Marketing Management Process

o Analyzing market opportunities Market research and information system Understanding consumer market Understanding organizational market

o Researching and selecting target market Measuring and forecasting demand Market segmentation, Targeting and positioning

o Developing the marketing mix Designing product Pricing product Placing product , Promotion strategies

o Managing the marketing effort Competitor analysis and competitive marketing strategies Planning, implementing, organizing and controlling marketing programs.

Analyzing market opportunities

SLIDE NUMBER 8 & 9

Business operates within a fast changing and unpredictable Business operates within a fast changing and unpredictable environmentenvironment

S In S In ComCom In Cus In Cus

Demographic

CompetitorsCompetitors

PublicPublic

EconomicSocial

Natural

Legal

Political

Macro

environment

Micro Environment

Core marketing System

Marketing environment: consists of the actors and forces that affect the company’s ability to develop and maintain successful transactions and relationship with its target customers.

The micro environment: consists of the actors in the company’s immediate environment that affect its ability to serve its market.

The macro environment: consists of the larger societal forces that affect all the actors in the micro environment.

Customer AnalysisPerformance Analysis :Profitability, sales, customer satisfaction, product quality, relative cost etc.Competitor Analysis

Determinants of strategic option: past and current strategies, strategic problems, organizational capabilities and constraints, financial resources and constraints, s & w

Market Analysis

Environmental analysis

O & T, trends and strategic Uncertainties

Strategic S, W, problems, constraints and uncertainties

Strategic Identification and selection

Strategic Analysis

External Analysis Internal Analysis

Success probability depends on whether:

company’s business strengths match the key success factors (KSF) company’s business strengths exceed those of its competitorsKey Success Factors: Assets and competencies that provide the basis for competing successfully. Two types of KSF:

Opportunity : an arena of need in which a company can perform profitably

Opportunities can be listed and classified according to their attractiveness and the success probability

Strategic strengths (superior competencies): Those at which a company excels. These assets and competencies are superior to those of competitors. They provide a base of advantage.

A strategic competency is something a business unit does exceptionally well that has strategic importance to that business ( e.g. manufacturing or promotion).

Strategic necessities : minimum skills and assets that a business must possess to even consider operating in the chosen market/industry. They do not necessarily provide an advantage because others have them. But their absence will create a substantial weakness. Business with only strategic necessities are usually market followers.

A strategic asset is a resource that is strong relative to that of company’s competitors (e.g. brand name, installed customer base).

Impact analysis is a tool that help to evolve that threat into strategy

An environmental threat : a challenge posed by an unfavourable trend or development that would lead, in the absence of defensive marketing action, to sales or profit deterioration.

(1). The impact of a strategic uncertainty : Each strategic uncertainty involves potential trends or events that could have an impact on present, proposed and even potential SBU

Impact Analysis: ( assessing systematically the impact and immediacy of the trends and events that underlie each strategy uncertainty) The assessment of the relative importance of strategic uncertainties. Which uncertainties merit intensive investment in information gathering and in-depth analysis, and which merit only a low key monitoring effort

The extent to which a strategic uncertainty should be monitored and analyzed depend on its (1)impact and (2)immediacy

(2) The immediacy of a strategic uncertainty is related to

The probability that the involved trends or events will occur

The time frame of the trends or events

The reaction time likely to be available, compared with the time required to develop and implement appropriate strategy

The impact of a strategic uncertainty is related to:

The extent to which it involves trends or events that will impact existing or potential SBUs

The importance of involved SBUs

The number of involved SBUs

Strategic Uncertainty Categories

Low

High

Impact

Immediacy

Low High

Monitor & Analyze:

Contingent strategies considered

Analyze in depth; develop strategy

Monitor Monitor & Analyze

Major Opportunities

High Low

Major

Threats

High

Low Ideal Business

Speculative Business Troubled Business

Mature Business

Management needs to monitor the larger forces and actors in the marketing environment if it is to keep its products and marketing practices current. For this purpose management must develop and manage information.

Marketing Information System (MIS)

MIS consists of people, equipment, and procedures to gather, sort, analyze, evaluate, and distribute needed, timely, and accurate information to marketing decision makers.

Marketing Managers

Analysis

Planning

Implementation

Control

Assessing Information Needs

Distributing Information

Developing Information

Internal Record

Marketing Intelligence

Marketing Decision Support Analysis

Marketing Research

Marketing Environment

Target Market

Marketing Channels

Competitors

PublicMacro Environmental Forces

Marketing Information System

Marketing Decisions and communication.

Internal records system : includes reports on orders, sales, prices, inventory levels, receivables, payables, and so on. It supplies result data

Marketing Intelligence System : a set of procedures and sources used by managers to obtain their everyday information about pertinent developments in the marketing environment.

This information is obtained by reading books, newspapers, and trade publications; talking to customers, suppliers, distributors, and other outsiders; and talking with other managers and personnel within the company .

But, this system is casual, and valuable information could be lost and or arrive at too late.

Additional steps to improve the quality and quantity of MI

Train and motivate the sales force to spot and report new developments. Motivate distributors, retailers, and other middlemen to pass along importance intelligence.

Purchase information from outside suppliers

Establish an internal marketing information center to collect and circulate marketing intelligence.

Marketing Research

The systematic and objective identification, collection, analysis, and dissemination of information for the purpose of improving decision making related to the identification and solution of problems and opportunities in marketing

Problem Definition: PD in any research is the most important issue. In defining the problem, the researcher should take into account the purpose of the study, the relevant background information, what information is needed, and how it will be used in decision making.

Marketing research Process

A problem exists when we do not have enough information to answer a question.

Criteria of a problem It should be original: The purpose of research is to fill the gaps in existing knowledge to discover new facts and not to repeat already known facts. Therefore, a preliminary survey of the existing literature in the proposed area of research should be carried out to find out the possibility of making original contribution.

It should be neither very general nor very specific: If the problem is very general, it is usually too vague to be tested. If the problem is very specific, it is usually too narrow to be important or consequential. Some kind of compromise must be made between generality and specificity.

It should be solvable: a problem may be unsolvable due to two major reasons:

1. It may concern some supernatural of amorphous phenomena.The impossibility of obtaining relevant data renders the problem unsolvable.

2. It cannot be operationally defined. An operational definition of a problem specifies the activities or operations the investigator must perform in order to measure it. Once the method of recording and measuring a phenomenon is specified That phenomenon is said to be operationally defined.

It should be feasible: Feasibility should be checked against the following considerations:

Study design

Access to organization and respondents Sample or universe to be tested Source of data Method of collecting data

Type of variables (nominal”ordinal) involved Selection of scales of measurement and statistic

Time required for study and its availability

Funds required and their availability

Development of An Approach to the Problem: Includes formulating an objectives or theoretical framework, analytical models, research questions, hypotheses, and identifying characteristics or factors that can influence the research design.

Research Design Formulation: Framework or blueprint for conducting a marketing research design. RD details the procedures necessary for obtaining the required information, and its purpose is to design a study that will test the hypotheses of interest, determine possible answers to the research questions, and provide the information needed for decision making.

Conducting exploratory research, precisely defining the variables, and designing appropriate scales to measure them are also part of the research design.

Formulating the research design involves the following steps:

2. Design the exploratory, descriptive, or causal phases of the research

3. Methods of collecting quantitative data (survey, observation, and experimentations)

1. Definition of the information needed

4. Specify the Measurement and scaling procedures

5. Questionnaire design

6. Sampling process and sampling size

Element: The object about which or from which the information is desired.

The sampling design process

Define the target population : collection of elements or objects that posses the information sought by the researcher. Defining the target population involves translating the problem definition into a precise statement of who should or should not included in the sample.

The target population should be defined in terms of elements, sampling units, extent and time.

Unit: an element or a unit containing the element, that is available for selection at some stage of the sampling process.

Extent: geographical boundaries

7. Plan of data analysis

Time: Period under consideration

Defining the sample frame

Representation of the elements of the target population. It consists of a list or set of direction for identifying the target population.

Determine the sample size

Select a sampling technique (slide 25)

Classification of sampling technique

N on p rob ab ility S am p lin g Tech n iq u es P rob ab ilty S am p lin g Tech n iq u es

S am p lin g Tech n iq u es

C on ven ien ceS am p lin g

Ju d g m en ta lS am p lin g

Q u otaS am p lin g

S n ow b a llS am p lin g

N on p rob ab ility S am p lin g Tech n iq u es

S in g leR an d omS am p lin g

S ys tem aticS am p lin g

S tra tifiedS am p lin g

C lu s te rS am p lin g

O th esam p lin g

Tech n iq u e

P rob ab ilityS am p lin g Tech n iq u e

Field Work or Data Collection: Involves a field force or staff that operate either in the field, as in the case of personnel interviewing ( in home, mall intercept) from an office by telephone or through mail. Proper selection, training,supervision, and evaluation of the field force helps minimize data collection errors.

Data Preparation and Analysis: Includes the editing, coding, transcription and verification of data. Each questionnaire or observation form is inspected, or edited, and if necessary, corrected. Number or letter codes are assigned to represent each response to each question in the questionnaire.

Data Presentation and Analysis

Principles of Tabular Presentation

Title: It should be brief – verbs and article omitted – Yet self explanatory, clearly stating the nature, classification and time reference of the information given. Ex: Sri Lanka National Defense Expenditures, 1995 - 2000

Number: Tables are numbered to show their position in a series Using Arabic numbers Ex : Table 3.1

Sources of the Data: Unless they are primary data, sources of data should be cited in order that the source may be referred if necessary

Footnotes: Footnotes are given to explain anything that cannot be incorporated in the table, including certain qualifications on the data or method of computation They follow the table but precede the source. They should be indicated by symbols or letters, not by numbers which might be mistaken for the part of table.

Principles of Graphic Presentation

Number of varieties of graphic materials are available. Ex: bar charts, pictographs, pie charts, and map charts.

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5

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15

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25

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35

40

45

1st Qtr 2nd Qtr 3rd Qtr 4th Qtr

EastWestNorth

Legend

Un

it of Measu

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Figure Number : Title

Always show a baseline for zero, the bottom border of the chart.

Pie Chart

Figure Number and Title

Include the units of value within each slice

Services 48%

Durable goods 39%

Non Durable goods 21%

In determining the appropriate proportion of the pie, the proportion of degrees in a circle should be calculated.

Also, a good rule to follow is to begin slicing the pie from 12 o’ clock position and work your way around clockwise with the sections positioned in decreasing order of magnitude

However, Pie charts become difficult to interpret, when they are cut into many pieces and several are shown alongside one another

Summarizing Statistics : Two major kinds of summarizing statistics.

Measures of Central Tendency ( Measures of Location): Provides measures of the midpoint of the distribution.

Arithmetic Mean : Should be computed only from interval or ratio scaled data.

Median : Requires only ordinal data.

Mode : Requires only nominal data.

Measures of Dispersion : Gives an indication of the amount of variation in the data comprising the distribution

Standard deviation : Difference between the mean and an observed value

Variance and

Range : The spread of the data

Multivariate techniques are used for analyzing data when there are two or more measurements on each element and the variables are analyzed simultaneously.

Report Preparation And Presentation: The entire

project should be documented in a written report which addresses the specific research questions identified,describe the approach, the research design, data collection, and data analysis procedure adopted

Univariate techniques are used for analyzing data when there is a single measurement of each element or unit in the sample, or, if there are several measurement of each element each element is analyzed in isolation. .