Intro Mkg Very Interesting

8/8/2019 Intro Mkg Very Interesting

1/76

What is Marketing?? Selling?

Advertising?

Promotions?

Making products available in stores?

Maintaining inventories?

All of the above, plus much more!


2/76

Marketing = ?

Marketing is the process of planning and executing the

conception, pricing, promotion, and distribution of ideas,

goods, services to create exchanges that satisfy individualand organizational goals

American Marketing Association


3/76

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.


4/76

Simple Marketing SystemSimple Marketing System

Industry(a collection

of sellers)

Market(a collection

of Buyers)

Goods/services

Money

Communication

Information


5/76

Who makes a market?

Consumer

Manufacturer (producer)

Retailer (customer)

MARKET


6/76

What is a Market?

A market is:

Place

PeopleDemand

6


7/76

Types of Markets

Marketplace is physical (Brick and Mortar)andMarket space is virtual (Click companies)

Examples !!!!!!!!!!!!!!


8/76

Evolution/History of Mktg1. Exchange concept -

2. Production concept

3. Product concept

4. Sales concept

5. Marketing concept

6. Societal marketing concept


9/76

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 starts with consumer needs and ends with consumer satisfaction.

Marketing is the most essential function of any business. It is most visibleand dynamic function.

Marketing is responsible for generating and meeting the Demand in the

market.

Marketing creates and sustains competitive capability of an organisation.

Marketing is all about managing the four Ps (also called as marketing mix) product

price

place

promotion


10/76

The Marketing Mix (4Ps of Mktg)


11/76

The 4 Ps & 4Cs

Marketing

Mix

Product

Price Promotion

Place

Customer

Solution

Customer

Cost

Communication

Convenience


12/76

Some more Ps !!!!!


13/76

What does marketerplan in the Ps?


14/76

Pricing is the only mix which generates a turnover for the organisation.Price must support the other elements of the mix which are costs to thecompany . Pricing is difficult and must reflect supply and demand

relationship.


15/76

Also called as marketing channels..


16/76

Place/ Distribution

Manufacturer

Consumer

Manufacturer

Retailer

Consumer

Direct Distribution Indirect Distribution


17/76

17

Typical Marketing Channels forTypical Marketing Channels for

Consumer ProductsConsumer Products


18/76


19/76

Promotion

Promotional Mix

Advertising

PublicRelations

SalesPromotion

Personal

Selling

DirectMail

Internet/E-commerce

A successful product or service means nothing unless the benefit

of such a service can be communicated clearly to the target market.An organisationspromotional mix can consist of:


20/76


21/76


22/76


23/76

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


24/76

Difference Between - Sales &

Marketing ?

Difference Between - Sales &

Marketing ?

Salestrying to get the customer to want what the

companyproduces push approach

Marketingtrying to get the company produce what the

customerwants pull approach


25/76

Scope of mktg

What do we market? Goods

Services

Events

Experiences

Personalities

Place

Organizations

Properties Information

Ideas and concepts


26/76

Needs, wantsdemands

Markets Marketing &

Marketers

Utility, Value &Satisfaction

Exchange, Transaction

Relationships

Products

Core Concepts of MarketingCore Concepts of Marketing


27/76

Core Concepts of Marketing- example !Core Concepts of Marketing- example !

Need food ( is a must )

Want Pizza, Burger, French fry's ( translation of a need as

per our experience ) Demand Burger ( translation of a want as per our

willingness and ability to buy )

Desire Have a Burger in a five star hotel


28/76

Marketing Triangle

Customers

CompetitionCompany


29/76

Who is a Customer ??

Anyone who is in the market looking at a product /

service for attention, acquisition, use or consumption

that satisfies a want or a need

CUSTOMER IS . . . . .


30/76


31/76

How Do Consumers Choose

Among Products & Services?

How Do Consumers Choose

Among Products & Services?

Value - the value or benefits the customers gain from using the

product versus the cost of obtaining the product.

Satisfaction - Based on a comparison of performance and

expectations.

Performance = Expectations => Satisfaction

Performance > Expectations => Delight

Performance < Expectations => Dissatisfaction


32/76

Customer looks forValueValue = Benefit / Cost

Benefit = FunctionalBenefit + Emotional

BenefitCost = Monetary Cost + Time Cost +

Energy Cost + Psychic Cost


33/76

The Give and Get of Marketing


34/76

Business exist

Create customer value =

SustainabilitySustainability


35/76

The Marketing ProcessThe Marketing Process

Business MissionStatement

Objectives

Situation orSWOT Analysis

Implementation

Evaluation, Control

Target Market Strategy

Marketing Strategy

Product

Promotion

Place/Distribution

Price

Marketing Mix


36/76

SWOT analysis

SWOT analysis is a tool for auditing anorganization and its environment.

It is the first stage of planning and helpsmarketers to focus on key issues. SWOTstandsforstrengths, weaknesses, opportunities, andthreats.

Strengths and weaknesses are internal factors.Opportunities and threats are external factors.


37/76

SWOT analysisstrength could be:

marketing expertise.

A new, innovative productor service.

Location of business.

Quality processes andprocedures.

Any other aspect of biz that

adds value to product orservice.

weakness could be:

Lack of marketingexpertise.

Undifferentiated products

or services (i.e. in relationto competitors).

Location of business.

Poor quality goods or

services. Damaged reputation.


38/76

SWOT

Opportunity could be:

A developing market such asthe Internet.

Mergers, joint ventures orstrategic alliances.

Moving into new marketsegments that offer improvedprofits.

A new international market.

A market vacated by anineffective competitor.

Threat could be:

A new competitor in homemarket.

Price wars withcompetitors.

A competitor has a new,innovative product orservice.

Competitors have superioraccess to channels of

distribution. Taxation is introduced on

product or service.


39/76

Example - Starbucks SWOTAnalysis.

Strengths - Starbucks Corporation is a very profitableorganization, earning in excess of $600 million in 2004.

Weaknesses - Starbucks has a reputation for new productdevelopment and creativity.

Opportunities - New products and services that can beretailed in their cafes, such as Fair Trade products.

Threats - Starbucks are exposed to rises in the cost ofcoffee and dairy products


40/76

Example -Nike

SWOT

Analysis.

Strengths - Nike is a very competitive organization,Nike is strong atresearch and development, Nike is a global brand, Nike has nofactories.

Weaknesses - The organization does have a diversified range ofsports products.

Opportunities - Product development offers Nike manyopportunities, develop products such as sport wear, sunglassesand jewellery - high value items strong global brand recognition.

Threats - Nike is exposed to the international nature of trade, Themarket for sports shoes and garments is very competitive. Easilycopied.


41/76

Business Strategic-PlanningProcess

External environment

(Opportunity &

Threat analysis)

Internal Environment

Strength/ Weakness analysis)

Goal FormulationBusiness Mission


42/76

Strategy FormulationEnvironmentalAnalysis

InternalAnalysisCompetitorCustomerSupplier

RegulatorySocial/ Political

Technology Know-HowManufacturing Know-How

Marketing Know-How

Distribution Know-HowLogistics

Strength & Weaknesses

Identity Core Competencies

Opportunities & Threats

Identify opportunity

Fit internal Competencies with external opportunities

Firm Strategies


43/76

Marketing

Environment

Marketing

Environment


44/76

Why a product like radio declined

and now once again emerging asan entertainment medium ?


45/76

What Were the Drivers of ThisChange ?

Technology ?

Government policy ?

Other media substitutes ?


46/76

Why Market LeadersSuffered ?

HMT vs. Titan

HLL vs. Nirma

Bajaj vs. Honda

Dot.com boom, then bust and now resurgence

Market leadership today cannot be taken for granted.

New and more efficient companies are able to upstage

leaders in a much shorter period.


47/76

What Changed in Marketing

Organize by product units Focus on profitable transactions

Look primarily at financialscorecard Focus on shareholdersMarketing does the marketing Build brands through advertising Focus on customer acquisitionNo customer satisfaction

measurementOver-promise, under-deliver

Organize by customer segments Focus on customer lifetime value

Look also at marketing scorecard Focus on stakeholders Everyone does the marketing Build brands through performance Focus on customer retention Measure customer satisfaction and

retention rate Under-promise, over-deliver

Old Economy New Economy

C dC d


48/76

Challenges

Faces shifting consumer

lifestyles and preferences

for healthier foods.

Low ratings of food andservice quality.

Atmosphere not upscale.

Image is perceived as

being uncultured, uncool,and unclassy byyounger

target markets.

Case studyCase study

McDONALDSMcDONALDS Facing New ChallengesFacing New Challenges

Marketing Initiatives Focus on core competency

of consistent products and

reliable service.

Offers upscale alternativesincluding McCafe and

Bistro Gourmet.

Eliminates supersize,

offers healthier foodoptions, and introduces Go

Active! Adult Happy Meal.


49/76

Marketing Environment

Consists of actors and forces outside theorganization that affect managements ability tobuild and maintain relationships with targetcustomers. Studying the environment allows marketers to take

advantage of opportunities as well as to combat threats.

Marketing intelligence and research are used to collect

information about the environment.


50/76

Marketing Environment

Micro environment:

Companys Internal

Environment or

forces that affect its

ability to serve its

customers.

Normally in controlof the company

Macro environment:

larger societal

forces. beyond the

control of theorganization.


51/76


52/76

March 12, 2000 Private & Confidential 52

MICROENVIRONM

ENT


53/76

Actors in the micro environmentinclude:

The company itself

Suppliers

Marketing intermediaries Customers

Competitors

Publics


54/76

The Microenvironment

Suppliers: Provide resources needed to produce goods and

services. Important link in the value delivery system.

Most marketers treat suppliers like partners.


55/76


Marketing intermediaries: Help the company to promote, sell, and distribute

its goods to final buyers Resellers

Physical distribution firms

Marketing services agencies

Financial intermediaries


56/76


Customers: Five types of markets that purchase a companys

goods and services. Consumer

Business

Reseller

Government International


57/76


Competitors: Those who serve a target market with products

and services that are viewed by consumers asbeing reasonable substitutes.

Company must gain strategic advantage againstthese organizations.


58/76

Publics: Any group that has an interest in or impact on an

organization's ability to achieve its objectives.

Financial public Media public

Government public

Citizen-action public

Local public

General public Internal public



59/76

March 12, 2000 Private & Confidential 59

MA

CROE

NVIRONME

NT

F i h i b


60/76

Forces in the macro evironment can becategorized as:

Demographic

Economic

Natural

Technological

Political

Cultural


61/76

Demographic Environment

Demographics:The study of human populations in terms of size,density, location, age, gender, race, occupation,and other statistics. Marketers track changing age and family structures,

geographic population shifts, educational characteristics,and population diversity.


62/76


The changing age structure of the U.S.population is the single most important

demographic trend. Baby boomers, Generation X, and Generation Y

are the key groups.


63/76


Baby Boomers: 78 million born between 1946 and 1964.

Equal 28%

of population. Earn more than 50% of all personal income.

Almost 25% belong to racial or ethnic minority.

Spend a lot on anti-aging products and services.

Are likely to postpone retirement.


64/76


Generation X: 45 million born between 1965 and 1976.

Defined by shared experiences: Increasing divorce rates.

More of their mothers employed.

First generation of latchkey kids.

Cynical of frivolous marketing pitches.

Care about the environment.

Prize experience, not acquisition.


65/76


Generation Y: 72 million born between 1977 and 1994.

Have large amount of disposable income.

Comfortable with computer technology.

Tend to be impatient and Now-Oriented.

Many product lines targeted at those who arepart of Generation Y: Teen and young adult games

Clothes, furniture, food


66/76

Economic Environment

Changes in Income 1980s consumption

frenzy

1990s squeezedconsumer

2000s valuemarketing

Income Distribution Upper class

Middle class

Working class

Underclass

Consists of factors that affect consumerpurchasing power and spending patterns.


67/76

NaturalE

nv

ironment Involves natural resources that are needed as

inputs by marketers or that are affected bymarketing activities.

Factors include: Shortages of raw materials.

Increased pollution.

Increased government intervention.

Environmentally sustainable strategies.


68/76

Technological Environment

Most dramatic force shaping our destiny.

Changes rapidly.

Creates new markets and opportunities.

Challenge is to make practical, affordableproducts.

Safety regulations result in higher research costs

and longer time between conceptualization andintroduction of product.


69/76

Political Environment

Includes laws, government agencies, andpressure groups that influence or limit variousorganizations and individuals in a given society.

Areas of concern: Increasing legislation.

Changing government agency enforcement.

Increased emphasis on ethics and socially responsible

behavior.


70/76

Cultural Environment

The institutions and other forces that affect asocietys basic values, perceptions, preference,and behaviors. Core beliefs and values are passed on from parents to

children and are reinforced by schools, churches,business, and government.

Secondary beliefs and values are more open to change.

Marketers may be able to change secondary beliefs, butNOT core beliefs.


71/76

CulturalE

nv

ironment Societys major cultural views are

expressed in peoples views of:

Themselves Others

Organizations

Society

Nature

The universe


72/76

S

ocio cultural issues! What is the dominant religion?

What are attitudes to foreign products and services?

Does language impact upon the diffusion of products ontomarkets?

How much time do consumers have for leisure?

What are the roles of men and women within society?

How long are the population living? Are the older generationswealthy?

Do the population have a strong/weak opinion on greenissues?

Beliefs in a society


73/76

Describe the environmental forces that affect thecompanys ability to serve its customers.

Explain how changes in the demographic and economicenvironments affect marketing decisions.

Identify the major trends in the firms natural andtechnological environments.

Explain the key changes in the political and culturalenvironments.

Discuss how companies can react to the marketingenvironment.

Questions for discussion


74/76

Challenges of marketing in the 21st

century

Outsourcing

Alliances

E-commerce increasing global competition/Globalization

Technological innovations

Fast changing consumer preferences Decentralization


75/76

Challenges of marketing in the 21st

century

need for integrated marketing

Customization

Need to build customer database Customer retention

Brand building through performance


76/76

Documents

Intro Mkg Very Interesting