Marketing Essentials

The Marketing Concept

Prof. Aparna Kanchan 1

Session Objectives

The Marketing Concept

Relevance of the Marketing Concept in India

The Marketing Mix

Marketing Structures & Systems

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What is Marketing…??
Selling?

Advertising?

Promotions?

Making products available in stores?

Maintaining inventories?

All of the above, plus much more!

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What is Marketing…??

Marketing is the process of planning and

executing the conception, pricing, promotion, and
distribution of ideas, goods, services to create
exchanges that satisfy individual and
organizational goals

--- American Marketing Association

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What is Marketing…??

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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 Simple Marketing System
Communication

Goods/services
Industry Market
(a collection (a collection
of sellers) of Buyers)
Money

Information
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What is Marketing…??
 Marketing is the sum of all activities that take you to a
sales outlet. After that sales takes over.
 Marketing is all about creating a pull, sales is all about
push.
 Marketing is all about managing the four P’s –
product
Product Price
price
place
promotion
Place Promotion

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Difference Between - Sales & Marketing ?

Sales
trying to get the customer to want what the
company produces

Marketing
trying to get the company to produce what the
customer wants

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Marketing Orientation & How it can be employed by Organizations
A Six dimensional Approach
I. Consumer Orientation-
 Unsuccessful fulfilled needs drive the new product development
at successful companies

II. Integrated approach to exploiting marketing opportunities

 All elements of the mktg.mix to be integrated into a sound
business plan

III. Futuristic Approach

 Mktg. spend looked upon as investment

I. Highly developed Marketing Systems

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 Market feedback as source of product improvement
Marketing Orientation & How it can ne employed by
Organizations
A Six dimensional Approach
V. Marketing Culture
 Customer ‘s interests override organization Interests

VI. Speed
 The rate at which customer queries & problems are
answered

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Marketing Orientation Vis- a vis Selling Orientation
 Selling Approach is more
transaction oriented & aims at
maximization in the short
term
 Undermines research & is
more intuitive
 Works well in less complex
markets where competition is
low
 Works on Mass Mktg
 Eg: PAL, Hindustan Motors
 The Marketing Approach
emphasizes customer
management, customized
approach to winning &
retaining a customer- profits
over long term
 Based on the premise that
each customer is different &
hence needs will be different
 Customer is the focal point
 Eg: Suzuki
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Relationship Marketing
 Decade of the 90’ saw the rebirth of Relationship Marketing

 Trust has an asymmetrical quality – is built slowly over several

transaction but disappears in a flash

 RM emphasizes on both the “ soft” & the “hard” aspect of Mktg.

 Hard aspect – Product Reliability, use of interactive

technologies etc..

 Soft Aspect - Human interactions, dependability issues

among salespersons, service personnel etc…

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 Relationship Marketing
According to Jonathan R. Capulsky & Michael J. Wolf:

 Relationship Marketing process incorporates the following three main

elements

 Identifying & building database of current & prospective

buyers/consumers, including complete details on demographics & psycho-
graphics of the Target group of consumers & also their purchasing
behaviour

 Based on the above, evolve a differentiated marketing communication

strategy in terms of message content & channel selection

 Monitoring each relationship to ensure continued growth in customers

purchases
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Focus on Internal Customer
Internal Customer focus is as important as external
customer focus
Customer satisfaction cannot be achieved until & unless all
the personnel within the organization understand the
importance of the external customer & are connected to
them
It involves each department and individual understanding
the needs , expectations & problems of next-in – queue
department or individual

Eg: Marketing Department Production Department

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Basic Requirements of an Internal Customer

Colleagues who are friendly & willing to help

Courtesy & Respect
Efficient, Friendly & knowledgeable concepts
Pleasant Approach
Fulfillment of Expectations

The 3 C’s of Internal Customer Care 16

Market Driven Organizations

Primarily customer-centric
Products are designed to meet the current & the future
needs of the customer
Potential to become market leaders
Products perceived to be superior to those of
competitors & hence offer more value for money
Better track record on product launches & innovation
Eg: HUL

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Marketing as a Process

Process involves an exchange transaction between the

buyer & the seller
Difference between Barter & Marketing?
A transaction could be termed as a ‘Marketing
Transaction’ only if it could result in mutual satisfaction to
both the buyer & the seller
Underlying assumption is the development of a long-
term relationship

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Marketing as a Process

 Marketing – is an exchange
process- Both buyer & seller
must have something to give
each other
 Both the buyer & seller must
gain
 It should result in long term
satisfying relationship between
both

a. Involves understanding the customers interest s

b. Serving them in such a way that it helps the selling
organization to fulfill its objective- profit maximization
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 Core
Core Marketing
Marketing Concepts
Concepts

Products
Needs, wants, and
and demands Services

Core
Core
Marketing
Marketing
Concepts
Concepts
Markets
Value, satisfaction,
and quality

Exchange, transactions,
and relationships

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Target Markets & Segmentation

Market segments can be identified by examining

demographics, psychographics & behavioral differences
among buyers
The segments which offers the greatest opportunity –
target market
For each target market, the firm develops a market
offering
The offering is positioned in the minds of the target buyer
as delivering some central benefit

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Marketplace, Marketspace & Metamarket

 The term Market is used to cover various groupings of customers

 Need market ( the diet-seeking market)
 Product markets ( the show market)
 Demographics market ( the youth market)
 Geographic market ( the North Indian market)

 Market place is physical

 Market Space is digital
 MetaMarket is a cluster of Complimentary products & services that
are closely related in the minds of the consumers
 Eg: Automobile Market, Real eastate

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Marketers & Prospects

Marketer is someone seeking a

response ( attention, a purchase , a
vote, a donation) from another party
called a Prospect

If 2 parties are seeking to sell

something to each other, we call them
both marketers

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Needs, Wants & Demands

Needs – basic human requirements. People need food,

air, water, clothing & shelter to survive. People also
have strong needs for recreation, education &
entertainment

Wants –Needs become wants when they are directed

to specific objects that might satisfy the need. Wants
are shaped by one’s society

Demands – are wants for specific products backed by

the ability to buy
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Product ,Offering, & Brand

Companies address needs by putting forth value

proposition- a set of benefits they offer to customer to
satisfy their needs

The intangible value proposition is made physical by an

offering, which can be a combination of products,
services, information & experiences

A brand is an offering from a known source eg:

McDonald’s

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Customer value concerns the difference between the
benefits a customer sees from a firm’s market offering and
the costs of obtaining those benefits

Costs Benefits

The customer’s view of costs and benefits is not just

limited to economic (or even rational) considerations--
and a low price may NOT result in superior value...
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 Costs Benefits

 One customer’s view of the benefits and costs of a firm’s market

offering may vary from another customer’s view, so firm may not be
able to satisfy everybody with the same offering.

 Customer value concept takes the customers point of view, but

customers may not explicitly weigh costs and benefits and even if
they do their view may not match some “objective” reality.
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 To reach the TG market, the marketer uses three kinds of
Mktg. channels

 Communication Channels deliver & receive messages

from target buyers, & include newspapers magazines,
radio, T.V, mail, telephones , posters hoardings etc…

Distribution Channels is used to display, sell, or deliver

the physical products or service to the buyer or user.
These include distributors, wholesalers, retailers &
agents

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Marketing Channels

Service Channels carry out transactions with potential

buyers.

Service Channels include warehouses, transportation

companies, banks & insurance companies that facilitate
transactions

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Supply Chain

The supply chain represents a value delivery system

While the Marketing channels connect the marketer

to the target buyer, the supply chain describes a
longer channel stretching from raw material to
components to final product that are carried to final
buyers

Eg: Women’s purse

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Competition

Competition includes all the actual & potential

rival offerings & substitutes that a buyer might
consider.

1. Brand Competition
2. Industry Competition
3. Form Competition
4. Generic Competition

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Marketing Program

The Marketers task is to build a marketing

program or plan to achieve the company’s
desired objectives
The Marketing program consists of numerous
decisions on the mix of the marketing tools to
use.
The Marketing mix is a set of tools the firm uses
to pursue its marketing objectives in the target
market

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The Marketing Mix

The tools available to a business to gain the

reaction it is seeking from its target market in
relation to its marketing objectives

7Ps – Price, Product, Promotion, Place, People,

Process, Physical Environment

Traditional 4Ps extended to encompass growth

of service industry
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The Marketing Mix

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Price

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Price
Pricing Strategy
Importance of:
knowing the market
elasticity
keeping an eye
on rivals

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Product

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Product
 Methods used to
improve/differentiate
the product and increase sales
or target sales more effectively
to gain
a competitive advantage e.g.
 Extension strategies
 Specialised versions
 New editions
 Improvements – real or
otherwise!
 Changed packaging
 Technology, etc.

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Promotion

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Promotion
Strategies
to make the
consumer aware of
the existence of a
product
or service
NOT just advertising

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Place

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Place
The means by which products and services get from
producer to consumer and where they can be accessed
by the consumer

The more places to buy the product and the easier it is

made to buy it, the better for the business (and the
consumer?)

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People

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People
People represent the business
The image they present can be important
First contact often human – what is the lasting image
they provide to the customer?
Extent of training and knowledge
of the product/service concerned
Mission statement – how relevant?
Do staff represent the desired culture
of the business?

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Process

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Process
How do people consume services?
What processes do they have to go through to
acquire the services?
Where do they find the availability
of the service?
Contact
Reminders
Registration
Subscription
Form filling
Degree of technology

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Physical Environment

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Physical Environment
The ambience, mood or physical presentation of
the environment
Smart/shabby?
Trendy/retro/modern/old fashioned?
Light/dark/bright/subdued?
Romantic/chic/loud?
Clean/dirty/unkempt/neat?
Music?
Smell?

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The Marketing Mix
Blend of the mix depends upon:
Marketing objectives
Type of product
Target market
Market structure
Rivals’ behaviour
Global issues – culture/religion, etc.
Marketing position
Product portfolio
 Product lifecycle
 Boston Matrix

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 • Consumers favor products that are
Production
Production Concept
Concept available and highly affordable
•Improve production and distribution

•Consumers favor products that offer

Product
Product Concept
Concept the most quality, performance, and
innovative features

•Consumers will buy products only if

Selling
Selling Concept
Concept the company promotes/ sells these
product

•Focuses on needs/ wants of target

Marketing
Marketing Concept
Concept markets & delivering satisfaction
better than competitors

•Focuses on needs/ wants of target

Societal
SocietalMarketing
MarketingConcept
Concept markets & delivering superior value
•Society’s well-being

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 Marketing
Marketing &
& Sales
Sales Concepts
Concepts Contrasted
Contrasted
Starting Focus Means Ends
Point

Selling Profits
Existing
Factory and through
Products
Promoting Volume

The
TheSelling
SellingConcept
Concept

Profits
Customer Integrated
Market through
Needs Marketing
Satisfaction

The
TheMarketing
MarketingConcept
Concept

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 Societal
Societal Marketing
Marketing Concept
Concept
Society
Society
(Human
(Human Welfare
Welfare))

Societal
Societal
Marketing
Marketing
Concept
Concept

Consumers
Consumers Company
Company
(Wants)
(Wants) (Profits)
(Profits)
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 Top
Management

Middle Management

Front-line people

Customers

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 Customers

Front-line people

Middle management

s
C

er
us

om
t

Top
om

t
us
manage-
er

C
s

ment

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Production Finance

Marketing Human
resources

a. Marketing as an
equal function
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 Production on
cti

Fi
du

na
ro

nc
P

e
Marketing Customer
re
Hu ur

ce M
so

ur an
n ar

s
ma ces

ce
ke

so m
n
Fi tin

re Hu
n

c. Marketing as the d. The customer as the

major function controlling factor
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 Production

Marketing

Customer
re
Hu ur
so

e
ma ces

n c
a
n

in
F

e. The customer as the controlling

function and marketing as the
integrative function 61
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Marketing in the Present Millennium- Challenges & Issues

 Seamless Global Society

 Internet - Redefining Concept of time & Value

 Basis for Competitive Advantage

 Knowledge Management & Information
Technology

 Business at the Speed of thought

 Shorter product Life cycles

 Emergence of Virtual Enterprise

 Eg: Yahoo.com, Amazon.com, Rediff.com etc..
 Size & location- very little say
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Marketing in the Present Millennium- Challenges & Issues
 Customer : Co-producer of Products & Services
 Manufacturer takes the product up to a certain level in the value chain
post which the buyer customizes it to his/her requirement
 Eg: Asian paints, McDonalds – self service system

 Customer : A Warehouse of Information

 Challenge for the Marketer on how to use the information for
developing its marketing mix
 Era of standardization replaced by mass customization

 The role of distribution channels

 The conventional dealer & distributor will no longer be viable.
 The role will no more be of physical delivery, sharing risks &
investment in stock movement….. It will be service and customization
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Marketing in the Present Millennium- Challenges & Issues
 The poor as a market segment
 Globalization has widened the gap between the rich & the poor
 Since this constitutes a large segments, firms will have to come out
with a creative solutions to meet the needs of this market

 Environment Protection
 Marketers to make a conscious effort to protect and maintain the
environment
 Need for eco- friendly measures – product development, use or
disposal

 Diversity & Convergence Coexist

 While markets are diverse, convergence of needs is also a fact

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THANK- YOU

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