Marketing Mangement Specific

8/10/2019 Marketing Mangement Specific

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Marketing


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What is Marketing?Marketing is a societal and managerial

process where people and organizations (customers) obtain what they need and want byexchanging products and services of valuewith each other

Marketing focuses on the needs and wants ofcustomers.

It is concerned about satisfying customersthrough supply of goods and services

Many think marketing is only advertising andselling. But marketing is almost a way of lifethat everybody needs to know.


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Iceberg Theory

Iceberg- underwater

Selling &

advertising

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Water


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Real Iceberg


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Few definitions of Marketing

Marketing is not a science and there isno single universally adopted definition.

Lets discuss about some widely used

definitions.


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Definition- MarketingPhillip Kotler( The Millennium

Edition 2000) Marketing is asocietal process by whichindividuals and groups obtain whatthey want through creating,offering and freely exchangingproducts and services of valuewith others


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Definition of Marketing

According to Eldridge (1970) -

"Marketing is the combination of

activities designed to produce profit

through ascertaining, creating,

stimulating, and satisfying the needs

and/or wants of a selected segment

of the market."


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Definition- Marketing

Dibb, Simkin,Pride and FerrelMarketing Consists of individual andorganizational activities that facilitate andexpedite satisfying exchange relationships indynamic environment through the creation,distribution, promotion and pricing of goods,services and ideas


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Nature of Marketing1. Marketing is an integrated process :

Marketing is not a single activity. It is rather acoordination of several inter-related activities. Theinteraction between different activities gives a uniquecharacter to marketing.

Marketing is a managerial process in so far as itinvolves the functions of planning and control.

Marketing is also a social process as it is concernedwith the satisfaction of human needs and this is oneof the most important Characteristics of Marketing.


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Nature of Marketing

2. Marketing is customer oriented-Marketing exists to identify and satisfy thewants of present and potential consumers.Customer is the focus of all marketingactivities.

3.Marketing is a system- Another importantcharacteristic of marketing is its function as a

system. Marketing is a system comprisingseveral sub systems. Under marketing, inputsare drawn from the society and converted intoout uts which are su lied to the societ .


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Nature of Marketing

4. Marketing is a part of total environment-Marketing operates within the framework oftotal environment which comprises economic,

social, legal, political, international and otherforces. Changes in the environment influencemarketing activities. Marketing is, therefore, adynamic process as it keeps on adjusting to

the changing environment.


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Nature of Marketing

5. Marketing is creative- Marketing createstime, place and possession utilities. Timeutility is created by preserving goods for use in

future. Place utility is created by carryinggoods to places where they are needed themost. Marketing creates possession utility bytransferring products and services from

producer to customer. Exchange processbetween buyer and seller is the essentialelement in marketing.


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Nature of Marketing

6. Marketing is goal -oriented- Of the manyimportant characteristics of marketing; onevery important aspect is it is goal-oriented.

Marketing seeks to achieve benefits, for bothbuyer and seller. It results in mutuallybeneficial relationship by satisfying wants ofcustomers and by generating revenues for

marketers.


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Nature of Marketing

7. Marketing is pervasive- marketing isrequired in business as well in social andother organizations. In other organizations,

marketing is necessary for spreading sociallyuseful ideas and programs family planning,adult education, communal harmony, nationalintegration, environmental protection, etc.

Such marketing is called social marketing.


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Functions of Marketing

Customer is the center of all Marketingactivities.

Marketing focuses on the needs and wants ofcustomers.

Identifying favorable emerging marketopportunities

It is concerned about satisfying customersthrough supply of goods and services


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Functions of Marketing

Marketing involves analysis, planning andcontrol

Marketing is concerned about staying aheadwith competition and making profits

Marketing has a heavy emphasis onrelationships

Creating value to both the customer and

organization


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Development of Marketing

Marketing as an exchange process Exchange is the act of obtaining something by

offering something in return ( money, services, goodsor a combination)

For an exchange to take place following conditionsmust exists:

1. Two parties2. Each party must possess something of value that

the other party likes 3. The parties must be involved voluntarily

4. Parties must be able to communicate about theirvalue proposition


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All profit and non profits are using marketing

Marketing is not only used by commercial profit

oriented organizations but also by other organizationssuch as temples, churches and many other not forprofit organizations and persons.

For example : Temple/Church provide their service (product) to its congregation( customer) It announcers

its activities (promotion) to its congregation (targetmarket). Customer would be the most important element of any

marketing organization. Marketer needs to strive to satisfy its customers as

No customers means No business

Is Marketing a function of management or a


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Is Marketing a function of management or a

business philosophy ? Discuss It is a function of management as well as a business

philosophy It is considered as a function of managementas it

uses management techniques in satisfyingcustomers.

Businesses has various divisions that handlesdifferent functions such as human resource,financial, operations and marketing.

In a typical Marketing Department there aremarketing managers, product managers, salesmanagers, sales representatives, sales persons,delivery assistants etc.


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Marketing as a business philosophy

Marketing is considered as a overall businessphilosophy which runs through all departments of anorganisation and embedded in all the activities of amarketing organization. It is a way of businessthinking.

The idea rooted in satisfying customers through thesupply of goods and services does not restrict to onedepartment or function.

It is the purpose of the whole business. Everyoneshould have the customer oriented attitude in anorganisation.


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WHAT IS MARKETING MANAGEMENT ?

Marketing management is demandmanagement or it involves the task of

influencing the level, timing and

composition of demand. At times the

actual demand level may be below,

equal to, or above the desired demand

level and the major task of marketingmanagement is to regulate the level of

demand.


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On the Line: IngramIngram Micro

Ingram Micro is an American electronicscompany

Took leadership in creating a demand chainamong its supply chain partners.

$22 billion sales of 200,000 products from 1,500manufacturers to 140,000 resellers in 130countries.

Ingram Micro is using a demand chain, ratherthan a supply chain, to focus on meetingconsumer demand.

O th Li


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On the Line:Ingram Micro


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Demand Management -Ingram Micro

1 .Gathering and analyzing knowledge aboutconsumers, their problems, and their unmet needs.

2. Identifying partners to perform the functionsneeded in the demand chain.

3. Developing products and services that solvecustomersproblems.

4. Moving the functions that need to be done to thechannel member that can perform them mosteffectively and efficiently.


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Marketing Management

The analysis, planning, implementation, andcontrol of programs designed to create, build,and maintain beneficial exchanges with target

buyers for the purpose of achievingorganizational objectives.


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Marketing Management

Defined as an art and science that determinesand chooses target markets and attempts tobuild profitable relationships with them.

Managing customer demand and customerrelationships.

Different approaches to the marketing function

evolved over time

directly affect the way marketing takes place.


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Definition- Marketing Management

American Marketing AssociationMarketing Management is the process ofplanning and executing the conception, pricing,promotion, and distribution of ideas, goods andservices to create exchanges that satisfyindividual and organizational goals

"Marketing Management is the managementprocess responsible for identifying, anticipating

and satisfying customer requirements profitably."Chartered Institute of Marketing (2001).


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Principles of Marketing Management

Demand management Promotional activities to increase demand

Building profitable customer relationships

Attracting Retaining Building customer lifetime relationships and

value


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Functions-Marketing Management

Identifying customer requirements throughresearch

Study about customer perception andproducts, set prices, involved in distribution

systems, promotional activities, etc.Anticipate customer demand by forecasting

Work with other functional departments to

develop goods and services to satisfycustomer needs

Simply analyzing, planning, implementationand control of all the marketing activities.

Phil hi f M k ti


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Philosophies of MarketingManagement

The Production Concept

Product Concept

The Selling Concept

The Marketing Concept

The Societal Marketing Concept


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1. Production concept:

All the focus is on the production.

Concentrate on achieving high production

efficiency, low cost& mass distribution.

Maximization of output will decline in the unit cost

&would bring the customers and the profit.

Assume that consumers are primarily

interested in product availability and low prices


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Ex-This orientation makes sense indeveloping countries such as China, wherethe largest PC manufacturer, Legend(principal owner of Lenovo Group), anddomestic appliances giant Haier takeadvantage of the countrys huge andinexpensive labor pool to dominate the

market. Marketers also use the production concept

when they want to expand the market.


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Ex-Inexpensive Toys , ElectronicsExample : Ford T- Model

: Govt. Hospital and other Service

Depts.

Ford T Model


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Ford T Model


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2. Product Concept:

Consumers will favor those productsthat offer most quality, performance orinnovative features

Just making superior products willmake customers seek and buy them.

More focus on Product in theMarketing Mix.


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2. Product Concept:

Ex- Better mouse trap of Woolverth Co.Made a very effective reusable mousetrap thatthe existing ones but price was more thandouble. It did not sell well. People did not wantto spend twice as they used to throw themousetrap also with the catch.

Marketing Myopia- shortsightedness of notconsidering customer needs and behavior


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Woolverths mouse trap


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3.The Selling concept:

The selling concept maintains that a company

cannot expects its product to get picked up

automatically by the customers.

The company has to consciously push its products.

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3.The Selling concept: Aggressive advertising , high power personal

selling , large scale promotion , heavy pricediscounts , strong publicity and public relations are

the normal tools that rely on this concept.

Their aim is to sell what they make rather than

make what the market wants.

Ex-It is practiced most aggressively withunsought goodsgoods buyers dontnormallythink of buying such as insurance and hotelservices

Th M k ti C t


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The marketing concept has been expressed : .Meeting needs profitably..

.Find wants and fill them..

.Love the customer, not the product..Have it your way.. (Burger King)

You are the boss.. (United Airlines)

Putting people first.. (British Airways)Partners for profit.. (Milliken and Company)



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The Marketing Concept The key to achieving organizational goals

consist in determining the needs and wants of

target markets and delivering the desiredsatisfactions more effectively and efficientlythan competitors.

It build profit through customer satisfactionand loyalty.

Ex-Dell doesntprepare a perfect computer for

its target market. Rather, it provides productplatforms on which each person customizesthe features he or she desires in the computer.


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4 PILLARS

The marketing concept rests on 4 pillars,namely

1. Target Market

2. Customer Needs

3. Integrated marketing

4. Profitability


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Marketing and Sales Concepts Contrasted


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The societal marketing concept holds that theorganizationstask is to determine the needs, wants, andinterests of target markets and to deliver the desiredsatisfactions more effectively and efficiently thancompetitors in a way that preserves or enhances the

consumersand the societyswell being.

Societal Marketing =

Consumer Satisfaction + Company s Profits + Societys well

being.



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Ex-McDonalds earmarking of $1 for RonaldMcDonald Childrens Charities from the sale ofevery Big Mac and pizza sold on Mc HappyDay.

McDonaldssponsorship of Forest (a gorilla) atSydneys Zooa 10-year sponsorshipcommitment, aimed at preserving this

endangered species

Marketing Selling1.Marketing starts with the customer ,present and

potential and foc ses constantl on the need of the

1.Selling starts with the seller.It focuses on the need of the

need Seller is the centre of the b siness ni erse acti ities


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potential and focuses constantly on the need of the

buyer.Buyer is the centre of the business

universe.activities follow the buyer and his needs.

need.Seller is the centre of the business universe.activities

starts with sellers existing products.

2.Emphasis on identification of a market opportunity and

fulfilling the needs of the customer.

2.Emphasis on saleable surpluses available within the

corporation.3.Seeks to convert customer needs into products. 3.Seeks to convert productintocash,concernsitself with

the tricks and techniques of getting the customers to buy

the product available with the salesman in exchange of

cash.

4.View business as customer satisfying process. 4.View business as a goods producing process.

5.It is concern with the value satisfaction customershould get from the exchange.

5.Overemphasis the exchangeaspectwithout caring forthe value satisfaction inherent in the exchange.

6.The firm makes a total product offeringthatwould

match and satisfy the identified needs of the customers.

6.The firm makes the product first and then figure out how

to sell it and make profit.

7.Adopting more innovative technology to provide better

value to the customer.

7.Emphasis on staying with the existing technology and

reducing the cost of production.

8.If the enterprise has a customer orientation-concerned

more about his needs,and make genuine efforts to satisfy

those needs ,then it is practising Marketing.

8.If the enterprise has internal orientation concerned more

about itself and its products and the need to dispose off its

products,then it is practicing Selling.

Marketing Selling


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9.Consumer determines price ; pricedetermines cost.

9.Costs determine price.

10.They are seen as vital services to beprovided to the customers keeping in mindtheir convenience.

10.Transportation,storage and otherdistribution functions are merely a part ofproduction function.

11.In firms practicing marketing,marketing

is the central function of the business;theentire company is organised around themarketing function.

11.In firms practising selling,productionis

the central function of the business.

12.Marketingviews the customer as thevery purpose of the business;sees businessfrom point of view of the customer.

12.Selling views the customer as the lastlink in the business.

Holistic Marketing


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Holistic Marketing

The holistic marketing concept is based onthe development, design, and

implementation of marketing programs,processes, and activities that recognize theirbreadth and interdependencies.

Holistic marketing acknowledges thateverything matters in marketingand that a

broad, integrated perspective is oftennecessary.

Holistic Marketing


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Holistic Marketing

Holistic marketing thus recognizes andreconciles the scope and complexities ofmarketing activities.

Holistic Marketing a schematic overview offour broad components characterizing holisticmarketing: Internal Marketing, integratedmarketing , relationship marketing, and

Societal marketing.

Components of Holistic Marketing


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Components of Holistic Marketing

1. Internal marketing

2. Integrated marketing

3. Relationship marketing4. Social responsibility marketing

Diagram of Holistic Marketing


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Diagram of Holistic Marketing

Marketing

Senior

Management Other

Products&

Services


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HolisticMarketing

IntegratedMarketing

RelationshipMarketing

Internal

Marketing

SociallyResponsibleMarketing

Department

g

Departments

Services

Communications Channels

Ethics

Environment Legal

CommunityCustomers

Channel

Partners

Internal Marketing


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Internal Marketing

Internal marketing is based on the theme that

employees are the internal customers of a firmand their satisfaction is of utmost importancein order to achieve the goal of customer

satisfaction. Internal marketing ensures building a skilled

and self-motivated workforce and that everymember of the organization properly

understands the companys marketingorientation and philosophy towards thecustomer satisfaction.

Internal Marketing


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Internal Marketing

Internal marketing is also about maintainingharmony and co-ordination among variousmarketing functions and activities within theorganization.

There should not be any conflicts within themarketing department or between marketingand other departments because that would

somehow negatively affect external marketingalso.

Internal Marketing


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Internal Marketing

Ex- Snowshoe has established Mountain Skiresort incorporated the new brand promise ina 40-page brand book that contained thehistory of the resort and a list of seven attitude

words that characterized how employeesshould interact with guests.

On-mountain messaging and signs also

reminded employees to deliver on the brandpromise.

Integrated Marketing Integrated marketing is based on the


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Integrated marketing is based on theproposition that the marketers instead of

deciding for individual marketing activitiesshould make an integrated marketing programwith the purpose to create, communicate anddeliver value for the customers.

The aim of integrated marketing is to gainsynergy out of all marketing activities and it isonly possible when an integrated approach is

adopted. It is basically about designing an effective

integrated marketing mix executed well to

Integrated Marketing


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Integrated Marketing

Ex-BMW launched the modernized MINICooper in 2002, it employed an integratedmarketing strategy in the United States thatincluded a broad mix of media: billboards,

posters, Internet, print, PR, productplacement, and grassroots campaigns.

Relationship marketing


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Relationship marketing

Relationship marketing includes of building mutualsatisfaction with customers & long term relationships withkey parties as well as go through profit of the business.key parties are-

Customers-People those who are the target market for a firm. Channel -Suppliers, distributors

Partner- Dealers, agenciesRelationship marketing involves cultivating the right kind of

Relationship with right kind of groups.Outcomes of Relationship marketing is to create marketing

network which consist of customers, employees, suppliers,

distributors, retailer, agencies and so on.

Ex-Royal Bank of Canada (RBC) has put each of itsroughly 11 million clients into meaningful segments


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roughly 11 million clients into meaningful segmentswhose profitability it can measure.

In the process, it discovered a sizable sub-segmentof customers hidden within its broader categories ofwealth preservers and wealth accumulators.Dubbed snowbirds,

These individuals spent a number of months eachwinter in Florida, where they were experiencingdifficulties establishing credit as well as missing theirCanadian communities, particularly the familiarity of

the French-Canadian accent and fluency in French.To meet their unique needs, RBC created aCanadian banking experience in Florida.


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Societal Marketing


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g Any such marketing activities which are economically

profitable but socially harmful are strictly restrictedunder societal marketing aspect of holistic marketing.

The marketing should not adopt an irresponsiblebehavior towards the society.

Ex-McDonalds promotion of a statewide childhoodimmunization campaign in Oklahoma.

McDonalds sponsorship of Forest (a gorilla) atSydneys Zooa 10-year sponsorship commitment,

aimed at preserving this endangered species

What is Green Marketing?


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g

This stems from how marketer responds to theenvironment. The marketers have been practicingvery environmental destructive activities.

Resource depletion and degradation - Geneticengineering- Pollution- Harmful emissions and

products- health hazards Barriers to Green M- Cost- Technological problems-

less innovation -less commitment and ignorance-considering world as bundle of raw materials for the

benefit of the current generation.

What is ethical Marketing?


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g

Ethical Marketing are the rules of conduct and moralprincipals regulating marketing.

- The limit of Claims/Promises that can be made as toproduct benefits

- Discriminating competing products

- Marketing of products like cigarettes, alcohol

- Limitations in Marketing products to children

- Religious/racially susceptible Brand names and images

- Unaccepted Promotional methods

- Using women in unaccepted manner

- Purposeful deception

-

Relationship Marketing


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p g

Customer retention has

become a major problem inthe competitive world ofbusiness

Relationship Marketing isthe process of creating,

building and managing longterm relationship withcustomers, distributors andsuppliers. Life Time Value ofa customer is emphasizedmore than a value of a

single transaction


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Traditional Marketing is

concerned with theexchanges with customers.

The emphasis was todevelop products that willsatisfy customers and focus

was basically on (single)transaction. Not much effort was kept on

keeping the customer for along time and Life TimeValue was not considered

much.


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Types and Levels of Relationship Transactional approach-Marketer concludes a

transaction of selling a product. The marketer, inoffering the product, is looking for a response.

Transaction based marketing is on individualtransaction

Relationship approach-The concluded transaction isnot the end of a process, but start of a long term

relationship with the customer.


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Benefits of relationship marketing Retaining existing customers is cheaper than getting new

ones Repeat customers are costing less to service as they are

familiar with the company Reduce customer deflection and bad word of mouth

Keep customer databases and service more effectively Small changes in retention rates have large effects on

revenue

Identify and explain the anticipated benefits ofintroducing marketing orientation to an organisation.


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g g g

If a company to be successful in the long run themost important philosophy they should follow is themarketing orientation/ concept

The mere survival of a company in the modernglobalised world depends on how much of customer

satisfaction that it can offer. Therefore the customer focus should be an integral

part of the organisation

All the departments in the company should have an

integrated approach towards satisfying customers

Further it would be able to reduce the


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Further it would be able to reduce thenumber of dissatisfied customers.

Dissatisfied customers will tell others

Research confirms it takes six times ofeffort and cost to make anew customer

than keeping the existing ones. It would make the organisation gain a

competitive advantage

If an organisation can adopt a marketing


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If an organisation can adopt a marketingoriented approach it would be able to get

Increased customer satisfaction Increased customer loyalty

Increased reputation

Increased motivation among staff

Increased market share

Reduction of waste

Combat threats from competitors

Marketing Mangement Specific

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