Introduction to Marketing Management

Chapter - 1

Definitions of marketing
Marketing is the management process that identifies, anticipates and satisfies customer requirements profitably
The Chartered Institute of Marketing

What is Marketing?
Social definition A societal process by which individuals and groups obtain what they need and want through creating, offering and freely exchanging products and services of value with others

What is Marketing?
Management definition It is the process of planning and executing the conception, pricing, promotion and distribution of ideas, goods and services to create exchanges that satisfy individual and organizational goals.

Marketing is the human activity directed at satisfying human needs and wants through an exchange process Kotler 1980

The right product, in the right place, at the right time, and at the right price Adcock et al

Marketing is a social and managerial process by which individuals and groups obtain what they want and need through creating, offering and exchanging products of value with others Kotler 1991

Competition
Potential and rival substitutes and offerings a buyer might consider. Competition can be viewed in various perspectives brand, industry, form, generic

Marketing Environment
Competition Customers Govt. policies Suppliers Trade Product Import tariffs Trends Technology Politics

Marketing Mix
It is the tools that an organization employs to pursue its marketing objectives in the target market Product, Price, Place, Promotion 4 Cs Customer solution, Cost, Convenience, Communication

Needs and Wants

Needs are basic human requirements Wants are needs directed to specific objects/services that might satisfy the need

Product
A product is any offering catered to satisfy needs and wants. A brand is when the product is from a known source.

Demand
This is the wants for specific products backed by an ability to pay.

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?

The Marketing Concept

Consumer orientation
Satisfy the customer (CRM) Must do research to know customer wants/needs

Goal orientation
Do long range planning Set objectives (market share, long run profit)

Systems orientation
Diverse units integrated (e.g., new product development)

The 4 Ps & 4Cs

Marketing Mix Product Customer Solution Convenience Place

Price Customer Cost

Promotion Communication

Difference Between - Sales & Marketing ?

Sales
trying to get the customer to want what the company produces

Marketing
trying to get the company produce what the customer wants

Core Concepts of Marketing

Based on : Needs, Wants, Desires / demand

Products, Utility, Value & Satisfaction

Exchange, Transactions & Relationships

Markets, Marketing & Marketers.

Scope What do we market

Goods Services Events Experiences Personalities Place Organizations Properties Information Ideas and concepts

In order to understand Marketing let us begin with the Marketing Triangle

Customers

Company

Competition

Who is a Customer ??
CUSTOMER IS . . . . .
Anyone who is in the market looking at a product / service for attention, acquisition, use or consumption that satisfies a want or a need

Customer
CUSTOMER has needs, wants, demands and desires Understanding these needs is starting point of the entire marketing These needs, wants arise within a framework or an ecosystem Understanding both the needs and the ecosystem is the starting point of a long term relationship

CONTENTS of MARKETING PLAN

Business Mission Statement Objectives Situation Analysis (SWOT) Marketing Strategy Target Market Strategy Marketing Mix
Positioning Product Promotion Price Place Distribution People Process

Implementation, Evaluation and Control

The Marketing Process

Business Mission Statemen t Objective s Situation or SWOT Analysis

Marketing Strategy
Target Market Strategy

Marketing Mix
Product Promotion Place/Distribution Price

Implementation Evaluation, Control

The marketing concept

choosing and targeting appropriate customers positioning your offering interacting with those customers controlling the marketing effort continuity of performance

Competition
Potential and rival substitutes and offerings a buyer might consider. Competition can be viewed in various perspectives brand, industry, form, generic

Marketing Environment
Competition Customers Govt. policies Suppliers Trade Product Import tariffs Trends Technology Politics

Product Items, Lines, and Mixes

Product Item A specific version of a product that can be designated as a distinct offering among an organizations products.

Product Line

A group of closely-related product items.

Product Mix

All products that an organization sells.

Product Mix
Width how many product lines a company has
Length how many products are there in a product line Depth how many variants of each product exist within a product line Consistency how closely related the product lines are in end use

The Give and Get of Marketing

What Changed in Marketing

Old Economy
Organize by product units Focus on profitable transactions Look primarily at financial scorecard Focus on shareholders Marketing does the marketing Build brands through advertising Focus on customer acquisition No customer satisfaction measurement Over-promise, under-deliver

New Economy
Organize by customer segments Focus on customer lifetime value Look also at marketing scorecard

Focus on stakeholders Everyone does the marketing Build brands through performance Focus on customer retention Measure customer satisfaction and retention rate Under-promise, over-deliver

Marketing Mix
It is the tools that an organization employs to pursue its marketing objectives in the target market Product, Price, Place, Promotion 4 Cs Customer solution, Cost, Convenience, Communication

Successful marketing requires:

Profitable Offensive (rather than defensive) Integrated Strategic (is future orientated) Effective (gets results) Hugh Davidson 1972

Marketing management process

Analysis/Audit - where are we now? Objectives - where do we want to be? Strategies - which way is best? Tactics - how do we get there? (Implementation - Getting there!) Control - Ensuring arrival

Why is marketing planning necessary?

Systematic futuristic thinking by management better co-ordination of a companys efforts development of performance standards for control sharpening of objectives and policies better prepare for sudden developments