Marketing Management

Marketing is an important function that brings companies and clients closer together. Marketing
management and establishing a marketing orientated organisation with the emphasis on the
customer is a core component in an organisations success.
"Marketing management is "the art and science of choosing target markets and getting, keeping,
and growing customers through creating, delivering, and communicating superior customer
value" (Kotler and Keller, 2008: 5)."
The concept reviews the process used to determine what products or services may be of interest
to customers and the strategy to use for marketing mix. It also explores the process of
understanding, creating and delivering value to targeted business markets and customers.
Marketing is the process used to determine what products or services may be of interest to
customers and the strategy to use in sales, communications and business development (Kotler et
al. 1996). The American Association of Marketing define marketing management as the process
of planning and executing the conception, pricing, promotion and distribution of ideas, goods
and services in order to create, exchange and satisfy individual and organisational objectives
(Grnroos, 1989).

Main functions of marketing management

Marketing Management has the responsibility of to perform many functions in the field of
marketing such as planning, organizing, directing, motivating, coordinating and controlling. All
these function aim to achive the marketing goals. Following is a brief summary of functions of
Marketing Objectives: marketing management determines the marketing objectives. The
marketing objectives may be short term or long term and need a clear approach. They have to be
in coherence with the aims and objectives of the organization. Planning: After objectively
determining the marketing Objectives, the important function of the marketing Management is to
plan how to achieve those objectives. This includes sales forecast, marketing programs
formulation, marketing strategies. Organization: A plan once formulated needs implementation.
Organizing functions of marketing management involves the collection and coordination of
required means to implement a plan and to achieved pre determined objectives. The organization
involves structure of marketing organization, duties, responsibilities and powers of various
members of the marketing organization. Coordination: Coordination refers to harmonious
adjustment of the activities
of the marketing organization. It involves coordination among various activities such as sales
forecasting, product planning, product development, transportation, warehousing etc. Direction:
Direction in marketing management refers to development of new markets, leadership of
employees, motivation, inspiration, guiding and supervision of the employees. Control: Control
refers to the effectiveness with which a marketing plan is implemented. It involves the
determination of standards, evaluation of actual performance, adoption of corrective measures,
Staffing: Employment of right and able employees is very crucial to success of a market plan.
The market manager coordinates with the Human Resource Manager of an organization to be
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able to hire the staff with desired capability. Analysis and Evaluation: The marketing
management involves the analysis and evaluation of the productivity and performs mace of
individual employees.

Marketing strategy
Marketing strategy is the goal of increasing sales and achieving a sustainable competitive
advantage.[1] Marketing strategy includes all basic and long-term activities in the field of
marketing that deal with the analysis of the strategic initial situation of a company and the
formulation, evaluation and selection of market-oriented strategies and therefore contribute to the
goals of the company and its marketing objectives. Marketing is the process of planning and
executing the conception, pricing, promotion, and distribution of ideas, goods, and services. A
marketing strategy is composed of several interrelated components called the marketing mix.

Firms Business Strategy

Business (or Strategic) management is the art, science, and craft of formulating, implementing and evaluating
cross-functional decisions that will enable an organization to achieve its long-term objectives. It is the process
of specifying the organization's mission, vision and objectives, developing policies and plans, often in terms of
projects and programs, which are designed to achieve these objectives, and then allocating resources to
implement the policies and plans, projects and programs. Strategic management seeks to coordinate and
integrate the activities of the various functional areas of a business in order to achieve long-term organizational
objectives. A balanced scorecard is often used to evaluate the overall performance of the business and its
progress towards objective.

Bases for Consumer Market Segmentation

There are number of variables involved in consumer market segmentation, alone and in
combination. These variables are:

Geographic variables

Demographic variables

Psychographic variables

Behavioral variables

Geographic Segmentation
In geographical segmentation, market is divided into different geographical units like:

Regions (by country, nation, state, neighborhood)

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Population Density (Urban, suburban, rural)

City size (Size of area, population size and growth rate)

Climate (Regions having similar climate pattern)

A company, either serving a few or all geographic segments, needs to put attention on variability
of geographic needs and wants. After segmenting consumer market on geographic bases,
companies localize their marketing efforts (product, advertising, promotion and sales efforts).

Demographic Segmentation
In demographic segmentation, market is divided into small segments based on demographic
variables like:

Age

Gender

Income

Occupation

Education

Social Class

Generation

Family size

Family life cycle

Home Ownership

Religion

Ethnic group/Race

Nationality
Demographic factors are most important factors for segmenting the customers groups. Consumer
needs, wants, usage rate these all depend upon demographic variables. So, considering
demographic factors, while defining marketing strategy, is crucial.

Psychographic Segmentation
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In Psychographic Segmentation, segments are defined on the basis of social class, lifestyle and
personality characteristics.
Psychographic variables include:

Interests

Opinions

Personality

Self Image

Activities

Values

Attitudes
A segment having demographically grouped consumers may have different psychographic
characteristics.

Behavioral Segmentation
In this segmentation market is divided into segments based on consumer knowledge, attitude, use
or response to product.
Behavioral variables include:

Usage Rate

Product benefits

Brand Loyalty

Price Consciousness

Occasions (holidays like mothers day, New Year and Eid)

User Status (First Time, Regular or Potential)

Behavioral segmentation is considered most favorable segmentation tool as it uses those
variables that are closely related to the product itself.

Core concept of marketing

Need, Wants and Demand: Marketing begins with human needs and wants. Needs are feelings
of deprivation of some
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satisfaction. People need food, air, water, shelter to survive. Wants are desire for satisfies of
needs. Wants which are backed by the purchasing power become demand
Products (Goods, Services and Ideas): A product is anything that can be offered to satisfy a
need or want. A product may consist of three components- physical goods, services and ideas.
Value, Cost and Satisfaction: Value means the customer's estimate of the product's overall
capacity to satisfy his/her needs. Cost is the price which a customer pays the products.
Satisfaction is inner felling.
Exchange and Transaction: Exchange is the process of obtaining a desired product from
someone by offering something in return. Exchange leads to transactions.
Relationship and Networks: Relationship marketing refers to the process of building long-term
satisfying relationship with customer, distributors and suppliers.
Marketing Environment: Marketing environments are divided into two parts. Internal
environment includes customer, suppliers, managements, employees, productions, etc. On the
other hand external environment includes sociocultural environment, political, technological,
economic environment, etc.
Competition: Completion may come in many forms. A firm always competes with the existing
player. Threat of potential competitor is also taken in consideration. Substitute product is also a
competitor to firm.
Supply Chain: Supply chain is a longer channel includes backward and forward logistic. It
stretches from raw materials to delivery of finished goods to the ultimate consumer. Capturing
higher value of supply chain gives firm competitive advantage over competitor firms.

Services marketing
Services marketing is a sub-field of marketing, which can be split into the two main areas of
goods marketing (which includes the marketing of fast moving consumer goods (FMCG) and
durables) and services marketing. Services marketing typically refers to both business to
consumer (B2C) and business to business (B2B) services, and includes marketing of services
such as telecommunications services, financial services, all types of hospitality services, car
rental services, air travel, health care services and professional services.
Services are (usually) intangible economic activities offered by one party to another. Often timebased, services performed bring about desired results to recipients, objects, or other assets for
which purchasers have responsibility. In exchange for money, time, and effort, service customers
expect value from access to goods, labor, professional skills, facilities, networks, and systems;
but they do not normally take ownership of any of the physical elements involved.[1]
There has been a long academic debate on what makes services different from goods. The
historical perspective in the late-eighteen and early-nineteenth centuries focused on creation and
possession of wealth. Classical economists contended that goods were objects of value over
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which ownership rights could be established and exchanged. Ownership implied tangible
possession of an object that had been acquired through purchase, barter or gift from the producer
or previous owner and was legally identifiable as the property of the current owner.

Differentiated Marketing Strategy

A differentiated marketing strategy is when a company creates campaigns that appeal to at least
two market segments or target groups. For example, a store can promote a sale that appeals to
people in at least two cities or locations, or a company can market a product that appeals to
women in at least two age groups. Differentiated marketing strategies can target many more than
two segments; shoe companies often create campaigns that appeal to both men and women in a
variety of age groups. Differentiated marketing strategies can also use different messages in the
same campaign for different segments. For example, a retailer might market low cost to a
budget-conscious segment and product quality to an affluent market segment.
Factors Affecting Consumer Behavior
Consumer behavior refers to the selection, purchase and consumption of goods and services for
the satisfaction of their wants. There are different processes involved in the consumer behavior.
Initially the consumer tries to find what commodities he would like to consume, then he selects
only those commodities that promise greater utility. After selecting the commodities, the
consumer makes an estimate of the available money which he can spend. Lastly, the consumer
analyzes the prevailing prices of commodities and takes the decision about the commodities he
should consume. Meanwhile, there are various other factors influencing the purchases of
consumer such as social, cultural, personal and psychological. The explanation of these factors is
given below.
1. Cultural Factors
Consumer behavior is deeply influenced by cultural factors such as: buyer culture, subculture,
and social class.
Culture
Basically, culture is the part of every society and is the important cause of person wants and
behavior. The influence of culture on buying behavior varies from country to country therefore
marketers have to be very careful in analyzing the culture of different groups, regions or even
countries.
Subculture
Each culture contains different subcultures such as religions, nationalities, geographic regions,
racial groups etc. Marketers can use these groups by segmenting the market into various small
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portions. For example marketers can design products according to the needs of a particular
geographic group.
Social Class
Every society possesses some form of social class which is important to the marketers because
the buying behavior of people in a given social class is similar. In this way marketing activities
could be tailored according to different social classes. Here we should note that social class is not
only determined by income but there are various other factors as well such as: wealth, education,
occupation etc.
2. Social Factors
Social factors also impact the buying behavior of consumers. The important social factors are:
reference groups, family, role and status.
Reference Groups
Reference groups have potential in forming a person attitude or behavior. The impact of
reference groups varies across products and brands. For example if the product is visible such as
dress, shoes, car etc then the influence of reference groups will be high. Reference groups also
include opinion leader (a person who influences other because of his special skill, knowledge or
other characteristics).
Family
Buyer behavior is strongly influenced by the member of a family. Therefore marketers are trying
to find the roles and influence of the husband, wife and children. If the buying decision of a
particular product is influenced by wife then the marketers will try to target the women in their
advertisement. Here we should note that buying roles change with change in consumer lifestyles.
Roles and Status
Each person possesses different roles and status in the society depending upon the groups, clubs,
family, organization etc. to which he belongs. For example a woman is working in an
organization as finance manager. Now she is playing two roles, one of finance manager and other
of mother. Therefore her buying decisions will be influenced by her role and status.
3. Personal Factors
Personal factors can also affect the consumer behavior. Some of the important personal factors
that influence the buying behavior are: lifestyle, economic situation, occupation, age, personality
and self concept.
Age
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Age and life-cycle have potential impact on the consumer buying behavior. It is obvious that the
consumers change the purchase of goods and services with the passage of time. Family life-cycle
consists of different stages such young singles, married couples, unmarried couples etc which
help marketers to develop appropriate products for each stage.
Occupation
The occupation of a person has significant impact on his buying behavior. For example a
marketing manager of an organization will try to purchase business suits, whereas a low level
worker in the same organization will purchase rugged work clothes.
Economic Situation
Consumer economic situation has great influence on his buying behavior. If the income and
savings of a customer is high then he will purchase more expensive products. On the other hand,
a person with low income and savings will purchase inexpensive products.
Lifestyle
Lifestyle of customers is another import factor affecting the consumer buying behavior. Lifestyle
refers to the way a person lives in a society and is expressed by the things in his/her
surroundings. It is determined by customer interests, opinions, activities etc and shapes his whole
pattern of acting and interacting in the world.
Personality
Personality changes from person to person, time to time and place to place. Therefore it can
greatly influence the buying behavior of customers. Actually, Personality is not what one wears;
rather it is the totality of behavior of a man in different circumstances. It has different
characteristics such as: dominance, aggressiveness, self-confidence etc which can be useful to
determine the consumer behavior for particular product or service.
4. Psychological Factors
There are four important psychological factors affecting the consumer buying behavior. These
are: perception, motivation, learning, beliefs and attitudes.
Motivation
The level of motivation also affects the buying behavior of customers. Every person has different
needs such as physiological needs, biological needs, social needs etc. The nature of the needs is
that, some of them are most pressing while others are least pressing. Therefore a need becomes a
motive when it is more pressing to direct the person to seek satisfaction.
Perception
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Selecting, organizing and interpreting information in a way to produce a meaningful experience

of the world is called perception. There are three different perceptual processes which are
selective attention, selective distortion and selective retention. In case of selective attention,
marketers try to attract the customer attention. Whereas, in case of selective distortion, customers
try to interpret the information in a way that will support what the customers already believe.
Similarly, in case of selective retention, marketers try to retain information that supports their
beliefs.
Beliefs and Attitudes
Customer possesses specific belief and attitude towards various products. Since such beliefs and
attitudes make up brand image and affect consumer buying behavior therefore marketers are
interested in them. Marketers can change the beliefs and attitudes of customers by launching
special campaigns in this regard.

Penetration pricing strategies

You often see the tagline "special introductory offer" the classic sign of penetration pricing.
The aim of penetration pricing is usually to increase market share of a product, providing the
opportunity to increase price once this objective has been achieved.
Penetration pricing is the pricing technique of setting a relatively low initial entry price, usually
lower than the intended established price, to attract new customers. The strategy aims to
encourage customers to switch to the new product because of the lower price.
Penetration pricing is most commonly associated with a marketing objective of increasing
market share or sales volume. In the short term, penetration pricing is likely to result in lower
profits than would be the case if price were set higher. However, there are some significant
benefits to long-term profitability of having a higher market share, so the pricing strategy can
often be justified.
Penetration pricing is often used to support the launch of a new product, and works best when a
product enters a market with relatively little product differentiation and where demand is price
elastic so a lower price than rival products is a competitive weapon.
Amongst the advantages claimed for penetration pricing include:
- Catching the competition off-guard / by surprise
- Encouraging word-of-mouth recommendation for the product because of the attractive pricing
(making promotion more effective)
- It forces the business to focus on minimising unit costs right from the start (productivity and
efficiency are important)
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- The low price can act as a barrier to entry to other potential competitors considering a similar
strategy
- Sales volumes should be high, so distribution may be easier to obtain
Penetration pricing strategies do have some drawbacks, however:
- The low initial price can create an expectation of permanently low prices amongst customers
who switch. It is always harder to increase prices than to lower them
- Penetration pricing may simply attract customers who are looking for a bargain, rather than
customers who will become loyal to the business and its brand (repeat business)
- The strategy is likely to result in retaliation from established competitors, who will try to
maintain their market share

Price Skimming
Price skimming involves setting a high price before other competitors come into the market.
This is often used for the launch of a new product which faces little or now competition usually
due to some technological features. Such products are often bought by "early adopters" who are
prepared to pay a higher price to have the latest or best product in the market.
There are some other problems and challenges with this approach:
Price skimming as a strategy cannot last for long, as competitors soon launch rival products that
put pressure on the price.
Distribution (place) can also be a challenge for an innovative new product. It may be necessary
to give retailers higher margins to convince them to stock the product, reducing the improved
margins that can be delivered by price skimming.
A final problem is that by price skimming, a firm may slow down the volume growth of demand
for the product. This can give competitors more time to develop alternative products ready for
the time when market demand (measured in volume) is strongest.

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Porter's Value Chain

The idea of the value chain is based on the process view of organisations, the idea of seeing a
manufacturing (or service) organisation as a system, made up of subsystems each with inputs,
transformation processes and outputs. Inputs, transformation processes, and outputs involve the
acquisition and consumption of resources - money, labour, materials, equipment, buildings, land,
administration and management. How value chain activities are carried out determines costs and
affects profits.

Most organisations engage in hundreds, even thousands, of activities in the process of converting
inputs to outputs. These activities can be classified generally as either primary or support
activities that all businesses must undertake in some form.
According to Porter (1985), the primary activities are:
1.
2.
3.
4.
5.

Inbound Logistics - involve relationships with suppliers and include all the activities
required to receive, store, and disseminate inputs.
Operations - are all the activities required to transform inputs into outputs (products and
services).
Outbound Logistics - include all the activities required to collect, store, and distribute
the output.
Marketing and Sales - activities inform buyers about products and services, induce
buyers to purchase them, and facilitate their purchase.
Service - includes all the activities required to keep the product or service working
effectively for the buyer after it is sold and delivered.

Secondary activities are:

1.
2.

Procurement - is the acquisition of inputs, or resources, for the firm.

Human Resource management - consists of all activities involved in recruiting, hiring,
training, developing, compensating and (if necessary) dismissing or laying off personnel.
3. Technological Development - pertains to the equipment, hardware, software, procedures
and technical knowledge brought to bear in the firm's transformation of inputs into
outputs.

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4.

Infrastructure - serves the company's needs and ties its various parts together, it consists
of functions or departments such as accounting, legal, finance, planning, public affairs,
government relations, quality assurance and general management.

Marketing plan
Product specific, market specific, or company-wide plan that describes activities involved in achieving
specific marketing objectives within a set timeframe. A market plan begins with the identification
(through market research) of specific customer needs and how the firm intends to fulfill them while generating
an acceptable level of return. It generally includes analysis of the current market situation
(opportunities and trends) and detailed action programs, budgets, sales forecasts, strategies, and projected
(proforma) financial statements. See also marketing strategy.

Characteristics of Good Marketing Research

The duty of marketing research is to solve the problems of the organization relating to its sales
and related marketing issues. As such it is considered to be a primary tool by several
managements and as a secondary tool by much management. In spite of its drawback of arriving
at exact results with complete accuracy, corporate world has accepted its relevance. One such
drawback posed against marketing research is its cost-effectiveness. If the tools used are crisp
and less costlier its service could be welcomed by all. For such recognition marketing research
must possess certain characteristics, which are mentioned by Philip Kotler as follows:
1. Scientific method: Competent marketing research is characterized by an attempt to follow the
scientific method, careful observation, formulation of hypotheses, prediction and testing.
2. Research creativity: At its best, marketing research develops innovative ways to solve a
problem.
3. Multiple methods: Competent marketing researchers keep away from over reliance on any
one method, preferring to adopt the method to the problem rather than the other way round. They
also recognize the desirability of the simultaneous gathering of information in different ways to
give greater confidence than any one method would provide.
4. Interdependence of models and data: Competent marketing researchers recognize that the
facts do not speak for themselves but rather derive their meaning from models of the problem.
They attempt to guide their search for information on the basis of causal decision model to help
the executive.

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Steps in marketing research

Strategic planning
A key function of the Management Committee is to determine the direction and scope of the organisation over the longer term.
This is usually reviewed on a 3 or 5 year basis through a process called strategic planning.
Strategic planning is the process of:

clarifying what the organisation is about;

deciding what is and is not a priority for the use of resources;
analysing the internal and external environment;
considering how best to deal with upcoming changes and transitions;
setting out a clear direction; and
setting concrete goals for the future.
Strategic planning involves looking at the organisation as a complete entity and is concerned with its long term development.
This involves looking at where the organisation is now, determining where you want to get to, and mapping how to get there.

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The strategic plan should be summarised in a written document to ensure that all concerned are clear regarding the aims and
objectives the organisation is working towards.

Buying decision process

Marketing information system (MIS)

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A marketing information system (MIS) is a set of procedures and methods designed to

generate, analyze, disseminate, and store anticipated marketing decision information on a
regular, continuous basis. An information system can be used operationally, managerially,
and strategically for several aspects of marketing.
A marketing information system can be used operationally, managerially, and
strategically for several aspects of marketing.
We all know that no marketing activity can be carried out in isolation, know when we say
it doesnt work in isolation that means there are various forces could be external or
internal, controllable or uncontrollable which are working on it. Thus to know which
forces are acting on it and its impact the marketer needs to gathering the data through its
own resources which in terms of marketing we can say he is trying to gather the market
information or form amarketing information system.
This collection of information is a continuous process that gathers data from a variety of
sources synthesizes it and sends it to those responsible for meeting the market places
needs. The effectiveness of marketing decision is proved if it has a strong information
system offering the firm a Competitive advantage. Marketing Information should not be
approached in an infrequent manner. If research is done this way, a firm could face these
risks:
1.
2.
3.
4.
5.
6.
7.
8.

Opportunities may be missed.

There may be a lack of awareness of environmental changes and competitors
actions.
Data collection may be difficult to analyze over several time periods.
Marketing plans and decisions may not be properly reviewed.
Data collection may be disjointed.
Previous studies may not be stored in an easy to use format.
Time lags may result if a new study is required.
Actions may be reactionary rather than anticipatory.

Factors Affecting the Choice of Channels of Distribution

(A) Considerations Related to Product
When a manufacturer selects some channel of distribution he/she should take care of such factors
which are related to the quality and nature of the product. They are as follows:
1. Unit Value of the Product:
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When the product is very costly it is best to use small distribution channel. For example,
Industrial Machinery or Gold Ornaments are very costly products that are why for their
distribution small distribution channel is used. On the other hand, for less costly products long
distribution channel is used.
2. Standardised or Customised Product:
Standardised products are those for which are pre-determined and there has no scope for
alteration. For example: utensils of MILTON. To sell this long distribution channel is used.
On the other hand, customised products are those which are made according to the discretion of
the consumer and also there is a scope for alteration, for example; furniture. For such products
face-to-face interaction between the manufacturer and the consumer is essential. So for these
Direct Sales is a good option.
3. Perishability:
A manufacturer should choose minimum or no middlemen as channel of distribution for such an
item or product which is of highly perishable nature. On the contrary, a long distribution channel
can be selected for durable goods.
4. Technical Nature:
If a product is of a technical nature, then it is better to supply it directly to the consumer. This
will help the user to know the necessary technicalities of the product.
(B) Considerations Related to Market
Market considerations are given below:
1. Number of Buyers:
If the number of buyer is large then it is better to take the services of middlemen for the
distribution of the goods. On the contrary, the distribution should be done by the manufacturer
directly if the number of buyers is less.
2. Types of Buyers:
Buyers can be of two types: General Buyers and Industrial Buyers. If the more buyers of the
product belong to general category then there can be more middlemen. But in case of industrial
buyers there can be less middlemen.
3. Buying Habits:

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A manufacturer should take the services of middlemen if his financial position does not permit
him to sell goods on credit to those consumers who are in the habit of purchasing goods on
credit.
4. Buying Quantity:
It is useful for the manufacturer to rely on the services of middlemen if the goods are bought in
smaller quantity.
5. Size of Market:
If the market area of the product is scattered fairly, then the producer must take the help of
middlemen.
(C) Considerations Related to Manufacturer/Company
Considerations related to manufacturer are given below:
1. Goodwill:
Manufacturers goodwill also affects the selection of channel of distribution. A manufacturer
enjoying good reputation need not depend on the middlemen as he can open his own branches
easily.
2. Desire to control the channel of Distribution:
A manufacturers ambition to control the channel of distribution affects its selection. Consumers
should be approached directly by such type of manufacturer. For example, electronic goods
sector with a motive to control the service levels provided to the customers at the point of sale
are resorting to company owned retail counters.
3. Financial Strength:
A company which has a strong financial base can evolve its own channels. On the other hand,
financially weak companies would have to depend upon middlemen.
(D) Considerations Related to Government
Considerations related to the government also affect the selection of channel of distribution. For
example, only a license holder can sell medicines in the market according to the law of the
government.
In this situation, the manufacturer of medicines should take care that the distribution of his
product takes place only through such middlemen who have the relevant license.
(E) Others
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1. Cost:
A manufacturer should select such a channel of distribution which is less costly and also useful
from other angles.
2. Availability:
Sometimes some other channel of distribution can be selected if the desired one is not available.
3. Possibilities of Sales:
Such a channel which has a possibility of large sale should be given weight age.

Personal selling and its pros and cons

Personal selling is the process of communicating with a potential buyer (or buyers) face-to-face
with the purpose of selling a product or service. The main thing that sets personal selling apart
from other methods of selling is that the salesperson conducts business with the customer in
person. Though personal selling is more likely to be effective with certain types of products or
services, it has important applications for nearly all kinds of small businesses. In fact, most of
history's successful entrepreneurs have been skilled salespeople, able to represent and promote
their companies and products in the marketplace.
Personal selling is one part of a company's promotion mix, along with advertising, sales
promotion, and public relations. Advertising is any form of paid sales presentation that is not
done face-to-face. Television and radio commercials, newspaper and magazine advertisements,
and direct mail inserts are well-known forms of advertising. Sales promotion is the use of
incentivessuch as coupons, discounts, rebates, contests, or special displaysto entice a
customer to buy a product or service. Public relations is the act of building up a company's image
in the eyes of the community in the hopes of translating the feelings of goodwill into sales. An
example of public relations might include a company sponsoring a charity event.
Personal selling offers entrepreneurs both advantages and disadvantages in comparison with the
other elements of the promotion mix. On the positive side, personal selling allows the
salesperson to target the message specifically to the audience and receive immediate feedback. In
this way, it is more precise than other forms of promotion and often has a greater persuasive
impact. Conversely, personal selling cannot reach as many potential customers as advertising,
plus the cost of each contact is much higher. Another advantage is that personal selling can be an
important source of marketing information. Salespeople may learn about competitors' products,
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for example, or about emerging customer needs that may lead to the development of a new
product. If the sales force is well trainedacting as problem solvers and advisors for customers
rather than using hard-sell tacticspersonal selling may help a small business build loyal, longterm relationships with customers.
A small business may choose to use any or all of the promotion mix elements in selling its
products. Deciding how to allocate resources for each component involves a number of factors.
Some of the things entrepreneurs should consider when deciding on the ideal promotion mix
include the type of product or service, the value of the product or service, and the budget allotted
for marketing.

Marketing research system

Marketing research is "the process or set of processes that links the consumers, customers, and end users to
the marketer through information information used to identify and define marketing opportunities and
problems; generate, refine, and evaluate marketing actions; monitor marketing performance; and improve
understanding of marketing as a process. Marketing research specifies the information required to address
these issues, designs the method for collecting information, manages and implements the data collection
process, analyzes the results, and communicates the findings and their implications." [1]
It is the systematic gathering, recording, and analysis of qualitative and quantitative data about issues relating
tomarketing products and services. The goal of marketing research is to identify and assess how changing
elements of the marketing mix impacts customer behavior. The term is commonly interchanged with market
research; however, expert practitioners may wish to draw a distinction, in that market research is concerned
specifically with markets, whilemarketing research is concerned specifically about marketing processes.[2]
Marketing research is often partitioned into two sets of categorical pairs, either by target market:

Consumer marketing research, and

Business-to-business (B2B) marketing research

Or, alternatively, by methodological approach:

Qualitative marketing research, and

Quantitative marketing research

Consumer marketing research is a form of applied sociology that concentrates on understanding the
preferences, attitudes, and behaviors of consumers in a market-based economy, and it aims to understand the
effects and comparative success of marketing campaigns. The field of consumer marketing research as a
statistical science was pioneered by Arthur Nielsen with the founding of the ACNielsen Company in 1923.[3]
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Thus, marketing research may also be described as the systematic and objective identification, collection,
analysis, and dissemination of information for the purpose of assisting management in decision making related
to the identification and solution of problems and opportunities in marketing

Direct Distribution
Direct distribution leads to lower prices for the consumer. Since the product is only marked up
once, the selling price is much cheaper. As a result, consumers that purchase a product directly
from the wholesaler or manufacturer will pay much less for a product.
Unfortunately, this is a very narrow view of the selling process. It would be very detrimental for
the economy to use only direct distribution. First and foremost, wholesalers and manufactures
are experts in creating the product. They do not have expertise in customer relations and
individual consumer distribution. This is why the middle man exists. The benefits of a middle
man will be discussed further in the blog.
While direct distribution is very appealing due to low prices, it can be far from efficient. There is
a legitimate reason why many manufacturers and wholesalers do not distribute directly in order
to gain competitive advantage. They are not adept in business to consumer type selling. Instead,
they rather sell in bulk to another business. It will be that business who will have expertise in
selling to consumers. These businesses will have proper logistics and consumer relations in order
to support high individual demand whereas manufactures and wholesales do not have similar
capacities.

Indirect Distribution
Indirect distribution has many advantages. That is why a large portion of the economy uses
indirect distribution to sell products. Different firms specialize in different categories; it is very
difficult to specialize in all the aspects of the product cycle. Thus, firms decide to focus on what
they specialize in and use outside companies for the other tasks.
Manufacturers generally are experts in business to business relations. They know how to adjust
prices due to bulk purchases and they know how to use raw materials to create products. This is
where their expertise ends. Thus, they choose to sell their products at a profit to middle men.
They are happy with the profit they are making. Furthermore, their whole operation remains
efficient instead of only a portion.

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The middle men understand consumer demand. They understand how to sell the product to the
consumer. Moreover, they understand how to deal with consumer criticism and disapproval. The
manufactures do not specialize in this area and prefer that the middle man handle individual
consumer issues.

Marketing orientation
Businesses can develop new products based on either a marketing orientated approach or a product
orientated approach.
A marketing orientated approach means a business reacts to what customers want. The decisions taken are
based around information about customers needs and wants, rather than what the business thinks is right for
the customer. Most successful businesses take a market-orientated approach.
A product orientated approach means the business develops products based on what it is good at making or
doing, rather than what a customer wants. This approach is usually criticised because it often leads to
unsuccessful products - particularly in well-established markets.
Most markets are moving towards a more market-orientated approach because customers have become
more knowledgeable and require more variety and better quality. To compete, businesses need to be more
sensitive to their customers needs otherwise they will lose sales to their rivals.
On the other hand some products are argued to create a need or want in the customer, especially products with
a very high technological content. Mobile phones have moved from being a business accessory to being a big
consumer brand item, with many additional gadgets, such as pictures, video and Internet access. Innovations
create the need rather than the customer being able to second-guess how new technology is going to develop.

Selling Orientation
It is an organization operating model in which the organization focuses on the needs required for
selling in the market that is, an organization whose operating structure is based on the selling
efficiency rather than customer needs and product orientation.
Sales oriented companies primarily use two types of promotion to communicate their message.
They use advertising to make customer aware of their product and along with it they use personal
selling to make customer take action and buy their product.
A sales orientation strategy focuses on selling and promotions of the product with the viewpoint
of selling as much as possible of existing. This type of orientation works when customers are not
expecting anything different in the product from the company, when demand of a particular
product is very high or when company has large stock of inventory that they want to sell
immediately.
Companies that use sales orientation approach put a higher premium on short term selling than
on long term relations with their consumer base. They are so involved in selling that they miss
the opportunity to improve their product or serve their customer in a better manner.
There are two kinds of external marketing environments; micro and macro. These environments factors are
beyond the control of marketers but they still influence the decisions made when creating a strategic marketing
strategy.

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Micro Environment Factors

The suppliers: Suppliers can control the success of the business when they hold the power. The
supplier holds the power when they are the only or the largest supplier of their goods; the buyer is not
vital to the suppliers business; the suppliers product is a core part of the buyers finished product
and/or business.

The resellers: If the product the organisation produces is taken to market by 3rd party resellers or
market intermediaries such as retailers, wholesalers, etc. then the marketing success is impacted by
those 3rd party resellers. For example, if a retail seller is a reputable name then this reputation can be
leveraged in the marketing of the product.

The customers: Who the customers are (B2B or B2C, local or international, etc.) and their reasons for
buying the product will play a large role in how you approach the marketing of your products and
services to them.

The competition: Those who sell same or similar products and services as your organisation are your
market competition, and they way they sell needs to be taken into account. How does their price and
product differentiation impact you? How can you leverage this to reap better results and get ahead of
them?

The general public: Your organisation has a duty to satisfy the public. Any actions of your company
must be considered from the angle of the general public and how they are affected. The public have
the power to help you reach your goals; just as they can also prevent you from achieving them.

Macro Environment Factors

Demographic forces: Different market segments are typically impacted by common demographic
forces, including country/region; age; ethnicity; education level; household lifestyle; cultural
characteristics and movements.

Economic factors: The economic environment can impact both the organisations production and the
consumers decision making process.

Natural/physical forces: The Earths renewal of its natural resources such as forests, agricultural
products, marine products, etc must be taken into account. There are also the natural non-renewable
resources such as oil, coal, minerals, etc that may also impact the organisations production.

Technological factors: The skills and knowledge applied to the production, and the technology and
materials needed for production of products and services can also impact the smooth running of the
business and must be considered.

Political and legal forces: Sound marketing decisions should always take into account political and/or
legal developments relating to the organisation and its markets.

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Social and cultural forces: The impact the products and services your organisations brings to market
have on society must be considered. Any elements of the production process or any products/services
that are harmful to society should be eliminated to show your organisation is taking social
responsibility. A recent example of this is the environment and how many sectors are being forced to
review their products and services in order to become more environmentally friendly.

Micro and macro environments have a significant impact on the success of marketing campaigns, and therefore
the factors of these environments should be considered in-depth during the decision making process of a
strategic marketer. Considering these factors will improve the success of your organisations marketing
campaign and the reputation of the brand in the long term.

Perfect competition
Perfect competition is a market structure where many firms offer a homogeneous product. Because
there is freedom of entry and exit and perfect information, firms will make normal profits and prices
will be kept low by competitive pressures.

Features of perfect competition

1.
2.
3.
4.
5.

Many firms.
Freedom of entry and exit; this will require low sunk costs.
All firms produce an identical or homogeneous product.
All firms are price takers, therefore the firms demand curve is perfectly elastic.
There is perfect information and knowledge..

Perfect competition exists when there are many consumers buying a standardized product from
numerous small businesses. Because no seller is big enough or influential enough to affect price,
sellers and buyers accept the going price. For example, when a commercial fisher brings his fish
to the local market, he has little control over the price he gets and must accept the going rate.

The Basics of Supply and Demand

To appreciate how perfect competition works, we need to understand how buyers and sellers
interact in a market to set prices. In a market characterized by perfect competition, price is
determined through the mechanisms of supply and demand. Prices are influenced both by the
supply of products from sellers and by the demand for products by buyers.
To illustrate this concept, lets create a supply and demand schedule for one particular good sold
at one point in time. Then well define demand and create a demand curve, and define supply and
create a supply curve. Finally, well see how supply and demand interact to create an equilibrium
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pricethe price at which buyers are willing to purchase the amount that sellers are willing to
sell.
Demand and the Demand Curve
Demand is the quantity of a product that buyers are willing to purchase at various prices. The
quantity of a product that people are willing to buy depends on its price. Youre typically willing
to buy less of a product when prices rise and more of a product when prices fall. Generally
speaking, we find products more attractive at lower prices, and we buy more at lower prices
because our income goes further.
Figure 1.7 The Demand Curve

Using this logic, we can construct a demand curve that shows the quantity of a product that will
be demanded at different prices. Lets assume that the diagram in Figure 1.7 "The Demand
Curve" represents the daily price and quantity of apples sold by farmers at a local market. Note
that as the price of apples goes down, buyers demand goes up. Thus, if a pound of apples sells
for $0.80, buyers will be willing to purchase only fifteen hundred pounds per day. But if apples
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cost only $0.60 a pound, buyers will be willing to purchase two thousand pounds. At $0.40 a
pound, buyers will be willing to purchase twenty-five hundred pounds.
Supply and the Supply Curve
Supply is the quantity of a product that sellers are willing to sell at various prices. The quantity
of a product that a business is willing to sell depends on its price. Businesses are more willing to
sell a product when the price rises and less willing to sell it when prices fall. Again, this fact
makes sense: businesses are set up to make profits, and there are larger profits to be made when
prices are high.
Figure 1.8 The Supply Curve

Now we can construct a supply curve that shows the quantity of apples that farmers would be
willing to sell at different prices, regardless of demand. As you can see in Figure 1.8 "The Supply
Curve", the supply curve goes in the opposite direction from the demand curve: as prices rise, the
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quantity of apples that farmers are willing to sell also goes up. The supply curve shows that
farmers are willing to sell only a thousand pounds of apples when the price is $0.40 a pound, two
thousand pounds when the price is $0.60, and three thousand pounds when the price is $0.80.
Equilibrium Price
We can now see how the market mechanism works under perfect competition. We do this by
plotting both the supply curve and the demand curve on one graph, as weve done in Figure 1.9
"The Equilibrium Price". The point at which the two curves intersect is the equilibrium price. At
this point, buyers demand for apples and sellers supply of apples is in equilibrium.
Figure 1.9 The Equilibrium Price

You can see in Figure 1.9 "The Equilibrium Price" that the supply and demand curves intersect at
the price of $0.60 and quantity of two thousand pounds. Thus, $0.60 is the equilibrium price: at
this price, the quantity of apples demanded by buyers equals the quantity of apples that farmers
are willing to supply. If a farmer tries to charge more than $0.60 for a pound of apples, he wont
sell very many and his profits will go down. If, on the other hand, a farmer tries to charge less
than the equilibrium price of $0.60 a pound, he will sell more apples but his profit per pound will
be less than at the equilibrium price.
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The Difference between the Private and Public Sector

It is important to understand the difference between the private sector andpublic sector because
your privacy rights will differ depending on the legislation that an organization is governed
under.
The Private Sector
The private sector is usually composed of organizations that are privately owned and not part of
the government. These usually includes corporations (both profit and non-profit), partnerships,
and charities.
An easier way to think of the private sector is by thinking of organizations that are not owned or
operated by the government. For example, retail stores, credit unions, and local businesses will
operate in the private sector.
The Public Sector
The public sector is usually composed of organizations that are owned and operated by the
government. This includes federal, provincial, state, or municipal governments, depending on
where you live. Privacy legislation usually calls organizations in the public sector a public
body or a public authority.
Some examples of public bodies in Canada and the United Kingdom are educational bodies,
health care bodies, police and prison services, and local and central government bodies and their
departments.

FACTORS CONTRIBUTING TO NEW PRODUCT

DEVELOPMENT
Several factors contribute to new product development. While most are related to external
environmental variables, the most important internal factor in new product development is the
surplus capacity that a firm may have at any given time. Although firms should not pick up
product to fill their surplus capacities, the fact is that too many do. Consider the example of
Godrej soaps that launched a series of new brands of toilet soap, mainly to fill its existing surplus
capacity, once Ponds walked out of Godrejs manufacturing program. However, there are
several environmental factors contributing development of new products.

Changing customer preferences:

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The driving force in new product- development is the changing customer life-style, leading
towards a change in the customers preferences and expectations. The changing role of
women, growth in the nuclear and stand alone families, increase in education and income levels,
and a manifold increase in the electronic media also contributes towards changing
customers expectations and preferences. Most of todays new products , be they garments,
footwear, leather wears, perfumes, designer wears, appliances and other durables and even credit
cards, are the result of this change in consumer life style and preferences.

Technological Changes:
Another factor is the technological changes in the industry and the market. For example ,if Mrs.
Indira Gandhis government had not decided to expand the television network to cover 70% of
the Indian population, launched its own Satellite INSAT 1B and started color telecast in 1982, it
is extremely doubtful if many of todays product would have seen the light of the day in the
Indian market. As an example , Maggi noodles wouldnt have been so successful.
Application of chips technology to the watch- making industry gave us a quartz watch- some
thing which Titan watches have successfully used to shake up the Indian market.
To take advantage of the technological changes and remain competitive, the firm has to have a
closer relationship with technological institutes, universities and other R&D labs.

Government Policy:
The government policy also can encourage or foster new product development process. for
example, a government policy encouraging competition and entrepreneurship can motivate firms
to launch new products. a case in point is , after the government of India allowed board bending
in its industrial licensing policy and Maruti became a rage with Indian consumers, Hindustan
Motors and Premier Automoblies started analyzing means to improve their own market position.
they launched two new products, each of which was targeted at the higher end of the market
(Hindustan Motors Contessa and Premiers 118 NE are result of the government policy
encouraging competition in one automobile sector). Similarly,
Government policy insisting on chemical firms for an environmental audit, has led to a growth in
the demand for pollution control equipment.

Characteristics of marketing manager

To make it as a successful marketing manager, there are many traits that you need to have. It
no longer is just about understanding and delivering in a marketing capacity, but more
importantly being able to understand the fundamentals of business and have an ability to execute
the companys business plan from a sales and marketing perspective.
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Marketing Managers today are very different to a marketing manager 10 years ago. While
having an overarching capability to ensure that your team delivers the marketing plan as it was
meant to be delivered, it is also equally as imperative to be kept up to date with the latest in
marketing techniques, changes in economic and political environments and an ability to work
closely in partnership with sales professionals.
Here are some characteristics that a successful marketing manager should possess:
Vision
A strong vision for what they want to accomplish for the brand in the short-term and long term
and an ability to articulate this vision across multiple platforms and communications channels.
Strategic Thinking
Being able to develop a marketing strategy that is in line with the overall business strategy and
think strategically in all aspects of marketing is not only something that a Marketing Manager
needs to possess it is also a deal breaker. If a Marketing Manager is not a strategic thinker, then
they are simply not a Marketing Manager and another role would be best suited to their
capabilities. A Marketing Manager needs to have a firm understanding of market trends, be able
to develop a targeted marketing strategy and meet company goals.
Business Acumen
The marketing department must understand and deliver on the overall company business plan.
That means understanding the fundamentals and influencers of business. Knowing the market,
what makes it tick, how it is going to develop, change and evolve is paramount. A successful
Marketing Manager can drive business and improve growth through innovative business
solutions.
Customer Centric
A successful Marketing Manager needs to be in bed with the customer. They need to understand
every aspect of the customers traits, likes, dislikes and drivers. Being in bed with the customers
means sharing the covers, adapting to habits that are not always appealing like snoring, and
understanding each others sleeping patterns. It means knowing if the first thing the customers
does in the morning is pick up their Blackberry or iphone or whether they wake in the middle of
the night to have a drink or go to the toilet. All high level Marketing Managers walk in their
customers shoes regularly to understand how it feels like to be the customer. They take on board
feedback and adapt product and service delivery accordingly. A Marketing Manager also knows
who to target and when with capabilities of finding the customer no matter where they may be
hiding.
Brand Champion

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Passion for your brand is a deal breaker. If you dont love your brand, you cant market it.
Inspiring your team, customers and the market to love your brand is about inspiring them and
seeing the passion alive in every single brand touch point.
Personality
A bit of personality goes a long way in marketing. When you speak with an entrepreneur or
business leader and ask them about the personality of their favourite marketing manager, the
answer will always be along the lines of 'having a great personality, straight-forward, strategic
and a bit of fun'. Remember, as a marketing manager, you are not an accountant or lawyer.
People expect you to be well presented, on top of your game, innovative and confident.

Product Planning
In order to maximize his sales revenue and profits, a business firm must continuously adjust and
adapt its products and services to the changing requirements of customers. From time-to- time, it
may have to design and develop new products.
Product planning is the process of searching ideas for new products, screening them
systematically, converting them into tangible products and introducing the new product in the
market. It also involves the formation of product policies and strategies.
Product planning includes improvements in existing products as well as deletion of unprofitable
or marginal products. It also encompasses product design and engineering which is also called
product development. Product planning comprises all activities starting with the conception of
product idea and ending up with full scale introduction of the product in the market.
It is a complex process requiring effective coordination between different departments of the
firm. It is intimately related with technical operations of the organisation, particularly with
engineering, research and development departments

THE MARKETING MIX FROM 4 PS TO 7 PS

Marketing is a continually evolving discipline and as such can be one that companies find
themselves left very much behind the competition if they stand still for too long. One example of
this evolution has been the fundamental changes to the basic Marketing mix. Where once there
were 4 Ps to explain the mix, nowadays it is more commonly accepted that a more developed 7
Ps adds a much needed additional layer of depth to the Marketing Mix with some theorists going
even going further.Before we get carried away though what is the Marketing Mix and what is the
original 4 Ps principle?

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THE MARKETING MIX

Simply put the Marketing Mix is a tool used by businesses and Marketers to help
determine a product or brands offering. The marketing mix is one of the most famous marketing
terms. The marketing mix is the tactical or operational part of a marketing plan. The marketing mix is
also called the 4Ps and the 7Ps. The 4Ps are price, place, product and promotion. The services
marketing mix is also called the 7Ps and includes the addition of process, people and physical
evidence.

THE MARKETING MIX 4 PS:

Product - The Product should fit the task consumers want it for, it should work
and it should be what the consumers are expecting to get.

Place The product should be available from where your target consumer finds it
easiest to shop. This may be High Street, Mail Order or the more current option via ecommerce or an online shop.

Price The Product should always be seen as representing good value for money.
This does not necessarily mean it should be the cheapest available; one of the main
tenets of the marketing concept is that customers are usually happy to pay a little
more for something that works really well for them.

Promotion Advertising, PR, Sales Promotion, Personal Selling and, in more

recent times, Social Media are all key communication tools for an organisation. These
tools should be used to put across the organisations message to the correct audiences
in the manner they would most like to hear, whether it be informative or appealing to
their emotions.

In the late 70s it was widely acknowledged by Marketers that the Marketing Mix should
be updated. This led to the creation of the Extended Marketing Mix in 1981 by Booms &
Bitner which added 3 new elements to the 4 Ps Principle. This now allowed the extended
Marketing Mix to include products that are services and not just physical things.

THE EXTENDED 7 PS:

People All companies are reliant on the people who run them from front line
Sales staff to the Managing Director. Having the right people is essential because they
are as much a part of your business offering as the products/services you are offering.

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Processes The delivery of your service is usually done with the customer present
so how the service is delivered is once again part of what the consumer is paying for.

Physical Evidence Almost all services include some physical elements even if
the bulk of what the consumer is paying for is intangible. For example a hair salon
would provide their client with a completed hairdo and an insurance company would
give their customers some form of printed material. Even if the material is not
physically printed (in the case of PDFs) they are still receiving a physical product
by this definition.

Though in place since the 1980s the 7 Ps are still widely taught due to their fundamental
logic being sound in the marketing environment and marketers abilities to adapt the
Marketing Mix to include changes in communications such as social media, updates in
the places which you can sell a product/service or customers expectations in a constantly
changing commercial environment.

Concept and Component of Marketing Information System

A marketing information system (MKIS) is defined a set of procedures and methods designed to generate,
analyze, disseminate, and store anticipated marketing decision information on a regular, continuous basis.
An information system can be used operationally, managerially, and strategically for several aspects of
marketing.
A Marketing Information System can also be defined as 'a system in which marketing data is formally
gathered, stored, analysed and distributed to managers in accordance with their informational needs on a
regular basis'
A marketing information system can be used operationally, managerially, and strategically for several
aspects of marketing.
As we all know that no marketing activity can be carried out in isolation, know when we say it doesnt
work in isolation that means there are various forces could be external or internal, controllable or
uncontrollable which are working on it. Thus to know which forces are acting on it and its impact the
marketer needs to gathering the data through its own resources which in terms of marketing we can say he
is trying to gather the market information or form a marketing information system. This collection of
information is a continuous process that gathers data from a variety of sources synthesizes it and sends it
to those responsible for meeting the market places needs. The effectiveness of marketing decision is
proved if it has a strong information system offering the firm a Competitive advantage.
Locating data and developing information
The information needed by marketing managers comes from various sources which includes: - internal
company records, marketing intelligence and marketing research. The information analysis system then
processes this information to make it more useful for managers.
Internal Records
These are information gathered from sources within the company to evaluate marketing performances and
to detect marketing problems and opportunities. Most marketing managers use internal records and
reports regularly, especially for making day-to-day planning, implementation and control decisions.
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Internal records information consists of information gathered from sources within the company to
evaluate marketing performance and to detect marketing problems and opportunities.
Information from internal records is usually quicker and cheaper to get than information from other
sources, but it also presents some problems. Because internal information was for other purposes, it may
be incomplete or in the wrong form for making marketing decisions. For example, accounting department
sales and cost data used for preparing financial statements need adapting for use in evaluating product,
sales force or channel performance.
Marketing Intelligence
The total information needs of the marketing department can be specified and satisfied via a marketing
intelligence network. The marketing intelligence system determines the intelligence needed, collects it by
searching the environment and delivers it to marketing managers who need it. Marketing intelligence
comes from many sources. Much intelligence is from the company's personnel - executives, engineers and
scientists, purchasing agents and the sales force. But company people are often busy and fail to pass on
important information. The company must 'sell' its people on their importance as intelligence gatherers,
train them to spot new developments and urge them to report intelligence hack to the company.
The company must also persuade suppliers, resellers and customers to pass along important intelligence.
Some information on competitors conies from what they say about themselves in annual reports,
speeches, press releases and advertisements. The company can also learn about competitors from what
others say about them in business publications and at trade shows. Or the company can watch what
competitors do - buying and analyzing competitors' products, monitoring their sales and checking for new
patents. Companies also buy intelligence information from outside suppliers.
Marketing research systems
Marketing research is a proactive search for information. That is, the enterprise which commissions these
studies does so to solve a perceived marketing problem. In many cases, data is collected in a purposeful
way to address a well-defined problem (or a problem which can be defined and solved within the course
of the study). The other form of marketing research centers not on a specific marketing problem but is an
attempt to continuously monitor the marketing environment. These monitoring or tracking exercises are
continuous marketing research studies, often involving panels of farmers, consumers or distributors from
which the same data is collected at regular intervals. Whilst the ad hoc study and continuous marketing
research differs in the orientation, yet they are both proactive.
Marketing Information should not be approached in an infrequent manner. If research is done this way, a
firm could face these risks:
1.Opportunities may be missed.
2.There may be a lack of awareness of environmental changes and competitors actions.
3.Data collection may be difficult to analyze over several time periods.
4.Marketing plans and decisions may not be properly reviewed.
5.Data collection may be disjointed.
6.Previous studies may not be stored in an easy to use format.
7.Time lags may result if a new study is required.
8.Actions may be reactionary rather than anticipatory.
Advantages of Marketing Information System
1. Organized data collection.
2. A broad perspective.
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3. The storage of important data.

4. An avoidance of crises.
5. Coordinated marketing plans.
6. Speed in obtaining sufficient information to make decisions.
7. Data amassed and kept over several time periods.
8. The ability to do a cost-benefit analysis.
The disadvantages of a Marketing information system are high initial time and labor costs and the
complexity of setting up an information system. Marketers often complain that they lack enough
marketing information or the right kind, or have too much of the wrong kind. The solution is an effective
marketing information system.
The marketing information systems and its subsystems

Marketing information systems are intended to support management decision making. Management has
five distinct functions and each requires support from an MIS. These are: planning, organising,
coordinating, decisions and controlling
Information systems have to be designed to meet the way in which managers tend to work. Research
suggests that a manager continually addresses a large variety of tasks and is able to spend relatively brief
periods on each of these. Given the nature of the work, managers tend to rely upon information that is
timely and verbal even if this is likely to be less accurate then more formal and complex information
systems.
Managers play at least three separate roles: interpersonal, informational and decisional. MIS, in electronic
form or otherwise, can support these roles in varying degrees. MIS has less to contribute in the case of a
manager's informational role than for the other two.
Three levels of decision making can be distinguished from one another: strategic, control (or tactical) and
operational. Again, MIS has to support each level. Strategic decisions are characteristically one-off
situations. Strategic decisions have implications for changing the structure of an organisation and
therefore the MIS must provide information which is precise and accurate. Control decisions deal with
broad policy issues and operational decisions concern the management of the organisation's marketing
mix.
A marketing information system has four components: the internal reporting system, the marketing
research systems, the marketing intelligence system and marketing models. Internal reports include orders
received, inventory records and sales invoices. Marketing research takes the form of purposeful studies
either ad hoc or continuous. By contrast, marketing intelligence is less specific in its purposes, is chiefly

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carried out in an informal manner and by managers themselves rather than by professional marketing
researchers.

Importance of Product Packaging in Marketing

Whether youre getting ready to create packaging for a product youre selling or youre considering changing the
packaging of an existing product, you may be wondering if the appearance of a products package is important.
Many product providers may think that the product and its performance is more important than what the packaging
looks like, but the product packaging can play a role in the success or failure of the sales of the product.

Function
The purpose of product packaging is to protect the product from damage. Product packaging not only protects the
product during transit from the manufacturer to the retailer, but it also prevents damage while the product sits on
retail shelves. Most products have some form of packaging. For example, soups must have a container and package
while apples may have packaging for transport but not to sell the product from the produce department of the local
grocery store.

Attraction
How a product is packaged may be what attracts the consumer to take a look on the product as is sits on store
shelves. For this reason, many companies conduct extensive research on color schemes, designs and types of
product packaging that is the most appealing to its intended consumer.

Promotion
Packaging also plays an important role for portraying information about the product. Outside packaging may contain
directions on how to use the product or make the product.

Facilitates Purchase Decision

Packaging may also contain ingredients and nutritional information about the product. This information can help to
sell the product because it allows potential customers to obtain the necessary information they need to make a
purchase decision. Information contained on a package may propel the reader to buy the product without ever
having to speak to a store clerk.

Differentiation
Packaging can also differentiate one brand of product from another brand. Because the product packaging can
contain company names, logos and the color scheme of the company, it helps consumers to identify the product as it
sits among the competitions products on store shelves. For example, as a shopper walks through the coffee aisle of
the local grocery store, the bright orange, pink and white packaging of the Dunkin Donuts coffee brand may be
easily recognizable for the consumer to grab on his way by the coffee shelf. The shopper may identify with the
company brand, which propels them to buy the product. If the product packaging changes, it may alter the brand
perception of the company, which doesnt mean that the consumer would not still purchase the product, but it may
delay the purchase until the person is able to identify the product according to its new packaging.

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Industrial market
consumer group composed of companies or organizations that purchase goods and services for
use in the production of other goods and services that are sold, rented, or supplied to others. For
example, the clothing manufacturing industry purchases fabric that is used in the production of
dresses and other apparel. Fabric manufacturers are also members of the industrial market
because they purchase other raw materials for use in the production of the fabric. The industrial
market is the largest and most diverse organizational market, consisting of more than 13 million
organizations that buy more than $3 trillion worth of products each year. Some of the major
industries represented in the industrial market are construction, agriculture, mining,
manufacturing, communication, public utilities, transportation, and finance.

Five Stages of the Business Buying Decision Process

The business buying decision process involves five distinct stages. At each stage, different
decision makers may be involved, depending on the cost and strategic importance of the
purchase. To navigate the buying decision process successfully, you need to provide the right
type of information and ensure that your sales representatives are contacting the right decision
makers. You can also strengthen your position by offering customers advice and guidance at each
stage a process known as consultative selling.
Awareness
The process begins when a company identifies a need for a purchase. It may want to replace an
existing item, replenish stocks or buy a new product that is just available on the market. You can
also stimulate a need that the company may not be aware of by advising them of issues and
challenges that other companies in their industry face. The buying team next works with the
requesting department to firm up on the requirement. Your sales team can provide advice and
guidance at this stage by offering discussion papers or inviting decision makers to workshops or
seminars on the topic.
Specification
When the buying team has agreed requirements, it prepares a detailed specification that sets out
quantities, performance and technical requirements for a product. Your sales team can support
this stage by advising the buying team on best practice or collaborating with the buying team to
develop the specification. Buying teams then use the specification to search for potential
suppliers. They may search the Internet to find products or companies that provide a match to
their specification, so it is important that your website features keywords that match your
customers product or service needs.
Proposals

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When the buying team has identified potential suppliers, it asks for detailed proposals from the
suppliers. The team may issue a formal document known as a request for proposal, or it may
outline requirements and invite potential suppliers to make a presentation or submit a quotation.
If the product or service has a precise specification, the buying team may simply ask for price
quotations. If the product is more complex, it may ask for proposals on how a supplier would
meet the need.
Evaluation
The buying team evaluates suppliers proposals against criteria such as price, performance and
value for money. As well as evaluating the product, they assess the supplier on factors such as
corporate reputation, financial stability, technical reputation and reliability. You can influence
decisions at this stage by providing company information, case studies and independent reports
that review your company and products.
Order
Before the buying team places an order with the chosen supplier, they negotiate price, discount,
finance arrangements and payment terms, as well as confirming delivery dates and any other
contractual matters. When the order is complete and delivered, the buying team may add a
further stage by reviewing the performance of the product and the supplier. This stage may
include imposition of penalty charges if the product fails to meet the agreed specification.

Seven Functions of Marketing

Business owners everywhere recognize that if they want to make money, they have to sell their
products or services. But what you might not know is that there are actually seven functions of
marketing that span everything from distribution to pricing.
Distribution
Distribution is about deciding how you'll get the goods or services you want to sell to the people
who want to buy them. Having an idea for a product is great, but if you aren't able to get that
product to the customers you aren't going to make money. Distribution can be as easy as setting
up shop in the part of a city where your target customers are -- but in an increasingly
interconnected world, distribution more often than not now means that you'll need to take your
products or services to the customers.
Financing
It takes money to make money. As a business owner, an important function of marketing a
product is finding the money through investments, loans, or your personal capital to finance the
creation and advertising of your goods or services.
Market Research
Market research is about gathering information concerning your target customers. Who are the
people you want to sell to? Why should they buy from you as opposed to a rival business?
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Answering these questions requires that you do some on-the-ground observation of the market
trends and competing products.
Pricing
Setting the correct price for your product or service can be a challenge. If you price it too high,
you might lose customers -- but if you price it too low you might be robbing yourself of profits.
The "right" price normally comes through trial and error and doing some market research.
Product and Service Management
Once you've determined the target market and set the price of your product or service, the goal
becomes to effectively manage the product or service. This involves listening to customers,
responding to their wants and needs, and keeping your products and services fresh and up to
date.
Promotion
Most business owners are familiar with the idea of promotion. Advertising your products and
services is essential to attracting new customers and keeping existing customers coming back. As
the marketplace changes, you'll want to respond appropriately by tailoring your promotion
messages to new media (such as Facebook or Twitter), by sticking with more conventional
outlets -- or by using a mix of the old and new.
Selling
While we tend to think of selling and marketing as being closely linked, selling is last on the list
of the seven functions of marketing. This is because selling can happen only after you've
determined the wants and needs of your customer base and are able to respond with the right
products at the right price point and time frame.

Market
An actual or nominal place where forces of demand and supply operate, and
where buyers and sellers interact (directly or through intermediaries) to trade goods, services,
or contracts or instruments, for money or barter.
Markets include mechanisms or means for (1) determining price of the traded item, (2)
communicating the price information, (3) facilitating deals and transactions, and (4)
effecting distribution. The market for a particular item is made up of existing and
potential customers who need it and have the ability and willingness to pay for it.

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Why is competition policy important for consumers?

Competition policy is about applying rules to make sure businesses and companies compete
fairly with each other. This encourages enterprise and efficiency, creates a wider choice for
consumers and helps reduce prices and improve quality.
Low prices for all: the simplest way for a company to gain a high market share is to offer a
better price. In a competitive market, prices are pushed down. Not only is this good for
consumers - when more people can afford to buy products, it encourages businesses to produce
and boosts the economy in general.
Better quality: Competition also encourages businesses to improve the quality of goods and
services they sell to attract more customers and expand market share. Quality can mean various
things: products that last longer or work better, better after-sales or technical support or friendlier
and better service.
More choice: In a competitive market, businesses will try to make their products different from
the rest. This results in greater choice so consumers can select the product that offers the right
balance between price and quality.
Innovation: To deliver this choice, and produce better products, businesses need to be
innovative in their product concepts, design, production techniques, services etc.
Better competitors in global markets: Competition within the EU helps make European
companies stronger outside the EU too and able to hold their own against global competitors.

Profit maximization
In economics, profit maximization is the short run or long run process by which a firm
determines the price and output level that returns the greatest profit. There are several approaches
to this problem. The total revenuetotal cost perspective relies on the fact that profit equals
revenue minus cost and focuses on maximizing this difference, and the marginal revenue
marginal cost perspective is based on the fact that total profit reaches its maximum point where
marginal revenue equals marginal cost.

MARGINAL COST:
The change in total cost (or total variable cost) resulting from a change in the quantity of output
produced by a firm in the short run. Marginal cost (MC) indicates how much total cost changes
for a given change in the quantity of output. Because changes in total cost are matched by
changes in total variable cost in the short run (total fixed cost is fixed), marginal cost is the
change in either total cost or total variable cost. It is found by dividing the change in total cost
(or total variable cost) by the change in output. Marginal cost is one of four cost concepts used in
short-run production analysis. The other three are average total cost, average fixed cost, and
average variable cost.
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Marginal cost (MC), the change in total cost or total variable cost due to a change in output, is
the focal point in the analysis of short-run production cost and how this helps explain the law of
supply and the upward-sloping supply curve. While other cost-related terms, including total cost,
total variable cost, average total cost, and average variable cost, are noteworthy, marginal cost is
without question the most important.
The reason is that increasing marginal cost reflects the law of diminishing marginal returns. As
marginal returns decline, marginal cost increases. However, as marginal cost increases,
the price a firm needs to receive also increases. The result is a positive relation between price and
quantity supplied, which is the law of supply and the supply curve.
Marginal cost tends to be relatively high but declining for small quantities of production. It then
reaches a minimum and rises for larger quantities of output. When plotted in a graph, marginal
cost traces out a U-shaped pattern. The reason for this shape is directly related to increase and
decreasing marginal returns and especially the law of diminishing marginal returns.
The enormous importance of marginal cost to a firm's short-run production decision cannot be
overstated. A profit-maximizing firm compares the marginal revenue received from output sold
with the marginal cost of producing it. If marginal revenue equals marginal cost, then the firm
produces the profit-maximizing output quantity. If marginal revenue is less than marginal cost,
then it can boost profit by increasing production. If marginal revenue is greater than marginal
cost, then it can boost profit by decreasing production.

'Marginal Revenue - MR'

The increase in revenue that results from the sale of one additional unit of output.Marginal revenue is
calculated by dividing the change in total revenue by the change in output quantity. While marginal
revenue can remain constant over a certain level of output, it follows the law of diminishing returns
and will eventually slow down, as the output level increases.
Perfectly competitive firms continue producing output until marginal revenue equals marginal cost.
For example, a company producing brooms has a total revenue of $0, when it doesn't produce any
output. The revenue it sees from producing its first broom is $15, bringing marginal revenue to $15
($15 in total revenue/1 unit of product). If the revenue from the second broom is $10, the marginal
revenue gained by producing the second broom is $10 (change in total revenue: $25-$15/1 additional
unit).

Integrated Marketing Communications

Integrated marketing communications (IMC) is an approach used by organizations to brand and
coordinate their communication efforts. The American Association of Advertising Agencies defines
IMC as "a comprehensive plan that evaluates the strategic roles of a variety of communication
disciplines and combines these disciplines to provide clarity, consistency and maximum
communication impact. " The primary idea behind an IMC strategy is to create a seamless experience
for consumers across different aspects of the marketing mix. The brand's core image and messaging
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are reinforced as each marketing communication channel works together as parts of a unified whole
rather than in isolation.

THE MARKETING CONCEPT

What philosophy should guide a company marketing and selling efforts? What
relative weights should be given to the interests of the organization, the customers,
and society? These interest often clash, however, an organizations marketing and
selling activities should be carried out under a well-thought-out philosophy of
efficiency, effectiveness, and socially responsibility.
Five orientations (philosophical concepts to the marketplace have guided and
continue to guide organizational activities:
1.
2.
3.
4.
5.

The Production Concept

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

The Production Concept. This concept is the oldest of the concepts in business. It
holds that consumers will prefer products that are widely available and
inexpensive. Managers focusing on this concept concentrate on achieving high
production efficiency, low costs, and mass distribution. They assume that consumers
are primarily interested in product availability and low prices. This orientation makes
sense in developing countries, where consumers are more interested in obtaining the
product than in its features.
The Product Concept. This orientation holds that consumers will favor those products
that offer the most quality, performance, or innovative features. Managers focusing
on this concept concentrate on making superior products and improving them over
time. They assume that buyers admire well-made products and can appraise quality
and performance. However, these managers are sometimes caught up in a love affair
with their product and do not realize what the market needs. Management might
commit the better-mousetrap fallacy, believing that a better mousetrap will lead
people to beat a path to its door.
The Selling Concept. This is another common business orientation. It holds that
consumers and businesses, if left alone, will ordinarily not buy enough of the selling
companys products. The organization must, therefore, undertake an aggressive
selling and promotion effort. This concept assumes that consumers typically sho9w
buyi8ng inertia or resistance and must be coaxed into buying. It also assumes that the
company has a whole battery of effective selling and promotional tools to stimulate
more buying. Most firms practice the selling concept when they have
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overcapacity. Their aim is to sell what they make rather than make what the market
wants.
The Marketing Concept. This is a business philosophy that challenges the above three
business orientations. Its central tenets crystallized in the 1950s. It holds that the key
to achieving its organizational goals (goals of the selling company) consists of the
company being more effective than competitors in creating, delivering, and
communicating customer value to its selected target customers. The marketing
concept rests on four pillars: target market, customer needs, integrated marketing and
profitability.
Distinctions between the Sales Concept and the Marketing Concept:
1.
The Sales Concept focuses on the needs of the seller. The Marketing Concept
focuses on the needs of the buyer.
2.
The Sales Concept is preoccupied with the sellers need to convert his/her
product into cash. The Marketing Concept is preoccupied with the idea of satisfying
the needs of the customer by means of the product as a solution to the customers
problem (needs).
The Marketing Concept represents the major change in todays company orientation
that provides the foundation to achieve competitive advantage. This philosophy is the
foundation ofconsultative selling.
The Marketing Concept has evolved into a fifth and more refined company
orientation: The Societal Marketing Concept. This concept is more theoretical and
will undoubtedly influence future forms of marketing and selling approaches.
The Societal Marketing Concept. This concept holds that the organizations task is to
determine the needs, wants, and interests of target markets and to deliver the desired
satisfactions more effectively and efficiently than competitors (this is the original
Marketing Concept). Additionally, it holds that this all must be done in a way that
preserves or enhances the consumers and the societys well-being.
This orientation arose as some questioned whether the Marketing Concept is an
appropriate philosophy in an age of environmental deterioration, resource shortages,
explosive population growth, world hunger and poverty, and neglected social services.
Are companies that do an excellent job of satisfying consumer wants necessarily
acting in the best long-run interests of consumers and society?
The marketing concept possibily sidesteps the potential conflicts among consumer
wants, consumer interests, and long-run societal welfare. Just consider:
The fast-food hamburger industry offers tasty buty unhealthy food. The hamburgers
have a high fat content, and the restaurants promote fries and pies, two products high
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in starch and fat. The products are wrapped in convenient packaging, which leads to
much waste. In satisfying consumer wants, these restaurants may be hurting
consumer health and causing environmental problems.

Significance of marketing
Use of the term "marketing organization" is somewhat confusing. As commonly used in business this
term refers to the part of the total organisation structure of a company primarily responsible for the
marketing functions of the company. In this sense of the term, it does not make much sense to speak
of its concept and significance. We can say that significance of marketing organization is directly
related to the concept and importance for marketing function. Therefore, in my answer below, I have
discussed the concept and importance of marketing.
Marketing is the function within a company that deals with determining the nature of products and
services to be produced and sold by it, and planning and execution of product pricing, promotion and
distribution to deliver value to the customer and in turn meet profit and other goals of the company.
The marketing concept has evolve over a period as a means of achieving competitive advantage
replacing earlier business concepts such as production concept, product concept and selling concept.
The production concept concentrated on reducing the production cost and increasing production. The
product concept concentrated on offering better product and increased capability features that relied
on design innovation rather than focusing on customer needs. Selling concept concentrated on selling
more and more of the products that a company could produce. The approach of selling is to convince
customers to buy what is produced. Marketing concept is in a way reverse of this. It focuses on
producing what what the customers will want to buy.
In this way marketing benefits both customers and the company. It increases the customer benefits by
producing and selling what they need most. At the same time it benefits company by increasing its
sales and profits. It also improves continued customer patronage for the company and its products.

Market Segmentation & Targeting

Market segmentation is the process of dividing an entire market up into different customer
segments. Targeting or target marketing then entails deciding which potential customer segments
the company will focus on. Marketing segmentation always comes before targeting, which helps
a company be more selective about who they are marketing their products to. Marketing
segmentation and targeting are equally important for ensuring the overall success of a company.
Significance
Marketing segmentation and targeting are particular important for finding customers that are the
best match for a business's products and services. It is not feasible to go after all
customers, because customers have different wants, needs and tastes. Some customers want to be
style leaders. They will always buy certain styles and usually pay a high price for them. Other
customers are bargain shoppers. They try to find the lowest price. Obviously, a company would
have difficulty targeting both of these market segments simultaneously with one type of product.
For example, a company with premium products would not appeal to bargain shoppers.
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Identification
The process of marketing segmentation and targeting are necessary to identify and target certain
demographic groups. Customer demographics can include gender, age, income, household size,
geographic area and even various ethnic groups. One or more of these demographic segments
will be more likely to purchase a company's products or services, while other
demographic segments may be more suitable for competitive products or services.
Hypothetically, a certain new radio station may discover that their music appeals more to 34-to54-year-old women who earn over $50,000 per year. The station would then target these women
in their marketing efforts.
Type
Marketing segmentation and targeting can be used for both consumer and business customers.
Besides demographics, other ways to segment consumers is by different psychographic or
behavioralistic characteristics, such as their interest and usage rate, respectively, according to the
article "Market Segmentation" at Net MBA, a well-respected online business reference site.
Business customers are usually segmented by company type and size. For example, a small food
distributor may likely target small or mid-sized restaurants, hospitals and nursing homes.
Function
Marketing segmentation can be a lengthy process. It is important for the company to know
exactly which segments represent the most potential sales for its business. After a company
identifies all possible market segments, it can start targeting these customer segments with direct
mail, magazine, radio, television, and even Internet marketing. Targeting specific customers
entails creating the right advertising message with the right media. For example, an ad for an
expensive perfume would be well-suited for one or more premium style magazines that fill
grocery store magazine racks.
Considerations
Companies can perform marketing segmentation and targeting by first conducting some
marketing research. The company will need to include demographic types of questions, so it can
later determine which demographic groups comprise the majority of their customer base.
Companies that use marketing segmentation and targeting properly can usually expect great sales
and profits, according to Evan Carmichael's site, a top resource for small business
strategies.

Direct marketing
Direct marketing is about making direct contact with existing and potential customers to promote
your products or services. Unlike media advertising, it enables you to target particular people
with a personalized message.
Direct marketing can be cost effective and extremely powerful at generating sales, so it is ideal
for small businesses.
Direct marketing uses a variety of different methods. Direct mail, mailshots and leafleting are
widespread, and other forms of direct and integrated communication are growing in popularity.
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Telephone marketing, mobile and SMS marketing and email marketing are also well established
marketing methods and offer more opportunities to reach your target market.
Why use direct marketing?
Direct marketing allows you to generate a response from targeted customers. As a result, small
businesses can focus their limited marketing resources where they are most likely to get results.
A direct marketing campaign with a clear call to action can help you boost your sales to existing
customers, increase customer loyalty, recapture old customers and generate new business.
Direct marketing can be evaluated and measured precisely. For example, you can send out test
marketing emails directing customers to specific campaign pages of your website. You can
analyze results to see which email was most successful. You can also test your marketing with
sample groups before you roll out the campaign that will deliver the best response rate.
Whether you are targeting business (b2b) customers or consumers, direct marketing can deliver
results. Choosing the right communication method is vital. Businesses can be more receptive to
receiving sales calls than consumers, for example. Individuals will prefer different ways of
contact, so make sure you take account of their preferences

Advertising.
To call the public's attention to your business, usually for the purpose of selling products
or services, through the use of various forms of media, such as print or broadcast
notices .
Advertising provides a direct line of communication to your existing and prospective
customers about your product or service. The purpose of advertising is to:

Make customers aware of your product or service;

Convince customers that your company's product or service is right for their
needs;

Create a desire for your product or service;

Enhance the image of your company;

Announce new products or services;

Reinforce salespeople's messages;

Make customers take the next step (ask for more information, request a sample,
place an order, and so on); and
Draw customers to your business.
Your advertising goals should be established in your business plan. For example, you
may want to obtain a certain percentage of growth in sales, generate more inquiries for
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sales, or build in-store traffic. The desired result can simply be increasing name
recognition or modifying the image you're projecting. Objectives vary depending on the
industry and market you're in.
All products and businesses go through three stages, with different advertising goals for
each one.
1. The start-up business. You're new in the market and need to establish
your identity. Your company needs high levels of promotion and publicity
to grab consumers' attention.
2. The growing business. Once your identity is established, you need to
differentiate yourself from your competition and convince buyers that
yours is the service or product to try.
3. The established business. The purpose at this point is to remind
consumers why they should continue buying from you.

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