THE FIELD THE FIELD

OF OF

MARKETINGMARKETING

The Field of Marketing

Nature & Scope of Mktg

Evolution of Marketing

Marketing Concept

Ethics in Marketing

Quality in Marketing

Mktg. & Global Economy

NATURE AND SCOPE NATURE AND SCOPE OF OF

MARKETINGMARKETING

What is Marketing?“WE CAN NOT ESCAPES FROM DEATH, TAXES AND

SELLING”

“MARKETING IS ADVERTISING & SELLING”

“EVERYDAY WE ARE BOMBARED WITH TELEVISION COMERCIALS, NEWSPAPER ADS, DIRECT MAIL, & SALES

CALLS - EVERYONE TRYING TO SELL US SOMETHING”

The aim of mktg is to make selling a superfluous. The aim is to know & understand the customer so well that the product or service fits. ..and sell itself” …….Peter Drucker

But Selling & Advertising are only two important functions of Marketing, while Marketing is more than that……….

Roots of Marketing…Exchange & Transaction

Relationship Between Exchange & Marketing?

The root of marketing is in Exchange & Transaction

In broad sense …..

Marketing consist of activities designed to generate and facilitate exchanges intended to satisfy human needs or wants

What is Exchange

“Exchange is the act of obtaining a desired object from someone by offering something in return”

three Ways of Exchange:

If you want food ….. you can get it by yourself (by hunting, fishing or from plants) you can acquire it by theft or some form of coercion you can offer something of value against the product willingly

Conditions of Exchange:

a- two or more parties with need or wants to be satisfied

b- desire & ability to satisfy needs

c- each party have something of value for exchange

d- a way for the parties to communicate

Needs, Wants & Demand

Need - state of felt deprivation– Physical Needs - food, shelter, cloth, safety– Social Needs - belonging, affection, family– Individual Needs - Knowledge, Self expression, promotions

Wants - forms of need shaped by culture & individual personality

Demand - Human wants that are backed by buying power.

Marketers know our needs & wants more than any one….

What is transaction?

“Transaction is a trade between two parties that involves at least two things of value, agrees

upon conditions, a time of agreement and a place of agreement”

The process of transaction is …..

Marketer Environment Market

Marketer & Environment

Marketer

“take initiative in trying to stimulate & facilitate exchange”

Functions of Marketers Make plans and programs Implement it Evaluate & Review it

Environment

“is the place or situation where business activities occur

or the place where buyer & seller gather to exchange goods or services”

Market / Customer

“Market is a person or organizations to whom marketing programs are directed and have a right to accept or reject the offer of marketer”

or

“the set of actual & potential buyers of a product or services”

Roles of Market:

Decision Maker - has a authority to commit to the exchange

Consumer - actually use or consume the product

Purchaser - caries out transaction

Influencer - affect the decision b/c of their position, expertise & power

Definition of Marketing

“A social & managerial process by which individuals & groups obtain what they need & want through

creating & exchanging products & value with others”

“Marketing is a total system of business activities designed to plan, price, promote & distribute(place)

want-satisfying products to target markets to achieve organizational objectives”

“Marketing is anticipation, management, and satisfaction of demand through the exchange

process”

EVOLUTION EVOLUTION

OF OF

MARKETINGMARKETING

Evolution of Marketing

1- Production-orientation Stage (Late 1800s-1930s)

2- Sales-orientation Stage

(Early 1930s-1950s)

3- Marketing-orientation Stage

(Mid 1950 - 1990s)

4- Societal Marketing Concept

(1990s- onwards)What Marketing means?

Difference b/w Selling & Marketing

Production Orientation Stage

“production creates its own demand” concept was accepted

Focused on increasing outputs Mostly Engineers, Architects, manufacturer

shaped the strategies In that era demand exceeded the supply customers views less important no marketing but only selling department Main focus of Manufacturers, retailers &

wholesalers on efficiency & cost control rather customer satisfaction

Sales Orientation Stage

Focused on selling the outputs heavy reliance on promotional activities to sell a

product in an environment of so many choices “Hard selling or aggressive selling”concept

evolved in this era even today unsought goods like encyclopedia,

insurance, political party candidates use this concept to sell their goods or services

Marketing Orientation Stage

War changed the habits of customers– migrated family backed to the homelands– women came out of the homes for jobs– consumers became more knowledgeable– consumers had more choices & got choosy– technology developed during war used for manufacturing

goods & services in peace time companies started to find out the customers needs &

wants companies started to create a balance b/w demand &

supply

What does Marketing mean? Marketing doesn’t meant that every customer get everything

they want but must create a balance b/w value product & profit marketing means customer satisfaction marketing means meeting customers needs profitably don’t offer but ask customer what they want , you just figure out

how to supply it Marketing is a back bone of every organization means

everybody from top to bottom in organization know the importance of marketing

getting Mktg.. Heads, mktg. teams, mktg. research office doesn’t mean that the org. is mktg. stimulated but org must finely tuned to the changing customer needs & competitors strategies

Difference b/w Selling & Marketing

Marketing Selling

Emphasis is on product Emphasis is on customer'swants

Inside - Out process Outward - inside-outwardprocess

Management is salesvolume oriented

Management is profit oriented

Short-run planing Long-run planing

Needs of sellers arestressed

Wants of buyers are stressed

MARKETINGMARKETING

CONCEPTCONCEPT

The Marketing Concept

Nature & Rationale

Refinement of marketing concepts– Relationship Marketing– Mass customization– Value Creation– Return on Marketing investments– Societal Marketing Concept

Some Marketing oriented logos

Nature & Rationale of Marketing Concept

Three beliefs of Marketing Concepts: all planning & operations should be Customer

Oriented

Example: Frito-Lay- covers half US market & charge highest price says “We have to be perfect :after all , no one really needs a potato chip”

all marketing activities in an organization should be coordinated

essentiality to achieve organization’s performance objectives

1- Relationship Marketing “an on-going interaction b/w buyer & seller in which the

seller is continuously improves its understanding of the buyers needs, and the buyer become increasingly loyal to the seller because its needs are being so well satisfied”

the relationship is more like partnership focus to create goodwill & sense that firms cares for customer

example - In France during peak tourism period Nestle’s baby food division provides rest stops for families with young children, distributes Samples of Nestle products, free diapers, & trained hostesses offer assistance to parent

today relationship extended beyond customer to suppliers, employee, the government & even competitors example - IBM strategic alliance with Toshiba & Siemens to develop memory chips.

2- Mass Customization

“Developing, producing, and delivering affordable products with enough variety & uniqueness that nearly every

potential customer can have exactly what he or she wants”

by producing large quantity of products, firms keep the unit cost low & offer need satisfying products at attractive prices

this concept adopting rapidly worldwide because of tremendous advancement in information technology

the concept is not restricted to small items example - Automobile manufacturer offers many makes, models, accessories, options & color

2- Value Creation

“Customer perception of all benefits of a product weighed against all the costs of acquiring & consuming all the

product”

Marketer are taking a closer look at what customers value in a product

With better technology & consistent improvement can add value in the product

Two points: – value means much more to the buyer than the amount

of money for a product– The determination of value is distinctive for each

individual

3- The Societal Marketing Concept

“ companies are not only concerned of the buyers but also other people directly affected by its operations & with not

only tomorrow but also the long term”

it’s a revised/modern marketing concept focus is to maintain & improve the customer’s & society’s well

being Overlook possible conflicts b/w consumer’s short-run wants &

consumer’s long-run welfare function of Marketer become :

– satisfy customers wants– meet the social needs of other affected by the firms activity– achieve the company’s performance objectives

Some Marketing Concept - Oriented Logos of the Companies...

WE MAKE IT HAPPEN FOR YOU - MARRIOTT HOTELS

TO FLY TO SERVE - BRITISH AIRWAYS

WE ARE NOT SATISFIED UNTIL YOU ARE - GE

QUALITY, SERVICE, CLEANLINESS, VALUE - MC DONALDS

THERE IS ONLY ONE BOSS: THE CUSTOMER - WAL MART

THE POWER ON YOUR SIDE - ALLIANZ INSURANCE

LETS MAKE THINGS BETTER - PHILLIPS

ETHICS ETHICS

AND AND

MARKETINGMARKETING

Definition of Ethics

“are the rules we agree to play by” “are the standards of behavior generally accepted by a

society” “ethical behavior based /involves honest & proper

conduct of ‘What is right & what is wrong’”

Marketer has to perform a variety of functions (planning product, pricing, promoting & placing of product) and responsible of variety of groups (customer , suppliers, employees/co-workers, distributors & society) so the manner of behavior to communicate with all these gps of people is a challenge for marketer

What is ethical Behavior?Marketing Related Ethical Issues

1- Process related Mktg. Issues- unethical use of Marketing strategies & tactics

2- Product related Mktg. issues- appropriateness of Marketing of Product

example - tobacco, sugar coated cereals, political candidates

Legal Ethical Issues Defamation - Libel (written) and slander (oral) Individual privacy discrimination - gender, racial, ethical group or national origin Harassment - physical or mental Plagiarism - use of ideas or material of another by your own name

Instilling an Ethical Orientation

By workshops -e.g. Most of Multinational companies by ethics committees by ethical code of conduct - e.g. Hewlett Packard, Johnson &

Johnson by news letters & company magazines- e.g. Texas

Instruments by ethical officers - e.g. McDonnell Douglas Corp.

Focus -- to design & promote the suitable & acceptable standards of behavior for employees

Benefits of Ethical Behavior

Ethical behavior strengthen trust & relationship b/w suppliers, customers, employees, & other groups

provide a straight & direct way to employee Provide crystal clear working environment

Example - Johnson & Johnson - Tylenol Crisis - Eight people died because of tampered product, recently J & J admitted that employees has intentionally destroyed documents required by Govt..

Example - Procter & Gamble & Unilever MIS case- of haircare product of Unilever

QUALITY QUALITY

IN IN

MARKETINGMARKETING

Definition of Quality

freedom from defect

quality is something to do for customer but , if

the customer doesn’t like it, its defect”

acceptable level against competition

how well a product meets the expectation of the

customers

three Components of Quality definition

Three Components of Quality

First - meeting & striving to exceed the requirements of the customer

Second - absence of variation - consistently delivering of goods & services what it was designed to, without variation from one experience to another

Third - TQM - Total quality management - adopting processes & procedures that will provide customers with the right product at the right place.

Example : ISO 9000 Certification - ISO 9001, ISO 9002, ISO 9003 , ISO 9001-2000

Instilling Quality Benchmarking - studying competitors & non-

competitors to identify the highest performance in such areas as delivery delays & eliminating defects

Corporation work under the atmosphere of trust & co-operation

a commitment of employees to constantly search for better ways of performing their functions

forming partnership with suppliers & customers

Measuring quality & the resulting customer satisfaction

Importance of Importance of Marketing Marketing

and and

Global EconomyGlobal Economy

World is a global Village Recent 11th Sep 2001 incident European Union & Euro money Advancement of Information Technology Example

– MTV - US- MTV, Pan-European MTV, Latin American MTV, Asia -MTV, Japanese MTV

– Coca Cola - Serve world wide , faced difficulty in Arab countries & Germany but then became successful

– Toys R Us - 76 European stores , mostly in developed countries, In Japan faced many problems but first day 60,000 visitors visited the shop & opened 16 stores in two years.

Marketing & Global Economy