2. “It takes 20 years to build a reputation and five minutes to ruin
it. If you think about that, you’ll do things differently.”
Warren Buffett, Chairman and CEO of Berkshire Hathaway.
5. WHY STUDY MARKETING?
Whether an engineer in a manufacturing plant or a lawyer in an office,
we need to understand how to deal with diverse audiences. Studying
marketing will help us to learn how to interact and communicate with
different groups of people which is a valuable skill.
6. Defining of Marketing
Marketing is a set of organizational
functions and set of processes for
creating, communicating and
delivering value to customers and
for managing customer
relationships in ways that benefit
organization and its stakeholders
Philip Kotler
A social and managerial process
whereby individuals and groups
obtain what they need and want
through creating and exchanging
products and value with others.
7. Purpose of Marketing
• Getting yourself seen in the market
• Building brand name
• Generating sales
• Building brand
Now the fact is all the stated points are true but they are however results of what occurs when the
marketing and advertising efforts are working.
The purpose of marketing however cannot be summed up in point or two but broadly speaking the
three major purpose of marketing are as follows
8. PURPOSE
1
Give your customers a specific,
low-risk, easy-to-take action that
further facilitates their ability to
make a good decision. Lower the
risk of taking the next step in the
buying process so you can
further educate them.
Capture Attention Educate Convert
PURPOSE
2
PURPOSE
3
Capture the attention of your
target market/prospects. This
seems simple enough to do,
however, it requires strategic
planning and implementation to
do so. Most of the time, I see
people doing this incorrectly. We
ensure that you’re doing this the
right way.
Guide you prospects with
educational information to help
them make the best possible
purchasing decision. Provide
them with information to
facilitate their buying decisions
for your product or services.
9. Scope of Marketing
From mere buying and selling of products and services to understanding the importance of customer
satisfaction, customer delight and customer relationship. The scope of marketing has widened over the
period of years and keeps growing everyday.
10. Scope of Marketing
PRODUCTS AND SERVICES
MARKETING RESEARCH
CHANNEL OF DISTRIBUTION
PHYSICAL DISTRIBUTION
PROMOTIONAL DECISIONS
PRICING DECISIONS
ENVIRONMENTAL ANALYSIS
12. • Exchange is essence of marketing
• Marketing is customer/consumer oriented
• Marketing starts and ends with customers
• Modern marketing precedes and succeeds production
• Marketing is goal oriented and the goal being profit maximization through
satisfaction of human needs.
• Marketing is an art as well as science
• Marketing is the guiding element in business (it tell you, what, when, how
to produce. Marketing is capable of guiding and controlling the business)
• Marketing is a process
• Marketing is a series of interrelated processes
Nature of Marketing
Input Process Output
14. 01. NEED
02. WANT
03. DEMAND
Basic requirements of life
like food, water, clothing,
air etc.
Needs directed towards
specific objects that would
satisfy the need.
Wants for specific products
backed by an ability to pay
15. Companies address customer needs by
putting forth value proposition, a set of
benefits that satisfy those needs. The
intangible value proposition is made
physical by an offering, which can be a
combination of products, service,
information and experiences.
04. OFFERINGS
16. Some customers have needs which they are not fully conscious or cannot articulate.
What does the customer mean when he says “a peaceful hotel”, “a wonderful dress”.
Marketers must probe further.
17. Types of Needs
Why do you go to Dominos?
1. Stated Needs: I need food
2. Real Needs: I need quick and inexpensive service
3. Unstated Needs: I want my food to be safe and hygienic
4. Delight Needs: I get a free dessert with my order
5. Secret Needs: I need a place to hang out with my friends comfortably
18. Where Marketing Comes in?
• It is the Marketer’s job to understand what exactly is that customer wants?
Example:
• Customer: I want a cheap car
In this situation selling the customer a car that is cheap, but is really inefficient in fuel consumption
is bad Marketing. Marketer must understand the REAL and UNSTATED need for cheap
transportation.
• Customer: I want an inexpensive German made car
The Marketer must understand the SECRET Need of the customer of appearing powerful and
influential
• A lot of times the customer may not be aware of their true needs. It is the Marketer’s job in
that case to identify that need and fulfill it.
Example: Single DVD late fines giving rise to monthly/yearly subscription of Netflix/Amazon Prime
etc. and viewing unlimited videos.
20. Abraham Maslow
An American psychologist who was best known for
creating Maslow's hierarchy of needs, a theory of
psychological health predicated on fulfilling innate
human needs in priority, culminating in self-
actualization. Maslow described human needs as ordered in
a proponent hierarchy—a pressing need would need to be
mostly satisfied before someone would give their attention
to the next highest need. The hierarchy of human needs
model suggests that human needs will only be fulfilled one
level at a time.
21. PHYSIOLOGICAL NEEDS
SAFETY NEEDS
BELONGINGNESS NEEDS
EGO NEEDS
SELF-ACTUALIZATION NEEDS
Self fulfillment, enriching experiences, hobbies, charity etc.
Prestige, Status, Accomplishments etc.
Love, Friendship, Self-Acceptance etc.
Security, Shelter, Protection etc.
Food, Clothing, Air, Water
MASLOWS HIREARCHY OF NEEDS
23. PHYSIOLOGICAL NEEDS
SAFETY NEEDS
BELONGINGNESS NEEDS
EGO NEEDS
SELF-ACTUALIZATION NEEDS
COGNITIVE NEEDS
AESTHETIC NEEDS
TRANSCENDENCE NEEDS Need for helping others
Morality, creative, no prejudice, self-fulfillment, hobbies etc.
Need to appreciate and search for beauty, balance and form
To understand one’s surrounding environment, seeking
knowledge
Prestige, Status, Self-Esteem, Accomplishments etc.
Friendship, Love, Family, Self-Acceptance etc.
Security of body, job, health, property,
family etc.
Food, Clothing, Air, Water
MASLOWS EXPANDED HIREARCHY OF NEEDS
24. Key Takeaways
• Maslow wrote that there are certain conditions that must be fulfilled in order for the basic needs
to be satisfied. For example, freedom of speech, freedom to express oneself, and freedom to
seek new information are a few of the prerequisites. Any blockages of these freedoms could
prevent the satisfaction of the basic needs.
• Maslow defined Self-actualization as achieving the fullest use of one's talents and interests—the
need "to become everything that one is capable of becoming.
• Maslow's needs theory may give the impression that the Hierarchy of Needs is a fixed and rigid
sequence of progression. Yet, starting with the first publication of his theory in 1943, Maslow
described human needs as being relatively fluid—with many needs being present in a person
simultaneously.
• Maslow argued, the way in which essential needs are fulfilled is just as important as the needs
themselves. Together, these define the human experience. To the extent a person finds
cooperative social fulfillment, he establishes meaningful relationships with other people and the
larger world.
25. Transpersonal Psychology or Transcendence
• Maslow had concluded that humanistic psychology was incapable of explaining all aspects of
human experience. He identified various mystical, ecstatic, or spiritual states known as "peak
experiences" as experiences beyond self-actualization.
• Transcendence refers to the very highest and most inclusive or holistic levels of human
consciousness, behaving and relating, as ends rather than means, to oneself, to significant
others, to human beings in general, to other species, to nature, and to the cosmos”
• According to Maslow, self-transcendence brings the individual what he termed “peak
experiences” in which they transcend their own personal concerns and see from a higher
perspective. These experiences often bring strong positive emotions like joy, peace, and a well-
developed sense of awareness
26. Marketing is typically seen as a task of creating, promoting and delivering products and service to
consumers and business. Marketers are skilled in stimulating demand for a company’s products but
this is too limited a view of tasks marketers perform. Just as production and logistics professionals
are responsible for supply management, marketers are responsible for demand management.
Marketing managers seek to influence the level, timing and composition of demand to meet the
organization’s objectives. Today’s current market offers eight different states of demand.
27. STATE
1
STATE
2
STATE
3
STATE
4
STATE
5
STATE
6
STATE
7
STATE
8
DEMAND STATES
Negative Demand
A major part of the market dislike the
product and may even pay a price to avoid it.
E.g. Vaccines, injections etc.
No Demand
Target consumers may not be aware or
uninterested in the product. E.g.
Farmers may not be interested in new
methods of farming.
Latent Demand
Consumers share a strong need that
cannot be satisfied by an existing
product. E.g. more fuel efficient cars,
harmless cigarettes etc.
Declining Demand
Every organization sooner or later
faces declining demand for one or
more of its products.
Irregular Demand
Many organizations face demand that varies on
a seasonal, daily or even hourly basis. E.g.
museums are undervisited during weekdays
and overfull on weekends.
Full Demand
Organizations face full demand when they are pleased
with their volume of business. The marketing task is to
maintain current level of demand in the face of
changing consumer preferences. And increasing
competition.
Overfull Demand
Some organizations face demand more than they can
handle the marketers need to find ways to reduce demand
temporarily or permanently. This is called Demarketing
Unwholesome Demand
Marketer targets to discourage
consumption of a product. They try to
push people who like something to
give it up by using fear messages, price
hikes et..
29. SEGMENTATION & TARGET MARKET
• The process of breaking Buyers into groups that are different from each other but internally
similar is called Segmentation. It is not possible for a Marketer to satisfy everyone in a market.
Not everyone have the same choices, tastes, preferences. Therefore Marketer divides the Market
by identifying and profiling distinct groups of buyers who might prefer or require varying products
and service mixes.
• The Marketer then decides which segment presents the greatest opportunity – which becomes
the Target Markets.
30. MARKETPLACE, MARKETSPACE,
METAMARKET
• Marketplace is physical, as when one goes shopping in stores.
• Marketspace is digital, as when one goes shopping on the internet.
• Metamarket is a set of complementary products and services that are closely related in the minds
of consumers but are spread across a diverse set of industries. Metamarket has created an
opportunity for metamediaries to assist buyers to move seamlessly through these groups
although they are disconnected in physical space.
31. MARKETER AND PROSPECT
• A Marketer is someone seeking a response (attention, a purchase, a vote, a donation) from
another party, called the Prospect. If two parties are seeking to sell something to each other, we
call them both Marketers.
32. OFFERINGS AND BRAND
• Companies address customer needs by putting forth value proposition, a set of benefits that satisfy
those needs. The intangible value proposition is made physical by an Offering, which can be a
combination of products, service, information and experiences.
• A Brand is an offering from a known source. It can be defined as a name, logo, sign, symbol, colour etc.
which creates a unique identity in the mind of consumers distinct from its competitors. The stronger an
association with a brand, more favourable and strong is the brand image.
Brand Associations:
• McDonalds:
• Mercedes Benz:
Burgers, Fun, Fast Food, Children, Yellow Arch
Royalty, Status, Comfort, Safety, Prestige, Class
33. • Value can be defined as a ration between what a customer gets and what he gives. The customer
gets benefits and assumes cost. The benefits include functional benefits and emotional benefits.
The costs include monetary cost, time cost, energy cost and psychic costs. Value can be given by:
• Value can be seen as primarily a combination of Quality, Service and Price called as the Customer
Value Triad. The Marketer can increase value of the customer offering in several ways:
• Raise benefits
• Reduce costs
• Raise benefits and reduce costs
• Raise benefits by more than raise in costs
• Lower benefits by less than reduction in costs
VALUE
Value = Benefits = Functional Benefits + Emotional Benefits
Costs Monetary + Time + Energy + Psychic
34. EXCHANGE AND TRANSACTION
• Exchange is the process of obtaining a desired product from someone by offering something in
return. For exchange potential to exist five conditions must be fulfilled:
1. There are atleast two parties
2. Each party must have something that might be of value to the other party
3. Each party is capable of communication and delivery
4. Each party is free to accept or reject the exchange offer
5. Each party believes it is appropriate or desirable to deal with the other party.
• A Transaction is a trade of values between two or more parties. When an agreement is reached
between two parties trying to negotiate a deal, a transaction takes place.
35. RELATIONSIPS AND NETWORKS
• Transaction marketing is a part of a larger idea called Relationship Marketing. Relationship
marketing has aim of building mutually satisfying long-term relations with key parties –
customers, suppliers, distributors, government, in order to earn and retain their business.
Marketers accomplish this by promising and delivering high quality products and services at fair
prices to other parties over time. Relationship marketing builds strong economic, technical and
social ties among parties. Transactions move from being negotiated each time to being a matter
of routine.
• A marketing network consists of the company and its supporting stakeholders (customers,
employees, suppliers, distributors, retailers, society, government and others) with whom it has
built mutually profitable business relationships. Competition is not between companies if you see
but between marketing networks with the prize going to the company that has built the better
network. Marketing network is an asset for a company. Build an effective network of relationships
with key stakeholders and profits will follow.
36. MARKETING CHANNELS
To reach a target market a marketer uses three kinds of marketing channels:
• Communication Channel: delivers and receives messages from target buyers, includes
newspapers, television, radio, magazines, telephone, hoardings, posters, Internet etc. beyond this
message is also conveyed by facial expression, look of retail stores and many other media.
• Distribution Channel: this channel is used to display, sell or deliver physical products or
services(s) to the buyer or user. They include distributors, wholesalers, retailers, brokers, agents,
etc.
• Service Channel: service channel is used to carry out transactions with potential buyers. This
channel includes warehouses, transportation companies, banks, financial institutions and
insurance companies that facilitate transactions.
37. COMPETITION
Competition includes all the actual and potential rival offerings and substitutes that a buyer might
consider. Companies may be hurt in the long run by substitute products than products from its
immediate rivals.
Levels of competition based on product substitutability:
1. Brand Competition: a company views its competitors as other companies offering similar
products and service at the same time to the same customers at similar prices. Maruti might
see its major competitors as Tata Motors, Honda, Chevrolet etc. and not Mercedes or BMW.
2. Industry Competition: a company sees its competitors as all companies making the
same product or class of products. Maruti would see all automobile manufacturers as its
competition.
3. Form Competition: a company sees its competitors as all companies manufacturing
products that supply the same service. Maruti would not only see itself competing with other
car manufacturers but also manufacturers of motorcycles, trucks, bicycles.
4. Generic Competition: a company sees its competitors as all companies that compete for
the same consumer money. Maruti would see its competitors in companies making consumer
durables, electronic goods, hotels, real estate etc.
38. Competition represents only one force in the environment that a marketer operates. The marketing
environment consists of the Task Environment and Broad Environment.
• Task Environment: this includes immediate actors involved in producing, distributing and
promoting the offerings. The main players are the company, suppliers, distributors, dealers and
target customers. Included in the supplier group are material suppliers and service suppliers.
• Broad Environment: broad environment consists of six components demographic
environment, natural environment, technological environment, political-legal environment and
social-cultural environment. These environments contain forces that can majorly impact the
players in the Task environment. Marketers must pay close attention to the trends and
developments in these environments and make timely adjustments to their marketing strategies.
COMPETITION
39. • Impressions: impression occurs when a consumers view a communication. It is useful metric
for tracking the breadth of communication reach which can be compared across all
communication types. But it fails to provide any insight into the results of viewing the
communication
• Engagement: it is the extent of customer’s attention and active involvement with a
communication. It reflects a much more active response than mere impression and is more likely
to create value for the firm. Some online measures of engagement are Facebook “Likes”, Twitter
“Tweets” comments on a blog or web site and sharing a video or other content. Engagement can
extend to personal experiences that transform a firm’s products and services.
IMPRESSIONS AND ENGAGEMENT
40. Satisfaction reflects a person’s perceived performance in relationship to his expectations. If
performance falls short of expectation the customer is disappointed. If it matches, he is satisfied
and if the performance exceeds, then customer is delighted
SATISFACTION
42. A market is a place where two
parties can gather to facilitate
the exchange of goods and
services. The parties involved
are usually buyers and sellers.
The market may be physical like
a retail outlet, where people
meet face-to-face, or virtual like
an online market, where there
is no direct physical contact
between buyers and sellers.
45. Marketing Channels – TYPE 1
To reach the target market the marketers use three kinds of marketing
channels:
Deliver and receive messages from target buyers and include newspapers, T.V.,
radio, mail, telephone, hoardings, internet, fliers, CD’s, brochures etc.
COMMUNICATION
CHANNELS
46. Marketing Channels – TYPE 2
Help to display, sell, or deliver the physical product or service to the buyer or
user. They may be direct via internet, mail, mobile or indirect through
wholesalers, retailers, agents and other intermediaries.
DISTRIBUTION
CHANNELS
47. Marketing Channels – TYPE 3
This channel includes, warehouse, transportation, companies,
banks and insurance companies.
SERVICE
CHANNELS
49. In market economies, there are a variety of different market systems that
exist, depending on the industry and the companies within that industry.
It is important for small business owners to understand what type of
market system they are operating in when making pricing and production
decisions, or when determining whether to enter or leave a particular
industry.
MONOPOLY MARKET
PERFECT MARKET
OLIGOPOLY MARKET
MONOPSONY MARKET
MONOPOLISTIC MARKET
50. PERFECT
MARKET
Perfect competition is a market system characterized by many
different buyers and sellers. In the classic theoretical
definition of perfect competition, there are an infinite number
of buyers and sellers. With so many market players, it is
impossible for any one participant to alter the prevailing price
in the market. If they attempt to do so, buyers and sellers
have infinite alternatives to pursue.
51. MONOPOLY
MARKET
A monopoly is the exact opposite form of market system as
perfect competition. In a pure monopoly, there is only one
producer of a particular good or service, and generally no
reasonable substitute. In such a market system, the monopolist
is able to charge whatever price they wish due to the absence of
competition, but their overall revenue will be limited by the
ability or willingness of customers to pay their price.
52. MONOPOLISTIC
MARKET
Monopolistic competition is a type of market system combining
elements of a monopoly and perfect competition. Like a perfectly
competitive market system, there are numerous competitors in
the market. The difference is that each competitor is sufficiently
differentiated from the others that some can charge greater prices
than a perfectly competitive firm.
An example of monopolistic competition is the market for music.
While there are many artists, each artist is different and is not
perfectly substitutable with another artist.
53. OLIGOPOLY
MARKET
An oligopoly is similar in many ways to a monopoly. The primary
difference is that rather than having only one producer of a
good or service, there are a handful of producers, or at least a
handful of producers that make up a dominant majority of the
production in the market system. While oligopolists do not have
the same pricing power as monopolists, it is possible, without
diligent government regulation, that oligopolists will collude
with one another to set prices in the same way a monopolist
would.
54. MONOPSONY
MARKET
Market systems are not only differentiated according to the
number of suppliers in the market. They may also be
differentiated according to the number of buyers. Whereas a
perfectly competitive market theoretically has an infinite number
of buyers and sellers, a monopsony has only one buyer for a
particular good or service, giving that buyer significant power in
determining the price of the products produced.
57. Production Concept
• One of the oldest concepts of business.
• The concept holds that customers will prefer products that are widely available and inexpensive.
• Production oriented business concentrate on achieving high production efficiency, low costs and
mass distribution.
• This concept is used when company wants to expand its market.
• Not only product based but service based organizations also use this concept at times. Example
could be of many government agencies like unemployment offices, license bureaus. Many
medical practices. Many cases are handled per our but quality is extremely poor.
58. Product Concept
• Product concept is based on the fact that customers will favour those products that offer the
most quality performance, or innovative features.
• Organizations are focused on superior products and continuous improvements time and again.
• It is assumed that the customer is equipped to evaluate the quality of the product.
• Management usually might commit the “better-mousetrap” fallacy.
• Product concept can lead to Marketing Myopia
59. Selling Concept
• The selling concept holds that consumers and business, if left alone will ordinarily not buy enough
of the organization’s products.
• Aggressive selling and promotion techniques are adopted.
• This concept believes that customers show buying inertia and may be coaxed into buying.
• This concept also assumes that the organization is fully equipped with highly effective
promotional and selling tools to stimulate more buying.
• The selling concept is usually practiced more aggressively with unsought goods, goods that buyers
normally do not think of buying. Like insurance policies.
• This concept is also practiced by non-profit organizations like charitable trusts, college admission
offices, political parties.
• This concept is practiced by firms when they have overcapacity.
• Their aim is to sell what they make rather than make what the market wants.
• Marketing based on hard selling carries high risks. It assumes that customers who buy the
product will like it; and even if they don’t they will not complain or bad mouth about the product.
They will forget their disappointment and will buy again. This in real market is untrue.
60. Marketing Concept
• Instead of ‘product-centered’, ‘make and sell’ philosophy the shift was towards a ‘consumer-
centered’, ‘sense and sell’ philosophy. Instead of hunting marketing is ‘gardening’.
• The job is not to find right customers but to find right products for your customers.
• Marketing concept holds that the key to achieving organizational goals consist of being more
effective than competitors in creating, delivering and communicating superior customer value to
its chosen target markets.
• This concept has been expressed in many colourful ways:
• “meeting needs profitably”
• “find wants and fill them”
• “love the customers, not the product” etc.
• Marketing concept focuses on four pillars: ‘Target market’, ‘customer needs’, ‘integrated
marketing’, ‘profitability’.
61. Responsive/Anticipative/Creative,
Marketing
• Responsive Marketer finds a stated need and fills it
• Anticipative Marketer looks ahead into what the customers may need in near
future
• Creative Marketer discovers and produces solutions customers did not ask for but
to which they enthusiastically respond.
62. Societal Marketing Concept
• The marketing concept sidesteps the potential conflicts among consumer wants, consumer
interests and long-term consumer welfare. Environmental damage, resource shortage, explosive
population growth, hunger and poverty and neglected social services cannot be ignored and
therefore the new term that enlarges the Marketing Concept came into existence.
• This was termed as ‘Humanistic Marketing’ and some called it ‘Ecological Marketing’.
• Philip Kotler chose to term it as ‘The Societal Marketing Concept’.
• This concept not only focused on satisfying consumer needs effectively and efficiently but also
focused on the fact that in satisfying the customer the organization also enhanced the consumer’s
and society’s well-being.
• This concept calls upon marketers for building social and ethical considerations into their
marketing practices.
• This concept aims to keep a balance between company profits, consumer want satisfaction and
public interest.
63. Customer Concept
• Customer concept aims to provide separate offers, services and messages to individual
customers.
• The companies adopting the customer concept collect information of each customer’s past
transactions, demographics, psychographics and media and distribution preferences.
• The companies hope to achieve profitable growth through capturing a larger share of each
customer’s expenditure by building high customer loyalty and customer lifetime value.
• Internet, computer, factory customization and database marketing has made this concept
successful.
• This concept works best for companies that normally collect a great deal of individual customer
information, carry a lot of products that can be cross sold, carry products that need periodic
replacement or upgrading and sell products of high value.
• Investment required for practicing one-to-one marketing in collecting information, software and
hardware is huge and cannot be afforded by many companies.
65. E-business describes the use of electronic
means and platforms to conduct a company’s
business. Intranet and Internet helps in exchange
of information through Web.
E-commerce is more specific than e-business. Apart from
information sharing to visitors about the company, its history,
policies, job opportunities, the company also offers to transact
or facilitate the selling of products and services online.
E-marketing describes company efforts to
inform, communicate, promote and sell its
products and services over the Internet. The ‘e’
term is also used in terms such as e-learning, e-
finance, e-services etc.
68. STP marketing is an acronym for Segmentation, Targeting, and Positioning –
a three-step model that examines your products or services as well as the
way you communicate their benefits to specific customer segments.
69. Concept of Segmentation
Buyers if taken collectively is considered to be a market. In general every market has buyers with
HETEROGENEOUS characteristics. Thus taking that heterogeneous market and diving it into various
sub-groups of individuals who tend to be HOMOGENEOUS is known as MARKET SEGMENTATION.
Segmentation is essentially the identification of subset of buyers within a market that share similar
needs and demonstrate similar buying behaviour. The world is made up of billions of buyers with
their own set of needs and behaviour. Segmentation aims to match groups of purchasers with the
same set of needs and buying behaviour. Such a group is known as a ‘Segment’.
70. Defining Segmentation
Market Segmentation is the subdividing of the customers into homogenous sub-set of customers
where any sub-set may conceivably selected as market target to be reached with distinct Marketing
Mix.
Philip Kotler
71. Benefits of Segmentation
organization gets to know its customers better
provides guidelines for resource allocation
it helps focus the strategy of the organization
Limitation of Segmentation
Targeting multiple segments increases price
Segmentation can lead to proliferation of products
Narrowly segmenting the market can hamper the development of broad Brand Equity
Sometimes don’t achieve the desired goals
72. Types of Market Segmentation
UNDIFFERENTIATED MARKETING: this strategy of market segmentation is applied when there is
only one product and that product is offered to every consumer irrespective of consumer’s profile.
For instance a famous internet mobile connection service Airtel is offered to every consumer,
whether young, teenage, middle aged or old and any income group. This service is provided to have
internet connection and any kind of knowledge. Basically undifferentiated marketing is done to
achieve cost effectiveness because under this strategy there has to be only one product and one
marketing program to cater to all needs of the consumer.
73. Economies of scale could be achieved because of single product’s production at large scale and
profit maximization can be achieved.
Limitation:
Unable to cater to specific needs of consumers.
Unable to counter competition
No differentiation with respect to segmentation is done
74. DIFFERENTIATED MARKET: As the name suggests it means when a marketer
decides to operate in different segments of the market with different product
and different marketing program for each segment. By implementing this
strategy the marketer can have an edge over the competitor, as the marketer
is able to cater the different needs of the different consumers.
Creating different segments helps the marketer to customize the product
according to different needs of the segments, helping the marketer to fetch an
additional sale in each segment.
Example: automobile company FORD, which offers different segments of cars
like hatchback, sedan, luxury, petrol and diesel version to the different
segments of the consumer having different income levels.
Limitation of this strategy:
due to product differentiation, the product alteration cost increases
thereby increasing all the costs associated with the product.
SEGMENT
A
SEGMENT
C
SEGMENT
B
SEGMENT
D
75. CONCENTRATED MARKET: When a company decides not to go for the whole market but few
segments of the market. This strategy implies that rather than going for a small share of the whole
market one should one must concentrate on a larger share of small or sub-market.
Advantage: the company achieves a strong market position in that market and is able to cater the
needs and wants of the customer of that sub-market. Thus the company becomes a specialist in
that sub-market. In this type of marketing strategy the companies put all its efforts and resources in
the sub-market. The company enjoys cost effectiveness because of product specialization.
Disadvantage: putting all eggs in one basket. This means that the sub-market becomes vulnerable to
severe competition. This makes the companies to focus on one segment and neglect others which is
definitely not suitable in today’s competitive world.
76. Niche Market: A niche market is the subset of the market on which a specific product is focused.
The market niche defines the product features aimed at satisfying specific market needs, as well as
the price range, production quality and the demographics that it is intended to target
TOTAL MARKET
NICHE
77. Attributes of Effective Segmentation
Identifiable: the differentiating attributes of the segments must be measurable so they can be
identified.
Accessible: the segments must be reachable through communication and distribution channels.
Unique needs: to justify separate offerings, the segments must respond differently to different
marketing mixes.
Substantial: the segments should be sufficiently large to justify the resources required to target
them.
Durable: the segments should be relatively stable to minimize the cost of frequent changes
79. Geographic Segmentation
Geographic segmentation tries to divide the entire market into various geographical units:
• Regions: continent, country, state or even neighborhood
• Size of the area: segmented according to size of population
• Population Density: often classified as urban, suburban, or rural
• Climate: according to weather patterns common to certain geographic regions like temperate,
torrid, tropical etc.
80. Demographic Variable
Demographic segmentation consists of dividing the market into groups based on variables such as:
• Gender (Male/Female)
• Age
• Income
• Family Life Cycle
• Race/Ethnic Group
• Education
• Occupation
• Family Size
• Religion
• House ownership
81. Psychographic Segmentation
Psychographic segmentation groups customers according to their lifestyle. Activities, Interest, and
Opinions (AIO) surveys are one tool for measuring lifestyle.
• Activities
• Interests
• Opinions
• Values
82. Behavioural Segmentation
Behavioristic segmentation is based on actual customer behavior towards products. Some
Behavioristic variable include:
• Opinions, interests and hobbies
• Degree of loyalty
• Occasions
• Benefits sought
• Usage
83. TARGETING
Step two of the STP marketing model is targeting. Your main goal here is to look at
the segments you have created before and determine which of those segments
are most likely to generate desired conversions (depending on your marketing
campaign, those can range from product sales to micro conversions like email
signups).
84. Your ideal segment is one that is actively growing, has high profitability, and has a
low cost of acquisition:
• Size: Consider how large your segment is as well as its future growth potential.
• Profitability: Consider which of your segments are willing to spend the most
money on your product or service. Determine the lifetime value of customers in
each segment and compare.
• Reachability: Consider how easy or difficult it will be for you to reach each
segment with your marketing efforts. Consider customer acquisition costs (CACs)
for each segment. Higher CAC means lower profitability.
85.
86. POSITIONING
The final step in this framework is positioning, which allows you to set your
product or services apart from the competition in the minds of your target
audience. There are a lot of businesses that do something similar to you, so you
need to find what it is that makes you stand out.
“Simply put, positioning in marketing is a strategic process that involves creating
an identity/ image of the brand or product within the target customers’ minds.”
87. Types of Positioning in Marketing
Researchers in the Journal of Business & Industrial Marketing discovered that positioning in
marketing is predominantly determined by hard criteria (e.g., quality of product/ service) and
relationship-building factors (e.g., personal contact).
Other considerations, such as company structures (i.e., geographical coverage), degree of
integration, and breadth of offerings (i.e., location in the distribution chain), also play a vital part.
The study also noted that the level of familiarity with a brand is a contributing factor to perceptions
of the pursued positioning in marketing strategies.
88. Price Positioning
Pricing is an essential factor that impacts the decisions of most customers. Companies with the
lowest-priced products at a reasonable level of quality usually wins in many product areas.
For example, Gillette vs. Dollar Shave Club. Lower-priced alternatives to some high-quality brands
like Gillette have changed the landscape of razors and refill blades. The Washington Post reported
on Gillette’s decreasing market share due to Dollar Shave Club’s low prices.
89. Quality Positioning
Quality can help rebuff most pricing wars. In some markets, such as luxury cosmetics or cars, quality
can define who the competitors are.
Differentiation Positioning
Differentiation is what sets your product or service apart from the crowd. If your product or service
is dramatically different, rivals may not pose as much of a threat.
90. All the different factors that you considered in the first two steps should have made
it easy for you to identify your niche. There are three positioning factors that can
help you gain a competitive edge:
• Symbolic positioning: Enhance the self-image, belongingness, or even ego of
your customers. The luxury car industry is a great example of this – they serve the
same purpose as any other car but they also boost their customer’s self-esteem
and image.
• Functional positioning: Solve your customer’s problem and provide them with
genuine benefits.
• Experiential positioning: Focus on the emotional connection that your customers
have with your product, service, or brand.
The most successful product positioning is a combination of all three factors
92. Selling is first and foremost a
transaction between the seller
and the prospective buyer or
buyers (target market) where
money is exchanged for goods
and services. Selling is the art of
closing a deal.
95. • Aggressive Selling: The bottom line in this type of selling is that if the
prospect walks, the sale is lost. The style is hard driving; this is the
salesperson who won't take "no" for an answer.
• Transactional Selling: This approach focuses on making quick sales;
there is no attempt to form a long-term relationship with the
customer. While transactional selling tends to be looked down on
today, it does have its place. Looking at it from the customer's point
of view, sometimes a simple transaction is all the customer wants.
96. • Consultative Selling: consultative selling depends on developing a
long-term relationship with the customer. The salesperson's goal is to
get to know the customer's needs and wants so he or she can do the
best job of giving the customer what they want.
• Collaborative Selling: Collaborative selling takes relationship selling
one step further; this sales approach depends on a partnership
mentality between buyer and seller
97. Difference between Selling & Marketing
Sr.No. SELLING Marketing
1 Emphasis is on the Product Emphasis is on customer Needs
2 Company first makes the product and figures
out how to sell
Company first figures out customer’s needs, wants
and demands and then figures out how to make it
3 Sales Volumes Oriented Profit Oriented
4 Planning is short-term oriented, regarding
today’s market and products
Planning is long run oriented regarding new
products, tomorrow’s market and future growth
5 Let the buyers beware Let the seller be aware
6 Product first then Customer Customer first then Product
7 Starting Point is Factory Starting point is Market
8 Inside-out Outside-in
98. Difference between Selling & Marketing
Sr.No. SELLING Marketing
1 Heavy Selling & Promotion Integrated Marketing
2 Cost of Production Marketing Determined
3 Compelling consumer's mind towards goods
and services.
Directing goods and services towards consumer's
mind.
4 Selling is a direct Activity Marketing is an indirect Activity
101. Sales
Costs
Profits
Marketing Objectives
Product
Price
Low sales
High cost per customer
Negative
Create product awareness
and trial
Offer a basic product
Use cost-plus
Distribution Build selective distribution
Advertising Build product awareness among early
adopters and dealers
102. Sales
Costs
Profits
Marketing Objectives
Product
Price
Rapidly rising sales
Average cost per customer
Rising profits
Maximize market share
Offer product extensions, service,
warranty
Price to penetrate market
Distribution Build intensive distribution
Advertising Build awareness and interest in the
mass market
103. Sales
Costs
Profits
Marketing Objectives
Product
Price
Peak sales
Low cost per customer
High profits
Maximize profit while defending
market share
Diversify brand and models
Price to match or best competitors
Distribution Build more intensive distribution
Advertising Stress brand differences and benefits
104. Sales
Costs
Profits
Marketing Objectives
Product
Price
Declining sales
Low cost per customer
Declining profits
Reduce expenditure and milk the brand
Phase out weak items
Cut price
Distribution Go selective: phase out unprofitable
outlets
Advertising Reduce to level needed to retain
hard-core loyal customers
