

and exchanging offerings that have value

for customers, clients, partners, and society

at large



MARKETING MANAGEMENT

The art and science

of choosing target markets

and getting, keeping, and growing

customers through

creating, delivering, and communicating

superior customer value

MARKETING SPECTRUM

What can be marketed?

O Products

O Services

O People

O Places

O Events

O Ideas

O Causes





EVOLUTION OF MARKETING

• Economic activity

– Production and movement of goods from producer to

consumer

– Use of branding marks – cattle

– Advertisement - 1704

• Information

• Promotion not needed

• Production orientation

– Customers sought for the products manufactured

– Little or no emphasis on customers

– Keep the plants loaded


EVOLUTION OF MARKETING CONTD.

• Sales orientation

– Sales volume focus

– Sell what the plants manufacture

– Advertising/promotional schemes

• Customer orientation

– Customer is central

– Product development process looked from customer perspective

– Appearance of consumer goods – branding/marketing


EVOLUTION OF MARKETING CONTD.

• Market orientation

– All activities aimed at customer

– CEO is the driver

• Relationship orientation

– Creation and maintenance of relationships with customers and

suppliers

– Value-addition

– Augmentation of product with services



PRODUCT VS. MARKET ORIENTATION

Company Product Definition

Railways We run trains

Xerox We make copying equipment

BPCL We sell petrol and diesel

Paramount Pictures We make movies

Blue Star We make air conditioners

Market Definition

We move people and goods

We help improve office productivity

We supply energy

We market entertainment

We control climate at homes and offices


INTERNAL MARKETING

Task of

hiring, training, and motivating able employees

to serve customers well

NEW TRENDS

• Societal marketing: preserving/enhancing the

consumers’/society’s well-being

– Green marketing

– Sustainable marketing

• Cause-related marketing: promoting social issues

• CSR

• Ethical marketing


TYPES OF MARKETS

• Based on physicality

– Retail markets

– Internet: e-commerce

• Based on regularity

– Markets/malls

– Ad-hoc auctions

– Garage sales

• Based on products

– Consumer goods – consumer markets

– Intermediate goods – business markets


TYPES OF MARKETS CONTD.

• Based on resources

– Labour

– Foreign exchange

– Shares

– Commodities

– Real estate

• Others

– Artificial markets – created out of legislation or derivatives

– Illegal markets



CONSUMER MARKET

• End-user

• Individuals and/or households

• Potential/active buyers of products or services

• Consumer products – directly fulfill the desires of

consumers; not intended to be used in the

manufacture of other products



BUSINESS MARKET

• Manufacturers, intermediaries, wholesalers

• Business customers -

– Business-to-business (B2B)

• Geographical proximity

• Derived demand

• Buying centre-based purchasing


CUSTOMER VALUE

• Customer Perceived Value (CPV) = Perceived

benefits – Perceived costs

• Perception matters - management


Functional benefitsBrand

benefitsOther benefits

Purchase priceOther

costsCPV


VALUE CREATION AND DELIVERY

Assessing market opportunities and customer value

Choosing the value

Designing value

Delivering value

Communicating value

Growing and sustaining value


Value Chain

Tool for identification of ways to create more customer value -

every firm is a synthesis of primary and support activities in order to

design, produce, market, deliver, and support its product

MANAGING CPV

• Increase benefits

– Add new features

– Improve accessibility

• Reduce costs

– Reduce price

– Increase efficiency

• Combination of both the above


UTILITY

• Value that marketers hope consumers would attach to their

products/services

• Consumers decide on value

• Need – necessity to meet an urgent requirement

• Want – desire for something not too essential

• Demand – financial capacity to buy what a person wants


HIERARCHY OF NEEDS

• Stated need – explicitly expressed

• Real need – actually needed product/service

• Unstated need – assumed to be fulfilled

• Delight need – unspoken additional needs

• Secret need – some deep-lying desire, may not be related to the stated

need


DEMAND

• Negative

• Nonexistent

• Latent

• Declining

• Irregular

• Unwholesome

• Full



RELATIONSHIP MARKETING

Customers

Employees

Marketing Partners

Financial Community

RELATIONSHIP MARKETING

• Orientation on part of the firm to develop

relationships

• Commitment

• Elements

– Trust

– Communication

– Personalisation

– Customisation


CRM

• Activities used to establish, develop and maintain profitable

customer relationships

• External

– Connecting to the customers

– Technology – data capture

• Internal

– Management of information

– Technology – data mining


LOYALTY PROGRAMMES

• Future rewards

– Frequent flyer miles – Jet Privilege

– Cash back – ICICI Bank credit cards

– Points – Crossword bookstore

– Fuel – Indianoil

• Cash discounts on purchases

– Pantaloons Green Card

• Coalition programmes

– Payback


CONSUMER BEHAVIOUR

• Activities directly involved in obtaining, consuming and disposing

of products/services

• Including the decision processes that precede and follow these

actions


THEORY & REALITY


INFORMATIONSEARCH

PROBLEMRECOGNITION

EVALUATION OFALTERNATIVES

PURCHASE

POSTPURCHASEEVALUATION/

BEHAVIORSTheory

Complications

SUMMARY

Tota

lity

of deci

sions What?

Why?

How?

When?

Where?

How much/often?

Consu

mption Acquisition

Usage

Disposition Offeri

ng Products

Services

Ideas

Activities

By Information

gatherer

Influencer

Decider

Purchaser

User

Ove

r tim

e Hours

Days

Weeks

Months

Years


CONSUMER PSYCHOLOGY

• Motivation – energetic,

ready and willing to

engage in a goal-

relevant behaviour

– Needs

– Perceived risks


PERCEPTION

• Sensing a marketing stimulus

– Visual – size, shape, colour

– Audio – music, noise

– Touch

– Taste, smell

• Perceptual organisation

– Figure and ground

– Closure

– Grouping


FIGURE & GROUND


GROUPING


ATTITUDES

• Overall evaluation that expresses liking/disliking for a

product/person

• Functions

– Guide thoughts – cognitive

– Influence feelings – affective

– Affect behaviours – conative

• Consumer effort

– High – cars, insurance

– Low – toothpaste, magazines


AGE & LIFE STAGE


• Chronological age

• Cognitive age

• Age cohorts - Group of people born at roughly the same time in

the same place/country – experienced the same major

economic, political and social upheaval

• In India

– Midnight’s children (Rushdie)

– Liberalisation children

– Pre-Independence generation

– Midway children or Rajiv Gandhi age cohort (Bijapurkar)



REFERENCE GROUPS

• People whose values are shared by consumers, and

whose opinions are valued

• Direct / indirect influence on consumer thoughts

• Expertise & trustworthiness

• Types used in marketing

– Celebrities

– Expert

– “Common man”

– Executive/employee


SOCIAL CLASS

• Characteristics that distinguish

certain members of a society from

others

– Wealth

– Vocation

– Education

– Power

– Residence

– Ancestry

• SEC classification


IMPORTANCE OF SOCIAL CLASS

• Upper class

– Invest & save more

– Use product characteristics (not price) as indicators of quality

• Middle class

– Look towards upper class for social behaviour guidance - upward

mobility

• Working class

– Increased presence of women, esp. in service sector

– Shop in mass merchandising outlets


SOCIAL SYMBOLS

• Conspicuous consumption

– Keep up with the respected members

of that class

– Trade up

– Wastages - encyclopedia

• Materialism

• Status symbols

– Judging others

– Fraudulent symbols



GENDER ROLES

• Social expectations of appropriate attitudes and behaviours from

the genders

• Evolve and change over time

• Gender identity

• Media stereotyping


FAMILY


• First influencers

• Normative behaviour and distinct roles

• Family structure changing over time

– Joint nuclear single parent DINKs live-in

same sex

• Role of spouses

• Role of children

– Princess syndrome

SEGMENTS


Mass

marketingCustomisation

Segments

SEGMENTATION

• Allows businesses to look at several different groups instead of one

mass market

• Identifies groups that have similar market responses

• A segment should be

– Homogeneous

– As diverse as possible from other segments

– Having a critical mass

– Having core similarities of attitude, behaviour, and economics

– Robust and replicable


SEGMENTATION BASE - CONSUMER

• Group of characteristics used to assign segment members

– Demographic

– Psychographic

• Lifestyle

• Class

• Personality

– Behavioural

• Attitudes

• Usage

• Life events


SEGMENTATION BASE - BUSINESS

• Demographic

• Geographic

• Benefits

– Service support

– Financing/credit terms

• Operating characteristics

• Purchasing approach

• Situational factors

– Size of order

– Urgency


TARGETING

• Evaluation and selection of the most viable segment to enter

• Selection criteria

– Attractiveness

– Size and growth potential

– Brand objectives

– Resources to form basis for competition


TARGETING APPROACHES

• Undifferentiated

– Market as a whole

– Focus on similarities – than on differences

• Differentiated

– Unique product/service tailored for each segment

• Niche

– Serving a small but well-defined segment

– Limited resources or exclusive products


POSITIONING

• Placement of a product/service offering in the mind of the target

consumer

• Development of marketing programmes to meet the

requirements

• Types

– Functional

– Symbolic

– Experiential


POSITIONING TOOLS

• USP

– Expression of the uniqueness of the brand in a succinct manner

– Commitment that others cannot match/imitate

• Value proposition

– Entire set of benefits that differentiate the brand

– Unique

– Specifically relevant to the target


SELECTING A POSITION

• Deliver a valued benefit to the target

• Be distinctive vis-à-vis the competition

• Offer a superior benefit that can be communicated easily

• Difficult for others to copy

• Affordable to the target

• Provide required revenues/profits to the brand


T H A N K Y O U ! !


Documents

MARKETING 101 - VentureBean · Marketing Basics - Soumya Sarkar. EVOLUTION OF MARKETING CONTD. •Market orientation –All activities aimed at customer –CEO is the driver •Relationship