Description
Marketing management is a business discipline which is focused on the practical application of marketing techniques and the management of a firm's marketing resources and activities.
MARKETING
• Marketing is the process of planning and executing the conception, promotion and distribution of ideas, goods, services, organizations and events to create and maintain relationships that will satisfy individual and organizational objectives.
- Boone & Kurtz.
•Marketing is the social process by which individuals and groups obtain what they need and want through creating and exchanging products and value with others. - Kotler • Marketing is an organizational function and a set of processes for creating, communicating and delivering value to customers and for managing the customer relationships in ways that benefit the organization and its stake holders. - American Management Association
IMPORTANT ELEMENTS OF MARKETING
• Marketing focuses on the satisfaction of customer needs, wants and requirements. • The Philosophy of Marketing needs to be owned by everyone from within the organization. • Future needs to be identified and anticipated. • Focus on the Profitability in case of Corporate Sectors. • Recent definitions recognizes the influence of Marketing upon society.
SCOPE OF MARKETING
• • • • • • • • • • • • • Spot and choose right marketing segment. Know how to differentiate our offerings. Handle Price Objections. Compete against lower cost and lower price competitors. Customize the offerings. Grow on Business. Build stronger Brands. Reduce the cost of customer acquisitions. Keep the customers loyal for long. Measure the effects of Advertisement , Sales Promotion & PR. Improve Sales Force’s Productivity. Establish and Manage multiple channels. Effectively resolve channel conflicts and remain customer oriented.
WHAT IS
MARKETED ?
physical goods. airlines, beauticians, car rentals amusement parks, dolari-dhani celebrities , film stars / sports trade shows, olympic / sports real estate, stocks and bonds. corporate identity ads etc., encyclopedias , package labels aids awareness / disc. smoking states, cities, regions, tourism
• • • • • • • • • •
Goods Services Experiences Persons Events Properties Organizations Information Ideas Places
-
MARKET
• • Physical place where buyers and sellers gathered to buy and sell goods. Refers to the group of consumers or organizations that is interested in the product, has the resources to purchase the product, and is permitted by law and other regulations to acquire the product. Total Population Potential Market Available Market Qualified Available Market Target Market Penetrated Market - those who have interest in buying - those who have enough resources to buy - those who are legally permitted to buy - the segment the firm decided to serve - those who have purchased the product
• • • • • •
MARKET PLACE Vs MARKET SPACE
• Market Place Physical in nature Ex. shopping in a store Vs Market Space digital in nature shopping on the Internet
• Metamarket – cluster of complimentary products and services that are closely related in the minds of consumers but are spread across diverse set of industries.
• Ex – Automobile metamarket – automobile manufacturers, new & old car dealers, financiers, ins.co.mechanics, spare parts dealers , service shops, auto magazines, auto sites on Internet , auto ads etc.,
KEY MARKETS
• Consumer Markets – Consumer goods , cosmetics, soft drinks etc.,
a. superior brand image b. superior product quality, packaging etc., c. availability and reliable service • Business Markets - Co s selling business goods & services.
a. well informed professional buyers b. stronger role played by sales force , price & co ’s reputation for reliability and quality.
KEY MARKETS
• Global Markets – companies selling goods and services in the global markets. a. pricing in difft. countries. b. product and service features. c. culture , language , political systems , currency • Non – Profit & Governmental Markets – co s selling their goods and services to non-profit organizations or govt. agencies. a. carefully priced b. lowest bid favoured
MARKETING – NEW OPPORTUNITIES & CHALLENGES
• Changing technology – digital revolution , Information age
•
• •
Globalization - technological advances in transport , shipping & com
Deregulation – greater competition and growth opportunities Privatization – increase in efficiency
•
• •
Customer empowerment – customer expect higher quality & service
Customization – personalized services Industry convergence – add on products / services by cos.
•
•
Retail transformation – marketing an experience
Disintermediation – delivery of products / services thru’ on – line.
MARKETING MANAGEMENT
• 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.
MARKETING CONCEPTS
• Needs , Wants & Demands Needs – Basic human requirements * stated needs * real needs * unstated needs * delight needs * secret needs * Needs become wants when people are directed to specific objects that might satisfy the need. * Demands – wants for specific products backed by an ability to pay.
MARKETING CONCEPTS
• Segmentation – Division of the market in to various segments by analyzing the profile of buyers based on their demographic , psychological and behavioral patterns.
• Target Markets – segments present the greatest opportunity. • Positioning – The market offering ( product ) is positioned in the minds of target buyers as delivering some central benefits.
MARKETING CONCEPTS
• Offerings & Brands – Offering is a value proposition , a set of benefits companies offer to customers , to satisfy their needs. • Brand – an offering from a known source and carries many associations in the minds of people. • Value & Satisfaction – tangible & intangible benefits to customers.
MARKETING CONCEPTS
• Marketing Channels – to reach the target market
* communication channels – radio, t v, magazines , mail , posters * distribution channels - distributors , wholesalers, retailers , agents * service channels – to carryout the transaction with potential buyers - warehouses, banks, ins. , transportation cos..
•
•
Supply Chain – A longer channel stretching from raw materials to components and to final products that are carried to final buyers.
Competition – Includes all the actual and potential rival offerings & substitutes that a buyer might consider.
MARKETING CONCEPTS
• Marketing Environment
* Task Environment – production, distribution and promotion depts. * Involves company, suppliers, distributors, dealers & target cust.
* Broad Environment – consists of 6 components. * demographic environment * economic environment * physical environment * technological environment * political – legal environment * social – cultural environment
* Market Planning – analyzing mkt opportunity , selecting target mkt , designing mkt strategy, developing mktg programme, managing mktg effort.
MARKETING PHILOSOPHIES
• 1.Production Concept • 2.Product Concept • 3.Selling Concept
• 4.Marketing Concept
• 5.Holistic Marketing Concept
a. Relationship marketing b. Integrated marketing c. Internal marketing d. Social Responsibility marketing
MARKETING PHILOSOPHY – THE PRODUCTION CONCEPT
• One of the Oldest concepts prevailed from the time of industrial revolution until 1920’s. • Its an idea that the firm should focus on those products that it could produce most efficiently. • Production and supply of low cost products will in turn create demand that leads to consumers preferring widely available , inexpensive products.
• Ex : China’s ‘ Legend’ – PC mfr. & Haier – appliances co.
: took advantage of the country’s inexpensive labor pool
MARKETING PHILOSOPHY
• • • • • • The Product Concept Termed as make & sell philosophy Consumers favor products of high quality, performance, innovative features. The Selling Concept This concept emerged by the early 1930s. Companies not only would produce the products, but also would try to convince customers to buy them through advertising and personal selling. ‘ The purpose of marketing is to sell more stuff to more people more often for more money in order to make more profit.’ – - By an aggressive sales man.
•
MARKETING PHILOSOPHY – THE MARKETING CONCEPT
• This concept emerged in mid-1950s. ( after world war II )
• Customer centered philosophy ( ‘ sense and respond’ )
• Focuses on the customer needs before developing the product. • Aligns all functions of the company to focus on those needs. • Realizes a profit by successfully satisfying customer needs over the long term. • Reactive Market orientation – understanding and meeting customers’ expressed needs. • Proactive Market orientation - satisfy customers’ latent ( hidden – unsaid ) needs also.
MARKETING PHILOSOPHY – THE HOLISTIC MARKETING CONCEPT
• Based on the development, design, and implementation of marketing programs, processes, and activities that recognizes their breadth and inter-dependencies. • Four components of Holistic Marketing are * Relationship Marketing * Integrated Marketing * Internal Marketing * Social Responsibility Marketing * Holistic Marketing attempts to recognize and reconcile the scope and complexities of marketing activities.
HOLISTIC MARKETING - COMPONENTS
• • • • • • • • • Relationship Marketing To develop deep, enduring relationships with all people or organizations that could directly or indirectly affect the success of the firm’s marketing activities. Aims to building mutually satisfying long term relationships with key parties – customers, suppliers , distributors and other marketing partners in order to earn and retain their business. CRM & PRM to be strengthened. To build a unique company asset called marketing network. Integrated Marketing a program to create, communicate & deliver value for consumers. Mktg Mix – set of marketing tools a firm uses to pursue its marketing operations. McCarthy’s Four P’s of Marketing
HOLISTIC MARKETING - COMPONENTS
•
• • •
4 P’s – Product , Price , Place & Promotion.
Internal Marketing Is the task of hiring, training and motivating able employees who want to serve customers well. Various marketing functions – sales force , advertising , customer service , product mgt. , marketing research must work together. Social Responsibility Marketing Incorporates ethical , environmental , legal and social context of marketing activities and programs. Marketers to build social and ethical considerations in to their marketing practices.
• •
•
•
Cause – Related Marketing – Co. with an image, product , or service to market builds a relationship or partnership with the ‘ cause ’ or for mutual benefit.
LATEST TRENDS IN MARKETING
Fundamental Mktg Trend
• • • • • • • Marketing for the organization Organizing by product units Making everything By own Using Many suppliers Relying on old Market Positions Emphasizing Tangible Assets Building brands thru’ Ads
Latest Trend in Marketing
* Marketing to everyone in the org. * Organizing by customer segments. * Outsourcing Prods, Sub-contracting * ‘ partnership’ with few suppliers. * Exploring New Mkts with Innovation. * Emphasizing intangible assets. * Building brands thru’ performance & integrated communications.
LATEST TRENDS IN MARKETING
•
•
Fundamental Mktg Trend
B2C – thru’ stores & sales people Selling to Everyone Focusing on Profitable transactions Focus on gaining mkt. share Local adaptation thru’ Centralization & De-centralization strategy Focusing on the Financial strength
Latest Trend in Marketing
* B2B thru’ Online ( Internet Mktg ) * Selling to well defined target markets * Focus on customer lifetime value * Focus on building customer share * Global Standardization
• • • • •
* Focusing on Marketing Strength
•
Focusing on Shareholders’ prosperity
* Focus on Stakeholders’ prosperity
MARKETING MANAGEMENT TASKS
• • • • Developing Marketing strategies & Marketing Plans Capturing Marketing insights – Marketing Information Systems Marketing Environment – Micro ( suppliers , customers , channels, competitors ) Marketing Environment - Macro ( demographic , economic , physical, technology
political – legal, social – cultural forces )
•
• •
Connecting with customers –
Building strong brands
create value for the chosen target mkt. & develop strong, profitable, long term relationships with customers.
Shaping the Market Offerings – Product quality, design features, packaging
MARKETING MANAGEMENT TASKS
• • • Delivering Value – by products & services to the target market. Communicating Value – Marketing communication activities. Develop Integrated Marketing communication program – an attempt
to inform, persuade , remind the customers on the products & services – directly or indirectly, about the brands the cos. Sell.
•
•
Set up Mass Communication Programs – Advertising , Sales Promotion ,
events , Public relations, hire , train & motivate sales people.
Creating Long term Growth – Product Positioning , New Product Development
testing , launching & analyzing the changing global opportunities & challenges etc.,
•
Organize Marketing Resources & Implement & Control Marketing Plan
• •
Describes the strategic position of the product in the market place.
MARKETING MIX
Marketing Mix Theory origin – 1948 – By James Culliton. ‘ Marketing decision should be the result of something similar to recipe’
•
• • • • • •
1953- Neil Borden – President of AMA – changed the recipe idea & introduced term ‘Marketing Mix’.
1960 – E. Jerome McCarthy – Introduced 4Ps. Product – An object or service that is mass produced or manufactured on a large scale with a specific volume of units. Price – the amount customer pays for the product. Place – a location where the product can be purchased. Promotion – all of the communications that a marketer may use in the market place. Some Marketing experts still say..5Ps…others say Extended 7Ps….( People , Physical Evidence – Uniforms, Business Cards, Signages & Process – the whole customer experience ) – 7Ps applicable for service oriented companies.
MARKETING MIX – 4 Ps
( To generate positive response in the target market by blending these 4 marketing mix variables in an optimal manner )
Product
Price Target Market
Place
Promotion
MARKETING MIX - PRODUCT
• Product Characteristics : * Functionality * Quality * Appearance * Packaging * Brand * Service * Support * Warranty
MARKETING MIX - PRICE
• • • • • • Price Characteristics : List Price Discounts Financing Leasing Options Allowances
MARKETING MIX - PLACE
• • • • • • • • Place Characteristics : Locations Logistics Channel Members Channel Motivation Market Coverage Service Levels Internet / Mobile
MARKETING MIX - PROMOTION
• • • • • • • • •
Promotion Characteristics : Advertising Public Relations Trade Show Personal Selling Direct Selling Media Leaflets Discounts Offers
MARKETING STRATEGY FORMULATION
• • • • • • •
Identifying the target market Product Positioning Product pricing Distribution Marketing Communications Marketing Research Gathering Feedback & exercising control
Analysis of market situation & Forecast of future marketing Environment development
Analysis Phase
Determining of marketing goals •Market share •Sales Volume •Image •Awareness
Formulation of marketing strategies • Market field strategies • Market stimulation strategies • Market parceling strategies • Market area strategies • Competition oriented strategies
Planning Phase
Planning market policy activities •Product policy • Pricing •* Communication •Distribution Policy
Realization of the marketing decision
Implementation phase
Control of marketing success
Control phase
MARKETING STRATEGIES
• • • • • • • • Defining the corporate mission Defining the Business The Business Mission Goal Formulation Strategy Formulation Program formulation Implementation Feedback & Control
MARKETING PLAN
• • Marketing Plan is a written document that summarizes what the marketer has learned about the market place and indicates how the firm plans to reach its marketing objectives. It contains the tactical guidelines for the marketing programs and financial allocations over the planning period. Contents of Marketing Plan Executive summary and table of contents – brief summary of the main goals and recommendations. Situational analysis – relevant back ground data on sales , costs , the market , competitors , and the various forces in the macro – environment. Marketing strategy Financial projections – sales forecast, expense forecast, break even analysis etc., Implementation controls – control mechanisms for monitoring and adjusting implementation of the plan.
• •
•
• •
•
MARKETING ENVIRONMENT
• MACRO ENVIRONMENTAL FORCES • 1. DEMOGRAPHIC ENVIRONMENT • 2. ECONOMIC ENVIRONMENT • 3. SOCIAL – CULTURAL ENVIRONMENT • 4. NATURAL ENVIRONMENT • 5. TECHNOLOGICAL ENVIRONMENT
• 6. POLITICAL – LEGAL ENVIRONMENT
DEMOGRAPHIC ENVIRONMENT
• Marketers must be aware of * worldwide population growth * changing mixes of age * ethnic composition & educational levels * rise of non-traditional families * large geographic shifts in population * shift from mass marketing to micromarketing
ECONOMIC ENVIRONMENT
• Marketers need to focus on • • • • Income distribution Levels of savings Debt availability Credit availability
SOCIAL – CULTURAL ENVIRONMENT
• Marketers must understand the societal factors such as beliefs, values and norms that largely define the tastes and preferences of target buyers.
•
Indian Social – Cultural environment very complex - consists of regional differences in language, customs, social systems, values, caste systems, habits and religions.
Marketer must address the target market with • Customized research on consumption behavior • Customized research on attitudes of buyers specific to products and services.
•
NATURAL ENVIRONMENT
• Marketers need to be aware of the threats and opportunities associated with • Raw materials shortages • Increased Energy costs • Pollution Levels • Changing role of governments in environmental protection • New regulations by Central / State Governments.
TECHNOLOGICAL ENVIRONMENT
• Marketers should take account of • Accelerating pace of technological change
– Increasing no. of ideas
• Opportunities for innovation
– Startling range of new technologies that will revolutionize products & production processes.
• Varying R&D Budgets
– Increased opportunities in the R&D sector due to globalization.
• Increased governmental regulations of technological change
– Increased awareness on the safety of products leading to Govt. banning potentially unsafe products.
POLITICAL – LEGAL ENVIRONMENT
• Political – Legal environment composed of laws , government agencies , pressure groups that influence and limit various organizations and individuals.
Increase in Business Legislation – 1. to protect cos. From unfair competition 2. to protect consumers from unfair business practices 3. to protect the interests of society from unbridled business behavior. – consumer protection regulation , consumer complaints council ( CCC ) 4. NCDRC – National consumer disputes Redressal Commission.
•
SWOT Analysis
• Is an important tool for auditing the overall strategic position of a business and its environment. • It involves monitoring the external and internal marketing environment. • Environmental factors internal to the firm usually can be classified as strengths ( S ) or weaknesses ( W ) and those external to the firm can be classified as opportunities ( O ) or threats ( T ) – This analysis of the strategic environment is referred to as a SWOT Analysis.
SWOT FRAMEWORK
ENVIRONMENT SCAN
Internal Environment Analysis
External Environment Analysis
Strengths
Weaknesses
Opportunities
Threats
Internal Environment ( Strengths / Weaknesses ) Analysis
( The internal analysis is a comprehensive evaluation of internal environment’s potential strengths & weaknesses )
•
• • • • • • • • •
Strengths – A firm’s strengths are its resources and capabilities that can be used for developing a competitive advantages. Examples of such strengths include.. Strong Brand Names Patents Good reputation among customers Cost advantages from proprietary know-how. Exclusive access to natural resources Technological skills Distribution Channels Production Quality Management
Internal Environment ( Strengths / Weaknesses ) Analysis
•
• • • • • • • • • • •
Weaknesses – The absence of a firm’s certain strengths are a weakness. The following may be considered as weaknesses. A weak Brand Name Lack of Patent protection Poor reputation among customers High Cost Structure Lack of access to the best natural resources Absence of Important Technological skills Poor access to Distribution Channels Low customer retention Weak Management In some cases the weakness may be the flip side of a strength Ex. A firm has a large amount of manufacturing capacity which is a strength but unable to react quickly in the strategic environment due to large investment in its manufacturing capacity.
External Environment ( Opportunities / Threats ) Analysis
•
• • • • • • • • • • • • •
Opportunities – The External Environment analysis may reveal certain new opportunities for profit and growth. Some Ex. For opportunities are An unfulfilled customer need Arrival of new technologies Loosening of regulations Removal of international trade barriers Changing customer tastes / lifestyles Changes in Government’s policies Lower Personal Taxes Change in population – age structure New Distribution Channels Customized Products More convenient buying process ( Buying thru’ Internet etc., ) Faster Delivery of a product or service (FedEx delivers faster than US Post) Companies uses Market Opportunity Analysis ( MOA ) to evaluate opportunities.
External Environment ( Opportunities / Threats ) Analysis • Threats – Changes in the External Environment may present threats to the firm. Few Examples are.. • Shifts in consumer tastes away from the firm’s products. • Emergence of substitute products • New Governmental regulations • Increased Trade Barriers • Technological advances • Tax Increase • Changes in Population-age structure • New Distribution Channels
Strengths
Weaknesses 1.A weak Brand Name
1.Strong Brand Names 2.Patents 3.Good reputation among customers 4.Cost advantages from prop. know-how. 5.Exclusive access to natural resources 6.Technological skills 7.Distribution Channels 8.Production Quality 9.Management Opportunities 1.An unfulfilled customer need 2.Arrival of new technologies 3.Loosening of regulations 4.Removal of international trade barriers 5.Changing customer tastes / lifestyles 6.Changes in Government’s policies 7.Lower Personal Taxes 8.Change in population – age structure 9.New Distribution Channels
2.Lack of Patent protection 3.Poor reputation among customers 4.High Cost Structure 5.Lack of access to the best natural resources 6.Absence of Important Techno. skills 7.Poor access to Distribution Channels 8.Low customer retention 9.Weak Management
Threats
1.Shifts in consumer tastes away from the firm’s products. 2.Emergence of substitute products 3.New Governmental regulations 4.Increased Trade Barriers 5.Technological advances 6.Tax Increases & New Distr. Channels 7.Changes in Population-age structure
Summary
• • • • • Many themes or challenges facing the Companies/ industries have been around for a long time, though the list grows ever-longer The company should know what it must do… Companies not crying-wolf when describing challenges… SWOT Analysis has very effectively captured them After years of adaptation and rationalization the Companies / Industries remains vulnerable to a hostile operating and regulatory environment Companies should do SWOT Analysis in all their strategic planning before taking any strategic decisions with respect to their Products & Services.
doc_564016306.ppt
Marketing management is a business discipline which is focused on the practical application of marketing techniques and the management of a firm's marketing resources and activities.
MARKETING
• Marketing is the process of planning and executing the conception, promotion and distribution of ideas, goods, services, organizations and events to create and maintain relationships that will satisfy individual and organizational objectives.
- Boone & Kurtz.
•Marketing is the social process by which individuals and groups obtain what they need and want through creating and exchanging products and value with others. - Kotler • Marketing is an organizational function and a set of processes for creating, communicating and delivering value to customers and for managing the customer relationships in ways that benefit the organization and its stake holders. - American Management Association
IMPORTANT ELEMENTS OF MARKETING
• Marketing focuses on the satisfaction of customer needs, wants and requirements. • The Philosophy of Marketing needs to be owned by everyone from within the organization. • Future needs to be identified and anticipated. • Focus on the Profitability in case of Corporate Sectors. • Recent definitions recognizes the influence of Marketing upon society.
SCOPE OF MARKETING
• • • • • • • • • • • • • Spot and choose right marketing segment. Know how to differentiate our offerings. Handle Price Objections. Compete against lower cost and lower price competitors. Customize the offerings. Grow on Business. Build stronger Brands. Reduce the cost of customer acquisitions. Keep the customers loyal for long. Measure the effects of Advertisement , Sales Promotion & PR. Improve Sales Force’s Productivity. Establish and Manage multiple channels. Effectively resolve channel conflicts and remain customer oriented.
WHAT IS
MARKETED ?
physical goods. airlines, beauticians, car rentals amusement parks, dolari-dhani celebrities , film stars / sports trade shows, olympic / sports real estate, stocks and bonds. corporate identity ads etc., encyclopedias , package labels aids awareness / disc. smoking states, cities, regions, tourism
• • • • • • • • • •
Goods Services Experiences Persons Events Properties Organizations Information Ideas Places
-
MARKET
• • Physical place where buyers and sellers gathered to buy and sell goods. Refers to the group of consumers or organizations that is interested in the product, has the resources to purchase the product, and is permitted by law and other regulations to acquire the product. Total Population Potential Market Available Market Qualified Available Market Target Market Penetrated Market - those who have interest in buying - those who have enough resources to buy - those who are legally permitted to buy - the segment the firm decided to serve - those who have purchased the product
• • • • • •
MARKET PLACE Vs MARKET SPACE
• Market Place Physical in nature Ex. shopping in a store Vs Market Space digital in nature shopping on the Internet
• Metamarket – cluster of complimentary products and services that are closely related in the minds of consumers but are spread across diverse set of industries.
• Ex – Automobile metamarket – automobile manufacturers, new & old car dealers, financiers, ins.co.mechanics, spare parts dealers , service shops, auto magazines, auto sites on Internet , auto ads etc.,
KEY MARKETS
• Consumer Markets – Consumer goods , cosmetics, soft drinks etc.,
a. superior brand image b. superior product quality, packaging etc., c. availability and reliable service • Business Markets - Co s selling business goods & services.
a. well informed professional buyers b. stronger role played by sales force , price & co ’s reputation for reliability and quality.
KEY MARKETS
• Global Markets – companies selling goods and services in the global markets. a. pricing in difft. countries. b. product and service features. c. culture , language , political systems , currency • Non – Profit & Governmental Markets – co s selling their goods and services to non-profit organizations or govt. agencies. a. carefully priced b. lowest bid favoured
MARKETING – NEW OPPORTUNITIES & CHALLENGES
• Changing technology – digital revolution , Information age
•
• •
Globalization - technological advances in transport , shipping & com
Deregulation – greater competition and growth opportunities Privatization – increase in efficiency
•
• •
Customer empowerment – customer expect higher quality & service
Customization – personalized services Industry convergence – add on products / services by cos.
•
•
Retail transformation – marketing an experience
Disintermediation – delivery of products / services thru’ on – line.
MARKETING MANAGEMENT
• 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.
MARKETING CONCEPTS
• Needs , Wants & Demands Needs – Basic human requirements * stated needs * real needs * unstated needs * delight needs * secret needs * Needs become wants when people are directed to specific objects that might satisfy the need. * Demands – wants for specific products backed by an ability to pay.
MARKETING CONCEPTS
• Segmentation – Division of the market in to various segments by analyzing the profile of buyers based on their demographic , psychological and behavioral patterns.
• Target Markets – segments present the greatest opportunity. • Positioning – The market offering ( product ) is positioned in the minds of target buyers as delivering some central benefits.
MARKETING CONCEPTS
• Offerings & Brands – Offering is a value proposition , a set of benefits companies offer to customers , to satisfy their needs. • Brand – an offering from a known source and carries many associations in the minds of people. • Value & Satisfaction – tangible & intangible benefits to customers.
MARKETING CONCEPTS
• Marketing Channels – to reach the target market
* communication channels – radio, t v, magazines , mail , posters * distribution channels - distributors , wholesalers, retailers , agents * service channels – to carryout the transaction with potential buyers - warehouses, banks, ins. , transportation cos..
•
•
Supply Chain – A longer channel stretching from raw materials to components and to final products that are carried to final buyers.
Competition – Includes all the actual and potential rival offerings & substitutes that a buyer might consider.
MARKETING CONCEPTS
• Marketing Environment
* Task Environment – production, distribution and promotion depts. * Involves company, suppliers, distributors, dealers & target cust.
* Broad Environment – consists of 6 components. * demographic environment * economic environment * physical environment * technological environment * political – legal environment * social – cultural environment
* Market Planning – analyzing mkt opportunity , selecting target mkt , designing mkt strategy, developing mktg programme, managing mktg effort.
MARKETING PHILOSOPHIES
• 1.Production Concept • 2.Product Concept • 3.Selling Concept
• 4.Marketing Concept
• 5.Holistic Marketing Concept
a. Relationship marketing b. Integrated marketing c. Internal marketing d. Social Responsibility marketing
MARKETING PHILOSOPHY – THE PRODUCTION CONCEPT
• One of the Oldest concepts prevailed from the time of industrial revolution until 1920’s. • Its an idea that the firm should focus on those products that it could produce most efficiently. • Production and supply of low cost products will in turn create demand that leads to consumers preferring widely available , inexpensive products.
• Ex : China’s ‘ Legend’ – PC mfr. & Haier – appliances co.
: took advantage of the country’s inexpensive labor pool
MARKETING PHILOSOPHY
• • • • • • The Product Concept Termed as make & sell philosophy Consumers favor products of high quality, performance, innovative features. The Selling Concept This concept emerged by the early 1930s. Companies not only would produce the products, but also would try to convince customers to buy them through advertising and personal selling. ‘ The purpose of marketing is to sell more stuff to more people more often for more money in order to make more profit.’ – - By an aggressive sales man.
•
MARKETING PHILOSOPHY – THE MARKETING CONCEPT
• This concept emerged in mid-1950s. ( after world war II )
• Customer centered philosophy ( ‘ sense and respond’ )
• Focuses on the customer needs before developing the product. • Aligns all functions of the company to focus on those needs. • Realizes a profit by successfully satisfying customer needs over the long term. • Reactive Market orientation – understanding and meeting customers’ expressed needs. • Proactive Market orientation - satisfy customers’ latent ( hidden – unsaid ) needs also.
MARKETING PHILOSOPHY – THE HOLISTIC MARKETING CONCEPT
• Based on the development, design, and implementation of marketing programs, processes, and activities that recognizes their breadth and inter-dependencies. • Four components of Holistic Marketing are * Relationship Marketing * Integrated Marketing * Internal Marketing * Social Responsibility Marketing * Holistic Marketing attempts to recognize and reconcile the scope and complexities of marketing activities.
HOLISTIC MARKETING - COMPONENTS
• • • • • • • • • Relationship Marketing To develop deep, enduring relationships with all people or organizations that could directly or indirectly affect the success of the firm’s marketing activities. Aims to building mutually satisfying long term relationships with key parties – customers, suppliers , distributors and other marketing partners in order to earn and retain their business. CRM & PRM to be strengthened. To build a unique company asset called marketing network. Integrated Marketing a program to create, communicate & deliver value for consumers. Mktg Mix – set of marketing tools a firm uses to pursue its marketing operations. McCarthy’s Four P’s of Marketing
HOLISTIC MARKETING - COMPONENTS
•
• • •
4 P’s – Product , Price , Place & Promotion.
Internal Marketing Is the task of hiring, training and motivating able employees who want to serve customers well. Various marketing functions – sales force , advertising , customer service , product mgt. , marketing research must work together. Social Responsibility Marketing Incorporates ethical , environmental , legal and social context of marketing activities and programs. Marketers to build social and ethical considerations in to their marketing practices.
• •
•
•
Cause – Related Marketing – Co. with an image, product , or service to market builds a relationship or partnership with the ‘ cause ’ or for mutual benefit.
LATEST TRENDS IN MARKETING
Fundamental Mktg Trend
• • • • • • • Marketing for the organization Organizing by product units Making everything By own Using Many suppliers Relying on old Market Positions Emphasizing Tangible Assets Building brands thru’ Ads
Latest Trend in Marketing
* Marketing to everyone in the org. * Organizing by customer segments. * Outsourcing Prods, Sub-contracting * ‘ partnership’ with few suppliers. * Exploring New Mkts with Innovation. * Emphasizing intangible assets. * Building brands thru’ performance & integrated communications.
LATEST TRENDS IN MARKETING
•
•
Fundamental Mktg Trend
B2C – thru’ stores & sales people Selling to Everyone Focusing on Profitable transactions Focus on gaining mkt. share Local adaptation thru’ Centralization & De-centralization strategy Focusing on the Financial strength
Latest Trend in Marketing
* B2B thru’ Online ( Internet Mktg ) * Selling to well defined target markets * Focus on customer lifetime value * Focus on building customer share * Global Standardization
• • • • •
* Focusing on Marketing Strength
•
Focusing on Shareholders’ prosperity
* Focus on Stakeholders’ prosperity
MARKETING MANAGEMENT TASKS
• • • • Developing Marketing strategies & Marketing Plans Capturing Marketing insights – Marketing Information Systems Marketing Environment – Micro ( suppliers , customers , channels, competitors ) Marketing Environment - Macro ( demographic , economic , physical, technology
political – legal, social – cultural forces )
•
• •
Connecting with customers –
Building strong brands
create value for the chosen target mkt. & develop strong, profitable, long term relationships with customers.
Shaping the Market Offerings – Product quality, design features, packaging
MARKETING MANAGEMENT TASKS
• • • Delivering Value – by products & services to the target market. Communicating Value – Marketing communication activities. Develop Integrated Marketing communication program – an attempt
to inform, persuade , remind the customers on the products & services – directly or indirectly, about the brands the cos. Sell.
•
•
Set up Mass Communication Programs – Advertising , Sales Promotion ,
events , Public relations, hire , train & motivate sales people.
Creating Long term Growth – Product Positioning , New Product Development
testing , launching & analyzing the changing global opportunities & challenges etc.,
•
Organize Marketing Resources & Implement & Control Marketing Plan
• •
Describes the strategic position of the product in the market place.
MARKETING MIX
Marketing Mix Theory origin – 1948 – By James Culliton. ‘ Marketing decision should be the result of something similar to recipe’
•
• • • • • •
1953- Neil Borden – President of AMA – changed the recipe idea & introduced term ‘Marketing Mix’.
1960 – E. Jerome McCarthy – Introduced 4Ps. Product – An object or service that is mass produced or manufactured on a large scale with a specific volume of units. Price – the amount customer pays for the product. Place – a location where the product can be purchased. Promotion – all of the communications that a marketer may use in the market place. Some Marketing experts still say..5Ps…others say Extended 7Ps….( People , Physical Evidence – Uniforms, Business Cards, Signages & Process – the whole customer experience ) – 7Ps applicable for service oriented companies.
MARKETING MIX – 4 Ps
( To generate positive response in the target market by blending these 4 marketing mix variables in an optimal manner )
Product
Price Target Market
Place
Promotion
MARKETING MIX - PRODUCT
• Product Characteristics : * Functionality * Quality * Appearance * Packaging * Brand * Service * Support * Warranty
MARKETING MIX - PRICE
• • • • • • Price Characteristics : List Price Discounts Financing Leasing Options Allowances
MARKETING MIX - PLACE
• • • • • • • • Place Characteristics : Locations Logistics Channel Members Channel Motivation Market Coverage Service Levels Internet / Mobile
MARKETING MIX - PROMOTION
• • • • • • • • •
Promotion Characteristics : Advertising Public Relations Trade Show Personal Selling Direct Selling Media Leaflets Discounts Offers
MARKETING STRATEGY FORMULATION
• • • • • • •
Identifying the target market Product Positioning Product pricing Distribution Marketing Communications Marketing Research Gathering Feedback & exercising control
Analysis of market situation & Forecast of future marketing Environment development
Analysis Phase
Determining of marketing goals •Market share •Sales Volume •Image •Awareness
Formulation of marketing strategies • Market field strategies • Market stimulation strategies • Market parceling strategies • Market area strategies • Competition oriented strategies
Planning Phase
Planning market policy activities •Product policy • Pricing •* Communication •Distribution Policy
Realization of the marketing decision
Implementation phase
Control of marketing success
Control phase
MARKETING STRATEGIES
• • • • • • • • Defining the corporate mission Defining the Business The Business Mission Goal Formulation Strategy Formulation Program formulation Implementation Feedback & Control
MARKETING PLAN
• • Marketing Plan is a written document that summarizes what the marketer has learned about the market place and indicates how the firm plans to reach its marketing objectives. It contains the tactical guidelines for the marketing programs and financial allocations over the planning period. Contents of Marketing Plan Executive summary and table of contents – brief summary of the main goals and recommendations. Situational analysis – relevant back ground data on sales , costs , the market , competitors , and the various forces in the macro – environment. Marketing strategy Financial projections – sales forecast, expense forecast, break even analysis etc., Implementation controls – control mechanisms for monitoring and adjusting implementation of the plan.
• •
•
• •
•
MARKETING ENVIRONMENT
• MACRO ENVIRONMENTAL FORCES • 1. DEMOGRAPHIC ENVIRONMENT • 2. ECONOMIC ENVIRONMENT • 3. SOCIAL – CULTURAL ENVIRONMENT • 4. NATURAL ENVIRONMENT • 5. TECHNOLOGICAL ENVIRONMENT
• 6. POLITICAL – LEGAL ENVIRONMENT
DEMOGRAPHIC ENVIRONMENT
• Marketers must be aware of * worldwide population growth * changing mixes of age * ethnic composition & educational levels * rise of non-traditional families * large geographic shifts in population * shift from mass marketing to micromarketing
ECONOMIC ENVIRONMENT
• Marketers need to focus on • • • • Income distribution Levels of savings Debt availability Credit availability
SOCIAL – CULTURAL ENVIRONMENT
• Marketers must understand the societal factors such as beliefs, values and norms that largely define the tastes and preferences of target buyers.
•
Indian Social – Cultural environment very complex - consists of regional differences in language, customs, social systems, values, caste systems, habits and religions.
Marketer must address the target market with • Customized research on consumption behavior • Customized research on attitudes of buyers specific to products and services.
•
NATURAL ENVIRONMENT
• Marketers need to be aware of the threats and opportunities associated with • Raw materials shortages • Increased Energy costs • Pollution Levels • Changing role of governments in environmental protection • New regulations by Central / State Governments.
TECHNOLOGICAL ENVIRONMENT
• Marketers should take account of • Accelerating pace of technological change
– Increasing no. of ideas
• Opportunities for innovation
– Startling range of new technologies that will revolutionize products & production processes.
• Varying R&D Budgets
– Increased opportunities in the R&D sector due to globalization.
• Increased governmental regulations of technological change
– Increased awareness on the safety of products leading to Govt. banning potentially unsafe products.
POLITICAL – LEGAL ENVIRONMENT
• Political – Legal environment composed of laws , government agencies , pressure groups that influence and limit various organizations and individuals.
Increase in Business Legislation – 1. to protect cos. From unfair competition 2. to protect consumers from unfair business practices 3. to protect the interests of society from unbridled business behavior. – consumer protection regulation , consumer complaints council ( CCC ) 4. NCDRC – National consumer disputes Redressal Commission.
•
SWOT Analysis
• Is an important tool for auditing the overall strategic position of a business and its environment. • It involves monitoring the external and internal marketing environment. • Environmental factors internal to the firm usually can be classified as strengths ( S ) or weaknesses ( W ) and those external to the firm can be classified as opportunities ( O ) or threats ( T ) – This analysis of the strategic environment is referred to as a SWOT Analysis.
SWOT FRAMEWORK
ENVIRONMENT SCAN
Internal Environment Analysis
External Environment Analysis
Strengths
Weaknesses
Opportunities
Threats
Internal Environment ( Strengths / Weaknesses ) Analysis
( The internal analysis is a comprehensive evaluation of internal environment’s potential strengths & weaknesses )
•
• • • • • • • • •
Strengths – A firm’s strengths are its resources and capabilities that can be used for developing a competitive advantages. Examples of such strengths include.. Strong Brand Names Patents Good reputation among customers Cost advantages from proprietary know-how. Exclusive access to natural resources Technological skills Distribution Channels Production Quality Management
Internal Environment ( Strengths / Weaknesses ) Analysis
•
• • • • • • • • • • •
Weaknesses – The absence of a firm’s certain strengths are a weakness. The following may be considered as weaknesses. A weak Brand Name Lack of Patent protection Poor reputation among customers High Cost Structure Lack of access to the best natural resources Absence of Important Technological skills Poor access to Distribution Channels Low customer retention Weak Management In some cases the weakness may be the flip side of a strength Ex. A firm has a large amount of manufacturing capacity which is a strength but unable to react quickly in the strategic environment due to large investment in its manufacturing capacity.
External Environment ( Opportunities / Threats ) Analysis
•
• • • • • • • • • • • • •
Opportunities – The External Environment analysis may reveal certain new opportunities for profit and growth. Some Ex. For opportunities are An unfulfilled customer need Arrival of new technologies Loosening of regulations Removal of international trade barriers Changing customer tastes / lifestyles Changes in Government’s policies Lower Personal Taxes Change in population – age structure New Distribution Channels Customized Products More convenient buying process ( Buying thru’ Internet etc., ) Faster Delivery of a product or service (FedEx delivers faster than US Post) Companies uses Market Opportunity Analysis ( MOA ) to evaluate opportunities.
External Environment ( Opportunities / Threats ) Analysis • Threats – Changes in the External Environment may present threats to the firm. Few Examples are.. • Shifts in consumer tastes away from the firm’s products. • Emergence of substitute products • New Governmental regulations • Increased Trade Barriers • Technological advances • Tax Increase • Changes in Population-age structure • New Distribution Channels
Strengths
Weaknesses 1.A weak Brand Name
1.Strong Brand Names 2.Patents 3.Good reputation among customers 4.Cost advantages from prop. know-how. 5.Exclusive access to natural resources 6.Technological skills 7.Distribution Channels 8.Production Quality 9.Management Opportunities 1.An unfulfilled customer need 2.Arrival of new technologies 3.Loosening of regulations 4.Removal of international trade barriers 5.Changing customer tastes / lifestyles 6.Changes in Government’s policies 7.Lower Personal Taxes 8.Change in population – age structure 9.New Distribution Channels
2.Lack of Patent protection 3.Poor reputation among customers 4.High Cost Structure 5.Lack of access to the best natural resources 6.Absence of Important Techno. skills 7.Poor access to Distribution Channels 8.Low customer retention 9.Weak Management
Threats
1.Shifts in consumer tastes away from the firm’s products. 2.Emergence of substitute products 3.New Governmental regulations 4.Increased Trade Barriers 5.Technological advances 6.Tax Increases & New Distr. Channels 7.Changes in Population-age structure
Summary
• • • • • Many themes or challenges facing the Companies/ industries have been around for a long time, though the list grows ever-longer The company should know what it must do… Companies not crying-wolf when describing challenges… SWOT Analysis has very effectively captured them After years of adaptation and rationalization the Companies / Industries remains vulnerable to a hostile operating and regulatory environment Companies should do SWOT Analysis in all their strategic planning before taking any strategic decisions with respect to their Products & Services.
doc_564016306.ppt