WHY MARKETING IS MORE CHALLENGING TODAY?

Global Marketing / Products Previously only for Domestic companies Today doors are open to Global Players Global Niche specialists have arrived Technology shortened time and distance New Products landed speedily Communication / Media is growing New distance channels Competition is high

Change in Consumer Behaviour

Shopping with catalogues, telephone, computers Search Internet for best products / vendors / values. Place orders on Internet (Rich information environment) of competing brands. Customized products Technology create opportunities and threats as well. Eg. Agents closed. Customer Value Migration Continuously shift to supplies of greater value.

New Developments / Revolution in Marketing

More companies want to be Leaders in specific markets (no second place) Retaining customers than only Acquiring Expanding OFFER MIX to capture Customer Share and not just Market Share Identifying profitable customers and give all service
Customer Life Time Value immediate profit maximization. rather than

Marketing Vision
Marketing Vision and knowhow is needed to undertake necessary changes to succeed. Old views about marketing : Analyse marketing, find out opportunities, formulate strategies, Budgeting and control. Today s Marketing : 1. Push the rest of company towards Customer oriented, market driven. 2. Deliver superior customer value. Marketing : is process to identify market opportunities to profit needs, segment the market and select those where in company can satisfy in superior way, formulate strategy and redefine marketing mix.

1. Marketing is Def: Marketingand executing the a process of planning conception, pricing, promotion, and distribution of ideas, goods, services to create exchanges that satisfy individual and organizational goals. 2. Marketing is the art of selling products. 3. Marketing is identification and satisfaction of the customer needs. 4. Marketing is creating, offering and freely exchanging products and services of value. Peta F Drucker : The aim of marketing is know and understand the customer so well that products or service fits him and sells itself. Marketing should result in a customer who is ready. 5. Marketing social and Managerial process.

MARKETING TASKS
I. 3 Steps of Marketing a. Entrepreneurial Marketing: Primitive and initial stage with least personnel. b. Formulated Mktg: After growth and certain success, company adopts tools used in professionally run Marketing companies. c. Intra-preneurial Mktg : Marketers will be creative and passionate. They live with customers and add new values to customer s Lives. This is more effective but difficult to practice.

Scope of Marketing: What do we SELL?

Marketing personnel are involved with 10 types of entities. 1. Goods : Physical goods major portion of activities. 2. Services : Not physical but satisfy needs. As economy advances services sectors increases (US 70:30) 3. Experiences: By mixing many goods and services we can create experiences. 4. Events : Time based events.

Scope of Marketing
5. Persons : celebrity marketing which promotes person/ film stars / other professionals. Each person can become a brand by himself. 6. Places : to attract tourists, investments 7. Properties: Real Estate. 8. Organizations : to build favourable image corporate Identify. Universities, Museums, Associations. 9. Information : Books, Encyclopedia, Magazines, CDs, Internet. 10. Ideas : Concepts, messages (Knowledge) eg. Fair&Lovely Every Market Offering has an Idea.

Demand Management
Marketers are responsible for Demand management and they act based on the level, timing and composition of demand. 1. Negative Demand : Market dislikes product and tries to avoid. Marketers task is to analyse product, come out with a new plan like redesign, lower price, positive promotion. (Ambassador Cards, Non performing employee)

Demand Management
2. No Demand Consumers are unaware or Uninterested. 3. Latent Demand Consumers may have strong need that cannot be satisfied by any existing product. Task : How to 4. Declining Demand restimulate by new target markets, change features and stimulate through CREATIVE REMARKETING. 5. Irregular Demand : Seasonal, daily, hourly, resulting idle or overworked capacity.

Demand Management
6. Full Demand : full volume of business. Task: is to maintain current level inspite of changing preference, increase in competition. 7. Overfull Demand : Higher than they can handle. Task: Demarketing: reduce demand temporarily or permanently. 8. Unwholesome Demand : increasing the prices, less promotion, service. TASK: products attract organized efforts to discourage their consumption.

Different Market Places

1. Consumer Market : eg: toothpaste, TV, Develop superior product, promoting, try to establish a brand image. 2. Business Markets : Make or resell to others. Business buyers purchase products to make profits. Business marketers demonstrate how their products will help business customers achieve the profit goals.

Different Market Places

3. Global Markets How to enter other country? By exporter, License, JV, Contract manufacturer. How to adopt to other countries needs and environment, communicate, cultural practices, legal system, currency, political and corruption recognition. 4. Non profit or Govt market :pricing / bids or tenders

Core Marketing Concepts

Marketer Cannot Satisfy everyone. 1. Target Markets & Segmentation Marketing segments can be identified by Demographic, Psychographic, and behavioral differences of among buyers. 2. Positioning an offer to specific Market based on the greater opportunities available in a particular segment. * For each chosen market, firm develops market offering to suit to their specific needs. Eg: Tata Nano (less income)

Market:
1. A physical place where buyers and sellers meet to exchange goods. 2. As a collection of buyers and sellers who transact over a product or product class. Sellers constitute --- Industry Buyer constitute --- Market Communication Industry Seller Good / Services Money Information (Feedback)1 Market buyers

Market:
Need Market : Specific need Product Market : Car, TV Demographic Mkt : Youth, Women . Geographic Mkt : Karnataka, Indian Resource Mkt : raw materials, Labour, Money Market Place : Physical Shopping place Market space: through Internet Meta Market : complementary products eg: Marriage Mkt, Kalayan Mantapam, Saree, Jwellery, catering

Marketers and Prospects

Marketers are those who seek Response (purchase, attention) . Prospect is a potential buyer. Needs : are basic human requirement Wants: When they are directed towards specific objects that satisfy need. Demand : Backed by ability to pay CRITICS say : 1.Marketers create need 2.Marketers get people to buy that they do not want.

Product or Offering : Product is any offering that can satisfy a need or want. Eg: goods, events, places etc. Value and Satisfaction: Buyer chooses a product as he perceives that it has a higher value.
Value = Benefits = Functional Benefit + Emotional Benefit Cost Monetary cost + Time Cost + Energy Costs + Physical Cost

How to increase Value?

1. 2. 3. 4. 5. Raise Benefits Reduce Cost Raise benefits and Reduce Cost Raise benefits by more than raise in costs Lower benefits by less than reduction in costs. Def: Marketing is Identification, creation, communication, delivery, and monitering of customer value.

Exchange & Transaction

HOW TO OBTAIN A PRODUCT?: a. Self Produce b. Use force to get a product c. Begging d. Exchange : Obtaining a desired product by offering something in return. * 2 Parties * Each has something value to other party * Capable of communicating and delivery * free to accept or reject the exchange offer * Each believe that appropriate to deal with other.

Exchange & Transaction

Negotiation : Trying to arrive at mutually agreeable terms Transaction : Trade of values between 2 parties. with money a. Monetary transaction exchange b. Non Monetary or Barter In kind

Transaction consists of
1. 2 things of value 2. Agreed conditions 3. Time of agreement - Contract 4. Place of agreement Contract Transfer : Nothings in return Gift, subsides, charity. Transfer behavior or Transaction behaviour. Behavior Response is expected

Relationships

Building long term mutually satisfying relationship is To earn and retain long term preferences in business. Networks : consists of company and its supporting stakeholders like --* Customers, employees, supplies, distributors, retailers, Ad agencies etc. Profitable Business Relationships are built through Effective Network

MARKETING CHANNELS
1. Communication channel : Ad : deliver messages, newspaper, TV/radio, email, telephone, boards. 2. Distribution channels : warehouses, transportation, vehicles, distributors, wholesalers, retailers. 3. Selling Channels : are used in effecting transaction with potential buyers. Eg: Banks to facilitate SBI (Housing, Education, gold coins, Insurance policy) Task : to choose a proper mix of Communication, distribution and selling channels.

SUPPLY CHAIN MANAGEMENT

Supply Chain : connect marketer to the target buyer. a. Raw material / components to production unit b. Finished goods to final buyer. Competition : Include 1. Actual 2. Potential and 3.Substitutes.

Four Levels of Competition

1. Brand competition : who offer similar products / services same customers / same prices. Eg: cars of same class. 2. Industry Competition : All companies making same product or class of products. Eg: All cars. 3. Form competition: that supply same service car, auto, 2 wheelers. 4. Generic competition : companies compete for same consumer consumer durable, Automobile, homes, vacation.

Marketing Environment
Task Environment : involved in production, Distribute and promotion etc., Like a) Company b) Suppliers c) distributors d) Retailers e) target customers f) Mktg Research g) Ad companies h) Banking i)Insurance j) Transportation Broad Environment : 6 Components 1. Demographic 2. Economic 3. Natural 4. Technological 5. Political legal 6. Socio cultural.

Marketing MIX
4Ps - 4Cs Product / Customer Solution 1. Variety 2. Quality 3. Design 4. Features 5. Brand Name 6. Packaging 7. Size 8. Services 9. Warranty 10. Return Price / Customer Cost 1. List Price 2. Discount 3. Allowance 4. Payment Period 5. Credit Term Promotion / Communication 1. Sales Promotion 2. Advertising 3. Sales Force 4. PR 5. Direct Marketing Place / Convenience 1. Channels 2. Coverage 3. Assortments 4. Location 5. Inventory 6. Transport

Marketing Environment
Sales Promotion Products Company Services Prices Advertising Sales Force Public Relation Telemarketi ng Internet Distn. Channel Target Customer

Company Orientations towards Market Place 1. Production concept : holds that consumer prefer products that are widely available and inexpensive. Company high production efficiency, low cost, mass distribution. 2. The Product concept : consumer hold that consumers favour products of high quality,performance,innovative features etc., Marketing or customer needs are not considered here. Company has also to price, distribute, advertising properly.

Company Orientations towards Market Place 3. The selling concept : aggressive selling effort is required unsought goods like Insurance, books practice selling concept. 4. The marketing concept : to be more effective than competitors in creating, delivering, communication. Selling focus on Need of the seller. Marketing focuss on Need of the buyer

Company Orientations towards Market Place

Selling Concept
Starting Point Factory Focus Products Means Selling and Promoting Ends Profits through sales Volume

Marketing Concept
Target Market Customer Needs Integrated Marketing Profits through customer Satisfaction

Co-ordination within Marketing Dept and with other departments

When Marketing is necessary ? 1. Sales Decline 2. Slow Growth 3. Changing buying pattern 4. Increasing competition 5. Increasing marketing expenditure V. The Societal Marketing Concept 1. Environmental deterioration 2. Resource Shortages 3. Population growth 4. Inferior quality

Company Responses and Adjustments 1. 2. 3. 4. 5. 6. 7. 8. 9. Re- engineering Out sourcing E-commerce Bench marketing (Self improvement by adopting best principles) Alliances Partner suppliers Market centered Global and Local Decentralized.

Marketer Responses and Adjustments 1. Relationship Marketing 2. Customer Life time value 3. Customer Share 4. Target Marketing 5. Individualization 6. Customer Date base 7. Integrated Marketing communication 8. Channels as Partners 9. Every Employee a Marketer 10. Model based decision making