What is Marketing?

• Personal Selling?• Branding?• Advertising?• Making products available in

stores?• Maintaining inventories?

All of the above, plus much more!

What is Marketing?

• “Marketing is an organizational function and

a set of processes for creating,

communicating and delivering value to

customers and for managing customer

relationships in ways that benefit the

organization and its stakeholders.”

- The American Marketing Association.

In other words…

Forms of Utility• Form Utility: PRODUCE goods or services.

• Task Utility: CREATE that is required by customers.

• Time Utility: Available WHEN there is demand.

• Place Utility: Available WHERE it is required.

• Possession Utility: Customer having the product after payment. They POSSESS it.

The Concept of Exchange

• It means that people give up something to receive something they would rather have.

The Concept of Exchange

Necessary Conditions

for Exchange

Necessary Conditions

for Exchange

At Least Two Parties

At Least Two Parties

Something of Value

Something of Value

Communication and Delivery

Communication and Delivery

Freedom to Accept or Reject

the Offer

Freedom to Accept or Reject

the Offer

Desire to Deal With Other Party

Desire to Deal With Other Party

The Concept of Exchange

• Exchange will not necessarily take place even if all these conditions exist.

• An agreement must be reached between the buyer & seller.

• Marketing occurs even if exchange does not take place.

Evolution of Marketing

Simple Trade Era: Exchange of goods or services without using money. Sales Surplus

Production Era: More focus on production of specific products. Increased Supply

Sales Era: Selling of surplus stocks through advertising, personal selling etc and Beat the competition.

Marketing Department Era: Co-ordination and control of many marketing activities in a Marketing Department.

Marketing Company Era: Long-run satisfaction and sustainability. Involvement of everyone in the organization for better customer relationships.

Societal-Marketing Orientation

Market Orientation

Sales OrientationProduction Orientation

Marketing Management Philosophies

Marketing Management Philosophies

1. Production Orientation• Focuses on internal capabilities of

firm.• More emphasis to production rather

than consumption • Best used when:

competition is weak demand exceeds supply generic products competing solely on price

• Problem is that they don’t understand wants/needs of marketplace.

2. Sales Orientation

• People will buy more goods/services if aggressive sales techniques are used.

• High sales will result in high profits.

• Used with unsought products life insurance encyclopedias

• Problem is that they don’t understand wants/needs of marketplace.

3. Market Orientation

• Focusing on customer wants so the organization can distinguish its products from competitors’.

• “The social and economic justification for an organization’s existence is the satisfaction of customer wants and needs, while meeting organizational objectives is Marketing Concept.”

• Integrating all the organization’s activities, including promotion, to satisfy these wants.

4. Societal Marketing Orientation

•Focus on the fact that its not only about meeting customer satisfaction & organizational objectives but also society’s long term interests.

•Management is called upon to bring about balance of 3 factors:

Profitability Customer demand satisfaction Public interest / Social

Awareness.

What helps people, helps business.- Leo Burnett

The Organizations Focus

Key Issues in Developing Competitive Advantage

Key Issues in Developing Competitive Advantage

Create Customer

Value

Create Customer

ValueBuild Long-Term

Relationships

Build Long-Term Relationships

Maintain Customer

Satisfaction

Maintain Customer

Satisfaction

Customer Value

• The ratio of benefits to the sacrifice necessary to obtain those benefits.

Customer Value

Requirements:• Offer products that perform • Give consumers more than they

expect • Avoid unrealistic pricing.• Give the buyers fact [Informative

advertising and knowledgeable salespeople]

• Offer organization wide in service & after sales support.

Customer Satisfaction

• Customer satisfaction is customer’s evaluation of a good or service in terms of whether it has met their needs and expectation.

Customer Satisfaction

Expectation

Performance

108

• If performance is lower than expectations, satisfaction is low.

• If performance is higher than expectations, satisfaction is high.

810

Expectation

Performance

• Meet or exceed customer’s expectations

• Focus on delighting customers

• Provide solutions to customer’s problems

• Cultivate relationships,NOT one-time transactions

How to maintain Customer Satisfaction….???

Building Customer Relationship

• The name of a strategy that entails forging long-term partnerships with customers, both individuals and firms.

Building Customer Relationship

• Attracting new customers,

• Increasing business with existing customers, and

• Retaining current customers.

Relationship Marketing

Relationship marketing strategies depend on:

• Customer-oriented personnel who focus on maintaining relationships with customers.

• Effective training programs to teach employees and managers how to treat customers.

• Employees with more authority to solve customer problems.

• Teamwork.

Firm’s Business

“Benefits” instead of “goods/services”

• Ensures a customer focus

• Encourages innovation

• Stimulates an awareness of changes in customer preferences

Tools the Organization uses to Achieve its GOAL

•Focus on generating sales through intensive promotional activities. •Believe in selling what they produce rather than what customer wants.•E.g. Life Insurance, Vacuum Cleaners.

SALES ORIENTATION MARKET ORIENTATION

•Focus mainly on customer needs and wants.•Promotion is one of the 4p’s of Marketing [product, price, promotion and place]•Believe in customer satisfaction.

Non-Profit Organization requires Marketing too…

• A non-profit organization is a legally constituted organization whose objective is to support or engage in activities of public or private interest WITHOUT any commercial or monetary profit. E.g. Jaipur Foot

• Non-profits are not selling products, they are selling their organization's mission, their ideas, their programs, and their services.

• Operate with the assumption that support and recognition will automatically come to a good cause.

Non-Profit Organization requires Marketing too…

• But this is a false premise....• Non-profit management should

make other groups, associations, businesses, and individuals aware of their mission and continuously maintains that level of awareness.

• Marketing helps in achieve this prime objective.

Micro Marketing Vs Macro Marketing

• It consists of activities performed within the organization.

•Focus on customer needs drive all aspects of the marketing mix.

•Main aim is build up Customer relationship.

•E.g. Microsoft

• Refers to the social process that directs the flow of goods and services from producer to consumer.

• Focus is to effectively match supply and demand and at same time accomplish society’s objectives.  

• Main aim is customer satisfaction.

• E.g. B.E.S.T Daily Pass.

Marketing Process

• Analysis: Analyzing and understanding the market.

• Planning: Marketing programs and events must be designed for influencing the market's customers and consumers, and even the firm's competitors.

• Execution: The marketing events are executed in the markets: advertisements are run; prices are set, sales calls are made, etc.

• Monitoring: Markets are not static entities and thus must be monitored at all times.

Why study Marketing?

• Plays an important role in society

• Vital to business survival, profits and growth

• Offers career opportunities

• Affects your life every day

• Better-informed consumers

• Demand for customer satisfaction

Marketing is not an event, but a process ... It has a

beginning, a middle, but never an end, for it is a process. You improve it,

perfect it, change it, even pause it. But you never stop

it completely.

- Jay Conrad Levinson