Marketing Management

Module-1
 INTRODUCTION TO MARKETING

 The term marketing which refers to a group of sellers

and buyers that co- operates to exchange goods and
services. The modern concept of marketing evolved
during and after the industrial revolution in the 19th
and 20th centuries.
 A market is a place which allows the purchaser and the

seller to invent and gather information and lets them

carry out exchange of various products and services. In
other words the Meaning of Market refers to a place
where the trading of goods takes place. The place can
be a market place or a street market.
MEANING OF 'MARKETING MANAGEMENT'

 Marketing is that economic activity by which the

commodities and services are acquired in exchange of
money. It means that activity or activities which are
directed with a specific motive of transferring the
products from production point to the final
consumption point.
Definition
 American Management Association (1960) -
"Marketing is the performance of business activities
that direct the flow of goods and services from
producer to consumer or user."
TYPES OF MARKET
 Consumer Markets
 Business Markets
 Global Markets
 Government or Non-profit Market
DIFFERENT CONCEPTS OF
MARKETING
 The Exchange concept
 The Production Concept
 The Product Concept
 The Selling Concept
 The Marketing Concept
 The Societal Marketing Concept
 DIFFERENCE BETWEEN SELLING AND
MARKETING
SELLING MARKETING
Selling starts with the seller, and is preoccupied all the time Marketing starts with the buyers and focuses constantly on
with the needs of the seller and the seller’s existing their needs.
products.

Seller is the centre of the business universe. Buyer is the centre of the business universe;
activities follow the buyer and
his needs.

Emphasis is on saleable surplus available with the corporation. Emphasis is on identification of a customer need/market
opportunity. The aim is to convert customer ‘needs’ into
‘products’.

Concerns itself with just the tricks and techniques of getting Concerns itself with fulfilling the needs of the customers.
the customers to part with their cash for the products
available with the salesman.

Views business as a ‘goods producing Views business as a ‘customer satisfying

processes’. process’.
Over-emphasises the ‘exchange’ aspect, without caring for the Concerns itself primarily and truly with the ‘value satisfactions’
‘value satisfactions’ that should flow
inherent in the exchange. to the customer from the exchange.
Sellers’ requirement and preference Buyer determines the shape the ‘marketing
dominates the formulation of the ‘marketing
mix’ should take.
mix’.

The firm makes the product and then The product is determined by the buyer.
figures out how to sell it.
 VALUE CONCEPT OF MARKETING
CUSTOMER VALUE

 Customer value is the satisfaction a consumer feels

after making a purchase for goods or services relative
to what she must give up to receive them. A consumer
doesn't consider value just in terms of money spent, but
can also consider the time it takes to obtain a purchased
product and interactions with customer service
personnel.
 Marketing identifies this ‘bundle of benefits’ as value

or as the carrier of value. All buyers seek value in all

their purchases and they look for it in the form of
benefits. The benefits can be tangible or intangible.
VALUE CONCEPT OF MARKETING
CUSTOMER VALUE

The formula for customer value can be written as:

 (Total Customer Benefits - Total Customer Costs) =

Customer Value, or (B - C = CV).

 The customer reckons tangible benefits like the
functional utility of the product, convenience of
usage, etc., as well as the intangible benefits like the
experience/prestige/brand image associated with the
product. While analyzing a particular offering, the
customer reckons the various benefits and assigns on
the priority assigned to each of them by the customer
Total Customer Cost

 The buyer also incurs some costs in acquiring these

benefits. This is called the customer cost. This cost
includes the price of the product plus all other elements
of cost, economic and non-economic, incurred in
acquiring it. The sum total of all the costs a customer
incurs in acquiring the product is called the Total
Customer Cost
 COMPONENTS OF CUSTOMER VALUE

 Tangible Values
 Functional Value: Functional value mainly denotes the ability of
a product to meet a given need.
 Economic Value: When the customer observes a price advantage
in a product/brand, it is an economic value.
 Convenience Value: Easy procurability of the product or service
and convenience in application/use of the product.
 Sensory and Aesthetic Value: Sensory value refers to the taste,
looks, smell, sound and touch of the product.
 Service (People) Value: Service value encompasses promptness
and quality of service, as well as good customer relationship.
COMPONENTS OF CUSTOMER VALUE

 Intangible Values
 Social Value: A product has social value when its use confers social
acceptance or social desirability on the consumer
 Prestige/Status Value: A product has prestige/status value when its

possession contributes to the user’s sense of status/esteem.

 Sentiment Value: Sentiment value refers to a product’s capacity to

stimulate some sentiments/memories/past associations while using

that product.
 Experience Value: Providing convenience of use

Providing good after-sales service

 Belief Value: A product has belief value when it helps the user

reconfirm his religious/cultural beliefs.

MARKETING ETHICS
 Ethical marketing is less of a marketing strategy and
more of a philosophy that informs all marketing efforts.
It seeks to promote honesty, fairness, and responsibility
in all advertising. Ethics is a notoriously difficult
subject because everyone has subjective judgments
about what is “right” and what is “wrong.” For this
reason, ethical marketing is not a hard and fast list of
rules, but a general set of guidelines to assist
companies as they evaluate new marketing strategies.
GREEN MARKETING

 Green Marketing is the marketing of products that are

presumed to be environmentally safe. It incorporates a
broad range of activities, including product
modification, changes to the production process,
sustainable packaging, as well as modifying
advertising.
 In simple terms green marketing refers to the process

of selling products and/or services based on their

environmental benefits. Such a product or service may
be environmentally friendly in itself or produced and/or
packaged in an environmentally friendly way.
GREEN ECONOMY

 "The Green Economy is one in which the vital linkages

among the economy, society, and environment are taken into
account and in which the transformation of production
processes, and consumption patterns, while contributing to a
reduced waste, pollution, and the efficient use of resources,
materials, and energy, will revitalize and diversify economies,
create decent employment opportunities, promote sustainable
trade, reduce poverty, and improve equity and income
distribution."
 Green Economy is the one that results in improved human
well-being and social equity, while significantly reducing
environmental risks and ecological scarcities.
MARKETING MYOPIA
 Marketing Myopia is a concept developed by Theodore
C. Levitt in 1960, which says that companies focus on
their needs & short term growth
strategies instead of taking care of the needs & wants of
the consumer & therefore fail due to their short-
sightedness.
 The firm is not able to adapt themselves to the highly
dynamic market
 where consumer needs & wants are changing frequently.
The company is not able to predict future & think on
long terms.
MARKETING ENVIRONMENT

 The overall Marketing environment is the snowballing

form of the aspects that encapsulate inside themselves the
capability of a firm to bond with the customers and also,
the strength of the product as a driver of development to
the firm. The macro-environment consisting of wider
societal authorities, and the micro-environment which
incorporates the influences related to a company, together
form the general marketing environment of a company.
The marketing environment is made up of :
• Micro environment.
• Macro-environment
Micro environment.

 Suppliers
 Marketing Intermediaries
 Resellers
 Distribution Centers
 Marketing Agencies
 Financial Intermediaries
 Customers
 Competitors
Macro-Environment
 Demographic Environment
 Economic Environment
• Inflation
• Interest Rates
• Unemployment
• Customer Income
 Natural Environment
 Socio-Cultural Environment
 Technological Environment
 Political and Legal Environment
TECHNIQUES USED IN ENVIRONMENT
ANALYSIS

 SWOT Analysis:
SWOT is a widely used thinking framework for identifying Strengths,
Weaknesses, Opportunities and Threats. It enables key factors to be
visibly recorded as a high-level summary of a business. SWOT
analysis is a summary that is simple but powerful. The technique is
commonly used by consultants to document the key factors arising
from the review of a particular project or business. The use of SWOT
enables an assessment to be made of the overall internal state of a
business and the direction in which it is heading, through looking at
its Strengths and Weaknesses. It also enables a judgment to be made
about aspects of the external business environment, which can affect
the performance of the business, through looking at the Opportunities
and Threats it faces in the wider world.
TECHNIQUES USED IN ENVIRONMENT ANALYSIS

 Technique-2: PEST Analysis:

 Political Factors – may have direct or indirect impact on the
organization’s operation. Decisions made by the government may
have an effect on the business.
 Economic Factors – the organization is affected by economic factors.
Economy also affects the purchasing power and behavior of the
consumers.
 Sociological Factors – Include the demography, lifestyle, cultural
aspects of the consumers. These factors have a big influence on the
consumer needs and wants. Sociological factors also affect the size of
potential markets
 Technological Factors – technological change plays an important role
in shaping how organizations operate. Technological factors are
important in gaining competitive advantage.
TECHNIQUES USED IN
ENVIRONMENT ANALYSIS
Technique-3: Forecasting
 Forecasting means predicting future events and

analyzing their impact on plans. Organizations analyze

the environment by applying various techniques to
forecast Government policies, sales, technological
developments etc. and use that information to
formulate plans and strategies.
TECHNIQUES USED IN
ENVIRONMENT ANALYSIS
 Technique-4: Verbal and Written Information
Verbal information is collected by hearing and written information is
collected by reading articles, journals, newspapers, newsletters etc. Common
sources of verbal information are radio, television, work force, outsiders
(consumers, suppliers, bankers) etc. It informs changes in the environment
and prepares organizations to incorporate them in their plans and strategies.
 Technique-5: Management Information System (MIS)

MIS is “a formal method of making available to management the accurate

and timely information necessary to facilitate the decision-•making process
and enable the organization's planning, control and operational functions to
be carried out effectively.”
MIS provides timely, accurate, concise, complete and relevant information
based on computer technology about present and future environmental
changes. It facilitates decision-making process and helps in making decisions
based on future environment.
CONTEMPORARY INDIAN MARKETING ENVIRONMENT CAUSE
MARKETING

 Cause Marketing refers to aligning a brand with a

cause to produce
 profitable and societal benefits for both parties. These

mutual benefits can include the creation of social value,

increased connection with the public, and the
communication of shared value, as well as profit.
CONTEMPORARY INDIAN MARKETING
ENVIRONMENT CAUSE MARKETING

 Benefits of Cause Marketing

 Cause marketing involves increasing exposure as well

as awareness for both for-profit businesses and non-

profit organizations. When cause marketing is
effective, it offers immense benefits like:
 An enlargement in brand loyalty
 Boost up in employee morale
 Growth in sales
 Company reviews as well as positive press coverage
 Distinction from the competition
SOCIAL MARKETING

 Social marketing is the systematic application of

marketing along with other concepts and techniques to
achieve specific behavioral goals for a social good. For
example, this may include asking people not to smoke in
public areas, asking them to use seat belts or prompting
to make them follow speed limits.
 The primary aim of social marketing is ‘social good’,
whereas in commercial marketing the aim is primarily
‘financial’. This does not mean that commercial marketers
cannot contribute to achievement of social good.
Advantages of Social Marketing:

 Social marketing—a new marketing tool—can be a

great asset if used properly. The beneficial effects of
social marketing for a business can be tremendous, but
one must remember that it must be used in the most
efficient possible way.
 Social marketing allows businesses and web sites to

gain popularity over the Internet by using different

types of social media available, such as blogs, video
and photo sharing sites, social networking sites and
social bookmarking web sites.
3V CONCEPT

 The 3V marketing mix is an alternative and

supplemental method which aids in determining a
company´s product strategy as well as product
portfolio.
 Valued customer– seeking the answer to the

question: Who to serve?

 Value proposition – seeking the answer to the

question: What to offer?

 Value network– seeking the answer to the question:

How to offer?
CORPORATE SOCIAL RESPONSIBILITY

 The term Corporate Social responsibility refers to the

concept of business being accountable for how it
manages the impact of its processes on stakeholders
and takes responsibility for producing a positive effect
on society.
CORPORATE SOCIAL RESPONSIBILITY

Why CSR at All?

 Business cannot exist in isolation; business cannot be

oblivious to societal development. The social

responsibility of business can be integrated into the
business purpose so as to build a positive synergy
between the two.
EMERGING AREAS OF MARKETING
 Neuro Marketing is the formal study of the brain's
responses to advertising and branding, and the
adjustment of those messages based on feedback to
elicit even better responses. Researchers use
technologies such as functional magnetic resonance
imaging (fMRI) and electroencephalography (EEG) to
measure specific types of brain activity in response to
advertising messages. With this information,
companies learn why consumers make the decisions
they do, and what parts of the brain are motivating
them to do so.
SENSORY MARKETING

 The senses play a key role in consumer perceptions and

exert a powerful influence over buying decisions.
Marketers have long sought to integrate the senses into
brand communications, albeit generally in a limited and
partial way. Today, sensory marketing is recognized as
an essential tool for strengthening the connection
between brand and consumer by stimulating all the
senses and generating emotions.