INDIAN INSTITUTE OF TECHNOLOGY ROORKEE

Defining Marketing in 21st Century

Presented by:
Amit Kumar Agrawal
Senior Research Fellow,
Department of Management Studies,
Indian Institute of Technology Roorkee,
Uttarakhand-247667
2 Feb 2015

Questions

Why is marketing important?

What is the scope of marketing?
What are some fundamental marketing concepts?
How has marketing management changed?
What are the tasks necessary for successful marketing
management?

Marketing?

ADVERTISIN
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PRESSUR
E

PERCEPTI
ON
SELLIN
G

DECEPTIV
E
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The Importance of Marketing

Formally or informally, people and organizations engage in a

vast number of activities we could call marketing. Good
marketing has become increasingly vital for success. But
what constitutes good marketing is constantly evolving and
changing.
The election of Narendra Modi as the 15th Prime Minister of
India was attributed, in part, to the adoption of new
marketing practice

The Importance of Marketing

Availability of clean and safe drinking water, especially to the
poorer sections of society, is a challenge many South Asian
countries have been grappling with.
Many companies in India are showing the way to meet this
challenge by designing technologically advanced household water
purifiers that are appropriate for consumers usage conditions, and
yet available at affordable price ranges.
Tata chemicals, for example, has launched an innovative water
purifier called Tata Swach, which requires neither electricity nor
running water to function. The purifier, made from natural
materials such as rice husk ash filled with nano-silver particles, is
marketed at a price of about Rs. 1,000.

Good Marketing is No Accident

It is a result of careful planning
and execution using state-of
art tools and techniques.
It becomes both an art and
science as marketers strive to
find creative new solutions to
often-complex challenges amid
profound changes in the 21st
century

Good Marketing is No Accident

The roaring success
of four-wheeler Tata
Ace, in a market
earlier dominated by
three-wheeler load
carriers, was due to a
deep understanding
of the market needs
and customer
requirements.
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The Importance of Marketing

The first decade of the 21st century challenged firms to prosper
financially and even survive in the face of an unforgiving
economic environment.
Marketing is playing a key role in addressing those challenges.
Finance, operations, accounting, and other business functions
wont really matter without sufficient demand for products and
services so the firm can make a profit.

In other words, there must be a top line for there to be a bottom

line. Thus financial success often depends on marketing ability.
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The Importance of Marketing

Marketings broader importance extends to society as a whole.

Marketing has helped introduce and gain acceptance of new
products that have eased or enriched peoples lives.
It can inspire enhancements in existing products as marketers
innovate to improve their position in the marketplace.
Successful marketing builds demand for products and services,
which, in turn, creates jobs.
By contributing to the bottom line, successful marketing also
allows firms to more fully engage in socially responsible activities.

The Importance of Marketing

Marketers must decide what features to design into a new product

or service, what prices to set, where to sell products or offer
services, and how much to spend on advertising, sales, the Internet,
or mobile marketing.

They must make those decisions in an Internet-fueled environment

where consumers, competition, technology, and economic forces
change rapidly, and the consequences of the marketers words and
actions can quickly multiply.

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The Importance of Marketing

One of the defining changes resulting from the increasing

popularity of the Internet is the explosive growth of the social
networking media.
This powerful medium is rapidly changing the ways in which
companies connect with customers and how they market their
products and services

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The Scope of Marketing

What is Marketing
Who does it
What is Marketed

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What is Marketing?
Marketing is an organizational function and a set of processes
for creating, communicating, and delivering value to customers
and for managing customer relationships in ways that benefit
the organization and its stakeholders.
Marketing is the activity, set of institutions, and processes
for creating, communicating, delivering, and exchanging
offerings that have value for customers, clients, partners, and
society at large.

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Social Definition of Marketing

Marketing is a societal process by which individuals and
groups obtain what they need and want through creating,
offering, and freely exchanging products and services of
value with others

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Marketing and Exchange

The customer seeks

Marketing
isthe
an
benefits from
company,
and expects to pay.

Customer
Customer

exchange between a
Company
Company

The company offers

firm and
benefits
customer
to its
customers,
and seeks profits.

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For an exchange to occur..

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

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What is Marketing Management?

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.
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Selling is only the tip of the iceberg

There will always be a need for

some selling. But the aim of marketing is to
make selling superfluous. The aim of marketing
is to know and understand the customer so well
that the product or service fits him and sells
itself. Ideally, marketing should result in a
customer who is ready to buy. All that should
be needed is to make the product or service
available.
Peter Drucker

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What Can We Market?

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What Can We Market?

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Demand States

Negative

Nonexistent

Declining

Full

Latent

Irregular

Overfull

Unwholesome

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A Simple Marketing System

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Structure of Flows in a Modern Exchange

Economy

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Key Customer Markets

Consumer Markets

Business Markets

Global Markets

Nonprofit/ Government Markets

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Core Marketing Concepts

Needs, wants, and

demands
Segmentation,
Targeting, and
Positioning
Offerings and brands

Value and
satisfaction
Marketing channels
Supply chain
Competition
Marketing
environment

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5 Types of Needs

Stated needs (The customer wants an inexpensive car)

Real needs (The customer wants a car whose operating
cost, not its initial price, is low)
Unstated needs (The customer expects good service from
the dealer)
Delight needs (The customer expects the dealer to include
a GPS)
Secret needs (The customer wants friends to see him as a
savvy consumer)

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Maslows Hierarchy of Needs

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Discussion Question

Can you think of a single product that satisfies everyones

needs/preferences?
Consider the following:
A 12 ounce can of Pepsi
Magic Kingdom at Disney World
A Ritz Carlton Hotel

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What is Segmentation?

Segmentation
Breaking the heterogeneous market into smaller, homogeneous
markets
Segment
A group of customers who share similar inclinations toward a
brand

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Groups of Customers

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How to Choose a Target

When choosing target market(s),

marketers should consider
1. The markets fit with the firms capabilities
More subjective/challenging to assess
2. The profitability potential of the market
More objective

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Strategic Criteria for Targeting

Go for it:
Sports apparel producer
in the attractive volley ball
apparel market

Hmm:
CD producer in the attractive
video game market

Hmm:
Typewriter producer in the
unattractive typewriter
market

Avoid:
PC producer in the
unattractive e-book market

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Fit with Firms Capabilities

Does this market fit with what we are?
Questions
Can we satisfy this market?
What are our strengths?
What resources do we have?
What is our experience?
What is our corporate culture?
What are our current brand personalities, etc.?

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Positioning

Press ads of the Scorpio

focused on the functional
features of the vehicle
and the television ads
focused on emotional
benefits.

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Offerings and Brands

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Offerings and Brands

Company address customer needs by Value Proposition, a set of

benefits that satisfy those needs
The intangible value proposition is made physical by an offering,
which can be a combination of products, services, information, and
experience
A Brand is an offering from a known source

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Value and Satisfaction

Quality
Service
Price

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Determinants of Customer Delivered

Value
Image
Image Benefits
Benefits
Personnel
Personnel benefits
benefits
Services
Services benefits
benefits

Total
Total
customer
customer
benefits
benefits

Product
Product benefits
benefits

Customer
Customer
value
value

Monetary
Monetary cost
cost
Time
Time cost
cost
Energy
Energy cost
cost

Total
Total
customer
customer
cost
cost

Psychic
Psychic cost
cost
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Satisfaction
is a persons feelings of pleasure or
disappointment resulting from comparing
a products perceived performance (or
outcome) in relation to his or her
expectations.

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Marketing Channels

Communication Channels: deliver and receive messages from

target buyers
Distribution Channel: display, sell, deliver
Service Channels: carry out transactions

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Supply Chain

Longer channel
Stretching from raw materials to components to finished products
carried to final buyers

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Competition

All actual and potential

rival offerings and
substitutes a buyer might
consider

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Marketing Environment

Demographi
c

Economic

Sociocultural

Politicallegal

Technologic
al

Natural

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New Consumer Capabilities

Informed
Empowered
Networked
Connected

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Company Orientations

Production

Product

Selling

Marketing

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Holistic Marketing Dimensions

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Integrated Marketing
The Four Ps

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Marketing Mix and the Customer

Four Ps
Product
Price
Place
Promotion

Four Cs
Customer
solution
Customer cost
Convenience
Communication

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Customers view of four Ps

Solution: How can I solve my problem?

Information: Where can I learn more about it?
Value: What is the total sacrifice to get this solution?
Access: Where can I find it?

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The Marketing Process

g
t in
ke ol
ar t r
M Con

PoliticalLegal
Environment

Target
Consumers
Promotion

Competitors

Price

Publics

M
Im a r
pl ket
em i n
en g
ta
tio

M
An a r k
a l et i
y s ng
is

Place

Product

g
tin g
ke in
ar n
M la n
P

Suppliers

TechnologicalNatural
Environment

Marketing
Intermediaries

DemographicEconomic
Environment

SocialCultural
Environment

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Marketing Framework

Start with a Situational Analysis using the 5Cs

Context is the climate or the external environment:
PEST Analysis
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Marketing process

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Thank
You

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