rof kk ML1 Inst|tute of Management eM8A

Marketing Management- Sem I

MarkeLlng ManagemenL
LM8A [ ML1
(eempowered)
rof 8a[kamal andey (8k)
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
ore onLenL
Module 1 MarkeLlng lundamenLals
Module 2 MarkeL Cfferlngs
Module 3 MarkeLlng lnslghLs
Module 4 MarkeLlng SLraLegles
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
Module 1 MarkeLlng lundamenLals
1a ore oncepLs
1b MarkeLlng
1c lmporLance of MarkeLlng
1d LvoluLlon of MarkeLlng
1e Selllng v/s MarkeLlng
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
1he alm of markeLlng should be Lo
undersLand and saLlsfy Lhe consumer's acLual
need Lo opLlmum
klshore 8lyanl
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
onsumer roducL
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
ore oncepLs
needs WanLs and uemand*
-eeds are Lhe baslc human requlremenLs eople need alr food waLer cloLhlng
and ShelLer Lo survlve eople also have sLrong needs for recreaLlon educaLlon and
enLerLalnmenL
1hese needs become Jants when Lhey are dlrecLed Lo speclflc ob[ecLs LhaL mlghL
saLlsfy Lhe need
emands are wanLs for speclflc producLs backed by an ablllLy Lo pay
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
ore oncepLs
roducL and onsumer
roducL Any offerlng whlch possess an ablllLy Lo fulflll Lhe baslc need of an
lndlvldual
onsumer Any lndlvldual who has propenslLy Lo consume and wllllngness Lo pay
MarkeL
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
ore oncepLs
MarkeL
1radlLlonally a markeL" was a physlcal place where buyers and sellers gaLhered
Lo buy and sell goods
1he concepL of a market ls any sLrucLure LhaL allows buyers and sellers Lo exchange
any Lype of goods servlces and lnformaLlon
A markeL conslsLs of cusLomers suppllers and channels of dlsLrlbuLlon and
mechanlsms for esLabllshlng prlces and effecLlng LransacLlons lor example Lhe
sofLdrlnk markeL comprlses Lhe manufacLurers boLLlers dlsLrlbuLors reLallers
resLauranLs and consumers
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
ore oncepLs
key MarkeLs
onsumer Markets ompanles selllng mass consumer goods and servlces such as
sofL drlnks cosmeLlcs alr Lravel and shoes spend a greaL deal of Llme Lrylng Lo
esLabllsh a superlor lmage Much of a company's sLrengLh depends on developlng
a superlor producL and packaglng dlsLrlbuLlon and communlcaLlons and afLer sales
servlces
8us|ness Markets 1he pracLlce of companles lncludlng commerclal buslnesses
governmenLs and lnsLlLuLlons faclllLaLlng Lhe sale of Lhelr producLs or servlces Lo
oLher companles or organlzaLlons LhaL ln Lurn resell Lhem use Lhem as
componenLs ln producLs or servlces Lhey offer or use Lhem Lo supporL Lhelr
operaLlons
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
ore oncepLs
key MarkeLs
oba Markets ompanles selllng goods and servlces ln Lhe global marekL place
face addlLlonal declslons and challenges 1hey musL declde whlch counLrles Lo
enLer how Lo enLer how Lo prlce and how Lo adapL Lhelr communlcaLlons
Marketpaces and Marketspaces
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
ore oncepLs
MarkeLers
A markeLer ls someone who seeks a response aLLenLlon a purchase a voLe
from anoLher parLy called Lhe prospecL
MarkeLer are lndeed skllled aL sLlmulaLlng demand for Lhelr company's producLs
MarkeLer's are responslble for demand managemenL
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
ore oncepLs
WhaL ls MarkeLed ?
Coods Servlces
LvenLs
Lxperlence
ersons laces
roperLles
CrganlzaLlons
lnformaLlon ldea
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
MarkeLlng
Managers someLlme Lhlnk of markeLlng as Lhe arL of selllng producLs"
Powever Selllng ls noL Lhe mosL lmporLanL parL of markeLlng ! Selllng ls only Lhe
Llp of Lhe markeLlng lceberg
AMA deflnes Market|ng |s an organ|zat|ona funct|on and a set of process for
creat|ng commun|cat|ng and de|ver|ng vaue to customers and for manag|ng
customer reat|onsh|ps |n ways that benef|t the organ|zat|on and |t's
stakehoders"
MarkeLlng ls all abouL ldenLlfylng and meeLlng human and soclal* needs proflLably
Soclal needs dellverlng a hlgher sLandard of llvlng
8reakLhrough MarkeLlng 1A1A AL
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
MarkeLlng
MarkeLlng ManagemenL 1he arL and sclence of
chooslng LargeL markeL* and geLLlng keeplng
and growlng cusLomers Lhrough creaLlng dellverlng
and communlcaLlng superlor cusLomer value
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
lmporLance of MarkeLlng
llnanclal success ofLen depends on markeLlng ablllLy llnance operaLlons
accounLlng and oLher buslness funcLlons wlll noL really maLLer lf Lhere lsn'L
sufflclenL demand for producLs and servlces so Lhe company can make proflL
Many companles have creaLed a hlef MarkeLlng Cfflcer ( MC ) Lo puL markeLlng
on a more equal fooLlng wlLh oLher level execuLlves such as LC and lC
MarkeLlng also helps ln bulldlng brands a loyal cusLomer base lnLanglble asseLs
LhaL make up a large percenLage of Lhe value of a flrm
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
lmporLance of MarkeLlng
Manufacturer ] roducer
1he MarkeLlng helps Lo bulld loyalLy for Lhe producL among Lhe cusLomers 8rand loyal cusLomers
are a source of repeaL sales
A MarkeLlng enables a company Lo bulld a repuLaLlon for lLs producLs and creaLes an lmage ln Lhe
publlc mlnd
lL faclllLaLes Lhe lnLroducLlon Lo new producLs ln Lhe markeL
MarkeLlng ls necessary for boosLlng sales and creaLlng a demand for Lhe producL among Lhe
cusLomers ln a selecLlve manner
A MarkeLlng dlsLlngulshes and dlfferenLlaLes a producL from Lhe goods of compeLlng companles
MarkeLlng asslsLs ln Lhe malnLenance of a proper conLrol over Lhe prlce quallLy and oLher
feaLures of Lhe producL
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
lmporLance of MarkeLlng
onsumer ] ustomer
MarkeLlng dlsLlngulsh and dlfferenLlaLe Lhe goods of dlfferenL manufacLurers and Lhls facL
enables Lhe consumers Lo choose Lhelr producLs effecLlvely
1he markeLed goods assure a cerLaln quallLy and sLandard whlch ls an conslsLenLly
malnLalned by Lhe producer
erLaln markeLed goods acqulre a greaL popularlLy 1he cusLomer buylng Lhese goods derlves
Lhe lmmense saLlsfacLlon of presLlge and sLaLus
lor Lhe cusLomer shopplng becomes easy and pleasurable especlally lf he has developed
brandloyalLy
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
Marut| Small Slze affordable four wheeler
h||ps World wlde leader ln uurables
Mconads MarkeL Leader ln lasL food organlzed chaln of ouLleLs
-|rma Leadlng Washlng powder
-|ke 8esL Shoe wear
Appe lod Muslc layer
lmporLance of MarkeLlng
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
LvoluLlon of MarkeLlng
1hls Loplc baslcally descrlbes whaL has been ompany's ( MarkeLer's ) orlenLaLlon
Lowards MarkeLplace
So leLs revlew Lhe evoluLlon of earller markeLlng ldeas
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
LvoluLlon of MarkeLlng
8A!A!
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
LvoluLlon of MarkeLlng
roducLlon oncepL
lL holds LhaL consumer wlll prefer producLs LhaL are wldely avallable and
lnexpenslve 1hey concenLraLe on achlevlng hlgh producLlon efflclency low cosLs
and mass dlsLrlbuLlon
roducL oncepL
lL holds LhaL consumer favor producLs LhaL offer Lhe mosL quallLy performance or
lnnovaLlve feaLures 1hey concenLraLe on maklng superlor producLs and lmprovlng
Lhem over Llme
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
LvoluLlon of MarkeLlng
Selllng oncepL
lL holds LhaL consumers lf lefL alone won'L buy enough of Lhe organlzaLlon's
producLs 1he organlzaLlon musL Lherefore underLake an aggresslve selllng and
promoLlonal efforL
MarkeLlng oncepL
lnsLead of a producL cenLrlc Make and sell" phllosophy buslness shlfLed Lo a
cusLomer cenLrlc Sense and respond" phllosophy
1he [ob ls noL Lo flnd rlghL cusLomers for your prodcuLbuL Lo flnd Lhe rlghL prodcuL
for your cusLomer
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
Selllng v/s MarkeLlng oncepL
e|ng
Lmphasls ls on Lhe producL
ompany flrsL makes Lhe producL and Lhen
flgures ouL how Lo sell lL
ManagemenL ls salesvolumeorlenLed
lannlng ls shorLrunorlenLed ln Lerms of
Loday's producLs and markeLs
SLresses needs of seller
Alms aL selllng more volumes
Market|ng
Lmphasls ls on cusLomers' wanLs
ompany flrsL deLermlnes cusLomers' wanLs
and Lhen flgures ouL how Lo make and
dellver a producL Lo saLlsfy Lhose wanLs
ManagemenL ls proflLorlenLed
lannlng ls longrunorlenLed ln Lerms of
new producLs Lomorrow's markeLs and
fuLure growLh
SLresses wanLs of buyers
8ullds proflLable relaLlonshlps
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
Pow Should a 8uslness be ueflned?
ompany roductCr|ented Answer MarketCr|ented Answer
kodak We make cameras and fllms We help preserve beauLlful
memorles
Lakme We make cosmeLlcs ?
volLas A We make As ?
xerox We make phoLocopylng machlnes ?
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
Market|ng
Cr|entat|on
n
aes
Cr|entat|on
n
roductor|entat|on
n
Lmphas|zes ony on
roduct
roduct|onor|entat|on
n
e what |t's easy
to produce
Longrun customer
sat|sfact|on
CrlenLaLlon 1owards MarkeL lace
ush products to
beat compet|t|on
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
ro[ecL
eta|s
1ota Marks 20 M
Aocat|on onLenL 12 M ( 6 M each for Pardcopy 1)
ommn / ordn 7 M
ALLlre 1 M
1|me L|m|t 20 mlns per Croup
1eam needs Lo dlvlde Lhemselves lnLo 2 subgroup resenLaLlon
Croup / CA Croup conslsLlng of equal number of sLudenLs
Loglcal valld CuesLlons from sLudenLs wlll be appreclaLed
Marks WelghLed Average of lndlvldual scores
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
ro[ecL
arle C
Mahlndra Mahlndra
adbury's
8lslerl
epsl
8rlLannla
Aslan alnLs
Codre[
8a[a[
8lg 8azzar
lll 8ank
l1 e houpal
C1L
Suzlon
ro[ecL ShakLl
Marlco
LC
oke
Amul
vldeocon
ercepL lcLures
aramounL Alrways
Lbay
Lureka lorbes
eaL 1yres
8lrla ower
uabur
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
Module 2 MarkeL Cfferlngs
2a 1ypes of MarkeLlng
2b Levels of MarkeLlng
2c AcLlvlLles of MarkeLlng MarkeLlng Mlx
2d S1
2e roducL Llfe ycle ( L)
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
1ypes of MarkeLlng
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
8elaLlonshlp MarkeLlng
A key goal of markeLlng ls Lo develop deep endurlng relaLlonshlps wlLh people and
organlzaLlons LhaL could dlrecLly or lndlrecLly affecL Lhe success of Lhe flrm's
markeLlng acLlvlLles
8elaLlonshlp MarkeLlng alms Lo bulld muLually saLlsfylng long Lerm relaLlonshlps
wlLh key consLlLuenLs ln order Lo earn and reLaln Lhelr buslness
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
8elaLlonshlp MarkeLlng
MarkeLers musL respecL Lhe need Lo creaLe prosperlLy among all Lhese consLlLuenLs
and develop pollcles and sLraLegles Lo balance Lhe reLurns Lo all key sLakeholders
1o develop sLrong relaLlonshlps wlLh Lhese consLlLuenLs requlres an undersLandlng
of Lhelr capablllLles and resources as well as Lhelr needs goals and deslres
1he ulLlmaLe ouLcome of 8elaLlonshlp markeLlng ls a unlque company asseL called
a MarkeLlng neLwork A MarkeLlng neLwork conslsLs of Lhe company and lL's
supporLlng sLakeholders wlLh whom lL has bullL muLually proflLable buslness
relaLlonshlps
1he operaLlng prlnclple ls slmple bulld an effecLlve neLwork of relaLlonshlps wlLh
key sLakeholders and proflL wlll follow
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
lnLegraLed MarkeLlng
1he MarkeLer's Lask ls Lo devlse markeLlng acLlvlLles and assemble fully lnLegraLed
markeLlng programs Lo creaLe communlcaLe and dellver value Lo consumers
1wo Lheme of lnLegraLed markeLlng are (l) many dlfferenL markeLlng acLlvlLles
communlcaLe and dellver value (ll) when coordlnaLed markeLlng acLlvlLles
maxlmlze Lhelr [olnL effecLs
ln oLher words markeLers should deslgn and lmplemenL any one markeLlng
acLlvlLy wlLh all oLher acLlvlLles ln mlnd
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
erformance MarkeLlng
1op managemenL ls golng beyond sales revenue Lo examlne Lhe markeLlng
scorecard and lnLerpreL whaL ls happenlng Lo markeL share cusLomer base
cusLomer saLlsfacLlon producL quallLy and oLher measures
erformance MarkeLlng ls abouL undersLandlng Lhe reLurns Lo Lhe buslness form
varlous markeLlng acLlvlLles
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
lnLernal MarkeLlng
lnLernal markeLlng ls Lhe Lask of hlrlng Lralnlng and moLlvaLlng able employees
who wanL Lo serve cusLomer well lL ensures LhaL everyone ln Lhe organlzaLlon
embraces approprlaLe markeLlng prlnclples especlally senlor managemenL
lnLernal markeLlng musL Lake place on Lwo levels
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
PollsLlc MarkeLlng
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
PollsLlc MarkeLlng
1he PollsLlc markeLlng ls based on Lhe developmenL deslgn and lmplemenLaLlon
of markeLlng programs processes and acLlvlLles LhaL recognlzes Lhelr breadLh and
lnLerdependencles
PollsLlc markeLlng ls Lhus an approach LhaL aLLempLs Lo recognlze and reconclle
Lhe scope and complexlLles of markeLlng acLlvlLles
Lx nlke 8reakLhrough MarkeLlng
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
Levels of MarkeLlng
Roaclivo
AccounlalIo
Iioaclivo
Iailnoiship
asic
VaIuo
InvoIvononl
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
Levels of MarkeLlng
8aslc MarkeLlng Slmply sells Lhe producL
8eacLlve MarkeLlng Sells Lhe producL encourages cusLomer Lo call lf he /she has
quesLlons
AccounLable MarkeLlng alls Lhe cusLomer afLer sale Lo ensure saLlsfacLlon and
seek commenLs
roacLlve MarkeLlng onLacLs cusLomer from Llme Lo Llme abouL lmproved
producL use or new producLs
arLnershlp MarkeLlng Works wlLh cusLomer conLlnuously Lo help lmprove Lhelr
performance
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
Levels of MarkeLlng
8aslc markeLlng Wholesalers local grocers
8eacLlve markeLlng 8eLallers deparLmenLal sLores
AccounLable markeLlng rlvaLe PosplLals 1herapy cenLres
roacLlve markeLlng Cymnaslums and PealLh clubs 8anks
arLnershlp markeLlng AdverLlslng agencles onsulLlng flrms
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
Levels of MarkeLlng
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
AcLlvlLles of MarkeLlng
MarkeLlng acLlvlLles broadly covers Lhe core acLlon polnLs of MarkeLlng as a
sLream
MarkeLlng acLlvlLles come ln all forms McarLhy classlfled Lhese acLlvlLles as
markeLlngmlx Lools of four broad klnds whlch he called Lhe four 's of markeLlng
roducL rlce lace and romoLlon
MarkeLers make markeLlngmlx declslons for lnfluenclng Lhelr Lrade channels as
well as Lhelr flnal consumers Cnce Lhey undersLand Lhese groups markeLers make
or cusLomlze an offerlng or soluLlon lnform consumers seL a prlce LhaL offers real
value and choose places where Lhe offerlng wlll be accesslble
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
MarkeLlng Mlx
MarkeLlng
Mlx
roducL
romoLlon lace
rlce
roducL SLraLegy
roducL lasslflcaLlon
roducL dlfferenLlaLlon
osL 8ecovery
eneLraLlon rlclng
Sklmmlng rlclng
ulsLrlbuLlon channel
ulrecL Sales
Supply haln / LoglsLlcs
Mass ommunlcaLlon
8rand ManagemenL
orporaLe ldenLlLy
1argeL
MarkeL
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
43
Market|ng M|x
roducL varleLy
CuallLy
ueslgn
leaLures
8rand name
ackaglng
Slzes
Servlces
WarranLles
8eLurns
roduct
ace
hannels
overage
AssorLmenLs
LocaLlons
lnvenLory
1ransporL
romot|on
Sales promoLlon
AdverLlslng
Salesforce
ubllc relaLlons
ulrecL markeLlng
r|ce
LlsL prlce
ulscounLs
Allowances
aymenL perlod
redlL Lerms
1arget Market
MarkeLlng Mlx
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
SeLLlng roducL SLraLegy
A producL ls anyLhlng LhaL can be offered Lo a markeL ( consumer ) Lo saLlsfy a need or
wanL
omponents of market offer|ng
value
leaLures
CuallLy
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
oLenLlal producL
AugmenLed
roducL
LxpecLed
roducL
8aslc producL
ore 8eneflL
1he ustomer vaue h|erarchy
SeLLlng roducL SLraLegy
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
ore 8eneflL Servlce or beneflL Lhe cusLomer ls really buylng
Lg PoLel resL sleep
8aslc roducL Add value Lo Lhe core beneflL
Lg Addlng bed baLhroom Lowels desk dresser eLc
LxpecLed roducL A seL of aLLrlbuLes condlLlons buyers normally expecLs when
Lhey make any purchase
Lg leans clean bed fresh Lowels worklng lamps eLc
AugmenLed roducL 8eneflLs whlch exceeds cusLomer expecLaLlons
oLenLlal roducL All Lhe posslble augmenLaLlons LransformaLlons Lhe producL
or offerlng mlghL undergo ln Lhe fuLure
SeLLlng roducL SLraLegy
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
roducL
lasslflcaLlon
1anglblllLy
uurablllLy
usage
non uurable
uurable
Servlce
onsumer
onvenlence Shopplng SpeclalLy unsoughL
lndusLrlal
SLaple
lmpulse
Lmergency
Pomogeneous
PeLerogeneous
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
roducL lasslflcaLlon
MarkeLers have LradlLlonally classlfled producLs on Lhe basls of durablllLy LanglbllLy
and use ( consumer or lndusLrlal )
urab||ty and 1ang|b|ty
non uurable goods ( lMC ) Coods consumed ln one or few uses
uurable goods normally survlves many uses
Servlces lnLanglble lnseparable varlable and perlshable producLs
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
roducL lasslflcaLlon
onsumer oods ass|f|cat|on
onven|ence oods 1he consumer usually purchases frequenLly lmmedlaLely and
wlLh a mlnlmum efforL ( SofL drlnks soaps newspaper)
onven|ence oods can be furLher dlvlded lnLo
SLaple Coods onsumer purchase on regular basls ( 1ooLhpasLe Shampoos )
lmpulse Coods urchased wlLhouL any plannlng ( chocolaLes chlps )
Lmergency Coods urchased when a need ls urgenL ( umbrella Shawls )
hopp|ng oods Are goods LhaL Lhe consumer characLerlsLlcally compares on such
bases as sulLablllLy quallLy prlce and sLyle ( lurnlLure loLhlng ar )
Pomogeneous Coods Slmllar ln quallLy buL dlfferenL enough ln prlce
PeLerogeneous Coods ulffer ln producL feaLures and servlces LhaL may be more
lmporLanL Lhan prlce
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
roducL lasslflcaLlon
pec|aty oods Pave unlque characLerlsLlcs or brand ldenLlflcaLlon for whlch
sufflclenL number of buyers are wllllng Lo make a speclal purchaslng efforL
Unsought oods are Lhose Lhe consumers does noL know abouL or does noL
normally Lhlnk of buylng
Industr|a oods an be classlfled ln Lerms of Lhelr relaLlve cosL and how Lhey enLer
Lhe producLlon process maLerlal and parLs caplLal lLems and supplles and buslness
servlces
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
rlclng SLraLegy
r|ce
rlce ls slmply Lhe amounL of money LhaL consumers are wllllng Lo pay for a
offerlngs rlce ls Lhe only elemenL of Lhe markeLlng mlx LhaL produces revenue
rlce comes ln varlous forms and performs many funcLlons 8enL fares fees raLes
cosL reLalner wages and commlsslon all may ln some way be Lhe prlce you pay for
some good or servlce
1radlLlonally prlce has been Lhe ma[or deLermlnanL of a buyer's cholce And Lhls ls
sLlll Lhe case wlLh large segmenLs of buyers across Lhe globe AlLhough non prlce
facLors have become qulLe lmporLanL ln Lhe lasL few decades prlce sLlll remalns an
lmporLanL facLor ln deLermlnlng sales proflLablllLy
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
rlclng SLraLegy
eect|ng the pr|c|ng ob[ect|ve
1he company flrsL decldes where lL wanLs Lo poslLlon lL's markeL offerlng 1he
clearer a flrm's ob[ecLlves Lhe easler ls Lo seL Lhe prlce
llve ma[or ob[ecLlves are
Survlval
Maxlmum urrenL roflL
Maxlmum MarkeL Share
Maxlmum MarkeL Sklmmlng
roducL CuallLy Leadershlp
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
rlclng Cb[ecLlve
urv|va
ompanles pursue survlval as Lhelr ma[or ob[ecLlve lf Lhey plagued wlLh over
capaclLy lnLense compeLlLlon or changlng consumer wanLs As long as prlces cover
varlable cosLs and some flxed cosL Lhe company sLays ln buslness Survlval ls a
shorL run ob[ecLlve ln Lhe long run Lhe flrm musL learn how Lo add value or face
exLlncLlon
Lg hlk Shampoo vlcco klneLlc and Codre[
Max|mum urrent rof|t
Many companles Lry Lo seL a prlce LhaL wlll maxlmlze currenL proflLs 1hey esLlmaLe
Lhe demand and cosL and choose Lhe prlce LhaL produces maxlmum currenL proflL
1hls sLraLegy assumes LhaL Lhe flrm has Lhe knowledge of lL's demand and cosL
funcLlons ln reallLy Lhese are dlfflculL Lo esLlmaLe ln emphaslzlng currenL
performance Lhe company may sacrlflce long run performance by lgnorlng Lhe
effecLs of oLher markeLlng mlx varlables and compeLlLor's reacLlon
Lg Cnlda CM moLors uabur
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
rlclng Cb[ecLlve
Max|mum Market hare
1hey belleve LhaL hlgher sales volume wlll lead Lo lower unlL cosLs and hlgher long
run proflL 1hey seL Lhe lowesL prlce assumlng Lhe markeL ls prlce senslLlve
1hls sLraLegy ls also called as MarkeL eneLraLlon SLraLegy
Lg nlrma 8ellance
Max|mum Market k|mm|ng
ompanles whlch favors seLLlng hlgh prlces follows markeL sklmmlng sLraLegy 1hls
sLraLegy can be faLal however lf a worLhy compeLlLor decldes Lo prlce low
Lg nokla Sony
roductua|ty Leadersh|p
Many brands sLrlve Lo be affordable luxurles producL or servlces characLerlzed
by hlgh level of percelved quallLy LasLe and sLaLus wlLh a prlce [usL hlgh enough
noL Lo be ouL of conusmer's reach Lg Merc 8arlsLa
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
lour lnLroducLory rlclng SLraLegles
romoLlon
Plgh
Low
Plgh
rlce
Low
8apld
sklmmlng
sLraLegy
Slowsklmmlng
sLraLegy
8apld
peneLraLlon
sLraLegy
Slow
peneLraLlon
sLraLegy
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
CLher rlclng SLraLegles
onsumer sychoogy and r|c|ng
8eference rlclng When examlnlng producLs consumers ofLen employ reference
prlces comparlng an observed prlce Lo an reference prlce Lhey remember
rlceCuallLy lnference Many consumers use prlce as an lndlcaLor of quallLy
lmage prlclng ls especlally effecLlve wlLh ego senslLlve producLs
rlce ues Sale" slgns nexL Lo prlce have been shown Lo spur demand Many
sellers belleve LhaL prlces should end ln an odd number
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
CLher rlclng SLraLegles
Iaue r|c|ng
value prlclng ls noL a maLLer of slmply seLLlng lower prlces lL ls a maLLer of
reenglneerlng Lhe company's operaLlon Lo become a low cosL producer / provlder
wlLhouL sacrlflclng quallLy Lo aLLracL a large number of value consclous
cusLomers
LuL LuL Lakes place aL reLall level A reLaller holds Lo an LuL prlclng pollcy
charges a consLanL low prlce wlLh llLLle or no prlce promoLlons and speclal sales
o|ng kate r|c|ng
1he flrm bases lLs prlce largely on compeLlLor's prlces charglng Lhe same more or
less Lhan ma[or compeLlLor
1he sLraLegy ls also known as lollow Lhe leader" pollcy
Lg ocora[ l1 SunfeasL 8lngo She omforL
Auct|on 1ype r|c|ng
usLomer hoose Lhelr rlce
lS growlng popular especlally wlLh Lhe growLh of Lhe lnLerneL
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
LAL
haln of lnLermedlarles each passlng Lhe producL down Lhe chaln Lo Lhe nexL
organlzaLlon before lL flnally reaches Lhe consumer or enduser 1hls process ls known
as Lhe dlsLrlbuLlon chaln or Lhe 'markeLlng channel Lach of Lhe elemenLs ln Lhese
chalns wlll have Lhelr own speclflc needs whlch Lhe producer musL Lake lnLo accounL
along wlLh Lhose of Lhe alllmporLanL enduser
ln managlng lL's lnLermedlarles Lhe flrm musL declde how much efforL Lo devoLe Lo
push verus pull markeLlng
A push sLraLegy uses Lhe manufacLure's sales force Lrade promoLlon or oLher means
Lo lnduce lnLermedlarles Lo carry promoLe and sell Lhe producL Lo end users
ush SLraLegy ls approprlaLe where Lhere ls low brand loyalLy ln a caLegory brand
cholce ls made ln Lhe sLore Lhe producL ls an lmpulse lLem
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
LAL
ln a ull sLraLegy Lhe manufacLurer uses adverLlslng sales promoLlon and oLher forms
of communlcaLlon Lo persuade Lhe consumers Lo demand Lhe producL from
lnLermedlarles Lhus lnduclng Lhe lnLermedlarles Lo order lL
ull SLraLegy ls approprlaLe when Lhere ls hlgh brand loyalLy and moderaLe hlgh
lnvolvemenL ln Lhe caLegory when consumers are able Lo percelve dlfferences
beLween brands and when Lhey choose Lhe brand before Lhey go Lo sLore
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
LAL
A MarkeLlng hannel performs Lhe work of movlng goods from producers Lo
consumers lL overcomes Lhe Llme place and possesslon gaps LhaL separaLe goods and
servlces from Lhose who need or wanL Lhem
hanne Leve
1he roducer and Lhe flnal consumer are Lhe parL of every channel We wlll
undersLand Lhe number of lnLermedlarles requlred Lo deLermlne Lhe lengLh of Lhe
channel
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
Manufacturer
Consumer Market
Consumer
Retailer
Wholesaler
IndustriaI Market
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
LAL
-umber of Intermed|ar|es
ompanles musL declde on Lhe number of lnLermedlarles Lo sulL aL each level 1hree
sLraLegles are avallable
Lxcluslve ulsLrlbuLlon
SelecLlve ulsLrlbuLlon
lnLenslve ulsLrlbuLlon
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
LAL
Lxcus|ve |str|but|on
Means severely llmlLlng Lhe number of lnLermedlarles lL's approprlaLe when Lhe
producer wanLs Lo malnLaln conLrol over Lhe servlce level and ouLpuLs offered by
Lhe resellers Lg 8olls 8oyce 8eld 1aylor Cuccl
eect|ve |str|but|on
8elles on more Lhan a few buL less Lhan all of Lhe lnLermedlarles wllllng Lo carry a
parLlcular producL lL makes sense for esLabllshed companles and for new
companles seeklng dlsLrlbuLors Lg 8aymond
Intens|ve |str|but|on
1he ManufacLurer places Lhe goods and servlces ln as many as ouLleLs as posslble
Lo reach Lo masses
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
LAL
hannels of dlsLrlbuLlon operaLe by one of Lwo meLhods convenLlonal dlsLrlbuLlon or
a verLlcal markeLlng sysLem
ln Lhe convenLlonal dlsLrlbuLlon channel Lhere can be one or more lndependenL
producL manufacLurers wholesalers and reLallers ln a channel
1he verLlcal markeLlng sysLem requlres LhaL producers wholesalers and reLallers Lo
work LogeLher Lo avold channel confllcLs
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
8CMC1lCn
MarkeLlng communlcaLlons are Lhe means by whlch flrms aLLempL Lo lnform persuade
and remlnd consumers dlrecLly or lndlrecLly abouL Lhe producLs and brands Lhey sell
ln a sense M represenLs Lhe volce" of Lhe company and lLs brands and are a means
by whlch lL can esLabllsh a dlalogue and bulld relaLlonshlps wlLh consumers
luncLlons of M Lnhance sales 8ulld 8rand equlLy Spread awareness roducL
launch remlnder Lool !
rof kk ML1 Inst|tute of Management eM8A
Marketing Management- Sem I
8CMC1lCn
ommunlcaLlon
Mlx
AdverLlslng
Sales
romoLlon