Introduction to

Marketing & Key

Concepts
Session 1

1
Market?
A Situation where Buyers and Sellers of a
commodity interact.
Need/Want Satisfaction
Demand No. of Buyers/Sellers
Supply Product/Services
Price Regulations
Quality
 Effective Definition of Market?
Served Market!
Depending on:
Customer
Segments Our Customers?

Bank Served
Their needs?
Market
Our Products to meet?
Efficiency, Profitability
Geographic Product/
Coverage service Range and Risk involved?
Resources needed?
Figure: Served Market Definition
How to manage so?
 Marketing?
A Planning Process
About Selling a Good, Service or Idea
Works through Exchange Process
Individual or Organizational Objectives
Pricing, Promotion & Distribution of Something
Customer Satisfaction, Profit, Total Company
Effort, and Social Responsibility
Marketing
Marketing is a total system of
business activities designed to
plan, price, promote and distribute
want-satisfying goods and
services to present and potential
customers.
Selling vs. Marketing
A. MARKETING CONCEPT
Starting Point Focus Means Ends

Target Customer Integrated Profit by

Market Needs Marketing Customer
Satisfaction

A. SELLING CONCEPT
Starting Point Focus Means Ends

Factory Products Selling & Profit by

Promoting Sales
Revenue
 Goal of Marketing?
To Get Customers
Purchase,

Use, and
Re-purchase (both repeat & cross
selling) Your products!
 Services?
Services are deeds, processes and performances.
Any activity or benefit that one party can offer to
another that is essentially intangible and does not
result in ownership of anything.

Services are a form of products.

Can you make a list of the noticeable differences?
 Industries Classified Within
The Service Sector
Finance, Insurance & Real Estate Other Services
Banks Hotels
Non-bank Financial Institutions Personal services
Insurance Companies Business services
Real Estate Companies Auto repair & parking services
Leasing & Investment Companies Amusement & recreation
Transportation & Public Utilities services
Transportation
Health services
Rail Legal services
Water Educational services
Air Social services
Other Transportation services
Communication
Government
T&T City Corporations
Radio & TV broadcasting Security Services
Electric, Gas & Sanitary Services
 Services: Distinctive Features?
1.Intangibility
Services can not be seen, tasted or touched

Marketing Implication
Services can not be inventoried
Services can not be patented

Services can not be readily displayed/communicated

Decisions on what to include in promotional material

are challenging
Unit cost of service is hard to determine, Pricing is
difficult
 Services: Distinctive Features?
2. Inseparability
Services cant be separated from its providers

Marketing Implication
Services are sold first, then produced & consumed
simultaneously
Customers participate in and affect the transaction
Customers affect each other
Employees affect the service outcome
Decentralization may be essential
Mass production is difficult
 Services: Distinctive Features?
3. Heterogeneity
Difficult to standardize, harder to control

Design, Production, Delivery and Quality

Marketing Implication
Service delivery and customer satisfaction depend
on employee actions
Service quality depends on many uncontrollable

factors
No certainty that service delivered matches what

was planned and promoted

 Services: Distinctive Features?
4. Perishability
Services cant be inventoried for later sale

Marketing Implication
Difficult to synchronize supply and demand with
services
Services can not be returned or resold
Why Service Marketing?

Marketing & Managing Service is different

than that of Products

Tremendous growth of service industries,

a service-based economy
 Reasons for Growth in Service Businesses
Increased Greater demand for lawn care, carpet cleaning and other
Affluence services that consumers formerly provided for themselves

Increased Greater demand for travel agencies, travel resorts, adult

Changing Life Leisure Time education courses
Styles

Women in Greater demand for day care nurseries, maid service,

Workforce away from home meals

Increased Greater demand for income tax prepares, marriage

Complexity of Life counsellors, legal advisers, employment services

Increased
Greater demand for nursing homes and health care services
Life Expectancy
Changing World

Ecology & Greater demand for leased services, such as door-to-door

Resources bus service, and car rental instead of car ownership
Concerns

Range of The computer-sparked development of such service

New Products industries as programming, repair and time sharing
Changing Technology
Complexity of Greater demand for skilled specialists to provide
Products maintenance for complex products such as cars and home
computers

Source: Adapted from Schoel, W.F. and J.J. Ivey (1981) : Marketing: Contemporary Concepts
and Practices, Allyn and Bacon: Boston, Mass.. 277
 Challenges to Service Marketers
How to define & improve service quality? (intangible & non-
standardized)
How to design & test new service effectively? (intangible process)
How to motivate & select service employees? (critical part of
service)
How to set price? (cost is difficult to determine & price is
intertwined with perceptions of quality)
How to balance between standardization & personalization to
ensure efficiency of firm & satisfaction of customers?
How to protect new services concepts from competitors? (service
processes can not be legally patented)
How to communicate quality & value to customers? (offering is
intangible & can not be readily tried or displayed)
How to ensure delivery of consistent quality service? (both
employees & customers can affect the service outcome)
 Addressing Challenges:

1. Marketing Mix
Traditional Marketing Mix: 4 Ps
Marketing Mix

Product Price Place Promotion

Physical Features Flexibility Channel Type Promotion
Quality Level Price Level Exposure Blend
Accessories Terms Intermediaries Sales People
Packaging Differentiation Transportation Advertising
Warranties Discounts Storage Publicity
Branding Allowances Managing
Channels
Marketing mix: Expanded for Service
Marketing Mix

Product Place Promotion Price

Physical Channel Type Promotion Blend Flexibility
Features Exposure Sales People Price Level
Quality Level Intermediaries Number Terms
Accessories Transportation Advertising Differentiation
Warranties Storage Sales Discounts
Branding Managing Promotion Allowances
Channels Publicity

People Physical Evidence Process

Employees Facility Design Flow of Activities
Recruiting Equipment Standardized
Training Employee Dress Customized
Customers Signage Number of Steps
Education Simple
Training Customer Involvement
Addressing Challenges:
2. Service Marketing Triangle
Company

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Interactive Marketing
(Keeping Promises)
 Service Marketing Triangle
1. External Marketing:
Making Promises by Company to Customers
Traditional Elements:
Advertising, Sales promotions
Expansion:
Communicate the Promise to Customers:
Training of Service Employees
Design & decor of facility offered
Service Process
 Service Marketing Triangle
2. Internal Marketing:
Enabling promises.
A company effort to providers ensuring proper:
Skills,
Abilities,
Tools, and
Motivation to deliver
Satisfaction of Employee & Customer is inextricably linked!
Service Profit Chain
 Service Marketing Triangle
3. Interactive Marketing:
Keeping Promises by Providers (employees
or third-party) to Customers
Occurs when:
Customers interacts with company and the
Service is produced & consumed
Crucial from Customers point of view!
Service Marketing Pyramid:
Incorporating Technology
Company

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Interactive Marketing
(Keeping Promises)
 Bank Marketing
Bank marketing is a part of management activity
which seems to direct the flow of banking
services profitably to selected customers.
Why Bank Marketing?
Intense competition for customers among banks
Competitions coming from the new players in the
market like insurance, leasing or merchant companies
Increased sophistication of customers
Increased technology
Increased cost of meeting customer needs profitably
Bank-services Features & Marketing Implication
Intangibility
Bank Marketers can not illustrate, demonstrate or display the
service in use
Storage, transportation and inventory control are not relevant
for the bank marketer
This reasons for the absence of middlemen, necessitates the
use of direct channels of distribution
Inseparability
Main concern of Bank Marketers are just creating time &
place utility
Direct sale is almost the only feasible channel of distribution
(credit card!)
Bank-services Features & Marketing Implication
Highly individualized marketing system
Close personal & professional client relationship
exists
Lack of special identity
As products of different bank are identical, thus
excellent packaging (branch location, staff, services,
reputation, ad, new product development) is crucial
Widerange of products
Geographical dispersion (automation!)
Growth must be balanced with risk