WHAT IS MARKETING ?

WHAT IS MARKETING ?

Marketing is a social process by which individuals and groups obtain what they need and want through creating and exchanging products and value with others

PHILIP KOTLER

NEEDS ,WANTS and DEMANDS --- PRODUCTS------VALUE & SATISFACTION---EXCHANGE & TRANSACTION---MARKETS & MARKETERS

The essence of Marketing is a transaction - an exchange- intended to satisfy human needs and wants. There are three elements in the marketing process :

(A) MARKETERS

(B)WHAT IS BEING MARKETED

(C) TARGET MARKET

WHAT IS MARKETING ?

NEED : A state of felt deprivation of some basic satisfaction ( Food, Clothing, Shelter, Belonging etc. )

WANTS : Wants are desires for specific satisfiers of the deeper needs. Needs are few and wants are many .

DEMANDS : are wants backed by ------Ability to buy and Willingness to buy

NEEDS,WANTS AND DEMANDS

Anything that can be offered to someone to satisfy a need or want is a product .

Product refers to physical object

Services refer to intangible object

PRODUCTS / OFFERS / SATISFIERS / RESOURCES

Value is the customers’ estimate of the Product’s capacity to satisfy a set of goals

Customer gets benefits & assume costs WHEN :Customer Expectance=Performance

(satisfied) Customer Expectance>Performance (dis-

satisfied) Customer Expectance<Performance (Highly

satisfied)

VALUE AND SATISFACTION

Exchange is a process rather than event. It is a value creating process because it normally leaves both parties better off.

A transaction is a trade of values between two or more parties ( A BARTER TRANSACTION OR A MONETARY TRANSACTION ).

EXCHANGE AND TRANSACTION

A market consists of all the potential

customers sharing a particular need or want

who might be willing and able to engage in

exchange to satisfy that need or want.

WHAT IS MARKET ?

Marketing Management is the analysis,

planning, implementation and control of

programs designed to create, build and

maintain beneficial exchanges and

relationships with target markets for the

purpose of achieving Organisational

objectives.

WHAT IS MARKETING MANAGEMENT ?

Marketing management is demand management or it involves the task of influencing the level, timing and composition of demand. At times the actual demand level may be below, equal to, or above the desired demand level and the major task of marketing management is to regulate the level of demand.

WHAT IS MARKETING MANAGEMENT ?

State of demand Negative Demand No Demand Latent Demand Falling Demand Irregular Demand Full Demand Overfull Demand Un-wholesome Demand

Marketing task Conversional Mktg. Stimulational Mktg. Developmental Mktg. Remarketing Synchro-marketing Maintenance Mktg. Demarketing Counter-marketing

STATE OF DEMAND AND MARKETING TASK

Marketing management has evolved through following stages :

(1) Production Orientation Stage (2) Sales Orientation Stage (3) Marketing Orientation Stage (4) Social Responsibility & Human

Orientation Stage

EVOLUTION OF MARKETING MANAGEMENT

Marketing Management can be defined as the effort to achieve desired EXCHANGE outcomes with TARGET MARKETS.

Now the question arises : (1) What philosophy should guide the marketing

activities? (2) What weights should be given to the interests

of the organisation, the customers and the society?

COMPANY ORIENTATION FOR MARKETING ACTIVITIES

The marketing concept:• A marketing management philosophy that

holds that achieving organizational goals depends on knowing the needs and wants of target markets and delivering the desired satisfaction better than competitors.

The Marketing Concept

There are FIVE competing concepts under which organizations conduct their marketing activities:

The Production Concept The Product Concept The Selling Concept The Marketing Concept The Societal Marketing Concept

MARKETING CONCEPT, DIMENSIONS

ProduceSell

Consumers

Company

Produce more & more

Practically sells itself

(1) THE PRODUCTION CONCEPT

Consumers will favour those products that are widely available and low in cost.

Therefore increase production and cut down costs.

And build profit through volume.

THE PRODUCTION CONCEPT

Produce Quality Products

Sell Consumers

Practically sells itself,if it gives most quality for money

Buyers admire well-made products and can appraise product quality and performance.

(2) THE PRODUCT CONCEPT

Consumers will favour those products that offer the most quality, performance, or innovative features.

Therefore, improve quality, performance and features.

This would lead to increased sales and profits.

THE PRODUCT CONCEPT

Consumers have normal tendency to resist.

Produce

Sell it Consumers

Aggressive selling & promotion efforts

Making sales becomes primary function and consumer satisfaction secondary .

(3) SELLING CONCEPT

Consumers , if left alone , will not buy enough of company’s products.

Therefore, promote sales aggressively.

And,build profit through quick turnover.

THE SELLING CONCEPT

“ LOVE THE CUSTOMER , NOT THE PRODUCT ”

ConsumersProduce it

Market it

Learn what they want(MR)

Sell what they want(Satisfy needs of customers)

(4) MARKETING CONCEPT

The key to achieving organizational goals consist in determining the needs and wants of target markets and delivering the desired satisfactions more effectively and efficiently than competitors.

And build profit through customer satisfaction and loyalty.

THE MARKETING CONCEPT

It is Marketing Concept (+) Society’s well being. Balancing of following three considerations

while setting marketing policies :-Customer’s want satisfaction Society’s well being Company’s profits

(5) THE SOCIETAL MARKETING CONCEPT

The societal marketing concept holds that the organization’s task is to determine the needs, wants, and interests of target markets and to deliver the desired satisfactions more effectively and efficiently than competitors in a way that preserves or enhances the consumer’s and the society’s well being.

It addresses conflicts between consumer’s and firm’s short run wants and long term welfare.

THE SOCIETAL MARKETING CONCEPT

Shifted the focus of Marketing from Product or customer to the CUSTOMER IN THE CONTEXT OF THE BROADER EXTERNAL ENVIRONMENT .

To succeed, marketers must know the customer in a context including the competition, Govt. Policy& regulation and the broader economic, social and political macro forces that shape the evolution of market.

STRATEGIC CONCEPT OF MARKETING

Shifted the Marketing Objectives from PROFIT TO STAKEHOLDER BENEFITS.

Stakeholders are individuals or groups who have an interest in the activity of a company . They include-----The employees and management, Customers, Society, Shareholders, Financiers/ Bankers, Government etc.

STRATEGIC CONCEPT OF MARKETING

Strategic Marketing Concept is Strategic

Management, which integrates marketing

with the other management functions.

( Major task is Profit for Stakeholders’

benefits ).

STRATEGIC CONCEPT OF MARKETING

Marketing is concerned with the flow of goods and services from the points of production to the points of consumption. There is a systematic arrangement of these functions of marketing to move the goods and services to the needy persons. This system is essential to the creation of time, place and possession utilities.

MARKETING SYSTEM

MAXIMIZE CONSUMPTION

MAXIMIZE CONSUMER SATISFACTION

MAXIMIZE CHOICE

MAXIMIZE LIFE QUALITY

GOALS OF THE MARKETING SYSTEM

Responsive Marketing

Anticipative Marketing

Need Shaping Marketing

THREE LEVELS OF MARKETING

It is the form of marketing when some company defines an existing clear need and prepare an affordable solution.

(Recognizing that women wanted to spend less time for cooking and cleaning, led to the invention of modern washing machine, microwave oven etc.)

RESPONSIVE MARKETING

It is a form of marketing when a company recognize an emergent or latent need, and come out with an affordable solution. Evian, Perrier anticipated growing market for bottled drinking water as the quality of water deteriorated in many places.

Anticipative marketing is more risky than responsive marketing; companies may come into market too early or too late, or may even be totally wrong about thinking that such a market would develop.(eg. Dish washers in India)

ANTICIPATIVE MARKETING

The broadest level of marketing occurs when a company introduces product that nobody asked for and often could not even conceive of.

(e.g. Sony Walkman, Sony Compact Disc )

Late Akio Morita, founder and chairman of Sony, who introduced these and many other new products, summarized his marketing philosophy in these words: “ I don’t serve markets. I create them.”

NEED SHAPED MARKETING

Physical GoodsServiceExperiences EventsPersons

PlacesPropertiesOrganizationsInformationIdeas

The Scope Of Marketing

Marketers are involved with marketing ten types of entities:

In very basic economic systems, each seller must meet directly with each buyer in order to exchange something of value. As needs increase, the number of exchanges can soon become unmanageable for one person.

Ten exchanges requiredwithout central market

Pots

batsHats

knifesoap

Exchange and Marketing

Centralmarket

middleman

Pots

batsHats

knifesoap

Five exchanges requiredwith central market

In a centralized market, a buyer can go to one location to find many different products from many different sellers. By reducing the time both buyers and sellers must spend to complete an exchange, prices can be lowered.

Consumer markets

Business markets

Global markets

Nonprofit/Government markets

PRODUCTS / OFFERS / SATISFIERS / RESOURCES

Environmental analysis and marketing research:

Monitoring and adapting to external factors that affect success or failure, such as the economy and competition; and collecting data to resolve specific marketing issues.

Broadening the Scope of Marketing:

Deciding on the emphasis to place, as well as the approach to take, on societal issues, global marketing, and the Web.

Consumer analysis: Examining and evaluating consumer characteristics, needs and purchase

processes; and selecting the group(s) of consumers at which to aim marketing efforts.

Marketing Functions

Product planning (including goods, services, organizations, people, places, ideas):

Developing and maintaining products, product assortments, product images, brands, packaging, and optional features, and deleting faltering products.

Distribution planning:

Forming logistical relationships with intermediaries, physical distribution, inventory management, warehousing, transportation, allocating goods and services, wholesaling, and retailing.

Promotion planning:

Communicating with customers, the general public, and others through some type of advertising, public relations, personal selling, and/or sales promotion.

Marketing Functions continued

Price planning:

Determining price levels and ranges, pricing techniques, terms of purchase, price adjustments, and the use of price as an active or passive factor.

Marketing management:

Planning, implementing, and controlling the marketing program (strategy) and individual marketing functions; appraising the risks and benefits in decision making; and focusing on total quality.

Marketing Functions continued

Facilitating Functions

Physical Functions

Exchange Functions

Buying and Selling

Transportation

StoragePr

oces

sing

Stan

dard

izatio

n Financing

Market

Intellig

ence

Risk Bearing

Marketing Functions (Remember)

DONE FOR THE DAY