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Process of planning and executing the

conception, pricing, promotion, and

distribution of ideas, goods, and services tocreate exchanges that satisfy individuals and

organizational objectives.

Marketing - the Formal Definition:

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A Professor at one of the IIM's (INDIA) was explainingmarketing concepts to the Students:-

1. You see a gorgeous girl at a party. You go up to

her and say: "I am very rich. Marry me!" - That's

Direct Marketing 2. You're at a party with a bunch of friends and see

a gorgeous girl. One of your friends goes up to her

and pointing at you says: "He's very rich. Marry

him." - That's Advertising 3. You see a gorgeous girl at a party. You go up to

her and get her telephone number. The next day,

you call and say: "Hi, I'm very rich. Marry me." -

That's Telemarketing

About Marketing.

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4. You're at a party and see gorgeous girl. You get

up and straighten your tie, you walk up to her and

pour her a drink, you open the door (of the car) for

her, pick up her bag after she drops it, offer her rideand then say: "By the way, I'm rich. Will you marry

me?" - That's Public Relations

5. You're at a party and see a gorgeous girl. She

walks up to you and says: "You are very rich! Canyou marry me?" - That's Brand Recognition


her and say: "I am very rich. Marry me!" She gives

you a nice hard slap on your face. - That's Customer

Feedback


her and say: "I am very rich. Marry me!" And she

introduces you to her husband. - That's demand and

supply gap

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her and before you say anything, another person

comes and tells her: "I'm rich. Will you marry me?"

and she goes with him - That's competition eating

into your market share


her and before you say: "I'm rich, Marry me!" your

wife arrives. - That's restriction for entering new

markets

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Evolution in brief!

*Marketing is old as Civilization!

*Its also a synonym for the art of selling in the past.

*It was only after 1945 that ad agencies began to define

discipline in a way which came close to the modern

marketing concept!*1950s seen as the decade of Advertising!

*1960s became customer focused and extensive use of

Marketing Research to investigate consumer needs &

wants, emerged in its current form.

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The discipline matured in 1970s led by Phillip Kotlers

seminal text Marketing Management .

Marketing evolved from practice to a discipline of

Learning.

Marketing became routinized as a key of Management

function.

In 1970s started, strategic planning, through

environmental changes and competitive positions.

In 1980s Marketing moved into competitive strategies by

Michael Porter and extended to Services.

Biggest Internet Revolution!

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Basically 3 concepts.

1. Entreprenuerial Marketing

2. Formulated Marketing

3. Intrerprenuerial Marketing

Abundance of choice doesnt necessarily mean value Paradox of 21st century!

New PerspectiveValue delivery!

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So Marketing as a process by

which customers needs and wants

are satisfied through quality

products and services offered for

customer satisfaction.
http://www.google.co.in/imgres?imgurl=http://clubbobstercb.com/wp-content/uploads/2010/08/Marketing-Concept.jpg&imgrefurl=http://clubbobstercb.com/marketing/marketing-concept/&usg=__icu2V2J9WaiEokQIxK4MLQpnUoo=&h=475&w=370&sz=18&hl=en&start=9&zoom=1&tbnid=UAbMdBrAsUY29M:&tbnh=129&tbnw=100&prev=/images%3Fq%3Dmarketing%2Bconcept%26hl%3Den%26gbv%3D2%26tbs%3Disch:1&itbs=1http://www.google.co.in/imgres?imgurl=http://clubbobstercb.com/wp-content/uploads/2010/08/Marketing-Concept.jpg&imgrefurl=http://clubbobstercb.com/marketing/marketing-concept/&usg=__icu2V2J9WaiEokQIxK4MLQpnUoo=&h=475&w=370&sz=18&hl=en&start=9&zoom=1&tbnid=UAbMdBrAsUY29M:&tbnh=129&tbnw=100&prev=/images%3Fq%3Dmarketing%2Bconcept%26hl%3Den%26gbv%3D2%26tbs%3Disch:1&itbs=1

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Marketing is for Everybody

TO SHOW THAT MARKETING IS ESSENTIAL

PROVIDE AN UNDERSTANDING OF THE BASICMARKETING CONCEPTS

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http://www.google.co.in/imgres?imgurl=https://www.jumeirah.com/Global/Sirius/About%2520the%2520program/HAMLEYS-logo.jpg&imgrefurl=https://www.jumeirah.com/en/Sirius/About-The-Program1/Partners/London/&usg=__VRnVmNHrg3XAfBO4cHQmrQVKPZQ=&h=300&w=300&sz=16&hl=en&start=60&zoom=1&tbnid=jzGkreBFKW_jtM:&tbnh=116&tbnw=116&prev=/images%3Fq%3DHamley,%2BUK%26start%3D40%26hl%3Den%26sa%3DN%26gbv%3D2%26tbs%3Disch:1&itbs=1

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The Nature of Marketing

What is the Purpose of Marketing?Satisfaction

Functional Satisfaction Psychological Satisfaction

The Four Utilities

Consumer Problems

Providing Benefit Bundles

Offering a Total Consumption System

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Simple Marketing System

Industry

(a collection

of sellers)

Market

(a collection

of Buyers)

Goods/services

Money

Information

Communication

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The Nature of Marketing

What is the Purpose of Marketing?Satisfaction

Increments of Satisfaction Facilitating Exchanges

Conditions for Exchange

Systems of Exchanges

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Evolving Views of Marketings Role

The customer as the controllingfunction and marketing as the

integrative function

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Customers

Front-line people

Middle Management

Top

Management

Traditional Organization Chart

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Customer-Oriented Organization Chart

Customers

Front-line people

Middle management

Top

manage-

ment

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Core Concepts of Marketing

Product or Offering

Value and Satisfaction

Needs, Wants, and Demands

Exchange and Transactions

Relationships and Networks

Target Markets & Segmentation

Marketing ChannelsSupply Chain

Competition

Marketing Environment

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Implications of marketing

Who are our existing / potential customers?

What are their current / future needs?

How can we satisfy these needs? Can we offer a product/ service that the customer

would value?

Can we communicate with our customers?

Can we deliver a competitive product of service? Why should customers buy from us?

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The marketing concept

choosing and targeting appropriate

customers

positioning your offering

interacting with those customers

controlling the marketing effort continuity of performance

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Successful marketing requires:

Profitable

Offensive (rather than defensive)

Integrated

Strategic (is future orientated)

Effective (gets results)

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The Indian Consumers

Changing Spending Patterns

36%

20%10%

4%

30%

40%

20%

9%

4%

27%

2003

32%

20%11%

5%

32%

Food & Grocery Fuel, Transport & Communication Discretionary Expenditure

Rent, Utilities & Education Savings & Investment

2008 2013

Changing consumer behavior is catalyzing change in

spending patterns, freeing up income for discretionaryexpenditure

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Emerging Trends

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Shift to ThriftRedefining Value

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Small WondersSmall Perk Me Up Products

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Mummy ka MagicStays Intact

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Eating Out at HomeEvolving Home Delivery Model

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Taste Bhi, Health BhiA very strong co-relation

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Food On The GoInstant Pick Me Up

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Eco Conscious

Eco ConsciousA light shade of green

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Food As DiscoveryMore Experimenting

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The Food ConnectUse of Social Media

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POP will remain

SupremeThe final test

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The changing Indian consumer

The media explosion.

Increase in disposable income.

The rise of the great Indian middle class

Increase in the number of earning young people

Change in expenditure patterns

Increase in the number of working women 40

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What is Marketing ?

Selling ?

Advertising ?

Any thing more?

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Examples of Buying Motives:

Psychological or Functional?

A senior wants to impress his date at

the prom .

His primary motive is ?

Psychological

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A girl wants to remember her grandmother on her birthday.

Her primary motive is?

Psychological

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A homemaker needs a new washing machine and has had

good experiences with Sears.

Her primary motive is ?

Functional

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A teacher wants to buy a practical car to be used for family

transportation.

Her/His primary motive is ?

Functional

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A career woman always buys Liz Claiborne clothes.

Her primary motive is?

Psychological
http://www.lizclaiborne.com/product/index.jsp?productId=2179527&cp=1986587.1988213&parentPage=family

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An overweight 40 year old man wants to loose weight so

that he can reduce his blood pressure.

His primary motive is?

Functional

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A homeowner needs to mow their lawn.

Their primary motive is?

Functional

C B i B h i C

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Consumer Buying Behavior Competency

Functional

Motive

Psychological

Motive

The price is 40cents off theregular price.

It never needsironing.

Diamonds areforever.

Serving you since1971.

Ninety-daywarranty.

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Consumer Buying Behavior Competency

FunctionalMotive

PsychologicalMotive

Running shoe withbuilt-in arch.

Its all the rage

colored action wearand style.

Wheatiesthebreakfast ofchampions!

Steel-belted radialtires warranted for40,000 miles

A watcha gift shewill treasure

always.

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What is Marketing ?

We use the word Marketing to describe such things as analyzing the needs of the people

trying to guess what types of products they want

estimate how much they will buy

predict when they want to buy

determine where they go to buy the stuff

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What is Marketing ?

. And,

figure out the best price to sell it at - and can you stillmake a profit selling it at that price

decide on promotional things to create awarenessabout the product

look at the competition to see what they are doingwith pricing, features etc.

Marketing is concerned with anticipating consumer

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Marketing is concerned with anticipating consumerdemand and directing flow of goods from producers toconsumers.

Marketing has to do with matching producers outputs to

consumers inputs [ needs & wants ].

Serving the needs of customers is what business shouldbe all about

Marketing is the business function that interpretscustomer needs to the rest of the organization.

Marketing should begin with the customer needs - NOTwith the production process. Mkt. should anticipateneeds.

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The Importance of Marketing

Marketing is a core business discipline

The study of marketing is important to the basics ofrunning a business, big or small

When you buy a product - the cost of marketing amounts to40 ~ 60% of the totaleg. If we buy shoes for Rs.800,Rs.400 of that 800 has been spent on marketing (including

advertising, market research, development etc.)

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The Importance of Marketing

Getting a JOB in Marketing !! Personal selling

Advertising

Package Design

Transportation

Storage

Marketing Research

Product Development Wholesaling

Retailing

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Micro - marketing for a company

Macro - the whole economy

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Micro - marketing for a company, things

you do to accomplish the organizationsobjectives .

Macro - the whole economy and its flow of

goods and services from producers toconsumers

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Micro - Its not just selling stuff, but also

looking at what the customers want

Macro - Looking at how everybody in the

country can have access to things they need.Government has to make sure everybody

has fair access.

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Micro-Macro Dilemma

Government has to step in cause not everythingwould be produced fairly by companies - soregulation needed

Ex .1: It would be cheaper to make cars withoutairbags and seatbelts - but Govt. insists they mustso, it has to be done.

The Marketing Functions

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g

Buying

TransportingStoring

Grading

Financing

Risk Taking

Information Collection

Research.

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Innovation is encouraged by a market-directed economy

(capitalism) because people who come up with new ideas are free to

try and market them and make a fortune. In a communist country,

government has strict controls on the means of production sothere is a limit to what people can manufacture.

In a capitalist economy, people are always trying think of new ways

to satisfy un-met needs, and, this encourage new thinking

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Advocacy Advertising

You are not trying to sell a product, you are trying toget people to believe in something, or behave in acertain way

eg.- Dont drink and drive- Canadian Cancer Society- recycle

- use the TTC, save gas

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Marketing Concept

- Social Responsibility

- improve positive effects on Society andreduce negative effects

- environmental problems

- social responsibility conflicts with profit

objective(raises ?, is mktg concept desirable)

Marketing Concept

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- Social Responsibility

-? Of social responsibility cutting intoprofits

- some companies have been verysuccessful at dealing with this eg. BODYSHOP

- they realize it is a way to endearthemselves to trendy customers

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Company Orientations Towards the Marketplace

Orientation Description Relative TimeSpan

Basic ManagerialObjective

Production Transition from Home

Manufacturing to Factories

Industrial

Revolution

Profit Maximization via

Economies of Scale

Product &Financial

Focus on Product Development,Performance and Features and

the Growth of Large Scale

Industrial Empires

Profit MaximizationThrough Superior

Product Performance

Sales Transition from Scarcity of

Goods to Scarcity of Markets;

Market Saturation with Basics

Profit Maximization via

Demand Generation

Marketing Transition from Internal

(Organization) to External

(Customer) Basis for Guiding

Marketing Decisions

1990s Profit Maximization via

Matching of Products to

Customer Wants

The Marketing Concept

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The Marketing Concept

A Customer Orientation

Backed By Integrated Marketing

Aimed at Generating Customer

Satisfaction and Repurchase As The Key To

Satisfying the Organizations Goals

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The Marketing Concept (Contd..)

Focus Means End

Sales Concept Products Selling &

Promotion

Profits Through

Sales Volume

Marketing

Concept

Customer Needs Integrated

Marketing

Profits Through

CustomerSatisfaction

Stages in Consumer Decision Process

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Stages in Consumer Decision Process

Awareness

Interest

Decision

Satisfaction

Action

Advertising

Channel

Product /

Service

Price

Word-

of- Mouth

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Cost of Losing and Attracting Customers

Cost of attracting a new customer can be upto 5 times the cost

of keeping a current one happy

Cost of Offensive Marketing > Cost of Defensive Marketing

Some companies have increased profits from 25% to 85% by

reducing defections by 5%

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Conduct A Marketing Review (3-C Analysis)

Opportunity Identification

B. Assessment of

COMPANY

Capabilities and

Current Marketing

Position

A. Analysis of

CUSTOMER

Trends, Needs,

Perceptions,

Behavior

C. Analysis of

COMPETITORS

Current Position,

Capabilities,

Actions

I l i Th M k i Mi (F P )

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Implementation: The Marketing Mix (Four Ps)

Product

Price

Place

Promotion

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3C - 4P Framework

Customer

Company

Competitor

Product

Price

Promotion

Place

Colgate

IDSPDA /

Infiniti

Sealed-Air

Barco

Nestle

Rohm&Haas

Intel

Dell

BMW

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Marketing System

Short Term Controllable Factors

Product

Place

Price

Promotion

Long Term Factors

Technological

Legal

Socio / Cultural

Economic

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Recasting the 3C - 4P Framework in Value Terms

Customer

Company

Competitor

Product

Price

Place

Promotion

Creating

Value

Capturing

Value

CommunicatingValue

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Model of Consumer Behavior

MarketingMix

Stimuli

Product Price

Promotions Advertising

Place

Buyers Black Box

??

PsychologicalMemory

Perception

Motivation

Personality

Demographics

Environmental

Family

Culture

Buyers Responses

What is purchased? When, Timing? How much?

For what use?

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The most important aspect of any companys Marketing

concept is identifying its SWOT Analysis.

What is SWOT analysis?

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SWOT Analysis - Examples

Example 1 - Wal-Mart SWOT Analysis. Strengths - Wal-

Mart is a powerful retail brand. It has a reputation for value

for money, convenience and a wide range of products all in

one store. Weaknesses - Wal-Mart is the World's largestgrocery retailer and control of its empire, despite its IT

advantages, could leave it weak in some areas due to the

huge span of control. Opportunities - To take over, merge

with, or form strategic alliances with other global retailers,

focusing on specific markets such as Europe or the Greater

China Region. Threats - Being number one means that you

are the target of competition, locally and globally.

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Example 2 - Starbucks SWOT Analysis. Strengths -

Starbucks Corporation is a very profitable organization,

earning in excess of $600 million in 2004.Weaknesses -Starbucks has a reputation for new product development

and creativity. Opportunities - New products and services

that can be retailed in their cafes, such as Fair Trade

products. Threats - Starbucks are exposed to rises in thecost of coffee and dairy products.

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Example 3 - Nike SWOT Analysis. Strengths - Nike is a

very competitive organization. Phil Knight (Founder and

CEO) is often quoted as saying that 'Business is warwithout bullets. 'Weaknesses - The organization does have

a diversified range of sports products. Opportunities -

Product development offers Nike many opportunities.

Threats - Nike is exposed to the international nature oftrade.

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Example 4 - Indian Premier League (IPL) SWOT

Analysis. Where will you find the Mumbai Indians, the

Royal Challengers, the Deccan Chargers, the ChannaiSuper Kings, the Delhi Daredevils, the Kings XI Punjab,

the Kolkata Knight Riders and the Rajesthan Royals? In

the Indian Premier League (IPL) - the most exciting

sports franchise that the World has seen in recentyears, with seemingly endless marketing opportunities

(and strengths, weaknesses and threats of course!).

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Example 5 - Bharti Airtel SWOT Analysis. Weaknesses -

An often cited original weakness is that when the business

was started by Sunil Bharti Mittal over 15 years ago, thebusiness has little knowledge and experience of how a

cellular telephone system actually worked. So the start-up

business had to outsource to industry experts in the field.

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EX:-1 While entering a developing country like India, MNCs should

consider the factors to which consumers in India are sensitive.One such factor is price. Indian consumers are price sensitive.

They always looks for value of money. This explains the

success of Nirma washing powder which forced HLL to come

out with a low prices detergent Wheel. Also the success of aproduct depends on the tastes and preferences of customers.

Once McDonalds customized its products according to the

tastes and preferences of the Indian customers, it found

acceptability in the market. Thus, before entering the Indian

market, MNCs should do a proper study of the customers

tastes and preferences , and this is particularly applicable to

food products, because in India, food habits differ from region

to region.

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EX:-2

During recession, most companies resort to downsizing

and cutting costs related to advertising. But advertisement

plays a crucial role in creating demand for goods. So it is

not advisable to reduce costs related to advertising, ratherexpenditure on advertisements should increase during a

recession. At this time, they build up their brands. If they

do so, the companies will be in a competitive position once

the recession is over and demand for goods picks up.

Brandbuilding always involves spending on

advertisements, packaging etc. Advertising during

recession is also advisable because it reminds consumers

about the product and prevents the product from getting

erased from consumers mind.

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Case :- Modernizing sales outlets

Mr. Harish was a refugee when he started his small grocerybusiness about 40 years back. Initially, he hawked his goodsdoor to door and soon developed a sizeable number of steadycustomers. This was largely due to his sober temperament,reliable dealings and his amiable nature. His extrovert naturehelped him develop many friends and well wishers.

Over a period of time, Mr. Harish became a socially prominentperson with good acquaintance from many walks of life. Heexpanded the range of his business activities and he now owns aseveral shops dealing in consumer durables, dairy products, a

general store and a large medical shop. Being conservative, hefeels emotionally attached to his original grocery business andcontinues to operate it with enthusiasm. His business place haseven come to be a meeting venue for people of his generation.

His children are grown up and the eldest one Raj has just returned

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His children are grown up and the eldest one, Raj, has just returned

from abroad after completing his Management education.

Ambitious by nature, Raj, would like to expand the business fast. He

feels that he needs to be professional in his approach. In hisopinion, his fathers way of dealing with people is outdated .Many a

time, he feels irritated when his fathers old friends drop in at the

shops and spend time talking with him .Raj feels that this type of

casual coming together is a waste of time .He would prefer to be

more business like. He would like to deal with precision and in amethodical manner .He expects that his customers should appreciate

this modern way of doing business.

He has, however, revealed his inner feelings only in an indirect way

to his father and he found that his father believes in maintaining

close personal links with his customers. Some of the customers

have, anyhow, started noticing the change in the way in which Raj

deals with them. They feel that the old warmth of their relationship

with the senior Harish is somehow missing and they are now less

welcome at the shops.

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Questions

What do you think regarding the contribution of personal

relationship in such a business?

Do you agree with the approach adopted by Raj? Do you

have any suggestions to make?

Documents

MKT. - Introd