Marketing is a social & managerial process by which individuals & groups obtain what they need & want

through creating , offering and exchanging products of valve with others. Core concepts of marketing Need , wants & demand Customer Needs Stated needs Real needs Unstated needs Delight needs Secret needs Products( idea, goods& services)

 Value , cost & satisfaction Value Value = Benefits- Costs (Functional benefits + Emotional benefits) (Monetary costs + Time costs + Energy costs + Psychic costs) Exchange & transactions Exchange Transaction Barter Transfer Behavioral

Competition
Brand competition Industry competition Form competition Generic competition

Marketing environment
Task environment Broad environment

Marketing Program
Marketing program Marketing mix

Thus the basic task of Marketing is offering the consumer in such a way that : The offer fulfills the needs of consumer The terms are acceptable & beneficial to the consumer; and All the organizational goals including profits are achieved in the process

A Simple Marketing System

 How do firm make a total offer to the consumer? 1) By choosing the product that would meet the identified needs of the chosen consumer/ consumer groups 2) By performing various distribution functions like transportation, warehousing, channel management etc . 3) By carrying out promotional activities to communicate & promote the product. 4) By using price mechanism . ( The above 4 elements are called marketing mix of the firm)

 The sub elements of Marketing mix: Product:  Product line & range  Design, ,quality, features, model , style, appearance, sizes & warranty of product.  Packaging, types, material & labels  Services presale & after sale  Trade marks  New products

Place
Channels of distribution, Types of intermediaries , Channel policy & design, Location of outlets, Channel remuneration & dealer principal relations. Physical distribution, transportation, warehousing, inventory levels, order processing, etc

Price
Pricing policies Levels of prices, Levels of margins Discounts & rebates Terms of delivery, payment terms, credit terms & installment facilities Resale price maintenance

Promotion
Personal Selling( objectives, level of efforts, quality of sales force level of motivation) Advertisement, media mix, budgets etc. Sales promotion efforts, display, contest, trade promotion.

Marketing management is the process of Planning & executing the conception, pricing, promotion & distribution of ideas, goods & services to create exchanges that satisfy individual & organizational needs.

The Scope of Marketing

Marketing: typically seen as the task of creating, promoting, and delivering goods and services to consumers and businesses.

 Customer Satisfaction is a feeling of pleasure or disappointment resulting from comparing a products performance or outcome in relation to his or her expectations.
Methods of measuring & tracking customer satisfaction levels

Complaints & suggestion systems Customer satisfaction survey Ghost Shopping Lost customer analysis

The New Economy

Substantial increase in buying power A greater variety of goods and services A greater amount of information about practically anything A greater ease in interacting and placing and receiving orders An ability to compare notes on products and services

How business practices are changing

Old economy business beliefs :
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 Overpromise, under deliver

How business practices are changing

Old economy business beliefs : Organize by customer segments Focus on customer lifetime value Look also at marketing scorecard Focus on stakeholders -Everyone does the marketing Build brands through behavior Focus on customer retention and growth Measure customer satisfaction and retention rate Under promise, over deliver

Major drivers of the new economy

Generally, technology, globalization, and market deregulation Specific drivers that emphasize the new economy:
Digitalization and connectivity Disintermediation and reintermediation Customization and customerization Industry union Industry boundaries are blurring rapidly Examples include Kodak (chemicals to electronics), Shiseido (cosmetics to dermatology drugs), Disney (cartoons and theme parks to major films, licensing, retail stores, hotels, cruise ships, and educational facilities) Recognition that new opportunities may be at the intersection of two or more industries

How marketing practices are changing: E-business

The transformation of an organization s processes to deliver additional customer value through the application of technologies, philosophies and computing paradigm of the new economy

How marketing practices are changing: E-business

Three primary processes are enhanced in e-business:
1. Production processes, which include procurement, ordering and replenishment of stocks; processing of payments; electronic links with suppliers; and production control processes, among others; 2. Customer-focused processes, which include promotional and marketing efforts, selling over the Internet, processing of customers purchase orders and payments, and customer support, among others; and

How marketing practices are changing: E-business

3. Internal management processes,
which include employee services, training , internal information-sharing, video-conferencing, and recruiting. Electronic applications enhance information flow between production and sales forces to improve sales force productivity. Workgroup communications and electronic publishing of internal business information are also made more efficient.

How marketing practices are changing: E-business

e-Business refers to any form of transaction (exchange) that uses an electronic medium to facilitate the transaction. e-Business, therefore, can include the following: Internet-based companies that operate wholly through the Internet to conduct their business. Examples are eBay and Amazon. Companies that combine traditional business formats with information on the business provided via the Internet: for example, Ikea. Companies that combine traditional business formats with the opportunity of buying online. Examples include Marks & Spencer, John Lewis, HMV, Tesco and Argos. Companies that collect information on customer profiles and markets and sell this information to interested parties for example Experian and Mintel. Any device used to facilitate exchange, such as 'Chip and Pin' technology, automatic ticketing, electronic ticketing, credit card transactions and so on. Business to business (B2B) activity. Using the opportunities that IT presents to improve the flexibility of working patterns

How marketing practices are changing: E-business

The Benefits of e-Business There are a number of benefits to e-business but in thinking about these benefits it is essential that we make the link back to our definition of marketing in order for the benefits to be fully understood. The benefits can be summarized as: The opportunity to reduce costs of production by reducing overheads - for example, not having a retail outlet in a busy high street location with high rents, reducing stock costs etc The opportunity to increase sales The opportunity to access new markets across the globe The chance to target market segments more effectively Provide more accurate information and improve customer service experience Improves the efficiency of the supply chain Improve employee motivation through more flexible working methods Allowing 24/7 access to the firm's products and services Provides convenience and comfort for customers

How Marketing Practices are Changing

Setting Up Web Sites
Designing an Attractive Website
Seven elements of effective sites

Context Content Community Customization Communication Connection Commerce

Setting Up a Dot-com Presence DotAttracting and Keeping Visitors How can we get more prospects to know and visit our site? How can we use marketing to spread word-of-mouth? How can we convert visitors into repeaters? How do we make our site more experiential and real? How can we build a strong relationship with our customers? How can we build a customer community? How can we capture and exploit customer data for up-selling and cross-selling? How much should we spend on building and marketing our site?

Value chain
Value chain has been proposed by Michael Porter of Harvard

Value chain is a powerful tool for identifying ways to create more customer satisfaction. Every firm do the activities that are performed to design, produce, market, deliver & support its product. The Value chain Identifies 9 value creating activities. 5 primary & 4 Support activities.

Value chain
Value chain has been proposed by Michael Porter of Harvard

5 Primary activities are:

Inbound logistics- The way of bringing material into business Operations- Converting into final products. Outbound logistics- Shipping out final product Marketing- it includes sales Servicing customer.

Value chain
Value chain has been proposed by Michael Porter of Harvard

4 Support activities are Procurement- Buying of various inputs that support primary activities Technology HRM Firm infrastructure- cost of general management, accounting, legal, Govt. affairs. The firms task is to examine its cost & performance in each value creating activity & look for ways to improve it. A firm can look for its competitors performance as a benchmark to improve or to perform better to achieve competitive advantage.

Strategic marketing planning& organization

How do companies compete in global marketplace? . Commitment of crating & retaining satisfied customers. Successful & high performing companies knows how to adopt to continuous changing marketplace
& how to do it calls for Strategic marketing planning-

Strategic marketing planning is a managerial process of developing & maintaining a viable fit between the organizational objectives, skills & resources and its changing marketing opportunities.

Strategic marketing planning & organization

The aim of strategic is to handle or shape the company s business or product that they should yield profits. Strategic planning calls for 3 key areas Managing company s business as an investment portfolio Assessing accurately each business keeping in consideration the market growth rate & company s position in that market. Developing a strategy/game plan for achieving its long term objectives.

Strategic marketing planning & organization Steps involved in the process:

1. Scanning the business environment & spotting the broad business opportunities. 2. Internal scanning of the firm 3. Setting the marketing strategy 4. Formulating the marketing strategy 5. Formulating the detailed functional plans & programmes.

Steps involved in the process:

1. Scanning the business environment & spotting the broad business opportunities.

The main purpose of this exercise is to find out The favorable & unfavorable factors prevailing in the environment The specific business opportunities available to the firm & their relative attractiveness. Four activities are involved in the exercise of environmental scanning Analyzing the environment Analyzing the market & competition Customer Sensing

Steps involved in the process:

1. Scanning the business environment & spotting the broad business opportunities.
Four activities are involved in the exercise of environmental scanning Analyzing the environment The purpose is to locate the opportunities & problem areas . The firm gathers information relating to environment , studies them ,filters them & analyses them. It studies the role of the Govt & impact of Govt policies on its business.

Steps involved in the process:

1. Scanning the business environment & spotting the broad business opportunities.
Analyzing the market & competition

The firm studies the structure of the market & the nature of competition. It studies the leaders in the business, builds up a profile of each of them & studies their programmes & practices & strength & weaknesses. It evaluates their success stories & plots their failures.

Steps involved in the process:

1. Scanning the business environment & spotting the broad business opportunities.
Customer sense

The firm studies the reactions of the customers to the business/product. It studies the motives of the customers & try to locate the cause of their patronage of a particular. It also tries to understand how customer loyalties have shifted over the years & why

Steps involved in the process:

2. Internal scanning of the firm
Defining the mission of the firm: probing what business we are in? Probing the strengths ,distinctive capabilities & limitations of the firm Deciding which of the spotted business opportunities should be pursued by the firm considering its aspiration, capabilities, strengths & limitations. Grouping the diverse business activities of the firm into a few distinct Strategic Business Units. Evaluating the various businesses of the firm vis-a vis the environment, using strategic planning models.

Steps involved in the process: Setting the marketing objectives:

Deciding which business have to be cultivated & nurtured, which ones need a mere maintenance, etc. Laying down the framework of marketing objectives in alignment with the corporate objectives. Pinpointing the key areas in which objectives have to be set . ex- profit, market share, marketing innovations. Assessing the current performance in the key areas. Setting measurable & explicit goals in each key areas.

Steps involved in the process: 4. Developing the marketing strategy:

Selecting the target market

Studying the customer, his profile, characteristics, buying motives Segmentation of the market using relevant bases. Evaluating each of the segments Selecting the appropriate segments as the target market. Developing the marketing mix: Deciding the approach in respect of each of the four Ps Deciding the relative share/ weightage of each element in the total marketing effort.

Steps involved in the process: 5. Formulating the detailed functional plans & programmes.:
Sales forecast Physical distribution plan Channel Plan Advertising & sales promotion plan Sales force plan.

Strategic marketing planning needs extensive MIS

A Marketing Information System consists of people , equipment and procedures to gather ,sort, analyze, evaluate & distribute needed ,timely and accurate information to marketing decision makers. The role of MIS is to assess the managers information needs ,develop the needed information and distribute the information to marketing managers. The needed information is developed through company records ,marketing intelligence activity & marketing research.

Strategic marketing planning needs extensive MIS

An MIS involves a three step process of :
Defining the information needs Organizing the information Analyzing , interpreting and supplying the information

Analytical models employed in Strategic planning

The three most widely used models are1)The Boston Consulting Group s Growth Share Matrix This model is used to identify company s SBU s position in the market. This models identifies the SBU s strength, weaknesses , opportunities & Threats on the basis of market growth rate & relative market share.

BCG Matrix
STAR High
Market growth rate

Question mark

?
COW DOG
High Low

Low

Relative Market Share

BCG Matrix
Star: This category represents the high market share & high industry growth. SBU s in this categories require large investment to defend their position Cash cows: This categories represents the low growth& high market share which is the characteristics of SBU operating in mature industry. Here company needs less investment to hold their position Question mark: This category represents high market growth & low market share.SBU in this requires high investment to bring them to star position. Dogs: SBU s in this category generates less cash for the company as it operates in low growth & low market share. Companies do not invest in this categories & try to divest or liquidate.

SWOT ANALYSIS

Swot analysis helps company to implement its strategies by increasing strengths , overcoming weakness, tapping the opportunities & minimizing the threats. Swot helps company to understand the current position of the company & helps to improve the performance by overcoming the threats & weakness of the company.