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Chapter 1.pptx

  2. CONCEPT OF MARKETING • Simply marketing means satisfying customers needs profitably: Deliver customer satisfaction at a profit. Marketing is engaging customers and managing profitable customer relationships. The twofold goal of marketing is to attract new customers by promising superior value and to keep and grow current customers by delivering satisfaction. • More broadly we can say that marketing is the business activities that are designed to identify and satisfy customers’ needs in a way that help to achieve company objectives. Actually marketing starts before production. • That means understanding the customer needs through market Research. 2
  3. DEFINITION OF MARKETING According to Philip Kotler & Gary Armstrong: “Marketing is the process by which companies create value for customers and build strong customer relationships in order to capture value from customer in return.” Marketing is an organizational function and a set of processes for creating, communicating, and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders. –(The American Marketing Association) 3
  4. MARKETING CONCEPT: Marketing is a social and managerial process by which companies identify customer needs and wants, satisfy customer needs and build strong customer relationship in order to accomplish the company objectives. 4
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  6. CONCEPT MARKETING MANAGEMENT To know about Marketing Management we should know about two term Marketing and Management. Marketing: ……………………………………….. Management Management is a distinct process consisting of activities of planning, organizing, actuating, motivating, coordinating, and controlling to achieve the organizational goals. 6
  7. DEFINITION OF MARKETING MANAGEMENT According to Philip Kotler: “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”. According to Steven J. Skinner: “Marketing management is the process of planning, organizing, implementing and controlling marketing strategies”. 7
  8. CORE MARKETING CONCEPT 1. Needs, wants, and demands Needs – States of felt deprivation, part of human makeup – Physical and social needs Wants – The form needs take (e.g. food => hamburger) – Shaped by culture and personality Demands – When wants are backed by buying power 8
  9. CORE MARKETING CONCEPT 2. Products and Services Products • – Anything that can be offered to satisfy a need or a want • – Physical products, services, experiences, persons, places, organizations, • information, ideas • – Example: “smoking is bad” idea can be a product, a person can be a product in an election • – Aka: satisfier, resource, marketing offer Services • – Just one kind of a product
  10. CORE MARKETING CONCEPT 3. Value, Satisfaction and Quality (Customer) Value – Difference between “value gained by owning and using a product” and “cost of obtaining the product” – Value gained not necessarily monetary – Similarly cost of obtaining not necessarily monetary – Customers act on perceived value [and perceived cost] (Customer) Satisfaction – Perceived performance relative to expectations Quality – Closely related to satisfaction – Narrow definition: no defects – Broad definition: ability to satisfy customer needs [circular definition!]
  11. CORE MARKETING CONCEPT 4. Exchange, Transaction, Relationship Exchange • – Obtaining a desired object from someone by offering something in return • – Offerings could be money, product, service, ... Transaction – A trade of values between two parties; marketing's unit of measurement! – Monetary transactions and barter transactions Relationship (Marketing) – Going beyond short term transactions – Long-term relationships with valued customers, partners, etc – Marketing network – company and all its supporting stakeholders
  12. CORE MARKETING CONCEPT 5. Markets Market – Economist's definition – Place (virtual or physical) where buyers and sellers meet Market – Marketer's definition – The set of actual and potential buyers of a product – The sellers of a product are labeled as the “industry” Industry – Marketer's definition – The sellers of a product
  13. CORE MARKETING CONCEPT 6.Segmentation, Target Markets and Positioning 7.Marketing Channel 8.Supply chain 9.Competition 10.Marketing Environment 11. Marketing Planning
  14. THINGS TO REMEMBER • 1. Define marketing and outline the steps in the marketing process. • 2. Explain core concepts of marketing.
  15. MARKETING ORIENTATIONS/ PHILOSOPHIES • The Production Concept (1860-1920) • The Product Concept (1920- 1930) • The Selling Concept (1930-1950) • The Marketing Concept (1955-1990) • The Societal Marketing Concept (1970 to present) • The Holistic Marketing Concept (Latest) 15
  16. 1. The Production Concept (1860-1920) Oldest concept of marketing This philosophy assumes that consumer will buy those product which are widely available and are affordable cost. According to this concept management should focus on improving the production and distribution efficiency. This is called manufacturing oriented philosophy. • Drawback: Customers do not always prefer inexpensive and easily available products. Moreover, the availability and low price of the product do not ensure increased sales and survival and growth of the firm. • Example-Standard Raw Materials and components, CD, LCD, etc. MARKETING ORIENTATIONS/ PHILOSOPHIES
  17. 2. Product Concept The product concept believes that consumers will favor those products that offers most quality performance or innovative features. • Product improvement is the key to profit maximization under the product concept. • Managers in these organizations assume that buyers admire well-made products and give more attention to quality and performance. • The quality and design of a product are more important than customer input. Drawback: Customers may not buy a product just because it is of higher quality unless they need it. Example- Many computer companies use the product concept to consistently improve the hardware and software components to outperform the competitors. MARKETING ORIENTATIONS/ PHILOSOPHIES
  18. 3. The Selling Concept The selling concept believes that consumer if left alone, will ordinarily not buy enough of the organization’s product. The organizations must therefore undertake an aggressive selling and promotion effort. • Due to increased competition, only the quality and availability of the product do not ensure the survival and growth of the firm. • This concept assumes customers will not buy the products unless they are adequately convinced and motivated to do so. • Most of the selling-oriented companies believe that customers can be persuaded and manipulated to buy the products. Drawback: Customers once wrongly persuaded can spoil the firm’s image. So the selling concept can succeed in the short run but not in the long run. MARKETING ORIENTATIONS/ PHILOSOPHIES
  19. 4. Marketing Concept • The marketing concept emphasizes that firms can achieve the objective of profit maximization by finding out the needs and requirements of customers and effectively satisfying them. • In this concept, all decisions are taken from the viewpoint of customers, such as what product will be produced, with what features, at what price, etc. • The marketing concept aims to make what customers want to buy and not what a marketer wants to sell. This basic role of a firm under marketing concept is-‘Identify a need and satisfy it better than competitors’. • Under this concept products are bought because they satisfy the specific need of a customer which can be expressed in colorful ways such as: • ‘’Open Happiness’’ Coca-Cola MARKETING ORIENTATIONS/ PHILOSOPHIES
  20. 5. Societal Marketing Concept • The societal marketing concept emphasizes that along with customer satisfaction due importance should be given to the welfare of the customer and the society. • This concept brings a balance between customer satisfaction, social welfare, and profitability. It clears that a marketer should not offer a product to consumers if it is not in the best interest of consumers. • Eg. Ban on tobacco advertisements, a ban on smoking in public places. Safety warning is required in the case of hazardous goods or poisonous material, MARKETING ORIENTATIONS/ PHILOSOPHIES
  21. 6. Holistic Marketing Concept A holistic amrketing concept is based on development, design, and implementation of marketing programs, processes and activities that recognize the breadth and interdepencies. MARKETING ORIENTATIONS/ PHILOSOPHIES
  23. THINGS TO REMEMBER 1. Define marketing and outline the steps in the marketing process. 2. Explain core concepts of marketing. 3. Briefly describe marketing philosophies.
  24. MARKETING MIX 24 Marketing Mix Four Ps: • Product • Place • Promotion • Price Modern Marketing Management Four Ps: • People • Processes • Programs • Performance
  25. WHAT IS MARKETED?/ SCOPE OF MARKETING ● Goods (tangible) ● Services (intangible) ● Events (time based— trade shows) and ● Experiences (Walt Disney World’s Magic kingdom) ● Persons (Artists, Musicians, CEO, Physicians) ● Places (Cities, States, Regions, Nations) and ● Properties (Intangible rights of ownership of real estate or financial properties) ● Organizations (Universities, Museums) ● Information (Books, Schools, Magazines) ● Ideas (Revlon sell hope) 25
  26. MARKETING MANAGEMENT TASKS ● Developing marketing strategies (strategic fit) ● Capturing marketing insights (obtaining information) ● Connecting with customers (relationships) ● Building strong brands (understand strengths and weaknesses) ● Shaping market offerings ● Delivering value ● Communicating value ● Creating longterm growth (positioning and new-product development) 26
  27. HOW MARKETING AND BUSINESS ARE CHANGING? THE MARKETPLACE ISN’T WHAT IT USED TO BE…/ MAJOR SOCIETAL FORCES/ NEW MARKETING REALITIES 27 • Network information technology • Globalization • Deregulation • Heightened Competition • Industry Convergence • Disintermediation • Consumer Buying power • Consumer information • Consumer participation • Consumer Resistance • Retail Transformation
  28. RELATIONSHIP MARKETING • According to the Association of National Advertisers (ANA), relationship marketing refers to strategies and tactics for segmenting consumers to build loyalty. • Relationship marketing leverages database marketing, behavioral advertising and analytics to target consumers precisely and create loyalty programs. • Database marketing is an approach in which computer database technologies are used to design, create, and manage customer data lists containing information about each customer‘s characteristics and history of interactions with the company. • In online marketing, behavioral targeting is the practice of targeting and serving ads to groups of people who exhibit similarities not only in their location, gender or age, but also in how they act and react in their online environment. • Marketing analytics involves the discovery and communication of meaningful patterns in data from metrics like traffic, leads, sales, advertising, promotions, web activity, social media, and any other relevant marketing activity or financial data. 28
  29. EXAMPLES OF RELATIONSHIP MARKETING • Provide exceptional customer service, as customers who are consistently impressed by a brand’s customer service are more likely to remain loyal to the brand. • Thank customers through a social media post or with a surprise gift card. • Seek customer feedback through surveys, polls and phone calls, which can create a positive impression that customer opinions are valued and help to create better products and services. • Launch a loyalty program that rewards customers for their continued patronage. • Hold customer events to connect with customers and build a community. • Create customer advocacy or brand advocacy programs to reward customers who provide word-of-mouth advertising on a brand’s behalf. • Offer discounts or bonuses to long-time or repeat customers. 29
  30. GREEN MARKETING • According to the American Marketing Association, 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, packaging changes, as well as modifying advertising. • terms used are Environmental Marketing and Ecological Marketing. • "Green Marketing" refers to holistic marketing concept wherein the production, marketing consumption an disposal of products and services happen in a manner that is less detrimental to the environment with growing awareness about the implications of global warming, non-biodegradable solid waste, harmful impact of pollutants etc., both marketers and consumers are becoming increasingly sensitive to the need for switch in to green products and services. While the shift to "green" may appear to be expensive in the short term, it will definitely prove to be indispensable and advantageous, cost-wise too, in the long run. 30
  31. EXAMPLES OF GREEN MARKETING • Products those are originally grown, • Products those are recyclable, reusable and biodegradable, • Products with natural ingredients, • Products containing recycled contents, non-toxic chemical, • Products contents under approved chemical, • Products that do not harm or pollute the environment, • Products that will not be tested on animals, • Products that have eco-friendly packaging i.e. reusable, refillable containers etc. Examples: Digital Tickets, No Polythene carry bags for free, Lead Free Paints from Kansai Nerolac. 31
  32. E-MARKETING • Also termed as Web marketing, digital marketing, internet marketing or online marketing, Emails and wireless marketing. • The uses of electronic communication technologies, such as the Internet, mobile phones and digital televisions, to accomplish marketing objectives. • Examples: Web Sites, Microsite, Search ads, Display ads, Sponsorships, Online communities, Email, Mobile marketing, YouTube Video Marketing. 32