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A business exists only for its customers and is as good as its customer base. No wonder, why marketing has been equated as business, in Business is Marketing. Essentially, marketing is related to understanding the whole business phenomenon and evolving strategies for ensuring a feast at market place. The process of marketing initiates with the understanding the needs of customers; getting the feel of their attitudes, beliefs, customs, desires and expectations and finally arriving at rightful solutions for their specific needs. Marketing is thus customer driven, but dont get too engrossed with the your customer and forget the medium of serving them. Take care of your associates and readily gear for market place battle with them to compete with the awful competitors. Marketing, in popular parlance, is predominantly associated with selling. This is a narrow definition of its functions. Its wider role, of identifying the latent needs of customers and satisfying those needs with relevant product/ services, is rarely acknowledged. In other words, marketing serves customers expressed and latent needs with appropriate product/ services at affordable price and accessible selling price, with the right combination of features and benefits. The market response to these efforts is dictated by the extent to which the value proposition is delivered for the costs involved for the customers. The gamut of operations covered by marketing are wide and they include pricing, distribution, advertising, sales promotion and customer relations. Each of these provides ample scope to meet customers expectations with the right value proposition.

Marketing touches all of us everyday of our lives. We enjoy a standard of living that our ancestors could not have visualized. Goods and services that we desire are available for us to purchase at our will, wherever and whenever we need, or we wish to have them. Our fore fathers had to go to great lengths for what we take for granted today. The marketing system has made it all possible. It has given us a standard of living, industrial growth, employment opportunities and economic advancement.
There are only two functions, which generate revenue. These are marketing and innovation. Rests are all costs. PETER F DRUKER

INTRODUCTION Each business organization is unique in its character, personality and operations. But the core objective can be only one, enhancing the shareholders value by generating profits out of operations. A number of activities go into creating a value-added product or service that can be sold at a profit. For actual exchange to take place, these need to be marketed. Marketing is, more often than not, mistaken as advertising or promotion. It is more than just that. Marketing is focusing on all aspects of business with the objective of persuading customers to buy the organizations products.

INTRODUCTION TO MARKETING- Som; MBA 2ND Sem; FoM; GEU

Real marketing does not involve selling what you make, as much as knowing what to make, and offer for sale. It is a philosophy that guides the entire organization to think customer, and do all that everyone in the organizations can do, to deliver superior customer value and customer satisfaction.

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Why do the concepts of marketing become important to functions other than marketing? A successful organization is an integrated system, where all activities are melded to a common objective of achieving the organizations goal. In commercial firm, the goal is generating profit. It takes many functions, disciplines, specializations, skills, resource deployment and efforts for operating an organization. However in final analysis, all activities anywhere in the structure come to fruit only when the customer buys and pays for the goods or services offered for sale, at a price that is profitable for the organization. No single function or effort can ensure that a customer will buy. Sustained customer franchise is necessary, as the successful organization can only be that where customers buy repeatedly and recommend to other prospective customers, generating a regular

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INTRODUCTION TO MARKETING- Som; MBA 2ND Sem; FoM; GEU

turnover. Therefore all functions must focus their activity on providing the customer satisfaction. People through the organization must know the of the basic issues such as: Company strategy on the market segment that it can serve profitably How to position strongly by developing need-satisfying products for chosen target segment. How to price the products to make them attractive and affordable and the basic pricing dynamics. How to manage distribution chain and retailers who make the product available to the customers. Understand the importance of customer relations, building the customer confidence and loyalty, handling customer issues and building organizations image. These issues are fundamental to organizations health, growth and welfare of its people. All in the organization should be working with the customer centric unified approach, in every activity that takes place, in manufacturing, engineering, quality control, warehousing, distribution and in product development, besides in sales and marketing. Firms can adopt different marketing strategies. They can choose to focus on selling what they make to a niche or specific market. A larger horizon can be taken by adopting a marketing approach.

Instead of trying to market what is easiest for us to make, we must find out much more about what the customer is willing to buy we must apply our creativeness more intelligently to people and, and their wants and needs, rather than products.
BASICS OF MARKETING Marketing is business, it undertakes each and every business activity and thus it cannot be undertaken as a merely a functional area of management. In fact, it is the whole business scene not from manufacturers point of view but from the customers contemplation. Essentially marketing is an exchange or a transaction, intended to satisfy human needs and wants. To understand marketing, it is essential to scan the role and impact of marketing on organizational functioning. Marketing can be understood as: Concept Process Managerial function Marketing as a concept Concept of marketing is essentially the concept of customer orientation. Understanding and responding to the customer needs is must for any organization success. It has to continuously determine its competitive advantage and build steps to further augment it. Marketing as a concept involves: a) Customer Orientation b) Competitive Orientation

INTRODUCTION TO MARKETING- Som; MBA 2ND Sem; FoM; GEU

c) The ability to respond to environmental changes. Marketing as a process The process of marketing involves an exchange transaction between the buyer and seller. Hence the origin of marketing can be traced to the barter system of ancient times. Today it has been replaced by monetary system but the actual difference lies in the mutual satisfaction of both the buyer and seller. If the buyer is not satisfied it is selling transaction and if seller is not satisfied it is dumping transaction. Thus, in this transaction the underlying assumption is the satisfaction of the buyer and seller and development of a long-term relation ship between them. Marketing as a Managerial Function Marketing as a managerial activity involves the market opportunities, planning the marketing activities, implementing marketing plans and selling control mechanisms, in such a way that organizational objectives are accomplished at a minimum cost. Thus, marketing is i. Understanding Consumer needs ii. Environment scanning and market opportunity analysis iii. Development of competitive marketing plan and strategy such that an organization is able to satisfy not only the consumer needs but also its objectives. iv. Implementation of marketing plan and development of tactical plans to overcome problems at marketplace; and v. Development of control mechanisms
DEFINITIONS

Marketing is that activity of business, which identifies the needs and wants of target customers, determines which target markets it can serve the best, and design appropriate products, services, and programmes to serve these markets, to meet the ultimate goal of the organization. Marketing is an organizational function and a set of processes for creating, communicating and delivering values to customers and for managing customer relationships in ways that benefit the organization and its stakeholders American Marketing Association Marketing is process of defining anticipating and creating customer needs and wants and of organizing all the resources of the company to satisfy them at greater total profit to the company and to the customer. Philip Kotler Applicably, marketing is seen as a process, consisting of five basic steps that can be represented as: R----- STP----- MM----- I----- C Where R = Research (i.e., market research) STP = Segmentation, targeting and positioning. INTRODUCTION TO MARKETING- Som; MBA 2ND Sem; FoM; GEU 4

MM I C

= = =

Marketing Mix (popularly known as the four Ps, i.e., product, price, place, promotion) Implementation Control (getting feedback, evaluating results, and revising or improving STP strategy and MM tactics)

Effective marketing starts with research, R. Research into a market will reveal different segments, S, consisting of buyers with different needs. The company would be wise to target, T, only those segments which it could satisfy in a superior way. For each target segment, the company will have to position, P, its offering so that target customers could appreciate how companys offering so that target customers could appreciate how the companys offering differs from competitors offerings. STP represents the companys strategic marketing thinking. Now the company develops its tactical marketing mix, MM, consisting of product, price, place, and promotion decisions. The company then implements, I, the marketing mix. The company uses control measures, C, to monitor and evaluate results and improve its STP strategy and MM tactics.
SCOPE OF MARKETING

Scope of marketing can be generalized in following entities: Goods Physical goods constitute the bulk of most countrys production and marketing effort. Services As economies grow the service aspect becomes more prominent. There are goods linked with certain or considerable amount of service or pure service. Experiences By Orchestrating services and goods, one can create, stage, and market experiences. Visiting adventure parks and museums is an experience. Events Marketers promote time bound events like Olympics, ICC Tournaments, Kumbh mela etc. Persons Celebrity marketing is a major business. And artists, musicians, CEOs, physicians, Lawyers, and financiers and other professionals and draw help from celebrity marketers. Places Places too compete to attract tourist, business etc. The growing competition between Bangalore and Hyderabad for IT destination of the country. And Kolkattas earnest to rebuild it as a business center of prominence. Properties Properties are intangible rights of ownership of either real property (real estates) or financial property (stocks, shares and bonds). Properties are brought and sold and this occasions a marketing effort. Organizations Organizations actively work to build a strong favourable image in the minds of their public. By promoting social causes organizations improve upon their images. Universities, colleges and performing art organizations all plans to boost their public image to compete more successfully for audiences and funds. Information Information can be produced or marketed as a product. This is what university, schools produce and distribute at a price to parents, students and communities. Encyclopedias and most non-fiction books market information. Ideas Every market offering includes a basic idea at its core. Like a temple for example must decide whether to market itself as a place of worship or community center.

INTRODUCTION TO MARKETING- Som; MBA 2ND Sem; FoM; GEU

Core Marketing Concepts To understand definition of marketing, we need to look at some interrelated and important terms. Marketing Marketing is a human activity directed at satisfying needs and wants through an exchange process. A marketer is someone seeking a response (attention, a purchase, a vote, a donation) from other party called the prospect. If the two parties are seeking to sell something to each other, they are both marketers.
Marketers & Prospects

Needs are the basic human requirements. We need air, water, food, cloth, and shelter to survive. Wants are needs directed towards specific objects. Like a person requiring food goes for pizza and so food is need but pizza and soft drink is want. So, wants are willingness to purchase certain specific objects. Demands are wants for specific products backed by an ability to pay. Many people want Mercedes but only few are willing and able to buy one. So, marketers should know not only how many are willing to buy their market offering but also actually how many are able to buy it.
Needs, wants & Demands Product or Offering A product is viewed, as something that is capable of satisfying a want. Anything that can be offered to a market to satisfy a need or want is a marketable product. Customer buys a product as it meets a need or a want, or provides a solution to a need, at optimum cost. Products can be seen as not just a physical object, but as something that satisfies a need. This is an important concept, as if something else comes along that meets the objective, and if the solution is more acceptable, customer will consider to switching to the new offering. Value & Satisfaction

The market offering will be successful if it delivers value and satisfaction to the target buyers. The buyer chooses among different offerings on the basis of which is perceived to deliver the most value. Value = Benefits/Costs = Functional Benefits + Emotional Benefits Monetary + Time + Energy + Psychic Cost Cost Cost Cost Marketers can increase the value of customer offering in several ways Raise Benefits Reduce Costs Raise Benefits and Reduce Costs Raise Benefits by more than Raise Costs Lower Benefits by less than reduction in Costs

INTRODUCTION TO MARKETING- Som; MBA 2ND Sem; FoM; GEU

That a want exists, and a product to satisfy the want is available, is not sufficient for marketing activity. When a person decides to satisfy the want through acquisition of the product, a marketing transaction takes place. For a company the ultimate goal is achieved after the customer purchases the goods, and pays an adequate price for value addition. A transaction consists of exchange of values and should be a value creating process for both the parties. Exchange is the core concept of marketing involves obtaining a desired product from someone by offering something in return. For an exchange to take place following conditions needs to be met.
Exchange and Transaction

i. ii. iii. iv. v.

There are at least two parties. Each party has something that must be of value to other party Each party is capable of communication and delivery. Each party is free to accept or reject the exchange offer. Each party believes that it is desirable and appropriate to deal with the other party.

Exchange is a process rather than an event. Two parties are engaged in an exchange if they are trying to come to mutually agreeable terms-negotiations. When an agreement is reached we say a transaction takes place. A transaction involves several dimensions: at least two things of value, agreed upon conditions, a time of agreement, and a place of agreement. Relationship Marketing aims at building long term mutually satisfied relations with key parties-customers, suppliers, and distributors- in order to earn and retain long term business. It builds strong economic, technical, and social ties among the parties thus, cutting on transaction costs and time. Relationship marketing results in building unique company assets called Marketing Network. A Marketing Network consists of company and its supporting shareholders (customers, employees, suppliers, distributors, retailers, Ad and research agencies, Local authorities and law makers and others) with whom it has build mutually profitable business relationships. Increasing competition is not between companies but between marketing networks, with the prize going to the company that has build better networks. The operating principle is simple: Build an effective network of relationships, with key shareholders, and profits will follow.
Relationships and Networks

Marketing management is not just finding enough customers for companys current output. It seeks to affect the level, timing and nature of demand; in a way that helps the organization to achieve its objectives. Marketing management is an analysis, planning, implementation, and control of programmes designed to create, build, and maintain a beneficial trade with objective of achieving organizations objectives.
Marketing Management Segmentation

Needs and tastes of individuals differ and no marketer can really satisfy everyone, as not everyone will like the same Soft Drink, Hotel
& Target Market

INTRODUCTION TO MARKETING- Som; MBA 2ND Sem; FoM; GEU

Room, Restaurant, Automobile, and Movie etc. Marketers divide the markets in various segments, based on certain identity and profile of buyers. The basis of segmentation can be demographic, geographic, psychographic and behavioural differences among buyers. Now, firms can decide which segment presents the greatest opportunity and develop a market offering for that chosen target market. The offering is positioned in the minds of consumer as offering some central benefit(s). For example, Volvo develops its cars for the target market of buyer for whom safety is the major concern. Volvo therefore, positions its cars as the safest a customer can buy.
Market Positioning

Position that a product occupies in consumers mind relative to competition is an important marketing concept. If the product is perceived as being exactly like another product, in the market, consumers will have no reason to buy it.
Brand

A brand is a name, symbol or design that identifies the goods of a seller in customers mind to differentiate it from those of competition. Brand image comes from value associations that remain in customers mind. These come from product, sustained quality delivery, staff, service, innovation, pricing and image developed by honest advertising, and all such activities that are directly or indirectly customer related. Over a period of time, the brand develops its own identity. It is important for the organization to define its business model and what the brand stand for and protect the position through good and bad. Chasing short-term gains by sacrificing brand identity will bring an early demise of brand-image built over years of hard work
Marketing Channels

To reach a target market, the marketer uses three kinds of

marketing channelsa. Communication Channels-It is to deliver and receive messages from target buyers. Includes print media like newspapers, magazines and electronic like radio, television, Internet and outdoors media-billboards, wall paintings, etc. b. Distribution Channels-To display or deliver the physical product or service(s) to the buyer or user. There are physical distribution channels and service distribution channels. They include warehouses, transportation vehicles and various trade channels such as c. Selling Channels-to effect transactions with potential buyers. It includes not only the distributors and retailers but also bank and insurance companies that facilitate transactions. It describes a long chain stretching from raw materials to components to final products that are carried to final buyers. The supply chain represents a value delivery system. Each company captures only a certain percentage of total value generated by the supply chain. When a company acquires competitors or moves upstream or downstream, it aims to capture a higher percentage of supply chain value.
Supply Chains

It includes all actual and potential rivals offerings and substitute a buyer might consider. Competition can be categorized into four levels depending on degree of product substitutability.
Competition

INTRODUCTION TO MARKETING- Som; MBA 2ND Sem; FoM; GEU

a. Brand Competition- A Company sees its competitors as other companies offering a similar product and services to the same customers at similar prices. Maruti Udyog Ltd might for Zen may see Hyundai Santro, Tata Indica ant the like as its competitors. It would not see itself competing itself with Chevrolet or Octavia. b. Industry Competition - A Company sees its competitors as all companies making the same product or class of product. Maruti would see itself as competing with all brands of cars. c. Form Competition-A Company sees its competitors as all companies manufacturing products that supply the same service. MUL would see itself not only competing against automobile manufacturers but also against the manufacturers of Bicycles, Bikes and Trucks. d. Generic Competition- A Company sees its competitors as all companies that compete for the same Consumer Rupee. Maruti would see itself competing with companies that sell major consumer durables, foreign vacations and new homes. It consists of task and broad environment. Task Environment includes the immediate actors involved in producing, distributing and promoting the offering. The main actors are company, suppliers, distributors, dealers and target customers. Broad Environment includes six components: demographic, economic, natural, technological, socio-cultural, and political legal environment that can have a major impact on actors of task environment. So marketers should keenly observe these factors and adjust strategies accordingly.
Marketing Environment Marketing Mix

It is the classified set of marketing tools that the firm uses to pursue its marketing objectives in target market. McCarthy classified these tools into 4 broad groups that he called the 4Ps of marketing: Product, Price, Place, and Promotion. The 4Ps represent sellers view of marketing tools available for influencing buyers. From buyer point of view each marketing tool is designed to deliver customer benefit. Robert Lauterborn suggested that sellers four Ps correspond to customers four Cs.
MARKETING MIX PRODUCT
PRODUCT VARIETY QUALITY DESIGN FEATURES BRAND NAME PACKAGING SIZES SERVICES WARRANTIES RETURNS

PRICE
LIST PRICE DISCOUNTS ALLOWANCES PAYMENT PERIODS CREDIT TERMS

PROMOTION
SALES PROMOTION ADVERTISING SALES FORCE PUBLIC RELATIONS DIRECT MARKETING

PLACE
CHANNELS COVERAGE ASSORTMENTS LOCATIONS INVENTORY TRANSPORT

FIG: THE 4 COMPONENTS OF MARKETING MIX

INTRODUCTION TO MARKETING- Som; MBA 2ND Sem; FoM; GEU

FOUR Ps Product Price Place Promotion

FOUR Cs Customer Solution Customer Price Convenience Communication

FOUR As Acceptability Affordability Availability Awareness

Winning Companies will be those that meet the customer needs economically and conveniently and with effective communication. This implies that a product is customer solution, which should be acceptable to target market; price should be customer price that makes the offering affordable; it should be available at convenience and promotion should be a communication to initially create awareness. The extended version of the marketing mix has been transformed into 8 Cs, which are listed below:
FOUR Ps Product Price Place Promotion Personnel Physical Facilities Process Productivity FOUR Cs Customer Solution Customer Price Convenience Communication Competence Comfort Configuration Contraction

COMPANY ORIENTATION TOWARDS MARKET PLACE

Marketing Management has been defined as a conscious effort to obtain desired exchange outcomes with target markets. A company may take any of the 5 competing concepts
The Production Concept

Production Concept holds that consumers will prefer products that are widely available and inexpensive. Such firms concentrate on achieving high production efficiency, low costs and mass distribution believing that consumers are primarily interested in obtaining the products at lower prices. This concept is mainly used in developing countries where availability of product and not its features is major concern for of the customers. Also companies going for market expansion concentrate on this concept.
The Product Concept

Product Concept holds that consumers will prefer those products that offer most quality, performance or innovative features. The focus is on making superior products and improving them overtime assuming that buyers admire well made products and appraise quality and performance. But these companies should focus on better satisfaction of customer needs not in love affair with their product.
The Selling Concept

Selling Concept holds that consumers and business, if left alone will not buy enough of organizations product. The organization must, therefore, undertake an aggressive selling and promotion effort. INTRODUCTION TO MARKETING- Som; MBA 2ND Sem; FoM; GEU

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Selling concept assumes that consumer typically show buying inertia or resistance and must be coaxed in buying. It assumes that company has a whole battery of effective selling tools, promotion tools to stimulate more buying. Selling concept is practiced more aggressively with unsought goods, goods that buyers generally do not think of buying such as insurance, encyclopedias and for fund raising, political fund etc.
The Marketing Concept

Marketing Concept holds that key to achieving its organizational goals consists of company being more effective than competitors in creating, delivering and customer value to its chosen target markets. The marketing concept rests on 4 pillars: target market, customer needs, integrated marketing, and profitability.
Target Market Customer Needs

Companies do best when they chose their target Market(s) carefully and prepare tailored marketing programmes.

Understanding customer needs is complex. Customer may have needs of which they are not fully conscious or they cannot articulate these needs. Needs can be of 5 types a) Stated needs (the customer wants an inexpensive car) b) Real needs (the customer wants a car whose operating cost, not its initial price is low) c) Unstated needs (the customer expects good service from the dealer) d) Delight needs (the customer would like to include a gift of free fuel for first 1000kms) e) Secret needs (the customer wants to be seen by friends as savvy customer) Companies should look out at not at just fulfilling customers need but providing a solution that satisfies the consumers and help in its retention. When all departments of the company work together to serve customer interest, the result is integrated marketing.

Integrated Marketing

But it is difficult task for every department may be looking forward at their own point of view-cost or production. Integrated Marketing is an effort to vindicate this difficulty. Integrated Marketing may take place at two levels - Within the marketing department - With all the departments In order to develop teamwork, the company carries out internal marketing as well as external marketing. Integrate marketing precedes external marketing and involves hiring, training, or motivating able employees who want to serve customer well. External marketing is directed towards people outside the company.

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Profitability

The ultimate purpose of marketing concept is to help organizations achieve their objectives. Private firms major objective is profits. But non-profit and public organizations major are to attract enough funds to perform useful works.

Marketing Concept is not widely practiced, but i. Sales Decline, ii. Slow Growth, iii. Changing Buying Patterns, iv. Changing Buying Patterns, v. Increasing Competition, vi. Increasing Marketing Expenditures has resulted in more and more organizations adopting it.
Societal Marketing Concept

Societal marketing concept holds that the organizations task is to deliver the needs, wants and interests of the target market and to the desired satisfaction more effectively and efficiently than competitors in a way that preserves or enhances the consumers or societies well being.

The societal marketing concept calls upon marketers to build social and ethical considerations.
ROLE OF MARKETING IN MODERN ORGANIZATIONS

From above discussions, we observe that the role in modern organizations is that of integrating the needs and wants of customers of other organizational functions like production, R&D, finance, personnel etc. Examples of todays companies shows that neither marketing nor any other function holds key for success. Rather all are important. Only one thing that comes out is that marketing performs the role of integration. This is shown in figure below Integrative function of Marketing An interesting feature of successful marketing companies is the integration of objectives of all corporate functions in a way that synergy is obtained. This is important in todays competitive environment because the responsibility to market the product and also to expand/maintain rests on every individual of the organization. Today there is no problem, which is purely marketing or production. Rather, each is total business problem requiring an integrative solution. As shown in figure below each division objectives flow from corporate objectives and influence other divisions objective formulation.
Marketing Offer

One of the major objectives of an organization is to become market leader. This applies not only to companies, but also even to non-profit organizations (educational institutions, hospitals, NGOs etc.). To be able to achieve this objective, it is important that these organizations be able to assemble their market offer called marketing mix or 4Ps of marketing i.e., Product, Price, Place, and Promotion. INTRODUCTION TO MARKETING- Som; MBA 2ND Sem; FoM; GEU 12

Marketing mix is dependent upona. Marketing Environment of the Organization b. Marketing Objective of the Organization c. Its resource position; and d. Its Marketing Organization Structure and Information System.
Marketing Tasks

It is generally believed that demand generation for a product is just one of the several tasks of a marketing manager. In fact, the task of the manager is to match the demand with supply position of the company. Failing to do so may prove disastrous for marketing manager. Only one thing that comes out is that marketing performs the role of integration. This is shown in figure below

PRODUCTION

R&D

MARKETING

CUSTOMER

FINANCE

PERSONNEL

FIG: INTEGRATIVE ROLE OF MARKETING

INTRODUCTION TO MARKETING- Som; MBA 2ND Sem; FoM; GEU

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CORPORATE GOALS

MARKETING OBJECTIVES

R&D OBJECTIVES

PRODUCTION OBJECTIVES

FINANCE OBJECTIVES

PERSONNEL OBJECTIVES

FIG: INTEGRATION ROLE OF MARKETING OBJECTIVES WITH OTHER DEPARTMENTS OBJECTIVES Example A hotel marketer on a hill station may be faced with an irregular demand-excessive during the season and hardly any occupant during off-season. S/he thus has to promote the hotel during off season by offering off season discounts on rooms and food tariffs, organizing special events to attract tourists, promoting it as a conference venue, etc. Oil major is faced with an ever-increasing demand. The marketer here has to demarket oil by educating motorist on the importance of conservation of oil.

Thus, the major task of marketer is essentially management of demand, given his/her organizations and industry constraints. Marketing and Selling The view that marketing and selling are same is commonly held confusion. Selling, of course, is part of marketing, but marketing includes much more than selling. As Peter Drucker observed, The aim of marketing is to make selling superfluous. What Drucker means is that the marketers task is to discover unmet needs and to prepare satisfying solutions. When marketing is successful, people like the new product, word of mouth spreads fast, and little selling is required. Marketing cannot be equivalent to selling because it starts long before the company has a product. Marketing is a homework that managers undertake to access to needs, measure their extent and intensity, and determine whether a profitable opportunity exists. Selling exists only after a product is manufactured. Marketing continues throughout the products life, trying to find out new customers, improve product appeal and performance, learn from product sales results, and manage repeat sales. Marketing expenditure unlike selling is an investment, not a cost. Whereas selling emphasizes on short-term gains, marketing is tuned to congregate long-term goals.

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STARTING POINT
FACTORY . .

FOCUS
PRODUCTS

MEANS
SELLING & PROMOTING

ENDS
PROFITS BY SALES VOLUME

THE SELLING CONCEPT STARTING POINT

TARGET MARKET .

FOCUS
CUSTOMER NEEDS

MEANS
INTEGRATED MARKETING

ENDS
PROFITS BY CUSTOMER SATISFACTION

THE MARKETING CONCEPT

4566789 @8A B@CD5E789 FG8F5HE4 I A7PP5C58F5 78 @HHCG@FQ

FOCUS MEANS END

Selling Concept Marketing Concept

Products Customer Needs

Selling & Promoting Integrated Marketing

Profits through Sales Volume Profits through Customer Satisfaction

Marketing
1. Focuses on Customers Needs. 2. Customer enjoys supreme importance. 3. Product planning and development to match products with markets. 4. Integrated approach to achieve long-term goals. 5. Converting customer needs into products. 6. Caveat vendor (let the seller beware) 7. Profits through customer satisfaction.

Vs.

Selling

1. Focuses on Sellers Needs. 2. Product enjoys supreme importance. 3. High pressure selling to sell goods already produced. 4. Fragmented approach to achieve immediate gains. 5. Converting products into cash. 6. Caveat emptor (let the buyer beware) 7. Profits through sales volume.

RECENT INNOVATIONS IN MARKETING

1. Social Marketing- This is a new concept developed very recently. In fact, it is the broadening concept explained earlier. During 1960s two opposite views on marketing emerged. The first one viewed the marketing as a tool that should be used to justify as well as stimulate unbounded consumption and self-indulgence (William Lazer). Philip Kotler, Gerald Zatman, etc. developed the second view, which argue that marketing must develop a social consciousness. In other words, marketing must become involved in vital issues and provide important public services. The basic

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marketing concepts applicable to first view however cannot be applied to nonbusiness organizations such as hospitals or governmental units. Social marketing concept is a management orientation aimed at generating customer satisfaction and long-run consumer and public welfare as key to satisfying organizational goals and responsibilities. Philip Kotler Thus, the application of marketing theories and techniques to social situations is called Social Marketing. As mentioned above, social marketing is a part of the broadened marketing concept. Marketing of family planning concept is an appropriate concept in this regard. Elements of Social Marketing a) Satisfaction of Human Needs- Though the business-marketing concept is also ultimately the satisfaction of human needs; its stress is always on the business or product. In social marketing the marketing techniques are directed towards the attainment of satisfaction of human needs. In other words, business marketing always tends to identify consumer-self interest and determine how to reach it. But the advocates of social marketing are against this approach. According to them, the technique must be used for achieving societys satisfaction as a whole, e.g., selling water, housing facilities, etc. b) Extension of Ideas on Marketing to Social Fields- It is argued that marketing should be used as an instrument to achieve the goals of the society. For instance, marketing techniques can help in attaining socially desirable goals, such as population control and increased education. c) Consideration of Social Impact- It is argued that a business must be assessed not only on the profitability aspects but also on the overall efforts or the actions of the business on the society. 2. Demarketing- The role of marketing and the strategies under conditions of scarcity and during the periods of shortage has received considerable attention recently. Accordingly, Kotler and Levy have coined the new concept, Demarketing, a situation which may come about as a result of temporary shortages occasioned by short-term excess demand for a companys products. Marketers task is not blindly to seek increase in sale; rather it is shape to demand to conform to long run objectives. Thus, demarketing is that aspect of marketing that deals with discouraging customers in general or certain class of customers in particular on either a temporary or permanent basis. Demarketing has become the declared policy of an increasing number of oilexporting countries. The reasons arei. Greater revenues. ii. Conservation of resources. iii. Speedy development of alternative sources of supply. iv. More controls and powers. v. Political gains.

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The similar situations arose in past also. For instance, in the case of Kodak Instant Camera (1960), Wilkinson Sword Stainless Steel Blades (1960), in which there was contraction of investment. As a result, these companies had to de-implement the marketing concept. Thus, demarketing is the marketing concept in reverse. 3. Re-marketing- Remarketing takes the form of finding or creating new users for an existing product. For example Nylon, which originally had an end use for making cloth and hosiery. Baking soda now finds uses as cleaning and deodorizing agent, etc. Thus, in real sense marketing is a method by which a new type of satisfactions is created for old products. While demarketing is opposite to marketing concept, remarketing creates new satisfaction for the consumer. Hence, the latter keeps the same logic of the modern consumer-oriented marketing concept. 4. Over-marketing- Over-marketing constitutes the striving by a firm to generate increased sales while neglecting quality control, production efficiency and/or cash flow management. An example of over-marketing is found in auto industry. Since the advent of Japanese imported cars, American auto companies escalated advertisements to protect themselves from foreign competition. By neglecting to make the car more fuel efficient, quieter and less susceptible to repairs, they failed to take advantage of growth opportunities. 5. Meta-marketing-Eugene J. Kelly developed this term. According to him, it is the synthesis of all managerial, traditional, scientific, social and historical foundations of marketing and includes specialization on the interrelationships of mental and physical processes to supplement the facts and empirical observations of marketing practice. The word meta is being used to mean beyond as in metaphysics. This concept is developed, as the marketing appears to be moving towards broader horizons. The concern of meta-marketing is to focus all scientific, social, ethical, and managerial experience on marketing. FORCES AFFECTING MODERN MARKETING Of all the forces affecting modern marketing, perhaps none is more important than globalization. Since the 1980s, technological advances such as global telephone and computer networks have reduced geographic and even cultural distance. As a result, companies can now buy supplies and produce and sell goods in countries far from their home offices. Products conceived in one country are now being manufactured and then sold in many others. For example, Sony (Japan), Nestl (Switzerland), Bic (France), and Volkswagen (Germany) have become household words around the world. Although being able to market goods far from home presents corporations with many new opportunities, it also means they face new competition. Local companies that never even considered international competition now find foreign competitors stocked on shelves right alongside their own products. Some economists argue that local companies should be protected from such competition through legislation that regulates the flow of

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goods through trade barriers and other measures. Others oppose such regulation, arguing that it only raises prices for consumers. See also Free Trade. Globalization, however, is only one force changing the way companies market their products or services. Another involves changes in the very interests and desires of consumers themselves. Consumers today are more sophisticated than those of past generations. They attend school for a much longer period of time; they are exposed to newspapers, magazines, motion pictures, radio, television, and travel; and they have much greater interaction with other people. Their demands are more exacting, and their taste changes more volatile. Markets tend to be segmented as each group calls for products suited to its particular tastes. Positioning the productthat is, determining the exact segment of the population that is likely to buy a product, and then developing a marketing campaign to enhance the products image to fit that particular segment requires great care and planning. This type of campaign is known as target marketing. Competition also has sharply intensified, as the number of firms engaged in producing similar products has increased. Each firm tries to differentiate its products from those of its competitors. Profit margins, meaning the profit percentages made by a business per dollar of sales, are constantly being lessened. Although costs continue to rise, competition tends to keep prices down. The result is a narrowing spread between costs and selling prices. An increase in a businesss sales volume is necessary to maintain or raise profit. Another force affecting modern marketing is the influence of the consumer rights or consumer protection movement. This movement insists on safe, reputable, and reliable products and services. Both consumer groups and government agencies have intensified their scrutiny of products, challenging such diverse elements as product design, length and legitimacy of warranty, and promotional tactics. Warranty and guarantee practices, in particular, have been closely examined. New legislation has generally defined and extended the manufacturers responsibility for product performance. Environmental concerns have also affected product design and marketing, especially as the expense of product modification has increased the retail cost. Such forces, which have added to the friction between producer and consumer, must be understood by the marketer and integrated into a sound marketing program. Even the way a firm handles itself in public lifethat is, how it reacts to social and political issueshas become significant. No longer may a corporation cloak its internal decisions as private affairs. The publics dissatisfaction with the actions and attitudes of a firm has sometimes led to a reduction in sales; conversely, consumer enthusiasm, generated by a firms intentional establishment of a good public image or public relations, has led to increased sales. SPECIALIZED MARKETING DEVELOPMENTS The success of specialized marketing developments has caused many older organizations to revise their operating methods. In recent years, for example, franchise distribution has

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become an important force in retailing. Under this plan, the retailer is given the right to sell, within a certain area, without competition from another retailer dealing in the same product. Many consumers now find it more desirable to rent products than to purchase them outright. For example, a homeowner may find it preferable to rent an electric floor polisher when needed, rather than purchase the appliance at the list price, use it only infrequently, and then have to provide storage space within the home. Another item consumers have found easier and less expensive to rent is the automobile. The renting of equipment also figures in large industry. Corporations are finding it to their economic advantage to rent computers and office and industrial machinery, thereby assuring themselves of product servicing and repair and allowing a changeover, without great expense, to newer equipment models as they become available. Businesses must strive daily to outdo competitors. The methods available to businesses for distinguishing their commodity from others in the market are subject only to their ingenuity. Such methods may include product improvement, a unique promotional campaign, a new twist in servicing, a change in distribution channels, or an enticing price adjustment. THE MARKETING PROFESSION As marketing has become increasingly more complex, a need has arisen for professional marketers trained in the social sciences that also possess statistical, mathematical, and computer backgrounds. Many colleges and universities now have programs designed to train marketing executives. Courses are offered at the undergraduate and the graduate level in such specialized fields as advertising, administrative practices, financial management, production, human relations, retailing, and personnel administration. In recent years, as many U.S. manufacturing industries such as steel and automobiles have been weakened because of foreign competition, marketing departments have become increasingly responsible for generating profitable sales volume. Thus, their stature in top-level business decision-making has been enhanced. This trend gives every indication of continuing in the foreseeable future. As competition continues to increase and businesses become even more diversified, the marketing profession is likely to provide more personnel in the ranks of top management.

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